-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UY9vA6UoF5fTW/wQTuEgmp3jCEvqp1YF++tmDA2APnUb/Wg4Dwd5s4ll09RJdh++ qbV61Mat1Esg96tjJBaHjQ== 0001157523-04-010070.txt : 20041029 0001157523-04-010070.hdr.sgml : 20041029 20041029060036 ACCESSION NUMBER: 0001157523-04-010070 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041029 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041029 DATE AS OF CHANGE: 20041029 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DELTA APPAREL INC CENTRAL INDEX KEY: 0001101396 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-APPAREL, PIECE GOODS & NOTIONS [5130] IRS NUMBER: 582508794 STATE OF INCORPORATION: GA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15583 FILM NUMBER: 041104171 BUSINESS ADDRESS: STREET 1: 2750 PREMIERE PARKWAY SUITE 100 CITY: DULUTH STATE: GA ZIP: 30096 BUSINESS PHONE: 7708066800 MAIL ADDRESS: STREET 1: 2750 PREMIERE PARKWAY SUITE 100 CITY: DULUTH STATE: GA ZIP: 30096 8-K 1 a4754040.txt DELTA APPAREL SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (Date of earliest event reported): October 29, 2004 Delta Apparel, Inc. ------------------------------ (Exact name of registrant as specified in its charter) Georgia ---------------------------- (State or Other Jurisdiction of Incorporation) 1-15583 58-2508794 ------------------- --------------------------------- (Commission File Number) (IRS Employer Identification No.) 2750 Premiere Parkway, Suite 100, Duluth, Georgia 30097 - ------------------------------------------------- --------------- (Address of principal executive offices) (Zip Code) (678) 775-6900 ------------------------------ (Registrant's Telephone Number Including Area Code) Not Applicable -------------- (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the folloiwng provisions (see General Instruction A.2. below) [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition On October 29, 2004, the Company issued a press release containing financial information and accompanying discussion for the quarter ended October 2, 2004. Item 7.01 Regulation F-D Disclosure On October 29, 2004, Delta Apparel, Inc. issued its earnings release for the fiscal quarter ended October 2, 2004. The earnings release is set forth as Exhibit 99.1 to this Current Report and is incorporated herein by reference. Robert W. Humphreys, President and CEO, will hold an analyst conference call on Friday, October 29, 2004 at 10:00 a.m. Eastern Time to discuss financial results and give a business update. The conference call will be broadcast through the Company's web site at www.deltaapparel.com. Investors may listen to the call by selecting "investor relations" then "company news." A replay of the webcast will be available within one hour of the call and will be archived at the above address for 30 days following the release. The information in this Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Item 9.01 Financial Statements and Exhibits (a) Not applicable (b) Not applicable (c) The following exhibits are included with this Report: 99.1 Press release issued by Delta Apparel, Inc. on October 29, 2004. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. DELTA APPAREL, INC. Date: October 29, 2004 /s/ Herbert M. Mueller ------------------------------------------- Herbert M. Mueller Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit Number Description - -------------- ----------- 99.1 Press release issued by Delta Apparel, Inc. on October 29, 2004. EX-99.1 2 a4754040ex991.txt PRESS RELEASE Exhibit 99.1 Delta Apparel Reports Record Sales for the First Quarter of Fiscal Year 2005; Board of Directors Declared Quarterly Dividend of $0.07 Per Share DULUTH, Ga.--(BUSINESS WIRE)--Oct. 29, 2004--Delta Apparel, Inc. (AMEX: DLA) announced record sales for three months ended October 2, 2004 of $54.3 million, an increase of $23.5 million, or 76.3%, from the prior year quarter due primarily to the acquisition of M. J. Soffe Co. ("Soffe") Gross margins for the quarter ended October 2, 2004 improved to 21.3% compared to 13.3% in the prior year quarter. The improvement in gross margin was primarily the result of the higher gross margins associated with the Soffe branded apparel business, offset partially by lower gross margins in the basic tee shirt business. The gross margins on basic tee shirts declined in the first fiscal quarter compared to the prior year quarter principally due to higher raw material costs. We achieved operating income of $3.1 million for the quarter ended October 2, 2004, an increase of $2.0 million, or 184.5%, from $1.1 million in the first fiscal quarter of the prior year. Basic and diluted earnings per share for the quarter ended October 2, 2004 were $0.35 and $0.34 per share, respectively, compared to basic and diluted earnings per share in the prior year quarter of $0.15 and $0.14, respectively. Robert W. Humphreys, President and CEO, commented, "Our focus on the distribution of our products continues as we increase our customer base and broaden our product lines. The Delta segment shipped product to approximately 26% more customers during the quarter than in the prior year quarter. In addition to our pending acquisition of a modern distribution facility in Tennessee, we have finalized a lease on a new distribution center to service the northeastern states and expect to start serving customers from this center by spring of 2005. We have new styles of spring merchandise available for all distribution channels in our Soffe business and recently introduced a full line of fleece products under the Delta label. The initial sales response to the new styles has been positive and we believe these products will help reduce our seasonality and strengthen our sales. "We are pleased with the integration of Soffe with the Delta business. As part of our long-term succession planning, we recently appointed Ken Spires as President of M. J. Soffe Co. Ken was previously the Vice President of Technical Services at Delta Apparel and has over 25 years of experience in the industry. Jim Soffe will continue to serve as Chief Executive Officer of M. J. Soffe Co. As we continue to take advantage of the combined purchasing power and synergies of the two businesses, we expect to see continued success as an integrated company." Our financial results for the quarter ended October 2, 2004 were positively impacted by the acquisition of Soffe in October 2003. The Soffe business contributed $22.0 million in sales and $3.1 million in operating income during the first fiscal quarter of fiscal year 2005. The Soffe segment exceeded its sales expectations in its military distribution channel and expects the strong sales in this channel to continue through the fiscal year. Demand for the Soffe brand continues to be strong and we continue to expand our Soffe product offering through the addition of new styles and colors. The new Soffe product line, coupled with proper inventory levels, should allow this segment to achieve increased sales through the spring selling season. The Delta business reported sales of $33.4 million for the three months ended October 2, 2004, an increase of $2.6 million, or 8.5%, from sales in the prior year quarter. Operating income for the first fiscal quarter was $9 thousand, a decrease of $1.1 million from the prior year quarter primarily as a result of the higher priced raw materials discussed above. The increased raw material cost was partially offset by higher average selling prices on basic tees and increased sales of specialty products. The Delta segment focused on increasing the sales of its higher margin colored products, decreasing its sales of white products to 31% of sales, down from 39% in the prior year quarter. In addition, the Delta segment just recently released its new line of fleece products, including sweatshirts and sweatpants. Accounts receivable increased $12.0 million from September 27, 2003 to $29.4 million on October 2, 2004. The increase in accounts receivable was primarily the result of the addition of Soffe. Inventories increased $55.7 million from September 27, 2003 to $105.9 million on October 2, 2004. The acquisition of M. J. Soffe Co. resulted in an increase of $52.7 million in inventory compared to the prior year. The increase in inventory in the Delta business is primarily the result of the higher raw material prices in inventory. We continue to focus on managing our inventory levels while maintaining the inventory necessary to achieve our expected sales growth in fiscal year 2005. Delta Apparel also announces today that on October 28, 2004, the Board of Directors declared a dividend of seven cents per common share of stock payable November 29, 2004 to shareholders of record as of the close of business on November 17, 2004. This dividend was declared pursuant to our previously announced quarterly dividend program, which we may amend or terminate at any time. About Delta Apparel, Inc. Delta Apparel, Inc., along with its wholly owned subsidiary M. J. Soffe Co., is a vertically integrated marketer, manufacturer and distributor of high quality branded and private label activewear apparel. We specialize in selling a variety of casual and athletic activewear tops and bottoms, embellished and unembellished T-shirts, and fleece products for the ever-changing apparel market. We focus on our broad distribution of products, currently serving over 13,000 customers. We sell our products to screen printers, private label accounts, sporting goods stores, department stores and distributors. In addition, certain products are sold in college bookstores and to the U.S. Military. Our operations are in the United States, Honduras, Mexico and Costa Rica and we employ approximately 4,500 worldwide. Additional information on our company is available at www.deltaapparel.com. Statements and other information in this press release that are not reported financial results or other historical information are forward-looking statements. These are based on our expectations and are necessarily dependent upon assumptions, estimates and data that we believe are reasonable and accurate but may be incorrect, incomplete or imprecise. Forward-looking statements are also subject to a number of business risks and uncertainties, any of which could cause actual results to differ materially from those set forth in or implied by the forward-looking statements. The risks and uncertainties include, among others, changes in the retail demand for apparel products, the cost of raw materials, competitive conditions in the apparel and textile industries, the relative strength of the United States dollar as against other currencies, changes in United States trade regulations, the discovery of unknown conditions (such as with respect to environmental matters and similar items) and other risks described from time to time in our reports filed with the Securities and Exchange Commission. Accordingly, any forward-looking statements do not purport to be predictions of future events or circumstances and may not be realized. We do not undertake publicly to update or revise the forward-looking statements even if it becomes clear that any projected results will not be realized. SELECTED FINANCIAL DATA: (In thousands, except per share amounts) Three Months Ended Oct. 2, Sept. 27, 2004 2003 ---------- ---------- Net Sales $ 54,300 30,802 Cost of Goods Sold 42,723 26,720 ---------- ---------- Gross Margin 11,577 4,082 SG&A 8,446 3,059 Other Income (10) (81) ---------- ---------- Operating Income 3,141 1,104 Interest Expense 703 154 Taxes 994 361 ---------- ---------- Net Income $ 1,444 $ 589 ========== ========== Weighted Average Shares Outstanding Basic 4,141 4,044 Diluted 4,268 4,168 Net Income per Common Share Basic $ 0.35 $ 0.15 Diluted $ 0.34 $ 0.14 Oct. 2, July 3, Sept. 27, 2004 2004 2003 --------- --------- -------- Current Assets Cash $ 208 $ 333 $ 189 Receivables, Net 29,397 38,610 17,370 Income Tax Receivable - - 416 Inventories 105,901 105,888 50,210 Deferred Income Taxes 1,269 1,075 505 Other Assets 1,328 1,616 1,484 --------- --------- -------- Total Current Assets 138,103 147,522 70,174 Noncurrent Assets Property, Plant & Equipment, Net 20,626 19,529 21,461 Deferred Income Taxes 252 178 - Other Noncurrent Assets 2,225 2,150 39 --------- --------- -------- Total Noncurrent Assets 23,103 21,857 21,500 --------- --------- -------- Total Assets $161,206 $ 169,379 $91,674 ========= ========= ======== Current Liabilities Accounts Payable and Accrued Expenses $ 27,201 $ 30,511 $17,112 Current Portion of Long Term Debt 15,497 20,810 2,000 Income Tax Payable 584 1,793 - --------- --------- -------- Total Current Liabilities 43,282 53,114 19,112 Noncurrent Liabilities Long-Term Debt 29,627 29,246 3,321 Deferred Income Taxes - - 1,224 Other Noncurrent Liabilities 11,557 11,527 1,567 --------- --------- -------- Total Noncurrent Liabilities 41,184 40,773 6,112 Stockholders' Equity 76,740 75,492 66,450 --------- --------- -------- Total Liabilities and Stockholders' Equity $161,206 $ 169,379 $91,674 ========= ========= ======== CONTACT: Delta Apparel, Inc., Duluth Herb Mueller, 678/775-6900 -----END PRIVACY-ENHANCED MESSAGE-----