Business
Culp Announces Results for Third Quarter Fiscal 2023
HIGH POINT, N.C.--(BUSINESS WIRE)-- Culp, Inc. (NYSE: CULP) (together with its consolidated subsidiaries, “CULP”) today reported financial and operating
About this update from Culp, Inc.
[{"type":"text","content":" HIGH POINT, N.C.--(BUSINESS WIRE)--\nCulp, Inc. (NYSE: CULP) (together with its consolidated subsidiaries, “CULP”) today reported financial and operating results for the third quarter ended January 29, 2023.\n\nFiscal 2023 Third Quarter Financial Summary\n\n\nNet sales were $52.5 million, down 34.6 percent compared with the prior-year period, with mattress fabrics sales down 35.8 percent and upholstery fabrics sales down 33.5 percent compared with the third quarter of last year.\n\n\nLoss from operations was $(7.8) million, in line with expectations, as compared with income from operations of $1.1 million for the prior-year period.\n\n\nThe loss from operations for the third quarter of fiscal 2023 includes $711,000 in restructuring expense relating to a rationalization of the upholstery fabrics cut and sew platform located in Ouanaminthe, Haiti.\n\n\nNet loss was $(9.0) million, or $(0.73) per diluted share, compared with a net loss of $(289,000), or $(0.02) per diluted share, for the prior-year period. The effective tax rate for the third quarter was negative (3.3)%, reflecting the company’s mix of taxable income between its U.S. and foreign jurisdictions during the period.\n\n\nThe company maintained a solid balance sheet, with total cash and investments of $16.7 million and no outstanding borrowings as of January 29, 2023. (See summary of cash and investments table at the back of this press release.)\n\n\nCash flow from operations and free cash flow were $4.6 million and $2.5 million, respectively, for the first nine months of fiscal 2023, compared with cash flow from operations and free cash flow of negative $(12.4) million and negative $(18.5) million, respectively, for the first nine months of fiscal 2022. (See reconciliation table at the back of this press release.)\n\n\nOn January 19, 2023, the company closed on a new three-year asset-based revolving credit facility of up to $35 million.\n\n\nFinancial Outlook\n\n\nThe company continues to navigate a difficult demand environment as a result of elevated inventory levels at manufacturers and retailers, as well as shifting consumer spending trends and weakening consumer confidence. The company is also experiencing operating inefficiencies due to this reduced demand as well as an improving but still inexperienced labor force. Although CULP remains well-positioned over the l...