Fabric supplier Culp Inc. said sales rose 15% to $60.4 million in the quarter ended Jan. 28, thanks to an uptick in its mattress fabric and upholstery fabric businesses.
The top-line improvement enabled the company to slash its net loss for the quarter to $3.2 million or 26 cents per share. In the same quarter last year, Culp had a loss of $9 million or 73 cents per share.
The High Point, North Carolina-based company also cut its operating loss to $1.7 million from $7.8 million in the comparable quarter.
“We are pleased to report continued year-over-year and sequential improvement in our consolidated sales and operating performance for the third quarter,” said Iv Culp, president and CEO. “Both of our core business segments reported increased revenue year-over-year, which is impressive considering the challenging demand environment in the bedding and furniture industries.”
During the quarter — the third quarter of the company’s fiscal year — mattress fabric sales were 21.6% higher than the same quarter last year, while upholstery fabric sales were 9.2% above the comparable quarter.
Culp said the higher mattress fabric sales were driven by new fabric and cover placements that are priced in line with current raw materials costs.
“I feel like we are gaining some market share,” he said of the mattress fabrics business. “We’ve been on a good trajectory for the first nine months of our fiscal year.”
Upholstery fabric sales were aided by the timing of Chinese New Year, which this year falls largely in the fourth fiscal quarter, but the company said there was some improvement in residential home furnishings sales. Sales of fabric for the hospitality and contract markets were slightly lower than the same quarter last year, however.
For the nine months ended Jan. 28, companywide sales totaled $175.8 million, up 1.3% from $173.5 million in the comparable nine-month period.
The nine-month net loss totaled $8.95 million or 72 cents per share. That was down from a loss of $28.84 million or $2.19 per share in the first nine months of the previous fiscal year.
For the first nine months of the fiscal year, mattress fabric sales were up 12.9% to $90.6 million, while upholstery fabric sales were down 8.6% to $85.2 million.
Culp said the company is forecasting a sales decline in the fourth quarter due to continued weak consumer demand in both of its business segments
“Demand is still weak, but it will be back,” said Culp. “And when that happens, we’ll be in a good position.”
