UNIFI INC 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk UNIFI is exposed to market risks associated with changes in interest rates, fluctuations in foreign currency exchange rates, and raw material and commodity costs, which may adversely affect its financial position, results of operations, or cash flows. UNIFI does not enter into derivative financial instruments for trading purposes, nor is it a party to any leveraged financial instruments. Interest Rate Risk UNIFI is exposed to interest rate risk through its borrowing activities. As of March 31, 2024, UNIFI had borrowings under its ABL Facility that totaled $118,500. UNIFI’s sensitivity analysis indicates that a 50-basis point interest rate increase as of March 31, 2024 would result in an increase in annual interest expense of approximately $700. Foreign Currency Exchange Rate Risk A complete discussion of foreign currency exchange rate risk is included in the 2023 Form 10-K and is supplemented by the following disclosures. As of March 31, 2024, UNIFI had no outstanding foreign currency forward contracts. As of March 31, 2024, foreign currency exchange rate risk positions included the following: Approximate Amount or Percentage Percentage of total consolidated assets held by UNIFI's subsidiaries outside the U.S. whose functional currency is not the USD 30.3 % Cash and cash equivalents held outside the U.S.: Denominated in USD $ 16,316 Denominated in RMB 1,219 Denominated in BRL 8,532 Denominated in other foreign currencies 195 Total cash and cash equivalents held outside the U.S. $ 26,262 Percentage of total cash and cash equivalents held outside the U.S. 94.9 % Cash and cash equivalents held inside the U.S. in USD by foreign subsidiaries $ 1,379 26 Raw Material and Commodity Cost Risks A complete discussion of raw material and commodity cost risks is included in the 2023 Form 10-K. Other Risks UNIFI is also exposed to geopolitical risk, including changing laws and regulations governing international trade, such as quotas, tariffs, and tax laws. The degree of impact and the frequency of these events cannot be predicted.