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Swimwear sales drive Tefron's quarterly revenues

16
May '08

Tefron Ltd a leading producer of seamless intimate apparel and engineered-for-performance active wear, announced financial results for the first quarter of 2008.

First quarter revenues were $50.9 million, representing a 4.5% increase from the first quarter of 2007 revenues of $48.8 million.

The increase in revenues in the quarter was due to an increase in sales of swimwear, including revenues delayed from the fourth quarter of 2007 and an increase in sales of active-wear products. This increase was partly offset by a reduction in sales of intimate apparel .

First quarter gross margin was 12.4% compared with a gross margin of 19.1% in the first quarter of 2007. Operating income for the quarter was $0.1 million (0.3% of revenues), as compared with an operating income of $5.0 million (10.2% of revenues) in the first quarter of 2007.

Net loss for the quarter was $0.7 million, or $0.03 per diluted share, as compared with net income of $3.8 million (7.8% of revenues), or $0.17 per diluted share, in the first quarter of 2007.

The decline in gross and operating margins in the quarter compared with the first quarter of last year was primarily due to the significant devaluation of the US Dollar versus the New Israeli Shekel, the higher proportion of Cut & Sew products in the active-wear sales mix which have a lower profitability than those of the Seamless products, and finally, the continuing short-term manufacturing challenges faced in the Hi-Tex division.

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