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<SEC-DOCUMENT>0001204459-08-001662.txt : 20080813
<SEC-HEADER>0001204459-08-001662.hdr.sgml : 20080813
<ACCEPTANCE-DATETIME>20080813165020
ACCESSION NUMBER:		0001204459-08-001662
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20080706
FILED AS OF DATE:		20080813
DATE AS OF CHANGE:		20080813

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:			0930

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-14830
		FILM NUMBER:		081013842

	BUSINESS ADDRESS:	
		STREET 1:		600 BOULEVARD DE MAISONNEUVE OUEST
		STREET 2:		33RD FLOOR
		CITY:			MONTREAL
		STATE:			A8
		ZIP:			H3A 3J2
		BUSINESS PHONE:		5147352023

	MAIL ADDRESS:	
		STREET 1:		600 BOULEVARD DE MAISONNEUVE OUEST
		STREET 2:		33RD FLOOR
		CITY:			MONTREAL
		STATE:			A8
		ZIP:			H3A 3J2

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GILDAN ACTIVEWEAR INC
		DATE OF NAME CHANGE:	19980515
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>gildanf6k081308.htm
<DESCRIPTION>FORM 6-K
<TEXT>
<html>

<head>

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

<body>

<font face="Times New Roman" size="5"><b>
<div style="border-top-style: solid; border-top-width: 1; padding-top: 1">
  <hr color="#000000" size="5">
</div>
<p align="center">UNITED STATES<br>
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:
      August 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="6"><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 style="font-size: 10pt" vAlign="top" align="left" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" align="left" colSpan="2"><b>GILDAN ACTIVEWEAR
    INC.</b></td>
  </tr>
  <tr>
    <td style="font-size: 10pt" align="left" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" vAlign="top" width="1%">&nbsp;</td>
    <td style="font-size: 10pt; border-bottom: medium none #000000" align="left" width="49%">
    &nbsp;</td>
  </tr>
  <tr>
    <td style="font-size: 10pt" align="left" width="50%">Date: August 13, 2008</td>
    <td style="font-size: 10pt" vAlign="top" width="1%">By:&nbsp;&nbsp;</td>
    <td style="font-size: 10pt; border-top: medium none; border-bottom: 1px solid #000000" align="left" width="49%">
    /s/ Lindsay Matthews &nbsp;</td>
  </tr>
  <tr>
    <td style="font-size: 10pt" align="left" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" width="1%">&nbsp;</td>
    <td style="font-size: 10pt" vAlign="top" width="49%">
    <p style="margin-top: 0px; margin-bottom: 0px">Name:&nbsp;&nbsp;</p>
    <p style="margin-left: 26pt; margin-top: -11pt; margin-bottom: 0px">
    <font face="Times New Roman" size="2">Lindsay Matthews&nbsp;</font></td>
  </tr>
  <tr>
    <td style="font-size: 10pt" align="left" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" width="1%">&nbsp;</td>
    <td style="font-size: 10pt" vAlign="top" width="49%">
    <p style="margin-top: 0px; margin-bottom: 0px">Title:&nbsp;&nbsp;</p>
    <p style="margin-left: 26pt; margin-top: -11pt; margin-bottom: 0px">
    <font face="Times New Roman" size="2">Director, Legal Services and<br>
    Corporate Secretary&nbsp;</font></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="gilexh991.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="gilexh991.htm" style="text-decoration: none">Q3 2008 - Quarterly Report to Shareholders</a></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="center" height="15">
    <a href="gilexh992.htm" style="text-decoration: none">99.2</a></td>
    <td vAlign="center" height="15"></td>
    <td vAlign="center" height="15">
    <p dir="ltr">
    <a href="gilexh992.htm" style="text-decoration: none">Q3 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>gilexh991.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
<html>

<head>
<title>Gildan Activewear Inc.: Exhibit 99.1 - 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="568" height="726"></p>
<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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY"><font color="#1060B3">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 and nine months ended July 6, 2008,
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 and nine months
ended July 6, 2008 and the related notes, and with our MD&amp;A (2007 Annual MD&amp;A)
and annual consolidated financial statements for the year ended September 30,
2007, which is part of the fiscal 2007 Annual Report. This MD&amp;A is dated August
12, 2008. All amounts in this report are in U.S. dollars, unless otherwise
noted. </font></p>
<p ALIGN="JUSTIFY"><font color="#1060B3">All financial information contained in
this interim MD&amp;A and in the unaudited 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="#1060B3">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><font color="#1060B3">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 23. </font></p>
<p><font color="#1060B3">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>
<p><font color="#1060B3">The Company's revenues and income are subject to
seasonal variations. Consequently, the results of operations for the third
quarter are traditionally not indicative of the results to be expected for the
full year. </font></p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><font color="#1060B3">OUR BUSINESS </font></font></td>
  </tr>
</table>
<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 $126.8 million, including transaction costs of
$1.5 million on closing, and also placed $10.0 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>Our Products </p>
</b>
<p ALIGN="JUSTIFY">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 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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.2</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Our Manufacturing and Distribution Facilities </p>
</b>
<p><u>Textile and Sock Manufacturing </u></p>
<p ALIGN="JUSTIFY">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 T-shirts, fleece, sport
shirts, underwear and socks. 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. During 2007,
we commenced production at our new integrated sock manufacturing facility and at
our new integrated textile facility for the production of activewear, both in
Rio Nance, Honduras. The expansion of these new facilities is nearing
completion. In August 2007, we announced plans for a second sock facility to
support our projected continuing growth in sales, which is expected to begin
production during the third quarter of fiscal 2009. On May 7, 2008, we announced
plans for a third activewear textile facility in Rio Nance, Honduras to support
our ongoing growth initiatives, where Gildan expects to leverage its existing
infrastructure and manufacturing resources. We currently expect the new facility
to be constructed during fiscal 2008 and 2009 and we expect to begin production
during the first quarter of fiscal 2010. </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. During fiscal 2006, the Dominican Republic facility ramped up production
of basic activewear product-lines and in fiscal 2007 reached a comparable scale
of production to our mature textile facility in Honduras. During the second
quarter of fiscal 2008, the introduction of more complex product-lines and
management turnover at this facility contributed to a shortfall in production
output and cost inefficiencies. During the third quarter of fiscal 2008, we
continued to implement our plan to improve the performance of the facility. </p>
<p ALIGN="JUSTIFY">In addition to our integrated sock manufacturing facility
located in our Central America manufacturing hub, we own and operate a U.S. sock
manufacturing facility in Hillsville, Virginia, and following the Prewett
acquisition, we own and operate sock manufacturing facilities in Fort Payne,
Alabama. </p>
<p><u>Yarn-Spinning </u></p>
<p ALIGN="JUSTIFY">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><u>Sewing </u></p>
<p align="justify">Our vertically-integrated sewing facilities are primarily
located in Central America. In the Caribbean Basin we utilize third-party
contractors, primarily in Haiti, to complement our vertically-integrated sewing
production. </p>
<p><u>Distribution </u></p>
<p ALIGN="JUSTIFY">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 market. </font>
<font FACE="Arial MT" SIZE="3"></p>
</font><font SIZE="2">
<p ALIGN="JUSTIFY">On May 7, 2008, the Company announced its intention to build
a new distribution centre in Honduras. In addition to supporting the Company's
continuing sales growth, the new distribution facility in Honduras will permit
direct shipments to both U.S. and international customers, where appropriate,
and is expected to provide a lower cost structure to handle labour-intensive
activities for mass-market retail customers.<b> </p>
</b></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.3</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Corporate Head Office and Employees </p>
</b>
<p align="justify">Our corporate head office is located in Montreal, Canada and
we currently employ more than 18,000 full-time employees worldwide. </p>
<b>
<p>Market Overview </p>
</b>
<p ALIGN="JUSTIFY">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 our growth for activewear products has been
driven by several industry market trends such as the following: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"></font><font SIZE="2">continued use
  of activewear for event merchandising (such as concerts, festivals, etc.);
  </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">continued evolution
  of the entertainment/sports licensing and merchandising businesses; </font>
  </li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the growing use of
  activewear for uniform applications; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the growing use of
  activewear for corporate promotions; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">continued increase
  in use of activewear products for travel and tourism; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">an increased
  emphasis on physical fitness; and </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.4</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">Strategy and Objectives </font></td>
  </tr>
</table>
<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="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font 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">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">
  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>Our growth strategy comprises the following five initiatives: </p>
<ol>
  <li>Continue to increase market share in the U.S. wholesale imprinted
  sportswear market in all product categories </li>
  <li>Leverage our successful business model to penetrate the mass-market retail
  channel and develop Gildan as a consumer brand </li>
  <li>Pursue international growth opportunities </li>
  <li>Continue to generate significant manufacturing cost reductions </li>
  <li>Re-invest free cash flow to pursue selective complementary acquisitions.
  </font><font FACE="Courier New PSMT" SIZE="2"></li>
</ol>
</font><font 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, as
subsequently updated in this MD&amp;A and in our first and second quarter 2008 MD&amp;A.
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3"><font SIZE="2">Operating Results </font>
    </font></td>
  </tr>
</table>
<b>
<p>Non-GAAP Financial Measures </p>
</b>
<p ALIGN="JUSTIFY">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 19 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.5</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Summary of Quarterly Results </p>
</b>
<p ALIGN="JUSTIFY">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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="30%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2008</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2007</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2006</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" style="border-bottom: 1px solid #000000"><font SIZE="2"><i>
    (in $ millions, except per share amounts) <sup>(1)</sup></i></font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 3">Q3</b></font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q2</font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q2</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q4</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Sales</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">380.8</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">293.8</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">250.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">254.9</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">291.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">232.1</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">185.8</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">235.2</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Net earnings</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">54.0</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">41.7</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">27.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">40.9</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">52.4</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">21.1</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">15.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">16.8</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Net earnings per share</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Basic EPS</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">0.45</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.35</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.23</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.44</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.18</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.13</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Diluted EPS</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">0.44</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.23</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.43</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.17</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.13</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Total assets</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">1,105.6</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">1 059.5</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">995.4</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">874.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">825.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">795.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">715.8</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">723.3</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Total long-term financial liabilities</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">104.7</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">142.2</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">126.2</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">56.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">39.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">52.7</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">10.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">12.0</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Average number of shares</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">&nbsp; outstanding (<i>in thousands)</i></font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Basic</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">120,492</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,464</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,428</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,401</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,359</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,320</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,278</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,209</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Diluted</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 3">121,622</b></font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,649</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,656</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,577</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,599</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,529</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,447</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,340</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><sup>
<p 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>
</font><font 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 </p>
</b>
<p ALIGN="JUSTIFY">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 $126.8 million, including
transaction costs of $1.5 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 $10.0 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 align="justify">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
independent 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.6</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Sales </p>
</b>
<p ALIGN="JUSTIFY">Sales in the third quarter amounted to $380.8 million, up
$89.2 million or 30.6% compared to $291.6 million in the third quarter of fiscal
2007. The increase in sales revenues was due to an increase of $43.8 million in
sock sales due to the acquisition of Prewett in the first quarter of fiscal
2008, an increase of approximately 6% in activewear unit selling prices and a
10.4% increase in unit sales volumes for activewear and underwear. The third
quarter of the 2008 fiscal year also comprised fourteen weeks instead of the
normal thirteen weeks for a fiscal quarter. The inclusion of an extra week is
required in every fifth or sixth fiscal year to maintain the alignment of the
Company's financial reporting cycle with the calendar year. Consistent with our
prior practice, the extra week is included in the third quarter. Growth in activewear unit sales volumes was significantly constrained by a lack of
inventory, as a result of lower than anticipated production from our Dominican
Republic textile manufacturing facility. We made good progress in improving the
performance of the Dominican Republic facility during the third quarter,
although inventory levels for activewear continue to be very low. For the nine
months ended July 6, 2008, sales totalled $925.0 million, up $215.4 million or
30.4% compared to the same period last year. The increase in sales was due to a
$115.6 million increase in sock sales due primarily to the acquisition of
Prewett, a 10.7% increase in unit sales volumes for activewear and underwear,
higher activewear selling prices and a higher valued product-mix for activewear.
</p>
<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, which tracks unit volume shipments from U.S. wholesale
distributors to U.S. screenprinters. The table below summarizes the S.T.A.R.S.
data for the quarter ended June 30, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" style="border-collapse: collapse" bordercolor="#111111" cellpadding="0">
  <tr>
    <td WIDTH="25%">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right"><font SIZE="2"><b>Three months
    ended June 30,</b></font></td>
    <td WIDTH="39%" COLSPAN="2" align="right"><font SIZE="2"><b>Three months
    ended June 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2008 vs 2007</b></font></td>
    <td WIDTH="24%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2008</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Unit Growth&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </b></font></td>
    <td WIDTH="39%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Market Share&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Industry</b></font></td>
    <td WIDTH="24%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">All Products</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">5.5%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(3.5)%</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>51.9%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">47.6%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">T-shirts</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">5.5 %</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(3.2)%</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>52.6%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">48.3%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">Fleece</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">23.4 %</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">0.3 %</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>51.7%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">42.2%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sport shirts</font></td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(10.6)%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(12.6)%</font></td>
    <td WIDTH="24%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>34.6%</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">34.0%</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The growth in activewear unit sales in the third fiscal
quarter was due to the additional week of shipments and continuing market share
penetration in all product categories in the U.S. wholesale distributor channel.
Although overall industry shipments from U.S. distributors to screenprinters
declined 3.5% during the three months ended June 30, 2008, according to the
S.T.A.R.S. report, distributor demand for Gildan products remained strong. The
Company continued to have a high open order position throughout the quarter,
which has continued into the fourth quarter. Overall inventories in the channel
continue to be in good balance in relation to expected industry demand. </p>
<p ALIGN="JUSTIFY">In the T-shirt category, sales volumes of Gildan T-shirts by
U.S. distributors to screenprinters grew by 5.5% for the quarter ended June 30,
2008, and our leading market share in this category increased to 52.6%. Unit
volume growth of Gildan fleece products from U.S. distributors to screenprinters
totalled 23.4% while growth in the industry was essentially flat. Our leading
market share in this category reached a record high of 51.7%. Our leading brand
position in sport shirts also increased slightly to 34.6%. However, industry
unit shipments were down 12.6% for the quarter, and Gildan sport shirt shipments
within the U.S. distributor channel declined by 10.6% due in part to lack of
product availability as a result of the production capacity constraints from our
Dominican Republic facility. </p>
<p align="justify">Unit shipments to Canada, Europe, Asia/Pacific and Mexico
reflected increases of 6.4% for the third quarter and 4.3% for the first nine
months of fiscal 2008 compared to the same periods in fiscal 2007. Growth in
<font SIZE="2">these markets was constrained due to a lack of product
availability and the delay in the new product introductions as a result of the
shortfall in production from the Dominican Republic facility. </p>
</font></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.7</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">During the third quarter, we began shipment of our first
retail underwear program. We are pleased with consumer demand for our retail
products during the third quarter, and with the improvement in our service
levels to mass retailers. Also, we have continued to implement our strategy to
rationalize our sock product-mix, in order to focus on basic higher-volume
products and programs which capitalize on Gildan's modern large-scale
manufacturing capacity. </p>
<b>
<p>Gross Profit </p>
</b>
<p ALIGN="JUSTIFY">Gross profit of $120.4 million for the third quarter and
$298.9 million for the first nine months of fiscal 2008 increased $26.0 million
and $71.9 million, respectively, compared to the same periods last year. Gross
margins in the third quarter of fiscal 2008 declined slightly to 31.6%, compared
to 32.4% in the third quarter of fiscal 2007. The positive gross margin impact
of higher activewear selling prices and favourable manufacturing efficiencies
arising from the consolidation of textile facilities in the fourth quarter of
fiscal 2007 was more than offset by higher cotton, energy, chemicals and
transportation costs, the impact of production inefficiencies in the Dominican
Republic textile facility, as inventories produced in the second fiscal quarter
were consumed in cost of sales, a lower proportion of high-valued sport shirt
sales, and the impact of the acquisition of Prewett. Socks manufactured by
Gildan in the U.S. have lower gross margins than activewear and sock products
manufactured in the Company's Honduran manufacturing facilities, and therefore
dilute overall gross margins. </p>
<p ALIGN="JUSTIFY">Gross margins for the first nine months of fiscal 2008 were
32.3% compared to gross margins of 32.0% in the same period of fiscal 2007.
Gross margins for the first nine months of fiscal 2008 were positively impacted
by higher activewear selling prices and lower promotional discounts,
manufacturing efficiencies arising from the consolidation of textile facilities
and a higher-valued product-mix. These positive factors were offset by higher
cotton, freight and energy costs, production inefficiencies in the Dominican
Republic facility, the impact of inventory write-downs during fiscal 2008 in
order to accelerate the liquidation of sock product-lines, which have been
discontinued, and the impact of the acquisition of the Prewett acquisition,
which generates lower margins than our activewear business. Additional costs
were also incurred in the second quarter of fiscal 2008 to service mass-market
retailers during the integration of our retail information systems. </p>
<b>
<p>Selling, General and Administrative Expenses </p>
</b>
<p ALIGN="JUSTIFY">Selling, general and administrative (SG&amp;A) expenses in the
third quarter of fiscal 2008 were $43.9 million, or 11.5% of sales, compared to
$28.4 million, or 9.7% of sales, in the third quarter of last year. For the
first nine months of fiscal 2008, SG&amp;A expenses were $113.1 million, or 12.2% of
sales, compared to $83.1 million or 11.7% of sales in the same period last year.
The increase in SG&amp;A expenses was due to the acquisition of Prewett, higher
distribution and transportation expenses, a provision of $2.6 million for
non-collection of accounts receivable from a U.S. retail customer, which filed
for bankruptcy protection during the third quarter, higher corporate
infrastructure costs, including the impact of the higher-valued Canadian dollar,
a charge for the disposal of surplus fixed assets, and professional fees for
special projects. </p>
<b>
<p>Restructuring and Other Charges </p>
</b>
<p ALIGN="JUSTIFY">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 Canadian
corporate office. The costs incurred in connection with these announcements have
been recorded as restructuring and other charges, and include severance and
other 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. Other costs relate primarily to exit costs
incurred in connection with the closures noted above, including carrying and
dismantling costs associated with assets held for sale. During the third quarter
of fiscal 2008, we recorded restructuring charges of $2.3 million consisting
primarily of a $1.7 million impairment loss on property, plant and equipment
resulting from a planned consolidation of our sewing operations in Haiti. For
the first nine months of fiscal 2008, restructuring charges totalled $3.9
million consisting primarily of the $1.7 million impairment loss and other exit
costs of $2.2 million relating to the closures announced in fiscal 2006 and
2007. Additional carrying costs relating to the closed facilities and any gains
or losses on the disposition of the assets held for sale, which we do not expect
to be material, will be accounted for as restructuring charges as incurred. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.8</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">During the third quarter and first nine months of fiscal
2007, we incurred restructuring and other charges of $4.6 million and $22.3
million, respectively, in connection with the closures announced in fiscal 2006
and 2007. The restructuring and other charges in the first nine months of fiscal
2007 included severance costs of $13.3million, an asset impairment loss of
$3.6million relating to the relocation of our corporate head office, accelerated
depreciation of $2.9 million and exit costs of $4.4 million. These costs were
partially offset by a gain of $1.9 million from the sale of some of the assets
related to the above-noted facilities. </p>
<b>
<p>Depreciation and Amortization Expense </p>
</b>
<p ALIGN="JUSTIFY">Depreciation and amortization expense of $15.3 million in the
third quarter and $43.2 million for the first nine months of fiscal 2008,
increased $5.1 million and $14.7 million, respectively, compared to the same
periods in 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 and the impact of the Prewett acquisition,
including the amortization of acquired intangible assets, as well as a charge to
write down surplus fixed assets. </p>
<b>
<p>Interest Expense </p>
</b>
<p ALIGN="JUSTIFY">Net interest expense for the third quarter amounted to $1.2
million, slightly down from $1.5 million for the same period last year, mainly
as a result of declining interest rates during the quarter, despite higher
average debt balances compared to the third quarter of fiscal 2007. For the
first nine months of fiscal 2008, net interest expense of $6.1 million was up
$2.6 million compared to the same period last year mainly due to the increased
utilization of our revolving long-term credit facility to fund the acquisition
of Prewett, effective October 15, 2007, partially offset by the impact of lower
interest rates. </p>
<b>
<p>Income Taxes </p>
</b>
<p ALIGN="JUSTIFY">Income tax expense for the third quarter and the first nine
months of fiscal 2008 was $3.4 million and $9.1 million, respectively, compared
to an income tax recovery of $3.3 million in the third quarter and $0.2 million
in the first nine months of fiscal 2007. During the third quarter of fiscal
2007, we recognized previously unrecorded tax benefits in the amount of $5.7
million relating to a prior taxation year. Excluding the impact of this income
tax recovery, as well as the impact of restructuring and other charges in both
the current year and prior year periods, the effective income tax rate in the
third quarter and the first nine months of fiscal 2008 was 5.8% and 6.7%,
respectively, compared to an effective income tax rate of 4.6% and 4.9% for the
same periods last year. The increase in the effective income tax rate was
primarily due to the higher tax rate attributable to our operations in the U.S.,
which are currently taxed at higher effective income tax rates. </p>
<b>
<p>Net Earnings </p>
</b>
<p ALIGN="JUSTIFY">Net earnings for the third quarter were $54.0 million, or
$0.44 per share, on a diluted basis (EPS) compared to net earnings of $52.4
million, or $0.43 per share, on a diluted basis for the third quarter of fiscal
2007. Net earnings included restructuring and other charges of $2.3 million, or
$0.02 per share in the third quarter of fiscal 2008 and $4.6 million, or $0.04
per share in the third quarter of fiscal 2007. Before reflecting the
restructuring charges in both fiscal years, adjusted net earnings and adjusted
diluted EPS for the third quarter of fiscal 2008 were $56.3 million, or $0.46,
essentially flat compared to adjusted net earnings of $57.0 million and adjusted
diluted EPS of $0.47 in the third quarter of fiscal 2007. Net earnings for the
third quarter last year included an income tax recovery of $5.7 million, or
$0.05 per share from a prior fiscal year. The slight decline in EPS in the third
quarter this year reflected higher activewear selling prices and unit sales
volumes and the inclusion of an additional week of shipments, which were more
than offset by higher cotton, energy and transportation costs, unfavourable
product-mix, higher SG&amp;A and depreciation expenses, the non-recurrence of a
prior year income tax recovery which positively impacted EPS by $0.05 in the
third quarter of last year, a provision for a doubtful receivable account, and
charges to write-off or dispose of surplus fixed assets. </p>
<p ALIGN="JUSTIFY">The Company's results for its third fiscal quarter were in
line with its most recent EPS guidance. More favourable than projected activewear selling prices, unit volumes and product-mix were offset by a
provision for a doubtful receivable account, and charges to write off or dispose
of surplus fixed assets. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.9</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">For the first nine months of fiscal 2008, net earnings
amounted to $123.2 million, or $1.01 per share on a diluted basis, compared to
net earnings of $89.2 million, or $0.73 per share, for the same period in fiscal
2007. Before the impact of restructuring and other charges, adjusted net
earnings in the first nine months of fiscal 2008 amounted to $127.1 million, or
$1.04 per share on a diluted basis, up respectively 14.0% and 13.0% compared to
adjusted net earnings of $111.5 million or $0.92 per share on a diluted basis
for the same period last year. The increase in adjusted net earnings and
adjusted diluted EPS in fiscal 2008 was primarily due to growth in unit sales
volumes for activewear and underwear, higher activewear selling prices,
favourable activewear product-mix and further manufacturing efficiencies for
activewear. These positive factors were partially offset by increases in cotton,
energy, chemicals and transportation costs, production inefficiencies in the
Dominican Republic facility, higher SG&amp;A, depreciation and interest expenses,
the nonrecurrence of the income tax recovery in the third quarter of fiscal 2007
and the impact of a higher effective income tax rate. Net earnings and diluted
EPS for the first nine months of fiscal 2008 were also negatively impacted by
additional costs to service mass-market retailers in the second quarter during
the integration of our retail information systems, a write-down of inventories
of discontinued sock product-lines in the second quarter, a provision for
non-collection of a receivable account from a U.S. retail customer in the third
quarter, and charges in the third quarter for the write-down or disposal of
surplus fixed assets. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">Financial Condition </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Accounts receivable increased to $254.5 million in the third
quarter of fiscal 2008 from $206.1 million at September 30, 2007 and increased
by $71.0 million compared to the third quarter of the prior year. The increase
in accounts receivable from the end of fiscal 2007 reflected an increase in
activewear sales and the inclusion of accounts receivable from the Prewett
acquisition, partially offset by a decline in days sales outstanding. Typically,
our days sales outstanding are higher in the second half of the year and highest
in the fourth quarter, as a result of seasonal programs for fleece and
long-sleeved T-shirts invoiced with extended payment terms in the spring and
summer months, in line with industry practice. The increase in accounts
receivable compared to the third quarter of fiscal 2007 was mainly due to the
increase in activewear sales in the third quarter over the prior year, the
inclusion of accounts receivable from the acquisition of Prewett and an increase
in days sales outstanding due to a higher proportion of fleece sales which
reflect extended payment terms as noted above. </p>
<p ALIGN="JUSTIFY">Inventories of $290.8 million were up $50.9 million, or 21.2%
from September 30, 2007 and up $59.3 million, or 25.6% compared to the third
quarter of fiscal 2007. The increase in inventories compared to both periods
reflected the inclusion of inventories from the Prewett acquisition. Excluding
the impact of the Prewett acquisition, inventories were essentially flat
compared to September 30, 2007. Increases in unit costs resulting from higher
costs of cotton, freight and energy were offset by lower inventory volume levels
due to the production capacity constraints resulting from the manufacturing
issues in the Dominican Republic facility. </p>
<p ALIGN="JUSTIFY">Property, plant and equipment, which are net of accumulated
depreciation and asset impairment losses, amounted to $426.8 million at the end
of the third quarter of fiscal 2008, up $49.2 million from September 30, 2007.
This increase was primarily due to the inclusion of $20.2 million of property,
plant and equipment from the acquisition of Prewett, net capital expenditures of
$79.8 million, mainly for the capacity expansion projects in Honduras, partially
offset by depreciation of $38.7 million, an impairment loss on property, plant
and equipment of $1.7 million primarily related to the planned consolidation of
our sewing operations in Haiti and a reclassification of property, plant and
equipment to assets held for sale of $6.9 million mainly related to the land and
building of our former corporate head office. </p>
<p ALIGN="JUSTIFY">Other assets at the end of the third quarter of fiscal 2008
amounted to $18.2 million, up from $11.4 million at September 30, 2007. The
increase reflected $10.0 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.10</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">Goodwill and identifiable intangible assets of $63.9 million
as at July 6, 2008 primarily related to the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Total assets were $1,105.6 million at July 6, 2008, compared
to $874.5 million at September 30, 2007 and $825.0 million at the end of the
third quarter of fiscal 2007. Working capital was $411.1 million at the end of
the third quarter of fiscal 2008 compared to $342.5 million at September 30,
2007 and $307.1 million at July 1, 2007. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify">Cash Flows and Liquidity and Capital Resources </font>
    </td>
  </tr>
</table>
<b>
<p align="justify">Cash Flows </p>
</b>
<p ALIGN="JUSTIFY">Cash flows from operating activities in the third quarter of
fiscal 2008 were $40.7 million, compared to $32.3 million for the previous year.
The increase in cash inflow was mainly due to higher cash operating earnings and
increases in accounts payable and accrued liabilities which reflected higher
balances primarily related to yarn purchases as a result of increases in cotton
costs and production volumes. This was partially offset by a higher seasonal
increase in accounts receivable due to a higher proportion of fleece sales,
which are invoiced with extended payment terms, and a lower increase in
inventories due to the production issues at the Dominican Republic facility. For
the first nine months of fiscal 2008, cash flows from operating activities were
$168.4 million compared to cash flows from operating activities of $72.1 million
in the same period last year mainly as a result of higher cash operating
earnings and a higher seasonal decrease in accounts receivable and a lower
seasonal increase in inventories. </p>
<p ALIGN="JUSTIFY">Cash flows used in investing activities were $19.2 million in
the third quarter of fiscal 2008 down from $29.2 million in the third quarter of
fiscal 2007 mainly as a result of lower capital expenditures in fiscal 2008. The
decrease in capital expenditures in the quarter primarily reflected lower
spending requirements in fiscal 2008 for our major textile and sock capacity
expansion projects in Honduras. For the first nine months of fiscal 2008, cash
flows used in investing activities amounted to $213.0 million compared to $103.7
million for the same period last year. This increase was mainly attributable to
the acquisition of Prewett, for a purchase price of $126.8 million, partially
offset by lower capital expenditures during the first nine months of fiscal
2008, mainly as a result of lower spending requirements for our Honduran
capacity expansion projects compared to last year. </p>
<p ALIGN="JUSTIFY">Free cash flow grew to $92.2 million for the first nine
months of fiscal 2008 compared to negative free cash flow of $31.6 million in
the same period last year, primarily attributable to higher cash flow from
operations and lower capital expenditures. </p>
<p ALIGN="JUSTIFY">Cash flows used in financing activities in the third quarter
of fiscal 2008 of $37.5 million mainly reflected higher reductions on our long
term credit facility used primarily to finance the acquisition of Prewett,
compared to the same period last year. Cash flows used in financing activities
in the third quarter last year of $31.1 million reflected reductions on our
long-term credit facility and the final $17.5 million repayment of the Company's
Senior Notes. For the first nine months ended fiscal 2008 cash flows from
financing activities were $48.5 million compared to $10.0 million for the first
nine months of fiscal 2007. The increase reflected a higher amount of funds
drawn under our revolving long-term credit facility in order to finance the
acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Cash and cash equivalents amounted to $13.2 million as at
July 6, 2008 compared to $7.5 million at the end of the third quarter last year
and $9.3 million at September 30, 2007. Total indebtedness at July 6, 2008
amounted to $108.4 million compared to $59.7 million at September 30, 2007 and
$42.9 million at July 1, 2007. The 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.11</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Liquidity and Capital Resources </p>
</b>
<p ALIGN="JUSTIFY">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 and business acquisitions. 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 $126.8 million on closing of the
Prewett acquisition and also placed $10.0 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 is subject to a
one-year extension on an annual basis, to $400 million. This facility, which
expires on June 28, 2013, is on an unsecured basis. As at the end of the third
quarter of fiscal 2008 we had $100 million drawn on our revolving credit
facility compared to $30.0 million drawn on our revolving credit facility at the
end of the third quarter of fiscal 2007. We believe our cash flow from operating
activities together with our credit facilities will provide us with sufficient
liquidity and capital resources to fund our anticipated working capital and
capital expenditure requirements for the foreseeable future. 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 now projecting capital expenditures of
approximately $115 million, compared to our previous projection of $130 million.
The reduction in the projected capital expenditures for fiscal 2008 is primarily
due to timing delays related to the land filling in Honduras to prepare sites
for capacity expansion projects as well as sewing capacity expansion. Capital
investments for fiscal 2008 primarily include the projected expenditures to
complete the ramp-up of the activewear and sock facilities in Honduras, a
chemical cost reduction project, which we announced in May 2007, investments in
our information technology systems and a second sock facility expected to be
completed in fiscal 2009. On May 7, 2008, we announced our intentions to
construct a third large-scale, vertically-integrated textile facility in
Honduras, where Gildan expects to leverage its existing infrastructure and
manufacturing management resources. Capital expenditures for fiscal 2009 are
projected to be $160 million and are expected to include expenditures for our
second sock facility and third activewear textile facility in Honduras, as well
as investments in sewing capacity expansion and information technology systems
to support our growth. </p>
<p ALIGN="JUSTIFY">In order to maintain or adjust its capital structure, the
Company, upon approval from its Board of Directors, may issue or repay long-term
debt, issue shares, repurchase shares, pay dividends or undertake other
activities as deemed appropriate under the specific circumstances. We do not
currently pay a dividend. However, the Company's Board of Directors periodically
evaluates the merits of introducing a dividend. </p>
<b>
<p>Off-Balance Sheet Arrangements </p>
</b>
<p ALIGN="JUSTIFY">We do not have any 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 unaudited 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 certain of its
subsidiaries do not perform their contractual obligations. As at July 6, 2008,
the maximum potential liability under these guarantees was $17.4 million, of
which $5.2 million was for surety bonds and $12.2 million was for corporate
guarantees and standby letters of credit. </p>
<b>
<p>Contractual Obligations </p>
</b>
<p ALIGN="JUSTIFY">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, excluding future
interest payments, for the following items as at July 6, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.12</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="36%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Payments due by period</font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>Less than</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>1 to 3</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>4 to 5</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>After</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" 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>Total</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>1 year</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">108.4</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">1.2</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">7.2</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Operating leases</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">48.4</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">1.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">22.0</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">9.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">15.2</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Purchase obligations</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">95.2</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">90.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">4.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other obligations</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">61.3</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">49.6</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">11.7</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font 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">
    <font SIZE="2"><b>313.3</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>143.0</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>45.8</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>109.3</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>15.2</b></font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">We expect that cash flows from operations, together with our
cash balances and unutilized bank facilities, will be sufficient to meet cash
needs for the foreseeable future. </p>
<b>
<p align="justify">Outstanding Share Data </p>
</b>
<p align="justify">Our common shares are listed on the New York Stock Exchange
and the Toronto Stock Exchange (GIL). </p>
<p align="justify">As at July 31, 2008, there were 120,525,039 common shares
issued and outstanding along with 884,071 stock options and 906,800 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">Recent Developments in Legal Proceedings </p>
</b>
<p align="justify">During the quarter, a number of proposed securities class
action lawsuits were filed against the Company alleging, among other things,
that the Company misrepresented its financial prospects in its financial
guidance concerning the 2008 fiscal year. See &quot;Update to the Description of
Risks and Uncertainties - Securities Class Actions&quot;. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Financial Risk Management </font></font>
    </td>
  </tr>
</table>
<p align="justify">This section of the 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 unaudited 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 into, and are an integral part of, the unaudited interim
consolidated financial statements. </p>
<b>
<p align="justify">Credit risk </p>
</b>
<p align="justify">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 carrying
amount of financial assets, as disclosed in Note 10(a) to the interim
consolidated financial statements, represents the Company's credit exposure at
the reporting date, including trade receivables. The Company's trade receivables
and credit exposure fluctuate throughout the year. The Company's average trade
receivables and credit exposure during an interim reporting period may be higher
than the balance at the end of that reporting period. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.13</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<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 July 6, 2008, the
Company's twenty largest trade debtors accounted for 79.3% of trade accounts
receivable, of which one wholesale customer accounted for 18.3% and one retailer
accounted for 8.4%. Of the Company's top twenty trade debtors, seventeen are
wholesale distributors, and seventeen 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 to wholesale distributors
of certain seasonal products, primarily in the second half of the fiscal year,
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 five years, and credit losses
have not been material 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 financial leverage of certain of our wholesale distributor
customers may limit or prevent their ability to obtain future financing, and
could affect their ability to comply with restrictive debt covenants and meet
other obligations. The profile and credit quality of the Company's retail
customers varies significantly. Adverse changes in a customer's financial
position could cause us to limit or discontinue business with that customer,
require us to assume more credit risk relating to that customer's future
purchases or result in uncollectible accounts receivable from that customer.
Such changes could have a material adverse effect on our business, results of
operations, financial condition and cash flows. </p>
<p align="justify">The Company's extension of credit to customers involves
considerable judgment and is based on an evaluation of each customer's financial
condition and payment history. 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. </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>
<p align="justify">The Company's exposure to credit risk for trade receivables
by geographic area and type of customer as at July 6, 2008 was as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.14</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></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%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">United States</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">206.2</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Europe</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">14.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Canada</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">13.4</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other regions</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">2.7</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">236.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Distributors and screenprinters</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">189.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Mass-market and regional retailers</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">47.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">236.9</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The aging of trade receivable balances as at July 6, 2008 was as follows: </p>
</font>
<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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Not past due</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">221.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Past due 0-30 days</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">12.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Past due 31-120 days</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">5.8</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="2">Past due 121-180 days</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1"><font SIZE="2">Trade receivables</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1"><font SIZE="2">
    <p style="margin-right: 4">240.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Less allowance for doubtful accounts</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" 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">236.9</font></td>
  </tr>
</table>
<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>
<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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Balance as at September 30, 2007</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">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">
    <p style="margin-right: 4">2.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Write-off of accounts receivable</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">(0.8)</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Increase due to acquisition</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Balance as at July 6, 2008</font></td>
    <td WIDTH="50%" 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">4.0</font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Liquidity Risk </p>
</b>
<p ALIGN="JUSTIFY">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 unaudited interim 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 business
acquisitions. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.15</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The Company has a committed revolving credit facility for a
maximum of $400 million which expires on June 28, 2013 and which is subject to a
one-year extension on an annual basis. This facility is unsecured and amounts
drawn bear interest at LIBOR rates or U.S. base rate plus a margin. As at July
6, 2008, $100 million was drawn under this facility, bearing an effective
interest rate of 3.5%, 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>
<p align="justify">The following are the contractual maturities of financial
liabilities, excluding derivative financial instruments and future interest
payments but including interest accrued to July 6, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="36%"><font size="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right"><font size="2"><b>Carrying</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>0 to 12</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>1 to 2</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>2 to 5</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>More than</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" 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>amount</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>months</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1">
    <font size="2">Long-term credit facility</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font size="2">Other long-term debt</font></td>
    <td WIDTH="12%" align="right"><font size="2">8.4</font></td>
    <td WIDTH="13%" align="right"><font size="2">3.8</font></td>
    <td WIDTH="13%" align="right"><font size="2">4.6</font></td>
    <td WIDTH="13%" align="right"><font size="2">-</font></td>
    <td WIDTH="13%" align="right"><font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">147.4</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">147.4</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>Total</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">
    <font size="2"><b>255.8</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>151.2</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>4.6</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>100.0</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>-</b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's only derivative financial liabilities as at
July 6, 2008 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
listed on page 17. </p>
<b>
<p>Foreign Currency Risk </p>
</b>
<p ALIGN="JUSTIFY">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 corporate 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 or 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 nine months ended July 6,
2008, 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. </font><font FACE="Times New Roman PS" SIZE="1"><b></p>
</b></font><font SIZE="2"></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.16</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></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 align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&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="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in US$ millions)</i></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>July 6, 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>CAD</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Cash and cash equivalents</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">2.1</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Accounts receivable</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">16.6</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">5.9</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">5.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Accounts payable and accrued liabilities</font></td>
    <td align="right"><font SIZE="2">(15.7)</font></td>
    <td align="right"><font SIZE="2">(2.9)</font></td>
    <td 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">
    <font SIZE="2">Future income taxes and income taxes payable</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(26.0)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(1.0)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Balance sheet exposure excluding financial derivatives</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(23.6)</font></td>
    <td 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">4.1</font></td>
    <td 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">7.5</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 align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>For the nine months ended</b></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"><i>(in US $ millions)</i></font></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">&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>July 6, 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" 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>CAD</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Sales</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">41.1</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">24.8</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">16.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Operating expenses</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(38.6)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(7.2)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(2.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net exposure</font></td>
    <td 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">2.5</font></td>
    <td 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">17.6</font></td>
    <td 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">14.8</font></td>
  </tr>
</table>
<font 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 significantly 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 July 6, 2008 and September 30,
2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="23%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right"><font SIZE="2"><b><u>Carrying and
    Fair Value</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>currency</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>July 6, 2008</b></font></td>
    <td WIDTH="15%" align="center" 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>amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>rate</b></font></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="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="center" 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">&nbsp;</td>
    <td WIDTH="12%" 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">&nbsp;</td>
    <td WIDTH="13%" 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">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">35.5</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0.9923</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">35.2</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">8.5</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3963</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">11.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(1.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">2.7</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.4743</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">3.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="15%" align="center" 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">5.2</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.9952</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10.3</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">0.1</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</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">61.3</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.1</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(2.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>National</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right"><font SIZE="2"><b><u>Carrying and
    Fair Value</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>currency</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>September 30, 2007</b></font></td>
    <td WIDTH="15%" align="center" 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>amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>rate</b></font></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="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="center" 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">&nbsp;</td>
    <td WIDTH="12%" 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">&nbsp;</td>
    <td WIDTH="13%" 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">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.4</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3616</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.0</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">0.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.9</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3626</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.7</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">9.1</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3677</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">12.4</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.8</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.9988</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">9.6</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.0</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.9841</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">11.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell CAD/Buy USD</font></td>
    <td WIDTH="15%" align="center" 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">3.8</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="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3.8</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</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">50.4</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.3</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(1.1)</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>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.17</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The following exchange rates applied during the reporting period for the nine
months ended July 6, 2008: </p>
</font>
<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 SIZE="2">Year to date</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">Reporting date</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font SIZE="2">average rate</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">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 SIZE="2"><b>Q3 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Q3 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">CAD to USD</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.0039</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">0.9826</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">EUR to USD</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.4944</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.5703</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom: 2px solid #000000"><font SIZE="2">GBP
    to USD</font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">2.0035</font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">1.9831</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Based on the Company's foreign currency exposures noted above
and the forward foreign exchange contracts in effect during the nine months
ended July 6, 2008, 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="70%"><font SIZE="2"><i>(in US$ 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>
  </tr>
  <tr>
    <td WIDTH="70%">&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="70%">&nbsp;</td>
    <td WIDTH="10%" COLSPAN="3" align="right"><font SIZE="2"><b><u>For the nine
    months ended July 6, 2008</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Source of net earnings variability from changes in foreign
    exchange rates</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" 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="70%"><font SIZE="2">Financial instruments, including forward
    foreign exchange contracts</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">(1.8)</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Future income tax liability and income taxes
    payable</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.3</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="10%" 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">
    <font SIZE="2">Sales and operating expenses</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.1)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.9)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font 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: 2">
    <font SIZE="2">Decrease in net earnings</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">(0.6)</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">(0.2)</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">(0.5)</font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">An assumed 5 percent weakening of the U.S. dollar during the
nine months ended July 6, 2008 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 </p>
</b>
<p align="justify">The Company's interest rate risk is primarily related to the
Company's revolving long-term credit facility, for which amounts drawn are
primarily 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 nine months ended July 6, 2008, an assumed 0.5 percentage point
increase in interest rates during such period would have decreased net earnings
by $0.6 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%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Outlook </font></font></td>
  </tr>
</table>
<p align="justify">A discussion of management's expectations as to the Company's
outlook for fiscal 2008 and fiscal 2009 is contained in the Company's third
quarter earnings results press release dated August 13, 2008 under the section
entitled &quot;Outlook&quot;. The press release is available on the SEDAR website at
www.sedar.com, on the EDGAR website at www.sec.gov and on the Company's website
at www.gildan.com. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.18</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Critical Accounting Estimates </font>
    </font></td>
  </tr>
</table>
<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>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Sales promotional programs; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Trade accounts receivable; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Property, plant and equipment; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Cotton and yarn procurements; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Income taxes; and </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Adoption of New Accounting Standards&nbsp;
    </font></font></td>
  </tr>
</table>
<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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Internal Control Over Financial Reporting&nbsp;&nbsp;
    </font></font></td>
  </tr>
</table>
<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>
<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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Reconciliation and Definition of Non-GAAP
    Measures </font></font></td>
  </tr>
</table>
<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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.19</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Adjusted Net Earnings and Adjusted Diluted EPS </p>
</b>
<p ALIGN="JUSTIFY">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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amounts)</i></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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q3 2008</b></font></td>
    <td WIDTH="11%" align="right" style="border-left-style: solid; border-left-width: 1; 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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">YTD 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" 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="11%" 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="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
    <td WIDTH="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Reported</b></font></td>
    <td WIDTH="11%" 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="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">380.8</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">380.8</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">925.0</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">925.0</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">260.4</b></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"><b>
    <p style="margin-right: 4">260.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">626.1</b></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"><b>
    <p style="margin-right: 4">626.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">120.4</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">120.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">298.9</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">298.9</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Selling, general and administrative</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="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="34%"><font SIZE="2">&nbsp;&nbsp; expenses</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.9</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.9</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">113.1</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">113.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(2.3)</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(3.9)</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" 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"><b>
    <p style="margin-right: 4">74.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">76.5</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">181.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">185.8</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Non-controlling interest of</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="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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.2</b></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"><b>
    <p style="margin-right: 4">0.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.4</b></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"><b>
    <p style="margin-right: 4">0.4</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">57.5</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">59.8</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">132.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">136.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.4</b></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"><b>
    <p style="margin-right: 4">3.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">9.1</b></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"><b>
    <p style="margin-right: 4">9.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">54.1</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">56.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">123.1</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">127.0</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.45</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.02</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.47</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.02</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.03</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.06</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom: 2px solid #000000"><font SIZE="2">
    Diluted E.P.S.</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.44</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.02</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.46</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">1.01</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.03</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">1.04</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%">&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>
    <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="34%">&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>
    <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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amount)</i></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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q3 2007</font></td>
    <td WIDTH="11%" align="right" style="border-left-style: solid; border-left-width: 1; 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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" 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="11%" 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="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
    <td WIDTH="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Reported</font></td>
    <td WIDTH="11%" 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="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">291.6</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">291.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">709.6</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">709.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">197.2</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">197.2</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">482.6</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">482.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">94.4</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">94.4</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">227.0</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">227.0</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Selling, general and administrative</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="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="34%"><font SIZE="2">&nbsp;&nbsp; expenses</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">28.4</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">28.4</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">83.1</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">83.1</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4.6)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(22.3)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" 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">
    <p style="margin-right: 4">61.4</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">66.0</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">121.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">143.9</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10.3</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">10.3</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">28.5</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">28.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</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">1.5</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">3.5</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">3.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Non-controlling interest of</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="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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</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">0.5</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.6</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">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">49.1</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">53.7</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89.0</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">111.3</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(3.3)</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">(3.3)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.2)</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">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="11%" 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">52.4</font></td>
    <td WIDTH="11%" 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">4.6</font></td>
    <td WIDTH="11%" 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">57.0</font></td>
    <td WIDTH="11%" 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">89.2</font></td>
    <td WIDTH="11%" 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">22.3</font></td>
    <td WIDTH="11%" 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">111.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.44</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.48</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.74</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.18</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.92</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom: 2px solid #000000"><font SIZE="2">
    Diluted E.P.S.</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.43</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.47</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.73</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.18</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.92</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary.</i> <i>EPS amounts may not add due to rounding. <sup><br>
(1)</sup>Adjustment to remove restructuring and other charges. See page 8. </p>
</i></font><font SIZE="2"></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.20</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>EBITDA </p>
</b>
<p ALIGN="JUSTIFY">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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="52%"><font SIZE="2"><i>(in $ millions)</i></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>
  </tr>
  <tr>
    <td WIDTH="52%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>YTD 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Net earnings</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">54.0</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">52.4</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">123.2</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89.2</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Depreciation and amortization</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">10.3</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">28.5</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Interest, net</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">3.5</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Income tax expense (recovery)</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">3.4</b></font></td>
    <td align="right"><font SIZE="2">(3.3)</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">9.1</b></font></td>
    <td align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Non-controlling interest of</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.2</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.4</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">EBITDA</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">76.4</b></font></td>
    <td 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">66.0</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">185.9</b></font></td>
    <td 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">143.9</font></td>
  </tr>
</table>
<i><font style="font-size: 9pt">
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup> See page 8. </p>
</font></i><font SIZE="2"><b>
<p>Free Cash Flow </p>
</b>
<p ALIGN="JUSTIFY">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="52%"><font SIZE="2"><i>(in $ millions)</i></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>
  </tr>
  <tr>
    <td WIDTH="52%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>YTD 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Cash flows from operating activities</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">40.7</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">32.3</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">168.4</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">72.1</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash flows from investing activities</font></td>
    <td align="right"><font SIZE="2"><b>(19.2)</b></font></td>
    <td align="right"><font SIZE="2">(29.2)</font></td>
    <td align="right"><font SIZE="2"><b>(213.0)</b></font></td>
    <td align="right"><font SIZE="2">(103.7)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Add back:</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Acquisition of Prewett</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">126.8</b></font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to acquisition</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">10.0</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>Free cash flow</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">21.5</b></font></td>
    <td 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">3.1</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">92.2</b></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(31.6)</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i></font><font SIZE="2"><b>
<p>Total Indebtedness and Cash in Excess of Debt (Net Indebtedness) </p>
</b>
<p>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="64%"><font SIZE="2"><i>(in $ millions)</i></font></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="64%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q4 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Bank indebtedness</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-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">
    <font SIZE="2">(3.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%"><font SIZE="2">Current portion of long-term debt</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>(3.8)</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(3.7)</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(3.9)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(104.7)</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(56.0)</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(39.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>Total indebtedness</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>(108.5)</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(59.7)</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(46.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" 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="64%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cash and cash equivalents</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">13.2</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">9.3</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">7.5</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>(Net indebtedness) Cash in excess of debt</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">
    <font SIZE="2"><b>(95.3)</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">
    <font SIZE="2">(50.4)</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">(38.9)</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.21</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
<p align="justify" style="margin-bottom: 0"><font color="#1060B3">Risks and Uncertainties
</font> </p>
</div>
<p ALIGN="JUSTIFY">The Company is subject to a variety of business risks. The
risks below 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>
<p align="justify">The risks described in our 2007 Annual MD&amp;A, as subsequently
updated in our first and second quarter 2008 MD&amp;A, included discussions relating
to the following important factors: </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Our ability to implement our strategies and plans; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is competitive; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is subject to pricing pressures; </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Our success depends on our ability to anticipate evolving
  consumer preferences and trends; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  operations are subject to environmental regulation; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  rely on a relatively small number of significant customers; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  customers do not commit to purchase minimum quantities; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are exposed to concentrations of credit risk; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are subject to international trade regulation </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">We currently pay income tax at a comparatively low effective
  rate, which could change in the future (see &quot;Updates to the Description of
  Risks and Uncertainties&quot; below); </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">The
  price of the raw materials we buy is prone to significant fluctuations and
  volatility; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  operations are subject to political, social and economic risks; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is subject to fluctuations in sales demand; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  business operations significantly rely on our information systems; </font>
  </li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are subject to foreign currency risk; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  depend on key management; and </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Securities class actions (see &quot;Updates to the Description of Risks and
  Uncertainties&quot; below) </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 as well as our first and second
quarter interim reports similarly filed. </p>
<b>
<p align="justify">Updates to the Description of Risks and Uncertainties </p>
</b>
<p ALIGN="JUSTIFY">The following are significant updates to the description of
risks contained in the section entitled &quot;Risks and Uncertainties&quot; of the Gildan
2007 MD&amp;A, as subsequently updated in our first and second quarter 2008 MD&amp;A.
</p>
<p align="justify"><u>We currently pay income tax at a comparatively low
effective rate, which could change in the future </u></p>
<p ALIGN="JUSTIFY">The Company benefits from a low overall effective corporate
tax rate due to the majority of its global sales, marketing, and manufacturing
operations being carried out in low tax rate jurisdictions in Central America
and the Caribbean Basin. The Company's income tax filings and income tax
provisions reflect tax positions that are based on interpretations of applicable
tax laws, including income tax treaties between various countries in which the
Company operates as well as underlying rules and regulations with respect to
transfer pricing. These interpretations involve judgments and estimates and may
be challenged through government taxation audits that the Company is regularly
subject to. As disclosed in Note 12 to our interim consolidated financial
statements, the Canada Revenue Agency (CRA) is currently conducting an audit of
Gildan's income tax returns for its 2000, 2001, 2002 and 2003 fiscal years, the
scope of which includes a review of transfer pricing and the allocation of
income between the Company's Canadian legal entity and its foreign subsidiaries.
The Company believes its tax filing positions are sustainable based on the
economic substance of its legal and operating structure and the merits of its
transfer pricing methodology as supported by annual transfer pricing studies
conducted by external experts. However, we cannot predict with certainty the
outcome of any audit undertaken by taxation authorities and the final result may
vary compared to the estimates and assumptions used by management in determining
the Company's consolidated income tax provision and in valuing its income tax
assets and liabilities. Depending on the ultimate outcome of any such audit,
there may be a material adverse impact on the Company's financial position,
results of operations and cash flows. In addition, if the Company were to
receive a tax reassessment by a taxation authority prior to the ultimate
resolution of an audit, the Company could be required to submit an advance
deposit on the amount reassessed. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.22</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's overall effective income tax rate may also be
adversely affected by the following: unanticipated changes to current domestic
laws in the countries in which the Company operates; changes to the income tax
treaties the Company currently relies on; changes in the location of the
Company's operations that would result in a higher proportion of taxable income
being reported in higher tax rate jurisdictions; an increase in income tax
rates; and, changes to free trade and export processing zone rules in certain
countries where the Company is not subject to income tax. </p>
<p><u>Securities class actions </u></p>
<p ALIGN="JUSTIFY">The Company and certain of its senior officers have been
named as defendants in a number of proposed class action lawsuits filed in the
United States District Court for the Southern District of New York. These U.S.
lawsuits will likely be consolidated into one proposed class action with a lead
plaintiff. A proposed class action has also been filed in the Ontario Superior
Court of Justice and a petition for authorization to commence a class action has
been filed in the Quebec Superior Court. Each of these U.S. and Canadian
lawsuits, which have yet to be certified as a class action by the respective
courts at this stage, seek to represent a class comprised of persons who
acquired the Company's common shares between August 2, 2007 and April 29, 2008
and allege, among other things, that the defendants misrepresented the Company's
financial prospects in its financial guidance concerning the 2008 fiscal year,
subsequently revised on April 29, 2008. The U.S. lawsuits are based on United
States federal securities laws. In addition to pursuing common law claims, the
Ontario action proposes to seek leave from the Ontario court to also bring
statutory misrepresentation civil liability claims under Ontario's <i>Securities
Act</i>. The Company strongly contests the basis upon which these actions are
predicated and intends to vigorously defend its position. However, due to the
inherent uncertainties of litigation, it is not possible to predict the final
outcome of these lawsuits or determine the amount of any potential losses, if
any. No provision for contingent loss has been recorded in the interim
consolidated financial statements. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Forward-Looking Statements&nbsp; </font>
    </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Certain statements included in this MD&amp;A 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;project&quot;, &quot;assume&quot;, &quot;anticipate&quot;, &quot;plan&quot;, &quot;foresee&quot;, &quot;believe&quot; or
&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, as
subsequently updated in this MD&amp;A and in our first and second quarter 2008 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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.23</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font 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>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font 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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  impact of economic and business conditions, industry trends and other
  external, political and social factors in the countries in which we operate;
  </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  intensity of competitive activity; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  changes in environmental, tax, trade, employment and other laws and
  regulations; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to implement our strategies and plans; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to complete and successfully integrate acquisitions; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  reliance on a small number of significant customers; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font 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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  customers do not commit to minimum quantity purchases; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  seasonality of our business; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to attract and retain key personnel; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">high
  reliance on computerized information systems; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  changes in accounting policies and estimates; and </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  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 write-downs 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. The purpose of the forward-looking
statements is to provide the reader with a description of management's
expectations regarding the Company's fiscal 2008 and 2009 financial performance
and may not be appropriate for other purposes. 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>
<p align="justify">August 12, 2008 </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.24</b></font></td>
  </tr>
</table>
<hr color="#000000" SIZE="5"><p Style='page-break-before:always'><b>
<p align="center">Gildan Activewear Inc.<font SIZE="2"><br>
Interim Consolidated Balance Sheets</font></b><font SIZE="2"><br>
(in thousands of U.S. dollars)</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="right" nowrap><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td COLSPAN="2" align="right" nowrap><font SIZE="2"><u>September 30,
    2007</u></font></td>
    <td align="right" nowrap>&nbsp;</td>
    <td align="right" nowrap><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="right" nowrap><font SIZE="2">(unaudited)</font></td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="right" nowrap><font SIZE="2">(audited)</font></td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="right" nowrap><font SIZE="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td WIDTH="2%" align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2"><b>Assets</b></font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Current assets:</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Cash and cash equivalents</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">13,195</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">9,250</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">7,537</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accounts receivable</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">254,511</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">206,088</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">183,557</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Inventories</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">290,845</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">239,963</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">231,538</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Prepaid expenses and deposits</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">11,255</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">7,959</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">9,573</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Future income taxes</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,765</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">2,610</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">4,601</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">573,571</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">465,870</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">436,806</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Property, plant and equipment</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">426,781</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">377,617</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">368,477</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Goodwill and identifiable intangible assets</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">63,910</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">2,024</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">9,030</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Assets held for sale (note 7)</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">12,603</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">6,610</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">2,434</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Other assets</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">18,227</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">11,426</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">8,266</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Future income taxes</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10,489</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10,939</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Total assets</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">1,105,581</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">874,486</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">825,013</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2"><b>Liabilities and Shareholders' Equity</b></font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Current liabilities:</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Bank indebtedness</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">3,500</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accounts payable and accrued liabilities</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">149,486</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">116,683</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">120,229</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Income taxes payable</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">9,238</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">2,949</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">2,054</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Current portion of long-term debt</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">3,762</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">3,689</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">3,934</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">162,486</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">123,321</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">129,717</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Long-term debt</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">104,677</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">55,971</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">38,979</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Future income taxes</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">41,265</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">24,612</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">28,221</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Non-controlling interest in consolidated
    joint venture</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">7,289</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">6,932</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">6,279</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Contingencies (note 13)</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Shareholders' equity:</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Share capital</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">89,147</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">88,061</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">87,686</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Contributed surplus</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">5,910</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">3,953</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">3,361</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Retained earnings</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">668,559</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">545,388</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">504,522</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accumulated other comprehensive income</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">26,248</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&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">694,807</font></td>
    <td align="right">&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">571,636</font></td>
    <td align="right">&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">530,770</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">789,864</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">663,650</font></td>
    <td align="right">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">621,817</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Total liabilities and shareholders' equity</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">1,105,581</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">874,486</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">825,013</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>See accompanying notes to interim consolidated financial statements.</p>
<p align="right">GILDAN QUARTERLY REPORT - Q3 2008 - P. 25</p>
</font><hr color="#000000" SIZE="5"><p Style='page-break-before:always'><b>
<p align="center">Gildan Activewear Inc.<br>
<font SIZE="2">Interim Consolidated Statements of Earnings and Comprehensive
Income</font></b><font SIZE="2"><br>
(In thousands of U.S. dollars, except per share data)</font></p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="right" nowrap>
    <p align="center"><font SIZE="2"><i><b>Three months ended</b></i></font></td>
    <td align="right" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="right" nowrap>
    <p align="center"><font SIZE="2"><i><b>Nine months ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 1, 2007</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Sales</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">380,774</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">291,610</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">924,994</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">709,573</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cost of sales</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">260,418</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">197,221</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">626,051</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">482,558</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Gross profit</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">120,356</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">94,389</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">298,943</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">227,015</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Selling, general and administrative expenses</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">43,893</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">28,430</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">113,096</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">83,080</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Restructuring and other charges (note 7)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,289</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4,589</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">3,929</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22,339</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Earnings before the undernoted items</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">74,174</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">61,370</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">181,918</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">121,596</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Depreciation and amortization (note 9a)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">15,326</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">10,272</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">43,249</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">28,521</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Interest, net (note 10b)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,204</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,453</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">6,065</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">3,501</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Non-controlling interest of consolidated
    joint venture</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">185</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">503</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">357</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">625</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Earnings before income taxes</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">57,459</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">49,142</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">132,247</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">88,949</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Income tax expense (recovery) (note 12)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">3,448</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(3,255)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">9,076</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(205)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Net earnings and comprehensive income</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">54,011</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">52,397</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">123,171</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">89,154</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Basic EPS (note 8)</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.45</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.44</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1.02</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.74</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Diluted EPS (note 8)</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.44</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.43</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1.01</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">0.73</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>See accompanying notes to interim consolidated financial statements.</p>
<p align="right">GILDAN QUARTERLY REPORT - Q3 2008 - P. 26</p>
</font><hr color="#000000" SIZE="5"><p Style='page-break-before:always'><b>
<p align="center">Gildan Activewear Inc.<br>
<font SIZE="2">Interim Consolidated Statements of Cash Flows</font></b><font SIZE="2"><br>
(In thousands of U.S. dollars)</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="right" nowrap>
    <p align="center"><font SIZE="2"><i><b>Three months ended</b></i></font></td>
    <td align="right" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="right" nowrap>
    <p align="center"><font SIZE="2"><i><b>Nine months ended</b></i></font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 1, 2007</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td WIDTH="2%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="10%" align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
    <td WIDTH="2%" align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">(unaudited)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash flows from operating activities:</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Net earnings</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">54,011</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">52,397</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">123,171</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">89,154</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Adjustments for:</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Restructuring charges related to assets held for
    sale</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">&nbsp;&nbsp;&nbsp; and property, plant and
    equipment (note 7)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,662</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">708</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,334</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">4,616</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Depreciation and amortization (note 9a)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">15,326</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">10,272</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">43,249</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">28,521</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Loss (gain) on disposal of assets held for sale
    and</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">&nbsp;&nbsp;&nbsp; property, plant and equipment</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">861</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(60)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">987</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(20)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Stock-based compensation costs</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">599</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">371</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">2,083</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,149</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Future income taxes</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,718</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(4,689)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">203</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(3,210)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Non-controlling interest</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">185</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">503</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">357</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">625</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Unrealized foreign exchange (gain) loss</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(762)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">3,029</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">253</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,441</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">73,600</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">62,531</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">171,637</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">122,276</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Changes in non-cash working capital balances:</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Accounts receivable</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(68,707)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(45,712)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(18,837)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(16,266)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Inventories</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">9,212</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">11,051</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(7,459)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(30,885)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Prepaid expenses and deposits</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(2,266)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(2,499)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(1,926)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(3,816)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Accounts payable and accrued liabilities</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">27,741</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">5,354</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">18,822</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,119</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 30">Income taxes payable</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,081</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,607</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">6,156</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(338)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">40,661</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">32,332</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">168,393</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">72,090</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash flows (used in) from financing
    activities:</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">(Decrease) increase in amounts drawn under
    revolving long-term</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">&nbsp;&nbsp; credit facility</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(37,000)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(13,000)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">51,000</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">30,000</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Decrease in bank indebtedness</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(1,261)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Net decrease in other long-term debt</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(896)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(18,266)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(2,221)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(20,948)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Proceeds from the issuance of shares</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">351</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">180</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">960</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">949</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(37,545)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">(31,086)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">48,478</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">10,001</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash flows used in investing activities:</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Purchase of property, plant and equipment</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(19,773)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(32,864)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(79,791)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(108,315)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Acquisition of V.I. Prewett &amp; Son, Inc. (note 4)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(126,819)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to acquistion (note 4)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(10,000)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Proceeds on disposal of assets held for sale</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">10</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">4,429</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,124</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">6,424</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">
    <p style="margin-left: 15">Net decrease (increase) in other assets</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">565</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(778)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,532</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(1,786)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(19,198)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(29,213)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(212,954)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(103,677)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Effect of exchange rate changes on cash and</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">&nbsp;&nbsp; cash equivalents denominated in
    foreign currencies</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(34)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">23</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">28</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">116</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Net (decrease) increase in cash and cash
    equivalents</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">&nbsp;&nbsp; during the period</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(16,116)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(27,944)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">3,945</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(21,470)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash and cash equivalents, beginning of
    period</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">29,311</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">35,481</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">9,250</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">29,007</font></td>
  </tr>
  <tr>
    <td WIDTH="52%">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash and cash equivalents, end of period</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">13,195</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">7,537</font></td>
    <td align="right"><font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">13,195</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">7,537</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>See accompanying notes to interim consolidated financial statements.</p>
<p>Supplemental disclosure of cash flow information (note 9)</p>
<p align="right">GILDAN QUARTERLY REPORT - Q3 2008 - P. 27</p>
</font><hr color="#000000" SIZE="5"><p Style='page-break-before:always'><b>
<p align="center">Gildan Activewear Inc.<br>
<font SIZE="2">Interim Consolidated Statement of Shareholders' Equity and
Comprehensive Income <br>
Nine months ended July 6, 2008 and July 1, 2007</font></b><font SIZE="2"><br>
(in  thousands of U.S. dollars)</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td COLSPAN="2" align="center" nowrap><font SIZE="2">Accumulated</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td COLSPAN="3" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">
    <p align="center">Share Capital</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap colspan="2"><font SIZE="2">other</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap colspan="2"><font SIZE="2">Total</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="center" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td COLSPAN="2" align="center" nowrap><font SIZE="2">Contributed</font></td>
    <td COLSPAN="2" align="center" nowrap><font SIZE="2">comprehensive</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap><font SIZE="2">Retained</font></td>
    <td COLSPAN="2" align="center" nowrap><font SIZE="2">shareholders'</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">Number</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">Amount</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">surplus</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap colspan="2">
    <font SIZE="2">income</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">earnings</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap colspan="2">
    <font SIZE="2">equity</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Balance, September 30, 2007</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">120,419</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">88,061</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">3,953</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">26,248</font></td>
    <td align="right">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">&nbsp;545,388</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">663,650</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Stock-based compensation related to</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; stock options and Treasury</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="2%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; restricted share units</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">2,083</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">2,083</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued under employee share</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; purchase plan</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">16</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">543</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">543</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued pursuant to exercise of</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; stock options</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">81</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">417</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">417</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued pursuant to the</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; settlement of Treasury
    restricted</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; share units</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">8</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">126</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">(126)</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Net earnings</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">123,171</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">123,171</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Balance, July 6, 2008 (unaudited)</font></td>
    <td 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">120,524</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td 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">89,147</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">5,910</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td 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">26,248</font></td>
    <td align="right">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: double; border-bottom-width: 3">
    <font SIZE="2">
    <p style="margin-right: 4">&nbsp;668,559</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td 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">789,864</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td COLSPAN="2" align="center"><font SIZE="2">Accumulated</font></td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p align="center">Share Capital</font></td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td align="center" colspan="2"><font SIZE="2">other</font></td>
    <td align="center">&nbsp;</td>
    <td align="center">&nbsp;</td>
    <td align="center" colspan="2"><font SIZE="2">Total</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td COLSPAN="2" align="center"><font SIZE="2">Contributed</font></td>
    <td COLSPAN="2" align="center"><font SIZE="2">comprehensive</font></td>
    <td align="center">&nbsp;</td>
    <td align="center"><font SIZE="2">Retained</font></td>
    <td COLSPAN="2" align="center"><font SIZE="2">shareholders'</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Number</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Amount</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">surplus</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" colspan="2">
    <font SIZE="2">income</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">earnings</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" colspan="2">
    <font SIZE="2">equity</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Balance, October 1, 2006</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">120,228</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">86,584</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">2,365</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">26,248</font></td>
    <td align="right">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">415,368</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">530,565</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Stock-based compensation related to</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; stock options and Treasury</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; restricted share units</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,149</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,149</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued under employee share</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; purchase plan</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">13</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">378</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">378</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued pursuant to exercise of</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; stock options</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">117</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">571</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">571</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Shares issued pursuant to the</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; settlement of Treasury
    restricted</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">&nbsp;&nbsp;&nbsp; share units</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">18</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">153</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">(153)</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Net earnings</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89,154</font></td>
    <td align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89,154</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Balance, July 1, 2007 (unaudited)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">120,376</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">87,686</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">3,361</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">26,248</font></td>
    <td align="right">
    <p style="margin-right: 4"><font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">504,522</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom: 3px double #000000">
    <font SIZE="2">
    <p style="margin-right: 4">621,817</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p align="right">GILDAN QUARTERLY REPORT - Q3 2008 - P. 28</p>
</font><hr color="#000000" SIZE="5"><p Style='page-break-before:always'><font SIZE="2"><b>
<p><u>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS <br>
</u>(For the period ended July 6, 2008) <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:</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
financial statements. Accordingly, they do not include all of the information
and footnotes required by Canadian generally accepted accounting principles for
annual financial statements, and should be read in conjunction with the
Company's most recently prepared annual consolidated financial statements for
the year ended September 30, 2007. </p>
<p align="justify">The Company's revenues and income are subject to seasonal
variations. Consequently, the results of operations for the third fiscal quarter
are traditionally not indicative of the results to be expected for the full
fiscal year. </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, 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 - Disclosure, and CICA Handbook Section 3863, Financial
Instruments - Presentation. These new Handbook Sections apply to fiscal years
beginning on or after October 1, 2007. These 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 $126.8 million (including
transaction costs of $1.5 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 independent 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>
<p align="right">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.29 </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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </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 style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-left: 30">Assets acquired:</font></td>
    <td WIDTH="3%" 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">
    <p style="margin-right: 30">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Accounts receivable</font></td>
    <td WIDTH="3%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">28,805</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Inventories</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">43,423</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Prepaid expenses</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">1,370</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Property, plant and equipement</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">20,202</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Goodwill and identifiable intangible assets</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">64,376</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Other assets</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">176</font></td>
  </tr>
  <tr>
    <td>
    <p style="margin-left: 30">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 30">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 30">Liabilities assumed:</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 30">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Bank indebtedness</font></td>
    <td WIDTH="3%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 26">(1,261)</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 26">(14,178)</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 45">Future income taxes</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 26">(16,094)</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 30">Net assets acquired</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td WIDTH="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: 30">126,819</font></td>
  </tr>
  <tr>
    <td>
    <p style="margin-left: 30">&nbsp;</td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 30">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 30">Consideration:</font></td>
    <td WIDTH="3%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 30">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 45">Cash</font></td>
    <td WIDTH="3%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 30">125,294</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 45">Transaction costs</font></td>
    <td WIDTH="3%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 30">1,525</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 30">Purchase price</font></td>
    <td WIDTH="3%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td WIDTH="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: 30">126,819</font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">Goodwill recorded in connection with this acquisition is not
deductible for tax purposes. Identifiable intangible assets consists primarily
of customer contracts and customer relationships and are currently being
amortized on a straight-line basis over a period of 15 years based on
preliminary estimates of the useful life of these assets. </p>
<p align="justify">Goodwill represents the excess of the purchase price over the
fair value of net assets acquired. Goodwill is not amortized and is tested for
impairment annually, or more frequently if events or changes in circumstances
indicate that the asset might be impaired. When the carrying amount of a
reporting unit exceeds the estimated fair value of the reporting unit, an
impairment loss is recognized in an amount equal to the excess of the carrying
value over the fair value of the goodwill, if any. </p>
<b>
<p align="justify">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 align="justify">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="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">Weighted average</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" nowrap>
    <font SIZE="2">Number</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">exercise price</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">(in Canadian dollars)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Options outstanding, September 30, 2007</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">853</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">10.08</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Granted</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">127</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">39.37</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Exercised</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(81)</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">5.32</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forfeited</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(13)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">32.41</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Options outstanding, July 6, 2008</font></td>
    <td WIDTH="15%" 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">886</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">14.42</font></td>
  </tr>
</table>
<font size="2">
<p ALIGN="JUSTIFY">As at July 6, 2008, 625,200 of the outstanding options were
exercisable at the weighted average price of CA$6.67. Based on the Black-Scholes
option pricing model, the grant date weighted average fair value of the options
granted during the nine months ended July 6, 2008 was CA$12.98. </p>
</font><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.30
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </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="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">Weighted average</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" nowrap>
    <font SIZE="2">Number</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">fair value per unit</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">(in Canadian dollars)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Treasury RSUs outstanding, September 30, 2007</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">941</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">18.83</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Granted</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">43</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">36.47</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Settled through the issuance of common shares</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(8)</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">17.89</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forfeited</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(69)</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">27.85</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Treasury RSUs outstanding, July 6, 2008</font></td>
    <td WIDTH="15%" 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">907</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">18.99</font></td>
  </tr>
</table>
<font SIZE="2">
<p>As at July 6, 2008, none of the awarded and outstanding Treasury RSUs were
vested. </p>
<p ALIGN="JUSTIFY">The compensation expense recorded for the three-month periods
ended July 6, 2008 and July 1, 2007, respectively, was $0.6 million and $0.4
million, in respect of the Treasury RSUs and stock options. The compensation
expense recorded for the nine-month periods ended July 6, 2008 and July 1, 2007,
respectively, was $2.1 million and $1.2 million, in respect of the Treasury RSUs
and stock options. The counterpart has been recorded as contributed surplus.
When the common 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="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="50%" 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="50%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Non-Treasury RSUs outstanding, September 30, 2007</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">56</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Granted</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">50</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forfeited</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4)</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Non-Treasury RSUs outstanding, July 6, 2008</font></td>
    <td WIDTH="50%" 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">102</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 July 6, 2008, the
weighted average fair value per non-Treasury RSU was CA$24.36. No common shares
are issued from treasury under such awards and they are therefore non-dilutive.
As of July 6, 2008, none of the awarded and outstanding non-Treasury RSUs were
vested. </p>
<p ALIGN="JUSTIFY">The compensation (recovery) expense recorded for the
three-month periods ended July 6, 2008 and July 1, 2007, respectively, was
$(0.1) million and $0.1 million, in respect of the non-Treasury RSUs. The
compensation expense recorded for the nine-month periods ended July 6, 2008 and
July 1, 2007, respectively, was $0.4 million and $0.4 million, in respect of the
non-Treasury RSUs. The counterpart has been recorded in accounts payable and
accrued liabilities. </p>
<b>
<p>6. Guarantees: </p>
</b>
<p align="justify">The Company, and certain of its subsidiaries, have granted
corporate guarantees, irrevocable standby letters of credit and surety bonds to
third parties to indemnify them in the event the Company and certain of its
subsidiaries do not perform their contractual obligations. As at July 6, 2008,
the maximum potential liability under these guarantees was $17.4 million, of
which $5.2 million was for surety bonds and $12.2 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 July 6, 2008, the Company has recorded no liability
with respect to these guarantees, as the Company does not expect to make any
payments for the aforementioned items. Management has determined 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><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.31
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>7. Restructuring and other charges, and assets held for sale: </p>
</b>
<p>The following table summarizes the components of restructuring and other
charges: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap><font SIZE="2"><b>Three months ended</b></font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap><font SIZE="2"><b>Nine months ended</b></font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Accelerated depreciation</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">766</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,892</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Gain on disposal of long-lived assets</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(38)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(58)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(366)</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">(1,836)</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Asset impairment loss</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,700</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,700</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">3,560</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Severance</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">400</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">1,234</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">400</font></td>
    <td align="right">
    <p>&nbsp;</td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">13,296</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">227</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,647</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,195</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4,427</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p>$</font></td>
    <td 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">2,289</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">4,589</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p>$</font></td>
    <td 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">3,929</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p>$</font></td>
    <td 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">22,339</font></td>
  </tr>
</table>
<font SIZE="2">
<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
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. Other costs relate primarily to exit costs
incurred in connection with the closures noted above, including carrying and
dismantling costs associated with assets held for sale. During the third quarter
of fiscal 2008, the Company recorded an impairment loss on property, plant and
equipment of $1.7 million resulting from a planned consolidation of its sewing
operations in Haiti. </p>
<p ALIGN="JUSTIFY">Assets held for sale of $12.6 million as at July 6, 2008
(September 30, 2007 - $6.6 million; July 1, 2007 - $2.4 million) primarily
related to closed facilities at these various locations and are recorded at the
lower of their carrying value or fair value less costs to sell. Additional
carrying costs related to these closed facilities and any gains or losses on the
disposition of the assets held for sale will be accounted for as restructuring
charges as incurred. </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>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap><font SIZE="2"><b>Three months ended</b></font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap><font SIZE="2"><b>Nine months ended</b></font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap>&nbsp;</td>
    <td align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Basic earnings per share:</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Basic weighted average number of common shares</font></td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">&nbsp;&nbsp; outstanding</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,492</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,359</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,462</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">120,319</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 15">Basic earnings per share</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.45</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.44</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">1.02</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.74</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Diluted earnings per share:</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Basic weighted average number or common shares</font></td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">&nbsp;&nbsp; outstanding</font></td>
    <td COLSPAN="2" align="right"><font SIZE="2">120,492</font></td>
    <td COLSPAN="2" align="right"><font SIZE="2">120,359</font></td>
    <td COLSPAN="2" align="right"><font SIZE="2">120,462</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">120,319</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Plus impact of stock options and Treasury RSUs</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,130</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,240</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,181</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1,206</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Diluted weighted average number of common shares</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">&nbsp;&nbsp; outstanding</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121,622</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121,599</font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121,643</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">121,525</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 15">Diluted earnings per share</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.44</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.43</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">1.01</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.73</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Excluded from the above calculation for the three months
ended July 6, 2008 are 123,565 stock options, which were deemed to be
anti-dilutive because the exercise prices were greater than the average market
price of the common shares for the period. Excluded from the above calculation
for the nine months ended July 6, 2008 are 81,968 stock options, which were
deemed to be anti-dilutive because the exercise prices were greater than the
average market price of the common shares for the period. All stock options
outstanding for the three months ended December 30, 2007 and for fiscal 2007
were dilutive. </p>
</font><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.32</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>9. Other information:</b> </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="6%"><font SIZE="2"><b>Three months
    ended</b></font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="6%"><font SIZE="2"><b>Nine months
    ended</b></font></td>
  </tr>
  <tr>
    <td><font SIZE="2">(a) The following items were included in
    depreciation</font></td>
    <td WIDTH="6%" align="right" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp; and amortization:</font></td>
    <td WIDTH="6%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Depreciation of property, plant and equipment</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">13,155</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">9,612</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">38,673</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">26,791</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Impairment loss and writedown of property,
    plant</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; and equipment</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">700</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">700</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Amortization expense of deferred start-up
    costs and other</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">454</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">499</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,385</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,247</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Amortization expense of intangible assets</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">1,017</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">161</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">2,491</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">483</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">15,326</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">10,272</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">43,249</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">28,521</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(b) Cash paid during the period for:</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Interest</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">1,459</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">1,842</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">6,515</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">4,065</font></td>
  </tr>
  <tr>
    <td style="border-bottom: 2px solid #000000"><font SIZE="2">
    Income taxes</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">461</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">482</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">2,799</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">3,798</font></td>
  </tr>
</table>
<p>&nbsp;</p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p style="margin-left: 15" align="right"><font SIZE="2"><u>September 30,
    2007</u></font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(c) Non-cash transactions as at:</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">(audited)</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Additions to property, plant and equipment</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; included in accounts payable and
    accrued liabilities</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">500</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">2,566</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">2,652</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Ascribed value credited to share capital from</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; issuance of Treasury RSUs</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">126</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">226</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">153</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Reversal of valuation allowance on acquired</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; future income tax assets
    credited to intangible</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; assets</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">7,340</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Proceeds on disposal of long-lived assets in</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">&nbsp;&nbsp; other assets</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,477</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,855</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,943</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Proceeds on disposal of long-lived assets in
    accounts</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom: 2px solid #000000"><font SIZE="2">&nbsp;&nbsp;
    receivable</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">1,380</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">1,050</font></td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom: 2px solid #000000" width="6%">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(d) Cash and cash equivalents consist of:</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Cash balances with banks</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">10,237</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">9,250</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">7,537</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Short-term investments</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">2,958</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">-</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">13,195</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">9,250</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">7,537</font></td>
  </tr>
</table>
<font size="2"><b>
<p>10. Financial instruments: </p>
</b></font>
<p ALIGN="JUSTIFY"><font size="2">In the first quarter of fiscal 2008, the
Company 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. </font></p>
<p ALIGN="JUSTIFY"><font size="2">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 and nine months ended
July 6, 2008, which is included in the <i>Gildan Q3 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. </font></p>
<font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.33</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>10. Financial instruments (continued): </p>
</b>
<p>(a) Financial instruments &#150; carrying values and fair values: </p>
<p>The fair values of financial assets and liabilities, together with the
carrying amounts included in the consolidated balance sheets, are as follows:
</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="center" colspan="3" nowrap width="6%"><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="6%"><font SIZE="2"><u>September 30,
    2007</u></font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">Carrying</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">Fair</font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">Carrying</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">Fair</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">amount</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">value</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">amount</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">value</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><u>Financial assets</u></font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Available-for-sale financial assets:</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Cash and cash equivalents</font></td>
    <td WIDTH="6%" align="right"><font SIZE="2">$</font></td>
    <td WIDTH="6%" align="right"><font SIZE="2">&nbsp;13,195</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">&nbsp;13,195</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">9,250</font></td>
    <td align="right" width="6%"><font SIZE="2">$</font></td>
    <td align="right" width="6%"><font SIZE="2">9,250</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Loans and receivables:</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accounts receivable - trade</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">236,912</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">236,912</font></td>
    <td COLSPAN="2" align="right" width="6%"><font SIZE="2">189,070</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">189,070</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accounts receivable - other</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">17,599</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">17,599</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">17,018</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">17,018</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Long-term receivable included in other assets</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,477</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,477</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,855</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,855</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to Prewett acquisition</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">&nbsp;&nbsp; included in other assets</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">10,000</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">10,000</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Forward foreign exchange contracts</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">123</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">123</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">293</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">293</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2"><u>Financial liabilities</u></font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Other financial liabilities:</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Accounts payable and accrued liabilities</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">147,428</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">147,428</font></td>
    <td COLSPAN="2" align="right" width="6%"><font SIZE="2">115,596</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">115,596</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Long-term debt - bearing interest at variable
    rates:</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 30">Revolving long-term credit facility</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">100,000</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">100,000</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">49,000</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">49,000</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 30">Other long-term debt</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">6,727</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">6,727</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">8,803</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">8,803</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">
    <p style="margin-left: 15">Long-term debt - bearing interest at fixed rates</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,712</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,712</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,857</font></td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">1,857</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Forward foreign exchange contracts</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">2,058</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">2,058</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">1,087</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">1,087</font></td>
  </tr>
</table>
<font 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 approximate their respective
carrying amounts. The fair value of forward foreign exchange contracts was
determined using quoted market values. </p>
<p>(b) 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>(i) Interest income and expense: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap width="2%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="4%"><font SIZE="2"><b>Three months ended</b></font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="6%"><font SIZE="2"><b>Nine months ended</b></font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td align="center" nowrap width="6%">
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Interest expense on long-term indebtedness</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,294</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,393</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">6,357</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p>$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">3,578</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Interest expense on short-term indebtedness</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">
    <p style="margin-right: 4">4</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">79</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">38</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">219</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Interest income on available-for-sale
    financial assets</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(106)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(85)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(349)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(400)</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Interest income on loans and receivables</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(20)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(60)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other interest</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">32</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">66</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">79</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">104</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Interest expense - net</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">1,204</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">1,453</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">6,065</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">3,501</font></td>
  </tr>
</table>
<font size="2">
<p ALIGN="JUSTIFY">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 PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.34
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>10. Financial instruments (continued): </p>
</b>
<p>(ii) Foreign exchange gain (loss): </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td nowrap>&nbsp;</td>
    <td align="center" nowrap width="2%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="4%"><font SIZE="2"><b>Three months
    ended</b></font></td>
    <td align="center" nowrap width="6%">&nbsp;</td>
    <td COLSPAN="3" align="center" nowrap width="6%"><font SIZE="2"><b>Nine months
    ended</b></font></td>
  </tr>
  <tr>
    <td nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="6%" align="center" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>&nbsp;</td>
    <td WIDTH="6%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">Gain (loss) relating to financial assets and liabilities,</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td nowrap><font SIZE="2">&nbsp;&nbsp;&nbsp; excluding forward foreign
    exchange contracts</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p>$</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">120</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p>$</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">(759)</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p>$</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">1,321</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p>$</font></td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">344</font></td>
  </tr>
  <tr>
    <td nowrap><font SIZE="2">Gain (loss) relating to forward exchange
    contracts,</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td nowrap><font SIZE="2">&nbsp;&nbsp;&nbsp; including amounts realized
    on contract maturity</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">&nbsp;&nbsp;&nbsp; and changes in fair value of open
    positions</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">185</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">2,333</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">(2,189)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">2,659</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1" nowrap>
    <font SIZE="2">Foreign exchange gain (loss) relating</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" nowrap width="6%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td nowrap><font SIZE="2">&nbsp;&nbsp;&nbsp; to financial instruments</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">305</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">1,574</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%"><font SIZE="2">(868)</font></td>
    <td align="right" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" nowrap width="6%"><font SIZE="2">
    <p style="margin-right: 4">3,003</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <font SIZE="2">Other foreign exchange gain (loss)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">26</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">(2,282)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">222</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <font SIZE="2">(1,319)</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap>
    <font SIZE="2">Foreign exchange gain (loss)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">331</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">(708)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">(646)</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" nowrap width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">1,684</font></td>
  </tr>
</table>
<font SIZE="2">
<p>(iii) Impairment losses recognized on trade receivables: </p>
<p ALIGN="JUSTIFY">The Company recorded bad debt expense (recovery) of $2.5
million (2007 - $(0.2) million) for the three month period ended July 6, 2008
and $2.6 million (2007 - $0.1 million) for the nine month period ended July 6,
2008. Bad debt expense is included in &quot;Selling, general and administrative
expenses&quot; in the interim consolidated statements of earnings and comprehensive
income. </p>
<p>(c) Forward foreign exchange contracts: </p>
<p>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 July 6, 2008 and September 30, 2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right"><font SIZE="2"><b>Notional foreign</b></font></td>
    <td align="right"><font SIZE="2"><b>Average</b></font></td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Notional USD</b></font></td>
    <td COLSPAN="4" align="right"><u><font SIZE="2"><b>Carrying &amp; fair
    value</b></font></u></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>July 6, 2008</b></font></td>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Maturity</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>currency amount</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>exchange rate</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>equivalent</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td><font SIZE="2">0-6 months</font></td>
    <td align="right"><font SIZE="2">35,500</font></td>
    <td align="right"><font SIZE="2">0.9923</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">35,225</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">-</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">(457)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td WIDTH="8%" align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td><font SIZE="2">0-6 months</font></td>
    <td align="right"><font SIZE="2">8,485</font></td>
    <td align="right"><font SIZE="2">1.3963</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">11,848</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(1,404)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font SIZE="2">6-12 months</font></td>
    <td align="right"><font SIZE="2">2,650</font></td>
    <td align="right"><font SIZE="2">1.4743</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">3,907</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(197)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell GBP/Buy USD</font></td>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">0-6 months</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">5,172</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.9952</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10,319</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">123</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">61,299</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">123</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(2,058)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right"><font SIZE="2"><b>Notional foreign</b></font></td>
    <td align="right"><font SIZE="2"><b>Average</b></font></td>
    <td COLSPAN="2" align="right"><font SIZE="2"><b>Notional USD</b></font></td>
    <td COLSPAN="4" align="right"><u><font SIZE="2"><b>Carrying &amp; fair
    value</b></font></u></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>September 30, 2007</b></font></td>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Maturity</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>currency amount</b></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>exchange rate</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>equivalent</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Buy EUR/Sell USD</font></td>
    <td><font SIZE="2">0-6 months</font></td>
    <td align="right"><font SIZE="2">4,425</font></td>
    <td align="right"><font SIZE="2">1.3616</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">6,025</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">293</font></td>
    <td align="right"><font SIZE="2">$</font></td>
    <td align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td><font SIZE="2">0-6 months</font></td>
    <td align="right"><font SIZE="2">4,899</font></td>
    <td align="right"><font SIZE="2">1.3626</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">6,675</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(278)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font SIZE="2">6-12 months</font></td>
    <td align="right"><font SIZE="2">9,081</font></td>
    <td align="right"><font SIZE="2">1.3677</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">12,421</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(467)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Sell GBP/Buy USD</font></td>
    <td><font SIZE="2">0-6 months</font></td>
    <td align="right"><font SIZE="2">4,781</font></td>
    <td align="right"><font SIZE="2">1.9988</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">9,558</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(146)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font SIZE="2">6-12 months</font></td>
    <td align="right"><font SIZE="2">6,019</font></td>
    <td align="right"><font SIZE="2">1.9841</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">11,942</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">-</font></td>
    <td align="right">&nbsp;</td>
    <td align="right"><font SIZE="2">(196)</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell CAD/Buy USD</font></td>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">0-6 months</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,800</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.0055</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3,821</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">50,442</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">293</font></td>
    <td 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 align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(1,087)</font></td>
  </tr>
</table>
<font size="2">
<p align="justify">The forward exchange contracts are reported on a
mark-to-market basis and the gains or losses are included in earnings as the
Company has elected not to follow hedge accounting for these derivatives. </p>
</font><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.35
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>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 3.0:1. 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 July 6, 2008, September
30, 2007 and July 1, 2007 was as follows: </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">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">July 6, 2008</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right" style="margin-left: 20">
    <font SIZE="2">September 30, 2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">July 1, 2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Bank indebtedness</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">3,500</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Current portion of long-term debt</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">3,762</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">3,689</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">3,934</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Long-term debt</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">
    <p style="margin-right: 4">104,677</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">
    <p style="margin-right: 4">55,971</font></td>
    <td WIDTH="6%" align="right">
    <p>&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">
    <p style="margin-right: 4">38,979</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Less: cash and cash equivalents</font></td>
    <td WIDTH="6%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">(13,195)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td WIDTH="6%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(9,250)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">(7,537)</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net debt</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">95,244</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">50,410</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">38,876</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="center" colspan="6" width="6%"><font SIZE="2"><i>For the last
    four quarters ending on</i></font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p align="right">
    <font SIZE="2">July 6, 2008</font></td>
    <td COLSPAN="2" align="center" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p align="right" style="margin-left: 20">
    <font SIZE="2">September 30, 2007</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p align="right">
    <font SIZE="2">July 1, 2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Net earnings</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">164,037</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">130,020</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">105,942</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Restructuring and other charges</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">9,602</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">28,012</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">42,725</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Depreciation and amortization</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">53,505</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">38,777</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">37,593</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Interest, net</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">7,462</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">4,898</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">4,540</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Income tax expense (recovery)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">4,466</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">(4,815)</font></td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">
    <p style="margin-right: 4">917</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Non-controlling interest in income of consolidated joint
    venture</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">1,010</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">1,278</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p>&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">645</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">EBITDA</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">240,082</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">198,170</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p>$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">192,362</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" width="6%">
    <p>&nbsp;</td>
    <td align="right" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Net debt to EBITDA ratio</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">0.4:1</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">0.3:1</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <p style="margin-right: 4">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">
    <p style="margin-right: 4">0.2:1</font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">The terms of the revolving credit facility require the
Company to maintain a net debt to EBITDA ratio below 3.0:1, although this limit
may be exceeded under certain circumstances. 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 is
well below the Company's maximum net debt to EBITDA ratio. 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 maintain or adjust its capital structure, the
Company, upon approval from its Board of Directors, may issue or repay long-term
debt, issue shares, repurchase shares, pay dividends or undertake other
activities as deemed appropriate under the specific circumstances. The Company
does not currently pay a dividend. However, the Company's Board of Directors
periodically evaluates the merits of introducing a dividend. </p>
<p align="justify">The Company is not subject to any capital requirements
imposed by a regulator. </p>
</font><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.36
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>12. Income taxes: </p>
</b>
<p ALIGN="JUSTIFY">The Canada Revenue Agency (&quot;CRA&quot;) is currently conducting an
audit of the Company's income tax returns for its 2000, 2001, 2002 and 2003
fiscal years, the scope of which includes a review of transfer pricing and the
allocation of income between the Company's Canadian legal entity and its foreign
subsidiaries. In the third quarter of fiscal 2008, management met with the CRA
for the first time to discuss preliminary transfer pricing audit issues and, in
particular, explain the roles and responsibilities performed in the Company's
foreign subsidiaries where the majority of its taxable income is earned. The
Company is continuing its discussion with the CRA and is confident that the
merits of its transfer pricing methodology<i>, </i>which is supported by annual
transfer pricing studies conducted by external experts, and the economic
substance of its legal and operating structure support its tax filings. While
the outcome of the audit cannot be predicted with certainty, the Company
believes that its tax filing positions will be sustained and that the final
resolution of this matter will not materially affect the Company's results of
operations or financial position. </p>
<p ALIGN="JUSTIFY">The income tax recovery of $3.3 million for the three-month
period ended July 1, 2007 and of $0.2 million for the nine-month period ended
July 1, 2007 includes the recognition of previously unrecorded tax benefits in
the amount of $5.7 million relating to a prior taxation year. </p>
<b>
<p>13. Contingencies: </p>
</b>
<p ALIGN="JUSTIFY">The Company and certain of its senior officers have been
named as defendants in a number of proposed class action lawsuits filed in the
United States District Court for the Southern District of New York. These U.S.
lawsuits will likely be consolidated into one proposed class action with a lead
plaintiff. A proposed class action has also been filed in the Ontario Superior
Court of Justice and a petition for authorization to commence a class action has
been filed in the Quebec Superior Court. Each of these U.S. and Canadian
lawsuits, which have yet to be certified as a class action by the respective
courts at this stage, seek to represent a class comprised of persons who
acquired the Company's common shares between August 2, 2007 and April 29, 2008
and allege, among other things, that the defendants misrepresented the Company's
financial prospects in its financial guidance concerning the 2008 fiscal year,
subsequently revised on April 29, 2008. The U.S. lawsuits are based on United
States federal securities laws. In addition to pursuing common law claims, the
Ontario action proposes to seek leave from the Ontario court to also bring
statutory misrepresentation civil liability claims under Ontario's <i>Securities
Act</i>. The Company strongly contests the basis upon which these actions are
predicated and intends to vigorously defend its position. However, due to the
inherent uncertainties of litigation, it is not possible to predict the final
outcome of these lawsuits or determine the amount of any potential losses, if
any. No provision for contingent loss has been recorded in the interim
consolidated financial statements. </p>
<b>
<p>14. 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td COLSPAN="2" align="center" nowrap width="8%"><font SIZE="2"><b>Three months
    ended</b></font></td>
    <td align="center" colspan="2" nowrap width="8%"><font SIZE="2"><b>Nine months
    ended</b></font></td>
  </tr>
  <tr>
    <td><font SIZE="2">The company has two customers accounting for
    at</font></td>
    <td WIDTH="8%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="8%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
    <td WIDTH="8%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 6,</font></td>
    <td WIDTH="8%" align="center" nowrap>
    <p align="right"><font SIZE="2">July 1,</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; least 10% of total sales:</font></td>
    <td WIDTH="8%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td WIDTH="8%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
    <td WIDTH="8%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2008</font></td>
    <td WIDTH="8%" align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap>
    <p align="right">
    <font SIZE="2">2007</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Company A</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">25.1%</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">22.2%</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">23.2%</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">22.2%</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Company B</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">11.7%</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">2.6%</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">15.5%</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">5.5%</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">&nbsp;</td>
  </tr>
  <tr>
    <td><font SIZE="2">Sales were derived from customers located in
    the</font></td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; following geographic areas:</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">United States</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 338,130</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 255,281</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 833,230</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 627,758</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">Canada</font></td>
    <td align="right" width="8%"><font SIZE="2">19,604</font></td>
    <td align="right" width="8%"><font SIZE="2">16,456</font></td>
    <td align="right" width="8%"><font SIZE="2">42,217</font></td>
    <td align="right" width="8%"><font SIZE="2">39,021</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Europe and other</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">23,040</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">19,873</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">49,547</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">42,794</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 380,774</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 291,610</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 924,994</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 709,573</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
    <td align="right" width="8%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sales by major product group:</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Activewear and underwear</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 306,407</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 261,087</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 703,457</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="8%">
    <font SIZE="2">$ 603,646</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Socks</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">74,367</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">30,523</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">221,537</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="8%">
    <font SIZE="2">105,927</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 380,774</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 291,610</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 924,994</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="8%">
    <font SIZE="2">$ 709,573</font></td>
  </tr>
</table>
<font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.37
</font></p>
<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%" height="45">
  <tr>
    <td width="50%" height="26"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%" height="26">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%" height="19">&nbsp;</td>
    <td width="50%" height="19"><font SIZE="2" color="#808080">
    <p align="right"><b>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS</b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>14. Segmented information (continued): </p>
</b></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap width="12%" colspan="2">
    <p align="right"><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p align="right" style="margin-left: 15"><font SIZE="2"><u>September 30,
    2007</u></font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p align="right"><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Property, plant and equipment by geographic areas are as
    follows:</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">(audited)</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Caribbean Basin and Central America</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">321,613</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">294,063</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td WIDTH="6%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">276,000</font></td>
  </tr>
  <tr>
    <td><font SIZE="2">United States</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td WIDTH="6%" align="right"><font SIZE="2">80,486</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">65,399</font></td>
    <td WIDTH="6%" align="right">&nbsp;</td>
    <td align="right" width="6%"><font SIZE="2">69,163</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Canada and other</font></td>
    <td WIDTH="6%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">24,682</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">18,155</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">23,314</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">426,781</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">377,617</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">368,477</font></td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
    <td align="right" width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td align="center" nowrap width="12%" colspan="2">
    <p align="right"><font SIZE="2"><u>July 6, 2008</u></font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p align="right" style="margin-left: 15"><font SIZE="2"><u>September 30,
    2007</u></font></td>
    <td COLSPAN="2" align="center" nowrap width="6%">
    <p align="right"><font SIZE="2"><u>July 1, 2007</u></font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Assets held for sale by geographic areas are as follows:</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">
    <p align="right">
    <font SIZE="2">(audited)</font></td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
    <td align="center" style="border-bottom-style: solid; border-bottom-width: 1" nowrap width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">United States</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">2,200</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">2,278</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1" width="6%">
    <font SIZE="2">1,934</font></td>
  </tr>
  <tr>
    <td style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Canada and other</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">10,403</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">4,332</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">&nbsp;</td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1" width="6%">
    <font SIZE="2">500</font></td>
  </tr>
  <tr>
    <td style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">12,603</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">6,610</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">$</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" width="6%">
    <font SIZE="2">2,434</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>Goodwill and intangible assets relate to acquisitions located in the United
States. </p>
</font><font FACE="Times New Roman PSMT" SIZE="2">
<p align="right"></font><font SIZE="2">GILDAN QUARTERLY REPORT &#150; Q3 2008 P.38</font></p>
<hr color="#000000" SIZE="5">

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>gilexh992.htm
<DESCRIPTION>EXHIBIT 99.2
<TEXT>
<html>

<head>
<title>Gildan Activewear Inc.: Exhibit 99.2 - 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="568" height="726"></p>
<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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY"><font color="#1060B3">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 and nine months ended July 6, 2008,
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 and nine months
ended July 6, 2008 and the related notes, and with our MD&amp;A (2007 Annual MD&amp;A)
and annual consolidated financial statements for the year ended September 30,
2007, which is part of the fiscal 2007 Annual Report. This MD&amp;A is dated August
12, 2008. All amounts in this report are in U.S. dollars, unless otherwise
noted. </font></p>
<p ALIGN="JUSTIFY"><font color="#1060B3">All financial information contained in
this interim MD&amp;A and in the unaudited 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="#1060B3">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><font color="#1060B3">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 23. </font></p>
<p><font color="#1060B3">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>
<p><font color="#1060B3">The Company's revenues and income are subject to
seasonal variations. Consequently, the results of operations for the third
quarter are traditionally not indicative of the results to be expected for the
full year. </font></p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><font color="#1060B3">OUR BUSINESS </font></font></td>
  </tr>
</table>
<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 $126.8 million, including transaction costs of
$1.5 million on closing, and also placed $10.0 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>Our Products </p>
</b>
<p ALIGN="JUSTIFY">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 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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.2</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Our Manufacturing and Distribution Facilities </p>
</b>
<p><u>Textile and Sock Manufacturing </u></p>
<p ALIGN="JUSTIFY">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 T-shirts, fleece, sport
shirts, underwear and socks. 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. During 2007,
we commenced production at our new integrated sock manufacturing facility and at
our new integrated textile facility for the production of activewear, both in
Rio Nance, Honduras. The expansion of these new facilities is nearing
completion. In August 2007, we announced plans for a second sock facility to
support our projected continuing growth in sales, which is expected to begin
production during the third quarter of fiscal 2009. On May 7, 2008, we announced
plans for a third activewear textile facility in Rio Nance, Honduras to support
our ongoing growth initiatives, where Gildan expects to leverage its existing
infrastructure and manufacturing resources. We currently expect the new facility
to be constructed during fiscal 2008 and 2009 and we expect to begin production
during the first quarter of fiscal 2010. </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. During fiscal 2006, the Dominican Republic facility ramped up production
of basic activewear product-lines and in fiscal 2007 reached a comparable scale
of production to our mature textile facility in Honduras. During the second
quarter of fiscal 2008, the introduction of more complex product-lines and
management turnover at this facility contributed to a shortfall in production
output and cost inefficiencies. During the third quarter of fiscal 2008, we
continued to implement our plan to improve the performance of the facility. </p>
<p ALIGN="JUSTIFY">In addition to our integrated sock manufacturing facility
located in our Central America manufacturing hub, we own and operate a U.S. sock
manufacturing facility in Hillsville, Virginia, and following the Prewett
acquisition, we own and operate sock manufacturing facilities in Fort Payne,
Alabama. </p>
<p><u>Yarn-Spinning </u></p>
<p ALIGN="JUSTIFY">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><u>Sewing </u></p>
<p align="justify">Our vertically-integrated sewing facilities are primarily
located in Central America. In the Caribbean Basin we utilize third-party
contractors, primarily in Haiti, to complement our vertically-integrated sewing
production. </p>
<p><u>Distribution </u></p>
<p ALIGN="JUSTIFY">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 market. </font>
<font FACE="Arial MT" SIZE="3"></p>
</font><font SIZE="2">
<p ALIGN="JUSTIFY">On May 7, 2008, the Company announced its intention to build
a new distribution centre in Honduras. In addition to supporting the Company's
continuing sales growth, the new distribution facility in Honduras will permit
direct shipments to both U.S. and international customers, where appropriate,
and is expected to provide a lower cost structure to handle labour-intensive
activities for mass-market retail customers.<b> </p>
</b></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.3</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Corporate Head Office and Employees </p>
</b>
<p align="justify">Our corporate head office is located in Montreal, Canada and
we currently employ more than 18,000 full-time employees worldwide. </p>
<b>
<p>Market Overview </p>
</b>
<p ALIGN="JUSTIFY">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 our growth for activewear products has been
driven by several industry market trends such as the following: </p>
</font><font FACE="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"></font><font SIZE="2">continued use
  of activewear for event merchandising (such as concerts, festivals, etc.);
  </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">continued evolution
  of the entertainment/sports licensing and merchandising businesses; </font>
  </li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the growing use of
  activewear for uniform applications; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the growing use of
  activewear for corporate promotions; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">continued increase
  in use of activewear products for travel and tourism; </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">an increased
  emphasis on physical fitness; and </font></li>
  <li>
  <p style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.4</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">Strategy and Objectives </font></td>
  </tr>
</table>
<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="Symbol MT" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font 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">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">
  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>Our growth strategy comprises the following five initiatives: </p>
<ol>
  <li>Continue to increase market share in the U.S. wholesale imprinted
  sportswear market in all product categories </li>
  <li>Leverage our successful business model to penetrate the mass-market retail
  channel and develop Gildan as a consumer brand </li>
  <li>Pursue international growth opportunities </li>
  <li>Continue to generate significant manufacturing cost reductions </li>
  <li>Re-invest free cash flow to pursue selective complementary acquisitions.
  </font><font FACE="Courier New PSMT" SIZE="2"></li>
</ol>
</font><font 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, as
subsequently updated in this MD&amp;A and in our first and second quarter 2008 MD&amp;A.
</p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3"><font SIZE="2">Operating Results </font>
    </font></td>
  </tr>
</table>
<b>
<p>Non-GAAP Financial Measures </p>
</b>
<p ALIGN="JUSTIFY">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 19 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.5</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Summary of Quarterly Results </p>
</b>
<p ALIGN="JUSTIFY">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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="30%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2008</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2007</font></td>
    <td WIDTH="9%" align="right" style="border-left-style: solid; border-left-width: 1; border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">2006</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" style="border-bottom: 1px solid #000000"><font SIZE="2"><i>
    (in $ millions, except per share amounts) <sup>(1)</sup></i></font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 3">Q3</b></font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q2</font></td>
    <td WIDTH="8%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q4</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q3</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q2</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q1</font></td>
    <td WIDTH="9%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 3">Q4</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Sales</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">380.8</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">293.8</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">250.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">254.9</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">291.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">232.1</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">185.8</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">235.2</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Net earnings</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">54.0</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">41.7</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">27.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">40.9</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">52.4</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">21.1</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">15.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">16.8</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Net earnings per share</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Basic EPS</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">0.45</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.35</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.23</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.44</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.18</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.13</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Diluted EPS</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">0.44</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.23</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.34</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.43</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.17</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.13</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">0.14</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Total assets</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">1,105.6</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">1 059.5</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">995.4</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">874.5</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">825.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">795.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">715.8</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">723.3</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Total long-term financial liabilities</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">104.7</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">142.2</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">126.2</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">56.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">39.0</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">52.7</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">10.6</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">12.0</font></td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">Average number of shares</font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">&nbsp; outstanding (<i>in thousands)</i></font></td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
    <td WIDTH="9%" align="right">
    <p style="margin-right: 3">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="30%"><font SIZE="2">
    <p style="margin-left: 15">Basic</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 3">120,492</b></font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,464</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,428</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,401</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,359</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,320</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,278</font></td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 3">120,209</font></td>
  </tr>
  <tr>
    <td WIDTH="30%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Diluted</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 3">121,622</b></font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,649</font></td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,656</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,577</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,599</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,529</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,447</font></td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 3">121,340</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><sup>
<p 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>
</font><font 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 </p>
</b>
<p ALIGN="JUSTIFY">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 $126.8 million, including
transaction costs of $1.5 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 $10.0 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 align="justify">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
independent 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.6</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Sales </p>
</b>
<p ALIGN="JUSTIFY">Sales in the third quarter amounted to $380.8 million, up
$89.2 million or 30.6% compared to $291.6 million in the third quarter of fiscal
2007. The increase in sales revenues was due to an increase of $43.8 million in
sock sales due to the acquisition of Prewett in the first quarter of fiscal
2008, an increase of approximately 6% in activewear unit selling prices and a
10.4% increase in unit sales volumes for activewear and underwear. The third
quarter of the 2008 fiscal year also comprised fourteen weeks instead of the
normal thirteen weeks for a fiscal quarter. The inclusion of an extra week is
required in every fifth or sixth fiscal year to maintain the alignment of the
Company's financial reporting cycle with the calendar year. Consistent with our
prior practice, the extra week is included in the third quarter. Growth in activewear unit sales volumes was significantly constrained by a lack of
inventory, as a result of lower than anticipated production from our Dominican
Republic textile manufacturing facility. We made good progress in improving the
performance of the Dominican Republic facility during the third quarter,
although inventory levels for activewear continue to be very low. For the nine
months ended July 6, 2008, sales totalled $925.0 million, up $215.4 million or
30.4% compared to the same period last year. The increase in sales was due to a
$115.6 million increase in sock sales due primarily to the acquisition of
Prewett, a 10.7% increase in unit sales volumes for activewear and underwear,
higher activewear selling prices and a higher valued product-mix for activewear.
</p>
<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, which tracks unit volume shipments from U.S. wholesale
distributors to U.S. screenprinters. The table below summarizes the S.T.A.R.S.
data for the quarter ended June 30, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" style="border-collapse: collapse" bordercolor="#111111" cellpadding="0">
  <tr>
    <td WIDTH="25%">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right"><font SIZE="2"><b>Three months
    ended June 30,</b></font></td>
    <td WIDTH="39%" COLSPAN="2" align="right"><font SIZE="2"><b>Three months
    ended June 30,</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2008 vs 2007</b></font></td>
    <td WIDTH="24%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2008</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>2007</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="38%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Unit Growth&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </b></font></td>
    <td WIDTH="39%" COLSPAN="2" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Market Share&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom: 1px solid #000000">&nbsp;</td>
    <td WIDTH="22%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Industry</b></font></td>
    <td WIDTH="24%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom: 1px solid #000000">
    <font SIZE="2"><b>Gildan</b></font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">All Products</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">5.5%</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(3.5)%</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>51.9%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">47.6%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">T-shirts</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">5.5 %</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">(3.2)%</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>52.6%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">48.3%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%"><font SIZE="2">Fleece</font></td>
    <td WIDTH="22%" align="right"><font SIZE="2">23.4 %</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">0.3 %</font></td>
    <td WIDTH="24%" align="right"><font SIZE="2"><b>51.7%</b></font></td>
    <td WIDTH="14%" align="right"><font SIZE="2">42.2%</font></td>
  </tr>
  <tr>
    <td WIDTH="25%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sport shirts</font></td>
    <td WIDTH="22%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(10.6)%</font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(12.6)%</font></td>
    <td WIDTH="24%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>34.6%</b></font></td>
    <td WIDTH="14%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">34.0%</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The growth in activewear unit sales in the third fiscal
quarter was due to the additional week of shipments and continuing market share
penetration in all product categories in the U.S. wholesale distributor channel.
Although overall industry shipments from U.S. distributors to screenprinters
declined 3.5% during the three months ended June 30, 2008, according to the
S.T.A.R.S. report, distributor demand for Gildan products remained strong. The
Company continued to have a high open order position throughout the quarter,
which has continued into the fourth quarter. Overall inventories in the channel
continue to be in good balance in relation to expected industry demand. </p>
<p ALIGN="JUSTIFY">In the T-shirt category, sales volumes of Gildan T-shirts by
U.S. distributors to screenprinters grew by 5.5% for the quarter ended June 30,
2008, and our leading market share in this category increased to 52.6%. Unit
volume growth of Gildan fleece products from U.S. distributors to screenprinters
totalled 23.4% while growth in the industry was essentially flat. Our leading
market share in this category reached a record high of 51.7%. Our leading brand
position in sport shirts also increased slightly to 34.6%. However, industry
unit shipments were down 12.6% for the quarter, and Gildan sport shirt shipments
within the U.S. distributor channel declined by 10.6% due in part to lack of
product availability as a result of the production capacity constraints from our
Dominican Republic facility. </p>
<p align="justify">Unit shipments to Canada, Europe, Asia/Pacific and Mexico
reflected increases of 6.4% for the third quarter and 4.3% for the first nine
months of fiscal 2008 compared to the same periods in fiscal 2007. Growth in
<font SIZE="2">these markets was constrained due to a lack of product
availability and the delay in the new product introductions as a result of the
shortfall in production from the Dominican Republic facility. </p>
</font></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.7</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">During the third quarter, we began shipment of our first
retail underwear program. We are pleased with consumer demand for our retail
products during the third quarter, and with the improvement in our service
levels to mass retailers. Also, we have continued to implement our strategy to
rationalize our sock product-mix, in order to focus on basic higher-volume
products and programs which capitalize on Gildan's modern large-scale
manufacturing capacity. </p>
<b>
<p>Gross Profit </p>
</b>
<p ALIGN="JUSTIFY">Gross profit of $120.4 million for the third quarter and
$298.9 million for the first nine months of fiscal 2008 increased $26.0 million
and $71.9 million, respectively, compared to the same periods last year. Gross
margins in the third quarter of fiscal 2008 declined slightly to 31.6%, compared
to 32.4% in the third quarter of fiscal 2007. The positive gross margin impact
of higher activewear selling prices and favourable manufacturing efficiencies
arising from the consolidation of textile facilities in the fourth quarter of
fiscal 2007 was more than offset by higher cotton, energy, chemicals and
transportation costs, the impact of production inefficiencies in the Dominican
Republic textile facility, as inventories produced in the second fiscal quarter
were consumed in cost of sales, a lower proportion of high-valued sport shirt
sales, and the impact of the acquisition of Prewett. Socks manufactured by
Gildan in the U.S. have lower gross margins than activewear and sock products
manufactured in the Company's Honduran manufacturing facilities, and therefore
dilute overall gross margins. </p>
<p ALIGN="JUSTIFY">Gross margins for the first nine months of fiscal 2008 were
32.3% compared to gross margins of 32.0% in the same period of fiscal 2007.
Gross margins for the first nine months of fiscal 2008 were positively impacted
by higher activewear selling prices and lower promotional discounts,
manufacturing efficiencies arising from the consolidation of textile facilities
and a higher-valued product-mix. These positive factors were offset by higher
cotton, freight and energy costs, production inefficiencies in the Dominican
Republic facility, the impact of inventory write-downs during fiscal 2008 in
order to accelerate the liquidation of sock product-lines, which have been
discontinued, and the impact of the acquisition of the Prewett acquisition,
which generates lower margins than our activewear business. Additional costs
were also incurred in the second quarter of fiscal 2008 to service mass-market
retailers during the integration of our retail information systems. </p>
<b>
<p>Selling, General and Administrative Expenses </p>
</b>
<p ALIGN="JUSTIFY">Selling, general and administrative (SG&amp;A) expenses in the
third quarter of fiscal 2008 were $43.9 million, or 11.5% of sales, compared to
$28.4 million, or 9.7% of sales, in the third quarter of last year. For the
first nine months of fiscal 2008, SG&amp;A expenses were $113.1 million, or 12.2% of
sales, compared to $83.1 million or 11.7% of sales in the same period last year.
The increase in SG&amp;A expenses was due to the acquisition of Prewett, higher
distribution and transportation expenses, a provision of $2.6 million for
non-collection of accounts receivable from a U.S. retail customer, which filed
for bankruptcy protection during the third quarter, higher corporate
infrastructure costs, including the impact of the higher-valued Canadian dollar,
a charge for the disposal of surplus fixed assets, and professional fees for
special projects. </p>
<b>
<p>Restructuring and Other Charges </p>
</b>
<p ALIGN="JUSTIFY">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 Canadian
corporate office. The costs incurred in connection with these announcements have
been recorded as restructuring and other charges, and include severance and
other 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. Other costs relate primarily to exit costs
incurred in connection with the closures noted above, including carrying and
dismantling costs associated with assets held for sale. During the third quarter
of fiscal 2008, we recorded restructuring charges of $2.3 million consisting
primarily of a $1.7 million impairment loss on property, plant and equipment
resulting from a planned consolidation of our sewing operations in Haiti. For
the first nine months of fiscal 2008, restructuring charges totalled $3.9
million consisting primarily of the $1.7 million impairment loss and other exit
costs of $2.2 million relating to the closures announced in fiscal 2006 and
2007. Additional carrying costs relating to the closed facilities and any gains
or losses on the disposition of the assets held for sale, which we do not expect
to be material, will be accounted for as restructuring charges as incurred. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.8</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">During the third quarter and first nine months of fiscal
2007, we incurred restructuring and other charges of $4.6 million and $22.3
million, respectively, in connection with the closures announced in fiscal 2006
and 2007. The restructuring and other charges in the first nine months of fiscal
2007 included severance costs of $13.3million, an asset impairment loss of
$3.6million relating to the relocation of our corporate head office, accelerated
depreciation of $2.9 million and exit costs of $4.4 million. These costs were
partially offset by a gain of $1.9 million from the sale of some of the assets
related to the above-noted facilities. </p>
<b>
<p>Depreciation and Amortization Expense </p>
</b>
<p ALIGN="JUSTIFY">Depreciation and amortization expense of $15.3 million in the
third quarter and $43.2 million for the first nine months of fiscal 2008,
increased $5.1 million and $14.7 million, respectively, compared to the same
periods in 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 and the impact of the Prewett acquisition,
including the amortization of acquired intangible assets, as well as a charge to
write down surplus fixed assets. </p>
<b>
<p>Interest Expense </p>
</b>
<p ALIGN="JUSTIFY">Net interest expense for the third quarter amounted to $1.2
million, slightly down from $1.5 million for the same period last year, mainly
as a result of declining interest rates during the quarter, despite higher
average debt balances compared to the third quarter of fiscal 2007. For the
first nine months of fiscal 2008, net interest expense of $6.1 million was up
$2.6 million compared to the same period last year mainly due to the increased
utilization of our revolving long-term credit facility to fund the acquisition
of Prewett, effective October 15, 2007, partially offset by the impact of lower
interest rates. </p>
<b>
<p>Income Taxes </p>
</b>
<p ALIGN="JUSTIFY">Income tax expense for the third quarter and the first nine
months of fiscal 2008 was $3.4 million and $9.1 million, respectively, compared
to an income tax recovery of $3.3 million in the third quarter and $0.2 million
in the first nine months of fiscal 2007. During the third quarter of fiscal
2007, we recognized previously unrecorded tax benefits in the amount of $5.7
million relating to a prior taxation year. Excluding the impact of this income
tax recovery, as well as the impact of restructuring and other charges in both
the current year and prior year periods, the effective income tax rate in the
third quarter and the first nine months of fiscal 2008 was 5.8% and 6.7%,
respectively, compared to an effective income tax rate of 4.6% and 4.9% for the
same periods last year. The increase in the effective income tax rate was
primarily due to the higher tax rate attributable to our operations in the U.S.,
which are currently taxed at higher effective income tax rates. </p>
<b>
<p>Net Earnings </p>
</b>
<p ALIGN="JUSTIFY">Net earnings for the third quarter were $54.0 million, or
$0.44 per share, on a diluted basis (EPS) compared to net earnings of $52.4
million, or $0.43 per share, on a diluted basis for the third quarter of fiscal
2007. Net earnings included restructuring and other charges of $2.3 million, or
$0.02 per share in the third quarter of fiscal 2008 and $4.6 million, or $0.04
per share in the third quarter of fiscal 2007. Before reflecting the
restructuring charges in both fiscal years, adjusted net earnings and adjusted
diluted EPS for the third quarter of fiscal 2008 were $56.3 million, or $0.46,
essentially flat compared to adjusted net earnings of $57.0 million and adjusted
diluted EPS of $0.47 in the third quarter of fiscal 2007. Net earnings for the
third quarter last year included an income tax recovery of $5.7 million, or
$0.05 per share from a prior fiscal year. The slight decline in EPS in the third
quarter this year reflected higher activewear selling prices and unit sales
volumes and the inclusion of an additional week of shipments, which were more
than offset by higher cotton, energy and transportation costs, unfavourable
product-mix, higher SG&amp;A and depreciation expenses, the non-recurrence of a
prior year income tax recovery which positively impacted EPS by $0.05 in the
third quarter of last year, a provision for a doubtful receivable account, and
charges to write-off or dispose of surplus fixed assets. </p>
<p ALIGN="JUSTIFY">The Company's results for its third fiscal quarter were in
line with its most recent EPS guidance. More favourable than projected activewear selling prices, unit volumes and product-mix were offset by a
provision for a doubtful receivable account, and charges to write off or dispose
of surplus fixed assets. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.9</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">For the first nine months of fiscal 2008, net earnings
amounted to $123.2 million, or $1.01 per share on a diluted basis, compared to
net earnings of $89.2 million, or $0.73 per share, for the same period in fiscal
2007. Before the impact of restructuring and other charges, adjusted net
earnings in the first nine months of fiscal 2008 amounted to $127.1 million, or
$1.04 per share on a diluted basis, up respectively 14.0% and 13.0% compared to
adjusted net earnings of $111.5 million or $0.92 per share on a diluted basis
for the same period last year. The increase in adjusted net earnings and
adjusted diluted EPS in fiscal 2008 was primarily due to growth in unit sales
volumes for activewear and underwear, higher activewear selling prices,
favourable activewear product-mix and further manufacturing efficiencies for
activewear. These positive factors were partially offset by increases in cotton,
energy, chemicals and transportation costs, production inefficiencies in the
Dominican Republic facility, higher SG&amp;A, depreciation and interest expenses,
the nonrecurrence of the income tax recovery in the third quarter of fiscal 2007
and the impact of a higher effective income tax rate. Net earnings and diluted
EPS for the first nine months of fiscal 2008 were also negatively impacted by
additional costs to service mass-market retailers in the second quarter during
the integration of our retail information systems, a write-down of inventories
of discontinued sock product-lines in the second quarter, a provision for
non-collection of a receivable account from a U.S. retail customer in the third
quarter, and charges in the third quarter for the write-down or disposal of
surplus fixed assets. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">Financial Condition </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Accounts receivable increased to $254.5 million in the third
quarter of fiscal 2008 from $206.1 million at September 30, 2007 and increased
by $71.0 million compared to the third quarter of the prior year. The increase
in accounts receivable from the end of fiscal 2007 reflected an increase in
activewear sales and the inclusion of accounts receivable from the Prewett
acquisition, partially offset by a decline in days sales outstanding. Typically,
our days sales outstanding are higher in the second half of the year and highest
in the fourth quarter, as a result of seasonal programs for fleece and
long-sleeved T-shirts invoiced with extended payment terms in the spring and
summer months, in line with industry practice. The increase in accounts
receivable compared to the third quarter of fiscal 2007 was mainly due to the
increase in activewear sales in the third quarter over the prior year, the
inclusion of accounts receivable from the acquisition of Prewett and an increase
in days sales outstanding due to a higher proportion of fleece sales which
reflect extended payment terms as noted above. </p>
<p ALIGN="JUSTIFY">Inventories of $290.8 million were up $50.9 million, or 21.2%
from September 30, 2007 and up $59.3 million, or 25.6% compared to the third
quarter of fiscal 2007. The increase in inventories compared to both periods
reflected the inclusion of inventories from the Prewett acquisition. Excluding
the impact of the Prewett acquisition, inventories were essentially flat
compared to September 30, 2007. Increases in unit costs resulting from higher
costs of cotton, freight and energy were offset by lower inventory volume levels
due to the production capacity constraints resulting from the manufacturing
issues in the Dominican Republic facility. </p>
<p ALIGN="JUSTIFY">Property, plant and equipment, which are net of accumulated
depreciation and asset impairment losses, amounted to $426.8 million at the end
of the third quarter of fiscal 2008, up $49.2 million from September 30, 2007.
This increase was primarily due to the inclusion of $20.2 million of property,
plant and equipment from the acquisition of Prewett, net capital expenditures of
$79.8 million, mainly for the capacity expansion projects in Honduras, partially
offset by depreciation of $38.7 million, an impairment loss on property, plant
and equipment of $1.7 million primarily related to the planned consolidation of
our sewing operations in Haiti and a reclassification of property, plant and
equipment to assets held for sale of $6.9 million mainly related to the land and
building of our former corporate head office. </p>
<p ALIGN="JUSTIFY">Other assets at the end of the third quarter of fiscal 2008
amounted to $18.2 million, up from $11.4 million at September 30, 2007. The
increase reflected $10.0 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.10</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">Goodwill and identifiable intangible assets of $63.9 million
as at July 6, 2008 primarily related to the acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Total assets were $1,105.6 million at July 6, 2008, compared
to $874.5 million at September 30, 2007 and $825.0 million at the end of the
third quarter of fiscal 2007. Working capital was $411.1 million at the end of
the third quarter of fiscal 2008 compared to $342.5 million at September 30,
2007 and $307.1 million at July 1, 2007. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify">Cash Flows and Liquidity and Capital Resources </font>
    </td>
  </tr>
</table>
<b>
<p align="justify">Cash Flows </p>
</b>
<p ALIGN="JUSTIFY">Cash flows from operating activities in the third quarter of
fiscal 2008 were $40.7 million, compared to $32.3 million for the previous year.
The increase in cash inflow was mainly due to higher cash operating earnings and
increases in accounts payable and accrued liabilities which reflected higher
balances primarily related to yarn purchases as a result of increases in cotton
costs and production volumes. This was partially offset by a higher seasonal
increase in accounts receivable due to a higher proportion of fleece sales,
which are invoiced with extended payment terms, and a lower increase in
inventories due to the production issues at the Dominican Republic facility. For
the first nine months of fiscal 2008, cash flows from operating activities were
$168.4 million compared to cash flows from operating activities of $72.1 million
in the same period last year mainly as a result of higher cash operating
earnings and a higher seasonal decrease in accounts receivable and a lower
seasonal increase in inventories. </p>
<p ALIGN="JUSTIFY">Cash flows used in investing activities were $19.2 million in
the third quarter of fiscal 2008 down from $29.2 million in the third quarter of
fiscal 2007 mainly as a result of lower capital expenditures in fiscal 2008. The
decrease in capital expenditures in the quarter primarily reflected lower
spending requirements in fiscal 2008 for our major textile and sock capacity
expansion projects in Honduras. For the first nine months of fiscal 2008, cash
flows used in investing activities amounted to $213.0 million compared to $103.7
million for the same period last year. This increase was mainly attributable to
the acquisition of Prewett, for a purchase price of $126.8 million, partially
offset by lower capital expenditures during the first nine months of fiscal
2008, mainly as a result of lower spending requirements for our Honduran
capacity expansion projects compared to last year. </p>
<p ALIGN="JUSTIFY">Free cash flow grew to $92.2 million for the first nine
months of fiscal 2008 compared to negative free cash flow of $31.6 million in
the same period last year, primarily attributable to higher cash flow from
operations and lower capital expenditures. </p>
<p ALIGN="JUSTIFY">Cash flows used in financing activities in the third quarter
of fiscal 2008 of $37.5 million mainly reflected higher reductions on our long
term credit facility used primarily to finance the acquisition of Prewett,
compared to the same period last year. Cash flows used in financing activities
in the third quarter last year of $31.1 million reflected reductions on our
long-term credit facility and the final $17.5 million repayment of the Company's
Senior Notes. For the first nine months ended fiscal 2008 cash flows from
financing activities were $48.5 million compared to $10.0 million for the first
nine months of fiscal 2007. The increase reflected a higher amount of funds
drawn under our revolving long-term credit facility in order to finance the
acquisition of Prewett. </p>
<p ALIGN="JUSTIFY">Cash and cash equivalents amounted to $13.2 million as at
July 6, 2008 compared to $7.5 million at the end of the third quarter last year
and $9.3 million at September 30, 2007. Total indebtedness at July 6, 2008
amounted to $108.4 million compared to $59.7 million at September 30, 2007 and
$42.9 million at July 1, 2007. The 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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.11</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Liquidity and Capital Resources </p>
</b>
<p ALIGN="JUSTIFY">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 and business acquisitions. 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 $126.8 million on closing of the
Prewett acquisition and also placed $10.0 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 is subject to a
one-year extension on an annual basis, to $400 million. This facility, which
expires on June 28, 2013, is on an unsecured basis. As at the end of the third
quarter of fiscal 2008 we had $100 million drawn on our revolving credit
facility compared to $30.0 million drawn on our revolving credit facility at the
end of the third quarter of fiscal 2007. We believe our cash flow from operating
activities together with our credit facilities will provide us with sufficient
liquidity and capital resources to fund our anticipated working capital and
capital expenditure requirements for the foreseeable future. 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 now projecting capital expenditures of
approximately $115 million, compared to our previous projection of $130 million.
The reduction in the projected capital expenditures for fiscal 2008 is primarily
due to timing delays related to the land filling in Honduras to prepare sites
for capacity expansion projects as well as sewing capacity expansion. Capital
investments for fiscal 2008 primarily include the projected expenditures to
complete the ramp-up of the activewear and sock facilities in Honduras, a
chemical cost reduction project, which we announced in May 2007, investments in
our information technology systems and a second sock facility expected to be
completed in fiscal 2009. On May 7, 2008, we announced our intentions to
construct a third large-scale, vertically-integrated textile facility in
Honduras, where Gildan expects to leverage its existing infrastructure and
manufacturing management resources. Capital expenditures for fiscal 2009 are
projected to be $160 million and are expected to include expenditures for our
second sock facility and third activewear textile facility in Honduras, as well
as investments in sewing capacity expansion and information technology systems
to support our growth. </p>
<p ALIGN="JUSTIFY">In order to maintain or adjust its capital structure, the
Company, upon approval from its Board of Directors, may issue or repay long-term
debt, issue shares, repurchase shares, pay dividends or undertake other
activities as deemed appropriate under the specific circumstances. We do not
currently pay a dividend. However, the Company's Board of Directors periodically
evaluates the merits of introducing a dividend. </p>
<b>
<p>Off-Balance Sheet Arrangements </p>
</b>
<p ALIGN="JUSTIFY">We do not have any 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 unaudited 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 certain of its
subsidiaries do not perform their contractual obligations. As at July 6, 2008,
the maximum potential liability under these guarantees was $17.4 million, of
which $5.2 million was for surety bonds and $12.2 million was for corporate
guarantees and standby letters of credit. </p>
<b>
<p>Contractual Obligations </p>
</b>
<p ALIGN="JUSTIFY">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, excluding future
interest payments, for the following items as at July 6, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.12</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="36%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Payments due by period</font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>Less than</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>1 to 3</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>4 to 5</b></font></td>
    <td WIDTH="13%" align="right"><font SIZE="2"><b>After</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" 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>Total</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>1 year</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">108.4</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">1.2</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">7.2</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Operating leases</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">48.4</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">1.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">22.0</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">9.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">15.2</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font SIZE="2">Purchase obligations</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">95.2</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">90.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">4.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other obligations</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">61.3</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">49.6</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">11.7</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font 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">
    <font SIZE="2"><b>313.3</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>143.0</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>45.8</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>109.3</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>15.2</b></font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">We expect that cash flows from operations, together with our
cash balances and unutilized bank facilities, will be sufficient to meet cash
needs for the foreseeable future. </p>
<b>
<p align="justify">Outstanding Share Data </p>
</b>
<p align="justify">Our common shares are listed on the New York Stock Exchange
and the Toronto Stock Exchange (GIL). </p>
<p align="justify">As at July 31, 2008, there were 120,525,039 common shares
issued and outstanding along with 884,071 stock options and 906,800 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">Recent Developments in Legal Proceedings </p>
</b>
<p align="justify">During the quarter, a number of proposed securities class
action lawsuits were filed against the Company alleging, among other things,
that the Company misrepresented its financial prospects in its financial
guidance concerning the 2008 fiscal year. See &quot;Update to the Description of
Risks and Uncertainties - Securities Class Actions&quot;. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Financial Risk Management </font></font>
    </td>
  </tr>
</table>
<p align="justify">This section of the 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 unaudited 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 into, and are an integral part of, the unaudited interim
consolidated financial statements. </p>
<b>
<p align="justify">Credit risk </p>
</b>
<p align="justify">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 carrying
amount of financial assets, as disclosed in Note 10(a) to the interim
consolidated financial statements, represents the Company's credit exposure at
the reporting date, including trade receivables. The Company's trade receivables
and credit exposure fluctuate throughout the year. The Company's average trade
receivables and credit exposure during an interim reporting period may be higher
than the balance at the end of that reporting period. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.13</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<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 July 6, 2008, the
Company's twenty largest trade debtors accounted for 79.3% of trade accounts
receivable, of which one wholesale customer accounted for 18.3% and one retailer
accounted for 8.4%. Of the Company's top twenty trade debtors, seventeen are
wholesale distributors, and seventeen 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 to wholesale distributors
of certain seasonal products, primarily in the second half of the fiscal year,
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 five years, and credit losses
have not been material 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 financial leverage of certain of our wholesale distributor
customers may limit or prevent their ability to obtain future financing, and
could affect their ability to comply with restrictive debt covenants and meet
other obligations. The profile and credit quality of the Company's retail
customers varies significantly. Adverse changes in a customer's financial
position could cause us to limit or discontinue business with that customer,
require us to assume more credit risk relating to that customer's future
purchases or result in uncollectible accounts receivable from that customer.
Such changes could have a material adverse effect on our business, results of
operations, financial condition and cash flows. </p>
<p align="justify">The Company's extension of credit to customers involves
considerable judgment and is based on an evaluation of each customer's financial
condition and payment history. 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. </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>
<p align="justify">The Company's exposure to credit risk for trade receivables
by geographic area and type of customer as at July 6, 2008 was as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.14</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></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%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">United States</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">206.2</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Europe</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">14.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Canada</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">13.4</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Other regions</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">2.7</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">236.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="50%">&nbsp;</td>
    <td WIDTH="50%" align="right">&nbsp;</td>
  </tr>
  <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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Distributors and screenprinters</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">189.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Mass-market and regional retailers</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">47.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">236.9</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The aging of trade receivable balances as at July 6, 2008 was as follows: </p>
</font>
<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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Not past due</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">221.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Past due 0-30 days</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">12.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Past due 31-120 days</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">5.8</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="2">Past due 121-180 days</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1"><font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1"><font SIZE="2">Trade receivables</font></td>
    <td WIDTH="50%" align="right" style="border-top-style: solid; border-top-width: 1"><font SIZE="2">
    <p style="margin-right: 4">240.9</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Less allowance for doubtful accounts</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="50%" 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">236.9</font></td>
  </tr>
</table>
<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>
<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">
    <font SIZE="2">July 6, 2008</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%"><font SIZE="2">Balance as at September 30, 2007</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">
    <p style="margin-right: 4">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">
    <p style="margin-right: 4">2.5</font></td>
  </tr>
  <tr>
    <td WIDTH="50%"><font SIZE="2">Write-off of accounts receivable</font></td>
    <td WIDTH="50%" align="right"><font SIZE="2">(0.8)</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Increase due to acquisition</font></td>
    <td WIDTH="50%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.3</font></td>
  </tr>
  <tr>
    <td WIDTH="50%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Balance as at July 6, 2008</font></td>
    <td WIDTH="50%" 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">4.0</font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Liquidity Risk </p>
</b>
<p ALIGN="JUSTIFY">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 unaudited interim 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 business
acquisitions. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.15</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">The Company has a committed revolving credit facility for a
maximum of $400 million which expires on June 28, 2013 and which is subject to a
one-year extension on an annual basis. This facility is unsecured and amounts
drawn bear interest at LIBOR rates or U.S. base rate plus a margin. As at July
6, 2008, $100 million was drawn under this facility, bearing an effective
interest rate of 3.5%, 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>
<p align="justify">The following are the contractual maturities of financial
liabilities, excluding derivative financial instruments and future interest
payments but including interest accrued to July 6, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="36%"><font size="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="12%" align="right"><font size="2"><b>Carrying</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>0 to 12</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>1 to 2</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>2 to 5</b></font></td>
    <td WIDTH="13%" align="right"><font size="2"><b>More than</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" 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>amount</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>months</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>years</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2"><b>5 years</b></font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1">
    <font size="2">Long-term credit facility</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">100.0</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%"><font size="2">Other long-term debt</font></td>
    <td WIDTH="12%" align="right"><font size="2">8.4</font></td>
    <td WIDTH="13%" align="right"><font size="2">3.8</font></td>
    <td WIDTH="13%" align="right"><font size="2">4.6</font></td>
    <td WIDTH="13%" align="right"><font size="2">-</font></td>
    <td WIDTH="13%" align="right"><font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">147.4</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">147.4</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="36%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>Total</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">
    <font size="2"><b>255.8</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>151.2</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>4.6</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>100.0</b></font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2"><b>-</b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's only derivative financial liabilities as at
July 6, 2008 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
listed on page 17. </p>
<b>
<p>Foreign Currency Risk </p>
</b>
<p ALIGN="JUSTIFY">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 corporate 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 or 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 nine months ended July 6,
2008, 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. </font><font FACE="Times New Roman PS" SIZE="1"><b></p>
</b></font><font SIZE="2"></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.16</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></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 align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in US$ millions)</i></font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>July 6, 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" 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>CAD</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Cash and cash equivalents</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">2.1</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Accounts receivable</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">16.6</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">5.9</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">5.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">(15.7)</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">(2.9)</font></td>
    <td WIDTH="10%" 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">
    <font SIZE="2">Future income taxes and income taxes payable</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(26.0)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(1.0)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Balance sheet exposure excluding financial derivatives</font></td>
    <td align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(23.6)</font></td>
    <td 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">4.1</font></td>
    <td 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">7.5</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 align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
    <td align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td COLSPAN="3" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>For the nine months ended</b></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"><i>(in US $ millions)</i></font></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">&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>July 6, 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" 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>CAD</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Sales</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">41.1</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">24.8</font></td>
    <td align="right"><font SIZE="2">
    <p style="margin-right: 4">16.8</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Operating expenses</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(38.6)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(7.2)</font></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(2.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net exposure</font></td>
    <td 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">2.5</font></td>
    <td 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">17.6</font></td>
    <td 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">14.8</font></td>
  </tr>
</table>
<font 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 significantly 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 July 6, 2008 and September 30,
2007: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="23%"><font SIZE="2"><i>(in $ millions)</i></font></td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right"><font SIZE="2"><b><u>Carrying and
    Fair Value</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>currency</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>July 6, 2008</b></font></td>
    <td WIDTH="15%" align="center" 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>amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>rate</b></font></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="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="center" 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">&nbsp;</td>
    <td WIDTH="12%" 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">&nbsp;</td>
    <td WIDTH="13%" 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">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">35.5</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">0.9923</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">35.2</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">8.5</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3963</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">11.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(1.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">2.7</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.4743</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">3.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="15%" align="center" 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">5.2</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">1.9952</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">10.3</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">0.1</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</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">61.3</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.1</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(2.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>National</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>foreign</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Average</b></font></td>
    <td WIDTH="12%" align="right">&nbsp;</td>
    <td WIDTH="27%" COLSPAN="2" align="right"><font SIZE="2"><b><u>Carrying and
    Fair Value</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&nbsp;</td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>currency</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>exchange</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>Notional US</b></font></td>
    <td WIDTH="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>September 30, 2007</b></font></td>
    <td WIDTH="15%" align="center" 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>amount</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>rate</b></font></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="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Asset</b></font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Liability</b></font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="center" 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">&nbsp;</td>
    <td WIDTH="12%" 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">&nbsp;</td>
    <td WIDTH="13%" 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">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Buy EUR/Sell USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.4</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3616</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.0</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">0.3</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.9</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3626</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.7</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.3)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">9.1</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.3677</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">12.4</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%"><font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="15%" align="center"><font SIZE="2">0-6 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">4.8</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.9988</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">9.6</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.1)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center"><font SIZE="2">6-12 months</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">6.0</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">1.9841</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">11.9</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="23%">&nbsp;</td>
    <td WIDTH="15%" align="center">&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="13%" align="right">&nbsp;</td>
    <td WIDTH="13%" align="right">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell CAD/Buy USD</font></td>
    <td WIDTH="15%" align="center" 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">3.8</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="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">3.8</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">-</font></td>
  </tr>
  <tr>
    <td WIDTH="23%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="center" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</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">50.4</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">0.3</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(1.1)</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>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.17</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p>The following exchange rates applied during the reporting period for the nine
months ended July 6, 2008: </p>
</font>
<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 SIZE="2">Year to date</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">Reporting date</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" align="right"><font SIZE="2">average rate</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">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 SIZE="2"><b>Q3 2008</b></font></td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>Q3 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">CAD to USD</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.0039</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">0.9826</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">EUR to USD</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.4944</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">1.5703</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom: 2px solid #000000"><font SIZE="2">GBP
    to USD</font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">2.0035</font></td>
    <td WIDTH="15%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">1.9831</font></td>
  </tr>
</table>
<font FACE="Arial MT" SIZE="2">
<p ALIGN="JUSTIFY">Based on the Company's foreign currency exposures noted above
and the forward foreign exchange contracts in effect during the nine months
ended July 6, 2008, 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="70%"><font SIZE="2"><i>(in US$ 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>
  </tr>
  <tr>
    <td WIDTH="70%">&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="70%">&nbsp;</td>
    <td WIDTH="10%" COLSPAN="3" align="right"><font SIZE="2"><b><u>For the nine
    months ended July 6, 2008</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Source of net earnings variability from changes in foreign
    exchange rates</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>CAD</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>EUR</b></font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>GBP</b></font></td>
  </tr>
  <tr>
    <td WIDTH="70%" 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="70%"><font SIZE="2">Financial instruments, including forward
    foreign exchange contracts</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">(1.8)</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.2</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Future income tax liability and income taxes
    payable</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.3</font></td>
    <td WIDTH="10%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.1</font></td>
    <td WIDTH="10%" 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">
    <font SIZE="2">Sales and operating expenses</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.1)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.9)</font></td>
    <td WIDTH="10%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font 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: 2">
    <font SIZE="2">Decrease in net earnings</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">(0.6)</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">(0.2)</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">(0.5)</font></td>
  </tr>
</table>
<font SIZE="2">
<p align="justify">An assumed 5 percent weakening of the U.S. dollar during the
nine months ended July 6, 2008 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 </p>
</b>
<p align="justify">The Company's interest rate risk is primarily related to the
Company's revolving long-term credit facility, for which amounts drawn are
primarily 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 nine months ended July 6, 2008, an assumed 0.5 percentage point
increase in interest rates during such period would have decreased net earnings
by $0.6 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%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Outlook </font></font></td>
  </tr>
</table>
<p align="justify">A discussion of management's expectations as to the Company's
outlook for fiscal 2008 and fiscal 2009 is contained in the Company's third
quarter earnings results press release dated August 13, 2008 under the section
entitled &quot;Outlook&quot;. The press release is available on the SEDAR website at
www.sedar.com, on the EDGAR website at www.sec.gov and on the Company's website
at www.gildan.com. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.18</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: none; border-bottom-width: medium">&nbsp;</td>
  </tr>
  <tr>
    <td width="100%" style="border-top-style: none; border-top-width: medium; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Critical Accounting Estimates </font>
    </font></td>
  </tr>
</table>
<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>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Sales promotional programs; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Trade accounts receivable; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Property, plant and equipment; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Cotton and yarn procurements; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Income taxes; and </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Adoption of New Accounting Standards&nbsp;
    </font></font></td>
  </tr>
</table>
<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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Internal Control Over Financial Reporting&nbsp;&nbsp;
    </font></font></td>
  </tr>
</table>
<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>
<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>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Reconciliation and Definition of Non-GAAP
    Measures </font></font></td>
  </tr>
</table>
<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>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.19</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>Adjusted Net Earnings and Adjusted Diluted EPS </p>
</b>
<p ALIGN="JUSTIFY">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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amounts)</i></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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Q3 2008</b></font></td>
    <td WIDTH="11%" align="right" style="border-left-style: solid; border-left-width: 1; 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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">YTD 2008</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" 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="11%" 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="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
    <td WIDTH="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Reported</b></font></td>
    <td WIDTH="11%" 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="11%" 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: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">Adjusted</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">380.8</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">380.8</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">925.0</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">925.0</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">260.4</b></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"><b>
    <p style="margin-right: 4">260.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">626.1</b></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"><b>
    <p style="margin-right: 4">626.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">120.4</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">120.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">298.9</b></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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">298.9</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Selling, general and administrative</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="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="34%"><font SIZE="2">&nbsp;&nbsp; expenses</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.9</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.9</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">113.1</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">113.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(2.3)</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(3.9)</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" 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"><b>
    <p style="margin-right: 4">74.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">76.5</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">181.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">185.8</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
    <td WIDTH="11%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Non-controlling interest of</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="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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.2</b></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"><b>
    <p style="margin-right: 4">0.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.4</b></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"><b>
    <p style="margin-right: 4">0.4</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">57.5</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">59.8</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">132.2</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">136.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.4</b></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"><b>
    <p style="margin-right: 4">3.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">9.1</b></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"><b>
    <p style="margin-right: 4">9.1</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">54.1</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">56.4</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">123.1</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>
    <p style="margin-right: 4">127.0</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.45</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.02</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.47</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.02</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">0.03</b></font></td>
    <td WIDTH="11%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.06</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom: 2px solid #000000"><font SIZE="2">
    Diluted E.P.S.</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.44</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.02</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.46</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">1.01</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.03</b></font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2"><b>
    <p style="margin-right: 4">1.04</b></font></td>
  </tr>
  <tr>
    <td WIDTH="34%">&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>
    <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="34%">&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>
    <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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><i>(in $ millions, except per share amount)</i></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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Q3 2007</font></td>
    <td WIDTH="11%" align="right" style="border-left-style: solid; border-left-width: 1; 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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="11%" align="right" style="border-right-style: solid; border-right-width: 1; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="11%" 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="11%" 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="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
    <td WIDTH="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Reported</font></td>
    <td WIDTH="11%" 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="11%" 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: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Adjusted</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Sales</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">291.6</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">291.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">709.6</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">709.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cost of sales</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">197.2</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">197.2</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">482.6</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">482.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Gross profit</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">94.4</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">94.4</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">227.0</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="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">227.0</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Selling, general and administrative</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="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="34%"><font SIZE="2">&nbsp;&nbsp; expenses</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">28.4</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">28.4</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">83.1</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">83.1</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4.6)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(22.3)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" 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">
    <p style="margin-right: 4">61.4</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">66.0</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">121.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">143.9</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10.3</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">10.3</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">28.5</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">28.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</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">1.5</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">3.5</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">3.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Non-controlling interest of</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="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="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</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">0.5</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.6</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">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Earnings before income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">49.1</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">53.7</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89.0</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
    <td WIDTH="11%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">111.3</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Income taxes</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(3.3)</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">(3.3)</font></td>
    <td WIDTH="11%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(0.2)</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">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="11%" 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">52.4</font></td>
    <td WIDTH="11%" 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">4.6</font></td>
    <td WIDTH="11%" 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">57.0</font></td>
    <td WIDTH="11%" 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">89.2</font></td>
    <td WIDTH="11%" 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">22.3</font></td>
    <td WIDTH="11%" 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">111.5</font></td>
  </tr>
  <tr>
    <td WIDTH="34%"><font SIZE="2">Basic E.P.S.</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.44</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.48</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.74</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.18</font></td>
    <td WIDTH="11%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.92</font></td>
  </tr>
  <tr>
    <td WIDTH="34%" style="border-bottom: 2px solid #000000"><font SIZE="2">
    Diluted E.P.S.</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.43</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.47</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.73</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.18</font></td>
    <td WIDTH="11%" align="right" style="border-bottom: 2px solid #000000">
    <font SIZE="2">
    <p style="margin-right: 4">0.92</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary.</i> <i>EPS amounts may not add due to rounding. <sup><br>
(1)</sup>Adjustment to remove restructuring and other charges. See page 8. </p>
</i></font><font SIZE="2"></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.20</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>EBITDA </p>
</b>
<p ALIGN="JUSTIFY">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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="52%"><font SIZE="2"><i>(in $ millions)</i></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>
  </tr>
  <tr>
    <td WIDTH="52%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>YTD 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Net earnings</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">54.0</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">52.4</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">123.2</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">89.2</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Restructuring and other charges <sup>(1)</sup></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">2.3</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">4.6</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">3.9</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">22.3</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Depreciation and amortization</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">15.3</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10.3</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">43.2</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">28.5</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Interest, net</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">1.2</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.5</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">6.1</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">3.5</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Income tax expense (recovery)</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">3.4</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(3.3)</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">9.1</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(0.2)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Non-controlling interest of</font></td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" 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="52%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">&nbsp;&nbsp; consolidated joint venture</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.2</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.5</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">0.4</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0.6</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">EBITDA</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"><b>
    <p style="margin-right: 4">76.4</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">
    <font SIZE="2">
    <p style="margin-right: 4">66.0</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"><b>
    <p style="margin-right: 4">185.9</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">
    <font SIZE="2">
    <p style="margin-right: 4">143.9</font></td>
  </tr>
</table>
<i><font style="font-size: 9pt">
<p>Certain minor rounding variances exist between the financial statements and
this summary. <sup><br>
(1)</sup> See page 8. </p>
</font></i><font SIZE="2"><b>
<p>Free Cash Flow </p>
</b>
<p ALIGN="JUSTIFY">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="52%"><font SIZE="2"><i>(in $ millions)</i></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>
  </tr>
  <tr>
    <td WIDTH="52%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>YTD 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">YTD 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Cash flows from operating activities</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">40.7</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">32.3</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">168.4</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">72.1</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Cash flows from investing activities</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>(19.2)</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(29.2)</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>(213.0)</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(103.7)</font></td>
  </tr>
  <tr>
    <td WIDTH="52%"><font SIZE="2">Add back:</font></td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" 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="52%"><font SIZE="2">
    <p style="margin-left: 15">Acquisition of Prewett</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>
    <p style="margin-right: 4">126.8</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 15">Restricted cash related to acquisition</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="12%" align="right" style="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-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">10.0</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
  </tr>
  <tr>
    <td WIDTH="52%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>Free cash flow</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">
    <font SIZE="2"><b>
    <p style="margin-right: 4">21.5</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">
    <font SIZE="2">
    <p style="margin-right: 4">3.1</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"><b>
    <p style="margin-right: 4">92.2</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">
    <font SIZE="2">(31.6)</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i></font><font SIZE="2"><b>
<p>Total Indebtedness and Cash in Excess of Debt (Net Indebtedness) </p>
</b>
<p>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="64%"><font SIZE="2"><i>(in $ millions)</i></font></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="64%" 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>Q3 2008</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q4 2007</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Q3 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">Bank indebtedness</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">-</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-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">
    <font SIZE="2">(3.5)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%"><font SIZE="2">Current portion of long-term debt</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2"><b>(3.8)</b></font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(3.7)</font></td>
    <td WIDTH="12%" align="right"><font SIZE="2">(3.9)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Long-term debt</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>(104.7)</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(56.0)</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(39.0)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>Total indebtedness</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2"><b>(108.5)</b></font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(59.7)</font></td>
    <td WIDTH="12%" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">(46.4)</font></td>
  </tr>
  <tr>
    <td WIDTH="64%">&nbsp;</td>
    <td WIDTH="12%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="12%" 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="64%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Cash and cash equivalents</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2"><b>
    <p style="margin-right: 4">13.2</b></font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">9.3</font></td>
    <td WIDTH="12%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">7.5</font></td>
  </tr>
  <tr>
    <td WIDTH="64%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2"><b>(Net indebtedness) Cash in excess of debt</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">
    <font SIZE="2"><b>(95.3)</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">
    <font SIZE="2">(50.4)</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">(38.9)</font></td>
  </tr>
</table>
<font style="font-size: 9pt"><i>
<p>Certain minor rounding variances exist between the financial statements and
this summary. </p>
</i></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.21</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<div style="border-bottom-style: solid; border-bottom-width: 1; padding-bottom: 1">
<p align="justify" style="margin-bottom: 0"><font color="#1060B3">Risks and Uncertainties
</font> </p>
</div>
<p ALIGN="JUSTIFY">The Company is subject to a variety of business risks. The
risks below 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>
<p align="justify">The risks described in our 2007 Annual MD&amp;A, as subsequently
updated in our first and second quarter 2008 MD&amp;A, included discussions relating
to the following important factors: </p>
</font><font FACE="Wingdings" LANG="JA" SIZE="2">
<ul>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Our ability to implement our strategies and plans; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is competitive; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is subject to pricing pressures; </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">Our success depends on our ability to anticipate evolving
  consumer preferences and trends; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  operations are subject to environmental regulation; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  rely on a relatively small number of significant customers; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  customers do not commit to purchase minimum quantities; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are exposed to concentrations of credit risk; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are subject to international trade regulation </li>
  </font><font FACE="Wingdings" LANG="JA" SIZE="2">
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font SIZE="2">We currently pay income tax at a comparatively low effective
  rate, which could change in the future (see &quot;Updates to the Description of
  Risks and Uncertainties&quot; below); </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">The
  price of the raw materials we buy is prone to significant fluctuations and
  volatility; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  operations are subject to political, social and economic risks; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  industry is subject to fluctuations in sales demand; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">Our
  business operations significantly rely on our information systems; </font>
  </li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  are subject to foreign currency risk; </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">We
  depend on key management; and </font></li>
  <li>
  <p ALIGN="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  Securities class actions (see &quot;Updates to the Description of Risks and
  Uncertainties&quot; below) </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 as well as our first and second
quarter interim reports similarly filed. </p>
<b>
<p align="justify">Updates to the Description of Risks and Uncertainties </p>
</b>
<p ALIGN="JUSTIFY">The following are significant updates to the description of
risks contained in the section entitled &quot;Risks and Uncertainties&quot; of the Gildan
2007 MD&amp;A, as subsequently updated in our first and second quarter 2008 MD&amp;A.
</p>
<p align="justify"><u>We currently pay income tax at a comparatively low
effective rate, which could change in the future </u></p>
<p ALIGN="JUSTIFY">The Company benefits from a low overall effective corporate
tax rate due to the majority of its global sales, marketing, and manufacturing
operations being carried out in low tax rate jurisdictions in Central America
and the Caribbean Basin. The Company's income tax filings and income tax
provisions reflect tax positions that are based on interpretations of applicable
tax laws, including income tax treaties between various countries in which the
Company operates as well as underlying rules and regulations with respect to
transfer pricing. These interpretations involve judgments and estimates and may
be challenged through government taxation audits that the Company is regularly
subject to. As disclosed in Note 12 to our interim consolidated financial
statements, the Canada Revenue Agency (CRA) is currently conducting an audit of
Gildan's income tax returns for its 2000, 2001, 2002 and 2003 fiscal years, the
scope of which includes a review of transfer pricing and the allocation of
income between the Company's Canadian legal entity and its foreign subsidiaries.
The Company believes its tax filing positions are sustainable based on the
economic substance of its legal and operating structure and the merits of its
transfer pricing methodology as supported by annual transfer pricing studies
conducted by external experts. However, we cannot predict with certainty the
outcome of any audit undertaken by taxation authorities and the final result may
vary compared to the estimates and assumptions used by management in determining
the Company's consolidated income tax provision and in valuing its income tax
assets and liabilities. Depending on the ultimate outcome of any such audit,
there may be a material adverse impact on the Company's financial position,
results of operations and cash flows. In addition, if the Company were to
receive a tax reassessment by a taxation authority prior to the ultimate
resolution of an audit, the Company could be required to submit an advance
deposit on the amount reassessed. </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.22</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The Company's overall effective income tax rate may also be
adversely affected by the following: unanticipated changes to current domestic
laws in the countries in which the Company operates; changes to the income tax
treaties the Company currently relies on; changes in the location of the
Company's operations that would result in a higher proportion of taxable income
being reported in higher tax rate jurisdictions; an increase in income tax
rates; and, changes to free trade and export processing zone rules in certain
countries where the Company is not subject to income tax. </p>
<p><u>Securities class actions </u></p>
<p ALIGN="JUSTIFY">The Company and certain of its senior officers have been
named as defendants in a number of proposed class action lawsuits filed in the
United States District Court for the Southern District of New York. These U.S.
lawsuits will likely be consolidated into one proposed class action with a lead
plaintiff. A proposed class action has also been filed in the Ontario Superior
Court of Justice and a petition for authorization to commence a class action has
been filed in the Quebec Superior Court. Each of these U.S. and Canadian
lawsuits, which have yet to be certified as a class action by the respective
courts at this stage, seek to represent a class comprised of persons who
acquired the Company's common shares between August 2, 2007 and April 29, 2008
and allege, among other things, that the defendants misrepresented the Company's
financial prospects in its financial guidance concerning the 2008 fiscal year,
subsequently revised on April 29, 2008. The U.S. lawsuits are based on United
States federal securities laws. In addition to pursuing common law claims, the
Ontario action proposes to seek leave from the Ontario court to also bring
statutory misrepresentation civil liability claims under Ontario's <i>Securities
Act</i>. The Company strongly contests the basis upon which these actions are
predicated and intends to vigorously defend its position. However, due to the
inherent uncertainties of litigation, it is not possible to predict the final
outcome of these lawsuits or determine the amount of any potential losses, if
any. No provision for contingent loss has been recorded in the interim
consolidated financial statements. </p>
<table border="0" cellpadding="0" cellspacing="0" style="border-collapse: collapse" bordercolor="#111111" width="100%">
  <tr>
    <td width="100%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2" color="#1060B3">
    <p align="justify"><font SIZE="2">Forward-Looking Statements&nbsp; </font>
    </font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY">Certain statements included in this MD&amp;A 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;project&quot;, &quot;assume&quot;, &quot;anticipate&quot;, &quot;plan&quot;, &quot;foresee&quot;, &quot;believe&quot; or
&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, as
subsequently updated in this MD&amp;A and in our first and second quarter 2008 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>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.23</b></font></td>
  </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>
    <td width="50%"><font size="2">
    <img border="0" src="gildan2.jpg" width="84" height="26"></font></td>
    <td width="50%">&nbsp;</td>
  </tr>
  <tr>
    <td width="50%">&nbsp;</td>
    <td width="50%"><font SIZE="2" color="#808080">
    <p align="right"><b>MANAGEMENT'S DISCUSSION AND ANALYSIS </b></font></td>
  </tr>
</table>
<font 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>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"></font>
  <font 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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  impact of economic and business conditions, industry trends and other
  external, political and social factors in the countries in which we operate;
  </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  intensity of competitive activity; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  changes in environmental, tax, trade, employment and other laws and
  regulations; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to implement our strategies and plans; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to complete and successfully integrate acquisitions; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  reliance on a small number of significant customers; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font 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" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  customers do not commit to minimum quantity purchases; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">the
  seasonality of our business; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">our
  ability to attract and retain key personnel; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">high
  reliance on computerized information systems; </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  changes in accounting policies and estimates; and </font></li>
  <li>
  <p align="justify" style="margin-top: 0; margin-bottom: 0"><font SIZE="2">
  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 write-downs 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. The purpose of the forward-looking
statements is to provide the reader with a description of management's
expectations regarding the Company's fiscal 2008 and 2009 financial performance
and may not be appropriate for other purposes. 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>
<p align="justify">August 12, 2008 </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td><font SIZE="2" color="#808080">
    <p align="right"><b>GILDAN QUARTERLY REPORT &#150; Q3 2008 P.24</b></font></td>
  </tr>
</table>
<hr color="#000000" SIZE="5">

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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
