Question 3

Gildan Activewear Inc. is mainly in the business of manufacturing and selling active wear, socks, and underwear. Exhibits 9.14A and 9.14B contain the statements of financial position and statements of earnings and comprehensive income from Gildans 2016 annual report. EXHIBIT 9.14A Gildan Activewear Inc.s 2016 Consolidated Statements of Financial Position

EXHIBIT 9.14B Gildan Activewear Inc.s 2016 Consolidated Statements of Earnings and Comprehensive Income

Calculate the companys working capital for 2016 and 2015. (Enter amounts in US$ thousand.) Working Capital for:

2015= $?

2016= $?

Calculate the current and quick ratios for 2016 and 2015. (Round answers to 1 decimal place, e.g. 15.1.)

Quick ratio:

2015 = ?

2016= ?

Comment on trends:

Current ratio= Deteriorated/ remained constant/ improved ?

Quick ratio= Deteriorated/ remained constant/ improved ?

Calculate the accounts payable turnover ratio and accounts payable payment period for the company. (Round accounts payable turnover ratio to 1 decimal place, e.g. 15.2 and average payment period to 0 decimal places, e.g. 152. Use 365 days for calculation.)

Accounts payable turnover ratio= ? times

Avg payable payment period= ? days

GILDAN ACTIVEWEAR INC. Consolidated Statements of Financial Position (in thousands of U.S. dollars) January 1, 2017 January 3, 2016 $ 38,197 277,733 954,876 69,719 $ 50,675 306,132 851,033 42,934 2,840 1,253,614 1,340,525 Current assets: Cash and cash equivalents (note 6) Trade accounts receivable (note 7) Inventories (note 8) Prepaid expenses, deposits and other current assets Assets held for sale Total current assets Non-current assets: Property, plant and equipment (note 9) Intangible assets (note 10) Goodwill (note 10) Deferred income taxes (note 18) Other non-current assets Total non-current assets Total assets 1,076,883 1,044,389 354,221 336,753 202,108 190,626 1,500 2,793 14,907 6,105 1,649,6191,580,666 $2,990,144 $2,834,280 $ 234,062 1,866 235,928 $ 232,268 953 233,221 Current liabilities: Accounts payable and accrued liabilities Income taxes payable Total current liabilities Non-current liabilities: Long-term debt (note 11) Other non-current liabilities (note 12) Total non-current liabilities Total liabilities Commitments, guarantees and contingent liabilities (note 23) Equity: Share capital Contributed surplus Retained earnings Accumulated other comprehensive income Total equity attributable to shareholders of the Company Total liabilities and equity 600,000 34,569 634,569 870,497 375,000 37,616 412,616 645,837 152,313 23,198 1,903,525 40,611 2,119,647 $2,990,144 150,497 14,007 2,022,846 1,093 2,188,443 $2,834,280 GILDAN ACTIVEWEAR INC. Consolidated Statements of Earnings (in thousands of U.S. dollars) 2016 2015 (15 months) $2,959,238 2,229,130 730,108 387,963 14,908 327,237 Net sales Cost of sales Gross profit Selling, general and administrative expenses (note 16(a)) Restructuring and acquisition-related costs (note 17) Operating income Financial expenses, net (note 14(c)) Earnings before income taxes Income tax expense (note 18) Net earnings Other comprehensive income (loss), net of related income taxes: Cash flow hedges (note 14(d)) Actuarial loss on employee benefit obligations (note 12(a)) $2,585,070 1,865,367 719,703 336,433 11,746 371,524 19,686 351,838 5,200 346,638 17,797 309,440 4,526 304,914 39,518 (5,239) 34,279 $ 380,917 8,825 (10,000) (1,175) $ 303,739 Comprehensive income Earnings per share: (note 19) Basic (1) $ $ 1.47 1.47 $ $ 1.26 1.26 Diluted (1) (1) All earnings per share data and share data reflect the effects of the two-for-one stock split which took effect on March 27, 2015