Gildan cuts guidance on weaker demand, stock falls 12%

Shares of Gildan Activewear Inc. tanked 12% in the extended session Thursday after the apparel maker cut guidance for the year and called for a 7% drop in quarterly profit. Gildan said it expects to report third-quarter GAAP per-share earnings of about 51 cents a share, and adjusted EPS of about 53 cents a share, both down 7% over the third quarter of 2018. Third-quarter sales are seen around $740 million, 2% lower than the same quarter last year. A previous guidance on Aug. 1. called for adjusted EPS growth to be flat in the third quarter on a projected sales growth. Gildan said it experienced "significantly weaker-than-expected demand for imprintables in North America and ongoing softness in international imprintable markets." Gildan mostly makes plain T-shirts and fleeces that users go on to customize with their own logos and messages. The guidance cut reflects a sales shortfall around $50 million, and presumes that the demand weakness for imprintables both in North America and internationally "will persist through the fourth quarter," the company said. Gildan stock ended the regular trading day up 0.3%. The company is scheduled to report third-quarter results on Oct. 31 before the open. Gildan in Marchwarned of an earnings hit from a debt write-off.

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