Unifi, Inc. posted net sales of $147.4 million for the fiscal first quarter ended September 29, an increase of 6 percent compared to the first quarter of fiscal 2024. The increase was said to be primarily driven by higher sales volumes in the Brazil Segment, partially offset by severe weather and seasonality impacts in the Americas Segment, and difficult economic conditions in the Asia Segment.
Revenues from Repreve Fiber products were $44.7 million and represented 30 percent of net sales, compared to $42.5 million or 31 percent of net sales for the first quarter of fiscal 2024.
Gross profit was $9.5 million and gross margin was 6.4 percent of net sales, representing a year-over-year improvement versus a gross loss of $0.6 million in the year-ago Q1 period. The improvement was said to be accomplished through existing cost-saving initiatives and increased productivity.
- Americas Segment gross profit improved by $6.0 million, primarily due to higher sales and production levels.
- Brazil Segment gross profit improved by $5.8 million, primarily due to pricing and market share gains.
- Asia Segment gross profit decreased by $1.7 million, primarily due to unfavorable economic conditions and pricing dynamics in the region.
Operating loss was $3.2 million in fiscal 2025 Q1, compared to $12.0 million in fiscal 2024 Q1. The underlying improvement was said to bee primarily due to the increase in gross profit.
Net loss was $7.6 million, or a loss of 42 cents per share, compared to a net loss of $13.3 million, or a loss 73 cents per share, for the first quarter of fiscal 2024.
Adjusted EBITDA was $3.3 million for the fiscal quarter, compared to negative $4.8 million for the first quarter of fiscal 2024.
Subsequent to quarter end, the innovator in recycled and synthetic yarn reportedly entered into an additional $25.0 million credit facility.
“Our financial results for the first quarter were in line with our expectations, highlighting our continued progress toward repositioning our business for future growth,” said Eddie Ingle, CEO, Unifi, Inc. “The strategic initiatives that we put into place during the previous fiscal year have continued to benefit our financial results, which is evident by the significant improvement we experienced in gross profit during the period. To help sustain this positive momentum, we continue to take steps to strengthen our balance sheet, which included entering into a credit agreement that allows us to ensure our capital is deployed to the best long-term investments. We are confident that the improvements we have made to our business so far have positioned us well to enhance our future financial performance and increase shareholder value.”
Fiscal 2025 Outlook
Second Quarter Fiscal 2025
Unifi expects the following second quarter fiscal 2025 results:
- Net sales between $140.0 million and $145.0 million;
- Adjusted EBITDA loss between $4.0 million and $2.0 million;
- Capital expenditures between $4.0 million and $5.0 million; and
- Continued volatility in the effective tax rate.
Full Year Fiscal 2025
Unifi expects the following for fiscal 2025:
- Net sales to increase 10 percent over fiscal 2024, as underlying portfolio and Repreve Fiber momentum continues while macroeconomic and inflationary uncertainties remain pronounced until calendar 2025.
- Gross profit, gross margin, and Adjusted EBITDA expected to increase significantly from fiscal 2024 to fiscal 2025, benefiting from higher sales volumes, initiatives from the previously announced Profitability Improvement Plan, and portfolio strength.
- Capital expenditures of approximately $12.0 million.
Ingle concluded, “We are excited about the opportunities that lie ahead of us for both our Repreve Fiber business and our growing beyond apparel initiatives, which we believe are poised to benefit from the growing customer demand for sustainable solutions. As we look ahead, we will continue to focus on diligently managing our operations, maintaining a healthy balance sheet, and driving future growth that will help create value for all our stakeholders.”
Image courtesy Unifi, Inc.