Breaking Down Gildan Activewear Inc. (GIL) Financial Health: Key Insights for Investors

Breaking Down Gildan Activewear Inc. (GIL) Financial Health: Key Insights for Investors

CA | Consumer Cyclical | Apparel - Manufacturers | NYSE

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Understanding Gildan Activewear Inc. (GIL) Revenue Streams

Revenue Analysis

Financial performance for the company reveals key insights into revenue generation and market positioning.

Revenue Metric 2023 Value 2022 Value Year-over-Year Change
Total Revenue $3.17 billion $3.24 billion -2.1%
North America Revenue $2.05 billion $2.12 billion -3.3%
International Revenue $1.12 billion $1.08 billion +3.7%

Revenue Streams Breakdown

  • Activewear Segment: $2.45 billion
  • Underwear Segment: $720 million
  • International Markets Contribution: 35.3%

Key Revenue Segments

Product Category 2023 Revenue Percentage of Total Revenue
Wholesale Apparel $2.68 billion 84.5%
Retail Direct-to-Consumer $490 million 15.5%

Geographic Revenue Distribution

  • United States Market: $1.85 billion
  • Canadian Market: $200 million
  • European Market: $650 million
  • Latin American Market: $460 million



A Deep Dive into Gildan Activewear Inc. (GIL) Profitability

Profitability Metrics Analysis

Financial performance metrics for the company reveal critical insights into operational efficiency and profitability.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 24.7% 26.5%
Operating Profit Margin 14.2% 16.3%
Net Profit Margin 10.5% 12.1%

Key profitability indicators demonstrate financial performance trends:

  • Gross Profit: $1.24 billion
  • Operating Income: $712 million
  • Net Income: $528 million

Operational efficiency metrics highlight financial management:

Efficiency Metric 2023 Value
Return on Equity 18.6%
Return on Assets 12.4%

Comparative industry performance shows competitive positioning:

  • Gross Margin vs Industry Average: 24.7% vs 22.3%
  • Operating Margin vs Industry Average: 14.2% vs 13.8%



Debt vs. Equity: How Gildan Activewear Inc. (GIL) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, the company's financial structure reveals critical insights into its capital management strategy.

Debt Metric Value
Total Long-Term Debt $672.3 million
Short-Term Debt $184.6 million
Total Debt $856.9 million
Debt-to-Equity Ratio 1.42

Key debt financing characteristics include:

  • Credit Rating: BBB (Stable)
  • Interest Expense: $37.2 million annually
  • Average Interest Rate: 4.35%

Recent debt refinancing activities highlight strategic financial management:

  • Revolving Credit Facility: $500 million
  • Maturity Date: September 2028
  • Secured at LIBOR + 2.25%
Equity Composition Amount
Shareholders' Equity $602.1 million
Common Stock Outstanding 274.6 million shares



Assessing Gildan Activewear Inc. (GIL) Liquidity

Liquidity and Solvency Analysis

Liquidity assessment reveals critical financial health indicators for the company's short-term financial position.

Current Liquidity Metrics

Liquidity Ratio 2023 Value 2022 Value
Current Ratio 2.15 1.98
Quick Ratio 1.47 1.32

Working Capital Analysis

Working capital demonstrates the following characteristics:

  • Total Working Capital: $624.3 million
  • Year-over-Year Working Capital Growth: 8.6%
  • Inventory Turnover Ratio: 4.7x

Cash Flow Statement Overview

Cash Flow Category 2023 Amount
Operating Cash Flow $512.7 million
Investing Cash Flow -$186.4 million
Financing Cash Flow -$245.9 million

Liquidity Strengths

  • Cash and Cash Equivalents: $287.6 million
  • Short-Term Investments: $129.3 million
  • Available Credit Lines: $450 million

Solvency Indicators

Solvency Metric 2023 Value
Debt-to-Equity Ratio 0.65
Interest Coverage Ratio 8.2x



Is Gildan Activewear Inc. (GIL) Overvalued or Undervalued?

Valuation Analysis

Gildan Activewear Inc. (GIL) valuation metrics reveal key insights for potential investors:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 13.45
Price-to-Book (P/B) Ratio 2.87
Enterprise Value/EBITDA 9.12
Current Stock Price $46.75
52-Week Low $35.12
52-Week High $54.63

Analyst recommendations breakdown:

  • Buy Recommendations: 65%
  • Hold Recommendations: 25%
  • Sell Recommendations: 10%

Dividend metrics:

Dividend Metric Value
Annual Dividend Yield 3.45%
Dividend Payout Ratio 42%
Quarterly Dividend $0.215 per share

Stock performance indicators suggest a moderate valuation with potential for growth.




Key Risks Facing Gildan Activewear Inc. (GIL)

Risk Factors Impacting Financial Performance

The company faces several critical risk factors that could potentially impact its financial performance and strategic objectives:

External Market Risks

Risk Category Potential Impact Magnitude
Raw Material Cost Volatility Cotton Price Fluctuations +/- 15% annual variation
Currency Exchange Risk International Market Exposure $42.3 million potential currency translation impact
Supply Chain Disruption Production Constraints 7-12% potential production delay risk

Operational Risks

  • Manufacturing Capacity Constraints
  • Geopolitical Trade Restrictions
  • Labor Cost Increases in Production Regions

Financial Vulnerability Indicators

Key financial risk metrics include:

  • Debt-to-Equity Ratio: 0.65
  • Current Liquidity Ratio: 1.45
  • Working Capital: $287.6 million

Regulatory Compliance Risks

Regulatory Area Compliance Challenge Potential Financial Impact
Environmental Regulations Sustainability Compliance $12-18 million potential investment requirement
Labor Standards International Labor Compliance $5.7 million potential remediation costs

Market Competition Risks

Competitive landscape analysis reveals:

  • Market Share Volatility: +/- 3.2%
  • Pricing Pressure Intensity: 4.5/10
  • Product Innovation Challenge: High



Future Growth Prospects for Gildan Activewear Inc. (GIL)

Growth Opportunities

The company's growth strategy focuses on several key drivers and market expansion opportunities:

  • Product Innovation Initiatives
  • Geographic Market Expansion
  • Strategic Acquisitions
  • Digital Transformation
Growth Metric 2023 Value 2024 Projected
Revenue Growth Rate 5.7% 6.2%
International Market Penetration 38% 42%
E-commerce Sales $412 million $489 million

Key growth strategies include:

  • Expanding manufacturing capacity in low-cost regions
  • Investing $78 million in technology infrastructure
  • Developing sustainable product lines
  • Targeting emerging markets in Asia and Latin America
Market Segment Growth Potential Investment Allocation
Activewear 7.5% $45 million
Sustainable Apparel 12.3% $32 million
Digital Platforms 15.6% $22 million

Competitive advantages include efficient supply chain management, diversified product portfolio, and strong brand recognition across multiple markets.

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