Unifi, Inc. reported a profit against a loss in the fiscal fourth quarter ended June 28 due to extensive cost reductions. Sales gained 4.,1 percent in the quarter.

Eddie Ingle, chief executive officer of Unifi, Inc., stated, “We closed fiscal 2026 with clear momentum, highlighted by meaningful improvement in profitability and cash generation. These results reflect disciplined execution of our cost reduction, operational optimization, and portfolio management initiatives, each of which have driven lower our revenue break-even point. As we enter fiscal 2027, Unifi is operating from a healthier financial position, with a more focused cost structure and a balance sheet that we expect to further strengthen through the planned sale of non-strategic real estate assets.”

Fiscal 2026 Fourth Quarter Summary
Net sales increased 4.1 percent to $144.2 million from $138.5 million, primarily due to higher sales from the Brazil Segment, partially offset by tepid customer ordering patterns in the Americas and Asia Segments stemming from geopolitical, trade, and tariff-related uncertainty.

  • Revenues from Repreve Fiber products were $40.2 million and represented 28 percent of net sales.

Gross profit was $14.3 million and gross margin was 9.9 percent, compared to gross loss of $1.1 million and gross margin of  negative 0.8 percent for the fourth quarter of fiscal 2025.

  • Americas Segment gross profit increased by $8.6 million, primarily as a result of multi-year cost reduction efforts.
  • Brazil Segment gross profit increased by $6.4 million, primarily due to favorable pricing dynamics.
  • Asia Segment gross profit increased by $0.5 million, primarily due to an improved sales mix.

SG&A expenses were $11.8 million, a decrease of 1.0 percent from the fourth quarter of fiscal 2025, said to be primarily driven by cost reduction efforts.

Operating income was $2.4 million, compared to $15.1 million in the prior-year period, primarily reflecting the absence of the gain from the sale of a manufacturing facility recognized in the fourth quarter of fiscal 2025, which was partially offset by transition costs.

Net loss for the quarter was $1.2 million, or 6 cents per share, compared to net income of $15.5 million, or 82 cents per shares, in the year-ago quarter, which included a $35.8 million gain on the sale of a manufacturing facility, partially offset by $10.6 million in transition costs.

Adjusted EBITDA was $8.2 million in Q4, versus a loss of $4.1 million in the fourth quarter of fiscal 2025.

Other Financial Items

  • Cash provided by operating activities was $2.1 million during the fourth quarter of fiscal 2026 and $26.5 million during fiscal 2026.
  • Debt principal was $92.4 million and net debt was $67.4 million at June 28, 2026.
  • Following the fourth fiscal quarter, the company entered into an agreement to sell certain non-strategic real estate assets within the Americas Segment for $60.0 million of gross proceeds. See full report at bottom.

Fiscal 2026 Compared to Fiscal 2025

  • Gross margin improved 420 basis points, from 1.5 percent to 5.7 percent.
  • SG&A expenses decreased $4.3 million, from $49.0 million to $44.7 million.
  • Debt principal declined $15.6 million, from $108.0 million to $92.4 million.
  • Cash provided by operating activities increased $47.8 million, from $(21.3) million to $26.5 million.
  • Capital expenditures decreased $5.5 million, from $10.5 million to $5.0 million.

Fiscal 2027 and First Quarter Outlook

During fiscal 2027, the company expects:

  • To focus on leveraging its improved cost footprint while investing in innovation.
  • Managing the balance sheet to ensure that the company remains better positioned to capitalize on improved business conditions and grow over time.
  • Sales and profitability to improve from fiscal 2026 as the company realizes full-year benefits from portfolio management actions, cost containment initiatives, and improved operating execution.

During the first quarter of fiscal 2027, the company expects year-over-year segment results as follows:

  • Brazil Segment sales and profitability to improve as the company leverages its competitive position and advantageous supply chain dynamics.
  • The Asia Segment will remain pressured due to regional softness and geopolitical volatility.
  • Cost savings and stable demand will increase profitability in the Americas Segment with continued growth in margin-accretive revenues from value-added products and Beyond Apparel initiatives.

Ingle concluded, “As we enter fiscal 2027, we are seeing encouraging signs across several areas of our business, including Beyond Apparel, which continues to contribute to our improving financial performance. We remain focused on positioning the business for long-term growth, driving disciplined capital allocation, and executing additional initiatives designed to further strengthen our businesses. While Unifi has entered the new fiscal year in a position of greater financial strength, our focus remains on executing our strategy, serving our customers, and building on the momentum that we have established that will help create long-term value for our shareholders.”

Image courtesy Unifi

 

Unifi Inc. Agrees to Sell Real Estate Assets for $60 Million