Supplier Delta Apparel, Inc. (PPAI 188431), headquartered in Greenville, South Carolina, reported net sales and gross profits up for the fourth quarter and full fiscal year 2018 that ended September 29.

To better reflect its operating model, the company has re-aligned its reporting segments and now refers to them as the Delta Group and the Salt Life Group. The Delta Group is comprised of the DTG2Go digital print business as well as its Delta Activewear business and Soffe brand. The Salt Life Group is comprised of the Salt Life and Coast lifestyle brands.

The company announced net sales of $92.9 million in fourth quarter 2018, up two percent from $91.3 million during the same quarter in 2017. It attributed the sales increase to its Delta Group, which posted a revenue increase of four percent, while the Salt Life Group partly offset this increase with lower sales. The company’s gross profit was $19.2 million, up 15 percent from $16.7 million during the same period last year. Net income was $3.1 million for the quarter, up $1 million from last year.

“We are pleased to have delivered fourth quarter sales growth of two percent along with solid bottom line performance, despite significant weather interruptions at two of our major distribution centers,” says Robert W. Humphreys, Delta Apparel, Inc.’s chairman and CEO. “Our DTG2Go digital print business and our activewear business drove strong top- and bottom-line performance in our re-aligned Delta Group segment. While our Salt Life business was impacted by the hurricanes this quarter, the Salt Life brand continues to grow its lifestyle presence and expand its market reach. We remain extremely optimistic about that business going forward.”

For fiscal year 2018, net sales at the company were $395.5 million, up three percent from $385.1 million in fiscal year 2017. Once $15.6 million of sales in the prior fiscal year from the Junkfood Clothing business, which was sold in March 2017, are excluded, net sales increased seven percent compared to the prior year. Delta Group net sales were $356 million, an increase of nine percent from $326.6 million in fiscal year 2017. Salt Life Group net sales were $39.4 million compared to $58.5 million in the prior year, with the decline due to the since-divested Junkfood business and other strategic shifts in non-core business. Sales in the Salt Life brand were up 2.4 percent for the year, driven from the recent wins with national retailers and its direct-to-consumer business, partially offset by softness with independent retailers, which were hurt by the hurricanes a year ago and again this year.

The company’s gross profit was $82 million, up two percent from $80.7 million in fiscal year 2017. Net income was $1.3 million in fiscal year 2018 but, adjusted for the $10.7 million tax expense associated with the recent tax reform legislation, was $12 million, compared to $10.5 million in fiscal year 2017, which included the gain on the sale of the Junkfood.

“Fiscal 2018 was an important year for Delta Apparel,” says Humphreys. “We grew our sales year-over-year and, excluding the impacts of the recent tax reform legislation, significantly increased our profitability. We also made important strides in building our DTG2Go business with an acquisition in March and a follow-on acquisition in October, solidifying our industry-leading position in the digital print and fulfillment space. Finally, we continued to increase consumer awareness of our Salt Life brand through our expansion into additional product categories, and growth with national and regional retailers and in our own direct-to-consumer channels. We believe that the strategic actions we have taken over the past year position us well to capitalize on the many growth opportunities we see ahead for our company.”