DULUTH, Ga. - Delta Apparel (NYSE:DLA), Inc. (NYSE American: DLA), an international apparel company, revealed a decline in net sales and an increase in net loss for its fiscal year 2024 first quarter ended December 30, 2023. The company's net sales fell to $79.9 million from $107.3 million in the prior year period, while net loss widened to $8.5 million, or $1.22 per share, from a loss of $3.6 million, or $0.51 per share.
The company's Salt Life Group segment saw a slight increase in net sales to $10.3 million, but Delta Group segment sales dropped to $69.6 million from $97.0 million year-over-year. Gross margins contracted to 10.9% from 12.7% due to production curtailments. Adjusted for these curtailments, gross margins would be 12.6%.
Delta Apparel's Chairman and CEO, Robert W. Humphreys, stated that the company continues to experience unfavorable market dynamics similar to the previous year, prompting further actions to improve the balance sheet and streamline costs. Debt and inventory levels were reduced by more than 20% year-over-year, and the company is near completing its offshore manufacturing footprint reduction.
Despite the overall sluggishness in the Activewear segment, the company's digital print business, DTG2Go, saw improved on-quality performance and shipments above internal plans, although demand during the holiday season was below forecasts. The Salt Life business saw growth in direct-to-consumer channels and success in its new retail location in Virginia.
The company remains focused on managing liquidity and working capital and is committed to evaluating strategic options and monetizing its real estate through sale-leaseback transactions when the value proposition is favorable.
Delta Apparel ended the quarter with net inventory of $196.3 million, a decrease from the previous year, and debt under its U.S. revolving credit facility was reduced to $110.8 million. However, cash on hand and availability under the credit facility decreased, and the company is exploring options for additional liquidity.
The company will hold a conference call to discuss its financial results today at 4:30 p.m. ET.
This news is based on a press release statement from Delta Apparel, Inc.
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