Unifi cuts forecast as yarn inventories back up
By Staff -- Home Textiles Today, 12/8/2006 10:20:00 AM
Greensboro, N.C. – Yarn producer Unifi, Inc. has revised its expectations downward for the financial results for the quarter ended December 2006, from a previous forecast of $10 million to $12 million EBITDA to a new projection of “less than 50% of this forecast.”
"The drop in volume…has continued through October and November, despite the reduction in sales price to our customers," said Bill Lowe, coo and cfo of Unifi, which makes yarn products used in a range of home furnishings fabrics.
Lowe said, “Although raw material prices have declined since a high in September, we are still working off the higher priced inventory as this business unit is on the first-in-first-out method for inventory, which has had an additional negative effect on earnings, and the low volume has the additional effect of lengthening this process.”
“Our customers tell us that we have not lost market share in this period, but that the demand from retailers has slowed some business,” Lowe emphasized.
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