Document

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934


For the month of: November 2023						Commission File Number: 1-14830

GILDAN ACTIVEWEAR INC.

(Translation of Registrant’s name into English)

600 de Maisonneuve Boulevard West

(Address of Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:


Form 20-F o						Form 40-F þ

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	GILDAN ACTIVEWEAR INC.
Date: November 2, 2023	By:	/s/ Michelle Taylor
		Name:	Michelle Taylor
		Title:	Vice-President, General Counsel and Corporate Secretary


SEC 1815 (04-09)			Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.


			Contents
			MD&A
			1.0 Preface			2
			2.0 Caution regarding forward-looking statements			2
			3.0 Our business			4
			4.0 Strategy			8
			5.0 Operating results			9
			6.0 Financial condition			18
			7.0 Cash flows			20
			8.0 Liquidity and capital resources			22
			9.0 Legal proceedings			26

			10.0 Financial risk management			27
			11.0 Critical accounting estimates and judgments			27
			12.0 Accounting policies and new accounting standards not yet applied			27
			13.0 Internal control over financial reporting			29
			14.0 Risks and uncertainties			29
			15.0 Definition and reconciliation of non-GAAP financial measures			30

			Condensed interim consolidated financial statements			36

			Notes to the condensed interim consolidated financial statements			40


			MANAGEMENT'S DISCUSSION AND ANALYSIS

In this Management’s Discussion and Analysis (MD&A), “Gildan”, the “Company”, or the words “we”, “us”, and “our” refer, depending on the context, either to Gildan Activewear Inc. or to Gildan Activewear Inc. together with its subsidiaries.

This MD&A comments on our operations, financial performance, and financial condition as at and for the three and nine months ended October 1, 2023. All amounts in this MD&A are in U.S. dollars, unless otherwise noted. For a complete understanding of our business environment, trends, risks and uncertainties, and the effect of accounting estimates on our results of operations and financial condition, this MD&A should be read in conjunction with Gildan’s unaudited condensed interim consolidated financial statements as at and for the three and nine months ended October 1, 2023, and the related notes, and with our MD&A for the year ended January 1, 2023 (2022 Annual MD&A).

In preparing this MD&A, we have taken into account all information available to us up to November 1, 2023, the date of this MD&A. The unaudited condensed interim consolidated financial statements as at and for the three and nine months ended October 1, 2023 and this MD&A were reviewed by Gildan’s Audit and Finance Committee and were approved and authorized for issuance by our Board of Directors on November 1, 2023.

The unaudited condensed interim consolidated financial statements as at and for the three and nine months ended October 1, 2023 have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting, as issued by the International Accounting Standards Board (IASB). All financial information contained in this MD&A is consistent with International Financial Reporting Standards (IFRS), except for certain information discussed in the section entitled “Definition and reconciliation of non-GAAP financial measures” in this MD&A.

Additional information about Gildan, including our 2022 Annual Information Form, is available on our website at www.gildancorp.com, on the SEDAR website at www.sedar.com, and on the EDGAR section of the U.S. Securities and Exchange Commission website (which includes the Annual Report on Form 40-F) at www.sec.gov.

2.0 CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Certain statements included in this MD&A constitute “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities legislation and regulations and are subject to important risks, uncertainties, and assumptions. This forward-looking information includes, amongst others, information with respect to our objectives and the strategies to achieve these objectives, including statements related to the Gildan's Sustainable Growth (GSG) strategy and Next Generation ESG strategy and ESG targets as well as information with respect to our beliefs, plans, expectations, anticipations, estimates, and intentions. In particular, information appearing under the headings “Our business”, “Strategy”, "Operating results", “Liquidity and capital resources - Long-term debt and net debt”, “Financial risk management”, and “Risk and uncertainties” contain forward looking statements. Forward-looking statements generally can be identified by the use of conditional or forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “project”, “assume”, “anticipate”, “plan”, “foresee”, “believe”, or “continue”, or the negatives of these terms or variations of them or similar terminology. We refer you to the Company’s filings with the Canadian securities regulatory authorities and the U.S. Securities and Exchange Commission, as well as the risks described under the “Financial risk management”, “Critical accounting estimates and judgments”, and “Risks and uncertainties” sections of this MD&A and of the 2022 Annual MD&A for a discussion of the various factors that may affect the Company’s future results. Material factors and assumptions that were applied in drawing a conclusion or making a forecast or projection are also set out throughout this document and the 2022 Annual MD&A.

Forward-looking information is inherently uncertain and the results or events predicted in such forward-looking information may differ materially from actual results or events. Material factors, which could cause actual results or events to differ materially from a conclusion, forecast, or projection in such forward-looking information, include, but are not limited to:

•changes in general economic and financial conditions globally or in one or more of the markets we serve, including those resulting from the impact of the COVID-19 pandemic and the appearance of COVID variants;

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

•our ability to implement our growth strategies and plans, including our ability to bring projected capacity expansion online;

•our ability to successfully integrate acquisitions and realize expected benefits and synergies;

•the intensity of competitive activity and our ability to compete effectively;

•our reliance on a small number of significant customers;

•the fact that our customers do not commit to minimum quantity purchases;

•our ability to anticipate, identify, or react to changes in consumer preferences and trends;

•our ability to manage production and inventory levels effectively in relation to changes in customer demand;

•fluctuations and volatility in the price of raw materials used to manufacture our products, such as cotton, polyester fibres, dyes and other chemicals from current levels;

•our reliance on key suppliers and our ability to maintain an uninterrupted supply of raw materials, intermediate materials and finished goods;

•the impact of climate, political, social, and economic risks, natural disasters, epidemics, pandemics and endemics, such as the COVID-19 pandemic, in the countries in which we operate or sell to, or from which we source production;

•disruption to manufacturing and distribution activities due to such factors as operational issues, disruptions in transportation logistic functions, labour disruptions, political or social instability, weather-related events, natural disasters, epidemics and pandemics, such as the COVID-19 pandemic, and other unforeseen adverse events;

•compliance with applicable trade, competition, taxation, environmental, health and safety, product liability, employment, patent and trademark, corporate and securities, licensing and permits, data privacy, bankruptcy, anti-corruption, and other laws and regulations in the jurisdictions in which we operate;

•the imposition of trade remedies, or changes to duties and tariffs, international trade legislation, bilateral and multilateral trade agreements and trade preference programs that the Company is currently relying on in conducting its manufacturing operations or the application of safeguards thereunder;

•factors or circumstances that could increase our effective income tax rate, including the outcome of any tax audits or changes to applicable tax laws or treaties, including the implementation of a global minimum tax rate of 15%;

•changes to and failure to comply with consumer product safety laws and regulations;

•changes in our relationship with our employees or changes to domestic and foreign employment laws and regulations;

•negative publicity as a result of actual, alleged, or perceived violations of human rights, labour and environmental laws or international labour standards, or unethical labour or other business practices by the Company or one of its third-party contractors;

•changes in third-party licensing arrangements and licensed brands;

•our ability to protect our intellectual property rights;

•operational problems with our information systems as a result of system failures, viruses, security and cyber security breaches, disasters, and disruptions due to system upgrades or the integration of systems;

•an actual or perceived breach of data security;

•our reliance on key management and our ability to attract and/or retain key personnel;

•changes in accounting policies and estimates; and

•exposure to risks arising from financial instruments, including credit risk on trade accounts receivables and other financial instruments, liquidity risk, foreign currency risk, and interest rate risk, as well as risks arising from commodity prices.

These factors may cause the Company’s actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. Forward-looking statements do not take into account the effect that transactions or non-recurring or other special items announced or occurring after the statements are made may have on the Company’s business. For example, they do not include the effect of business dispositions, acquisitions, other business transactions, asset write-downs, asset impairment losses, or other charges announced or occurring after forward-looking statements are made. The financial impact of such transactions and non-recurring and other special items can be complex and necessarily depends on the facts particular to each of them.

There can be no assurance that the expectations represented by our forward-looking statements will prove to be correct. The purpose of the forward-looking statements is to provide the reader with a description of management’s expectations regarding the Company’s future financial performance and may not be appropriate for other purposes. Furthermore, unless otherwise stated, the forward-looking statements contained in this report are made as of the date hereof, and we do not undertake any obligation to update publicly or to revise any of the included forward-looking

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

statements, whether as a result of new information, future events, or otherwise unless required by applicable legislation or regulation. The forward-looking statements contained in this report are expressly qualified by this cautionary statement.

Gildan is a leading vertically integrated manufacturer of everyday basic apparel, including activewear, underwear, and hosiery products. Our products are sold to wholesale distributors, screenprinters and embellishers in North America, Europe, Asia-Pacific, and Latin America, as well as to retailers in North America, including mass merchants, department stores, national chains, specialty retailers, craft stores and online retailers. We also manufacture products for global lifestyle brand companies who market these products under their own brands through their own retail establishments, e-commerce platforms, and/or to third-party retailers.

Manufacturing and operating as a socially responsible producer is at the heart of what we do. The vast majority of our sales are derived from products we manufacture ourselves. Since the Company’s formation, we have made significant capital investments in developing and operating our own large-scale, vertically integrated manufacturing facilities, including yarn production, textile and sock manufacturing, as well as sewing operations, controlling all aspects of the production process from start to finish for the garments we produce.

We believe the skill set that we have developed in designing, constructing, and operating our own manufacturing facilities, the level of vertical integration of our supply chain and the capital investments that we have made over the years differentiate us from our competition who are not as vertically integrated and may rely more heavily on third-party suppliers. Owning and operating the vast majority of our manufacturing facilities allows us to exercise tighter control over our production processes, efficiency levels, costs and product quality, as well as to provide reliable service with short production/delivery cycle times. In addition, running our own operations allows us to achieve adherence to high standards for environmental and social responsibility practices employed throughout our supply chain.

3.2.1 Brands, Products and Customers

The products we manufacture and sell are marketed under Company brands, including Gildan®, American Apparel®, Comfort Colors®, Gildan® Hammer™, GoldToe® and Peds®. Further, we manufacture for and supply products to select leading global athletic and lifestyle brands, as well as to certain retail customers who market these products under their own exclusive brands. We also sell sock products under the Under Armour® brand through a sock licensing agreement, for exclusive distribution in the United States and Canada.

Our primary product categories include activewear tops and bottoms (activewear), socks (hosiery), and underwear tops and bottoms (underwear). In fiscal 2022, Activewear sales accounted for 85% of total net sales, and Hosiery and underwear sales accounted for 15% of total net sales.

We sell our activewear products primarily in “blank” or undecorated form, without imprints or embellishment. The majority of our Activewear sales are currently derived from activewear sold to wholesale distributors in the imprintables channels in North America and internationally. These wholesale distributors then sell the blank garments to screenprinters/embellishers who decorate the products with designs and logos, and who in turn sell the embellished/imprinted activewear into a highly diversified range of end-use markets. These include educational institutions, athletic dealers, event merchandisers, promotional product distributors, charitable organizations, entertainment promoters, travel and tourism venues, and retailers. The activewear products have diverse applications, such as serving as work or school uniforms or athletic team wear or simply conveying individual, group, and team identity. We also sell activewear products in blank form directly to various retailers, or through national accounts servicing retailers, in addition to underwear and socks for men, ladies, and kids. These retailers include mass merchants, department stores, national chains, sports specialty stores, craft stores, food and drug retailers, dollar stores, and price clubs, all of which sell to consumers through their brick and mortar outlets and/or their e-commerce platforms. Additionally, we sell to pure-play online retailers who sell to consumers. We also manufacture for and sell to select leading global athletic and lifestyle consumer brand companies who distribute these products

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

within the retail channel through their own retail establishments, e-commerce platforms, and/or through third-party retailers.

The following table summarizes our product offering under Company and licensed brands:


Primary product categories	Product-line details	Brands
Activewear	T-shirts, fleece tops and bottoms, and sport shirts	Gildan®, Gildan Performance®, Gildan® Hammer™, Comfort Colors®, American Apparel®
Hosiery	athletic, dress, casual and workwear socks, liner socks, and socks for therapeutic purposes(1)	Gildan®, Under Armour®(2), GoldToe®, PowerSox®, Signature Gold by GoldToe®, Peds®, MediPeds®, All Pro®, American Apparel®
Underwear	men's and boys' underwear (tops and bottoms) and ladies panties	Gildan®, Gildan Platinum®

(1) Applicable only to MediPeds®.

(2) Under license agreement for socks only - with exclusive distribution rights in the U.S. and Canada. License expires on March 31, 2024.

The vast majority of our products are manufactured in facilities that we own and operate. To a much lesser extent, we also use third-party contractors to supplement certain product requirements. Our vertically integrated operations range from start to finish of the garment production process and include capital-intensive yarn-spinning, textile and sock manufacturing facilities, as well as labour-intensive sewing facilities. Our manufacturing operations are situated in four main hubs, specifically in the United States, Central America, the Caribbean, and Bangladesh. All of our yarn-spinning operations are located in the United States, while textile, sewing, and sock manufacturing operations are situated in the other geographical hubs mentioned above, the largest of which is in Honduras in Central America.

In order to support further sales growth, continue to drive an efficient and competitive cost structure, and enhance geographic diversification in our supply chain, we are expanding manufacturing capacity with a significant expansion in Bangladesh that involves the development of a large multi-plant manufacturing complex expected to house two large textile facilities and related sewing operations. Construction of the first facility of the complex is in its final stages; including installation of the production equipment. Progressive ramp-up of operations is underway and will continue through the remainder of 2023 and in 2024.

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

The following table provides a summary of our primary manufacturing operations by geographic area:

United States

Central America

Caribbean

Asia

Yarn-spinning facilities(1):

conversion of cotton, polyester and other fibers into yarn

■ Salisbury, NC

(2 facilities)

■ Mocksville, NC

■ Eden, NC

■ Clarkton, NC

■ Sanford, NC

(2 facilities)

■ Mayodan, NC

Textile facilities: knitting yarn into fabric, dyeing and cutting fabric

■ Honduras
(4 facilities)

■ Dominican
Republic

■ Bangladesh (2 facilities)

Sewing facilities(2):

assembly and sewing of cut goods

■ Honduras
(2 facilities)
■ Nicaragua
(4 facilities)

■ Dominican
Republic
(3 facilities)

■ Bangladesh (2 facilities)

Garment-dyeing(3):

pigment dyeing or reactive dyeing process

■ Honduras

Hosiery manufacturing facilities:

conversion of yarn into finished socks

■ Honduras

(1) While the majority of our yarn requirements are internally produced, we also use third-party yarn-spinning suppliers, primarily in Asia for our Bangladesh operations, to satisfy the remainder of our yarn needs. One of the Salisbury facilities included here will be idled during the fourth quarter of 2023.

(2) Although the majority of our sewing facilities are Company-operated, we also use the services of third-party sewing contractors, in other regions in Central America and Haiti, to satisfy the remainder of our sewing requirements.

(3) Garment dyeing is a feature of our Comfort Colors® products only, which involves a different dyeing process than how we typically dye the majority of our products at our textile facilities. Our garment dyeing operations are located in our Rio Nance 3 facility in Honduras.

3.2.3 Environmental, Social and Governance (ESG) Program

ESG is core to Gildan’s long-term business strategy and has long-been a key element of our success. As one of the most vertically integrated manufacturers in the apparel industry, producing the vast majority of the products we sell in our owned and/or Company-operated facilities, we have the advantage of exercising direct control on how we operate and in driving our ESG practices consistently across our operations.

The Company's ESG program is overseen centrally and the execution of the program is managed by dedicated teams of skilled professionals located in the regions where we operate. Our Board of Directors’ Corporate Governance and Social Responsibility Committee, composed of independent directors, has the specific responsibility of overseeing Gildan’s policies and practices in areas relevant to the environment, labour and human rights, health and safety, and other sustainability issues, including community engagement and stakeholder relations.

Building on a strong foundation of best-in-class ESG practices, the Company is executing on its “Next Generation ESG” strategy, an enhanced framework designed to deliver meaningful advancements by 2030 in key areas related to Climate, Energy, and Water; Circularity; Human Capital Management; Long-Term Value Creation; and Transparency and Disclosure. Under this strategy, Gildan seeks to address global environmental and social priorities and increase the sustainability of products delivered to customers worldwide.

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

The Company's targets and objectives in the five key focus areas of its Next Generation ESG strategy are as follows:

•Climate, Energy, and Water

Gildan understands the importance of climate change, and over the last year, has been implementing its new climate strategy across the organization, with a goal of reducing its absolute Scope 1 and 2 greenhouse gas (GHG) emissions by 30% by 20301 and absolute Scope 3 GHG emissions by 13.5% by 20302. SBTi has validated that the corporate greenhouse gas emissions reduction targets submitted by Gildan are in conformance with the SBTi Criteria and Recommendations (version 4.2). The SBTi’s target validation team has classified Gildan’s Scope 1 and 2 target and has determined that it is in line with a well-below 2ºC trajectory. Gildan is also committed to addressing water related risks linked to climate change. The Company plans to further invest in water efficiency and implement additional water reducing, reusing, and recycling options in its operations with the goal to reduce water intensity (usage/withdrawal per kilogram produced) by 20% by 20303.

Gildan is committed to fostering a circular economy to reduce its environmental impact and intends to source more sustainable and transparent raw materials and enhance sustainable waste management initiatives. This will include sourcing 100% sustainable cotton4 by 2025 and 30% recycled polyester or alternative fibers and/or yarns by 2027. The Company also plans to achieve zero manufacturing waste sent to landfill by 2027 and to use 75% recycled or sustainable packaging and trim materials5 by 2027.

•Human Capital Management

The Company will continue ensuring human rights are respected in its supply chain. Gildan will also push health and safety performance to new standards by working to improve employee safety and reducing workplace risks across its operations. To achieve this, Gildan plans to attain the ISO 45001 certification at all its Company-owned and operated facilities by 2028.

On diversity, equity, and inclusion, the Company set a first-time goal to improve gender parity. While Gildan has already attained gender parity globally at the manager level and below, by 2027 it is targeting to achieve gender parity within the employee group encompassing director level and above.

•Long-Term Value Creation

Gildan is committed to positively impacting economic development in regions where the Company operates with meaningful community engagement. Gildan intends to incrementally increase allocation of capital towards purposeful and value-driven projects in regions where the Company operates and plans to gradually reach a contribution of 1% of its pre-tax earnings by 2026. In parallel, the Company will also engage one of its most important stakeholders, its people, and continue to facilitate and encourage employee volunteerism at all levels to further deepen local impact.

•Transparency and Disclosure

A key part of Gildan’s accountability in reaching these targets will be to transparently share the journey with stakeholders. To that effect, Gildan plans to further enhance and strengthen its ESG disclosure across all its areas of focus, effectively allowing stakeholders to make more informed ESG-focused decisions and maintaining a high degree of trust and understanding of Gildan.

Please visit www.GildanRespects.com for more information on our ESG program and a more detailed discussion of our accomplishments in ESG. Information on the Company's website does not form part of and is not incorporated by reference in this MD&A.

1 Compared to a 2018 base year. The target boundary includes land-related emissions and removals from bioenergy feedstocks.

2 Compared to a 2019 base year.

3 Compared to a 2018 base year.

4 Cotton sourced from third party verified programs that support environmental and/or social sustainability improvements and/or outcomes. Third party verified programs include verified U.S.-grown cotton (U.S. Cotton Trust Protocol), Better Cotton, organic cotton, recycled or regenerative cotton and fair-trade cotton.

5 Based on sustainable SKUs specific to apparel containing carton, polyester, paper, and poly-cotton trims and include 20% to 60% of recycled material and/or are certified by the Forest Stewardship Council or another relevant sustainability certification.

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

3.2.4 Sales, marketing and distribution

Our global sales and marketing office is located in Christ Church, Barbados, out of which we have established customer-related functions, including sales management, marketing, customer service, credit management, sales forecasting, production planning, inventory control and logistics, as well as finance, human resources and information technology functions. We also maintain sales support offices in the U.S. We have established extensive distribution operations primarily through internally managed and operated large distribution centres and some smaller facilities in the U.S., as well as a large distribution facility in Honduras. To supplement some of our distribution needs, we also use third-party warehouses in North America and Europe.

3.2.5 Employees and corporate office

We currently employ over 42,000 employees worldwide. Our corporate head office is located in Montreal, Canada.

3.3 Competitive environment

The basic apparel market for our products is highly competitive. Competition is generally based upon service and product availability, price, quality, comfort and fit, style, and brand. We compete on these factors by leveraging our competitive strengths, including our strategically located and vertically integrated manufacturing supply chain, scale, cost structure, global distribution, and our brand positioning in the markets we serve. We believe our manufacturing skill set, together with our large-scale, low-cost vertically integrated supply chain infrastructure that we have developed by investing significantly over time are key competitive strengths and differentiators from our competition.

We face competition from large and smaller U.S.-based and foreign manufacturers or suppliers of basic family apparel. Among the larger competing North American-based manufacturers are Hanesbrands Inc., as well as Fruit of the Loom, Inc., a subsidiary of Berkshire Hathaway Inc. which competes through its own brand offerings and those of its subsidiary, Russell Corporation. These companies manufacture out of some of the same geographies as Gildan and compete primarily within the same basic apparel product categories in similar channels of distribution in North America and international markets. In socks and underwear, our competitors also include Renfro Corporation, Jockey International, Inc., and Kayser Roth Corporation. In addition, we compete with smaller U.S.-based companies selling to or operating as wholesale distributors of imprintables activewear products, including Next Level Apparel, Color Image Apparel, Inc. (owner of the Bella + Canvas brand), and Delta Apparel Inc., as well as Central American and Mexican manufacturers that supply products in the imprintables channel. Finally, although we also compete with some of our customers' own private brand offerings, we also supply products to certain customers that are seeking strategic suppliers with our type of manufacturing capabilities to support their private brand offerings.

Building on a strong foundation, in 2022 the Company launched its “Gildan Sustainable Growth” (GSG) strategy focused on driving organic top and bottom-line growth through three key pillars – capacity expansion, innovation, and ESG. We believe that leveraging our competitive advantage as a low-cost, vertically integrated manufacturer and successfully executing on well-defined capacity expansion plans, delivering value-driven and innovative products, together with leading ESG practices, will position us well to drive strong revenue growth, profitability and effective asset utilization, all of which are expected to allow us to deliver long-term shareholder value creation.

The three pillars of our GSG strategy are:

Capacity-driven growth: Leveraging our strong competitive advantage as a low-cost vertically integrated manufacturer as we execute on well-defined plans to expand our global production capacity to support our long-term growth plans.

Through the acquisition of Frontier Yarns, we have strengthened our vertical integration by expanding our yarn-spinning capabilities. We are also in the process of consolidating and modernizing our overall U.S. yarn spinning operations. Additionally, the Company is executing on the first phase of development of a large vertically integrated textile and sewing complex in Bangladesh as described in more detail in subsection 3.2.2 entitled "Manufacturing" in this MD&A.

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

Innovation: Driving leadership in innovation across the organization and all areas of operations aimed at delivering high-quality, value-driven products, increased speed-to-market, operational efficiencies and a reduced environmental footprint.

The Company has identified and defined specific key initiatives, as well as investments aimed at driving innovation in our product-development and manufacturing processes, distribution and final products, including fabric features, product fit, fabric adaptability to evolving printing and decorating techniques, and ESG-friendly product attributes. Further investments will also be allocated to leverage digital tools, predictive analytics and artificial intelligence to better inform and accelerate decision-making across the organization, streamline systems and processes, and enhance planning, forecasting and market research.

ESG: Further increasing our ESG focus across all operations and leveraging our strong ESG standing and progress to enhance our value proposition to all our stakeholders.

We are implementing our Next Generation ESG strategy and making progress towards our long-term ESG targets, heightening ESG efforts across the organization. Initiatives under our strategy are aimed at reducing our carbon footprint, and water intensity (usage/withdrawal per kilogram produced), and fostering a circular economy, while driving increased operational efficiencies. Additional initiatives build on supporting economic development in regions where we operate and ensuring strong respect of human rights and high health and safety standards throughout our supply chain. Further, we will be increasing investment in our people, driving diversity and inclusion across our operations and enhancing ESG disclosure and transparency. All important areas of focus as we build on what is already a strong ESG proposition for all stakeholders.

Successfully executing on all of the above initiatives underpinning the three pillars of our strategy is expected to position the Company to generate long-term revenue growth, sustained profitability and effective asset utilization, all of which are expected to deliver long-term value to our shareholders.

5.0 OPERATING RESULTS

Overview and business environment

In 2022, activewear sold to wholesale distributors, servicing the imprintables industry, benefited from the continued post-pandemic recovery and the comeback of large gatherings, while activewear sold through our National account customers, servicing retail end-markets, were hampered by a softening demand environment and ongoing inventory adjustments at retailers. The softening demand environment also negatively impacted POS trends in the North American imprintables channel in the latter half of 2022. Our international markets continued to be impacted by difficult economic conditions in Europe and Asia, and the strict Covid policy prevailing in China until late 2022. In the first nine months of 2023, we were encouraged by normalizing inventory levels at retailers. We also saw year-over-year POS trends for the Activewear category improve sequentially through the first three quarters of 2023. This said, our net sales were down year-over-year as we faced strong 2022 comparative periods which had benefited from distributor inventory replenishment following the pandemic and a tight manufacturing environment in 2021. In addition, higher raw material costs have impacted our margins year to date although this abated as of the third quarter. While we are seeing softer demand trends in certain markets stemming from the macro environment, we continue to expect our revenues to grow in the fourth quarter supported by the planned roll-out of incremental retail programs and the easier comparative period.

More broadly, we continue to execute on our GSG strategy. With ongoing capacity investments in both yarn-spinning and textile operations, we increased our manufacturing flexibility which has allowed us to rebuild our inventories to healthier levels and strengthen our relationships with distributors by improving serviceability. We are executing on our capital allocation strategy, investing in capital projects, and returning capital to shareholders through dividends and active share repurchases, while maintaining a healthy financial position. We believe we are well positioned to drive growth under the "Gildan Sustainable Growth" strategy, described in section 4 of this MD&A. For a complete understanding of our business environment, trends, risks and uncertainties, and the effect of accounting estimates on our results of operations and financial condition, this MD&A should be read in conjunction with Gildan’s unaudited condensed interim consolidated financial statements as at and for the three and nine months ended October 1, 2023, and the related notes, and with our MD&A for the year ended January 1, 2023 (2022 Annual MD&A).

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			MANAGEMENT'S DISCUSSION AND ANALYSIS

In the Company’s news release dated November 2, 2023, filed with the SEC on EDGAR and with the Canadian securities regulators on SEDAR+ at www.sedarplus.com, the full-year outlook for 2023 has been updated.

5.1 Non-GAAP financial measures

We use non-GAAP financial measures and ratios to assess our operating performance and liquidity. Securities regulations require that companies caution readers that earnings and other measures adjusted to a basis other than IFRS do not have standardized meanings and are unlikely to be comparable to similar measures used by other companies. Accordingly, they should not be considered in isolation. In this MD&A, we use non-GAAP financial measures and ratios including adjusted net earnings, adjusted diluted EPS, adjusted gross profit, adjusted gross margin, adjusted operating income, adjusted operating margin, and adjusted EBITDA to measure our performance and financial condition from one period to the next, which excludes the variation caused by certain adjustments that could potentially distort the analysis of trends in our operating performance, and because we believe such measures provide meaningful information to investors on the Company’s financial performance and financial condition. We also use other non-GAAP financial measures including free cash flow, total debt, net debt, net debt leverage ratio and working capital.

We refer the reader to section 15.0 entitled “Definition and reconciliation of non-GAAP financial measures” in this MD&A for the definition and complete reconciliation of all non-GAAP measures used and presented by the Company to the most directly comparable IFRS measures.

5.2 Summary of quarterly results

The table below sets forth certain summarized unaudited quarterly financial data for the eight most recently completed quarters. This quarterly information is unaudited and has been prepared in accordance with IFRS. The operating results for any quarter are not necessarily indicative of the results to be expected for any future period.


For the three months ended (in $ millions, except share and per share amounts or otherwise indicated)	Q3 2023	Q2 2023	Q1 2023	Q4 2022	Q3 2022	Q2 2022	Q1 2022	Q4 2021

Net sales	869.9	840.4	702.9	720.0	850.0	895.6	774.9	784.3
Net earnings	127.4	155.3	97.6	83.9	153.0	158.2	146.4	173.9
Net earnings per share:
Basic(1)	0.73	0.87	0.54	0.47	0.84	0.85	0.77	0.90
Diluted(1)	0.73	0.87	0.54	0.47	0.84	0.85	0.77	0.89
Weighted average number of shares outstanding (in ‘000s):
Basic	175,087	177,624	179,543	179,680	181,980	185,506	189,344	193,841
Diluted	175,348	177,902	179,843	179,897	182,239	185,869	190,214	194,760

(1) Quarterly EPS may not add to year-to-date EPS due to rounding.

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

5.2.1 Seasonality and other factors affecting the variability of results and financial condition

Our results of operations for interim and annual periods are impacted by the variability of certain factors, including, but not limited to, changes in end-use demand and customer demand, our customers’ decision to increase or decrease their inventory levels, changes in our sales mix, and fluctuations in selling prices and raw material costs. While our products are sold on a year-round basis, our business experiences seasonal changes in demand which result in quarterly fluctuations in operating results. Although certain products have seasonal peak periods of demand, competitive dynamics may influence the timing of customer purchases causing seasonal trends to vary somewhat from year to year. Historically, demand for T-shirts is lowest in the fourth quarter and highest in the second quarter of the year, when distributors purchase inventory for the peak summer selling season. Historically, demand for fleece is typically highest in advance of the fall and winter seasons, in the second and third quarters of the year. Sales of hosiery and underwear are typically higher during the second half of the year, during the back-to-school period and

QUARTERLY REPORT - Q3 2023 P.10


			MANAGEMENT'S DISCUSSION AND ANALYSIS

the Christmas holiday selling season. These seasonal sales trends of our business also result in fluctuations in our inventory levels throughout the year.

Our results are also impacted by fluctuations in the price of raw materials and other input costs. Cotton and polyester fibers are the primary raw materials used in the manufacture of our products, and we also use chemicals, dyestuffs, and trims, which we purchase from a variety of suppliers. Cotton prices are affected by consumer demand, global supply, which may be impacted by weather conditions in any given year, speculation on the commodities market, the relative valuations and fluctuations of the currencies of producer versus consumer countries, and other factors that are generally unpredictable. While we enter into purchase contracts and derivative financial instruments in advance of delivery to establish firm prices for the cotton component of our yarn requirements, our realized cotton costs can fluctuate significantly between interim and annual reporting periods. Energy costs in our results of operations are also affected by fluctuations in crude oil, natural gas, and petroleum prices, which can also influence transportation costs and the cost of related items used in our business, such as polyester fibers, chemicals, dyestuffs, and trims. Changes in raw material costs are initially reflected in the cost of inventory and only impact net earnings when the respective inventories are sold.

Business acquisitions may affect the comparability of results. In addition, management decisions to consolidate or reorganize operations, including the closure of facilities, may result in significant restructuring costs in an interim or annual period. Subsection 5.4.6 entitled “Restructuring and acquisition-related costs (recovery)” in this MD&A contains a discussion of costs related to the Company’s restructuring actions and business acquisitions. Share repurchases have reduced our number of shares outstanding and benefited our net earnings per share (EPS) over the past two years. The Company may repurchase more shares in the future as deemed appropriate, but this remains uncertain. The effect of asset write-downs or reversals, including allowances for expected credit losses, provisions for discontinued inventories, and impairments of long-lived assets can also affect the variability of our results. In the fourth quarter of fiscal 2022, we reported an impairment charge of $62 million relating to our Hosiery cash-generating unit (CGU), compared to a reversal of impairment of $32 million (net of specific asset write-offs) in the fourth quarter of fiscal 2021. Our results of operations over the past two years also include net insurance gains resulting from accrued insurance recoveries for the Company’s claims for losses relating to the two hurricanes in Central America in November 2020 (Q1 2022: $0.3 million; Q4 2022: $25.6 million, Q1 2023: $3.3 million and Q2 2023: $74 million). During the first quarter of 2023, the Company entered into an agreement to sell and leaseback one of its distribution centres located in the U.S. The disposal resulted in a pre-tax gain of $25.0 million ($15.5 million after tax). Refer to subsection 5.4.5 Gain on sale and leaseback and net insurance gains of this MD&A for a more detailed discussion.

Our reported amounts for net sales, cost of sales, SG&A expenses, and financial expenses/income are impacted by fluctuations in certain foreign currencies versus the U.S. dollar as described in the “Financial risk management” section of this MD&A. The Company periodically uses derivative financial instruments to manage risks related to fluctuations in foreign exchange rates.

QUARTERLY REPORT - Q3 2023 P.11


			MANAGEMENT'S DISCUSSION AND ANALYSIS

5.3 Selected financial information


(in $ millions, except per share amounts or otherwise indicated)	Three months ended							Nine months ended
	Oct 1, 2023		Oct 2, 2022		Variation			Oct 1, 2023		Oct 2, 2022		Variation
					$	%						$	%

Net sales	869.9		850.0		19.9	2.3	%	2,413.2		2,520.5		(107.3)	(4.3)	%
Gross profit	239.2		252.2		(13.0)	(5.2)	%	643.5		757.6		(114.1)	(15.1)	%
Adjusted gross profit(1)	239.2		252.2		(13.0)	(5.2)	%	640.4		756.3		(115.9)	(15.3)	%
SG&A expenses(5)	82.2		82.2		—	n.m.		242.1		252.7		(10.6)	(4.2)	%
Gain on sale and leaseback	—		—		—	n.m.		(25.0)		—		(25.0)	n.m.
Net insurance gains	—		—		—	n.m.		(74.2)		—		(74.2)	n.m.
Restructuring and acquisition-related costs (recovery)	2.0		(4.6)		6.6	n.m.		34.9		(5.8)		40.7	n.m.

Operating income	155.0		174.6		(19.6)	(11.2)	%	465.7		510.8		(45.1)	(8.8)	%
Adjusted operating income(1)	157.0		170.0		(13.0)	(7.6)	%	398.3		503.7		(105.4)	(20.9)	%
Adjusted EBITDA(1)	188.3		201.0		(12.7)	(6.3)	%	489.2		600.5		(111.3)	(18.5)	%
Financial expenses	20.7		9.3		11.4	122.6	%	58.4		23.7		34.7	146.4	%
Income tax expense	6.9		12.2		(5.3)	(43.4)	%	27.0		29.4		(2.4)	(8.2)	%
Net earnings	127.4		153.0		(25.6)	(16.7)	%	380.3		457.6		(77.3)	(16.9)	%
Adjusted net earnings(1)	129.4		153.4		(24.0)	(15.6)	%	323.4		457.5		(134.1)	(29.3)	%
Basic EPS	0.73		0.84		(0.11)	(13.1)	%	2.14		2.47		(0.33)	(13.4)	%
Diluted EPS	0.73		0.84		(0.11)	(13.1)	%	2.14		2.46		(0.32)	(13.0)	%
Adjusted diluted EPS(1)	0.74		0.84		(0.10)	(11.9)	%	1.82		2.46		(0.64)	(26.0)	%
Gross margin(2)	27.5	%	29.7	%	n/a	(2.2) pp		26.7	%	30.1	%	n/a	(3.4) pp
Adjusted gross margin(1)	27.5	%	29.7	%	n/a	(2.2) pp		26.5	%	30.0	%	n/a	(3.5) pp
SG&A expenses as a percentage of net sales(3)	9.5	%	9.7	%	n/a	(0.2) pp		10.0	%	10.0	%	n/a	—
Operating margin(4)	17.8	%	20.5	%	n/a	(2.7) pp		19.3	%	20.3	%	n/a	(1.0) pp
Adjusted operating margin(1)	18.1	%	20.0	%	n/a	(1.9) pp		16.5	%	20.0	%	n/a	(3.5) pp


	Oct 1, 2023	Jan 1, 2023	Variation
			$	%
Total assets	3,572.3	3,440.2	132.1	3.8	%
Total non-current financial liabilities	725.0	780.0	(55.0)	(7.1)	%
Net debt(1)	1,018.1	873.6	144.5	16.5	%

Quarterly cash dividend declared per common share	0.186	0.169	0.017	10.1	%
Net debt leverage ratio(1)	1.6	1.1	n/a	n/a

n.m. = not meaningful

n/a = not applicable

(1) This is a non-GAAP financial measure or ratio. See section 15.0 "Definition and reconciliation of non-GAAP financial measures" in this MD&A.

(2) Gross margin is defined as gross profit divided by net sales.

(3) SG&A as a percentage of sales is defined as SG&A divided by net sales.

(4) Operating margin is defined as operating income divided by net sales.

(5) The Company recasted comparative figures to conform to the current period's presentation by grouping Impairment (reversal of impairment) of trade accounts receivable in SG&A expenses.

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

QUARTERLY REPORT - Q3 2023 P.12


			MANAGEMENT'S DISCUSSION AND ANALYSIS

5.4 Operating review


	Three months ended					Nine months ended
(in $ millions, or otherwise indicated)	Oct 1, 2023	Oct 2, 2022	Variation			Oct 1, 2023	Oct 2, 2022	Variation
			$	%				$	%

Activewear	744.4	742.0	2.4	0.3	%	2,024.0	2,167.1	(143.1)	(6.6)	%
Hosiery and underwear	125.5	108.0	17.5	16.2	%	389.2	353.4	35.8	10.1	%
Total net sales	869.9	850.0	19.9	2.3	%	2,413.2	2,520.5	(107.3)	(4.3)	%

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

Net sales for the third quarter ended October 1, 2023 were up 2%, driven by growth in the Hosiery and underwear category. Total Activewear sales were essentially flat year over year, as the favourable impact of higher sales of fleece products was offset by lower volumes in certain other categories and slightly lower net selling prices. The Hosiery and underwear category was up 16% driven by sales volume growth as we benefited from the expansion and the roll-out of new programs in the mass retail channel as well as strength in hosiery.

Net sales for the nine months ended October 1, 2023 were down 4% compared to the same period last year, reflecting declines in Activewear partly offset by growth in the Hosiery and underwear category over the prior year. The decline in Activewear sales was primarily due to lower sales volumes compared to the prior year which benefited from distributor inventory replenishment following the pandemic, as well as the unfavourable impact of product mix stemming from current macro-economic conditions. Year-over-year POS trends for the Activewear category improved sequentially through the first three quarters of 2023. The Hosiery and underwear category was up 10%, driven by volume growth for the reasons mentioned above.

International markets remained challenging for the three and nine months ended October 1, 2023 with sales down respectively 23% and 14% versus the prior year with POS trends softening sequentially from the second to the third quarter.

5.4.2 Gross profit and adjusted gross profit


	Three months ended					Nine months ended
(in $ millions, or otherwise indicated)	Oct 1, 2023		Oct 2, 2022		Variation	Oct 1, 2023		Oct 2, 2022		Variation

Gross profit	239.2		252.2		(13.0)	643.5		757.6		(114.1)
Adjustments for:
Impact of strategic product line initiatives(1)	—		—		—	—		(1.0)		1.0
Net insurance losses (gains)(1)	—		—		—	(3.1)		(0.3)		(2.8)
Adjusted gross profit(2)	239.2		252.2		(13.0)	640.4		756.3		(115.9)
Gross margin	27.5	%	29.7	%	(2.2) pp	26.7	%	30.1	%	(3.4) pp
Adjusted gross margin(2)	27.5	%	29.7	%	(2.2) pp	26.5	%	30.0	%	(3.5) pp

(1) See subsection entitled "Certain adjustments to non-GAAP measures" for additional information on adjustments in section 15.0 "Definition and reconciliation of non-GAAP financial measures" in this MD&A.

(2) This is a non-GAAP financial measure or ratio. See section 15.0 "Definition and reconciliation of non-GAAP financial measures" in this MD&A.

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

The decrease in gross profit and adjusted gross profit for the three and nine months ended October 1, 2023 was driven by the decline in sales and lower gross margins. The year over year decline in gross margin and adjusted gross margin in the third quarter was driven by higher raw materials and manufacturing input costs as well as slightly lower net selling prices. The decline in gross margin and adjusted gross margin for the first nine months of 2023 versus the same period last year was mainly a result of the flow-through impact on our cost of sales of peak fiber costs and higher manufacturing input costs, which were partly offset by slightly higher average net selling prices.

QUARTERLY REPORT - Q3 2023 P.13


			MANAGEMENT'S DISCUSSION AND ANALYSIS

5.4.3 Selling, general and administrative expenses (SG&A)


	Three months ended					Nine months ended
(in $ millions, or otherwise indicated)	Oct 1, 2023		Oct 2, 2022		Variation	Oct 1, 2023		Oct 2, 2022		Variation

SG&A expenses	82.2		82.2		—	242.1		252.7		(10.6)
SG&A expenses as a percentage of net sales	9.5	%	9.7	%	(0.2) pp	10.0	%	10.0	%	—

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

For the third quarter ended October 1, 2023, SG&A expenses of $82 million were flat year over year, and as a percentage of sales SG&A was down 20 basis points to 9.5%, primarily reflecting the benefit of sales leverage. SG&A expenses for the first nine months of 2023 of $242 million were $11 million below prior year levels. SG&A expenses as a percentage of net sales were 10.0%, in line with prior year, as sales deleverage was offset by the benefit of lower expenses including lower variable compensation, as well recoveries of trade accounts receivable impairments (as noted in subsection 5.4.4. below).

5.4.4 Impairment (Reversal of impairment) of trade accounts receivable

For the three and nine months ended October 1, 2023, the reversal of impairment of trade accounts receivable was $0.4 million and $4.2 million, respectively, compared to an impairment of trade accounts receivable of $2.8 million and $4.4 million, respectively, for the three and nine months ended October 2, 2022. The reversal of impairment of trade accounts receivable for the three and nine months ended October 1, 2023 is mainly related to a decrease in the expected credit loss rates for specific customers, partially offset by the impact of increases in overall trade receivables. For the three and nine months ended October 2, 2022, the impairment of trade accounts receivable was mainly related to an increase in trade accounts receivable balances, and specific provisions on higher risk customers. Impairment (Reversal of impairment) of trade accounts receivable are included in selling, general and administrative expenses.

5.4.5 Gain on sale and leaseback and net insurance gains

During the first quarter of fiscal 2023, the Company entered into an agreement to sell and leaseback one of its distribution centres located in the U.S. The proceeds of disposition were $51 million. The Company recognized a right-of-use asset of $4 million and a lease obligation of $16 million. In addition, a pre-tax gain on sale of $25 million ($16 million after tax) was recognized in the condensed interim consolidated statements of earnings and comprehensive income in gain on sale and leaseback.

During the second quarter of fiscal 2023, the Company finalized an agreement with the insurer to close its insurance claims related to the two hurricanes which occurred in Central America in November 2020, and received a final insurance claims payment of $74 million, relating to the business interruption portion of its claims. This payment resulted in the recognition of a corresponding gain in the Company’s consolidated statement of earnings and comprehensive income in the second quarter of 2023.

QUARTERLY REPORT - Q3 2023 P.14


			MANAGEMENT'S DISCUSSION AND ANALYSIS

5.4.6 Restructuring and acquisition-related costs (recovery)


	Three months ended			Nine months ended
(in $ millions)	Oct 1, 2023	Oct 2, 2022	Variation	Oct 1, 2023	Oct 2, 2022	Variation

Employee termination and benefit costs	(0.1)	—	(0.1)	15.7	0.6	15.1
Exit, relocation and other costs	1.2	0.4	0.8	11.2	1.2	10.0

Net (gain) loss on disposal, write-downs, and accelerated depreciation of property, plant and equipment, right-of-use assets and computer software related to exit activities	0.9	(5.0)	5.9	8.0	(7.7)	15.7
Acquisition-related transaction costs	—	—	—	—	0.1	(0.1)
Restructuring and acquisition-related costs (recovery)	2.0	(4.6)	6.6	34.9	(5.8)	40.7

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

Restructuring and acquisition-related costs for the nine months ended October 1, 2023 related to the following: $29.5 million primarily for the consolidation and closure of manufacturing facilities in Central America, $3.9 million related to the December 2022 closure of a yarn-spinning plant in the U.S., and the exit cost from terminating a lease on a previously closed yarn facility, and $1.5 million mainly related to the completion of previously initiated restructuring activities. Restructuring and acquisition-related recovery for the nine months ended October 2, 2022 mainly related to a gain of $6.0 million on business dispositions, and a gain of $3.4 million on the sale of a former manufacturing facility in Mexico, partly offset by $2.1 million in accelerated depreciation of right-of-use assets, $0.6 million in employee termination and benefit costs related to the closure of a distribution center in the U.S., as well $0.8 million related to the completion of previously initiated restructuring activities.

5.4.7 Operating income and adjusted operating income


	Three months ended					Nine months ended
(in $ millions, or otherwise indicated)	Oct 1, 2023		Oct 2, 2022		Variation	Oct 1, 2023		Oct 2, 2022		Variation

Operating income	155.0		174.6		(19.6)	465.7		510.8		(45.1)
Adjustments for:
Restructuring and acquisition-related costs (recovery)(1)	2.0		(4.6)		6.6	34.9		(5.8)		40.7
Impact of strategic product line initiatives(1)	—		—		—	—		(1.0)		1.0
Net insurance gains(1)	—		—		—	(77.3)		(0.3)		(77.0)
Gain on sale and leaseback(1)	—		—		—	(25.0)		—		(25.0)
Adjusted operating income(2)	157.0		170.0		(13.0)	398.3		503.7		(105.4)
Operating margin	17.8	%	20.5	%	(2.7) pp	19.3	%	20.3	%	(1.0) pp
Adjusted operating margin(2)	18.1	%	20.0	%	(1.9) pp	16.5	%	20.0	%	(3.5) pp

(2) This is a non-GAAP financial measure or ratio. See section 15.0 "Definition and reconciliation of non-GAAP financial measures" in this MD&A.

Certain minor rounding variances exist between the unaudited condensed interim consolidated financial statements and this summary.

The decrease in operating income in the third quarter compared to last year reflected the lower gross profit and the impact of higher restructuring charges. Operating income in the first nine months of 2023 also reflected lower gross profit and higher restructuring charges compared to last year, partly offset by the net insurance gain related to two hurricanes which impacted the Company’s operations in Central America in 2020 and the gain from the sale and leaseback of one of our U.S. distribution facilities. The year-over-year decrease in adjusted operating income in both the third quarter and first nine months of 2023 reflected lower adjusted gross profit as noted above, which were partly offset by lower SG&A expenses for the first nine months period.

QUARTERLY REPORT - Q3 2023 P.15


			MANAGEMENT'S DISCUSSION AND ANALYSIS

5.4.8 Financial expenses, net


Exhibit						Description of Exhibit

99.1						Management's Discussion and Analysis
99.2						Interim Financial Statements
99.3						Certifications of Interim Filings - CEO
99.4						Certifications of Interim Filings - CFO


(in $ millions)	Oct 1, 2023	Jan 1, 2023	Variation

Cash and cash equivalents	102.5	150.4	(47.9)
Trade accounts receivable	449.4	248.8	200.6

Inventories	1,138.2	1,225.9	(87.7)
Prepaid expenses, deposits and other current assets	117.4	101.8	15.6

Accounts payable and accrued liabilities	(407.5)	(471.2)	63.7
Income tax payable	(0.1)	(6.6)	6.5
Current portion of lease obligations	(15.2)	(13.8)	(1.4)

Current portion of long-term debt	(300.0)	(150.0)	(150.0)

Total working capital(1)	1,084.7	1,085.3	(0.6)


Current ratio(2)	2.5	2.7	n.m.


(in $ millions)	Property, plant and equipment	Right-of-use assets	Intangible assets	Goodwill

Balance, January 1, 2023	1,115.2	78.0	230.0	271.7
Additions	162.9	11.2	3.5	—


Depreciation and amortization	(75.1)	(9.9)	(10.4)	—
Net carrying amounts of disposals	(25.7)	—	—	—
(Write-downs and impairments) Reversal of impairments	—	(1.2)	—	—
Balance, October 1, 2023	1,177.3	78.1	223.1	271.7


	Three months ended			Nine months ended
(in $ millions)	Oct 1, 2023	Oct 2, 2022	Variation	Oct 1, 2023	Oct 2, 2022	Variation

Net earnings	127.4	153.0	(25.6)	380.3	457.6	(77.3)
Adjustments for:
Depreciation and amortization	31.3	31.1	0.2	90.9	96.9	(6.0)


Timing differences between settlement of financial derivatives and transfer of deferred gains and losses in accumulated OCI to inventory and net earnings	(0.5)	(29.7)	29.2	9.5	7.9	1.6
(Gain) Loss on disposal of property, plant and equipment, including insurance recoveries	—	—	—	(25.2)	(6.2)	(19.0)
Deferred income taxes	3.5	10.2	(6.7)	13.4	14.2	(0.8)
Share-based compensation	6.8	8.4	(1.6)	22.8	24.1	(1.3)
Other	(11.1)	(2.8)	(8.3)	(7.1)	(5.4)	(1.7)
Changes in non-cash working capital balances	147.9	(104.4)	252.3	(177.1)	(365.0)	187.9

Cash flows from (used in) operating activities	305.3	65.8	239.5	307.5	224.1	83.4


	Three months ended			Nine months ended
(in $ millions)	Oct 1, 2023	Oct 2, 2022	Variation	Oct 1, 2023	Oct 2, 2022	Variation

Purchase of property, plant and equipment	(41.6)	(73.6)	32.0	(168.6)	(160.0)	(8.6)
Purchase of intangible assets	(1.0)	(0.9)	(0.1)	(3.8)	(4.0)	0.2
Business dispositions (acquisitions)	—	27.9	(27.9)	—	27.9	(27.9)
Proceeds from sale and leaseback and other disposals of property, plant and equipment	2.0	1.4	0.6	53.3	6.7	46.6
Cash flows from (used in) investing activities	(40.6)	(45.2)	4.6	(119.1)	(129.4)	10.3


	Effective interest rate(1)	Principal amount		Maturity date
(in $ millions, or otherwise indicated)		Oct 1, 2023	Jan 1, 2023
Non-current portion of long-term debt
Revolving long-term bank credit facility, interest at variable U.S. interest rate(2)(3)	6.4%	275.0	330.0	March 2027
Term loan, interest at variable U.S. interest rate, payable monthly(2)(4)	4.6%	300.0	300.0	June 2026


Notes payable, interest at fixed rate of 2.91%, payable semi-annually(5)	2.9%	100.0	100.0	August 2026
Notes payable, interest at Adjusted SOFR plus a spread of 1.57%, payable quarterly(5)(6)	2.9%	50.0	50.0	August 2026
		725.0	780.0
Current portion of long-term debt
Notes payable, interest at fixed rate of 2.70%, payable semi-annually(5)	2.7%	—	100.0	August 2023
Notes payable, interest at Adjusted LIBOR plus a spread of 1.53%, payable quarterly(5)(7)	2.7%	—	50.0	August 2023
Delayed draw term loan (DDTL), interest at variable U.S. interest rate, payable monthly(2)(4)	7.1%	300.0	—	May 2024
		300.0	150.0
Long-term debt (including current portion)		1,025.0	930.0


(in $ millions)	Carrying amount	Contractual cash flows	Less than 1 year	1 to 3 years	4 to 5 years	More than 5 years

Accounts payable and accrued liabilities	407.5	407.5	407.5	—	—	—
Long-term debt	1,025.0	1,025.0	300.0	450.0	275.0	—
Interest obligations(1)	—	140.0	52.5	78.0	9.5	—
Purchase and other obligations(2)	—	460.7	223.9	150.6	85.9	0.3
Lease obligations	95.6	114.1	20.4	33.8	24.0	35.9
Total contractual obligations	1,528.1	2,147.3	1,004.3	712.4	394.4	36.2


	October 1, 2023		January 1, 2023
Current assets:
Cash and cash equivalents	$	102,505	$	150,417
Trade accounts receivable (note 4)	449,377		248,785

Inventories (note 5)	1,138,166		1,225,940
Prepaid expenses, deposits and other current assets	117,415		101,810

Total current assets	1,807,463		1,726,952
Non-current assets:
Property, plant and equipment	1,177,289		1,115,169
Right-of-use assets	78,134		77,958
Intangible assets	223,065		229,951
Goodwill	271,677		271,677
Deferred income taxes	2,598		16,000
Other non-current assets	12,092		2,507
Total non-current assets	1,764,855		1,713,262
Total assets	$	3,572,318	$	3,440,214
Current liabilities:
Accounts payable and accrued liabilities	$	407,450	$	471,208

Income taxes payable	142		6,637
Current portion of lease obligations (note 8(d))	15,234		13,828


Current portion of long-term debt (note 6)	300,000		150,000
Total current liabilities	722,826		641,673
Non-current liabilities:
Long-term debt (note 6)	725,000		780,000
Lease obligations (note 8(d))	80,389		80,162

Other non-current liabilities	51,122		56,217
Total non-current liabilities	856,511		916,379
Total liabilities	1,579,337		1,558,052
Equity:
Share capital	222,756		202,329
Contributed surplus	73,598		79,489
Retained earnings	1,667,871		1,590,499
Accumulated other comprehensive income (note 10)	28,756		9,845
Total equity attributable to shareholders of the Company	1,992,981		1,882,162
Total liabilities and equity	$	3,572,318	$	3,440,214


	Share capital			Contributed surplus		Accumulated other comprehensive income			Retained earnings		Total equity
	Number	Amount
Balance, January 1, 2023	179,709	$	202,329	$	79,489		$	9,845	$	1,590,499	$	1,882,162
Share-based compensation	—	—		22,735			—		—		22,735
Shares issued under employee share purchase plan	41	1,217		—			—		—		1,217
Shares issued pursuant to exercise of stock options	448	12,865		(1,861)			—		—		11,004
Shares issued or distributed pursuant to vesting of restricted share units	652	14,485		(30,146)			—		—		(15,661)

Shares repurchased for cancellation	(6,213)	(7,590)		—			—		(182,682)		(190,272)
Share repurchases for settlement of non-Treasury RSUs	(648)	(550)		—			—		(19,005)		(19,555)
Deferred compensation to be settled in non-Treasury RSUs	—	—		2,075			—		—		2,075
Dividends declared	—	—		1,306			—		(101,213)		(99,907)
Transactions with shareholders of the Company recognized directly in equity	(5,720)	20,427		(5,891)			—		(302,900)		(288,364)
Cash flow hedges (note 10)	—	—		—			18,911		—		18,911

Net earnings	—	—		—			—		380,272		380,272
Comprehensive income	—	—		—			18,911		380,272		399,183
Balance, October 1, 2023	173,989	$	222,756	$	73,598		$	28,756	$	1,667,871	$	1,992,981
Balance, January 2, 2022	192,267	$	191,732	$	58,128		$	64,809	$	1,604,736	$	1,919,405
Share-based compensation	—	—		23,974			—		—		23,974
Shares issued under employee share purchase plan	33	1,114		—			—		—		1,114
Shares issued pursuant to exercise of stock options	43	1,343		(327)			—		—		1,016
Shares issued or distributed pursuant to vesting of restricted share units	150	4,255		(8,319)			—		—		(4,064)

Shares repurchased for cancellation	(11,897)	(12,099)		—			—		(395,151)		(407,250)
Share repurchases for settlement of non-Treasury RSUs	(148)	(116)		—			—		(5,593)		(5,709)
Deferred compensation to be settled in non-Treasury RSUs	—	—		2,110			—		—		2,110
Dividends declared	—	—		1,127			—		(94,391)		(93,264)
Transactions with shareholders of the Company recognized directly in equity	(11,819)	(5,503)		18,565			—		(495,135)		(482,073)
Cash flow hedges (note 10)	—	—		—			(36,661)		—		(36,661)

Net earnings	—	—		—			—		457,640		457,640
Comprehensive income	—	—		—			(36,661)		457,640		420,979
Balance, October 2, 2022	180,448	$	186,229	$	76,693		$	28,148	$	1,567,241	$	1,858,311


			NOTES TO CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


	October 1, 2023		January 1, 2023
Raw materials and spare parts inventories	$	174,336	$	251,700
Work in progress	63,133		77,726
Finished goods	900,697		896,514
	$	1,138,166	$	1,225,940


	October 1, 2023		January 1, 2023
Current	$	15,234	$	13,828
Non-current	80,389		80,162
	$	95,623	$	93,990


	October 1, 2023
Less than one year	$	20,387
One to five years	57,757
More than five years	35,870
	$	114,014


	October 1, 2023		January 1, 2023
Financial assets
Amortized cost:
Cash and cash equivalents	$	102,505	$	150,417
Trade accounts receivable	449,377		248,785
Financial assets included in prepaid expenses, deposits and other current assets	50,818		48,274
Long-term non-trade receivables included in other non-current assets	10,765		118
Fair value through other comprehensive income:
Derivative financial assets included in prepaid expenses, deposits and other current assets	30,563		23,765

Financial liabilities
Amortized cost:
Accounts payable and accrued liabilities(1)	400,852		462,496

Long-term debt - bearing interest at variable rates	925,000		730,000
Long-term debt - bearing interest at fixed rates(2)	100,000		200,000
Fair value through other comprehensive income:
Derivative financial liabilities included in accounts payable and accrued liabilities	6,598		8,712