UPDATE 2-Gildan shares plummet after 2008 profit estimates cut

(Updates trading, adds details) (In U.S. dollars unless noted)

TORONTO, April 29 (Reuters) - Shares of Gildan Activewear Inc (GIL.TO: Quote, Profile, Research) shed more than 30 percent on Tuesday after the T-shirt maker cut its full year and second-quarter earnings forecasts on Tuesday, hurt by lower-than-expected sales growth amid sluggish output at a Dominican Republic facility.

The company said it expects adjusted diluted earnings per share of 35 cents in the second quarter, down from its previous estimate of 42 cents. The company cut its 2008 forecast to $1.45-$1.50 a share, from $1.85-$1.90.

Gildan was the biggest net decliner on the Toronto Stock Exchange, diving C$10.59, or 29.2 percent, to C$25.67 in afternoon trading. It had earlier fallen as low as C$24.07.

Gildan said the revision was due to slower-than-expected sales growth of its activewear amid a shortfall in output at its textile factory in the Dominican Republic.

A writedown of inventories of discontinued product lines as Gildan integrates its sock products and the additional costs of servicing retailers during the integration of information systems also contributed to the lowered forecast.

Gildan said these issues were partially offset by a more favorable product mix and lower than expected promotional discounts by U.S. wholesale distributors.

In a research note, Sara O'Brien, analyst with RBC Capital Markets, said the integration of its acquisition of hosiery manufacturer Kentucky Derby Hosiery Co had led to disruptions in the second quarter, including the writedown.

The integration had also led to missed retail sales volumes, and additional distribution and freight costs to get products on shelves on time, the research note said.