In its first fiscal quarter of 2020, which ended Aug. 4, Culp Inc. reported pretax income of $2.8 million, compared with pretax income of $1.9 million in the first quarter of fiscal 2019. Excluding restructuring and other charges related to the High Point, North Carolina-based company’s closure of a production facility in Anderson, South Carolina, pretax income was $4 million.
Net sales in the first quarter totaled $74.8 million, a 4.7% increase compared with the prior-year period. Mattress fabric sales rose 12.5% and upholstery fabric sales dropped 7.6%. Net sales for home accessories were $4.3 million. There is no comparable prior-year period for accessories sales, as they relate to Culp’s June 2018 investment in eLuxury.com.
“We are pleased to report a solid start to fiscal 2020 with our overall sales in line with expectations,” said Frank Saxon, chair and chief executive officer. “We are especially encouraged to see higher sales in mattress fabrics, following a difficult year of declining sales related to the influx of low-cost mattress imports from China, as well as retail disruption. … We have also faced considerable external challenges in the upholstery fabrics business due to the ongoing international trade disputes and recently imposed additional tariffs. However, in spite of lower sales and uncertain market conditions, our upholstery fabrics business showed improved profitability for the first quarter of fiscal 2020. Additionally, we continue to evaluate and develop our strategy for Culp Home Accessories, our finished products business.”
Commenting further on first-quarter mattress fabric sales, Iv Culp, president and chief operating officer, said: “In addition to an extra week of sales for the quarter, these results reflect a strong performance from CLASS, our sewn mattress cover business, as well as higher than expected sales of woven mattress fabrics. We are benefitting from the growing demand for mattress covers from customers in the popular and expanding roll-packed (boxed) bedding space. … As a firm acknowledgement of the evolving trends in bedding and mattresses, we have established a dedicated innovation team to ensure we are developing and offering the latest technologies and forward-looking products for our customers.”
