Delta Apparel, Inc. (NYSE Amex: DLA) today reported financial results for the fiscal 2012 first quarter ended October 1, 2011.
First Quarter Highlights
- Net sales increased 14.5% to a record $123.5 million.
- Gross margins improved 130 basis points to 25.3%.
- Operating profit improved to 5.4% of sales from 2.7% of sales in the prior year period.
- Net income increased 167.7% to $4.4 million from $1.6 million in the prior year period.
- Diluted EPS increased 163.2% to $0.50 from $0.19 in the prior year period.
Sales for the three months ended October 1, 2011 increased $15.6 million to a record $123.5 million. Each business unit contributed to the 14.5% organic sales growth in the quarter. Gross margins improved to 25.3% compared to 24.0% in the prior year first quarter, with margin expansion in both the branded and basics segments. Selling, general and administrative expenses were 19.9% of sales, an improvement of 130 basis points compared to 21.2% of sales in the prior year first quarter. The prior year included costs associated with the acquisition of The Cotton Exchange, expenses related to the start-up of Art Gun, and brand-marketing campaigns that were not repeated during the current year quarter. Interest expense increased $0.3 million during the quarter compared to the prior year driven primarily from the higher working capital resulting from the significant rise in cotton costs. The Company's effective tax rate is 24% for the current year quarter, down from the prior year quarter of 30%, but consistent with the 23.6% effective tax rate for the 2011 fiscal year. Net income for the quarter ended October 1, 2011 was $4.4 million, or $0.50 per diluted share, compared to $1.6 million, or $0.19 per diluted share, in the prior year first quarter.
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