Home / Knowledge / News / Apparel/Garments / G&K surpasses $1 billion in fiscal year revenue

G&K surpasses $1 billion in fiscal year revenue

12
Aug '08
G&K Services Inc reported record revenue for the fiscal year ended June 28, 2008 of $1,002.4 million, a 7.8 percent increase from previous year revenue of $929.5 million.

The increase in revenue was driven by rental organic growth, strong revenue contribution from acquisitions and the benefit of foreign currency translation.

For the fiscal year, earnings were a record $2.27 per diluted share, a 12.4 percent increase from $2.02 per diluted share in the prior fiscal year.

The increase in earnings per diluted share was driven by a 14.1 percent improvement in operating income as a result of leverage from revenue growth, improved productivity and lower merchandise costs.

The growth in operating income was achieved despite continued economic softness, higher energy costs, lower contribution from direct sales and expenses related to systems implementation activities.

Fiscal 2008 earnings per diluted share were also impacted by a higher effective tax rate of 38.5 percent as compared to the prior year tax rate of 34.0 percent. The lower effective tax rate resulted in a $0.14 per diluted share benefit in the prior year.

“Surpassing one billion in annual revenue marks another milestone we've achieved since introducing our new strategic vision four years ago,” said Richard Marcantonio, chairman and chief executive officer.

“I would like to thank each member of the G&K team for their continued hard work and dedication in driving this record level of revenue, our thirty-ninth consecutive year of revenue growth.

In addition to reporting solid top-line revenue growth, we delivered improved operating margins, record earnings and record cash flow for the fiscal year.

Overall, we're pleased to report another strong fiscal year, despite challenging economic conditions. We'll continue to execute against our long-term strategic plan to drive further positive momentum and achieve our vision of being the market leader in enhancing image and safety in the workplace through innovation.”

For the fourth quarter ended June 28, 2008, total revenue was $252.2 million, a 4.9 percent increase over prior-year revenue of $240.4 million. The increase in fourth quarter revenue was driven by rental organic growth, revenue contribution from acquisitions and the benefit of foreign currency translation.

The company reported fourth quarter earnings of $0.55 per diluted share, which exceeded expectations. Fourth quarter earnings per diluted share were driven by leverage from overall revenue growth, savings from productivity initiatives and the accretive benefit of continued share repurchase activity.

These benefits were offset by higher energy costs, increased product input prices, increased interest expense associated with the higher debt levels required to fund acquisitions and share repurchases and a higher effective tax rate.

Prior-year fourth quarter earnings of $0.57 per diluted share reflected a lower effective tax rate of 34.6 percent. The lower effective tax rate resulted in a $0.05 per diluted share benefit in the prior-year period.

Fourth quarter revenue from G&K's rental business increased to $234.5 million, up 7.0 percent over the prior-year period. The company's organic rental growth rate was approximately 2.0 percent in the quarter.

Organic rental growth continues to reflect solid new account sales, route sales performance and price increases, offset by an increase in economic-driven customer attrition and a reduction in employment levels within certain industries.

Direct sale revenue was $17.7 million, compared to $21.3 million in the prior-year period. Direct sales volume compared to the year-ago period continues to be impacted by weakness in certain customer end-markets and soft overall economic conditions.


Must ReadView All

Pic: Shutterstock

Textiles | On 27th Feb 2020

Australia willing to consider FTA with India on RCEP lines

Australia is willing to consider a bilateral free trade agreement...

Pic: Shutterstock

Apparel/Garments | On 27th Feb 2020

Hun Sen asks PRC garment investors not to leave Cambodia

Prime Minister Hun Sen recently again told Chinese garment sector...

Pic: Shutterstock

Textiles | On 27th Feb 2020

ADD removal on PTA respite to man-made textiles: Ind-Ra

The withdrawal of anti-dumping duty (ADD) on purified terephthalic...

Interviews View All

Sonia Agarwal, Whitenife

Sonia Agarwal
Whitenife

‘The terms eco-friendly and organic are common but everyone perceives them ...

Amardeep Singh, Orient Craft

Amardeep Singh
Orient Craft

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

Vasanth Kumar, Max Fashion India

Vasanth Kumar
Max Fashion India

‘Traditional high-street retailers are now willing to offer franchisees to ...

Tom,

Tom

<div>Inkbank is a leading supplier of inkjet inks and inkjet printing...

Abhishek Dhanuka,

Abhishek Dhanuka

Vyom International Pvt Ltd, established in 2002, is one of Surat's leading ...

Abhishek Ralli,

Abhishek Ralli

Guide group is a government recognised manufacturing house engaged in the...

Keith McMillen, Bebop Sensors

Keith McMillen
Bebop Sensors

Bebop Sensors' smart fabrics allows for a new level of interaction between ...

Eric Scholler, Groz-Beckert

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Tiasha Renganathan, Twinery Innovations by MAS

Tiasha Renganathan
Twinery Innovations by MAS

Twinery-Innovations by MAS is the innovation arm of Sri Lankan company MAS ...

Pranav Mishra, Huemn

Pranav Mishra
Huemn

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

Chandani Sahi, By Chandani

Chandani Sahi
By Chandani

By Chandani is a womenswear prêt couture brand with fusion silhouettes by...

Samar Firdos, Arvind Ltd

Samar Firdos
Arvind Ltd

<b>Samar Firdos</b>, Chief Manager (Design) at Lifestyle Apparel Denim...

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

Leave your Comments


February 2020

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


Advanced Search