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Unifi to focus on internal resources for downstream initiatives
29 Jul '05
5 min read
The proceeds from the sale of the Company's land and buildings located in Ireland, which closed on June 30, 2005, are not included in this figure.
- Reduced inventories by $32.0 million in the quarter.
- Reduced its receivables balance by $14.2 million during the quarter, excluding the Collins & Aikman bad debt write-off.
Subsequent to the end of the current June quarter, the Company utilized $24.4 million of cash to pay off the five-year note to INVISTA, derived from the purchase of the INVISTA polyester POY assets.
"They are entering their 2006 fiscal year with one of the strongest balance sheets and business models in years, which will allow us to stay focused on executing their domestic and global growth strategies," said Bill Lowe, Chief Operating Officer and CFO for Unifi.
"Although the results posted on their income statement for their 2005 fiscal year were generally as expected, the significant progress on working capital reduction made during the fourth quarter leaves their balance sheet stronger than anticipated.
In their POY or spinning business, the integration of Kinston is running ahead of schedule, and across all business units, they took the necessary step of drastically adjusting inventory levels, including selling off their aged inventory, which had a negative impact on their gross margin for the current quarter of approximately $3.9 million.
They have lowered selling, general and administrative (SG&A) expenses from 6.9 percent of sales for their 2004 fiscal year to 5.4 percent for the current fiscal year, and they are confident that they can maintain SG&A at a level of 5.0 percent or lower in their 2006 fiscal year. All of this points to a healthier business for Unifi in the upcoming fiscal year.
- Reduced inventories by $32.0 million in the quarter.
- Reduced its receivables balance by $14.2 million during the quarter, excluding the Collins & Aikman bad debt write-off.
Subsequent to the end of the current June quarter, the Company utilized $24.4 million of cash to pay off the five-year note to INVISTA, derived from the purchase of the INVISTA polyester POY assets.
"They are entering their 2006 fiscal year with one of the strongest balance sheets and business models in years, which will allow us to stay focused on executing their domestic and global growth strategies," said Bill Lowe, Chief Operating Officer and CFO for Unifi.
"Although the results posted on their income statement for their 2005 fiscal year were generally as expected, the significant progress on working capital reduction made during the fourth quarter leaves their balance sheet stronger than anticipated.
In their POY or spinning business, the integration of Kinston is running ahead of schedule, and across all business units, they took the necessary step of drastically adjusting inventory levels, including selling off their aged inventory, which had a negative impact on their gross margin for the current quarter of approximately $3.9 million.
They have lowered selling, general and administrative (SG&A) expenses from 6.9 percent of sales for their 2004 fiscal year to 5.4 percent for the current fiscal year, and they are confident that they can maintain SG&A at a level of 5.0 percent or lower in their 2006 fiscal year. All of this points to a healthier business for Unifi in the upcoming fiscal year.
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