Unifi, Inc. (NYSE: UFI), one of the world's leading synthetic recycled yarn producers, today released operating results for the fourth quarter and fiscal year endedJune 26, 2016.

Fourth Quarter 2016

• Operating income increased by $2.0 million compared to the prior year fourth quarter. Net income declined by $5.4 million compared to the prior year fourth quarter primarily due to lower earnings from Parkdale America, LLC ("PAL") and a 33% effective tax rate compared to an 18% effective tax rate in the prior year fourth quarter
• Gross margin climbed to 16.8%, compared to 14.5% for the prior year fourth quarter

Fiscal 2016

• Operating income increased by $3.7 million compared to fiscal 2015. Net income declined by $7.7 millioncompared to fiscal 2015 primarily due to lower earnings from PAL and a 31% effective tax rate compared to a 25% effective tax rate in fiscal 2015
• Gross margin climbed to 14.5%, compared to 13.2% for fiscal 2015
• Premium value-added ("PVA") products surpassed 35% of net sales

"I am pleased to report strong fourth quarter and fiscal 2016 results. Our international operations, coupled with strong sales of PVA products, helped drive solid results," said Tom Caudle, President of Unifi. "We've spent the last several years transforming our business and shifting our sales mix to higher-margin PVA products. We remain committed to producing the highest quality, innovative and sustainable products for our customers around the world. This has been the foundation of our success over the past several years, and we believe it will continue to be as we grow. We're excited about the course of our business and our global opportunities."

Fourth Quarter and Fiscal 2016 Operational Review

Net sales were $163.9 million for the fourth quarter of fiscal 2016, compared to net sales of $175.0 million for the fourth quarter of fiscal 2015. Net sales were unfavorably impacted primarily by devaluation of the Brazilian Real and lower selling prices due to lower raw material prices. Net sales were $643.6 million for fiscal 2016, compared to $687.1 million for fiscal 2015 primarily due to the same factors noted in the quarterly comparison.

Market share gains for the International Segment and a disciplined focus on the Company's PVA portfolio returned strong operating results. Operating income grew in the fourth quarter of fiscal 2016 by $2.0 million and operating margin improved by 168 basis points, both compared to the fourth quarter of fiscal 2015. Operating income for fiscal 2016 grew by $3.7 million and operating margin improved by 96 basis points, both compared to fiscal 2015.

Net income for the fourth quarter of fiscal 2016 was $10.2 million, compared to $15.6 million for the fourth quarter of fiscal 2015, primarily due to $5.1 million of lower pre-tax earnings from PAL and a more favorable effective tax rate in the prior year period. Net income for fiscal 2016 was $34.4 million, compared to $42.2 million for fiscal 2015, with fiscal 2016 adversely impacted by $11.3 million of lower pre-tax earnings from PAL and a more favorable effective tax rate in fiscal 2015.

Adjusted EBITDA was $21.1 million for the fourth quarter of fiscal 2016, compared to $19.2 million for the fourth quarter of fiscal 2015. Adjusted EBITDA was $68.6 million for fiscal 2016 compared to $64.3 million for fiscal 2015. The Company is adopting a new approach to calculating Adjusted EBITDA on a going-forward basis that reduces the number of adjustments and is intended to promote period-to-period consistency. Under the Company's new approach, Adjusted EBITDA was $20.6 million for the fourth quarter of fiscal 2016, compared to $18.2 million for the fourth quarter of fiscal 2015, and $65.4 million for fiscal 2016, compared to $59.6 millionfor fiscal 2015. Adjusted EBITDA is a non-GAAP financial measure. The schedules included in this press release reconcile Adjusted EBITDA to net income attributable to Unifi, Inc.

Net debt (total debt less cash and cash equivalents) was $106.4 million at the end of fiscal 2016, consistent with the Company's expectations and capital allocation priorities, which include enhancing manufacturing operations for continued growth, flexibility and capacity; and expanding the business internationally.

Fiscal 2017 Outlook

For fiscal 2017, the Company anticipates:

• Revenue growth in the low single digit percentage range, assuming raw material prices are unchanged
• Operating income and Adjusted EBITDA growth in the low single digit percentage range
• Effective tax rate in the low 30% range
• Continuing the current capital investment strategy, with estimated capital expenditures of approximately$40 million

"We expect growth in our top line in fiscal 2017, based on increased contributions from our international operations, PVA portfolio, and our new bottle processing facility, all of which should help offset a soft domestic environment," said Sean Goodman, CFO of Unifi. "We expect some gross margin pressure in fiscal 2017 associated with initial start-up costs for our bottle processing operation and Recycling Center expansion. We anticipate that the financial benefits of these investments will be realized in fiscal 2018 and beyond. We will continue to invest diligently in our business to position our assets for enhanced returns, to expand internationally, and to continue on a path for long-term growth."

About Unifi

Unifi, Inc. (NYSE: UFI) is a multi-national manufacturing company that produces and sells recycled and other processed yarns designed to meet customer specifications, and premium value-added ("PVA") yarns with enhanced performance characteristics. Unifi maintains one of the textile industry's most comprehensive polyester and nylon product offerings. Unifi enhances demand for its products, and helps others in creating a more effective textile industry supply chain, through the development and introduction of branded yarns that provide unique performance, comfort and aesthetic advantages. In addition to its flagship REPREVE® products – a family of eco-friendly yarns made from recycled materials – key Unifi brands include: SORBTEK®, REFLEXX®, aio® - all-in-one performance yarns, SATURA®, AUGUSTA® A.M.Y.®, MYNX® UV, and MICROVISTA®. Unifi's yarns are readily found in the products of major brands in the apparel, hosiery, automotive, home furnishings, industrial and other end-use markets. For more information about Unifi, visitwww.unifi.com; to learn more about REPREVE®, visit www.repreve.com.