• Q4 net income down 16.5% to $11.3m 
  • Sales down 4.2% to 188m

Yarn producer Unifi saw its fourth quarter net profits fall 16.5%, impacted by lower revenue from affiliates and a $2.7m charge related to an early payment of debt.

Net income for the quarter ended 24 June was US$11.3m. Operating income declined 16% to $6.4m, while net sales slipped 4.2% to $188m.

Meanwhile, for the fiscal year, net income plummeted 54.2% to $11.5m, which the company blamed on higher raw material prices, volume pressure in Brazil and the temporary strengthening of the Brazilian real. Operating income was down 69.9% to $8.6m and net sales dropped 1.1% to $705m.

"We continued to see recovery in volume across all of our operating segments through the second half of the 2012 fiscal year, and margins improved due to the strength of our premier value-added products and polyester raw material cost subsiding from their historically high levels," said Bill Jasper, chairman and CEO of Unifi. 

Show the press release

Unifi Announces Fourth Quarter Results

GREENSBORO, N.C.July 25, 2012 /PRNewswire/ -- Unifi, Inc. (NYSE: UFI) today released preliminary operating results for its fourth quarter and fiscal year ended June 24, 2012.  The Company reported net income for the fourth quarter of the 2012 fiscal year of $11.3 million, or $0.56 per share, compared to net income of $13.5 million, or $0.67 per share, for the prior year quarter ended June 26, 2011.  Net sales declined $8 million or 4.2% to $188 million for the June 2012 quarter compared to net sales of $196 million for the prior year June quarter.  Highlights for the quarter include:

  • Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) of $14.1 million for the June 2012 quarter, which continues the improving trend;
  • Operating results and working capital improvements, resulting in $16.1 million of net cash generated by operating activities;
  • Strong growth continued in our domestic, premier value-added yarn portfolio; and
  • The successful completion of the refinancing of the Company's 2014 Senior Secured Notes, which is expected to result in approximately $9 million of annual interest savings. 

Results for the current quarter were impacted by the early extinguishment of the 11.5% Senior Secured Notes, which were due 2014 and by the Company's entry into a new debt structure.  The Company recorded a $2.7 million charge related to the early extinguishment of debt and also realized a one-time, non-cash income tax benefit of $6.0 million related to the release of certain income tax valuation reserves.  Compared to the June 2011 quarter, earnings were also negatively impacted by a$6.9 million reduction in earnings from the Company's equity investments in unconsolidated affiliates. 

Net sales for the 2012 fiscal year were $705 million, a decline of $8 million or 1.1% compared to the 2011 fiscal year.  The Company is reporting net income of $11.5 million, or $0.57 per share, for the 2012 fiscal year compared to net income of$25.1 million, or $1.25 per share, for the 2011 fiscal year.  In addition to the items previously noted for the quarter, net income for the 2012 fiscal year was negatively impacted by raw material prices approaching historic highs in the first half of the fiscal year and volume pressure in Brazil, as a result of a temporary strengthening of the Real. 

"We continued to see recovery in volume across all of our operating segments through the second half of the 2012 fiscal year, and margins improved due to the strength of our premier value-added products and polyester raw material cost subsiding from their historically high levels," said Bill Jasper, Chairman and CEO of Unifi.  "We also realized converting cost benefits during the March and June quarters as higher utilization rates in our plants and our ongoing focus on cost improvement initiatives resulted in lower per unit manufacturing costs.  Looking forward, we are optimistic the improved performance will continue into our new fiscal year."

Cash-on-hand as of June 24, 2012 was $10.9 million, and total outstanding debt was $121.6 million, which reflects a $47 million reduction of debt from the prior year end, June 26, 2011.  "During the June 2012 quarter, we were pleased to announce the completion of our debt refinancing," said Ron Smith, Chief Financial Officer of Unifi.  "Our new bank facility and term B loan extend the maturity profile of our indebtedness and are expected to result in significant annual interest savings.  The structure also provides us with the availability and flexibility we need to execute on our strategic objectives."

Unifi, Inc. (NYSE: UFI) is a diversified producer and processor of multi-filament polyester and nylon textured yarns and related raw materials. The Company adds value to the supply chain and enhances consumer demand for its products through the development and introduction of branded yarns that provide unique performance, comfort and aesthetic advantages. Key Unifi brands include, but are not limited to: AIO® - all-in-one performance yarns, SORBTEK®, A.M.Y.®, MYNX® UV, REPREVE®, REFLEXX®, MICROVISTA® and SATURA®. Unifi's yarns and brands are readily found in home furnishings, apparel, legwear, and sewing thread, as well as industrial, automotive, military, and medical applications. For more information about Unifi, visit www.unifi.com, or to learn more about REPREVE®, visit the new website www.repreve.com.

SOURCE Unifi, Inc.

 

Original source: http://www.prnewswire.com/news-releases/unifi-announces-fourth-quarter-results-163766856.html