Q2 2025 Gildan Activewear Inc Earnings Call

July 31, 2025

Get off of working with me down at our spot.

We had a panel with a view of parking lot.

For 1.

Like I was on you.

Speaker 4: Next thing I know, you were in my T-shirt right there, your hair messed up like a Guns N' Roses video. Oh, oh so hot. Still got it up in my head. You were moving around in the PD light. I ain't ever seen anything like your dress and my floor, the way you wore my T-shirt. Yeah. You look good in my T-shirt, girl. Oh yeah. If you walk in those stairs with the neighbors saying, "Keep it down," but it's hard to unlock the door when you're making out. You know what I'm saying? You be saying, "Then we gotta quit doing this." So why are you leaning in for one more kiss? And pretty soon you're sliding off what you got on and slipping into my T-shirt right there.

[Analyst]: I ain't ever seen anything like your dress on my floor. The way you wore my T-shirt. Yeah. You look good in my T-shirt, girl. Oh, yeah. We'd be walking up the stairs with the neighbors saying, "Keep it down." It's hard to unlock the door when you're making out. You know what I'm saying? You'd be saying that we gotta quit doing this. Why you leaning in for one more kiss? Pretty soon, you're sliding off what you got on and slipping into my T-shirt, right there.

Wrapping your hair, messed up? Like a Guns and Roses video. Oh, oh. So high still got it up. In my head, you're moving around in the TV. Light.

and it feel like,

Your dress.

To my floor. No way you are my my t-shirt,

Yeah.

Oh yeah.

Me walking up the stairs with the neighbors saying keep it down.

But it's hard to unlock the door when you make it out.

You saying.

You'll be saying that we got to quit doing this. So why you leaning in for 1 more kiss? And pretty soon. You're sliding off what you got on. It's just burning in my t-shirt right there.

Operator: Ladies and gentlemen, thank you for standing by, and welcome to Gildan Activewear's 2025 Q2 Earnings Conference Call. Please be advised that today's conference is being recorded. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star on your touchtone phone, and to withdraw your question, please press star one again. I would now like to hand the conference over to Jessy Hayem, Senior Vice President, Head of Investor Relations and Global Communications. Ma'am, please go ahead.

Operator: Ladies and gentlemen, thank you for standing by and welcome to Gildan Activewear's 2025 Second Quarter Earnings Conference call. Please be advised that today's conference is being recorded. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star on your touchtone phone, and to withdraw your question, please press star one again. I would now like to hand the conference over to Jessy Hayem, Senior Vice President, Head of Investor Relations and Global Communication. Ma'am, please go ahead.

Ladies and gentlemen, thank you for standing by and welcome to Gildan active wears, 2025 second quarter earnings conference. Call please be advised. That today's conference is being recorded after today's presentation, there will be an opportunity to ask questions.

To ask a question, you may press star on your touchtone phone and to redraw your question. Please press star 1 again.

I would now like to hand the conference over to Jesse hams

senior vice president head of investor relations and Global Communications. Matt, please go ahead.

Jessy Hayem: Thank you, Janine. Good morning, everyone, and thank you for joining us. Earlier today, we issued a press release announcing our results for Q2 while updating our full-year guidance for 2025. We also issued our interim shareholder report containing MD&A and consolidated financial statements. These documents are expected to be filed with the Canadian Securities and Regulatory Authorities and the U.S. Securities Commission today, and they'll also be available on our corporate website. Joining me today on the call are Glenn Chamandy, President and CEO of Gildan, Luca Barile, Executive Vice President, Chief Financial Officer, and Chuck Ward, Executive Vice President, Chief Operating Officer. This morning, as usual, we'll take you through the results for the quarter, and then a question and answer session will follow.

Jessy Hayem: Thank you, Junine. Good morning, everyone, and thank you for joining us. Earlier today, we issued a press release announcing our results for the second quarter while updating our full-year guidance for 2025. We also issued our interim shareholder report containing management's discussion and analysis and consolidated financial statements. These documents are expected to be filed with the Canadian Securities and Regulatory Authorities and the US Securities Commission today, and they'll also be available on our corporate website. Joining me today on the call are Glenn Chamandy, President and CEO of Gildan, Luca Barile, Executive Vice President, Chief Financial Officer, and Chuck Ward, Executive Vice President, Chief Operating Officer. This morning, as usual, we'll take you through the results for the quarter, and then a question and answer session will follow.

Thank you, Janine. Good morning, everyone, and thank you for joining us earlier. Today, we issued a press release announcing our results for the second quarter, while updating our full-year guidance for 2025.

We also issued our interim shareholder report, containing Management's, discussion, and Analysis, and Consolidated financial statements. These documents are expected to be filed with the Canadian Securities and Regulatory authorities and the US Securities Commission today and they'll also be available on our corporate website.

Joining me today on the call are Glenn, Mandy president and CEO of Gildan, Luca burle, Executive Vice President, Chief Financial Officer and Chuck Ward Executive, Vice President, Chief Operating Officer.

Jessy Hayem: Before we begin, please take note that certain statements included in this conference call may constitute forward-looking statements, which involve unknown and known risks, uncertainties, and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. We refer you to the company's filings with the US Securities and Exchange Commission and Canadian Securities Regulatory Authorities. During the call, we will also discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable IFRS measures are provided in today's earnings release, as well as our MDNA. And now, I'll turn it over to Glenn.

Jessy Hayem: Before we begin, please take note that certain statements included in this conference call may constitute forward-looking statements which involve unknown and known risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. We refer you to the company's filings with the U.S. Securities and Exchange Commission and Canadian Securities regulatory authorities. During the call, we will also discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable IFRS measures are provided in today's earnings release as well as our MD&A. Now I'll turn it over to Glenn.

This morning, as usual, we will take you through the results for the quarter, and then a question-and-answer session will follow.

Before we begin, please take note that certain statements included in this conference call May constitute forward-looking statements which involve unknown and known risks, uncertainties and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements.

We refer you to the company's filings with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities.

Glenn Chamandy: Thank you, Jessy, good morning, everyone. Our Gildan Sustainable Growth Strategy is on track. We're executing the plan that we have laid out, especially in this fluid environment. Our priority is to control the controllables with discipline and agility. We reported record Q2 sales of $919 million, which were up 6.5% versus last year, driven by strong activewear sales growth of 12%. We also reported record adjusted diluted EPS of $0.97 a share, an increase of 31% year over year, reflecting our focus on profitable growth, and we are very pleased to deliver this strong performance. We continue to demonstrate consistent execution of our Gildan Sustainable Growth Strategy. From our Bangladesh facility being ramped up to the continued pipeline of new innovation, and finally ESG with the publication of our 21st ESG report in May. We continue to gain market share in key growth categories.

Glenn Chamandy: Thank you, Jessy, and good morning, everyone. Our Gildan Sustainable Growth Strategy is on track. We're executing the plan that we have laid out, especially in this fluid environment. Our priority is to control the controllables with discipline and agility. We reported record second-quarter sales of $919 million, which were up 6.5% versus last year, driven by strong ActiveWare sales growth of 12%. We also reported record-adjusted diluted EPS of 97 cents a share, which increased at an increase of 31% year over year, reflecting our focus on profitable growth, and we are very pleased to deliver this strong performance. We continue to demonstrate consistent execution of our Gildan Sustainable Growth Strategy, from our Bangladesh facility being ramped up to the continued pipeline of new innovation, and finally, ESG with the publication of our 21st ESG report in May. We continue to gain market share in key growth categories.

During the call, we will also discuss certain non-gaap Financial measures reconciliations to the most directly comparable IFRS measures are provided in today's earnings release as well as our mdna. And now I'll turn it over to Glenn.

Thank you, Jesse and good morning, everyone.

Our Guild and sustainable growth strategy is on track. We're executing the plan that we have laid out as this fluid environment.

Our priority is to control the controllables with discipline and Agility.

We reported record second quarter sales of 9919 million, which were up 6.5% versus last year driven by strong, active or sales growth of 12%.

We also reported record, adjusted diluted EPS of 97 cents a share, which increased and an increase of 31% year-over-year reflecting our focus on profitable growth. And we are very pleased to deliver the strong performance.

We continue to demonstrate consistent execution of our Gildan, sustainable growth strategy.

From our Bangladesh, facility being ramped up to the continued pipeline of new innovation. And finally ESG, with the publication of our 21st, ESG report in May,

Glenn Chamandy: Our sales and distributor channel were further supported by strong demand of our existing brands like Gildan Soft Cotton Technology, Comfort Colors, American Apparel, and from the contribution of new brand offerings under the All Pro brand and Champion. Furthermore, we see solid momentum in our national accounts. Remember, about three quarters of our expected sales growth in 2025 is expected to come from new programs. We're set to continue to launch additional industry-leading innovation, and we'll continue to focus on operating our global vertically integrated low-cost manufacturing facilities, which will allow us to be flexible, agile in this operating environment with the current tariffs in place. Remember, that's significant that we have significant US cotton and yarn content in our products, and this allows for significant tariff savings since tariffs do not apply to the value of US content on imported products, a clear competitive advantage for us.

Glenn Chamandy: Our sales and distributor channel were further supported by strong demand of our existing brands like Gildan Soft Cotton technology, Comfort Colors, American Apparel, and from the contribution of new brand offerings under the All Pro brand and Champion. Furthermore, we see solid momentum in our national accounts. Remember, about three-quarters of our expected sales growth in 2025 is expected to come from new programs. We're set to continue to launch additional industry-leading innovation and will continue to focus on operating our global, vertically integrated, low-cost manufacturing facilities, which will allow us to be flexible, agile in this operating environment with the current tariffs in place. Remember that we have significant US cotton and yarn content in our products, and this allows for significant tariff savings since tariffs do not apply to the value of US content on imported products. A clear competitive advantage for us.

We continue to gain market share in key growth categories. Our sales and distributor channel were further supported by strong demand for our existing brands, like Gildan Soft Cotton technology, Comfort Colors, and American Apparel.

And from the contribution of new brand offerings under the allpro brand and champion.

Furthermore, we see consult solid momentum in our national accounts. Remember about 3/4 of our expected sales growth in 2025, is expected to come from new programs.

Low-cost manufacturing facilities which will allow us to be flexible agile in this operating environment with the current tariffs in place.

Remember.

Glenn Chamandy: And to mitigate the impact we do have from tariffs, we have implemented pricing action. So with that in mind, we are reaffirming our previous provided 2025 full-year guidance, and we are narrowing our adjusted diluted EPS range, all of which are supported by many drivers that should allow us to deliver on our objectives for the full year. So in conclusion, despite the prevailing uncertainty, I am confident in our ability to continue delivering as we remain on track to deliver on our three-year objectives for the 2025 to 2027 period, thanks to our solid foundation, our focus on GSG strategy, our strong industry positioning, and our experience in operating in dynamic environments, all with the focus of executing to deliver long-term shareholder value. I'm looking forward to answering your questions after our formal remarks, and now I will turn it over to Luca for the financial review.

Glenn Chamandy: To mitigate the impact we do have from tariffs, we have implemented pricing action. With that in mind, we are reaffirming our previous provided 2025 full year guidance, and we are narrowing our adjusted diluted EPS range. All of which are supported by many drivers that should allow us to deliver on our objectives for the full year. In conclusion, despite the prevailing uncertainty, I am confident in our ability to continue delivering as we remain on track to deliver on our 3-year objectives for the 2025 to 2027 period. Thanks to our solid foundation, our focus on GSG strategy, our strong industry positioning, and our experience in operating in dynamic environments, all with the focus of executing to deliver long-term shareholder value. I'm looking forward to answering your questions after our formal remarks, and now I will turn it over to Luca for the financial review.

That significant that we have significant us cotton and yarn content in our products and this allows for significant tariff savings. Since tariffs do not apply to the value of US content on imported products, a clear competitive Advantage for us.

And to mitigate the impact, we do have from tariffs, we have implemented pricing action.

so with that, in mind,

We are reaffirming reffering our previous provided 2025 full year guidance. And we are narrowing. Our adjusted diluted EPS range.

All of which are supported by many drivers that should allow us to deliver on our objectives for the full year.

so, in conclusion,

despite the prevailing uncertainty, I am confident in our ability to continue, delivering

As we remain on track to deliver on our 3-year objectives for the 2025 to 2027 period.

Thanks to our solid foundation. Our focus on GSG strategy, our strong industry positioning,

And our experience in operating and dynamic environments.

All with the focus of executing to deliver long-term shareholder value.

Luca Barile: Thank you, Glenn. Good morning, everyone, and thank you for joining us today to discuss our Q2 results. Let me begin by covering the specifics of the Q2, and then I will comment on our outlook and guidance for 2025. Let's begin with the Q2's results. We reported record Q2 sales of $919 million, up 6.5% year over year, in line with guidance provided. This reflected strong performance in activewear, with sales up 12%, driven by higher sales volumes and to a lesser extent, favorable product mix and higher net prices. We continued to experience a strong market response to our recently introduced products, which feature key innovations including our Gildan Soft Cotton technology. Strong sales to North American distributors were complemented by continued momentum with national account customers, driven by our competitive positioning and the ongoing benefits from recent changes in the industry landscape.

Luca Barile: Thank you, Glenn. Good morning, everyone, and thank you for joining us today to discuss our second quarter results. Let me begin by covering the specifics of the quarter, and then I will comment on our outlook and guidance for 2025. So let's begin with the quarter's results. We reported record second-quarter sales of $919 million, up 6.5% year over year, in line with guidance provided. This reflected strong performance in ActiveWare, with sales up 12%, driven by higher sales volumes and, to a lesser extent, favorable product mix and higher net prices. We continued to experience a strong market response to our recently introduced products, which feature key innovations, including our soft cotton technology. Strong sales to North American distributors were complemented by continued momentum with national account customers, driven by our competitive positioning and the ongoing benefits from recent changes in the industry landscape.

I'm looking forward to answering your questions after our formal remarks and now I will turn it over to Luca for the financial review.

Thank you, Glenn.

Good morning everyone and thank you for joining us today to discuss our second quarter results.

Let me Begin by covering the specifics of the quarter and then I will comment on our Outlook and guidance for 2025.

So, let's begin with the quarter's results.

We reported record second quarter sales of 919 million up 6.5% year-over-year in line with guidance provided

this reflected strong performance in active wear with sales up, 12% driven by higher sales volumes and to a lesser extent, favorable product mix and higher, net prices.

We continue to experience a strong Market responds to our recently introduced products, which feature key Innovations, including our soft cotton technology.

Strong sales to North American Distributors were complemented by continued momentum with national account, customers driven by our competitive positioning, and the ongoing benefits from recent changes in the industry landscape.

Luca Barile: During the quarter, we benefited from a slight tailwind from orders being placed in advance of our announced pricing actions. Turning to international markets, sales were down by 14% year over year as demand moderated in Europe and softness persisted in Asia due to the macroeconomic backdrop. Furthermore, and contributing to a softer quarter for international, we faced a tough comparative period in Latin America, as last year's quarter included large election-related purchases. Moving on to hosiery and underwear. As we expected, sales in this category were down in the quarter. We reported a 23% decrease versus the prior year, stemming from broad-based market demand softness, unfavorable mix, and, as previously communicated, some program resets towards the second half of the year.

Luca Barile: During the quarter, we benefited from a slight tailwind from orders being placed in advance of our announced pricing actions. Turning to international markets, sales were down by 14% year over year as demand moderated in Europe and softness persisted in Asia due to the macroeconomic backdrop. Furthermore, contributing to a softer quarter for international, we faced a tough comparative period in Latin America, as last year's quarter included large election-related purchases. Moving on to hosiery and underwear. As we expected, sales in this category were down in the quarter. We reported a 23% decrease versus the prior year, stemming from broad-based market demand softness, unfavorable mix, and as previously communicated, some program resets towards the H2 of the year. Turning our focus to margins for the quarter.

During the quarter, we benefited from a slight Tailwind from orders, being placed in advance of our announced pricing actions.

Turning to International markets.

Sales were down by 14% year-over-year as demand moderated in Europe and softness. Persisted in Asia due to the macroeconomic backdrop.

Furthermore and contributing to a softer quarter for international. We faced a tough comparative period in Latin America as last year's quarter included large election related purchases.

Moving on to Hosiery and underwear.

As we expected sales in this category were down in the quarter.

We reported a 23% decrease versus the prior year stemming from bought from broad-based market demand softness, unfavorable mix and as previously communicated some program, resets towards the second half of the year.

Luca Barile: Turning our focus to margins for the quarter, our gross margin was 31.5%, a 110 basis point improvement over the prior year, primarily due to lower raw material costs, lower manufacturing costs, as well as favorable pricing. SG&A expenses were down year over year at $82 million versus $124 million last year, which included significant proxy contest and leadership changes and related matters. Excluding these charges, adjusted SG&A for the quarter was $81 million, or 8.8% of sales, compared to $66 million, or 7.7% of sales in the same quarter last year, reflecting higher general and administrative expenses and variable compensation. As you may recall, the positive impact from the Barbados Jobs Credit was $17 million in the second quarter of 2024 when this credit was introduced retroactively to January 1st, 2024, as compared to a $12 million benefit recorded in the second quarter of 2025.

Luca Barile: Our gross margin was 31.5%, a 110 basis point improvement over the prior year, primarily due to lower raw material costs, lower manufacturing costs, as well as favorable pricing. SG&A expenses were down year over year at $82 million versus $124 million last year, which included significant proxy contests and leadership changes and related matters. Excluding these charges, adjusted SG&A for the quarter was $81 million or 8.8% of sales, compared to $66 million or 7.7% of sales in the same quarter last year, reflecting higher general and administrative expenses and variable compensation. As you may recall, the positive impact from the Barbados jobs credit was $17 million in Q2 2024, when this credit was introduced retroactively to 1 January 2024, as compared to a $12 million benefit recorded in Q2 2025.

Turning our Focus to margins for the quarter.

Our gross margin was 31.5% a 110 basis, point improvement over the prior year.

Primarily due to lower raw material costs, lower manufacturing costs, as well as favorable pricing.

Sgna expenses were down. Year-over-year at 82 million versus 124 Million last year.

Which included, significant proxy contest and Leadership changes and related and related matters.

Excluding these charts adjusted sgna for the quarter was 81 million or 8.8% of sales, compared to 66 million, or 7.7% of sales in the same quarter last year.

Reflecting higher, General and administrative expenses and variable compensation.

as you may recall, the positive impact from the Barbados jobs credit, was 17 million in the second quarter of 2024, when this credit was introduced retroactively to January 1st 2024,

Luca Barile: As we bring all these elements together, adjusting for restructuring and acquisition-related items in both years and costs related to proxy contest and leadership changes, which were primarily incurred in the prior year, we generated adjusted operating income of $209 million, up $13 million, or 22.7% of net sales, flat year over year and in line with guidance provided. Moving on to taxes, the company's adjusted effective income tax rate for the quarter was 17.4%, compared to 27.2% last year, which reflected the impact of the enactment of global minimum tax in Canada and Barbados with retroactive effect to January 1st, 2024. After reflecting higher net financial expenses and a lower outstanding share base, we reported record adjusted diluted EPS of 97 cents, up 31.1% year over year. Now turning to cash flow and balance sheet items for the first half of 2025.

Second quarter of 2025.

Luca Barile: As we bring all these elements together, adjusting for restructuring and acquisition-related items in both years and costs related to proxy contests and leadership changes, which were primarily incurred in the prior year, we generated adjusted operating income of $209 million, up $13 million or 22.7% of net sales flat year over year and in line with guidance provided. Moving on to taxes. The company's adjusted effective income tax rate for the quarter was 17.4%, compared to 27.2% last year, which reflected the impact of the enactment of global minimum tax in Canada and Barbados with retroactive effect to 1 January 2024. After reflecting higher net financial expenses and a lower outstanding share base, we reported record adjusted diluted EPS of $0.97, up 31.1% year over year. Now turning to cash flow and balance sheet items for the H1 of 2025.

As we bring all these elements together, adjusting for restructuring and acquisition-related items in both years, and costs related to proxy contests and leadership changes, which were primarily incurred in the prior year.

we generated adjusted operating income of 209, million up 13 million or 22.7% of net sales, flat year-over-year and in-line with guidance provided

Moving on to taxes, the company's adjusted effective income tax rate. For the quarter was 17.4% compared to 27.2% last year, which reflected the impact of the enactment of global minimum tax in Canada and Barbados with retroactive effect to January 1st 2024,

After reflecting higher net Financial expenses and a lower outstanding share base. We reported record adjusted diluted EPS of 97 cents up 31.1% year-over-year

Luca Barile: Operating cash flow was $46 million, compared to $113 million in H1 2024, primarily reflecting higher working capital investments. After accounting for CapEx of $58 million, the company consumed approximately $12 million in free cash flow in H1 2025, while generating $154 million of free cash flow in Q2. In line with our strong commitment to return capital to shareholders, during H1 of the year, we repurchased about 2.9 million shares, returning $206 million in capital to shareholders, including $68 million in dividends. Finally, we ended H1 2025 with net debt of about $1.85 billion and a leverage ratio of 2.2x net debt to trailing 12 months adjusted EBITDA, within our targeted range of 1.5x to 2.5x. Now turning to our strategy and outlook.

Luca Barile: Operating cash flow was $46 million, compared to $113 million in the first half of 2024, primarily reflecting higher working capital investments. After accounting for CAPEX of $58 million, the company consumed approximately $12 million in free cash flow in the first six months of 2025, while generating $154 million of free cash flow in the second quarter. In line with our strong commitment to return capital to shareholders, during the first six months of the year, we repurchased about 2.9 million shares, returning $206 million in capital to shareholders, including $68 million in dividends. Finally, we ended the first half of 2025 with net debt of about $1.85 billion and a leverage ratio of 2.2 times net debt to trailing 12 months adjusted EBITDA, within our targeted range of 1.5 to 2.5 times. Now turning to our strategy and outlook.

Now, turning to cash flow and balance sheet items for the first half of 2025.

operating cash flow was 46 million compared to 113 million in the first half of 2024 primarily reflecting higher working capital Investments

after accounting for capex of 58 million.

the company consumed approximately 12 million in free, cash flow in the first 6 months of 2025,

While generating 154 million of free cash flow in the second quarter.

In line with our strong commitment to return Capital to shareholders during the first 6 months of the year, we repurchased about 2.9 Million. Shares returning 206 million in capital to shareholders, including 68 million in dividends

Finally, we ended the first half of 2025 with net debt of about 1.85 billion and a leverage ratio of 2.2 times net debt to trailing 12 months. Adjusted evidence.

Within our targeted range of 1, and a half to 2 and a half times.

Luca Barile: As Glenn highlighted earlier, we are pleased with our execution and the progress made on the three pillars of our GSG strategy. First, our new manufacturing complex in Bangladesh is now fully ramped up and performing as expected. Moreover, on the innovation front, we continue to tap into the largest innovation pipeline in the company's history, with more product launches to come in '25 and into 2026. And lastly, touching briefly on ESG, we have released our 21st ESG report in May, which highlights our progress against our next generation objectives. In addition, and as we communicated in early July, Gildan was recognized as one of Canada's best 50 corporate citizens by Corporate Knights for a fourth consecutive year and was once again featured among TIME's world's most sustainable companies, which we believe is a testament to our strong commitment to sustainable practices. Now let's turn to our outlook.

Luca Barile: As Glenn highlighted earlier, we are pleased with our execution and the progress made on the three pillars of our GSG strategy. First, our new manufacturing complex in Bangladesh is now fully ramped up and performing as expected. Moreover, on the innovation front, we continue to tap into the largest innovation pipeline in the company's history, with more product launches to come in 2025 and into 2026. Lastly, touching briefly on ESG, we have released our 21st ESG report in May, which highlights our progress against our next generation objectives. In addition, and as we communicated in early July, Gildan was recognized as one of Canada's best 50 corporate citizens by Corporate Knights for a fourth consecutive year and was once again featured among TIME's World's Most Sustainable Companies, which we believe is a testament to our strong commitment to sustainable practices. Now, let's turn to our outlook.

now, turning to our strategy and Outlook,

As Glenn highlighted earlier, we are pleased with our execution and the progress made on the 3rd of our GSG strategy.

First, our new manufacturing complex in Bangladesh, is now fully ramped up and Performing as expected.

Moreover, on the Innovation front, we continue to tap into the largest Innovation pipeline in the company's history with more product, launches to come in 25 and into 2026.

And lastly, touching briefly on ESG. We have released our 21st, ESG report in May, which highlights our programs against our next generation of objectives.

In addition and as we communicated in early July Gildan was recognized as 1 of Canada's, best 50 corporate citizens, Buy corporate Knights for a fourth consecutive year and was once again featured among Times world's most sustainable companies.

Which we believe is a testament to our strong commitment to sustainable practices.

Luca Barile: Against the current fluid macroeconomic backdrop, we remain focused on our operational agility and remain committed to executing on our GSG strategy in order to drive strong financial performance. For 2025, we are reaffirming our full-year guidance while narrowing the range of adjusted diluted EPS. We expect revenue growth for the full year to be up mid-single digits, full-year adjusted operating margin to increase approximately 50 basis points, CAPEX to come in at approximately 5% of sales, adjusted diluted EPS to be in the range of $3.40 to $3.56, up between approximately 13% and 19% year over year, compared to our previous guidance of $3.38 to $3.58. And free cash flow is still expected to come in above $450 million. Further, the outlook which I just laid out is underpinned by some key assumptions, including the following.

Luca Barile: Against the current fluid macroeconomic backdrop, we remain focused on our operational agility and remain committed to executing on our GSG strategy in order to drive strong financial performance. For 2025, we are reaffirming our full year guidance while narrowing the range of adjusted diluted EPS. We expect revenue growth for the full year to be up mid-single digits. Full year adjusted operating margin to increase approximately 50 basis points. CapEx to come in at approximately 5% of sales. Adjusted diluted EPS to be in the range of $3.40 to $3.56, up between approximately 13% and 19% year over year, compared to our previous guidance of $3.38 to $3.58. Free cash flow is still expected to come in above $450 million. Further, the outlook which I just laid out is underpinned by some key assumptions, including the following.

Now, let's turn to our Outlook.

Against the current fluid macroeconomic backdrop, we remain focused on our operational agility and remain committed to executing on our GSG strategy in order to drive strong financial performance.

For 2025, we are reaffirming our full year guidance. While narrowing the range of adjusted diluted eps

We expect.

Revenue growth for the full year to be up mid single digits.

Full year, adjusted operating margin to increase approximately 50 basis points.

CapEx is expected to come in at approximately 5% of sales.

Adjusted diluted EPS to be in the range of 3.40 to 356.

Up between approximately 13% and 19% year-over-year compared to our previous guidance of $3.38 to $3.58.

And free cash flow is still expected to come in above 450 million.

Luca Barile: Firstly, we have considered the impact of tariffs currently in place in conjunction with mitigation initiatives available to us, including pricing and our ability to leverage our flexible business model as a low-cost vertically integrated manufacturer. Furthermore, the outlook continues to reflect growth in key product categories driven by recently introduced innovation, the favorable impact from new program launches and market share gains, the expected ongoing benefits from the Barbados Jobs Credit, as well as continued share repurchases under our NCIB program while remaining within our leverage framework. We also anticipate that our adjusted effective tax rate for 2025 will remain at a similar level to what we saw for the full year in 2024.

Luca Barile: Firstly, we have considered the impact of tariffs currently in place in conjunction with mitigation initiatives available to us, including pricing and our ability to leverage our flexible business model as a low-cost, vertically integrated manufacturer. Furthermore, the outlook continues to reflect growth in key product categories driven by recently introduced innovation, the favorable impact from new program launches and market share gains, the expected ongoing benefits from the Barbados jobs credit, as well as continued share repurchases under our NCIB program while remaining within our leverage framework. We also anticipate that our adjusted effective tax rate for 2025 will remain at a similar level to what we saw for the full year in 2024.

Further the Outlook, which I just laid out is underpinned by some key assumptions including the following.

Conjunction with mitigation initiatives available to us.

including pricing and our ability to leverage our flexible business model as a low-cost vertically, integrated manufacturer

Furthermore, the Outlook continues to reflect growth. In key product categories, driven by

Recently, introduced innovation.

The favorable impact from new program launches and market share gains.

The expected ongoing benefits from the Barbados jobs credit.

As well as continued share repurchases under our ncib program, while remaining within our leverage framework.

We also anticipate that our adjusted effective tax rate for 2025 will remain at a similar level to what we saw for the full year in 2024,

Luca Barile: Finally, we have also provided guidance for our third quarter with net sales expected to be up low single digits year over year, reflecting a timing shift of orders from the third quarter into the second quarter and partly into the fourth quarter. We expect our adjusted operating margin to be in the same range as the second quarter of 2025. We also expect our adjusted effective income tax rate in the third quarter of 2025 to be at a similar level to that of the full year 2024. So in summary, we are very pleased with the quarter, and we remain confident in our ability to deliver continued strong financial performance amid the dynamic macroeconomic environment. Thank you, and now I'll turn it over to Jessy.

Luca Barile: Finally, we have also provided guidance for our Q3 with net sales expected to be up low single digits year-over-year, reflecting a timing shift of orders from the Q3 into the Q2 and partly into the Q4. We expect our adjusted operating margin to be in the same range as the Q2 of 2025. We also expect our adjusted effective income tax rate in the Q3 of 2025 to be at a similar level to that of the full year 2024. In summary, we are very pleased with the quarter, and we remain confident in our ability to deliver continued strong financial performance amid the dynamic macroeconomic environment. Thank you, and now I'll turn it over to Jesse.

Finally, we have also provided guidance for our third quarter. With net sales expected to be up low single digits, year-over-year reflecting a timing shift of orders from the third quarter into the second quarter and partly into the fourth quarter.

We expect our adjusted operating margin to be in the same range as the second quarter of 2025.

We also expect our adjusted effective income tax rate in the third quarter of 2025 to be at a similar level to that of the full year 2024.

So in summary, we are very pleased with the quarter and we remain confident in our ability to deliver continued, strong financial performance amid, the dynamic macroeconomic environment.

Thank you. And now I'll turn it over to Jesse.

Jessy Hayem: Thank you, Luca. This concludes our prepared remarks, and now we'll begin taking your questions. As usual, before we move into Q&A session, I'd like to remind you to limit your questions to two, and we'll circle back for a second round if time permits. Janine, you may begin the Q&A session.

Thank you. Luca, this concludes our prepared remarks and now we'll begin taking your questions as usual before. We move into Q&A session, I'd like to remind you to limit your questions to 2, and we'll Circle back for a second round if time permits Janine. You may begin the Q&A session

Operator: Thank you. Ladies and gentlemen, at this time, we will be conducting a question and answer session. Again, to ask a question, please press star one on your touchtone phone, and to withdraw your question, please press star one again. Our first question comes from the line of Mr. Paul from Citi. Sir, your line is open.

Thank you, ladies and gentlemen. At this time we will be conducting a question and answer session again to ask a question. Please press star 1 on your touchtone phone and to withdraw your question please press star 1 again.

Our first question comes from the line of Mr. Paul from City. Sure, your line is open.

Brandon Schiedermann: Hey, everyone, this is Brandon Schiedermann for Paul Lejuez. I was hoping that you could help quantify the shifts that occurred in Q2. How much was taken from Q3 and how much shifts from Q3 into Q4? I just have a follow-up on the underwear and hosiery business. If you could parse out what was the impact from the Nike sock pause versus the core business, and how you think about that segment for the rest of the year, and anything you can share on backfilling the Under Armour business that you previously exited, what are you doing with that capacity now? Thanks.

Speaker 9: Hey, everyone. This is Brandon Chamondy for Paul. I was hoping that you could help quantify the shifts that occurred in two queue. You know, how much was taken from three queue and how much shifts from three queue into four queue? And then I just have a follow-up on the underwear and hosiery business. If you could parse out, you know, what was the impact from the Nike sock pods versus the core business, and how do you think about that segment for the rest of the year? And anything you can share on backfilling the Under Armour business that you previously exited? Like, you know, what are you doing with that capacity now? Thanks.

Hey everyone. This is uh, Brandon Shimon for Paul. Um, I was hoping that you could help uh, quantify the shifts that occurred in 2q, you know, how much was taken from 3Q and how much shifts from 3 to 2 in the 4 to 2 and then I just have a follow-up, um, on the underwear and Hosiery business. If you could parse out, you know,

What what was the impact from the Nike sock? Pause versus The Core Business. And how do you think about that segment for the rest of the year and anything you can share on back filling the underarms or business that you previously exited? Like you know, what are you doing with that capacity now, thanks.

Luca Barile: Okay. Well, thank you for your question and good morning. So with respect to the second quarter, the second quarter was a very strong quarter. ActiveWare sales were $822. They're up 12% year over year. And like we provided on our formal remarks, some of that was aided by a tailwind of orders ahead of pricing action. So I think what you have to keep in mind here is that when you take a look at the second and third quarter really in conjunction, that would yield a growth of mid-single digit. We did guide the third quarter to being revenue up low single digit, again, with a very strong performance in Q2 and some of those sales shifting to the fourth quarter. We provided guidance on the full year. Again, as a reminder, the revenue is up mid-single digit for the full year.

Luca Barile: Okay. Well, thank you for your question, and good morning. With respect to the Q2 was a very strong quarter. Activewear sales were $822. They're up 12% year-over-year. Like we provided on our formal remarks, some of that was aided by a tailwind of orders ahead of pricing action. I think what you have to keep in mind here is that when you take a look at the Q2 and Q3 really in conjunction, that would yield a growth of mid-single digit. We did guide the Q3 to being revenue up low single digit, again, with a very strong performance in Q2 and some of those sales shifting to the Q4. We provided guidance on the full year. Again, as a reminder, the revenue is up mid-single digit for the full year.

Luca Barile: And the way I think you have to really interpret the guidance across the results in the second quarter and the guidance for the remainder of the year is that you have to start with the market assumption, right? And the market assumption really is, look, you look at Q1, the market was down. We had informed the market of that. In the second quarter, the market was still down but improving, right? And that is expected to continue to improve. And the market assumption for the guide is that the market will be down to low single digit for the full year. So what we've done as a result is we've reaffirmed our top line. We're really happy with the way sales are progressing, revenue up mid-single digit.

Luca Barile: The way I think you have to really interpret the guidance across the results in Q2 and the guidance for the remainder of the year is that you have to start with the market assumption, right? The market assumption really is you look at Q1, the market was down. We had informed the market of that. In Q2, the market was still down, but improving. That is expected to continue to improve, and the market assumption for the guide is that the market will be down to low single digit for the full year. What we've done as a result is we've reaffirmed our top line. We're really happy with the way sales are progressing, revenue up mid-single digit.

Okay, well, thank you for your question and good, uh, good morning. So with respect to the the, you know, the second quarter, the second quarter was a very strong quarter, uh, activewear sales were 822. They're up, 12%, uh, year-over-year and like we, uh, provided on our, on our formal remarks. Some of that was aided by a Tailwind of orders ahead of pricing action. Um, so I think what you have to keep in mind here is that when you take a look at the second and third quarter, really in conjunction, that that would yield a growth of mid single digit, we did guide to third quarter to being uh Revenue up low, single digit again with a very strong performance in Q2, and some of those sales shifting to the fourth quarter, we provided guidance on the full year. Again, as a, as a reminder, the revenue is up mid single digit for the full year. Uh, and the way I think you have to really interpret the guidance across the second, the the results in the second quarter and the guidance for the remainder of the year is that you have to start with the market assumption.

Luca Barile: But what we've done is we've narrowed the range when it comes to EPS by two cents on the low and two cents on the high, reflecting some of the conservatism that is or uncertainty that's in the market. And I would say that from a growth perspective, again, the vectors are that we continue to take share, strong ActiveWare performance, even though the market is down. That was for the first part of your question. Maybe Chuck for the second part?

Luca Barile: What we've done is we've narrowed the range when it comes to EPS by $0.02 on the low and $0.02 on the high, reflecting some of the conservatism or uncertainty that's in the market. I would say that from a growth perspective, again, the vectors are that we continue to take share strong activewear performance even though the market is down. That was to the first part of your question. Maybe Chuck for the second part.

Chuck Ward: Yeah. Thank you, Luca. Yeah, to answer your question on the other part, you know, as Luca said, we're very happy with our ActiveWare and our new programs we delivered during the quarter, but we did have some headwinds, as we talked about a little bit in the innerware. You know, it was things like delayed store sets. There was a little market softness. But you know, yes, we do have some customers that are doing some program and product resets. That will continue to happen and ramp up throughout the year. So we do expect it to continue to improve quarter over quarter for the remaining of the year as we go forward. So you know, we often see program resets and its timing, and we work through those. So we expected some of that, and we're facing that as we go through the year.

Chuck Ward: Yeah. Thank you, Luca. Yeah, to answer your question on the other part, as Luca said, we're very happy with our activewear and our new programs we delivered during the quarter. We did have some headwinds, as we talked about a little bit in the innerwear. It was things like delayed store sets. There was a little market softness. Yes, we do have some customers that are doing some program and product resets. That will continue to happen and ramp up throughout the year. We do expect it to continue to improve quarter over quarter for the remaining of the year as we go forward. We often see program resets and its timing, and we work through those. We expected some of that, and we're facing that as we go through the year. Yeah.

Glenn Chamandy: Yeah. And it's not structural. This will work itself out and will be on a, I think, on a better pace as we go into the second half.

Glenn Chamandy: It's not structural. This will work itself out, and we'll be on, I think on a better pace as we go into H2.

Even though the market, uh, is down that was to the first part of your, of your question. Maybe check for the second part. Yeah, thank you Luca. Um, yeah. To answer your, your question on the other part. You know, as Lucas said, we we were very happy with our, our activewear and our new programs we delivered during the quarter. But we did have some headwinds as we talked about a little bit in the inner. You know, it was things like delayed store sets, uh, there was a little market softness, but, you know, yes, we do have some customers that are doing some program and product resets, um, that will that will continue to happen and ramp up throughout the year. So we do expect it to continue to improve quarter over quarter for the remaining of the year um, as as we go forward. So you know, we we cost you know, we often see program resets and its timing and we work through those. So um, we expected some of that and we're we're facing that as we go through the year. Um you and it's not structural. This will this will work itself out and we'll be on I think on a better Pace as we go into the second half.

Brandon Schiedermann: Does that imply H2 is positive in the hosiery and underwear business?

Speaker 9: Does that imply the second half is positive in the hosiery and underwear business? Anything you can quantify? Just try to think about.

Chuck Ward: Yes.

Does that imply, you know, second half is is positive and those are in underwear business.

Brandon Schiedermann: Anything you can quantify, just how to think about? Yeah.

Luca Barile: Yeah. So we provided the guide, I guess, you know, for Q3. But what we can share is that we definitely see sequential improvement in the underwear and hosiery category and positivity as we move through the rest of the year.

Chuck Ward: Yeah. We provided the guide, I guess for Q3, but what we can share is that we definitely see sequential improvement in the underwear and hosiery category, and positivity as we move through the rest of the year.

Brandon Schiedermann: Got it. Appreciate it. Thanks, and good luck.

Speaker 9: Got it. Appreciate it. Thanks. Good luck.

Anything you can quantify just try to think about. Yeah. So we so we provided the guide I guess, you know, for Q3. But what we can share is that, that we definitely we see uh sequential Improvement, uh, in the underwear and Hosiery category, uh and uh, positivity as we move through the rest of the year.

Got it. Appreciate it. Thanks. Goodbye.

Operator: Thank you. Our next question comes from the line of Mr. Chris from Desjardins. Sir, your line is open. Hello, Mr. Chris. Your line is open.

Thank you. Our next question comes from

your line is open.

Hello Mr. Chris, your line is open

Jessy Hayem: It looks like he dropped off, Janine. Can we move on to the next one?

Jessy Hayem: It looks like he dropped off, Junine. Can we move on to the next one?

It looks like he dropped off, Genie. Can we move on to the next one?

Operator: Yes, will do. Our next question comes from the line of Mr. Jay Sole from UBS. Sir, please go ahead.

Operator: Yes, we'll do. Our next question comes from the line of Mr. Jay from UBS. Sir, please go ahead.

Yes, we'll do. Our next question comes from the line of Mr. J from UBS sir, please go ahead.

Jay Sole: Great. Thank you. This is Jay Sole from UBS. My question is about the comment in the press release. You mentioned that the activewear business, you are seeing continued momentum from national accounts, and that is driven in part by continued benefit from recent changes in the industry landscape. Can you just expand on that a little bit and tell us what kind of changes you are seeing and what the opportunity is going forward? Thank you.

Speaker 9: Great. Thank you. This is Jay Soan from UBS. My question is about the comment in the press release. You mentioned that the ActiveWare business, you know, you're seeing continued momentum from national accounts, and that's driven, you know, in part by continued benefit from recent changes in the industry landscape. Can you just expand on that a little bit and tell us, you know, what kind of changes you're seeing and what the opportunity is going forward? Thank you.

Great, thank you. This is Jason from UPS. Um, my question is about the um

Uh, comment in the uh press release. You mentioned that the activewear business, you know you're seeing continued momentum from national accounts and that's driven you know in part by continued benefit from recent changes in the industry landscape. Can you just expand on that a little bit and tell us you know what kind of changes you're seeing and and what the what the opportunity is going forward. Thank you.

Chuck Ward: Yeah, Jay. It's Chuck. You know, we're continuing to see things move around. Obviously, there's a lot of change going on in the industry, also with tariffs and other things in the economic backdrop. And as we do that, we see customers continue to look to different suppliers. And one thing that we provide, obviously, with our globally vertically integrated manufacturing is, Glenn mentioned in his comments, we provide stability in an uncertain environment. And so we're seeing, you know, benefits of that. So as we see our strong ActiveWare, we POS, you know, for North America specifically, you know, it is driven by, you know, our GLB customers, our retail, and our large screen printers. And the big thing there's, as Luca talked a little bit about the market, we are continuing to gain share in key categories. I mean, we're continuing to grow in ring spun.

Chuck Ward: Yeah, Jay, it's Chuck. We're continuing to see things move around. Obviously, there's a lot of change going on in the industry also with tariffs and other things in the economic backdrop. As we do that, we see customers continue to look to different suppliers. One thing that we provide, obviously, with our globally vertically integrated manufacturing is, Glenn mentioned in his comments, we provide stability in an uncertain environment. We're seeing benefits of that. As we see our strong activewear, we POS for North America specifically, it is driven by our GLB customers, our retail, and our large screen printers. The big thing there is, as Luca talked a little bit about the market, we are continuing to gain share in key categories. We're continuing to grow in ring-spun. Specifically, Comfort Colors is continuing to do quite well, and we're growing in that.

Chuck Ward: Specifically, Comfort Colors is continuing to do quite well, and we're growing in that. So against a good, you know, against a maybe a macroeconomic backdrop that wasn't as positive, we've done quite well.

Chuck Ward: Against maybe a macroeconomic backdrop that wasn't as positive, we've done quite well.

Yeah, Jay it's Chuck. Um, you know we're continuing to to see things move around. Obviously there's a lot of change going on in the industry. Also, with tariffs and other things in in the economic backdrop. Uh and as we do that, we see customers. Continue to look, uh, to different suppliers and 1 thing that we provide, obviously with our globally, vertically integrated manufacturing, is we Glenn mentioned in his comments, we provide stability in an uncertain environment and so we're seeing, you know, benefits of that. Um, so as we see our strong activewear, we P, you know, for North America specifically, you know, it is driven by, you know, our GB customers, our retail and our, our large screen printers. Um, and the big thing there, as, as Luca talked, a little bit about the market, We are continuing to gain, share in key categories. I mean, we're continuing to grow and ring spun. Uh, specifically Comfort colors is continuing to do quite well, uh, and we're growing in that. So um,

against a good, you know, against a

Glenn Chamandy: Maybe to add on to that, as I look at we're well-positioned because of our US cotton and US yarn. We have a, I would say, a lesser impact on the impact of tariffs from particularly from Central America. One thing that we called out is that when we look at our whole manufacturing and our manufacturing capacity, what we said is that for this year, we're running around 90% of our capacity. We do have enough capacity installed today to handle the 3-year period, 2025 to 2027. As we speak, we are actually incrementally adding additional capacity in Central America because we believe there will be potential opportunity as we move forward, particularly in our positioning. Look at this is a very fluid situation every day. Tariffs are moving around. Qualifying goods and not qualifying goods, it could be anywhere between 20% to 40%.

Glenn Chamandy: And maybe add on to that is I look at, you know, we're well positioned because of, you know, our US cotton and US yarn. I mean, we have a, I would say, a lesser impact on the impact of tariffs, particularly from Central America. So, you know, one thing that we called out is that, you know, when we look at our whole manufacturing and our manufacturing capacity, you know, what we said is that for this year, we're running around 90% of our capacity. We do have enough capacity installed today to handle, you know, the three-year period, '25 to '27. But as we speak, we are actually incrementally adding additional capacity in Central America because we believe there will be, you know, potential opportunity as we move forward, particularly in our positioning. Because look, this is a very fluid situation.

Maybe a macroeconomic backdrop that wasn't, as positive. We, we've done quite well.

Maybe add on to that as I look at, you know, we're well positioned because of, you know, our us cotton and US yarn. I mean we have a I would say a a lesser impact on the impact of terrorists from particularly from Central America. So, you know, 1 thing that we called out. Is that, you know, when we look at our whole manufacturing and our manufacturing capacity, you know, what we said? Is that, for this year, we're running around 9.

Glenn Chamandy: Every day, tariffs are moving around, you know, qualifying goods, not qualifying goods. It could be anywhere between 20 to 40 percent. So these are significant tariffs, basically. and, you know, we're well positioned, we think, to take advantage of that. So, you know, it takes time for these things to develop. It just doesn't happen overnight. People just don't wake up one day and say, "Hey, I'm going to change my supply chain." But it's moving in the right direction, and we're very confident that, we're well positioned to take advantage, particularly with our national accounts. and people, you know, people book, you know, sometimes six, eight, nine months in advance because of the lead time, particularly in retail from Asia.

Glenn Chamandy: These are significant tariffs, basically. We're well positioned, we think, to take advantage of that. It takes time for these things to develop. It just doesn't happen overnight. People just don't wake up one day and say, Hey, I'm gonna change my supply chain, but it's moving in the right direction, and we're very confident that we're well positioned to take advantage, particularly with our national accounts. People book sometimes 6, 8, 9 months in advance because of the lead time, particularly in retail from Asia. As we move into forward, I think that they're taking that risk on where tariffs will be is creating uncertainty for a lot of these customers. I think we're well positioned.

Glenn Chamandy: So, you know, as we move into forward, you know, I think that, they're taking that risk on where tariffs will be is creating uncertainty for a lot of these customers. So I think we're well positioned. And, you know, like what we said in our last call is we do have good visibility as we already move into 2026, which is really a reflection of, the opportunity in hand.

Glenn Chamandy: Like what we said in our last call is we do have good visibility as we already move into 2026, which is really a reflection of the opportunity at hand.

Moving in the right direction and we're very confident that uh, we're well positioned to take advantage, particularly in with our national accounts. Um, and people, you know, people book, you know, sometimes 6, 8, 9 months, in advance because of the lead time, um, particularly in retail from Asia. So, you know, as we move into forward, um, you know, I think that they they're taking that risk on where tariffs will be is creating uncertainty for a lot of these customers. So I think we're well positioned. And you know, like what we said in our last call is we do have good visibility as we already move into 2026, which is really a reflection of uh, the opportunity in hand.

Speaker 9: Got it. Okay. Glenn, thank you so much.

Jay Sole: Got it. Okay. Well, thank you so much.

Got it. Okay, thank you so much.

Operator: Thank you. Our next question comes from the line of Brian Morrison from TD Cowen. Sir, your line is open.

Operator: Thank you. Our next question comes from the line of Brian Morrison from TD Cowan. Sir, your line is open.

Brian Morrison: Thanks very much. Glenn, I want to follow up on that comment that you're making, specifically nearshoring national accounts and GLB tariff relocation opportunities. How much can you actually increase the throughput in Honduras? With the uncertainty that's out there, can you give us some timing and magnitude potentially of the opportunity?

Speaker 9: Thanks very much. Glenn, I want to follow up on that comment that you're making, specifically nearshoring national accounts and GLB tariff relocation opportunities. How much can you actually increase the throughput in Honduras and with the uncertainty that's out there? Can you give us some timing and magnitude potentially of, you know, the opportunity?

Thank you. Our next question comes from the line of Brian Morrison. From TD Cowen. Mister your line is open.

No, thanks very much Glenn. I want to follow up on that comment that you're making specifically near Shoring national accounts and glb tariff relocation opportunities.

How much can you actually increase the throughput in Honduras and with the uncertainty that's out there? Can you give us some timing and magnitude potentially of, you know, the the opportunity

Glenn Chamandy: Well, the thing about what we're trying to do is we're adding extra capacity within the four walls of our existing facilities. We run 5 operating plants in this hemisphere, basically. We'll add a little bit in each plant, but I would say that we will be able to yield a good 10% more additional capacity overall, basically in our system, and that will be installed as we go through this year.

Glenn Chamandy: Well, we're going to, you know, and the thing about what we're trying to do is we're, you know, we're adding, you know, extra capacity within the four walls of our existing facilities. You know, it's so it's a little bit we run five operating plants in this hemisphere, basically. So, you know, we'll add a little bit in each plant. But I would say that we will be able to yield a good 10% more additional capacity overall, basically, in our system, and that will be installed as we go through this year.

Well, we're we're going to, you know, and the thing about what we're trying to do is we're, you know, we're adding, you know, extra capacity, within the 4 Walls of our existing facilities. You know, it's

Brian Morrison: 10% on $550 per plant, call it $250 million. Is that what we're saying?

Speaker 9: So 10% on 550 per plant. Call it $250 million. Is that what we're saying?

So it's a little. We we run 5 operating plants and this is hemisphere basically so you know we'll add a little bit of each plant but I would say that uh we will be able to yield a good 10% um more additional capacity overall basically in our system and that will be installed as we go through this year.

So, 10% on $550 per plant.

Call it 250 million. Is that what we're saying?

Glenn Chamandy: Well, I would say probably maybe just a little bit more than that.

Brian Morrison: Thank you. My second question. Sorry, go ahead.

Speaker 9: Thank you. And then my second question.

Uh, well I would say probably maybe maybe just a little bit more than that.

Glenn Chamandy: So.

Speaker 9: Sir, go ahead.

Glenn Chamandy: Yeah. No, you go ahead.

Brian Morrison: My second question is actually on the Bangladesh facility. I believe you've been over there now. Is it running at optimal levels of efficiency? When will the inefficiencies be out of inventory? Maybe just in terms of the cash cost savings, I think it's 25% relative to Honduras. How do you view this in various tariff scenarios?

Speaker 9: My second question is actually on the Bangladesh facility. It's, I believe you've been over there now. Is it running at optimal levels of efficiency? When will the inefficiencies be out of inventory? And maybe just in terms of the cash cost savings, I think it's 25% relative to Honduras. How do you view this in various tariff scenarios?

Thank you and then my second question. Sorry, go ahead. Yeah. No, you go ahead.

Glenn Chamandy: Okay. Well, I would say to you that, look, we're already seeing the benefit of Bangladesh because we're projecting to have operating margin expansion as we move through the year, and a lot of that operating margin expansion is coming from our Bangladeshi facility because we really haven't had the impact of our yarn modernization project hit our P&L yet. That's probably going to go into 2026. That we'll have continued operating margin improvement. That's how we're essentially being able to do that. As well as obviously as we utilize our Central American facilities, that's another Even consuming the first phase of running at 100% would allow us for additional, I think, margin improvement. When you look at Bangladesh, it's fully ramped up. Bangladesh services basically about half of the volume is going to service international markets, Europe, Canada, Japan, Australia, et cetera.

Glenn Chamandy: Okay. Well, I would say to you is that, look, we're already seeing the benefit of Bangladesh because we're projecting to have operating margin expansion as we move through the year. And a lot of that operating margin expansion is coming from our Bangladeshi facility because, you know, we really haven't had the impact of our yarn modernization project hit our P&L yet. So that's probably going to go into 2026. So that will have continued operating margin improvement. That's how we're essentially being able to do that. And as well as, you know, obviously, as we utilize our Central American facilities, that's another, you know, even consuming the first phase of running at 100% would allow us for additional, you know, I think, you know, margin improvement. But when you look at Bangladesh, it's fully ramped up.

My second question is actually on the Bangladesh facility. It's um, I believe you've been over there now. Is it running at optimal levels of efficiency? When will the inefficiencies be out of inventory? And maybe just in terms of the cash cost savings. I think it's 25% relative to Honduras. How do you view this in various tariff scenarios?

Okay, well, I would say to you that look we're already seeing the benefit of Bangladesh because we're we're projecting to have operating margin expansion as we move through the year. And a lot of that operating margin expansion is coming from um our Bangladeshi facility because you know, we really haven't had the impact of our yarn modernization project. Hit our p&l yet so that's probably going to go into 2026 so that will have continued operating margin. That's how we're successfully being able to do that.

Glenn Chamandy: And, you know, Bangladesh services basically about half of the volume is going to service international markets: Europe, Canada, Japan, Australia, etc. And the other half is coming this way, basically. So we are using US cotton in Bangladesh. So we're, you know, we're offsetting the tariff impact from US cotton. And we also have some other flexibilities within our supply chain to mitigate where some of that fabric is being sewn so that we can reduce the amount of tariffs. So we're very comfortable with our positioning. I think we have a good handle on the cost of tariffs. And like what I said earlier is that we also take minimal price increases to support to differentiate between, you know, the cost of tariffs and not so. So we've taken price to respond to it as well. So we're fully covered.

Um, and as well as, you know, obviously as we utilize our Central American facilities, that's another, you know, even consuming the first phase of running at 100% would allow us for additional, uh, you know, um, I think uh, you know, margin Improvement. But when you look at the Bangladesh it's fully ramped up.

Glenn Chamandy: The other half is coming this way, basically. We are using US cotton in Bangladesh, so we're offsetting the tariff impact from US cotton. We also have some other flexibilities within our supply chain to mitigate where some of that fabric is being sewn so that we can reduce the amount of tariff. We're very comfortable with our positioning. I think we have a good handle on the cost of tariffs. Like what I said earlier, is that we also take minimal price increases to support the differentiate between the cost of tariffs and not so. We've taken price to respond to it as well. We're fully covered. I think that we are in a better position than anybody else.

Glenn Chamandy: I think that we are in a better position than anybody else. And, you know, I think that as we move forward in the, you know, coming years, basically, as this works itself through, I think that we're in good shape. I mean, you know, yesterday, India, 25%. Vietnam is, you know, 20%, but that's on, you know, on products that are being totally produced in Vietnam. So a lot of products that are produced in Vietnam are coming from a fabric coming from China. You know, what we're seeing is that could be a 40%, you know, tariff rate. So, you know, overall, I think that we're very excited about our positioning.

Glenn Chamandy: I think that as we move forward in the coming years, basically as this works itself through, I think that we're in good shape. Yesterday, India, 25%, Vietnam is 20%, but that's on products that are being totally produced in Vietnam. A lot of products that are produced in Vietnam are coming from fabric coming from China. What we're seeing is that could be a 40% tariff rate. Overall, I think that we're very excited about our positioning. We're going to leverage our low-cost vertically integrated manufacturing, and we're excited, and it's a reflection of really of our positioning, not only on our manufacturing side, but I would say that we're well-positioned from a product side too, with all of our innovation, our brand strategy. We've got five great brands right now that we're bringing to market, and all of them are doing well.

Um, and, you know, Bangladesh Services basically about half of the volume is going to serve as International markets. Europe, Canada, Japan, Australia Etc and the other half is coming this way. Basically. So we are using us cotton in Bangladesh. So we're, you know, we're offsetting, the Tariff impact from us cotton. And we also have some other flexibilities within our supply chain to mitigate, um, where some of that fabric is being sown so that we can reduce the amount of tariffs. So we're very comfortable with our positioning. I think we have a good handle on, um, the cost of tariffs. And like, what I said earlier is that we've also take minimal price increases to support the difference differentiate between, you know, the cost of tariffs and not. So so we've taken price to, uh, to respond to it as well. So we're fully covered. Um, I think that we are in a better position than anybody else. And, um, you know, we think that as we move forward in the, you know, coming years basically as this works itself through. I think that, um,

We're in good shape. I mean, you know yesterday, India 25% Vietnam is, you know, 40 20%. But that's on, you know on, um,

Glenn Chamandy: We're going to leverage our low-cost vertically integrated manufacturing, and, you know, we're excited, and it's a reflection of really of our positioning, not only on our manufacturing side, but I would say that we're well positioned from a product side too with all of our innovation, our brand strategy. I mean, we've got five great brands right now that we're bringing to market, and all of them are doing well. And Comfort Color is knocking it out of the box again this year. So, you know, things are going well, and that's a reflection of our 12% growth in ActiveWare for the quarter.

Glenn Chamandy: Comfort Colors is knocking it out of the box again this year. Things are going well, and that's a reflection of our 12% growth in Activewear for the quarter.

Speaker 9: Very good. Thank you.

Brian Morrison: Very good. Thank you.

An active order for the quarter.

Very good. Thank you.

Operator: Thank you. Our next question comes from the line of Mark from CIBC. Sir, please go ahead.

Thank you. Our next question comes from the line of Mark from CIBC sure. Please go ahead.

Speaker 9: Yeah. Thanks. Good morning. I wanted to actually just follow up, Glenn, on your comment with regard to price. If you could just expand a little bit on the magnitude of that, the timing, and then what you've seen more broadly from competitors and how they've responded to the tariff pressures.

Mark Petrie: Yeah, thanks. Good morning. I wanted to actually just follow up, Glenn, on your comment with regard to price. If you could just expand a little bit on the magnitude of that, the timing, and then what you've seen more broadly from competitors and how they've responded to the tariff pressures.

Thanks, uh, good morning. Uh, I wanted to actually just follow up Glenn on your comment with regards to price. If you could just, uh, expand a little bit on the magnitude of that, the timing, uh, and then what you've seen, um, more broadly from competitors, um, and how they've responded to, uh, uh, to the Tariff pressures.

Glenn Chamandy: Well, I would say that, look, pricing is all over the place a little bit because we have different customers with different lead times, and we have also different product categories that have a little bit higher tariffs than others, like imported socks, for example, things like that. The pricing is sequentially being rolled out, basically, in a very uniform way. It's not substantial, I would say. When you look at the price impact, I think that's the point so far because we mitigated a lot of the tariff costs. There could be more price being rolled out as we go forward. It's not completely all done yet. I think we're in a relatively good position. All the competitors have the same issue, basically, because most of them not even having the best, the same cost structures we have.

Glenn Chamandy: Well, I would say that, look, pricing is all over the place a little bit because we have different customers with different lead times. And, you know, we have also different product categories that have a little bit higher tariffs than others, like, you know, imported socks, for example, things like that. So, you know, the pricing is, you know, sequentially being, you know, rolled out, basically, in a very uniformed way. But it's not substantial, I would say. I mean, when you look at the price impact, I think that's the point so far because, you know, we mitigated a lot of the, you know, the tariff costs. And then, you know, there could be, you know, more price being rolled out as we go forward. It's not completely all done yet. But, you know, I think we're in a relatively good position.

Glenn Chamandy: And, you know, all the competitors have, you know, the same issue, basically, because most of them are not even having the best, the same cost structures we have. So they could be further impacted than we are in terms of the tariff impact. And, you know, the one thing I think I like to always make people remember, particularly in our wholesale business, is that, you know, we were selling shirts. Wholesalers were selling our shirts, reselling them for $2.25 a shirt. So, you know, the shirt goes up by 10 cents a unit. You got to remember that that shirt is still being sold in a souvenir store for $25. So it goes from us to the distributor to the printer to a reseller to a retailer.

Well, I would say that. Look at pricing is all over the place a little bit because we have different customers with different lead times. And, you know, we have also different product categories that have a little bit higher tariffs and others like, you know, imported socks, for example, things like that. So, you know, the pricing is, you know, sequentially being, you know, like rolled out basically, um, in a very uniformed way. Um, but it's, it's not a, it's not substantial. I would say. I mean, when you look at the, the price impact, I think that's the point so far because, you know, we mitigated a lot of the, of the, um, you know, the, uh, tariff costs. And then, you know, there could be, you know, more price being rolled out as we go forward. It's not completely all done yet. Um, but you know, I think we're in a, in a relatively good position and you, you know, all the competitive competitors have, you know, have the same issue, basically? Because and and most of them not even

Glenn Chamandy: They could be further impacted than we are in terms of the tariff impact. The one thing I think I'd like to always make people remember, particularly in our wholesale business, is that we were selling shirts, wholesalers were selling our shirts, reselling them for $2.25 a shirt. The shirt goes up by $0.10 a unit. You got to remember that that shirt's still being sold in a souvenir store for $25. It goes from us to the distributor, to the printer, to a reseller, to a retailer. $0.10 a unit on a supplier that it's been something that's been handed over five times before it gets to consumer is insignificant. We have a lot of opportunity, I think, in terms of price elasticity, particularly in our wholesale business.

Glenn Chamandy: So, you know, 10 cents a unit on a supplier that it's been on something that's been handed over, you know, five times before it gets to consumer is insignificant. And we have a lot of opportunity, I think, in terms of price elasticity, particularly in our wholesale business. So, you know, I think we're well positioned, and we'll continue going, and we'll see what happens. The situation is still fluid. We don't know what happens August 1st. I mean, tomorrow is another day. But we're well positioned to navigate through any of these challenges. I can tell you that.

Glenn Chamandy: I think we're well-positioned, and we'll continue going, and we'll see what happens. The situation's still fluid. We don't know what happens 1 August. Tomorrow's another day. We're well-positioned to navigate through any of these challenges, I can tell you that.

Even having the best the same car structures we have. So they could be further impacted, uh, than we are in terms of the Tariff impact. Um, and you know, the 1 thing, I think like, I'd like to always make people remember, particularly in our wholesale business is that, you know, we were selling shirts, wholesalers were selling our shirts, reselling them for $2.25, a shirt. So, you know, the shirt goes up by 10 cents a unit, you got to remember that that shirt still being sold in the souvenir store for 205 dollars. So it goes from us to the distributor to the printer to a reseller to a retailer. So you know 10 cents a unit on a on a supplier that it's a bit on something that's been handed over you know 5 times before it gets to Consumers insignificant and we have a lot of opportunity I think in terms of price elasticity particularly in our wholesale business. So you know I think we're well positioned. Um and uh we'll continue going and we'll see what happens. Uh there's so the situation is still fluid. We we've got we don't

Speaker 9: Yeah. Okay. Fair enough. Maybe just a slightly different angle then on the pricing side. Maybe first, just if you could clarify if the price actions were sort of consistent across your different channels and sort of segments. And then if you were to look back, you know, call it six months ago to a pre-tariff or sort of unaffected pricing environment, would the price gaps to peers or competitors today be about the same, or do you think they've narrowed or expanded as a result of all of the different noise over the last half year?

Mark Petrie: Yeah. Okay. Fair enough. Maybe just a slightly different angle on the pricing side. Maybe first, just if you could clarify if the price actions were sort of consistent across your different channels, and sort of segments. If you were to look back, call it 6 months ago, to a pre-tariff or sort of unaffected pricing environment, would the price gaps to peers or competitors today be about the same, or do you think they've narrowed or expanded as a result of all of the different noise over the last half year?

Know what happens, August 1st, I mean tomorrow's another day, but uh, we're well positioned to navigate through any of these challenges. I can tell you that.

Yeah. Okay, fair enough, maybe just a a slightly different angle than on on the pricing side. Maybe first, just, if you could clarify, if the price actions were sort of consistent across your different channels, uh, and, and sort of segments. And then if you were to look back, you know, call it 6 months ago to, uh, a free tariff or or sort of

Glenn Chamandy: I would say everything's rolling in the same direction, going up equally on a product-per-product-like basis within the marketplace. There's been really no change because everybody's got the same impact. In terms of pricing, like I said earlier, we have different markets and different products with different contributions. We're consistent, I would say, within the market in all of the categories in which we sell. There's been a consistent theme because everybody's pretty much rolling in the same direction, right? Everybody's taken price where they had to, basically, depending on those products. Products that aren't made in this hemisphere had a larger impact, basically, than products from Asia, for example, that are not conducive to making in this hemisphere, like dress socks, for example. We just don't make them here. Nobody does.

Glenn Chamandy: I would say everything's rolling in the same direction, going up equally on a product-per-product-like basis within the marketplace. So there's been really no change because everybody's got the same impact. And in terms of pricing, like I said earlier, you know, we have different markets and different products with different contributions. So we're consistent, I would say, within the market in all of the categories in which we sell. So there's been a consistent theme because everybody's pretty much rolling in the same direction, right? So, and everybody's taken price where they had to, basically, depending on those products. So, you know, products that aren't made in this hemisphere, you know, had a larger impact, basically, than products that, you know, from Asia, for example, that just don't are not conducive to making in this hemisphere, like, you know, dress socks, for example.

Unaffected um, pricing environment, um, with the price gaps to peers or competitors today be about the same, or do you think they've narrowed or expanded as a result of all of the different noise over the last, uh, the last half year?

I I would say everything's rolling in the same direction. Going up equally, um, on the on a, you know, product for product like basis within the marketplace. So there's been really no change because everybody's got the same impact.

Glenn Chamandy: You know, we just don't make them here. I mean, and nobody does. So, you know, but everybody is sort of aligned, I would say, and everybody's rolled out pricing in a sequential manner, either in the wholesale market or in the retail market.

Glenn Chamandy: Everybody is sort of aligned, I would say, and everybody's rolled out pricing in sequential manner, either in the wholesale market or in the retail market.

Um, and um, in terms of pricing, like I said, earlier, you know, we have different markets and different products with different contributions. So we're consistent, I would say within the market and all of the categories in which we sell. So there's been a consistent theme because everybody's pretty much rolling in the same direction, right? So, um, and everybody's taking price where they had to basically, depending on, um, those products. So, um, you know, products that aren't made, in this hemisphere, you know, had a larger impact, basically, than products that, you know, from Asia, for example, that just don't are not conducive to making in this. Ms are like, you know, dress socks, for example. Um, you know, we just don't make them here. I mean, and nobody does so, um, so those, you know, but everybody is sort of aligned, I would say. And everybody's rolled out pricing and sequential manner. Um, either in the wholesale Market or in the retail Market,

Speaker 9: Okay. Thanks for the comments, all the best.

Mark Petrie: Okay. Thanks for the comments. All the best.

Glenn Chamandy: Thank you.

Okay, thanks for the comments. All the best.

Thank you.

Operator: Thank you. Our next question comes from the line of Mr. Martin Landry from Stifel. Please go ahead.

Operator: Thank you. Our next question comes from the line of Mr. Morton from Stouffville. Please go ahead.

Thank you. Our next question comes from the line of Mr. Morgan from stifel. Please go ahead.

Martin Landry: Good morning, everyone. I would like to talk, Glenn, about the US distributor landscape. It's been almost a year since two large distributors merged. I was wondering, what's been the impact for Gildan? Have they closed warehouses? Have they reduced inventory in the channel? Any color would be great.

Speaker 11: Hi. Good morning, everyone. I would like to talk to Glenn about the US distributor landscape. You know, it's been almost a year since two large distributors merged. I was wondering, you know, what's been the impact for Gildan? Have they closed warehouses? Have they reduced inventory in the channel? Any color would be great.

You know, have they close warehouses if they reduce inventory in the channel? Um, any color, uh, would would be great.

Glenn Chamandy: Well, I would say, look at, we haven't had an impact because our activewear sales are up 12%, so it's a good reflection of the positioning in the market, and we're continuing to take market share in that market. As regarding our largest customer today, who's now consolidated, that consolidation is completely finished. The warehouses are completely integrated. I would say the acquisition integration is completely finished. It was done in Q2. We haven't really seen any impact. In fact, we continue to see positive impact because, as we said in previous calls, there's continuing to be reduction in brands in the market. The market is over-branded, over-assorted in terms of available brands, and we are continuing to leverage our footprint. We think we're continuing to be the beneficiary consolidation, which has been happening for obviously the 25 years that it's been happening. Our brands are running.

Glenn Chamandy: Well, I would say, look, I mean, you know, we haven't had an impact because our ActiveWare sales were up 12%. So it's a good reflection of, you know, the positioning in the market, and we're continuing to take market share in that market. As regarding, you know, our largest customer today, who's now consolidated, that consolidation is completely finished. The warehouses are completely integrated. I would say the acquisition integration is completely finished. It was done in Q2. So, you know, we haven't really seen any impact. In fact, you know, we continue to see positive impact because, you know, as we said in previous calls, there's continuing to be, you know, reduction in brands in the market. I mean, the market is overbranded, oversorted in terms of available brands. And, you know, we are continuing to leverage our footprint.

Well, I would say look at, I mean, um, you know, we haven't had an impact because our active where sales are up 12%. So it's a good reflection of

Glenn Chamandy: And we think that we're continuing to be the beneficiary consolidation, which has been happening for, you know, obviously, the 25 years that it's been happening. So our brands are running. We've actually launched new brands. We have All Pro, which is a new brand that we launched this year, as well as the Champion brand. So, you know, we've got a really good, I think, footprint. And I also add on to that is that the competitive landscape is weakening, you know, even further. Our competitors are, you know, because look at we're leveraging our low-cost vertically integrated manufacturing. You know, we've seen Delta go out of business last year, a Fruit of the Loom divest their brand from the market, and other people in the industry that are having financial issues, basically, which, you know, we see.

Glenn Chamandy: We've actually launched new brands. We have All Pro, which is a new brand that we launched this year, as well as the Champion brand. We've got a really good, I think, footprint. Also add on to that is that the competitive landscape is weakening even further. Because look at we're leveraging our low-cost, vertically integrated manufacturing. We've seen Delta, who go out of business last year, Fruit of the Loom divest their brand from the market, and other people in the industry that are having financial issues, basically, which we see. I think that we're well positioned to be a leader and continue leading, and it's a good reflection of our strong performance with activewear being up 12% through the quarter.

You know, the uh, positioning in the market and we're continuing to take market share in that market. Um, as regarding, you know, our largest customer today who's now Consolidated, uh, um, that consolidation is completely finished. The warehouses are completely integrated, um, I would say the acquisition, um, integration is completely finished. It was done in Q2, so, um, you know, we haven't really seen any impact. In fact, you know, we, we continue to see positive impact because, you know, as we said in previous calls, there's continuing to be, you know, reduction in brands in the market. I mean, the market is overbranded, uh, over sorted in terms of available brands and, you know, we are continuing to leverage our, our footprint. Um, and then we think that we're continuing to be the beneficiary, consolidation, which has been happening for, you know, obviously, the 25 years that it's been happening, so our brands are running, we've actually launched new brands. Uh, we'd have all pro, which is a new brand that we launched this year. Um,

As well as the Champion brand. So, you know we've got a really good um, I think footprint. Um, and also add on to that is that the competitive landscape is weakening? Um, you know, I mean even further, um, our competitors are, you know, because look at we're

Glenn Chamandy: So I think that we're well positioned to be a leader and continue leading. And it's a good reflection of our strong performance with ActiveWare beating up 12% for the quarter.

We're leveraging our low-cost vertically, integrated manufacturing. You know, we've seen Delta of the go out of business last year of Fruit of Loom diver branch in the market and other people in the industry that are are having Financial issues basically which, you know, um, we which we see. So I think that we're well positioned to be a leader and continue leading and um and it's a good reflection of our strong performance with activewear beating up 12% for the quarter.

Speaker 11: Okay. And just on the outlook, you know, in the U, you know, we're seeing a rebound in consumer confidence, and it looks like concerns about a US recession are abating. So I'm wondering if you're seeing that with your clients, you know, especially I'd love to hear you talk about a bit more about corporate promotional activity. Do you expect corporate spending to rebound in H2?

Martin Landry: Okay. Just on the outlook, we're seeing a rebound in consumer confidence, and it looks like concerns about a US recession are abating. I'm wondering if you're seeing that with your clients. Especially, I'd love to hear you talk about a bit more about corporate promotional activity. Do you expect corporate spending to rebound in H2?

Okay. And uh, just uh,

on the Outlook, you know, um,

Glenn Chamandy: Look, we don't have a crystal ball, to be honest with you. What Luca said earlier is that, look at the market, was down in Q1. January was an anomaly, basically because of the weather, the fires, and all those things. Taking out January, I think we've seen a consistent sort of flow in the market, and that could be corporate promotional side is definitely weak. There's all different aspects of the market. That's what's so great about the printwear market. It's tourism, it's travel, it's the experience, it's creator economy, it's all these things that sort of drive the market.

Uh, in the you, you know, we're we're seeing a rebound in consumer confidence, and it looks like concerns about a US. Recession are a ba abating. So, I'm I'm wondering if you're seeing that with your clients, uh, you know, especially I I I'd love to hear you talk about a bit more about uh, corporate corporate promotional activity. Um, do you expect corporate spending to Rebound in H2?

Glenn Chamandy: Okay. You know, we don't have a crystal ball, to be honest with you. So what Luca said earlier is that, look, at the market, you know, was down in Q1. You know, January was a phenomenal anomaly, basically, because of the weather, the fires, and all those things. But taking out January, I think we've seen a consistent sort of flow in the market. And that could be, you know, the corporate promotional side is definitely weak. But, you know, there's all different aspects of the market. That's what's so great about the printware market. You know, it's tourism, it's travel, it's the experience, it's crater economy. It's all these things that, you know, sort of drive the market.

Look at, you know, we don't have a crystal ball to be honest with you. So what Lucas said earlier, is that look at the market, um, you know, was down in q1. Um, you know, January was a, a Phenom anomaly, basically, because of the weather, the fires and all those things, but taking out January, I think we've seen it consistent sort of flow in the market.

Glenn Chamandy: But, you know, we've taken an approach where we see that the market is going to slightly improve as we go through the year, and particularly because, you know, Q4 is when the market Q3 and Q4, towards the end of Q3 and Q4, we saw a greater downturn in 2024. So we're going to be comping, you know, sales on a different basis. So, you know, we're taking a view that the market is, you know, not going to be robust. I mean, we believe that consumers will come back. Interest rates still haven't moved yet. So when they do come down, that's going to create some consumer confidence again. So it's early days. You know, we're cautiously optimistic. We control what we can control, to be honest with you. And, you know, we're taking a view, and, you know, there's still a lot of uncertainty.

Glenn Chamandy: We've taken an approach where we see that the market is going to slightly improve as we go through the year, and particularly because Q3 and Q4, towards the end of Q3 and Q4, we saw a greater downturn in 2024. We're going to be comping sales up on a different basis. We're taking a view that the market is not going to be robust. We believe that consumers will come back. Interest rates are still haven't moved yet, so when they do come down, that's going to create some consumer confidence again. It's early days. We're cautiously optimistic. We control what we can control, to be honest with you. We're taking a view, and there's still a lot of uncertainty. We don't know what's going to happen tomorrow, to be honest with you.

And that could be, you know, a corporate promotional side is is definitely weak. Um, but you know, there's all different aspects of the market. That's what's so great about the printwear market, you know, it's tourism, its travel, it's the experience its creator economy, it's all these things that, you know, sort of Drive the market. But, you know, we've taken an approach where we see that the market is going to slightly improve as we go through the year and particularly because, you know, Q4 is when the market 23 and Q4 towards the end of the Q3, and Q4, we saw a greater downturn in 2024. So we're going to be competing, you know, sales at, on a different basis. So, you know, we're taking a, a, a view, is that the market is, you know, not going to be robust. I mean, we believe that consumers will come back, interest rates are still haven't moved yet. So when they do come down, that's going to create some consumer confidence again. So it's early days, you know, we're we're cautiously optimistic, we control what we can control, be honest with you. Um, and um, you know, we're taking

Glenn Chamandy: I mean, we don't know what's going to happen tomorrow, to be honest with you. So I think we're in a really good position. I think that we've laid out and delivering, we're executing. We've got strong sales, good earnings. We got good visibility as we, you know, with all the programs. You know, part of what's happening in the second half is that a lot of those new programs that we called out, which three-quarters of our program, they're being launched in the back half of this year. Our big, you know, ActiveWare programs at retail, I mean, they're just being shipped as we speak. So they're providing a good base of sales growth for us regardless, really, of where the market's going to be. And look at, with all this instability, we've already got good visibility on 2026.

Glenn Chamandy: I think we're in a really good position. I think that we've laid out and delivering. We're executing. We've got strong sales, good earnings. We got good visibility with all the programs. Part of what's happening in H2 is that a lot of those new programs that we called out, which is three-quarters of our program, they're being launched in the back half of this year. Our big activewear programs at retail, they're just being shipped as we speak. They're providing a good base of sales growth for us, regardless really of where the market's going to be. Look, with all this instability, we've already got good visibility on 2026. Look, we've got to take things with a grain of salt. We don't know what's going to happen. We're cautiously optimistic and I think we're well-positioned.

Can you give you? And, you know, there's still a lot of uncertainty. I mean, we don't know what's going to happen tomorrow, to be honest with you. So I think we're in a really good position. I think that we've laid out and delivering, we're executing. We've got strong sales, good earnings. Um, we got good visibility as we, you know, with all the programs, you know, part of what's happening in the second half is that larger those new programs that we called out, which 3 quarters of our program, they're being launched in the back half of this year, our big, you know, activewear programs at retail. I mean they're they're just being shipped as we speak. So they're they're providing a good base of sales growth for us regardless really of where the Market's going to be.

Glenn Chamandy: So look, we got to take things with a grain of salt. We don't know what's going to happen. We're cautiously optimistic, and I think we're well positioned.

And look it with all this instability. We've already got good visibility on 2026. So look, we got to take things with a grain of salt. We don't know what's going to happen and we're cautiously optimistic. And um I think we're well positioned

Speaker 9: Okay. Thank you and best of luck.

Martin Landry: Okay. Thank you and best of luck.

Okay, thank you and best of luck.

Operator: Thank you. Our next question comes from the line of Stephen from BMO Capital Markets. Sir, please go ahead.

Operator: Thank you. Our next question comes from the line of Steven from BMO Capital Markets. Sir, please go ahead.

Sir, please go ahead.

Stephen MacLeod: Thank you. Good morning, everyone. Just wondering if you can give a little bit of color around the activewear growth components in Q2. Specifically, sort of what POS growth was by fashion basics, fleece basics, and what you saw in terms of industry growth in Q2, and how your growth compared to that.

Chuck Ward: Thank you. Good morning, everyone. Just wondering if you can give a little bit of color around kind of the ActiveWare growth components in the quarter, you know, specifically sort of what POS growth was by, you know, Fashion Basics, Lease Basics, and what you saw in terms of industry growth in Q1, Q2, sorry, and how your growth compared to that.

Glenn Chamandy: Look, I would just say to you, look, our growth is driven really by our brand strategies. Our Gildan Soft Cotton technology is continuing to work well. Our Comfort Colors brand is basically on fire still. We've got very good growth. AA, our American Apparel brand, is actually gaining a lot of traction in the industry today. We launched All Pro this year. It's a brand new brand for us. It's more performance-based. It's 100% polytype products and performance. Obviously, our Champion brand is on track, which we said is going to be about $100 million business over the 3 years. All of these things are driving. If you peel back the onion within each one of the categories, it's fleece, it's ring-spun T-shirts. It's basically because we have them all in the same categories, right?

Glenn Chamandy: Okay. I would just say to you, look, our growth is driven really by our brand strategies. Our Gildan soft cotton technology is continuing to work well. Our Comfort Colors brand is basically, you know, it's on fire still. I mean, you know, we've got very good growth. AA is actually our American apparel brand is actually gaining a lot of traction in the industry today. We launched All Pro this year. It's a brand new brand for us. It's more performance-based. It's, you know, 100% poly-type products and performance. And obviously, our Champion brand is on track, which we said is going to be about a $100 million business over the three years. So all of these things are driving, and if you peel back the onion within each one of the categories, it's fleece, it's ring spun T-shirts.

Uh, thank you. Good morning everyone. Um, just wondering if you can give a little bit of color around, uh, kind of the the activewear growth components in the quarter, um, you know, specifically sort of what PS growth was, um, by, you know, fashion Basics, fleece Basics and and what you saw in terms of Industry, uh, growth in, in q1, Q2 story and how how your growth compared to that.

Look, I would just say that you look at our, our growth is driven really by our Branch strategies.

Glenn Chamandy: It's basically because we have them all in the same categories, right? So, you know, we've got a very good diverse portfolio of brands, and then we have products within those brands that are continuing to drive and take market share. So overall, we're well positioned, and it's all of these things that are continuing to contribute to our 12%, you know, ActiveWare growth.

Glenn Chamandy: We've got a very good diverse portfolio of brands, and then we have products within those brands that are continuing to drive and take market share. Overall, we're well positioned and it's all of these things that are continuing to contribute to our 12% activewear growth.

Our Gildan soft cotton technology is continuing to to work. Well, our comfort colors brand is basically, you know, it's on fire still. I mean, you know, we've got the very good growth. Um, AA is, actually our American Apparel brand, is actually gaining a lot of traction in the industry today. We launched all pro this year. It's a brand new brand for us, it's more performance-based. Um, it's um, you know, 100% poly type products and performance. And obviously our Champion brand is on track which we said is going to be about Million Dollar business over the 3 years. So, all of these things are driving and and if you peel back the onion, within each 1 of the categories, its fleece it's ringspun t-shirts. It's basically because we have them all in the same categories, right? So, you know, we've got a very good diverse portfolio of Brands and then we have products within those brands that are continuing to drive and take market share. So overall we're well positioned and

Um, is all of these things that are continuing to contribute to our 12%, uh, you know, activewear growth.

Stephen MacLeod: Okay, thank you. Then maybe just with respect to some of the new products in the back H2 of the year, you've referenced that a number of times. Can you give any specifics around what those are and what channels you're specifically referring to?

Chuck Ward: Okay. Thank you. And then maybe just with respect to some of the new products in the back half of the year, you've referenced that a number of times. Can you give any specifics around kind of what those are and what channels you're specifically referring to?

Okay, thank you and then and then maybe just with respect to some of the new products in the back, half of the year um you've referenced that a number of times. Um can you give any specifics around? Kind of what what those are and and and what channels your specifically referring to?

Speaker 9: Yeah. I mean, we, you know, I think as we said before, I think as we said before, we have a, you know, we have products across each of the categories and each of the channels that we're launching. So I would say, as Glenn said, I mean, we see some things with the new brands and things that we've launched in distributors. We have things in national accounts with some of our GLB customers. We have some additional programs with large retailers as well. So the good news is it's kind of across channels and across products.

Chuck Ward: I think as we said before, we have products across each of the categories and each of the channels that we're launching. I would say, as Glenn said, we see some things with the new brands and things that we've launched in distributors. We have things in national accounts with some of our GLB customers. We have some additional programs with large retailers as well. The good news is it's kind of across channels and across products.

Glenn Chamandy: They're meaningful, right? Because the bulk of our 3/4 of our sales increase, a lot of that's coming in H2, particularly with the large fleece program with our large national account customer, more large, more shelf space in the innerwear area. That's why we're confident really as we move into Q4, as you see the bigger increase in revenue is contributed from these new programs.

Glenn Chamandy: And they're meaningful, right? Because the bulk of our three-quarters of our sales increase, you know, a lot of that's coming in the back half, particularly with the large, you know, fleece program with our large national account customer, you know, more sales space in the innerware area. So, you know, it's all really, and that's why we're confident really as we move into really Q4, as you see the, you know, the bigger increase in revenue is contributed from a lot of these new programs.

Yeah, I mean we you know I think as we said before, I think, as we said before we have a uh you know we have products across each of the categories and each of the channels that were launching. So I would say, as Glenn said, uh I mean we see some things with the new brands and things that we've launched and Distributors, we have things in National Council with some of our glb customers, we have some additional uh programs with large retailers as well. Uh, so the good news is it's kind of a cross channels and a cross products.

And and they're meaningful, right? Because the bulk of our 3 quarters of our sales increase, you know, a lot of that's coming in the back half particularly with the large. Um, you know, fleece program at our large National count customer, um, you know more, um, large more sales spaces in um, in the innerwear area. So you know we it's all really and that's why we're confident really as we move into uh really Q4 as you see the um you know the bigger increase in revenue is is a contributor from 1 of these new programs.

Chuck Ward: That's great color. Thanks, guys. Appreciate it.

Stephen MacLeod: That's great color. Thanks, guys. Appreciate it.

That's a great color. Thanks guys, appreciate it.

Operator: Thank you. Our next question comes from the line of Mr. Luke from Canaccord Genuity. Please go ahead.

Operator: Thank you. Our next question comes from the line of Mr. Luke from Canaccro Genuity. Please go ahead.

Luke Hannan: Thanks. Good morning, and thanks for all the commentary thus far. I wanted to follow up as it relates to the outlook for the year and specifically what's being implied from an operating margin perspective. Glenn, I think you just kind of touched on it there. Q4, it sounds like, should be pretty favorable when it comes to sales program wins. I imagine that also is translating into the implied operating margin strength. I'm just more curious, I guess, about the raw materials outlook when it comes to cotton costs. It seems like it's been relatively stable of late. Should we expect those tailwinds to sort of dissipate towards the end of the year and into next? Maybe just frame up for us the drivers behind operating margin for the balance of the year.

Speaker 9: Thanks. Good morning. And thanks for all the commentary thus far. I wanted to follow up as it relates to the outlook for the year and specifically what's being implied from an operating margin perspective. Glenn, I think you just kind of touched on it there. Q4, it sounds like, should be pretty favorable when it comes to sales program wins. I imagine that also is translating into the implied operating margin strength. I'm just more curious, I guess, about the raw materials outlook. When it comes to cotton costs, it seems like it's been relatively stable of late. Should we expect those tailwinds to sort of dissipate towards the end of the year and into next? Or maybe just frame up for us the drivers behind operating margin for the balance of the year?

Thank you. Our next question comes from the line of Mr. Luke from Canada January, please go ahead.

Thanks. Good morning, and thanks for all the commentary. Thus, thus far, I wanted to follow up as it relates to the, the outlook for the year and specifically, what's being implied from an operating margin perspective, Glenn, I think you just kind of touched on it there. Q4 it sounds like should be pretty favorable when it comes to sales program wins. I imagine that also is is translating into the implied. Operating margin strength. I'm just more Curious. I guess about the raw materials Outlook when it comes to cotton cost. It seems like it's been relatively, stable of of late. Should we expect those Tailwinds to sort of dissipate towards the end of the year and, and into next, or maybe just

frame up for us, the drivers behind operating margin for the balance of the year.

Luca Barile: Yes, thank you for your question. If we start with the guide, right? We're guiding operating margin for the year to be up approximately 50 basis points versus 2024. As you alluded to, when you look at the evolution of the margin profile, in Q2, we had very strong gross margins, and we had sub 10% SG&A. When you look at the gross margin, that was delivered in part driven by lower raw material costs. That was delivered as planned. We saw some price favorability there. The way to think of the gross margin is that's going to sequentially improve. That's included within the guide. When you look at the drivers of the operating margin guide for the full year, that 50 basis point accretion, Glenn had alluded to these drivers earlier in the call. The ramp-up of our Bangladesh facility, right?

Luca Barile: Yes. Thank you for your question. So if we start with the guide, right? So we're guiding operating margin for the year to be up approximately 50 basis points versus 2024. As you alluded to, when you look at the evolution of the margin profile, you know, in the second quarter, we had very strong gross margins, and we had sub-10% SG&A. When you look at the gross margin, that was delivered in part driven by lower raw material costs. It was delivered as planned. We saw some price favorability there. The way to think of the gross margin is that's going to, you know, sequentially improve. That's included within the guide. And when you look at the drivers of the operating margin guide for the full year, that 50 basis point accretion, Glenn had alluded to these drivers earlier in the call. The ramp-up of our Bangladesh facility, right?

Yes, thank you for your for your question. So if we start with the guide, right? So we're guiding operating margin for the year to be up approximately 50 basis points versus 2024. As you alluded to. When you look at the evolution of the uh of the margin profile. You know, in the second quarter, we had strong growth, very strong growth margins and we had sub 10% sgna. When you look at the gross margin, that was delivered in part driven by lower raw material costs. That was delivered as planned. Uh, we saw some price favorability there. The way to think of the gross margin is that's going to, you know, sequentially improve that's included within the guide. Uh, and when you look at the drivers of the operating margin guide for the full year, that 50 basis,

Luca Barile: The cost advantage there that's starting to trickle in as planned. There is some of the yarn optimization, even though more of that is going to go into 2026, and the optimization of our Central American mix and network. That, in conjunction with maintaining our sub 10% in terms of SG&A and good cost control, are really the drivers behind that guide of accretion of 50 basis points for the year.

Luca Barile: The cost advantage there that's starting to trickle in as planned. There's some of the yarn optimization, even though more of that is going to go into 2026, and the optimization of our Central American mix and network. So that in conjunction with, you know, maintaining our sub-10% in terms of SG&A and good cost control are really the drivers behind that guide of accretion of 50 basis points for the year.

Luke Hannan: Okay, thanks. For my follow-up here, Glenn, you alluded to there being roughly three-quarters of the sales growth coming from some of these new programs for 2025. Is that true for 2026 as well?

Speaker 9: Okay. Thanks. And for my follow-up here, Glenn, you alluded to there being roughly three-quarters of the sales growth coming from some of these new programs for 2025. Is that true for 2026 as well?

For the year.

Glenn Chamandy: We have very good visibility for 2026, yes.

Okay. Thanks and for my my follow-up here. Glenn, you alluded to there being roughly 3 quarters of the sales growth coming from some of these new programs for 2025, is that true for 2026 as well?

Glenn Chamandy: We have very good visibility for 2026, yes.

Luke Hannan: Okay. Thank you very much.

Speaker 9: Okay. Thank you very much.

We have very good visibility for 2026. Yes,

Okay, thank you very much.

Operator: Thank you. Our next question comes from the line of Mr. Vishal from National Bank. Sir, your line is open.

Thank you. Our next question.

Michelle from National Bank, sir. Your line is open.

Vishal Shreedhar: Hi, thanks for taking my question. With respect to the market weakness, in the past, Glenn, Gildan has used the market weakness as opportunities to pick up acquisitions related to some of these competitors who are struggling. How do you foresee that evolving in the year ahead?

Speaker 9: Hi. Thanks for taking my question. With respect to the market weakness, in the past, Glenn, Gildan has used the market weakness as opportunities to pick up acquisitions related to some of these competitors that are struggling. How do you foresee that evolving in the year ahead?

Hi. Thanks for taking my question with, with respect to the the market weakness uh, in the past Glenn um Gildan is used the market weaknesses opportunities to pick up um, Acquisitions related to some of these competitors are struggling. How do you foresee that evolving in the, uh, the year ahead?

Glenn Chamandy: Well, I would say, look, right now what we're doing is we're taking share in the market. It's a lot more advantageous to gain share than buy share. We're taking advantage of the positioning, our low-cost manufacturing, and the weakness in the competitive landscape. I would say the consolidation of brands within the market. All those things are allowing us really to drive on the existing brands. What we've been able to do is actually create new brands. Our Comfort Colors is probably the fastest-growing fashion brand in the industry. It's taking share. You walk into a souvenir store today, you'll see Comfort Colors on every single one of those tables where you used to see fashion brands before. Now it's Comfort Colors because that's the place in the market that is actually growing again.

Glenn Chamandy: Well, I would say, look, right now what we're doing is we're taking share in the market. So, you know, it's a lot more advantageous to gain share than buy share. So, you know, we're taking advantage of, you know, the positioning, our low-cost manufacturing, and the weakness in the competitive landscape, and also, you know, I would say the consolidation of brands within the market. So all those things are allowing us really to drive on the existing brands. So what we've been able to do is actually, you know, create new brands. I mean, you know, our Comfort Colors is probably the fastest growing fashion brand in the industry. I mean, it's taking share. I mean, you walk into a souvenir store today, you'll see Comfort Colors on every single one of those tables where, you know, you used to see fashion brands before.

Well, I would say look at right now what we're doing is we're we're taking share um, in the market. So

you know, it's a lot more advantageous to gain share than buy share. So, you know, we're taking advantage of, you know, the positioning or low cost manufacturing and the, the the weakness in the competitive landscape and also, you know, the I would say the consolidation of Brands within the market. So all those things are allowing us really to drive on the existing Brands. So, what we've been able to do is actually, you know, create new brands. I mean, you know, our comfort colors is probably the fastest growing fashion brand in Industry. I mean, it's it's taking share. I mean, you walk into a souvenir store.

Glenn Chamandy: Now it's Comfort Colors because that's the place and market that it's actually growing again. So AA is doing really well, and now we've got additional product categories in the All Pro and Champion. So I think we're well positioned, to be honest with you, to keep taking share and staying focused and executing on our plan. And look, we're not to say that we wouldn't look at something and, you know, at the right opportunity, but, you know, right now I think we're very focused on delivering on our core strength that we laid out.

Glenn Chamandy: AA is doing really well, and now we've got additional product categories in the All Pro and Champion. I think we're well positioned, to be honest with you, to keep taking share and staying focused, and executing on our plan. Look, well, not to say that we wouldn't look at something at the right opportunity, but right now I think we're very focused on delivering on our core strength the way we laid out.

Vishal Shreedhar: Okay. There are indications that there's been a new exclusive distribution agreement between Hanes and S&S in North America. Wanted to get your comments on that and how it relates to Gildan's positioning there.

Speaker 9: Okay. And there are indications that there's been a new exclusive distribution agreement between Haines and S&S in North America. I wanted to get your comments on that and how it relates to Gildan's positioning there.

Today you'll see Comfort colors on every single 1 of those tables were, you know, usually see fashion brands before now, it's Comfort colors because that's, that's the that's the place in Market that is actually growing again. So AA is doing really well and now we've got additional product categories and the allpro and Champion. So I think we're well, positioned to be honest with you to keep taking share and staying focused um, and executing on uh, on our plan. And look, we're not to say that we wouldn't look at something and you know um at a at a at the right opportunity. But you know, right now I think we're we're very focused on delivering on our core strength. Uh, the way we're laid out,

Okay. And, um,

There are indications that um, there's been a new exclusive distribution agreement between uh Hanes and and SNS in uh, in North America. Want to get your comments on that and how it relates to uh, to Guild's position there.

Glenn Chamandy: Well, I think you're going to have to ask them that, basically, because I don't want to comment on their strategy and how they go to market. As far as we're concerned, look, we're not really affected. We're taking share. We're growing our activewear sales over this quarter by 12%. We're well-positioned with our brand strategy. Innovation, look, the one thing that I can tell you is that our innovation pipeline is strong, our innovation isn't even understood yet, and we're taking share. You got to remember, what's so unique about particularly the distributor side of the business is that the average order outside a distributor's warehouse is very small. It's only about $150. It's like one at a time, two at a time, three at a time. It's a local electrician.

Glenn Chamandy: Well, I think you're going to have to ask them that basically because I don't want to comment on, you know, their strategy and how they go to market. But as far as we're concerned, look, we're not really affected. I mean, you know, we're taking share. You know, we're growing our ActiveWare sales of this quarter by 12%. We're well positioned with our brand strategy. And innovation, look at it. I mean, the one thing that I can tell you is that our innovation pipeline is strong. And our innovation, you know, isn't even understood yet, and we're taking share. Because you got to remember, like, what's so unique about particularly the distributor side of the business is that the average order outside a distributor's warehouse is very small. It's only about $150. So it's like one at a time, two at a time, three at a time.

Well I think you're going to have to ask them that basically because they're I don't want to comment on you know their strategy and how they go to market. But as far as we're concerned look we're not really affected. I mean you know we're taking share um you know we're growing our active War sales of this quarter by 12% we're well positioned with our Branch strategy and Innovation. Look at I mean the 1 thing that I can tell you is that our Innovation pipeline.

Glenn Chamandy: It's a local electrician. And it takes time to really spread the word and to market our products and get people to understand the features and.The

Glenn Chamandy: It takes time to really spread the word and to market our products and get people to understand the features and the value relationship between our products. When you look at everything that we've done in terms of our innovation, it's not 100% understood yet. We're continuing to market. If you are at the trade show, you can saw how we laid out our booths and we're trying to explain to consumers and end users about our product. That's a constant opportunity for us to continue taking share. At the same time, we have other innovations that are continuing to come out. Investing in our vertically integrated low-cost manufacturing is allowing us in all of our markets to become the market leader.

Glenn Chamandy: value relationship between our products. So when you look at everything that we've done in terms of our innovation, it's not 100% understood yet. So it's continuing to market. We're continuing to market. And if you went to the trade show, you can saw how we laid out our booths and we're trying to explain to consumers and then users about our product. So that's a constant opportunity for us to continue taking share. At the same time, we have other innovations that are continuing to come out. So investing in our vertically integrated low-cost manufacturer is allowing us in all of our markets to become the market leader.

Is strong and our Innovation. You know, isn't even understood yet and we're taking share because you got to remember like, in what's so unique about. Particularly the distributor side of the business is that the average order outside a distributor's warehouse is very small. It's only about 150. So it's like 1 at a time 2 at a time, 3 at a time, it's a local electrician. And it takes time to really spread the word and to Market our products and get people to understand the features and the value relationship between our products. So when you look at everything that we've done in terms of our Innovation, it's not 100% understood yet so it's continuing to Smart work continuing to Market. I mean if you were at the trade show, you can saw how we how we um laid out our boosts. And we're trying to explain to Consumers and then users about our product. So that's a constant opportunity for us to continue taking share. At the same time, we have other innovations that are continue to come out. So, investing in our vertically, integrated, low-cost manufacturer is allowing us in all of our markets.

Glenn Chamandy: This is really, I would say, a differentiation between where Gildan might have been 3, 4, or 5 years ago from where we're going today, is we're investing heavily, and dealing in terms of innovation to drive share and separate ourselves from the competition that they can't replicate what we have, which just gives us a competitive advantage. That's the proof in the pudding with the type of growth we had in this quarter.

Glenn Chamandy: And you know this is really, I would say, a differentiation between where Gildan might have been three, four, four, five years ago and where we're going today, is we're investing heavily and dealing in terms of innovation to drive share and separate ourselves from the competition that they can't replicate what we have, which just gives us a competitive advantage. And that's a proof in our pudding with the type of growth we had in this quarter.

Vishal Shreedhar: Thank you.

Junine: Thank you.

To become the market leader. And um, you know, this is really, I would say a differentiation between where Guild and might have been 34445 years ago. And where we're going today is, we're investing heavily. Um, and dealing in terms of innovation to drive, share and separate ourselves from the competition that they can't. Replicate what we have, which just gives us a competitive advantage. And that's a proof in our pudding with the, you know, the type of uh growth we had in this quarter.

Thank you.

Operator: Thank you. Our next question comes from the line of Mr. John Zamparo from Scotiabank. Sir, please go ahead.

Rachel Smith: Thank you. Our next question comes from the line of Mr. John from Scotiabank. Sir, please go ahead.

Thank you. Our next question comes from the line of Mr. John from Scotia Bank sir, please go ahead.

John Zamparo: Thank you very much. Good morning. I wonder if you could give a sense of what those capacity increases in Central America might cost. You have your CapEx guidance for this year, of course, but wondering if we should expect maybe a step up in future years, or do these expansion efforts come with a low enough level of capital spending that this is part of fairly normal course CapEx?

Speaker 4: Thank you very much. Good morning. I wonder if you could give a sense of what those capacity increases in Central America might cost. You have your CapEx guidance for this year, of course, but wondering if we should expect maybe a step up in future years or do these expansion efforts come at the low enough level of capital spending that this is part of fairly normal course CapEx?

Glenn Chamandy: Well, look, we're going to live within our CapEx guide for sure, number one. Look, there's no big infrastructure to put in because we're actually expanding in the existing facilities that already have all the infrastructure in place. Basically, we've got 50 machines. You put 5 more machines in. It's as simple as that. We've got space in our facilities. We re-laid out some of our plants basically to allocate the more capacity. That's what we do best, right? I think, look, it's a minimal investment for a good return because not only is it going to give us incremental revenue stream, but it's also going to come at a much more advantage cost structure because we're running obviously more capacity through the same four walls. It's a win-win for us, and it's a good use of capital.

Glenn Chamandy: Yeah. Well, look, we're going to live within our CapEx guide for sure, number one. And you know because look at the there's no big infrastructure to put in because we're actually expanding in the existing facilities that already have all the infrastructure in place. So you know basically, we've got 50 machines. You put five more machines in. I mean, it's as simple as that. So we've got space in our facilities. We relayed out some of our plants basically to allocate the more capacity. And that's what we do best, right? So I think, look, it's a minimal investment for a good return because not only is it going to give us incremental revenue stream, but it's also going to come at a much more advantaged cost structure because we're running obviously more capacity through the same four walls.

Thank you very much. Good morning. Uh, I wonder if you hear the sense of what those capacity increases in Central America might cost, you have your capex guidance for this year, of course, but wondering if we should expect maybe a step up in future years, or do these expansion and efforts come with a low enough level of capital spending that, that this is uh, part of Fairly normal course capex.

Glenn Chamandy: So it's a win-win for us, and it's a good use of capital. We also have, you know, like we still have the capabilities. And in our guide for our next three years, we actually included to build out the plan to the second phase of our Bangladeshi facility. That's also included in maintaining our 5% of sales and our CapEx. So that's still in our plans. You know, we're going to obviously just wait out until we make sure that we're still well positioned because we don't know where the wind will blow after these tariff situations play out. That's one of the reasons why we're also expanding in Central America because we have probably a little bit better understanding of what's going to happen in this region.

Glenn Chamandy: We still have the capabilities, and in our guide for our next 3 years, we actually included to build out the plant, the second phase of our Bangladeshi facility. That's also included in maintaining our 5% of sales in our CapEx. That's still in our plans. We're going to obviously just wait out until we make sure that we're still well-positioned because we don't know where the wind will blow after this tariff situation lays out. That's one of the reasons why we're also expanding in Central America, because we have probably a little bit better understanding of what's going to happen in this region. Once we see over the next month or two, and we get good color on Bangladesh, our plan is to also continue to develop in that region as well.

For sure, number 1. And, you know, because look at the, there's no big infrastructure to put in because we're actually expanding in the existing facilities that are already have all the infrastructure in place. So, you know, basically we've got 50 machines, you put 5 more machines in. I mean, it's as simple as that. So, um, we've got space in our facilities. We relay out some of our, you know, our plants basically, to allocate the more capacity. Um, and that's, that's what we do best, right? So I think look at it. It's um, it's, it's a minimum investment for a good return because not only is it going to give us incremental Revenue stream but it's also going to come at a, a much more Advantage cost structure because we're running, obviously more capacity through the same 4 Walls. So it's a win-win for us, and uh, it's a, it's a good use of capital. We also have, you know, like we still have the capabilities and in our guide. For our next 3 years, we actually included. Um you know the build out the plan the second phase of our bangle Dashi facility. That's also

included in, you know, maintaining our 5% of of sales and our our cap back. So that's still in our plans. Um, you know, we've we're going to obviously just wait out until make sure that the we're still well positioned because we don't know the way the wind will blow after these tariffs situation lays out. That's 1 of the reasons why we're also expanding in, in Central America because we have probably a little bit

Better understanding what's going to happen in this region.

Glenn Chamandy: But once we see over the next month or two and we get good color on Bangladesh, I mean, our plan is to also continue to develop in that region as well.

Um but once we see in, you know, over the next month or 2 and we get good color on a Bangladesh. I mean, our plan is to also continue to um, develop in that region as well.

John Zamparo: Okay. Thank you for that. On international markets, I wonder if you could add some color here on the macro picture, which is what you'd referenced in the press release. It's such a sizable divergence from the US, and I wonder what you attribute that to. Is there something specific to Gildan's international customer base or product set, and how do you expect that segment to perform in H2?

Speaker 4: Okay. Thank you for that. And then on international markets, I wonder if you could add some color here on the macro picture, which is what you'd referenced in the press release. It's such a sizable divergence from the US, and I wonder what you attribute that to. Is there something specific to Gildan's international customer base or product set, and how do you expect that segment to perform in the second half?

Okay, thank you for that. And, and then on International markets, I wonder if you could add some color here on the macro picture, uh, which is what? What you'd referenced in the press release. It's such a sizable Divergence from the US, and I wonder what you attribute that to is there something specific to gildan's International customer base, or, or product set? And how do you expect that segment to perform in the second half?

Glenn Chamandy: Well, I'll just start with the first part of the question, maybe then Chuck will answer the rest. I would say, look, the one thing you have to keep in mind is that our international businesses are relatively smaller in size just because of the way the markets function, right? T-shirts, for example, in the US are screen printed, and sold to consumers at a very inexpensive cost structure, where in Europe, the cost of printing and reselling shirts is much more expensive in countries like Germany and France, et cetera. Just the market dynamics aren't the same. We expect that when you look at our international sales, which we guided to over 25 to 27 at the end of the period, our international revenue should be around 10% of our activewear sales.

Glenn Chamandy: Well, I'll just start with the first part of the question, maybe in a chuckle answer to the rest. But I would say, look, the one thing you have to keep in mind is that our international businesses are relatively smaller in size just because of the way the markets function, right? I mean, you know, T-shirts, for example, in the US are screen printed and sold to consumers at a very inexpensive cost structure where in Europe, the cost of printing and reselling shirts is much more expensive in countries like Germany and France, etc. So just the market dynamics aren't the same. And you know, we expect that when you look at our international sales, which we guide it to over 25 to 27 at the end of the period, our international revenue should be around, you know, 10% of our active sales.

Well, I'll just start with the first part of the question. Maybe, I'm chuckle, answer to the rest, but I would say, look at the, the 1 thing you have to keep in mind.

Is it that our international businesses are relatively smaller in size just because of the...

The way the markets function, right? I mean, you know, t-shirts for example, in the US are screen printed and sold to Consumers at a very inexpensive cost structure where in Europe, the cost of, you know, Printing and reselling shirts is much more expensive than countries like Germany and France. Etc. So just the market dynamics aren't the same.

Glenn Chamandy: Just keep that in mind, because that's a reflection more of the size of the market, really, than it is our ability to take the market. We're equally as positioned in those markets as we are in the North American market. We may not have as much market share, because the market is a little bit more fragmented. Overall, we've got the same positioning. Chuck will talk about the nuances today.

Glenn Chamandy: So just keep that in mind because that's a reflection more of the size of the market really than it is our ability to take the market. So we're equally as positioned in those markets as we are in the North American market. We may not have as much market share because the market is a little bit more fragmented, but overall, we've got the same positioning. And Chuck will talk about the nuances and do this.

John Zamparo: Okay, thanks, Glenn.

Operator: Okay. Thanks, Glenn. Yeah. I mean, I think as we look at the international markets, I think some of it Luca covered in his comments, but you know, it was a little lower than we expected. I mean, the UK is, I mean, we've seen economically challenges in the UK globally. Everybody can see it. And so we did see some challenges there and a little lower than expected. But really, when you think about year-over-year comps, we were comping two things: one, that Luca called out, and one that we didn't. And one was Latin America, which he mentioned with the Mexico election last year. And that always runs up demand. But also, we launched our Style 3000 last year into Europe, so during Q2. And so you kind of have some load in there.

Chuck Ward: I think as we look at the international markets, I think some of it Luca covered in his comments. It was a little lower than we expected. We've seen economically challenges in the UK, globally. Everybody can see it. We did see some challenges there and a little lower than expected. Really, when you think about year-over-year comps, we were comping two things. One that Luca called out and one that we didn't, one was Latin America, which he mentioned with the Mexico election last year. That always runs up demand. Also when we launched our Gildan 3000 last year into Europe, so during Q2, you have some load in there. We're still very happy, as Glenn said, with our international business.

And, you know, we expect that when you look at our International sales, which we guided to over 25 to 27 at the end of the period, our International Revenue should be around, you know, 10% of our active, our sales. So just keep that in mind. Because that's, that's a reflection more of the size of the market, really than it is our ability to take the market. So we're equally as positioned in those markets as we are in the North American Market, we may not have as much market share, um, because the market is a little bit more fragmented, but overall we've got the same positioning um, and, you know, Chuck will talk about, you know, the nuances and the okay. Thanks, Glenn. Yeah, I mean, I think as we look at the international markets, I think some of it, uh, Luca covered in his in his comments. But uh, you know, it was a little lower than we expected. I mean, the, the UK is you, I mean, we've seen economically challenges in the UK um, globally. Everybody can see it. And, and so we did see some challenges there and lower lower the expected. But really, when you

Operator: And so we, you know, we're still very happy, as Glenn said, with our international business. As a matter of fact, if I look at Q3, POS has significantly improved in the first part of Q3. So it's looking good there. And we're very comfortable as we look at that three-year target and saying that international sales will represent 10% of active sales; I think we're very comfortable with that target going forward.

Chuck Ward: Matter of fact, if I look at Q3, POS is significantly improved in the first part of Q3, so it's looking good there. We're very comfortable as we look at that three-year target and saying that international sales will represent 10% of activewear sales. I think we're very comfortable with that target going forward.

Think about year-over-year, comps we work. Comping, 2 things that, uh, 1 that Luca called out and 1 that we didn't and, and 1 was Latin America, which he mentioned would, you know, the Mexico election last year? Uh, and that always, uh, runs runs up demand. But also in we launched our style 30000 uh, last year into Europe. Uh, so during Q2 and and so you you kind of have some load in there. Um, and so we, you know, we're still very happy as Glenn said, with our international business and matter of fact, if I look at the Q3 uh, PS is

Significantly improved in the first part of Q3 so it's looking looking good there but and we're very comfortable as we look at that 3 year Target and and saying that International sales represent 10% of activewear sales. I think we're very comfortable with that Target going forward.

John Zamparo: Okay. I appreciate the color. Thank you.

Speaker 4: Okay. I appreciate the color. Thank you.

Okay, I appreciate the color. Thank you.

Operator: Thank you. Our last question comes from the line of Mr. Chris Lee from Desjardins. Sir, please go ahead.

Rachel Smith: Thank you. Our last question comes from the line of Mr. Chris from Desjardins. Sir, please go ahead.

Jessy Hayem: Oh, thanks very much. And sorry about earlier. Glenn, I know everything is still very fluid, but if tariffs in Bangladesh were to revert to the high rate of 35%, it sounds like the plan is to shift the production of ring spun back to Central America. And if that's the case, how quickly will you be able to fill out the unused capacity in Bangladesh? And would that have some impact on margins in the near term?

Chris Lee: Oh, thanks very much, and sorry about earlier. Glenn, I know everything is still very fluid, but if tariffs in Bangladesh were to revert to the high rate of 35%, it sounds like the plan is to ship the production of ring spun back to Central America. If that's the case, how quickly will you be able to fill out the unused capacity in Bangladesh, and would that have some impact on margins in the near term?

Thank you. Our last question comes from the line of Mr. Chris from deardon, sure. Please go ahead.

Quickly, will you be able to fill out the unused capacity in Bangladesh? And would I have some impact um, on margins in the near term?

Glenn Chamandy: What I said earlier is that half of the capacity that would currently, which we started the year, we optimize our plants by product category. Okay, that's one. Since the tariffs have come in, what we've done is we basically shifted the volumes that are supporting our international sales, Canada, Europe, Japan, Australia, and China. All that product is being produced today in Bangladesh, which is just slightly more than half of the volume. The remaining volume is basically being sold in ring spun type products, and it's coming back to North America. We have the ability to repurpose the production from that plant and sell it in geographical regions that basically allow us to mitigate the tariff impact. We're basically, I would say that we've got a good handle on tariffs. I think we're well-positioned.

Glenn Chamandy: What I said earlier is that half of the capacity that we're currently, which we didn't, we started the year, we optimized our plants by product category. Okay. So that's one. But since the tariffs have come in, what we've done is we basically shifted the volumes that are supporting our international sales: Canada, Europe, Japan, Australia, China. All of that product is being produced today in Bangladesh, which is just slightly more than half of the volume. The remaining volume is basically being sold in ring spun type products, and it's coming back to North America. We have the ability to repurpose the production from that plant and show it in geographical regions that basically allow us to mitigate the tariff impact. So you know, we're basically, I would say that you know we've got a good handle on tariffs. I think we're well positioned.

Glenn Chamandy: We're also using US cotton in Bangladesh as well, that's another advantage. The part that we're actually bringing back to this hemisphere is probably not any worse tariff than what we're producing today in Central America. We've got a very good positioning on where we are today. Now we'll wait and see what happens because right now Bangladesh has got a 10% tariff. Will they be tariffed at a higher rate? We'll adjust these things as we go forward. We got, again, a lot of flexibility in our operations, and we're very comfortable with our positioning as we go forward.

Glenn Chamandy: We're also using US cotton in Bangladesh as well. So that's another advantage. So the part that we're actually bringing back to this hemisphere is probably not any worse tariff than what we're producing today in Central America. So we've got a very good positioning on where we are today. So now we'll wait and see what happens because you know right now Bangladesh has got a 10% tariff. You know, will they be tariffed at a higher rate? You know, we'll adjust these things as we go forward. But we got, again, a lot of flexibility in our operations, and you know we're very comfortable with our positioning as we go forward.

What I said earlier is that, you know, half of the capacity that we're currently using, which we didn't – we started the year, we optimized our plans by product category. Okay, so that's one. But, you know, since the tariffs have come in, what we've done is, we've basically shifted the volumes that are supporting our international sales in Canada, Europe, Japan, Australia, China; all of that product is being produced today in Bangladesh, which is, you know, just slightly more than half of the volume. The remaining volume is basically being sold in, you know, in ring-spun type products and it's coming back to North America. We have the ability to, you know, to repurpose the production from that plant and show it in geographical regions that basically allow us to mitigate the tariff impact. So, you know, we're basically, I would say that, you know, we've got a good handle on tariffs. I think we're well positioned.

We're also using us cotton in Bangladesh as well, so that's another Advantage. So, the part that we're actually bringing back to this, this hemisphere is probably not any worse. Um, tariff than what we're producing today in Central America. So we've got a very good, uh, positioning on on where we are today. So now, we'll wait and see what happens.

Chris Lee: Okay. No, thanks for the clarification. My second question, and maybe this one is for Luca. Even though you narrow your EPS guidance range, still fairly wide with half a year to go, which is understandable given all the macro uncertainties. I just wanted to get a sense of what are some of the key differences between the low end and the high end of your EPS guidance?

Jessy Hayem: Okay. No, thanks for the clarification. And my second question, and maybe this one is for Luca, even though you narrow your EPS guidance range, you know, still fairly wide with half a year to go, which is understandable given all the macro uncertainties. And I just wanted to get a sense of what are some of the key differences between the low end and the high end of your EPS guidance?

Happens because you know, right now, Bangladesh has got a 10% tariff. Um, you know, will they be um, tear up at a higher rate, you know, will adjust these things as we go forward. But we got again, a lot of flexibility in our in our operations and um, you know, we're very comfortable with our positioning as we go forward.

Okay, no, thanks for the clarification and my second question, maybe this 1 is for Luca. Um, even though you've looked you narrow, your EPS guidance range, you know, still fairly wide with half a year to go which is understandable, given all the macro uncertainties and I just wanted to get a sense of what, what are some of the key differences between the low end and the high end of your EPS guidance?

Glenn Chamandy: Yeah. Thank you for your question, Chris. So again, when you look at the guide, first of all, we're pleased with the performance so far. As I articulated earlier in the call, I think it all starts with the market assumption. Last time, you know, we gave the market assumption supporting the guide was that the market would be flat to down low single digit. Now it's more to down low single digit, even though there's sequential improvement in the market over the year. And then when you take a look at the EPS guidance that we provided, again, we took a balanced approach, right? There's some puts and takes. If you look at things like that would be accretive, there's more share gains that potentially we can go and get further wins and so forth.

Luca Barile: Yeah, thank you for your question, Chris. Again, when you look at the guide, first of all, we're pleased with the performance so far. As I articulated earlier in the call, I think it all starts with the market assumption. Last time, we gave the market assumption supporting the guide was that the market would be flat to down low double digit. Now it's more to down low single digit, even though there's sequential improvement in the market over the year.

Luca Barile: When you take a look at the EPS guidance that we provided, again, we took a balanced approach, right. There's some puts and takes. If you look at things that would be accretive, there's more share gains that potentially we can go and get further wins, and so forth. On the risk end, you have more slowdown in general demand or less of a quick recovery. There's puts and takes. We're cautiously optimistic on that guide, but we're comfortable with that guide. That all starts with the top line, the consistent margin profile making its way down to the EPS, the range that we've now given of $3.40 to 3.56. Hopefully that helps.

Glenn Chamandy: And then on the risk end, you have slowed down in more slowdown in general demand or less of a quick recovery. So there's puts and takes. We're cautiously optimistic on that guide, but we're comfortable with that guide. And that all starts with the top line, the consistent margin profile making its way down to the EPS range that we've now given of 340 to 356. So hopefully that helps.

Yeah, thank you for your question, Chris. So again, when you look at the uh, at the guide, uh, first of all, we're we're pleased with the performance so far. Uh, as I articulated earlier in the call, I think it's all starts with the market. Assumption last time, you know, we gave the the market assumption for the guide was, uh, that the the market would be flat to down low single digit. Now, it's more to download single digit even though they're sequential Improvement in the market over over the year. Uh, and then, when you take a look at the, at the EPS, um, guidance that we provided again, we took a balanced approach, right? There's some puts and takes, uh, if you look at things like that, that would be accretive. There's more sheer gains that potentially we can go and get further wins, uh, and so forth. And then on the, uh, on the risk end, you have, you know, slow down in in in more slow down in

Chris Lee: Okay. No, it is. Thanks very much and all the best.

Jessy Hayem: Okay. No, it is. Thanks very much and all the best.

General demand, or less of a quick recovery. So there's, there's puts and takes, we know we're cautiously optimistic on on that guide, uh, but we're comfortable with that guide, uh, and uh, and that all starts with the Top Line, the consistent margin profile making its way down to the EPS the range that we've now given of 340 to 356. So hopefully that helps

Luca Barile: Thank you.

Glenn Chamandy: Thank you.

Okay, you know it is. Thanks very much and all the best.

Thank you.

Operator: Thank you. This concludes our question and answer session. I will now turn the call over to Jessy for closing remarks.

Rachel Smith: Thank you. This concludes our question and answer session. I will now turn the call over to Jessy for closing remarks.

Thank you. This includes our question and answer session. I will now turn the call over to Jesse for closing remarks.

Jessy Hayem: Thank you. We just would like to thank everyone for joining us and attending our call today. We do look forward to speaking with you soon. Have a great day.

Luca Barile: Thank you. We just would like to thank everyone for joining us and attending our call today. And we do look forward to speaking with you soon. Have a great day.

Thank you. I just would like to thank everyone for joining us and attending our call today and uh, we do look forward to speaking with you soon. Have a great day.

Operator: This concludes today's conference call. You may now disconnect.

Rachel Smith: This concludes today's conference call. You may now disconnect.

this concludes today's conference call, you may now disconnect

[Analyst]: Get off of work and we meet down at our spot. We had a patio with a view of a parking lot. It was 2 for 1 and 4 for 2. Had Christmas lights in the middle of June. All hung up like I was on you. I said, Hey, hey baby, do you wanna come over? You say, No way then you move in closer. Next thing I know you were in my T-shirt. Right there, your hair messed up like

Speaker 9: Did you get off of work and we meet down at our spot? We had a patio with a view of a parking lot. It was two for one and four for two. Had Christmas lights in the middle of June. All hung up like I was on you. I said, "Hey baby, do you want to come over?" You say no and then you move in closer. Next thing I know, you were in my T-shirt right there. Your hair matched up like.

we get off of working with me down at our spot.

We had a panel with a view of parking lot.

It was 2 for 1 and 4 for 2.

Fish from slides in the middle.

Like I was on you.

Say hey baby. Do you want to come over?

Say no. Wait and you're moving closer.

this thing I know you were in my

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