Home / Knowledge / News / Textiles / Sales of Unifi up 10.6% in Q1FY19

Sales of Unifi up 10.6% in Q1FY19

31
Oct '18
Courtesy: Unifi
Courtesy: Unifi
The net sales of Unifi, of the leading innovators in recycled and synthetic yarns, has increased $17.4 million, or 10.6 per cent, to $181.6 million in the first quarter of fiscal 2019, compared to $164.2 million for the first quarter of fiscal 2018. It increased $24.0 million, or 14.6 per cent, when excluding the impact of foreign currency translation.

Revenues from premium value-added (PVA) products grew 10.1 per cent compared to the first quarter of fiscal 2018, or 14.4 per cent when excluding the impact of foreign currency translation, and represented approximately 43 per cent of consolidated net sales.

During the reported period, gross margin was 11.0 per cent, compared to 14.2 per cent for the first quarter of fiscal 2018, impacted by higher costs, including raw materials, and a less favorable sales mix. Operating income was $5.7 million, compared to $10.2 million for the first quarter of fiscal 2018, impacted by lower gross profit and incremental selling, general and administrative expenses.

Net income was $1.8 million in the first quarter of fiscal 2019, compared to $9.0 million for the first quarter of fiscal 2018. Net income for the first quarter of fiscal 2019 was adversely impacted by comparatively higher operating expenses, $2.9 million less in pre-tax earnings from PAL and a higher effective tax rate. Diluted EPS was $0.10 for the first quarter of fiscal 2019 and $0.48 for the first quarter of fiscal 2018.

"We continued to execute on our strategy of driving sales with our PVA portfolio as our team delivered its sixth consecutive quarter of sales growth. Our PVA portfolio, including the sustainable Repreve platform, continues to distinguish us in the global market. While we are proud of our overall sales growth, profitability fell below expectations as raw material costs rose again. Similarly, profitability for the Parkdale joint venture fell below expectations due to higher cotton costs. We saw sales benefit from our recently acquired dyed business and remain upbeat on the outlook for this venture even though we are incurring some short-term integration costs.  Unifi has and will continue to take pricing actions to counterbalance rising input costs while focusing on improving margins by delivering innovative and sustainable solutions necessary to achieve profitable long-term growth," said Kevin Hall, chairman and CEO of Unifi.

The company's second quarter gross profit will be unfavourably impacted by a surge in polyester raw material costs in September, which was driven by higher global demand and tighter supply for polyester feedstocks, and a seasonal shut-down period in December 2018, which will occur in the company's second quarter rather than the third quarter as it did in the prior year.  Therefore, the company's expectations for net sales and capital expenditures remain unchanged, while the high end of the range of expectations for operating income and adjusted EBITDA growth has been reduced. Consistent with these expectations, and having greater clarity on the effects of recent tax reform legislation, the company has increased its effective tax rate outlook.  However, the company expects cash tax payments as a percentage of income before income taxes to be in the mid-30 per cent range. 

"Raw material costs have been rising over the last four quarters, and there was a dramatic jump in polyester costs in September that will place even more pressure on our second quarter profitability. While this rise is clearly a headwind, we anticipate a better relationship between pricing and cost in the second half of the year.  This would benefit our third and fourth quarters, returning our profitability to the lower end of our original expectations," said Kevin Hall, Chairman and CEO of Unifi. "We will continue to address input cost pressures with responsive pricing actions, while focusing on increased sales of innovative solutions that we believe will provide us the portfolio differentiation necessary to achieve long-term growth.  We look forward to providing more detail on our strategic growth plan for the next few years during our Investor Day on November 15." (RR)

Fibre2Fashion News Desk – India


Must ReadView All

Pic: Shutterstock

Textiles | On 15th Jun 2021

EURATEX urges EU, US to establish level playing field for industry

Ahead of the EU-US Summit today, the European textile and apparel...

Pic: Shutterstock

Textiles | On 15th Jun 2021

Australia, UK agree on broad terms of trade deal

Prime Ministers Scott Morrison and Boris Johnson have agreed in...

Pic: Shutterstock

Textiles | On 15th Jun 2021

Germany passes law on corporate due diligence in rights, environment

The German parliament passed a law last week that warrants large and...

Interviews View All

Footwear Industry, Footwear Retailers

Footwear Industry
Footwear Retailers

Still struggling to mop up higher sales

Florian Heubrandner, Lenzing AG

Florian Heubrandner
Lenzing AG

Sustainable and eco-friendly fibres remain in the minority

Textile Industry, Head honchos

Textile Industry
Head honchos

Verticals like fast fashion won’t completely adopt personalisation on...

Meghavi Suthar,

Meghavi Suthar

Founded by NIFT graduate <b>Meghavi Suthar </b>in 2017, Kala is an...

Yawer Ali Shah,

Yawer Ali Shah

Synthetic colours and dyes were all the rage till the very first ban on...

Shambhu Nath Jha,

Shambhu Nath Jha

Leading research and consulting firm Fact.MR recently launched a report on ...

Suresh Patel, Non Woven Federation of India

Suresh Patel
Non Woven Federation of India

The Non Woven Federation of India (NWFI), representing the regional...

Silverio Baranzano, Fitesa

Silverio Baranzano
Fitesa

Fitesa is a leader in the nonwoven fabrics industry, specialising in...

Sachin Pendharkar, Dieffenbacher India Pvt Ltd

Sachin Pendharkar
Dieffenbacher India Pvt Ltd

Germany-based Dieffenbacher Group is a producer of high-quality composites ...

Archana Jaju, Label Archana Jaju

Archana Jaju
Label Archana Jaju

<b>Archana Jaju</b>’s Hyderabad-based eponymous label works with artisans...

Megha Kumari & Jigar Mali, Label Megha & Jigar

Megha Kumari & Jigar Mali
Label Megha & Jigar

New Delhi based label Megha &amp; Jigar blends India's unique handcrafts...

Shalini Sharma & Shweta Pundir Sharma, Six Yard Story

Shalini Sharma & Shweta Pundir Sharma
Six Yard Story

Six Yard Story is a premium artisanal brand with a focus to bring handloom ...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


June 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search