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  Title	Culp Announces Results for Third Quarter Fiscal 2025, Highlighted by Contin
  ID	7480109
  External ID	7603241722
  Author	Wed Mar
  Published Date	March 5, 2025, 3:19 p.m.
  Summary	Culp, Inc. (NYSE: CULP) (together with its consolidated subsidiaries, “CULP” or the "company") today reported financial and operating results for the third quarter ended January 26, 2025. Fiscal 2025
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  URL	http://sogotradedev.websol.barchart.com/?module=topnews&storyid=31262123
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  Content ID	4785355
  Key	df1ce987-6732-4a04-adae-e161635870cb
  Content	Culp, Inc. (NYSE: CULP) (together with its consolidated subsidiaries, “CULP” or the "company") today reported financial and operating results for the third quarter ended January 26, 2025. Fiscal 2025 Third Quarter Financial Highlights Consolidated net sales of $52.3 million - Down 6.1 percent compared sequentially to last quarter, with mattress fabrics sales down 4.8 percent and upholstery fabrics sales down 7.8 percent Continued improvement in mattress fabrics operating performance, with a 58.3 percent sequential reduction in operating loss on lower sales (following a 70.7 percent sequential reduction last quarter) Continued profitability in upholstery fabrics segment in extremely challenging industry environment GAAP consolidated loss from operations of $(3.9) million (includes $2.3 million in restructuring expense and related charges) - Non-GAAP loss from operations of $(1.6) million (see reconciliation table on page 15) - Sequential reduction in consolidated operating loss despite lower sales, driven primarily by positive impact of mattress fabrics restructuring, including improved operating efficiencies, lower fixed costs, and lower SG&A Net loss of $(4.1) million, improved sequentially from a net loss of $(5.6) million last quarter Adjusted EBITDA for the period was close to break even at negative $(123,000), a sequential improvement of approximately $1.1 million with $3.4 million less in sales as compared to last quarter (see reconciliation table on page 19) Current mattress fabrics restructuring initiatives substantially completed in January; also entered into a conditional agreement for the sale of the Canadian real estate, contingent on the satisfaction of due diligence and closing conditions - Currently expect to receive approximately $6.0 million to $8.0 million in cash proceeds (net of all taxes and commissions) from the real estate sale $5.3 million in cash, $5.4 million in outstanding borrowings used to fund worldwide working capital and restructuring initiatives "Our mattress fabrics segment continued to reduce its operating loss, building on the prior quarter improvement, and we also achieved near break-even consolidated adjusted EBITDA for the quarter, even with lower sequential sales. We are pleased that our restructuring initiatives within the mattress fabrics segment are mostly finished. The team has worked hard to execute on our plans and they are beginning to generate the savings and efficiency improvements we anticipated. "Additionally, we entered into an agreement for the sale of our Canadian mattress fabrics facility during the quarter, and we are working to close this transaction in the upcoming months. Assuming completion, we intend to use the cash proceeds to pay off outstanding borrowings and further bolster our liquidity. "Our consolidated sales for the third quarter were down sequentially, largely due to ongoing weakness in the home furnishings industry and, as expected, specific pressure on residential upholstery fabric sales that was exacerbated by some unique inventory adjustments from a large customer. Sales were also pressured in both segments by fewer shipping days due to holiday closures and weather-related disruptions during the quarter. However, we noted stronger demand in our upholstery fabrics hospitality/contract business, with both year-over-year and sequential increases in sales for the third quarter. Despite the tough residential demand environment, we remain pleased with this segment's continuing profitability, supported by our asset-light and flexible global platform. "Looking ahead at the various and ongoing macro-economic headwinds, including increasing tariff uncertainty, as well as industry consolidation, we believe we are well positioned in both businesses with strong customer relationships and a variety of agile manufacturing and sourcing options. We are confident that our actions to optimize the cost platform in our mattress fabrics segment will enable us to return to profitability post-restructuring, even at currently depressed demand levels. "Moreover, we took new and additional cost saving actions in the third quarter related to labor and professional fees that we expect will generate annual savings of approximately $1.0 million. We are also targeting further strategic actions to synergize and create more cost and operating efficiencies across our businesses going forward. Our management team continues to diligently focus on controlling what we can control and taking the critical steps to position our business for profitability as we head into fiscal 2026," added Culp. Restructuring Update The restructuring plan announced on May 1, 2024, primarily focused on the company's mattress fabrics segment, was substantially complete as of the end of the third quarter. The company still expects to generate $10.0 - $11.0 million in annualized savings and operating improvements following the restructuring, with most of the benefits beginning to be realized during the fourth quarter of fiscal 2025. These restructuring and restructuring-related costs and charges exclude any gain on the sale of owned real estate in Canada, the amount and precise timing of which is currently unknown, which would ultimately reduce the total amount of charges incurred. The company has entered into a conditional agreement for the sale of the Canadian real estate, contingent on the satisfaction of certain due diligence and closing conditions. Assuming completion of the transaction, the company currently anticipates receiving approximately $6.0 to $8.0 million in cash proceeds (net of all taxes and commissions). Third Quarter Fiscal 2025 Results versus Third Quarter Fiscal 2024 Results Net sales were $52.3 million, down 13.5 percent compared with the prior-year period, with mattress fabrics sales down 4.6 percent and upholstery fabrics sales down 22.4 percent. Loss from operations was $(3.9) million (which included $2.3 million in restructuring expense and related charges during the period), compared with a loss from operations of $(1.7) million for the prior-year period (which included $111,000 in restructuring and related credits during the period). Adjusted loss from operations was $(1.6) million, compared with an adjusted loss from operations of $(1.9) million for the prior-year period. (See reconciliation table on page 15). Adjusted operating performance as compared to the third quarter of fiscal 2024 was supported by improved operating efficiencies resulting from the mattress fabrics segment's restructuring initiatives, lower fixed costs, and lower SG&A. Net loss was $(4.1) million, or $(0.33) per diluted share, compared with a net loss of $(3.2) million, or $(0.26) per diluted share, for the prior-year period. The effective tax rate for the third quarter was negative (12.1) percent, reflecting the company's mix of taxable income between its U.S. and foreign jurisdictions during the period. Business Segment Highlights Mattress Fabrics Segment (“CHF”) Sales for this segment were $28.6 million for the third quarter, down 4.6 percent compared with sales of $30.0 million in the third quarter of fiscal 2024. Sequentially, sales were down 4.8 percent compared with sales of $30.1 million for the second quarter of fiscal 2025. While year-over-year sales were pressured by ongoing weakness in the domestic mattress industry, the company believes CHF is outperforming the industry average and is growing its market position through investments in manufacturing platform flexibility, product diversification, and design innovation. Sequentially, sales were negatively affected by fewer billing days due to holiday closures and weather events during the third quarter that did not affect the second quarter. Operating loss was $(433,000) for the third quarter, compared to an operating loss of $(1.6) million in the prior-year period and compared to an operating loss of $(1.0) million for the second quarter of fiscal 2025. The improvement in operating performance for the quarter, as compared to both the prior-year and sequential periods, was driven by the impacts of CHF's restructuring initiatives, including improved operating efficiencies and lower fixed costs. Sales for this segment were $23.6 million for the third quarter, down 22.3 percent compared with sales of $30.4 million in the third quarter of fiscal 2024. Sequentially, sales were down 7.8 percent compared with sales of $25.6 million for the second quarter of fiscal 2025. Sales for CUF's residential fabrics business were lower than the prior-year period and lower sequentially. As expected, year-over-year and sequential sales were pressured by lower orders from a significant customer to adjust its inventory to align with soft industry demand. Year-over-year sales were also pressured by demand weakness in the home furnishings industry and weather-related disruptions. Sales for CUF's hospitality/contract business (including Read Window) were significantly higher compared to the prior-year period and slightly higher sequentially. Sales from CUF's hospitality/contract business accounted for approximately 40 percent of CUF's total sales during the third quarter. Operating income was $679,000 for the third quarter, compared to operating income of $2.1 million for the third quarter of fiscal 2024 and compared to operating income of $615,000 for the second quarter of fiscal 2025. Operating performance for the third quarter of fiscal 2025, as compared to the prior-year period, was affected by lower sales, partially offset by lower fixed costs, lower SG&A, and a more favorable foreign currency exchange rate associated with CUF's operations in China. Balance Sheet, Cash Flow, and Liquidity As of January 26, 2025, the company reported $5.3 million in total cash and $5.4 million in outstanding debt under its China credit facilities. The outstanding debt was primarily used in connection with restructuring activities, the timing of the Chinese new year holiday, and to fund worldwide working capital. Cash flow from operations and free cash flow were negative $(9.4) million and negative $(10.1) million, respectively, for the first nine months of fiscal 2025. (See reconciliation table on page 12 of this press release.) The company's cash flow from operations and free cash flow during the first nine months of fiscal 2025 were primarily affected by operating losses, including $4.2 million in non-recurring cash restructuring charges, and, with respect to free cash flow, planned strategic investments in capital expenditures mostly related to the mattress fabrics segment, partially offset by lower working capital. Capital expenditures for the first nine months of fiscal 2025 were $2.4 million, down from $3.2 million for the first nine months of fiscal 2024. The company continues to strategically manage capital investments, focusing on projects that will increase efficiency and improve quality, especially for the mattress fabrics segment. As of January 26, 2025, the company had approximately $28.5 million in liquidity consisting of $5.3 million in cash and $23.2 million in borrowing availability under the company's domestic credit facility. The company intends to continue utilizing some borrowings under its domestic and foreign credit facilities during fiscal 2025 in connection with its restructuring activities and to fund worldwide working capital to grow the business. Assuming completion of the sale of the company's Canadian real estate, the company intends to use the expected $6.0 million to $8.0 million in cash proceeds to retire outstanding borrowings. Financial Outlook Due to macro-economic and increasing tariff uncertainty, the company expects continued industry sales pressure and is only providing limited financial guidance at this time. - Consolidated net sales for the fourth quarter expected to show some growth year-over-year (and expected to remain flat sequentially), with an expected increase in the mattress fabrics segment, offset by ongoing pressure on residential upholstery fabric sales due to weak industry demand and impact from the timing of the Chinese new year holiday (which this year falls entirely in the fourth quarter). - Currently expect continued sequential improvement in adjusted EBITDA (excluding restructuring and related charges), with further improvement in mattress fabrics profitability in the fourth quarter; and a foundation for a return to consolidated operating income in fiscal 2026. The company's expectations are based on information available at the time of this press release and reflect certain assumptions by management regarding the company's business and trends, the projected impact of restructuring actions, and ongoing market headwinds. The company's expectations also assume no further meaningful impacts from tariffs and trade negotiations. Conference Call Culp, Inc. will hold a conference call to discuss financial results for the fiscal 2025 third quarter on Thursday, March 6, 2025, at 9:00 a.m. Eastern Time. A live webcast of this call can be accessed on the “Upcoming Events” section on the investor relations page of the company's website, . A replay of the webcast will be available for 30 days under the “Past Events” section on the investor relations page of the company's website, beginning at 2:00 p.m. Eastern Time on March 6, 2025. Many of these factors are macroeconomic in nature and are, therefore, beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results, performance or achievements may vary materially from those described in this release as anticipated, believed, estimated, expected, intended, planned or projected. The forward-looking statements included in this release are made only as of the date of this report. Unless required by United States federal securities laws, we neither intend nor assume any obligation to update these forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in our expectations. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations or financial results. CULP, INC. CONSOLIDATED STATEMENTS OF NET LOSS FOR THE THREE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 (Amounts in Thousands, Except for Per Share Data) THREE MONTHS ENDED Amount January 28, % Over January 26, January 28, (Under) Net sales Cost of sales (1) Gross profit Selling, general and administrative expenses Restructuring (expense) credit (2) N.M Loss from operations Interest expense — — Interest income Other income (expense) Loss before income taxes Income tax expense (3) Net loss Net loss per share - basic Net loss per share - diluted Average shares outstanding-basic Average shares outstanding-diluted Notes See page 15 for a Reconciliation of Selected Income Statement Information to Adjusted Results for the three months ending January 26, 2025, and January 28, 2024. See page 17 for a Summary of Restructuring Expense (Credit) for the three months ending January 26, 2025, and January 28, 2024. Percent of sales column for income tax expense is calculated as a percent of loss before income taxes. CULP, INC. CONSOLIDATED STATEMENTS OF NET LOSS FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands, Except for Per Share Data) NINE MONTHS ENDED Amount Percent of Sales January 26, January 28, % Over January 26, January 28, (Under) Net sales Cost of sales (1) Gross profit Selling, general and administrative expenses Restructuring expense (2) N.M. Loss from operations Interest expense — — Interest income Other expense Loss before income taxes Income tax expense (3) Net loss Net loss per share - basic Net loss per share - diluted Average shares outstanding-basic Average shares outstanding-diluted Notes See page 16 for a Reconciliation of Selected Income Statement Information to Adjusted Results for the nine months ending January 26, 2025, and January 28, 2024. See page 18 for a Summary of Restructuring Expense (Credit) for the nine months ending January 26, 2025, and January 28, 2024. Percent of sales column for income tax expense is calculated as a percent of loss before income taxes. CONSOLIDATED BALANCE SHEETS JANUARY 26, 2025, JANUARY 28, 2024, AND APRIL 28, 2024 Unaudited (Amounts in Thousands) Amounts (Condensed) (Condensed) (Condensed) January 26, January 28, Increase (Decrease) * April 28, Dollars Percent Current assets Cash and cash equivalents Short-term investments - rabbi trust Accounts receivable, net Inventories Short-term notes receivable Current income taxes receivable Assets held for sale — — Other current assets Total current assets Property, plant & equipment, net Right of use assets Intangible assets Long-term investments - rabbi trust Long-term notes receivable Deferred income taxes Other assets Total assets Current liabilities Lines of credit — — Accounts payable - trade Accounts payable - capital expenditures N.M. Operating lease liability - current Deferred compensation - current Deferred revenue Accrued expenses Accrued restructuring — — Income taxes payable - current Total current liabilities Operating lease liability - long-term Income taxes payable - long-term Deferred income taxes Deferred compensation - long-term Total liabilities Shareholders' equity Total liabilities and shareholders' equity Shares outstanding * Derived from audited financial statements. CULP, INC. SUMMARY OF CASH AND DEBT JANUARY 26, 2025, JANUARY 28, 2024, AND APRIL 28, 2024 Unaudited (Amounts in Thousands) Amounts January 26, January 28, April 28, Cash: Cash and cash equivalents Less Debt: Lines of credit — — Net (debt) cash position * Derived from audited financial statements. CULP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) NINE MONTHS ENDED Amounts January 26, January 28, Cash flows from operating activities: Net loss Adjustments to reconcile net loss to net cash used in operating activities: Depreciation Non-cash inventory credit Amortization Stock-based compensation Deferred income taxes Gain on sale of equipment Non-cash restructuring expense Foreign currency exchange gain Changes in assets and liabilities: Accounts receivable Inventories — Other current assets Other assets Accounts payable - trade Deferred revenue Accrued restructuring — Accrued expenses and deferred compensation Income taxes Net cash used in operating activities Cash flows from investing activities: Capital expenditures Proceeds from the sale of equipment Proceeds from note receivable Proceeds from the sale of investments (rabbi trust) Purchase of investments (rabbi trust) Net cash used in investing activities Cash flows from financing activities: Proceeds from lines of credit — Payments on lines of credit — Common stock surrendered for withholding taxes payable Net cash provided by (used in) financing activities Effect of foreign currency exchange rate changes on cash and cash equivalents Decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of period Free Cash Flow (1) (1) See next page for Reconciliation of Free Cash Flow for the nine months ending January 26, 2025, and January 28, 2024. CULP, INC. RECONCILIATION OF FREE CASH FLOW FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) NINE MONTHS ENDED Amounts January 26, January 28, A) Net cash used in operating activities B) Minus: Capital expenditures C) Plus: Proceeds from the sale of equipment D) Plus: Proceeds from note receivable E) Plus: Proceeds from the sale of investments (rabbi trust) F) Minus: Purchase of investments (rabbi trust) G) Effects of foreign currency exchange rate changes on cash and cash equivalents Free Cash Flow CULP, INC. STATEMENTS OF OPERATIONS BY SEGMENT FOR THE THREE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) THREE MONTHS ENDED Amounts Percent of Total Sales January 26, January 28, % Over January 26, January 28, Net Sales by Segment (Under) Mattress Fabrics Upholstery Fabrics Net Sales Gross Profit Gross Margin Mattress Fabrics Upholstery Fabrics Total Segment Gross Profit Restructuring Related (Charge) Credit (1) Gross Profit Selling, General and Administrative Expenses by Segment Percent of Sales Mattress Fabrics Upholstery Fabrics Unallocated Corporate Expenses Selling, General and Administrative Expenses (Loss) Income from Operations by Segment Operating Margin Mattress Fabrics Upholstery Fabrics Unallocated Corporate Expenses Total Segment Loss from Operations Restructuring Related (Charge) Credit (1) N.M Restructuring (Expense) Credit (2) N.M Loss from Operations Depreciation Expense by Segment Mattress Fabrics Upholstery Fabrics Depreciation Expense Notes See page 15 for a Reconciliation of Selected Income Statement Information to Adjusted Results for the three months ending January 26, 2025, and January 28, 2024. See page 17 for a Summary of Restructuring Expense (Credit) for the three months ending January 26, 2025, and January 28, 2024. CULP, INC. STATEMENTS OF OPERATIONS BY SEGMENT FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) NINE MONTHS ENDED Amounts Percent of Total Sales January 26, January 28, % Over January 26, January 28, Net Sales by Segment (Under) Mattress Fabrics Upholstery Fabrics Net Sales Gross Profit: Gross Margin Mattress Fabrics Upholstery Fabrics Total Segment Gross Profit Restructuring Related Charge (1) N.M. Gross Profit Selling, General and Administrative Expenses by Segment Percent of Sales Mattress Fabrics Upholstery Fabrics Unallocated Corporate Expenses Selling, General and Administrative Expenses (Loss) Income from Operations by Segment Operating Margin Mattress Fabrics Upholstery Fabrics Unallocated Corporate Expenses Total Segment Loss from Operations Restructuring Related Charge (1) N.M. Restructuring Expense (2) N.M. Loss from Operations Return on Capital Employed (ttm) (3) Mattress Fabrics Upholstery Fabrics Unallocated Corporate N.M. N.M. N.M. Consolidated Capital Employed (3) Mattress Fabrics Upholstery Fabrics Unallocated Corporate Consolidated Depreciation Expense by Segment Mattress Fabrics (4) Upholstery Fabrics Depreciation Expense Notes See page 16 for a Reconciliation of Selected Income Statement Information to Adjusted Results for the nine months ending January 26, 2025, and January 28, 2024. See page 18 for a Summary of Restructuring Expense (Credit) for the nine months ending January 26, 2025, and January 28, 2024. See pages 20 through 23 for calculation of Return on Capital Employed by Segment for the trailing twelve months ending January 26, 2025, and January 28, 2024, and a reconciliation to information from our U.S. GAAP financial statements. The capital employed balances are as of January 26, 2025, and January 28, 2024. During the nine-month period ending January 26, 2025, depreciation expense for the mattress fabrics segment included additional depreciation expense related to the shortening of useful lives of equipment associated with the gradual discontinuation of operations at our manufacturing facility located in Quebec, Canada. The amount of additional depreciation expense totaling $1.3 million was classified as restructuring expense in our Consolidated Statements of Net Loss. CULP, INC. RECONCILIATION OF SELECTED INCOME STATEMENT INFORMATION TO ADJUSTED RESULTS FOR THE THREE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) As Reported Adjusted Results January 26, January 26, Adjustments Net sales — Cost of sales (1) Gross profit Selling, general and administrative expenses — Restructuring expense (2) — Loss from operations Notes During the three months ending January 26, 2025, cost of sales included restructuring related charges totaling $624,000 for losses on the disposal, valuation, and markdowns of inventory related to the gradual discontinuation of operations at our manufacturing facility located in Quebec, Canada. See page 17 for a Summary of Restructuring Expense (Credit) for the three months ending January 26, 2025. As Reported Adjusted Results January 28, January 28, Adjustments Net sales — Cost of sales (1) Gross profit Selling, general and administrative expenses — Restructuring credit (2) — Loss from operations Notes During the three months ending January 28, 2024, cost of sales included a restructuring related credit totaling $61,000 for a gain on disposal of inventory related to the discontinuation of production of cut and sewn upholstery kits at the company's facility in Ouanaminthe, Haiti. See page 17 for a Summary of Restructuring Expense (Credit) for the three months ending January 28, 2024. CULP, INC. RECONCILIATION OF SELECTED INCOME STATEMENT INFORMATION TO ADJUSTED RESULTS FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) As Reported Adjusted Results January 26, January 26, Adjustments Net sales — Cost of sales (1) Gross profit Selling, general and administrative expenses — Restructuring expense (2) — Loss from operations Notes During the nine months ending January 26, 2025, cost of sales included restructuring related charges totaling $1.5 million for losses on the disposal, valuation, and markdowns of inventory related to the gradual discontinuation of operations at our manufacturing facility located in Quebec, Canada. See page 18 for a Summary of Restructuring Expense (Credit) for the nine months ending January 26, 2025. As Reported Adjusted Results January 28, January 28, Adjustments Net sales — Cost of sales (1) Gross profit Selling, general and administrative expenses — Restructuring expense (2) — Loss from operations Notes During the nine months ending January 28, 2024, cost of sales included restructuring related charges totaling $40,000 for markdowns of inventory related to discontinuing production of cut and sewn upholstery kits at the company's facility in Ouanaminthe, Haiti. See page 18 for a Summary of Restructuring Expense (Credit) for the nine months ending January 28, 2024. CULP, INC. SUMMARY OF RESTRUCTURING EXPENSE (CREDIT) FOR THE THREE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) The following summarizes restructuring expense (credit) for three-month period ending January 26, 2025: Upholstery Mattress Description Fabrics Fabrics Total Employee termination benefits — Impairment charges related to fixed assets — Gain on the sale of equipment — Facility consolidation and relocation expenses Cost incurred to ready a closed facility for sale — Other associated costs — Total restructuring expense (1) During the three months ending January 26, 2025, restructuring expense of $1.7 million represents costs associated with (i) consolidating the company's North American mattress fabrics operations, including the gradual discontinuation of operations at the mattress fabrics manufacturing facility located in Quebec, Canada, and moving a portion of the knitting and finishing capacity from the company's manufacturing facility located in Quebec, Canada to the company's U.S. manufacturing facility located in Stokesdale, NC; (ii) consolidating two leased facilities related to the sewn mattress cover operation located in Ouanaminthe, Haiti, into one facility and reducing other operating expenses at this location; and (iii) moving equipment from our upholstery fabrics operation located in Knoxville, Tennessee to our upholstery fabrics distribution center located in Burlington, N.C. The following summarizes restructuring expense (credit) for three-month period ending January 28, 2024: Upholstery Description Fabrics Gain on the disposal of equipment Total restructuring credit (1) During the three months ending January 28, 2024, the restructuring credit of $50,000 represents gains on the sale of equipment associated with the discontinuance production of cut and sewn upholstery kits at our facility located in Ouanaminthe, Haiti. CULP, INC. SUMMARY OF RESTRUCTURING EXPENSE (CREDIT) FOR THE NINE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) The following summarizes restructuring expense (credit) for nine-month period ending January 26, 2025: Upholstery Mattress Description Fabrics Fabrics Total Employee termination benefits Accelerated depreciation — Impairment charges related to fixed assets — Gain on the sale of equipment — Lease termination costs — Facility consolidation and relocation expenses Cost incurred to ready a closed facility for sale — Other associated costs Total restructuring expense (1) During the nine months ending January 26, 2025, restructuring expense of $6.3 million represents costs associated with (i) consolidating the company's North American mattress fabrics operations, including the gradual discontinuation of operations at the mattress fabrics manufacturing facility located in Quebec, Canada, and moving a portion of the knitting and finishing capacity from the company's manufacturing facility located in Quebec, Canada to the company's U.S. manufacturing facility located in Stokesdale, NC; (ii) consolidating two leased facilities related to the sewn mattress cover operation located in Ouanaminthe, Haiti, into one facility and reducing other operating expenses at this location; and (iii) moving equipment from our upholstery fabrics operation located in Knoxville, Tennessee to our upholstery fabrics distribution center located in Burlington, N.C. The following summarizes restructuring expense (credit) for nine-month period ending January 28, 2024: Upholstery Description Fabrics Employee termination benefits Impairment charges related to equipment Total restructuring expense (1) During the nine months ending January 28, 2024, restructuring expense of $432,000 represents costs related to the discontinuance of production of cut and sewn upholstery kits at our facility located in Ouanaminthe, Haiti. CULP, INC. CONSOLIDATED STATEMENTS OF ADJUSTED EBITDA FOR THE TWELVE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) Quarter Ended Quarter Ended Quarter Ended Quarter Ended Trailing 12 Months April 28, July 28, October 27, January 26, January 26, Net loss Income tax expense (benefit) Interest income, net Depreciation expense Restructuring expense Restructuring related charge — Amortization expense Stock based compensation Adjusted EBITDA % Net Sales Quarter Ended Quarter Ended Quarter Ended Quarter Ended Trailing 12 Months April 30, July 30, October 29, January 28, January 28, Net loss Income tax expense Interest income, net Depreciation expense Restructuring expense (credit) Restructuring related charge (credit) — Amortization expense Stock based compensation Adjusted EBITDA % Net Sales % Over (Under) CULP, INC. RETURN ON CAPITAL EMPLOYED BY SEGMENT FOR THE TWELVE MONTHS ENDED JANUARY 26, 2025 Unaudited (Amounts in Thousands) Adjusted Operating (Loss) Income Twelve Months Ended Average Capital Return on Avg. Capital January 26, 2025 (1) Employed (2) Employed (3) Mattress Fabrics Upholstery Fabrics Unallocated Corporate N.M. Consolidated Average Capital Employed As of the Three Months Ended January 26, 2025 As of the Three Months Ended October 27, 2024 As of the Three Months Ended July 28, 2024 Mattress Upholstery Unallocated Mattress Upholstery Unallocated Mattress Upholstery Unallocated Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Total assets (4) Total liabilities Subtotal Cash and cash equivalents — — — — — — Short-term investments - Rabbi Trust — — — — — — Current income taxes receivable — — — — — — Long-term investments - Rabbi Trust — — — — — — Deferred income taxes - non-current — — — — — — Lines of credit — — — — — — Deferred compensation - current — — — — — — Accrued restructuring Income taxes payable - current — — — — — — Income taxes payable - long-term — — — — — — Deferred income taxes - non-current — — — — — — Deferred compensation non-current — — — — — — Total Capital Employed CULP, INC. RETURN ON CAPITAL EMPLOYED BY SEGMENT - CONTINUED FOR THE TWELVE MONTHS ENDED JANUARY 26, 2025 Unaudited (Amounts in Thousands) As of the Three Months Ended April 28, 2024 As of the Three Months Ended January 28, 2024 Mattress Upholstery Unallocated Mattress Upholstery Unallocated Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Total assets (4) Total liabilities Subtotal Cash and cash equivalents — — — — Short-term investments - Rabbi Trust — — — — Current income taxes receivable — — — — Long-term investments - Rabbi Trust — — — — Deferred income taxes - non-current — — — — Deferred compensation - current — — — — Income taxes payable - current — — — — Income taxes payable - long-term — — — — Deferred income taxes - non-current — — — — Deferred compensation non-current — — — — Total Capital Employed Mattress Upholstery Unallocated Fabrics Fabrics Corporate Consolidated Average Capital Employed (2) Notes (1) See last page of this presentation for calculation. (2) Average capital employed is calculated independently for each segment and on a consolidated basis using the five quarterly periods ending January 26, 2025, October 27, 2024, July 28, 2024, April 28, 2024, and January 28, 2024. (3) Return on average capital employed represents the twelve months adjusted operating (loss) income as of January 26, 2025, divided by average capital employed. Average capital employed does not include cash and cash equivalents, short-term and long-term investments – rabbi trust, income taxes receivable and payable, accrued restructuring, lines of credit, non-current deferred income tax assets and liabilities, and current and non-current deferred compensation. (4) Intangible assets are included in unallocated corporate for all periods presented and therefore, have no effect on capital employed and return on capital employed for our mattress fabrics and upholstery fabrics segments. CULP INC. RETURN ON CAPITAL EMPLOYED BY SEGMENT FOR THE TWELVE MONTHS ENDED JANUARY 28, 2024 Unaudited (Amounts in Thousands) Adjusted Operating (Loss) Income Twelve Months Ended Average Capital Return on Avg. Capital January 28, 2024 (1) Employed (2) Employed (3) Mattress Fabrics Upholstery Fabrics Unallocated Corporate N.M. Consolidated Average Capital Employed As of the Three months ended January 28, 2024 As of the Three months ended October 29, 2023 As of the Three Months Ended July 30, 2023 Mattress Upholstery Unallocated Mattress Upholstery Unallocated Mattress Upholstery Unallocated Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Total assets (4) Total liabilities Subtotal Cash and cash equivalents — — — — — — Short-term investments - Rabbi Trust — — — — — — Current income taxes receivable — — — — — — Long-term investments - Rabbi Trust — — — — — — Deferred income taxes - non-current — — — — — — Deferred compensation - current — — — — — — Accrued restructuring — — — — — — — — — — Income taxes payable - current — — — — — — Income taxes payable - long-term — — — — — — Deferred income taxes - non-current — — — — — — Deferred compensation - long-term — — — — — — Total Capital Employed CULP INC. RETURN ON CAPITAL EMPLOYED BY SEGMENT - CONTINUED FOR THE TWELVE MONTHS ENDED JANUARY 28, 2024 Unaudited (Amounts in Thousands) As of the Three Months Ended April 30, 2023 As of the Three Months Ended January 29, 2023 Mattress Upholstery Unallocated Mattress Upholstery Unallocated Fabrics Fabrics Corporate Total Fabrics Fabrics Corporate Total Total assets (4) Total liabilities Subtotal Cash and cash equivalents — — — — Short-term investments - Rabbi Trust — — — — Current income taxes receivable — — — — — — Long-term investments - Rabbi Trust — — — — Deferred income taxes - non-current — — — — Deferred compensation - current — — — — Income taxes payable - current — — — — Income taxes payable - long-term — — — — Deferred income taxes - non-current — — — — Deferred compensation - long-term — — — — Total Capital Employed Mattress Upholstery Unallocated Fabrics Fabrics Corporate Consolidated Average Capital Employed (2) Notes See last page of this presentation for calculation. Average capital employed is calculated independently for each segment and on a consolidated basis using the five quarterly periods ending January 28, 2024, October 29, 2023, July 30, 2023, April 30, 2023, and January 29, 2023. Return on average capital employed represents the last twelve months adjusted operating (loss) income as of January 28, 2024, divided by average capital employed. Average capital employed does not include cash and cash equivalents, short-term and long-term investments – rabbi trust, income taxes receivable and payable, accrued restructuring, noncurrent deferred income tax assets and liabilities, and current and non-current deferred compensation. Intangible assets are included in unallocated corporate for all periods presented and therefore, have no effect on capital employed and return on capital employed for our mattress fabrics and upholstery fabrics segments. CULP INC. CONSOLIDATED STATEMENTS OF ADJUSTED OPERATING (LOSS) INCOME FOR THE TWELVE MONTHS ENDED JANUARY 26, 2025, AND JANUARY 28, 2024 Unaudited (Amounts in Thousands) Quarter Ended Trailing 12 Months Mattress Fabrics Upholstery Fabrics Unallocated Corporate Adjusted operating loss Quarter Ended Trailing 12 Months Mattress Fabrics Upholstery Fabrics Unallocated Corporate Adjusted operating loss % Over (Under) View source version on businesswire.com: This article contains syndicated content. We have not reviewed, approved, or endorsed the content, and may receive compensation for placement of the content on this site. For more information please view the Barchart Disclosure Policy
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• Publisher

  Publisher Name	sogotradedev.websol.barchart.com
  Publisher URL	http://sogotradedev.websol.barchart.com
  Description	None
  Trust Flow Score	25
  Citation Flow Score	30

• Data Source

  Data Source Name	Quantexa News
  Data Source Type	news
  Data Source URL	https://app.aylien.com/dashboard
  Description	Welcome to Quantexa News API — the most powerful way to aggregate, filter, and integrate global news data into your apps and models.
  Weight	10