Delta Activewear Apparel segment sales up in Q1 2008
05 Nov '07
3 min read
Delta Apparel Inc reported financial results for its fiscal first quarter ended September 29, 2007.
Net sales for the three months ended September 29, 2007 increased 15.8% to a first quarter record of $72.6 million compared to $62.7 million in the prior year's first quarter.
The increase was driven primarily by the acquisition of FunTees on October 2, 2006 and the sales growth in the Junkfood business, but was somewhat offset by lower sales of Soffe products and undecorated t-shirts.
Gross margins declined 980 basis points to 17.9% compared to 27.7% in the prior year first quarter primarily as a result of higher sales in the activewear segment, higher raw material prices, and textile restructuring related costs.
Net loss for the first quarter was $1.5 million, or ($0.18) per diluted share, compared to the prior year's net income of $2.2 million, or $0.26 per diluted share. The first quarter of the prior year included an extraordinary gain, net of taxes, of $0.7 million, or $0.08 per diluted share, associated with the final earn-out payment made to the former M. J. Soffe shareholders.
The Company previously announced on July 18, 2007 an overall restructuring plan which included the closing of its Fayette, Alabama manufacturing facility, the expensing of excess manufacturing costs with the FunTees integration and start-up costs stemming from the opening of its Honduran textile facility.
The restructuring charges began in the Company's fiscal fourth quarter of 2007 and are expected to impact financial results through the third quarter of fiscal 2008. The Company expects to incur total costs of approximately $11.8 million, or $0.90 per diluted share, associated with the restructuring.
marketing@alchempro.com
