Delta Galil Reports Record Sales and 23% Operating Profit Surge
Translated & summarized from Ice by baba
Delta Galil reported record third-quarter sales of $599.6 million and a 23% surge in operating profit to $63.1 million. The company's direct-to-consumer sales expansion and improved gross margins were key drivers. For the first nine months of 2026, sales increased 12% to $1.68 billion, with operating profit up 34%. Delta Galil expects its full-year results to be at the high end of its forecast and declared a dividend of $0.381 per share.
The story in 6 lines · by baba
- Delta Galil reported record Q3 sales of $599.6 million, an 11% increase year-over-year.
- Adjusted operating profit for the quarter jumped 23% to $63.1 million.
- Direct-to-consumer sales, a key growth driver, increased by 16% in the third quarter.
- For the first nine months of 2026, sales reached $1.68 billion, up 12%.
- Cash flow from operations surged approximately 170% to $114.1 million in the first nine months.
- The company expects full-year 2026 results at the upper end of its forecast range.
Delta Galil, controlled by CEO and controlling shareholder Isaac Dabah, has announced record third-quarter sales of $599.6 million, an 11% increase year-over-year, amidst a competitive global fashion market. The company's profitability saw a significant jump, with adjusted operating profit soaring 23% to $63.1 million, nearly double the sales growth rate. Net profit also rose, with adjusted net profit up 23% to $40.2 million and accounting net profit increasing 17% to $36.6 million. Diluted earnings per share reached $1.32, up from $1.10 in the same period last year.
The company's stock has performed well, showing a 6.24% rise in the past week, a 15.78% increase over the last month, and a 12.65% return year-to-date, despite a 2% dip in the trading day prior to the results announcement.
A key growth driver for Delta Galil is the expansion of direct-to-consumer sales, which grew 16% in the quarter, including its Daily Drills brand. This strategy enhances the company's own brand sales and improves gross profitability, which increased 15% to $267.9 million, representing 44.7% of sales compared to 43.3% previously. The strengthening Israeli Shekel against the dollar also contributed, though partially offset by changes in sales mix and increased customer discounts.
For the first nine months of 2026, sales reached $1.68 billion, up 12%. Adjusted operating profit grew 34% to $154.3 million, and adjusted net profit rose 37% to $92.2 million. Cash flow from operations, excluding IFRS 16, surged approximately 170% to $114.1 million, driven by improved profitability, reduced working capital, and a tax refund in the U.S. The company benefited from an $18.6 million tax refund during this period, contributing $14.5 million to net profit. Even without this one-time item, net profit grew 16% year-to-date.
Delta Galil anticipates its full-year 2026 results will be at the upper end of its previously issued forecast range. The company also declared a dividend of $0.381 per share, totaling approximately $10 million, payable on December 1. CEO Isaac Dabah expressed confidence in achieving long-term growth and a record year, with a focus on continued profitable expansion.
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