TORONTO, Oct. 13, 2021 (GLOBE NEWSWIRE) -- 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 In addition, our minority partner has withdrawn his request for payout of his minority position and agreed to not exercise this right during fiscal 2022 other than by mutual agreement.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 Pandemic
Although 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 Clients
Unisync’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.
Unisync 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 firstname.lastname@example.org
Forward Looking Statements
This 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.
Source: Unisync Corp.
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