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<SEC-DOCUMENT>0001204459-09-000236.txt : 20090212
<SEC-HEADER>0001204459-09-000236.hdr.sgml : 20090212
<ACCEPTANCE-DATETIME>20090211204717
ACCESSION NUMBER:		0001204459-09-000236
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20090211
FILED AS OF DATE:		20090212
DATE AS OF CHANGE:		20090211

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:		09591427

	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>gildan021009form6k.htm
<TEXT>

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



<html>

<body>

<div style="border-top: 1px solid; padding-top: 1px">
  <hr color="#000000" SIZE="5">
</div>
<font face="Times New Roman" size="5"><b>
<p align="center">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:
      February 2009</font></td>
      <td width="50%">
      <p align="center"><font face="Times New Roman" size="2">&nbsp;Commission File
      Number: 1-14830 </font></td>
    </tr>
  </table>
  </center>
</div>
<font face="Times New Roman" size="5"><b>
<p align="center">GILDAN ACTIVEWEAR INC.</b> <br>
</font>(<i>Translation of Registrant's name into English</i>) </p>
<p align="center">
<b>
              600 de Maisonneuve Boulevard West<br>
33rd Floor<br>
Montr&#233;al, Qu&#233;bec <br>
Canada H3A 3J2</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 vAlign="top" align="left" style="font-size: 10pt" width="50%">&nbsp;</td>
    <td align="left" colSpan="2" style="font-size: 10pt"><b>GILDAN ACTIVEWEAR INC.</b></td>
  </tr>
  <tr>
    <td align="left" style="font-size: 10pt" width="50%">&nbsp;</td>
    <td vAlign="top" style="font-size: 10pt" width="1%">&nbsp;</td>
    <td style="border-bottom: medium none #000000; font-size:10pt" align="left" width="49%">&nbsp;</td>
  </tr>
  <tr>
    <td align="left" style="font-size: 10pt" width="50%">Date: February 11, 2009</td>
    <td vAlign="top" style="font-size: 10pt" width="1%">By:&nbsp;&nbsp;</td>
    <td style="border-top: medium none; border-bottom: 1px solid #000000; font-size:10pt" align="left" width="49%">
    /s/ Lindsay Matthews &nbsp;</td>
  </tr>
  <tr>
    <td align="left" style="font-size: 10pt" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" width="1%">&nbsp;</td>
    <td vAlign="top" style="font-size: 10pt" width="49%">
    <p style="margin-top: 0; margin-bottom: 0">Name:&nbsp;&nbsp;</p>
    <p style="margin-left: 26pt; margin-top: -11pt; margin-bottom: 0"><font face="Times New Roman" size="2">Lindsay Matthews&nbsp;</font></td>
  </tr>
  <tr>
    <td align="left" style="font-size: 10pt" width="50%">&nbsp;</td>
    <td style="font-size: 10pt" width="1%">&nbsp;</td>
    <td vAlign="top" style="font-size: 10pt" width="49%">
    <p style="margin-top: 0; margin-bottom: 0">Title:&nbsp;&nbsp;</p>
    <p style="margin-left: 26pt; margin-top: -11pt; margin-bottom: 0"><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="exh991.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="exh991.htm" style="text-decoration: none">Q1 2009 -
    Quarterly Report to Shareholders</a></td>
  </tr>
  <tr vAlign="bottom">
    <td vAlign="center" height="15">
    <a href="exh992.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="exh992.htm" style="text-decoration: none">Q1 2009 - Management&#146;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>exh991.htm
<TEXT>


<HTML>
<HEAD>
   <TITLE> Gildan Activewear Inc: Exhibit 99.1&nbsp; - Prepared by TNT Filings
   Inc.</TITLE>

</HEAD>

<BODY style="font-size:10pt;">

<div style="border-top-style: solid; border-top-width: 1; padding-top: 1">
  <hr color="#000000" size="5">
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<!--$$/page=--><A name=page_1></A>
<P align=center><IMG src="mdax1x1.jpg" border=0 width="244" height="89"> </P>
<p align="center"><IMG src="mdax1x2.jpg" border=0 width="442" height="286">
<BR>
</p>
<div align="center">
  <center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="60%" border=0>

  <TR vAlign=top>
    <TD align=right nowrap><B>MD&amp;A:</B> </TD>
    <TD align=left width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Our Business </TD>
    <TD align=right width="15%">2 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Strategy and Objectives </TD>
    <TD align=right width="15%">4 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Operating Results </TD>
    <TD align=right width="15%">5 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Financial Condition </TD>
    <TD align=right width="15%">8 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Cash Flows </TD>
    <TD align=right width="15%">9 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Liquidity and Capital Resources </TD>
    <TD align=right width="15%">10 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Legal Proceedings </TD>
    <TD align=right width="15%">11 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Outlook </TD>
    <TD align=right width="15%">12 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Financial Risk Management </TD>
    <TD align=right width="15%">12 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Critical Accounting Estimates </TD>
    <TD align=right width="15%">15 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Adoption of New Accounting Standards </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Future Accounting Standards </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Related Party Transactions </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Internal Control Over Financial Reporting </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Risks and Uncertainties </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Definition and Reconciliation of Non-GAAP Measures </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Forward-Looking Statements </TD>
    <TD align=right width="15%">19 </TD></TR>
  <TR>
    <TD nowrap>&nbsp; </TD>
    <TD width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap><B>Interim Consolidated Financial Statements</B> </TD>
    <TD align=right width="15%">21 </TD></TR>
  <TR>
    <TD nowrap>&nbsp; </TD>
    <TD width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap><B>Notes to Interim Consolidated Financial Statements</B>
    </TD>
    <TD align=right width="15%">25 </TD></TR></TABLE></center>
</div>
<BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_2></A>
<P align=right><FONT size=2><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND
ANALYSIS</FONT></FONT></P>
<P align=justify>This Management&#146;s Discussion and Analysis (MD&amp;A) comments
on Gildan&#146;s operations, performance and financial condition as at and for the
three months ended January 4, 2009, compared to the corresponding period 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 MD&amp;A should be read together with
the unaudited interim consolidated financial statements as at and for the three
months ended January 4, 2009, and the related notes, and with our MD&amp;A for
the year ended October 5, 2008 (2008 Annual MD&amp;A) which is part of the
fiscal 2008 Annual Report. This MD&amp;A is dated February 11, 2009. All amounts
in this report are in US dollars, unless otherwise noted.</P>
<P align=justify>All financial information contained in this 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 &#147;Non-GAAP Financial
Measures&#148; on page 5 of this MD&amp;A. The unaudited interim consolidated
financial statements and this MD&amp;A were reviewed by Gildan&#146;s Audit and
Finance Committee and were approved by our Board of Directors. </P>
<P align=justify>Additional information about Gildan, including our 2008 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
<U>www.sec.gov</U>. </P>
<P align=justify>This document contains forward-looking statements, which are
qualified by reference to, and should be read together with the &#147;Forward-looking
Statements&#148; cautionary notice on page 19. </P>
<P align=justify>In this MD&amp;A, &#147;Gildan&#148;, the &#147;Company&#148;, or the words &#147;we&#148;,
&#147;us&#148;, &#147;our&#148; refer, depending on the context, either to Gildan Activewear Inc. or
to Gildan Activewear Inc. together with its subsidiaries and joint venture. </P>
<P align=justify>The Company&#146;s revenues and income are subject to seasonal
variations. Consequently, the results of operations for the first quarter are
traditionally not indicative of the results to be expected for the full year.
</P>
<P align=justify><B><U>OUR BUSINESS</U></B><B> </B></P>
<P align=justify>Gildan is a vertically-integrated marketer and manufacturer of
activewear, socks and underwear. 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 screenprint channel in the U.S. and
Canada, and also a leading supplier for this market in Europe. We sell socks and
underwear, in addition to our activewear products, to mass-market and regional
retailers in North America. The acquisitions of Kentucky Derby Hosiery (Kentucky
Derby) in July 2006 and V.I. Prewett &amp; Son, Inc. (Prewett) in October 2007,
combined with the addition of new branded and private label sock programs, have
positioned Gildan as a leading supplier of basic family socks in the U.S.
mass-market retail channel. </P>
<P align=justify><B>Our Products </B></P>
<P align=justify>We specialize in marketing and large-scale low-cost
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 products, namely T-shirts, fleece and sport
shirts, in large quantities to wholesale distributors as undecorated &#147;blanks&#148;,
which are subsequently sold to screenprinters and embroiderers who decorate our
products with designs and logos. Our products are made of cotton and of blends
of cotton and synthetic fibers. We sell our products to wholesale distributors
under the Gildan brand. Our products are used in a variety of daily activities
by consumers. Uses of our activewear product-line include work and school
uniforms, athletic teamwear and other end-uses to convey individual, group and
team identity. Consumers also purchase the Company&#146;s activewear products in
venues such as sports, entertainment and corporate events, as well as travel and
tourism destinations.</P>
<P align=justify>In the retail channel, we sell a variety of styles of socks
and, to a lesser extent at this stage, men&#146;s and boys&#146; underwear and undecorated
activewear products. We sell these products to mass-market and regional
retailers in North America under various retailer private label programs and
under the Gildan brand. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.2
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_3></A>
<P align=right><FONT size=2><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND
ANALYSIS</FONT></FONT></P>
<P align=justify><B>Our Facilities </B></P>
<P align=justify><U>Manufacturing </U></P>
<P align=justify>To support our sales in the various markets, we have built
modern manufacturing facilities located in Central America and the Caribbean
Basin where we manufacture T-shirts, fleece, sport shirts, socks and underwear.
Our largest manufacturing hub in Central America includes our first integrated
knitting, bleaching, dyeing, finishing and cutting textile facility (Rio Nance
1) to produce activewear and, more recently, underwear fabric. This facility,
located in Rio Nance, Honduras, became operational in 2002. During 2007, we
commenced production at an integrated sock manufacturing facility (Rio Nance 3)
and a new integrated textile facility for the production of activewear fabric
(Rio Nance 2), in Rio Nance, Honduras. <B></B></P>
<P align=justify>We have also established a vertically-integrated Caribbean
Basin manufacturing hub with a textile facility for the production of activewear
fabric in Bella Vista, Dominican Republic, which became operational in fiscal
2005.</P>
<P align=justify>In addition to our integrated sock manufacturing facility and
leased sock finishing facility, located in our Central America hub, we operate
U.S. sock manufacturing facilities in Fort Payne, Alabama, purchased as part of
the sock manufacturing acquisition in fiscal 2008. On December 11, 2008, we
announced plans to phase out sock finishing operations in the U.S. by the end of
June 2009 and consolidate operations in Honduras, in order to remain globally
competitive in the current economic conditions. </P>
<P align=justify>Our sewing facilities are strategically located in close
proximity to our textile manufacturing facilities. We own and operate sewing
facilities in Nicaragua and Honduras to support our textile manufacturing hub in
Central America. To support our vertically-integrated production in the
Dominican Republic, we utilize third-party contractors in Haiti, and we are in
the process of establishing a sewing facility in the Dominican Republic which we
expect to be operational in fiscal 2009.</P>
<P align=justify><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&#146;s yarn-spinning operations, together with
supply agreements currently in place with Frontier and other third-party yarn
providers, serve to meet our yarn requirements. </P>
<P align=justify><U>Sales, Marketing and Distribution </U></P>
<P align=justify>Our global sales and marketing office is located in St.
Michael, Barbados where we employ more than 160 full-time employees. Our sales
and marketing team is responsible for all customer-related functions including
sales management, marketing, customer service, credit management, sales
forecasting, and inventory control. </P>
<P align=justify>We distribute our products for the screenprint channel 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. To
service the mass-market retail channel, we operate distribution centres in
Martinsville, Virginia and Fort Payne, Alabama.</P>
<P align=justify><U>Employees and Corporate Offices</U></P>
<P align=justify>As of the end of the first quarter of fiscal 2009 we employed
more than 19,000 full-time employees worldwide. Our corporate head office is
located in Montreal, Canada. </P>
<P align=justify><B>Market Overview </B></P>
<P align=justify><U>Target Market </U></P>
<P align=justify>Our markets for activewear, socks and underwear are
characterized by low fashion risk compared to many other apparel markets, since
our products are basic, frequently replenished 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=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.3
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_4></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The demand for activewear products in the screenprint channel
has been driven by several market trends such as:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>the use of activewear for uniform applications;
  <LI>the use of activewear for corporate promotions;
  <LI>the use of activewear for event merchandising (such as concerts,
  festivals, etc.);
  <LI>the evolution of the entertainment/sports licensing and merchandising
  businesses;
  <LI>the use of activewear products for travel and tourism;
  <LI>the emphasis on physical fitness; and
  <LI>the 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>In the U.S. screenprint channel, T-shirt unit shipments have
grown at a compounded annual rate of 4.5%, between 1999 and 2008, according to
S.T.A.R.S. reports produced by ACNielsen Market Decisions which tracks unit
volume shipments from U.S. wholesale distributors to U.S. screenprinters.
Industry volume for T-shirts during this ten-year period declined only twice,
namely in calendar year 2001 by 3.4% and in 2008 by 4.9% .</P>
<P align=justify>During fiscal 2009, we expect the current global financial
market crisis and economic slowdown to negatively impact demand in the U.S.
screenprint channel, including a decline in corporate and consumer spending. In
addition, we expect that a more unfavourable supply-demand and competitive
environment, combined with recent deflation in cotton and energy prices, will
result in downward pressure on net selling prices. These same market and
competitive factors and risks may impact demand and selling prices in other
international screenprint markets. Similarly, while the basic replenishment
nature of our products sold into the mass-market retail channel may moderate the
negative impact of the downturn in overall economic conditions and consumer
spending, the retail market for our products has been experiencing weaker demand
and inventory reductions by retailers. Consequently, there is no assurance that
our sales will not be negatively impacted by the current economic
uncertainty.</P>
<P align=justify><U>Competitive Environment </U></P>
<P align=justify>The market for our products is highly competitive. Competition
is generally based upon price, with reliable quality and service also being
requirements for success. Our primary competitors in North America both in the
screenprint and retail channels are the major U.S.-based manufacturers of basic
family apparel for the screenprint and retail channels, such as the Hanes, Fruit
of the Loom, Jerzees and Anvil brands. Competition in socks in the U.S.
mass-market retail channel is more fragmented, with a higher proportion of
private label programs that are frequently outsourced from Asian contractors by
retail vendors based in the U.S. </P>
<P align=justify>The competition in the European screenprint channel is similar
to that in North America, as we compete primarily with the U.S.-based brands
mentioned above. We also have European-based competitors that do not have
integrated manufacturing operations and source products from suppliers in Asia.
In addition, we may face the threat of increasing global competition.</P>
<P align=justify><B><U>STRATEGY AND OBJECTIVES</U></B><B> </B></P>
<P align=justify>Our growth strategy comprises the following initiatives:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>Continue to increase market share in the U.S. screenprint channel in all
  product categories;
  <LI>Leverage our successful business model to further penetrate the
  mass-market retail channel and develop Gildan as a consumer brand;
  <LI>Pursue international growth opportunities;
  <LI>Continue to generate manufacturing and distribution cost reductions; and
  <LI>Pursue selective complementary acquisitions. </LI></UL>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.4
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_5></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<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 a main reason that we have been able to continue to increase our market
presence and establish our market leadership in the imprinted sportswear market.
Management believes that these same factors will support Gildan&#146;s strategy to
expand its presence in international screenprint markets and further penetrate
the retail channel. </P>
<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 under the &#147;Financial Risk Management&#148; and &#147;Risks and Uncertainties&#148;
sections of our 2008 Annual MD&amp;A, as subsequently updated in this interim
MD&amp;A. </P>
<P align=justify><B><U>OPERATING RESULTS</U></B></P>
<P align=justify><B>Statement of Earnings Classifications </B></P>
<P align=justify>Effective the first quarter of fiscal 2009, we changed certain
classifications of our Statement of Earnings and Comprehensive Income with
retrospective application to comparative figures presented for prior periods.
These new classifications align the results of operations by function and
incorporate presentation requirements under Canadian Institute of Chartered
Accountants (CICA) Handbook Section 3031, <I>Inventories</I>, which has been
adopted effective the first quarter of fiscal 2009. Pursuant to the requirements
of Section 3031, depreciation expense related to manufacturing activities is
included in cost of sales. The remaining depreciation and amortization expense
has been reclassified to selling, general and administrative (SG&amp;A)
expenses. Depreciation and amortization expense is therefore no longer presented
as a separate caption on the Statement of Earnings and Comprehensive Income. In
addition, we reclassified certain other items in our Statement of Earnings and
Comprehensive Income. Outbound freight, previously classified within SG&amp;A
expenses, is now reported within cost of sales. Also, a new caption is now
presented for financial expenses and income, which includes interest income and
expenses, foreign exchange gains and losses (including mark-to-market
adjustments of forward foreign exchange contracts), and other financial charges.
Interest expense net of interest income was previously reported as a separate
caption, while foreign exchange gains and losses (including mark-to-market
adjustments of forward foreign exchange contracts) were previously included in
cost of sales. Other financial charges were previously reflected in SG&amp;A
expenses. These changes in classification have resulted in a decrease of $13.4
million and $0.9 million in gross profit and SG&amp;A expenses, respectively,
compared to the amounts previously reported for the first quarter of fiscal
2008. For the period ended December 30, 2007, the decrease of $13.4 million in
gross profit is due to reclassifications of $9.5 million of depreciation and
amortization expense, $3.6 million of outbound freight and $0.3 million of
foreign exchange gains and other financial income. There has been no impact on
net earnings as a result of these changes in classification. </P>
<P align=justify><B>Non-GAAP Measures </B></P>
<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&#146;s financial condition and operating results.</P>
<P align=justify>We refer the reader to page 17 for the definition and complete
reconciliation of all non-GAAP measures used and presented by the Company to the
most directly comparable GAAP measures. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.5
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_6></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B>Summary of Quarterly Results </B></P>
<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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left colspan="2" nowrap><I>(in $ millions,
      except per share amounts) </I><I><SUP>(1) </SUP></I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="7%"><B>2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">2008
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">2007
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><B>Q1
      </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q4 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q2 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q1 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q4 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q2 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net Sales </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>184.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>324.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>380.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>293.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>250.5 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>254.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>291.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>232.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Net earnings<I><SUP>(2) </SUP></I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>4.3 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">21.8 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">54.5 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">42.1 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">27.9 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">41.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">52.4 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">20.9 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net earnings per share<SUP>(2) </SUP></TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Basic EPS </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>0.04 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.18 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.45 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.35 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.23 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.34 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.44 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.17 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Diluted EPS </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>0.04 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.18 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.45 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.35 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.23 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.34 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.43 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.17 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Total assets<I><SUP>(2) </SUP></I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>1,043.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,101.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,104.4 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,057.9 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">993.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">872.0 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">822.0 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">792.6 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total long-term financial liabilities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>51.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>53.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>108.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>146.3 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>130.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>59.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>42.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>74.2 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Weighted average number of </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#FFFFFF>&nbsp;&nbsp;&nbsp; shares outstanding
      <I>(in &#145;000s) </I></TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Basic </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF"><B>120,573 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,531 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,492 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,464 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,428 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,401 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,359 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,320 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#FFFFFF>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Diluted </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF><B>121,408 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,558 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,622 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,649 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,656 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,577 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,599 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,529 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR>
    <TD vAlign=top><I><SUP><font style="font-size: 8pt">(1) </font> </SUP></I>
    </TD>
    <TD>
      <P align=justify><font style="font-size: 8pt"></font></font><I><font style="font-size: 8pt">Quarterly results reflect the acquisition of Prewett
      on October 15, 2007 (Q1 2008) from the date of acquisition.</font></I></P></TD></TR>
  <TR>
    <TD vAlign=top><I><SUP><font style="font-size: 8pt">(2) </font> </SUP></I>
    </TD>
    <TD>
      <P align=justify><font style="font-size: 8pt"></font></font><I><font style="font-size: 8pt">Net earnings, Net earnings per share and Total assets
      reflect the impact of the change in accounting policy as described in Note
      3 to the unaudited interim consolidated financial
  statements.</font></I></P></TD></TR></TABLE>
<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. 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 in
sales we have historically experienced will continue in the future, although it
is expected to be somewhat mitigated by our product diversification should
fleece and sock products account for a higher proportion of our total sales.
<B></B></P>
<P align=justify>Historically, throughout the year, we have operated 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, in particular a build-up of inventory
levels in the first half of the year. In the current economic environment, we
intend to prudently manage our inventory levels in relation to market conditions
as they evolve, and we will evaluate the need for production downtime as
required to align inventories with demand.<B> </B></P>
<P align=justify><B>Net Sales </B></P>
<P align=justify>Net sales for the first quarter of fiscal 2009, which is
seasonally the lowest quarter of the fiscal year for our activewear sales,
amounted to $184.0 million, down 26.5% from $250.5 million in the first quarter
of fiscal 2008. The decrease in net sales was due to a 28.0% decline in
activewear and underwear unit volumes, a decrease of 16.9% in sock sales and
more unfavourable activewear product-mix. The lower unit volumes were due to an
11.6% decline in overall industry unit shipments by U.S. wholesale distributors
to screenprinters and the significant impact of inventory reductions during the
quarter by U.S. wholesale distributors, which more than offset Gildan&#146;s
increased market share penetration in the U.S. screenprint channel.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.6
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_7></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></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. The table below summarizes the S.T.A.R.S. data for the
calendar quarter ended December 31, 2008: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left width="46%">&nbsp; </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>Three months ended </B></TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>Three months ended </B></TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left width="46%">&nbsp; </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>December 31, </B></TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>December 31, </B></TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>2008 vs. 2007 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>2008 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>2007 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Unit Growth </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Market Share </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>Gildan </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>Industry </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Gildan </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff width="46%">All products </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>(4.7</B></TD>
    <TD align=left width="3%" bgColor=#e6efff><b>)% </b> </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>(11.6</TD>
    <TD align=left width="3%" bgColor=#e6efff>)% </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>53.3% </B></TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>49.3% </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left width="46%">T-shirts </TD>
    <TD align=left width="3%">&nbsp;</TD>
    <TD align=right width="8%"><B>(3.8</B></TD>
    <TD align=left><b>)% </b> </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right>(10.9</TD>
    <TD align=left>)% </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right><B>54.2% </B></TD>
    <TD align=left width="3%">&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right>50.0% </TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff width="46%">Fleece </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>(7.1</B></TD>
    <TD align=left bgColor=#e6efff><b>)% </b> </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff>(12.0</TD>
    <TD align=left bgColor=#e6efff>)% </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff><B>51.9% </B></TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff>49.1% </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="46%">Sport shirts </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right><B>(25.7</B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><b>)% </b> </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right>(25.8</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>)% </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right><B>35.4% </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right>35.4%
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD></TR></TABLE>
<P align=justify>Gildan achieved market share gains in both the T-shirt and
fleece categories, while our market share for sport shirts remained flat
compared to the same period last year. In the T-shirt category, we increased our
market share by approximately 4 percentage points to 54.2% . Similarly in the
fleece category we increased our market share to 51.9% compared to 49.1% in the
same period last year.</P>
<P align=justify>Activewear unit shipments to Canada and our international
markets were down by 20.3% for the first quarter of fiscal 2009. The Canadian
market reflected the biggest decline, which was impacted by inventory reductions
by distributors. While sales in Europe for the first quarter of fiscal 2009 were
slightly below first quarter fiscal 2008 levels, shipments in the last two
months of the first quarter of fiscal 2009 were up year over year. Although
sales in Mexico represent a small portion of our total international business,
sales in Mexico were up significantly during the quarter, benefiting from the
improved sales and distribution infrastructure that has been implemented. </P>
<P align=justify>Sales of socks for the first quarter of fiscal 2009 included an
extra two weeks of sales from the Prewett acquisition, which was effective from
October 15, 2007. However, unit sales of socks decreased due to the elimination
of unprofitable sock product-lines during fiscal 2008, and a reduction in
inventories carried by retailers. Unit sales of Gildan socks from Gildan&#146;s major
retail customers to consumers were essentially unchanged compared with the
previous year, in spite of weak overall retail market conditions.</P>
<P align=justify><B>Gross Profit </B></P>
<P align=justify>Gross profit for the first quarter of fiscal 2009 was $38.9
million, or 21.1% of net sales, compared to $65.6 million, or 26.2% of net sales
during the first quarter of fiscal 2008. The decline in gross margins was due to
significantly higher cotton and energy costs, more unfavourable activewear
product-mix due to a lower proportion of high-valued fleece and long-sleeve
T-shirts, higher depreciation expenses absorbed in cost of sales, a higher
proportion of sales of socks compared to activewear, the temporary impact of
additional packaging costs related to a transition in sock private label brands
for Gildan&#146;s largest retail customer, which is being implemented in the second
half of fiscal 2009, and higher labour costs. These factors were partially
offset by increased manufacturing efficiencies, the non-recurrence of sock
inventory write-downs in the first quarter of fiscal 2008 and higher net selling
prices compared to the first quarter of last year. </P>
<P align=justify><B>Selling, General and Administrative Expenses</B></P>
<P align=justify>Selling, general and administrative (SG&amp;A) expenses in the
first quarter of fiscal 2009 were $33.5 million, or 18.2% of sales, compared to
$31.7 million, or 12.7% of sales, in the first quarter of last year. Higher
SG&amp;A expenses reflected a $1.8 million impact of an increase in accounts
receivable provisions, together with higher professional and legal fees,
partially offset by lower volume-related distribution expenses and the impact of
the reduction in the value of the Canadian dollar on Gildan&#146;s corporate
administrative expenses. </P>
<P align=justify><B>Restructuring and Other Charges </B></P>
<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 our corporate office. In addition, in the third quarter of fiscal 2008, we
announced the planned consolidation of our Haiti sewing operation to be
finalized in the first half of fiscal 2009. The costs incurred in connection
with these initiatives have been recorded as restructuring and other
charges.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.7
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_8></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Restructuring charges of $0.9 million in the first quarter of
fiscal 2009 included $0.3 million of additional severance relating to the
closures noted above, and $0.6 million of exit costs, mainly for the closure of
the Haiti sewing facility. Restructuring charges of $0.8 million in the first
quarter of fiscal 2008 were composed of $1.1 million of other exit costs,
primarily related to the closures noted above, including carrying and
dismantling costs associated with assets held for sale, less a gain of $0.3
million recognized on the disposal of assets held for sale. </P>
<P align=justify>Assets held for sale of $10.5 million as at January 4, 2009
(October 5, 2008 - $10.5 million; December 30, 2007 - $12.7 million) include
property, plant and equipment at these various locations. We expect to incur
additional carrying costs relating to these assets, which will be accounted for
as restructuring charges as incurred during fiscal 2009, until all property,
plant and equipment related to the closures are disposed of. Any gains or losses
on the disposition of the assets held for sale will also be accounted for as
restructuring charges as incurred. </P>
<P align=justify><B>Financial Expense, net </B></P>
<P align=justify>Net financial expense amounted to $0.2 million during the first
quarter of fiscal 2009, compared to net financial expense of $2.7 million in the
same period last year. The decrease in net financial expense in the quarter
resulted primarily from a decrease in interest expense of $1.9 million and an
increase in foreign exchange gains of $0.7 million. The decrease in interest
expense was due to higher average borrowings during the first quarter of fiscal
2008 to finance the acquisition of Prewett and the impact of lower average
interest rates during the first quarter of fiscal 2009.</P>
<P align=justify><B>Income Taxes </B></P>
<P align=justify>Income tax expense for the first quarter of fiscal 2009 was
$0.3 million compared to an income tax expense of $2.1 million in the first
quarter of fiscal 2008. Excluding the impact of restructuring and other charges,
the effective income tax rate in the first quarter of fiscal 2009 was 6.0%
compared to an effective income tax rate of 6.8% for the same period last year.
</P>
<P align=justify><B>Net Earnings </B></P>
<P align=justify>Net earnings were $4.3 million, or $0.04 per share on a diluted
basis, for the first quarter ended January 4, 2009, compared with net earnings
of $27.9 million, or $0.23 per share on a diluted basis in the first quarter of
fiscal 2008.</P>
<P align=justify>The reduction in net earnings and earnings per share (EPS) on a
diluted basis in the first quarter compared to last year was primarily due to
significantly lower unit sales volumes, combined with higher cotton and energy
costs reflected in inventories consumed in cost of sales during the quarter,
more unfavourable activewear product-mix, and increased provisions for accounts
receivable. Cotton costs are projected to be at their highest point during the
year in the first quarter of fiscal 2009, and were at their lowest point during
fiscal 2008 in the first quarter. These negative factors were partially offset
by favourable manufacturing efficiencies and higher net selling prices for
activewear, compared to the first quarter of fiscal 2008. Our results were
within our EPS guidance range of $0.00 - $0.05 for the first quarter of fiscal
2009, provided on December 11, 2008. Compared to our EPS guidance for the
quarter, the impact of lower than projected selling price discounts was offset
by lower than projected unit sales volumes due to continuing inventory
destocking by U.S. wholesale distributors, and increased provisions for accounts
receivable. </P>
<P align=justify><B><U>FINANCIAL CONDITION</U></B><B> </B></P>
<P align=justify>Accounts receivable of $98.8 million as at January 4, 2009
reflected decreases of $123.4 million compared to accounts receivable of $222.2
million at the end of fiscal 2008 and $53.2 million compared to the end of the
first quarter of fiscal 2008. The decrease in accounts receivable from the end
of fiscal 2008 reflected a lower seasonal level of sales and a decline in days
sales outstanding consistent with prior years due to seasonal programs invoiced
with extended payment terms maturing in the first quarter. The decrease in
accounts receivable compared to the first quarter of fiscal 2008
primarily reflected the 26.5% sales decline over the prior year.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.8
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_9></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Inventories of $386.4 million were up $70.2 million, or 22.2%
from October 5, 2008 and up $91.8 million, or 31.2% compared to the first
quarter of fiscal 2008. Consistent with prior years, our activewear inventories
increased during the first quarter of our fiscal year, as we do not adjust
production levels to match seasonal sales patterns. The increase in activewear
inventories over the fourth quarter of fiscal 2008 was partially offset by a
seasonal decrease in sock inventories. The increase in inventories from the
first quarter of fiscal 2008, resulted from a higher seasonal build-up of
activewear inventories and higher unit costs due to increases in cotton and
energy prices. The Company will carefully monitor its inventory levels in
relation to market conditions as they evolve, and may schedule production
downtime where required to realign inventories with market demand. </P>
<P align=justify>Property, plant and equipment, which are net of accumulated
amortization, including asset impairment losses, amounted to $435.2 million at
January 4, 2009, a decrease of $1.3 million compared to $436.5 million at
October 5, 2008. The decrease was primarily due to net capital expenditures of
$13.7 million, mainly for the capacity expansion projects in Honduras, offset by
depreciation of property, plant and equipment of $15.0 million.</P>
<P align=justify>Intangible assets amounted to $59.2 million as at January 4,
2009 compared to $60.0 million at the end of fiscal 2008. The decrease related
to the amortization of intangible assets for the first quarter of fiscal 2009.
Goodwill of $6.7 million at the end of the first quarter of fiscal 2009 related
to the acquisition of Prewett in October 2007. In light of the current economic
and market conditions, including the negative impact on our current results, we
deemed it appropriate to perform an impairment test on our goodwill in the first
quarter of fiscal 2009 by comparing the fair value of the reporting unit
associated with the goodwill to its carrying value. Management concluded that
there has been no impairment in the value of goodwill carried on the interim
consolidated balance sheet as at January 4, 2009. In addition, management
concluded that the carrying value of intangible assets was fully recoverable as
at January 4, 2009. </P>
<P align=justify>Total assets were $1,043.5 million as at January 4, 2009,
compared to $1,101.3 million at the end of the previous year. Working capital
was $363.1 million as at January 4, 2009 compared to $355.2 million as at
October 5, 2008. The current ratio at the end of the first quarter of fiscal
2009 was 3.5 compared to 2.7 at the end of fiscal 2008. </P>
<P align=justify>Accounts payable and accrued liabilities amounted to $124.6
million at January 4, 2009, compared to $155.7 million at the end of fiscal
2008. The decrease of $31.1 million was primarily due to seasonal factors and
lower capital spending.</P>
<P align=justify>Income taxes payable were $17.4 million at January 4, 2009
compared to $46.6 million at October 5, 2008. The decrease in income taxes
payable was mainly due to a payment of $23.8 million related to the settlement
of the Canada Revenue Agency audit as announced in December 2008 and as
described in Note 14 to the 2008 annual audited Consolidated Financial
Statements. </P>
<P align=justify><B><U>CASH FLOWS</U></B><B> </B></P>
<P align=justify>Cash flows from operating activities in the first quarter of
fiscal 2009 were $15.9 million down from $103.4 million for the previous year.
The decrease in cash inflow was primarily due to lower cash operating earnings,
higher seasonal increases in inventories, a higher seasonal decline in accounts
payable and accrued liabilities and income tax payments of $23.8 million in
respect of prior fiscal years, offset by a larger seasonal decrease in accounts
receivable compared to the first quarter of fiscal 2008. </P>
<P align=justify>Cash flows used in investing activities were $12.1 million in
the first quarter of fiscal 2009, compared to $169.2 million in the previous
year. The decrease of $157.1 million was mainly due to the acquisition of
Prewett in the first quarter of fiscal 2008 for a purchase price of $126.8
million, plus a contingent payment of $10.0 million, which was placed in escrow.
The remaining decrease was mainly due to lower capital expenditures, as the Rio
Nance 2 and Rio Nance 3 projects were being ramped up during the first quarter
of last year. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.9
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_10></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>We generated free cash flow<SUP>1 </SUP>of $2.9 million in the
first quarter of fiscal 2009 compared to $71.0 million for the same period last
year, mainly as a result of lower cash flows from operating activities. </P>
<P align=justify>Cash flows used in financing activities were $1.5 million in
the first quarter of fiscal 2009 compared to cash inflows of $70.2 million in
the first quarter last year. The decrease in use of funds related mainly to a
net amount of $71.0 million drawn on our revolving long-term credit facility in
the first quarter of fiscal 2008 to finance the acquisition of Prewett in
October 2007.</P>
<P align=justify>We ended the first quarter of fiscal 2009 with cash and cash
equivalents of $14.4 million compared to $12.4 million at the end of fiscal
2008. Total indebtedness<SUP>2 </SUP>as at January 4, 2009 amounted to $51.2
million compared to $130.8 million at the end of the first quarter of fiscal
2008 and $53.0 million at the end of fiscal 2008. We had $45 million drawn from
our revolving long-term credit facility as at the end of the first quarter of
fiscal 2009 and as at October 5, 2008. In addition, an amount of $1.0 million
has been committed against this facility to cover various letters of credits. In
fiscal 2008, we used our revolving long-term credit facility, in addition to our
cash flow from operations, to finance the acquisition of Prewett and capital
expenditures of our major capacity expansion projects in Honduras. Indebtedness
to fund the acquisition of Prewett was fully repaid using operating cash flows
during fiscal 2008. </P>
<P align=justify><B><U>LIQUIDITY AND CAPITAL RESOURCES</U></B><B> </B></P>
<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 uses of funds on an ongoing
basis are for capital expenditures for new manufacturing facilities,
inventories, accounts receivable, and business acquisitions. In fiscal 2009, we
are also using funds for the payment of income taxes pursuant to the Company&#146;s
settlement of its transfer pricing audit with the Canada Revenue Agency as
announced in December 2008.</P>
<P align=justify>On October 30, 2007, we increased our committed long-term
credit facility to $400 million, on an unsecured basis, which matures in June
2013. We believe that our cash flow from operating activities together with the
unused portion of our credit facilities will provide us with sufficient
liquidity and capital resources in fiscal 2009 to fund our anticipated working
capital, capital expenditure requirements and income tax payments. </P>
<P align=justify>A major objective for the Company in fiscal 2009 will be to
maintain its strong financing position and ensure that it continues to be in a
position to take advantage of any strategic growth opportunities that may arise. In the current economic environment, Gildan intends to
prudently manage both receivable and inventory levels and its capital
expenditures. Inventories will be carefully monitored in relation to market
conditions as they evolve, and we will evaluate the need for production downtime
as required to align inventories with sales demand. We are continuing to defer
construction of the Rio Nance 5 facility until the economic outlook in support
of further major capacity expansion becomes clearer. In addition, we have
decided to proceed cautiously on other expansion projects and defer the ramp-up
of our second sock manufacturing facility (Rio Nance 4) in Honduras. We plan to
transfer our U.S. sock finishing operations to an existing leased facility in
Honduras in order to achieve planned manufacturing efficiencies without
incurring major capital costs or creating significant new industry overcapacity.
The Rio Nance 4 building will be utilized as a distribution centre while sock
capacity expansion requirements are re-assessed. Capital expenditures for fiscal
2009 are now projected at approximately $80 million, compared with our previous
forecast of $115 million and our original projection of $160 million in August
2008.</P>
<P align=justify>The projected capital investments primarily include estimated
expenditures related to investments to complete the construction of the building
for the Rio Nance 4 facility in Honduras, incremental capacity expansions at
existing facilities, a biomass combustion energy project in the Dominican
Republic and capital investments related to the expansion of our sales and
marketing infrastructure in Barbados following the integration of our retail
activities. </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top colspan="2"><u>______________________</u></TD>
    </TR>

  <TR>
    <TD vAlign=top><FONT size=1><SUP>1 </SUP></FONT></TD>
    <TD><FONT size=1>
      <P align=justify>Free cash flow is comprised of cash flows from operating
      activities, including net changes in non-cash working capital balances,
      less cash used in investing activities, excluding business acquisitions.
      See page 19.</P></FONT></TD></TR>
  <TR>
    <TD><FONT size=1>&nbsp;</FONT></TD>
    <TD><FONT size=1>&nbsp;</FONT></TD></TR>
  <TR>
    <TD vAlign=top><FONT size=1><SUP>2 </SUP></FONT></TD>
    <TD><FONT size=1>
      <P align=justify>Total indebtedness is comprised of bank indebtedness and
      long-term debt (including the current portion). See page
  19.</P></FONT></TD></TR></TABLE>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.10
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_11></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>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&#146;s Board
of Directors periodically evaluates the merits of introducing a dividend. </P>
<P align=justify><B>Contractual Obligations </B></P>
<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 by period, excluding
interest on long-term debt, for the following items as at January 4, 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><FONT size=2>&nbsp; </FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="7%"><FONT size=2>&nbsp; </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>Less than </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>1 to 3 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>4 to 5 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>More than </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT
      size=2><I>(in $ millions) </I></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>Total </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>1 year </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>5 years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><FONT size=2>Long-term debt </FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2><B>51.2
    </B></FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>2.5 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>3.7 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>45.0 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left><FONT size=2>Operating leases </FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>43.5 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>6.4 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>18.7 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>7.9 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>10.5 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><FONT size=2>Purchase obligations
</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2><B>264.5
      </B></FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>234.8 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>29.7 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=2>Other
      obligations </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>44.9 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>44.9 </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff><FONT size=2><B>Total Contractual Obligations
    </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>404.1 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>288.6 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>52.1 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>52.9 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>10.5 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=justify>We expect that cash flows from our operating earnings, together
with our year-end cash balances and unutilized bank facilities, will be
sufficient to meet our obligations for the foreseeable future. </P>
<P align=justify><B>Outstanding Share Data</B></P>
<P align=justify>Our common shares are listed on the New York Stock Exchange and
the Toronto Stock Exchange (GIL). As at January 31, 2009, there were 120,637,793
common shares issued and outstanding along with 1,081,328 stock options and
890,112 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>
<P align=justify><B><U>LEGAL PROCEEDINGS </U></B></P>
<P align=justify><B>Securities Class Actions</B></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
have been consolidated, and a consolidated amended complaint has been filed. 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&#146;s common shares between August 2, 2007 and April 29, 2008 and allege,
among other things, that the defendants misrepresented the Company&#146;s financial
condition and its financial prospects in its financial guidance concerning the
2008 fiscal year, which was 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&#146;s <I>Securities Act </I>and an amended complaint along with
affidavit evidence for leave to pursue such statutory liability claims and class
certification have been filed. 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 unaudited interim consolidated financial statements.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.11
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_12></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B><U>OUTLOOK</U></B></P>
<P align=justify>We believe there is increasing uncertainty regarding the
severity and duration of the current economic and financial crisis. In addition,
continuing weak end-use demand and tighter credit markets may affect the
financial condition and liquidity of wholesale customers, resulting in increased
credit risk and a need for the Company to prudently balance short-term market
share considerations with such increased customer credit risk.</P>
<P align=justify>Gildan&#146;s operations are performing well, and the Company
believes that its strong competitive positioning, combined with its strong
balance-sheet and free cash flow generation, will allow it to take advantage of
potential opportunities resulting from any industry rationalization or
restructuring that may occur as a result of a prolonged industry downturn and
crisis in liquidity. </P>
<P align=justify>A discussion of management&#146;s expectations as to our outlook for
fiscal 2009 is contained in our first quarter fiscal 2009 earnings results press
release dated February 11, 2009. The press release is available on the SEDAR
website at <U>www.sedar.com</U>, on the EDGAR website at <U>www.sec.gov </U>and
on our website at <U>www.gildan.com</U>. </P>
<P align=justify><B><U>FINANCIAL RISK MANAGEMENT</U></B><B> </B></P>
<P align=justify>This section of the MD&amp;A provides disclosures relating to
the nature and extent of the Company&#146;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 section, in conjunction with the information in Note 11 to the
unaudited interim consolidated financial statements (&#147;Financial Instruments&#148;),
are designed to meet the requirements of the Canadian Institute of Chartered
Accountants Handbook Section 3862, &#147;Financial Instruments-Disclosures&#148;, and are
therefore incorporated into, and are an integral part of, the unaudited interim
consolidated financial statements. </P>
<P align=justify><B>Credit risk </B></P>
<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&#146;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 11 to the unaudited interim
consolidated financial statements, represents the Company&#146;s credit exposure at
the reporting date, including trade receivables. Our trade receivables and
credit exposure fluctuate throughout the year based on the seasonality of our
sales and other factors. The Company&#146;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>
<P align=justify>The Company&#146;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 January 4, 2009, the
Company&#146;s ten largest trade debtors accounted for 75.8% of trade accounts
receivable, of which one wholesale customer accounted for 21.9% and one retailer
accounted for 19.1% . Of the Company&#146;s top ten trade debtors, five are wholesale
distributors, and nine are located in the United States. The remaining trade
receivable balances are dispersed among a larger number of debtors across many
geographic areas including the United States, Canada, Europe, Mexico and
Australia.</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&#146;s customers have generally been transacting with
the Company or its subsidiaries for over five years, and credit losses have not
been material during that period. With the exception of the largest wholesale
distributor, which is owned by a large private equity firm and largely financed
by publicly traded bonds, most of our wholesale distributor customers are
privately-held owner-managed enterprises. 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 refinance
existing indebtedness or to obtain additional financing, and could affect their
ability to comply with restrictive debt covenants and meet other obligations.
The profile and credit quality of the Company&#146;s retail customers varies
significantly. Adverse changes in a customer&#146;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&#146;s future purchases or result in
uncollectible accounts receivable from that customer. Future credit losses
relating to any one of our top ten customers could be material and could result
in a material charge to earnings. The likelihood of such losses occurring has
increased given the current economic downturn. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.12
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_13></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The Company&#146;s extension of credit to customers involves
considerable judgment and is based on an evaluation of each customer&#146;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&#146;s
international sales office in Barbados. Where available, the Company&#146;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. From time to time,
the Company will temporarily transact with customers on a prepayment basis where
circumstances warrant. While the Company&#146;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&#146;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&#146;s exposure. The information available through the
insurance company is also considered in the decision process to determine the
credit limits assigned to customers. This policy contains the usual clauses and
limits regarding the amounts that can be claimed by event and by year of
coverage. The Company did not file any claim against this credit insurance
policy for the three month period ended January 4, 2009. </P>
<P align=justify>The Company&#146;s exposure to credit risk for trade receivables by
geographic area and type of customer was as follows as at: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">United States </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>68.7 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">176.0 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Europe </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>7.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">11.9 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Canada </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>4.4 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">14.2 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Other regions </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>3.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">4.2
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left bgcolor="#E6EFFF">Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%" bgcolor="#E6EFFF"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%" bgcolor="#E6EFFF">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Distributors and screenprinters </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>46.5 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">166.2 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Mass-market and
      regional retailers </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>37.7 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">40.1
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left bgcolor="#E6EFFF">Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%" bgcolor="#E6EFFF"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%" bgcolor="#E6EFFF">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR></TABLE>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.13
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_14></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The aging of trade receivable balances was as follows as at:
</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Not past due </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>67.5 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>186.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Past due 0-30 days </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>15.4 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">15.7 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Past due 31-120 days </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>5.1 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Past due 121-180 days </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">2.3 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Past due over 180 days </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>- </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Trade receivables </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>88.8 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>209.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Less allowance for
      doubtful accounts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(4.6</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(2.8</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<P align=justify>The movement in the allowance for doubtful accounts in respect
of trade receivables was as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><I>(in $ millions) </I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Three months ended </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">Twelve months ended </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Balance, beginning of period </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>2.8 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Bad debt expense </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>1.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">4.5 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Write-off of accounts receivable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(4.0</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Increase due to
      acquisition of Prewett </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>-
      </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">0.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff>Balance, end of period </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>4.6 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>2.8 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify><B>Liquidity Risk</B></P>
<P align=justify>Liquidity risk is the risk that the Company will not be able to
meet its financial obligations as they fall due. We require continued access to
capital markets to support our operations as well as to achieve our strategic
plans. We rely on cash resources, debt and cash flows generated from operations
to satisfy our financing requirements. Any impediments to our ability to
continue to meet the covenants and conditions contained in our revolving credit
facility as well as our ability to access capital markets, or the failure of a
financial institution participating in our credit facility, or an adverse
perception in capital markets of our financial condition or prospects, could
have a material impact on our financing capability. In addition, our access to
financing at reasonable interest rates could become influenced by the economic
and credit market environment.</P>
<P align=justify>We manage liquidity risk through the management of our capital
structure and financial leverage, as outlined in Note 20 to the 2008 annual
audited Consolidated Financial Statements (&#147;Capital Disclosures&#148;). In addition,
we manage liquidity risk by continuously monitoring actual and projected cash
flows, taking into account the seasonality of our sales and receipts. We also
monitor the impact of credit market conditions in the current environment. The
Board of Directors reviews and approves the Company&#146;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. </P>
<P align=justify>The Company has a committed revolving credit facility for a
maximum of $400 million which expires in June 2013 and which is subject to a
one-year extension on an annual basis. The Company&#146;s revolving credit facility
is subject to various covenants and conditions. The Company was in compliance
with all covenants as at January 4, 2009. This facility is unsecured and amounts
drawn bear interest at LIBOR rates or U.S. base rate plus an applicable margin.
As at January 4, 2009, $45.0 million was drawn under this facility, bearing an
effective interest rate of 1.78% . As at October 5, 2008, $45.0 million was
drawn under this facility bearing an effective interest rate of 4.75% . </P>
<P align=justify>The Company&#146;s only derivative financial instruments as at
January 4, 2009 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
disclosed in Note 11 to the unaudited interim consolidated financial statements.
</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.14
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_15></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Please refer to the &#147;Financial Risk Management&#148; section of the
Company&#146;s 2008 Annual MD&amp;A for details of the contractual maturities of
financial liabilities. </P>
<P align=justify><B>Foreign Currency Risk</B></P>
<P align=justify>The majority of the Company&#146;s cash flows and financial assets
and liabilities are denominated in U.S. dollars, which is the Company&#146;s
functional and reporting currency. Foreign currency risk is limited to the
portion of the Company&#146;s business transactions denominated in currencies other
than U.S. dollars, primarily for sales and distribution expenses for customers
outside of the United States and head office expenses in Canada. The Company&#146;s
exposure relates primarily to changes in the U.S. dollar versus the Canadian
dollar, the British Pound and the Euro exchange rates. For the Company&#146;s foreign
currency transactions, fluctuations in the respective exchange rates relative to
the U.S. dollar will create volatility in the Company&#146;s cash flows and the
reported amounts for sales and SG&amp;A 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 the U.S. dollar 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&#146;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 flows
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>As at January 4, 2009 all outstanding forward foreign exchange
contracts were reported on a mark-to-market basis and the gains and losses were
included in earnings. The Company elected not to apply hedge accounting for
these derivatives. </P>
<P align=justify>Please refer to the &#147;Financial Risk Management&#148; section of the
Company&#146;s 2008 Annual MD&amp;A for further details of the Company&#146;s significant
foreign currency exposures. </P>
<P align=justify><B>Interest Rate Risk</B></P>
<P align=justify>The Company&#146;s interest rate risk is primarily related to the
Company&#146;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><B><U>CRITICAL ACCOUNTING ESTIMATES</U></B><B> </B></P>
<P align=justify>Our significant accounting policies are described in Note 2 to
our 2008 audited annual 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. In
addition, although our critical accounting estimates remain substantially
unchanged from those that were disclosed in our 2008 Annual MD&amp;A, there is a
likelihood that these estimates may materially change, or new estimates may be
required, given the current uncertain economic conditions. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.15
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_16></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Management believes that the following accounting estimates
require assumptions to be made about matters that are highly uncertain. </P>
<UL style="TEXT-ALIGN: justify">
  <LI>Allowance for Doubtful Accounts;
  <LI>Inventory Obsolescence;
  <LI>Sales Promotional Programs;
  <LI>Recoverability of Long-Lived Assets;
  <LI>Income Taxes; and
  <LI>Business Acquisitions. </LI></UL>
<P align=justify>For a more detailed discussion of these estimates, readers
should review the &#147;Critical Accounting Estimates&#148; section of the 2008 Annual
MD&amp;A.<B> </B></P>
<P align=justify><B><U>ADOPTION OF NEW ACCOUNTING STANDARDS</U></B><B> </B></P>
<P align=justify>Effective the commencement of its 2009 fiscal year, the Company
adopted CICA Handbook Section 3031, <I>Inventories, </I>Section 1400, <I>General Standards of
Financial Statement Presentation </I>and Section 3064, <I>Goodwill and
Intangible Assets</I>. For a detailed description of the new accounting
standards, please refer to Note 3 of the unaudited interim consolidated
financial statements. </P>
<P align=justify><B><U>FUTURE ACCOUNTING STANDARDS</U></B><B> </B></P>
<P align=justify><U>Recent Accounting Pronouncements</U></P>
<P align=justify>In January 2009, the Emerging Issues Committee (EIC) of the
Canadian Accounting Standards Board (AcSB) issued EIC Abstract 173, <I>Credit
Risk and Fair Value of Financial Assets and Financial Liabilities</I>, and the
CICA issued Handbook Section 1582, <I>Business Combinations, </I>Section 1601,
<I>Consolidated Financial Statements</I>, and Section 1602, <I>Non-Controlling
Interests</I>. For a detailed description of the future accounting standards,
please refer to Note 4 of the unaudited interim consolidated financial
statements.<B> </B></P>
<P align=justify><U>International Financial Reporting Standards</U></P>
<P align=justify>In February 2008, Canada&#146;s Accounting Standards Board (AcSB)
confirmed that IFRS, as issued by the International Accounting Standards Board,
will replace Canadian generally accepted accounting principles for publicly
accountable enterprises effective for fiscal years beginning on or after January
1, 2011. As a result, the Company will be required to change over to IFRS for
its fiscal 2012 interim and annual financial statements with comparative
information for fiscal 2011.</P>
<P align=justify>In preparation for the changeover to IFRS, the Company has
developed an IFRS transition plan. The Company is currently in the process of
completing its initial phase, comprised of a diagnostic process, which involves
a comparison of the Company&#146;s current accounting policies under Canadian
generally accepted accounting principles with IFRS. The identified differences
will be analyzed and addressed according to the level of impact they will have
on the key elements of the transition plan. These key elements include:
accounting policies, including choices among policies permitted under IFRS;
information technology and data systems; internal control over financial
reporting; disclosure controls and procedures, including investor relations and
external communications plans; and business activities. </P>
<P align=justify>As the IFRS transition plan progresses, the Company will
continue to report on the status of the transition plan and provide more
detailed information of the impact on the key elements indicated above. </P>
<P align=justify><B><U>RELATED PARTY TRANSACTIONS</U></B><B> </B></P>
<P align=justify>We have transactions with Frontier, which manages the
operations of CanAm. These transactions are in the normal course of operations
and are measured at the exchange amount, which is the amount of consideration
established and agreed to by the related parties. Total purchases of yarn from
Frontier were $38.1 million, along with $0.2 million relating to management fees
for the three months ended January 4, 2009. As at January 4, 2009, we had an
outstanding payable to Frontier of $29.9 million. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.16
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_17></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B><U>INTERNAL CONTROL OVER FINANCIAL REPORTING</U></B><B>
</B></P>
<P align=justify>Management&#146;s annual evaluation and report on the effectiveness
of internal control over financial reporting as of our most recent fiscal year
ended October 5, 2008 was included in the 2008 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 October 5, 2008.
There have been no material changes in internal control over financial reporting
since October 5, 2008.</P>
<P align=justify><B><U>RISKS AND UNCERTAINTIES</U></B><B> </B></P>
<P align=justify>In addition to the risks previously described under the section
&#147;Financial Risk Management&#148;<I> </I>and those described elsewhere in this
MD&amp;A, this section describes the principal risks that could have a material
and adverse effect on our financial condition, results of operations, cash flows
or business, as well as cause actual results to differ materially from our
expectations expressed in or implied by our forward-looking statements. The
risks described below are not the only risks that could affect the Company.
Additional risks and uncertainties not currently known to us or that we
currently deem to be immaterial may also materially and adversely affect our
financial condition, results of operations, cash flows or business.</P>
<P align=justify>The risks described in our 2008 Annual MD&amp;A included
discussions relating to the following important factors: </P>
<UL style="TEXT-ALIGN: justify">
  <LI>Our ability to implement our strategies and plans;
  <LI>Our industry is competitive;
  <LI>Our industry is affected by general economic conditions;
  <LI>Our customers do not commit to purchase minimum quantities;
  <LI>Our production volume may differ from market demand;
  <LI>Our success depends on our ability to anticipate evolving consumer
  preferences and trends;
  <LI>We rely on a relatively small number of significant customers;
  <LI>The price of the raw materials we buy is prone to significant
  fluctuations;
  <LI>We depend on key suppliers;
  <LI>We are subject to international trade regulation;
  <LI>We currently pay income tax at a comparatively low effective rate, which
  could change in the future;
  <LI>Our operations are subject to climate, political, social and economic
  risks;
  <LI>Our operations are subject to environmental regulation;
  <LI>Our business operations significantly rely on our information systems;
  <LI>Our operations could be affected by changes in our relationship with our
  employees or changes to domestic and foreign employment regulations;
  <LI>We may suffer negative publicity if we, or our third party contractors,
  are found to have violated labour laws or engage in labour and other business
  practices that are viewed as unethical; and
  <LI>We depend on key management. </LI></UL>
<P align=justify>For a more detailed discussion of these potential business
risks, readers should review the &#147;Risks and Uncertainties&#148; section of the 2008
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
quarter interim reports similarly filed. </P>
<P align=justify><B><U>DEFINITION AND RECONCILIATION OF NON-GAAP
MEASURES</U></B><B> </B></P>
<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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.17
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_18></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B>Adjusted Net Earnings and Adjusted Diluted EPS </B></P>
<P align=justify>To measure our performance from one period to the next, without
the variations caused by the impacts of restructuring and other charges as
discussed on page 7, management uses adjusted net earnings and adjusted diluted
earnings per share, which are calculated as net earnings and 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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2009 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2008 </B></TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions,
      except per share amounts) </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="12%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>Recast</B><SUP>(1</SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net sales </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>184.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>250.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Cost of sales </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>145.1 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">184.9
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>38.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>65.5 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Selling, general and administrative expenses </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>33.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">31.7 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Restructuring and other charges </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>0.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.8 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Operating income </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>4.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">33.0 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Financial expense, net </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Non-controlling
      interest in consolidated joint venture </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(0.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">0.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Earnings before income taxes </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>4.7 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>30.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>0.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">2.1
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Net earnings and comprehensive income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>4.4 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>27.9 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Adjustments for: </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp; Restructuring and other
      charges<SUP>(2) </SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>0.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.8 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Adjusted net
      earnings </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>5.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">28.7
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Basic EPS </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.04 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">0.23 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Diluted EPS </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.04 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>0.23 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Adjusted diluted
      EPS </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>0.04 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">0.24
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left colSpan=2><FONT size=1><I>Certain minor rounding variances
      exist between the financial statements and this summary. </I></FONT></TD></TR>
  <TR>
    <TD><FONT size=1>&nbsp; </FONT></TD>
    <TD><FONT size=1>&nbsp; </FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I>(1) </I></FONT></TD>
    <TD align=left><FONT size=1><I>Reflects the impact of the
      change in accounting policy as described in Note 3 to the unaudited
    interim consolidated financial statements and the changes to classifications in the
      statement of earnings and comprehensive income as discussed on page 5.</I></FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I>(2) </I></FONT></TD>
    <TD align=left><FONT size=1><I>Adjustment to remove
      restructuring and other charges and the income tax effect thereon. See
      page 7. </I></FONT></TD></TR></TABLE>
<P align=justify><B>EBITDA </B></P>
<P align=justify>EBITDA is calculated as earnings before interest, taxes and
depreciation and amortization and excludes the impact of restructuring and other
charges as discussed on page 7, as well as the non-controlling interest in
consolidated joint venture. 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&#146;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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.18
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_19></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><I>(in $ millions) </I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2009 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">Q1 2008 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="12%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">Recast<SUP>(1</SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net earnings </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>4.4 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>27.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Restructuring and other charges <SUP>(2) </SUP></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.9 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">0.8 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Depreciation and amortization </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>15.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Variation in depreciation included in inventories </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>(4.4</B></TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(1.4</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Interest, net </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Income tax expense </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.3 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">2.1 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Non-controlling interest of consolidated joint venture </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(0.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff>EBITDA </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>17.6 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>44.9 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left colSpan=2><FONT size=1><I>Certain minor rounding variances
      exist between the financial statements and this summary. </I></FONT></TD></TR>
  <TR>
    <TD>
    <p style="margin-right: 10"><FONT size=1>&nbsp; </FONT></TD>
    <TD><FONT size=1>&nbsp; </FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I><SUP>(1) </SUP></I></FONT></TD>
    <TD align=left><FONT size=1><I>Reflects the impact of the
      change in accounting policy as described in Note 3 to the unaudited
      interim consolidated financial statements. </I></FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I><SUP>(2) </SUP></I></FONT></TD>
    <TD align=left><FONT size=1><I>See page 7.
  </I></FONT></TD></TR></TABLE>
<P align=justify><B>Free Cash Flow </B></P>
<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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>Q1
      2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">Q1
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash flows from operating activities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>15.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>103.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Cash flows used in investing activities </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>(12.1</B></TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(169.2</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Add back: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Business acquisitions </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>- </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">126.8 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>&nbsp; &nbsp;Restricted cash related to acquisition </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(0.9</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>10.0 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Free cash flow </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>2.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">71.0
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<P align=justify style="margin-top: 0"><I><FONT size=1>Certain minor rounding variances exist between
the financial statements and this summary. </FONT></I></P>
<P align=justify><STRONG>Total Indebtedness and Net Indebtedness </STRONG></P>
<P align=justify>We consider total indebtedness and net indebtedness to be
important indicators of the financial leverage of the Company. </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"><B>Q1
      2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">Q4
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">Q1
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Current portion of long-term debt </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff><B>3.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>3.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>4.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Long-term debt </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%"><B>48.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">49.4
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">126.2
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Total indebtedness </B></TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff><B>51.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>53.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>130.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Cash and cash
      equivalents </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%"><B>(14.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="10%">(12.4</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="10%">(13.6</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff><B>Net indebtedness </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff><B>36.8 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>40.6 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>117.2 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify style="margin-top: 0"><I><FONT size=1>Certain minor rounding variances exist between
the financial statements and this summary. </FONT></I></P>
<P align=justify><B><U>FORWARD-LOOKING STATEMENTS</U></B><B> </B></P>
<P align=justify>Certain statements included in this MD&amp;A constitute
&#147;forward-looking statements&#148; 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 &#147;may&#148;, &#147;will&#148;, &#147;expect&#148;, &#147;intend&#148;, &#147;estimate&#148;,
&#147;anticipate&#148;, &#147;plan&#148;, &#147;foresee&#148;, &#147;believe&#148; or &#147;continue&#148; or the negatives of
these terms or variations of them or similar terminology. We refer you to the
Company&#146;s filings with the Canadian securities regulatory authorities and the
U.S. Securities and Exchange Commission, as well as the &#147;Risks and
Uncertainties&#148; section and the risks described under the section &#147;Financial Risk
Management&#148; of the 2008 Annual MD&amp;A, as subsequently updated in this interim
MD&amp;A for a discussion of the various factors that may affect the Company&#146;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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.19
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_20></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Forward-looking information is inherently uncertain and 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>
<UL style="TEXT-ALIGN: justify">
  <LI>general economic conditions such as commodity prices, currency exchange
  rates, interest rates and other factors over which we have no control;
  <LI>the impact of economic and business conditions, industry trends and other
  external, political and social factors in the countries in which we operate;
  <LI>the intensity of competitive activity;
  <LI>changes in environmental, tax, trade, employment and other laws and
  regulations;
  <LI>our ability to implement our strategies and plans;
  <LI>our ability to complete and successfully integrate acquisitions;
  <LI>our reliance on a small number of significant customers;
  <LI>changes in consumer preferences, customer demand for our products and our
  ability to maintain customer relationships and grow our business;
  <LI>the fact that our customers do not commit to minimum quantity purchases;
  <LI>the seasonality of our business;
  <LI>our ability to attract and retain key personnel;
  <LI>our reliance on computerized information systems;
  <LI>changes in accounting policies and estimates; and
  <LI>disruption to manufacturing and distribution activities due to labour
  disruptions, bad weather, natural disasters and other unforeseen adverse
  events. </LI></UL>
<P align=justify>These factors may cause the Company&#146;s actual performance and
financial results in future periods to differ materially from any estimates or
projections of future performance or results expressed or implied by such
forward-looking statements. Forward-looking statements do not take into account
the effect that transactions or non-recurring or other special items announced
or occurring after the statements are made have on the Company&#146;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&#146;s
expectations regarding the Company&#146;s fiscal 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>February 11, 2009 </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.20
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5><body>
<!--$$/page=--><A name=page_1></A>
<P align=center><B>Gildan Activewear Inc.</B><BR><B>Interim Consolidated Balance
Sheets</B><BR>(in thousands of US dollars)</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%" nowrap><U>January 4, 2009</U> </TD>
    <TD align=left width="2%" nowrap>&nbsp;</TD>
    <TD align=left width="1%" nowrap>&nbsp;</TD>
    <TD align=right width="10%" nowrap><U>October 5, 2008</U> </TD>
    <TD align=left width="2%" nowrap>&nbsp;</TD>
    <TD align=left width="1%" nowrap>&nbsp;</TD>
    <TD align=right width="10%" nowrap><U>December 30, 2007</U> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(unaudited) </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(audited) </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(unaudited) </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(Recast-note 3</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">(Recast-note 3</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left>Current assets: </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="10%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Cash and cash equivalents </TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="10%" bgColor=#e6efff>&nbsp;14,377 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="10%" bgColor=#e6efff>&nbsp;12,357 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="10%" bgColor=#e6efff>&nbsp;13,598 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Accounts receivable </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">98,842 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">222,158 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">152,001 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Inventories (note 5) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>386,378 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>316,172 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>294,541 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Prepaid expenses and deposits </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">8,550 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">10,413 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">8,775 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Future income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>3,864 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">508,147 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">561,100 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">472,779 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Property, plant and equipment </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">435,230 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">436,516 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">413,303 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Intangible assets </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>59,154 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>59,954 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>65,663 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Other assets </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">14,996 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">17,277 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">18,377 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Assets held for sale (note 8) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>10,497 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>10,497 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>12,681 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Goodwill </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">6,709 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">6,709 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">- </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Future income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>8,751 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>9,283 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>10,489 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total assets </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>&nbsp;1,043,484 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>&nbsp;1,101,336 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>&nbsp;993,292 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Current liabilities: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Accounts payable and accrued liabilities </TD>
    <TD align=left width="1%">$</TD>
    <TD align=right width="10%">&nbsp;124,647 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">$</TD>
    <TD align=right width="10%">&nbsp;155,669 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">$</TD>
    <TD align=right width="10%">&nbsp;118,880 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Income taxes payable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>17,394 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>46,627 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>5,613 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Current portion of long-term debt </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">3,050
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">3,556
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">4,589
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>145,091 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>205,852 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>129,082 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Long-term debt </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>48,195 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>49,448 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>126,231 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Future income taxes </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">26,516 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">27,331 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">40,760 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Non-controlling interest in consolidated
      joint venture </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>6,773 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>7,162 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>7,223 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Contingencies (note 12) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shareholders' equity: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Share capital </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">90,389 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">89,377 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">88,463 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Contributed surplus </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>6,733 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>6,728 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>4,505 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Retained earnings </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">693,359</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">689,190 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="10%">570,780 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Accumulated other
      comprehensive income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>26,248 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>26,248 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"
    bgColor=#e6efff>26,248 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%">719,787</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%">715,438</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%">597,028</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%" bgcolor="#E6EFFF">816,909 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%" bgcolor="#E6EFFF">811,543 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%" bgcolor="#E6EFFF">689,996 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#FFFFFF>&nbsp; </TD>
    <TD width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD width="10%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD width="10%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD width="10%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD width="2%" bgColor=#FFFFFF>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#FFFFFF">Total liabilities and shareholders' equity </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%" bgcolor="#FFFFFF">$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="10%" bgcolor="#FFFFFF">&nbsp;1,043,484 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#FFFFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%" bgcolor="#FFFFFF">$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="10%" bgcolor="#FFFFFF">&nbsp;1,101,336 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#FFFFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%" bgcolor="#FFFFFF">$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="10%" bgcolor="#FFFFFF">&nbsp;993,292 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#FFFFFF">&nbsp;</TD></TR></TABLE>
<P align=left>See accompanying notes to interim consolidated financial
statements.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.21</FONT></P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_2></A>
<P align=center><B>Gildan Activewear Inc.<BR>Interim Consolidated
Statements of Earnings and Comprehensive Income<BR></B>(In thousands of US
dollars, except per share data)</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="27%" colSpan=4><B><I>Three months ended</I></B>
</TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><U>January 4, 2009</U> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><U>December 30, 2007</U> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(unaudited) </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(unaudited) </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%" nowrap>(Recast-notes 1 and 3</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net sales </TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="12%" bgColor=#e6efff>&nbsp;183,995 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="12%" bgColor=#e6efff>&nbsp;250,457 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Cost of sales </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">145,105 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">184,886 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>38,890 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>65,571 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Selling, general and administrative expenses </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">33,479 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">31,698 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Restructuring and other charges (note 8)
</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>925 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>823 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Operating income </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">4,486 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">33,050 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Financial expense, net (note 11(b)) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>189 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,739 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Non-controlling interest in consolidated joint venture </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(389</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">291
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Earnings before income taxes </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,686 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>30,020 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">337
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">2,080
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net earnings and comprehensive income </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>&nbsp;4,349 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>&nbsp;27,940 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Basic EPS (note 9) </TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="12%" bgColor=#e6efff>&nbsp;0.04 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>$</TD>
    <TD align=right width="12%" bgColor=#e6efff>&nbsp;0.23 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Diluted EPS (note 9) </TD>
    <TD align=left width="1%">$</TD>
    <TD align=right width="12%">&nbsp;0.04 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">$</TD>
    <TD align=right width="12%">&nbsp;0.23 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR></TABLE>
<P align=left>See accompanying notes to interim consolidated financial
statements.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.22</FONT></P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_3></A>
<P align=center><B>Gildan Activewear Inc.</B><BR><B>Interim Consolidated
Statements of Cash Flows</B><BR>(In thousands of US dollars)</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="27%" colSpan=4><B><I>Three months ended</I></B>
</TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><U>January 4, 2009</U> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><U>December 30, 2007</U> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(unaudited) </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(unaudited) </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(Recast-note 3</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash flows from (used in) operating
      activities: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Net earnings </TD>
    <TD align=left width="1%" >$</TD>
    <TD align=right width="12%">&nbsp;4,349 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >$</TD>
    <TD align=right width="12%">&nbsp;27,940 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Adjustments for: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Depreciation and amortization
      (note 10(b)) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">15,887 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">12,381 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Variation of
      depreciation included in inventories (note 10(b)) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(4,415</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,421</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restructuring
      charges related to assets held for sale and property, plant and equipment
    </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(289</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on disposal
      of assets held for sale and property, plant and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>21 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>59 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Stock-based compensation costs
    </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">747 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">678 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Future income
      taxes </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(178</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,235</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Non-controlling interest </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(389</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">291 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized net gain
      on foreign exchange and forward foreign exchange contracts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(1,224</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(239</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">14,798</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">38,165 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Changes in non-cash working
      capital balances: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Accounts receivable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">119,735 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">83,347 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Inventories </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(65,791</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(9,734</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Prepaid expenses and deposits
</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,863 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">554 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Accounts payable
      and accrued liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(30,768</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(11,506</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Income taxes payable </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(23,935</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">2,568
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>15,902 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>103,394 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash flows from (used in) financing
      activities: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Increase in amounts drawn under revolving
      long-term credit facility </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">71,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Decrease in bank indebtedness
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,261</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Increase in other long-term debt </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">36 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,561 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Repayment of other long-term
      debt </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,795</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,401</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Proceeds from the issuance of shares </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">270
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">276
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,489</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>70,175 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash flows from (used in) investing
      activities: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Purchase of property, plant and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(13,663</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(34,150</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Acquisition of V.I. Prewett
      &amp; Son, Inc. </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(126,819</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Restricted cash related to acquisition </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">939 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(10,000</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Proceeds on disposal of assets
      held for sale </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>212 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>421 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Net decrease in other assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">376
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">1,381
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(12,136</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(169,167</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Effect of exchange rate changes on cash and
      cash equivalents denominated in foreign currencies </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(257</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(54</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>) </TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net increase in cash and cash equivalents
      during the period </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,020 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,348 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash and cash equivalents, beginning of
      period </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>12,357 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>9,250 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash and cash equivalents, end of period
</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>&nbsp;14,377 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>$</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>&nbsp;13,598 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=left>See accompanying notes to interim consolidated financial
statements.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.23</FONT></P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<!--$$/page=--><A name=page_4></A>
<P align=center><B>Gildan Activewear Inc.<BR>Interim Consolidated
Statement of Shareholders' Equity <br>
Three months ended January 4, 2009 and
December 30, 2007<BR></B>(in thousands or thousands of US dollars)</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left rowSpan=2 valign="bottom">
    <p style="text-indent: -26; margin-left: 26"><BR></TD>
    <TD align=left width="1%" rowSpan=2 valign="bottom"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="17%" colSpan=4>Share capital </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Contributed <BR>surplus </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Accumulated other <BR>comprehensive income </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Retained <BR>earnings </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Total shareholders' <BR>equity </TD>
    <TD align=left width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium" valign="bottom"><BR></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%">Number </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; " vAlign=bottom align=center
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%">Amount </TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, September 30, 2007, as previously reported </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">120,419 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;88,061 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;3,953 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;26,248 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;545,388 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;663,650 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Cumulative effect of adopting a new accounting policy (note
      3) </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right
    width="7%" valign="bottom">(2,548</TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left width="2%" valign="bottom">) </TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right
    width="7%" valign="bottom">(2,548</TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left width="2%" valign="bottom">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, September 30, 2007, as recast </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">120,419 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">88,061 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">3,953 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">26,248 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">542,840 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">661,102 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Stock-based compensation related to stock options and
      Treasury restricted share units </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">678 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">678 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued under employee share purchase plan </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">2 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">52 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">52 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued pursuant to exercise of stock options </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">28 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">224 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">224 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued pursuant to exercise of Treasury restricted
      share units </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">8 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Ascribed value credited to share capital from exercise of
      Treasury restricted share units </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">126 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">(126</TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">) </TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Net earnings, recast (note 3) </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">27,940
    </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">27,940
    </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, December 30, 2007, as recast (unaudited) </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">120,457 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;88,463 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;4,505 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;26,248 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;570,780 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;689,996 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD></TR>
  <TR>
    <TD valign="bottom">
    <p style="text-indent: -26; margin-left: 26">&nbsp; </TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-top-style: none; border-top-width: medium" valign="bottom">&nbsp;</TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-top-style: none; border-top-width: medium" valign="bottom">&nbsp;</TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-top-style: none; border-top-width: medium" valign="bottom">&nbsp;</TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-top-style: none; border-top-width: medium" valign="bottom">&nbsp;</TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-top-style: none; border-top-width: medium" valign="bottom">&nbsp;</TD>
    <TD width="1%" valign="bottom">&nbsp;</TD>
    <TD width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">&nbsp; </TD>
    <TD width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">&nbsp; </TD>
    <TD align=left width="1%" rowSpan=2 valign="bottom"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="17%" colSpan=4>Share capital </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Contributed <BR>surplus </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Accumulated other <BR>comprehensive income </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%" rowSpan=2>Retained <BR>earnings </TD>
    <TD vAlign=bottom align=center width="2%" rowSpan=2 style="border-bottom-style: none; border-bottom-width: medium"><BR></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" rowSpan=2><BR></TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" vAlign=bottom align=center
    width="7%" rowSpan=2>Total shareholders' <BR>equity </TD>
    <TD align=left width="2%" rowSpan=2 style="border-style: none; border-width: medium" valign="bottom"><BR></TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%">Number </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; " vAlign=bottom align=center
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="7%">Amount </TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, October 5, 2008, as previously reported </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">120,536 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;89,377 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;6,728 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;26,248 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;689,980 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">$</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;812,333 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Cumulative effect of adopting a new accounting policy (note
      3) </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right
width="7%" valign="bottom">(790</TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left width="2%" valign="bottom">) </TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right
width="7%" valign="bottom">(790</TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left width="2%" valign="bottom">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, October 5, 2008, as recast </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">120,536 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">89,377 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">6,728 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">26,248 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">689,190 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">811,543 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Stock-based compensation related to stock options and
      Treasury restricted share units </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">747 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">747 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued under employee share purchase plan </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">10 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">265 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">265 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued pursuant to exercise of stock options </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">2 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">5 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">5 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Shares issued pursuant to exercise of Treasury restricted
      share units </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">81 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Ascribed value credited to share capital from exercise of
      Treasury restricted share units </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">742 </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">(742</TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">) </TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=left width="1%" style="border-left-style: none; border-left-width: medium" valign="bottom">&nbsp;</TD>
    <TD align=right width="7%" style="border-right-style: none; border-right-width: medium" valign="bottom">- </TD>
    <TD align=left width="2%" style="border-style: none; border-width: medium" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Net earnings </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">- </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">4,349
    </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-left-style:none; border-left-width:medium" align=left
    width="1%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 1px solid #000000; ; border-right-style:none; border-right-width:medium" align=right width="7%" bgcolor="#E6EFFF" valign="bottom">4,349
    </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" bgcolor="#E6EFFF" valign="bottom">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left valign="bottom">
    <p style="text-indent: -26; margin-left: 26">Balance, January 4, 2009 (unaudited) </TD>
    <TD align=left width="1%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">120,629 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;90,389 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;6,733 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;26,248 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;693,539 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-left-style:none; border-left-width:medium" align=left width="1%" valign="bottom">$</TD>
    <TD style="BORDER-BOTTOM: 3px double #000000; ; border-right-style:none; border-right-width:medium" align=right
      width="7%" valign="bottom">&nbsp;816,909 </TD>
    <TD style="BORDER-BOTTOM: medium none #000000; ; border-left-style:none; border-left-width:medium; border-right-style:none; border-right-width:medium; border-top-style:none; border-top-width:medium" align=left
    width="2%" valign="bottom">&nbsp;</TD></TR>
  </TABLE>
<p align="left">See accompanying notes to interim consolidated financial
statements.</p>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.24</FONT><BR>
</P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>

<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p align="justify"><u>NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS <br>
</u>(For the period ended January 4, 2009) <br>
(Tabular amounts in thousands or thousands of US dollars, except per share data
or unless otherwise noted) <br>
(unaudited) </p>
<p align="justify">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
statements. Accordingly, they do not include all of the information and
footnotes required by Canadian generally accepted accounting principles for
complete financial statements, and should be read in conjunction with the
Company&#146;s annual consolidated financial statements for the year ended October 5,
2008. </p>
<p align="justify">The Company's revenues and income are subject to seasonal
variations. Consequently, the results of operations for the first fiscal quarter
are traditionally not indicative of the results to be expected for the full
fiscal year. </p>
<p align="justify">All amounts in the attached notes are unaudited unless
specifically identified. </p>
<i><b>
<p align="justify">Statement of earnings classification: <br>
</b></i>Effective the first quarter of fiscal 2009, the Company changed certain
classifications of its Statement of Earnings and Comprehensive Income with
retrospective application to comparative figures presented for prior periods.
These new classifications align the results of operations by function and
incorporate presentation requirements under Canadian Institute of Chartered
Accountants (CICA) Handbook Section 3031, <i>Inventories</i>, which has been
adopted effective the first quarter of fiscal 2009. Pursuant to the requirements
of Section 3031, depreciation expense related to manufacturing activities is
included in Cost of sales. The remaining depreciation and amortization expense
has been reclassified to Selling, general and administrative expenses.
Depreciation and amortization expense is therefore no longer presented as a
separate caption on the Statement of Earnings and Comprehensive Income. In
addition, the Company reclassified certain other items in its Statement of
Earnings and Comprehensive Income. Outbound freight, previously classified
within Selling, general and administrative expenses, is now reported within Cost
of sales. Also, a new caption is now presented for Financial expenses and
income, which includes interest income and expenses, foreign exchange gains and
losses (including mark-to-market adjustments of forward foreign exchange
contracts), and other financial charges. Interest expense net of interest income
was previously reported as a separate caption, while foreign exchange gains and
losses (including mark-to-market adjustments of forward foreign exchange
contracts) were previously included in Cost of sales. Other financial charges
were previously reflected in Selling, general and administrative expenses. These
changes in classification have resulted in a decrease of $13.4 million and $0.9
million in Gross profit and Selling, general and administrative expenses,
respectively, compared to the amounts previously reported for the first quarter
of fiscal 2008. For the period ended December 30, 2007, the decrease of $13.4
million in Gross profit is due to reclassifications of $9.5 million of
depreciation and amortization expense, $3.6 million of outbound freight and $0.3
million of foreign exchange gains and other financial income. There has been no
impact on net earnings as a result of these changes in classification. </p>
<b>
<p align="justify">2. Significant accounting policies: </p>
</b>
<p ALIGN="JUSTIFY">Except for the adoption of the new accounting standards
described in Note 3 below and the Statement of earnings classification changes
in Note 1 above, 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 for the
year ended October 5, 2008. </p>
</font><b><font SIZE="2">
<p align="justify">3. Adoption of new accounting standards: </p>
<i>
<p align="justify">Inventories: </i></font></b><font SIZE="2"><br>
Effective the commencement of its 2009 fiscal year, the Company adopted CICA
Handbook Section 3031, <i>Inventories</i>, which replaces Section 3030, <i>
Inventories,</i> and harmonizes the Canadian standards related to inventories
with International Financial Reporting Standards (IFRS). This Section, which was
issued in June 2007, provides changes to the measurement of, and more extensive
guidance on, the determination of cost, including allocation of overhead;
narrows the permitted cost formulas; requires impairment testing; clarifies that
major spare parts not in use should be included in property, plant and
equipment; and expands the disclosure requirements to increase transparency. The
Company compared the requirements of this new Section with its current
measurement and determination of costs and concluded that the new Section did
not have a significant impact on the results of operations.
</font>
<font FACE="Times New Roman PSMT">
The Company previously included and will continue to include
the amount of depreciation related to manufacturing activities as a component of
the cost of inventories. However, the new Section requires depreciation expense
related to inventories which have been sold to be presented in Cost of sales. As
a result, effective the first quarter of fiscal 2009, depreciation expense
related to manufacturing activities has been reclassified to Cost of sales.
</font><font SIZE="2">&nbsp;See the section, Statement of earnings
classification, in Note 1 above and Note 5 for the new disclosure requirements
related to the adoption of Section 3031.
</font> </p>
<font SIZE="2">
<i><b>
<p align="justify">General Standards of Financial Statement Presentation: <br>
</b></i>Effective the commencement of its 2009 fiscal year, the Company adopted
the amendment of CICA Handbook Section 1400, <i>General Standards of Financial
Statement Presentation</i>, which is effective for interim periods beginning on
or after October 1, 2008 and which includes requirements to assess and disclose
the Company&#146;s ability to continue as a going concern. The adoption of the
amended Section did not have an impact on the interim consolidated financial
statements of the Company. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.25</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
</font><b><font SIZE="2">
<p align="justify">3. Adoption of new accounting standards (continued): </p>
<i>
<p align="justify">Goodwill and intangible assets: </i></font></b>
<font SIZE="2"><br>
In February 2008, the CICA issued Handbook Section 3064, <i>Goodwill and
Intangible Assets</i>, replacing Section 3062, <i>Goodwill and Other Intangible
Assets</i>, and Section 3450, <i>Research and Development Costs</i>. Section
3064 establishes revised standards for the recognition, measurement,
presentation and disclosure of goodwill and intangible assets. The new Section
also provides guidance for the treatment of preproduction and start-up costs and
requires that these costs be expensed as incurred. This Section applies to
interim and annual financial statements relating to the Company&#146;s fiscal year
beginning on October 6, 2008 and has been adopted on a retrospective basis
effective from the first quarter of fiscal 2009. </p>
<p ALIGN="JUSTIFY">Prior to the adoption of Section 3064, the Company deferred
and amortized plant start-up costs on a straight-line basis over two years. The
impact of adopting this Section, on a retrospective basis, is an increase of
$0.5 million in net earnings for the three-month period ended December 30, 2007,
with no change in the reported basic and diluted earnings per share, and a
decrease of $0.8 million and $2.5 million in shareholders&#146; equity at October 5,
2008 and September 30, 2007, respectively. </p>
</font><b><font SIZE="2">
<p align="justify">4. New Accounting Pronouncements: </p>
<i>
<p align="justify">Credit risk and the fair value of financial assets and
financial liabilities: </i></font></b><font SIZE="2"><br>
On January 20, 2009, the Emerging Issues Committee (EIC) of the Canadian
Accounting Standards Board (AcSB) issued EIC Abstract 173, <i>Credit Risk and
Fair Value of Financial Assets and Financial Liabilities</i>, which establishes
that an entity&#146;s own credit risk and the credit risk of the counterparty should
be taken into account in determining the fair value of financial assets and
financial liabilities, including derivative instruments. EIC 173 should be
applied retrospectively without restatement of prior years to all financial
assets and liabilities measured at fair value in interim and annual financial
statements for periods ending on or after January 20, 2009 and is applicable to
the Company for its second quarter of fiscal 2009 with retrospective
application, if any, to the beginning of its current fiscal year. The Company is
currently assessing the impact of EIC 173 on its consolidated financial
statements. </font></p>
<b><font SIZE="2"><i>
<p align="justify">Business combinations:</i> </font></b><font SIZE="2"><br>
In January 2009, the CICA issued Handbook Section 1582, <i>Business Combinations</i>,
which replaces Section 1581, <i>Business Combinations</i>, and provides the
equivalent to IFRS 3, <i>Business Combinations</i> (January 2008). The new
Section expands the definition of a business subject to an acquisition and
establishes significant new guidance on the measurement of consideration given,
and the recognition and measurement of assets acquired and liabilities assumed
in a business combination. The new Section requires that all business
acquisitions be measured at the full fair value of the acquired entity at the
acquisition date even if the business combination is achieved in stages, or if
less than 100 percent of the equity interest in the acquiree is owned at the
acquisition date. The measurement of equity consideration given in a business
combination will no longer be based on the average of the fair value of the
shares a few days before and after the day the terms and conditions have been
agreed to and the acquisition announced, but rather at the acquisition date.
Subsequent changes in fair value of contingent consideration classified as a
liability will be recognized in earnings and not as an adjustment to the
purchase price. Restructuring and other direct costs of a business combination
are no longer considered part of the acquisition accounting. Instead, such costs
will be expensed as incurred, unless they constitute the costs associated with
issuing debt or equity securities. The Section applies prospectively to business
combinations for which the acquisition date is on or after the beginning of the
first annual reporting period beginning on or after January 1, 2011. Earlier
adoption is permitted. This new Section will only have an impact on our
consolidated financial statements for future acquisitions that will be made in
periods subsequent to the date of adoption. </p>
</font><b><font SIZE="2"><i>
<p align="justify">Consolidated financial statements and non-controlling
interests:</i> </font></b><font SIZE="2"><br>
In January 2009, the CICA issued Handbook Section 1601, <i>Consolidated
Financial Statements,</i> and Handbook Section 1602, <i>Non-Controlling
Interests</i>, which together replace Section 1600, <i>Consolidated Financial
Statements</i>. These two Sections are the equivalent to the corresponding
provisions of International Accounting Standard 27, <i>Consolidated and Separate
Financial Statements (January 2008)</i>. Section 1602 applies to the accounting
for non-controlling interests and transactions with non-controlling interest
holders in consolidated financial statements. The new Sections require that, for
each business combination, the acquirer measure any non-controlling interest in
the acquiree either at fair value or at the non-controlling interest's
proportionate share of the acquiree's identifiable net assets. The new Sections
also require non-controlling interest to be presented as a separate component of
shareholders' equity. Under Section 1602, non-controlling interest in income is
not deducted in arriving at consolidated net income or other comprehensive
income. Rather, net income and each component of other comprehensive income are
allocated to the controlling and non-controlling interests based on relative
ownership interests. These Sections apply to interim and annual consolidated
financial statements relating to fiscal years beginning on or after January 1,
2011, and should be adopted concurrently with Section 1582. The Company is
currently assessing the future impact of these new Sections on its consolidated
financial statements.
</font> </p>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.26</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
</font><b><font SIZE="2">
<p>4. New Accounting Pronouncements (continued) </p>
<i>
<p>International Financial Reporting Standards:</i></font></b><font SIZE="2">
<br>
In February 2008, Canada&#146;s Accounting Standards Board (AcSB) confirmed that IFRS,
as issued by the International Accounting Standards Board, will replace Canadian
generally accepted accounting principles for publicly accountable enterprises
effective for fiscal years beginning on or after January 1, 2011. As a result,
the Company will be required to change over to IFRS for its fiscal 2012 interim
and annual financial statements with comparative information for fiscal 2011.
</p>
<b>
<p>5. Inventories: </p>
</b>
<p>Inventories were comprised of the following: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">October 5, 2008</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Raw materials and spare parts inventories</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">59,449</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">59,742</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">47,495</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">Work in process</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">30,639</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">29,086</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">32,956</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Finished goods</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">296,290</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">227,344</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">214,090</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">Total</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">386,378</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">316,172</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">294,541</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">The amount of inventory recognized as an expense and included
in Cost of sales for the three-month periods ended January 4, 2009 and December
30, 2007 was $142.9 million and $181.3 million, respectively, which included an
expense of $0.5 million and $1.7 million, respectively, related to the
write-down of slow-moving inventory. </p>
<b>
<p>6. Stock-based compensation: </p>
</b>
<p ALIGN="JUSTIFY">The Company&#146;s Long Term Incentive Plan (the &quot;LTIP&quot;) includes
stock options and restricted share units. The LTIP allows the Board of Directors
to grant stock options, dilutive restricted share units (&quot;Treasury RSUs&quot;) and
non-dilutive restricted share units (&quot;Non-Treasury RSUs&quot;) to officers and other
key employees of the Company and its subsidiaries. </p>
<p>Changes in outstanding stock options were as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="30%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">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">
    <font SIZE="2">
    <p style="margin-right: 4">Number</font></td>
    <td WIDTH="30%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">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">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="30%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">(in Canadian dollars)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6EFFF"><font SIZE="2">Options outstanding, October 5, 2008</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">878</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">14.23</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">233</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">23.49</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6EFFF"><font SIZE="2">Exercised</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(2)</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">4.32</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">(18)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">30.96</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">Options outstanding, January 4, 2009</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">1,091</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">15.94</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">As at January 4, 2009, 657 of the outstanding options were
exercisable at the weighted average price of CA$7.72. Based on the Black-Scholes
option pricing model, the grant date weighted average fair value of the options
granted during the first quarter ended January 4, 2009 was CA$9.99. </p>
<p>Changes in outstanding Treasury RSUs were as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="29%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Weighted average</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Number</font></td>
    <td WIDTH="29%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">fair value per unit</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Treasury RSUs outstanding, October 5, 2008</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">979</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">17.43</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">50</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">16.98</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6EFFF"><font SIZE="2">Settled through the issuance of common shares</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(81)</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">9.21</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">(38)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">27.70</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">Treasury RSUs outstanding, January 4, 2009</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">910</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">17.70</font></td>
  </tr>
</table>
<font SIZE="2">
<p>As at January 4, 2009, none of the awarded and outstanding Treasury RSUs were
vested. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.27</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p align="justify">6. Stock-based compensation (continued): </p>
</b>
<p ALIGN="JUSTIFY">The compensation expense recorded for the three-month periods
ended January 4, 2009 and December 30, 2007, respectively, was $0.7 million and
$0.7 million, in respect of the Treasury RSUs and stock options. The counterpart
has been recorded as contributed surplus. When the shares are issued to the
employees, the amounts previously credited to contributed surplus are
reclassified to share capital. </p>
<p align="justify">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="85%" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">Number</font></td>
  </tr>
  <tr>
    <td WIDTH="85%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Non-Treasury RSUs outstanding, October 5, 2008</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">99</font></td>
  </tr>
  <tr>
    <td WIDTH="85%"><font SIZE="2">Granted</font></td>
    <td WIDTH="15%" align="right"><font SIZE="2">
    <p style="margin-right: 4">106</font></td>
  </tr>
  <tr>
    <td WIDTH="85%" bgcolor="#E6EFFF"><font SIZE="2">Settled</font></td>
    <td WIDTH="15%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(1)</font></td>
  </tr>
  <tr>
    <td WIDTH="85%" 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">(7)</font></td>
  </tr>
  <tr>
    <td WIDTH="85%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">Non-Treasury RSUs outstanding, January 4, 2009</font></td>
    <td WIDTH="15%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">197</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 will be
based on the Company&#146;s stock price at the vesting date. As of January 4, 2009,
the weighted average fair value per non-Treasury RSU was $12.20. No common
shares are issued from treasury under such awards and they are therefore
non-dilutive. As of January 4, 2009, none of the awarded and outstanding
non-Treasury RSUs were vested. </p>
<p ALIGN="JUSTIFY">The compensation  expense (recovery) recorded for the
three-month periods ended January 4, 2009 and December 30, 2007, respectively,
was $(0.2) million and $0.3 million, in respect of the non-Treasury RSUs. The
counterpart has been recorded in Accounts payable and accrued liabilities. </p>
<b>
<p>7. Guarantees: </p>
</b>
<p ALIGN="JUSTIFY">The Company, and some 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 some of its
subsidiaries do not perform their contractual obligations. As at January 4,
2009, the maximum potential liability under these guarantees was $9.9 million,
of which $3.9 million was for surety bonds and $6.0 million was for corporate
guarantees and standby letters of credit. The standby letters of credit mature
at various dates up to fiscal 2010, 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 January 4, 2009, 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>
<b>
<p>8. Restructuring and other charges and assets held for sale: </p>
</b>
<p ALIGN="JUSTIFY">In fiscal 2006 and 2007, the Company announced the closure,
relocation and consolidation of manufacturing and distribution facilities in
Canada, the United States and Mexico, as well as the relocation of its corporate
office. In addition, in the third quarter of fiscal 2008, the Company announced
the planned consolidation of its Haiti sewing operation to be finalized in the
first half of fiscal 2009. The costs incurred in connection with these
initiatives have been recorded as restructuring and other charges. </p>
<p ALIGN="JUSTIFY">Restructuring charges of $0.9 million in the first quarter of
fiscal 2009 include $0.3 million of additional severance relating to the
closures noted above, and $0.6 million of exit costs, mainly for the closure of
the Haiti sewing facility. Restructuring charges of $0.8 million in the first
quarter of fiscal 2008 were composed of $1.1 million of other exit costs,
primarily related to the closures noted above, including carrying and
dismantling costs associated with assets held for sale less a gain of $0.3
million recognized on the disposal of assets held for sale. </p>
<p ALIGN="JUSTIFY">Assets held for sale of $10.5 million as at January 4, 2009
(October 5, 2008 - $10.5 million; December 30, 2007 - $12.7 million) include
property, plant and equipment at these various locations. The Company expects to
incur additional carrying costs relating to these assets, which will be
accounted for as restructuring charges as incurred during fiscal 2009, until all
property, plant and equipment related to the closures are disposed of. Any gains
or losses on the disposition of the assets held for sale will also be accounted
for as restructuring charges as incurred. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.28</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>9. Earnings per share: </p>
</b>
<p>A reconciliation between basic and diluted earnings per share is as follows:
</p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="46%" colspan="4" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right"><font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">Basic earnings per share:</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">
    <p style="margin-left: 5%">Basic weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">120,573</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">120,428</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 5%">Basic earnings per share</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">0.23</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Diluted earnings per share:</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="70%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Basic weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">120,573</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">120,428</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 5%">Plus impact of stock options and Treasury RSUs</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">835</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1,228</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 5%">Diluted weighted average number of common shares
    outstanding</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">121,408</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">121,656</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 5%">Diluted earnings per share</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">0.04</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">0.23</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">Excluded from the above calculation for the three months
ended January 4, 2009 are 467 stock options and 189 Treasury RSUs, which were
deemed to be anti-dilutive. All stock options and Treasury RSUs outstanding for
the three months ended December 30, 2007 were dilutive. </p>
<b>
<p>10. Other information: </p>
</b>
<p>(a) </p>
<p style="margin-left: 3%; margin-top: -25.5pt">Supplemental cash flow
disclosure<b>: </p>
</b></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: 2">&nbsp;</td>
    <td WIDTH="58%" COLSPAN="4" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6EFFF"><font SIZE="2">Cash paid during the period for:</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">
    <p style="margin-left: 5%">Interest</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">947</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">2,826</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 5%">Income taxes</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">24,014</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">917</font></td>
  </tr>
</table>
<p>&nbsp;</p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">October 5, 2008</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" colspan="2" align="right"><font SIZE="2">
    <p style="margin-right: 4">(audited)</font></td>
    <td WIDTH="27%" align="right" colspan="2">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">Balance of non-cash transactions:</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="margin-left: 5%">Additions to property, plant and equipment
    included in</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="55%"><font SIZE="2">
    <p style="margin-left: 7%">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,823</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,720</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,662</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Ascribed value credited to share capital from
    issuance of</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 7%">Treasury RSUs</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">742</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">190</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">126</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="margin-left: 5%">Proceeds on disposal of long-lived assets in
    Other assets</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,236</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,382</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,723</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Proceeds on disposal of long-lived assets in
    Accounts</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1,050</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 7%">receivable</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="margin-left: 5%">Business acquisition in Accounts payable and
    accrued</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,196</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,196</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="margin-left: 7%">liabilities</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="55%" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">Cash and cash equivalents consist of:</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%"><font SIZE="2">
    <p style="margin-left: 5%">Cash balances with banks</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10,130</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">8,068</font></td>
    <td WIDTH="7%" align="right"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">6,495</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Short-term investments, bearing interest at rates
    up to 0.3% at</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 7%">January 4, 2009, up to 2.22% at October 5, 2008
    and up to</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 7%">4.5% at December 30, 2007</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">4,247</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">4,289</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">7,103</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">14,377</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">12,357</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">13,598</font></td>
  </tr>
</table>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.29</FONT></P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>10. Other information (continued): </p>
</b>
<p>(b) </p>
<p style="margin-left: 3%; margin-top: -25.5pt">Depreciation and amortization<b>:
</p>
</b></font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111" height="267">
  <tr>
    <td WIDTH="55%" height="17" style="border-top-style: solid; border-top-width: 2">
    </td>
    <td WIDTH="45%" colspan="4" height="17" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19" style="border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="15" bgcolor="#E6EFFF"><font SIZE="2">
    <p>Depreciation and amortization of
    property, plant and equipment and intangible assets</font></td>
    <td WIDTH="7%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">15,887</font></td>
    <td WIDTH="7%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">12,381</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19"><font SIZE="2">Adjustment for the variation of
    depreciation of property, plant and equipment</font></td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-left: 2%">included in inventories at the beginning and end
    of the period</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(4,415)</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">(1,421)</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Depreciation and amortization included in the interim
    consolidated statements</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" height="15" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 2%">of earnings and comprehensive income</font></td>
    <td WIDTH="7%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4"><font size="2">11,472</font></td>
    <td WIDTH="7%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">10,960</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19"><font SIZE="2">Consists of:</font></td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" height="15" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Depreciation of property, plant and equipment</font></td>
    <td WIDTH="7%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4"><font size="2">10,550</font></td>
    <td WIDTH="7%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">10,211</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19"><font SIZE="2">
    <p style="margin-left: 5%">Amortization of intangible assets</font></td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right"><font SIZE="2">
    <p style="margin-right: 4">800</font></td>
    <td WIDTH="7%" height="19" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right"><font SIZE="2">
    <p style="margin-right: 4">737</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 5%">Amortization of deferred financing costs and
    other</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">122</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">12</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" height="19" style="border-top-style: solid; border-top-width: 1">
    <font SIZE="2">
    <p style="margin-left: 5%">Depreciation and amortization included in the
    interim consolidated</font></td>
    <td WIDTH="7%" height="19" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" height="19" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" height="19" align="right" style="border-top-style: solid; border-top-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" height="15" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-left: 7%">statements of earnings and comprehensive income</font></td>
    <td WIDTH="7%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4"><font size="2">11,472</font></td>
    <td WIDTH="7%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" height="15" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">10,960</font></td>
  </tr>
</table>
<font SIZE="2">
<p ALIGN="JUSTIFY">(c) </p>
<p ALIGN="JUSTIFY" style="margin-left: 3%; margin-top: -25.5pt">The Company
recorded bad debt expense of $1.8 million and nil for the three-month periods
ended January 4, 2009 and December 30, 2007, respectively. Bad debt expense is
included in Selling, general and administrative expenses in the interim
consolidated statements of earnings and comprehensive income. </p>
<p ALIGN="JUSTIFY">(d) </p>
<p ALIGN="JUSTIFY" style="margin-left: 3%; margin-top: -25.5pt">The Company
expensed $2.0 million and $1.4 million in Cost of sales for the three months
ended January 4, 2009 and December 30, 2007, respectively, representing
management&#146;s best estimate of the cost of statutory severance and pre-notice
benefit obligations relating to employees located in the Caribbean Basin and
Central America. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.30</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>11. Financial instruments: </p>
</b>
<p ALIGN="JUSTIFY">Disclosures relating to exposure to risks, in particular
credit risk, liquidity risk, foreign currency risk and interest rate risk, are
included in the section entitled &quot;Financial Risk Management&quot; of the Management&#146;s
Discussion and Analysis of the Company&#146;s operations, performance and financial
condition as at and for the three months ended January 4, 2009, which is
included in the Gildan Q1 2009 Quarterly Report to Shareholders along with these
interim consolidated financial statements. Accordingly, these disclosures are
incorporated into these interim consolidated financial statements by
cross-reference. </p>
<p>(a) </p>
<p style="margin-left: 3%; margin-top: -25.5pt">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 sheet, are as follows: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="40%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="30%" colspan="4" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="30%" colspan="4" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">October 5, 2008</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">Carrying</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">Fair</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">Carrying</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">Fair</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">amount</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">value</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">amount</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">value</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2"><b>Financial assets</b></font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Available-for-sale financial assets:</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Cash and cash equivalents</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">14,377</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">14,377</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">12,357</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">12,357</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">Loans and receivables:</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Accounts receivable - trade</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">84,171</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">84,171</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">206,276</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">206,276</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 5%">Accounts receivable - other</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">14,671</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">14,671</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">15,882</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">15,882</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Long-term receivable included in Other assets</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1,623</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1,623</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1,748</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1,748</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 5%">Restricted cash related to Prewett acquisition</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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">
    <p style="margin-left: 7%">included in Other assets</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">9,061</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">9,061</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10,000</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">10,000</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2">
    <p>Forward foreign exchange contracts included
    in Other assets</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">232</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">232</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">929</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">929</font></td>
  </tr>
  <tr>
    <td WIDTH="40%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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"><b>Financial liabilities</b></font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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%" bgcolor="#E6EFFF"><font SIZE="2">Other financial liabilities:</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 5%">Accounts payable and accrued liabilities</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">122,503</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">122,503</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">155,669</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">155,669</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 5%">Long-term debt - bearing interest at variable
    rates:</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 10%">Revolving long-term credit facility</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">45,000</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">45,000</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">45,000</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">45,000</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-left: 10%">Other long-term debt</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">5,195</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">5,195</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">6,319</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">6,319</font></td>
  </tr>
  <tr>
    <td WIDTH="40%"><font SIZE="2">
    <p style="margin-left: 5%">Long-term debt - bearing interest at fixed rates</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,050</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,050</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,685</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,685</font></td>
  </tr>
  <tr>
    <td WIDTH="40%" bgcolor="#E6EFFF"><font SIZE="2">Forward foreign exchange contracts included
    in Accounts</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="40%" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-left: 2%">payable and accrued liabilities</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">2,144</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">2,144</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">-</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">-</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&#146;s
interest-bearing financial liabilities also approximate their respective
carrying amounts. The fair value of forward foreign exchange contracts was
determined using observable market inputs. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.31</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>11. Financial instruments (continued): </p>
</b>
<p>(b) </p>
<p style="margin-left: 3%; margin-top: -25.5pt">Financial expense, net: </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: 2">&nbsp;</td>
    <td WIDTH="60%" colspan="4" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="18%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="42%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Interest expense (i)</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">930</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">2,794</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Bank and other financial charges</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">239</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right"><font SIZE="2">
    <p style="margin-right: 4">262</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Foreign exchange gain (ii)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">(980)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="9%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">(317)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">189</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="9%" 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">2,739</font></td>
  </tr>
</table>
<font SIZE="2">
<p>(i) Interest expense: </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: 2">&nbsp;</td>
    <td WIDTH="52%" colspan="4" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="24%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="28%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Interest expense on long-term indebtedness</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">883</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">2,955</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Interest expense on short-term indebtedness</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">71</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">15</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" bgcolor="#E6EFFF"><font SIZE="2">Interest income on available-for-sale
    financial assets</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(20)</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(180)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Interest income on loans and receivables</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">(20)</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">(20)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Other interest expense</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">16</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">24</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">930</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">2,794</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&#146;s long-term receivable included in Other assets.
</p>
<p>(ii) Foreign exchange gain: </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: 2">&nbsp;</td>
    <td WIDTH="42%" colspan="4" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="15%" COLSPAN="2" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Loss (gain) relating to financial assets and liabilities,
    including income taxes payable</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">(3,281)</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">524</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font SIZE="2">Unrealized loss (gain) relating to the
    mark-to-market value of forward foreign exchange contracts</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">2,842</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">(848)</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Realized loss (gain) relating to forward foreign exchange
    contracts</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">(541)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">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">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(980)</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(317)</font></td>
  </tr>
</table>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.32</FONT></P>

<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>11. Financial instruments (continued): </p>
</b>
<p>(c) </p>
<p style="margin-left: 3%; margin-top: -25.5pt">Forward foreign exchange
contracts: </p>
<p>The following table summarizes the Company&#146;s derivative financial instruments
relating to commitments to buy and sell foreign currencies through forward
foreign exchange contracts as at January 4, 2009 and October 5, 2008: </p>
</font>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="13%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Notional foreign</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Average</font></td>
    <td WIDTH="10%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Notional US</font></td>
    <td WIDTH="7%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="27%" style="border-top-style: solid; border-top-width: 2" colspan="3">
    <font SIZE="2">
    <p align="center">Carrying and fair value</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">January 4, 2009</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Maturity</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">currency amount</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">exchange rate</font></td>
    <td WIDTH="15%" colspan="2" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">equivalent</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Asset</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Liability</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" bgcolor="#E6EFFF"><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">22,726</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">0.8856</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">20,126</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">(1,422)</font></td>
  </tr>
  <tr>
    <td WIDTH="13%">&nbsp;</td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">6-12 months</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">24,420</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0.8546</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">20,868</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">4</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">(722)</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">2,650</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">1.4743</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">3,907</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">228</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">44,901</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">232</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">(2,144)</font></td>
  </tr>
</table>
<p>&nbsp;</p>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="13%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Notional foreign</font></td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Average</font></td>
    <td WIDTH="10%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Notional US</font></td>
    <td WIDTH="7%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="34%" COLSPAN="3" style="border-top-style: solid; border-top-width: 2">
    <font SIZE="2">
    <p align="center">Carrying and fair value</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">October 5, 2008</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Maturity</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">currency amount</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">exchange rate</font></td>
    <td WIDTH="15%" colspan="2" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">equivalent</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Asset</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <font SIZE="2">
    <p style="margin-right: 4">Liability</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" bgcolor="#E6EFFF"><font SIZE="2">Buy CAD/Sell USD</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">5,483</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">0.9302</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">5,100</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="13%"><font SIZE="2">Buy EUR/Sell GPB</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">962</font></td>
    <td WIDTH="13%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1.3740</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">1,322</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" bgcolor="#E6EFFF"><font SIZE="2">Sell EUR/Buy USD</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">5,650</font></td>
    <td WIDTH="13%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">1.4591</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">8,244</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">472</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">Sell GBP/Buy USD</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">0-6 months</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">2,951</font></td>
    <td WIDTH="13%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">1.9177</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">5,659</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">457</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
  <tr>
    <td WIDTH="13%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="13%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">20,325</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">929</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font SIZE="2">
    <p style="margin-right: 4">&#150;</font></td>
  </tr>
</table>
<font SIZE="2"><b>
<p>12. 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 have been consolidated, and a consolidated amended complaint has been
filed. 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&#146;s common shares between August 2, 2007 and April 29, 2008 and allege,
among other things, that the defendants misrepresented the Company&#146;s financial
condition and its financial prospects in its financial guidance concerning the
2008 fiscal year, which was 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&#146;s <i>Securities Act </i>and an amended complaint along with
affidavit evidence for leave to pursue such statutory liability claims and class
certification have been filed. 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>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.33</FONT></P>

  <HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black noShade SIZE=5>
<p><img border="0" src="gil_no2.jpg" width="90" height="25"></p>
<font size="2">
<p align="right">NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS </p>
<b>
<p>13. Segmented information: </p>
</b>
<p>The Company manufactures and sells activewear, socks and underwear. The
Company operates in one business segment, being high-volume, basic, frequently
replenished, non-fashion apparel. </p>
<p ALIGN="JUSTIFY">The Company has two customers accounting for at least 10% of
total net sales. For the three-month period ended January 4, 2009, Customer A
accounted for 24.6% of total net sales and Customer B accounted for 23.5%. For
the three-month period ended December 30, 2007, Customer A accounted for 21.2%
of total net sales and Customer B accounted for 23.3%. </p>
<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: 2">&nbsp;</td>
    <td WIDTH="7%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="22%" COLSPAN="3" style="border-top-style: solid; border-top-width: 2">
    <font size="2">
    <p align="center">Three months ended</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="15%" COLSPAN="2" align="right"><font size="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="28%" COLSPAN="2" align="right"><font size="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">Net sales were derived from customers located in the
    following geographic areas:</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="70%" bgcolor="#E6EFFF"><font size="2">United States</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">169,630</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">229,709</font></td>
  </tr>
  <tr>
    <td WIDTH="70%"><font size="2">Canada</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font size="2">
    <p style="margin-right: 4">4,724</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font size="2">
    <p style="margin-right: 4">9,936</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">Europe and other</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">9,641</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">10,812</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">183,995</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">250,457</font></td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="70%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">Net sales by major product group:</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="70%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="70%" bgcolor="#E6EFFF"><font size="2">Activewear and underwear</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">115,843</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">168,448</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">Socks</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">68,152</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1">
    <font size="2">
    <p style="margin-right: 4">82,009</font></td>
  </tr>
  <tr>
    <td WIDTH="70%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">183,995</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">250,457</font></td>
  </tr>
</table>
<table CELLSPACING="0" BORDER="0" WIDTH="100%" cellpadding="0" style="border-collapse: collapse" bordercolor="#111111">
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="13%" COLSPAN="2">&nbsp;</td>
    <td WIDTH="12%" COLSPAN="2">&nbsp;</td>
    <td WIDTH="29%" COLSPAN="2">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 2">&nbsp;</td>
    <td WIDTH="13%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font size="2">
    <p style="margin-right: 4">January 4, 2009</font></td>
    <td WIDTH="12%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font size="2">
    <p style="margin-right: 4">October 5, 2008</font></td>
    <td WIDTH="29%" COLSPAN="2" align="right" style="border-top-style: solid; border-top-width: 2">
    <font size="2">
    <p style="margin-right: 4">December 30, 2007</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">Property, plant and equipment by geographic area are as
    follows:</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="15%" align="right" colspan="2" style="border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">(audited)</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 2">
    <p style="margin-right: 4">&nbsp;</td>
  </tr>
  <tr>
    <td WIDTH="55%">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="7%" 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="55%" bgcolor="#E6EFFF"><font size="2">Caribbean Basin and Central America</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">327,620</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">325,670</font></td>
    <td WIDTH="7%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" bgcolor="#E6EFFF"><font size="2">
    <p style="margin-right: 4">315,079</font></td>
  </tr>
  <tr>
    <td WIDTH="55%"><font size="2">United States</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font size="2">
    <p style="margin-right: 4">80,378</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font size="2">
    <p style="margin-right: 4">83,264</font></td>
    <td WIDTH="7%" align="right">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right"><font size="2">
    <p style="margin-right: 4">83,573</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">Canada and other</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">27,232</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">27,582</font></td>
    <td WIDTH="7%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <p style="margin-right: 4">&nbsp;</td>
    <td WIDTH="8%" align="right" style="border-bottom-style: solid; border-bottom-width: 1" bgcolor="#E6EFFF">
    <font size="2">
    <p style="margin-right: 4">14,651</font></td>
  </tr>
  <tr>
    <td WIDTH="55%" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">&nbsp;</td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" 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">435,230</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">436,516</font></td>
    <td WIDTH="7%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">$</font></td>
    <td WIDTH="8%" align="right" style="border-top-style: solid; border-top-width: 1; border-bottom-style: solid; border-bottom-width: 2">
    <font size="2">
    <p style="margin-right: 4">413,303</font></td>
  </tr>
</table>
<p>Goodwill and intangible assets relate to acquisitions located in the United
States. </p>
</font>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.34</FONT></P>

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<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>exh992.htm
<TEXT>


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<HEAD>
   <TITLE> Gildan Activewear Inc: Exhibit 99.2 - Prepared by TNT Filings Inc.</TITLE>

</HEAD>

<BODY style="font-size:10pt;">

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<!--$$/page=--><A name=page_1></A>
<P align=center><IMG src="mdax1x1.jpg" border=0 width="244" height="89"> </P>
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<BR>
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  <TR vAlign=top>
    <TD align=right nowrap><B>MD&amp;A:</B> </TD>
    <TD align=left width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Our Business </TD>
    <TD align=right width="15%">2 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Strategy and Objectives </TD>
    <TD align=right width="15%">4 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Operating Results </TD>
    <TD align=right width="15%">5 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Financial Condition </TD>
    <TD align=right width="15%">8 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Cash Flows </TD>
    <TD align=right width="15%">9 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Liquidity and Capital Resources </TD>
    <TD align=right width="15%">10 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Legal Proceedings </TD>
    <TD align=right width="15%">11 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Outlook </TD>
    <TD align=right width="15%">12 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Financial Risk Management </TD>
    <TD align=right width="15%">12 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Critical Accounting Estimates </TD>
    <TD align=right width="15%">15 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Adoption of New Accounting Standards </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Future Accounting Standards </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Related Party Transactions </TD>
    <TD align=right width="15%">16 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Internal Control Over Financial Reporting </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Risks and Uncertainties </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Definition and Reconciliation of Non-GAAP Measures </TD>
    <TD align=right width="15%">17 </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap>Forward-Looking Statements </TD>
    <TD align=right width="15%">19 </TD></TR>
  <TR>
    <TD nowrap>&nbsp; </TD>
    <TD width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap><B>Interim Consolidated Financial Statements</B> </TD>
    <TD align=right width="15%">21 </TD></TR>
  <TR>
    <TD nowrap>&nbsp; </TD>
    <TD width="15%">&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD align=right nowrap><B>Notes to Interim Consolidated Financial Statements</B>
    </TD>
    <TD align=right width="15%">25 </TD></TR></TABLE></center>
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<BR>
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<P align=right><FONT size=2><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND
ANALYSIS</FONT></FONT></P>
<P align=justify>This Management&#146;s Discussion and Analysis (MD&amp;A) comments
on Gildan&#146;s operations, performance and financial condition as at and for the
three months ended January 4, 2009, compared to the corresponding period 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 MD&amp;A should be read together with
the unaudited interim consolidated financial statements as at and for the three
months ended January 4, 2009, and the related notes, and with our MD&amp;A for
the year ended October 5, 2008 (2008 Annual MD&amp;A) which is part of the
fiscal 2008 Annual Report. This MD&amp;A is dated February 11, 2009. All amounts
in this report are in US dollars, unless otherwise noted.</P>
<P align=justify>All financial information contained in this 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 &#147;Non-GAAP Financial
Measures&#148; on page 5 of this MD&amp;A. The unaudited interim consolidated
financial statements and this MD&amp;A were reviewed by Gildan&#146;s Audit and
Finance Committee and were approved by our Board of Directors. </P>
<P align=justify>Additional information about Gildan, including our 2008 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
<U>www.sec.gov</U>. </P>
<P align=justify>This document contains forward-looking statements, which are
qualified by reference to, and should be read together with the &#147;Forward-looking
Statements&#148; cautionary notice on page 19. </P>
<P align=justify>In this MD&amp;A, &#147;Gildan&#148;, the &#147;Company&#148;, or the words &#147;we&#148;,
&#147;us&#148;, &#147;our&#148; refer, depending on the context, either to Gildan Activewear Inc. or
to Gildan Activewear Inc. together with its subsidiaries and joint venture. </P>
<P align=justify>The Company&#146;s revenues and income are subject to seasonal
variations. Consequently, the results of operations for the first quarter are
traditionally not indicative of the results to be expected for the full year.
</P>
<P align=justify><B><U>OUR BUSINESS</U></B><B> </B></P>
<P align=justify>Gildan is a vertically-integrated marketer and manufacturer of
activewear, socks and underwear. 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 screenprint channel in the U.S. and
Canada, and also a leading supplier for this market in Europe. We sell socks and
underwear, in addition to our activewear products, to mass-market and regional
retailers in North America. The acquisitions of Kentucky Derby Hosiery (Kentucky
Derby) in July 2006 and V.I. Prewett &amp; Son, Inc. (Prewett) in October 2007,
combined with the addition of new branded and private label sock programs, have
positioned Gildan as a leading supplier of basic family socks in the U.S.
mass-market retail channel. </P>
<P align=justify><B>Our Products </B></P>
<P align=justify>We specialize in marketing and large-scale low-cost
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 products, namely T-shirts, fleece and sport
shirts, in large quantities to wholesale distributors as undecorated &#147;blanks&#148;,
which are subsequently sold to screenprinters and embroiderers who decorate our
products with designs and logos. Our products are made of cotton and of blends
of cotton and synthetic fibers. We sell our products to wholesale distributors
under the Gildan brand. Our products are used in a variety of daily activities
by consumers. Uses of our activewear product-line include work and school
uniforms, athletic teamwear and other end-uses to convey individual, group and
team identity. Consumers also purchase the Company&#146;s activewear products in
venues such as sports, entertainment and corporate events, as well as travel and
tourism destinations.</P>
<P align=justify>In the retail channel, we sell a variety of styles of socks
and, to a lesser extent at this stage, men&#146;s and boys&#146; underwear and undecorated
activewear products. We sell these products to mass-market and regional
retailers in North America under various retailer private label programs and
under the Gildan brand. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.2
</FONT></P>
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<A name=page_3></A>
<P align=right><FONT size=2><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND
ANALYSIS</FONT></FONT></P>
<P align=justify><B>Our Facilities </B></P>
<P align=justify><U>Manufacturing </U></P>
<P align=justify>To support our sales in the various markets, we have built
modern manufacturing facilities located in Central America and the Caribbean
Basin where we manufacture T-shirts, fleece, sport shirts, socks and underwear.
Our largest manufacturing hub in Central America includes our first integrated
knitting, bleaching, dyeing, finishing and cutting textile facility (Rio Nance
1) to produce activewear and, more recently, underwear fabric. This facility,
located in Rio Nance, Honduras, became operational in 2002. During 2007, we
commenced production at an integrated sock manufacturing facility (Rio Nance 3)
and a new integrated textile facility for the production of activewear fabric
(Rio Nance 2), in Rio Nance, Honduras. <B></B></P>
<P align=justify>We have also established a vertically-integrated Caribbean
Basin manufacturing hub with a textile facility for the production of activewear
fabric in Bella Vista, Dominican Republic, which became operational in fiscal
2005.</P>
<P align=justify>In addition to our integrated sock manufacturing facility and
leased sock finishing facility, located in our Central America hub, we operate
U.S. sock manufacturing facilities in Fort Payne, Alabama, purchased as part of
the sock manufacturing acquisition in fiscal 2008. On December 11, 2008, we
announced plans to phase out sock finishing operations in the U.S. by the end of
June 2009 and consolidate operations in Honduras, in order to remain globally
competitive in the current economic conditions. </P>
<P align=justify>Our sewing facilities are strategically located in close
proximity to our textile manufacturing facilities. We own and operate sewing
facilities in Nicaragua and Honduras to support our textile manufacturing hub in
Central America. To support our vertically-integrated production in the
Dominican Republic, we utilize third-party contractors in Haiti, and we are in
the process of establishing a sewing facility in the Dominican Republic which we
expect to be operational in fiscal 2009.</P>
<P align=justify><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&#146;s yarn-spinning operations, together with
supply agreements currently in place with Frontier and other third-party yarn
providers, serve to meet our yarn requirements. </P>
<P align=justify><U>Sales, Marketing and Distribution </U></P>
<P align=justify>Our global sales and marketing office is located in St.
Michael, Barbados where we employ more than 160 full-time employees. Our sales
and marketing team is responsible for all customer-related functions including
sales management, marketing, customer service, credit management, sales
forecasting, and inventory control. </P>
<P align=justify>We distribute our products for the screenprint channel 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. To
service the mass-market retail channel, we operate distribution centres in
Martinsville, Virginia and Fort Payne, Alabama.</P>
<P align=justify><U>Employees and Corporate Offices</U></P>
<P align=justify>As of the end of the first quarter of fiscal 2009 we employed
more than 19,000 full-time employees worldwide. Our corporate head office is
located in Montreal, Canada. </P>
<P align=justify><B>Market Overview </B></P>
<P align=justify><U>Target Market </U></P>
<P align=justify>Our markets for activewear, socks and underwear are
characterized by low fashion risk compared to many other apparel markets, since
our products are basic, frequently replenished 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=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.3
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
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<A name=page_4></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The demand for activewear products in the screenprint channel
has been driven by several market trends such as:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>the use of activewear for uniform applications;
  <LI>the use of activewear for corporate promotions;
  <LI>the use of activewear for event merchandising (such as concerts,
  festivals, etc.);
  <LI>the evolution of the entertainment/sports licensing and merchandising
  businesses;
  <LI>the use of activewear products for travel and tourism;
  <LI>the emphasis on physical fitness; and
  <LI>the 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>In the U.S. screenprint channel, T-shirt unit shipments have
grown at a compounded annual rate of 4.5%, between 1999 and 2008, according to
S.T.A.R.S. reports produced by ACNielsen Market Decisions which tracks unit
volume shipments from U.S. wholesale distributors to U.S. screenprinters.
Industry volume for T-shirts during this ten-year period declined only twice,
namely in calendar year 2001 by 3.4% and in 2008 by 4.9% .</P>
<P align=justify>During fiscal 2009, we expect the current global financial
market crisis and economic slowdown to negatively impact demand in the U.S.
screenprint channel, including a decline in corporate and consumer spending. In
addition, we expect that a more unfavourable supply-demand and competitive
environment, combined with recent deflation in cotton and energy prices, will
result in downward pressure on net selling prices. These same market and
competitive factors and risks may impact demand and selling prices in other
international screenprint markets. Similarly, while the basic replenishment
nature of our products sold into the mass-market retail channel may moderate the
negative impact of the downturn in overall economic conditions and consumer
spending, the retail market for our products has been experiencing weaker demand
and inventory reductions by retailers. Consequently, there is no assurance that
our sales will not be negatively impacted by the current economic
uncertainty.</P>
<P align=justify><U>Competitive Environment </U></P>
<P align=justify>The market for our products is highly competitive. Competition
is generally based upon price, with reliable quality and service also being
requirements for success. Our primary competitors in North America both in the
screenprint and retail channels are the major U.S.-based manufacturers of basic
family apparel for the screenprint and retail channels, such as the Hanes, Fruit
of the Loom, Jerzees and Anvil brands. Competition in socks in the U.S.
mass-market retail channel is more fragmented, with a higher proportion of
private label programs that are frequently outsourced from Asian contractors by
retail vendors based in the U.S. </P>
<P align=justify>The competition in the European screenprint channel is similar
to that in North America, as we compete primarily with the U.S.-based brands
mentioned above. We also have European-based competitors that do not have
integrated manufacturing operations and source products from suppliers in Asia.
In addition, we may face the threat of increasing global competition.</P>
<P align=justify><B><U>STRATEGY AND OBJECTIVES</U></B><B> </B></P>
<P align=justify>Our growth strategy comprises the following initiatives:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>Continue to increase market share in the U.S. screenprint channel in all
  product categories;
  <LI>Leverage our successful business model to further penetrate the
  mass-market retail channel and develop Gildan as a consumer brand;
  <LI>Pursue international growth opportunities;
  <LI>Continue to generate manufacturing and distribution cost reductions; and
  <LI>Pursue selective complementary acquisitions. </LI></UL>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.4
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_5></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<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 a main reason that we have been able to continue to increase our market
presence and establish our market leadership in the imprinted sportswear market.
Management believes that these same factors will support Gildan&#146;s strategy to
expand its presence in international screenprint markets and further penetrate
the retail channel. </P>
<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 under the &#147;Financial Risk Management&#148; and &#147;Risks and Uncertainties&#148;
sections of our 2008 Annual MD&amp;A, as subsequently updated in this interim
MD&amp;A. </P>
<P align=justify><B><U>OPERATING RESULTS</U></B></P>
<P align=justify><B>Statement of Earnings Classifications </B></P>
<P align=justify>Effective the first quarter of fiscal 2009, we changed certain
classifications of our Statement of Earnings and Comprehensive Income with
retrospective application to comparative figures presented for prior periods.
These new classifications align the results of operations by function and
incorporate presentation requirements under Canadian Institute of Chartered
Accountants (CICA) Handbook Section 3031, <I>Inventories</I>, which has been
adopted effective the first quarter of fiscal 2009. Pursuant to the requirements
of Section 3031, depreciation expense related to manufacturing activities is
included in cost of sales. The remaining depreciation and amortization expense
has been reclassified to selling, general and administrative (SG&amp;A)
expenses. Depreciation and amortization expense is therefore no longer presented
as a separate caption on the Statement of Earnings and Comprehensive Income. In
addition, we reclassified certain other items in our Statement of Earnings and
Comprehensive Income. Outbound freight, previously classified within SG&amp;A
expenses, is now reported within cost of sales. Also, a new caption is now
presented for financial expenses and income, which includes interest income and
expenses, foreign exchange gains and losses (including mark-to-market
adjustments of forward foreign exchange contracts), and other financial charges.
Interest expense net of interest income was previously reported as a separate
caption, while foreign exchange gains and losses (including mark-to-market
adjustments of forward foreign exchange contracts) were previously included in
cost of sales. Other financial charges were previously reflected in SG&amp;A
expenses. These changes in classification have resulted in a decrease of $13.4
million and $0.9 million in gross profit and SG&amp;A expenses, respectively,
compared to the amounts previously reported for the first quarter of fiscal
2008. For the period ended December 30, 2007, the decrease of $13.4 million in
gross profit is due to reclassifications of $9.5 million of depreciation and
amortization expense, $3.6 million of outbound freight and $0.3 million of
foreign exchange gains and other financial income. There has been no impact on
net earnings as a result of these changes in classification. </P>
<P align=justify><B>Non-GAAP Measures </B></P>
<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&#146;s financial condition and operating results.</P>
<P align=justify>We refer the reader to page 17 for the definition and complete
reconciliation of all non-GAAP measures used and presented by the Company to the
most directly comparable GAAP measures. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.5
</FONT></P>
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<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B>Summary of Quarterly Results </B></P>
<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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
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  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left colspan="2" nowrap><I>(in $ millions,
      except per share amounts) </I><I><SUP>(1) </SUP></I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="7%"><B>2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">2008
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="7%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">2007
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><B>Q1
      </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q4 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q2 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q1 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q4 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%">Q2 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net Sales </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>184.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>324.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>380.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>293.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>250.5 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>254.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>291.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>232.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Net earnings<I><SUP>(2) </SUP></I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>4.3 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">21.8 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">54.5 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">42.1 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">27.9 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">41.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">52.4 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">20.9 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net earnings per share<SUP>(2) </SUP></TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Basic EPS </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>0.04 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.18 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.45 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.35 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.23 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.34 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.44 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">0.17 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Diluted EPS </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>0.04 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.18 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.45 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.35 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.23 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.34 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.43 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>0.17 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Total assets<I><SUP>(2) </SUP></I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%"><B>1,043.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,101.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,104.4 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">1,057.9 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">993.3 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">872.0 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">822.0 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="7%">792.6 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Total long-term financial liabilities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff><B>51.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>53.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>108.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>146.3 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>130.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>59.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>42.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="7%" bgColor=#e6efff>74.2 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Weighted average number of </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="7%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#FFFFFF>&nbsp;&nbsp;&nbsp; shares outstanding
      <I>(in &#145;000s) </I></TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#FFFFFF>&nbsp;</TD>
    <TD align=left width="7%" bgColor=#FFFFFF>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#FFFFFF>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Basic </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF"><B>120,573 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,531 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,492 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,464 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,428 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,401 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,359 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="7%" bgcolor="#E6EFFF">120,320 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#FFFFFF>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Diluted </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF><B>121,408 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,558 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,622 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,649 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,656 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,577 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,599 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#FFFFFF>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#FFFFFF>121,529 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#FFFFFF>&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR>
    <TD vAlign=top><I><SUP><font style="font-size: 8pt">(1) </font> </SUP></I>
    </TD>
    <TD>
      <P align=justify><font style="font-size: 8pt"></font></font><I><font style="font-size: 8pt">Quarterly results reflect the acquisition of Prewett
      on October 15, 2007 (Q1 2008) from the date of acquisition.</font></I></P></TD></TR>
  <TR>
    <TD vAlign=top><I><SUP><font style="font-size: 8pt">(2) </font> </SUP></I>
    </TD>
    <TD>
      <P align=justify><font style="font-size: 8pt"></font></font><I><font style="font-size: 8pt">Net earnings, Net earnings per share and Total assets
      reflect the impact of the change in accounting policy as described in Note
      3 to the unaudited interim consolidated financial
  statements.</font></I></P></TD></TR></TABLE>
<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. 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 in
sales we have historically experienced will continue in the future, although it
is expected to be somewhat mitigated by our product diversification should
fleece and sock products account for a higher proportion of our total sales.
<B></B></P>
<P align=justify>Historically, throughout the year, we have operated 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, in particular a build-up of inventory
levels in the first half of the year. In the current economic environment, we
intend to prudently manage our inventory levels in relation to market conditions
as they evolve, and we will evaluate the need for production downtime as
required to align inventories with demand.<B> </B></P>
<P align=justify><B>Net Sales </B></P>
<P align=justify>Net sales for the first quarter of fiscal 2009, which is
seasonally the lowest quarter of the fiscal year for our activewear sales,
amounted to $184.0 million, down 26.5% from $250.5 million in the first quarter
of fiscal 2008. The decrease in net sales was due to a 28.0% decline in
activewear and underwear unit volumes, a decrease of 16.9% in sock sales and
more unfavourable activewear product-mix. The lower unit volumes were due to an
11.6% decline in overall industry unit shipments by U.S. wholesale distributors
to screenprinters and the significant impact of inventory reductions during the
quarter by U.S. wholesale distributors, which more than offset Gildan&#146;s
increased market share penetration in the U.S. screenprint channel.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.6
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_7></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></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. The table below summarizes the S.T.A.R.S. data for the
calendar quarter ended December 31, 2008: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left width="46%">&nbsp; </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>Three months ended </B></TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>Three months ended </B></TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left width="46%">&nbsp; </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>December 31, </B></TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center>&nbsp;</TD>
    <TD align=center colSpan=4>
    <p style="margin-left: 30"><B>December 31, </B></TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>2008 vs. 2007 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>2008 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>2007 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Unit Growth </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Market Share </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="46%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>Gildan </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>
    <p align="right"><B>Industry </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    colSpan=4>
    <p style="margin-left: 30"><B>Gildan </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff width="46%">All products </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>(4.7</B></TD>
    <TD align=left width="3%" bgColor=#e6efff><b>)% </b> </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>(11.6</TD>
    <TD align=left width="3%" bgColor=#e6efff>)% </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>53.3% </B></TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff>49.3% </TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left width="46%">T-shirts </TD>
    <TD align=left width="3%">&nbsp;</TD>
    <TD align=right width="8%"><B>(3.8</B></TD>
    <TD align=left><b>)% </b> </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right>(10.9</TD>
    <TD align=left>)% </TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right><B>54.2% </B></TD>
    <TD align=left width="3%">&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=right>50.0% </TD>
    <TD align=left>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff width="46%">Fleece </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="8%" bgColor=#e6efff><B>(7.1</B></TD>
    <TD align=left bgColor=#e6efff><b>)% </b> </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff>(12.0</TD>
    <TD align=left bgColor=#e6efff>)% </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff><B>51.9% </B></TD>
    <TD align=left width="3%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=right bgColor=#e6efff>49.1% </TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="46%">Sport shirts </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right><B>(25.7</B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><b>)% </b> </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right>(25.8</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>)% </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right><B>35.4% </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right>35.4%
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>&nbsp;</TD></TR></TABLE>
<P align=justify>Gildan achieved market share gains in both the T-shirt and
fleece categories, while our market share for sport shirts remained flat
compared to the same period last year. In the T-shirt category, we increased our
market share by approximately 4 percentage points to 54.2% . Similarly in the
fleece category we increased our market share to 51.9% compared to 49.1% in the
same period last year.</P>
<P align=justify>Activewear unit shipments to Canada and our international
markets were down by 20.3% for the first quarter of fiscal 2009. The Canadian
market reflected the biggest decline, which was impacted by inventory reductions
by distributors. While sales in Europe for the first quarter of fiscal 2009 were
slightly below first quarter fiscal 2008 levels, shipments in the last two
months of the first quarter of fiscal 2009 were up year over year. Although
sales in Mexico represent a small portion of our total international business,
sales in Mexico were up significantly during the quarter, benefiting from the
improved sales and distribution infrastructure that has been implemented. </P>
<P align=justify>Sales of socks for the first quarter of fiscal 2009 included an
extra two weeks of sales from the Prewett acquisition, which was effective from
October 15, 2007. However, unit sales of socks decreased due to the elimination
of unprofitable sock product-lines during fiscal 2008, and a reduction in
inventories carried by retailers. Unit sales of Gildan socks from Gildan&#146;s major
retail customers to consumers were essentially unchanged compared with the
previous year, in spite of weak overall retail market conditions.</P>
<P align=justify><B>Gross Profit </B></P>
<P align=justify>Gross profit for the first quarter of fiscal 2009 was $38.9
million, or 21.1% of net sales, compared to $65.6 million, or 26.2% of net sales
during the first quarter of fiscal 2008. The decline in gross margins was due to
significantly higher cotton and energy costs, more unfavourable activewear
product-mix due to a lower proportion of high-valued fleece and long-sleeve
T-shirts, higher depreciation expenses absorbed in cost of sales, a higher
proportion of sales of socks compared to activewear, the temporary impact of
additional packaging costs related to a transition in sock private label brands
for Gildan&#146;s largest retail customer, which is being implemented in the second
half of fiscal 2009, and higher labour costs. These factors were partially
offset by increased manufacturing efficiencies, the non-recurrence of sock
inventory write-downs in the first quarter of fiscal 2008 and higher net selling
prices compared to the first quarter of last year. </P>
<P align=justify><B>Selling, General and Administrative Expenses</B></P>
<P align=justify>Selling, general and administrative (SG&amp;A) expenses in the
first quarter of fiscal 2009 were $33.5 million, or 18.2% of sales, compared to
$31.7 million, or 12.7% of sales, in the first quarter of last year. Higher
SG&amp;A expenses reflected a $1.8 million impact of an increase in accounts
receivable provisions, together with higher professional and legal fees,
partially offset by lower volume-related distribution expenses and the impact of
the reduction in the value of the Canadian dollar on Gildan&#146;s corporate
administrative expenses. </P>
<P align=justify><B>Restructuring and Other Charges </B></P>
<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 our corporate office. In addition, in the third quarter of fiscal 2008, we
announced the planned consolidation of our Haiti sewing operation to be
finalized in the first half of fiscal 2009. The costs incurred in connection
with these initiatives have been recorded as restructuring and other
charges.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.7
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_8></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Restructuring charges of $0.9 million in the first quarter of
fiscal 2009 included $0.3 million of additional severance relating to the
closures noted above, and $0.6 million of exit costs, mainly for the closure of
the Haiti sewing facility. Restructuring charges of $0.8 million in the first
quarter of fiscal 2008 were composed of $1.1 million of other exit costs,
primarily related to the closures noted above, including carrying and
dismantling costs associated with assets held for sale, less a gain of $0.3
million recognized on the disposal of assets held for sale. </P>
<P align=justify>Assets held for sale of $10.5 million as at January 4, 2009
(October 5, 2008 - $10.5 million; December 30, 2007 - $12.7 million) include
property, plant and equipment at these various locations. We expect to incur
additional carrying costs relating to these assets, which will be accounted for
as restructuring charges as incurred during fiscal 2009, until all property,
plant and equipment related to the closures are disposed of. Any gains or losses
on the disposition of the assets held for sale will also be accounted for as
restructuring charges as incurred. </P>
<P align=justify><B>Financial Expense, net </B></P>
<P align=justify>Net financial expense amounted to $0.2 million during the first
quarter of fiscal 2009, compared to net financial expense of $2.7 million in the
same period last year. The decrease in net financial expense in the quarter
resulted primarily from a decrease in interest expense of $1.9 million and an
increase in foreign exchange gains of $0.7 million. The decrease in interest
expense was due to higher average borrowings during the first quarter of fiscal
2008 to finance the acquisition of Prewett and the impact of lower average
interest rates during the first quarter of fiscal 2009.</P>
<P align=justify><B>Income Taxes </B></P>
<P align=justify>Income tax expense for the first quarter of fiscal 2009 was
$0.3 million compared to an income tax expense of $2.1 million in the first
quarter of fiscal 2008. Excluding the impact of restructuring and other charges,
the effective income tax rate in the first quarter of fiscal 2009 was 6.0%
compared to an effective income tax rate of 6.8% for the same period last year.
</P>
<P align=justify><B>Net Earnings </B></P>
<P align=justify>Net earnings were $4.3 million, or $0.04 per share on a diluted
basis, for the first quarter ended January 4, 2009, compared with net earnings
of $27.9 million, or $0.23 per share on a diluted basis in the first quarter of
fiscal 2008.</P>
<P align=justify>The reduction in net earnings and earnings per share (EPS) on a
diluted basis in the first quarter compared to last year was primarily due to
significantly lower unit sales volumes, combined with higher cotton and energy
costs reflected in inventories consumed in cost of sales during the quarter,
more unfavourable activewear product-mix, and increased provisions for accounts
receivable. Cotton costs are projected to be at their highest point during the
year in the first quarter of fiscal 2009, and were at their lowest point during
fiscal 2008 in the first quarter. These negative factors were partially offset
by favourable manufacturing efficiencies and higher net selling prices for
activewear, compared to the first quarter of fiscal 2008. Our results were
within our EPS guidance range of $0.00 - $0.05 for the first quarter of fiscal
2009, provided on December 11, 2008. Compared to our EPS guidance for the
quarter, the impact of lower than projected selling price discounts was offset
by lower than projected unit sales volumes due to continuing inventory
destocking by U.S. wholesale distributors, and increased provisions for accounts
receivable. </P>
<P align=justify><B><U>FINANCIAL CONDITION</U></B><B> </B></P>
<P align=justify>Accounts receivable of $98.8 million as at January 4, 2009
reflected decreases of $123.4 million compared to accounts receivable of $222.2
million at the end of fiscal 2008 and $53.2 million compared to the end of the
first quarter of fiscal 2008. The decrease in accounts receivable from the end
of fiscal 2008 reflected a lower seasonal level of sales and a decline in days
sales outstanding consistent with prior years due to seasonal programs invoiced
with extended payment terms maturing in the first quarter. The decrease in
accounts receivable compared to the first quarter of fiscal 2008
primarily reflected the 26.5% sales decline over the prior year.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.8
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_9></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Inventories of $386.4 million were up $70.2 million, or 22.2%
from October 5, 2008 and up $91.8 million, or 31.2% compared to the first
quarter of fiscal 2008. Consistent with prior years, our activewear inventories
increased during the first quarter of our fiscal year, as we do not adjust
production levels to match seasonal sales patterns. The increase in activewear
inventories over the fourth quarter of fiscal 2008 was partially offset by a
seasonal decrease in sock inventories. The increase in inventories from the
first quarter of fiscal 2008, resulted from a higher seasonal build-up of
activewear inventories and higher unit costs due to increases in cotton and
energy prices. The Company will carefully monitor its inventory levels in
relation to market conditions as they evolve, and may schedule production
downtime where required to realign inventories with market demand. </P>
<P align=justify>Property, plant and equipment, which are net of accumulated
amortization, including asset impairment losses, amounted to $435.2 million at
January 4, 2009, a decrease of $1.3 million compared to $436.5 million at
October 5, 2008. The decrease was primarily due to net capital expenditures of
$13.7 million, mainly for the capacity expansion projects in Honduras, offset by
depreciation of property, plant and equipment of $15.0 million.</P>
<P align=justify>Intangible assets amounted to $59.2 million as at January 4,
2009 compared to $60.0 million at the end of fiscal 2008. The decrease related
to the amortization of intangible assets for the first quarter of fiscal 2009.
Goodwill of $6.7 million at the end of the first quarter of fiscal 2009 related
to the acquisition of Prewett in October 2007. In light of the current economic
and market conditions, including the negative impact on our current results, we
deemed it appropriate to perform an impairment test on our goodwill in the first
quarter of fiscal 2009 by comparing the fair value of the reporting unit
associated with the goodwill to its carrying value. Management concluded that
there has been no impairment in the value of goodwill carried on the interim
consolidated balance sheet as at January 4, 2009. In addition, management
concluded that the carrying value of intangible assets was fully recoverable as
at January 4, 2009. </P>
<P align=justify>Total assets were $1,043.5 million as at January 4, 2009,
compared to $1,101.3 million at the end of the previous year. Working capital
was $363.1 million as at January 4, 2009 compared to $355.2 million as at
October 5, 2008. The current ratio at the end of the first quarter of fiscal
2009 was 3.5 compared to 2.7 at the end of fiscal 2008. </P>
<P align=justify>Accounts payable and accrued liabilities amounted to $124.6
million at January 4, 2009, compared to $155.7 million at the end of fiscal
2008. The decrease of $31.1 million was primarily due to seasonal factors and
lower capital spending.</P>
<P align=justify>Income taxes payable were $17.4 million at January 4, 2009
compared to $46.6 million at October 5, 2008. The decrease in income taxes
payable was mainly due to a payment of $23.8 million related to the settlement
of the Canada Revenue Agency audit as announced in December 2008 and as
described in Note 14 to the 2008 annual audited Consolidated Financial
Statements. </P>
<P align=justify><B><U>CASH FLOWS</U></B><B> </B></P>
<P align=justify>Cash flows from operating activities in the first quarter of
fiscal 2009 were $15.9 million down from $103.4 million for the previous year.
The decrease in cash inflow was primarily due to lower cash operating earnings,
higher seasonal increases in inventories, a higher seasonal decline in accounts
payable and accrued liabilities and income tax payments of $23.8 million in
respect of prior fiscal years, offset by a larger seasonal decrease in accounts
receivable compared to the first quarter of fiscal 2008. </P>
<P align=justify>Cash flows used in investing activities were $12.1 million in
the first quarter of fiscal 2009, compared to $169.2 million in the previous
year. The decrease of $157.1 million was mainly due to the acquisition of
Prewett in the first quarter of fiscal 2008 for a purchase price of $126.8
million, plus a contingent payment of $10.0 million, which was placed in escrow.
The remaining decrease was mainly due to lower capital expenditures, as the Rio
Nance 2 and Rio Nance 3 projects were being ramped up during the first quarter
of last year. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.9
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_10></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>We generated free cash flow<SUP>1 </SUP>of $2.9 million in the
first quarter of fiscal 2009 compared to $71.0 million for the same period last
year, mainly as a result of lower cash flows from operating activities. </P>
<P align=justify>Cash flows used in financing activities were $1.5 million in
the first quarter of fiscal 2009 compared to cash inflows of $70.2 million in
the first quarter last year. The decrease in use of funds related mainly to a
net amount of $71.0 million drawn on our revolving long-term credit facility in
the first quarter of fiscal 2008 to finance the acquisition of Prewett in
October 2007.</P>
<P align=justify>We ended the first quarter of fiscal 2009 with cash and cash
equivalents of $14.4 million compared to $12.4 million at the end of fiscal
2008. Total indebtedness<SUP>2 </SUP>as at January 4, 2009 amounted to $51.2
million compared to $130.8 million at the end of the first quarter of fiscal
2008 and $53.0 million at the end of fiscal 2008. We had $45 million drawn from
our revolving long-term credit facility as at the end of the first quarter of
fiscal 2009 and as at October 5, 2008. In addition, an amount of $1.0 million
has been committed against this facility to cover various letters of credits. In
fiscal 2008, we used our revolving long-term credit facility, in addition to our
cash flow from operations, to finance the acquisition of Prewett and capital
expenditures of our major capacity expansion projects in Honduras. Indebtedness
to fund the acquisition of Prewett was fully repaid using operating cash flows
during fiscal 2008. </P>
<P align=justify><B><U>LIQUIDITY AND CAPITAL RESOURCES</U></B><B> </B></P>
<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 uses of funds on an ongoing
basis are for capital expenditures for new manufacturing facilities,
inventories, accounts receivable, and business acquisitions. In fiscal 2009, we
are also using funds for the payment of income taxes pursuant to the Company&#146;s
settlement of its transfer pricing audit with the Canada Revenue Agency as
announced in December 2008.</P>
<P align=justify>On October 30, 2007, we increased our committed long-term
credit facility to $400 million, on an unsecured basis, which matures in June
2013. We believe that our cash flow from operating activities together with the
unused portion of our credit facilities will provide us with sufficient
liquidity and capital resources in fiscal 2009 to fund our anticipated working
capital, capital expenditure requirements and income tax payments. </P>
<P align=justify>A major objective for the Company in fiscal 2009 will be to
maintain its strong financing position and ensure that it continues to be in a
position to take advantage of any strategic growth opportunities that may arise. In the current economic environment, Gildan intends to
prudently manage both receivable and inventory levels and its capital
expenditures. Inventories will be carefully monitored in relation to market
conditions as they evolve, and we will evaluate the need for production downtime
as required to align inventories with sales demand. We are continuing to defer
construction of the Rio Nance 5 facility until the economic outlook in support
of further major capacity expansion becomes clearer. In addition, we have
decided to proceed cautiously on other expansion projects and defer the ramp-up
of our second sock manufacturing facility (Rio Nance 4) in Honduras. We plan to
transfer our U.S. sock finishing operations to an existing leased facility in
Honduras in order to achieve planned manufacturing efficiencies without
incurring major capital costs or creating significant new industry overcapacity.
The Rio Nance 4 building will be utilized as a distribution centre while sock
capacity expansion requirements are re-assessed. Capital expenditures for fiscal
2009 are now projected at approximately $80 million, compared with our previous
forecast of $115 million and our original projection of $160 million in August
2008.</P>
<P align=justify>The projected capital investments primarily include estimated
expenditures related to investments to complete the construction of the building
for the Rio Nance 4 facility in Honduras, incremental capacity expansions at
existing facilities, a biomass combustion energy project in the Dominican
Republic and capital investments related to the expansion of our sales and
marketing infrastructure in Barbados following the integration of our retail
activities. </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD vAlign=top colspan="2"><u>______________________</u></TD>
    </TR>

  <TR>
    <TD vAlign=top><FONT size=1><SUP>1 </SUP></FONT></TD>
    <TD><FONT size=1>
      <P align=justify>Free cash flow is comprised of cash flows from operating
      activities, including net changes in non-cash working capital balances,
      less cash used in investing activities, excluding business acquisitions.
      See page 19.</P></FONT></TD></TR>
  <TR>
    <TD><FONT size=1>&nbsp;</FONT></TD>
    <TD><FONT size=1>&nbsp;</FONT></TD></TR>
  <TR>
    <TD vAlign=top><FONT size=1><SUP>2 </SUP></FONT></TD>
    <TD><FONT size=1>
      <P align=justify>Total indebtedness is comprised of bank indebtedness and
      long-term debt (including the current portion). See page
  19.</P></FONT></TD></TR></TABLE>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.10
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_11></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>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&#146;s Board
of Directors periodically evaluates the merits of introducing a dividend. </P>
<P align=justify><B>Contractual Obligations </B></P>
<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 by period, excluding
interest on long-term debt, for the following items as at January 4, 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><FONT size=2>&nbsp; </FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="7%"><FONT size=2>&nbsp; </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>Less than </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>1 to 3 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>4 to 5 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>More than </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT
      size=2><I>(in $ millions) </I></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>Total </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>1 year </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>5 years </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><FONT size=2>Long-term debt </FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2><B>51.2
    </B></FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>2.5 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>3.7 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>45.0 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left><FONT size=2>Operating leases </FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2><B>43.5 </B></FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>6.4 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>18.7 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>7.9 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%"><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%"><FONT size=2>10.5 </FONT></TD>
    <TD align=left width="2%"><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><FONT size=2>Purchase obligations
</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2><B>264.5
      </B></FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>234.8 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>29.7 </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=left width="1%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD align=right width="7%" bgColor=#e6efff><FONT size=2>- </FONT></TD>
    <TD align=left width="2%" bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><FONT size=2>Other
      obligations </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2><B>44.9 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>44.9 </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"><FONT
      size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="7%"><FONT
      size=2>- </FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"><FONT
      size=2>&nbsp;</FONT></TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff><FONT size=2><B>Total Contractual Obligations
    </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>404.1 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>288.6 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>52.1 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>52.9 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="7%"
    bgColor=#e6efff><FONT size=2><B>10.5 </B></FONT></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff><FONT size=2>&nbsp;</FONT></TD></TR></TABLE>
<P align=justify>We expect that cash flows from our operating earnings, together
with our year-end cash balances and unutilized bank facilities, will be
sufficient to meet our obligations for the foreseeable future. </P>
<P align=justify><B>Outstanding Share Data</B></P>
<P align=justify>Our common shares are listed on the New York Stock Exchange and
the Toronto Stock Exchange (GIL). As at January 31, 2009, there were 120,637,793
common shares issued and outstanding along with 1,081,328 stock options and
890,112 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>
<P align=justify><B><U>LEGAL PROCEEDINGS </U></B></P>
<P align=justify><B>Securities Class Actions</B></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
have been consolidated, and a consolidated amended complaint has been filed. 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&#146;s common shares between August 2, 2007 and April 29, 2008 and allege,
among other things, that the defendants misrepresented the Company&#146;s financial
condition and its financial prospects in its financial guidance concerning the
2008 fiscal year, which was 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&#146;s <I>Securities Act </I>and an amended complaint along with
affidavit evidence for leave to pursue such statutory liability claims and class
certification have been filed. 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 unaudited interim consolidated financial statements.</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.11
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_12></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B><U>OUTLOOK</U></B></P>
<P align=justify>We believe there is increasing uncertainty regarding the
severity and duration of the current economic and financial crisis. In addition,
continuing weak end-use demand and tighter credit markets may affect the
financial condition and liquidity of wholesale customers, resulting in increased
credit risk and a need for the Company to prudently balance short-term market
share considerations with such increased customer credit risk.</P>
<P align=justify>Gildan&#146;s operations are performing well, and the Company
believes that its strong competitive positioning, combined with its strong
balance-sheet and free cash flow generation, will allow it to take advantage of
potential opportunities resulting from any industry rationalization or
restructuring that may occur as a result of a prolonged industry downturn and
crisis in liquidity. </P>
<P align=justify>A discussion of management&#146;s expectations as to our outlook for
fiscal 2009 is contained in our first quarter fiscal 2009 earnings results press
release dated February 11, 2009. The press release is available on the SEDAR
website at <U>www.sedar.com</U>, on the EDGAR website at <U>www.sec.gov </U>and
on our website at <U>www.gildan.com</U>. </P>
<P align=justify><B><U>FINANCIAL RISK MANAGEMENT</U></B><B> </B></P>
<P align=justify>This section of the MD&amp;A provides disclosures relating to
the nature and extent of the Company&#146;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 section, in conjunction with the information in Note 11 to the
unaudited interim consolidated financial statements (&#147;Financial Instruments&#148;),
are designed to meet the requirements of the Canadian Institute of Chartered
Accountants Handbook Section 3862, &#147;Financial Instruments-Disclosures&#148;, and are
therefore incorporated into, and are an integral part of, the unaudited interim
consolidated financial statements. </P>
<P align=justify><B>Credit risk </B></P>
<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&#146;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 11 to the unaudited interim
consolidated financial statements, represents the Company&#146;s credit exposure at
the reporting date, including trade receivables. Our trade receivables and
credit exposure fluctuate throughout the year based on the seasonality of our
sales and other factors. The Company&#146;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>
<P align=justify>The Company&#146;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 January 4, 2009, the
Company&#146;s ten largest trade debtors accounted for 75.8% of trade accounts
receivable, of which one wholesale customer accounted for 21.9% and one retailer
accounted for 19.1% . Of the Company&#146;s top ten trade debtors, five are wholesale
distributors, and nine are located in the United States. The remaining trade
receivable balances are dispersed among a larger number of debtors across many
geographic areas including the United States, Canada, Europe, Mexico and
Australia.</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&#146;s customers have generally been transacting with
the Company or its subsidiaries for over five years, and credit losses have not
been material during that period. With the exception of the largest wholesale
distributor, which is owned by a large private equity firm and largely financed
by publicly traded bonds, most of our wholesale distributor customers are
privately-held owner-managed enterprises. 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 refinance
existing indebtedness or to obtain additional financing, and could affect their
ability to comply with restrictive debt covenants and meet other obligations.
The profile and credit quality of the Company&#146;s retail customers varies
significantly. Adverse changes in a customer&#146;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&#146;s future purchases or result in
uncollectible accounts receivable from that customer. Future credit losses
relating to any one of our top ten customers could be material and could result
in a material charge to earnings. The likelihood of such losses occurring has
increased given the current economic downturn. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.12
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_13></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The Company&#146;s extension of credit to customers involves
considerable judgment and is based on an evaluation of each customer&#146;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&#146;s
international sales office in Barbados. Where available, the Company&#146;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. From time to time,
the Company will temporarily transact with customers on a prepayment basis where
circumstances warrant. While the Company&#146;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&#146;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&#146;s exposure. The information available through the
insurance company is also considered in the decision process to determine the
credit limits assigned to customers. This policy contains the usual clauses and
limits regarding the amounts that can be claimed by event and by year of
coverage. The Company did not file any claim against this credit insurance
policy for the three month period ended January 4, 2009. </P>
<P align=justify>The Company&#146;s exposure to credit risk for trade receivables by
geographic area and type of customer was as follows as at: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">United States </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>68.7 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">176.0 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Europe </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>7.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">11.9 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Canada </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>4.4 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">14.2 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Other regions </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>3.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">4.2
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left bgcolor="#E6EFFF">Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%" bgcolor="#E6EFFF"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%" bgcolor="#E6EFFF">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Distributors and screenprinters </TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF"><B>46.5 </B></TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=left width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD align=right width="12%" bgcolor="#E6EFFF">166.2 </TD>
    <TD align=left width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Mass-market and
      regional retailers </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>37.7 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">40.1
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left bgcolor="#E6EFFF">Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%" bgcolor="#E6EFFF"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%" bgcolor="#E6EFFF">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%" bgcolor="#E6EFFF">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%" bgcolor="#E6EFFF">&nbsp;</TD></TR></TABLE>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.13
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_14></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>The aging of trade receivable balances was as follows as at:
</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Not past due </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>67.5 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>186.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Past due 0-30 days </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>15.4 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">15.7 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Past due 31-120 days </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>5.1 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Past due 121-180 days </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">2.3 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Past due over 180 days </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>- </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Trade receivables </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>88.8 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>209.1 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Less allowance for
      doubtful accounts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(4.6</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(2.8</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Total trade
      receivables </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>84.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">206.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<P align=justify>The movement in the allowance for doubtful accounts in respect
of trade receivables was as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><I>(in $ millions) </I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Three months ended </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">Twelve months ended </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>January 4, 2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">October 5, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Balance, beginning of period </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>2.8 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Bad debt expense </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>1.8 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">4.5 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Write-off of accounts receivable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(4.0</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Increase due to
      acquisition of Prewett </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>-
      </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">0.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff>Balance, end of period </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>4.6 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>2.8 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify><B>Liquidity Risk</B></P>
<P align=justify>Liquidity risk is the risk that the Company will not be able to
meet its financial obligations as they fall due. We require continued access to
capital markets to support our operations as well as to achieve our strategic
plans. We rely on cash resources, debt and cash flows generated from operations
to satisfy our financing requirements. Any impediments to our ability to
continue to meet the covenants and conditions contained in our revolving credit
facility as well as our ability to access capital markets, or the failure of a
financial institution participating in our credit facility, or an adverse
perception in capital markets of our financial condition or prospects, could
have a material impact on our financing capability. In addition, our access to
financing at reasonable interest rates could become influenced by the economic
and credit market environment.</P>
<P align=justify>We manage liquidity risk through the management of our capital
structure and financial leverage, as outlined in Note 20 to the 2008 annual
audited Consolidated Financial Statements (&#147;Capital Disclosures&#148;). In addition,
we manage liquidity risk by continuously monitoring actual and projected cash
flows, taking into account the seasonality of our sales and receipts. We also
monitor the impact of credit market conditions in the current environment. The
Board of Directors reviews and approves the Company&#146;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. </P>
<P align=justify>The Company has a committed revolving credit facility for a
maximum of $400 million which expires in June 2013 and which is subject to a
one-year extension on an annual basis. The Company&#146;s revolving credit facility
is subject to various covenants and conditions. The Company was in compliance
with all covenants as at January 4, 2009. This facility is unsecured and amounts
drawn bear interest at LIBOR rates or U.S. base rate plus an applicable margin.
As at January 4, 2009, $45.0 million was drawn under this facility, bearing an
effective interest rate of 1.78% . As at October 5, 2008, $45.0 million was
drawn under this facility bearing an effective interest rate of 4.75% . </P>
<P align=justify>The Company&#146;s only derivative financial instruments as at
January 4, 2009 were forward foreign exchange contracts, for which notional
amounts, maturities, average exchange rates and the carrying and fair values are
disclosed in Note 11 to the unaudited interim consolidated financial statements.
</P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.14
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_15></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Please refer to the &#147;Financial Risk Management&#148; section of the
Company&#146;s 2008 Annual MD&amp;A for details of the contractual maturities of
financial liabilities. </P>
<P align=justify><B>Foreign Currency Risk</B></P>
<P align=justify>The majority of the Company&#146;s cash flows and financial assets
and liabilities are denominated in U.S. dollars, which is the Company&#146;s
functional and reporting currency. Foreign currency risk is limited to the
portion of the Company&#146;s business transactions denominated in currencies other
than U.S. dollars, primarily for sales and distribution expenses for customers
outside of the United States and head office expenses in Canada. The Company&#146;s
exposure relates primarily to changes in the U.S. dollar versus the Canadian
dollar, the British Pound and the Euro exchange rates. For the Company&#146;s foreign
currency transactions, fluctuations in the respective exchange rates relative to
the U.S. dollar will create volatility in the Company&#146;s cash flows and the
reported amounts for sales and SG&amp;A 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 the U.S. dollar 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&#146;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 flows
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>As at January 4, 2009 all outstanding forward foreign exchange
contracts were reported on a mark-to-market basis and the gains and losses were
included in earnings. The Company elected not to apply hedge accounting for
these derivatives. </P>
<P align=justify>Please refer to the &#147;Financial Risk Management&#148; section of the
Company&#146;s 2008 Annual MD&amp;A for further details of the Company&#146;s significant
foreign currency exposures. </P>
<P align=justify><B>Interest Rate Risk</B></P>
<P align=justify>The Company&#146;s interest rate risk is primarily related to the
Company&#146;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><B><U>CRITICAL ACCOUNTING ESTIMATES</U></B><B> </B></P>
<P align=justify>Our significant accounting policies are described in Note 2 to
our 2008 audited annual 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. In
addition, although our critical accounting estimates remain substantially
unchanged from those that were disclosed in our 2008 Annual MD&amp;A, there is a
likelihood that these estimates may materially change, or new estimates may be
required, given the current uncertain economic conditions. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.15
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_16></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Management believes that the following accounting estimates
require assumptions to be made about matters that are highly uncertain. </P>
<UL style="TEXT-ALIGN: justify">
  <LI>Allowance for Doubtful Accounts;
  <LI>Inventory Obsolescence;
  <LI>Sales Promotional Programs;
  <LI>Recoverability of Long-Lived Assets;
  <LI>Income Taxes; and
  <LI>Business Acquisitions. </LI></UL>
<P align=justify>For a more detailed discussion of these estimates, readers
should review the &#147;Critical Accounting Estimates&#148; section of the 2008 Annual
MD&amp;A.<B> </B></P>
<P align=justify><B><U>ADOPTION OF NEW ACCOUNTING STANDARDS</U></B><B> </B></P>
<P align=justify>Effective the commencement of its 2009 fiscal year, the Company
adopted CICA Handbook Section 3031, <I>Inventories, </I>Section 1400, <I>General Standards of
Financial Statement Presentation </I>and Section 3064, <I>Goodwill and
Intangible Assets</I>. For a detailed description of the new accounting
standards, please refer to Note 3 of the unaudited interim consolidated
financial statements. </P>
<P align=justify><B><U>FUTURE ACCOUNTING STANDARDS</U></B><B> </B></P>
<P align=justify><U>Recent Accounting Pronouncements</U></P>
<P align=justify>In January 2009, the Emerging Issues Committee (EIC) of the
Canadian Accounting Standards Board (AcSB) issued EIC Abstract 173, <I>Credit
Risk and Fair Value of Financial Assets and Financial Liabilities</I>, and the
CICA issued Handbook Section 1582, <I>Business Combinations, </I>Section 1601,
<I>Consolidated Financial Statements</I>, and Section 1602, <I>Non-Controlling
Interests</I>. For a detailed description of the future accounting standards,
please refer to Note 4 of the unaudited interim consolidated financial
statements.<B> </B></P>
<P align=justify><U>International Financial Reporting Standards</U></P>
<P align=justify>In February 2008, Canada&#146;s Accounting Standards Board (AcSB)
confirmed that IFRS, as issued by the International Accounting Standards Board,
will replace Canadian generally accepted accounting principles for publicly
accountable enterprises effective for fiscal years beginning on or after January
1, 2011. As a result, the Company will be required to change over to IFRS for
its fiscal 2012 interim and annual financial statements with comparative
information for fiscal 2011.</P>
<P align=justify>In preparation for the changeover to IFRS, the Company has
developed an IFRS transition plan. The Company is currently in the process of
completing its initial phase, comprised of a diagnostic process, which involves
a comparison of the Company&#146;s current accounting policies under Canadian
generally accepted accounting principles with IFRS. The identified differences
will be analyzed and addressed according to the level of impact they will have
on the key elements of the transition plan. These key elements include:
accounting policies, including choices among policies permitted under IFRS;
information technology and data systems; internal control over financial
reporting; disclosure controls and procedures, including investor relations and
external communications plans; and business activities. </P>
<P align=justify>As the IFRS transition plan progresses, the Company will
continue to report on the status of the transition plan and provide more
detailed information of the impact on the key elements indicated above. </P>
<P align=justify><B><U>RELATED PARTY TRANSACTIONS</U></B><B> </B></P>
<P align=justify>We have transactions with Frontier, which manages the
operations of CanAm. These transactions are in the normal course of operations
and are measured at the exchange amount, which is the amount of consideration
established and agreed to by the related parties. Total purchases of yarn from
Frontier were $38.1 million, along with $0.2 million relating to management fees
for the three months ended January 4, 2009. As at January 4, 2009, we had an
outstanding payable to Frontier of $29.9 million. </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.16
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_17></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B><U>INTERNAL CONTROL OVER FINANCIAL REPORTING</U></B><B>
</B></P>
<P align=justify>Management&#146;s annual evaluation and report on the effectiveness
of internal control over financial reporting as of our most recent fiscal year
ended October 5, 2008 was included in the 2008 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 October 5, 2008.
There have been no material changes in internal control over financial reporting
since October 5, 2008.</P>
<P align=justify><B><U>RISKS AND UNCERTAINTIES</U></B><B> </B></P>
<P align=justify>In addition to the risks previously described under the section
&#147;Financial Risk Management&#148;<I> </I>and those described elsewhere in this
MD&amp;A, this section describes the principal risks that could have a material
and adverse effect on our financial condition, results of operations, cash flows
or business, as well as cause actual results to differ materially from our
expectations expressed in or implied by our forward-looking statements. The
risks described below are not the only risks that could affect the Company.
Additional risks and uncertainties not currently known to us or that we
currently deem to be immaterial may also materially and adversely affect our
financial condition, results of operations, cash flows or business.</P>
<P align=justify>The risks described in our 2008 Annual MD&amp;A included
discussions relating to the following important factors: </P>
<UL style="TEXT-ALIGN: justify">
  <LI>Our ability to implement our strategies and plans;
  <LI>Our industry is competitive;
  <LI>Our industry is affected by general economic conditions;
  <LI>Our customers do not commit to purchase minimum quantities;
  <LI>Our production volume may differ from market demand;
  <LI>Our success depends on our ability to anticipate evolving consumer
  preferences and trends;
  <LI>We rely on a relatively small number of significant customers;
  <LI>The price of the raw materials we buy is prone to significant
  fluctuations;
  <LI>We depend on key suppliers;
  <LI>We are subject to international trade regulation;
  <LI>We currently pay income tax at a comparatively low effective rate, which
  could change in the future;
  <LI>Our operations are subject to climate, political, social and economic
  risks;
  <LI>Our operations are subject to environmental regulation;
  <LI>Our business operations significantly rely on our information systems;
  <LI>Our operations could be affected by changes in our relationship with our
  employees or changes to domestic and foreign employment regulations;
  <LI>We may suffer negative publicity if we, or our third party contractors,
  are found to have violated labour laws or engage in labour and other business
  practices that are viewed as unethical; and
  <LI>We depend on key management. </LI></UL>
<P align=justify>For a more detailed discussion of these potential business
risks, readers should review the &#147;Risks and Uncertainties&#148; section of the 2008
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
quarter interim reports similarly filed. </P>
<P align=justify><B><U>DEFINITION AND RECONCILIATION OF NON-GAAP
MEASURES</U></B><B> </B></P>
<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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.17
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_18></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify><B>Adjusted Net Earnings and Adjusted Diluted EPS </B></P>
<P align=justify>To measure our performance from one period to the next, without
the variations caused by the impacts of restructuring and other charges as
discussed on page 7, management uses adjusted net earnings and adjusted diluted
earnings per share, which are calculated as net earnings and 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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2009 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2008 </B></TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions,
      except per share amounts) </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="12%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>Recast</B><SUP>(1</SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net sales </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>184.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>250.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Cost of sales </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>145.1 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">184.9
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gross profit </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>38.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>65.5 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Selling, general and administrative expenses </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>33.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">31.7 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Restructuring and other charges </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>0.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.8 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Operating income </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>4.5 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">33.0 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Financial expense, net </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.7 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Non-controlling
      interest in consolidated joint venture </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(0.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">0.3
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Earnings before income taxes </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>4.7 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>30.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>0.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">2.1
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Net earnings and comprehensive income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>4.4 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>27.9 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Adjustments for: </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp; Restructuring and other
      charges<SUP>(2) </SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>0.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.8 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Adjusted net
      earnings </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>5.3 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">28.7
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Basic EPS </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.04 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">0.23 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Diluted EPS </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.04 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>0.23 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Adjusted diluted
      EPS </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>0.04 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">0.24
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left colSpan=2><FONT size=1><I>Certain minor rounding variances
      exist between the financial statements and this summary. </I></FONT></TD></TR>
  <TR>
    <TD><FONT size=1>&nbsp; </FONT></TD>
    <TD><FONT size=1>&nbsp; </FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I>(1) </I></FONT></TD>
    <TD align=left><FONT size=1><I>Reflects the impact of the
      change in accounting policy as described in Note 3 to the unaudited
    interim consolidated financial statements and the changes to classifications in the
      statement of earnings and comprehensive income as discussed on page 5.</I></FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I>(2) </I></FONT></TD>
    <TD align=left><FONT size=1><I>Adjustment to remove
      restructuring and other charges and the income tax effect thereon. See
      page 7. </I></FONT></TD></TR></TABLE>
<P align=justify><B>EBITDA </B></P>
<P align=justify>EBITDA is calculated as earnings before interest, taxes and
depreciation and amortization and excludes the impact of restructuring and other
charges as discussed on page 7, as well as the non-controlling interest in
consolidated joint venture. 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&#146;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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.18
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_19></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><I>(in $ millions) </I></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>Q1 2009 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">Q1 2008 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="12%">&nbsp;
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">Recast<SUP>(1</SUP></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net earnings </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>4.4 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>27.9 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Restructuring and other charges <SUP>(2) </SUP></TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.9 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">0.8 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Depreciation and amortization </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>15.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Variation in depreciation included in inventories </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>(4.4</B></TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(1.4</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Interest, net </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>0.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Income tax expense </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>0.3 </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">2.1 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>Non-controlling interest of consolidated joint venture </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(0.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>0.3 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff>EBITDA </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff><B>17.6 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%"
    bgColor=#e6efff>44.9 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left colSpan=2><FONT size=1><I>Certain minor rounding variances
      exist between the financial statements and this summary. </I></FONT></TD></TR>
  <TR>
    <TD>
    <p style="margin-right: 10"><FONT size=1>&nbsp; </FONT></TD>
    <TD><FONT size=1>&nbsp; </FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I><SUP>(1) </SUP></I></FONT></TD>
    <TD align=left><FONT size=1><I>Reflects the impact of the
      change in accounting policy as described in Note 3 to the unaudited
      interim consolidated financial statements. </I></FONT></TD></TR>
  <TR vAlign=top>
    <TD align=left>
    <p style="margin-right: 10"><FONT size=1><I><SUP>(2) </SUP></I></FONT></TD>
    <TD align=left><FONT size=1><I>See page 7.
  </I></FONT></TD></TR></TABLE>
<P align=justify><B>Free Cash Flow </B></P>
<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>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>Q1
      2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">Q1
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash flows from operating activities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>15.9 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>103.4 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Cash flows used in investing activities </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>(12.1</B></TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(169.2</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Add back: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Business acquisitions </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%"><B>- </B></TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">126.8 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
      bgColor=#e6efff>&nbsp; &nbsp;Restricted cash related to acquisition </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(0.9</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>10.0 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left>Free cash flow </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="12%"><B>2.9 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="12%">71.0
    </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD></TR></TABLE>
<P align=justify style="margin-top: 0"><I><FONT size=1>Certain minor rounding variances exist between
the financial statements and this summary. </FONT></I></P>
<P align=justify><STRONG>Total Indebtedness and Net Indebtedness </STRONG></P>
<P align=justify>We consider total indebtedness and net indebtedness to be
important indicators of the financial leverage of the Company. </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left><I>(in $ millions)
      </I></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%"><B>Q1
      2009 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">Q4
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">Q1
      2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Current portion of long-term debt </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff><B>3.0 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>3.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>4.6 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Long-term debt </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%"><B>48.2 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">49.4
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="10%">126.2
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Total indebtedness </B></TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff><B>51.2 </B></TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>53.0 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="10%" bgColor=#e6efff>130.8 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Cash and cash
      equivalents </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="10%"><B>(14.4</B></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="10%">(12.4</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="10%">(13.6</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%">)
</TD></TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
      bgColor=#e6efff><B>Net indebtedness </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff><B>36.8 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>40.6 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="10%"
    bgColor=#e6efff>117.2 </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify style="margin-top: 0"><I><FONT size=1>Certain minor rounding variances exist between
the financial statements and this summary. </FONT></I></P>
<P align=justify><B><U>FORWARD-LOOKING STATEMENTS</U></B><B> </B></P>
<P align=justify>Certain statements included in this MD&amp;A constitute
&#147;forward-looking statements&#148; 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 &#147;may&#148;, &#147;will&#148;, &#147;expect&#148;, &#147;intend&#148;, &#147;estimate&#148;,
&#147;anticipate&#148;, &#147;plan&#148;, &#147;foresee&#148;, &#147;believe&#148; or &#147;continue&#148; or the negatives of
these terms or variations of them or similar terminology. We refer you to the
Company&#146;s filings with the Canadian securities regulatory authorities and the
U.S. Securities and Exchange Commission, as well as the &#147;Risks and
Uncertainties&#148; section and the risks described under the section &#147;Financial Risk
Management&#148; of the 2008 Annual MD&amp;A, as subsequently updated in this interim
MD&amp;A for a discussion of the various factors that may affect the Company&#146;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>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.19
</FONT></P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_20></A>
<P align=right><FONT size=1>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS</FONT></P>
<P align=justify>Forward-looking information is inherently uncertain and 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>
<UL style="TEXT-ALIGN: justify">
  <LI>general economic conditions such as commodity prices, currency exchange
  rates, interest rates and other factors over which we have no control;
  <LI>the impact of economic and business conditions, industry trends and other
  external, political and social factors in the countries in which we operate;
  <LI>the intensity of competitive activity;
  <LI>changes in environmental, tax, trade, employment and other laws and
  regulations;
  <LI>our ability to implement our strategies and plans;
  <LI>our ability to complete and successfully integrate acquisitions;
  <LI>our reliance on a small number of significant customers;
  <LI>changes in consumer preferences, customer demand for our products and our
  ability to maintain customer relationships and grow our business;
  <LI>the fact that our customers do not commit to minimum quantity purchases;
  <LI>the seasonality of our business;
  <LI>our ability to attract and retain key personnel;
  <LI>our reliance on computerized information systems;
  <LI>changes in accounting policies and estimates; and
  <LI>disruption to manufacturing and distribution activities due to labour
  disruptions, bad weather, natural disasters and other unforeseen adverse
  events. </LI></UL>
<P align=justify>These factors may cause the Company&#146;s actual performance and
financial results in future periods to differ materially from any estimates or
projections of future performance or results expressed or implied by such
forward-looking statements. Forward-looking statements do not take into account
the effect that transactions or non-recurring or other special items announced
or occurring after the statements are made have on the Company&#146;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&#146;s
expectations regarding the Company&#146;s fiscal 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>February 11, 2009 </P>
<P align=right><FONT size=1>QUARTERLY SHAREHOLDER REPORT &#150; Q1 2009 P.20
</FONT></P>
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#?__9
`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
