Home / Knowledge / News / Textiles / Unifi gross margin rises 10% in Q3FY18
Unifi gross margin rises 10% in Q3FY18
28
Apr '18
Unifi gross margin rises 10% in Q3FY18
The gross margin of Unifi, one of the world's leading innovators in synthetic and recycled yarns, for the third quarter of fiscal 2018 has increased 10.0 per cent, compared to 13.1 per cent for the third quarter of 2017, impacted by elevated raw material costs and volume and sales mix challenges. For nine months of 2018, gross margin was 12.6 per cent.

Net sales increased $5.0 million, or 3.1 per cent, to $165.9 million, compared to $160.9 million for the third quarter of fiscal 2017, and increased $4.6 million, or 2.9 per cent, when excluding the impact of foreign currency translation. For the reported period, revenues from premium value-added ("PVA") products grew 17 per cent compared to the third quarter of fiscal 2017, and represented approximately 44 per cent of consolidated net sales.

The company's operating income was recorded at $1.6 million, compared to $9.1 million for the third quarter of fiscal 2017, impacted by a decline in gross profit, an increase in selling, general and administrative expenses, and foreign currency losses.

"As we previously announced, our performance during the third quarter was below our expectations," said Kevin Hall, chairman and CEO of Unifi.  "We were unable to counterbalance large headwinds that significantly weighed on short-term profitability. Persistently rising raw material costs, the difficult domestic landscape, sales mix challenges and foreign currency losses were the primary drivers of the disappointing bottom-line performance. In a heightened raw material cost environment, our pricing actions tend to lag behind the cost increases, but we believe we can correct this imbalance as raw material prices stabilise."

Adjusted EBITDA was $7.3 million for the third quarter of fiscal 2018, compared to $14.4 million for the third quarter of fiscal 2017. The decrease in Adjusted EBITDA resulted primarily from the combination of rising raw material costs, domestic volume and sales mix challenges, and foreign currency losses that could not be offset quickly enough with higher selling prices and cost mitigation measures.

The company continues to expect sales volume growth driving revenue growth in the low-to-mid single digit percentage range for the year. However, many of the challenges that impacted the third quarter's profitability remain ongoing. Thus, while fourth quarter profitability is expected to improve over third quarter results, the company expects fiscal 2018 operating income and adjusted EBITDA to be well below fiscal 2017 results. Capital expenditures are expected to total $28 million, which is $2 million below the prior outlook, and the ongoing effective tax rate is still expected to be in the mid-20 per cent range.

"We remain committed in our efforts to expand our commercial capabilities as cost effectively as possible, while continuing to secure our position as the sustainability partner of choice, with a constant focus on recycling and innovation. We are focused on driving both top-line and bottom-line growth over the long-term, which will help us deliver on our goal of maximizing long-term shareholder value," Hall concluded. (RR)

Fibre2Fashion News Desk – India


Must ReadView All

Courtesy: Businesswire/PrimaLoft

Textiles | On 18th Nov 2018

PrimaLoft unveils PrimaLoft Bio Performance Fabric

PrimaLoft, a leader in advanced material technology, has unveiled...

Higher sales and earnings at Macy's in Q3FY18

Fashion | On 18th Nov 2018

Higher sales and earnings at Macy's in Q3FY18

Higher sales and earnings were recorded at Macy’s, one of the premier ...

Courtesy: Amazon

Apparel/Garments | On 18th Nov 2018

Amazon's new headquarters in New York City, Arlington

Amazon is setting up two new headquarters, one in New York City and...

Interviews View All

Victor Chao, Esmetex

Victor Chao
Esmetex

‘In future, clothing boundary lines will become increasingly blurred.’

Top executives, Fashion houses, India

Top executives
Fashion houses, India

With technology, it has become easier to ensure IPR

Sanjay Desai & Ashish Mulani, True Colors

Sanjay Desai & Ashish Mulani
True Colors

Digital textile printing will be the technology of the future

Farheen B Rahman & Priti Jain,

Farheen B Rahman & Priti Jain

Founded by business-designer duo <b>Priti Jain and Farheen Rahman</b>,...

Harssh Chheda,

Harssh Chheda

Mumbai-based Corporate Collars provides bespoke tailoring services for...

Pietro Turrin,

Pietro Turrin

Industrie Tessili Bresciane (ITB) has served numerous industries and...

Razvan Popescu, Directa Plus SpA

Razvan Popescu
Directa Plus SpA

Directa Plus is one of the largest producers and suppliers worldwide of...

Larry L Kinn, Suominen Corporation

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Alfonso Marra, Klopman

Alfonso Marra
Klopman

It was in 1968 that Klopman introduced the concept of poly/cotton workwear ...

Sanjukta Dutta, Sanjukta's Studio

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Akta Adani, India Boulevard

Akta Adani
India Boulevard

India Boulevard is a San Francisco-based curated fashion marketplace that...

Chandani Sahi, By Chandani

Chandani Sahi
By Chandani

By Chandani is a womenswear prêt couture brand with fusion silhouettes by...

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


November 2018

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

news category


Related Categories:

Advanced Search