Unifi plans to streamline operations by selling North Carolina plant

GREENSBORO, N.C. - Unifi, Inc. (NYSE: NYSE:UFI), a leader in the production of recycled and synthetic yarns with annual revenue of $590.74 million, announced today it will transition yarn production from its Madison, North Carolina facility and put the property on the market in 2025. This move is part of a strategic decision to enhance Unifi’s operating efficiency and strengthen its balance sheet, which currently carries $140 million in total debt. According to InvestingPro data, the company has been experiencing rapid cash burn, making this restructuring particularly significant.

The company’s consolidation efforts aim to maintain customer service and sales volume while increasing the utilization rates of its remaining facilities across North and Central America. This is expected to absorb fixed costs more effectively and support long-term profitability, which is crucial given the company’s current gross profit margin of just 4.51%. InvestingPro analysis reveals 8 additional key insights about Unifi’s financial health and market position.

Unifi’s CEO, Eddie Ingle, expressed gratitude to the employees and community associated with the Madison facility and emphasized the company’s commitment to a smooth transition, offering opportunities at other North Carolina facilities to existing employees.

Ingle also highlighted that the closure is aligned with Unifi’s strategy to serve its growing customer base in North and Central America more effectively. The transition includes relocating certain equipment to other manufacturing locations, which will not impact the market demand fulfillment or the company’s focus on innovation and financial improvement.

The financial details of the strategic transition will be further discussed during Unifi’s second quarter fiscal 2025 earnings conference call scheduled for February 6, 2025.

Unifi, known for its REPREVE® brand of recycled fibers and resins, continues to champion sustainability in its operations. The sale of the Madison property and the subsequent debt reduction are part of the company’s broader vision for a more sustainable future.

This article is based on a press release statement from Unifi, Inc.

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