SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________________________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
January 21, 2004
UNIFI, INC.
(Exact name of registrant as specified in its charter)
New York
(State or other jurisdiction of incorporation)
1-10542
(Commission File Number)
11-2165495
(IRS Employer Identification No.)
7201 West Friendly Avenue
Greensboro, North Carolina
(Address of principal executive offices)
27410
(Zip Code)
(336) 294-4410
(Registrant's telephone number, including area code)
ITEM 12. RESULTS OF OPERATIONS AND FINANICAL CONDITION
On January 21, 2004, Unifi, Inc. issued a press release announcing the
results for its second quarter of fiscal year 2004 ending December 28,
2003. A copy of the press release is furnished as Exhibit 99.1 to this
report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
UNIFI, INC.
By: /s/ WILLIAM M. LOWE
William M. Lowe
Vice President and Chief
Financial Officer
Dated: January 21, 2004
EXHIBIT INDEX
Exhibit No. Description
99.1
News Release disseminated on January 21, 2004 by Unifi, Inc. concerning
the
results for its Second quarter of fiscal year 2004 ending December 28,
2003.
William M. Lowe, Jr.
Vice President and CFO
(336)316-5664
wmlowe@unifi-inc.com
GREENSBORO, N.C. - - January 21, 2004 - Unifi Inc. (NYSE:UFI), today released operating results for its second quarter of fiscal year 2004.
The Company reported a net loss of $9.2 million or 18 cents per share for the quarter ending December 28, 2003, which compares to a net loss of $2.2 million or 4 cents per share for the prior year December quarter. The Company also reported a net loss of $13.8 million or 26 cents per share for the first half of fiscal 2004 versus net income of $2.2 million or 4 cents per share for the first six months of fiscal 2003.
Net sales for the December quarter of $183.7 million reflect a decrease of 9.0 percent compared to net sales of $201.9 million for the prior year December quarter. Fiscal 2004 year-to-date net sales of $363.9 million reflect a 14.1 percent decrease from net sales of $423.4 million reported for the first six months of fiscal 2003. Net sales decline for the current quarter and year-to-date have been negatively impacted by changes in product mix, the continued increases in imported fabric and apparel, and the ongoing softness in the domestic textile and apparel industries, resulting in an inordinate curtailment of production in the month of December.
Net income for the current quarter was negatively impacted by a reduction in earnings from the Company's unconsolidated equity affiliates, which face the same challenging business and economic conditions as the Company. The Company reported a pre-tax loss of $0.1 million for the current December quarter from its share of income from its equity affiliates compared to pre-tax income of $2.6 million for the prior year December quarter.
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Unifi Announces Second Quarter Results - page 2
Also included in the December 2003 quarterly results is a pre-tax benefit, included in cost of sales, of $7.0 million generated by the Company's manufacturing alliance with DuPont, which is slightly below the $7.8 million benefit realized in the prior year December quarter.
Continuing its ongoing strategic focus on strengthening its balance sheet, the Company ended the December quarter without any funded bank debt and reduced inventories to $115.1 million, a 7.6 percent reduction from inventories of $124.5 million as of the end of September 2003. The Company ended the December quarter with cash-on-hand of $59.3 million.
Brian Parke, chief executive officer for Unifi, said, "The first two quarters of this fiscal year have continued to demonstrate that imports of apparel and home goods at lower price points are continuing to drive production offshore at a steady pace. Our performance in this current quarter reflects this, as well as similar pressures on our equity affiliates."
"Despite the fact that we have reduced our employment base from approximately 5,500 to approximately 4,100 since December 2002, it is obvious that with the continued pressure on pricing, we will be taking further action to reduce our operating costs. In addition, we remain committed to our downstream marketing efforts to counterbalance this trend and to completing our acquisition in China."
Unifi is one of the world's leading producers and processor of textured yarns. Its primary business is the texturing, dyeing, twisting, covering, and beaming of multi-filament polyester and nylon yarns. Unifi's textured yarns are found in home furnishings, apparel and industrial fabrics, automotive, upholstery, hosiery, and sewing thread.
###
Financial Statements to Follow
Unifi Announces Second Quarter Results - page 3
| UNIFI, INC. | |||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
| (Unaudited) (In Thousands Except Per Share Data) | |||||||||||
|
|
|
||||||||||
|
|
|
|
|
||||||||
| Net sales |
$ 183,667
|
$ 201,859
|
$ 363,871
|
$ 423,389
|
|||||||
| Cost of goods sold |
180,003
|
186,910
|
349,621
|
385,323
|
|||||||
| Selling, general & administrative expense |
12,790
|
13,130
|
26,159
|
25,476
|
|||||||
| Interest expense |
4,789
|
5,446
|
9,531
|
10,545
|
|||||||
| Interest income |
(568)
|
(253)
|
(1,396)
|
(746)
|
|||||||
| Other (income) expense, net |
1,092
|
649
|
1,885
|
(70)
|
|||||||
| Equity in (earnings) losses of | |||||||||||
| unconsolidated affiliates |
146
|
(2,605)
|
(111)
|
(6,157)
|
|||||||
| Minority interest (income) expense |
(1,121)
|
758
|
(2,077)
|
3,571
|
|||||||
| Arbitration costs and expenses |
-
|
1,625
|
-
|
2,834
|
|||||||
| Income (loss) before income taxes |
(13,464)
|
(3,801)
|
(19,741)
|
2,613
|
|||||||
| Provision (benefit) for income taxes |
(4,243)
|
(1,631)
|
(5,959)
|
456
|
|||||||
| Net income (loss) |
$ (9,221)
|
$ (2,170)
|
$ (13,782)
|
$ 2,157
|
|||||||
| Earnings (losses) per common share - diluted: | |||||||||||
| Net income (loss) per common share |
$ (0.18)
|
$ (0.04)
|
$ (0.26)
|
$ 0.04
|
|||||||
| Average diluted shares outstanding |
52,098
|
53,782
|
52,422
|
53,830
|
|||||||
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Unifi Announces Second Quarter Results - page
4
| UNIFI, INC. | |||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||
| (Unaudited) (In Thousands) | |||||||||
|
|
|
|
|
||||||
| Assets | |||||||||
| Cash and cash equivalents |
$
11,742
|
$ 59,311
|
$ 72,263
|
$ 76,801
|
|||||
| Receivables |
146,261
|
110,675
|
120,323
|
130,775
|
|||||
| Inventories |
120,062
|
115,110
|
124,520
|
118,436
|
|||||
| Other current assets |
2,679
|
7,723
|
7,963
|
8,235
|
|||||
| Total current assets |
280,744
|
292,819
|
325,069
|
334,247
|
|||||
| Property, plant and equipment |
483,808
|
419,343
|
430,572
|
444,813
|
|||||
| Investments in unconsolidated affiliates |
184,226
|
174,542
|
174,479
|
173,731
|
|||||
| Other noncurrent assets |
44,419
|
35,406
|
35,146
|
35,345
|
|||||
|
$
993,197
|
$ 922,110
|
$ 965,266
|
$ 988,136
|
||||||
| Liabilities and Shareholders' Equity | |||||||||
| Accounts payable |
70,787
|
$ 54,565
|
$ 90,239
|
$ 80,972
|
|||||
| Accrued expenses |
42,308
|
46,529
|
45,404
|
60,288
|
|||||
| Income taxes payable |
256
|
1,293
|
1,647
|
1,729
|
|||||
| Current maturities of long-term debt | |||||||||
| and other current liabilities |
6,986
|
7,021
|
7,285
|
||||||
| Total current liabilities |
|
109,373
|
144,311
|
150,274
|
|||||
| Long-term debt and other liabilities |
281,385
|
258,730
|
258,766
|
259,395
|
|||||
| Deferred income taxes |
84,767
|
81,167
|
85,683
|
87,814
|
|||||
| Minority interests |
13,033
|
9,475
|
9,847
|
10,905
|
|||||
| Shareholders' equity |
497,777
|
463,365
|
466,659
|
479,748
|
|||||
|
|
$ 922,110
|
$ 965,266
|
$ 988,136
|
||||||
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Unifi Announces Second Quarter Results - page
5
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, management's beliefs and assumptions made by management. 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,
the continuation and magnitude of the Company's common stock repurchase
program 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.
-end-