Unifi, Inc. New · NYSE:UFI
Unifi, Inc. New — Unifi — 2006 Wachovia Securities Consumer Growth Conference
27 slides from Unifi, Inc. New's conference presentation, Feb 21, 2006
Slide 1: Unifi, Inc. Business Update – Wachovia Consumer Growth Conference
UNIFI, INC. 2006 Wachovia Securities Consumer Growth Conference Business Update February 2006 Unifi Confidential
Slide 2: Cautionary Statement
Dal Cautionary Statement Certain statements included herein contain forward-looking statements within the meaning of federal security laws about Unifi, Inc.’s (the “Company”) financial condition and results of operations that are based on management’s current expectations, estimates and projections
Slide 3: Agenda
Dal Agenda 1. Introduction to Unifi 2. Industry Dynamics and the Unifi Market 3. Business Update and Strategy Unifi Confidential
Slide 4: Raw Fiber to Brands and Retailers Value Chain
RAW FIBER PRODUCERS * One of the world’s largest textured yarn producers YARN PRODUCER * Focus on polyester, nylon, and spandex FABRIC PRODUCERS * Yams for wide array of fabrics and end-uses PRODUCT * Sales in over 25 countries MANUFACTURERS BRANDS & RETAILERS Unifi Confidential
Slide 5: What We Do
What We Do Texturing Machines Returng Units Textured Yams Value-added Processes Products Texturing machines process The friction cis units the Ate the POY is processed, 1, Pakage Dyeing Uni flament yarns are POY muti-lament yams by heart ofthe texturing the resulting tetured yarn 2. Covering found w
Slide 6: Industry Dynamics and the Unifi Market
Industry Dynamics and the Unifi Market Unifi Confidential
Slide 7: The Macro USA Textile Industry Review
The Macro USA Textile Industry Review 2005 Compared Estimates to 04’ TEXTILE SHIPMENTS (Annualized YTD) $80 Billion Down 2% TEXTILE INDUSTRY CONTIRUBTION TO THE US GDP. $55 TO $65 Ranking 3° among basic manufacturing industries in terms of Billion contributions to the U.S. economy. (Estimates) CAPIT
Slide 8: Not All Segments Impacted Equally By Imports
Not All Segments Impacted Equally By Imports 100% 90% 80% 70% 60% 50% 40% | 30% 20% 10% 0% APPAREL (INC TOP OF BED =UPHOLSTERED US LIGHT. MATTRESSES / REGIONAL) FURNITURE VEHICLE SALES BEDDING = DOMESTIC @ IMPORTS Note: Some segments are based on volume and others on US Dollars. They represent impor
Slide 9: Unifi Polyester DTY Demand Sustainability And Market Attractiveness
Unifi Polyester DTY Demand Sustainability And Market Attractiveness OTHER 8% AUTOMOTIVE 13% HOSIERY 5% UPHOLSTERY 21% APPAREL 33% TOP OF BED 9% INDUSTRIAL 11% Unifi Confidential
Slide 10: Automotive Segment — Polyester
Automotive Segment — Polyester gz Volume Contribution to Unifi Polyester DTY Business: 13 % Outlook: This segment can be sustained due to the need to be closer to the market and low imports threat for the foreseeable future. Sustainability also requires supplying to the Japanese auto makers who are
Slide 11: Upholstery Segment — Polyester
Upholstery Segment-— Polyester ¥olume Contribution to Unifi Polyester DTY Business: 21% Outlook: This segment can be sustained because of low imports penetration (compared to apparel) and demands special and faster service needs. Imports will continue to grow and could become a major threat in the c
Slide 12: Unifi Nylon DTY Demand Sustainability And Market Attractiveness
Unifi Nylon DTY Demand Sustainability And Market g Attractiveness OTHER 6% APPAREL 32% LADIES HOSIERY 36% INDUSTRIAL 4% SOCKS 22% Unifi Confidential 13
Slide 13: Ladies Hosiery Segment - Nylon
Ladies Hosiery Segment - Nylon gz Volume Contribution to Unifi Nylon DTY Business: 36% Outlook: This segment can be partially sustained by continuing to supply the largest domestic ladies hosiery producer, who is expected to further gain domestic market share . This segment is expected to decline at
Slide 14: Socks Segment - Nylon
Socks Segment - Nylon gz Volume Contribution to Unifi Nylon DTY Business: 22 % Outlook: This segment is subject to continuing threat from imports at the retail level especially from global sock producers who are sourcing finished goods from abroad. This segment can be partially sustained through bra
Slide 15: NAFTA Production Share Estimates
NAFTA Production Share Estimates PRODUCTION UNIFI US MEX / CAN SHARE PRODUCERS PRODUCERS POLYESTER POY 46% 29% 25% POLYESTER TEXTURED 36% 38% 26% NYLON TEXTURED 36% 35% 29% Unifi Confidential
Slide 16: Business Overview and Our Strategy
Business Overview and Our Strategy Unifi Confidential
Slide 17: Balance Sheet Highlights
Balance Sheet Highlights s (in thousands $, except percentages and days in receivables/payables) Dec. 25 Sept. 25 June 26, Mar. 27 2005 2005 2005 2005 Cash $ 85,019 _$ 90,744 _$ 105,621 $ 55,449 Inventory $ 109572 $ 114179 $ 110,827 $ 142848 Short-Term Debt $ 7,246 $ 9719 $ 33,646 $ 8101 Long-Term D
Slide 18: EBITDA
Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) [1] (in millions $) March June Sep. Dec. 2004 005 1 - Defined as net income before interest, taxes, depreciation and amortization, excluding equity affiliate income or loss, restructuring expenses and other special items 2.- Ref
Slide 19: EBITDA Reconciliation to Pre-Tax Income
EBITDA Reconciliation to Pre-Tax Income (in thousands $) Mar-04 Mar-05 Im-04 Im-05 Sep-04 Sep-05 Dec-04 Dec-05 Pre-tax loss [1] $ 6531) $ (2,935) $ (A410) $ (21,882) $ 2,265) $ 6340) $ 0,772) $ 4,978) Interest expense 4,740 5,256 4431 5,361 4,665 4777 5,293 4,659 Depreciation expense 14,342 12,527 1
Slide 20: Joint Ventures
Joint Ventures (in millions $) Book Value @ Dividends Received 12/25/05 FYE 2005 YTD 2006 Parkdale 141.0 9.6 11 America Yihui-Unifi 30.6 (China) Unifi SANS 14.3 Unifi Nilit 61 1.5 1.0 Unifi Confidential 21
Slide 21: Key Improvements
Dal Key Improvements Reduced working capital $66 million Improved days in receivable from 63 days to 43.5 days Cash balance $85 million at December 2005 Bank revolver availability $67 million....zero drawn Fully integrated the Kinston acquisition paid off seller financing of $24 million within 9 mon
Slide 22: Strategy – Internal
' Strategy Internal > Exit non-profitable products > Relocate production to the most efficient operation > Downstream marketing/premium value product growth > Continue to improve operating cash flow > Grow through joint venture in China to capture market growth where polyester is growing at a rate c
Slide 23: Performance yarn consumer facts
There are 1 s hhe surface area of to keep us flexible * x For stretch e average person ihe temperature has 2.6 million sweat inside your an glands in their skin. reach 102°F Keep dry That's Good thing there’ no sweat Cite for... [optimum Contos, odor causing bacteria cals can double every 20 minutes
Slide 24: A single performance yarn that combines everything you need
A single performance yarn that combines everything you need. In any combination you need. Moisture management. Stretch. UV protection. Antimicrobial control. Whatever you want. Created just for you. Only by Unifi. al-in-one OEY the properties you want www.unifi.com product benefits d to fit your
Slide 25: Strategy – External
; Strategy External On October 20, 2005 the Company announced that it would begin to study a broad array of alternatives that would include growing the business by expanding within the textile industry, including into low-cost locations around the world, expanding in non-textile related businesses,
Slide 26: Conclusion
, Conclusion We remain focused on: > Returning to profitability > Growing our joint venture business in China > Building shareholder value through internal operational improvements and external strategic action(s). > Increasing liquidity and monetizing non-productive assets to address the bond matur
Slide 27: Unifi, Inc.
UNIFI, INC. Unifi Confidential
Unifi — 2006 Wachovia Securities Consumer Growth Conference on 6ix