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- The company reported Q2 net sales of $862 million, surpassing forecasts, with adjusted earnings per share of 74 cents.
- Gildan Activewear faced $77 million in costs related to a shareholder dispute, including severance and legal fees.
- CEO Glenn Chamandy’s return signals stability, with a three-year outlook projecting mid-teen earnings per share growth.
Apparel maker Gildan Activewear Inc. (NYSE:GIL) incurred approximately $77 million in costs related to a shareholder dispute that led to the reinstatement of Chief Executive Officer Glenn Chamandy after a five-month absence.
The costs included $15.3 million in severance for Vince Tyra, who served as CEO from January to May before being replaced by a pro-Chamandy board. Former senior executive Arun Bajaj, who also departed alongside Tyra, received $9.1 million in severance. Additionally, the company incurred $33.3 million in advisory and legal fees and about $9 million in compensation expenses for Chamandy.
For the second quarter, Gildan reported net sales of $862 million, slightly surpassing analyst forecasts. On an adjusted basis, excluding proxy-fight expenses, the company reported earnings of 74 cents per share, exceeding the 72 cents anticipated by analysts in a Bloomberg survey.
Citigroup analyst Paul Lejuez noted that with the proxy battle resolved and Chamandy back at the helm, the company appears to be on track, suggesting that shares may rise.
Chamandy stated that upon his return, he found the company in strong condition and reaffirmed that all previously identified opportunities remain viable.
Gildan also issued a three-year outlook projecting annual earnings per share growth in the mid-teens, partly supported by plans to borrow funds for share repurchases, aligning with the strategy proposed by dissident shareholders and Chamandy during the proxy contest.
