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Upholstery Fabrics Segment Restructuring
3 Months Ended
Jul. 30, 2023
Restructuring and Related Activities [Abstract]  
Upholstery Fabrics Segment Restructuring . Upholstery Fabrics Segment Restructuring

During the third and fourth quarters of fiscal 2023, CUF Haiti entered into an agreement to terminate a lease associated with a facility located in Ouanaminthe, Haiti and, in turn, moved the production of upholstery cut and sewn kits to an existing facility leased by Culp Home Fashions Haiti, Ltd. (“CHF Haiti”). Both CUF Haiti and CHF Haiti are indirect wholly-owned subsidiaries of Culp, Inc. During the first quarter of fiscal 2024, demand for upholstery cut and sewn kits declined more than previously anticipated, resulting in the strategic action to discontinue the production of upholstery cut and sew kits in Haiti in the latter part of the first quarter of fiscal 2024.

 

The following summarizes our restructuring expense and restructuring related charges from the above restructuring activity for the three months ending July 30, 2023:

 

 

 

Three Months Ended

 

(dollars in thousands)

 

 

July 30, 2023

 

Employee termination benefits

 

 

$

101

 

Impairment loss - equipment

 

 

 

237

 

Loss on disposal and markdowns of inventory

 

 

 

179

 

Restructuring expense and restructuring related charges (1)

 

 

$

517

 

 

(1) Of the total $517,000, $338,000 and $179,000 were recorded within restructuring expense and cost of sales, respectively, in the Consolidated Statement of Net Loss for the three-month period ending July 30, 2023.

 

The following summarizes the activity in accrued restructuring costs for the three-month period ending July 30, 2023:

 

 

 

 

Employee

 

 

 

 

 

 

Termination

 

 

 

(dollars in thousands)

 

 

Benefits

 

Total

 

Beginning balance

 

 

$

 

$

 

Expenses incurred

 

 

 

101

 

 

101

 

Payments

 

 

 

(91

)

 

(91

)

Ending balance

 

 

$

10

 

$

10