In its second-quarter earnings report, Gildan shares the impacts COVID-19 has had on the company.
“Not surprisingly,” the statement reads, “sales in the quarter of $230 million were down 71% compared to last year, and we incurred substantial COVID-related costs and charges.
The company’s CEO Glenn J. Chamandy says, “Against the challenging backdrop of the pandemic and the difficult but necessary actions we have taken, we have accelerated efforts under our Back to Basics strategy to further simplify our product portfolios, remove complexity and cost from our business, better support our customers and drive long term market share growth.”
The Q2 report says Gildan has continued to manage its operations and inventory levels with the demand environment and kept a majority of its production facilities idle or operating at low levels. To lower its costs, it reduced its overall manufacturing workforce by 6,000 employees. It also reduced its selling, general, and administrative staff by roughly 380 employees and announced the closure of a U.S.-based specialty yarn-spinning operation.
In June, to drive market share in the imprintables channel, the company announced and implemented promotional programs to provide discounts to distributors based on their June sell-through of products to screen printers. It then extended these promotions through July and August.
The report states, “While the signs of recovery are encouraging, the trajectory of the pandemic remains uncertain given recent increases in COVID-19 cases in various regions and (a) renewed focus on social distancing measures. Despite this uncertainty, however, we believe we have taken timely and important actions to put in place the necessary financial and operating flexibility to allow us to navigate through this environment and to emerge from the pandemic in a strong overall competitive position.”
For more details, find the full report here.