Unifi, Inc., the maker of Repreve and an innovator in recycled and synthetic yarns, reported that net sales amounted to $146.6 million for the fiscal 2025 third quarter ended March 30, compared to $149.0 million in the prior-year Q3 period. The company said the decline was primarily due to a weaker sales mix and lower sales volumes for the Asia segment and unfavorable foreign currency effects in the Brazil segment, partially offset by higher sales volumes in the Americas segment.

  • Revenues from Repreve Fiber products were $44.7 million, or 31 percent of net sales, in the fiscal Q3 period, compared to $46.7 million, or 31 percent of net sales, for the third quarter of fiscal 2024.

Gross profit decreased to negative $0.4 million in Q3, compared to $4.8 million in the fiscal 2024 Q3 period.

  • Americas segment gross profit decreased by $3.4 million, primarily as production and sales gains were offset by inflationary pressures and transition costs related to the manufacturing footprint reduction.
  • Asia segment gross profit decreased by $0.9 million, primarily due to lower sales volumes, a less favorable sales mix, and pricing dynamics in the region.
  • Brazil segment gross profit decreased by $0.8 million, primarily due to unfavorable foreign currency translation effects.

The consolidated operating loss increased to $13.9 million in Q3, compared to $6.9 million in the prior-year Q3 period. The underlying increase was primarily due to the decrease in gross profit.

The net loss for the period amounted to $16.8 million, compared to $10.3 million in the prior-year period. The Adjusted net loss was $13.9 million in Q3, which excluded $2.9 million of transition costs, compared to an Adjusted net loss of $10.3 million in the third quarter of fiscal 2024.

Adjusted EBITDA was negative $4.9 million, which excluded the same adjustment, compared to $0.8 million in the prior-year period.

“Our results for the third quarter were in line with our expectations, driven by an improved performance in our Americas segment due to the positive traction we have experienced with the growth of our business in Central America,” offered Eddie Ingle, CEO of Unifi, Inc. “On the efficiency front, we have made progress on optimizing the cost structure of our U.S. operations. In addition, once finalized, the sale of our Madison, North Carolina manufacturing facility will allow us to reduce our outstanding debt and enhance our financial position.

“As we look ahead to the remainder of calendar 2025, we expect to see further benefits from our restructuring actions, which will improve our cost structure and operational performance. This gives us confidence that UNIFI is well-positioned to pivot to growth,” continued Ingle.

Update on Manufacturing Transition
In February 2025, Unifi announced the closure and planned transition of certain domestic manufacturing operations to enhance operating efficiency, lower fixed costs, improve profitability, and further strengthen the balance sheet. The associated real estate sale is pending final closing and funding, expected on May 15, 2025.

The manufacturing transition and restructuring charges will continue through the first quarter of fiscal 2026 as specific machinery and equipment are relocated to other manufacturing facilities in North America and Central America, with no expected reduction in capacity or customer service during or after the transition.

Following the reduction in manufacturing footprint, Unifi expects to achieve an annual cost savings of approximately $20.0 million, primarily due to lower headcount and operational synergies.

Fiscal 2025 Q4 Outlook
Unifi expects the following fourth quarter fiscal 2025 results:

  • Net sales and Adjusted EBITDA will improve sequentially from the third quarter of fiscal 2025, primarily driven by further recovery for the Americas Segment.
  • Continued restructuring and transition expenses, primarily equipment relocation and abandonment costs, of between $6.0 million and $8.0 million.
  • Continued volatility in the effective tax rate.

The company said the outlook assumes no meaningful changes in business activities resulting from the evolving tariff and trade negotiations.

“While there continues to be uncertainty around the global macroeconomic environment, we believe we have taken steps to improve our business in order to put Unifi in a strong position to support our customers’ needs with sustainable and innovative products that will help create a more circular economy and position the company for future growth. Looking ahead, we will continue to focus on finding additional ways to optimize our operations, improve our financial performance, accelerate our revenues, and create value for our shareholders,” Ingle concluded.

Image courtesy Unifi, Inc.