Retail-ready segment sales up at Delta Apparel
Delta Apparel, Inc. reported financial results for its fourth quarter and fiscal year ended July 3, 2010.
Fourth Quarter Highlights
• Net sales increased 20.5% to $126.2 million from $104.7 in the year ago period
• Gross margins improved 70 basis points to 23.9%
• Net income increased 40.8% to $5.7 million versus $4.0 million in the prior year
• Diluted EPS increased 36.2% to $0.64 versus $0.47 in the year ago period
Fiscal 2010 Highlights
• Net sales increased 19.5% to a record $424.4 million from $355.2 million in the prior year
• Gross margins improved 220 basis points to 23.7%
• Net income increased 88.8% to $12.2 million versus $6.5 million in fiscal year 2009
• Diluted EPS increased 84.2% to $1.40 compared to $0.76 last fiscal year
Robert W. Humphreys, Chairman and Chief Executive Officer, commented, “We are encouraged to have achieved our seventh consecutive year of sales growth. For the second successive year, each of our business units increased revenue, driving 14% organic growth on top of 8% organic growth in the prior year.
“We continue to gain new customers, expand business relationships with existing customers, add new license and marketing agreements, and expand our value-added services for our customers. Our flexible manufacturing platform is supporting our growth and is currently running near capacity.
“We have recently added equipment at Ceiba Textiles which should enhance our output and we expect to make additional investments as needed in fiscal year 2011 to support our long-term sales growth.”
Retail-Ready Apparel Segment Review
The retail-ready segment sales were $53.8 million in the fourth quarter of fiscal year 2010 compared to $50.0 million in the prior year fourth quarter. The 7.6% fourth quarter organic growth was driven by strong sales to department stores, independent sporting goods stores and outdoor retailers. For the full year, sales in the retail-ready segment grew 26.7%, or $41.7 million, to $197.8 million.
This was achieved from 14% organic sales growth plus the additional revenue from To The Game, which was acquired in the fourth quarter of fiscal year 2009. The Company believes strong consumer demand for its branded and licensed products allowed it to expand product categories and increase retail doors carrying its products, resulting in organic sales growth in fiscal year 2010.
Gross margins in the retail-ready segment were 39.7% in the fourth quarter and 38.7% for the full fiscal year. Operating income was $5.8 million in the fourth quarter and $17.8 million for fiscal year 2010 compared to $17.6 million in the prior fiscal year.
Activewear Apparel Segment Review
The activewear segment had sales of $72.4 million for the quarter ended July 3, 2010, an increase of 32.2% compared to the prior year fourth quarter driven from sales growth in both catalog and private label products. For the full year, revenue increased $27.6 million, or 13.8%, to $226.6 million compared to $199.0 million in the prior year.