Home / Knowledge / News / Apparel/Garments / Apparel margins drop due to higher cotton costs; Ennis
Apparel margins drop due to higher cotton costs; Ennis
26
Apr '11
Ennis Inc reported financial results for the quarter and the year ended February 28, 2011.

Highlights

• Revenues for the year increased by $32.3 million over the same period last year, or 6.2%. For the quarter revenues were up $10.0 million over the previous year, or 8.2%.
• Gross profit margins increased 200 basis points (“bps”) over the prior year, from 26.1% to 28.1% for the fiscal year ended February 28, 2010 and 2011, respectively.
• Diluted earnings per share increased by 26.5% for the fiscal year, from $1.36 per share for fiscal year 2010 to $1.72 per share for fiscal year 2011.

Keith Walters, Chairman, Chief Executive Officer and President, commented as follows, “We are pleased with the operational results for the year, especially considering all the challenges and the start-up of our new manufacturing facility located in Agua Prieta, Mexico. Operationally, both sectors showed positive margins improvements for the year. Our Print margins were up 70 bps, while Apparel margins were up 350 bps for the year. The Apparel sector continued to show strong sales growth, with an increase of 17.9% for the quarter.

“While we have been successful to date in managing the increases in our raw material costs, we continue to be concerned with the potential impact of cotton pricing on our operational results for fiscal year 2012. Our ability to continue to manage this potential cost increase will be dependent upon many factors, a number of which are outside our control. Examples are: the continued recent positive development in employment numbers, the availability of cotton, the impact of current gasoline prices on consumers discretionary spending and lastly, the pricing policies of our competitors.

“The construction of our new apparel manufacturing facility in Agua Prieta, Mexico continues to progress and nears completion. We continue to test processes, calibrate equipment and train employees, but expect to be producing greater than 1.0 million pounds of fabric out of this facility during the upcoming quarter. We continue to anticipate potential cost savings to be realized once this facility reaches its full production capacity. Many challenges will present themselves for fiscal year 2012; however, we feel confident in being able to meet them. We will continue to be vigilant to deliver the planned results.”

Financial Overview

For the quarter, consolidated net sales increased by $10.0 million, or 8.2%, from $121.4 million for the quarter ended February 28, 2010 to $131.4 million for the quarter ended February 28, 2011. Print sales for the quarter were $66.2 million, compared to $66.1 million for the same quarter last year, or an increase of 0.2%.

Apparel sales for the quarter were $65.2 million, compared to $55.3 million for the same quarter last year, or an increase of 17.9%. Overall gross profit margins ("margins") during the quarter decreased slightly from 28.2% for the three months ended February 28, 2010 to 27.5% for the three months ended February 28, 2011. Print margins increased from 26.6% to 26.9%, while our Apparel margins decreased from 30.1% to 28.0%, due to higher cotton costs and the impact of the start-up of our Agua Prieta facility.

Must ReadView All

Apparel/Garments | On 5th Dec 2016

EC proposes new tax rules to support e-commerce in EU

The European Commission (EC) has unveiled a series of measures to...

Apparel/Garments | On 5th Dec 2016

Traders to intensify adoption of digital payments

Adoption of digital payments in their existing business format would...

Textiles | On 5th Dec 2016

US textile & apparel exports down 6.44% in Jan-Sept ’16

The exports of textile and apparel from United States were down 6.44...

Interviews View All

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Jurgen Gauger
Spreadshirt

‘Buying crowdsourced or creative designs are much more appealing to the...

Amrit Sethia
SOIE

‘The intimatewear category in India is slowly becoming trend-sensitive.’

Eamonn Tighe
Nature Works LLC

Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Urs Stalder
Sanitized AG

Urs Stalder, CEO, Sanitized AG, talks about the increasing use of hygiene...

Robert Brunner
Devereux

Golfwear and menswear brand Devereux is set for greener pastures. Robert...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

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