Delta Galil Industries, Ltd. reported sales of 455.8 million dollars for the second quarter, a 68 percent increase from last year, with strong growth across all business segments. The company said, organic sales, excluding Bare Necessities, which was acquired in October of last year, increased by 56 percent in the second quarter.

Commenting on the company’s performance, Isaac Dabah, CEO of Delta Galil, stated in a release: “We are very pleased with our performance this quarter, which now marks four consecutive quarters of record operating margin and three consecutive quarters of record gross margin, including achieving the highest ever gross margin of 41.1 percent in this quarter.”

Highlights of Delta Galil’s sales results

Sales for the first six months of 2021 were 871.9 million dollars, up 44 percent. Excluding the sales of Bare Necessities, which was acquired in October 2020, sales increased by 35 percent.

E-commerce sales on the company’s own website for the second quarter and first six months of 2021 rose 97 percent and 162 percent to 63.3 million dollars and 134.1 million dollars, respectively, compared to comparable periods in 2020. Excluding Bare Necessities, e-commerce own website sales declined 5 percent in the second quarter of 2021 but increased 46 percent in the first half of the year compared to the same period last year.

Delta Galil returns to profitability in Q2

Gross margin increased by 1,180 basis points to 41.1 percent, operating margin increased to 9.3 percent, versus negative 6 percent in Q2 2020.

The company added that net income for the quarter was 27.3 million dollars, compared to a net loss of 53.3 million dollars for the second quarter of 2020, while earnings per share rose to 97 cents compared to a loss per share of 2.08 dollars in the second quarter of 2020.

Net income for the first six months was 42.4 million dollars, compared to a net loss of 83.8 million dollars for the same period last year. Excluding non-core items, net of tax, net income was 42.4 million dollars, compared to a net loss of 43 million dollars for the same period last year. Diluted earnings per share for the period were 1.54 dollars, compared to a diluted loss per share of 3.27 dollars for the same period of 2020. Diluted earnings per share excluding non-core items were 1.54 dollars compared to a loss per share of 1.67 dollars for the comparable period last year.

EBIT for the second quarter increased 97.8 million dollars to 42.4 million dollars, compared to negative 55.4 million dollars in the second quarter of 2020. Before non-core items, EBIT increased 58.7 million dollars to 42.4 million dollars from negative 16.2 million dollars in the second quarter of 2020.

EBIT for the first six months of 2021 increased to 70.4 million dollars, compared to a negative EBIT of 84.1 million dollars for the first six months of 2020. Excluding non-core items, EBIT was 70.4 million dollars, compared to a negative EBIT of 32.1 million dollars for the same period last year.

EBITDA was 66.9 million dollars in the second quarter of 2021, compared to 6.7 million dollars in the second quarter of 2020. For the first six months of 2021, EBITDA was 119.7 million dollars, compared to 14.2 million dollars in the same period last year.

Delta Galil increased its dividend to 5 million dollars or 196 cents per share, to be distributed on August 26, 2021.

Delta Galil raises full year outlook

The company further said that full-year 2021 sales are expected to range between 1,825 million dollars and 1,875 million dollars, representing an increase of 3 percent compared to prior guidance and up 8 percent to 11 percent from 2019 actual sales of 1,690.2 million dollars.

Full-year EBIT is expected to range between 160 million dollars and 170 million dollars, representing an increase of 14 percent compared to prior guidance and up 51 percent 60 percent from 2019 EBIT of 106 million dollars.

EBITDA for the year is expected to range between 260 million dollars and 270 million dollars, representing an increase of 8 percent compared to prior guidance and up 33 percent to 38 percent from 2019 EBITDA of 195.6 million dollars.

Full-year net income is expected to range between 96 million dollars and 104 million dollars, representing an increase of 17 percent compared to prior guidance and up 59 percent to 73 percent from 2019 net income of 60.2 million dollars. Diluted EPS is expected to range between 3.40 dollars and 3.70 dollars, representing an increase of 15 percent compared to prior guidance and up 44 percent to 57 percent from 2019 actual EPS of 2.36 dollars.