Company to streamline operations and reset
costs to enhance margin and profitability
Board promotes multiple leaders to drive
critical strategic initiatives through appointments of Chief
Financial Officer, Chief Product Officer, President of Unifi
Manufacturing, Inc., and Expanded General Counsel Role
UNIFI, Inc. (NYSE: UFI) (together with its consolidated
subsidiaries, “UNIFI”), makers of REPREVE and one of the world’s
leading innovators in recycled and synthetic yarns, today announced
that it has begun the implementation of a new Profitability
Improvement Plan, focused on further reducing the Company’s costs,
streamlining operations, and investing in innovation. The Company
also announced new executive officer appointments to critical
roles.
Highlights:
- Profitability Improvement Plan includes:
- Cost reset and headcount reductions that are expected to lower
expenses by $10 million to $15 million annually
- Sales transformation initiatives focused on improving
efficiencies and processes expected to bolster operating margins by
$6 million annually
- Savings are expected to be invested into margin accretive
opportunities and product innovation for REPREVE and will be used
to strengthen the Company’s financial profile beyond actions taken
to date
- A.J. Eaker promoted to Executive Vice President and Chief
Financial Officer
- Meredith S. Boyd promoted to Executive Vice President and Chief
Product Officer
- Brian D. Moore promoted to Executive Vice President and
President of Unifi Manufacturing, Inc.
- Gregory K. Sigmon promoted to Executive Vice President, General
Counsel and Corporate Secretary, with expanded leadership
responsibilities over Sustainability and Government Affairs
functions.
“In recognition of the current operating environment, we
recently implemented an extensive Profitability Improvement Plan to
optimize our resources,” said Eddie Ingle, CEO of Unifi, Inc.
“While this Plan came with difficult decisions, these measures will
significantly improve profitability, helping to ensure UNIFI has a
robust foundation to foster growth and innovation, core tenets of
the Company’s strategy. Additionally, the transformation of our
sales processes will serve as a direct catalyst to improve gross
margins and operational efficiencies. Savings from these
initiatives will be reinvested in the business, first in areas that
should help us accelerate growth as demand levels reach the
expected rebound across our industry in calendar 2024, and then to
bolster the our balance sheet and already strong financial
profile.”
Ingle continued, “We have streamlined our organization and
realigned our Leadership Team to support a more efficient and
responsive go-to-market structure. Collectively these actions will
better prepare the business to deliver stronger results as our
industry pivots to growth in calendar 2024. Over the last decade we
have focused on leadership development within our organization, and
we are therefore very proud to announce promotions of talented
leaders like A.J., Meredith, Brian, and Greg. Each has extensive
experience and proven track records at UNIFI that have been
invaluable to the organization and our customers. The Board and I
are thrilled to complete the leadership appointments and
promotions, as they will make strong impacts on their respective
teams and help drive the future growth of our Company.”
Profitability Improvement
Plan
UNIFI began the implementation of an extensive Profitability
Improvement Plan in December 2023. The first part of this strategy
realigned resources, reduced headcount and further reset costs,
which lowers the Company’s variable operating expenses in both
production and administrative activities in the United States.
These actions have been completed and are expected to reduce
expenses by $2.5 million per quarter at the start of fiscal 2025.
The Company recorded a severance charge of $2.4 million during the
December 31, 2023 quarter as a result.
The second part of the Profitability Improvement Plan is focused
on gross margin expansion initiatives through a transformation of
the Company’s sales process. This transformation includes actions
designed to streamline processes, improve inventory management, and
realign resources to maximize efficiencies in the current and
future operating environment.
The total reduction in costs and anticipated profitability
improvement as a result of the execution of this Plan is expected
to reach $20 million on an annual run-rate basis at the start of
fiscal 2025. The Company plans to reinvest these savings into areas
of the business that will create additional revenue and margin
accretive opportunities beyond the traditional apparel market it
serves today.
Leadership Appointments
A.J. Eaker has been appointed Executive Vice President and Chief
Financial Officer. Mr. Eaker served as Interim Chief Financial
Officer of UNIFI since August 2023, as Treasurer since December
2022, and as Vice President of UNIFI's primary domestic operating
subsidiary since June 2017. Mr. Eaker has held various positions
with increasing leadership and functional responsibilities since
joining the Company in March 2014, including Vice President of
Finance, Corporate Finance Manager, and Assistant Controller,
following more than five years in public accounting.
Meredith S. Boyd has been appointed Executive Vice President and
Chief Product Officer. Ms. Boyd previously served as Senior Vice
President of Sustainability, Technology & Innovation for the
last three years and joined UNIFI in 2007. She has been
instrumental in driving international growth and product
differentiation, particularly in sustainable practices. Her
expertise spans multiple roles, including Global Business
Development and Brand Sales, and she has been a prominent figure in
industry conferences and publications.
Brian D. Moore has been appointed Executive Vice President and
President of Unifi Manufacturing, Inc., the Company’s primary
operating subsidiary in the United States. Mr. Moore previously
served as Senior Vice President of Direct Sales & Operations,
leading various aspects of the United States sales team for the
past year, after serving as Vice President of Global Brand Sales
from 2020 to 2023. Mr. Moore first joined UNIFI in 1993, eventually
leading UNIFI’s Asian market and gaining extensive experience in
various sectors of the textile industry through transforming sales
and operations for global fashion and apparel companies before
returning to UNIFI in 2020. His leadership and experience
underscores his capability to steer the manufacturing division
effectively.
Second Quarter Fiscal 2024 Earnings
Conference Call
UNIFI will provide additional commentary regarding these
initiatives during its second quarter fiscal 2024 earnings
conference call on February 1, 2024, at 8:30 a.m., Eastern Time.
The call can be accessed via a live audio webcast on UNIFI’s
website at http://investor.UNIFI.com. Additional supporting
materials and information related to the call will also be
available on UNIFI’s website.
About UNIFI
Unifi, Inc. (NYSE: UFI) is a global textile solutions provider
and one of the world's leading innovators in manufacturing
synthetic and recycled performance fibers. Through REPREVE, one of
UNIFI's proprietary technologies and the global leader in branded
recycled performance fibers, UNIFI has transformed more than 40
billion plastic bottles into recycled fiber for new apparel,
footwear, home goods, and other consumer products. UNIFI
continually innovates technologies to meet consumer needs in
moisture management, thermal regulation, antimicrobial protection,
UV protection, stretch, water resistance, and enhanced softness.
UNIFI collaborates with many of the world's most influential brands
in the sports apparel, fashion, home, automotive, and other
industries. For more information about UNIFI, visit
www.unifi.com.
Cautionary Statement on Forward-Looking
Statements
Certain statements included herein contain “forward-looking
statements” within the meaning of federal securities laws about the
financial condition and results of operations of UNIFI that are
based on management’s beliefs, assumptions and expectations about
our future economic performance, considering the information
currently available to management. An example of such
forward-looking statements include, among others, guidance
pertaining to our financial outlook. The words “believe,” “may,”
“could,” “will,” “should,” “would,” “anticipate,” “plan,”
“estimate,” “project,” “expect,” “intend,” “seek,” “strive” and
words of similar import, or the negative of such words, identify or
signal the presence of forward-looking statements. These statements
are not statements of historical fact, and they involve risks and
uncertainties that may cause our actual results, performance or
financial condition to differ materially from the expectations of
future results, performance or financial condition that we express
or imply in any forward-looking statement.
Factors that could contribute to such differences include, but
are not limited to: the competitive nature of the textile industry
and the impact of global competition; changes in the trade
regulatory environment and governmental policies and legislation;
the availability, sourcing and pricing of raw materials; general
domestic and international economic and industry conditions in
markets where UNIFI competes, including economic and political
factors over which UNIFI has no control; changes in consumer
spending, customer preferences, fashion trends and end uses for
products; the financial condition of UNIFI’s customers; the loss of
a significant customer or brand partner; natural disasters,
industrial accidents, power or water shortages, extreme weather
conditions and other disruptions at one of our facilities; the
disruption of operations, global demand, or financial performance
as a result of catastrophic or extraordinary events, including
epidemics or pandemics such as the recent strain of coronavirus;
the success of UNIFI’s strategic business initiatives; the
volatility of financial and credit markets; the ability to service
indebtedness and fund capital expenditures and strategic business
initiatives; the availability of and access to credit on reasonable
terms; changes in foreign currency exchange, interest and inflation
rates; fluctuations in production costs; the ability to protect
intellectual property; the strength and reputation of our brands;
employee relations; the ability to attract, retain and motivate key
employees; the impact of climate change or environmental, health
and safety regulations; and the impact of tax laws, the judicial or
administrative interpretations of tax laws and/or changes in such
laws or interpretations.
All such factors are difficult to predict, contain uncertainties
that may materially affect actual results and may be beyond our
control. New factors emerge from time to time, and it is not
possible for management to predict all such factors or to assess
the impact of each such factor on UNIFI. Any forward-looking
statement speaks only as of the date on which such statement is
made, and we do not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which such statement is made, except as may be required
by federal securities laws. The above and other risks and
uncertainties are described in UNIFI’s most recent Annual Report on
Form 10-K, and additional risks or uncertainties may be described
from time to time in other reports filed by UNIFI with the
Securities and Exchange Commission pursuant to the Securities
Exchange Act of 1934, as amended.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240131804814/en/
Davis Snyder or Darren Yeun Alpha IR Group 312-445-2870
UFI@alpha-ir.com
Unifi (NYSE:UFI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Unifi (NYSE:UFI)
Historical Stock Chart
From Jul 2023 to Jul 2024