07:33 AM EDT, 04/16/2024 (MT Newswires) -- RBC noted Gildan Activewear ( GIL ) held an Investor Update call coinciding with President & CEO Vince Tyra's first 90 days at the company.

RBC's Tom Callaghan notes there were no material shifts. Instead, he notes, Gildan will continue to build upon the previously detailed Gildan Sustainable Growth (GSG) strategy.

There was also no update on the work of the Special Committee that had been established to examine the 'non-binding expression of interest' and/or any other potential alternatives.

RBC noted Gildan highlighted five priorities at the call:

1. Execute on supply chain initiatives, including the ramp-up of Bangladesh Phase 1 ("on-track" to reach 75% capacity by year-end). Also optimizing manufacturing in the West to help maintain the company's low-cost advantage.

2. Gildan will seek to lift brand association with comfort/fit and quality.

3. Sees Some "select opportunity" to boost manufacturing flexibility to increase penetration in retail, where it has historically been "under-indexed".

4. While the US remains Gildan's most significant focus, there is opportunity to capture incremental share in some international markets, the company said. This should be supported by new manufacturing capacity in Bangladesh.

5. Empower and build strong talent and leadership internally.

Gildan highlighted medium-term (2025E-28E) financial targets which include: one, a mid-single digit revenue CAGR; and two, annual adjusted operating margins in the 18% to 21% range (the move on the upper end to 21% from 20% previously partly reflects expected SG&A credits as a result of Global Minimum Tax); and three, capital expenditures at 5% of sales; and four, annual adjusted EPS growth in the high-single to low double-digit range.

The company will continue to prioritize annual dividend growth and continued share repurchases "in the confines of leverage in the range of 1.5x - 2.0x Net Debt/EBITDA."

2024 guidance was reaffirmed. Gildan also announced preliminary Q1 2024 revenues of US$695 million, which is 2% above Street consensus of $680 million, and in-line with RBC. No further Q1 2024 financial details were announced.

Full first-quarter results are scheduled to be released on May 1.

Gildan is rated Outperform, with a US$41 target at RBC. Shares are up 2.5% in US premarket trade, to US$36.20.