• Full year net sales, adjusted diluted EPS¹ and free cash flow¹ in line with Company guidance
• Net sales of $658.7 million in the quarter, after reflecting impact of a $19 million sales return allowance
• Q4 2019 GAAP diluted EPS of $0.16, adjusted diluted EPS of $0.41
• GAAP charges of $55 million related to Back to Basics strategy
• Strong free cash flow of $241 million in Q4 drives full year free cash flow of $227 million
• Guidance for 2020 calls for sales growth of 2%-4%, GAAP diluted EPS of $1.70-$1.80 and adjusted diluted EPS of $1.85-$1.95
• Company announces 15% dividend increase and renewal of normal course issuer bid to repurchase up to 5% of its outstanding shares

Montreal, Thursday, February 20, 2020 - Gildan Activewear Inc. (GIL: TSX and NYSE) today announced results for the fourth quarter and year ended December 29, 2019, and initiated guidance for 2020.

Overall for 2019, we were pleased with the progress we made on our “Back to Basics” strategy intended to simplify our product portfolio and reduce complexity in manufacturing and distribution as we continue to enhance our competitive positioning. Net sales and adjusted diluted EPS in the fourth quarter unfolded largely in line with our expectations when we reported our third quarter results, before recognizing the impact of a sales returns allowance. In imprintables we saw continued point of sales (POS) softness, and distributor inventory de-stocking, while on the retail side, total market demand was weaker than expected, particularly for hosiery, but we still delivered strong double-digit underwear sales growth. Overall, we reported net sales of $659 million in the quarter, net of a $19 million sales return allowance for discontinued stock-keeping units (SKUs). For the full year, we generated sales of $2,824 million, down 2.9% over 2018 and in line with our guidance of a low-single-digit sales decline.

At the end of the quarter, we decided to significantly reduce our imprintables product line SKU base, by exiting all ship to-the-piece activities and discontinuing overlapping and less productive styles and SKUs between brands, an important initiative related to our Back to Basics strategy. Consequently, in connection with this initiative, we recorded GAAP charges of $55 million in the quarter consisting of inventory write-downs of approximately $48 million, and a net $7 million reversal of gross profit relating to anticipated product returns of discontinued SKUs which reduced sales by $19 million and cost of sales by $12 million.

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