Gildan Activewear cuts executive compensation 50 per cent following Q1 loss
By The Canadian Press
Gildan Activewear Inc. says it is suspending its quarterly dividend and cutting executive compensation after losing nearly US$100 million in its first quarter due to the global impact of the COVID-19 pandemic.
The Montreal-based company says it is also suspending share repurchases and deferring non-critical capital spending and expenses.
The company’s board, chief executive and executive vice-presidents are foregoing half their salaries, senior staff face pay reductions of 20 to 35 per cent and most salaried employees are working four days a week.
Gildan says it lost US$99.3 million or 50 cents per diluted share for the period ended March 29. That compared with a US$22.7 million or 11-cent profit a year earlier.
Excluding one-time items including a US$100 million after-tax charge mainly from impairment for goodwill and intangible assets, Gildan earned an adjusted profit of US$11.2 million or six cents per share. That’s down from US$32.8 million or 16 cents per share in first quarter of 2019.
Revenues dropped 26.4 per cent to US$459.1 million from US$623.9 million in the prior year.
“Despite on-track performance during the first two months of the quarter, as global efforts to slow the transmission of COVID-19 heightened in March we started to see a significant downturn in demand for our core products, particularly in the imprintables channel where our products are typically used for promotional, sporting, entertainment, and other large-gathering and cultural events,” stated CEO Glenn Chamandy.
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