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What: Shares of apparel manufacturer Gildan Activewear (NYS: GIL) were jumping for joy today, gaining as much as 11% in intraday trading after the company released fiscal first-quarter results.
So what: For the first quarter, Gildan reported a net loss of $46 million, or $0.38 per share, after notching a profit of $0.29 per share in the same quarter the prior year. Why, then, are investors cheering? The company had actually prepared them for worse, previously projecting a $0.40-per-share loss.
A variety of factors, including higher cotton prices, all came together in one big, nasty storm for the company, plunging its financials into the red. Revenue for the quarter slid 8% YOY to $304 million, which was also slightly more than the company's previous guidance.
Now what: While the first quarter was undoubtedly ugly, investors were likely comforted by the company's confirmation of its fiscal-year outlook. After it delivered a decidedly terrible view late last year, it'd be understandable that investors were concerned that the company might further reduce guidance in its earnings report. As it stands, management sees the company earning $1.30 per share on total sales of $1.9 billion for fiscal 2012. That compares to sales of $1.7 billion and a per-share profit of $1.96 for fiscal 2011.
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