Justin Grow - Executive Vice President & Chief Administrative Officer Operator Please note that any forward-looking statements are made only as of today and except as required by law. The company does not commit to update or revise any forward-looking statements even if it becomes apparent that any projected results will not be realized. Looking at our third quarter results, as expected parts of our business continued to be impacted by the wellpublicized rightsizing of inventory levels across the retail sup ...

Financial Data and Key Metrics - Net sales for Q2 2023 were $107.3 million, down from $131.7 million in the prior year quarter [23] - Delta Group segment net sales were $91.3 million, compared to $115.3 million in the prior year quarter [24] - Salt Life Group segment net sales were $19 million, representing 16% growth over the prior year [24] - Gross margins were 14.7% overall for the quarter, down from 25.5% in the prior year [29] - Salt Life Group segment gross margins improved to 59% compared to 52.4% in the prior year [30] - Operating loss for Q2 2023 was $5.3 million, compared to operating income of $14.4 million in the prior year [32] - Adjusted EBITDA for the quarter was $2.6 million, down from $18.1 million in the prior year [32] Business Line Data and Key Metrics - DTG2Go posted year-over-year revenue growth of 18% and continues to be a key sales growth driver for the Delta Group segment [13] - Salt Life opened its 22nd and 23rd branded retail stores, with plans to expand further in the Northeast market [17] - The company is developing a business-to-business portal targeting the ad specialty and promotional markets, expected to launch in Q3 [21] - The activewear business experienced demand softness, with sales in the Global Brands channel down slightly year-over-year [19] Market Data and Key Metrics - Salt Life's e-commerce sales grew 24% during the quarter, with the site remaining one of the most profitable distribution channels [104] - The wholesale channel accounted for 72% of Salt Life's sales last fiscal year and continues to gain new accounts [114] - The retail direct channel delivered double-digit growth, with the company expanding its customer base across brick-and-mortar and e-commerce players [115] Company Strategy and Industry Competition - The company is focusing on managing working capital, reducing inventory and debt levels, and deploying capital resources to generate the most positive impact for shareholders [33] - Delta Apparel is leveraging its vertical integration, fulfillment network scale, and strong customer relationships to innovate and expand its digital strategies [18] - The company is placing more emphasis on consumer-ready channels, which carry more consistent margins and allow better management of cotton and raw material cost risk [107] Management Commentary on Operating Environment and Future Outlook - The company expects revenue to get closer to the prior year in subsequent quarters and operating loss to narrow over the next two quarters [3] - Management anticipates the Delta Group will return to profitability either late this year or early next year [47] - The company is encouraged by improving demand, particularly in the basic undecorated tees segment [53] Other Important Information - The company incurred a net loss of $7 million or $1 per diluted share for Q2 2023, compared to net income of $10.1 million or $1.44 per diluted share in the prior year [25] - Interest expense was $3.7 million in the quarter, more than double the prior year second quarter expense of $1.8 million [25] - The company expects to end the fiscal year with approximately 26 Salt Life retail stores in operation [105] Q&A Session Question: How is the company managing gross margin pressures from production curtailments and higher inventory costs? - The company expects sequential improvement in margins as it cycles through higher cost inventory through the back half of the fiscal year [111] Question: What is the outlook for the Delta Group's return to profitability? - Management anticipates the Delta Group will return to profitability either late this year or early next year [47] Question: What is the current internalization rate for DTG2Go, and where is it expected to head over time? - The internalization rate is a little over 50% today, and the company expects it to continue to increase, particularly on the Polaris equipment [73] Question: What are the company's inventory reduction targets? - The company expects to reduce inventory by $25 million further by year-end and continue to bring down inventory levels in units as it progresses through next year [72]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 1, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number 1-15583 DELTA APPAREL, INC. ______________________________ (Exact name of registrant as specified in its charter) | Georgia | 5 ...

Delta Apparel, Inc. - March 2023 Investor Presentation 16 ▲ A ▲ Commercial Flow 1% 99% Screen and Other 6% Digital 3% Digital 97% Screen and Other Digital 94% Screen and Other 2028 ~30 billion SALT LIFE AT A GLANCE GROSS MARGIN: 51.6% Delta Apparel, Inc. - March 2023 Investor Presentation 19 Record revenue - Branded retail doors A Innovative digital outreach FY23 Q1 Revenue Year-Over-Year (in millions) BRANDED RETAIL ECOMMERCE SHIPPING Delta Apparel, Inc. - March 2023 Investor Presentation belk ★macy's Home ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number 1-15583 DELTA APPAREL, INC. ______________________________ (Exact name of registrant as specified in its charter) | Georgia ...

Table of Contents SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-K ☑ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For The Fiscal Year Ended October 1, 2022 ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File No. 1-15583 DELTA APPAREL, INC. (Exact name of registrant as specified in its charter) Georgia (State or other jurisdiction of incorporation or organization) 58-2508794 (I.R.S. Employer Ident ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended July 2, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-15583 DELTA APPAREL, INC. (Exact name of registrant as specified in its charter) Georgia (State or Other Jurisdiction of Inco ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 2, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-15583 DELTA APPAREL, INC. (Exact name of registrant as specified in its charter) Georgia (State or Other Jurisdiction of Inc ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended January 1, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-15583 DELTA APPAREL, INC. (Exact name of registrant as specified in its charter) Georgia (State or Other Jurisdiction of I ...

Part I [Business](index=5&type=section&id=Item%201.%20Business) Delta Apparel, Inc. is a vertically-integrated international apparel company operating through two segments, Delta Group and Salt Life Group, with internal manufacturing and a focus on ESG principles - The company operates under two primary segments: **Delta Group** (core activewear and DTG2Go digital printing) and **Salt Life Group** (aspirational lifestyle brand)[23](index=23&type=chunk)[24](index=24&type=chunk)[29](index=29&type=chunk) - A key operational strength is its vertical integration, with over **90%** of apparel units sewn in company-owned or leased facilities across the U.S., El Salvador, Honduras, and Mexico[20](index=20&type=chunk)[31](index=31&type=chunk) - The company emphasizes its **Environmental, Sustainability, and Governance (ESG)** initiatives, aligning disclosures with SASB standards and focusing on reducing environmental impact and responsible sourcing[41](index=41&type=chunk)[63](index=63&type=chunk)[68](index=68&type=chunk) Employee Distribution and Tenure (as of September 2021) | Country | Number of Employees | Tenure ≤ 5 Years | Tenure 6-10 Years | Tenure > 10 Years | | :--- | :--- | :--- | :--- | :--- | | El Salvador | 2,901 | 62% | 17% | 21% | | Honduras | 3,508 | 61% | 20% | 19% | | Mexico | 1,002 | 62% | 13% | 25% | | United States | 1,058 | 71% | 9% | 20% | | **Total** | **8,469** | **63%** | **16%** | **21%** | - Competition in the **Delta Group** is primarily based on price, service, and quality, while the **Salt Life Group** competes on brand recognition, design, and consumer preference[100](index=100&type=chunk)[101](index=101&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company faces strategic, operational, legal, regulatory, and financial risks, including raw material price volatility, COVID-19 disruptions, political instability, cybersecurity threats, and debt covenant adherence - The price and availability of **cotton**, the primary raw material, are prone to significant fluctuations and volatility, potentially impacting gross margins[108](index=108&type=chunk) - The **COVID-19 pandemic** has had and could continue to have a material adverse effect on operations, financial condition, and liquidity due to potential shutdowns and supply chain disruptions[119](index=119&type=chunk)[120](index=120&type=chunk) - A majority of products are manufactured in **Honduras, El Salvador, and Mexico**, exposing the company to political, social, and economic risks[124](index=124&type=chunk) - The business relies on information systems for operations, and data security compromises, such as the **2019 malware intrusion**, could lead to liability and reputational damage[130](index=130&type=chunk)[132](index=132&type=chunk)[134](index=134&type=chunk) - The company's ability to borrow under its credit facility is dependent on maintaining certain financial conditions and covenants, with business deterioration potentially restricting capital access[154](index=154&type=chunk) [Unresolved Staff Comments](index=29&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - No unresolved staff comments[166](index=166&type=chunk) [Properties](index=29&type=section&id=Item%202.%20Properties) As of September 2021, Delta Apparel operates 44 facilities, including key manufacturing sites in Central America and North Carolina, with foreign assets representing 25% of net property, plant, and equipment Facility Summary (as of September 2021) | Category | Owned | Leased | Other | Total | | :--- | :--- | :--- | :--- | :--- | | Manufacturing | 2 | 6 | — | 8 | | Distribution | 2 | 1 | 1 | 4 | | Decoration/distribution | 1 | 7 | 1 | 9 | | Retail stores/showroom | 1 | 17 | — | 18 | | Offices | — | 5 | — | 5 | | **Total** | **6** | **36** | **2** | **44** | - Primary manufacturing facilities are located internationally in **Honduras, Mexico, and El Salvador**, and domestically in **North Carolina**[167](index=167&type=chunk) - As of September 2021, long-lived assets in Honduras, El Salvador, and Mexico collectively represented approximately **25%** of consolidated net property, plant, and equipment[167](index=167&type=chunk) [Legal Proceedings](index=31&type=section&id=Item%203.%20Legal%20Proceedings) The company reports no material pending legal proceedings - No material pending legal proceedings are currently active[170](index=170&type=chunk) [Mine Safety Disclosures](index=31&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[171](index=171&type=chunk) Part II [Market for Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities](index=32&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Shareholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Delta Apparel's common stock trades on NYSE American (DLA), with no dividends paid in FY2021/2020, and $19.0 million of retained earnings available for distributions - The company's common stock is listed on the **NYSE American** under the trading symbol **'DLA'**[174](index=174&type=chunk) - No dividends were declared or paid during fiscal **2021** or **2020**[175](index=175&type=chunk) - As of September 2021, **$19.0 million** of retained earnings were available for potential cash dividends or stock repurchases, an increase from **$8.8 million** in the prior year[175](index=175&type=chunk)[213](index=213&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2021 was a record year for Delta Apparel, with net sales growing 14.6% to $436.8 million and operating margin reaching 7.5%, driven by segment growth and improved gross margins - The company anticipates continued top-line growth and operating profit expansion in fiscal **2022**, projecting all-time record revenue and earnings per share[186](index=186&type=chunk) Fiscal Year 2021 vs. 2020 Performance | Metric | FY 2021 | FY 2020 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $436.8M | $381.0M | +14.6% | | Gross Profit | $101.8M | $68.4M | +49.0% | | Gross Margin | 23.3% | 17.9% | +540 bps | | Operating Profit (Loss) | $32.8M | ($7.1M) | - | | Net Income (Loss) | $20.3M | ($10.6M) | - | | Diluted EPS | $2.86 | ($1.53) | - | - **Delta Group** segment net sales increased **13%** to **$387.0 million**, while **Salt Life Group** segment net sales grew **34%** to **$49.7 million**[188](index=188&type=chunk)[189](index=189&type=chunk) - Cash provided by operating activities was **$25.5 million** in **2021**, compared to **$31.8 million** in **2020**, primarily due to increased inventory levels[202](index=202&type=chunk) - The company plans to spend approximately **$20 million** in capital expenditures in fiscal **2022**, focusing on manufacturing expansion, digital print equipment, and opening seven new Salt Life retail stores[204](index=204&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Delta Apparel is not required to provide this information - The company is a smaller reporting company and is not required to provide this information[232](index=232&type=chunk) [Financial Statements and Supplementary Data](index=42&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section includes the company's Consolidated Financial Statements and Reports of Independent Registered Public Accounting Firms starting on page F-1 - The Consolidated Financial Statements for fiscal years ended **September 2021** and **September 2020** are included in the report starting on page **F-1**[233](index=233&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=42&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - No changes in or disagreements with accountants on accounting and financial disclosure[234](index=234&type=chunk) [Controls and Procedures](index=42&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and internal control over financial reporting were effective as of September 2021, with an unqualified auditor opinion - Management concluded that the company's disclosure controls and procedures were effective as of the evaluation date in **September 2021**[235](index=235&type=chunk) - Based on an evaluation using the **COSO framework**, management concluded that the company's internal control over financial reporting was effective as of **September 2021**[238](index=238&type=chunk) - **Ernst & Young, LLP**, the independent registered public accounting firm, audited and issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting[239](index=239&type=chunk)[243](index=243&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=44&type=section&id=Item%2010.%20Directors,%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement[254](index=254&type=chunk) [Executive Compensation](index=44&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive and director compensation is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement[255](index=255&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=44&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership and equity compensation plan information, including the 2020 Stock Plan approval, is incorporated by reference from the definitive Proxy Statement - Information regarding security ownership is incorporated by reference from the definitive Proxy Statement[255](index=255&type=chunk) - Shareholders approved the **Delta Apparel, Inc. 2020 Stock Plan** on **February 6, 2020**, to replace the expiring 2010 Stock Plan[255](index=255&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=45&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement[260](index=260&type=chunk) [Principal Accountant Fees and Services](index=45&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Details regarding principal accountant fees and services are incorporated by reference from the definitive Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement[261](index=261&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=45&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements, schedules, and exhibits filed as part of the Form 10-K, including auditor reports and various corporate agreements - Lists all financial statements, including the Report of Independent Registered Public Accounting Firms and Consolidated Balance Sheets, Statements of Operations, and Cash Flows[263](index=263&type=chunk) - Provides a detailed listing of exhibits, including articles of incorporation, credit agreements, employment agreements, and stock plans[266](index=266&type=chunk)[268](index=268&type=chunk) [Form 10-K Summary](index=49&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company indicates there is no Form 10-K summary - No Form 10-K summary is provided[272](index=272&type=chunk) Financial Statements and Notes [Consolidated Financial Statements](index=54&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements present the company's financial position and results for FY2021 and FY2020, with FY2021 net sales of $436.8 million and net income of $20.3 million Consolidated Balance Sheet Summary (in thousands) | Account | Sept 2021 | Sept 2020 | | :--- | :--- | :--- | | Total Current Assets | $242,963 | $226,768 | | Total Assets | $434,288 | $420,231 | | Total Current Liabilities | $105,461 | $96,027 | | Total Liabilities | $270,094 | $277,545 | | Total Equity | $164,194 | $142,686 | Consolidated Statement of Operations Summary (in thousands) | Account | FY 2021 | FY 2020 | | :--- | :--- | :--- | | Net Sales | $436,750 | $381,035 | | Gross Profit | $101,880 | $68,375 | | Operating Income (Loss) | $32,711 | ($7,075) | | Net Earnings (Loss) Attributable to Shareholders | $20,296 | ($10,577) | [Notes to Consolidated Financial Statements](index=60&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of accounting policies and financial data, covering revenue recognition, inventory, goodwill, debt, income tax, leases, and segment performance - **Note 4:** Finished goods constituted the largest portion of inventory at **$123.5 million** as of September 2021, up from **$118.0 million** in the prior year[359](index=359&type=chunk) - **Note 6:** As of September 2021, goodwill was **$37.9 million**, with **$18.0 million** allocated to the Delta Group and **$19.9 million** to the Salt Life Group, and net intangible assets were **$26.3 million**[362](index=362&type=chunk) - **Note 8:** Total long-term debt was **$108.7 million** as of September 2021, primarily consisting of **$98.6 million** outstanding on the revolving U.S. credit facility maturing in **2024**[366](index=366&type=chunk)[369](index=369&type=chunk) Note 13: Segment Operating Income (in thousands) | Segment | FY 2021 | FY 2020 | | :--- | :--- | :--- | | Delta Group | $39,956 | $6,609 | | Salt Life Group | $5,793 | $460 | | **Total Segment Operating Income** | **$45,749** | **$7,069** |