Tefron forms joint venture with Chinese textile company
08 May '06
4 min read
The growth in revenues over the first quarter of 2005 were mainly due to the growth in sales of the company's active-wear product line, and in particular sales to Nike for their Nike Pro category, as well as due to the growth in sales of the company's swimwear product line. Revenues from the swimwear product line are typically the strongest in the first quarter of the year due to the seasonality of the swimwear business.
On a GAAP basis, the 2006 first quarter gross margin increased to 24.5 percent from 15.8 percent in the first quarter of 2005. Operating income grew to $8.0 million (14.1 percent of revenues) compared with an operating income of $3.2 million (6.1 percent of revenues) in the first quarter of 2005.
The net income for the quarter reached $5.4 million or $0.26 per diluted share (9.5 percent of revenues) compared with a net income of $1.2 million or $0.07 per diluted share (2.3 percent of revenues) in the first quarter in 2005.
Yos Shiran, CEO of Tefron, said, "We have demonstrated a solid start to 2006, continuing on our growth strategy from last year. Most significantly, the increase in our revenues was accompanied by an improvement in both our gross and operating margins."
Shiran, continued, "Our first quarter results reflect strength in our active-wear and swimwear product lines in accordance with our strategic plan. We are looking for a significant increase in our active-wear revenues in the second half of the year as we work to further expand our product lines while entering into new categories and increase the visibility of our EFP(TM) technology."
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