Montreal-based apparel manufacturer Gildan Activewear has reported gross profit of $188 million in the first quarter of fiscal 2023, down $53 million from the prior year. The company’s adjusted gross profit was $184 million, down $55 million from the prior year. The company's net sales for the quarter were $703 million, down $72 million or 9 percent compared to the prior year's sales.

In the first quarter, sales in the activewear category were $588 million, down $80 million or 12 percent from the same period last year. International sales were down 17 percent versus the prior year, while the hosiery and underwear category showed strength with sales of $115 million, up $8 million or 7 percent, mainly driven by sock volume growth.

Gross margin and adjusted gross margin were down year-over-year by 430 basis points and 470 basis points, respectively, due to peak fibre costs, higher manufacturing input costs, and unfavourable mix. These factors were partly offset by higher net selling prices, the company said in its financial results for the first quarter ending April 2.

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Selling, general, and administrative expenses for the first quarter were largely in line with prior year levels, but as a percentage of net sales, they were 11.6 per cent compared to 10.5 per cent last year, primarily due to sales deleverage.

The company generated operating income of $128 million in the first quarter, or 18.2 percent of sales, compared to operating income of $162 million, or 20.9 percent of sales in the first quarter last year.

"We are pleased with our top line results having met our sales expectations for the quarter” said Glenn Chamandy, Gildan’s president and CEO.

“Moreover, even though the economic environment remains uncertain, we remain comfortable with our full year outlook given our strong competitive position, which we are reinforcing with the Gildan Sustainable Growth (GSG) strategy, and point of sale (POS) trends across our business coming in line with our expectations during the first quarter."