The Company estimates that the implementation of these changes will take place over the course of a year .. CEO Comments on the Quarter and State of the Business Mr. Aviram Lahav, Delta’s CEO, stated today: “The decrease in sales in Europe and in the US in the first quarter of 2007 is due to the erosion of selling prices and increased competition. . . The changes in the business environment in the intimate apparel division in the US and in Europe as reflected in the continuation of erosion in the selling prices; increased competition, rising prices in the manufacturing cost and the strengthening of the shekel against the dollar, led us to the decision to adopt the restructuring plan, in order to improve our competitive ability. The plan includes downsizing costs and transferring production facilities to lower cost countries. Our intention is to expand operations in Egypt so it will become the main manufacturing facility that will serve our clients in Europe and in the US Upper Market. . . Furthermore, we are implementing a restructuring plan in our socks division, which will include downsizing of overheads, and transferring of production to lower cost facilities in Bulgaria and in the Far East. . . “We anticipate that these measures will contribute to the improvement of Delta’s competitiveness and its return to profitability,” concluded Mr. Lahav.
Date:5/21/2007
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