Yarn producer Unifi saw its losses narrow in the company's fiscal second quarter, despite incurring charges related to the restructuring of the business.

The net loss for the three months ended 23 December was US$7.7m, down from a net loss of $18.2m during the same period in fiscal 2007.

The fiscal 2008 figure was impacted by $5.9m in restructuring and severance charges, and a $2.2m impairment charge. Net sales were $183.4m, compared to $156.9m the year before.

For the first half of 2008, Unifi posted a net loss of $16.9m, compared to $28.3m in fiscal 2007. Sales increased from $326.8m to $353.9m.

"The continuing improvement in our operating results reflects the positive impact of our strategies to consolidate the US market and to reposition the company in the commodity partially oriented yarn market," said Unifi CFO Ron Smith.

"Volume in the current quarter stayed stronger than anticipated, despite retail performance and pressure from significant unexpected losses in raw material prices.

"These raw material increases were related to temporary issues within the global supply chain, and we expect prices to remain stable throughout the March quarter."