Record First Quarter Sales Increased 11% with Strength Across All Segments and Channels, Representing the 5th Consecutive Quarter of Year-Over-Year Growth

Record First Quarter Gross Profit Expanded 6% to $202.6 Million

First Quarter EBIT Increased 26% to $32.7 Million First Quarter EBIT Before Non-Core Items Increased 11%

First Quarter Net Profit Increased 46% to $17.6 Million First Quarter Net Profit Before Non-Core Items Increased 22%

Strong Balance Sheet with Net Debt to EBITDA, Excluding IFRS 16, of 0.7x

Dividend Declared of $8.0 Million for the First Quarter 2025

CAESAREA, Israel, May 22, 2025--(BUSINESS WIRE)--Delta Galil Industries, Ltd. (DELG/Tel Aviv Stock Exchange), the global designer, manufacturer and marketer of branded and private label intimate, activewear, loungewear and denim apparel for ladies, men, and children, today reported financial results for the first quarter ended March 31, 2025.

First quarter sales increased 11% to a first quarter record of $498.7 million, driven by growth in all segments and channels First quarter online sales of the Company’s own brands increased 21% Gross profit in the first quarter increased 6% to $202.6 million, compared to $190.5 million last year First quarter EBIT before non-core items increased 11% and reached $32.7 million, compared to $29.4 million, for the first quarter last year Net Debt to EBITDA, excluding IFRS 16, was 0.7x for the quarter ended March 31, 2025, compared to 0.7x last year Strong balance sheet with $91.9 million in cash and record shareholders’ equity of $817.7 million at March 31, 2025 Declares a $8.0 million dividend for the first quarter 2025, same as for the first quarter last year

Isaac Dabah, CEO of Delta Galil, stated, "Delta delivered record first quarter sales, reflecting strong momentum across all segments and retail channels. Our top-line performance underscores our efforts to fuel the growth of our brands and partners through exceptional design and a relentless focus on innovation, quality and sustainability. This growth, combined with disciplined cost controls, yielded solid year-over-year gains in EBIT, EBITDA and net income."

Mr. Dabah added, "While the macroeconomic environment has grown more complex amid evolving U.S. trade policies, our growth initiatives remain on track. We continue to see strong demand from key customers and are well positioned to gain market share due to our strategically located manufacturing facilities in countries with low tariff exposure."

"With a profitable model, and a strong balance sheet, we’re well-positioned to invest in our multi-year growth plan. We believe our powerful platform, committed team, and global focus, will allow us to navigate any near-term economic challenges, while pursuing long-term growth opportunities to deliver lasting value for our shareholders," concluded Mr. Dabah.

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Sales

The Company reported first quarter 2025 sales of $498.7 million, an 11% increase from $450.8 million in the first quarter of 2024.

Gross Margin

Gross profit in the first quarter was $202.6 million compared to $190.5 million in the first quarter of 2024.

Gross margin in the first quarter of 2025 was 40.6% compared to 42.3% for the same period last year. The year-over-year reduction in the first quarter gross margin was due primarily to higher freight costs, 90 basis points impact of foreign currency exchange-rates and lower export subsidy in our Egyptian operations.

EBIT

EBIT in the first quarter of 2025 was $32.7 million, compared to $26.0 million, in the first quarter last year.

EBIT before non-core items in the first quarter of 2025 was $32.7 million, or 6.6% of sales, compared to $29.4 million, or 6.5% of sales, in the same period last year.

The year-over-year increase in first quarter EBIT was primarily due to higher sales and controlled operating expenses.

Non-Core Items

For the first quarter of 2025, the Company recorded no non-core expenses. For the first quarter of 2024, expenses associated with the Company’s previously disclosed realignment plan for Bare Necessities were $3.4 million.

Net Income

Net income in the first quarter of 2025 increased 46% to $17.6 million, compared to $12.0 million in the same period last year.

Net income excluding non-core items, net of tax in the first quarter of 2025, increased 22% to $17.6 million, compared to $14.5 million in the first quarter of 2024.

Diluted Earnings Per Share

Diluted earnings per share in the first quarter of 2025 increased 56% to $0.62, compared to $0.39 in the first quarter last year.

Diluted earnings per share, excluding non-core items, net of tax, increased 26% to $0.62 in the first quarter of 2025 compared to $0.49 in the first quarter of 2024.

EBITDA, Cash Flow, Net Debt, Equity, and Dividend

EBITDA, excluding IFRS 16, in the first quarter of 2025 increased 7% to $40.5 million, compared to $37.7 million in the first quarter of 2024.

Cash flow generated from operating activities, excluding IFRS 16, was $4.0 million, compared to $23.5 million in the first quarter of 2024. The year-over-year reduction in operating cash flow was primarily attributable to changes in working capital to support expected sales growth, additional new brands and longer lead-time.

Net Debt to EBITDA, Excluding IFRS 16, as of March 31, 2025, was 0.7x and at a similar level compared to March 31, 2024.

Equity on March 31, 2025, was $817.7 million, up 7% from $764.6 million on March 31, 2024.

Delta Galil declared a dividend of $8.0 million, or $0.3065 per share, which will be distributed on June 10, 2025, with a record and "ex-dividend" date of May 28, 2025.

2025 Financial Guidance

The Company’s previous guidance provided in its 2024 annual report did not include any impacts from new tariff legislation on imports to the U.S. that recently became effective. In light of the uncertainty with respect to country specific reciprocal tariff rates, the Company has withdrawn its prior guidance.

The Company is working to offset the effects of tariffs by sharing the impacts with its long-term vendors and strategically optimizing the Company’s sourcing and production to countries with lower exposure to tariffs. The Company estimates that based on current tariff rates, the potential impact on 2025 annual operating income will not exceed $20 million. In addition, the Company is taking proactive measures to reduce annual operating expenses by $5-7 million.

Constant Currency - Excluding the Impact of Foreign Currency

This release refers to "reported" amounts in accordance with IFRS accounting principles ("GAAP"), which include translation and transactional impacts from foreign currency exchange rates. The release also refers to "constant dollar" amounts, which exclude the impact of translating foreign currencies into U.S. dollars, and are considered a non-GAAP financial measure. These constant currency performance measures should be viewed in addition to, and not in lieu of, or superior to, Delta Galil’s operating performance measures calculated in accordance with GAAP.

About Delta Galil Industries

Delta Galil Industries is a global designer, manufacturer and marketer of branded and private label apparel products for men, women and children. Since its inception in 1975, the Company has continually endeavored to create products that follow a body-before-fabric philosophy, placing equal emphasis on comfort, aesthetics and quality. Delta Galil develops innovative seamless apparel including bras, shapewear and socks; intimate apparel for women; underwear for men including under its owned brands Schiesser, Eminence, Organic Basics, and Athena; babywear, activewear, sleepwear, and loungewear including under its owned P.J. Salvage and Delta brands. Delta Galil also designs, develops markets and sells branded denim and apparel under the brand 7 For All Mankind®, and ladies’ and kids’ apparel under the brand Splendid®. In addition, it sells its products under brand names licensed to the company, including adidas, Wolford, Wilson, Columbia, Tommy Hilfiger, Polo Ralph Lauren and others. For more information, visit www.deltagalil.com.

Safe Harbor Statement

Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," "may" "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein, and while expected, there is no guarantee that we will attain the aforementioned anticipated developmental milestones. These forward-looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, tax rates in the various countries the Company operates in, competitive and other factors affecting the Company and its operations, markets, product, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company.

DELTA GALIL INDUSTRIES LTD. Concise Consolidated Balance Sheets
As of March 31, 2025  March 31  December 31 2025  2024  2024 (Unaudited)  (Audited) Thousands of Dollars  Assets  Current assets:  Cash and cash equivalents 90,188  187,369  120,509 Restricted Cash 1,732  1,859  1,305 Trade receivables 210,538  204,655  271,873 Income taxes receivable 2,805  1,436  1,927 Other accounts receivable 58,809  50,177  56,998 Financial derivative 8  76  160 Inventory 458,085  394,283  400,533 Asset held for sale 1,773  1,773  1,773 Total current assets 823,938  841,628  855,078  Non-current assets:  Investments accounted for using the equity method and long-term receivables 12,825  15,068  12,824 Investment property 2,464  2,585  2,401 Property, plant and equipment, net, including under construction 302,825  253,698  288,346 Goodwill 139,411  144,730  138,033 Intangible assets, net of accumulated amortization 297,458  292,567  294,899 Right of use assets 288,825  237,880  257,629 Deferred tax assets 31,694  30,967  30,537 Financial derivative 170  714  511 Total non-current assets 1,075,672  978,209  1,025,180 Total assets 1,899,610  1,819,837  1,880,258

DELTA GALIL INDUSTRIES LTD. Concise Consolidated Balance Sheets
As of March 31, 2025  March 31  December 31 2025  2024  2024 (Unaudited)  (Audited) Thousands of Dollars  Liabilities and Equity  Current liabilities:  Short-term bank loans 12,014  38,102  2,335 Current maturities of long term bank loans 21,567  24,965  20,939 Current maturities of bonds 29,471  29,662  29,476 Financial derivative 1,222  1,143  1,314 Current maturities of leases liabilities 79,323  51,908  53,663 Trade payables 235,619  203,982  237,371 Income taxes payable 18,661  29,729  23,805 Provision for realignment plan 7,303  3,563  8,142 Others payables 173,623  142,261  194,900 Total current liabilities 578,803  525,315  571,945  Non-current liabilities:  Bank loans 118,310  133,471  124,163 Post-employment benefits obligation, net 5,418  5,434  5,810 Lease Liability 230,972  206,311  225,802 Other non-current liabilities 48,103  53,441  49,105 Bonds 63,291  94,996  64,712 Deferred taxes liabilities 34,079  33,521  33,394 Financial derivative 2,957  2,746  1,765 Total non-current liabilities 503,130  529,920  504,751 Total liabilities 1,081,933  1,055,235  1,076,696  Equity:  Equity attributable to shareholders in the parent company:  Share capital 23,714  23,714  23,714 Share premium 123,800  126,219  124,025 Other capital reserves 23,651  23,168  15,590 Retained earning 632,409  573,560  625,912 Treasury shares (9,464)  (12,026)  (9,832) 794,110  734,635  779,409 Non-controlling interests 23,567  29,967  24,153 Total equity 817,677  764,602  803,562 Total liabilities and equity 1,899,610  1,819,837  1,880,258

DELTA GALIL INDUSTRIES LTD. Concise Consolidated Statement of Income
For the 3-month period ending March 31, 2025  Three months ended March 31  % Increase/(Decrease) 2025  2024  (Unaudited)  Thousands of Dollars  Except for Earning Per Share data   Sales 498,670  450,779  11% Cost of sales 296,082  260,280  Gross profit 202,588  190,499  6% % of sales 40.6%  42.3%  Selling and marketing expenses 142,346  134,811  6% % of sales 28.5%  29.9%  General and administrative expenses 28,048  26,407  6% % of sales 5.6%  5.9%  Other income, net and Share in profits of investees accounted for using the equity method (486)  (69)  Operating income excluding non-core items 32,680  29,350  11% % of sales 6.6%  6.5%  Non-core items -  3,360  Operating income 32,680  25,990  26% Financing expenses, net 9,597  10,938  (12%) Income before tax on income 23,083  15,052  Income taxes expenses 5,480  3,003  Net income for the period 17,603  12,049  46% Net income for the period excluding non-core items, net of tax 17,603  14,486  22%  Attribution of net earnings for the period:  Attributed to Company's shareholders 16,219  10,339  Attributed to non-controlling interests 1,384  1,710  17,603  12,049   Net diluted earnings per share attributed to company's shareholders 0.62  0.39  Net diluted earnings per share, before non-core items, net of tax, attributable to Company's shareholders 0.62  0.49  27%

DELTA GALIL INDUSTRIES LTD. Concise Consolidated Cash Flow Reports
For the 3-month period ending March 31, 2025  Three months ended March 31 2025  2024 (Unaudited) Thousands of Dollars  Cash flows from operating activities:  Net income for the period 17,603  12,049 Adjustments required to present cash flows from operating activities 19,748  43,337 Interest paid in cash (8,961)  (8,522) Interest received in cash 439  1,234 Income taxes paid in cash, net (10,393)  (12,524) Net cash generated from operating activities 18,436  35,574  Cash flows from investment activities:  Acquisition of property, plant including under construction (20,635)  (12,295) Acquisition of intangible assets (5,320)  (17,364) Proceeds from sale of property, plant and equipment 1,724  220 Others (407)  416 Net cash used in Investing activities (24,638)  (29,023)  Cash flows from financing activities:  Dividend paid to non-controlling interests in subsidiary (1,679)  (1,800) Payment of long-term payable in connection with acquisition of property, plant and equipment under construction (1,203)  (1,406) Principal elements of lease payments (14,386)  (12,087) Dividend paid (10,023)  (9,021) Receipt of long-term bank loans 967  543 Repayment of long-term bank loans (7,434)  (6,154) Short-term credit from banking corporations, net 9,463  37,282 Others (232)  1,734 Net cash generated from (used in) financing activities (24,527)  9,091 Net increase (decrease) in cash and cash equivalents (30,729)  15,642  Effects of exchange rate changes on cash and cash equivalents 408  (2,736)  Balance of cash and cash equivalents at the beginning of the period, net 120,509  174,463 Balance of cash and cash equivalents at the end of the Period, net 90,188  187,369

DELTA GALIL INDUSTRIES LTD. Concise Consolidated Cash Flow Reports
For the 3-month period ending March 31, 2025  Three months ended March 31 2025  2024 (Unaudited) Thousands of Dollars  Reconciliations required to present cash flows generated by operating activities:  Adjustments in respect of:  Depreciation 8,263  8,331 Amortization 16,812  17,610 Exchange rate (gains) losses (163)  410 Interest in respect of bonds and loans 5,623  5,798 Interest received in cash (439)  (1,234) Taxes on income paid in cash, net 10,393  12,524 Deferred taxes on income, net (1,701)  (4,545) Interest expenses recognized in respect of lease agreements 3,338  2,724 Retirement benefit obligation, net (514)  187 Change in realignment provision (839)  (11) Gain from disposal of property, plant and equipment (477)  (76) Share-based payments expenses 414  401 Share in profits (loss) of investee accounted for using the equity method 147  (60) Others 271  (1,241) 41,128  40,818 Changes to operating assets and liabilities:  Decrease in trade receivables 63,763  33,480 Increase in other receivable (1,888)  (1,777) Increase (decrease) in trade payables (6,604)  35,460 Decrease in other payables (23,823)  (28,330) Increase in inventory (52,828)  (36,314) (21,380)  2,519 19,748  43,337

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Contacts

For more information:
Nissim Douek
+972-54-5201178
[email protected] 
U.S. Media Contact:
Stacy Berns
Berns Communications Group
+1-212-994-4660
[email protected]

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