Delta reached $1 billion in annual sales for the fiscal year ending June 30, 2014. In Q2 2014, Delta saw record sales of $249.2 million, up 6% from Q2 2013, as well as record net profit and earnings per share, which were up 11% and 9% respectively from the previous year. Operating income for the quarter increased 11% to $15.5 million compared to $14 million in Q2 2013.
3. RESULTS OVERVIEW | Q2 2014
3
6%
11%
9%
9%
Sales UP 6% to $249.2M
19th
Consecutive Quarters of Organic Sales Growth
Operating Income
Increased 11% to
$15.5M comp. to $14.0M
EBITDA UP 9% to $19.9M
Diluted EPS went UP
by 9%
Q2 RECORD SALES, NET PROFIT & EPS
Q2 2014 Q2 2013
% Change
vs LY
Sales 249.2 234.4 6%
Operating Profit
% from Sales
15.5
6.2%
14.0
6.0%
11%
EBITDA
% from sales
19.9
8.0%
18.3
7.8%
9%
Net income attributed to
company's shareholders
9.7
3.9%
8.8
3.8%
11%
Diluted EPS ($ per share) 0.38 0.35 9%
Operating Cash flow 10.2 18.0
Operating Cash flow -
Last 4 Quarters ($ Millions)
45.1 42.2
($ Million)
4. RESULTS OVERVIEW | Q2 2014
4
6%
19%
14%
20%
Sales UP 6% to $487.2M
Operating Income
Increased 19% to
$30.4M comp. to $25.5M
EBITDA UP 14% to $38.9M
Diluted EPS went UP
by 20%
H1 RECORD SALES, NET PROFIT & EPS
YTD 2014 YTD 2013
% Change
vs LY
Sales 487.2 461.6 6%
Operating Profit
% from Sales
30.4
6.2%
25.5
5.5%
19%
EBITDA
% from sales
38.9
8.0%
34.0
7.4%
14%
Net income attributed to
company's shareholders
18.5
3.8%
15.4
3.0%
20%
Diluted EPS ($ per share) 0.73 0.61 20%
Operating Cash flow 3.6 4.7
Operating Cash flow -
Last 4 Quarters ($ Millions)
45.1 42.2
($ Million)
5. RESULTS OVERVIEW | Q2 2014
5
STRONG BALANCE SHEET
$336M
15.3%
46.5%
$117M
Increase in Equity
to $336.3M
Net Debt/CAP Ratio down
to 15.3% from 23.0%
Equity from total
balance sheet ratio
Cash on hand
June 30
2014
%
from total
June 30
2013
%
from total
Cash and cash equivalents 116.8 16% 34.8 6%
Restricted cash 0.5 0% 1.8 0%
Trade receivables 121.7 17% 117.4 20%
Inventories 188.8 26% 159.9 28%
Assets held for sale 1.0 0% 1.0 0%
Others 19.0 3% 26.4 5%
Total current assets 447.8 62% 341.3 59%
Fixed assets,net of
accumulated depreciation 100.0 14% 95.5 17%
Intangible assets, net of
accumulated depreciation
and other long term assets
175.8 24% 141.5 24%
Total Assets 723.6 100% 578.3 100%
Short-term bank loans 6.6 1% 39.2 7%
Current maturities of Debentures 18.7 3% 16.5 3%
Trade payables and others 142.9 20% 130.4 22%
Total current liabilities 168.2 24% 186.1 32%
Debentures 191.9 26% 81.9 14%
Others non-current liabilities 27.2 4% 19.5 4%
Total long term liabilities 219.1 30% 101.4 18%
Equity 336.3 46% 290.8 50%
Total Liabilities and equity 723.6 100% 578.3 100%
($ Million)
6. RESULTS OVERVIEW | Q2 2014
6
IMPROVED FINANCIAL INDICATORS
30.06.2014 30.06.2013
Current ratio 2.66 1.83
Quick ratio 1.54 0.98
Days of Sales Outstanding 44 45
Days Payable Outstanding 43 40
Inventory Days 99 87
Operating cash flow - Q2 ($ million) 10.2 18.0
Operating cash flow - H1 ($ million) 3.6 4.7
Operating cash flow - Last 4 Quarters ($ million) 45.1 42.2
EBITDA - Q2 ($ million) 19.9 18.3
EBITDA - H1 ($ million) 38.9 34.0
EBITDA - Last 4 Quarters ($ million) 91.0 77.9
Net financial debt ($ million) 82.4 99.1
Net financial debt to EBITDA ratio (based on Last 4 Quarters) 0.9 1.3
Equity / Equity & Liabilities 46.5% 50.3%
Equity ($ million) 336.3 290.8
Net Debt / CAP 15.3% 23.0%
($ Million)
7. RESULTS OVERVIEW | Q2 2014
7
RESULTS ON A QUARTERLY BASIS
Excluding one time items
2013 2014 Last 4
Quarters
Q1 Q2 Q3 Q4 Q1 Q2
Net Sales 227,255 234,368 257,199 255,897 238,074 249,152 1,000,322
EBIT before one time items 11,567 13,979 21,286 21,090 14,838 15,538 72,752
% 5.1% 6.0% 8.3% 8.2% 6.2% 6.2% 7.3%
EBITDA 15,759 18,288 25,235 26,889 19,026 19,863 91,013
% 6.9% 7.8% 9.8% 10.5% 8.0% 8.0% 9.1%
Net Income excluding one
time items 6,656 8,833 14,248 14,517 9,330 9,772 47,867
Permanent Cash Flow 10,411 11,196 21,334 20,552 12,117 13,294 67,297
Changes in Working Capital (23,684) 6,806 (1,959) 1,584 (18,731) (3,075) (22,181)
Operating Cash Flow (13,273) 18,002 19,375 22,136 (6,614) 10,219 45,116
($ Million)
WE REACHED $1 BILLION SALES IN THE YEAR ENDING JUNE 30TH
8. RESULTS OVERVIEW | Q2 2014
8
SALES ANALYSIS BY GEOGRAPHIC AREA
Q2 YTD
2014 % of
sales 2013 % of
sales
%
change 2014 % of
sales 2013 % of
sales
%
change
North America 141.1 57% 137.8 59% 2% 265.9 55% 265.6 58% -
Europe
(excluding Germany)
41.4 17% 42.4 18% (2%) 84.2 17% 77.9 17% 8%
Germany 33.6 13% 28.5 12% 14% 75.6 16% 68.3 15% 11%
Israel 31.0 12% 23.8 10% 30% 57.1 12% 47.1 10% 21%
Others 2.1 1% 1.9 1% 4.4 1% 2.7
Total 249.2 100% 234.4 100% 6% 487.2 100% 461.6 100% 6%
($ Million)
9. RESULTS OVERVIEW | Q2 2014
9
IMPROVED GROSS MARGIN
% From SalesGrowing our branded business
H1
2013
YEAR
2012
YEAR
2011
YEAR
2013
H1
2014
29.0%
30.8%
25.7%
23.7%
30.2%
10. RESULTS OVERVIEW | Q2 2014
10
Q2 SALES AND EBIT BY SEGMENT
Sales EBIT
Q2 2014 Q2 2013 % Chg. Q2 2014 Q2 2013
Delta USA
% from segment sales
117,339 104,004 13%
7,945
6.8%
8,087
7.8%
Global Upper Market
% from segment sales
63,609 72,625 (12%)
5,643
8.9%
*7,502*
10.3%
Schiesser
% from segment sales
41,500 35,221 18%
(149)
(0.0%)
(1,464)
(4.2%)
Delta Israel
% from segment sales
30,873 23,888 29%
2,267
7.3%
1,086
4.5%
Intersegment sales (4,169) (1,370)
Others (168) (1,232)
Total Sales and EBIT 249,152 234,368 6%
15,538
6.2%
13,979
6.0%
($ Million)
* Includes capital gain of $1.1 million from the sale of real estate. Q2 2013 EBIT excluding the capital gain was $6.4 million or 8.7% from sales.
11. RESULTS OVERVIEW | Q2 2014
11
YTD SALES AND EBIT BY SEGMENT
($ Million)
Sales EBIT
YTD 2014 YTD 2013 % Chg. YTD 2014 YTD 2013
Delta USA
% from segment sales
209,254 195,696 7%
11,851
5.7%
12,395
6.3%
Global Upper Market
% from segment sales
133,867 139,053 (4%)
11,381
8.5%
*11,419
8.2%
Schiesser
% from segment sales
94,293 83,256 13%
4,702
5.0%
1,992
2.4%
Delta Israel
% from segment sales
57,023 47,130 21%
1,857
3.3%
1,938
4.1%
Intersegment sales (7,211) (3,512)
Others **585 (2,198)
Total Sales and EBIT 487,226 461,623 6%
30,376
6.2%
25,546
5.5%
* Includes capital gain of $1.1 million from the sale of real estate. H1 2013 EBIT excluding the capital gain was $10.3 million or 7.4% from sales.
** Includes capital gain of $1.0 million from the sale of real estate
13. RESULTS OVERVIEW | Q2 2014
13
CAPITAL EXPENDITURES
Investing in our future growth ($ Million)
H1
2013
H1
20142012 2013
18.0
22.5
12.1
11.0
FIX – Acquisition of the Brand FIX
Joint Ventures - investment of
$5.0M in 3 new factories
Manufacturing 4.1
5.0
2.1
3.5
1.7
2.8
12.1
Capex
Others
Total
Israeli Market (Mainly in Retail Stores)
Schiesser (Mainly in Stores and Excluding
manufacturing)
Other investments
14. RESULTS OVERVIEW | Q2 2014
14
NET PROFIT & DILUTED EPS ATTRIBUTED
TO THE COMPANY SHAREHOLDERS
Q2 H1
2014 2013 % Chg. 2014 2013 % Chg.
Reported Diluted
EPS ($)*
0.38 0.35 9% 0.73 0.61 20%Q2
2013
H1
2013
Q2
2014
H1
2014
8.8
9.7
15.4
18.5
11%
20%
*Attributed to the company shareholders
($ Million)
15. RESULTS OVERVIEW | Q2 2014
15
DIVERSIFIED PORTFOLIO
% FROM SALES (first half of 2014)
Continue to Growth Organically
and through Acquisitions
Continue to grow our Branded
and Retail Businesses
Continue to grow Globally
Invest in Innovation
Growth in Activewear, Socks
and Seamless
Business Segments
Product Categories
Geographic Area
Branded / Private Label
Production*
Market Segment
DELTA USA
LADIES
NORTH AMERICA
PRIVATE LABEL
OUTSOURCING
UPPER MARKET MID TIER MASS MARKET
BRANDED
IN HOUSE
EUROPE ISRAEL
MENS SOCKS KIDS
43%
45%
55%
51%
74%
39% 30% 31%
49%
26%
33% 12%
23% 18% 14%
26% 19% 12%
GLOBAL UPPER
MARKET
SCHIESSER DELTA
ISRAEL
*Based on internal estimation