Delta Galil Announces Preliminary 2022 Guidance and Reaffirms 2021 Guidance

Delta Galil Industries, Ltd. (TLV: DELT) (“Delta Galil”, “we”, “us”, or the “Company”), the global designer and manufacturer of branded and private label intimates, activewear, loungewear and jeanswear apparel for men, women and children, is pleased to issue preliminary guidance for full-year 2022, taking into account positive developments in business conditions, demand indications from major customers, and the commencement of activity under new licensing agreements with iconic global brands such as adidas and Wolford. The Company also reaffirms its 2021 guidance, published November 3, 2021 as part of the Company’s financial reports for September 30, 2021. Such guidance is based on current market conditions, assumes no further material lockdowns or shutdowns due to the COVID-19 pandemic in any major operating regions in which we sell or manufacture products, and excludes the impact of non-core items:

(in USD millions, except earnings per share amounts)

 

2022 Guidance

 

2021 Guidance

 

% Increase

Sales

 

$2,082 – $2,135

 

$1,900 – $1,940

 

10%

Operating income

 

$204 – $220

 

$180 – $186

 

16%

Adjusted EBITDA

 

$306 – $322

 

$280 – $286

 

11%

Net income

 

$133 – $145

 

$113 – $117

 

21%

Diluted earnings per share

 

$4.63 – $5.09

 

$4.00 – $4.15

 

19%

Operating income excluding IFRS 16 impact

 

$192 – $208

 

$168 – $174

 

17%

Adjusted EBITDA excluding IFRS 16 impact

 

$242 – $258

 

$216 – $222

 

14%

Net income excluding IFRS 16 impact

 

$131 – $143

 

$111 – $115

 

21%

About Delta Galil

Delta Galil is a global manufacturer and marketer of branded and private label apparel products for men, women and children. Since its inception in 1975, the Company has continually strived 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; extensive lines of underwear for men and branded Men’s underwear including the brands Schiesser, Eminence, Athena & Liabel; babywear, activewear, sleepwear such as the PJ Salvage brand, and leisurewear. Delta Galil also designs, develops markets and sells branded denim and apparel under the brand 7 For All Mankind®, and ladies apparel under the brands Splendid® and Ella Moss®, among others. In addition, it sells its products under brand names licensed to the company, including Wilson, Spalding, Tommy Hilfiger and others. For more information, visit www.deltagalil.com.

Forward-Looking Statements

We make forward-looking statements in this press release within the meaning of the Securities Law 5728-1968 that are subject to risks and uncertainties. These statements discuss future expectations, contain projections of results of operations or of financial condition or state other “forward-looking” information. Forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “continue,” “intend,” “should,” “plan,” “predict,” “potential,” “would,” “could,” or the negative of these terms or other similar expressions or other similar words. We have based these forward-looking statements on our current expectations and projections about the industry and future events, many of which, by their nature, are inherently uncertain and beyond our control. These forward-looking statements are subject to risks, uncertainties and assumptions. These include, but are not limited to, risks and uncertainties associated with: the global COVID-19 pandemic and the measures that may be taken by authorities in the countries where the Company operates, a change in the behavior of customers and consumers, or other changes the impact of economic, 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. Moreover, we operate in a very competitive environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this prospectus may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. As a result, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and we do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

Use of Non-IFRS Financial Measures

To supplement our unaudited consolidated financial statements presented on a basis consistent with IFRS, we disclose certain non-IFRS financial measures, including Adjusted EBITDA, Adjusted EBITDA excluding IFRS 16 impact, operating income excluding IFRS 16 impact and net income excluding IFRS 16 impact. Adjusted EBITDA is defined as our net income plus income taxes, finance expenses, net, and depreciation and amortization, and adjusted for items that we believe are not representative of our core business or future operating performance (“Non-core Items”), including acquisition costs, inventory step up and impairment of intangible assets. Our definitions and calculations of these items may not necessarily be the same as those used by other companies. Adjusted EBITDA, Adjusted EBITDA excluding IFRS 16 impact, operating income excluding IFRS 16 impact and net income excluding IFRS 16 impact are not measures of liquidity or profitability and should not be considered isolated from, or as an alternative to, net income, operating income, net cash provided by operating activities or any other measure determined in accordance with IFRS. We believe that these non-IFRS measures have certain limitations in that they do not reflect all of the amounts associated with our IFRS results of operations. These non-IFRS measures should only be viewed in conjunction with corresponding IFRS measures. We compensate for the limitations of non-IFRS financial measures by relying upon IFRS results to gain a complete picture of our performance. Non-IFRS financial measures are not in accordance with and do not serve as an alternative for the presentation of our IFRS financial results. We are providing this information to enable investors to perform more meaningful comparisons of our operating results in a manner similar to management’s analysis of our business. We have not provided a reconciliation of forward-looking non-IFRS measures because, without unreasonable efforts, we are unable to predict with reasonable certainty the amount and timing of adjustments that are used to calculate these non-IFRS measures.