Unisync Enters Fiscal 2022 With a Strong Balance Sheet and Improving Business Conditions
13 Oktober 2021 - 2:30PM
Unisync Corp.
(“Unisync”) (TSX:“UNI”)
(OTCQX:“USYNF”) is pleased to announce that it has
completed the $10 million capital restructuring plan announced on
July 27th, leaving it with a strong working capital position and
long-term debt being limited to mortgage debt on its operating
facilities in Winnipeg and Montreal plus capitalized lease
liabilities. We continue to believe that owning our operating
facilities where we can, reduces the risk of major increases in
future facility costs due to inflationary pressure on base lease
rates and allows Unisync to benefit from improvements in market
values. It is noteworthy that our real estate holdings have a
current appraised value of $12.9 million, which is $6.2 million
above their book value of $6.7 million. In addition, our minority
partner has withdrawn his request for payout of his minority
position and agreed to not exercise this right during fiscal 2022
other than by mutual agreement. After adjusting for the market
value of real estate and treating the minority partner’s interest
as equity, the Company has total debt (including capitalized lease
liabilities) to equity and working capital ratios both
approximating 1.4:1.
Making Headway In The Midst Of A
PandemicAlthough the onset of the COVID-19 pandemic has
had a material effect on the employee count of many of our managed
services clients, particularly those in the transportation and
hospitality industries, Unisync has managed to offset some of the
significant resulting drop in its revenues by pivoting into new
sources of business such as PPE. More importantly, Unisync
continued to add to its base of uniform service contracts
throughout the pandemic with the addition of well-known clients
such as BCE, Canadian Coast Guard, BC Ferries, Canada Post (PPE
contract), Allegiant Air, City of Saskatoon, Surrey Police, LCBO
and others. Bid proposals submitted on a number of major public
RFPs with entities such as CBSA, Montreal Transit and DND are still
outstanding and awaiting to be awarded. The massive $1 billion/20yr
managed services contract bid with DND, referred to as OCFC2, was
submitted in August, although a decision on this 500+ page bid
response is not expected until well into 2022. Management also has
visibility on several other significant managed uniform services
opportunities coming to the market over the next year.
Product offerings were also recently expanded to
provide a wider range of professional grade apparel and footwear
options through strategic alliances with Mark’s and Helly Hansen
and the launch of Tactical Gear Experts, a B2C eCommerce portal
which can be accessed at https://tacticalgearexperts.com/.
Improving Market Conditions For Our Key
ClientsUnisync’s major foothold in the transportation and
hospitality industries has seen some accounts having to suspend
operation, resulting in their uniform needs dropping off
completely. Other clients in this industry sector had to
significantly reduce staff levels with normal revenues from some of
our larger airline accounts dropping by as much as 80%. We have
seen a significant reversal in the last month in these sectors with
uniform orders picking up substantially and, in some cases,
approaching pre-pandemic levels. Although we expect some delays in
deliveries due to the long lead times associated with replacement
production, many of our transportation accounts are anticipating a
rapid return to near pre-pandemic levels by early next year. An
increase is expected in the average size of individual employee
orders due to a greater percentage of new employees coming on
stream that require a full uniform package. In addition, we are in
the process of launching a new uniform design for one of our larger
transportation accounts that is expected to provide a major
increase in the revenue per employee for this client when the
launch takes place in the first half of 2022.
Peerless Garments LP, our Winnipeg based
manufacturing division, has added over $8 million in new government
contract wins during Q4 2021, which included $1.3 million in face
masks, $1.9 million in naval rain jackets and pants, and $4.1
million in enhanced combat uniforms. Peerless ended fiscal 2021
with $18 million in firm contracts and options outstanding.
These developments bode well for a more positive
operating environment throughout fiscal 2022 and should pave the
way for continued improvement in operating performance and
profitability throughout fiscal 2022.
About UnisyncUnisync is a
broad-based vertically integrated North American enterprise with
exceptional capabilities in garment design, domestic manufacturing,
and offshore outsourcing, including state-of-the-art web based B2B
ordering, distribution, and program management systems. Unisync
operates through two business units: Unisync Group Limited (“UGL”)
and 90% owned Peerless Garments LP which has been producing
operational uniforms and accessories to Canada’s Armed Forces and
others for over 50 years.
UGL is a leading provider of full-service,
managed apparel programs for major corporations and
government-related entities with an established broad-based
geographical footprint across Canada and into the US
marketplace.
On Behalf of the Board of Directors
Douglas F. Good, Executive Chairman
Investor
relations contact:Telephone:
778-370-1725 or Email investorrelations@unisyncgroup.com
Forward Looking StatementsThis
news release may contain forward-looking statements that involve
known and unknown risk and uncertainties that may cause the
Company’s actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied in these forward-looking
statements. Any forward-looking statements contained herein are
made as of the date of this news release and are expressly
qualified in their entirety by this cautionary statement. Except as
required by law, the Company undertakes no obligation to publicly
update or revise any such forward-looking statements to reflect any
change in its expectations or in events, conditions or
circumstances on which any such forward-looking statements may be
based, or that may affect the likelihood that actual results will
differ from those set forth in the forward-looking statements.
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