All-Time High Sales, Operating Income and EPS Distinguish 4th
Quarter and Full Year Performance
Increase Guidance for 2013
-
Sales reached $246.6 million in the 2012 fourth quarter, up 40% from
the same period of 2011.
-
Income was $13.9 million in the 2012 fourth quarter, a 66% increase
from a year ago.
-
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 full year, up from $0.36 and $1.15,
respectively, for the 2011 periods.
-
Delta Galil achieved its 13th consecutive quarter of
year-over-year sales growth.
-
Operating cash flow was $72.9 million for 2012, up 101% from $36.3
million in the prior year.
-
The Board of Directors declared a dividend of approximately $2.5
million, or $0.1034 per share, to be distributed on March 12, 2013.
The determining and "ex-dividend" date will be February 27, 2013.
-
The Company completed the repurchase of approximately $1.3 million in
Delta Galil common stock.
-
Financial guidance for 2013 calls for diluted EPS of $1.51-1.59 on
sales of $910 million to $920 million.
-
Isaac Dabah, CEO of Delta Galil, noted: “We are very proud to achieve
a consistent 4 years growth delivering 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 apparel.”
TEL AVIV, Israel--(BUSINESS WIRE)--Delta Galil Industries, Ltd. (DELT/Tel Aviv Stock Exchange,
DELTY.PK/OTCQX), the global manufacturer and marketer of branded and
private label apparel products for men, women and children, today
reported its financial results for the fourth quarter and full year 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.”
Cash Flow, Equity, Dividend Declaration
Operating cash flow increased to $32.7 million for the 2012 fourth
quarter and $72.9 million for the full year, up from $21.1 million and
$36.3 million for the respective 2011 periods.
EBITDA rose by 66% to $24.1 million in the 2012 fourth quarter from
$14.5 million in the same period of 2011. For the full year 2012, EBITDA
grew by 26% to $64.8 million, from $51.5 million in 2011.
Equity on December 31, 2012 was a record $277.8 million, or 50% of the
total balance sheet, compared to $217.2 million, or 49% of the balance
sheet a year earlier.
Delta Galil declared a dividend of $2.5 million, or $0.1034 per share,
to be distributed on March 12, 2013. The determining and "ex-dividend"
date will be February 27, 2013. This brings total dividend declared for
2012 to $8.5 million or $0.3566 per share.
Strong Outlook for 2013
Delta Galil increasing its financial guidance for 2013, calling for
higher EBIT and net profit than originally estimated, The following
forecast excludes the effect of any one-time items, net of tax:
-
Full-year 2013 sales are estimated to range from $910 million to $920
million, which would constitute an average increase of 12% compared to
2012 actual.
-
Full-year 2013 EBIT is estimated to range between $57 million and $62
million, which would constitute an average increase of 17% compared to
2012 actual.
-
Full-year 2013 net profit is estimated to range between $38 million
and $40 million, which would constitute an average increase of 15%
compared to 2012 actual.
-
Full-year 2013 diluted EPS is estimated to range between $1.51 and
$1.59, which would constitute an average increase of 13% compared to
the 2012 actual.
|
|
|
|
|
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated
Balance Sheets
As of December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
Thousands of Dollars
|
|
Assets
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
45,475
|
|
|
65,760
|
|
Restricted cash
|
|
|
2,822
|
|
|
-
|
|
Other accounts receivable:
|
|
|
|
|
|
|
|
Trade receivables
|
|
|
108,735
|
|
|
103,444
|
|
Taxes on income receivable
|
|
|
125
|
|
|
1,434
|
|
Others
|
|
|
12,124
|
|
|
9,770
|
|
Financial Derivative
|
|
|
719
|
|
|
-
|
|
Inventories
|
|
|
150,309
|
|
|
110,824
|
|
Assets classified as held for sale
|
|
|
6,456
|
|
|
1,766
|
|
Total current assets
|
|
|
326,765
|
|
|
292,998
|
|
Non-current assets:
|
|
|
|
|
|
|
|
Long-term pre-paid expenses
|
|
|
562
|
|
|
322
|
|
Investment property
|
|
|
4,795
|
|
|
-
|
|
Long-term receivables
|
|
|
12,710
|
|
|
1,202
|
|
Fixed assets, net of accumulated depreciation
|
|
|
93,019
|
|
|
64,184
|
|
Intangible assets, net of accumulated amortization
|
|
|
111,482
|
|
|
77,390
|
|
Deferred tax assets
|
|
|
8,833
|
|
|
7,014
|
|
Financial Derivative
|
|
|
1,045
|
|
|
-
|
|
Total non-current assets
|
|
|
232,446
|
|
|
150,112
|
|
Total assets
|
|
|
559,211
|
|
|
443,110
|
|
|
|
|
December 31
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
Thousands of Dollars
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Short-term bank loans
|
|
|
40,175
|
|
|
62,053
|
|
Current maturities of long-term loans from banking corporations
|
|
|
1,357
|
|
|
2,110
|
|
Current maturities of Debentures
|
|
|
15,965
|
|
|
12,367
|
|
Financial Derivative
|
|
|
-
|
|
|
297
|
|
Other accounts payable:
|
|
|
|
|
|
|
|
Trade payables
|
|
|
72,351
|
|
|
55,920
|
|
Taxes on income – payable
|
|
|
5,029
|
|
|
1,770
|
|
Others
|
|
|
47,479
|
|
|
39,096
|
|
Total current liabilities
|
|
|
182,356
|
|
|
173,613
|
|
|
|
|
|
|
|
|
|
Non-current liabilities:
|
|
|
|
|
|
|
|
Loans from financial institutions, less current maturities
|
|
|
150
|
|
|
1,504
|
|
Severance pay over liabilities from termination of employer –
employee relations less plan assets
|
|
|
2,679
|
|
|
1,183
|
|
Other non-current liabilities
|
|
|
13,543
|
|
|
3,900
|
|
Debentures
|
|
|
79,323
|
|
|
41,506
|
|
Financial Derivative
|
|
|
-
|
|
|
2,978
|
|
Reserve for deferred taxes
|
|
|
3,361
|
|
|
1,182
|
|
Total non-current liabilities
|
|
|
99,056
|
|
|
52,253
|
|
Total liabilities
|
|
|
281,412
|
|
|
225,866
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
Equity attributable equity holders of the
parent company:
|
|
|
|
|
|
|
|
Share capital
|
|
|
23,311
|
|
|
23,106
|
|
Share premium
|
|
|
124,220
|
|
|
121,216
|
|
Other capital reserves
|
|
|
8,736
|
|
|
(633)
|
|
Retained earnings
|
|
|
130,364
|
|
|
81,084
|
|
Treasury shares
|
|
|
(10,996)
|
|
|
(9,700)
|
|
|
|
|
275,635
|
|
|
215,073
|
|
Minority interests
|
|
|
2,164
|
|
|
2,171
|
|
Total equity
|
|
|
277,799
|
|
|
217,244
|
|
Total liabilities and equity
|
|
|
559,211
|
|
|
443,100
|
The enclosed notes constitute an integral part of these Financial
Statements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated
Statement of Comprehensive Income –(Non GAAP)
For the 3-month
and 12-month periods ending December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended December 31
|
|
|
|
Three months ended December 31
|
|
|
|
|
|
2012
|
|
2011
|
|
% Increase
|
|
2012
|
|
2011
|
|
% Increase
|
|
|
|
Thousands of Dollars
|
|
|
Thousands of Dollars
|
|
|
Sales
|
|
817,782
|
|
678,819
|
|
20%
|
|
246,570
|
|
176,388
|
|
40%
|
|
Cost of sales
|
|
633,945
|
|
542,496
|
|
|
|
182,864
|
|
139,006
|
|
|
|
Gross profit
|
|
183,837
|
|
136,323
|
|
|
|
63,706
|
|
37,382
|
|
|
|
% of sales
|
|
22.5%
|
|
20.1%
|
|
|
|
25.8%
|
|
21.2%
|
|
|
|
Selling and marketing expenses
|
|
107,059
|
|
73,815
|
|
45%
|
|
36,632
|
|
19,110
|
|
92%
|
|
% of sales
|
|
13.1%
|
|
10.9%
|
|
|
|
14.9%
|
|
10.8%
|
|
|
|
Administrative and general expenses
|
|
26,691
|
|
25,705
|
|
4%
|
|
7,497
|
|
6,936
|
|
8%
|
|
% of sales
|
|
3.3%
|
|
3.8%
|
|
|
|
3.0%
|
|
3.9%
|
|
|
|
Other income (expenses), net
|
|
571
|
|
2,858
|
|
|
|
103
|
|
70
|
|
|
|
Operating income excluding capital gains and non-recurring
items
|
|
50,658
|
|
39,661
|
|
28%
|
|
19,680
|
|
11,406
|
|
72%
|
|
% of sales
|
|
6.2%
|
|
5.8%
|
|
|
|
8.0%
|
|
6.5%
|
|
|
|
Capital gain from selling of asset held for sale
|
|
19,910
|
|
|
|
|
|
-
|
|
-
|
|
|
|
Schiesser acquisition cost
|
|
1,160
|
|
-
|
|
|
|
-
|
|
-
|
|
|
|
Net income derived from adjustments due to Purchase Price
Allocation of Schiesser*
|
|
12,163
|
|
-
|
|
|
|
-
|
|
-
|
|
|
|
Impairment of fixed assets
|
|
1,309
|
|
-
|
|
|
|
-
|
|
-
|
|
|
|
Restructuring expenses
|
|
5,424
|
|
-
|
|
|
|
-
|
|
-
|
|
|
|
Operating income
|
|
74,838
|
|
39,661
|
|
89%
|
|
19,680
|
|
11,406
|
|
72%
|
|
Finance expenses, net
|
|
8,925
|
|
7,077
|
|
26%
|
|
2,120
|
|
1,090
|
|
94%
|
|
Profit before tax on income
|
|
65,913
|
|
32,584
|
|
|
|
17,560
|
|
10,316
|
|
|
|
Taxes on income
|
|
9,029
|
|
5,009
|
|
|
|
3,691
|
|
1,945
|
|
|
|
Equity income
|
|
93
|
|
-
|
|
|
|
-
|
|
-
|
|
|
|
Income for the period
|
|
56,977
|
|
27,575
|
|
|
|
13,869
|
|
8,371
|
|
|
|
Income for period excluding capital gain and non-recurring items,
net for period
|
|
33,920
|
|
27,575
|
|
37%
|
|
13,869
|
|
8,371
|
|
66%
|
|
Attribution of net earnings for the period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
To shareholders of the parent company
|
|
56,857
|
|
27,441
|
|
|
|
13,839
|
|
8,330
|
|
|
|
To minority interests
|
|
120
|
|
134
|
|
|
|
30
|
|
41
|
|
|
|
|
|
56,977
|
|
27,575
|
|
|
|
13,869
|
|
8,371
|
|
|
|
Diluted earnings per share attributed to shareholders of the
company
|
|
2.30
|
|
1.15
|
|
|
|
0.55
|
|
0.36
|
|
|
|
Diluted earnings per share attributed to shareholders of the
company excluding capital gains and non-recurring items
|
|
1.37
|
|
1.15
|
|
|
|
0.55
|
|
0.36
|
|
|
* Net Income includes, Lucky Buy of $12.6 million offset by inventory
Step-Up of $0.4 million which is included in the GAAP financials among
Cost of Sales.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Cash
Flow Reports
|
|
|
|
|
|
|
|
|
|
For the year ended December 31
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
Thousands of Dollars
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net profit for the period
|
|
|
56,977
|
|
27,575
|
|
Adjustments required to reflect cash flows deriving from operating
activities
|
|
|
31,807
|
|
18,135
|
|
Interest paid in cash
|
|
|
(8,475)
|
|
(5,720)
|
|
Interest received in cash
|
|
|
604
|
|
750
|
|
Taxes on income paid in cash, net
|
|
|
(8,009)
|
|
(4,419)
|
|
Net cash generated from operating activities
|
|
|
72,904
|
|
36,321
|
|
Cash flows from investment activities:
|
|
|
|
|
|
|
Cash added from purchased subsidiary
|
|
|
12,258
|
|
-
|
|
Purchase of subsidiary
|
|
|
(86,052)
|
|
-
|
|
Acquisition of activity
|
|
|
-
|
|
(4,000)
|
|
Acquisition of fixed assets and intangible assets
|
|
|
(21,550)
|
|
(12,490)
|
|
Restricted cash deposit
|
|
|
(2,822)
|
|
-
|
|
Receiving grant for the purchase of fixed assets
|
|
|
-
|
|
178
|
|
Proceeds from sale of assets held for sale
|
|
|
41
|
|
4,489
|
|
Proceeds from selling of fixed asset
|
|
|
765
|
|
218
|
|
Proceeds from a given option exercised as held for sale
|
|
|
-
|
|
-
|
|
Proceeds from sale of real estate in Naharia, net of related expense
|
|
|
2,010
|
|
-
|
|
Loans to subcontractor
|
|
|
(400)
|
|
(888)
|
|
Repayment of long-term receivables balances
|
|
|
-
|
|
-
|
|
Loans granted to employees
|
|
|
(144)
|
|
(37)
|
|
Employees' loans return
|
|
|
155
|
|
31
|
|
Others
|
|
|
(98)
|
|
(208)
|
|
Net cash used for Investing activities
|
|
|
(95,837)
|
|
(12,707)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
Dividends paid holders of minority rights in consolidated
subsidiary
|
|
|
|
|
|
|
|
|
(127)
|
|
(133)
|
|
Debentures repayment
|
|
|
(11,285)
|
|
-
|
|
Dividend paid
|
|
|
(7,995)
|
|
(6,000)
|
|
Repurchase of shares
|
|
|
(1,296)
|
|
-
|
|
Repayment of loans and other long-term liabilities
|
|
|
(2,875)
|
|
(2,229)
|
|
Short-term credit from banking corporations, net
|
|
|
(29,253)
|
|
4,194
|
|
Issuance of debentures
|
|
|
50,987
|
|
-
|
|
Proceeds from exercise of employee options
|
|
|
3,209
|
|
265
|
Net cash generated from financing activities
(used for
financing activities)
|
|
|
1,365
|
|
(3,903)
|
|
Net increase (decrease) in cash and cash
equivalents
|
|
|
(21,568)
|
|
19,711
|
|
Profit (Loss) due to exchange rate differentials on cash and
cash equivalents
|
|
|
1,283
|
|
(166)
|
|
Balance of cash and cash equivalents at the beginning of the
period
|
|
|
65,760
|
|
46,215
|
|
Balance of cash and cash equivalents at the end of the Period
|
|
|
45,475
|
|
65,760
|
|
|
|
|
|
|
|
|
|
|
|
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Cash
Flow Reports
|
|
|
|
|
|
|
|
|
|
For the year ended December 31
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
Thousands of Dollars
|
|
Adjustments required to reflect cash flows from operating
activities:
|
|
|
|
|
|
|
Revenues and expenses not involving cash flow:
|
|
|
|
|
|
|
Depreciation
|
|
|
11,709
|
|
9,660
|
|
Amortization
|
|
|
2,386
|
|
2,182
|
|
Impairment of fixed assets
|
|
|
1,309
|
|
-
|
|
Revaluation of cash, net
|
|
|
(556)
|
|
166
|
|
Interest paid in cash
|
|
|
8,475
|
|
5,720
|
|
Interest received in cash
|
|
|
(604)
|
|
(750)
|
|
Taxes on income paid in cash, net
|
|
|
8,009
|
|
4,419
|
|
Deferred taxes on income, net
|
|
|
1,287
|
|
(392)
|
|
Liabilities from termination of employer – employee relations, net
|
|
|
395
|
|
157
|
|
Restructuring expenses
|
|
|
2,485
|
|
-
|
|
Capital gain from sale of fixed assets
|
|
|
(137)
|
|
(128)
|
|
Capital gain from realization of asset classified as held for sale
|
|
|
(19,910)
|
|
(2,330)
|
|
Change in benefit component of options granted to employees
|
|
|
903
|
|
924
|
|
Change in fair value of financial instruments
|
|
|
77
|
|
1,034
|
|
Long-term pre-paid expenses
|
|
|
220
|
|
-
|
|
Income adjustments due to Purchase Price Allocation
|
|
|
(12,619)
|
|
-
|
|
Others
|
|
|
443
|
|
1,116
|
|
|
|
|
3,872
|
|
21,778
|
|
Changes to operating assets and liabilities:
|
|
|
|
|
|
|
Increase in trade receivables
|
|
|
1,401
|
|
(16,352)
|
|
Decrease (increase) in other receivable and balances
|
|
|
4,037
|
|
(877)
|
|
Increase in trade payables
|
|
|
9,246
|
|
3,354
|
|
Decrease in other payables
|
|
|
(4,051)
|
|
(2,122)
|
|
Decrease (increase) in inventory
|
|
|
17,302
|
|
12,354
|
|
|
|
|
27,935
|
|
(3,643)
|
|
|
|
|
31,807
|
|
18,135
|
About Delta Galil Industries
Delta Galil Industries is a global manufacturer and marketer of branded
and private label apparel products for men, women and children. Since
its inception in 1975, the Company has continually strived to create
products that follow a body-before-fabric philosophy, placing equal
emphasis on comfort, aesthetics and quality. Delta Galil develops
innovative seamless apparel including bras, shapewear and socks;
intimate apparel for women; extensive lines of underwear for men;
babywear, activewear, sleepwear, and leisurewear. For more information,
visit www.deltagalil.com.
Safe Harbor Statement
Matters discussed in this press release contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. When used in this press release, the words
"anticipate," "believe," "estimate," "may," "intend," "expect" and
similar expressions identify such forward-looking statements. Actual
results, performance or achievements could differ materially from those
contemplated, expressed or implied by the forward-looking statements
contained herein, and while expected, there is no guarantee that we will
attain the aforementioned anticipated developmental milestones. These
forward-looking statements are based largely on the expectations of the
Company and are subject to a number of risks and uncertainties. These
include, but are not limited to, risks and uncertainties associated
with: the impact of economic, competitive and other factors affecting
the Company and its operations, markets, product, and distributor
performance, the impact on the national and local economies resulting
from terrorist actions, and U.S. actions subsequently; and other factors
detailed in reports filed by the Company.
Contacts
Delta Galil Industries, Ltd.
For more information:
Nissim
Douek, +972-54-5201178
Nissim@unik.co.il
or
U.S.
Media Contact:
Berns Communications Group
Stacy
Berns/Jessica Liddell, +1-212-994-4660
sberns@bcg-pr.com