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Dec 27, 2020
Unifi Q2 2021 Earnings Report
Unifi's Q2 2021 earnings were significantly improved, driven by stronger than expected performance and focused execution, resulting in one of the best quarterly margin and profitability performances over the last decade.
Key Takeaways
Unifi, Inc. reported net sales of $162.8 million, a decrease of 4.0% year-over-year, but an increase of 15.0% sequentially. Net income was $7.5 million, or $0.40 of diluted earnings per share, up from net income of $0.4 million and EPS of $0.02 year-over-year. Adjusted EBITDA was $19.2 million, the highest quarterly achievement since June 2016.
Net sales were $162.8 million, a decrease of 4.0% year-over-year, but an increase of 15.0% sequentially from the first quarter of fiscal 2021.
Revenues from REPREVE® Fiber products represented 37% of consolidated net sales, a new quarterly record.
Gross profit was $25.9 million, a 66% increase year-over-year, while gross margin was 15.9% of net sales, an increase of 670 basis points year-over-year, influenced by the strong performance from the Brazil Segment.
Net income was $7.5 million, or $0.40 of diluted earnings per share, up from net income of $0.4 million and EPS of $0.02 year-over-year.
Unifi
Unifi
Unifi Revenue by Geographic Location
Revenue by Geographic Location
Brazil Revenue
CapyFin.comAsia Revenue
CapyFin.com Forward Guidance
The Company’s outlook for the third quarter of fiscal 2021 is limited to the following expectations:
Positive Outlook
- Net sales trends continue to improve sequentially, including sales of REPREVE® Fiber, with net sales returning to the pre-pandemic level of the March 2020 quarter
- Net sales trends continue to improve sequentially, including sales of REPREVE® Fiber, with net sales returning to the pre-pandemic level of the March 2020 quarter
- Adjusted EBITDA improves by a low double-digit percentage from the pre-pandemic level of the March 2020 quarter by maintaining the underlying business momentum that has occurred in fiscal 2021, with consideration for the following factors that are expected to differ from the December 2020 quarter:
- Adjusted EBITDA improves by a low double-digit percentage from the pre-pandemic level of the March 2020 quarter by maintaining the underlying business momentum that has occurred in fiscal 2021, with consideration for the following factors that are expected to differ from the December 2020 quarter:
- Continued strong performance by the Brazil Segment, albeit tempered from the record setting December 2020 quarter
Challenges Ahead
- Continued strong performance by the Brazil Segment, albeit tempered from the record setting December 2020 quarter
- Unfavorable seasonal domestic shutdown impacts to gross profit for the Polyester and Nylon Segments
- Unfavorable seasonal domestic shutdown impacts to gross profit for the Polyester and Nylon Segments
- Unfavorable impact of the Chinese New Year holiday for the Asia Segment
- Raw material cost pressures due to recent increases in petroleum prices.
Revenue & Expenses
Visualization of income flow from segment revenue to net income