Company Announces New Textile and Distribution Capacity Expansions in Honduras - Gildan Activewear Inc. (GIL; TSX and NYSE) today announced its financial results for its second fiscal quarter ended March 30, 2008. The Company also reconfirmed its most recently revised earnings guidance for the full fiscal year, which it had updated on April 29, 2008. In addition, the Company announced plans to construct a third textile facility in Honduras, to support its projected sales growth beyond 2009. Second Quarter Sales and Earnings Gildan reported second quarter net earnings of U.S. $41.7 million and diluted EPS of U.S. $0.34, compared to net earnings of U.S. $21.1 million and diluted EPS of U.S. $0.17 in the second quarter of fiscal 2007. Results for the second quarter of fiscal 2008 include a charge of U.S. $0.8 million or U.S. $0.01 per share to reflect ongoing carrying costs for Canadian and U.S. manufacturing facilities, pursuant to the closure of these facilities in fiscal 2007. Before reflecting the restructuring charges in both fiscal years, adjusted net earnings for the second quarter were U.S. $42.5 million, or U.S. $0.35 per share, up respectively 13.3% and 12.9% from adjusted net earnings of U.S. $37.5 million, or U.S. $0.31 per share, in the second quarter of last year. The growth in EPS was due to more favourable unit sales volumes, selling prices and product-mix for activewear, partially offset by increased selling, general and administrative, depreciation and interest expenses, and a higher effective income tax rate, as well as the U.S. $0.07 per share negative impact of continuing issues arising from the integration of the Kentucky Derby Hosiery acquisition into Gildan's retail business. The Company did not achieve its previous guidance for the second quarter of approximately U.S. $0.42 adjusted diluted EPS, which it had provided on January 30, 2008, as a result of the retail integration issues combined with lower than projected unit sales growth in activewear resulting from a shortfall in production for the Dominican Republic textile facility, partially offset by more favourable activewear product-mix and lower than anticipated promotional discounts in the U.S. wholesale distributor channel. Sales in the second quarter amounted to U.S. $293.8 million, up 26.5% from U.S. $232.1 million in the second quarter of last year. The increase in sales revenues was due to an increase of 98.4% in sock sales due to the acquisition of Prewett and new retail sock programs obtained in fiscal 2007, a 7.5% increase in unit volumes for activewear, an approximate 3% increase in activewear unit selling prices and a more favourable activewear product-mix. Growth in activewear unit volumes was constrained by lower than anticipated production, including delays in the introduction of new high-value ring-spun T-shirt and sport shirt products at the Company's textile facility in the Dominican Republic. The increase in sock sales was net of the impact of exiting unprofitable sock product-lines which did not fit with Gildan's strategy to focus primarily on high-volume basic sock programs in the U.S. mass retail channel. In addition, average selling prices for socks were reduced, as selling prices for new sock programs were based on the projected cost structure of Gildan's new sock facility in Honduras, which is currently being ramped up to full capacity. The growth in activewear unit sales was due to continuing market share penetration in T-shirts and fleece in the U.S. wholesale distributor channel. The table below summarizes data from the S.T.A.R.S. report produced by ACNielsen Market Decisions, which tracks unit volume shipments from U.S. wholesale distributors to U.S. screenprinters, for the quarter ended March 31, 2008.

Gildan Market Share Q2 2008 Gildan Market Share Q2 2007 Gildan Unit Growth Q2 2008 vs. Q2 2007 Industry Unit GrowthQ2 2008 vs. Q2 2007 50.1% 47.4% All activewear products (0.4)% (5.9)% 50.7% 48.2% T-shirts (0.7)% (5.9)% 48.8% 42.5% Fleece 12.4% (1.9)% 35.5% 35.7% Sport shirts (14.2)% (13.6)%

The Company achieved record market shares in the T-shirt and fleece categories during the second quarter of fiscal 2008. The Company believes that the 5.9% reduction in overall industry shipments for T-shirts in the quarter is attributable to unseasonably cold spring weather and timing delays in screenprinter purchases of promotional white T-shirts. The Company had a strong open order position during the second quarter, which has significantly further increased since the quarter-end, and believes that demand for its products in the U.S. wholesale distributor channel continues to be strong. The Company continues to believe that overall demand for activewear products in the screenprint channel has not at this time been materially impacted by the weakening of overall economic conditions and the downturn in consumer spending. Unit shipments of activewear to Europe increased by 1.1% during the quarter. The slower growth in shipments to Europe in the quarter was also due to the shortfall in production and delay in new product introductions as a result of the issues in the Dominican Republic textile facility. Gross margins in the second quarter of fiscal 2008 were 33.9%, the same as in the second quarter of fiscal 2007. Gross margins in the second quarter compared to last year were positively impacted by higher activewear selling prices and lower promotional discounts, a higher-valued activewear product-mix and increased manufacturing efficiencies from the Company's manufacturing operations in Central America. These positive factors were offset by a higher proportion of sock sales, which currently generate lower gross margins than activewear, production inefficiencies in the Dominican Republic facility, higher energy costs, the impact of inventory write-downs in order to accelerate the liquidation of sock product-lines which have been discontinued, and additional costs incurred to service mass-market retailers during the integration of the Company's retail information systems. Selling, general and administrative expenses were U.S. $36.6 million, or 12.5% of sales, compared to U.S. $28.5 million, or 12.3% of sales in the second quarter of fiscal 2007. The increase in selling, general and administrative expenses is due to the acquisition of Prewett, higher distribution expenses, increased expenditures for the development of information systems, and the impact of the stronger Canadian dollar on corporate administrative costs. The increase of U.S. $5.6 million in depreciation and amortization costs was due to the Company's continued investments in new capacity expansion, and the impact of the Prewett acquisition. Interest expense in the second quarter increased by U.S. $1.0 million compared to the second quarter of last year, due to the increased utilization of the Company's revolving long-term credit facility to fund the acquisition of Prewett on October 15, 2007, partially offset by the impact of lower interest rates. The Company's effective income tax rate for the second quarter was approximately 7.7%, compared to 5.0% in the second quarter of last year, excluding the impact of restructuring and other charges. The increase in the effective income tax rate was primarily due to the higher tax rate attributable to the Company's U.S. sock business, which is currently taxed at higher effective income tax rates. More