• Q4 2018 GAAP diluted EPS of $0.29, up 16%, adjusted diluted EPS¹ of $0.43, up 39% over last year and in-line with Company guidance
• Net sales of $742.7 million, up 13.6% in the quarter driven by activewear growth of 22%
• Operating margin and adjusted operating margin¹ up 100 and 230 basis points, respectively, over prior year driven by 300 basis point improvement in SG&A as a percentage of sales
• Strong free cash flow¹ in Q4 drives full year free cash flow of $429 million
• Projected GAAP EPS and adjusted diluted EPS growth for 2019 of 17% and 10%, respectively, at midpoint of guidance, on projected sales growth in the mid-single-digit range
• Company announces seventh consecutive annual 20% increase in quarterly dividend
• Renewal of normal course issuer bid to repurchase up to 5% of issued and outstanding common shares

Montreal, Thursday, February 21, 2019 - Gildan Activewear Inc. (GIL: TSX and NYSE) today announced results for the fourth quarter and year ended December 30, 2018, and initiated guidance for 2019.

We ended 2018 on a strong finish, meeting our full year financial targets after successfully navigating through unanticipated weather impacts and supply chain disruptions during the year, and executing well on our organizational consolidation initiatives. Strong performance in the fourth quarter reflected an increase of 16% in GAAP diluted EPS, and an increase of 39% in adjusted diluted EPS, driven by sales growth of approximately 14% and a 230 basis point improvement in adjusted operating margin over the same quarter last year. On a full year basis, we reported GAAP diluted EPS of $1.66, up 3% over the prior year, and adjusted diluted EPS of $1.86, up 8% on sales growth of close to 6%, in-line with our latest guidance for adjusted diluted EPS of $1.85 to $1.87 and mid-single-digit sales growth.

We were pleased with the underlying factors supporting our financial performance for the year. Sales growth for 2018 was driven by gains in key focus areas, including continued growth in fashion basics, strong double digit growth in international and global lifestyle brands sales, new private label program wins, which shipped primarily in the fourth quarter, and the doubling of our e-commerce sales. Operationally, we made good progress on initiatives related to the organizational consolidation we announced at the beginning of the year. We were able to drive operational efficiencies across the organization and reduce our SG&A expenses, while driving top line growth. In the fourth quarter alone, SG&A expenses as a percentage of sales improved by 300 basis points, and for the full year, despite planned increases in distribution and e-commerce investments in the first half of the year, SG&A expenses as a percentage of sales improved 100 basis points over 2017. We generated strong free cash flow of $429 million for the year, exceeding our initial guidance for 2018. We also completed the buyback of 12.6 million shares under our normal course issuer bid program. Combined with dividends, the Company returned more than $460 million to shareholders in 2018, and today, we announced the seventh consecutive 20% increase in the amount of our quarterly dividend and the renewal of our normal course issuer bid to repurchase up to 5% of our issued and outstanding common shares.

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