Delta Apparel expects 6% decline in Q2 sales due to impact of Covid-19

By

Robin Driver

Published
Apr 20, 2020

Greenville, South Carolina-based Delta Apparel, Inc. released its preliminary second-quarter financial results on Friday, reporting a predicted decrease of 6% in sales as the ongoing coronavirus crisis takes its toll on the company’s operations.

 
The group, which owns the Delta, Salt Life, Soffe and Coast brands, expects that Q2 sales will total $96.7 million, down from $102.8 million in the prior-year period.
 
Before the Covid-19 pandemic began having an impact on Delta Apparel’s operations in March, the company was expecting to achieve quarterly sales growth of 9%.

Despite this initial negative impact, Delta Apparel chairman and CEO Robert Humphreys is confident about the company’s ability to emerge from the disruption caused by the coronavirus.

“About 25% of our business is generated through sales channels that have not been significantly impacted by Covid-19, including our e-Commerce sites, DTG2Go, and our military businesses,” he pointed out in a release. “In fact, in April we are actually seeing meaningful acceleration in our branded direct-to-consumer e-commerce sites and in our DTG2Go on-demand business.”
 
Quarterly earnings are still predicted to rise, increasing around 30%, while earnings per diluted share are expected to be in the range of $0.16 to $0.18, up from $0.13 in the same period in the previous year.
 
According to the company, in reaction to the coronavirus crisis, “it has taken aggressive actions to strengthen its financial position, preserve cash, and improve liquidity beyond its current levels.” No further details were provided about these initiatives, however.

Earlier this month, Delta Apparel announced that it has joined a number of its industry peers in transitioning its manufacturing facilities to the production of cotton face masks. The coalition of companies that Delta has joined expects to produce up to 10 million face masks per week in the United States and in Central America.