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<SEC-DOCUMENT>0001204459-08-000268.txt : 20080211
<SEC-HEADER>0001204459-08-000268.hdr.sgml : 20080211
<ACCEPTANCE-DATETIME>20080211170426
ACCESSION NUMBER:		0001204459-08-000268
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20071230
FILED AS OF DATE:		20080211
DATE AS OF CHANGE:		20080211

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:		08594375

	BUSINESS ADDRESS:	
		STREET 1:		725 MONT?E DE LIESSE
		STREET 2:		MONTREAL
		CITY:			CANADA
		STATE:			A8
		ZIP:			H4T 1P5
		BUSINESS PHONE:		5147352023

	MAIL ADDRESS:	
		STREET 1:		725 MONT?E DE LIESSE
		STREET 2:		MONTREAL
		CITY:			CANADA
		STATE:			A8
		ZIP:			H4T 1P5

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GILDAN ACTIVEWEAR INC
		DATE OF NAME CHANGE:	19980515
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>gildan6k.htm
<DESCRIPTION>FORM 6-K
<TEXT>

<head>
<title>Gildan Activewear Inc. - Form 6-K - Prepared By TNT Filings Inc.</title>
</head>


<html>

<body>

<div style="border-top: 1px solid; padding-top: 1px">
  <hr color="#000000" SIZE="5">
</div>
<font face="Times New Roman" size="5"><b>
<p align="center">SECURITIES AND EXCHANGE COMMISSION</b> <br>
</font><font face="Times New Roman" size="2"><b>Washington, DC 20549</b> </p>
</font><font face="Times New Roman" size="5"><b>
<p align="center">Form 6-K</b> </p>
</font><font face="Times New Roman" size="2"><b>
<p align="center">Report of Foreign Private Issuer <br>
Pursuant to Rule 13a-16 or 15d-16 of<br>
&nbsp;the Securities Exchange Act of 1934</b> </p>
<div align="center">
  <center>
  <table id="AutoNumber1" style="border-collapse: collapse" borderColor="#111111" cellSpacing="0" cellPadding="0" width="50%" border="0">
    <tr>
      <td width="50%">
      <p align="center"><font face="Times New Roman" size="2">For the month of:
      February 2008&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
      <td width="50%">
      <p align="center"><font face="Times New Roman" size="2">&nbsp;Commission File
      Number: 1-14830 </font></td>
    </tr>
  </table>
  </center>
</div>
<font face="Times New Roman" size="5"><b>
<p align="center">GILDAN ACTIVEWEAR INC.</b> <br>
</font>(<i>Translation of Registrant's name into English</i>) </p>
<b>
<p align="center">725 Mont&#233;e de Liesse <br>
Montr&#233;al, Qu&#233;bec <br>
Canada H4T 1P5</b> <br>
(<i>Address of Principal Executive Offices</i>) </p>
<p align="left">Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F: </p>
<div align="center">
  <center>
  <table id="AutoNumber1" style="border-collapse: collapse" borderColor="#111111" cellSpacing="0" cellPadding="0" width="50%" border="0">
    <tr>
      <td align="middle" width="50%"><font face="Times New Roman" size="2">Form
      20-F </font><font face="Wingdings 2" size="3">&#163;</font></td>
      <td align="middle" width="50%"><font face="Times New Roman" size="2">Form
      40-F </font><font face="Wingdings 2" size="3">Q</font></td>
    </tr>
  </table>
  </center>
</div>
<p>Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(1): <font face="Wingdings 2" size="3">
&#163;</font></p>
<p>Indicate by check mark if the registrant is submitting the form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(7): <font face="Wingdings 2" size="3">
&#163;</font></p>
<p>Indicate by check mark whether by furnishing the information contained in
this Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
<font face="Wingdings 2" size="3">&#163;</font></p>
<div align="center">
  <center>
  <table id="AutoNumber2" style="border-collapse: collapse" borderColor="#111111" cellSpacing="0" cellPadding="0" width="50%" border="0">
    <tr>
      <td align="middle" width="50%"><font face="Times New Roman" size="2">Yes
      </font><font face="Wingdings 2" size="3">&#163;</font></td>
      <td align="middle" width="50%"><font face="Times New Roman" size="2">No
      </font><font face="Wingdings 2" size="3">Q</font></td>
    </tr>
  </table>
  </center>
</div>
<p>If &quot;Yes&quot; is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): N/A </p>
<hr color="#000000" SIZE="5">
<p style="page-break-before: always"><b></p>
<p align="center">SIGNATURES</b> </p>
<p style="text-indent: 30px" align="justify">Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized. </p>
<table style="font-size: 10pt; border-collapse: collapse" borderColor="#111111" cellSpacing="0" cellPadding="0" width="100%" border="0">
  <tr>
    <td width="48%">&nbsp;</td>
    <td width="1%">&nbsp;</td>
    <td width="1%">&nbsp;</td>
    <td width="35%">&nbsp;</td>
    <td width="15%">&nbsp;</td>
  </tr>
  <tr>
    <td vAlign="top" align="left">&nbsp;</td>
    <td align="left" colSpan="3"><b>GILDAN ACTIVEWEAR INC.</b></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td align="left">&nbsp;</td>
    <td vAlign="top">&nbsp;</td>
    <td style="border-bottom: medium none #000000" align="left" colSpan="2">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td align="left">Date: February 11, 2008</td>
    <td vAlign="top">By:&nbsp;&nbsp;</td>
    <td style="border-top: medium none; border-bottom: 1px solid #000000" align="left" colSpan="2">
    /s/ Lindsay Matthews &nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td align="left">&nbsp;</td>
    <td>&nbsp;</td>
    <td vAlign="top">Name:&nbsp;&nbsp;</td>
    <td align="left">Lindsay Matthews&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td align="left">&nbsp;</td>
    <td>&nbsp;</td>
    <td vAlign="top">Title:&nbsp;&nbsp;</td>
    <td align="left">Director, Legal Services and<br>
    Corporate Secretary&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td colSpan="5">&nbsp;</td>
  </tr>
</table>
<p>&nbsp;</p>
<hr color="#000000" SIZE="5">
<p style="page-break-before: always"><b></p>
<p align="center">EXHIBIT INDEX</b> </p>
<table style="font-size: 10pt; border-collapse: collapse" borderColor="#111111" cellSpacing="0" cellPadding="0" width="100%" border="0">
  <tr style="font-size: 8pt" vAlign="bottom">
    <td style="border-bottom: 1px solid #000000" noWrap align="left" height="16">
    <b><font face="Times New Roman" size="2">Exhibit</font></b></td>
    <td height="16"><font face="Times New Roman" size="2">&nbsp;</font></td>
    <td style="border-bottom: 1px solid #000000" noWrap align="middle" height="16">
    <p align="left"><b><font face="Times New Roman" size="2">Description of
    Exhibit</font></b></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="top" height="1"></td>
    <td vAlign="top" height="1"></td>
    <td vAlign="top" height="1"></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="center" height="15"></td>
    <td vAlign="center" height="15"></td>
    <td vAlign="center" height="15"></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="center" bgColor="#E9F1F8" height="15">
    <a href="gildanexh991.htm" style="text-decoration: none">99.1</a></td>
    <td vAlign="center" bgColor="#E9F1F8" height="15">&nbsp;</td>
    <td vAlign="center" bgColor="#E9F1F8" height="15">
    <a href="gildanexh991.htm" style="text-decoration: none">Q1 2008 - Quarterly Report to Shareholders</a></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="center" height="15">
    <a href="gildanexh992.htm" style="text-decoration: none">99.2</a></td>
    <td vAlign="center" height="15"></td>
    <td vAlign="center" height="15">
    <a href="gildanexh992.htm" style="text-decoration: none">Q2 2008 - Management's Discussion and Analysis</a></td>
  </tr>
</table>
<p>&nbsp;</p>
<hr color="#000000" size="5">
</font>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>gildanexh991.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
<html>

<head>
<title>Gildan Activewear Inc: Form 6-K - Prepared by TNT Filings Inc.</title>
</head>

<body>

<div style="border-top-style: solid; border-top-width: 1; padding-top: 1">
  <hr color="#000000" size="5">
</div>
<p align="center"><img border="0" src="gildan1.gif" width="267" height="78"></p>
<font FACE="Times New Roman" SIZE="7" color="#005AAC"><b>
<p align="left">Q1 2008 <br>
</b></font><font FACE="Arial MT" SIZE="7">QUARTERLY <br>
REPORT TO <br>
SHAREHOLDERS</font><font FACE="Times New Roman PSMT"> </p>
</font>
<p align="center"><img border="0" src="gildan2.gif" width="100%" height="402"></p>
<hr color="#000000" size="5"><p Style='page-break-before:always'><font SIZE="1" face="Times New Roman">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p align="justify"><font color="#007CBC">This Management's discussion and
analysis (MD&amp;A) comments on Gildan's operations, performance and financial
condition as at and for the three months ended December 30, 2007, compared to
the corresponding periods in the previous year. For a complete understanding of
our business environment, trends, risks and uncertainties and the effect of
accounting estimates on our results of operations and financial condition, this
interim MD&amp;A should be read together with the unaudited interim consolidated
financial statements as at and for the three months ended December 30, 2007 and
the related notes, and with our MD&amp;A for the year ended September 30, 2007 (2007
Annual MD&amp;A), which is part of the fiscal 2007 Annual Report. This MD&amp;A is dated
February 7, 2008. All amounts in this report are in U.S. dollars, unless
otherwise noted. </font></p>
<p align="justify"><font color="#007CBC">All financial information contained in
this interim MD&amp;A and in the interim consolidated financial statements has been
prepared in accordance with Canadian generally accepted accounting principles (GAAP),
except for certain information discussed in the paragraph entitled &quot;Non-GAAP
Financial Measures&quot; on page 5 of this MD&amp;A. The unaudited consolidated financial
statements and this MD&amp;A were reviewed by Gildan's Audit and Finance Committee
and were approved by our Board of Directors. </font></p>
<p align="justify"><font color="#007CBC">Additional information about Gildan,
including our 2007 Annual Information Form, is available on our website at
www.gildan.com, on the SEDAR website at www.sedar.com, and on the EDGAR section
of the U.S. Securities and Exchange Commission website (which includes the
Annual Report on Form 40-F) at www.sec.gov. </font></p>
<p align="justify"><font color="#007CBC">This document contains forward-looking
statements, which are qualified by reference to, and should be read together
with the &quot;Forward-looking Statements&quot; cautionary notice on page 20. </font></p>
<p align="justify"><font color="#007CBC">In this MD&amp;A, &quot;Gildan&quot;, the &quot;Company&quot;,
or the words &quot;we&quot;, &quot;us&quot;, &quot;our&quot; refer, depending on the context, either to Gildan
Activewear Inc. or to Gildan Activewear Inc. together with its subsidiaries and
joint venture. </font></p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#007CBC"><b>OUR BUSINESS</b></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">Gildan is a vertically-integrated marketer and manufacturer
of activewear, underwear and socks. The Company operates in one business
segment, being high-volume, basic, frequently replenished, non-fashion apparel.
We are the leading supplier of activewear for the wholesale imprinted sportswear
market in the U.S. and Canada, and also a leading supplier for this market in
Europe. As part of our growth strategy to sell our products into the mass-market
retail channel in North America, we expanded our product-line in 2006 to include
socks and underwear. We are now one of the leading suppliers of socks in the
U.S. mass-market retail channel. </p>
<p ALIGN="JUSTIFY">Effective October 15, 2007, we acquired 100% of the capital
stock of V.I. Prewett &amp; Son, Inc. (Prewett), a U.S. supplier of basic family
socks to U.S. mass-market retailers. Prewett's corporate headquarters are
located in Fort Payne, Alabama. The acquisition is intended to further enhance
Gildan's position as a full-product supplier of socks, activewear and underwear
for the retail channel. We paid $125 million on closing, and also placed $10
million in escrow to provide for a further contingent increase in the purchase
price of the acquisition. The funds were drawn under our revolving long-term
credit facility. We accounted for this acquisition using the purchase method and
the results of Prewett were consolidated with those of Gildan from the date of
acquisition. </p>
<b>
<p align="justify">Our Products <br>
</b>
We specialize in marketing and large-scale manufacturing of
basic, non-fashion apparel products for customers requiring an efficient supply
chain and consistent product quality for high-volume automatic replenishment
programs. </p>
<p ALIGN="JUSTIFY">We sell activewear, namely T-shirts, fleece and sport shirts,
in large quantities to wholesale distributors as undecorated &quot;blanks&quot;, which are
subsequently decorated by screenprinters with designs and logos. We sell our
products to wholesale distributors under the Gildan brand. Consumers ultimately
purchase the Company's products in venues such as sports, entertainment and
corporate events, and travel and </font><font FACE="Arial MT" SIZE="2">tourism
destinations. The Company's products are also utilized for work uniforms and
other end-uses to convey individual, group and team identity. In the retail
channel, we have complemented our activewear product-line with a variety of
styles of socks and men's and boys' underwear. We sell these products to
mass-market and regional retailers in North America under the Gildan brand and
under various retailer private label programs. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.2 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'><font FACE="Times New Roman" SIZE="2"><b>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<p align="justify">Our Manufacturing and Distribution Facilities
</b>
<u><br>
Textile and Sock Manufacturing <br>
</u>To support our sales in various markets, we have built and
are continuing to build modern manufacturing facilities located in Central
America and the Caribbean Basin where we manufacture all of our T-shirts,
fleece, sport shirts and underwear. Our largest manufacturing hub in Central
America includes our first integrated knitting, bleaching, dyeing, finishing and
cutting facility in Rio Nance, Honduras, which became operational in 2002. In
addition, during 2007, we commenced production at our new state-of-the-art
integrated sock manufacturing facility and at our new integrated textile
facility for the production of activewear, both in Rio Nance, Honduras. We
expect to complete the expansion of our new sock and activewear facilities by
the third quarter of fiscal 2008. In August 2007, we announced plans for a
second sock facility to support our projected continuing growth in sales, which
is expected to be constructed and ramped up over twenty-four months. In
addition, we are also evaluating the timing and geographical location for future
textile capacity expansion, to support our ongoing growth initiatives in the
U.S. mass-market retail and international markets. </p>
<p ALIGN="JUSTIFY">We have also established a vertically-integrated Caribbean
Basin manufacturing hub with a textile facility for the production of activewear
in Bella Vista, Dominican Republic, which began commercial operations in fiscal
2005 and is currently running at a comparable scale of production to our mature
textile facility in Honduras. </p>
<p ALIGN="JUSTIFY">In addition to our integrated sock manufacturing facility
located in our Central America manufacturing hub, we have a U.S. sock
manufacturing facility in Hillsville, Virginia, and as a result of the Prewett
acquisition, we have sock manufacturing facilities in Fort Payne, Alabama. </p>
<p align="justify">Our land and infrastructure in Central America and the
Caribbean Basin can accommodate further capacity expansion on the same sites.
</p>
<p align="justify"><u>Yarn-Spinning </u><br>
CanAm Yarns, LLC (CanAm), our joint-venture company with
Frontier Spinning Mills, Inc. (Frontier), operates yarn-spinning facilities in
Georgia and North Carolina. CanAm's yarn-spinning operations, together with
supply agreements currently in place with Frontier and other third-party yarn
providers, serve to meet our yarn requirements. </p>
<p align="justify"><u>Sewing <br>
</u>Our sewing facilities are located in Central America and the
Caribbean Basin. We also utilize third-party contractors, primarily in Haiti, to
complement our vertically-integrated sewing production. </p>
<p align="justify"><u>Distribution <br>
</u>We distribute our products for the wholesale imprinted
sportswear market in the U.S. primarily out of our company-owned distribution
centre in Eden, North Carolina, and also use third-party warehouses in the
western United States, Canada, Mexico, Europe and Asia to service our customers
in these markets. We also operate distribution centres in Martinsville, Virginia
and Fort Payne, Alabama dedicated to servicing the retail channel. We are also
developing facilities to enhance our ability to provide direct shipments from
our Central American and Caribbean Basin manufacturing hubs. </p>
<p align="justify"><u>Corporate Head Office and Employees <br>
</u>Our corporate head office is located in Montreal, Canada and
we currently employ more than 16,000 full-time employees worldwide. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.3 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">Market Overview <br>
</b>
Our target market for activewear, socks and underwear is
characterized by low fashion risk compared to many other apparel markets, since
our products are basic and produced in a limited range of sizes, colours and
styles, and since logos and designs for the screenprint market are not imprinted
or embroidered by Gildan. </p>
<p align="justify">The apparel market for our products is highly competitive.
Competition is generally based upon price, with reliable quality and service
also being key requirements for success. Our primary competitors in North
America are the major U.S.-based manufacturers of basic family apparel for the
wholesale and retail channels, such as the Hanes, Fruit of the Loom, and Jerzees
brands. The competition in the European wholesale imprinted activewear market is
similar to that in North America, as we compete primarily with the European
divisions of the larger U.S.-based manufacturers. In Europe, we also have large
competitors, which do not have integrated manufacturing operations and source
products from contractors in Asia. In addition, we face the threat of increasing
global competition. In particular, the U.S. sock industry is subject to global
competition, including significant imports from Asia. </p>
<p align="justify">We believe that growth for activewear products has been
driven by several market trends such as the following: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2" face="Times New Roman">continued use of activewear for event
  merchandising (such as concerts, festivals, etc.); </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">continued evolution of the
  entertainment/sports licensing and merchandising businesses; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">the growing use of activewear for
  uniform applications; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">the growing use of activewear for
  corporate promotions; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">continued increase in use of activewear
  products for travel and tourism; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">an increased emphasis on physical
  fitness; and </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">a greater use and acceptance of casual
  dress in the workplace. </li>
</ul>
<p align="justify">In addition, reductions in manufacturing costs, combined with
quality enhancements in activewear apparel, such as pre-shrunk fabrics, improved
fabric weight, blends and construction, as well as an increased range of colours
and styles have provided consumers with superior products at lower prices. </p>
<p align="justify">We believe that providing a superior value proposition
predicated on reliable product quality and comfort, combined with efficient
customer service and competitive pricing, will continue to be key drivers of
success in both the wholesale and retail channels. </p>
<p align="justify">Due to wholesaler and retailer consolidation, the customer
base to which we sell and are targeting to sell our products is composed of a
relatively small number of significant customers. This concentration is not
unusual in the mass-market retail channel. </p>
<p align="justify">The continued consolidation of the number of suppliers by
retailers looking for the convenience of a full-line supplier of a product
category for the entire family could create growth opportunities for our
products. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><font color="#007CBC"><b>Strategy and Objectives </b>
  </font>
</div>
<p align="justify">We believe that our success in developing our
vertically-integrated manufacturing hubs has allowed us to provide our customers
with low prices, consistent product quality and a reliable supply chain, and has
been the main reason that we have been able to continue to increase our market
presence and establish our market leadership in the imprinted sportswear market.
These are the same factors that management believes will support Gildan's
success in building a consumer brand in the retail channel. </p>
<p align="justify">We are able to price our products competitively because of
our success in reducing operating costs. We accomplish this by: </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.4 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font FACE="Times New Roman" SIZE="2">investing in modern, automated equipment
  and facilities; </li>
  </font><font FACE="Symbol MT" LANG="JA" SIZE="2">
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2" face="Times New Roman">increasing our capacity through the
  development of integrated regional hubs in Central America and the Caribbean
  Basin, where we benefit from strategic locations and favourable international
  trade agreements; and </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">focusing on producing a narrow range of
  basic, high-volume product-lines, which allows us to maximize production
  efficiencies. </li>
</ul>
<p align="justify">We intend to continue to expand capacity through the
acquisition of modern, automated equipment for all aspects of our manufacturing
process to maximize productivity and achieve high efficiency rates. </p>
<p align="justify">Our growth strategy comprises the following five initiatives:
</p>
<ol>
  <li>
  <p align="justify">Continue to increase market share in the U.S. wholesale
  imprinted sportswear market in all product categories </li>
  <li>
  <p align="justify">Leverage our successful business model to penetrate the
  mass-market retail channel and develop Gildan as a consumer brand </li>
  <li>
  <p align="justify">Pursue international growth opportunities </li>
  <li>
  <p align="justify">Continue to generate significant manufacturing cost
  reductions </li>
  <li>
  <p align="justify">Re-invest free cash flow to pursue selective complementary
  acquisitions. </font><font FACE="Courier New PSMT" SIZE="2"></li>
</ol>
</font><font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">We are subject to a variety of business risks that may affect
our ability to maintain our current market share and profitability, as well as
our ability to achieve our long-term strategic objectives. These risks are
described in this interim MD&amp;A under the heading &quot;Risks and Uncertainties&quot; and
in the &quot;Risks and Uncertainties&quot; section of our 2007 Annual MD&amp;A. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><b><font color="#007CBC">Operating Results </font></b>
</div>
<b>
<p align="justify">Non-GAAP Financial Measures <br>
</b>
We use non-GAAP measures to assess our operating performance.
Securities regulations require that companies caution readers that earnings and
other measures adjusted to a basis other than GAAP do not have standardized
meanings and are unlikely to be comparable to similar measures used by other
companies. Accordingly, they should not be considered in isolation. We use non-GAAP
measures such as adjusted net earnings, adjusted diluted EPS, EBITDA, free cash
flow, total indebtedness and net indebtedness to measure our performance from
one period to the next without the variation caused by certain adjustments that
could potentially distort the analysis of trends in our operating performance,
and because we believe such measures provide meaningful information on the
Company's financial condition and operating results. </p>
<p ALIGN="justify">We refer the reader to page 18 for the definition and
complete reconciliation of all non-GAAP financial measures used and presented by
the Company to the most directly comparable GAAP financial measures. </p>
<b>
<p align="justify">Summary of Quarterly Results <br>
</b>
The table below sets forth certain summarized unaudited
quarterly financial data for the eight most recently completed quarters. This
quarterly information is unaudited but has been prepared on the same basis as
the annual audited consolidated financial statements. The operating results for
any quarter are not necessarily indicative of the results to be expected for any
period. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.5 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="28%">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">2008</b></font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">2007</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">2006</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><i>(in $ millions, except per share
    amounts) <sup>(1)</sup></i></font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">Q1</b></font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q2</font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q2</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sales</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">250.5</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">254.9</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">291.6</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">232.1</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">185.8</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">235.2</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">233.9</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">183.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">Net earnings</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">27.5</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">40.9</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">52.4</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">21.1</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">15.6</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">16.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">42.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">31.0</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Net earnings per share</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Basic EPS</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">0.23</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.34</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.44</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.18</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.13</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.14</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.36</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.26</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Diluted EPS</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">0.23</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.34</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.43</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.17</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.13</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.14</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.35</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.26</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">Total assets</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">995.4</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">874.5</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">825.0</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">795.6</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">715.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">723.3</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">673.1</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">643.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Total long-term
    financial liabilities <sup>(2)</sup></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">174.2</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">87.5</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">73.5</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">88.4</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">44.2</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">47.1</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">46.4</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">64.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Average number of shares
    outstanding <i>(in thousands)</i></font></td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Basic</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">120,428</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,401</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,359</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,320</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,278</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,209</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,155</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,108</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Diluted</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">121,656</b></font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,577</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,599</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,529</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,447</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,340</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,254</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,294</font></td>
  </tr>
</table>
<font FACE="Times New Roman" style="font-size: 9pt"><i><sup>
<p style="margin-top: 0; margin-bottom: 0" align="justify">(1) </sup>Quarterly
results reflect the acquisition of Prewett on October 15, 2007 (Q1 2008) and
Kentucky Derby Hosiery Co., Inc. on July 6, 2006 (Q4 2006) from their respective
dates of acquisition.</p>
<sup>
<p style="margin-top: 0; margin-bottom: 0" align="justify">(2) </sup>Represents
sum of long-term debt, future income taxes and non-controlling interest.</p>
</i></font><font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The activewear business is seasonal and we have historically
experienced quarterly fluctuations in operating results. Typically, demand for
our T-shirts is highest in the third quarter of each fiscal year, when
distributors purchase inventory for the peak summer selling season, and lowest
in the first quarter of each fiscal year. Demand for fleece is typically
highest, as a result of cooler weather, in the third and fourth quarters of each
fiscal year. The seasonality of specific product-lines is consistent with that
experienced by other companies in the activewear industry. Throughout the year,
we operate our mature facilities at full capacity in order to be cost efficient.
Consequently, with the seasonal sales trends of our business, we experience
fluctuations in our inventory levels throughout the year. For our sock products,
demand is typically highest in the first and fourth quarters of each fiscal
year, stimulated largely by the cooler weather, the need to support requirements
for the back-to-school period and the peak retail selling during the Christmas
holiday season. Management anticipates that the seasonality we have historically
experienced will continue in the future, although it is expected to be somewhat
mitigated by our product diversification. </p>
<b>
<p align="justify">Business Acquisition <br>
</b>
On October 15, 2007, we acquired 100% of the capital stock of
Prewett, a U.S. supplier of basic family socks to U.S. mass-market retailers.
Prewett's corporate headquarters are located in Fort Payne, Alabama. The
acquisition is intended to enhance further the Company's position as a
full-product supplier of socks, activewear and underwear for the retail channel. </p>
<p ALIGN="JUSTIFY">The aggregate purchase price of $125 million paid in cash on
closing is subject to adjustments based on working capital balances as at the
date of acquisition, which have not yet been finalized. In addition, the
purchase agreement provides for an additional purchase consideration of $10
million contingent on specified future events. This amount was paid into escrow
by Gildan and is included in &quot;Other assets&quot; on the consolidated balance sheet.
Any further purchase price consideration paid by the Company will be accounted
for as additional goodwill. </p>
<p>We accounted for this acquisition using the purchase method and the results
of Prewett have been consolidated with those of the Company from the date of
acquisition. </p>
<p ALIGN="JUSTIFY">We have allocated the purchase price on a preliminary basis
to the assets acquired and the liabilities assumed based on management's best
estimate of their fair values and taking into account all relevant information
available at that time. Since we are still in the process of finalizing the
valuation of certain intangible assets and other assets acquired and liabilities
assumed at the date of acquisition, the allocation of the purchase price is
subject to change. The Company expects to finalize the purchase price allocation
by the end of fiscal 2008. We refer the reader to Note 4 of the interim
consolidated financial statements for a summary of the estimated fair value of
assets acquired and liabilities assumed at the date of acquisition. </p>
<b>
<p align="justify">Sales <br>
</b>
Sales for the first quarter, which is seasonally the lowest quarter of the
fiscal year for sales of activewear, amounted to $250.5 million, up 34.8% from
$185.8 million in the first quarter of fiscal 2007. The increase in </font>
<font FACE="Arial MT" SIZE="2">sales revenues was due to an increase of 92.7% or
$39.4 million in sock sales due to the acquisition of Prewett and new retail
sock programs obtained in fiscal 2007, a 13.7% increase in unit sales volumes
for activewear, and an increase of approximately 2.5% in activewear unit selling
prices. The growth in sales was achieved in spite of the elimination during
fiscal 2007 of unprofitable sock product-lines, which did not fit with Gildan's
strategy. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.6 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Market growth and share data presented for the U.S. wholesale
distributor channel is based on the S.T.A.R.S. Report produced by ACNielsen
Market Decisions. The table below summarizes the S.T.A.R.S. data for the quarter
ended December 31, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Three months ended December
    31</b></font></td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Three months ended December
    31</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2007 vs 2006</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2007</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2006</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 55">
    <font SIZE="2"><b>Unit Growth</b></font></td>
    <td COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 50">
    <font SIZE="2"><b>Market Share</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Industry</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">All Products</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">15.1%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">3.0%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>49.3%</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">44.2%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">T-shirts</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">13.6%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">4.3%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>50.0%</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">46.0%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Fleece</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">30.3%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(4.6)%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>49.1%</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">36.0%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Sport shirts</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">2.4%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.3%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>35.4%</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">34.6%</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The increase in activewear unit sales was due to continuing
market share penetration in all product categories in the U.S. distributor
channel and an increase of 3.0% in overall industry shipments from U.S.
distributors to screenprinters during the three months ended December 31, 2007.
In the T-shirt category, sales volumes of Gildan T-shirts by U.S. distributors
to screenprinters grew by 13.6% for the quarter ended December 31, 2007, and our
leading share in this category increased to 50.0%. Unit volume growth of Gildan
fleece products from U.S. distributors to screenprinters totaled 30.3%, compared
to an overall decline of 4.6% for the industry. Our leading market share in this
category increased to 49.1%. We increased our leading brand position in sport
shirts by achieving a 35.4% market share, and sales volumes of Gildan sport
shirts from U.S. distributors to screenprinters grew by 2.4%, while growth for
the industry was essentially flat. </p>
<p align="justify">During the first quarter of fiscal 2008, the Company obtained its first
underwear program with a U.S. national mass-market retailer. Shipments for this
program are expected to begin in May of 2008. </p>
<p ALIGN="JUSTIFY">In addition to our growth in U.S. markets, unit shipments to
Canada, Europe, Asia/Pacific and Mexico increased by 19.3%, compared to the
first quarter of fiscal 2007. The Company has leased warehouse space in Shenzen,
China with a third-party logistics provider, to support its growth objectives in
the Chinese market. </p>
<b>
<p align="justify">Gross Profit <br>
</b>
Gross profit for the first quarter of fiscal 2008 was $78.9
million, or 31.5% of sales, compared to $53.9 million, or 29.0% of sales during
the first quarter of fiscal 2007. The increase in gross margins was due to
higher activewear selling prices and increased manufacturing efficiencies for
activewear. Gross margins include the negative impact of the consumption of
opening textile and sock inventories produced at higher cost structures prior to
our consolidation of our manufacturing in our offshore facilities. Gross margins
were also impacted by sock inventory write-downs in the first quarter of fiscal
2008 due to our decision to accelerate the liquidation of unprofitable
product-lines which have been discontinued. In addition, the Prewett sock
business currently generates lower gross margins than Gildan's activewear
business. </p>
<b>
<p align="justify">Selling, General and Administrative Expenses <br>
</b>
Selling, general and administrative (SG&amp;A) expenses in the
first quarter of fiscal 2008 were $32.6 million, or 13.0% of sales, compared to
$26.1 million, or 14.1% of sales, in the first quarter of last year. The overall
increase in SG&amp;A expenses was due to the impact of the acquisition of Prewett,
higher distribution costs, and increased administrative and information
technology costs to support our continuing growth strategy. Administrative
expenses were also impacted by the stronger Canadian dollar. The impact of these
higher <font FACE="Arial MT" SIZE="2">costs was partially offset by the
non-recurrence of a $1.1 million charge incurred in the first quarter of fiscal
2007 for the replacement of the Company's leased aircraft. </p>
</font></font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.7 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">Restructuring and Other Charges <br>
</b>
In fiscal 2006 and 2007, we announced the closure, relocation
and consolidation of manufacturing and distribution facilities in Canada, the
United States and Mexico, as well as the relocation of Gildan's corporate
office. The costs incurred in connection with these announcements have been
recorded as restructuring and other charges, and included severance and other
exit costs, asset impairment losses and accelerated depreciation resulting from
the reduction in the estimated remaining economic lives of property, plant and
equipment at these facilities. Restructuring charges of $0.8 million in the
first quarter of fiscal 2008 includes other exit costs of $1.1 million incurred
in connection with the closures noted above, including carrying and dismantling
costs associated with assets held for sale, less a gain of $0.3 million
recognized on the disposal of assets held for sale. We expect to incur
additional carrying costs relating to the closed facilities being held for sale,
which will be accounted for as restructuring charges as incurred during fiscal
2008, until all property, plant and equipment related to the closures are
disposed of. Any gains or losses on the disposition of the assets held for sale
will also be accounted for as restructuring charges as incurred. </p>
<p ALIGN="JUSTIFY">Restructuring charges of $1.4 million in the first quarter of
fiscal 2007 were composed of $1.1 million of accelerated depreciation, primarily
related to the closures noted above, and $0.3 million of additional severance
costs and carrying costs relating to closed facilities. </p>
<b>
<p align="justify">Depreciation and Interest Expense <br>
</b>
Depreciation and amortization expense increased to $12.8
million in the first quarter of fiscal 2008, compared to $8.8 million in the
first quarter of fiscal 2007. The increase in depreciation and amortization
expense was due to a higher capital asset base resulting from the Company's
continuing investments in capacity expansion, combined with the impact of the Prewett acquisition. </p>
<p ALIGN="JUSTIFY">Net interest expense amounted to $2.8 million in the first
quarter of fiscal 2008, up $1.8 million from $1.0 million in the same period
last year mainly due to the increase in amounts drawn under our revolving
long-term credit facility to fund the acquisition of Prewett, effective October
15, 2007. </p>
<b>
<p align="justify">Income Taxes <br>
</b>
Income tax expense for the first quarter of fiscal 2008 was
$2.1 million compared to an income tax expense of $1.1 million in the first
quarter of fiscal 2007. Excluding the impact of restructuring and other charges,
the effective income tax rate in the first quarter of fiscal 2008 was 6.8%
compared to an effective income tax rate of 6.0% for the same period last year.
The increase in the effective income tax rate was mainly due to our operations
in the U.S, including our acquisition of Prewett, which was effective October
15, 2007, and higher income from our Canadian operations, both of which are
taxed at higher effective income tax rates. </p>
<b>
<p align="justify">Net Earnings <br>
</b>
Net earnings for the quarter were $27.5 million, or $0.23 per
share, on a diluted basis (EPS), up respectively 76.3% and 76.9% from net
earnings of $15.6 million, or $0.13 per share, in the same period last year.
Included in net earnings were restructuring and other charges, which related to
our previously announced restructuring of our Canadian and U.S. manufacturing
facilities totalling $0.8 million, or $0.01 per share in the first quarter of
fiscal 2008 and $1.4 million, or $0.01 per share in the first quarter of fiscal
2007. Before reflecting the restructuring charges in both fiscal years, adjusted
net earnings and adjusted diluted EPS for the first quarter of fiscal 2008
increased respectively 66.5% and 64.3% from adjusted net earnings of $17.0
million or $0.14 per share in the first quarter last year. The growth in EPS was
primarily due to higher unit sales volumes, selling prices and manufacturing
efficiencies for activewear. As a result of the same factors, diluted EPS was
$0.02 higher than the earnings guidance previously provided by the Company. The
acquisition of Prewett was accretive by $0.01 per share after taking into
account financing costs. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.8 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><font color="#007CBC"><b>Financial Condition </b></font>
</div>
<p ALIGN="JUSTIFY">Accounts receivable decreased to $152.0 million in the first
quarter of fiscal 2008 from $206.1 million at September 30, 2007 and grew by
$53.7 million compared to the first quarter of the prior year. The decrease in
accounts receivable from the end of fiscal 2007 reflected the low seasonal level
of sales and a decline in days sales outstanding consistent with prior years due
to seasonal programs invoiced with payment terms maturing in the first quarter,
partially offset by the inclusion of accounts receivable from the Prewett
acquisition. The increase in accounts receivable compared to the first quarter
of fiscal 2007 was mainly due to the 17.2% increase in activewear sales in the
first quarter over the prior year and the inclusion of the accounts receivable
from the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Inventories of $294.5 million were up $54.6 million, or 22.8%
from September 30, 2007 and up $61.0 million, or 26.1% compared to the first
quarter of fiscal 2007. The increase in inventories compared to both periods
reflected the inclusion of inventories from the Prewett acquisition. The
remaining increase in inventories from September 30, 2007 reflected the seasonal
rebuilding of inventories, in line with our requirements to support our
projected sales. The remaining year-over-year inventory increase was in line
with the growth of our activewear business over the prior year. </p>
<p ALIGN="JUSTIFY">Property, plant and equipment, which are net of accumulated
depreciation and asset impairment losses, amounted to $413.3 million at the end
of the first quarter of fiscal 2008, up $35.7 million from September 30, 2007.
This increase was primarily due to the inclusion of $19.3 million of property,
plant and equipment from the acquisition of Prewett, net capital expenditures of
$34.2 million, mainly for the capacity expansion projects in Honduras, partially
offset by depreciation of $11.6 million and a reclassification of property,
plant and equipment to assets held for sale of $6.1 million related to the land
and building of our corporate head office. </p>
<p ALIGN="JUSTIFY">Other assets at the end of the first quarter of fiscal 2008
amounted to $20.5 million, up from $11.4 million at September 30, 2007. The
increase reflected $10 million which was placed in escrow to provide for a
further contingent increase in the purchase price of the acquisition of Prewett
effective October 15, 2007. </p>
<p align="justify">Goodwill and other identifiable intangible assets amounted to
$65.7 million as at December 30, 2007 compared to $2.0 million as at September
30, 2007, as a result of the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Total assets were $995.4 million at December 30, 2007,
compared to $874.5 million at September 30, 2007 and $715.8 million at the end
of the first quarter of fiscal 2007. Working capital was $343.7 million at the
end of the first quarter of fiscal 2008 compared to $342.5 million at September
30, 2007 and $254.7 million at December 31, 2006. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><b><font color="#007CBC">Cash Flows and Liquidity and
  Capital Resources </font></b>
</div>
<b>
<p align="justify">Cash Flows <br>
</b>
Cash flows from operating activities in the first quarter of
fiscal 2008 were $103.4 million, compared to $39.5 million for the previous
year. The increase in cash inflow was mainly due to higher cash operating
earnings, a larger seasonal decrease in accounts receivable and a lower seasonal
increase in inventories compared to the first quarter of fiscal 2007. </p>
<p ALIGN="JUSTIFY">Cash flows used in investing activities were $169.2 million
in the first quarter of fiscal 2008, compared to $30.9 million in the same
period last year, mainly as a result of the acquisition of Prewett, effective
October 15, 2007 for a purchase price of $125 million, plus a contingent payment
of $10 million, which was placed in escrow. Net capital expenditures in the
first quarter of fiscal 2008 amounted to $34.2 million, up $3.9 million from the
first quarter of fiscal 2007. The increase was mainly due to higher spending for
our major textile and sock manufacturing capacity expansion projects in
Honduras. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.9 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p align="justify">Free cash flow<sup>(1)</sup> amounted to $71.0 million in the
first quarter of fiscal 2008, up significantly from free cash flow of $8.6
million in the first quarter of fiscal 2007, mainly as a result of higher cash
operating earnings. </p>
<p ALIGN="JUSTIFY">Cash flows from financing activities in the first quarter of
fiscal 2008 were $70.2 million and consisted primarily of an increase in amounts
drawn under our revolving long-term credit facility to fund the acquisition of
Prewett. This compared to cash outflows of $1.3 million in the same period last
year, which resulted primarily from reduction of long-term debt of Kentucky
Derby and our joint venture. </p>
<p ALIGN="JUSTIFY">We ended the first quarter of fiscal 2008 with cash and cash
equivalents of $13.6 million compared to $36.3 million at the end of the first
quarter last year and $9.3 million at September 30, 2007. Total indebtedness as
at December 30, 2007 amounted to $130.8 million compared to $59.7 million at
September 30, 2007 and $35.6 million at December 31, 2006. The year-over-year
increase in total indebtedness resulted mainly from the increase in long-term
debt from the use of our revolving credit facility to fund the acquisition of
Prewett. </p>
<b>
<p align="justify">Liquidity and Capital Resources <br>
</b>
In recent years, we have funded our operations and capital
requirements with cash generated from operations. A revolving credit facility
has been periodically utilized to finance seasonal peak working capital
requirements. Our primary use of funds on an ongoing basis is related to capital
expenditures for new manufacturing facilities, inventory financing, accounts
receivable funding, and business acquisitions. </p>
<p ALIGN="JUSTIFY">On October 15, 2007, we paid $125 million on closing of the
Prewett acquisition and also placed $10 million in escrow to provide for a
further contingent increase in the purchase price of the acquisition. The funds
were drawn under our revolving long-term credit facility. On October 30, 2007,
we increased our revolving long-term credit facility, which expires on June 28,
2012 and which is subject to a one-year extension on an annual basis, to $400
million. This facility is now on an unsecured basis. As at the end of the first
quarter of fiscal 2008 we had $120 million drawn on our revolving credit
facility. There were no amounts drawn under this facility at December 31, 2006.
We believe our cash flow from operating activities together with our credit
facilities will provide us with sufficient liquidity and capital resources in
fiscal 2008 to fund our anticipated working capital and capital expenditure
requirements. Furthermore, we continue to have significant unused debt financing
capacity and financing flexibility to invest in capital expenditures for further
capacity expansion in excess of our current plans, as well as to pursue other
potential acquisition opportunities. </p>
<p ALIGN="JUSTIFY">In order to be able to support our opportunities for
continuing sales growth, we are continuing to invest in capacity expansion in
Central America. For fiscal 2008, we are projecting capital expenditures of
approximately $140 million. The projected capital investments for fiscal 2008
primarily include the projected expenditures to complete the ramp-up of the
activewear and sock facilities in Honduras, the energy and chemical cost
reduction projects, which we announced in May 2007, investments in our
information technology systems and the construction of a second sock facility to
be completed over twenty-four months. </p>
<p ALIGN="JUSTIFY">In order to maximize flexibility to finance our ongoing
growth and expansion and to be able to take advantage of additional new capital
investment and acquisition opportunities, we do not currently pay a dividend.
Periodically, the merits of introducing a dividend are re-evaluated by our Board
of Directors. </p>
<b>
<p align="justify">Off-Balance Sheet Arrangements <br>
</b>
We have no commitments that are not reflected in our balance
sheets except for operating leases and other purchase obligations, which are
included in the table of contractual obligations below. As disclosed in Note 6
to our interim consolidated financial statements, we have granted corporate
guarantees, irrevocable standby letters of credit and surety bonds to third
parties to indemnify them in the event the Company and some of its subsidiaries
do not perform their contractual obligations. As at December 30, 2007, the
maximum potential liability under these guarantees was $12.1 million, of which
$5.8 million was for surety bonds and $6.3 million was for corporate guarantees
and standby letters of credit. </p>
<sup>
<p align="justify">__________________________<br>
</sup></font><sup><font FACE="Times New Roman" style="font-size: 9pt">(1)</font></sup><font FACE="Times New Roman" style="font-size: 9pt">
Cash flows from operating activities, including net changes in non-cash working
capital balances, less cash from investing activities excluding business
acquisitions. See page 19. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.10 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p>Contractual Obligations <br>
</b>
In the normal course of business, we enter into contractual
obligations that will require us to disburse cash over future periods. The
following table sets forth our contractual obligations for the following items
as at December 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Payments due by period</font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>Less
    than</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>1 to
    3</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>4 to
    5</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>After</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Total</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>1 year</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>years</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>years</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">130.8</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.0</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">121.6</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Operating leases</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">48.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">5.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">13.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">10.0</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">19.4</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Purchase obligations</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">110.7</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">110.5</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0.2</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Other obligations</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>Total Contractual Obligations</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>375.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>205.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>19.0</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>131.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>19.4</b></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p>We expect that cash flows from operations, together with our cash balances
and unutilized bank facilities, will be sufficient to meet foreseeable cash
needs for fiscal 2008. </p>
<b>
<p>Outstanding Share Data <br>
</b>
Our common shares are listed on the New York Stock Exchange and the Toronto
Stock Exchange (GIL). </p>
<p ALIGN="JUSTIFY">As at January 30, 2008, there were 120,457,217 common shares
issued and outstanding along with 947,835 stock options and 922,000 dilutive
restricted share units (Treasury RSUs) outstanding. Each stock option entitles
the holder to purchase one common share at the end of the vesting period at a
pre-determined option price. Each Treasury RSU entitles the holder to receive
one common share from treasury at the end of the vesting period, without any
monetary consideration being paid to the Company. However, the vesting of 50% of
the restricted share grant is dependent upon the financial performance of the
Company relative to a benchmark group of Canadian publicly-listed companies. </p>
<b>
<p align="justify">Stock Split <br>
</b>
On May 2, 2007, our Board of Directors approved a two-for-one
stock split effected in the form of a stock dividend. The split was applicable
to all shareholders of record on May 18, 2007. The Company's shares commenced
trading on a post-split basis on May 16, 2007 on the Toronto Stock Exchange, and
on May 28, 2007 on the New York Stock Exchange, in accordance with the
respective requirements of these exchanges. All share and per share data in this
interim MD&amp;A reflect the effect of the stock split on a retroactive basis.
</font><font FACE="Times New Roman PSMT"> </p>
</font><font FACE="Times New Roman" SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <font color="#007CBC"><b>Financial Risk Management </b></font>
</div>
<p ALIGN="JUSTIFY">This section of this MD&amp;A provides disclosures relating to
the nature and extent of the Company's exposure to risks arising from financial
instruments, including credit risk, liquidity risk, foreign currency risk and
interest rate risk, and how the Company manages those risks. The disclosures
under this heading &quot;Financial Risk Management&quot;, in conjunction with the
information in Note 10 to the interim consolidated financial statements
(&quot;Financial Instruments&quot;), are designed to meet the requirements of the Canadian
Institute of Chartered Accountants Handbook Section 3862, &quot;Financial Instruments
Disclosures&quot;, which apply to interim and annual financial statements related to
fiscal years beginning on or after October 1, 2007 and are therefore
incorporated, and are an integral part of, the unaudited interim consolidated
financial statements. </p>
<b>
<p align="justify">Credit risk <br>
</b>
Credit risk is the risk of an unexpected loss if a customer
or counterparty to a financial instrument fails to meet its contractual
obligations, and arises primarily from the Company's trade receivables. The
Company may also have credit risk relating to cash and cash equivalents and
forward foreign exchange contracts, which it manages by dealing only with
highly-rated North American and European financial institutions. The
<font FACE="Arial MT" SIZE="2">carrying amount of financial assets, as disclosed
in Note 10(a) to the interim consolidated financial statements, represents the
Company's maximum credit exposure. </p>
</font></font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.11 </p>
</font>

<hr color="#000000" size="5"><p Style='page-break-before:always'><font FACE="Arial MT" SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p ALIGN="JUSTIFY">The Company's credit risk for trade receivables is
concentrated, as the majority of its sales are to a relatively small group of
wholesale distributors and mass-market retailers. As at December 30, 2007, the
Company's twenty largest trade debtors accounted for 84.4% of trade accounts
receivable, of which one wholesale customer accounted for 13.6% and one retailer
accounted for 17.1%. Of the Company's top twenty trade debtors, thirteen are
wholesale distributors and sixteen are located in the United States. The
remaining trade receivable balances are dispersed among a larger number of
debtors across many geographic areas. </p>
<p ALIGN="JUSTIFY">Most sales are invoiced with payment terms of between 30 to
60 days. In accordance with industry practice, sales of certain seasonal
products to wholesale distributors are invoiced with extended payment terms,
generally not exceeding six months. </p>
<p ALIGN="JUSTIFY">The Company's customers have generally been transacting with
the Company or its acquired subsidiaries for over 5 years, and losses have been
insignificant during that period. Most of our wholesale distributor customers
are privately-held owner-managed enterprises, and many distributors are
highly-leveraged with significant reliance on trade credit terms provided by a
few major vendors, including the Company, and third-party debt financing,
including bank debt secured with accounts receivable and inventory pledged as
collateral. The profile and credit quality of the Company's retail customers
varies from customer to customer. </p>
<p ALIGN="JUSTIFY">The Company's extension of credit to customers involves
considerable judgment. The Company has established various internal controls
designed to mitigate credit risk, including a dedicated credit function which
recommends customer credit limits and payment terms that are reviewed and
approved on a quarterly basis by senior management at the Company's
international sales office in Barbados. Where available, the Company's credit
department periodically reviews external ratings and customer financial
statements, and in some cases obtains bank and other references. New customers
are subject to a specific vetting and pre-approval process. The Company has also
established procedures to suspend the release of goods when customers have
fully-utilized approved credit limits or have not been respecting established
payment terms. From time to time, the Company will temporarily transact with
customers on a prepayment basis where circumstances warrant. While the Company's
credit controls and processes have been effective in mitigating credit risk,
these controls cannot eliminate credit risk and there can be no assurance that
these controls will continue to be effective, or that the Company's low credit
loss experience will continue. In the event of a future credit loss relating to
any one of our top ten customers, the Company could be required to record a
material charge to earnings. </p>
<p ALIGN="JUSTIFY">Customers do not provide collateral in exchange for credit,
except in unusual circumstances. Receivables from selected customers are
partially covered by credit insurance, with amounts usually limited to 20% of
the value of the Company's exposure. The information available through the
insurance company is also considered in the decision process to determine the
credit limits assigned to customers. </p>
<p ALIGN="JUSTIFY">The Company writes off trade receivable accounts to expected
realizable value as soon as the account is determined not to be fully
collectable, with such write-offs charged to earnings unless the loss has been
provided for in prior periods, in which case the write-off is applied to reduce
the allowance for doubtful accounts. The Company updates its estimate of the
allowance for doubtful accounts, based on a customer-by-customer evaluation of
the collectibility of trade receivable balances at each balance sheet reporting
date, taking into account amounts which are past due, and any available
information indicating that a customer could be experiencing liquidity or going
concern problems. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.12 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p>The Company's exposure to credit risk for trade receivables by geographic
area and type of customer as at December 30, 2007 was as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right"><font SIZE="2" face="Times New Roman"><b>
    December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">United States</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">116.1</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2" face="Times New Roman">Europe</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2" face="Times New Roman">7.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">Canada</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">10.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">Other regions</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">2.1</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2" face="Times New Roman"><b>December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: none; border-top-width: medium; border-bottom-style:solid; border-bottom-width:1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style:solid; border-bottom-width:1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6" style="border-top-style: solid; border-top-width: 1"><font SIZE="2" face="Times New Roman">Distributors and
    screenprinters</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6" style="border-top-style: solid; border-top-width: 1"><font SIZE="2" face="Times New Roman">75.2</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">Mass-market retailers</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">61.0</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The aging of trade receivable balances as at December 30, 2007 was as
follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="510">&nbsp;</td>
    <td WIDTH="511" align="right"><font SIZE="2" face="Times New Roman"><b>
    December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Not past due</font></td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">112.8</font></td>
  </tr>
  <tr>
    <td WIDTH="510"><font SIZE="2" face="Times New Roman">Past due 0-30 days</font></td>
    <td WIDTH="511" align="right">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">18.1</font></td>
  </tr>
  <tr>
    <td WIDTH="510" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">Past due 31-120 days</font></td>
    <td WIDTH="511" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">7.3</font></td>
  </tr>
  <tr>
    <td WIDTH="510"><font SIZE="2" face="Times New Roman">Past due 121-180 days</font></td>
    <td WIDTH="511" align="right">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Past due over 180 days</font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">-</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2" face="Times New Roman">Trade receivables</font></td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">138.5</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Less allowance for doubtful accounts</font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">(2.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">&nbsp;</td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<font SIZE="2"><font FACE="Arial MT" SIZE="2">
<p>The movement in the allowance for doubtful accounts in respect of trade
receivables was as follows: </p>
</font><b>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Balance at as September 30, 2007</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">2.0</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Bad debt expense</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Increase due to acquisition</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">Balance at as December 30, 2007</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">2.3</font></td>
  </tr>
</table>
<p align="justify">Liquidity Risk <br>
</b>
Liquidity risk is the risk that the Company will not be able
to meet its financial obligations as they fall due. The Company manages
liquidity risk through the management of its capital structure and financial
leverage, as outlined in Note 11 to the interim unaudited consolidated financial
statements (&quot;Capital Disclosures&quot;). It also manages liquidity risk by
continuously monitoring actual and projected cash flows, taking into account the
seasonality of the Company's sales and receipts and matching the maturity
profile of financial assets and liabilities. The Board of Directors reviews and
approves the Company's operating and capital budgets, as well as any material
transactions out of the ordinary course of business, including proposals on
mergers, acquisitions or other major investments or divestitures. In recent
years, the Company has financed its capacity expansion and sales growth mainly
through internally-generated funds, with a revolving credit facility being used
periodically to finance seasonal peak working capital requirements and
acquisitions. </p>
<p align="justify">The Company has a committed revolving credit facility for a maximum of $400
million which expires on June 28, 2012 and which is subject to a one-year
extension on an annual basis. This facility is unsecured and
<font FACE="Arial MT" SIZE="2">amounts drawn bear interest at LIBOR rates plus a
margin. As at December 30, 2007, $120 million was drawn under this facility
bearing an effective interest rate of 5.8%, primarily to finance the Company's
acquisition of Prewett that occurred on October 15, 2007 as described in this
MD&amp;A and in note 4 to the interim consolidated financial statements. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.13 </p>
</font>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font><font FACE="Arial MT" SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p>The following are the contractual maturities of financial liabilities,
excluding derivative financial instruments and future interest payments but
including interest accrued to December 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111" height="93">
  <tr>
    <td WIDTH="50%" height="14"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>Carrying</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>0 to 12</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>1 to 2</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>2 to 5</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>More than 5</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="19" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>months</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Long-term credit facility</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">120.0</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">120.0</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15"><font SIZE="2">Other long-term debt</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">10.8</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">1.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">118.9</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">118.9</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Total</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">249.7</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">123.5</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121.6</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's only derivative financial liabilities as at
December 30, 2007 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
listed on page 15. </p>
<b>
<p align="justify">Foreign Currency Risk <br>
</b>
The majority of the Company's cash flows and financial assets
and liabilities are denominated in U.S. dollars, which is the Company's
functional and reporting currency. Foreign currency risk is limited to the
portion of the Company's business transactions denominated in currencies other
than U.S. dollars, primarily for sales and distribution expenses for customers
outside of the United States and head office expenses in Canada. For the
Company's foreign currency transactions, fluctuations in the respective exchange
rates relative to the U.S. dollar will create volatility in the Company's cash
flows and the reported amounts for sales and selling, general and administrative
expenses in its consolidated statement of earnings, both on a period-to-period
basis and compared with operating budgets and forecasts. Additional earnings
variability arises from the translation of monetary assets and liabilities
denominated in currencies other than U.S. dollars at the rates of exchange at
each balance sheet date, the impact of which is reported as a foreign exchange
gain and loss in the statement of earnings. </p>
<p ALIGN="JUSTIFY">The Company's objective in managing its foreign currency risk
is to minimize its net exposures to foreign currency cash flows, by transacting
with third parties in U.S. dollars to the maximum extent possible and practical,
and holding cash and cash equivalents and incurring borrowings in U.S. dollars.
The Company monitors and forecasts the values of net foreign currency cash flow
and balance sheet exposures, and from time-to-time will authorize the use of
derivative financial instruments such as forward foreign exchange contracts to
economically hedge a portion of foreign currency cash flows, with maturities of
up to two years. The Company does not use forward foreign exchange contracts for
speculative purposes. </p>
<p ALIGN="JUSTIFY">The following tables provide an indication of the Company's
significant foreign currency exposures during the interim period ended December
30, 2007, including the period end balances of financial and monetary assets and
liabilities denominated in foreign currencies, as well as the amount of sales
and operating expenses during the interim period that were denominated in
foreign currencies, but before considering the effect of forward foreign
exchange contracts. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.14 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="41%" COLSPAN="2" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="10%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="41%" COLSPAN="2" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p align="right">December 30, 2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Cash and cash
    equivalents</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.0</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0.9</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font FACE="Times New Roman" SIZE="2">Accounts receivable</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">14.1</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">2.6</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">3.6</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Accounts payable and
    accrued liabilities</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(18.7)</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(4.5)</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Future income taxes and income taxes
    payable</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(21.1)</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(1.0)</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0.7</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Balance sheet exposure excluding
    financial derivatives</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(25.7)</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="61%" COLSPAN="3" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="61%" COLSPAN="3" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>For the three months ended</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="48%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>December 30, 2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">9.9</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">4.8</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">4.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Operating expenses</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(12.4)</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(0.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Net exposure</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(2.5)</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">2.9</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">In addition to the foreign currency exposures noted above,
the Company also incurs a portion of its manufacturing costs in foreign
currencies, primarily payroll costs paid in Honduran Lempiras. However, the
Company does not currently view its exposure to the Honduran Lempira as a
significant foreign exchange risk, since the Lempira to U.S. dollar exchange
rate has not fluctuated in recent years. </p>
<p ALIGN="JUSTIFY">The following table summarizes the Company's derivative
financial instruments relating to commitments to buy and sell foreign currencies
through forward foreign exchange contracts as at December 30, 2007 and September
30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Notional</b></font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="45%" COLSPAN="2" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    foreign</b></font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Average</b></font></td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="31%" align="center" colspan="2" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p align="center">Carrying and Fair Value</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    currency</b></font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    exchange</b></font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Notional US</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>December 30, 2007</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>rate</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.3</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.4469</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">18.2</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0.9950</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">18.1</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">6-12
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">25.5</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0.9980</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">25.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">5.6</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.3647</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">7.7</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(0.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">6-12
    months</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">8.5</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.3964</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">11.8</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(0.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">5.1</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">1.9996</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">10.2</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.1</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">1.9952</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">10.3</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0.1</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.2</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.2)</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111" height="264">
  <tr>
    <td WIDTH="40%" height="19"><font FACE="Times New Roman" SIZE="2"><i>(in $
    millions)</i></font></td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="11%" height="19">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="18"></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="10%" height="18" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Notional</b></font></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="19%" COLSPAN="2" height="18" align="center"></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Average</b></font></td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="19%" colspan="2" height="19" align="center">
    <div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
      <font FACE="Times New Roman" SIZE="2"><b>Carrying and Fair Value</b></font></div>
    </td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>currency</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>September 30, 2007</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>rate</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="10%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="11%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.4</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.3616</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6.0</font></td>
    <td WIDTH="10%" height="15" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0.3</font></td>
    <td WIDTH="11%" height="15" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15"><font FACE="Times New Roman" SIZE="2">Sell EUR/Buy
    USD</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">4.9</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">1.3626</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">6.7</font></td>
    <td WIDTH="10%" height="15" align="center">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center">
    <font FACE="Times New Roman" SIZE="2">(0.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">9.1</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">1.3677</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">12.4</font></td>
    <td WIDTH="10%" height="19" align="center">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="19" align="center">
    <font FACE="Times New Roman" SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sell GBP/Buy
    USD</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.8</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9988</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">9.6</font></td>
    <td WIDTH="10%" height="15" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6.0</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9841</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">11.9</font></td>
    <td WIDTH="10%" height="19" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="19" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Sell CAD/Buy USD</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">1.0055</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
    <td WIDTH="10%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">50.4</font></td>
    <td WIDTH="10%" height="19" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0.3</font></td>
    <td WIDTH="11%" height="19" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.1)</font></td>
  </tr>
</table>
<font SIZE="2">
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.15 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p>The following exchange rates applied during the reporting period for the
three months ended December 30, 2007: </p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">Quarter</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">
    Reporting</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">average
    rate</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">date
    rate</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" size="2"><b>Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" size="2"><b>Q1 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">CAD to USD</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.0158</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.0207</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font FACE="Times New Roman" size="2">EUR to USD</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">1.4441</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">1.4624</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">GBP to USD</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">2.0466</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.9956</font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Based on the Company's foreign currency exposures noted above
and the forward foreign exchange contracts in effect during the three months
ended December 30, 2007, varying the above foreign exchange rates to reflect a 5
percent strengthening of the U.S. dollar would have increased (decreased) net
earnings as follows, assuming that all other variables remained constant: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Source of net earnings variability
    from changes in foreign exchange rates</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">CAD</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">EUR</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Financial instruments, including
    forward foreign exchange contracts</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.9</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2">Future income tax
    liability and income taxes payable</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Sales and operating expenses</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Increase (decrease) in net earnings</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(0.7)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.9</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.3</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">An assumed 5 percent weakening of the U.S. dollar during the
three months ended December 30, 2007 would have had an equal but opposite effect
on the above currencies to the amounts shown above, on the basis that all other
variables remain constant. </p>
<b>
<p align="justify">Interest Rate Risk <br>
</b>
The Company's interest rate risk is primarily related to the
Company's revolving long-term credit facility, for which amounts drawn are
subject to LIBOR rates in effect at the time of borrowing, plus a margin.
Although LIBOR-based borrowings under the credit facility can be fixed for
periods of up to six months, the Company generally fixes rates for periods of
one to three months. The interest rates on amounts currently drawn on this
facility and on any future borrowings will vary and are unpredictable. </p>
<p align="justify">The Company has the ability to enter into derivative financial instruments
that would effectively fix its cost of current and future borrowings for an
extended period of time, but it has not done so in recent years. </p>
<p ALIGN="JUSTIFY">Based on the value of interest-bearing financial instruments
during the three months ended December 30, 2007, an assumed 0.5 percentage point
increase in interest rates during such period would have decreased net earnings
by $0.2 million, with an equal but opposite effect for an assumed 0.5 percentage
point decrease. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%" id="AutoNumber1">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2" color="#0000FF">Outlook </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">A discussion of management's expectations as to the Company's
outlook for fiscal 2008 is contained in the Company's first quarter earnings
results press release dated January 30, 2008 under the section entitled
&quot;Outlook&quot;. The press release is available on the SEDAR website at
<font color="#0000FF">www.sedar.com</font>, on the EDGAR website at
<font color="#0000FF">www.sec.gov</font> and on the Company's website at
<font color="#0000FF">www.gildan.com</font>. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.16 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1; border-top-style:none; border-top-width:medium">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Critical Accounting
    Estimates</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">Our significant accounting policies are described in Note 2
to our 2007 audited consolidated financial statements. The preparation of
financial statements in conformity with Canadian GAAP requires estimates and
assumptions that affect our results of operations and financial position. By
their nature, these judgments are subject to an inherent degree of uncertainty
and are based upon historical experience, trends in the industry and information
available from outside sources. On an ongoing basis, management reviews its
estimates and actual results could differ materially from those estimates. </p>
<p align="justify">Management believes that the accounting estimates related to the following
areas are most significant to assist in understanding and evaluating our
financial results: </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li></font><font FACE="Times New Roman" SIZE="2">Sales promotional programs;
  </font></li>
  <li><font FACE="Times New Roman" SIZE="2">Trade accounts receivable; </font>
  </li>
  <li><font FACE="Times New Roman" SIZE="2">Property, plant and equipment;
  </font></li>
  <li><font FACE="Times New Roman" SIZE="2">Cotton and yarn procurements; </font>
  </li>
  <li><font FACE="Times New Roman" SIZE="2">Income taxes; and </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li></font><font SIZE="2" face="Times New Roman">Business acquisitions,
  including goodwill and identifiable intangible assets. </li>
</ul>
<p align="justify">For a more detailed discussion of these estimates, readers should review the
&quot;Critical Accounting Estimates&quot; section of the 2007 Annual MD&amp;A. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Recent Accounting
    Pronouncements </font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">In June 2007, the Canadian Institute of Chartered Accountants
(CICA) issued Section 3031, Inventories, which replaces Section 3030 and
harmonizes the Canadian standards related to inventories with International
Financial Reporting Standards (IFRS). This Section provides changes to the
measurement and more extensive guidance on the determination of cost, including
allocation of overhead; narrows the permitted cost formulas; requires impairment
testing; and expands the disclosure requirements to increase transparency. This
Section applies to interim and annual financial statements for fiscal years
beginning on or after January 1, 2008. We have not yet determined what the
impact of adopting this standard will have on our consolidated financial
statements. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Adoption of New Accounting
    Standards </font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Effective the commencement of our 2008 fiscal year, we
adopted CICA Handbook Section 1535, Capital Disclosures, CICA Handbook Section
3862, Financial Instruments&#151;Disclosure and CICA Handbook Section 3863, Financial
Instruments &#150; Presentation. These new Handbook Sections apply to fiscal years
beginning on or after October 1, 2007. The Sections relate to disclosure and
presentation only and did not have an impact on our financial results. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Internal Control Over
    Financial Reporting </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Management's annual evaluation and report on the
effectiveness of internal control over financial reporting as of our most recent
fiscal year ended September 30, 2007 was included in the 2007 Annual MD&amp;A, and
was based on the framework set forth in Internal Control - Integrated Framework
issued by the <i>Committee of Sponsoring Organizations of the Treadway
Commission</i> (COSO). Based on its evaluation under this framework, management
concluded that our internal control over financial reporting was effective as of
September 30, 2007. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.17 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">There have been no material changes in internal control over
financial reporting since September 30, 2007. With respect to the Company's
recent acquisition of Prewett that occurred on October 15, 2007, we have not
completed our assessment of the adequacy of the design or of the operating
effectiveness of Prewett's internal control over financial reporting. We will be
including Prewett in our annual evaluation and report on the effectiveness of
internal control over financial reporting for our fiscal year ending October 5,
2008. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Reconciliation and Definition
    of Non-GAAP Measures </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">We use non-GAAP measures to assess our operating performance
and financial condition. The terms and definitions of the non-GAAP measures used
in this report and a reconciliation of each non-GAAP measure to the most
directly comparable GAAP measure are provided below. The non-GAAP measures are
presented on a consistent basis for all periods presented in this MD&amp;A. These
non-GAAP measures do not have any standardized meanings prescribed by Canadian
GAAP and are therefore unlikely to be comparable to similar measures presented
by other companies. Accordingly, they should not be considered in isolation. </p>
<b>
<p align="justify">Adjusted Net Earnings and Adjusted Diluted EPS <br>
</b>
To measure our performance from one period to the next,
without the variations caused by the impact of restructuring and other charges
as discussed on page 8, management uses adjusted net earnings and adjusted
diluted earnings per share, which are calculated as net earnings and diluted
earnings per share excluding these items. We exclude these items because they
affect the comparability of our financial results and could potentially distort
the analysis of trends in our business performance. Excluding these items does
not imply they are necessarily non-recurring. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amounts)</i></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Reported</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Reported</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">250.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">250.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">185.8</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">185.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">171.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">171.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">131.9</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">131.9</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">78.9</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">78.9</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">53.9</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">53.9</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Selling, general and</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 15">administrative expenses</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">32.6</b></font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">32.6</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">26.1</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">26.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>(0.8)</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(1.4)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">45.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">46.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">26.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">27.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Non-controlling interest in income (loss)</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 15">of consolidated joint venture</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(0.1)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">29.6</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">30.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">16.7</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">18.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Income tax expense</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">27.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">28.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">15.6</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">17.0</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.01</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.13</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.01</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Diluted E.P.S.</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.01</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.13</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.01</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.14</font></td>
  </tr>
</table>
<i><font SIZE="2">
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup>Adjustment to remove restructuring and other charges. See page 8. </p>
</font></i><font SIZE="2"><b>
<p align="justify">EBITDA
</b>
<br>
EBITDA is calculated as earnings before interest, taxes,
depreciation and amortization, non-controlling interest, and excludes the impact
of restructuring and other charges, as discussed on page 8. We use EBITDA, among
other measures, to assess the operating performance of our business. We also
believe this measure is commonly used by investors and analysts to measure a
company's ability to service debt and to meet other payment obligations, or as a
common valuation measurement. We exclude depreciation and amortization expenses,
which are non-cash in nature and can vary significantly depending upon
accounting methods or non-operating factors such as historical cost. Excluding
these items does not imply they are necessarily non-recurring. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.18</p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" style="border-collapse: collapse" bordercolor="#111111" cellpadding="0">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right">&nbsp;</td>
    <td WIDTH="15%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">27.5</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">15.6</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Income tax expense</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Non-controlling interest in income (loss) of</font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">consolidated joint venture</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">EBITDA</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">46.3</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">27.8</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup> See page 8. </p>
</i><b>
<p align="justify">Free Cash Flow <br>
</b>
Free cash flow is defined as cash from operating activities
including net changes in non-cash working capital balances, less cash flow used
in investing activities excluding business acquisitions. We consider free cash
flow to be an important indicator of the financial strength and performance of
our business, because it shows how much cash is available after capital
expenditures to repay debt and to reinvest in our business. We believe this
measure is commonly used by investors and analysts when valuing a business and
its underlying assets. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Cash flows from operating activities</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">103.4</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">39.5</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Cash flows from investing activities</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>(169.2)</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(30.9)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Add back:</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">
    <p style="margin-left: 15">Acquisition of Prewett</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">126.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to acquisition</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">10.0</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Free cash flow</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">71.0</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">8.6</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i><b>
<p>Total Indebtedness and Cash in Excess of Debt (Net Indebtedness) <br>
</b>
We consider total indebtedness and net indebtedness to be important
indicators of the financial leverage of the Company. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">Q4 2007</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Bank indebtedness</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(3.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2">Current portion of
    long-term debt</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2"><b>(4.6)</b></font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(3.7)</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(21.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Long-term debt</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>(126.2)</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(56.0)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(10.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Total indebtedness</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>(130.8)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2">(59.7)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2">(35.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Cash and cash equivalents</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">13.6</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">9.3</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">36.3</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>Cash in excess of debt (net
    indebtedness)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>(117.2)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(50.4)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.7</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.19 </p>
</font>
</i>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1; border-top-style:none; border-top-width:medium">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Risks and
    Uncertainties </font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The Company is subject to a variety of business risks. The
risks described below are risks that could materially affect our business,
financial condition and results of operations, but are not necessarily the only
ones facing the Company. Additional risks that are not currently known to us or
that we currently deem immaterial, could also materially and adversely affect
our business. </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li></font><font FACE="Times New Roman" SIZE="2">Our ability to implement our
  strategies and plans; </font></li>
  <li>
  <p align="justify"><font FACE="Times New Roman" SIZE="2">Our industry is competitive; </font>
  </li>
  <li>
  <p align="justify"><font FACE="Times New Roman" SIZE="2">Our industry is subject to pricing
  pressures; </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li></font>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our success depends on our
  ability to anticipate evolving consumer preferences and trends; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations are subject to
  environmental regulation; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We rely on a relatively small number
  of significant customers; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our customers do not commit to
  purchase minimum quantities; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are exposed to concentrations of
  credit risk; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are subject to international
  trade regulation (see Update to the &quot;Description of Risks and Uncertainties&quot;
  below); </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We currently pay income tax at a
  comparatively low effective rate, which could change in the future; </font>
  </li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">The price of the raw materials we
  buy is prone to significant fluctuations and volatility; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations are subject to
  political, social and economic risks; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our industry is subject to
  fluctuations in sales demand; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our business operations
  significantly rely on our information systems; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are subject to foreign currency
  risk; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations could be affected by
  changes in our relationships with our employees or changes to domestic and
  foreign employment regulations; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We may suffer negative publicity if
  we, or our third-party contractors, violate labour laws or engage in practices
  that are viewed as unethical; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">and We depend on key management </li>
</ul>
<p ALIGN="JUSTIFY">For a more detailed discussion of these potential business
risks, readers should review the &quot;Risks and Uncertainties&quot; section of the 2007
Annual MD&amp;A and the Annual Information Form filed by Gildan with the Canadian
securities regulatory authorities and the Annual Report on Form 40-F filed with
the U.S. Securities and Exchange Commission. </p>
<b>
<p align="justify">Updates to the Description of Risks and Uncertainties
</b>
<u><br>
We are subject to international trade regulation <br>
</u>We noted in our 2007 Annual MD&amp;A that the United States was
considering a safeguard against socks imported from Honduras. On January 18,
2008, the Committee for the Implementation of Textile Agreements notified the
Honduran government of its intent to apply a textile safeguard measure on cotton
socks imported into the United States. The safeguard would take the form of a
tariff of up to a maximum rate of 13.5%. The safeguard can commence as early as
April 2008 but will not extend beyond December 31, 2008. The U.S. government
will now be entering into discussions with the Honduran government in order to
make its final determination on this matter. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Forward-Looking Statements
    </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Certain statements included in this MD&amp;A may constitute
&quot;forward-looking statements&quot; within the meaning of the U.S. <i>Private
Securities Litigation Reform Act of 1995</i> and Canadian securities legislation
and regulations, and are subject to important risks, uncertainties and
assumptions. This forward-looking information includes amongst others,
information with respect to our objectives and the strategies to achieve these
objectives, as well as information with respect to our beliefs, plans,
expectations, anticipations, estimates and intentions. Forward-looking
statements generally can be identified by the use of conditional or
forward-looking terminology such as &quot;may&quot;, &quot;will&quot;, &quot;expect&quot;, &quot;intend&quot;,
&quot;estimate&quot;, &quot;anticipate&quot;, &quot;plan&quot;, &quot;foresee&quot;, &quot;believe&quot; or <font FACE="Arial MT" SIZE="2">
&quot;continue&quot; or the negatives of these terms or variations of
them or similar terminology. We refer you to the Company's filings with the
Canadian securities regulatory authorities and the U.S. Securities and Exchange
Commission, as well as the &quot;Risks and Uncertainties&quot; section of the 2007 Annual
MD&amp;A for a discussion of the various factors that may affect the Company's
future results. Material factors and assumptions that were applied in drawing a
conclusion or making a forecast or projection are also set out throughout this
document. </p>
</font>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.20 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The results or events predicted in such forward-looking
information may differ materially from actual results or events. Material
factors, which could cause actual results or events to differ materially from a
conclusion, forecast or projection in such forward-looking information, include,
but are not limited to: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li></font>
  <p align="justify"><font FACE="Arial MT" SIZE="2">general economic conditions such as
  commodity prices, currency exchange rates, interest rates and other factors
  over which we have no control; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the impact of economic and business
  conditions, industry trends and other external and political factors in the
  countries in which we operate; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the intensity of competitive activity;
  </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in environmental, tax, trade and
  other laws and regulations; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to implement our strategies and
  plans; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to complete and successfully
  integrate acquisitions; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our reliance on a small number of
  significant customers; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in consumer preferences, customer
  demand for our products and our ability to maintain customer relationships and
  grow our business; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our customers do not commit to minimum
  quantity purchases; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the seasonality of our business; </font>
  </li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to attract and retain key
  personnel; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">high reliance on computerized information
  systems; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in accounting policies and
  estimates; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">and disruption to manufacturing and
  distribution activities due to labour disruptions, bad weather, natural
  disasters and other unforeseen adverse events. </li>
</ul>
<p ALIGN="JUSTIFY">This may cause the Company's actual performance and financial
results in future periods to differ materially from any estimates or projections
of future performance or results expressed or implied by such forward-looking
statements. Forward-looking statements do not take into account the effect that
transactions or nonrecurring or other special items announced or occurring after
the statements are made have on the Company's business. For example, they do not
include the effect of business dispositions, acquisitions, other business
transactions, asset writedowns or other charges announced or occurring after
forward-looking statements are made. The financial impact of such transactions
and non-recurring and other special items can be complex and necessarily depends
on the facts particular to each of them. </p>
<p ALIGN="JUSTIFY">We believe that the expectations represented by our
forward-looking statements are reasonable, yet there can be no assurance that
such expectations will prove to be correct. Furthermore, unless otherwise
stated, 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 unless required by
applicable legislation or regulation. The forward-looking statements contained
in this report are expressly qualified by this cautionary statement. </p>
</font><font SIZE="2">
<p>February 7, 2008 </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.21 </p>
</font></font>

<hr color="#000000" size="5"><p Style='page-break-before:always'><b>
<p align="center">Gildan Activewear Inc.<font size="2"><br>
Consolidated Balance Sheets</font></b><font SIZE="2"><br>
(in thousands of U.S. dollars)</font></p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 30, 2007</font></td>
    <td WIDTH="22%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">September 30, 2007</font></td>
    <td WIDTH="20%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(unaudited)</font></td>
    <td WIDTH="5%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(audited)</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Current assets:</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Cash and cash equivalents</font></td>
    <td WIDTH="5%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">13,598</font></td>
    <td WIDTH="5%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">9,250</font></td>
    <td WIDTH="6%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">36,329</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Accounts receivable</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">152,001</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">206,088</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">98,347</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Inventories</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">294,541</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">239,963</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">233,514</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Prepaid expenses and deposits</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">8,775</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">7,959</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6,677</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Future income taxes</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,864</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">2,610</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">4,457</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">472,779</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">465,870</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">379,324</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Property, plant and
    equipment</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">413,303</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">377,617</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">318,007</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">Other assets</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">20,459</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">11,426</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">4,506</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Assets held for sale (note
    7)</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">12,681</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6,610</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">4,658</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">Goodwill and identifiable intangible assets</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">65,663</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">2,024</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">9,352</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Future income taxes</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">10,489</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">10,939</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Total assets</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">995,374</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">874,486</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">715,847</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Current liabilities:</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Bank indebtedness</font></td>
    <td WIDTH="5%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="5%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="6%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">3,500</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">118,880</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">116,683</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">98,179</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Income taxes payable</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">5,613</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">2,949</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">1,399</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Current portion of long-term debt</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">4,589</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">3,689</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">21,518</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">129,082</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">123,321</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">124,596</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">Long-term debt</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">126,231</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">55,971</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">10,635</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Future income taxes</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">40,760</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">24,612</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">28,013</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">Non-controlling interest in consolidated
    joint venture</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">7,223</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">6,932</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">5,590</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">Shareholders' equity:</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Share capital</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">88,463</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">88,061</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">86,953</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Contributed surplus</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">4,505</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">3,953</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right"><font SIZE="2">2,833</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Retained earnings</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">572,862</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" bgcolor="#E6E6E6"><font SIZE="2">545,388</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" bgcolor="#E6E6E6"><font SIZE="2">430,979</font></td>
  </tr>
  <tr>
    <td WIDTH="44%"><font SIZE="2">
    <p style="margin-left: 30">Accumulated other comprehensive income</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">692,078</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">663,650</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">547,013</font></td>
  </tr>
  <tr>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="5%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="14%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Total liabilities and
    shareholders' equity</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">995,374</font></td>
    <td WIDTH="5%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="13%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">874,486</font></td>
    <td WIDTH="6%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="14%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">715,847</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>See accompanying notes to interim consolidated financial statements.</p>
</font><font SIZE="2">
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.22</font></td>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2"><hr color="#000000" size="5"><p Style='page-break-before:always'></font>
<b>
<p align="center">Gildan Activewear Inc.<br>
<font SIZE="2">Consolidated Statements of Earnings and Comprehensive Income</font></b><font SIZE="2"><br>
(In thousands of U.S. dollars, except per share data)</p>
</font><font FACE="Arial MT" SIZE="2">
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    </font><font SIZE="2">
    <td WIDTH="35%" COLSPAN="3" align="right"><font size="2"><i><b>
    <p align="center">Three months ended</b></i></font></td>
  </tr>
  </font><font FACE="Arial MT" SIZE="2">
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="24%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">December 30, 2007</font></td>
    <td WIDTH="22%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">(unaudited)</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Sales</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">250,457</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">185,829</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Cost of sales</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">171,541</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">131,951</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Gross profit</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">78,916</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">53,878</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Selling, general and administrative expenses</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">32,607</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">26,110</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Restructuring and other charges (note 7)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">823</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">1,391</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Earnings before the undernoted items</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">45,486</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">26,377</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">12,847</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">8,774</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Interest, net</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">2,794</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">971</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Non-controlling interest in income (loss) of
    consolidated joint venture</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">291</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">(64)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Earnings before income taxes</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">29,554</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">16,696</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">2,080</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">1,085</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Net earnings and comprehensive income</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font size="2">
    <p style="margin-right: 4">27,474</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font size="2">
    <p style="margin-right: 4">15,611</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Basic EPS (note 8)</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">0.23</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">0.13</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Diluted EPS (note 8)</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">0.23</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">0.13</font></td>
  </tr>
</table>
<font FACE="Arial MT">
<p>See accompanying notes to interim consolidated financial statements.</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.23</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font><b>
<p align="center">Gildan Activewear Inc.<font FACE="Arial MT"><br>
</font><font SIZE="2" FACE="Arial MT">Consolidated Statements of Cash Flows</font></b><font FACE="Arial MT" SIZE="2"><font SIZE="2"><br>
(In thousands of U.S. dollars)</font></p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    </font><font SIZE="2">
    <td WIDTH="35%" COLSPAN="3" align="right"><font size="2"><i><b>
    <p align="center">Three months ended</b></i></font></td>
  </tr>
  </font><font FACE="Arial MT" SIZE="2">
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">December 30, 2007</font></td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">(unaudited)</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Cash flows from operating
    activities:</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Net earnings</font></td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">27,474</font></td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">15,611</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 30">Adjustments for:</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">
    <p style="margin-right: 4">12,847</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">8,774</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Restructuring and other charges</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">1,124</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">(Gain) loss on disposal and writedown of
    property, plant</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">&nbsp;&nbsp;&nbsp; and equipment</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(230)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">358</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Stock-based compensation costs</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">678</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">468</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">Future income taxes</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(1,235)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">244</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Non-controlling interest</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">291</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">(64)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">Unrealized foreign exchange gain</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">(239)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">(1,458)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">39,586</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">25,057</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Changes in non-cash working capital balances:</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Accounts receivable</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">83,347</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">67,417</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">Inventories</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(11,155)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">(32,861)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Prepaid expenses and deposits</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">554</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">(920)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 60">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(11,506)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">(18,444)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 60">Income taxes payable</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">2,568</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font size="2">(776)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">103,394</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">
    <p style="margin-right: 4">39,473</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">Cash flows (used in) from financing
    activities:</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 30">Increase in amounts drawn under revolving
    long-term credit facility</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">71,000</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Decrease in bank indebtedness</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(1,261)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 30">Net (decrease) increase in long-term debt</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">160</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">(1,708)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Proceeds from the issuance of shares</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">276</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">369</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">70,175</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">(1,339)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Cash flows used in
    investing activities:</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Purchase of property, plant and equipment</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(34,150)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">(30,342)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 30">Acquisition of V.I. Prewett &amp; Son, Inc. (note 4)</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">(126,819)</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Restricted cash related to acquistion (note 4)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font size="2">(10,000)</font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-left: 30">Proceeds on disposal of assets held for sale</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">421</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">
    <p style="margin-left: 30">Net increase in other assets</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">1,381</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">(521)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">(169,167)</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font size="2">(30,863)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Effect of exchange rate
    changes on cash and</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">&nbsp;&nbsp;&nbsp; cash
    equivalents denominated in foreign currencies</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font size="2">(54)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">51</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Net increase in cash and
    cash equivalents</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">&nbsp;&nbsp;&nbsp; during
    the period</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">4,348</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font size="2">
    <p style="margin-right: 4">7,322</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Cash and cash equivalents,
    beginning of period</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">9,250</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">29,007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font size="2">Cash and cash equivalents,
    end of period</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">13,598</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-bottom: 2px solid #000000" bgcolor="#E6E6E6">
    <font size="2">
    <p style="margin-right: 4">36,329</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
</table>
<p><font size="2">See accompanying notes to interim consolidated financial
statements.</font></p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.24</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font><b>
<p align="center">Gildan Activewear Inc.<font FACE="Arial MT"><br>
</font><font SIZE="2" FACE="Arial MT">Consolidated Statement of Shareholders'
Equity and Comprehensive Income <br>
Three months ended December 30, 2007 and December 31, 2006</font></b><font FACE="Arial MT" SIZE="2"><font SIZE="2"><br>
(in thousands or thousands of U.S. dollars)</font></p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="8%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right">&nbsp;</td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="8%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" colspan="2"><font FACE="Arial MT" SIZE="2">
    Accumulated</font></td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="29%" COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">
    <p align="center">Share Capital</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right" colspan="2"><font FACE="Arial MT" SIZE="2">
    other</font></td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">Total</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="18%" COLSPAN="2" align="right"><font FACE="Arial MT" size="2">
    Contributed</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right"><font FACE="Arial MT" size="2">
    comprehensive</font></td>
    <td WIDTH="4%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">Retained</font></td>
    <td WIDTH="19%" COLSPAN="2" align="right"><font FACE="Arial MT" size="2">
    shareholders'</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">Number</font></td>
    <td WIDTH="16%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">Amount</font></td>
    <td WIDTH="18%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">surplus</font></td>
    <td WIDTH="4%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">income</font></td>
    <td WIDTH="4%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">earnings</font></td>
    <td WIDTH="4%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2">equity</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">Balance,
    September 30, 2007</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">120,419</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">88,061</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">3,953</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">26,248</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font FACE="Arial MT" size="2">$</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">545,388</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">663,650</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">Stock-based compensation
    related to</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">stock options and restricted
    share units</font></td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">678</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">678</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">Shares
    issued under employee share</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">purchase
    plan</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">2</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">52</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">52</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">Shares issued pursuant to
    exercise of</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">stock options</font></td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">28</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">224</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">224</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">Shares
    issued pursuant to issuance of</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">Treasury
    restricted share units</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">8</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">Ascribed value credited to
    share capital</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">from issuance of treasury
    restricted</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">share units</font></td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">126</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">(126)</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: none; border-bottom-width: medium" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%" bgcolor="#E6E6E6"><font FACE="Arial MT" size="2">Net
    earnings</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">27,474</font></td>
    <td WIDTH="4%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">27,474</font></td>
  </tr>
  <tr>
    <td WIDTH="30%">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font FACE="Arial MT" size="2">Balance, December 30, 2007 (unaudited)</font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">120,457</font></td>
    <td WIDTH="3%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">88,463</font></td>
    <td WIDTH="3%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">4,505</font></td>
    <td WIDTH="4%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">26,248</font></td>
    <td WIDTH="4%" align="right">
    <p style="margin-right: 4"><font FACE="Arial MT" size="2">$</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">572,862</font></td>
    <td WIDTH="4%" align="right"><font FACE="Arial MT" size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 2px solid #000000">
    <font FACE="Arial MT" size="2">
    <p style="margin-right: 4">692,078</font></td>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" style="border-collapse: collapse" bordercolor="#111111" cellpadding="0">
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="80" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="87" align="right">&nbsp;</td>
    <td WIDTH="127" COLSPAN="2" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="80" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="87" align="right">&nbsp;</td>
    <td WIDTH="127" COLSPAN="2" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="80" align="right">&nbsp;</td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="87" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">Accumulated</font></td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="186" COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p align="center">Share Capital</font></td>
    <td WIDTH="28" align="right">&nbsp;</td>
    <td WIDTH="87" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">other</font></td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right">&nbsp;</td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">Total</font></td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="80" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="115" COLSPAN="2" align="right"><font SIZE="2">Contributed</font></td>
    <td WIDTH="127" COLSPAN="2" align="right"><font SIZE="2">comprehensive</font></td>
    <td WIDTH="38" align="right">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">Retained</font></td>
    <td WIDTH="127" COLSPAN="2" align="right"><font SIZE="2">shareholders'</font></td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Number</font></td>
    <td WIDTH="108" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Amount</font></td>
    <td WIDTH="115" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">surplus</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">income</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">earnings</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">equity</font></td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="78" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="80" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="87" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6"><font SIZE="2">Balance, October 1, 2006</font></td>
    <td WIDTH="78" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">120,228</font></td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="80" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">86,584</font></td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="87" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">2,365</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">26,248</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">415,368</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">530,565</font></td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304"><font SIZE="2">Stock-based compensation related to</font></td>
    <td WIDTH="78" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304"><font SIZE="2">stock options and restricted share units</font></td>
    <td WIDTH="78" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right"><font SIZE="2">
    <p style="margin-right: 4">468</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">468</font></td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="78" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6"><font SIZE="2">Shares issued under
    employee share</font></td>
    <td WIDTH="78" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6"><font SIZE="2">purchase plan</font></td>
    <td WIDTH="78" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">2</font></td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">75</font></td>
    <td WIDTH="28" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">75</font></td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304"><font SIZE="2">Shares issued pursuant to exercise of</font></td>
    <td WIDTH="78" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304"><font SIZE="2">stock options</font></td>
    <td WIDTH="78" align="right"><font SIZE="2">
    <p style="margin-right: 4">52</font></td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right"><font SIZE="2">
    <p style="margin-right: 4">294</font></td>
    <td WIDTH="28" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right"><font SIZE="2">
    <p style="margin-right: 4">294</font></td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="78" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304" bgcolor="#E6E6E6"><font SIZE="2">Net earnings</font></td>
    <td WIDTH="78" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="28" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="28" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">15,611</font></td>
    <td WIDTH="38" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">15,611</font></td>
  </tr>
  <tr>
    <td WIDTH="304">&nbsp;</td>
    <td WIDTH="78" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="80" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="87" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="38" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="89" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="304"><font SIZE="2">Balance, December 31, 2006 (unaudited)</font></td>
    <td WIDTH="78" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">120,282</font></td>
    <td WIDTH="28" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="80" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">86,953</font></td>
    <td WIDTH="28" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="87" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">2,833</font></td>
    <td WIDTH="38" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="89" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">26,248</font></td>
    <td WIDTH="38" align="right" style="border-bottom: 2px solid #000000">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="89" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">430,979</font></td>
    <td WIDTH="38" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="89" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">547,013</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>See accompanying notes to interim consolidated financial statements.</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2" FACE="Arial MT">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.25</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </i>
    </font></td>
</font>
  </tr>
</table>
<font SIZE="2"><b>
<p>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS <br>
(For the period ended December 30, 2007) <br>
(Tabular amounts in thousands or thousands of U.S. dollars, except per share
data or unless otherwise noted) <br>
(unaudited) </p>
<p>1. Basis of presentation: of presentation </p>
</b>
<p ALIGN="JUSTIFY">The accompanying unaudited interim consolidated financial
statements have been prepared in accordance with Canadian generally accepted
accounting principles for interim financial information and include all normal
and recurring entries that are necessary for a fair presentation of the
statements. 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's annual consolidated financial statements. </p>
<p align="justify">The Company's revenues and income are subject to seasonal variations.
Consequently, the results of operations for the first fiscal quarter are
traditionally not indicative of the results to be expected for the full fiscal
year. </p>
<p align="justify">All share and per share data in these interim consolidated financial
statements reflect the effect of the two-for-one stock split declared in May
2007. </p>
<p>Certain comparative figures have been reclassified in order to conform with
the current period's presentation. </p>
<p>All amounts in the attached notes are unaudited unless specifically
identified. </p>
<b>
<p>2. Significant accounting policies: </p>
</b>
<p ALIGN="JUSTIFY">Except for the adoption of the new accounting standards
described in Note 3 below, the Company applied the same accounting policies in
the preparation of the interim consolidated financial statements, as disclosed
in Note 1(a) and Note 2 of its audited consolidated financial statements in the
Company's annual report for the year ended September 30, 2007. </p>
<b>
<p>3. Adoption of new accounting standards: </p>
</b>
<p ALIGN="JUSTIFY">Effective the commencement of its 2008 fiscal year, the
Company has adopted the Canadian Institute of Chartered Accountants (&quot;CICA&quot;)
Handbook Section 1535, Capital Disclosures, CICA Handbook Section 3862,
Financial Instruments&#151;Disclosure, and CICA Handbook Section 3863, Financial
Instruments &#150; Presentation. These new Handbook Sections apply to fiscal years
beginning on or after October 1, 2007. The Sections relate to disclosure and
presentation only and did not have an impact on our financial results. See Notes
10 and 11. </p>
<b>
<p>4. Business Acquisition: </p>
</b>
<p align="justify">On October 15, 2007, the Company acquired 100% of the capital
stock of V.I.Prewett &amp; Son, Inc. (&quot;Prewett&quot;), a U.S. supplier of basic family
socks primarily to U.S. mass-market retailers. Prewett's corporate headquarters
are located in Fort Payne, Alabama. The acquisition is intended to enhance
further the Company's position as a full-product supplier of socks, activewear
and underwear for the retail channel. </p>
<p align="justify">The aggregate purchase price of $125 million paid in cash on
closing is subject to adjustments based on working capital balances as at the
date of acquisition, which have not yet been finalized. In addition, the
purchase agreement provides for an additional purchase consideration of $10
million contingent on specified future events. This amount was paid into escrow
by the Company and is included in &quot;Other assets&quot; on the consolidated balance
sheet. Any further purchase price consideration paid by the Company will be
accounted for as additional goodwill. </p>
<p align="justify">The Company accounted for this acquisition using the purchase
method and the results of Prewett have been consolidated with those of the
Company from the date of acquisition. </p>
<p align="justify">The Company has allocated the purchase price on a preliminary
basis to the assets acquired and the liabilities assumed based on management's
best estimate of their fair values and taking into account all relevant
information available at that time. Since the Company is still in the process of
finalizing the valuation of certain intangible assets and other assets acquired
and liabilities assumed at the date of acquisition, the allocation of the
purchase price is subject to change. The Company expects to finalize the
purchase price by the end of fiscal 2008.</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2" FACE="Arial MT">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.26</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </i>
    </font></td>
</font>
  </tr>
</table>
<font SIZE="2"><b>
<p>4. Business Acquisition (continued): </p>
</b>
<p>The following table summarizes the estimated fair value of assets acquired
and liabilities assumed at the date of acquisition: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="57%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 30">Assets acquired:</font></td>
    <td WIDTH="21%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 60">Accounts receivable</font></td>
    <td WIDTH="21%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">28,805</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 60">Inventory</font></td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6"><font SIZE="2">43,423</font></td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 60">Prepaid expenses</font></td>
    <td WIDTH="21%" align="right">&nbsp;</td>
    <td WIDTH="22%" align="right"><font SIZE="2">1,370</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 60">Property, plant and equipment</font></td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6"><font SIZE="2">20,202</font></td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 60">Goodwill and identifiable intangible assets</font></td>
    <td WIDTH="21%" align="right">&nbsp;</td>
    <td WIDTH="22%" align="right"><font SIZE="2">64,376</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 60">Other assets</font></td>
    <td WIDTH="21%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">176</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="21%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">158,352</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 30">Liabilities assumed:</font></td>
    <td WIDTH="21%" align="right">&nbsp;</td>
    <td WIDTH="22%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 60">Bank indebtedness</font></td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,261</font></td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 60">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="21%" align="right">&nbsp;</td>
    <td WIDTH="22%" align="right"><font SIZE="2">14,178</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 60">Future income taxes</font></td>
    <td WIDTH="21%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">16,094</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="21%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">31,533</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="21%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 30">Net assets acquired</font></td>
    <td WIDTH="21%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td WIDTH="22%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">126,819</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6">
    <p style="margin-left: 30">&nbsp;</td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%"><font SIZE="2">
    <p style="margin-left: 30">Consideration:</font></td>
    <td WIDTH="21%" align="right">&nbsp;</td>
    <td WIDTH="22%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 60">Cash</font></td>
    <td WIDTH="21%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="22%" align="right" bgcolor="#E6E6E6"><font SIZE="2">125,294</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 60">Transaction costs</font></td>
    <td WIDTH="21%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,525</font></td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="21%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="57%" style="border-bottom: 2px solid #000000">&nbsp;</td>
    <td WIDTH="21%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">$</font></td>
    <td WIDTH="22%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">126,819</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Goodwill recorded in connection with this acquisition is not
expected to be deductible for tax purposes. Identifiable intangible assets
consists primarily of customer contracts and customer relationships and are
currently being amortized over 10 years based on preliminary estimates of the
useful life of these assets. </p>
<b>
<p>5. Stock-based compensation:</b> </p>
<p ALIGN="JUSTIFY">The Company's Long Term Incentive Plan (the &quot;LTIP&quot;) includes
stock options and restricted share units. The LTIP allows the Board of Directors
to grant stock options, dilutive restricted share units (&quot;Treasury RSUs&quot;) and
non-dilutive restricted share units (&quot;Non-Treasury RSUs&quot;) to officers and other
key employees of the Company and its subsidiaries. </p>
<p>Changes in outstanding stock options were as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Weighted average</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Number</font></td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">exercise price</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(in Canadian dollars)</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" bgcolor="#E6E6E6"><font SIZE="2">Options outstanding,
    September 30, 2007</font></td>
    <td WIDTH="18%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">853</font></td>
    <td WIDTH="26%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">10.08</font></td>
  </tr>
  <tr>
    <td WIDTH="46%"><font SIZE="2">Granted</font></td>
    <td WIDTH="18%" align="right"><font SIZE="2">
    <p style="margin-right: 4">127</font></td>
    <td WIDTH="26%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">39.37</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Exercised</font></td>
    <td WIDTH="18%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(28)</font></td>
    <td WIDTH="26%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">7.92</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Options outstanding, December 30, 2007</font></td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">952</font></td>
    <td WIDTH="26%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">14.07</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">As at December 30, 2007, 678,556 of the outstanding options
were exercisable at the weighted average price of CA$6.46. Based on the Black-Scholes
option pricing model, the grant date weighted average fair value of the options
granted during the first quarter ended December 30, 2007 was CA$12.98. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2" FACE="Arial MT">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.27</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </i>
    </font></td>
</font>
  </tr>
</table>
<font SIZE="2"><b>
<p>5. Stock-based compensation (continued):</b> </p>
<p>Changes in outstanding Treasury RSUs were as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Weighted average</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Number</font></td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">fair value per unit</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="36%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(in Canadian dollars)</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" bgcolor="#E6E6E6"><font SIZE="2">Treasury RSUs outstanding,
    September 30, 2007</font></td>
    <td WIDTH="18%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">941</font></td>
    <td WIDTH="26%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">18.83</font></td>
  </tr>
  <tr>
    <td WIDTH="46%"><font SIZE="2">Granted</font></td>
    <td WIDTH="18%" align="right"><font SIZE="2">
    <p style="margin-right: 4">30</font></td>
    <td WIDTH="26%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">38.10</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" bgcolor="#E6E6E6"><font SIZE="2">Settled through the
    issuance of common shares</font></td>
    <td WIDTH="18%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(8)</font></td>
    <td WIDTH="26%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">17.89</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forfeited</font></td>
    <td WIDTH="18%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(49)</font></td>
    <td WIDTH="26%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">24.62</font></td>
  </tr>
  <tr>
    <td WIDTH="46%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">Treasury RSUs outstanding, December 30, 2007</font></td>
    <td WIDTH="18%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">914</font></td>
    <td WIDTH="26%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">19.16</font></td>
  </tr>
</table>
<font SIZE="2">
<p>As of December 30, 2007, none of the awarded and outstanding Treasury RSUs
were vested. </p>
<p ALIGN="JUSTIFY">The compensation expense recorded for the three month periods
ended December 30, 2007 and December 31, 2006, respectively, was $0.7 million
and $0.5 million, in respect of the Treasury RSUs and stock options. The
counterpart has been recorded as contributed surplus. When the shares are issued
to the employees, the amounts previously credited to contributed surplus are
reclassified to share capital. </p>
<p>Changes in outstanding Non-Treasury RSUs were as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="45%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="55%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Number</font></td>
  </tr>
  <tr>
    <td WIDTH="45%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Non-Treasury RSUs outstanding, September 30, 2007</font></td>
    <td WIDTH="55%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">56</font></td>
  </tr>
  <tr>
    <td WIDTH="45%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Granted</font></td>
    <td WIDTH="55%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">50</font></td>
  </tr>
  <tr>
    <td WIDTH="45%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">Non-Treasury RSUs outstanding, December 30, 2007</font></td>
    <td WIDTH="55%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">106</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Non-Treasury RSUs have the same features as Treasury RSUs
except that their vesting period is a maximum of three years and they will be
settled in cash at the end of the vesting period. The settlement amount is based
on the Company's stock price at the vesting date. As of December 30, 2007, the
weighted average fair value per non-Treasury RSU was CA$40.74. No common shares
are issued from treasury under such awards and they are therefore non-dilutive.
As of December 30, 2007, none of the awarded and outstanding non-Treasury RSUs
were vested. </p>
<p align="justify">The compensation expense recorded for the three month
periods ended December 30, 2007 and December 31, 2006, respectively, was $ 0.3
million and $0.1 million, in respect of the non-Treasury RSUs. </p>
<b>
<p>6. Guarantees: </p>
</b>
<p align="justify">The Company, and some 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 December 30, 2007,
the maximum potential liability under these guarantees was $14.1 million, of
which $5.8 million was for surety bonds and $8.3 million was for corporate
guarantees and standby letters of credit. The standby letters of credit mature
at various dates during 2008, the surety bonds are automatically renewed on an
annual basis and the corporate guarantees mature at various dates up to fiscal
2010. </p>
<p align="justify">As at December 30, 2007, the Company has recorded no
performance liability with respect to these guarantees, as the Company does not
expect to make any payments for the aforementioned items. Management believes
that the fair value of the non-contingent obligations requiring performance
under the guarantees in the event that specified triggering events or conditions
occur approximates the cost of obtaining the standby letters of credit and
surety bonds. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <font SIZE="2" FACE="Arial MT">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.28</font></td>
    </font>
  </tr>
</table>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </i>
    </font></td>
</font>
  </tr>
</table>
<font SIZE="2"><b>
<p>7. Restructuring and other charges and assets held for sale: </p>
</b>
<p align="justify">In fiscal 2006 and 2007, the Company announced the closure,
relocation and consolidation of manufacturing and distribution facilities in
Canada, the United States and Mexico, as well as the relocation of its corporate
office. The costs incurred in connection with these announcements have been
recorded as restructuring and other charges, and included severance and other
exit costs, asset impairment losses and accelerated depreciation resulting from
the reduction in the estimated remaining economic lives of property, plant and
equipment at these facilities. Restructuring charges of $0.8 million in the
first quarter of fiscal 2008 includes other exit costs of $1.1 million incurred
in connection with the closures noted above, including carrying and dismantling
costs associated with assets held for sale, less a gain of $0.3 million
recognized on the disposal of assets held for sale. The Company expects to incur
additional carrying costs relating to the closed facilities being held for sale,
which will be accounted for as restructuring charges as incurred during fiscal
2008, until all property, plant and equipment related to the closures are
disposed of. Any gains or losses on the disposition of the assets held for sale
will also be accounted for as restructuring charges as incurred. </p>
<p align="justify">Restructuring charges of $1.4 million in the first quarter of
fiscal 2007 were composed of $1.1 million of accelerated depreciation, primarily
related to the closures noted above, and $0.3 million of additional severance
costs and carrying costs relating to closed facilities. </p>
<p align="justify">Assets held for sale of $12.7 million as at December 30, 2007
(September 30, 2007 - $6.6 million; December 31, 2006 - $4.7 million) include
property, plant and equipment at these various locations. </p>
<b>
<p>8. Earnings per share: </p>
</b>
<p>A reconciliation between basic and diluted earnings per share is as follows:
</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="30%" COLSPAN="3" align="center"><font SIZE="2"><i><b>Three months
    ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="22%" COLSPAN="2" align="right"><font SIZE="2"><u>December 30,
    2007</u></font></td>
    <td WIDTH="20%" COLSPAN="2" align="right"><font SIZE="2"><u>December 31,
    2006</u></font></td>
  </tr>
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" bgcolor="#E6E6E6"><font SIZE="2">Basic earnings per share:</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 30">Basic weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,428</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,278</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 30">Basic earnings per share</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">0.23</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">0.13</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Diluted earnings per share:</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 30">Basic weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">120,428</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">120,278</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom: 1px solid #000000"><font SIZE="2">
    <p style="margin-left: 30">Plus impact of stock options and Treasury RSUs</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">1,228</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">1,169</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom: 1px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 30">Diluted weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">121,656</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000" bgcolor="#E6E6E6">
    <font SIZE="2">121,447</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom: 1px solid #000000"><font SIZE="2">
    <p style="margin-left: 30">Diluted earnings per share</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">0.23</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">0.13</font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>9. Other information: </p>
</b></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="32%" COLSPAN="3" align="right"><font SIZE="2"><i><b>
    <p align="center">Three months ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right"><font SIZE="2"><u>December 30,
    2007</u></font></td>
    <td WIDTH="22%" COLSPAN="2" align="right"><font SIZE="2"><u>December 31,
    2006</u></font></td>
  </tr>
  <tr>
    <td WIDTH="59%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(a) The following items were included in the determination of
    the Company's net earnings:</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Depreciation of property, plant and equipment</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">11,632</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">8,376</font></td>
  </tr>
  <tr>
    <td WIDTH="59%"><font SIZE="2">Accelerated depreciation of property, plant
    and equipment</font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2">1,124</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" bgcolor="#E6E6E6"><font SIZE="2">Amortization of deferred
    start-up costs and other</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">478</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font SIZE="2">237</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Amortization of intangible assets</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">737</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">161</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(b) Supplemental cash flow disclosure:</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Cash paid during the period for:</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="59%"><font SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp; Interest</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">2,826</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">1,161</font></td>
  </tr>
  <tr>
    <td WIDTH="59%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp; Income taxes</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">917</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">1,471</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <font SIZE="2" FACE="Arial MT">
    <td><font SIZE="2">
    <p align="right">GILDAN QUARTERLY REPORT - Q1 2008 P.29</font></td>
    </font>
  </tr>
</table>

<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font>
    <td width="50%"><font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right"><br>
    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</i></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p><b>9. Other information (continued): </b></p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%">
    <p style="text-indent: -26; margin-left: 26">&nbsp;</td>
    <td WIDTH="13%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 30, 2007</u></font></td>
    <td WIDTH="13%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>September 30, 2007</u></font></td>
    <td WIDTH="27%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 31, 2006</u></font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="text-indent: -26; margin-left: 26">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(audited)</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Non-cash transactions:</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Additions to property, plant
    and equipment included in accounts payable and accrued liabilities</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">1,662</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">2,566</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">2,483</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Ascribed value credited to
    share capital from issuance of Treasury RSUs</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">126</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">226</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Reversal of valuation allowance
    on acquired future income tax assets credited to intangible assets</font></td>
    <td WIDTH="3%" align="right" valign="bottom">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right" valign="bottom">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">7,340</font></td>
    <td WIDTH="3%" align="right" valign="bottom">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Proceeds on disposal of
    long-lived assets in long-term receivable</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">1,723</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">1,855</font></td>
    <td WIDTH="3%" align="right" valign="bottom" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Proceeds on disposal of
    long-lived assets in accounts receivable</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,050</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,050</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Cash and cash equivalents
    consist of:</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Cash balances with banks</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">6,495</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">9,250</font></td>
    <td WIDTH="3%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom"><font SIZE="2">
    <p style="margin-right: 4">27,737</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 52">Short-term investments</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">7,103</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">8,592</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="text-indent: -26; margin-left: 26">&nbsp;</td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">13,598</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">9,250</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">36,329</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">10. Financial instruments: </p>
</b>
<p ALIGN="JUSTIFY">For the interim period ended December 30, 2007, the Company
has adopted the requirements of the CICA Handbook Section 3862, &quot;Financial
Instruments Disclosures&quot;, which apply to fiscal years beginning on or after
October 1, 2007. This new Handbook Section requires disclosures to enable users
to evaluate the significance of financial instruments for the entity's financial
position and performance, and the nature and extent of an entity's exposure to
risks arising from financial instruments, including how the entity manages those
risks. </p>
<p ALIGN="JUSTIFY">Disclosures relating to exposure to risks, in particular
credit risk, liquidity risk, foreign currency risk and interest rate risk, are
included in the section entitled &quot;Financial Risk Management&quot; of the Management's
Discussion and Analysis of the Company's operations, performance and financial
condition as at and for the three months ended December 30, 2007, which is
included in the <i>Gildan Q1 2008 Quarterly Report to Shareholders </i>along
with these interim consolidated financial statements. Accordingly, these
disclosures are incorporated into these interim consolidated financial
statements by cross-reference. </p>
<p align="right">&nbsp;</p>
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.30 </p>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font>
    <td width="50%"><font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right"><br>
    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</i></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">10. Financial instruments (continued): </p>
</b>
<p align="justify">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial
instruments &#150; carrying values and fair values: </p>
<p align="justify">The fair values of financial assets and liabilities, together
with the carrying amounts included in the consolidated balance sheet, are as
follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="20%" COLSPAN="3" align="center"><font SIZE="2">December 30, 2007</font></td>
    <td WIDTH="3%" align="center">&nbsp;</td>
    <td WIDTH="36%" COLSPAN="3" align="center"><font SIZE="2">September 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">Carrying</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">Fair</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">Carrying</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">Fair</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">amount</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">value</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">amount</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">value</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><u>Financial assets</u></font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Available-for-sale financial assets:</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 26">Cash and cash equivalents</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">13,598</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">13,598</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">9,250</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">9,250</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Loans and receivables:</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 26">Accounts receivable - trade</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">136,158</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">136,158</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">189,070</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">189,070</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 26">Accounts receivable - other</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">15,843</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">15,843</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">17,018</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">17,018</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 26">Long-term receivable included in other assets</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,723</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,723</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,855</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,855</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 26">Restricted cash related to Prewett acquisition
    included in other assets</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">10,000</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">10,000</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Forward foreign exchange contracts</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,201</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,201</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">293</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">293</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2"><u>Financial liabilities</u></font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Other financial liabilities</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 26">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">118,880</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">118,880</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">116,683</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">116,683</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 26">Long-term debt - bearing interest at variable
    rates:</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 52">Revolving long-term credit facility</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">120,000</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">120,000</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">49,000</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">49,000</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 52">Other long-term debt</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">8,581</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">8,581</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">8,803</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">8,803</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-left: 26">Long-term debt - bearing interest at fixed rates</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">2,239</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">2,239</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,857</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,857</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forward foreign exchange contracts</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,147</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,147</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,087</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,087</font></td>
  </tr>
</table>
<font FACE="Arial MT" size="2">
<p ALIGN="JUSTIFY">The Company has determined that the fair value of its
short-term financial assets and liabilities approximates their respective
carrying amounts as at the balance sheet dates because of the short-term
maturity of those instruments. The fair values of the long-term receivable and
the restricted cash related to the acquisition of Prewett, and the Company's
interest-bearing financial liabilities also approximates their respective
carrying amounts. The fair value of forward foreign exchange contracts was
determined using quoted market values. </p>
<p>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial income and
expense: </p>
<p>The following components of income and expense relating to financial
instruments are included in the consolidated statement of earnings: </p>
<p style="margin-left: 36pt">(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interest income and expense: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="30%" COLSPAN="3" align="center"><font SIZE="2"><i><b>Three months
    ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
    <td WIDTH="33%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Interest expense on long-term indebtedness</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">2,955</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">678</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%"><font SIZE="2">Interest expense on short-term indebtedness</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">15</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">447</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%" bgcolor="#E6E6E6"><font SIZE="2">Interest income on available-for-sale
    financial assets</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(180)</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(174)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%"><font SIZE="2">Interest income on loans and receivables</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">(20)</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Other interest</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">24</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">20</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="44%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Interest expense - net</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,794</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">971</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY" style="margin-left: 36pt">Interest income on
available-for-sale financial assets consists of interest earned from cash and
cash equivalents invested in short-term deposits. Interest income on loans and
receivables relates to interest earned on the Company's long-term receivable
included in other assets. </p>
</font><font FACE="Times New Roman" SIZE="2">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.31 </p>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font>
    <td width="50%"><font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right"><br>
    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</i></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">10. Financial instruments (continued): </p>
</b>
<p align="justify" style="margin-left: 36pt">(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Foreign exchange gain: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium">
    <p style="text-indent: -26; margin-left: 26">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="3" align="right"><font SIZE="2"><i><b>
    <p align="center">Three months ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <p style="text-indent: -26; margin-left: 26">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 30, 2007</font></td>
    <td WIDTH="26%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Gains relating to financial
    assets and liabilities,excluding forward foreign exchange contracts</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" valign="bottom" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" valign="bottom" bgcolor="#E6E6E6">
    <font SIZE="2">51</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" valign="bottom" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" valign="bottom" bgcolor="#E6E6E6">
    <font SIZE="2">580</font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Gains relating to forward
    foreign exchange contracts, including amounts realized on contract maturity
    and changes in fair value of open positions</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">841</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">210</font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 78">Foreign exchange gain relating
    to financial instruments</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">892</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">790</font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Other foreign exchange (losses)
    gains</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(575)</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,055</font></td>
  </tr>
  <tr>
    <td WIDTH="1%" style="border-style: none; border-width: medium">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="70%" style="border-left-style: none; border-left-width: medium; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="text-indent: -26; margin-left: 78">Foreign exchange gain</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">317</font></td>
    <td WIDTH="3%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" valign="bottom" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">1,845</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p align="justify" style="margin-left: 36pt">(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Impairment losses recognized on trade receivables </p>
<p align="justify" style="margin-left: 70pt">The Company recorded bad debt
expense of $ nil (2007 - $0.1 million) in &quot;Selling, general and administrative
expenses&quot; in the consolidated statement of earnings in the current quarter. </p>
<p align="justify">(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Forward foreign exchange contracts: </p>
<p align="justify" style="margin-left: 36pt">The following table summarizes the
Company's derivative financial instruments relating to commitments to buy and
sell foreign currencies through forward foreign exchange contracts as at
December 30, 2007 and September 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right" height="19"><font SIZE="2"><b><u>
    Carrying &amp; fair value</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>December 30, 2007</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>currency amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>exchange rate</b></font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6"><font SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,331</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.4469</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1,926</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">33</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%"><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">18,208</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0.9950</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">18,117</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">451</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">25,500</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0.9980</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">25,450</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">547</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">5,607</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.3647</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">7,652</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(573)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">8,485</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.3964</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">11,848</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(574)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">5,097</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">1.9996</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">10,192</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">69</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">5,172</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.9952</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10,319</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">101</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000"><font SIZE="2">85,504</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000"><font SIZE="2">1,201</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6" style="border-bottom: 2px solid #000000"><font SIZE="2">(1,147)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right" height="19"><font SIZE="2"><b><u>
    Carrying &amp; fair value</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>September 30, 2007</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>currency amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>exchange rate</b></font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6"><font SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">4,425</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.3616</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6,025</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">293</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4,899</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3626</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">6,675</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(278)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">9,081</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3677</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">12,421</font></td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(467)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6"><font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">4,781</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.9988</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">9,558</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(146)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">6,019</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">1.9841</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">11,942</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(196)</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell CAD/Buy USD</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,800</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.0055</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,821</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="1%">
    <p style="margin-left: 36pt">&nbsp;</td>
    <td WIDTH="24%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">50,442</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">293</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">(1,087)</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.32 </p>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font>
    <td width="50%"><font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right"><br>
    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</i></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">11. Capital disclosures: </p>
</b>
<p ALIGN="JUSTIFY">The Company's objective in managing capital is to ensure
sufficient liquidity to pursue its organic growth strategy and undertake
selective acquisitions, while at the same time taking a conservative approach
towards financial leverage and management of financial risk. </p>
<p ALIGN="JUSTIFY">The Company's capital is composed of net debt and
shareholders' equity. Net debt consists of interest-bearing debt less cash and
cash equivalents. The Company's primary uses of capital are to finance increases
in non-cash working capital and capital expenditures for capacity expansion as
well as acquisitions. The Company currently funds these requirements out of its
internally-generated cash flows and the periodic use of its revolving long-term
bank credit facility. </p>
<p ALIGN="JUSTIFY">The primary measure used by the Company to monitor its
financial leverage is its ratio of net debt to earnings before interest, taxes,
depreciation and amortization, non-controlling interest, and restructuring and
other charges (&quot;EBITDA&quot;), which it aims to maintain at less than a maximum
3.0:1. The terms of the revolving credit facility permit the Company to exceed
this limit under certain circumstances. Net debt is computed as at the most
recent quarterly balance sheet date. EBITDA is based on the last four quarters
ending on the same date as the balance sheet date used to compute net debt. The
net debt to EBITDA ratio as at December 30, 2007 and December 31, 2006 was as
follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 30, 2007</font></td>
    <td WIDTH="31%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Bank indebtedness</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">-</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">3,500</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Current portion of long-term debt</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">4,589</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">21,518</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Long-term debt</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">126,231</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">10,635</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Less: cash and cash equivalents</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(13,598)</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(36,329)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">Net debt</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">117,222</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">(676)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="43%" COLSPAN="3" align="right"><font SIZE="2"><i><b>For the last
    four quarters ending on</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="23%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 30, 2007</font></td>
    <td WIDTH="31%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">December 31, 2006</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">141,883</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">106,245</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Restructuring and other charges</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">27,444</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">21,777</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">42,850</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">33,727</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">6,721</font></td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4"><font SIZE="2">3,472</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Income tax (recovery) expense</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(3,820)</font></td>
    <td WIDTH="3%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">5,118</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Non-controlling interest in income of consolidated joint
    venture</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">
    <font SIZE="2">1,633</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">
    <font SIZE="2">304</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">EBITDA</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">216,711</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">170,643</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="3%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">Net debt to EBITDA ratio</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">0.5:1</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2">0.0:1</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The Company used its revolving credit facility to finance the
acquisition of Prewett, which closed on October 15, 2007. The financing of the
acquisition resulted in debt leverage which was still well below the Company's
maximum net debt to EBITDA ratio of 3.0:1. The Company does not currently plan
to refinance its revolving credit facility, or a portion thereof, with debt of
longer maturities or to raise additional equity capital. </p>
<p ALIGN="JUSTIFY">In order to maximize flexibility to finance our ongoing
growth and expansion and be able to take advantage of additional new capital
investment and acquisition opportunities, we do not currently pay a dividend.
Periodically, the merits of introducing a dividend are evaluated by the
Company's Board of Directors. </p>
<p>The Company is not subject to any capital requirements imposed by a
regulator. </p>
</font><font FACE="Times New Roman" SIZE="2">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.33 </p>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font>
    <td width="50%"><font FACE="Times New Roman PS" SIZE="2"><i>
    <p align="right"><br>
    NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</i></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p align="justify">12. Segmented information: </p>
</b>
<p align="justify">The Company manufactures and sells activewear, socks and
underwear. The Company operates in one business segment, being high-volume,
basic, frequently replenished, non-fashion apparel. </p>
<p ALIGN="JUSTIFY">The Company has two customers accounting for at least 10% of
total sales. For the three-month period ended December 30, 2007, Customer A
accounted for 23.3% of total sales and Customer B accounted for 21.2%. For the
three-month period ended December 31, 2006, Customer A accounted for 10.0% of
total sales and Customer B accounted for 19.0%. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="28%" COLSPAN="4" align="center"><font SIZE="2"><i><b>
    <p style="margin-right: 4">Three months ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="14%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 30, 2007</u></font></td>
    <td WIDTH="28%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 31, 2006</u></font></td>
  </tr>
  <tr>
    <td WIDTH="51%" COLSPAN="2" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sales were derived from customers located in the following
    geographic areas:</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" bgcolor="#E6E6E6"><font SIZE="2">United States</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">229,709</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">169,064</font></td>
  </tr>
  <tr>
    <td WIDTH="54%"><font SIZE="2">Canada</font></td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">9,936</font></td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">7,965</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Europe and other</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">10,812</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">8,800</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">250,457</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">185,829</font></td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sales by major product group:</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" bgcolor="#E6E6E6"><font SIZE="2">Activewear and underwear</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">168,448</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">143,272</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Socks</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">82,009</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">42,557</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">250,457</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">185,829</font></td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="13%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 30, 2007</u></font></td>
    <td WIDTH="14%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>September 30, 2007</u></font></td>
    <td WIDTH="28%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4"><u>December 31, 2006</u></font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Property, plant and equipment by geographic areas are as
    follows:</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(audited)</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="54%" bgcolor="#E6E6E6"><font SIZE="2">Caribbean Basin and Central America</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">315,079</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">294,063</font></td>
    <td WIDTH="2%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">217,868</font></td>
  </tr>
  <tr>
    <td WIDTH="54%"><font SIZE="2">United States</font></td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">83,573</font></td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">65,399</font></td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">71,021</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Canada and other</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">14,651</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">18,155</font></td>
    <td WIDTH="2%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">29,118</font></td>
  </tr>
  <tr>
    <td WIDTH="54%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">413,303</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">377,617</font></td>
    <td WIDTH="2%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">318,007</font></td>
  </tr>
</table>
<p>&nbsp;</p>
<font FACE="Times New Roman" SIZE="2">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.34 </p>
<hr color="#000000" size="5"></font>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>gildanexh992.htm
<DESCRIPTION>EXHIBIT 99.2
<TEXT>
<html>

<head>
<title>Gildan Activewear Inc: Form 6-K - Prepared by TNT Filings Inc.</title>
</head>

<body>

<div style="border-top-style: solid; border-top-width: 1; padding-top: 1">
  <hr color="#000000" size="5">
</div>
<p align="center"><img border="0" src="gildan1.gif" width="267" height="78"></p>
<font FACE="Times New Roman" SIZE="7" color="#005AAC"><b>
<p align="left">Q1 2008 <br>
</b></font><font FACE="Arial MT" SIZE="7">QUARTERLY <br>
REPORT TO <br>
SHAREHOLDERS</font><font FACE="Times New Roman PSMT"> </p>
</font>
<p align="center"><img border="0" src="gildan2.gif" width="100%" height="402"></p>
<hr color="#000000" size="5"><p Style='page-break-before:always'><font SIZE="1" face="Times New Roman">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p align="justify"><font color="#007CBC">This Management's discussion and
analysis (MD&amp;A) comments on Gildan's operations, performance and financial
condition as at and for the three months ended December 30, 2007, compared to
the corresponding periods in the previous year. For a complete understanding of
our business environment, trends, risks and uncertainties and the effect of
accounting estimates on our results of operations and financial condition, this
interim MD&amp;A should be read together with the unaudited interim consolidated
financial statements as at and for the three months ended December 30, 2007 and
the related notes, and with our MD&amp;A for the year ended September 30, 2007 (2007
Annual MD&amp;A), which is part of the fiscal 2007 Annual Report. This MD&amp;A is dated
February 7, 2008. All amounts in this report are in U.S. dollars, unless
otherwise noted. </font></p>
<p align="justify"><font color="#007CBC">All financial information contained in
this interim MD&amp;A and in the interim consolidated financial statements has been
prepared in accordance with Canadian generally accepted accounting principles (GAAP),
except for certain information discussed in the paragraph entitled &quot;Non-GAAP
Financial Measures&quot; on page 5 of this MD&amp;A. The unaudited consolidated financial
statements and this MD&amp;A were reviewed by Gildan's Audit and Finance Committee
and were approved by our Board of Directors. </font></p>
<p align="justify"><font color="#007CBC">Additional information about Gildan,
including our 2007 Annual Information Form, is available on our website at
www.gildan.com, on the SEDAR website at www.sedar.com, and on the EDGAR section
of the U.S. Securities and Exchange Commission website (which includes the
Annual Report on Form 40-F) at www.sec.gov. </font></p>
<p align="justify"><font color="#007CBC">This document contains forward-looking
statements, which are qualified by reference to, and should be read together
with the &quot;Forward-looking Statements&quot; cautionary notice on page 20. </font></p>
<p align="justify"><font color="#007CBC">In this MD&amp;A, &quot;Gildan&quot;, the &quot;Company&quot;,
or the words &quot;we&quot;, &quot;us&quot;, &quot;our&quot; refer, depending on the context, either to Gildan
Activewear Inc. or to Gildan Activewear Inc. together with its subsidiaries and
joint venture. </font></p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#007CBC"><b>OUR BUSINESS</b></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">Gildan is a vertically-integrated marketer and manufacturer
of activewear, underwear and socks. The Company operates in one business
segment, being high-volume, basic, frequently replenished, non-fashion apparel.
We are the leading supplier of activewear for the wholesale imprinted sportswear
market in the U.S. and Canada, and also a leading supplier for this market in
Europe. As part of our growth strategy to sell our products into the mass-market
retail channel in North America, we expanded our product-line in 2006 to include
socks and underwear. We are now one of the leading suppliers of socks in the
U.S. mass-market retail channel. </p>
<p ALIGN="JUSTIFY">Effective October 15, 2007, we acquired 100% of the capital
stock of V.I. Prewett &amp; Son, Inc. (Prewett), a U.S. supplier of basic family
socks to U.S. mass-market retailers. Prewett's corporate headquarters are
located in Fort Payne, Alabama. The acquisition is intended to further enhance
Gildan's position as a full-product supplier of socks, activewear and underwear
for the retail channel. We paid $125 million on closing, and also placed $10
million in escrow to provide for a further contingent increase in the purchase
price of the acquisition. The funds were drawn under our revolving long-term
credit facility. We accounted for this acquisition using the purchase method and
the results of Prewett were consolidated with those of Gildan from the date of
acquisition. </p>
<b>
<p align="justify">Our Products <br>
</b>
We specialize in marketing and large-scale manufacturing of
basic, non-fashion apparel products for customers requiring an efficient supply
chain and consistent product quality for high-volume automatic replenishment
programs. </p>
<p ALIGN="JUSTIFY">We sell activewear, namely T-shirts, fleece and sport shirts,
in large quantities to wholesale distributors as undecorated &quot;blanks&quot;, which are
subsequently decorated by screenprinters with designs and logos. We sell our
products to wholesale distributors under the Gildan brand. Consumers ultimately
purchase the Company's products in venues such as sports, entertainment and
corporate events, and travel and </font><font FACE="Arial MT" SIZE="2">tourism
destinations. The Company's products are also utilized for work uniforms and
other end-uses to convey individual, group and team identity. In the retail
channel, we have complemented our activewear product-line with a variety of
styles of socks and men's and boys' underwear. We sell these products to
mass-market and regional retailers in North America under the Gildan brand and
under various retailer private label programs. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.2 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'><font FACE="Times New Roman" SIZE="2"><b>
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    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
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    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
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</table>
<p align="justify">Our Manufacturing and Distribution Facilities
</b>
<u><br>
Textile and Sock Manufacturing <br>
</u>To support our sales in various markets, we have built and
are continuing to build modern manufacturing facilities located in Central
America and the Caribbean Basin where we manufacture all of our T-shirts,
fleece, sport shirts and underwear. Our largest manufacturing hub in Central
America includes our first integrated knitting, bleaching, dyeing, finishing and
cutting facility in Rio Nance, Honduras, which became operational in 2002. In
addition, during 2007, we commenced production at our new state-of-the-art
integrated sock manufacturing facility and at our new integrated textile
facility for the production of activewear, both in Rio Nance, Honduras. We
expect to complete the expansion of our new sock and activewear facilities by
the third quarter of fiscal 2008. In August 2007, we announced plans for a
second sock facility to support our projected continuing growth in sales, which
is expected to be constructed and ramped up over twenty-four months. In
addition, we are also evaluating the timing and geographical location for future
textile capacity expansion, to support our ongoing growth initiatives in the
U.S. mass-market retail and international markets. </p>
<p ALIGN="JUSTIFY">We have also established a vertically-integrated Caribbean
Basin manufacturing hub with a textile facility for the production of activewear
in Bella Vista, Dominican Republic, which began commercial operations in fiscal
2005 and is currently running at a comparable scale of production to our mature
textile facility in Honduras. </p>
<p ALIGN="JUSTIFY">In addition to our integrated sock manufacturing facility
located in our Central America manufacturing hub, we have a U.S. sock
manufacturing facility in Hillsville, Virginia, and as a result of the Prewett
acquisition, we have sock manufacturing facilities in Fort Payne, Alabama. </p>
<p align="justify">Our land and infrastructure in Central America and the
Caribbean Basin can accommodate further capacity expansion on the same sites.
</p>
<p align="justify"><u>Yarn-Spinning </u><br>
CanAm Yarns, LLC (CanAm), our joint-venture company with
Frontier Spinning Mills, Inc. (Frontier), operates yarn-spinning facilities in
Georgia and North Carolina. CanAm's yarn-spinning operations, together with
supply agreements currently in place with Frontier and other third-party yarn
providers, serve to meet our yarn requirements. </p>
<p align="justify"><u>Sewing <br>
</u>Our sewing facilities are located in Central America and the
Caribbean Basin. We also utilize third-party contractors, primarily in Haiti, to
complement our vertically-integrated sewing production. </p>
<p align="justify"><u>Distribution <br>
</u>We distribute our products for the wholesale imprinted
sportswear market in the U.S. primarily out of our company-owned distribution
centre in Eden, North Carolina, and also use third-party warehouses in the
western United States, Canada, Mexico, Europe and Asia to service our customers
in these markets. We also operate distribution centres in Martinsville, Virginia
and Fort Payne, Alabama dedicated to servicing the retail channel. We are also
developing facilities to enhance our ability to provide direct shipments from
our Central American and Caribbean Basin manufacturing hubs. </p>
<p align="justify"><u>Corporate Head Office and Employees <br>
</u>Our corporate head office is located in Montreal, Canada and
we currently employ more than 16,000 full-time employees worldwide. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.3 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
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    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
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    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">Market Overview <br>
</b>
Our target market for activewear, socks and underwear is
characterized by low fashion risk compared to many other apparel markets, since
our products are basic and produced in a limited range of sizes, colours and
styles, and since logos and designs for the screenprint market are not imprinted
or embroidered by Gildan. </p>
<p align="justify">The apparel market for our products is highly competitive.
Competition is generally based upon price, with reliable quality and service
also being key requirements for success. Our primary competitors in North
America are the major U.S.-based manufacturers of basic family apparel for the
wholesale and retail channels, such as the Hanes, Fruit of the Loom, and Jerzees
brands. The competition in the European wholesale imprinted activewear market is
similar to that in North America, as we compete primarily with the European
divisions of the larger U.S.-based manufacturers. In Europe, we also have large
competitors, which do not have integrated manufacturing operations and source
products from contractors in Asia. In addition, we face the threat of increasing
global competition. In particular, the U.S. sock industry is subject to global
competition, including significant imports from Asia. </p>
<p align="justify">We believe that growth for activewear products has been
driven by several market trends such as the following: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2" face="Times New Roman">continued use of activewear for event
  merchandising (such as concerts, festivals, etc.); </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">continued evolution of the
  entertainment/sports licensing and merchandising businesses; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">the growing use of activewear for
  uniform applications; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">the growing use of activewear for
  corporate promotions; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">continued increase in use of activewear
  products for travel and tourism; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">an increased emphasis on physical
  fitness; and </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">a greater use and acceptance of casual
  dress in the workplace. </li>
</ul>
<p align="justify">In addition, reductions in manufacturing costs, combined with
quality enhancements in activewear apparel, such as pre-shrunk fabrics, improved
fabric weight, blends and construction, as well as an increased range of colours
and styles have provided consumers with superior products at lower prices. </p>
<p align="justify">We believe that providing a superior value proposition
predicated on reliable product quality and comfort, combined with efficient
customer service and competitive pricing, will continue to be key drivers of
success in both the wholesale and retail channels. </p>
<p align="justify">Due to wholesaler and retailer consolidation, the customer
base to which we sell and are targeting to sell our products is composed of a
relatively small number of significant customers. This concentration is not
unusual in the mass-market retail channel. </p>
<p align="justify">The continued consolidation of the number of suppliers by
retailers looking for the convenience of a full-line supplier of a product
category for the entire family could create growth opportunities for our
products. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><font color="#007CBC"><b>Strategy and Objectives </b>
  </font>
</div>
<p align="justify">We believe that our success in developing our
vertically-integrated manufacturing hubs has allowed us to provide our customers
with low prices, consistent product quality and a reliable supply chain, and has
been the main reason that we have been able to continue to increase our market
presence and establish our market leadership in the imprinted sportswear market.
These are the same factors that management believes will support Gildan's
success in building a consumer brand in the retail channel. </p>
<p align="justify">We are able to price our products competitively because of
our success in reducing operating costs. We accomplish this by: </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.4 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
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    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font FACE="Times New Roman" SIZE="2">investing in modern, automated equipment
  and facilities; </li>
  </font><font FACE="Symbol MT" LANG="JA" SIZE="2">
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2" face="Times New Roman">increasing our capacity through the
  development of integrated regional hubs in Central America and the Caribbean
  Basin, where we benefit from strategic locations and favourable international
  trade agreements; and </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0">
  <font SIZE="2" face="Times New Roman">focusing on producing a narrow range of
  basic, high-volume product-lines, which allows us to maximize production
  efficiencies. </li>
</ul>
<p align="justify">We intend to continue to expand capacity through the
acquisition of modern, automated equipment for all aspects of our manufacturing
process to maximize productivity and achieve high efficiency rates. </p>
<p align="justify">Our growth strategy comprises the following five initiatives:
</p>
<ol>
  <li>
  <p align="justify">Continue to increase market share in the U.S. wholesale
  imprinted sportswear market in all product categories </li>
  <li>
  <p align="justify">Leverage our successful business model to penetrate the
  mass-market retail channel and develop Gildan as a consumer brand </li>
  <li>
  <p align="justify">Pursue international growth opportunities </li>
  <li>
  <p align="justify">Continue to generate significant manufacturing cost
  reductions </li>
  <li>
  <p align="justify">Re-invest free cash flow to pursue selective complementary
  acquisitions. </font><font FACE="Courier New PSMT" SIZE="2"></li>
</ol>
</font><font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">We are subject to a variety of business risks that may affect
our ability to maintain our current market share and profitability, as well as
our ability to achieve our long-term strategic objectives. These risks are
described in this interim MD&amp;A under the heading &quot;Risks and Uncertainties&quot; and
in the &quot;Risks and Uncertainties&quot; section of our 2007 Annual MD&amp;A. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><b><font color="#007CBC">Operating Results </font></b>
</div>
<b>
<p align="justify">Non-GAAP Financial Measures <br>
</b>
We use non-GAAP measures to assess our operating performance.
Securities regulations require that companies caution readers that earnings and
other measures adjusted to a basis other than GAAP do not have standardized
meanings and are unlikely to be comparable to similar measures used by other
companies. Accordingly, they should not be considered in isolation. We use non-GAAP
measures such as adjusted net earnings, adjusted diluted EPS, EBITDA, free cash
flow, total indebtedness and net indebtedness to measure our performance from
one period to the next without the variation caused by certain adjustments that
could potentially distort the analysis of trends in our operating performance,
and because we believe such measures provide meaningful information on the
Company's financial condition and operating results. </p>
<p ALIGN="justify">We refer the reader to page 18 for the definition and
complete reconciliation of all non-GAAP financial measures used and presented by
the Company to the most directly comparable GAAP financial measures. </p>
<b>
<p align="justify">Summary of Quarterly Results <br>
</b>
The table below sets forth certain summarized unaudited
quarterly financial data for the eight most recently completed quarters. This
quarterly information is unaudited but has been prepared on the same basis as
the annual audited consolidated financial statements. The operating results for
any quarter are not necessarily indicative of the results to be expected for any
period. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.5 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
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    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="28%">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
    <td WIDTH="9%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">2008</b></font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">2007</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">2006</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><i>(in $ millions, except per share
    amounts) <sup>(1)</sup></i></font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">Q1</b></font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q2</font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">Q2</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sales</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">250.5</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">254.9</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">291.6</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">232.1</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">185.8</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">235.2</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">233.9</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">183.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">Net earnings</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">27.5</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">40.9</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">52.4</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">21.1</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">15.6</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">16.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">42.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">31.0</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Net earnings per share</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 5">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Basic EPS</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">0.23</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.34</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.44</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.18</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.13</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.14</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.36</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.26</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Diluted EPS</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">0.23</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.34</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.43</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.17</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.13</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.14</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.35</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">0.26</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">Total assets</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">995.4</b></font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">874.5</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">825.0</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">795.6</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">715.8</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">723.3</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">673.1</font></td>
    <td WIDTH="9%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">643.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Total long-term
    financial liabilities <sup>(2)</sup></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">174.2</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">87.5</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">73.5</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">88.4</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">44.2</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">47.1</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">46.4</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">64.8</font></td>
  </tr>
  <tr>
    <td WIDTH="28%"><font FACE="Times New Roman" SIZE="2">
    <p style="text-indent: -26; margin-left: 26">Average number of shares
    outstanding <i>(in thousands)</i></font></td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 5">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="28%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Basic</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">120,428</b></font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,401</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,359</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,320</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,278</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,209</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,155</font></td>
    <td WIDTH="9%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">120,108</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-left: 26">Diluted</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 5">121,656</b></font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,577</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,599</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,529</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,447</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,340</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,254</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 5">121,294</font></td>
  </tr>
</table>
<font FACE="Times New Roman" style="font-size: 9pt"><i><sup>
<p style="margin-top: 0; margin-bottom: 0" align="justify">(1) </sup>Quarterly
results reflect the acquisition of Prewett on October 15, 2007 (Q1 2008) and
Kentucky Derby Hosiery Co., Inc. on July 6, 2006 (Q4 2006) from their respective
dates of acquisition.</p>
<sup>
<p style="margin-top: 0; margin-bottom: 0" align="justify">(2) </sup>Represents
sum of long-term debt, future income taxes and non-controlling interest.</p>
</i></font><font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The activewear business is seasonal and we have historically
experienced quarterly fluctuations in operating results. Typically, demand for
our T-shirts is highest in the third quarter of each fiscal year, when
distributors purchase inventory for the peak summer selling season, and lowest
in the first quarter of each fiscal year. Demand for fleece is typically
highest, as a result of cooler weather, in the third and fourth quarters of each
fiscal year. The seasonality of specific product-lines is consistent with that
experienced by other companies in the activewear industry. Throughout the year,
we operate our mature facilities at full capacity in order to be cost efficient.
Consequently, with the seasonal sales trends of our business, we experience
fluctuations in our inventory levels throughout the year. For our sock products,
demand is typically highest in the first and fourth quarters of each fiscal
year, stimulated largely by the cooler weather, the need to support requirements
for the back-to-school period and the peak retail selling during the Christmas
holiday season. Management anticipates that the seasonality we have historically
experienced will continue in the future, although it is expected to be somewhat
mitigated by our product diversification. </p>
<b>
<p align="justify">Business Acquisition <br>
</b>
On October 15, 2007, we acquired 100% of the capital stock of
Prewett, a U.S. supplier of basic family socks to U.S. mass-market retailers.
Prewett's corporate headquarters are located in Fort Payne, Alabama. The
acquisition is intended to enhance further the Company's position as a
full-product supplier of socks, activewear and underwear for the retail channel. </p>
<p ALIGN="JUSTIFY">The aggregate purchase price of $125 million paid in cash on
closing is subject to adjustments based on working capital balances as at the
date of acquisition, which have not yet been finalized. In addition, the
purchase agreement provides for an additional purchase consideration of $10
million contingent on specified future events. This amount was paid into escrow
by Gildan and is included in &quot;Other assets&quot; on the consolidated balance sheet.
Any further purchase price consideration paid by the Company will be accounted
for as additional goodwill. </p>
<p>We accounted for this acquisition using the purchase method and the results
of Prewett have been consolidated with those of the Company from the date of
acquisition. </p>
<p ALIGN="JUSTIFY">We have allocated the purchase price on a preliminary basis
to the assets acquired and the liabilities assumed based on management's best
estimate of their fair values and taking into account all relevant information
available at that time. Since we are still in the process of finalizing the
valuation of certain intangible assets and other assets acquired and liabilities
assumed at the date of acquisition, the allocation of the purchase price is
subject to change. The Company expects to finalize the purchase price allocation
by the end of fiscal 2008. We refer the reader to Note 4 of the interim
consolidated financial statements for a summary of the estimated fair value of
assets acquired and liabilities assumed at the date of acquisition. </p>
<b>
<p align="justify">Sales <br>
</b>
Sales for the first quarter, which is seasonally the lowest quarter of the
fiscal year for sales of activewear, amounted to $250.5 million, up 34.8% from
$185.8 million in the first quarter of fiscal 2007. The increase in </font>
<font FACE="Arial MT" SIZE="2">sales revenues was due to an increase of 92.7% or
$39.4 million in sock sales due to the acquisition of Prewett and new retail
sock programs obtained in fiscal 2007, a 13.7% increase in unit sales volumes
for activewear, and an increase of approximately 2.5% in activewear unit selling
prices. The growth in sales was achieved in spite of the elimination during
fiscal 2007 of unprofitable sock product-lines, which did not fit with Gildan's
strategy. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.6 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Market growth and share data presented for the U.S. wholesale
distributor channel is based on the S.T.A.R.S. Report produced by ACNielsen
Market Decisions. The table below summarizes the S.T.A.R.S. data for the quarter
ended December 31, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Three months ended December
    31</b></font></td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Three months ended December
    31</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2007 vs 2006</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2007</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>2006</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 55">
    <font SIZE="2"><b>Unit Growth</b></font></td>
    <td COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 50">
    <font SIZE="2"><b>Market Share</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Industry</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Gildan</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">All Products</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">15.1%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">3.0%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>49.3%</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">44.2%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">T-shirts</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">13.6%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">4.3%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>50.0%</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">46.0%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Fleece</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">30.3%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">(4.6)%</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>49.1%</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">36.0%</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Sport shirts</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">2.4%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.3%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>35.4%</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">34.6%</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The increase in activewear unit sales was due to continuing
market share penetration in all product categories in the U.S. distributor
channel and an increase of 3.0% in overall industry shipments from U.S.
distributors to screenprinters during the three months ended December 31, 2007.
In the T-shirt category, sales volumes of Gildan T-shirts by U.S. distributors
to screenprinters grew by 13.6% for the quarter ended December 31, 2007, and our
leading share in this category increased to 50.0%. Unit volume growth of Gildan
fleece products from U.S. distributors to screenprinters totaled 30.3%, compared
to an overall decline of 4.6% for the industry. Our leading market share in this
category increased to 49.1%. We increased our leading brand position in sport
shirts by achieving a 35.4% market share, and sales volumes of Gildan sport
shirts from U.S. distributors to screenprinters grew by 2.4%, while growth for
the industry was essentially flat. </p>
<p align="justify">During the first quarter of fiscal 2008, the Company obtained its first
underwear program with a U.S. national mass-market retailer. Shipments for this
program are expected to begin in May of 2008. </p>
<p ALIGN="JUSTIFY">In addition to our growth in U.S. markets, unit shipments to
Canada, Europe, Asia/Pacific and Mexico increased by 19.3%, compared to the
first quarter of fiscal 2007. The Company has leased warehouse space in Shenzen,
China with a third-party logistics provider, to support its growth objectives in
the Chinese market. </p>
<b>
<p align="justify">Gross Profit <br>
</b>
Gross profit for the first quarter of fiscal 2008 was $78.9
million, or 31.5% of sales, compared to $53.9 million, or 29.0% of sales during
the first quarter of fiscal 2007. The increase in gross margins was due to
higher activewear selling prices and increased manufacturing efficiencies for
activewear. Gross margins include the negative impact of the consumption of
opening textile and sock inventories produced at higher cost structures prior to
our consolidation of our manufacturing in our offshore facilities. Gross margins
were also impacted by sock inventory write-downs in the first quarter of fiscal
2008 due to our decision to accelerate the liquidation of unprofitable
product-lines which have been discontinued. In addition, the Prewett sock
business currently generates lower gross margins than Gildan's activewear
business. </p>
<b>
<p align="justify">Selling, General and Administrative Expenses <br>
</b>
Selling, general and administrative (SG&amp;A) expenses in the
first quarter of fiscal 2008 were $32.6 million, or 13.0% of sales, compared to
$26.1 million, or 14.1% of sales, in the first quarter of last year. The overall
increase in SG&amp;A expenses was due to the impact of the acquisition of Prewett,
higher distribution costs, and increased administrative and information
technology costs to support our continuing growth strategy. Administrative
expenses were also impacted by the stronger Canadian dollar. The impact of these
higher <font FACE="Arial MT" SIZE="2">costs was partially offset by the
non-recurrence of a $1.1 million charge incurred in the first quarter of fiscal
2007 for the replacement of the Company's leased aircraft. </p>
</font></font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.7 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p align="justify">Restructuring and Other Charges <br>
</b>
In fiscal 2006 and 2007, we announced the closure, relocation
and consolidation of manufacturing and distribution facilities in Canada, the
United States and Mexico, as well as the relocation of Gildan's corporate
office. The costs incurred in connection with these announcements have been
recorded as restructuring and other charges, and included severance and other
exit costs, asset impairment losses and accelerated depreciation resulting from
the reduction in the estimated remaining economic lives of property, plant and
equipment at these facilities. Restructuring charges of $0.8 million in the
first quarter of fiscal 2008 includes other exit costs of $1.1 million incurred
in connection with the closures noted above, including carrying and dismantling
costs associated with assets held for sale, less a gain of $0.3 million
recognized on the disposal of assets held for sale. We expect to incur
additional carrying costs relating to the closed facilities being held for sale,
which will be accounted for as restructuring charges as incurred during fiscal
2008, until all property, plant and equipment related to the closures are
disposed of. Any gains or losses on the disposition of the assets held for sale
will also be accounted for as restructuring charges as incurred. </p>
<p ALIGN="JUSTIFY">Restructuring charges of $1.4 million in the first quarter of
fiscal 2007 were composed of $1.1 million of accelerated depreciation, primarily
related to the closures noted above, and $0.3 million of additional severance
costs and carrying costs relating to closed facilities. </p>
<b>
<p align="justify">Depreciation and Interest Expense <br>
</b>
Depreciation and amortization expense increased to $12.8
million in the first quarter of fiscal 2008, compared to $8.8 million in the
first quarter of fiscal 2007. The increase in depreciation and amortization
expense was due to a higher capital asset base resulting from the Company's
continuing investments in capacity expansion, combined with the impact of the Prewett acquisition. </p>
<p ALIGN="JUSTIFY">Net interest expense amounted to $2.8 million in the first
quarter of fiscal 2008, up $1.8 million from $1.0 million in the same period
last year mainly due to the increase in amounts drawn under our revolving
long-term credit facility to fund the acquisition of Prewett, effective October
15, 2007. </p>
<b>
<p align="justify">Income Taxes <br>
</b>
Income tax expense for the first quarter of fiscal 2008 was
$2.1 million compared to an income tax expense of $1.1 million in the first
quarter of fiscal 2007. Excluding the impact of restructuring and other charges,
the effective income tax rate in the first quarter of fiscal 2008 was 6.8%
compared to an effective income tax rate of 6.0% for the same period last year.
The increase in the effective income tax rate was mainly due to our operations
in the U.S, including our acquisition of Prewett, which was effective October
15, 2007, and higher income from our Canadian operations, both of which are
taxed at higher effective income tax rates. </p>
<b>
<p align="justify">Net Earnings <br>
</b>
Net earnings for the quarter were $27.5 million, or $0.23 per
share, on a diluted basis (EPS), up respectively 76.3% and 76.9% from net
earnings of $15.6 million, or $0.13 per share, in the same period last year.
Included in net earnings were restructuring and other charges, which related to
our previously announced restructuring of our Canadian and U.S. manufacturing
facilities totalling $0.8 million, or $0.01 per share in the first quarter of
fiscal 2008 and $1.4 million, or $0.01 per share in the first quarter of fiscal
2007. Before reflecting the restructuring charges in both fiscal years, adjusted
net earnings and adjusted diluted EPS for the first quarter of fiscal 2008
increased respectively 66.5% and 64.3% from adjusted net earnings of $17.0
million or $0.14 per share in the first quarter last year. The growth in EPS was
primarily due to higher unit sales volumes, selling prices and manufacturing
efficiencies for activewear. As a result of the same factors, diluted EPS was
$0.02 higher than the earnings guidance previously provided by the Company. The
acquisition of Prewett was accretive by $0.01 per share after taking into
account financing costs. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.8 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><font color="#007CBC"><b>Financial Condition </b></font>
</div>
<p ALIGN="JUSTIFY">Accounts receivable decreased to $152.0 million in the first
quarter of fiscal 2008 from $206.1 million at September 30, 2007 and grew by
$53.7 million compared to the first quarter of the prior year. The decrease in
accounts receivable from the end of fiscal 2007 reflected the low seasonal level
of sales and a decline in days sales outstanding consistent with prior years due
to seasonal programs invoiced with payment terms maturing in the first quarter,
partially offset by the inclusion of accounts receivable from the Prewett
acquisition. The increase in accounts receivable compared to the first quarter
of fiscal 2007 was mainly due to the 17.2% increase in activewear sales in the
first quarter over the prior year and the inclusion of the accounts receivable
from the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Inventories of $294.5 million were up $54.6 million, or 22.8%
from September 30, 2007 and up $61.0 million, or 26.1% compared to the first
quarter of fiscal 2007. The increase in inventories compared to both periods
reflected the inclusion of inventories from the Prewett acquisition. The
remaining increase in inventories from September 30, 2007 reflected the seasonal
rebuilding of inventories, in line with our requirements to support our
projected sales. The remaining year-over-year inventory increase was in line
with the growth of our activewear business over the prior year. </p>
<p ALIGN="JUSTIFY">Property, plant and equipment, which are net of accumulated
depreciation and asset impairment losses, amounted to $413.3 million at the end
of the first quarter of fiscal 2008, up $35.7 million from September 30, 2007.
This increase was primarily due to the inclusion of $19.3 million of property,
plant and equipment from the acquisition of Prewett, net capital expenditures of
$34.2 million, mainly for the capacity expansion projects in Honduras, partially
offset by depreciation of $11.6 million and a reclassification of property,
plant and equipment to assets held for sale of $6.1 million related to the land
and building of our corporate head office. </p>
<p ALIGN="JUSTIFY">Other assets at the end of the first quarter of fiscal 2008
amounted to $20.5 million, up from $11.4 million at September 30, 2007. The
increase reflected $10 million which was placed in escrow to provide for a
further contingent increase in the purchase price of the acquisition of Prewett
effective October 15, 2007. </p>
<p align="justify">Goodwill and other identifiable intangible assets amounted to
$65.7 million as at December 30, 2007 compared to $2.0 million as at September
30, 2007, as a result of the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Total assets were $995.4 million at December 30, 2007,
compared to $874.5 million at September 30, 2007 and $715.8 million at the end
of the first quarter of fiscal 2007. Working capital was $343.7 million at the
end of the first quarter of fiscal 2008 compared to $342.5 million at September
30, 2007 and $254.7 million at December 31, 2006. </p>
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <p align="justify"><b><font color="#007CBC">Cash Flows and Liquidity and
  Capital Resources </font></b>
</div>
<b>
<p align="justify">Cash Flows <br>
</b>
Cash flows from operating activities in the first quarter of
fiscal 2008 were $103.4 million, compared to $39.5 million for the previous
year. The increase in cash inflow was mainly due to higher cash operating
earnings, a larger seasonal decrease in accounts receivable and a lower seasonal
increase in inventories compared to the first quarter of fiscal 2007. </p>
<p ALIGN="JUSTIFY">Cash flows used in investing activities were $169.2 million
in the first quarter of fiscal 2008, compared to $30.9 million in the same
period last year, mainly as a result of the acquisition of Prewett, effective
October 15, 2007 for a purchase price of $125 million, plus a contingent payment
of $10 million, which was placed in escrow. Net capital expenditures in the
first quarter of fiscal 2008 amounted to $34.2 million, up $3.9 million from the
first quarter of fiscal 2007. The increase was mainly due to higher spending for
our major textile and sock manufacturing capacity expansion projects in
Honduras. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.9 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p align="justify">Free cash flow<sup>(1)</sup> amounted to $71.0 million in the
first quarter of fiscal 2008, up significantly from free cash flow of $8.6
million in the first quarter of fiscal 2007, mainly as a result of higher cash
operating earnings. </p>
<p ALIGN="JUSTIFY">Cash flows from financing activities in the first quarter of
fiscal 2008 were $70.2 million and consisted primarily of an increase in amounts
drawn under our revolving long-term credit facility to fund the acquisition of
Prewett. This compared to cash outflows of $1.3 million in the same period last
year, which resulted primarily from reduction of long-term debt of Kentucky
Derby and our joint venture. </p>
<p ALIGN="JUSTIFY">We ended the first quarter of fiscal 2008 with cash and cash
equivalents of $13.6 million compared to $36.3 million at the end of the first
quarter last year and $9.3 million at September 30, 2007. Total indebtedness as
at December 30, 2007 amounted to $130.8 million compared to $59.7 million at
September 30, 2007 and $35.6 million at December 31, 2006. The year-over-year
increase in total indebtedness resulted mainly from the increase in long-term
debt from the use of our revolving credit facility to fund the acquisition of
Prewett. </p>
<b>
<p align="justify">Liquidity and Capital Resources <br>
</b>
In recent years, we have funded our operations and capital
requirements with cash generated from operations. A revolving credit facility
has been periodically utilized to finance seasonal peak working capital
requirements. Our primary use of funds on an ongoing basis is related to capital
expenditures for new manufacturing facilities, inventory financing, accounts
receivable funding, and business acquisitions. </p>
<p ALIGN="JUSTIFY">On October 15, 2007, we paid $125 million on closing of the
Prewett acquisition and also placed $10 million in escrow to provide for a
further contingent increase in the purchase price of the acquisition. The funds
were drawn under our revolving long-term credit facility. On October 30, 2007,
we increased our revolving long-term credit facility, which expires on June 28,
2012 and which is subject to a one-year extension on an annual basis, to $400
million. This facility is now on an unsecured basis. As at the end of the first
quarter of fiscal 2008 we had $120 million drawn on our revolving credit
facility. There were no amounts drawn under this facility at December 31, 2006.
We believe our cash flow from operating activities together with our credit
facilities will provide us with sufficient liquidity and capital resources in
fiscal 2008 to fund our anticipated working capital and capital expenditure
requirements. Furthermore, we continue to have significant unused debt financing
capacity and financing flexibility to invest in capital expenditures for further
capacity expansion in excess of our current plans, as well as to pursue other
potential acquisition opportunities. </p>
<p ALIGN="JUSTIFY">In order to be able to support our opportunities for
continuing sales growth, we are continuing to invest in capacity expansion in
Central America. For fiscal 2008, we are projecting capital expenditures of
approximately $140 million. The projected capital investments for fiscal 2008
primarily include the projected expenditures to complete the ramp-up of the
activewear and sock facilities in Honduras, the energy and chemical cost
reduction projects, which we announced in May 2007, investments in our
information technology systems and the construction of a second sock facility to
be completed over twenty-four months. </p>
<p ALIGN="JUSTIFY">In order to maximize flexibility to finance our ongoing
growth and expansion and to be able to take advantage of additional new capital
investment and acquisition opportunities, we do not currently pay a dividend.
Periodically, the merits of introducing a dividend are re-evaluated by our Board
of Directors. </p>
<b>
<p align="justify">Off-Balance Sheet Arrangements <br>
</b>
We have no commitments that are not reflected in our balance
sheets except for operating leases and other purchase obligations, which are
included in the table of contractual obligations below. As disclosed in Note 6
to our interim consolidated financial statements, we have granted corporate
guarantees, irrevocable standby letters of credit and surety bonds to third
parties to indemnify them in the event the Company and some of its subsidiaries
do not perform their contractual obligations. As at December 30, 2007, the
maximum potential liability under these guarantees was $12.1 million, of which
$5.8 million was for surety bonds and $6.3 million was for corporate guarantees
and standby letters of credit. </p>
<sup>
<p align="justify">__________________________<br>
</sup></font><sup><font FACE="Times New Roman" style="font-size: 9pt">(1)</font></sup><font FACE="Times New Roman" style="font-size: 9pt">
Cash flows from operating activities, including net changes in non-cash working
capital balances, less cash from investing activities excluding business
acquisitions. See page 19. </p>
</font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.10 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Arial Narrow"><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
    </font>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2"><b>
<p>Contractual Obligations <br>
</b>
In the normal course of business, we enter into contractual
obligations that will require us to disburse cash over future periods. The
following table sets forth our contractual obligations for the following items
as at December 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Payments due by period</font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>Less
    than</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>1 to
    3</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>4 to
    5</b></font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2"><b>After</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Total</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>1 year</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>years</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>years</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">130.8</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.0</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">121.6</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Operating leases</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">48.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">5.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">13.6</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">10.0</font></td>
    <td WIDTH="12%" align="right"><font FACE="Times New Roman" SIZE="2">19.4</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Purchase obligations</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">110.7</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">110.5</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0.2</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Other obligations</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>Total Contractual Obligations</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>375.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>205.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>19.0</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>131.6</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>19.4</b></font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p>We expect that cash flows from operations, together with our cash balances
and unutilized bank facilities, will be sufficient to meet foreseeable cash
needs for fiscal 2008. </p>
<b>
<p>Outstanding Share Data <br>
</b>
Our common shares are listed on the New York Stock Exchange and the Toronto
Stock Exchange (GIL). </p>
<p ALIGN="JUSTIFY">As at January 30, 2008, there were 120,457,217 common shares
issued and outstanding along with 947,835 stock options and 922,000 dilutive
restricted share units (Treasury RSUs) outstanding. Each stock option entitles
the holder to purchase one common share at the end of the vesting period at a
pre-determined option price. Each Treasury RSU entitles the holder to receive
one common share from treasury at the end of the vesting period, without any
monetary consideration being paid to the Company. However, the vesting of 50% of
the restricted share grant is dependent upon the financial performance of the
Company relative to a benchmark group of Canadian publicly-listed companies. </p>
<b>
<p align="justify">Stock Split <br>
</b>
On May 2, 2007, our Board of Directors approved a two-for-one
stock split effected in the form of a stock dividend. The split was applicable
to all shareholders of record on May 18, 2007. The Company's shares commenced
trading on a post-split basis on May 16, 2007 on the Toronto Stock Exchange, and
on May 28, 2007 on the New York Stock Exchange, in accordance with the
respective requirements of these exchanges. All share and per share data in this
interim MD&amp;A reflect the effect of the stock split on a retroactive basis.
</font><font FACE="Times New Roman PSMT"> </p>
</font><font FACE="Times New Roman" SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
  <font color="#007CBC"><b>Financial Risk Management </b></font>
</div>
<p ALIGN="JUSTIFY">This section of this MD&amp;A provides disclosures relating to
the nature and extent of the Company's exposure to risks arising from financial
instruments, including credit risk, liquidity risk, foreign currency risk and
interest rate risk, and how the Company manages those risks. The disclosures
under this heading &quot;Financial Risk Management&quot;, in conjunction with the
information in Note 10 to the interim consolidated financial statements
(&quot;Financial Instruments&quot;), are designed to meet the requirements of the Canadian
Institute of Chartered Accountants Handbook Section 3862, &quot;Financial Instruments
Disclosures&quot;, which apply to interim and annual financial statements related to
fiscal years beginning on or after October 1, 2007 and are therefore
incorporated, and are an integral part of, the unaudited interim consolidated
financial statements. </p>
<b>
<p align="justify">Credit risk <br>
</b>
Credit risk is the risk of an unexpected loss if a customer
or counterparty to a financial instrument fails to meet its contractual
obligations, and arises primarily from the Company's trade receivables. The
Company may also have credit risk relating to cash and cash equivalents and
forward foreign exchange contracts, which it manages by dealing only with
highly-rated North American and European financial institutions. The
<font FACE="Arial MT" SIZE="2">carrying amount of financial assets, as disclosed
in Note 10(a) to the interim consolidated financial statements, represents the
Company's maximum credit exposure. </p>
</font></font><font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.11 </p>
</font>

<hr color="#000000" size="5"><p Style='page-break-before:always'><font FACE="Arial MT" SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p ALIGN="JUSTIFY">The Company's credit risk for trade receivables is
concentrated, as the majority of its sales are to a relatively small group of
wholesale distributors and mass-market retailers. As at December 30, 2007, the
Company's twenty largest trade debtors accounted for 84.4% of trade accounts
receivable, of which one wholesale customer accounted for 13.6% and one retailer
accounted for 17.1%. Of the Company's top twenty trade debtors, thirteen are
wholesale distributors and sixteen are located in the United States. The
remaining trade receivable balances are dispersed among a larger number of
debtors across many geographic areas. </p>
<p ALIGN="JUSTIFY">Most sales are invoiced with payment terms of between 30 to
60 days. In accordance with industry practice, sales of certain seasonal
products to wholesale distributors are invoiced with extended payment terms,
generally not exceeding six months. </p>
<p ALIGN="JUSTIFY">The Company's customers have generally been transacting with
the Company or its acquired subsidiaries for over 5 years, and losses have been
insignificant during that period. Most of our wholesale distributor customers
are privately-held owner-managed enterprises, and many distributors are
highly-leveraged with significant reliance on trade credit terms provided by a
few major vendors, including the Company, and third-party debt financing,
including bank debt secured with accounts receivable and inventory pledged as
collateral. The profile and credit quality of the Company's retail customers
varies from customer to customer. </p>
<p ALIGN="JUSTIFY">The Company's extension of credit to customers involves
considerable judgment. The Company has established various internal controls
designed to mitigate credit risk, including a dedicated credit function which
recommends customer credit limits and payment terms that are reviewed and
approved on a quarterly basis by senior management at the Company's
international sales office in Barbados. Where available, the Company's credit
department periodically reviews external ratings and customer financial
statements, and in some cases obtains bank and other references. New customers
are subject to a specific vetting and pre-approval process. The Company has also
established procedures to suspend the release of goods when customers have
fully-utilized approved credit limits or have not been respecting established
payment terms. From time to time, the Company will temporarily transact with
customers on a prepayment basis where circumstances warrant. While the Company's
credit controls and processes have been effective in mitigating credit risk,
these controls cannot eliminate credit risk and there can be no assurance that
these controls will continue to be effective, or that the Company's low credit
loss experience will continue. In the event of a future credit loss relating to
any one of our top ten customers, the Company could be required to record a
material charge to earnings. </p>
<p ALIGN="JUSTIFY">Customers do not provide collateral in exchange for credit,
except in unusual circumstances. Receivables from selected customers are
partially covered by credit insurance, with amounts usually limited to 20% of
the value of the Company's exposure. The information available through the
insurance company is also considered in the decision process to determine the
credit limits assigned to customers. </p>
<p ALIGN="JUSTIFY">The Company writes off trade receivable accounts to expected
realizable value as soon as the account is determined not to be fully
collectable, with such write-offs charged to earnings unless the loss has been
provided for in prior periods, in which case the write-off is applied to reduce
the allowance for doubtful accounts. The Company updates its estimate of the
allowance for doubtful accounts, based on a customer-by-customer evaluation of
the collectibility of trade receivable balances at each balance sheet reporting
date, taking into account amounts which are past due, and any available
information indicating that a customer could be experiencing liquidity or going
concern problems. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.12 </p>
</font><hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p>The Company's exposure to credit risk for trade receivables by geographic
area and type of customer as at December 30, 2007 was as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right"><font SIZE="2" face="Times New Roman"><b>
    December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">United States</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">116.1</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2" face="Times New Roman">Europe</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2" face="Times New Roman">7.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">Canada</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">10.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">Other regions</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">2.1</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-bottom-style: none; border-bottom-width: medium">
    <font SIZE="2" face="Times New Roman"><b>December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: none; border-top-width: medium; border-bottom-style:solid; border-bottom-width:1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-top-style: none; border-top-width: medium; border-bottom-style:solid; border-bottom-width:1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" bgcolor="#E6E6E6" style="border-top-style: solid; border-top-width: 1"><font SIZE="2" face="Times New Roman">Distributors and
    screenprinters</font></td>
    <td WIDTH="50%" align="right" bgcolor="#E6E6E6" style="border-top-style: solid; border-top-width: 1"><font SIZE="2" face="Times New Roman">75.2</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">Mass-market retailers</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman">61.0</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The aging of trade receivable balances as at December 30, 2007 was as
follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="510">&nbsp;</td>
    <td WIDTH="511" align="right"><font SIZE="2" face="Times New Roman"><b>
    December 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><i>(in $ millions)</i></font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" face="Times New Roman"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Not past due</font></td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">112.8</font></td>
  </tr>
  <tr>
    <td WIDTH="510"><font SIZE="2" face="Times New Roman">Past due 0-30 days</font></td>
    <td WIDTH="511" align="right">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">18.1</font></td>
  </tr>
  <tr>
    <td WIDTH="510" bgcolor="#E6E6E6"><font SIZE="2" face="Times New Roman">Past due 31-120 days</font></td>
    <td WIDTH="511" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">7.3</font></td>
  </tr>
  <tr>
    <td WIDTH="510"><font SIZE="2" face="Times New Roman">Past due 121-180 days</font></td>
    <td WIDTH="511" align="right">
    <p style="margin-right: 4"><font SIZE="2" face="Times New Roman">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Past due over 180 days</font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">-</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2" face="Times New Roman">Trade receivables</font></td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">138.5</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">Less allowance for doubtful accounts</font></td>
    <td WIDTH="511" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2" face="Times New Roman">(2.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="510" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">&nbsp;</td>
    <td WIDTH="511" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <p style="margin-right: 4">
    <font SIZE="2" face="Times New Roman">136.2</font></td>
  </tr>
</table>
<font SIZE="2"><font FACE="Arial MT" SIZE="2">
<p>The movement in the allowance for doubtful accounts in respect of trade
receivables was as follows: </p>
</font><b>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Balance at as September 30, 2007</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">2.0</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Bad debt expense</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Increase due to acquisition</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">Balance at as December 30, 2007</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">2.3</font></td>
  </tr>
</table>
<p align="justify">Liquidity Risk <br>
</b>
Liquidity risk is the risk that the Company will not be able
to meet its financial obligations as they fall due. The Company manages
liquidity risk through the management of its capital structure and financial
leverage, as outlined in Note 11 to the interim unaudited consolidated financial
statements (&quot;Capital Disclosures&quot;). It also manages liquidity risk by
continuously monitoring actual and projected cash flows, taking into account the
seasonality of the Company's sales and receipts and matching the maturity
profile of financial assets and liabilities. The Board of Directors reviews and
approves the Company's operating and capital budgets, as well as any material
transactions out of the ordinary course of business, including proposals on
mergers, acquisitions or other major investments or divestitures. In recent
years, the Company has financed its capacity expansion and sales growth mainly
through internally-generated funds, with a revolving credit facility being used
periodically to finance seasonal peak working capital requirements and
acquisitions. </p>
<p align="justify">The Company has a committed revolving credit facility for a maximum of $400
million which expires on June 28, 2012 and which is subject to a one-year
extension on an annual basis. This facility is unsecured and
<font FACE="Arial MT" SIZE="2">amounts drawn bear interest at LIBOR rates plus a
margin. As at December 30, 2007, $120 million was drawn under this facility
bearing an effective interest rate of 5.8%, primarily to finance the Company's
acquisition of Prewett that occurred on October 15, 2007 as described in this
MD&amp;A and in note 4 to the interim consolidated financial statements. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.13 </p>
</font>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'></font><font FACE="Arial MT" SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
<p>The following are the contractual maturities of financial liabilities,
excluding derivative financial instruments and future interest payments but
including interest accrued to December 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111" height="93">
  <tr>
    <td WIDTH="50%" height="14"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>Carrying</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>0 to 12</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>1 to 2</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>2 to 5</b></font></td>
    <td WIDTH="10%" height="14" align="right"><font SIZE="2"><b>More than 5</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="19" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>months</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="10%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Long-term credit facility</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">120.0</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">120.0</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15"><font SIZE="2">Other long-term debt</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">10.8</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">1.6</font></td>
    <td WIDTH="10%" height="15" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">118.9</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">118.9</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" height="15" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Total</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">249.7</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">123.5</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">4.6</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121.6</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's only derivative financial liabilities as at
December 30, 2007 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
listed on page 15. </p>
<b>
<p align="justify">Foreign Currency Risk <br>
</b>
The majority of the Company's cash flows and financial assets
and liabilities are denominated in U.S. dollars, which is the Company's
functional and reporting currency. Foreign currency risk is limited to the
portion of the Company's business transactions denominated in currencies other
than U.S. dollars, primarily for sales and distribution expenses for customers
outside of the United States and head office expenses in Canada. For the
Company's foreign currency transactions, fluctuations in the respective exchange
rates relative to the U.S. dollar will create volatility in the Company's cash
flows and the reported amounts for sales and selling, general and administrative
expenses in its consolidated statement of earnings, both on a period-to-period
basis and compared with operating budgets and forecasts. Additional earnings
variability arises from the translation of monetary assets and liabilities
denominated in currencies other than U.S. dollars at the rates of exchange at
each balance sheet date, the impact of which is reported as a foreign exchange
gain and loss in the statement of earnings. </p>
<p ALIGN="JUSTIFY">The Company's objective in managing its foreign currency risk
is to minimize its net exposures to foreign currency cash flows, by transacting
with third parties in U.S. dollars to the maximum extent possible and practical,
and holding cash and cash equivalents and incurring borrowings in U.S. dollars.
The Company monitors and forecasts the values of net foreign currency cash flow
and balance sheet exposures, and from time-to-time will authorize the use of
derivative financial instruments such as forward foreign exchange contracts to
economically hedge a portion of foreign currency cash flows, with maturities of
up to two years. The Company does not use forward foreign exchange contracts for
speculative purposes. </p>
<p ALIGN="JUSTIFY">The following tables provide an indication of the Company's
significant foreign currency exposures during the interim period ended December
30, 2007, including the period end balances of financial and monetary assets and
liabilities denominated in foreign currencies, as well as the amount of sales
and operating expenses during the interim period that were denominated in
foreign currencies, but before considering the effect of forward foreign
exchange contracts. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.14 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="41%" COLSPAN="2" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="10%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="41%" COLSPAN="2" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p align="right">December 30, 2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Cash and cash
    equivalents</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.0</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0.9</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font FACE="Times New Roman" SIZE="2">Accounts receivable</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">14.1</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">2.6</font></td>
    <td WIDTH="10%" align="center"><font FACE="Times New Roman" SIZE="2">3.6</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Accounts payable and
    accrued liabilities</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(18.7)</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(4.5)</font></td>
    <td WIDTH="10%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Future income taxes and income taxes
    payable</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(21.1)</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(1.0)</font></td>
    <td WIDTH="10%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0.7</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Balance sheet exposure excluding
    financial derivatives</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(25.7)</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="10%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="61%" COLSPAN="3" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="61%" COLSPAN="3" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>For the three months ended</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="48%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>December 30, 2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">9.9</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">4.8</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">4.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Operating expenses</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(12.4)</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(0.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Net exposure</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(2.5)</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">2.9</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">In addition to the foreign currency exposures noted above,
the Company also incurs a portion of its manufacturing costs in foreign
currencies, primarily payroll costs paid in Honduran Lempiras. However, the
Company does not currently view its exposure to the Honduran Lempira as a
significant foreign exchange risk, since the Lempira to U.S. dollar exchange
rate has not fluctuated in recent years. </p>
<p ALIGN="JUSTIFY">The following table summarizes the Company's derivative
financial instruments relating to commitments to buy and sell foreign currencies
through forward foreign exchange contracts as at December 30, 2007 and September
30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Notional</b></font></td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="45%" COLSPAN="2" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    foreign</b></font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Average</b></font></td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="31%" align="center" colspan="2" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p align="center">Carrying and Fair Value</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    currency</b></font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    exchange</b></font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2"><b>
    Notional US</b></font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>December 30, 2007</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>rate</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.3</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.4469</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">18.2</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0.9950</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">18.1</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">6-12
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">25.5</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0.9980</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">25.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.5</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">5.6</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.3647</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">7.7</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(0.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">6-12
    months</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">8.5</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">1.3964</font></td>
    <td WIDTH="11%" align="right" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">11.8</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" align="center" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">(0.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="10%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="right">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
    <td WIDTH="11%" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font FACE="Times New Roman" SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">0-6
    months</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">5.1</font></td>
    <td WIDTH="10%" align="right"><font FACE="Times New Roman" SIZE="2">1.9996</font></td>
    <td WIDTH="11%" align="right"><font FACE="Times New Roman" SIZE="2">10.2</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">0.1</font></td>
    <td WIDTH="11%" align="center"><font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">5.2</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">1.9952</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">10.3</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0.1</font></td>
    <td WIDTH="11%" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="28%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">85.5</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.2</font></td>
    <td WIDTH="11%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.2)</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111" height="264">
  <tr>
    <td WIDTH="40%" height="19"><font FACE="Times New Roman" SIZE="2"><i>(in $
    millions)</i></font></td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19">&nbsp;</td>
    <td WIDTH="11%" height="19">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="18"></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="10%" height="18" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Notional</b></font></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="10%" height="18" align="right"></td>
    <td WIDTH="19%" COLSPAN="2" height="18" align="center"></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Average</b></font></td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="19%" colspan="2" height="19" align="center">
    <div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
      <font FACE="Times New Roman" SIZE="2"><b>Carrying and Fair Value</b></font></div>
    </td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>currency</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>September 30, 2007</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Maturity</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>amount</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>rate</b></font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>equivalent</b></font></td>
    <td WIDTH="10%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="11%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.4</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.3616</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6.0</font></td>
    <td WIDTH="10%" height="15" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0.3</font></td>
    <td WIDTH="11%" height="15" align="center" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15"><font FACE="Times New Roman" SIZE="2">Sell EUR/Buy
    USD</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">4.9</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">1.3626</font></td>
    <td WIDTH="10%" height="15" align="right">
    <font FACE="Times New Roman" SIZE="2">6.7</font></td>
    <td WIDTH="10%" height="15" align="center">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center">
    <font FACE="Times New Roman" SIZE="2">(0.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">9.1</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">1.3677</font></td>
    <td WIDTH="10%" height="19" align="right">
    <font FACE="Times New Roman" SIZE="2">12.4</font></td>
    <td WIDTH="10%" height="19" align="center">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="19" align="center">
    <font FACE="Times New Roman" SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center" bgcolor="#E6E6E6">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" bgcolor="#E6E6E6"><font FACE="Times New Roman" SIZE="2">Sell GBP/Buy
    USD</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">4.8</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9988</font></td>
    <td WIDTH="10%" height="15" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">9.6</font></td>
    <td WIDTH="10%" height="15" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6-12 months</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">6.0</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">1.9841</font></td>
    <td WIDTH="10%" height="19" align="right" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">11.9</font></td>
    <td WIDTH="10%" height="19" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="19" align="center" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right">&nbsp;</td>
    <td WIDTH="10%" height="19" align="center">&nbsp;</td>
    <td WIDTH="11%" height="19" align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" height="15" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Sell CAD/Buy USD</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">0-6 months</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">1.0055</font></td>
    <td WIDTH="10%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">3.8</font></td>
    <td WIDTH="10%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
    <td WIDTH="11%" height="15" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" height="19" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" height="19" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">50.4</font></td>
    <td WIDTH="10%" height="19" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">0.3</font></td>
    <td WIDTH="11%" height="19" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.1)</font></td>
  </tr>
</table>
<font SIZE="2">
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.15 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p>The following exchange rates applied during the reporting period for the
three months ended December 30, 2007: </p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">Quarter</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">
    Reporting</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">average
    rate</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">date
    rate</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" size="2"><b>Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" size="2"><b>Q1 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">CAD to USD</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.0158</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.0207</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font FACE="Times New Roman" size="2">EUR to USD</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">1.4441</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" size="2">1.4624</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">GBP to USD</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">2.0466</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" size="2">1.9956</font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Based on the Company's foreign currency exposures noted above
and the forward foreign exchange contracts in effect during the three months
ended December 30, 2007, varying the above foreign exchange rates to reflect a 5
percent strengthening of the U.S. dollar would have increased (decreased) net
earnings as follows, assuming that all other variables remained constant: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2"><i>(in US$ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Source of net earnings variability
    from changes in foreign exchange rates</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">CAD</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">EUR</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Financial instruments, including
    forward foreign exchange contracts</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(1.9)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.9</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2">Future income tax
    liability and income taxes payable</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Sales and operating expenses</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.1)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Increase (decrease) in net earnings</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">(0.7)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.9</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.3</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">An assumed 5 percent weakening of the U.S. dollar during the
three months ended December 30, 2007 would have had an equal but opposite effect
on the above currencies to the amounts shown above, on the basis that all other
variables remain constant. </p>
<b>
<p align="justify">Interest Rate Risk <br>
</b>
The Company's interest rate risk is primarily related to the
Company's revolving long-term credit facility, for which amounts drawn are
subject to LIBOR rates in effect at the time of borrowing, plus a margin.
Although LIBOR-based borrowings under the credit facility can be fixed for
periods of up to six months, the Company generally fixes rates for periods of
one to three months. The interest rates on amounts currently drawn on this
facility and on any future borrowings will vary and are unpredictable. </p>
<p align="justify">The Company has the ability to enter into derivative financial instruments
that would effectively fix its cost of current and future borrowings for an
extended period of time, but it has not done so in recent years. </p>
<p ALIGN="JUSTIFY">Based on the value of interest-bearing financial instruments
during the three months ended December 30, 2007, an assumed 0.5 percentage point
increase in interest rates during such period would have decreased net earnings
by $0.2 million, with an equal but opposite effect for an assumed 0.5 percentage
point decrease. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%" id="AutoNumber1">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" size="2" color="#0000FF">Outlook </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">A discussion of management's expectations as to the Company's
outlook for fiscal 2008 is contained in the Company's first quarter earnings
results press release dated January 30, 2008 under the section entitled
&quot;Outlook&quot;. The press release is available on the SEDAR website at
<font color="#0000FF">www.sedar.com</font>, on the EDGAR website at
<font color="#0000FF">www.sec.gov</font> and on the Company's website at
<font color="#0000FF">www.gildan.com</font>. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.16 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1; border-top-style:none; border-top-width:medium">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Critical Accounting
    Estimates</font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">Our significant accounting policies are described in Note 2
to our 2007 audited consolidated financial statements. The preparation of
financial statements in conformity with Canadian GAAP requires estimates and
assumptions that affect our results of operations and financial position. By
their nature, these judgments are subject to an inherent degree of uncertainty
and are based upon historical experience, trends in the industry and information
available from outside sources. On an ongoing basis, management reviews its
estimates and actual results could differ materially from those estimates. </p>
<p align="justify">Management believes that the accounting estimates related to the following
areas are most significant to assist in understanding and evaluating our
financial results: </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li></font><font FACE="Times New Roman" SIZE="2">Sales promotional programs;
  </font></li>
  <li><font FACE="Times New Roman" SIZE="2">Trade accounts receivable; </font>
  </li>
  <li><font FACE="Times New Roman" SIZE="2">Property, plant and equipment;
  </font></li>
  <li><font FACE="Times New Roman" SIZE="2">Cotton and yarn procurements; </font>
  </li>
  <li><font FACE="Times New Roman" SIZE="2">Income taxes; and </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li></font><font SIZE="2" face="Times New Roman">Business acquisitions,
  including goodwill and identifiable intangible assets. </li>
</ul>
<p align="justify">For a more detailed discussion of these estimates, readers should review the
&quot;Critical Accounting Estimates&quot; section of the 2007 Annual MD&amp;A. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Recent Accounting
    Pronouncements </font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">In June 2007, the Canadian Institute of Chartered Accountants
(CICA) issued Section 3031, Inventories, which replaces Section 3030 and
harmonizes the Canadian standards related to inventories with International
Financial Reporting Standards (IFRS). This Section provides changes to the
measurement and more extensive guidance on the determination of cost, including
allocation of overhead; narrows the permitted cost formulas; requires impairment
testing; and expands the disclosure requirements to increase transparency. This
Section applies to interim and annual financial statements for fiscal years
beginning on or after January 1, 2008. We have not yet determined what the
impact of adopting this standard will have on our consolidated financial
statements. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Adoption of New Accounting
    Standards </font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Effective the commencement of our 2008 fiscal year, we
adopted CICA Handbook Section 1535, Capital Disclosures, CICA Handbook Section
3862, Financial Instruments&#151;Disclosure and CICA Handbook Section 3863, Financial
Instruments &#150; Presentation. These new Handbook Sections apply to fiscal years
beginning on or after October 1, 2007. The Sections relate to disclosure and
presentation only and did not have an impact on our financial results. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Internal Control Over
    Financial Reporting </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Management's annual evaluation and report on the
effectiveness of internal control over financial reporting as of our most recent
fiscal year ended September 30, 2007 was included in the 2007 Annual MD&amp;A, and
was based on the framework set forth in Internal Control - Integrated Framework
issued by the <i>Committee of Sponsoring Organizations of the Treadway
Commission</i> (COSO). Based on its evaluation under this framework, management
concluded that our internal control over financial reporting was effective as of
September 30, 2007. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.17 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">There have been no material changes in internal control over
financial reporting since September 30, 2007. With respect to the Company's
recent acquisition of Prewett that occurred on October 15, 2007, we have not
completed our assessment of the adequacy of the design or of the operating
effectiveness of Prewett's internal control over financial reporting. We will be
including Prewett in our annual evaluation and report on the effectiveness of
internal control over financial reporting for our fiscal year ending October 5,
2008. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Reconciliation and Definition
    of Non-GAAP Measures </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">We use non-GAAP measures to assess our operating performance
and financial condition. The terms and definitions of the non-GAAP measures used
in this report and a reconciliation of each non-GAAP measure to the most
directly comparable GAAP measure are provided below. The non-GAAP measures are
presented on a consistent basis for all periods presented in this MD&amp;A. These
non-GAAP measures do not have any standardized meanings prescribed by Canadian
GAAP and are therefore unlikely to be comparable to similar measures presented
by other companies. Accordingly, they should not be considered in isolation. </p>
<b>
<p align="justify">Adjusted Net Earnings and Adjusted Diluted EPS <br>
</b>
To measure our performance from one period to the next,
without the variations caused by the impact of restructuring and other charges
as discussed on page 8, management uses adjusted net earnings and adjusted
diluted earnings per share, which are calculated as net earnings and diluted
earnings per share excluding these items. We exclude these items because they
affect the comparability of our financial results and could potentially distort
the analysis of trends in our business performance. Excluding these items does
not imply they are necessarily non-recurring. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amounts)</i></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Reported</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Reported</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">250.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">250.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">185.8</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">185.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">171.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">171.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">131.9</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">131.9</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">78.9</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">78.9</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">53.9</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">53.9</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Selling, general and</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 15">administrative expenses</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">32.6</b></font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">32.6</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">26.1</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">26.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>(0.8)</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(1.4)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">45.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">46.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">26.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">27.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
    <td WIDTH="10%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6E6E6"><font SIZE="2">Non-controlling interest in income (loss)</font></td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 15">of consolidated joint venture</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(0.1)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">29.6</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">30.4</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">16.7</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">18.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Income tax expense</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">27.5</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2"><b>
    <p style="margin-right: 4">28.3</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">15.6</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">17.0</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.01</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.13</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.01</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Diluted E.P.S.</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.01</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.23</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.13</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.01</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">0.14</font></td>
  </tr>
</table>
<i><font SIZE="2">
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup>Adjustment to remove restructuring and other charges. See page 8. </p>
</font></i><font SIZE="2"><b>
<p align="justify">EBITDA
</b>
<br>
EBITDA is calculated as earnings before interest, taxes,
depreciation and amortization, non-controlling interest, and excludes the impact
of restructuring and other charges, as discussed on page 8. We use EBITDA, among
other measures, to assess the operating performance of our business. We also
believe this measure is commonly used by investors and analysts to measure a
company's ability to service debt and to meet other payment obligations, or as a
common valuation measurement. We exclude depreciation and amortization expenses,
which are non-cash in nature and can vary significantly depending upon
accounting methods or non-operating factors such as historical cost. Excluding
these items does not imply they are necessarily non-recurring. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.18</p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" style="border-collapse: collapse" bordercolor="#111111" cellpadding="0">
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right">&nbsp;</td>
    <td WIDTH="15%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">27.5</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">15.6</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.4</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">12.8</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">8.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.0</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Income tax expense</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2"><b>
    <p style="margin-right: 4">2.1</b></font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6"><font SIZE="2">
    <p style="margin-right: 4">1.1</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Non-controlling interest in income (loss) of</font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">consolidated joint venture</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.3</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">EBITDA</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">46.3</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">27.8</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup> See page 8. </p>
</i><b>
<p align="justify">Free Cash Flow <br>
</b>
Free cash flow is defined as cash from operating activities
including net changes in non-cash working capital balances, less cash flow used
in investing activities excluding business acquisitions. We consider free cash
flow to be an important indicator of the financial strength and performance of
our business, because it shows how much cash is available after capital
expenditures to repay debt and to reinvest in our business. We believe this
measure is commonly used by investors and analysts when valuing a business and
its underlying assets. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">Cash flows from operating activities</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">103.4</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">39.5</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Cash flows from investing activities</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>(169.2)</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(30.9)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6E6E6"><font SIZE="2">Add back:</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">
    <p style="margin-left: 15">Acquisition of Prewett</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">126.8</b></font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to acquisition</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2"><b>
    <p style="margin-right: 4">10.0</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Free cash flow</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">71.0</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">8.6</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i><b>
<p>Total Indebtedness and Cash in Excess of Debt (Net Indebtedness) <br>
</b>
We consider total indebtedness and net indebtedness to be important
indicators of the financial leverage of the Company. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">Q1 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">Q4 2007</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">Q1 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Bank indebtedness</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(3.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font FACE="Times New Roman" SIZE="2">Current portion of
    long-term debt</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2"><b>(4.6)</b></font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(3.7)</font></td>
    <td WIDTH="15%" align="right"><font FACE="Times New Roman" SIZE="2">(21.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">Long-term debt</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>(126.2)</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(56.0)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(10.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>Total indebtedness</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>(130.8)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2">(59.7)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font FACE="Times New Roman" SIZE="2">(35.6)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6E6E6">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" bgcolor="#E6E6E6">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">Cash and cash equivalents</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2"><b>
    <p style="margin-right: 4">13.6</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">9.3</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">36.3</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>Cash in excess of debt (net
    indebtedness)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2"><b>(117.2)</b></font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">(50.4)</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6E6E6">
    <font FACE="Times New Roman" SIZE="2">
    <p style="margin-right: 4">0.7</font></td>
  </tr>
</table>
<font SIZE="2"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.19 </p>
</font>
</i>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1; border-top-style:none; border-top-width:medium">
    <font FACE="Times New Roman" SIZE="2" color="#0000FF">Risks and
    Uncertainties </font></td>
  </tr>
</table>
<font FACE="Times New Roman" SIZE="2">
<p ALIGN="JUSTIFY">The Company is subject to a variety of business risks. The
risks described below are risks that could materially affect our business,
financial condition and results of operations, but are not necessarily the only
ones facing the Company. Additional risks that are not currently known to us or
that we currently deem immaterial, could also materially and adversely affect
our business. </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li></font><font FACE="Times New Roman" SIZE="2">Our ability to implement our
  strategies and plans; </font></li>
  <li>
  <p align="justify"><font FACE="Times New Roman" SIZE="2">Our industry is competitive; </font>
  </li>
  <li>
  <p align="justify"><font FACE="Times New Roman" SIZE="2">Our industry is subject to pricing
  pressures; </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li></font>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our success depends on our
  ability to anticipate evolving consumer preferences and trends; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations are subject to
  environmental regulation; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We rely on a relatively small number
  of significant customers; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our customers do not commit to
  purchase minimum quantities; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are exposed to concentrations of
  credit risk; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are subject to international
  trade regulation (see Update to the &quot;Description of Risks and Uncertainties&quot;
  below); </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We currently pay income tax at a
  comparatively low effective rate, which could change in the future; </font>
  </li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">The price of the raw materials we
  buy is prone to significant fluctuations and volatility; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations are subject to
  political, social and economic risks; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our industry is subject to
  fluctuations in sales demand; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our business operations
  significantly rely on our information systems; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We are subject to foreign currency
  risk; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">Our operations could be affected by
  changes in our relationships with our employees or changes to domestic and
  foreign employment regulations; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">We may suffer negative publicity if
  we, or our third-party contractors, violate labour laws or engage in practices
  that are viewed as unethical; </font></li>
  <li>
  <p align="justify"><font SIZE="2" face="Times New Roman">and We depend on key management </li>
</ul>
<p ALIGN="JUSTIFY">For a more detailed discussion of these potential business
risks, readers should review the &quot;Risks and Uncertainties&quot; section of the 2007
Annual MD&amp;A and the Annual Information Form filed by Gildan with the Canadian
securities regulatory authorities and the Annual Report on Form 40-F filed with
the U.S. Securities and Exchange Commission. </p>
<b>
<p align="justify">Updates to the Description of Risks and Uncertainties
</b>
<u><br>
We are subject to international trade regulation <br>
</u>We noted in our 2007 Annual MD&amp;A that the United States was
considering a safeguard against socks imported from Honduras. On January 18,
2008, the Committee for the Implementation of Textile Agreements notified the
Honduran government of its intent to apply a textile safeguard measure on cotton
socks imported into the United States. The safeguard would take the form of a
tariff of up to a maximum rate of 13.5%. The safeguard can commence as early as
April 2008 but will not extend beyond December 31, 2008. The U.S. government
will now be entering into discussions with the Honduran government in order to
make its final determination on this matter. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font FACE="Arial MT" SIZE="2" color="#0000FF">Forward-Looking Statements
    </font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Certain statements included in this MD&amp;A may constitute
&quot;forward-looking statements&quot; within the meaning of the U.S. <i>Private
Securities Litigation Reform Act of 1995</i> and Canadian securities legislation
and regulations, and are subject to important risks, uncertainties and
assumptions. This forward-looking information includes amongst others,
information with respect to our objectives and the strategies to achieve these
objectives, as well as information with respect to our beliefs, plans,
expectations, anticipations, estimates and intentions. Forward-looking
statements generally can be identified by the use of conditional or
forward-looking terminology such as &quot;may&quot;, &quot;will&quot;, &quot;expect&quot;, &quot;intend&quot;,
&quot;estimate&quot;, &quot;anticipate&quot;, &quot;plan&quot;, &quot;foresee&quot;, &quot;believe&quot; or <font FACE="Arial MT" SIZE="2">
&quot;continue&quot; or the negatives of these terms or variations of
them or similar terminology. We refer you to the Company's filings with the
Canadian securities regulatory authorities and the U.S. Securities and Exchange
Commission, as well as the &quot;Risks and Uncertainties&quot; section of the 2007 Annual
MD&amp;A for a discussion of the various factors that may affect the Company's
future results. Material factors and assumptions that were applied in drawing a
conclusion or making a forecast or projection are also set out throughout this
document. </p>
</font>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.20 </p>
</font>
<hr color="#000000" size="5"><p Style='page-break-before:always'>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <font SIZE="1" face="Times New Roman">
    <td width="50%"><font size="2">
    <img border="0" src="gildan3.jpg" width="90" height="30"></font></td>
    </font><font FACE="Arial Narrow" SIZE="1">
    <td width="50%">
    <p align="right"><font FACE="Times New Roman" SIZE="2" color="#808080">
    MANAGEMENT'S DISCUSSION AND ANALYSIS</font></font><font FACE="Times New Roman" size="2" color="#808080">
    </font></td>
</font>
  </tr>
</table>
</font><font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The results or events predicted in such forward-looking
information may differ materially from actual results or events. Material
factors, which could cause actual results or events to differ materially from a
conclusion, forecast or projection in such forward-looking information, include,
but are not limited to: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li></font>
  <p align="justify"><font FACE="Arial MT" SIZE="2">general economic conditions such as
  commodity prices, currency exchange rates, interest rates and other factors
  over which we have no control; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the impact of economic and business
  conditions, industry trends and other external and political factors in the
  countries in which we operate; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the intensity of competitive activity;
  </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in environmental, tax, trade and
  other laws and regulations; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to implement our strategies and
  plans; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to complete and successfully
  integrate acquisitions; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our reliance on a small number of
  significant customers; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in consumer preferences, customer
  demand for our products and our ability to maintain customer relationships and
  grow our business; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our customers do not commit to minimum
  quantity purchases; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">the seasonality of our business; </font>
  </li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">our ability to attract and retain key
  personnel; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">high reliance on computerized information
  systems; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">changes in accounting policies and
  estimates; </font></li>
  <li>
  <p align="justify"><font FACE="Arial MT" SIZE="2">and disruption to manufacturing and
  distribution activities due to labour disruptions, bad weather, natural
  disasters and other unforeseen adverse events. </li>
</ul>
<p ALIGN="JUSTIFY">This may cause the Company's actual performance and financial
results in future periods to differ materially from any estimates or projections
of future performance or results expressed or implied by such forward-looking
statements. Forward-looking statements do not take into account the effect that
transactions or nonrecurring or other special items announced or occurring after
the statements are made have on the Company's business. For example, they do not
include the effect of business dispositions, acquisitions, other business
transactions, asset writedowns or other charges announced or occurring after
forward-looking statements are made. The financial impact of such transactions
and non-recurring and other special items can be complex and necessarily depends
on the facts particular to each of them. </p>
<p ALIGN="JUSTIFY">We believe that the expectations represented by our
forward-looking statements are reasonable, yet there can be no assurance that
such expectations will prove to be correct. Furthermore, unless otherwise
stated, 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 unless required by
applicable legislation or regulation. The forward-looking statements contained
in this report are expressly qualified by this cautionary statement. </p>
</font><font SIZE="2">
<p>February 7, 2008 </p>
<font FACE="Times New Roman" SIZE="2" color="#808080">
<p align="right">GILDAN QUARTERLY REPORT &#150; Q1 2008 P.21 </p>
</font></font>

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