Gildan Activewear (US:GIL) ZACKS·2025-02-20 18:55Core Insights - Gildan Activewear Inc. reported strong fourth-quarter 2024 results, with revenues and earnings exceeding expectations and showing year-over-year growth, driven by the execution of its GSG strategy [1][2] Financial Performance - Adjusted earnings were 83 cents per share, beating the Zacks Consensus Estimate of 80 cents, and increased by 10.7% from 75 cents in the prior-year quarter [2] - Net sales reached $821.5 million, a 5% year-over-year increase, surpassing the Zacks Consensus Estimate of $793 million [2] - Activewear sales totaled $714.1 million, marking a 10.9% year-over-year increase, supported by higher sales volumes and market share gains [3] - Hosiery and Underwear category net sales declined 22.6% year over year to $107.4 million, primarily due to the Under Armour phase-out, but excluding this impact, sales increased in the high-single digits [4] Regional Performance - U.S. sales increased by 4.4% to $730.6 million from $699.5 million in the prior year [6] - Canadian sales declined by 10.7% to $26.5 million from $29.7 million [6] - International sales grew by 20.3% to $64.4 million from $53.5 million in the previous year [6] Margins and Costs - Adjusted gross profit was $253 million, up 6.9% year over year, with an adjusted gross margin increase of 60 basis points to 30.8% due to lower raw material costs [7] - Adjusted SG&A expenses declined by 5% year over year to $77.9 million, with a 100 basis point decrease as a percentage of net sales [7] - Adjusted operating income improved by 13.3% to $175.1 million, with an adjusted operating margin increase of 160 basis points to 21.3% [8] - Adjusted EBITDA totaled $208.4 million, representing a year-over-year increase of 12.4%, with an adjusted EBITDA margin expansion of 170 basis points to 25.4% [8] Other Financials - Cash and cash equivalents at the end of the quarter were $98.8 million, with long-term debt of $1.24 billion and stockholders' equity of $1.46 billion [9] - Cash flows from operating activities were $210.5 million [9] 2025 Outlook - For 2025, net sales growth is expected to be in the mid-single digits year over year, with an adjusted operating margin projected to improve by 50 basis points [10] - Adjusted earnings are anticipated to be between $3.38 and $3.58 per share, indicating a year-over-year increase of 13-19% [10] - Free cash flow is projected to exceed $450 million [10] - For Q1 2025, net sales are expected to increase in the low-single digits, with mid-single-digit growth projected when excluding the Under Armour impacts [11]