ONEITA POSTS $5.9M LOSS FOR QUARTER
CHARLESTON, S.C — Oneita Industries Inc. widened its first-quarter loss to $5.9 million, is in violation of its financial covenants and expects to report an operating loss in the second quarter.
In the year-ago quarter, it lost $3.4 million, after a $2.1 million income tax gain. Oneita’s operating loss was narrowed slightly to $4 million from $4.1 million.
Sales for the three months ended Dec. 28 slipped 3.7 percent to $33.9 million from $35.2 million.
The company, which makes activewear and infants’ apparel, said that demand for its products continues weak and there is downward pressure on prices.
The company has been advised that the lending banks under its revolving credit agreement have assigned their stake to third parties, including Albert Fried Jr., a former director of the company.
Oneita intends to initiate discussions with these third parties and its remaining institutional lender to secure waivers covering the periods of noncompliance and to restructure its existing debts.
Loan balances outstanding under its bank agreement totaled $63.2 million at the end of the period.
Commenting on Oneita’s performance, Mike Billingsley, president and chief executive, said in a statement, “The demand for Oneita’s products continues to be weak due to the seasonality of the business and to excess production capacity within the industry.”
“In the meantime,” he said, “every aspect of our business will continue to be reviewed and addressed in the pursuit of cost savings and greater value for our customers. Our distribution channels are being expanded within the confines of our manufacturing capabilities.”