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Business Segment Information
 12 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
Business Segment Information

23. Business Segment Information

UNIFI defines operating segments as components of the organization for which discrete financial information is available and operating results are evaluated on a regular basis by UNIFI’s chief executive officer, who is the chief operating decision maker (the “CODM”), in order to assess performance and allocate resources. Characteristics of UNIFI which were relied upon in making the determination of reportable segments include the nature of the products sold, the internal organizational structure, the trade policies in the geographic regions in which UNIFI operates, and the information that is regularly reviewed by the CODM for the purpose of assessing performance and allocating resources.

UNIFI's three reportable segments are organized as follows:

•
The operations within the Americas Segment exhibit similar long-term economic characteristics and primarily sell into an economic trading zone covered by the United States-Mexico-Canada Agreement and the Dominican Republic-Central America Free Trade Agreement to similar customers utilizing similar methods of distribution. These operations derive revenues primarily from manufacturing synthetic and recycled textile products with sales primarily to yarn manufacturers, knitters, and weavers that produce yarn and/or fabric for the apparel, hosiery, automotive, home furnishings, industrial, medical, and other end-use markets principally in North and Central America. The Americas Segment consists of sales and manufacturing operations in the U.S., El Salvador, and Colombia.
•
The Brazil Segment primarily manufactures and sells polyester-based products to knitters and weavers that produce fabric for the apparel, automotive, home furnishings, industrial, and other end-use markets principally in Brazil. The Brazil Segment includes a manufacturing location and sales offices in Brazil.
•
The operations within the Asia Segment exhibit similar long-term economic characteristics and sell to similar customers utilizing similar methods of distribution primarily in Asia and Europe. The Asia Segment primarily sources synthetic and recycled textile products from third-party suppliers and sells to yarn manufacturers, knitters, and weavers that produce fabric for the apparel, automotive, home furnishings, industrial, and other end-use markets principally in Asia and Europe. The Asia Segment includes sales offices in China, Turkey, and Hong Kong.

UNIFI evaluates the operating performance of its segments based upon Segment Profit, which represents segment gross profit (loss) plus segment depreciation expense. This measurement of segment profit or loss best aligns segment reporting with the current assessments and evaluations performed by, and information provided to, the CODM.

The accounting policies for the segments are consistent with UNIFI’s accounting policies. Intersegment sales are omitted from segment disclosures, as they are (i) insignificant to UNIFI’s segments and eliminated from consolidated reporting and (ii) excluded from segment evaluations performed by the CODM. However, intersegment technologies expense charged from the Americas Segment to the Asia Segment is not eliminated from segment results. The technologies expense (i) reflects the sharing of certain manufacturing know-how, processes, and product technical information and design and (ii) is included in the segment evaluations performed by the CODM.

Selected financial information is presented below:

 

 

Fiscal 2024

 

 

 

Americas

 

 

Brazil

 

 

Asia

 

 

Total

 

Net sales

 

$

344,256

 

 

$

117,783

 

 

$

120,170

 

 

$

582,209

 

Cost of sales

 

 

361,886

 

 

 

103,028

 

 

 

100,679

 

 

 

565,593

 

Gross (loss) profit

 

 

(17,630

)

 

 

14,755

 

 

 

19,491

 

 

 

16,616

 

Segment depreciation expense

 

 

22,154

 

 

 

3,257

 

 

 

10

 

 

 

25,421

 

Segment Profit

 

$

4,524

 

 

$

18,012

 

 

$

19,501

 

 

$

42,037

 

 

 

Fiscal 2023

 

 

 

Americas

 

 

Brazil

 

 

Asia

 

 

Total

 

Net sales

 

$

389,662

 

 

$

119,062

 

 

$

114,803

 

 

$

623,527

 

Cost of sales

 

 

404,321

 

 

 

106,900

 

 

 

98,065

 

 

 

609,286

 

Gross (loss) profit

 

 

(14,659

)

 

 

12,162

 

 

 

16,738

 

 

 

14,241

 

Segment depreciation expense

 

 

22,044

 

 

 

2,035

 

 

 

—

 

 

 

24,079

 

Segment Profit

 

$

7,385

 

 

$

14,197

 

 

$

16,738

 

 

$

38,320

 

 

 

Fiscal 2022

 

 

 

Americas

 

 

Brazil

 

 

Asia

 

 

Total

 

Net sales

 

$

483,085

 

 

$

126,066

 

 

$

206,607

 

 

$

815,758

 

Cost of sales

 

 

458,617

 

 

 

98,925

 

 

 

177,731

 

 

 

735,273

 

Gross profit

 

 

24,468

 

 

 

27,141

 

 

 

28,876

 

 

 

80,485

 

Segment depreciation expense

 

 

21,153

 

 

 

1,500

 

 

 

—

 

 

 

22,653

 

Segment Profit

 

$

45,621

 

 

$

28,641

 

 

$

28,876

 

 

$

103,138

 

The reconciliations of segment gross profit to consolidated (loss) income before income taxes are as follows:

 

 

Fiscal 2024

 

 

Fiscal 2023

 

 

Fiscal 2022

 

Americas

 

$

(17,630

)

 

$

(14,659

)

 

$

24,468

 

Brazil

 

 

14,755

 

 

 

12,162

 

 

 

27,141

 

Asia

 

 

19,491

 

 

 

16,738

 

 

 

28,876

 

Segment gross profit

 

 

16,616

 

 

 

14,241

 

 

 

80,485

 

SG&A

 

 

46,632

 

 

 

47,345

 

 

 

52,489

 

Provision (benefit) for bad debts

 

 

1,571

 

 

 

(89

)

 

 

(445

)

Restructuring costs

 

 

5,101

 

 

 

—

 

 

 

—

 

Other operating expense (income), net

 

 

733

 

 

 

7,856

 

 

 

(158

)

Operating (loss) income

 

 

(37,421

)

 

 

(40,871

)

 

 

28,599

 

Interest income

 

 

(2,136

)

 

 

(2,109

)

 

 

(1,524

)

Interest expense

 

 

9,862

 

 

 

7,577

 

 

 

3,085

 

Equity in loss (earnings) of unconsolidated affiliates

 

 

390

 

 

 

(896

)

 

 

(605

)

Recovery of non-income taxes, net

 

 

—

 

 

 

—

 

 

 

815

 

(Loss) income before income taxes

 

$

(45,537

)

 

$

(45,443

)

 

$

26,828

 

The reconciliations of segment depreciation and amortization expense to consolidated depreciation and amortization expense are as follows:

 

 

Fiscal 2024

 

 

Fiscal 2023

 

 

Fiscal 2022

 

Americas

 

$

22,154

 

 

$

22,044

 

 

$

21,153

 

Brazil

 

 

3,257

 

 

 

2,035

 

 

 

1,500

 

Asia

 

 

10

 

 

 

—

 

 

 

—

 

Segment depreciation expense

 

 

25,421

 

 

 

24,079

 

 

 

22,653

 

Other depreciation and amortization expense

 

 

2,248

 

 

 

3,107

 

 

 

3,554

 

Depreciation and amortization expense

 

$

27,669

 

 

$

27,186

 

 

$

26,207

 

 

The reconciliations of segment capital expenditures to consolidated capital expenditures are as follows:

 

 

Fiscal 2024

 

 

Fiscal 2023

 

 

Fiscal 2022

 

Americas

 

$

8,843

 

 

$

25,943

 

 

$

29,841

 

Brazil

 

 

1,815

 

 

 

10,244

 

 

 

9,253

 

Asia

 

 

247

 

 

 

41

 

 

 

236

 

Segment capital expenditures

 

 

10,905

 

 

 

36,228

 

 

 

39,330

 

Other capital expenditures

 

 

284

 

 

 

206

 

 

 

301

 

Capital expenditures

 

$

11,189

 

 

$

36,434

 

 

$

39,631

 

 

The reconciliations of segment total assets to consolidated total assets are as follows:

 

 

June 30, 2024

 

 

July 2, 2023

 

Americas

 

$

300,977

 

 

$

334,303

 

Brazil

 

 

96,728

 

 

 

115,676

 

Asia

 

 

44,956

 

 

 

60,752

 

Segment total assets

 

 

442,661

 

 

 

510,731

 

Other current assets

 

 

5,480

 

 

 

5,179

 

Other PP&E

 

 

12,501

 

 

 

15,034

 

Other operating lease assets

 

 

1,522

 

 

 

504

 

Other non-current assets

 

 

5,477

 

 

 

4,374

 

Investments in unconsolidated affiliates

 

 

1,603

 

 

 

2,997

 

Total assets

 

$

469,244

 

 

$

538,819

 

Geographic Data

 

Net Sales

 

Fiscal 2024

 

 

Fiscal 2023

 

 

Fiscal 2022

 

U.S.

 

$

314,027

 

 

$

355,197

 

 

$

430,381

 

Brazil

 

 

117,783

 

 

 

119,061

 

 

 

126,066

 

China

 

 

112,650

 

 

 

100,183

 

 

 

185,558

 

Remaining Foreign Countries

 

 

37,749

 

 

 

49,086

 

 

 

73,753

 

Total

 

$

582,209

 

 

$

623,527

 

 

$

815,758

 

 

 

 

 

 

 

 

 

 

 

Export sales from UNIFI’s U.S. operations to external customers

 

$

65,666

 

 

$

52,051

 

 

$

74,589

 

 

The net sales amounts are based on the operating locations from where the items were produced or distributed.

 

Long-Lived Assets

 

June 30, 2024

 

 

July 2, 2023

 

U.S.

 

$

167,134

 

 

$

184,249

 

Brazil

 

 

30,569

 

 

 

36,945

 

China

 

 

1,375

 

 

 

968

 

Remaining Foreign Countries

 

 

15,841

 

 

 

18,658

 

Total

 

$

214,919

 

 

$

240,820

 

Long-lived assets are comprised of PP&E, net; operating lease assets; intangible assets, net; investments in unconsolidated affiliates; and other non-current assets.