Delta Apparel's wares are a wardrobe basic: the t-shirt. The company manufactures knitted cotton and polyester/cotton t-shirts, tank tops, sweatshirts, and caps for screen printers. Through subsidiary M.J. Soffe, Delta Apparel also designs, makes, and sells branded and private-label activewear apparel to mainly to US distributors, sporting goods and specialty stores, mass merchants, traditional and upscale department stores, the US military, college bookstores, and online. The company's garments are finished at plants in North Carolina, and abroad in Mexico, El Salvador, and Honduras. Delta entered the business of custom apparel design by acquiring Art Gun Technologies, and hats by taking over Gekko Brands.
The company organizes its business into two segments: basics and branded. Its basics segment, which generated 53% of its 2011 sales, comprises unembellished knit apparel branded as Delta Pro Weight, Delta Magnum Weight, Quail Hollow, to name a few. The basics arm also functions as a private-labeler for retailers, sports licensors, and corporate programs. Delta Apparel's branded segment, accounting for 47% of sales, focuses on activewear items that are sold under the Soffe, Salt Life, The Game, and Realtree Outfitters labels, through boutiques and high-end specialty retailers.
Delta Apparel's sales are fueled by predominantly by domestic demand. International customers in 2011 accounted for 1% of sales.
In 2011 Delta Apparel marked its eighth consecutive year of record sales. Sales increased 12% over the prior year. Growth is driven by higher selling prices coupled with success in winning new customers and expanding relationships with established customers. In addition to boosting its top line, earnings jumped 42%. Results reflect relief from the one-time costs incurred in 2009 and 2008. Delta shuttered its manufacturing plant in Fayetteville, North Carolina, in 2009 and moved its operations to another North Carolina plant in Maiden (its last plant in the US) and Honduras. The shutdown was estimated to drive about $1 million annually in cost savings. In 2008 Delta closed a textiles plant in Alabama.
Delta Apparel's strategy focuses on growth through acquisitions in its branded and private-label businesses; it has acquired seven companies since 2003. Through M.J. Soffe subsidiary TCX, LLC, Delta Apparel in July 2010 purchased the assets of HPM Apparel, doing business as The Cotton Exchange. The North Carolina-based designer and marketer of decorated branded casual apparel expanded Delta Apparel's customer based of college bookstores, the US military, and other retailers. To accomplish the purchase, a month earlier Delta Apparel formed TCX, LLC as a subsidiary of M.J. Soffe.
The deal for HPM followed Delta Apparel's late 2009 takeover of Art Gun Technologies, a software developer of custom garment designs, digital printing, and shipping arrangements. Delta Apparel also snagged headwear supplier Gekko Brands, a subsidiary of Ashworth, for nearly $6 million in early 2009. Gekko, known for its Kudzu and The Game brands, complemented Delta's activewear offerings and expanded its distribution channels.
Members of the family of Edward Crosby "Ned" Johnson III control 10% of Delta Apparel through FMR LLC. An investor, Johnson and his daughter Abigail own and manage FMR, better known as Fidelity Investments.