Strong ticking, fabric business drives Culp sales up 14.8%
Larry Thomas -- Furniture Today, September 3, 2012
HIGH POINT - Fabric supplier Culp Inc. reported double digit increases in sales and net income for the quarter ended July 29 as its mattress ticking and upholstery fabric segments turned in solid performances.
The company's largest segment, mattress ticking, had an 18% jump in sales, while upholstery fabric sales rose 11.1%.
Total sales for the quarter, the first quarter of Culp's fiscal year, were $69.2 million, up 14.8% from $60.3 million in the same quarter last year.
Net income was $3.52 million or 28 cents per share. That compares with $1.82 million or 14 cents per share in last year's first fiscal quarter.
"These results reflect better than expected sales momentum through the summer months in both of our businesses," said Frank Saxon, president and CEO.
The company said the growth in mattress fabrics reflects increasing consumer demand for better bedding and a higher-quality ticking, while sales of upholstery fabrics grew because of "outstanding response to our innovative designs and new product introductions."
About 85% of Culp's upholstery fabric sales came from products made in China, but Saxon said the company also had increased demand for the velvets and woven texture fabrics made at its U.S. plant.
"We were especially pleased with the turnaround in our U.S. operation compared with this time last year," said Saxon. "We have a much more efficient U.S. operation with higher capacity utilization than a year ago."
The company repurchased 47,296 of its shares during the quarter, and has bought back another 455,299 shares since the quarter ended. Since initiating the repurchase program in June 2011, the company has acquired 1.13 million shares, or about 8.5% of its outstanding shares, for about $10.4 million.
Culp's board of directors recently authorized the repurchase of up to $2 million worth of additional shares.
For the current quarter, the company is projecting a sales increase of 2% to 6%. The company said it expects upholstery fabric sale to be flat, while mattress ticking sales should increase 3% to 8%.
Earnings per share are fully diluted.
Quarter ended 7/29
Earnings per share