Record Second Quarter Sales of $511.6 Million and Double-Digit Year-over-Year Growth in Profitability, Reflect Strong Business Momentum
Record Second Quarter Cash Flow from Operating Activities, Excluding IFRS 16, of $56.8 Million, Compared to $13.0 Million in the Same Period Last Year
Net Debt / EBITDA Improved to 0.7x from 0.9x at March 31, 2026 due to $29.3 million Debt Reduction
$8 Million Dividend Declared for the Second Quarter 2026
Company Reaffirms the 2026 Guidance
CAESAREA, Israel--(BUSINESS WIRE)--August 04, 2026--
Delta Galil Industries, Ltd. (DELG/Tel Aviv Stock Exchange), the global designer, manufacturer and marketer of branded and private label intimate, activewear, loungewear and denim apparel for ladies, men, and kids, today reported financial results for the second quarter ended June 30, 2026.
-- Sales increased 9% (5% in constant currency) to a second quarter record
of $511.6 million, compared to $470.1 million in the prior year period.
-- Gross profit, inclusive of tariff refunds, expanded 26% year-over-year
to a second quarter record of $253.2 million. Excluding tariff impact,
gross profit increased 17% compared to the second quarter last year.
-- EBIT excluding non-core items and inclusive of tariff refund, of $54.6
million, compared to $31.0 million in the prior year period. Excluding
tariff impact and non-core items EBIT increased 22% compared to the
second quarter last year.
-- Strong operating cash flow, excluding IFRS 16 and inclusive of a $33
million tariff refund, was $56.8 million, compared to $13 million in the
second quarter of 2025
-- During the second quarter of 2026, the Company received a cash refund
of $33 million related to prior U.S. tariffs and intends to re-invest a
portion of it into new strategic incremental growth initiatives,
including investments to expand the Company's manufacturing and supply
chain capabilities.
-- The impact of the IEEPA tariff refund on the second quarter of 2026
includes a $16.8 million increase to gross profit and EBIT, and a $13.2
million benefit to net income, or $0.50 per diluted share.
-- Strong balance sheet with $122.9 million in cash and record
shareholders' equity of $938.3 million at June 30, 2026.
-- Declares an $8 million dividend for the second quarter of 2026,
compared to $8 million for the second quarter last year.
Isaac Dabah, CEO of Delta Galil, stated, "We delivered an outstanding second quarter that meaningfully strengthened the momentum established in the first quarter and demonstrated broad-based progress across our business. Excluding the benefits of an IEEPA tariff refund, we achieved record second-quarter sales and an all-time record gross margin of 45.2%, as well as double-digit growth in all other profitability indicators. We expect to use a portion of the proceeds from the tariff refund to invest strategically in our manufacturing, supply chain and overall structure to support our future growth and profitability."
"Second quarter and year-to-date results demonstrate that our growth initiatives are translating into stronger revenue, expanding profitability and increased cash generation. While the tariff refund provided an additional benefit to our reported results and cash flow, the strength of our underlying performance reflects the continued execution of our strategy and the investments we have made in product innovation, owned brands, manufacturing flexibility, global sourcing, and distribution capabilities. With positive momentum across the business and net debt lower than a year ago, we believe Delta Galil is increasingly well positioned to deliver sustained profitable growth through the balance of 2026 and beyond," concluded Mr. Dabah.
Sales
Second quarter sales increased 9% to $511.6 million, compared to $470.1 million in the second quarter of 2025. Sales in constant currency increased 5%, compared to the second quarter last year. First half sales were $1,084.6 million, a 12% increase from $968.8 million in the prior-year period.
Gross Margin
Gross profit in the second quarter grew 26% to $253.2 million, compared to $201.3 million in the second quarter of 2025. Gross profit in the first half of 2026 was $491.9 million, compared to $403.9 million in the prior-year period.
Gross margin in the second quarter of 2026 increased by 670-basis points to 49.5%, compared to 42.8% in the second quarter of 2025. Gross margin in the first half of 2026 was 45.4%, compared to 41.7% in the first half of 2025.
Both second quarter and first half of 2026 gross profit included a $16.8 million benefit from the tariff refund. Excluding the tariff refund, gross margin in the second quarter and first half reached 45.2% and 43.4% of sales, respectively.
The year-over-year increase in gross margin was due primarily to continued improved efficiency of the Company's factories, positive exchange rates, higher proportion of Delta Israel activity from total sales which is characterized by higher gross margin than average and the benefit of the tariff refund.
EBIT
EBIT, excluding non-core items in the second quarter of 2026 increased 76% to $54.6 million, compared to $31.0 million in the prior year. EBIT in the second quarter of 2026 increased 70% to $52.7 million, compared to $31.0 million, in the second quarter last year.
The year-over-year increase in EBIT for the second quarter was primarily due to higher organic and non-organic sales, and continued improved efficiency of the Company's factories, partially offset by higher SG&A expenses mainly due to exchange rates and business expansion.
EBIT, excluding non-core items in the first half of 2026 increased 43% to $91.2 million, compared to $63.7 million, in the same period last year. EBIT in the first half of 2026 increased 38% to $87.8 million, compared to $63.7 million, in the same period last year.
Both second quarter and first half of 2026 EBIT included a $16.8 million benefit from tariff refund. Excluding tariff refund and non-core items, EBIT in the second quarter and first half increased by 22% and 17%, respectively.
Non-Core Items
For the second quarter and the first half of 2026 the Company recorded non-core expenses of $1.9 and $3.4 million, respectively, for changes in fair value of liability with respect to conditioned consideration. For the second quarter and first half of 2025, the Company recorded no non-core expenses.
Net Income
Net income excluding non-core items, net of tax, in the second quarter of 2026 increased 106% to $34.4 million, compared to $16.7 million in the same period last year. Net income in the second quarter of 2026 increased 96% to $32.8, compared to $16.7 million in the same period last year.
Net income excluding non-core items, net of tax, in the first half of 2026 increased 52% to $52.0, compared to $34.3 million in the same period last year. Net income in the first half of 2026 increased 43% to $49.2, compared to $34.3 million in the same period last year.
Both second quarter and first half of 2026 net income included a $13.1 million benefit from tariff refund. Excluding tariff refund and non-core items, net income in the second quarter and first half increased by 27% and 13%, respectively.
Diluted Earnings Per Share
Diluted earnings per share, excluding non-core items, net of tax, in the second quarter of 2026 was $1.21, compared to $0.57 in the same period last year. Diluted earnings per share in the second quarter of 2026 were $1.15, compared to $0.57 in the same period last year.
Diluted earnings per share, excluding non-core items, net of tax, in the first half of 2026 was $1.84, compared to $1.18 in the same period last year. Diluted earnings per share in the first half of 2026 was $1.73, compared to $1.18 in the same period last year.
Diluted earnings per share, excluding tariff refund and non-core items, net of tax, in the second quarter and first half of 2026 increased 25% and 14% to $0.71 and $1.34, respectively, compared to $0.57 and $1.18 in the same periods last year.
EBITDA, Cash Flow, Net Debt, Equity, and Dividend
EBITDA, excluding IFRS 16, was $62.7 million, compared to $39.1 million in the second quarter of 2025. In the first half of 2026, EBITDA excluding IFRS 16 impact was $107.5, compared to $79.6 million in the first half of 2025. EBITDA excluding IFRS 16 and tariff refund in the second quarter and the first half of 2026, increased by 17% and 14%, respectively and reached $45.9 million and $90.7 million.
Cash flow generated from operating activities, excluding IFRS 16, was $56.8 million, compared to $13.0 million in the second quarter of 2025. Cash flow generated from operating activities, excluding IFRS 16, was $84.7 million in the first half of 2026, compared to $17.1 million in the first half of 2025. The year-over-year increase in operating cash flow was primarily due to improved profitability, a $33 million tariff refund, and reduced working capital, mainly associated with changes in accounts receivables and inventory.
Net Debt to EBITDA, excluding IFRS 16, as of June 30, 2026, was 0.7x, compared to 0.9x at June 30, 2025.
Equity on June 30, 2026, was a record $938.3 million, compared to $852.0 million on June 30, 2025.
Delta Galil declared a dividend of $8 million, or $0305 per share, which will be distributed on August 19, 2026, with a record and "ex-dividend" date of August 12, 2026.
2026 Financial Guidance
The Company reaffirmed its 2026 guidance, which excludes non-core items and tariff refund, and is based on 1.15 US $ per 1 Euro, 3.00 NIS per 1 US $ and current tax and duty rates:
Full Year 2026 Guidance Full Year 2025 Results (in
(in millions, except per millions, except per share
share amount) amount)
-------------------------- ---------------------------
Sales $2,294 -- 2,328 $2,118.9
EBIT $204 -- 212 $174.2
EBITDA $324 -- 332 $282.8
Net income $123 -- 116 $102.6
Diluted EPS ($) $4.23 -- 4.00 $3.55
Constant Currency - Excluding the Impact of Foreign Currency
This release refers to "reported" amounts in accordance with IFRS accounting principles ("GAAP"), which include translation and transactional impacts from foreign currency exchange rates. The release also refers to "constant dollar" amounts, which exclude the impact of translating foreign currencies into U.S. dollars, and are considered a non-GAAP financial measure. These constant currency performance measures should be viewed in addition to, and not in lieu of, or superior to, Delta Galil's operating performance measures calculated in accordance with GAAP.
About Delta Galil Industries
Delta Galil is an innovative, global company engaged in the design, development, production and marketing of intimate apparel and activewear. The Company offers products in a wide range of categories -- Ladies intimates, men's underwear, loungewear, activewear, sleepwear, shapewear and socks. The Company's main markets are the U.S., Europe and Israel.
Delta Galil's leading customers include Nike, Victoria's Secret, Lululemon, Skims, Walmart and others. In addition, the Company owns a wide portfolio of owned brands such as Delta, Schiesser, Eminence, Athena, Splendid PJ Salvage and under license agreements for leading brands such as adidas, Columbia, Calvin Klein, Tommy Hilfiger and others. The Company also designs, develops, markets and sells denim under the Seven for All Mankind brand.
Delta Galil has a vertically integrated and global production and distribution platform that includes the entire value chain, from the design stage to the delivery of the final product, which allows for operational flexibility, high efficiency and rapid response to market changes.
The Company's CEO and controlling shareholder is Mr. Isaac Dabah, who has extensive, global experience in the fashion and apparel sector.
Safe Harbor Statement
Matters discussed in this press release contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words "anticipate," "believe," "estimate," "may" "intend," "expect" and similar expressions identify such forward-looking statements. Actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained herein, and while expected, there is no guarantee that we will attain the aforementioned anticipated developmental milestones. These forward-looking statements are based largely on the expectations of the Company and are subject to a number of risks and uncertainties. These include, but are not limited to, risks and uncertainties associated with: the impact of economic, tax rates in the various countries the Company operates in, competitive and other factors affecting the Company and its operations, markets, product, and distributor performance, the impact on the national and local economies resulting from terrorist actions, and U.S. actions subsequently; and other factors detailed in reports filed by the Company.
Source: Delta Galil Industries, Ltd.
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Balance Sheets
As of June 30, 2026
June 30 December 31
-------------------- -----------
2026 205 2025
--------- --------- -----------
(Unaudited) (Audited)
-------------------- -----------
Thousands of Dollars
---------------------------------
Assets
Current assets:
Cash and cash equivalents 121,532 88,692 133,973
Restricted Cash 1,418 1,501 1,802
Trade receivables 187,712 191,776 223,418
Income taxes receivable 7,018 1,080 2,569
Other accounts receivable 60,343 59,196 64,229
Financial derivative 2,288 505 1,390
Inventory 458,076 491,803 430,348
Assets held for sale 2,997 4,770 2,997
--------- --------- -----------
Total current assets 841,384 839,323 860,726
--------- --------- -----------
Non-current assets:
Investments accounted for using
the equity method and long-term
receivables 16,369 12,827 13,150
Investment property 2,375 2,640 2,513
Property, plant and equipment,
net, including assets under
construction 368,073 335,502 356,365
Goodwill 187,719 142,494 188,877
Brand names 155,465 138,730 157,704
Intangible assets, net of
accumulated amortization 189,838 163,069 165,186
Right of use assets 356,494 292,170 294,733
Deferred tax assets 36,755 35,637 36,562
Financial derivative 5,002 1,956 3,202
--------- --------- -----------
Total non-current assets 1,318,090 1,125,025 1,218,292
--------- --------- -----------
Total assets 2,159,474 1,964,348 2,079,018
========= ========= ===========
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Balance Sheets
As of June 30, 2026
June 30 December 31
---------------------- -------------
2026 2025 2025
---------- ---------- -------------
(Unaudited) (Audited)
---------------------- -------------
Thousands of Dollars
-------------------------------------
Liabilities and Equity
Current liabilities:
Short-term bank loans 68,759 39,711 96,437
Current maturities of
long term bank loans 25,474 22,325 23,759
Current maturities of
bonds 33,471 31,289 31,625
Financial derivative - 228 -
Current maturities of
leases liabilities 79,649 68,730 72,690
Trade payables 204,631 213,580 188,055
Income taxes payable 16,299 14,993 21,146
Provision for realignment
plan 1,806 3,506 2,898
Others payables 206,877 197,520 207,634
--------- --------- ----------
Total current liabilities 636,966 591,882 644,244
--------- --------- ----------
Non-current liabilities:
Bank loans 128,762 118,140 141,455
Post-employment benefits
obligation, net 5,880 5,729 6,081
Lease Liability 310,684 249,916 253,299
Other non-current
liabilities 63,151 43,783 54,695
Bonds 39,947 67,661 38,274
Deferred taxes
liabilities 35,739 35,191 37,371
--------- --------- ----------
Total non-current liabilities 584,163 520,420 531,175
--------- --------- ----------
Total liabilities 1,221,129 1,112,302 1,175,419
========= ========= ==========
Equity:
Equity attributable to
company's shareholders:
Share capital 23,714 23,714 23,714
Share premium 123,228 123,720 123,184
Other capital reserves 58,859 47,997 56,352
Retained earnings 706,650 639,992 678,210
Treasury shares (7,802) (9,384) (8,848)
--------- --------- ----------
904,649 826,039 872,612
Non-controlling interests 33,696 26,007 30,987
--------- --------- ----------
Total equity 938,345 852,046 903,599
--------- --------- ----------
Total liabilities and equity 2,159,474 1,964,348 2,079,018
========= ========= ==========
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Statement of Income
For the six-month and three-month periods ending June 30, 2026
Six months ended Increase/ Three months Increase/
June 30 (Decrease) ended June 30 (Decrease)
------------------ ---------- ---------------- ----------
2026 2025 % 2026 2025 %
--------- ------- ---------- ------- ------- ----------
(Unaudited) (Unaudited)
------------------ ----------------
Thousands of Thousands of
Dollars Dollars
------------------ ----------------
Excluding
Excluding Earning Earning Per
Per Share data Share data
------------------ ----------------
Sales 1,084,609 968,794 12% 511,636 470,124 9%
Cost of sales 592,684 564,882 258,471 268,800
--------- ------- ------- -------
Gross profit 491,925 403,912 22% 253,165 201,324 26%
% of sales 45.4% 41.7% 49.5% 42.8%
Selling and
marketing
expenses 339,759 286,732 18% 169,187 144,386 17%
% of sales 31.3% 29.6% 33.1% 30.7%
General and
administrative
expenses 61,489 53,174 16% 29,663 25,126 18%
% of sales 5.7% 5.5% 5.8% 5.3%
Other income, net
and Share in
losses (profits)
of investees
accounted for
using the equity
method (570) 298 (326) 784
--------- ------- ------- -------
Operating income
excluding
non-core items 91,247 63,708 43% 54,641 31,028 76%
% of sales 8.4% 6.6% 10.7% 6.6%
Non-core items 3,436 - 1,957 -
--------- ------- ------- -------
Operating income 87,811 63,708 38% 52,684 31,028 70%
Financing
expenses, net 22,190 19,045 17% 9,115 9,448 (4%)
--------- ------- ------- -------
Income before tax
on income 65,621 44,663 47% 43,569 21,580 102%
Income taxes
expenses 16,461 10,324 59% 10,809 4,844 123%
--------- ------- ------- -------
Net income for
the period 49,160 34,339 43% 32,760 16,736 96%
========= ======= ======= =======
Net income for
the period
excluding
non-core items,
net of tax 52,029 34,339 52% 34,394 16,736 106%
========= ======= ======= =======
Attribution of
net earnings for
the period:
Attributed to
Company's
shareholders 45,579 31,271 30,185 15,052
Attributed to
non-controlling
interests 3,581 3,068 2,575 1,684
--------- ------- ------- -------
49,160 34,339 32,760 16,736
========= ======= ======= =======
Net diluted
earnings per
share attributed
to company's
shareholders 1.73 1.18 1.15 0.57
========= ======= ======= =======
Net diluted
earnings per
share, before
non-core items,
net of tax,
attributable to
Company's
shareholders 1.84 1.18 56% 1.21 0.57 112%
========= ======= ======= =======
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Cash Flow Reports
For the six-month and three-month periods ending June 30, 2026
Six months ended June Three months ended
30 June 30
----------------------- ----------------------
2026 2025 2026 2025
---------- ----------- ---------- ----------
(Unaudited) (Unaudited)
----------------------- ----------------------
Thousands of Dollars Thousands of Dollars
----------------------- ----------------------
Cash flows from
operating
activities:
Net income for
the period 49,160 34,339 32,760 16,736
Adjustments
required to
present cash
flows from
operating
activities 111,539 46,102 56,730 26,354
Interest paid in
cash (18,643) (15,758) (8,048) (6,797)
Interest received
in cash 1,999 841 1,364 402
Income taxes paid
in cash, net (26,411) (21,451) (9,447) (11,058)
---------- ----------- ---------- ----------
Net cash generated
from operating
activities 117,644 44,073 73,359 25,637
---------- ----------- ---------- ----------
Cash flows from
investment
activities:
Acquisition of
property, plant
including under
construction (22,836) (55,177) (10,259) (34,542)
Acquisition of
intangible
assets (14,305) (10,354) (7,185) (5,034)
Proceeds from
sale of
property, plant
and equipment 120 4,152 97 2,428
Others (2,801) (132) (2,442) 275
---------- ----------- ---------- ----------
Net cash used in
Investing
activities (39,822) (61,511) (19,789) (36,873)
---------- ----------- ---------- ----------
Cash flows from
financing
activities:
Dividend paid to
non-controlling
interests in
subsidiary (3,604) (2,514) (870) (835)
Payment of
long-term
payables in
connection with
acquisition of
property, plant
and equipment
under
construction (3,882) (2,412) (1,921) (1,209)
Principal
elements of
lease payments (32,901) (26,982) (16,526) (12,596)
Dividend paid (18,021) (18,020) (7,999) (7,997)
Receipt of
long-term bank
loans - 967 - -
Repayment of
long-term bank
loans (10,288) (9,664) (2,444) (2,230)
Short-term credit
from banking
corporations,
net (27,609) 36,877 (29,239) 27,414
Others 2,721 (255) 1,720 (23)
---------- ----------- ---------- ----------
Net cash generated
from (used in)
financing
activities (93,584) (22,003) (57,279) 2,524
---------- ----------- ---------- ----------
Net decrease in cash
and cash
equivalents (15,762) (39,441) (3,709) (8,712)
---------- ----------- ---------- ----------
Effects of exchange
rate changes on cash
and cash
equivalents 3,321 7,624 3,525 7,216
Balance of cash and
cash equivalents at
the beginning of the
period, net 133,973 120,509 121,716 90,188
---------- ----------- ---------- ----------
Balance of cash and
cash equivalents at
the end of the
Period, net 121,532 88,692 121,532 88,692
========== =========== ========== ==========
DELTA GALIL INDUSTRIES LTD.
Concise Consolidated Cash Flow Reports
For the six-month and three-month periods ending June 30, 2026
Three months ended June
Six months ended June 30 30
------------------------- ------------------------
2026 2025 2026 2025
----------- ------------ ----------- -----------
(Unaudited) (Unaudited)
------------------------- ------------------------
Thousands of Dollars Thousands of Dollars
------------------------- ------------------------
Reconciliations
required to
present cash
flows generated
by operating
activities:
Adjustments in
respect of:
Depreciation 17,861 16,848 8,844 8,585
Amortization 41,471 34,725 20,935 17,913
Interest in
respect of bonds
and loans 10,525 8,885 4,224 3,262
Interest received
in cash (1,999) (841) (1,364) (402)
Taxes on income
paid in cash,
net 26,411 21,451 9,447 11,058
Deferred taxes on
income, net (633) (6,941) (221) (5,240)
Interest expenses
recognized in
respect of lease
agreements 8,118 6,873 3,824 3,535
Retirement
benefit
obligation, net (103) (487) (77) 27
Change in
realignment plan
provision (1,092) (4,636) (643) (3,797)
Change in fair
value of
liability due to
contingent
consideration 3,436 - 1,957 -
Loss (Gain) from
disposal of
property, plant
and equipment (78) (1,505) (82) (1,028)
Share-based
payments
expenses 1,154 1,163 545 749
Share in profits
of investee
accounted for
using the equity
method 90 156 40 9
Others (2,388) 2,533 (290) 2,425
----------- ------------ ----------- -----------
102,773 78,224 47,139 37,096
----------- ------------ ----------- -----------
Changes to
operating assets
and
liabilities:
Decrease in trade
receivables 33,150 92,130 25,353 28,367
Decrease
(Increase) in
other
receivable (966) (1,418) 163 470
Increase
(decrease) in
trade payables 19,253 (40,928) (13,465) (34,324)
Increase
(decrease) in
other payables (16,201) (15,936) 11,747 7,887
Increase in
inventory (26,470) (65,970) (14,207) (13,142)
----------- ------------ ----------- -----------
8,766 (32,122) 9,591 (10,742)
----------- ------------ ----------- -----------
111,539 46,102 56,730 26,354
=========== ============ =========== ===========
View source version on businesswire.com: https://www.businesswire.com/news/home/20260804066119/en/
CONTACT: Nissim Douek
+972-54-5201178
Nissim@unik.co.il
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Berns Communications Group
+1-212-994-4660
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