Culp 2Q sales drop 11.1%
By Furniture Today Staff -- Furniture Today, December 11, 2005
High Point — Feeling the effects of shortages and surcharges related to hurricanes Katrina and Rita, fabric supplier Culp said sales declined 11.1% to $67 million in its second quarter ended Oct. 30.
The company reported a net loss of $4.2 million, about even with the comparable quarter a year ago.
Most of the losses in both quarters were attributed to restructuring and related charges, amounting to $3.8 million after taxes in the recent period and $4.7 million a year earlier. Excluding those charges, the company said it had a net loss of $332,000 in the recent quarter, compared with a profit of $505,000 a year ago.
For the six months ended Oct. 30, Culp said sales were down 9.7% from a year earlier to $129.3 million. The net loss in this year's first half was $8.1 million, compared with a $5.2 million loss a year earlier. Excluding restructuring and related charges, the first-half loss was $960,000 this year and $589,000 last year.
Rob Culp, chairman and CEO, said that although the company's transition to a "leaner and more agile business model is affecting our reported financial results, we believe we are taking the right steps to be competitive and position the company for growth over the long term in today's global marketplace."
He said he expects improved operating results in the fiscal second half in both of Culp's key product segments, upholstery fabrics and mattress ticking.
Upholstery fabric sales in the second quarter came to $43 million, down 11.3% from a year earlier. Yards sold declined 9.5%, while average selling prices were down 2.6%.
"Our non-U.S. operations continue to report favorable growth trends," Culp said. "Sales of upholstery fabrics produced outside our U.S. manufacturing plants, including fabrics produced at our China facility, were up 79% year-over-year, and accounted for 29% of Culp's upholstery fabric sales for the quarter."
Mattress ticking sales for the second quarter were $24 million, down 10.8% from a year ago. Unit volume declined 2.3% and the average selling price was down 8.1%.
| Culp Inc. | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 10/30 | 2005 | 2004 | Change |
| (a) Includes pretax restructuring expense of $4.4 million in the 2005 quarter, $1.3 million in the 2004 quarter, $6.2 million in the 2005 six months and $1.2 million in the 2004 six months and income tax benefits of $2.4 million in the 2005 quarter, $2.6 million in the 2004 quarter, $4.6 million in the 2005 six months and $3.1 million in the 2004 six months. The 2005 periods also include a $5.1 million pretax charge for goodwill impairment. |
|||
| Sales | $67,006,000 | $75,406,000 | (11.1%) |
| Operating income | (975,000) | 729,000 | — |
| Net income (a) | (4,152,000) | (4,193,000) | — |
| Earnings per share | (0.36) | (0.36) | — |
| 6 months ended 10/30 | 2005 | 2004 | Change |
| Sales | $129,348,000 | $143,255,000 | 9.7% |
| Operating income | (4,274,000) | 124,000 | — |
| Net income (a) | (8,093,000) | (5,245,000) | — |
| Earnings per share | (0.70) | (0.45) | — |
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Culp 2Q sales drop 11.1%
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Culp 2Q sales down 11.1%
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