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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0001061894-04-000015.txt : 20040601
<SEC-HEADER>0001061894-04-000015.hdr.sgml : 20040601
<ACCEPTANCE-DATETIME>20040601154323
ACCESSION NUMBER:		0001061894-04-000015
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20040601
FILED AS OF DATE:		20040601

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			GILDAN ACTIVEWEAR INC
		CENTRAL INDEX KEY:			0001061894
		STANDARD INDUSTRIAL CLASSIFICATION:	APPAREL & OTHER FINISHED PRODS OF FABRICS & SIMILAR MATERIAL [2300]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1003

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-14830
		FILM NUMBER:		04841288

	BUSINESS ADDRESS:	
		STREET 1:		725 MONTEE DE LIESSE
		STREET 2:		VILLE SAINT LAURENT
		CITY:			QUEBEC CANADA
		STATE:			A8
		ZIP:			00000
		BUSINESS PHONE:		5147352023

	MAIL ADDRESS:	
		STREET 1:		725 MONTEE DE LIESSE
		STREET 2:		ST LAURENT QUE
		CITY:			CANADA
		STATE:			A8
		ZIP:			00000
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>q2form6-k.htm
<DESCRIPTION>Q2 2004 QUARTERLY FINANCIAL STATEMENTS
<TEXT>
<HTML>
<HEAD>
<TITLE>Q2 2004 - Form 6-K</TITLE>
</HEAD>
<BODY>

<div align="justify">
  <div align="justify">
    <p align="left">&nbsp;</p>
    <p>&nbsp;</p>
    <P ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2"><B><font size="4">SECURITIES AND EXCHANGE COMMISSION<br>
  WASHINGTON, DC 20549</font></B></FONT></FONT></P>
    <p><font size="4">
      <!-- MARKER FORMAT-SHEET="Center Head Bold" -->
    </font></p>
    <p>&nbsp; </p>
    <P ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2"><B><font size="4">FORM 6-K</font></B></FONT></FONT></P>
    <p><font size="4">
      <!-- MARKER FORMAT-SHEET="Center Head Bold" -->
    </font></p>
    <p>&nbsp; </p>
    <P ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="4"><B>REPORT OF FOREIGN PRIVATE ISSUER<br>
      </B></FONT></FONT>Pursuant to Rule 13a-16 or 15d-16 under <br>
  the Securities Exchange Act of 1934</P>
    <P ALIGN="CENTER"><br>
    </P>
    <DIV align=center>
      <TABLE cellSpacing=0 cellPadding=0 width="100%" border=0>
        <TR>
          <TD width="50%"><FONT face="Times New Roman, Times, serif" size=3>For the month of: <STRONG>June, 2004</STRONG></FONT></TD>
          <TD align=right width="50%"><FONT face="Times New Roman, Times, serif"
      size=3>Commission File Number:<STRONG> 1-14830</STRONG></FONT></TD>
        </TR>
        <TR>
          <TD width="50%"><FONT face="Times New Roman, Times, serif"
      size=3>&nbsp;</FONT></TD>
          <TD width="50%"><FONT face="Times New Roman, Times, serif"
      size=3>&nbsp;</FONT></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD colSpan=2><div align="center"><STRONG>GILDAN ACTIVEWEAR INC.</STRONG></div></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD colSpan=2><div align="center"><FONT face="Times New Roman, Times, serif"
      size=2><EM>(Translation of Registrant's name into English)</EM></FONT></div></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD width="50%"><FONT face="Times New Roman, Times, serif"
      size=3>&nbsp;</FONT></TD>
          <TD width="50%"><p>&nbsp;</p>
              <p>&nbsp;</p></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD colSpan=2><div align="center">
              <P ALIGN="CENTER"><strong><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2">725 Mont&eacute;e de Liesse<br>
            Ville Saint-Laurent, Quebec <br>
              </FONT></FONT><font size="2">Canada H4T 1P5</font></strong></P>
          </div></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD colSpan=2><div align="center"><FONT face="Times New Roman, Times, serif"
      size=2><EM>(Address of principal executive offices)</EM></FONT></div></TD>
        </TR>
        <TR vAlign=bottom align=middle>
          <TD>&nbsp;</TD>
          <TD>&nbsp;</TD>
        </TR>
      </TABLE>
    </DIV>
    <p>&nbsp;</p>
    <p><FONT face="Times New Roman, Times, serif" size=3>Indicate by check mark whether the Registrant files or will file annual reports under cover of Form 20-F or Form 40-F. </FONT></p>
    <p>&nbsp; </p>
    <DIV align=center>
      <TABLE cellSpacing=0 cellPadding=0 border=0>
        <TR align=middle>
          <TD vAlign=top width=200>Form 20-F <U>&nbsp;&nbsp; &nbsp;&nbsp;</U>
          <TD vAlign=top width=200>Form 40-F <U>&nbsp;&nbsp;&nbsp;<strong>X</strong>&nbsp;&nbsp;</U></TD>
        </TR>
      </TABLE>
      <p align="left">&nbsp;</p>
    </DIV>
    <P>
    <P>
    <P><FONT face="Times New Roman, Times, serif" size=3>Indicate by check mark whether the Registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. </FONT>
    <P>
    <P>
    <DIV align=center>
      <TABLE cellSpacing=0 cellPadding=0 border=0>
        <TR align=middle>
          <TD vAlign=top width=150>Yes <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
          <TD vAlign=top width=150>No <U>&nbsp;&nbsp;<strong>X</strong>&nbsp;&nbsp;</U></TD>
        </TR>
      </TABLE>
    </DIV>
    <P>
    <P>
    <P><FONT face="Times New Roman, Times, serif" size=3>If</FONT><FONT color=#0000ff><FONT
color=#0000ff><FONT face=serif
size=2>&nbsp;</FONT></FONT></FONT><FONT face="Times New Roman, Times, serif" size=3> &#8220;Yes&#8221; is marked, indicate below the file number assigned to the Registrant in connection with Rule 12g3-2(b): 82-_<strong>N/A</strong>_.</FONT>
    <P>
    <P>
    <HR color=gray noShade SIZE=3>
    <p align="left">
      <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
    </p>
    <div align="justify"></div>
    <br>
    <br>
    <table width="99%"  border="0" cellspacing="0" cellpadding="0">
      <tr>
        <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
        <td width="54%" bgcolor="#000000"><blockquote>
            <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
            Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
          </font></p>
        </blockquote></td>
      </tr>
    </table>
  </div>
  <p>&nbsp;</p>
  <table width="99%"  border="0" cellspacing="0" cellpadding="0">
    <tr>
      <td width="44%"><div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>MESSAGE TO SHAREHOLDERS</B></FONT></div></td>
      <td width="8%">&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td><div align="justify"></div></td>
      <td>&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td rowspan="9"><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">On behalf of the Board of Directors, we are pleased to provide results for the six months ended April 4, 2004.</FONT> <br>
        <br>
      <font size="2" face="Times New Roman, Times, serif">The Company reported record second quarter net earnings of U.S. $14.3 million, or U.S. $0.48 per diluted share, up 6.7% from U.S. $13.4 million or U.S. $0.45 per diluted share in the second quarter of fiscal 2003. Analyst expectations for the quarter were in the range of U.S. $0.45 - U.S. $0.49 per diluted share. </font></div>        <div align="justify"></div>        <p align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company&#146;s results for the quarter include increases in cost of sales and depreciation expense due to the upward revaluation of opening inventories and fixed assets required under U.S. and Canadian GAAP to give effect to the change to U.S. functional currency. The gain on revaluation of opening assets was reflected directly in opening shareholders&#146; equity. Net earnings for the second quarter of fiscal 2004 were U.S. $15.9 million, or U.S. $0.53 per diluted share, before reflecting the accounting treatment
 of these adjustments resulting from the change to U.S. functional currency, up 18.7% and 17.8% respectively from the second quarter of fiscal 2003.</FONT> </p>        <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Compared to last year, the higher second quarter earnings reflected higher unit sales, further manufacturing efficiencies and more favourable product-mix. These factors were partially offset by increased cotton costs, lower selling prices, higher SG&amp;A costs due to the Company&#146;s sales growth and higher depreciation expense as a result of the Company&#146;s capital investment program. <br>
          <br>
        Sales in the quarter were U.S. $141.4 million, up 24.5% from U.S. $113.6 million in the second quarter of fiscal 2003. The higher sales were due to a 24.6% increase in unit shipments combined with a higher valued product-mix, partially offset by lower selling prices. The higher unit sales reflected continuing market share penetration in all target market segments, together with strong overall industry demand growth in the U.S. wholesale distributor channel.</FONT></div>
      <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif"><br>
      With effect from the beginning of calendar 2004, the Company&#146;s largest customer decided to discontinue its participation in the S.T.A.R.S. report by ACNielsen Market Decisions. This report is the basis for market and market share data provided by the Company for the U.S. wholesale distributor channel. As a result, the S.T.A.R.S. market share data for the second quarter of fiscal 2004 excludes the effect of</FONT></div></td>
      <td rowspan="9">&nbsp;</td>
      <td colspan="4"><div align="justify">
        <p><FONT size="2" FACE="Times New Roman, Times, serif">sales through our largest customer. On this basis, Gildan&#146;s share in the T-shirt segment of the U.S. wholesale distributor market increased to 31.2% from 29.1% in the second quarter of fiscal 2003, even though the Company focussed on higher-valued product-lines within the T-shirt category, and continued to not fully participate in highly discounted white T-shirt promotions. During the second quarter, Gildan&#146;s share of the sport shirt segment increased to 24.4% from 18.4% in the corresponding quarter of last year. Gildan became the leading brand within the sport shirt category during the quarter. Gildan&#146;s share of the fleece category was 14.3% in the second quarter, up from 10.7% in the second quarter a year ago.</FONT> </p>
        <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The table below summarizes the unit sales growth for the calendar quarter ended March 31, 2004 compared to the quarter ended March 31, 2003 for Gildan and for the industry overall through the U.S. wholesale distributor channel, as reported by S.T.A.R.S. after adjusting the prior period comparatives to exclude sales through our largest customer:</FONT> <br>
          <br>
        </P>
        </div></td>
    </tr>
    <tr>
      <td width="12%">&nbsp;</td>
      <td width="15%"><div align="center"><strong><font size="2" face="Times New Roman, Times, serif">Gildan<br>
          <U>Unit growth<br>
      </U></font></strong></div></td>
      <td width="3%"><div align="center"><strong><font size="2" face="Times New Roman, Times, serif"></font></strong></div></td>
      <td width="18%"><div align="center"><strong><font size="2" face="Times New Roman, Times, serif">Industry <br>
          <U>Unit growth<br>
      </U></font></strong></div></td>
    </tr>
    <tr>
      <td><font size="2" face="Times New Roman, Times, serif"><br>
      T-shirts</font></td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif"><br>
      30</font><font size="2" face="Times New Roman, Times, serif">.3%</font></div></td>
      <td>&nbsp;</td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif"><br>
      11</font><font size="2" face="Times New Roman, Times, serif">.6%</font></div></td>
    </tr>
    <tr>
      <td><font size="2" face="Times New Roman, Times, serif">Sport shirts</font></td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif">34</font><font size="2" face="Times New Roman, Times, serif">.7%</font></div></td>
      <td>&nbsp;</td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif">1</font><font size="2" face="Times New Roman, Times, serif">.1%</font></div></td>
    </tr>
    <tr>
      <td><font size="2" face="Times New Roman, Times, serif">Fleece</font></td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif">39</font><font size="2" face="Times New Roman, Times, serif">.2%</font></div></td>
      <td>&nbsp;</td>
      <td><div align="center"><font size="2" face="Times New Roman, Times, serif">13</font><font size="2" face="Times New Roman, Times, serif">.8%</font></div></td>
    </tr>
    <tr>
      <td colspan="4"><P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif"><br>
        Gildan noted that, in addition to the strong overall industry growth for T-shirts and fleece, the sport shirt category also showed positive growth, indicating that the steady decline in demand in this segment since 2001 may have ceased, reflecting a recovery in corporate promotional spending.</FONT> </P>
        <div align="justify"><font size="2" face="Times New Roman, Times, serif"></font></div></td>
    </tr>
    <tr>
      <td colspan="4"><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In parallel with the growth realized by Gildan with the S.T.A.R.S. distributors as per the table above, the Company also achieved a comparable rate of growth in its unit sales to its largest distributor during the second fiscal quarter, versus the corresponding quarter of fiscal 2003.</FONT> </div></td>
    </tr>
    <tr>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td colspan="4"><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Gildan&#146;s unit shipments in Europe increased by 38.9% over the second quarter last year, and shipments in Canada were up by 10.2%. Selling prices in the Canadian market were negatively impacted as a result of the lower landed selling prices for U.S. competitors in the Canadian market, due to the decline in the relative value of the U.S. dollar.</FONT> </div></td>
    </tr>
    <tr>
      <td>&nbsp;</td>
      <td>&nbsp;</td>
      <td colspan="4"><div align="justify"><font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
      </font> </div>        <FONT size="2" FACE="Times New Roman, Times, serif"><br>
      Gross margins in the second quarter were 26.6%, compared with 29.6% in the second quarter of fiscal</FONT></td>
    </tr>
  </table>
  <p><FONT size="2" FACE="Times New Roman, Times, serif"> </FONT> </p>
</div>
<div align="justify">
  <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">1</font></P>
  <hr size="3" noshade>
  <div align="justify">
    <table width="99%"  border="0" cellspacing="0" cellpadding="0">
      <tr>
        <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
        <td width="54%" bgcolor="#000000"><blockquote>
            <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
            Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
          </font></p>
        </blockquote></td>
      </tr>
    </table>
  </div>
  <font size="2" face="Times New Roman, Times, serif"><!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font>
</div>
<P ALIGN="justify">&nbsp;</P>
<table width="99%"  border="0" cellpadding="0" cellspacing="0">
  <tr>
    <td width="44%"><div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif">2003. Before the adjustments due to the change to U.S. functional currency, gross margins in the second quarter of fiscal 2004 were 27.3%. The favourable impact on percentage gross margins of the higher-valued product-mix, continuing manufacturing efficiencies and the non-recurrence of a prior year special charge (the closure of the Montreal sewing plant) was more than offset by the negative effect of higher cotton costs and lower industry selling prices. Promotional pricing activity during the quarter included additional discounts resulting from the higher than projected unit sales growth.<br>
    </FONT>
        <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><U>Six Months Earnings</U></FONT></P>
        <div align="justify"><font size="2" face="Times New Roman, Times, serif">Net earnings for the first six months of fiscal 2004 were $17.2 million or U.S. $0.58 per diluted share, essentially the same as the first six months of fiscal 2003 when the Company generated net earnings of U.S. $17.1 million or U.S. $0.58 per diluted share. Before the adjustments due to the change to U.S. functional currency, net earnings for the first six months of fiscal 2004 were U.S. $21.4 million, or U.S. $0.72 per share, up 25.1% and 24.1% respectively from the first six months of fiscal 2003.</font></div>
        <FONT SIZE="2" face="Times New Roman, Times, serif">        <br>
        </FONT></div></td>
    <td width="8%">&nbsp;</td>
    <td colspan="4"><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">channel being in reasonable balance, and higher raw material costs for both cotton and polyester &#150; appear to support higher pricing in the second half of the fiscal year. However, it is difficult to predict the outlook for industry pricing with any degree of certainty. Therefore, while the Company is projecting some gross margin improvement in the third and fourth quarter due to reduced promotional activity and a higher proportion of fleece sales in the balance of the year, the Company believes that, based on its short-term capacity constraints in the third quarter and the assumed continuation of aggressive industry pricing competition, it is more realistic to lower its projected EPS growth in the second half of the fiscal year. On this basis, the Company is now projecting EPS for the full fiscal year to be in the range of U.S. $2.05 &#150; U.S. $2.15 per diluted share before the U.S. functional currency adjustm
ents, up approximately 15% &#151; 20% from fiscal 2003. After reflecting the adjustments resulting from the transition to U.S. functional currency, the Company&#146;s revised EPS forecast for fiscal 2004 is U.S. $1.90 &#151; $2.00, up approximately 6% &#151; 12% from fiscal 2003.</FONT> <br>
      <br>
      <FONT size="2" FACE="Times New Roman, Times, serif">The Company now expects to achieve diluted EPS of U.S. $0.80 &#150; U.S. $0.85 in the third quarter before functional currency adjustments, up approximately 10% &#151; 16% from the third quarter of fiscal 2003, which included an extra week due to the Company&#146;s floating fiscal year-end. In the fourth quarter, Gildan now expects diluted EPS of U.S. $0.55 &#150; U.S. $0.60 before functional currency adjustments, up approximately 15% &#151; 25% from fiscal 2003. The functional currency adjustments in the third and fourth quarter of the fiscal year will be limited to the impact on depreciation expense, and will therefore not be material.</FONT></div></td>
  </tr>
  <tr>
    <td><div align="justify">
      <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><U>Earnings Outlook</U></FONT></P>
      <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company has previously indicated that it expects its EPS for the full fiscal year to be in the range of U.S. $2.25 &#150; U.S. $2.30, up 25.7% &#151; 28.5% from fiscal 2003 before the adjustments due to the change to U.S. functional currency. After reflecting the adjustments resulting from the transition to U.S functional currency, the Company&#146;s EPS guidance range for fiscal 2004 was U.S. $2.10-$2.15, up 17.3% &#151; 20.1% from fiscal 2003. This guidance was based on 15% projected growth in unit sales volumes and modest selling price increases to partially pass through the higher cost of cotton.</FONT> </div>
      <div align="justify"><font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
      </font> </div>
      <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif"><br>
        <br>
      </FONT></P>
    </div></td>
    <td>&nbsp;</td>
    <td colspan="4"><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Going forward, Gildan expects to achieve its objective of minimum 15% EPS growth beyond fiscal 2004, in addition to achieving 15% &#151; 20% EPS growth in the current fiscal year, even if industry pricing continues to decline. Gildan is slightly ahead of schedule with its timetable for construction of its Dominican Republic textile facility. As the Company brings this facility on stream, it expects to continue to lower its manufacturing costs and to have capacity available to further accelerate its market share penetration in the wholesale distributor channel in fiscal 2005, as well as to implement its plans to enter the retail channel. </FONT></div></td>
  </tr>
  <tr>
    <td><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In the first and second fiscal quarters, the Company has achieved its EPS growth projections by offsetting higher than anticipated promotional pricing activity with higher than projected unit sales volumes. Due to the higher unit sales in the first two quarters, and its resulting lower than planned inventory levels at the second quarter-end, the Company expects to have insufficient capacity in the third quarter to fully satisfy the projected growth in sales reflected in its prior forecast. Therefore, achievement of its original EPS guidance for the full year will depend upon improved selling prices being realized. Many industry fundamentals &#150; including strong industry demand, overall inventories within the distributor</FONT></div></td>
    <td>&nbsp;</td>
    <td colspan="4">&nbsp;</td>
  </tr>
</table>
<P ALIGN="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font></P>
<div align="justify">
  <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">2</font></P>
  <hr size="3" noshade>
  <div align="justify">
    <table width="99%"  border="0" cellspacing="0" cellpadding="0">
      <tr>
        <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
        <td width="54%" bgcolor="#000000"><blockquote>
            <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
        </blockquote></td>
      </tr>
    </table>
  </div>
  <font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
</font> </div>
<P ALIGN="justify">&nbsp;</P>
<div align="justify">
  <table width="99%"  border="0" cellpadding="0" cellspacing="0">
    <tr>
      <td width="47%"><div align="justify">
        <div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><U>Cash Flow</U></FONT></div>
        <div align="justify"><font size="2" face="Times New Roman, Times, serif">
          <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font> </div>
        <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In the second fiscal quarter, the Company used U.S. $16.7 million of cash, defined as cash flow from operating activities less cash used in investing activities, due to the seasonal financing of trade receivables (which reflected days sales outstanding of 45 days compared with 48 days a year ago) and the ongoing capital expenditure requirements to implement the Company&#146;s continuing offshore capacity expansion plans. <br>
          <br>
          The Company ended the quarter with surplus cash of U.S. $21.4 million. The Company intends to utilize U.S. $17.5 million of its surplus cash to meet the first scheduled instalment of its senior note repayment on June 10, 2004. Also, the Company now expects to invest approximately U.S. $65 million in capital expenditures for the full fiscal year, up from the previous estimate of approximately U.S. $60 million, due mainly to the accelerated timing for the Dominican Republic facility.</FONT></P>
      </div></td>
      <td width="8%">&nbsp;</td>
      <td width="45%" colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td>&nbsp;</td>
      <td>&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td><div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">As of April 30, 2004, there were 29,627,619 Class A subordinate shares issued and outstanding along with 679,635 options outstanding. <br>
        <br>
        On behalf of the Board of Directors, we wish to take this opportunity to thank our shareholders for their continued confidence and support.</FONT></div></td>
      <td>&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td>&nbsp;</td>
      <td>&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
    <tr>
      <td><P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><em>(s) H. Greg Chamandy</em><br>
        </FONT><font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  H.Greg Chamandy<br>
  Chairman of the Board,<br>
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  Chairman of the Executive Committee and<br>
  Co-Chief Executive Officer</font></P>
        <div align="justify">
          <p><font size="2" face="Times New Roman, Times, serif"><em>(s) Glenn J. Chamandy</em><br>
            </font><font size="2" face="Times New Roman, Times, serif">
            <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
    Glenn J. Chamandy<br>
    President,<br>
    <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
    Co-Chief Executive Officer and<br>
    Chief
    Operating Officer</font></p>
      </div></td>
      <td>&nbsp;</td>
      <td colspan="4">&nbsp;</td>
    </tr>
  </table>
  <font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font>
</div>
<P ALIGN="justify">&nbsp; </P>

<div align="justify"></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font>
</div>
<P ALIGN="justify">&nbsp; </P>

<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Italic" -->
  </font>
</div>
<P ALIGN="justify">&nbsp;</P>
<div align="justify">
  <P ALIGN="justify"><font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font></P>
  <div align="justify">
    <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">3</font></P>
    <hr size="3" noshade>
    <font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
  <P ALIGN="justify">&nbsp;</P>
  <p align="center"><font size="2" face="Times New Roman, Times, serif"> <strong><font size="4">Gildan Activewear Inc.</font><br>
  Consolidated Balance Sheets</strong></font><font size="2" face="Times New Roman, Times, serif"></font><font size="2" face="Times New Roman, Times, serif"><br>
  <font size="1">(In thousands of U.S. dollars)<br>
</font></font></p>
  <p><font size="2" face="Times New Roman, Times, serif"> </font> </p>
  <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
    <TR VALIGN="BOTTOM">
      <TH COLSPAN="2"></TH>
      <TH COLSPAN="2"></TH>
      <TH COLSPAN="2"></TH>
      <TH></TH>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><p><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font><font size="2" face="Times New Roman, Times, serif"><br>
      </font></p></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">October 5, 2003</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(audited)</font></TD>
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD WIDTH="45%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Current assets:</font></TD>
      <TD WIDTH="6%" ALIGN="LEFT"><div align="right"></div></TD>
      <TD WIDTH="13%" ALIGN="RIGHT"></TD>
      <TD WIDTH="4%" ALIGN="LEFT"><div align="right"></div></TD>
      <TD WIDTH="14%" ALIGN="RIGHT"></TD>
      <TD WIDTH="4%" ALIGN="LEFT"><div align="right"></div></TD>
      <TD WIDTH="14%" ALIGN="RIGHT"></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21,413</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;69,340</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;22,995</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">85,386</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">64,260</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">70,180</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">130,108</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">103,503</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">97,618</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and deposits</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,677</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,849</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,481</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Future income taxes</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,294</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,682</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,448</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="1" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">249,878</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">245,634</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">198,722</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Fixed assets</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">195,577</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">180,349</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">155,034</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Other assets</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,426</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,681</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,122</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="1" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total assets</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;448,881</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">429,664</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">356,878</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="2" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="2" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Current liabilities:</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;63,270</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;67,278</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;60,333</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2,175</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,909</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">675</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current portion of long-term debt</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">19,098</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">19,481</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,567</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="1" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">84,543</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">90,668</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">64,575</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Long-term debt</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">57,029</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">54,077</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">71,696</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Future income taxes</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">24,195</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">20,716</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">15,788</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Shareholders' equity:</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share capital (note 4)</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">77,012</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">75,490</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">73,311</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contributed surplus</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">404</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">220</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">220</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">179,450</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">162,245</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">126,191</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cumulative translation adjustment</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">26,248</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">26,248</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5,097</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="1" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">283,114</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">264,203</font></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">204,819</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="1" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="1" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total liabilities and shareholders' equity</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;448,881</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">429,664</font></TD>
      <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
      <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">356,878</font></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"> </div></TD>
      <TD ALIGN="LEFT"><hr size="2" noshade></TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD colspan="3" ALIGN="RIGHT"><div align="right">
          <hr size="2" noshade>
      </div></TD>
    </TR>
    <TR VALIGN="BOTTOM">
      <TD ALIGN="LEFT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
      <TD ALIGN="LEFT"><div align="right"></div></TD>
      <TD ALIGN="RIGHT">&nbsp;</TD>
    </TR>
  </TABLE>
  <p><font size="2" face="Times New Roman, Times, serif">See accompanying notes to interim consolidated financial statements. </font></p>
  <div align="justify">
    <P ALIGN="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></P>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">4</font></P>
      <hr size="3" noshade>
      <font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify">&nbsp;</P>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"> <font size="4"><strong>Gildan Activewear Inc.</strong></font><br>
          <font size="3"><strong>Consolidated Statements of Earnings</strong></font><br>
  (In thousands of U.S. dollars, except per share data)</font></p>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"> </font> </p>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="39%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sales</font></TD>
        <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;141,369</font></TD>
        <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="10%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;113,615</font></TD>
        <TD WIDTH="5%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="11%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;219,328</font></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;178,615</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cost of sales</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">103,832</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">80,031</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">160,691</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">125,946</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Gross profit</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">37,537</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">33,584</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">58,637</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">52,669</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Selling, general and administrative expenses</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">15,151</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">13,528</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">26,548</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">23,612</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Earnings before interest, income taxes,</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;depreciation and amortization</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">22,386</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">20,056</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">32,089</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,057</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Depreciation and amortization</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5,249</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,704</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">10,181</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">7,200</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Interest</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,755</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,713</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,344</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,158</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Earnings before income taxes</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">15,382</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">14,639</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">18,564</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">18,699</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Income taxes</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,049</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,228</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,359</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,597</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14,333</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13,411</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17,205</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17,102</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="2" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic EPS (note 5)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.48</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.46</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.59</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted EPS (note 5)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.48</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.45</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
      </TR>
    </TABLE>
    <p>&nbsp;</p>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"><strong><font size="3">Consolidated Statements of Retained Earnings </font></strong><br>
  (In thousands of U.S. dollars) </font></p>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"> </font></p>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong> </font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="41%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Retained earnings, beginning of the period</font></TD>
        <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="11%" ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;165,117</font></div></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="12%" ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;112,780</font></div></TD>
        <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="10%" ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;162,245</font></div></TD>
        <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="11%" ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;109,089</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">14,333</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">13,411</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">17,205</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">17,102</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Retained earnings, end of the period</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;179,450</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;126,191</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;179,450</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;126,191</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="2" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT"><hr size="2" noshade></TD>
      </TR>
    </TABLE>
    <p><font size="2" face="Times New Roman, Times, serif">See accompanying notes to interim consolidated financial statements. </font></p>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"> <strong><font size="4"></font></strong></font></p>
    <P ALIGN="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></P>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">5</font></P>
      <hr size="3" noshade>
      <font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify">&nbsp;</P>
    <p align="center"><font size="2" face="Times New Roman, Times, serif"> <font size="4"><strong>Gildan Activewear Inc. </strong></font><br>
          <font size="3"><strong>Consolidated Statements of Cash Flows</strong></font> <br>
  (In thousands of U.S. dollars) </font></p>
    <p><font size="2" face="Times New Roman, Times, serif"> </font> </p>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="100%">
      <TR VALIGN="BOTTOM">
        <TH></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">April 4, 2004</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">March 30, 2003</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(unaudited)</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="37%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash flows from operating activities:</font></TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="10%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="3%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="14%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="4%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="11%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="3%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net earnings</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">14,333</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">13,411</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,205</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,102</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments for:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5,249</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,704</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">10,181</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">7,200</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Future income taxes</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,339</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,727</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,461</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,871</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation expense</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">184</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">184</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(68</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">16</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(61</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(159</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">21,037</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">18,858</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,970</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">26,014</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net changes in non-cash working capital balances:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(39,820</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(33,657</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(20,619</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(13,665</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">9,140</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,505</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(26,605</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(18,817</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and deposits</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,710</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,551</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(2,828</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,933</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,963</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5,554</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(3,015</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">8,116</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,786</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,213</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,765</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,409</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(6,176</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(7,504</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(25,862</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,694</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash flows from financing activities:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayment of capital leases and other</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;long-term debt</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(453</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,103</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(1,624</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(2,109</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in secured debt</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,125</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">96</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from the issuance of shares</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,259</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,511</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,522</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2,308</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">806</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">408</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,023</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">295</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash flows from investing activities:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of fixed assets, net of disposals</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(10,450</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(9,533</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(26,573</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(20,973</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Increase) decrease in other assets</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(91</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">131</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(72</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">157</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(10,541</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(9,402</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(26,645</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(20,816</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Effect of exchange rate changes on cash and</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;cash equivalents</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(166</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(372</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">557</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">200</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net decrease in cash and cash equivalents</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;during the period</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(16,077</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(16,870</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(47,927</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(22,015</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash and cash equivalents, beginning of period</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 37,490</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 39,865</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 69,340</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 45,010</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="1" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash, end of period</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 21,413</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 22,995</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 21,413</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 22,995</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="6" ALIGN="RIGHT"><hr size="2" noshade></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><hr size="2" noshade></TD>
      </TR>
    </TABLE>
    <p><font size="2" face="Times New Roman, Times, serif">See accompanying notes to interim consolidated financial statements. </font></p>
    <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></p>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">6</font></P>
      <hr size="3" noshade>
      <br>
    </div>
    <div align="justify"><div align="justify">
      <table width="99%"  border="0" cellspacing="0" cellpadding="0">
          <tr>
            <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
            <td width="54%" bgcolor="#000000"><blockquote>
                <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
            </blockquote></td>
          </tr>
        </table>
      </div>
      <font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><br>
    </P>
    <div align="justify"> <FONT SIZE="2" face="Times New Roman, Times, serif"><B><U>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</U></B></FONT></div>
    <div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>(For the period ended April 4, 2004)</B></FONT></div>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif"><strong>(Tabular amounts in thousands of U.S. dollars, except per share data)
            <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
      </strong><br>
    </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>(unaudited)</B></FONT></div>
    <div align="justify"><br>
        <FONT SIZE="2" face="Times New Roman, Times, serif"><B>1. Basis of presentation: </B></FONT></div>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the Canadian generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by Canadian generally accepted accounting principles for complete financial statements, and should be read in conjunction with the Company&#146;s annual consolidated financial statements.</FONT> </P>
    <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company&#146;s revenues and income are subject to seasonal variations. Consequently, the results of operations for the second quarter ended April 4, 2004 are not traditionally indicative of the results to be expected for the full year.</FONT> </div>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">All amounts in the attached notes are unaudited unless specifically identified.</FONT> </P>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif"><strong>2. Change in functional and reporting currency:
            <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </strong> </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">As a result of a significant portion of its revenues, expenses, assets and liabilities being denominated in U.S. dollars and the increasing international scope of its sales and manufacturing operations, the Company adopted the U.S dollar as its functional and reporting currency effective October 6, 2003, the commencement of fiscal 2004. All opening assets and liabilities were translated into U.S. dollars using the exchange rate in effect on October 6, 2003. For comparative purposes, historical financial statements and notes thereto up to an including October 5, 2003 have been restated into U.S dollars in accordance with generally accepted accounting principles.</FONT> </P>
    <div align="justify">
      <p><FONT size="2" FACE="Times New Roman, Times, serif">The change in the functional currency for the prior periods resulted in a positive currency translation adjustment of $26.2 million as at October 5, 2003, which is reflected as a separate component of shareholders&#146; equity.</FONT> </p>
      <p><font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
        </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>3. Significant accounting policies:</B></FONT></p>
    </div>
    <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company applied the same accounting policies in the preparation of the interim consolidated financial statements, as disclosed in Note 1 of its audited consolidated financial statements in the Company&#146;s annual report for the year ended October 5, 2003.</FONT> </div>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The following policies have been applied for the first time in fiscal 2004:</FONT> </P>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">(a) Stock-Based Compensation and Other Stock-Based Payments:
          <!-- MARKER FORMAT-SHEET="Para Flush" -->
          <br>
      </font><FONT size="2" FACE="Times New Roman, Times, serif">In November 2003, the Canadian Institute of Chartered Accountants (&#147;CICA&#148;) revised Handbook Section 3870, with respect to the accounting for stock-based compensation and other stock-based payments. The revised recommendations require that beginning January 1, 2004, the fair value-based method be used to account for all transactions whereby goods and services are received in exchange for stock-based compensation and other stock-based payments. The revised standard no longer permits the use of the settlement method for stock-based employee compensation awards. Under the settlement method, any consideration paid by employees on the exercise of stock options is credited to share capital and no compensation expense is recognized. Under the fair value method, compensation cost is measured at fair value at the date of grant and is expensed over the award&#146;s vesting periods.</FONT> </div>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">During the second quarter of fiscal 2004, $184,000 (2003 &#150; nil) was expensed as compensation expense, with an offset to contributed surplus, due to the issuance of 60,000 Restricted Share Units and a modification to the vesting period of certain options.</FONT> </P>
    <div align="justify">
      <p><FONT size="2" FACE="Times New Roman, Times, serif">In accordance with the transitional options permitted under Section 3870, the Company has elected to early adopt the new recommendations effective the commencement of our 2004 fiscal year and prospectively apply the standard for employee stock awards granted after October 6, 2003. There were no options granted during the three months and six months ended April 4, 2004. Previously, the Company applied the settlement method of accounting to employee stock options. As required under the standard, the following disclosure is required to report the pro forma net earnings and earnings per share as if the fair value-based method had been used to account for employee stock options granted during our 2003 fiscal year.</FONT> </p>
      <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
      </font></p>
      <div align="justify">
        <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">7</font></P>
        <hr size="3" noshade>
        <br>
      </div>
      <div align="justify">
        <div align="justify">
          <table width="99%"  border="0" cellspacing="0" cellpadding="0">
            <tr>
              <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
              <td width="54%" bgcolor="#000000"><blockquote>
                  <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
                Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
              </font></p>
              </blockquote></td>
            </tr>
          </table>
        </div>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
      </font> </div>
      <P ALIGN="justify"><strong><font size="2" face="Times New Roman, Times, serif">3. Significant accounting policies (continued):
              <!-- MARKER FORMAT-SHEET="Para Flush" -->
      </font></strong><font size="2" face="Times New Roman, Times, serif"> </font></P>
    </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">(a) Stock-Based Compensation and Other Stock-Based Payments (continued):</FONT> </P>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="2"></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
              <U>2004</U> </font></TD>
        <TD colspan="2" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                  <U>2003</U> </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,<br>
      2004</U> </font></TD>
        <TD colspan="2" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,<br>
        2003</U> </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="49%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings, as reported</font></TD>
        <TD WIDTH="3%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD WIDTH="9%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 14,333</font></TD>
        <TD WIDTH="5%" ALIGN="LEFT"><div align="right"></div></TD>
        <TD WIDTH="6%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">13,411</font></TD>
        <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="3%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="8%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,205</font></TD>
        <TD WIDTH="4%" ALIGN="LEFT"><div align="right"></div></TD>
        <TD WIDTH="8%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,102</font></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Add (deduct):</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stock-based employee compensation (expense) recovery</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;determined under fair value based method for all awards</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;granted in fiscal 2003</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">107</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(64</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">24</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(85</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="11" ALIGN="LEFT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Pro forma net earnings</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 14,440</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">13,347</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,229</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">17,017</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Earnings per share:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As reported</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 0.48</font></TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.46</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 0.58</font></TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.59</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.49</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.46</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.58</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As reported</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 0.48</font></TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.45</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 0.58</font></TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.48</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.45</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.58</font></TD>
        <TD ALIGN="LEFT"><div align="right"></div></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.57</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="11" ALIGN="LEFT"><hr size="1" noshade></TD>
      </TR>
    </TABLE>
    <div align="justify"><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font> </div>
    <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">During the second quarter of fiscal 2004, 52,877 options granted in fiscal 2003 were cancelled which would have resulted in a recovery of stock-based compensation costs for the quarter of $107,000 since the Company only accounts for forfeitures as they occur.</FONT> </P>
    <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The weighted average fair value of the remaining 68,329 options granted during fiscal 2003, net of forfeitures, (48,329 options granted as at March 30, 2003) is CAD $10.74 per stock option (CAD $10.58 per stock option as at March 30, 2003), which would be recognized over the vesting period. The weighted average fair value of the stock options granted during fiscal 2003 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions: expected dividend yield of nil; expected volatility of 35.74%; risk-free interest rate of 3.69%; and expected lives of 3 years.</FONT> </div>
    <div align="justify"><br>
        <FONT SIZE="2" face="Times New Roman, Times, serif"><B>Restricted Share units</B></FONT></div>
    <div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Effective February 2004, the Board of Directors approved an amendment to the Company&#146;s Stock Option Plan (&#147;Plan&#148;) to change the name of the Plan to &#147;Long Term Incentive Plan of the Corporation&#148; and to allow the Board of Directors to grant restricted share units (&#147;RSU&#148;) under the Plan. An RSU is the right of an individual to whom a grant of such unit is made to receive one Class A Subordinate Voting Share at the end of the vesting periods of up to a maximum of 10 years should certain conditions be achieved, which include the employee&#146;s continued employment during that period and achievement of specified performance objectives, if any. Grant levels of RSUs are determined by the Board of Directors on the basis of merit and relative contribution of the participant to the Company. The RSUs may be subject to the attainment of performance objectives if any are established by the Board of Directors at
 the time of grant. At the end of the vesting period, the Class A Subordinate Voting Shares to which a holder of RSUs is entitled will be issued from treasury under the share limit provided in the Plan. The fair value of each RSU is calculated at the date of the grant. Compensation expense relating to the RSU plan is recognized in the financial statements over the vesting period. As of April 4, 2004 there were 60,000 RSUs awarded and outstanding of which none were vested or paid. The compensation expense recorded for the three months ended and six months ended April 4, 2004, in respect to this Plan was $55,000.</FONT> </div>
    <div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B><br>
      </B> (b) Hedging relationships<br>
    </FONT><FONT size="2" FACE="Times New Roman, Times, serif">In 2003, the CICA modified the Accounting Guideline 13, Hedging Relationships, applicable to hedging relationships outstanding for fiscal years beginning on or after July 1, 2003. In complying with this guideline, the Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. This process includes linking all derivatives to specific assets and liabilities on the balance sheet or to specific firm commitments or anticipated transactions. The Company also formally assesses, both at the hedge&#146;s inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting cash flows of hedged items. When hedging instruments become ineffective before their maturity and are not replaced within the Company&#146;s documented hedging strategy or the hedging relationship 
is terminated, deferred gains or losses on such instruments continue to be deferred and charged to income in the same period as for the corresponding gains or losses for the hedged items, and gains and losses realized subsequently are charged directly to income. If the hedged item ceases to exist due to its maturity, expiry, cancellation or exercise before the hedging instrument expired, deferred gains or losses are charged to income.</FONT> </div>
    <div align="justify"></div>
    <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></p>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">8</font></P>
      <hr size="3" noshade>
      <br>
    </div>
    <div align="justify">
      <div align="justify">
        <table width="99%"  border="0" cellspacing="0" cellpadding="0">
          <tr>
            <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
            <td width="54%" bgcolor="#000000"><blockquote>
                <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
            </blockquote></td>
          </tr>
        </table>
      </div>
      <font size="2" face="Times New Roman, Times, serif"></font></div>
    <div align="justify"> <br>
        <br>
        <font size="2" face="Times New Roman, Times, serif"><strong>3. Significant accounting policies (continued):</strong><br>
        <br>
  (b) Hedging relationships (continued): <br>
        </font><FONT size="2" FACE="Times New Roman, Times, serif">Gains and losses on forward foreign exchange contracts are recognized through income and generally offset transaction losses or gains on the foreign currency cash flows, which they are intended to hedge. Gains and losses on swap arrangements are recognized and charged to income on a basis that corresponds with changes in the related underlying item.</FONT> <br>
        <br>
    </div>
    <div align="justify">
      <p><font size="2" face="Times New Roman, Times, serif">(c) Investment in joint venture: <br>
      </font><FONT size="2" FACE="Times New Roman, Times, serif">During the first quarter of fiscal 2004, the Company invested in a 50%/50% owned joint venture with Frontier Spinning Mills, Inc. The new joint venture company acquired the equipment and real estate of an existing yarn-spinning facility in Cedartown, Georgia. The total cost of the acquisition, including Frontier&#146;s 50% share in the investment, amounted to $12.5 million. The joint venture is accounted for using the proportionate consolidated method whereby the Company&#146;s proportionate share of revenues, expenses, assets and liabilities is included in these financial statements. The Company&#146;s 50% proportionate interest in its joint venture did not have a material impact on the consolidated balance sheet, statements of earnings and cash flows.</FONT> </p>
      <p><font size="2" face="Times New Roman, Times, serif"><strong>4. Share capital:</strong></font></p>
    </div>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="3"></TH>
        <TH COLSPAN="2"></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif"><U>April 4, 2004</U></font></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif"><U>October 5, 2003</U></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif"><U>March 30, 2003</U></font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="5" ALIGN="RIGHT"></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">(audited)</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD colspan="4" ALIGN="RIGHT"></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="left"><font size="2" face="Times New Roman, Times, serif">Shares </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"></TD>
        <TD ALIGN="LEFT"><div align="left"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="left"><font size="2" face="Times New Roman, Times, serif">Shares </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><div align="left"><font size="2" face="Times New Roman, Times, serif">Shares </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="17" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="48%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Authorized without limit as to number and without par value:</font></TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
        <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
        <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
        <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="1%" ALIGN="RIGHT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="RIGHT"></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First preferred shares, issuable in series, non-voting</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Second preferred shares, issuable in series, non-voting</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Class A subordinated voting shares, participating, one</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vote per share</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Class B multiple voting shares, participating, eight votes</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;per share</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="17" ALIGN="LEFT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issued and outstanding:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Class A subordinate voting shares:</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total outstanding, beginning of period</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">23,426</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 72,023</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">22,827</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 67,536</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">22,827</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 67,536</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Conversion of Class B shares into Class A shares (b)</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,094</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,467</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued under employee share purchase plan</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">85</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">127</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">61</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued pursuant to exercise of stock options</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">104</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,437</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">594</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4,360</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">394</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2,247</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="17" ALIGN="LEFT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total outstanding, end of period</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,627</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">77,012</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">23,426</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">72,023</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">23,224</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">69,844</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Class B multiple voting shares, beginning of period</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,094</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,467</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,094</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,467</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,094</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,467</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Conversion of Class B shares into Class A shares (b)</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(6,094</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(3,467</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&#8212;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="17" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,627</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 77,012</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,520</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 75,490</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,318</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> 73,311</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="17" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
    </TABLE>
    <P ALIGN="justify"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2">(a) On December 3, 2003, the Board of Directors approved the renewal of the stock repurchase program authorizing the Company to purchase up to a maximum of 200,000 of the Company&#146;s Class A subordinate voting shares in the open market commencing December 22, 2003 and ending December 21, 2004. As at April 4, 2004 no shares have been repurchased under this plan.</FONT></FONT> </P>
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
    <P ALIGN="justify"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2">(b) On March 1, 2004, the holders of the Class B multiple voting shares converted all the issued and outstanding shares into Class A subordinate voting shares on a one-for-one basis without any cash or non-cash consideration.</FONT></FONT> </P>
    <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
    <P ALIGN="justify"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2"><B>5. Earnings per share:</B></FONT></FONT></P>
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
    <P ALIGN="justify"><FONT FACE="Times New Roman, Times, Serif"><FONT SIZE="2">The following table sets forth the computation of basic and diluted earnings per share:</FONT></FONT> </P>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U></font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>2004</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>2003</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>2004</U></font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>2003</U></font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="62%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic weighted average number of common shares outstanding</font></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="6%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,576</font></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="6%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,160</font></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="6%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,550</font></TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="6%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,053</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic earnings per share</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.48</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.46</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.59</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted earnings per share:</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic weighted average number of common shares outstanding</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,576</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,160</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,550</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,053</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Plus impact of stock options</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">290</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">555</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">279</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">605</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted common shares</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,866</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,715</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,829</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,658</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Diluted earnings per share</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.48</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.45</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.58</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
      </TR>
    </TABLE>
    <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></p>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">9</font></P>
      <hr size="3" noshade>
      <br>
    </div>
    <div align="justify">
      <div align="justify">
        <table width="99%"  border="0" cellspacing="0" cellpadding="0">
          <tr>
            <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
            <td width="54%" bgcolor="#000000"><blockquote>
                <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
            </blockquote></td>
          </tr>
        </table>
      </div>
      <font size="2" face="Times New Roman, Times, serif"></font></div>
    <div align="justify"> <br>
        <font size="2" face="Times New Roman, Times, serif"><strong> <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
        </font> </strong></font>
        <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>6. Guarantees:</B></FONT></P>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font>
        <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Significant guarantees that have been provided to third parties are the following:</FONT> </P>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush In 1" -->
        </font>
        <div align="justify">
          <TABLE WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
            <TR VALIGN="TOP">
              <TD WIDTH="3%">&nbsp;</TD>
              <TD><P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company, including certain of its subsidiaries, have granted irrevocable standby letters of credit and surety bonds, issued by highly rated financial institutions, to third parties to indemnify them in the event the Company does not perform its contractual obligations. As at April 4, 2004, the maximum potential liability under these guarantees was $12.4 million of which $10.9 million was surety bonds and $1.5 million was for standby letters of credit. The standby letters of credit mature at various dates during 2004 and the surety bonds are automatically renewed on an annual basis.</FONT> </P></TD>
            </TR>
          </TABLE>
          <font size="2" face="Times New Roman, Times, serif"><BR>
          <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font></div>
        <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">As at April 4, 2004, the Company has not recorded a liability with respect to these guarantees, as the Company does not expect to make any payments in excess of what is recorded on the Company&#146;s financial statements for the aforementioned items.</FONT> </P>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
        </font>
        <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>7. Financial instruments:</B></FONT></P>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font>
        <P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The following table summarizes the Company&#146;s commitments to buy and sell foreign currencies as at April 4, 2004 and March 30, 2003:</FONT> </P>
    </div>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="4" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">Notional amount</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Exchange rate</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">Maturity</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">Notional U.S. equivalent</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="12" ALIGN="LEFT"><hr size="1" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">2004:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="29%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sell contracts:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="12%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="16%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="16%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="5%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="9%" ALIGN="RIGHT"></TD>
        <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange contracts</font></TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Euro/US</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&euro;10,020</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">1.1740 to 1.2752</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">April to December 2004</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$12,127</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;GBP/US</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&pound;&nbsp;&nbsp;5,154</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">1.6660 to 1.8500</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">April to December 2004</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;8,806</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Buy contracts:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange contracts</font></TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">CAD/US</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">CAD$ 35,150</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">1.2999 to 1.3475</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">April to September 2004</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$26,785</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">2003:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sell contracts:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange contracts</font></TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Euro/US</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&euro;&nbsp;&nbsp;8,854</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">1.0720 to 1.0798</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">March to November 2003</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;9,524</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Buy contracts:</font></TD>
        <TD colspan="2" ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange contracts</font></TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Euro/CAD</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&euro;&nbsp;&nbsp;1,619</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">1.5723 to 1.5761</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="2" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">May to August 2003</font></TD>
        <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;1,741</font></TD>
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">*</font></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="12" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
    </TABLE>
    <p><font size="2" face="Times New Roman, Times, serif">* Exchange rate as at March 30, 2003 was used to translate amount to U.S. dollars</font></p>
    <P ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">In addition, as at March 30, 2003 the Company had commitments to buy U.S. $9.2 million and sell U.S. $35.5 million for CAD $13.5 million and CAD $52.9 million respectively. These contracts matured by August 2003.
          <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
    </font></P>
    <P ALIGN="LEFT"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>8. Segmented information:</B></FONT></P>
    <font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font>
    <P ALIGN="LEFT"><FONT size="2" FACE="Times New Roman, Times, serif">The Company manufactures and sells activewear apparel. The Company operates in one business segment.</FONT> </P>
    <font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font>
    <P ALIGN="LEFT"><FONT size="2" FACE="Times New Roman, Times, serif">Individual customers accounting for greater than 10% of total sales are as follows:</FONT> </P>
    <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
      <TR VALIGN="BOTTOM">
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH COLSPAN="2"></TH>
        <TH></TH>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="LEFT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD colspan="3" ALIGN="LEFT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                  <U>2004</U></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                  <U>2003</U> </font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                  <U>2004</U></font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                  <U>2003</U> </font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD WIDTH="22%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Company A</font></TD>
        <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">30.2 %</font></div></TD>
        <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">11.5 %</font></div></TD>
        <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">27.4 %</font></div></TD>
        <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
        <TD WIDTH="13%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">11.8 %</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Company B</font></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">14.8 %</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></div></TD>
        <TD ALIGN="LEFT">&nbsp;</TD>
        <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">14.7 %</font></div></TD>
      </TR>
      <TR VALIGN="BOTTOM">
        <TD colspan="9" ALIGN="LEFT"><hr size="2" noshade></TD>
      </TR>
    </TABLE>
    <font size="2" face="Times New Roman, Times, serif"><br>
During September 2003, Company A acquired Company B. </font>
    <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
    </font></p>
    <div align="justify">
      <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">10</font></P>
      <hr size="3" noshade>
      <br>
    </div>
    <div align="justify">
      <div align="justify">
        <table width="99%"  border="0" cellspacing="0" cellpadding="0">
          <tr>
            <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
            <td width="54%" bgcolor="#000000"><blockquote>
                <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
            </blockquote></td>
          </tr>
        </table>
      </div>
      <font size="2" face="Times New Roman, Times, serif"></font></div>
    <div align="justify"> <br>
        <font size="2" face="Times New Roman, Times, serif"><strong> <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
        </font> </strong></font>
        <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>8. Segmented information (continued):</B></FONT></P>
        <font size="2" face="Times New Roman, Times, serif">
        <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font> <FONT size="2" FACE="Times New Roman, Times, serif">Sales were derived from customers located in the following geographic areas: <br>
        <br>
        </FONT>
        <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
          <TR VALIGN="BOTTOM">
            <TH COLSPAN="2"></TH>
            <TH></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="4" ALIGN="LEFT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="4" ALIGN="LEFT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                      <U>2004</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                      <U>2003</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                      <U>2004</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                  <U>2003</U></font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD WIDTH="50%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">International</font></TD>
            <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="3%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">129,780 </font></div></TD>
            <TD WIDTH="5%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">102,851</font></TD>
            <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="2%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">201,280 </font></div></TD>
            <TD WIDTH="3%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="7%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">161,648</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Canada</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">11,589</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">10,764</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">18,048</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">16,967</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"> $</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">141,369</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">113,615</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">219,328</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">178,615</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
        </TABLE>
        <br>
        <font size="2" face="Times New Roman, Times, serif">Fixed assets by geographic areas are as follows: <br>
        <br>
        </font>
        <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
          <TR VALIGN="BOTTOM">
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4, 2004</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>October 5, 2003</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30, 2003</U></font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(audited)</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD WIDTH="51%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Canada</font></TD>
            <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="12%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;89,596</font></TD>
            <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="12%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;93,247</font></TD>
            <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="10%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;90,341</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Caribbean basin, Central America and Mexico</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">81,701</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">68,570</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">47,883</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">United States</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">24,280</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">18,532</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">16,810</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;195,577</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;180,349</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;155,034</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
        </TABLE>
        <font size="2" face="Times New Roman, Times, serif"><strong>9. Other information: </strong><br>
        <br>
  (a) The following items were included in the determination of the Company's net earnings:<br>
        </font>
        <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
          <TR VALIGN="BOTTOM">
            <TH COLSPAN="2"></TH>
            <TH></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="4" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="3" ALIGN="LEFT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                  <U>2004</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                      <U>2003</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                      <U>2004</U></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                      <U>2003</U></font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD WIDTH="45%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Depreciation of fixed assets</font></TD>
            <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="3%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5,075</font></TD>
            <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="3%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
            <TD WIDTH="9%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">3,563</font></div></TD>
            <TD WIDTH="4%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">9,830 </font></div></TD>
            <TD WIDTH="5%" ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD WIDTH="8%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6,818</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Interest expense on long-term debt</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,817</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">1,832</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">3,406</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,277</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Foreign exchange (gain) loss</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(11</font></TD>
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">)</font></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">953</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">750</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">360</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Amortization of deferred charges</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">174</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">141</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">351</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">382</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="11" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
        </TABLE>
        <font size="2" face="Times New Roman, Times, serif"><br>
  (b) Supplemental cash flow disclosure: <br>
  <br>
        </font>
        <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
          <TR VALIGN="BOTTOM">
            <TH COLSPAN="2"></TH>
            <TH></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Three months ended</strong></font></div></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD colspan="3" ALIGN="RIGHT" bgcolor="#66CCFF"><div align="center"><font size="2" face="Times New Roman, Times, serif"><strong>Six months ended</strong></font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                  <U>2004</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                  <U>2003</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4,</U><br>
                  <U>2004</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif"><U>March 30,</U><br>
                      <U>2003</U></font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="10" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD WIDTH="43%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash paid during the period for:</font></TD>
            <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="5%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="9%" ALIGN="RIGHT"></TD>
            <TD WIDTH="6%" ALIGN="LEFT"><div align="right"></div></TD>
            <TD WIDTH="8%" ALIGN="RIGHT"></TD>
            <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="7%" ALIGN="RIGHT"></TD>
            <TD WIDTH="6%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="8%" ALIGN="LEFT">&nbsp;</TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,751</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1,747</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3,330</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">3,291</font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT"><div align="right"></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">704</font></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">$</font></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">486</font></TD>
            <TD ALIGN="LEFT"><div align="right"></div></TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">790</font></TD>
            <TD ALIGN="LEFT"><div align="right"></div></TD>
            <TD ALIGN="LEFT"><div align="right"><font size="2" face="Times New Roman, Times, serif">585 </font></div></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="10" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
        </TABLE>
        <P ALIGN="LEFT">&nbsp;</P>
        <TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
          <TR VALIGN="BOTTOM">
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH COLSPAN="2"></TH>
            <TH></TH>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>April 4, 2004</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>October 5, 2003</U></font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"><U>March 30, 2003</U></font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">(audited)</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&nbsp;</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD WIDTH="54%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Non-cash transactions:</font></TD>
            <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="12%" ALIGN="RIGHT"></TD>
            <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="13%" ALIGN="RIGHT"></TD>
            <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
            <TD WIDTH="13%" ALIGN="RIGHT"></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additions of fixed assets included in accounts payable</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;895</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,348</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1,629</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Cash and cash equivalents consist of:</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&nbsp;</TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash balances with banks</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21,413</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;50,672</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22,995</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Short-term investments</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&#8212;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">18,668</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT">&#8212;</TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21,413</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;69,340</font></TD>
            <TD ALIGN="LEFT">&nbsp;</TD>
            <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22,995</font></TD>
          </TR>
          <TR VALIGN="BOTTOM">
            <TD colspan="7" ALIGN="LEFT"><hr size="2" noshade></TD>
          </TR>
        </TABLE>
        <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
          <!-- MARKER FORMAT-SHEET="Para Flush" -->
        </font></p>
        <div align="justify">
          <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">11</font></P>
          <hr size="3" noshade>
          <br>
        </div>
        <div align="justify">
          <div align="justify">
            <table width="99%"  border="0" cellspacing="0" cellpadding="0">
              <tr>
                <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
                <td width="54%" bgcolor="#000000"><blockquote>
                    <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
                Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
              </font></p>
                </blockquote></td>
              </tr>
            </table>
          </div>
          <font size="2" face="Times New Roman, Times, serif"></font></div>
        <div align="justify"> <br>
            <font size="2" face="Times New Roman, Times, serif"><strong> <font size="2" face="Times New Roman, Times, serif">
            <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
            </font> </strong></font>
            <div align="justify"><font size="2" face="Times New Roman, Times, serif">
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            </font> </div>
            <FONT SIZE="2" face="Times New Roman, Times, serif"><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</B></FONT> <FONT SIZE="2" face="Times New Roman, Times, serif"><B><br>
SECOND QUARTER ENDED APRIL 4, 2004</B></FONT>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The following discussion and analysis should be read in conjunction with the unaudited consolidated financial statements and notes thereto for the six months ended April 4, 2004, with Management&#146;s Discussion and Analysis of the Financial Position and Results of Operations (&#147;MD&amp;A&#148;) in the fiscal 2003 Annual Report, including the section on the risks and uncertainties.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company&#146;s accounting policies are in accordance with Canadian generally accepted accounting principles (&#147;GAAP&#148;). These differ in some respects from GAAP in the United States (&#147;US GAAP&#148;). The Company&#146;s financial results are reconciled to US GAAP at the end of its fiscal year in its Annual Report.</FONT> </div>
<div align="justify"><br>
    <FONT SIZE="2" face="Times New Roman, Times, serif"><B>CORPORATE OVERVIEW</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Gildan Activewear Inc. is a vertically integrated manufacturer and marketer of premium quality branded basic activewear for sale principally in the wholesale imprinted activewear segment of the Canadian, U.S., European, and other international markets. Our Company manufactures and sells premium quality 100% cotton and 50% cotton/50% polyester T-shirts, sport shirts and sweatshirts in a variety of weights, sizes, colours and styles. We sell our products as blanks, which are ultimately decorated with designs and logos for sale to consumers. Gildan&#146;s corporate head office is located in Montreal, Canada, and over 9,300 full-time employees work in our facilities worldwide. Our shares are listed on the New York Stock Exchange (GIL) and the Toronto Stock Exchange (GIL.A).</FONT> </P>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>RECENT DEVELOPMENTS</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">All financial information contained herein is expressed in U.S. dollars unless otherwise stated. Historically, the financial information of the Company has been measured and reported in Canadian dollars. However, effective October 6, 2003, the Company adopted the U.S. dollar as its functional currency since a significant portion of revenues, expenses, assets and liabilities are denominated in U.S. dollars and the Company&#146;s sales and manufacturing operations are increasingly international in scope. Effective the same date, the U.S. dollar was adopted as the Company&#146;s reporting currency. The Company will continue to report its results in accordance with Canadian GAAP. Historical financial information in U.S. dollars has been provided in the Investor Relations section of the Company&#146;s Web Site, which can be accessed at <U>www.gildan.com.</U></FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">When there is such a change in reporting currency, Canadian and U.S. accounting standards require that prior year comparative financial statements be presented in U.S. dollars, using a translation method that retains the Canadian dollar as the currency of measurement, as described in Note 2 to the interim consolidated financial statements. The application of this method at the beginning of fiscal 2004 involved translating all assets and liabilities using the exchange rate in effect at the end of fiscal 2003. This resulted in a translated value for opening inventories and fixed assets that was approximately $23 million higher than the amount that would have resulted from the application of exchange rates prevailing at the dates these assets were manufactured or acquired. This upward revaluation of inventories and fixed assets has been reflected directly in opening shareholders&#146; equity as part of the $26.2 million positive balance of
 cumulative translation adjustments. These increases will have a corresponding offsetting negative impact on earnings as these inventories are consumed and fixed assets are depreciated. We have quantified the impact of these higher expenses for the second quarter of fiscal 2004 as part of our discussion and analysis of gross margins, depreciation expense and earnings per share below.</FONT> </div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  <br>
  <br>
  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>RESULTS OF OPERATIONS<br>
  Sales</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Sales for the three months ended April 4, 2004 were $141.4&nbsp;million, up 24.5% from $113.6&nbsp;million for the three months ended March&nbsp;30, 2003. Unit sales for the second quarter were 7.6 million dozens, up 24.6% from last year. Sales for the six months ended April 4, 2004 were $219.3&nbsp;million compared to $178.6&nbsp;million for the six months ended March 30, 2003, representing an increase of 22.8%. The increase in sales for the three-month and the six-month periods were due to an increase in unit shipments combined with a higher valued product mix, partially offset by lower selling prices.</FONT> </P>
<div align="justify">
  <p><font size="2" face="Times New Roman, Times, serif">During the quarter ended March 31, 2004, U.S.1 industry shipments of T-shirts from distributors </font></p>
  <p><font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Scotch Line Single" -->
  </font> </p>
</div>
<HR ALIGN=left WIDTH=40% SIZE=1 NOSHADE>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
</font><FONT SIZE="2" face="Times New Roman, Times, serif"><SUP>1</SUP> Source: S.T.A.R.S. Report, AC Nielsen Market Decisions</FONT></div>
<div align="justify">
  <p>&nbsp;</p>
  <p><font size="2" face="Times New Roman, Times, serif">
    <!-- MARKER FORMAT-SHEET="Para Flush" -->
  </font></p>
  <div align="justify">
    <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">12</font></P>
    <hr size="3" noshade>
    <br>
  </div>
  <div align="justify">
    <div align="justify">
      <table width="99%"  border="0" cellspacing="0" cellpadding="0">
        <tr>
          <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
          <td width="54%" bgcolor="#000000"><blockquote>
              <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
                Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
              </font></p>
          </blockquote></td>
        </tr>
      </table>
    </div>
    <font size="2" face="Times New Roman, Times, serif"></font></div>
  <div align="justify"> </div>
  <p><FONT size="2" FACE="Times New Roman, Times, serif">to screen-printers increased by 11.6%, sport shirt shipments increased by 1.1%, and fleece shipments increased 13.8% compared with the second quarter last year. Sales of Gildan T-shirts by distributors grew by 30.3%, while sales of Gildan sport shirts and fleece products increased by 34.7% and 39.2% respectively.</FONT> </p>
</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Gildan continued to increase market share in all market segments, compared to the second quarter of fiscal 2003. The Company further increased its market leadership position in the overall T-shirt category, with a share of 31.2%, versus 29.1% a year ago. Gildan continued to achieve significant penetration in the sport shirt segment, where its share increased to 24.4% from 18.4% in the second quarter of last year. Also, Gildan&#146;s share in the fleece category increased to 14.3%, compared with 10.7% a year ago.</FONT> </div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif"><br>
  All U.S. market and market share data for the U.S. wholesale distributor channel is based on the S.T.A.R.S. report by ACNielsen Market Decisions. With effect from the beginning of calendar 2004, the Company's largest customer has decided to discontinue its participation in the S.T.A.R.S. report.
      <!-- MARKER FORMAT-SHEET="Para Flush" -->
</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company continued to expand its European business and maintained its leading market share position in Canada. Gildan&#146;s unit shipments in Europe increased by 38.9% over the second quarter last year, and shipments in Canada were up by 10.2%. Selling prices in the Canadian market were negatively impacted as a result of the lower landed selling prices for U.S. competitors in the Canadian market, due to the decline in the relative value of the U.S. dollar.</FONT> </P>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
</font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>Gross Margins</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Gross margins were 26.6% compared to 29.6% in the second quarter of fiscal 2003. Gross margins for the six months ended April 4, 2004 were $58.6 million or 26.7% compared to $52.7&nbsp;million or 29.5% for the same period of the prior year. Gross margins decreased by $1.1 million in the quarter and by $3.3 million for the six months ended April 4, 2004 due to the impact of change in functional currency, as opening inventories were consumed. Gross margins, excluding the impact of the adjustments due to the change in functional currency, were 27.3% for the three months ended April 4, 2004 and 28.2% for the six months ended April 4, 2004 versus 29.6% and 29.5% for the same periods last year.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The decline in gross margin was primarily the result of increases in raw material costs and lower overall selling prices, partially offset by a higher-valued product mix, improved manufacturing efficiencies, and the non-recurrence of a special charge relative to the closure of the Montreal sewing plant in fiscal 2003. The Company continues to realize reductions in manufacturing, duty and transportation costs from its investment in the Rio Nance textile facility in Honduras.</FONT> </div>
<div align="justify"><br>
    <FONT SIZE="2" face="Times New Roman, Times, serif"><B>Selling, General and Administrative Expenses</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Selling, general and administrative expenses were $15.2&nbsp;million or 10.7% of sales for the second quarter of fiscal 2004 compared to $13.5&nbsp;million or 11.9% of sales in the second quarter of fiscal 2003. For the six-month period ended April 4, 2004, selling, general and administrative expenses were $26.5&nbsp;million or 12.1 % of sales compared to $23.6&nbsp;million or 13.2% of sales in the same period of fiscal 2003.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The increase in the dollar amount of selling, general and administrative expenses is the result of higher volume-related distribution costs combined with an increase in directors and officers liability insurance premiums. The Company expects that for fiscal 2004, selling, general and administrative expenses will be at a similar level as a percentage of sales as fiscal 2003.</FONT> </div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  <br>
  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>Depreciation and Interest Expenses</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Para Flush" -->
</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Depreciation and amortization expenses were $5.2&nbsp;million in the second quarter of fiscal 2004 compared to $3.7&nbsp;million in the second quarter of fiscal 2003. For the six-month period, depreciation and amortization expenses were $10.2&nbsp;million in fiscal 2004 compared to $7.2&nbsp;million in fiscal 2003. The increase is the result of the Company&#146;s continued investment in capital expenditures to provide for long-term sales growth. Approximately $0.9 million of the increase for the six months ended April 4, 2004 was caused by the change in functional currency, as a portion of the upward revaluation of opening fixed assets was depreciated during the period.</FONT> </P>
<div align="justify">
  <p><FONT size="2" FACE="Times New Roman, Times, serif">Interest expense has increased to $1.8 million in the second quarter of fiscal 2004 from $1.7 million in the second quarter of fiscal 2003. For the six-month period, interest expense was $3.3&nbsp;million in fiscal 2004 compared to $3.2&nbsp;million in fiscal 2003. The increase is the result of the Company&#146;s share of interest on long-term debt undertaken by the Company&#146;s joint venture.</FONT> </p>
  <p>&nbsp;</p>
  <p align="left"><font size="2" face="Times New Roman, Times, serif"> </font><font size="2" face="Times New Roman, Times, serif">
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  </font></p>
  <div align="justify">
    <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">12</font></P>
    <hr size="3" noshade>
    <br>
  </div>
  <div align="justify">
    <div align="justify">
      <table width="99%"  border="0" cellspacing="0" cellpadding="0">
        <tr>
          <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
          <td width="54%" bgcolor="#000000"><blockquote>
              <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
                Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
              </font></p>
          </blockquote></td>
        </tr>
      </table>
    </div>
    <font size="2" face="Times New Roman, Times, serif"></font></div>
  <div align="justify"> <br>
      <font size="2" face="Times New Roman, Times, serif"><strong> <font size="2" face="Times New Roman, Times, serif">
      <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
      </font> </strong></font>
      <P ALIGN="justify"> <FONT SIZE="2" face="Times New Roman, Times, serif"><B>Net Earnings</B></FONT></P>
  </div>
</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Net earnings were $14.3&nbsp;million or $0.48 per share on a diluted basis in the second quarter of fiscal 2004, up respectively $0.9 million and 6.7% from $13.4&nbsp;million or $0.45 per diluted share in the second quarter of fiscal 2003. The increase in net earnings was the result of a 24.6% increase in unit sales with an improved product mix, partially offset by reduced gross margins and an increase in selling, general, administration and depreciation expenses. Excluding the impact of the change to U.S. dollar functional currency outlined above, net earnings were $15.9 or $0.53 per share on a diluted basis, an increase of $1.8 million and 10.4% over earnings and diluted earning per share before the special charge in the second quarter of fiscal 2003.</FONT> <br>
  <br>
</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">For the six-month period ended April 4, 2004, net earnings were $17.2&nbsp;million or $0.58 per diluted share compared with $17.1&nbsp;million or $0.58 per diluted share in the same period of last year. Net earnings before the impact of the U.S. dollar functional currency change were $21.4&nbsp;million or $0.72 per diluted share, up respectively $3.6&nbsp;million and 18.0% from the first six months of fiscal 2003, before the special charge for the sewing plant closure. </FONT> </div>
<div align="justify"><br>
    <FONT SIZE="2" face="Times New Roman, Times, serif"><B>Quarterly Results</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The following table sets forth certain summarized unaudited quarterly financial and other data for the periods presented. The financial data has been derived from unaudited financial statements that, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of such quarterly data. The Company&#146;s revenues and income are subject to seasonal variations. Consequently, the results of operations for any quarter are not necessarily indicative of the results to be expected for any future period.</FONT> </P>
<P ALIGN="justify"><font size="2" face="Times New Roman, Times, serif"><strong>Fiscal 2004</strong></font> </P>
<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
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    <TH COLSPAN="2"></TH>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">(in millions, except per share data)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q1 2004</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q2 2004</font></div></TD>
  </TR>
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    <TD colspan="5" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD WIDTH="60%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sales</font></TD>
    <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="15%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;78.0</font></TD>
    <TD WIDTH="4%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="15%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;141.4</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Unit sales (Dozen)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4.0</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">7.6</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.10</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.48</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.10</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.48</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total assets</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">427,329</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">448,881</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total long-term financial liabilities</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">79,923</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">81,224</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="5" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Weighted average # of shares outstanding (in thousands)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="5" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,524</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,576</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,792</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,866</font></TD>
  </TR>
</TABLE>
<font size="2" face="Times New Roman, Times, serif"><br>
<strong>Fiscal 2003 </strong></font>
<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
  <TR VALIGN="BOTTOM">
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH></TH>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">(in millions, except per share data)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q1 2003</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q2 2003</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q3 2003</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q4 2003</font></div></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD WIDTH="46%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sales</font></TD>
    <TD WIDTH="1%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="14%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;65.0</font></TD>
    <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="10%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;113.6</font></TD>
    <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="11%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;143.4</font></TD>
    <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="11%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 109.2</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Unit sales (Dozen)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">3.3</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6.1</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">7.4</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5.8</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.4</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.8</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.13</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.46</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.74</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.48</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.13</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.45</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.73</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.48</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total assets</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">322,551</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">356,878</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">409,435</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">429,664</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total long-term financial liabilities</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">85,392</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">87,484</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">73,803</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">74,793</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Weighted average # of shares outstanding (in thousands)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,945</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,160</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,373</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,478</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,600</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,715</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,768</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,808</font></TD>
  </TR>
</TABLE>
<font size="2" face="Times New Roman, Times, serif"><br>
<strong>Fiscal 2002</strong></font>
<TABLE CELLPADDING="0" CELLSPACING="0" BORDER="0" WIDTH="95%">
  <TR VALIGN="BOTTOM">
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH COLSPAN="2"></TH>
    <TH></TH>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">(in millions, except per share data)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q1 2002</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q2 2002</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q3 2002</font></div></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Q4 2002</font></div></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD WIDTH="46%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Sales</font></TD>
    <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="13%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;55.7</font></TD>
    <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="10%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;98.1</font></TD>
    <TD WIDTH="2%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="12%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;125.2</font></TD>
    <TD WIDTH="3%" ALIGN="LEFT">&nbsp;</TD>
    <TD WIDTH="10%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif"> $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;103.3</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Unit sales (Dozen)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2.7</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5.0</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">6.4</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">5.3</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Net earnings</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.7</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.7</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.06</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.36</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.62</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.44</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted EPS</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.06</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.35</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.60</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.43</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total assets</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">298,234</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">307,58</font><font size="2" face="Times New Roman, Times, serif">9</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">313,</font><font size="2" face="Times New Roman, Times, serif">641</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">315,266</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total long-term financial liabilities</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">115,004</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">113,536</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">88,912</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">85,858</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Weighted average # of shares outstanding (in thousands)</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD colspan="9" ALIGN="LEFT"><hr size="1" noshade></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Basic</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,208</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,381</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,570</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">28,807</font></TD>
  </TR>
  <TR VALIGN="BOTTOM">
    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Diluted</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,098</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,298</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,510</font></TD>
    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">29,540</font></TD>
  </TR>
</TABLE>
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            <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
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</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">As at April 4, 2004, accounts receivable totaled $85.4&nbsp;million compared to $64.3 million at October 5, 2003 and $70.2&nbsp;million in the second quarter of the prior year. The increase in receivables compared with October 5, 2003 was due to higher sales. The increase in accounts receivable from the second quarter of fiscal 2003 is due to an increase of sales of $27.8 million for the quarter. Days&#146; sales outstanding on trade accounts receivable decreased from 48 days in the second quarter of fiscal 2003 to 45 days in the current quarter. Inventories increased by $26.6&nbsp;million from $103.5&nbsp;million at October 5, 2003 to $130.1&nbsp;million in the second quarter of fiscal 2004. The Company traditionally builds up inventory levels in the first quarter to meet peak sales demand in the summer. Inventory levels have increased by $32.5&nbsp;million from the prior year to service anticipated growth in demand for the Company&#14
6;s products. However, the increase in inventory is below the Company&#146;s original plan due to the higher than expected unit sales volume for the first six months of fiscal 2004.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Capital expenditures in the second quarter amounted to $10.5 million, primarily for the Dominican Republic and the Rio Nance projects. In the second quarter of fiscal 2003, the Company invested $9.5 million in fixed assets. Year-to-date, the Company invested $26.6&nbsp;million in fixed assets and it now anticipates that capital expenditures for the full year will be approximately $65 million. The major projects include the new textile facility in the Dominican Republic, to be operational in fiscal 2005, the expansion of the Rio Nance textile facility and the addition of a new sewing facility in Nicaragua.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Total assets were $448.9&nbsp;million at April 4, 2004 compared to $429.7&nbsp;million at October 5, 2003 and $356.9&nbsp;million at March&nbsp;30, 2003. Working capital was $165.3 million at the end of the second quarter of fiscal 2004 compared to $155.0&nbsp;million at October&nbsp;5, 2003 and $134.1&nbsp;million at March 30, 2003.</FONT> </div>
<div align="justify"><br>
    <br>
    <FONT SIZE="2" face="Times New Roman, Times, serif"><B>FINANCING AND CAPITAL RESOURCES</B></FONT></div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">For the quarter ended April 4, 2004, cash flow from operating activities, including changes in non-cash working capital, was a use of cash of $6.2 million compared with a use of cash of $7.5&nbsp;million during the same period last year. Year-to-date, use of cash from operating activities was $25.9 million compared with a use of cash of $1.7&nbsp;million during the same period last year. The increase in use of cash was the result of increases in non-cash working capital items.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company ended the second quarter with a cash balance of $21.4 million and intends to use $17.5 million of its cash balances to satisfy its first scheduled principal repayment of its senior notes.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Total indebtedness at April 4, 2004 amounted to $76.1&nbsp;million compared to $73.6&nbsp;million at October 5, 2003 and $75.3&nbsp;million at March&nbsp;30, 2003. At the end of the second quarter, none of the Company&#146;s $150.0&nbsp;million CAD revolving bank facility was utilized.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In the normal course of business, the Company enters into contractual obligations that will require it to disburse cash over future periods. The following tables sets forth the Company&#146;s contractual obligations for the following items as at April 4, 2004:</FONT> </div>
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<P align="justify"><font size="2" face="Times New Roman, Times, serif">&nbsp; &nbsp; </font> </P>
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    <TD ALIGN="LEFT">&nbsp;</TD>
    <TD colspan="5" ALIGN="LEFT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Payments Due by Period</font></div></TD>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif"> (in millions)</font></TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Total</font></div></TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Balance of <br>
        Fiscal 2004</font></div></TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Fiscal <br>
        2005-2006</font></div></TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">Fiscal</font><br>
            <font size="2" face="Times New Roman, Times, serif">2007-2008</font> </div></TD>
    <TD ALIGN="RIGHT"><div align="center"><font size="2" face="Times New Roman, Times, serif">After&nbsp;<br>
        Fiscal 2008</font></div></TD>
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    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
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    <TD ALIGN="RIGHT">&nbsp;</TD>
    <TD ALIGN="RIGHT">&nbsp;</TD>
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    <TD WIDTH="37%" ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Long Term Debt</font></TD>
    <TD WIDTH="16%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;75.6</font></TD>
    <TD WIDTH="13%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.1</font></TD>
    <TD WIDTH="11%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;37.6</font></TD>
    <TD WIDTH="11%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;19.5</font></TD>
    <TD WIDTH="12%" ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.4</font></TD>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Capital Lease Obligations</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.5</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.2</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">0.3</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
  </TR>
  <TR>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Operating Leases</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">10.7</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">1.5</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">4.4</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2.7</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">2.1</font></TD>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Purchase Obligations</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">83.9</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">69.3</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">14.6</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Other Long-Term Obligations</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">47.7</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">47.7</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">&#8212;</font></TD>
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    <TD ALIGN="LEFT"><font size="2" face="Times New Roman, Times, serif">Total Contractual Obligations</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;218.4</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;136.8</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;56.9</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;22.2</font></TD>
    <TD ALIGN="RIGHT"><font size="2" face="Times New Roman, Times, serif">$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5</font></TD>
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<P align="justify"><font size="2" face="Times New Roman, Times, serif">Management expects that cash flow from its operating earnings, together with its year-end cash balances and unutilized bank facilities, will be sufficient to meet any foreseeable cash needs for the balance of fiscal 2004.</font> </P>
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              <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
                Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
              </font></p>
          </blockquote></td>
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    </div>
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      <P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>OUTLOOK</B></FONT></P>
  </div>
</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The Company has previously indicated that it expected its diluted EPS for the full fiscal year 2004 to be in the range of U.S. $2.25 &#150; U.S. $2.30, up 25.7% &#151; 28.5% from fiscal 2003 before the adjustments due to the change to U.S. functional currency. After reflecting the adjustments resulting from the transition to U.S. functional currency, the Company&#146;s EPS guidance range for fiscal 2004 was U.S. $2.10 &#151; $2.15, up 17.3% &#151; 20.1% from fiscal 2003. This guidance was based on 15% projected growth in unit sales volumes and modest selling price increases to partially pass through the higher cost of cotton.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In the first and second fiscal quarters, the Company has achieved its EPS growth projections by offsetting higher than anticipated promotional activity and resulting lower selling prices with higher than projected unit sales volumes. In the second half of the year, and especially in the third fiscal quarter, the Company will not have sufficient capacity available to continue to exceed its previous projections for unit sales volume growth.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Based on its revised assessment and anticipated market conditions, the Company is revising its previous communicated forecast for diluted EPS to a range of U.S. $2.05 &#150; U.S. $2.15 per share before the U.S. functional currency adjustments, up approximately 15% &#151; 20% from fiscal 2003. This revised projection considers short-term capacity constraints and assumes the continuation of aggressive industry pricing. After taking account of the accounting changes from the transition to U.S. functional currency, the Company now expects to report diluted EPS for fiscal 2004 of U.S $1.90 &#151; $2.00, up 6% &#151; 12% from fiscal 2003, compared to its original guidance of U.S. $2.10 &#151; $2.15.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Going forward, the Company expects to achieve its objective of minimum 15% EPS growth beyond 2004, in addition to achieving 15% &#151; 20% EPS growth in the current fiscal year, even if industry pricing continues to decline. Gildan is slightly ahead of schedule with its timetable for construction of its Dominican Republic textile facility. As the Company brings this facility on stream, it expects to continue to lower its manufacturing costs and to have capacity available to further accelerate its market share penetration in the wholesale distributor channel in fiscal 2005, as well as to implement its plans to enter the retail channel.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">For a more detailed discussion of the Company&#146;s outlook, readers should review the outlook section of the fiscal 2003 MD&amp;A in the Annual Report, which is hereby incorporated by reference.</FONT> </div>
<div align="justify">
  <p><font size="2" face="Times New Roman, Times, serif"><B>CRITICAL ACCOUNTING POLICIES</B></font></p>
</div>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Several of our accounting policies involve significant judgments and uncertainties. The policies with the greatest potential effect on our results of operations and financial position include the estimate of collectability of accounts receivable and the recovery value of obsolete or overstocked inventory. For accounts receivable, we estimate the net collectability, considering both historical and anticipated trends of trade deductions and returns taken by our customers, allowances we provide to our customers and take various steps to mitigate the risk of credit loss, including obtaining partial credit insurance. For inventory, we estimate the amount of goods that we will not be able to sell in the normal course of business and write down the value of these goods to the recovery value expected to be realized. If we incorrectly anticipate these trends or unexpected events occur, our results of operations could be materially affected.</FON
T> </div>
<div align="justify">
  <p><FONT SIZE="2" face="Times New Roman, Times, serif"><B>CHANGES IN ACCOUNTING POLICIES</B></FONT></p>
</div>
<div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>Stock-Based Compensation and Other Stock-Based Payments</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In November 2003, the Canadian Institute of Chartered Accountants (&#147;CICA&#148;) revised Handbook Section 3870, with respect to the accounting for stock-based compensation and other stock-based payments. The revised recommendations require that beginning January 1, 2004, the fair value-based method be used to account for all transactions whereby goods and services are received in exchange for stock-based compensation and other stock-based payments. Under the fair value method, compensation cost is measured at fair value at the date of grant and is expensed over the award&#146;s vesting periods.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">During the second quarter of fiscal 2004, $184,000 (2003 &#150; nil) was expensed as compensation expense, with an offset to contributed surplus, due to the issuance of 60,000 Restricted Share Units and a modification to the vesting period of certain options.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In accordance with the transitional options permitted under Section 3870, the Company has elected to early adopt the new recommendations effective the commencement of our 2004 fiscal year and prospectively apply the standard for employee stock awards granted after October 6, 2003. There were no options granted during the three months and six months ended April 4, 2004. Previously, the Company applied the settlement method of accounting to employee stock options.</FONT> </P>
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  <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">16</font></P>
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        <td width="46%"><img src="mda_logo.jpg" width="131" height="70"></td>
        <td width="54%" bgcolor="#000000"><blockquote>
            <p><font color="#FFFFFF" size="3" face="Times New Roman, Times, serif"><strong> Quarterly Report to Shareholders<br>
              Second quarter ended April 4, 2004 </strong></font><font size="2" face="Times New Roman, Times, serif"><br>
            </font></p>
        </blockquote></td>
      </tr>
    </table>
  </div>
  <font size="2" face="Times New Roman, Times, serif"></font></div>
<div align="justify"> <br>
    <font size="2" face="Times New Roman, Times, serif"><strong> <font size="2" face="Times New Roman, Times, serif">
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      </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>RECENT ACCOUNTING PRONOUNCEMENTS</B></FONT></P>
</div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
  <!-- MARKER FORMAT-SHEET="Left Head Bold" -->
  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>Impairment of Long-Lived Assets</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In December 2002, the CICA issued Handbook section 3063, &#147;Impairment of Long-Lived Assets&#148;. Section 3063 provides accounting guidance for the determination of a long-lived asset impairment as well as recognition, measurement and disclosure of the impairment. This section was effective for the Company&#146;s 2004 fiscal year and has not had a material impact on its financial statements.</FONT> </P>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>Asset Retirement Obligations</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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</font> </div>
<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In March 2003, the CICA issued Handbook Section 3110, &#147;Asset Retirement Obligations&#148;. This section requires that the fair value of an asset retirement obligation be recorded as a liability only when there is a legal obligation associated with a removal activity. This section was effective for the Company&#146;s 2004 fiscal year and has not had a material impact on is financial statements.</FONT> </P>
<div align="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B>FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS</B></FONT></div>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">For a complete discussion of the risks and significant assumptions used in determining the fair value of the Company&#146;s financial instruments, please refer to Note 13 of our 2003 consolidated financial statements in the Annual Report, which is hereby incorporated by reference.</FONT> </P>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>BUSINESS RISKS</B></FONT></div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">In order to be successful, the Company must continuously be aware of global changes and risks affecting its markets and competitive environment. Risk areas include changes in international trade legislation and taxation, changes in cotton prices and currency fluctuations. For a more detailed discussion on potential business risks, readers should review the risks factors section of the Annual Information Form filed by the Company with the Canadian securities commissions and the Annual Report on Form 40-F filed with the U.S. Securities and Exchange Commission which are hereby incorporated by reference.</FONT> </P>
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  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>DISCLOSURE OF OUTSTANDING SHARE DATA</B></FONT></div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">As of April 30, 2004 there were 29,627,619 Class A subordinate shares issued and outstanding along with 679,635 options outstanding.</FONT> </P>
<div align="justify"><font size="2" face="Times New Roman, Times, serif">
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  </font><FONT SIZE="2" face="Times New Roman, Times, serif"><B>FORWARD-LOOKING STATEMENTS</B></FONT></div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Certain statements included in this management discussion and analysis may constitute &#147;forward-looking statements&#148; within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. We refer you to the Company&#146;s filings with the Canadian securities regulatory authorities and the U.S. Securities and Exchange Commission for a discussion of the various factors that may affect the Company&#146;s future results.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause the Company&#146;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.</FONT> </div>
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<P ALIGN="justify"><FONT size="2" FACE="Times New Roman, Times, serif">We believe that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Furthermore, the forward-looking statements contained in this report are made as of the date of this report, and we do not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. This cautionary statement expressly qualifies the forward-looking statements contained in this report.</FONT> </P>
<div align="justify"><FONT size="2" FACE="Times New Roman, Times, serif">The forward-looking statements contained in this report are expressly qualified by this cautionary statement.</FONT> <br>
  <br>
  <br>
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<div align="justify">
  <p><font size="2" face="Times New Roman, Times, serif">May 4, 2004 </font></p>
  <p>&nbsp;</p>
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    <P ALIGN="center"><font size="2" face="Times New Roman, Times, serif">17</font></P>
    <hr size="3" noshade>
    <p>&nbsp;</p>
  </div>
</div>
<P>
<P align=center><FONT face="Times New Roman, Times, serif"
size=3><STRONG>SIGNATURE</STRONG></FONT>
<P align=left>
<P align="left"><FONT face="Times New Roman, Times, serif"
size=3>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securitiecs Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.</FONT>
<P>
<P>
<P>
<DIV align=right>
  <TABLE cellSpacing=0 cellPadding=0 width="50%" border=0>
    <TR>
      <TD><STRONG><FONT face="Times New Roman, Times, serif" size=3>GILDAN ACTIVEWEAR INC. </FONT></STRONG></TD>
    </TR>
    <TR>
      <TD>&nbsp;</TD>
    </TR>
    <TR>
      <TD>&nbsp;</TD>
    </TR>
    <TR>
      <TD>&nbsp;</TD>
    </TR>
    <TR>
      <TD>(Signed) St&eacute;phane Lemay
          <HR noShade SIZE=1>
    </TR>
    <TR>
      <TD><FONT face="Times New Roman, Times, serif" size=3>St&eacute;phane Lemay </FONT></TD>
    </TR>
    <TR>
      <TD><FONT face="Times New Roman, Times, serif" size=3>Vice-President, Public and Legal Affairs </FONT></TD>
    </TR>
    <TR>
      <TD>&nbsp;</TD>
    </TR>
  </TABLE>
</DIV>
<P align="left">
<div align="left">
  <TABLE width="50%" border=0 cellPadding=0 cellSpacing=0>
    <TR>
      <TD><strong>Date</strong> June 1, 2004</TD>
    </TR>
    <TR>
      <TD>&nbsp;</TD>
    </TR>
  </TABLE>
</div>
<P>
<p align="left">&nbsp;</p>
<p align="left"><FONT color=#0000ff></FONT></p>
<p></p>
<p>&nbsp;</p>
<P ALIGN="justify"><FONT SIZE="2" face="Times New Roman, Times, serif"><B></B></FONT></P>
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        <P ALIGN="LEFT"> <FONT size="2" FACE="Times New Roman, Times, serif"> </FONT> </P>
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    <P ALIGN="justify">&nbsp;    </P>
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