Unifi Announces Updates to Quarterly Performance
UFI) today announced that it is revising its Adjusted EBITDA guidance for its
2009 second fiscal quarter, which will end
range of
on its earnings call on
included below). The revised guidance is a result of significant decreases in
consumer spending coupled with high supply chain inventories across the
Company’s key business segments. Reductions in the Company’s orders across
the quarter were a result of sharp year-over-year declines of 4% in October
and 7% in November of retail apparel sales, 11% in October and 13% in November
of retail furnishing sales and a 16% year-to-date decline in automotive sales.
“We are disappointed in having to revise our guidance at this time,
particularly after the significant improvements we have made to our business
in the past year,” said
expected the December quarter to be a very challenging one, but the speed and
severity of the declines in spending have been much greater than anticipated.
We expect sales to recover somewhat during the first six months of calendar
2009, as supply chain inventories get replenished, even though consumer
spending is expected to remain weak. Accordingly, we now expect Adjusted
EBITDA for the 2009 fiscal year to be in the range of
continue to face these challenges with a solid balance sheet and strong
liquidity, and we remain committed to our strategies. Our emphasis remains on
controlling costs and optimizing the supply chain supporting our base
business, while focusing on growing our premium value-added products and our
operations in
The Company also announced that it has closed on the sale of certain real
property and related assets located in
The sale will result in net proceeds of
pre-tax gain of
Furthermore, the Company announced that
from asset sales of collateral has become “Excess Collateral Proceeds” under
the terms of the Company’s Indenture for its
Notes (“Bonds”). While there is no requirement in the Indenture to use
Excess Collateral Proceeds to offer to repurchase the Bonds (at par) prior to
the time the amount of Excess Collateral Proceeds reaches
Company may elect, from time to time, to make such offers earlier, at its
discretion. Additionally, the Company may also from time to time seek to
retire or purchase a portion of the Bonds in open market purchases, in
privately negotiated transactions or otherwise. Such retirement or purchases
of the Bonds may come from the operating cash flows of the business or other
sources and will depend upon prevailing market conditions, liquidity
requirements, contractual restrictions and other factors, and the amounts
involved may be material.
Adjusted EBITDA represents pre-tax income before interest expense,
depreciation and amortization expense and loss or income from discontinued
operations, adjusted to exclude restructuring charges, SG&A severance charges,
equity in earnings and losses of unconsolidated affiliates, write down of
long-lived assets and equity affiliates, non-cash compensation expense, gains
and losses on sales of property, plant and equipment, hedging gains and
losses, deposit write offs, asset consolidation and optimization expense, and
measure of its performance and ability to service debt. The Company also
presents Adjusted EBITDA because it believes such measure is frequently used
by securities analysts, investors and other interested parties in the
evaluation of companies in its industry and in measuring the ability of “high-
yield” issuers to meet debt service obligations. It is not practical to
provide a reconciliation of the Company’s 2009 second fiscal quarter or 2009
fiscal year forecasted Adjusted EBITDA to the most directly comparable GAAP
measure, pre-tax income, because certain items cannot be reasonably estimated
or predicted at this time.
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(R) – all-in-one performance yarns,
SORBTEK(R), A.M.Y.(R), MYNX(R) UV, REPREVE(R), REFLEXX(R), MICROVISTA(R) and
SATURA(R). 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(R), visit the new website
www.repreve.com.
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
Certain statements included herein contain forward-looking statements
within the meaning of federal security laws about Unifi, Inc.’s (the
“Company”) financial condition and results of operations that are based on
management’s current expectations, estimates and projections about the markets
in which the Company operates, as well as management’s beliefs and
assumptions. Words such as “expects,” “anticipates,” “believes,” “estimates,”
variations of such words and other similar expressions are intended to
identify such forward-looking statements. These statements are not guarantees
of future performance and involve certain risks, uncertainties and
assumptions, which are difficult to predict. Therefore, actual outcomes and
results may differ materially from what is expressed or forecasted in, or
implied by, such forward-looking statements. Readers are cautioned not to
place undue reliance on these forward-looking statements, which reflect
management’s judgment only as of the date hereof. The Company undertakes no
obligation to update publicly any of these forward-looking statements to
reflect new information, future events or otherwise.
Factors that may cause actual outcome and results to differ materially
from those expressed in, or implied by, these forward-looking statements
include, but are not necessarily limited to, availability, sourcing and
pricing of raw materials, pressures on sales prices and volumes due to
competition and economic conditions, reliance on and financial viability of
significant customers, operating performance of joint ventures, alliances and
other equity investments, technological advancements, employee relations,
changes in construction spending, capital expenditures and long-term
investments (including those related to unforeseen acquisition opportunities),
continued availability of financial resources through financing arrangements
and operations, outcomes of pending or threatened legal proceedings,
negotiation of new or modifications of existing contracts for asset management
and for property and equipment construction and acquisition, regulations
governing tax laws, other governmental and authoritative bodies’ policies and
legislation, and proceeds received from the sale of assets held for disposal.
In addition to these representative factors, forward-looking statements could
be impacted by general domestic and international economic and industry
conditions in the markets where the Company competes, such as changes in
currency exchange rates, interest and inflation rates, recession and other
economic and political factors over which the Company has no control. Other
risks and uncertainties may be described from time to time in the Company’s
other reports and filings with the Securities and Exchange Commission.
SOURCE Unifi, Inc.