By Josh Beckerman
Delta Apparel, a leading clothing manufacturer, reported a significant drop in its shares on Tuesday. The stock hit a 52-week low and has plummeted by 44%, now sitting at $3.79. The company cited ongoing unfavorable market dynamics as the reason for the poor performance in its fiscal first quarter.
Yesterday, the shares closed at $6.77 but opened today at $6.09. However, the stock later reached its lowest point of $2.70 in the morning trading session.
Delta Apparel revealed that its net sales for the quarter ended December 30 fell to $79.9 million, a considerable decline from $107.3 million in the previous year. This downturn was primarily driven by factors such as excess manufacturing capacity worldwide, which resulted in pricing pressure within its activewear division.
Furthermore, the company’s cash on hand and availability under its U.S. revolving credit facility amounted to $7.4 million as of December 30. This marked a decrease of $6.8 million from September. Aware of its financial position, Delta Apparel acknowledges the need to secure additional liquidity in the near future to sustain its operations and meet its obligations outlined in the U.S. revolving credit facility. As a result, the company is actively exploring various options to address this challenge.