Garment supplier Gildan Activewear has confirmed its continuing expectation of growth in 2023 despite an “uncertain” economic environment and a dip in first-quarter sales.

It has reported that net sales for the three months to 2 April were $703 million (£560 million), down $72 million (£57 million) and 9% year on year, in line with expectations. In activewear including blank garments, sales were down 12% to $588 million (£467.8 million).

The company said this reflected “anticipated headwinds tied to the current demand environment and to strong comparative periods in the first half of 2022”.

In the same period in 2022, activewear sales had benefited from distributor inventory replenishment after the Covid-19 pandemic as well as a tight manufacturing environment in 2021.

The company generated gross profit of $188 million (£150 million) in the quarter and adjusted gross profit of $184 million (£146.4 million), down $53 million (£42 million) and $55 million (£43.7 millioin) respectively over the previous year, driven by the decline in sales and lower gross margins.

President and CEO Glenn J Chamandy said: “We are pleased with our top-line results having met our sales expectations for the quarter. Moreover, even though the economic environment remains uncertain, we remain comfortable with our full-year outlook given our strong competitive position, which we are reinforcing with the Gildan Sustainable Growth (GSG) strategy, and POS trends across our business coming in line with our expectations during the first quarter.”

In its statement, the company said management continued “to believe we have the ability to drive top-line growth in 2023” and that “opportunity for growth remains once first-half headwinds abate.

“These headwinds include difficult comparative periods driven by post-pandemic inventory replenishment in 2022 and the impact of peak raw material and higher input costs in our inventories flowing through cost of sales in the first half of 2023.

“While the economic environment remains uncertain and we are seeing continued cautiousness on inventory levels with our customer base across channels, our POS [point of sale] trends were in line with our expectations for the first quarter.

“Accordingly, given this performance, and factoring in the expected roll-out of new incremental retail programmes and assuming continued POS recovery in international markets, we believe opportunity for growth remains once first-half headwinds abate.”

Its predictions for 2023 include full-year revenue growth in the low single-digit range and full-year adjusted operating margin landing within the company’s 18% to 20% annual target range.