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Delta Apparel (DLA) Q1 Sales and Earnings Beat, Rise Y/Y
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Shares of Delta Apparel, Inc. (DLA - Free Report) have gained 4.5% in after-hours trading on Feb 8, following the company’s impressive first-quarter fiscal 2022 results. Both the top and the bottom line surpassed the Zacks Consensus Estimate and improved year over year.
Despite the ongoing pandemic-related disruptions, including inflationary pressures and supply-chain challenges, results gained from robust strategic initiatives and broad-based performance in both the Delta and Salt Life business divisions. Also, Delta Apparel is witnessing strength in its DTG2Go business.
Q1 Highlights
Delta Apparel posted earnings of 51 cents per share for first-quarter fiscal 2022. The bottom line beat the Zacks Consensus Estimate of 30 cents and increased from 13 cents earned in the year-earlier quarter. Increased operating profits and a lower tax rate aided the bottom-line performance.
Net sales grew 17% year over year to $110.7 million and came ahead of the Zacks Consensus Estimate of $109 million. The uptick can be attributed to higher sales across both segments. While net sales in the Delta Group segment were up 16% to $101.9 million, the metric at Salt Life segment climbed 24% to $8.8 million.
Gross profit was $23 million, up 13.3% year over year in the reported quarter. However, gross margin contracted 60 basis points (bps) to 20.8%, mainly due to inflationary cost pressures.
Selling, general and administrative expenses (SG&A) jumped 9.4% to $17.5 million due to increased variable selling costs. However, SG&A, as a rate of sales, decreased 110 bps to 15.8% on leveraging fixed costs.
Operating income grew significantly to $5.9 million from $3.1 million recorded in the year-earlier quarter. Operating margin also increased to 5.3% from 3.3% witnessed in the year-ago period.
Financials
At the end of the fiscal first quarter, Delta Apparel had cash of $6.4 million with long-term debt of $118.1 million and total equity of $165 million. Net inventory grew to $183.1 million from $34.6 million recorded in the year-ago period.
Also, Delta Apparel’s cash on hand and availability under the U.S. revolving credit facility were $33 million in December 2021. DLA incurred capital expenditures of $1.8 million during the fiscal first quarter.
Delta Apparel bought back 74,232 shares for $2.1 million during the fiscal first quarter, bringing the overall amount repurchased to $54.6 million. At the end of the reported quarter, DLA had $5.4 million of available buyback capacity under its present authorization.
Looking Ahead
The currently Zacks Rank #2 (Buy) player is poised well, thanks to its robust strategies, Salt Life, Delta Direct, Retail Direct, Global Brands, and DTG2Go business. Besides, its vertical supply-chain network is likely to help it fulfill customers’ demand efficiently.
Over the past three months, shares of Delta Apparel have increased 7.8%, outperforming the industry’s 2.1% growth.
Other Stocks to Consider
Some other top-ranked stocks from the Consumer Discretionary sector are Ralph Lauren (RL - Free Report) , Oxford Industries (OXM - Free Report) and Gildan Activewear (GIL - Free Report) .
The Zacks Consensus Estimate for Ralph Lauren's current financial year’s sales and earnings per share suggests growth of 40% and 374.7%, respectively, from the corresponding year-ago period's reported numbers.
Apparel company Oxford Industries currently has a Zacks Rank #2. OXM has a trailing four-quarter earnings surprise of 96.7%, on average.
The Zacks Consensus Estimate for Oxford Industries’ current financial year’s sales and earnings suggests growth of 2.1% and 4%, respectively, from the corresponding year-ago period's reported numbers.
Gildan Activewear, the manufacturer and marketer of branded basic activewear, presently carries a Zacks Rank of 2. GIL has a trailing four-quarter earnings surprise of 85%, on average.
The Zacks Consensus Estimate for Gildan Activewear’s current financial-year sales and earnings suggests growth of 8.2% and 9.4% each from the respective year-ago period’s reported numbers.
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Delta Apparel (DLA) Q1 Sales and Earnings Beat, Rise Y/Y
Shares of Delta Apparel, Inc. (DLA - Free Report) have gained 4.5% in after-hours trading on Feb 8, following the company’s impressive first-quarter fiscal 2022 results. Both the top and the bottom line surpassed the Zacks Consensus Estimate and improved year over year.
Despite the ongoing pandemic-related disruptions, including inflationary pressures and supply-chain challenges, results gained from robust strategic initiatives and broad-based performance in both the Delta and Salt Life business divisions. Also, Delta Apparel is witnessing strength in its DTG2Go business.
Q1 Highlights
Delta Apparel posted earnings of 51 cents per share for first-quarter fiscal 2022. The bottom line beat the Zacks Consensus Estimate of 30 cents and increased from 13 cents earned in the year-earlier quarter. Increased operating profits and a lower tax rate aided the bottom-line performance.
Delta Apparel, Inc. Price and EPS Surprise
Delta Apparel, Inc. price-eps-surprise | Delta Apparel, Inc. Quote
Net sales grew 17% year over year to $110.7 million and came ahead of the Zacks Consensus Estimate of $109 million. The uptick can be attributed to higher sales across both segments. While net sales in the Delta Group segment were up 16% to $101.9 million, the metric at Salt Life segment climbed 24% to $8.8 million.
Gross profit was $23 million, up 13.3% year over year in the reported quarter. However, gross margin contracted 60 basis points (bps) to 20.8%, mainly due to inflationary cost pressures.
Selling, general and administrative expenses (SG&A) jumped 9.4% to $17.5 million due to increased variable selling costs. However, SG&A, as a rate of sales, decreased 110 bps to 15.8% on leveraging fixed costs.
Operating income grew significantly to $5.9 million from $3.1 million recorded in the year-earlier quarter. Operating margin also increased to 5.3% from 3.3% witnessed in the year-ago period.
Financials
At the end of the fiscal first quarter, Delta Apparel had cash of $6.4 million with long-term debt of $118.1 million and total equity of $165 million. Net inventory grew to $183.1 million from $34.6 million recorded in the year-ago period.
Also, Delta Apparel’s cash on hand and availability under the U.S. revolving credit facility were $33 million in December 2021. DLA incurred capital expenditures of $1.8 million during the fiscal first quarter.
Delta Apparel bought back 74,232 shares for $2.1 million during the fiscal first quarter, bringing the overall amount repurchased to $54.6 million. At the end of the reported quarter, DLA had $5.4 million of available buyback capacity under its present authorization.
Looking Ahead
The currently Zacks Rank #2 (Buy) player is poised well, thanks to its robust strategies, Salt Life, Delta Direct, Retail Direct, Global Brands, and DTG2Go business. Besides, its vertical supply-chain network is likely to help it fulfill customers’ demand efficiently.
Over the past three months, shares of Delta Apparel have increased 7.8%, outperforming the industry’s 2.1% growth.
Other Stocks to Consider
Some other top-ranked stocks from the Consumer Discretionary sector are Ralph Lauren (RL - Free Report) , Oxford Industries (OXM - Free Report) and Gildan Activewear (GIL - Free Report) .
Ralph Lauren currently sports a Zacks Rank #1 (Strong Buy). RL has a trailing four-quarter earnings surprise of 94.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Ralph Lauren's current financial year’s sales and earnings per share suggests growth of 40% and 374.7%, respectively, from the corresponding year-ago period's reported numbers.
Apparel company Oxford Industries currently has a Zacks Rank #2. OXM has a trailing four-quarter earnings surprise of 96.7%, on average.
The Zacks Consensus Estimate for Oxford Industries’ current financial year’s sales and earnings suggests growth of 2.1% and 4%, respectively, from the corresponding year-ago period's reported numbers.
Gildan Activewear, the manufacturer and marketer of branded basic activewear, presently carries a Zacks Rank of 2. GIL has a trailing four-quarter earnings surprise of 85%, on average.
The Zacks Consensus Estimate for Gildan Activewear’s current financial-year sales and earnings suggests growth of 8.2% and 9.4% each from the respective year-ago period’s reported numbers.