Home / Knowledge / News / Apparel/Garments / Apparel retailer G&K Services Q1FY'14 sales up 3.1%
Apparel retailer G&K Services Q1FY'14 sales up 3.1%
29
Oct '13
G&K Services, Inc. reported operating results for the first quarter of its fiscal year 2014, which ended on September 28, 2013. Revenue in the quarter grew by 3.1 percent to $229.3 million, up from $222.4 million in last year’s first quarter, driven by growth in rental operations, partially offset by lower revenue from direct sales and a lower Canadian exchange rate.

First quarter adjusted earnings per diluted share grew 8 percent to $0.67, up from $0.62 per diluted share in the prior year period. Adjusted earnings in the quarter excluded a $0.07 per share benefit from the previously announced change in estimated merchandise amortization lives and a $0.05 per share charge for an increase to the company’s estimated multi-employer pension plan withdrawal liability. Including these items, the company recorded net earnings per diluted share of $0.69.

“Our team continues to make terrific progress,” said Douglas A. Milroy, Chief Executive Officer. “We delivered another quarter of profitable growth, with solid revenue gains and operating margin improving to 10.2 percent, the highest level in over a decade.”

Income Statement Review

First quarter revenue from rental operations grew 4.7 percent to $213.0 million, compared to $203.5 million in the prior-year quarter. The rental organic growth rate, which adjusts for the impact of currency exchange rate differences, acquisitions and divestitures, was 3.7 percent. First quarter revenue from direct sales decreased to $16.3 million, from $19.0 million in the prior-year, primarily due to lower program sales. Direct sale revenue in the prior year was higher due to sales from a large new customer program launch.

First quarter adjusted operating income grew 19 percent to $23.3 million, compared to $19.5 million in the prior year quarter. Adjusted operating margin expanded to 10.2 percent, a 140 basis point increase from 8.8 percent in last year’s first quarter.

The improvement in adjusted operating margin was primarily driven by improved rental gross margin and increased operating leverage from revenue growth, partially offset by higher selling and administrative costs.

Rental operations’ costs related to production, merchandise, and delivery were all lower as a percentage of revenue compared to the prior year. Operating margin also benefited from lower health insurance and workers compensation costs.

First quarter adjusted operating income and adjusted operating margin excluded the previously mentioned benefit from a change in estimated merchandise amortization lives and the charge related to an increase in the company’s estimated multi-employer pension plan withdrawal liability. Including these items, operating income in the first quarter was $23.9 million and operating margin was 10.4 percent

Click here to read full results

G&K Services

Must ReadView All

Textiles | On 10th Dec 2016

India’s 2016-17 cotton import to touch 17 lakh bales

The import of cotton from international markets by spinning mills in...

Textiles | On 10th Dec 2016

US textile & apparel imports fall 6.50% in Jan-Oct ’16

The import of textiles and apparel by United States dropped 6.50 per...

Textiles | On 10th Dec 2016

Indian textile hubs adopt cashless payment modes

The textile ministry is promoting cashless payment within the...

Interviews View All

Jim Desai
Blaiva Fabricaa

Fashion industry likely to remain labour-intensive in coming years

Priyanka
Studio Priyanka Rajiv

‘To reinvent the age-old tradition of embroidery to suit demographics and...

Angelina Francesca Cheang
MY ANJE

'Consumers in the age-group 21 to 38 are driving the activewear trend'

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Kerem Durdag
Biovation II LLC

Kerem Durdag, CEO, Biovation II LLC, provides an insight into future...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
December 2016

December 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


Advanced Search