Gildan’s licensing agreement with Mossy Oak for opening price point socks is ending as retailers replace them with private label brands, Gildan CEO Glenn Chamandy said in releasing Q4 earnings.

The Mossy Oak socks, which were part of an agreement signed in 2015, largely have been sold through Walmart and Dollar General along with Gildan’s own brand.

Gildan’s hosiery and underwear sales, which include Mossy Oak, declined 7.9% to $173 million in Q4 ended Dec. 30. And sales are expected to fall $40 million this year as the company leaves the low-end sock business, Chamandy said. Gildan is continuing with higher priced licensed Under Armour socks.

Gildan sold $100 million worth of American Apparel t-shirts, hoodies, sweatshirts and other products in 2018, the first full year since it acquired the brand. It expanded distribution of the brand to 225 countries, including a major push in Europe.

Net income in the quarter increased 8.6% to $59.6 million, despite a $21.7 million restructuring charge. Q4 net sales rose 13.6% to $742.7 million as activewear revenue increased 22.3% to $569 million.

Contact:

Gildan, Rhodri Harries, CFO, 514-735-2023