The company reported sales of US$ 334.5 million for the first quarter of 2018, representing a 6% increase compared to US$ 315.7 million for the same quarter last year. “We’re pleased to be off to a solid start to 2018. First quarter sales rose in most segments, particularly Schiesser and Delta Israel, while profitability benefitted from rising EBIT margins at Delta Israel and Delta Premium Brands,” commented Isaac Dabah, CEO of Delta Galil.

“The investments we made in our business over the last two years have put us in a stronger position today, and we’re seeing steady and diversified growth. We expect to continue on a solid track, and with a strong balance sheet in place, we have the funds necessary to take advantage of the right market opportunities as they arise.”

Other results

Operating profit was US$ 14 million for the first quarter of 2018, a 37% increase from US$ 10.2 million in the first quarter of 2017. Operating profit before one-time items was US$ 14 million for the first quarter of 2018, compared to US$ 12.9 million in the first quarter of 2017, representing an 8% increase.

EBITDA was US$ 21.4 million in the first quarter of 2018, up 12% from US$ 19.1 million in the same quarter last year. Operating cash flow was negative US$ 30.3 million for the first quarter of 2018, compared to negative US$ 13.1 million in the first quarter of 2017.

Expanding presence

“We announced separately yesterday that we named former Chief Merchandising Officer of Macy’s Tim Baxter as the Chief Executive Officer of Delta Galil Premium Brands. Tim is an extremely accomplished retail and fashion merchandising executive, whose highly profitable strategic plans, licensing deals, and partnerships at Macy’s with many of the world’s most renowned brands, will prove instrumental in leading Seven for All Mankind and Splendid into their next phase of growth,” added Mr Dabah.

“Also as we recently announced, we have signed an option to acquire leading French men’s underwear group Eminence, which includes Eminence, a premium underwear brand for men, along with ATHENA and Liabel – mass-market underwear brands for men, women and kids. The deal, which is expected to close in the third quarter, would significantly expand our presence and branded business in France and Italy, while providing the potential for a platform for growth.”

“Looking ahead, we will continue to pursue growth both organically and through acquisitions – with a sharp focus on driving innovation, excellence and shareholder value.”

Financial guidance

Delta Galil reaffirmed its 2018 financial guidance. Full-year 2018 net income is expected to range between US$ 54 million-US$ 59 million, representing an increase of 7%-16% from 2017 actual net income of US$ 50.7 million. Full-year 2018 sales are expected to range between US$ 1,400 million-US$ 1,440 million, representing an increase of 2%-5% from 2017 actual sales of US$ 1,368.1 million.

Full-year 2018 EBIT is expected to range between US$ 91 million-US$ 96 million, representing an increase of 4%-10% from 2017 actual EBIT of US$ 87.4 million. Full-year 2018 EBITDA is expected to range between US$ 119 million-US$ 125 million, representing an increase of 3%-8% from 2017 actual EBITDA of US$ 115.9 million.

www.deltagalil.com