Delta Galil sales zoom 40% in Q4 of 2012

Delta Galil reported record quarterly sales of $246.6 million for the three months ended December 31, 2012, up from $176.4 million for the same quarter last year, an increase of 40%. For the full year 2012, sales reached a record $817.8 million, a 20% increase over sales of $678.8 million in 2011.

The strong top-line growth in 2012 reflected Delta Galil’s acquisition of Schiesser Group, completed in July 2012, as well as a sharp increase in sales in Europe, mainly in Germany, positive momentum in the U.S. mass market channel.

Operating income was $19.7 million in the fourth quarter of 2012, rising 73% from the $11.4 million reported in the same quarter of 2011. For the full year 2012, operating income excluding capital gains and non-recurring items was $50.7 million, compared to $39.7 million in 2011, a 28% increase.

Net income attributed to shareholders was $13.8 million in the fourth quarter of 2012, compared to $8.3 million in the same quarter of 2011, a 66% increase. For the full year 2012, income attributed to shareholders excluding capital gains and non-recurring items was $33.8 million, rising 23% from $23.4 million in 2011.

Diluted earnings per share attributed to shareholders excluding capital gains and non-recurring items was $0.55 for the 2012 fourth quarter and $1.37 for the year. In the respective 2011 periods, the comparable amounts were $0.36 and $1.15, respectively.

Net income for the year attributed to shareholders was $56.9 million compared to $27.4 million in 2011, an increase of 107%.

Results for the full year 2012 included a capital gain of $19.9 million from the sale of real estate, expenses of $1.2 million from the Schiesser acquisition, a net gain of $12.2 million due to negative goodwill attributed to Schiesser acquisition, partially offset by a write-down of unused fixed assets of $1.3 million, and restructuring expenses of $5.4 million.

Management Comment: Strategic Transformation and Growth

Isaac Dabah, CEO of Delta Galil, stated: “In 2012 we delivered exceptional top-line and bottom-line performance and made great strides in executing Delta Galil’s long-term strategies to transform the Company into a leading, diversified global competitor in branded and private label intimate apparel. We increased our branded business and our European footprint through the Schiesser acquisition, further penetrated the U.S. mass market channel, and expanded our socks category and U.S. kids business, through our recent acquisition of Little Miss Matched.

“Our outlook for 2013 calls for Delta Galil to approach $1 billion in sales, accompanied by further growth in profitability. We plan to get there through continued organic growth in areas such as in Delta USA, Socks business and Delta Israel retail operations. We have increased our guidance to 2013 from $55-$60 million EBIT to $57-$62 million.”