8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported)    June 12, 2014

Culp, Inc.

(Exact Name of Registrant as Specified in its Charter)

North Carolina	1-12597	56-1001967
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1823 Eastchester Drive

        High Point, North Carolina  27265

(Address of Principal Executive Offices)

(Zip Code)

(336) 889-5161

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former name or address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

INDEX

	Page
Item 2.02 – Results of Operations and Financial Condition	3
Item 9.01(d) - Exhibits	5
Signature	6
Exhibits	7

2

This report and the exhibits attached hereto contain “forward-looking statements” within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 27A of the Securities and Exchange Act of 1934).  Such statements are inherently subject to risks and uncertainties.  Further, forward looking statements are intended to speak only as of the date on which they are made, and we disclaim any duty to update such statements.  Forward-looking statements are statements that include projections, expectations or beliefs about future events or results or otherwise are not statements of historical fact.  Such statements are often but not always characterized by qualifying words such as “expect,” “believe,” “estimate,” “plan” and “project” and their derivatives, and include but are not limited to statements about expectations for our future operations, production levels, sales, gross profit margins, operating income, SG&A or other expenses, earnings, cash flow, and other performance measures, as well as any statements regarding future economic or industry trends or future developments. Factors that could influence the matters discussed in such statements include the level of housing starts and sales of existing homes, consumer confidence, trends in disposable income, and general economic conditions.  Decreases in these economic indicators could have a negative effect on our business and prospects.  Likewise, increases in interest rates, particularly home mortgage rates, and increases in consumer debt or the general rate of inflation, could affect us adversely. Changes in consumer tastes or preferences toward products not produced by us could erode demand for our products. Changes in the value of the U.S. dollar versus other currencies could affect our financial results because a significant portion of our operations are located outside the United States. Strengthening of the U.S. dollar against other currencies could make our products less competitive on the basis of price in markets outside the United States, and strengthening of currencies in Canada and China can have a negative impact on our sales of products produced in those places. Also, economic and political instability in international areas could affect our operations or sources of goods in those areas, as well as demand for our products in international markets. Further information about these factors, as well as other factors that could affect our future operations or financial results and the matters discussed in forward-looking statements, is included in Item 1A “Risk Factors” in our Form 10-K filed with the Securities and Exchange Commission on July 12, 2013 for the fiscal year ended April 28, 2013.

Item 2.02 – Results of Operations and Financial Condition

On June 12, 2014, we issued a news release to announce our financial results for the fourth quarter and the year ended April 27, 2014.  The news release is attached hereto as Exhibit 99(a).

Also on June 12, 2014, we released a Financial Information Release containing additional financial information and disclosures about our fourth quarter and year ended April 27, 2014.  The Financial Information Release is attached hereto as Exhibit 99(b).

The news release and Financial Information Release contain disclosures about free cash flow, a non-GAAP liquidity measure that we define as net cash provided by operating activities, less cash capital expenditures, plus any proceeds from sales of equipment, plus excess tax benefits related to stock-based compensation, minus the purchase of long-term investments, and plus or minus the effects of exchange rate changes on cash and cash equivalents.  Details of these calculations and a reconciliation to information from our GAAP financial statements is set forth in the Financial Information Release.  Management believes the disclosure of free cash flow provides useful information to investors because it measures our available cash flow for potential debt repayment, stock repurchases, dividends, and additions to cash and cash equivalents.  We note, however, that not all of the company’s free cash flow is available for discretionary spending, as we have mandatory debt payments and other cash requirements that must be deducted from our cash available for future use.  In operating our business, management uses free cash flow to make decisions about what commitments of cash to make for operations, such as capital expenditures (and financing arrangements for these expenditures), purchases of inventory or supplies, SG&A expenditure levels, compensation, and other commitments of cash, while still allowing for adequate cash to meet known future commitments for cash, such as debt repayment, and also for making decisions about dividend payments and share repurchases.

The news release and Financial Information Release contain disclosures about return on capital, both for the entire company and for individual business segments.  We define return on capital as operating income (on an annualized basis if at a point other than the end of the fiscal year) divided by average capital employed.  Operating income excludes certain non-recurring charges, and average capital employed is calculated over rolling two – five fiscal periods, depending on which quarter is being presented.  Details of these calculations and a reconciliation to information from our GAAP financial statements is set forth in the Financial Information Release.  We believe return on capital is an accepted measure of earnings efficiency in relation to capital employed, but it is a non-GAAP performance measure that is not defined or calculated in the same manner by all companies.  This measure should not be considered in isolation or as an alternative to net income or other performance measures, but we believe it provides useful information to investors by comparing the operating income we produce to the asset base used to generate that income.  Also, annualized operating income does not necessarily indicate results that would be expected for the full fiscal year.  We note that, particularly for return on capital measured at the segment level, not all assets and expenses are allocated to our operating segments, and there are assets and expenses at the corporate (unallocated) level that may provide support to a segment’s operations and yet are not included in the assets and expenses used to calculate that segment’s return on capital.  Thus, the average return on capital for the company’s segments will generally be different from the company’s overall return on capital.  Management uses return on capital to evaluate the company’s earnings efficiency and the relative performance of its segments.

3

The news release and Financial Information Release contain disclosures about our consolidated adjusted effective income tax rate, which is a non-GAAP liquidity measure that represents our estimated cash expenditures for income taxes.  The consolidated adjusted effective income tax rate is calculated by eliminating the non-cash items that affect our GAAP income tax expense, including adjustments to valuation allowances for deferred tax assets, reductions in income taxes due to net operating loss (NOL) carryforwards, and non-cash foreign income tax expenses.  Currently we do not pay income taxes in the U.S. due to NOL carryforward amounts, and thus the consolidated adjusted effective income tax rate represents income tax expense for our subsidiaries located in China and Canada. A reconciliation of our consolidated adjusted effective income tax rate to our consolidated effective GAAP income tax rate is set forth in the Financial Information Release.  We believe this information is useful to investors because it demonstrates the amount of cash, as a percentage of income before income taxes, expected to be required to fund our income tax liabilities incurred for the periods reported.  Our consolidated income tax expense on a GAAP basis can vary widely over different reporting periods due to the effects of non-cash items, and we believe the calculation of our consolidated adjusted effective tax rate is helpful in comparing financial reporting periods and the amount of income tax liability that we are or will be required to pay to taxing authorities in cash. We also note that, because the consolidated adjusted effective income tax rate used to calculate adjusted net income is based on annualized amounts and estimates, adjusted net income for any quarter or year-to-date period does not necessarily indicate results that could be expected for the full fiscal year. In addition, non-cash reductions in our U.S. NOL carryforwards are based on pre-tax losses in prior periods and will not be available to reduce taxes on current earnings once the NOL carryforward amounts are utilized.  Management uses the consolidated adjusted effective income rate to analyze the effect that income tax expenditures are likely to have on cash balances and overall liquidity.

The news release and Financial Information Release contains disclosures about our adjusted net income, which is a non-GAAP performance measure that incorporates the consolidated adjusted effective income tax rate discussed in the preceding paragraph.  Adjusted net income is calculated by multiplying the consolidated adjusted effective income tax rate by the amount of income before income taxes shown on our income statement.  Because the consolidated adjusted effective income tax rate eliminates non-cash items that affect our GAAP income tax expense, adjusted net income is intended to demonstrate the amount of net income that would be generated by our operations if only the cash portions of our income tax expense are deducted from income before income taxes.  As noted above, our consolidated income tax expense on a GAAP basis can vary widely over different reporting periods due to the effect of non-cash items, and we believe the calculation of adjusted net income is useful to investors because it eliminates these items and aids in the analysis of comparable financial periods by reflecting the amount of earnings available after the deduction of tax liabilities that are paid in cash.  Adjusted net income should not be viewed in isolation by investors and should not be used as a substitute for net income calculated in accordance with GAAP.  We also note that, because the consolidated adjusted effective income tax rate used to calculate adjusted net income is based on annualized amounts and estimates, adjusted net income for any quarter or year-to-date period does not necessarily indicate results that could be expected for the full fiscal year.  In addition, the limitations on the usefulness of consolidated adjusted effective income tax rates described in the preceding paragraph also apply to the usefulness of adjusted net income, since consolidated adjusted effective income tax rates are used to calculate adjusted net income.  Management uses adjusted net income to help it analyze the company’s earnings and performance after taking certain tax matters into account when comparing comparable quarterly and year-to-date periods.

4

The news release and Financial Information Release contains disclosures about our Adjusted EBITDA, which is a non-GAAP performance measure that reflects net income excluding tax expenses and net interest expense, as well as depreciation and amortization expense and stock based compensation expense.  Details of these calculations and a reconciliation to information from our GAAP financial statements is set forth in the Financial Information Release.  We believe presentation of Adjusted EBITDA is useful to investors because earnings before interest, income taxes, depreciation and amortization, and similar performance measures that exclude certain charges from earnings, are often used by investors and financial analysts in evaluating and comparing companies in our industry.  We note, however, that such measures are not defined uniformly by various companies, with differing expenses being excluded from net income to calculate these performance measures.  For this reason, Adjusted EBITDA should not be viewed in isolation by investors and should not be used as a substitute for net income calculated in accordance with GAAP, nor should it be used for direct comparisons with similarly titled performance measures reported by other companies.  Use of Adjusted EBITDA as an analytical tool has limitations in that this measure does not reflect all expenses that are necessary to fund and operate our business, including funds required to pay taxes, service our debt, and fund capital expenditures, among others.  Management uses Adjusted EBITDA to help it analyze the company’s earnings and operating performance, by excluding the effects of expenses that depend upon capital structure and debt level, tax provisions (which can be volatile for our company as described above), and non-cash items such as depreciation, amortization and stock based compensation expense that do not require immediate uses of cash.

Item 9.01 (d) -- Exhibits

99(a) News Release dated June 12, 2014

99(b) Financial Information Release dated June 12, 2014

5

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	CULP, INC.
	(Registrant)
By:	/s/ Kenneth R. Bowling
	Chief Financial Officer
	(principal financial officer)
By:	/s/ Thomas B. Gallagher, Jr.
	Corporate Controller
	(principal accounting officer)

Dated:  June 12, 2014

6

EXHIBIT INDEX

Exhibit Number	Exhibit
99(a)	News Release dated June 12, 2014
99(b)	Financial Information Release dated June 12, 2014

7

EX-99.(A)

Exhibit 99(a)

Investor Contact:	Kenneth R. Bowling	Media Contact:	Teresa A. Huffman
	Chief Financial Officer		Vice President, Human Resources
	336-881-5630		336-889-5161

CULP ANNOUNCES RESULTS FOR FOURTH QUARTER AND FISCAL 2014

Company Announces Special Cash Dividend of $0.40 Per Share

HIGH POINT, N.C. (June 12, 2014) ─ Culp, Inc. (NYSE: CFI) today reported financial and operating results for the fourth quarter and fiscal year ended April 27, 2014.

Fiscal 2014 Full Year Highlights

■   Net sales were $287.2 million, up 6.8 percent from fiscal 2013, representing the fifth consecutive year of overall annual sales growth, with mattress fabrics segment sales up 4.3 percent, a record year, and upholstery fabrics segment sales up 10.2 percent over the prior year.

■   Pre-tax income was $19.0 million, compared with $20.3 million in fiscal 2013.

■   Adjusted net income (non-GAAP) was $15.7 million, or $1.26 per diluted share, compared with $17.4 million, or $1.40 per diluted share, for the prior year period.  (Adjusted net income is calculated using estimated cash income tax expense.  See the reconciliation to net income on page 6).

■   Net income (GAAP) was $17.4 million, or $1.41 per diluted share, compared with net income of $18.3 million, or $1.47 per diluted share, last year.

■   Return on capital was 26 percent, compared with 29 percent in fiscal 2013.

■   Free cash flow was $13.8 million, after investing $7.2 million in working capital, capital expenditures and other items, compared with $13.1 million in fiscal 2013.

■   The company’s financial position remained strong with cash and cash equivalents and short term investments of $35.6 million and total debt of $5.0 million as of April 27, 2014, or a net cash position of $30.6 million, representing the highest level in the company’s history.  This compares to a net cash position of $21.7 million at the end of fiscal 2013.

Fiscal 2014 Fourth Quarter Highlights

■   Net sales were $74.0 million, up 5.2 percent, with mattress fabric sales up 6.9 percent and upholstery fabric sales up 2.8 percent, compared with the fourth quarter last year.

■   Pre-tax income was $4.1 million, compared with $5.9 million in the fourth quarter of fiscal 2013.

■   Adjusted net income (non-GAAP) was $3.4 million, or $0.27 per diluted share, for the current quarter, compared with $5.0 million, or $0.41 per diluted share, for the prior year period.

■   Net income (GAAP) was $2.7 million, or $0.22 per diluted share, compared with net income of $3.7 million, or $0.30 per diluted share, in the prior year period.

■   The company announced a special cash dividend of $0.40 per share and a quarterly cash dividend of $0.05 per share, both payable in July 2014.

■   The projection for first quarter fiscal 2015 is for overall sales to be in the range of 4 percent to 9 percent higher, compared with the previous year’s first quarter.  The first quarter of fiscal 2015 will be a 14-week period compared with 13 weeks in the first quarter of fiscal 2014.  Pre-tax income for the first quarter of fiscal 2015 is expected to be in the range of $4.8 million to $5.7 million.  Pre-tax income for the first quarter of fiscal 2014 was $5.5 million.

■   The company expects fiscal 2015 to be a good year for free cash flow.

CFI Announces Results for Fourth Quarter and Fiscal 2014

Page 2 

June 12, 2014

Overview

For the fourth quarter ended April 27, 2014, net sales were $74.0 million, a 5.2 percent increase compared with $70.4 million a year ago.  The company reported net income of $2.7 million, or $0.22 per diluted share, for the fourth quarter of fiscal 2014, compared with net income of $3.7 million, or $0.30 per diluted share, for the fourth quarter of fiscal 2013.

Given the volatility in the income tax area during fiscal 2014 and previous years, the company is reporting adjusted net income (non-GAAP), which is calculated using estimated cash income tax expense for its foreign subsidiaries.  (A presentation of adjusted net income and a reconciliation to net income is set forth on page 6).  The company currently does not incur cash income tax expense in the U.S., nor does it expect to for a number of years, due to approximately $45.7 million in U.S. net operating loss carryforwards as of the end of fiscal 2014.  For the fourth quarter of fiscal 2014, adjusted net income was $3.4 million, or $0.27 per diluted share, compared with $5.0 million, or $0.41 per diluted share, for the fourth quarter of fiscal 2013.  On a pre-tax basis, the company reported income of $4.1 million compared with pre-tax income of $5.9 million for the fourth quarter of fiscal 2013.

Net sales for fiscal 2014 were $287.2 million, up 6.8 percent, compared with net sales of $268.8 million in fiscal 2013.  Net income for fiscal 2014 was $17.5 million, or $1.41 per diluted share, compared with $18.3 million, or $1.47 per diluted share, in fiscal 2013.    Adjusted net income for fiscal 2014 was $15.7 million, or $1.26 per diluted share, compared with $17.4 million, or $1.40 per diluted share, in fiscal 2013.  On a pre-tax basis, the company reported income of $19.0 million for fiscal 2014, compared with pre-tax income of $20.3 million in fiscal 2013.

Commenting on the results, Frank Saxon, president and chief executive officer of Culp, Inc., said, “Culp had another solid performance in fiscal 2014 with higher annual sales in both businesses.  Notably, this is the fifth consecutive year of overall sales growth and a record year of annual sales for mattress fabrics. Throughout the year, we have continued to make outstanding progress with our strategic focus on design creativity and product innovation.  These efforts have been the key driver to our sales performance, with an increasing percentage of our sales coming from our latest product introductions.  Demand trends have been favorable, and our ability to sustain excellence in creating innovative fabrics season after season has been an important advantage for Culp in our fashion-driven business.

“Importantly, we achieved excellent free cash flow of $13.8 million in fiscal 2014.  As a result, we are pleased to announce today that our Board of Directors approved a special cash dividend of $0.40 per share, in line with our capital allocation strategy, as well as approved our regular quarterly cash dividend of $.0.05 per share.  This action reflects our commitment to delivering value to our shareholders.  At the same time, we have the financial strength to make strategic investments necessary to enhance and expand our production capabilities and take advantage of additional growth opportunities in fiscal 2015,” added Saxon.

Mattress Fabrics Segment

Mattress fabric sales for the fourth quarter were $43.7 million, up 6.9 percent compared with $40.8 million for the fourth quarter of fiscal 2013.  For fiscal 2014, mattress fabric sales were $160.7 million, a 4.3 percent increase compared with $154.0 million in fiscal 2013.

“Our mattress fabrics business had another solid sales performance in the fourth quarter of fiscal 2014, capping off another year of growth and record sales,” said Iv Culp, president of Culp’s mattress fabrics division.  “These results reflect the growing consumer demand for ‘better’ designed bedding products.  Culp is well positioned to meet this demand with a complete array of innovative fabrics and mattress covers across all leading categories.  With our extensive design capabilities and technical expertise, supported by a scalable manufacturing platform and reactive capacity, we have continued to expand our business with all the major players in the bedding industry.

“As previously announced, our operating profit and margins were affected by several factors during the fourth quarter of fiscal 2014.  The severe winter weather conditions experienced in many parts of the country affected our mattress fabrics locations with at least a week of lost production.  The interruption placed additional pressure on our operations to meet the ongoing sales demand.  During the quarter, we also had higher than expected demand for premium decorative knitted mattress fabrics, which stressed our production throughput and operating efficiencies.  In order to meet this growing demand and to improve our efficiency, we are increasing knitted fabric production at all of our facilities.  In addition, we are expanding our Stokesdale, North Carolina, building in order to increase and enhance our internal knit finishing capabilities and improve our production flow.  This first phase of the capacity expansion is anticipated to be completed by the end of December 2014.  The second phase, which will involve purchasing additional knit machines, is expected to be completed during the second half of fiscal 2015.  Our projected $9.5 million in capital expenditures for fiscal 2015 demonstrates Culp’s continued commitment to the future growth of our mattress fabrics business.

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CFI Announces Results for Fourth Quarter and Fiscal 2014

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June 12, 2014

“We have also made continued progress in fiscal 2014 with respect to the development of Culp-Lava, our mattress cover operation,” added Culp.  “The demand for new mattress covers has been better than expected and we are pleased by the market response for this category.  While our margins in this business showed significant improvement compared with the fiscal third quarter, we experienced short-term production challenges due to inefficiencies caused by absorbing new product placements.

“Overall, the fundamentals of our mattress fabrics business are strong, and Culp has a solid competitive position as we continue to outpace the overall industry growth.  We are especially pleased with the favorable customer response to our exciting designs and new product introductions that meet today’s style trends.  We are excited about the opportunities ahead in fiscal 2015 to grow our business and to enhance Culp’s leadership position in the bedding industry,” Culp concluded.

Upholstery Fabrics Segment

Sales for this segment were $30.4 million for the fourth quarter, a 2.8 percent improvement compared with sales of $29.6 million in the fourth quarter of fiscal 2013.  For fiscal 2014, upholstery fabric sales were $126.5 million, up 10.2 percent compared with $114.8 million in fiscal 2013.

“Overall, we are very pleased with the improved sales and profitability for upholstery fabrics in fiscal 2014,” noted Saxon.  “These results are product driven, with favorable customer response to our outstanding designs and innovative fabrics.  Our 100 percent owned China platform provides significant manufacturing flexibility to produce a variety of product categories, and we have continued to leverage this capability to meet changing customer demand in line with the latest furniture style trends.  Sales of China produced fabrics accounted for approximately 92 percent of upholstery fabric sales in fiscal 2014.  This platform has also supported our ability to expand our global market presence and reach new customers.  We had a great showing at the recent April furniture market with very positive feedback from customers and strong placements.

“Our upholstery fabrics business has experienced continued growth throughout fiscal 2014,” added Saxon.  “However, as previously announced, our operating results for the fourth quarter were affected by a couple of factors.  We experienced very strong shipments in the third quarter, with a 20 percent year over year sales increase, as our customers anticipated the Chinese New Year holiday shutdown.  As a result, we had a much slower than expected start to the fourth quarter.  Adverse winter weather conditions in the U.S. also affected our operating results early in the quarter because of weak customer demand.  With respect to Culp Europe, we did not achieve the level of sales we had expected for the fourth quarter of fiscal 2014.  However, our sales trends and operating margins returned to normal levels, except for Culp Europe, later in the fourth quarter and have continued to show improvement.  We believe Culp is well positioned for continued growth in upholstery fabrics, especially as business conditions improve with a more stable housing market and higher consumer spending for home furnishings.

Balance Sheet and Free Cash Flow

“We are very pleased to end fiscal 2014 with a strong financial position,” added Saxon.  “The company generated $13.8 million in free cash flow in fiscal 2014, after investing $7.2 million primarily in working capital and capital expenditures.  During fiscal 2014, we used the free cash flow to build our net cash position by approximately $9.0 million, to pay dividends of $2.2 million, and to make a small acquisition that totaled $2.6 million.  Looking ahead to fiscal 2015, we expect a good year of free cash flow, with capital expenditures projected to be higher than normal and modest growth in working capital.

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CFI Announces Results for Fourth Quarter and Fiscal 2014

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June 12, 2014

As of April 27, 2014, we reported $35.6 million in cash and cash equivalents and short-term investments.  Total debt at the end of fiscal 2014 was $5.0 million, which includes long-term debt plus current maturities of long-term debt and our line of credit.  Notably, our net cash position, or cash minus total debt, was $30.6 million at the end of the year compared with $21.7 million a year ago.  The $30.6 million is the highest net cash position in the company’s history.  Our next scheduled $2.2 million principal debt payment is due August 2014, with one remaining annual $2.2 million payment due August 2015.”

Dividends and Share Repurchases

Consistent with its capital allocation strategy, the company announced that its Board of Directors has approved the payment of a special cash dividend of $0.40 per share. In addition, the Board approved the payment of the company’s quarterly cash dividend of $0.05 per share.  Both of these payments will be made on July 15, 2014, to shareholders of record as of July 1, 2014.  Future dividend payments are subject to Board approval and may be adjusted at the Board’s discretion as business needs or market conditions change.

Following the end of the fourth quarter of fiscal 2014, the company purchased 22,101 shares of Culp common stock for approximately $380,000, pursuant to the $5.0 million share repurchase program authorized by the Board of Directors in February 2014.  The company did not repurchase any shares during fiscal 2014.

Saxon said, “The special dividend payment reflects our solid and consistent financial performance and strong free cash flow, along with the leadership position we have achieved in each of our businesses.  These actions reinforce our confidence in Culp’s future and our commitment to generating value for our shareholders through the payment of dividends and share repurchases.”

Outlook

Commenting on the outlook for the first quarter of fiscal 2015, Saxon remarked, “At this time, we expect overall sales to be up 4 percent to 9 percent as compared with the first quarter of fiscal 2014, which was a very strong first quarter of sales for both divisions.  The first quarter of fiscal 2015 will have one more week than the first quarter of the prior year, or 14 weeks compared with 13 weeks.

“We expect first quarter sales in our mattress fabrics business to be up 8 percent to 13 percent as compared with the same period a year ago.  Operating income in this segment is expected to approximate last year’s level, while margins are expected to be slightly lower as compared with the same period a year ago.

“In our upholstery fabrics business, we expect first quarter sales to be flat to slightly higher compared with the previous year’s first quarter results, which had exceptionally high sales.  We believe the upholstery fabric segment’s operating income and margins will be slightly down when compared with the same quarter of last year.

“Considering these factors, the company expects to report pre-tax income for the first fiscal quarter of 2015 in the range of $4.8 million to $5.7 million.  Pre-tax income for last year’s first quarter was $5.5 million.

“Based on our current budget, capital expenditures for fiscal 2015 are expected to be approximately $10 million, primarily related to expansion projects for mattress fabrics.  Additionally, the company expects a good year of free cash flow, even after an unusually high level of capital expenditures and modest growth in working capital.

In closing, Saxon remarked, “We are pleased with Culp’s performance in fiscal 2014 and our ability to drive sales and enhance our leadership position in a global marketplace.  Our consistent growth reflects our ability to meet changing customer demands and style trends with our creative designs and innovative fabrics.  We are building a strong economic moat in both businesses with our flexible and scalable global manufacturing platform, supported by design expertise, product innovation and outstanding customer service.  At the same time, we have maintained a solid financial position and generated strong free cash flow, allowing us to reward our shareholders with significant dividend payments and share repurchases.  Above all, we are committed to outstanding performance for our customers as a financially stable and trusted source for innovative fabrics.  We are excited about the opportunities before us as we look ahead to fiscal 2015 and beyond.”

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CFI Announces Results for Fourth Quarter and Fiscal 2014

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June 12, 2014

About the Company

Culp, Inc. is one of the world's largest marketers of mattress fabrics for bedding and upholstery fabrics for residential and commercial furniture.  The company markets a variety of fabrics to its global customer base of leading bedding and furniture companies, including fabrics produced at Culp’s manufacturing facilities and fabrics sourced through other suppliers.  Culp has operations located in the United States, Canada, China and Poland.

This release contains “forward-looking statements” within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 27A of the Securities and Exchange Act of 1934).  Such statements are inherently subject to risks and uncertainties.  Further, forward-looking statements are intended to speak only as of the date on which they are made, and we disclaim any duty to update such statements.  Forward-looking statements are statements that include projections, expectations or beliefs about future events or results or otherwise are not statements of historical fact.  Such statements are often but not always characterized by qualifying words such as “expect,” “believe,” “estimate,” “plan” and “project” and their derivatives, and include but are not limited to statements about expectations for our future operations, production levels, sales, gross profit margins, operating income, capital expenditures, taxes, SG&A or other expenses, earnings, cash flow, and other performance measures, as well as any statements regarding future economic or industry trends or future developments. Factors that could influence the matters discussed in such statements include the level of housing starts and sales of existing homes, consumer confidence, trends in disposable income, and general economic conditions.  Decreases in these economic indicators could have a negative effect on our business and prospects.  Likewise, increases in interest rates, particularly home mortgage rates, and increases in consumer debt or the general rate of inflation, could affect us adversely. Changes in consumer tastes or preferences toward products not produced by us could erode demand for our products. Changes in the value of the U.S. dollar versus other currencies could affect our financial results because a significant portion of our operations are located outside the United States. Strengthening of the U.S. dollar against other currencies could make our products less competitive on the basis of price in markets outside the United States, and strengthening of currencies in Canada and China can have a negative impact on our sales of products produced in those places. Also, economic and political instability in international areas could affect our operations or sources of goods in those areas, as well as demand for our products in international markets. Further information about these factors, as well as other factors that could affect our future operations or financial results and the matters discussed in forward-looking statements, is included in Item 1A “Risk Factors” in our Form 10-K filed with the Securities and Exchange Commission on July 12, 2013 for the fiscal year ended April 28, 2013.

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CFI Announces Results for Fourth Quarter and Fiscal 2014

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June 12, 2014

CULP, INC.

Condensed Financial Highlights

(Unaudited)

	Three Months Ended				Fiscal Year Ended
	April 27, 2014		April 28, 2013		April 27, 2014		April 28, 2013
Net sales	$	74,043,000	$	70,375,000	$	287,162,000	$	268,814,000
Income before income taxes	$	4,120,000	$	5,863,000	$	19,043,000	$	20,289,000
Net income	$	2,740,000	$	3,702,000	$	17,447,000	$	18,317,000
Net income per share:
Basic	$	0.22	$	0.31	$	1.43	$	1.50
Diluted	$	0.22	$	0.30	$	1.41	$	1.47

Adjusted net income	$	3,395,000	$	5,030,000	$	15,691,000	$	17,408,000
Adjusted net income per share
Basic	$	0.28	$	0.42	$	1.29	$	1.42
Diluted	$	0.27	$	0.41	$	1.26	$	1.40
Average shares outstanding:
Basic		12,188,000		12,102,000		12,177,000		12,235,000
Diluted		12,413,000		12,323,000		12,414,000		12,450,000

Presentation of Adjusted Net Income and Adjusted Income Taxes (1)

	Three Months Ended				Fiscal Year Ended
	April 27,		April 28,		April 27,		April 28,
	2014		2013		2014		2013
Income before income taxes	$	4,120,000	$	5,863,000	$	19,043,000	$	20,289,000
Adjusted income taxes (2)	$	725,000	$	833,000	$	3,352,000	$	2,881,000
Adjusted net income	$	3,395,000	$	5,030,000	$	15,691,000	$	17,408,000

(1)	Culp Inc. currently does not incur cash income tax expense in the U.S. due to its $45.7 million in net operating loss carryforwards. Adjusted net income is calculated using only estimated cash income tax expense for the company’s subsidiaries in Canada and China.
(2)	Represents estimated cash income tax expense for the company’s subsidiaries in Canada and China, calculated with a consolidated adjusted effective income tax rate of 17.6% for fiscal 2014 and 14.2% for fiscal 2013.

-MORE-

CFI Announces Results for Fourth Quarter and Fiscal 2014

Page 7 

June 12, 2014

Consolidated Adjusted Effective Income Tax Rate, Net Income and Earnings Per Share

For the Twelve Months Ended April 27, 2014, and April 28, 2013

(Unaudited)

(Amounts in Thousands)

		TWELVE MONTHS ENDED
		Amounts
		April 27,			April 28,
		2014			2013
Consolidated Effective GAAP Income Tax Rate	(1)		8.4	%		9.7	%
Reduction of U.S. Valuation Allowance			-			59.7	%
Undistributed earnings from foreign subsidiaries			26.3	%		(34.6	)%
Non-Cash U.S. Income Tax Expense			(17.1	)%		(19.3	)%
Non-Cash Foreign Income Tax Expense			-			(1.3	)%
Consolidated Adjusted Effective Income Tax Rate	(2)		17.6	%		14.2	%

	THREE MONTHS ENDED
	As reported					April 27, 2014		As reported					April 28, 2013
	April 27,					Proforma Net		April 28,					Proforma Net
	2014		Adjustments			of Adjustments		2013		Adjustments			of Adjustments
Income before income taxes	$	4,120	$	-		$	4,120	$	5,863				$	5,863
Income taxes (3)		1,380	$	(655	)		725		2,161	$	(1,328	)		833
Net income	$	2,740	$	655		$	3,395	$	3,702	$	1,328		$	5,030
Net income per share-basic	$	0.22	$	(0.05	)	$	0.28	$	0.31	$	(0.11	)	$	0.42
Net income per share-diluted	$	0.22	$	(0.05	)	$	0.27	$	0.30	$	(0.11	)	$	0.41
Average shares outstanding-basic		12,188		12,188			12,188		12,102		12,102			12,102
Average shares outstanding-diluted		12,413		12,413			12,413		12,323		12,323			12,323
	TWELVE MONTHS ENDED
	As reported					April 27, 2014		As reported					April 28, 2013
	April 27,					Proforma Net		April 28,					Proforma Net
	2014		Adjustments			of Adjustments		2013		Adjustments			of Adjustments
Income before income taxes	$	19,043	$	-		$	19,043	$	20,289	$	-		$	20,289
Income taxes (3)		1,596	$	1,756			3,352		1,972	$	909			2,881
Net income	$	17,447	$	(1,756	)	$	15,691	$	18,317	$	(909	)	$	17,408
Net income per share-basic	$	1.43	$	0.14		$	1.29	$	1.50	$	0.07		$	1.42
Net income per share-diluted	$	1.41	$	0.14		$	1.26	$	1.47	$	0.07		$	1.40
Average shares outstanding-basic		12,177		12,177			12,177		12,235		12,235			12,235
Average shares outstanding-diluted		12,414		12,414			12,414		12,450		12,450			12,450

(1) Calculated by dividing consolidated income tax expense by consolidated income before income taxes.

(2) Represents estimated cash income tax expense for our subsidiaries located in Canada and China divided by consolidated income before income taxes.

(3) Proforma income taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.

Reconciliation of Free Cash Flow

For the Twelve Months Ended April 27, 2014, and April 28, 2013

(Unaudited)

(Amounts in thousands)

	FY 2014			FY 2013
Net cash provided by operating activities	$	20,219		$	17,075
Minus: Capital Expenditures		(5,258	)		(4,400	)
Add: Proceeds from the sale of equipment		407			-
Add: Proceeds from life insurance polices		-			716
Minus: Payments on life insurance policies		(30	)		(19	)
Add: Excess tax benefits related to stock-based compensation		143			76
Minus: Purchase of long-term investments		(765	)		-
Effects of exchange rate changes on cash and cash equivalents		(875	)		(381	)
Free Cash Flow	$	13,841		$	13,067

-MORE-

CFI Announces Results for Fourth Quarter and Fiscal 2014

Page 8 

June 12, 2014

Reconciliation of Return on Capital

For the Twelve Months Ended April 27, 2014, and April 28, 2013

(Unaudited)

(Amounts in thousands)

	Twelve Months Ended			Twelve Months Ended
	April 27, 2014			April 28, 2013
Consolidated Income from Operations	$	20,249		$	21,085
Average Capital Employed (2)		77,159			71,623
Return on Average Capital Employed (1)		26.2	%		29.4	%
Average Capital Employed
	April 27, 2014			January 26, 2014			October 27, 2013			July 28, 2013			April 28, 2013
Total assets	$	160,935		$	156,678		$	156,242		$	151,101		$	144,706
Total liabilities		(49,191	)		(47,235	)		(54,727	)		(52,516	)		(49,123	)
Subtotal	$	111,744		$	109,443		$	101,515		$	98,585		$	95,583
Less:
Cash and cash equivalents		(29,303	)		(23,293	)		(24,267	)		(21,423	)		(23,530	)
Short-term investments		(6,294	)		(7,077	)		(6,220	)		(6,174	)		(5,286	)
Long-term investments		(765	)		-			-			-			-
Income taxes receivable		(121	)		-			-			(292	)		(318	)
Deferred income taxes - current		(6,230	)		(7,503	)		(7,745	)		(7,747	)		(7,709	)
Deferred income taxes - non-current		(2,040	)		(1,227	)		(661	)		(651	)		(753	)
Current maturities of long-term debt		2,200			2,200			2,200			2,200			2,200
Line of credit		586			573			585			560			561
Income taxes payable - current		442			130			304			320			285
Income taxes payable - long-term		3,962			3,953			4,141			4,176			4,191
Deferred income taxes - non-current		1,013			945			5,016			4,335			3,075
Long-term debt, less current maturities		2,200			2,200			2,200			4,400			4,400
Total Capital Employed	$	77,394		$	80,344		$	77,068		$	78,289		$	72,699
Average Capital Employed (2)	$	77,159
	April 28, 2013			January 27, 2013			October 28, 2012			July 29, 2012			April 29, 2012
Total assets	$	144,706		$	143,797		$	142,443		$	143,160		$	144,716
Total liabilities		(49,123	)		(51,831	)		(47,055	)		(51,329	)		(55,716	)
Subtotal	$	95,583		$	91,966		$	95,388		$	91,831		$	89,000
Less:
Cash and cash equivalents		(23,530	)		(19,489	)		(23,464	)		(21,889	)		(25,023	)
Short-term investments		(5,286	)		(5,237	)		(5,241	)		(5,200	)		(5,941	)
Deferred income taxes - current		(7,709	)		(4,098	)		(4,470	)		(2,337	)		(2,467	)
Income taxes receivable		(318	)		-			-			-			-
Deferred income taxes - non-current		(753	)		(4,172	)		(4,738	)		(2,715	)		(3,205	)
Current maturities of long-term debt		2,200			2,366			2,401			2,400			2,404
Line of credit		561			576			875			834			889
Income taxes payable - current		285			395			385			751			642
Income taxes payable - long-term		4,191			4,195			4,188			4,131			4,164
Deferred income taxes - non-current		3,075			856			856			705			705
Long-term debt, less current maturities		4,400			4,400			4,416			6,666			6,719
Total Capital Employed	$	72,699		$	71,758		$	70,596		$	75,177		$	67,887
Average Capital Employed (2)	$	71,623

Notes:

(1) Return on average capital employed represents operating income for fiscal 2014 and 2013 divided by average capital employed.

Average capital employed does not include cash and cash equivalents, short-term investments, long-term investments, long-term debt,

including current maturities, current and noncurrent deferred tax assets and liabilities, and income taxes receivable and income taxes payable.

(2) Average capital employed used for the year ended April 27, 2014 was computed using the five quarterly periods ending April 27, 2014, January 26, 2014, October 27, 2013, July 28, 2013, and April 28, 2013.

Average capital employed used for the year ended April 28, 2013 was computed using the five quarterly periods ending April 28, 2013, January 27, 2013,October 28, 2012, July 29, 2012, and April 29, 2012.

-END-

EX-99.(B)

Exhibit 99(b)

Page 1 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF NET INCOME

FOR THE THREE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

(UNAUDITED)

(Amounts in Thousands, Except for Per Share Data)

	THREE MONTHS ENDED
	Amounts									Percent of Sales
	April 27,			April 28,			% Over			April 27,			April 28,
	2014			2013			(Under)			2014			2013
Net sales	$	74,043			70,375		5.2		%	100.0		%	100.0		%
Cost of sales		62,282			57,527		8.3		%	84.1		%	81.7		%
Gross profit		11,761			12,848		(8.5	)	%	15.9		%	18.3		%
Selling, general and
administrative expenses		7,317			6,772		8.0		%	9.9		%	9.6		%
Income from operations		4,444			6,076		(26.9	)	%	6.0		%	8.6		%
Interest expense		97			140		(30.7	)	%	0.1		%	0.2		%
Interest income		(139	)		(90	)	54.4		%	(0.2	)	%	(0.1	)	%
Other expense		366			163		124.5		%	0.5		%	0.2		%
Income before income taxes		4,120			5,863		(29.7	)	%	5.6		%	8.3		%
Income taxes*		1,380			2,161		(36.1	)	%	33.5		%	36.9		%
Net income	$	2,740			3,702		(26.0	)	%	3.7		%	5.3		%
Net income per share-basic	$	0.22		$	0.31		(29.0	)	%
Net income per share-diluted	$	0.22		$	0.30		(26.7	)	%
Average shares outstanding-basic		12,188			12,102		0.7		%
Average shares outstanding-diluted		12,413			12,323		0.7		%

PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	THREE MONTHS ENDED
	Amounts							Percent of Sales
	April 27,		April 28,		% Over			April 27,		April 28,
	2014		2013		(Under)			2014		2013
Income before income taxes (see above)	$	4,120		5,863	(29.7	)	%	5.6	%	8.3	%
Adjusted Income taxes (2)*		725		833	(13.0	)	%	17.6	%	14.2	%
Adjusted net income		3,395		5,030	(32.5	)	%	4.6	%	7.1	%
Adjusted net income per share-basic	$	0.28	$	0.42	(33.3	)	%
Adjusted net income per share-diluted	$	0.27	$	0.41	(34.1	)	%
Average shares outstanding-basic		12,188		12,102	0.7		%
Average shares outstanding-diluted		12,413		12,323	0.7		%

(1) Culp, Inc. currently does not incur cash income tax expense in the U.S. due to its $45.7 million in net operating loss carryforwards. Therefore,

adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 10 of 10.

(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 10 of 10.

* Percent of sales column for income taxes is calculated as a % of income before income taxes.

Exhibit 99(b)

Page 2 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF NET INCOME

FOR THE TWELVE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

(UNAUDITED)

(Amounts in Thousands, Except for Per Share Data)

	TWELVE MONTHS ENDED
	Amounts									Percent of Sales
	April 27,			April 28,			% Over			April 27,			April 28,
	2014			2013			(Under)			2014			2013
Net sales	$	287,162			268,814		6.8		%	100.0		%	100.0		%
Cost of sales		238,256			219,284		8.7		%	83.0		%	81.6		%
Gross profit		48,906			49,530		(1.3	)	%	17.0		%	18.4		%
Selling, general and
administrative expenses		28,657			28,445		0.7		%	10.0		%	10.6		%
Income from operations		20,249			21,085		(4.0	)	%	7.1		%	7.8		%
Interest expense		427			632		(32.4	)	%	0.1		%	0.2		%
Interest income		(482	)		(419	)	15.0		%	(0.2	)	%	(0.2	)	%
Other expense		1,261			583		116.3		%	0.4		%	0.2		%
Income before income taxes		19,043			20,289		(6.1	)	%	6.6		%	7.5		%
Income taxes*		1,596			1,972		(19.1	)	%	8.4		%	9.7		%
Net income	$	17,447			18,317		(4.7	)	%	6.1		%	6.8		%
Net income per share-basic	$	1.43		$	1.50		(4.7	)	%
Net income per share-diluted	$	1.41		$	1.47		(4.1	)	%
Average shares outstanding-basic		12,177			12,235		(0.5	)	%
Average shares outstanding-diluted		12,414			12,450		(0.3	)	%
PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	TWELVE MONTHS ENDED
	Amounts									Percent of Sales
	April 27,			April 28,			% Over			April 27,			April 28,
	2014			2013			(Under)			2014			2013
Income before income taxes (see above)	$	19,043			20,289		(6.1	)	%	6.6		%	7.5		%
Adjusted Income taxes (2)*		3,352			2,881		16.3		%	17.6		%	14.2		%
Adjusted net income		15,691			17,408		(9.9	)	%	5.5		%	6.5		%
Adjusted net income per share-basic	$	1.29		$	1.42		(9.2	)	%
Adjusted net income per share-diluted	$	1.26		$	1.40		(10.0	)	%
Average shares outstanding-basic		12,177			12,235		(0.5	)	%
Average shares outstanding-diluted		12,414			12,450		(0.3	)	%

(1) Culp, Inc. currently does not incur cash income tax expense in the U.S. due to its $45.7 million in net operating loss carryforwards.  Therefore,

adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China.  See reconciliation on page 10 of 10.

(2) Represents estimated income tax expense for our subsidiaries located in Canada and China.  See reconciliation on page 10 of 10.

 * Percent of sales column for income taxes is calculated as a % of income before income taxes.

Exhibit 99(b)

Page 3 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED BALANCE SHEETS

APRIL 27, 2014 AND April 28, 2013

Unaudited

(Amounts in Thousands)

	Amounts				Increase
	April 27,		* April 28,		(Decrease)
	2014		2013		Dollars			Percent
Current assets
Cash and cash equivalents	$	29,303	$	23,530		5,773			24.5		%
Short-term investments		6,294		5,286		1,008			19.1		%
Accounts receivable		27,409		23,392		4,017			17.2		%
Inventories		40,674		38,418		2,256			5.9		%
Deferred income taxes		6,230		7,709		(1,479	)		(19.2	)	%
Income taxes receivable		121		318		(197	)		(61.9	)	%
Other current assets		2,344		2,093		251			12.0		%
Total current assets		112,375		100,746		11,629			11.5		%
Property, plant and equipment, net		31,376		30,594		782			2.6		%
Goodwill		11,462		11,462		-			0.0		%
Deferred income taxes		2,040		753		1,287			170.9		%
Long-term investments		765		-		765			100.0		%
Other assets		2,917		1,151		1,766			153.4		%
Total assets	$	160,935	$	144,706		16,229			11.2		%
Current liabilities
Current maturities of long-term debt	$	2,200	$	2,200		-			0.0		%
Line of credit		-		561		(561	)		(100.0	)	%
Accounts payable - trade		26,686		22,357		4,329			19.4		%
Accounts payable - capital expenditures		277		225		52			23.1		%
Accrued expenses		9,181		11,829		(2,648	)		(22.4	)	%
Income taxes payable - current		442		285		157			55.1		%
Total current liabilities		38,786		37,457		1,329			3.5		%
Income taxes payable - long-term		3,962		4,191		(229	)		(5.5	)	%
Deferred income taxes		1,013		3,075		(2,062	)		(67.1	)	%
Line of credit		586		-		586			100.0		%
Deferred compensation		2,644		-		2,644			100.0		%
Long-term debt, less current maturities		2,200		4,400		(2,200	)		(50.0	)	%
Total liabilities		49,191		49,123		68			0.1		%
Shareholders' equity		111,744		95,583		16,161			16.9		%
Total liabilities and shareholders' equity	$	160,935	$	144,706		16,229			11.2		%
Shares outstanding		12,250		12,225		25			0.2		%
* Derived from audited financial statements

Exhibit 99(b)

Page 4 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

      CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE TWELVE  MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

Unaudited

(Amounts in Thousands)

	TWELVE MONTHS ENDED
	Amounts
	April 27,			April 28,
	2014			2013
Cash flows from operating activities:
Net income	$	17,447		$	18,317
Adjustments to reconcile net income  to net cash
provided by operating activities:
Depreciation		5,312			5,115
Amortization of other assets		169			235
Stock-based compensation		710			562
Excess tax benefit related to stock-based compensation		(143	)		(76	)
Deferred income taxes		(1,727	)		(344	)
Gain on sale of equipment		(283	)		-
Foreign currency exchange losses		626			222
Changes in assets and liabilities, net of effects of acquisition of assets:
Accounts receivable		(3,857	)		1,667
Inventories		(2,200	)		(1,979	)
Other current assets		(270	)		(49	)
Other assets		(72	)		(176	)
Accounts payable-trade		4,131			(8,384	)
Accrued expenses and deferred compensation		34			2,531
Accrued restructuring		-			(40	)
Income taxes		342			(526	)
Net cash provided by operating activities		20,219			17,075
Cash flows from investing activities:
Capital expenditures		(5,258	)		(4,400	)
Net cash paid for acquisition of assets		(2,640	)		-
Proceeds from the sale of equipment		407			-
Proceeds from life insurance policies		-			716
Payments on life insurance policies		(30	)		(19	)
Purchase of short-term investments		(1,945	)		(105	)
Purchase of long-term investments		(765	)		-
Proceeds from the sale of short-term investments		810			795
Net cash used in investing activities		(9,421	)		(3,013	)
Cash flows from financing activities:
Proceeds from lines of credit		-			1,000
Payments on lines of credit		-			(1,325	)
Payments on long-term debt		(2,200	)		(2,515	)
Proceeds from common stock issued		194			205
Common stock shares repurchased		-			(5,022	)
Dividends paid		(2,204	)		(7,593	)
Debt issance costs		(83	)		-
Excess tax benefit related to stock-based compensation		143			76
Net cash used in financing activities		(4,150	)		(15,174	)
Effect of exchange rate changes on cash and cash equivalents		(875	)		(381	)
Increase (decrease) in cash and cash equivalents		5,773			(1,493	)
Cash and cash equivalents at beginning of period		23,530			25,023
Cash and cash equivalents at end of period	$	29,303		$	23,530
Free Cash Flow (1)	$	13,841		$	13,067

(1)		Free Cash Flow reconciliation is as follows:
			FY 2014			FY 2013
A	)	Net cash provided by operating activities	$	20,219		$	17,075
B	)	Minus:  Capital Expenditures		(5,258	)		(4,400	)
C	)	Add: Proceeds from the sale of equipment		407			-
D	)	Add: Proceeds from life insurance policies		-			716
E	)	Minus: Payments on life insurance policies		(30	)		(19	)
F	)	Add: Excess tax benefit related to stock-based compensation		143			76
G	)	Minus: Purchase of long-term investments		(765	)		-
H	)	Effect of exchange rate changes on cash and cash equivalents		(875	)		(381	)
			$	13,841		$	13,067

Exhibit 99(b)

Page 5 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

STATEMENTS OF OPERATIONS BY SEGMENT

           FOR THE THREE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

        (Unaudited)

           (Amounts in thousands)

	THREE MONTHS ENDED
	Amounts									Percent of Total Sales
	April 27,			April 28,			% Over			April 27,			April 28,
Net Sales by Segment	2014			2013			(Under)			2014			2013
Mattress Fabrics	$	43,669			40,839		6.9		%	59.0		%	58.0		%
Upholstery Fabrics		30,374			29,536		2.8		%	41.0		%	42.0		%
Net Sales	$	74,043			70,375		5.2		%	100.0		%	100.0		%
Gross Profit by Segment										Gross Profit Margin
Mattress Fabrics	$	7,165			7,837		(8.6	)	%	16.4		%	19.2		%
Upholstery Fabrics		4,596			5,011		(8.3	)	%	15.1		%	17.0		%
Gross Profit	$	11,761			12,848		(8.5	)	%	15.9		%	18.3		%
Selling, General and Administrative Expenses by Segment										Percent of Sales
Mattress Fabrics	$	2,683			2,449		9.6		%	6.1		%	6.0		%
Upholstery Fabrics		3,385			3,173		6.7		%	11.1		%	10.7		%
Unallocated Corporate expenses		1,249			1,150		8.6		%	1.7		%	1.6		%
Selling, General and Administrative Expenses	$	7,317			6,772		8.0		%	9.9		%	9.6		%
Operating Income (loss) by Segment										Operating Income (Loss) Margin
Mattress Fabrics	$	4,482			5,388		(16.8	)	%	10.3		%	13.2		%
Upholstery Fabrics		1,211			1,838		(34.1	)	%	4.0		%	6.2		%
Unallocated corporate expenses		(1,249	)		(1,150	)	8.6		%	(1.7	)	%	(1.6	)	%
Operating income	$	4,444			6,076		(26.9	)	%	6.0		%	8.6		%
Depreciation by Segment
Mattress Fabrics	$	1,184			1,143		3.6		%
Upholstery Fabrics		164			154		6.5		%
Depreciation	$	1,348			1,297		3.9		%

Exhibit 99(b)

Page 6 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

STATEMENTS OF OPERATIONS BY SEGMENT

FOR THE TWELVE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

(Unaudited)

(Amounts in thousands)

	TWELVE MONTHS ENDED
	Amounts										Percent of Total Sales
	April 27,			April 28,			% Over				April 27,				April 28,
Net Sales by Segment	2014			2013			(Under)				2014				2013
Mattress Fabrics	$	160,705			154,014			4.3		%		56.0		%		57.3		%
Upholstery Fabrics		126,457			114,800			10.2		%		44.0		%		42.7		%
Net Sales	$	287,162			268,814			6.8		%		100.0		%		100.0		%
Gross Profit by Segment											Gross Profit Margin
Mattress Fabrics	$	27,477			29,546			(7.0	)	%		17.1		%		19.2		%
Upholstery Fabrics		21,429			19,984			7.2		%		16.9		%		17.4		%
Gross Profit	$	48,906			49,530			(1.3	)	%		17.0		%		18.4		%
Selling, General and Administrative Expenses  by Segment											Percent of Sales
Mattress Fabrics	$	9,962			9,646			3.3		%		6.2		%		6.3		%
Upholstery Fabrics		13,393			13,031			2.8		%		10.6		%		11.4		%
Unallocated Corporate expenses		5,302			5,768			(8.1	)	%		1.8		%		2.1		%
Selling, General, and Administrative Expenses	$	28,657			28,445			0.7		%		10.0		%		10.6		%
Operating Income (loss)  by Segment											Operating Income (Loss) Margin
Mattress Fabrics	$	17,515			19,900			(12.0	)	%		10.9		%		12.9		%
Upholstery Fabrics		8,036			6,953			15.6		%		6.4		%		6.1		%
Unallocated corporate expenses		(5,302	)		(5,768	)		(8.1	)	%		(1.8	)	%		(2.1	)	%
Operating income	$	20,249			21,085			(4.0	)	%		7.1		%		7.8		%
Return on Capital (1)
Mattress Fabrics		29.3	%		35.6	%
Upholstery Fabrics		40.7	%		40.4	%
Unallocated Corporate		N/A			N/A
Consolidated		26.2	%		29.4	%
Capital Employed (2)
Mattress Fabrics		62,457			57,950			7.8		%
Upholstery Fabrics		17,419			17,313			0.6		%
Unallocated Corporate		(2,482	)		(2,564	)		N/A
Consolidated		77,394			72,699			6.5		%
Depreciation by Segment
Mattress Fabrics	$	4,694			4,487			4.6		%
Upholstery Fabrics		618			628			(1.6	)	%
Depreciation	$	5,312			5,115			3.9		%
Notes:
(1) See pages 8 and 9 of this financial information release for calculations.
(2) The capital employed balances are as of April 27, 2014 and April 28, 2013.

Exhibit 99(b)

Page 7 of 10

CULP, INC.  FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF ADJUSTED EBITDA

FOR THE TWELVE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

(UNAUDITED)

(AMOUNTS IN THOUSANDS)

	Quarter Ended
												Trailing 12
												Months
	7/28/2013		10/27/2013			1/26/2014			4/27/2014			4/27/2014
Net income	$	3,230	$	3,096		$	8,381		$	2,740		$	17,447
Income taxes		2,305		1,718			(3,807	)		1,380			1,596
Interest expense (income), net		48		(3	)		(57	)		(43	)		(55	)
Depreciation and amortization expense		1,344		1,373			1,370			1,394			5,481
Stock based compensation		152		224			175			159			710
Adjusted EBITDA	$	7,079	$	6,408		$	6,062		$	5,630		$	25,179
	Quarter Ended
												Trailing 12
												Months
	7/29/2012			10/28/2012		1/27/2013			4/28/2013			4/28/2013
Net income	$	3,524	$	8,268		$	2,823		$	3,702		$	18,317
Income taxes		1,848		(3,736	)		1,700			2,160			1,972
Interest expense, net		63		60			40			50			213
Depreciation and amortization expense		1,314		1,344			1,338			1,354			5,350
Stock based compensation		70		127			111			254			562
Adjusted EBITDA	$	6,819	$	6,063		$	6,012		$	7,520		$	26,414

Exhibit 99(b)

Page 8 of 10

	CULP, INC. FINANCIAL INFORMATION RELEASE
	RETURN ON CAPITAL EMPLOYED BY SEGMENT
	FOR THE TWELVE MONTHS ENDED APRIL 27, 2014
	(Amounts in Thousands)
	(Unaudited)
	Operating Income
	Twelve Months			Average			Return on
	Ended			Capital			Avg. Capital
	April 27, 2014 (1)			Employed (3)			Employed (2)
Mattress Fabrics	$	17,515		$	59,728			29.3	%
Upholstery Fabrics		8,036			19,760			40.7	%
(less: Unallocated Corporate)		(5,302	)		(2,329	)		N/A
Total	$	20,249		$	77,159			26.2	%

Average Capital Employed	As of the three Months Ended April 27, 2014												As of the three Months Ended January 26, 2014												As of the three Months Ended October 27, 2013
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		79,055			34,987			46,893			160,935			78,503			37,147			41,028			156,678			79,444			35,881			40,917			156,242
Total liabilities		(16,598	)		(17,568	)		(15,025	)		(49,191	)		(18,804	)		(13,589	)		(14,842	)		(47,235	)		(20,500	)		(15,581	)		(18,646	)		(54,727	)
Subtotal	$	62,457		$	17,419		$	31,868		$	111,744		$	59,699		$	23,558		$	26,186		$	109,443		$	58,944		$	20,300		$	22,271		$	101,515
Less:
Cash and cash equivalents		-			-			(29,303	)		(29,303	)		-			-			(23,293	)		(23,293	)		-			-			(24,267	)		(24,267	)
Short-term investments		-			-			(6,294	)		(6,294	)		-			-			(7,077	)		(7,077	)		-			-			(6,220	)		(6,220	)
Long-term investments		-			-			(765	)		(765	)		-			-			-			-			-			-			-			-
Income taxes receivable		-			-			(121	)		(121	)		-			-			-			-			-			-			-			-
Deferred income taxes - current		-			-			(6,230	)		(6,230	)		-			-			(7,503	)		(7,503	)		-			-			(7,745	)		(7,745	)
Deferred income taxes - non-current		-			-			(2,040	)		(2,040	)		-			-			(1,227	)		(1,227	)		-			-			(661	)		(661	)
Current maturities of long-term debt		-			-			2,200			2,200			-			-			2,200			2,200			-			-			2,200			2,200
Line of credit		-			-			586			586			-			-			573			573			-			-			585			585
Income taxes payable - current		-			-			442			442			-			-			130			130			-			-			304			304
Income taxes payable - long-term		-			-			3,962			3,962			-			-			3,953			3,953			-			-			4,141			4,141
Deferred income taxes - non-current		-			-			1,013			1,013			-			-			945			945			-			-			5,016			5,016
Long-term debt, less current maturities		-			-			2,200			2,200			-			-			2,200			2,200			-			-			2,200			2,200
Total Capital Employed	$	62,457		$	17,419		$	(2,482	)	$	77,394		$	59,699		$	23,558		$	(2,913	)	$	80,344		$	58,944		$	20,300		$	(2,176	)	$	77,068
	As of the three Months Ended July 28, 2013												As of the three Months Ended April 28, 2013
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		78,217			34,381			38,503			151,101			73,954			30,995			39,757			144,706
Total liabilities		(18,627	)		(14,172	)		(19,717	)		(52,516	)		(16,004	)		(13,682	)		(19,437	)		(49,123	)
Subtotal	$	59,590		$	20,209		$	18,786		$	98,585		$	57,950		$	17,313		$	20,320		$	95,583
Less:
Cash and cash equivalents		-			-			(21,423	)		(21,423	)		-			-			(23,530	)		(23,530	)
Short-term investments		-			-			(6,174	)		(6,174	)		-			-			(5,286	)		(5,286	)
Long-term investments		-			-			-			-			-			-			-			-
Income taxes receivable		-			-			(292	)		(292	)		-			-			(318	)		(318	)
Deferred income taxes - current		-			-			(7,747	)		(7,747	)		-			-			(7,709	)		(7,709	)
Deferred income taxes - non-current		-			-			(651	)		(651	)		-			-			(753	)		(753	)
Current maturities of long-term debt		-			-			2,200			2,200			-			-			2,200			2,200
Line of credit		-			-			560			560									561			561
Income taxes payable - current		-			-			320			320			-			-			285			285
Income taxes payable - long-term		-			-			4,176			4,176			-			-			4,191			4,191
Deferred income taxes - non-current		-			-			4,335			4,335			-			-			3,075			3,075
Long-term debt, less current maturities		-			-			4,400			4,400			-			-			4,400			4,400
Total Capital Employed	$	59,590		$	20,209		$	(1,510	)	$	78,289		$	57,950		$	17,313		$	(2,564	)	$	72,699
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	59,728		$	19,760		$	(2,329	)	$	77,159
Notes:
(1) See reconciliation per page 6 of this financial information release.
(2) Return on average capital employed represents operating income for fiscal 2014 divided by average capital employed.
Average capital employed does not include cash and cash equivalents, short-term investments, long-term investments, long-term debt,
including current maturities, line of credit, current and noncurrent deferred tax assets and liabilities, income taxes payable and income taxes receivable.
(3) Average capital employed was computed using the five periods ending April 27, 2014, January 26, 2014, October 27, 2013, July 28, 2013 and April 28, 2013.

Exhibit 99(b)

Page 9 of 10

	CULP, INC. FINANCIAL INFORMATION RELEASE
	RETURN ON CAPITAL EMPLOYED BY SEGMENT
	FOR THE TWELVE MONTHS ENDED APRIL 28, 2013
	(Amounts in Thousands)
	(Unaudited)
	Operating Income
	Twelve Months			Average			Return on
	Ended			Capital			Avg. Capital
	April 28, 2013 (1)			Employed (3)			Employed (2)
Mattress Fabrics	$	19,900		$	55,947			35.6	%
Upholstery Fabrics		6,953			17,200			40.4	%
(less: Unallocated Corporate)		(5,768	)		(1,524	)		N/A
Total	$	21,085		$	71,623			29.4	%

Average Capital Employed	As of the three Months Ended April 28, 2013												As of the three Months Ended January 27, 2013												As of the three Months Ended October 28, 2012
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		73,954			30,995			39,757			144,706			74,794			33,773			35,230			143,797			74,342			27,240			40,861			142,443
Total liabilities		(16,004	)		(13,682	)		(19,437	)		(49,123	)		(18,824	)		(15,299	)		(17,708	)		(51,831	)		(19,240	)		(10,512	)		(17,303	)		(47,055	)
Subtotal	$	57,950		$	17,313		$	20,320		$	95,583		$	55,970		$	18,474		$	17,522		$	91,966		$	55,102		$	16,728		$	23,558		$	95,388
Less:
Cash and cash equivalents		-			-			(23,530	)		(23,530	)		-			-			(19,489	)		(19,489	)		-			-			(23,464	)		(23,464	)
Short-term investments		-			-			(5,286	)		(5,286	)		-			-			(5,237	)		(5,237	)		-			-			(5,241	)		(5,241	)
Deferred income taxes - current		-			-			(7,709	)		(7,709	)		-			-			(4,098	)		(4,098	)		-			-			(4,470	)		(4,470	)
Income taxes receivable		-			-			(318	)		(318	)		-			-			-			-			-			-			-			-
Deferred income taxes - non-current		-			-			(753	)		(753	)		-			-			(4,172	)		(4,172	)		-			-			(4,738	)		(4,738	)
Current maturities of long-term debt		-			-			2,200			2,200			-			-			2,366			2,366			-			-			2,401			2,401
Line of credit		-			-			561			561			-			-			576			576			-			-			875			875
Income taxes payable - current		-			-			285			285			-			-			395			395			-			-			385			385
Income taxes payable - long-term		-			-			4,191			4,191			-			-			4,195			4,195			-			-			4,188			4,188
Deferred income taxes - non-current		-			-			3,075			3,075			-			-			856			856			-			-			856			856
Long-term debt, less current maturities		-			-			4,400			4,400			-			-			4,400			4,400			-			-			4,416			4,416
Total Capital Employed	$	57,950		$	17,313		$	(2,564	)	$	72,699		$	55,970		$	18,474		$	(2,686	)	$	71,758		$	55,102		$	16,728		$	(1,234	)	$	70,596
	As of the three Months Ended July 29, 2012												As of the three Months Ended April 29, 2012
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		78,098			29,973			35,089			143,160			71,563			33,641			39,512			144,716
Total liabilities		(21,295	)		(11,006	)		(19,028	)		(51,329	)		(17,653	)		(19,123	)		(18,940	)		(55,716	)
Subtotal	$	56,803		$	18,967		$	16,061		$	91,831		$	53,910		$	14,518		$	20,572		$	89,000
Less:
Cash and cash equivalents		-			-			(21,889	)		(21,889	)		-			-			(25,023	)		(25,023	)
Short-term investments		-			-			(5,200	)		(5,200	)								(5,941	)		(5,941	)
Deferred income taxes - current		-			-			(2,337	)		(2,337	)		-			-			(2,467	)		(2,467	)
Deferred income taxes - non-current		-			-			(2,715	)		(2,715	)		-			-			(3,205	)		(3,205	)
Current maturities of long-term debt		-			-			2,400			2,400			-			-			2,404			2,404
Line of credit		-			-			834			834			-			-			889			889
Income taxes payable - current		-			-			751			751			-			-			642			642
Income taxes payable - long-term		-			-			4,131			4,131			-			-			4,164			4,164
Deferred income taxes - non-current		-			-			705			705			-			-			705			705
Long-term debt, less current maturities		-			-			6,666			6,666			-			-			6,719			6,719
Total Capital Employed	$	56,803		$	18,967		$	(593	)	$	75,177		$	53,910		$	14,518		$	(541	)	$	67,887
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	55,947		$	17,200		$	(1,524	)	$	71,623
Notes:
(1) Operating income excludes restructuring and related charges--see reconciliation per page 6 of this financial information release.
(2) Return on average capital employed represents operating income for fiscal 2013 divided by average capital employed.
Average capital employed does not include cash and cash equivalents, short-term investments, long-term debt, including current maturities,
line of credit, current and noncurrent deferred tax assets and liabilities, income taxes payable, and income taxes receivable.
(3) Average capital employed was computed using the five periods ending April 28, 2013, January 27, 2013, October 28, 2012, July 29, 2012, and April 29, 2012.

Exhibit 99(b)

Page 10 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED ADJUSTED EFFECTIVE INCOME TAX RATE, NET INCOME AND EARNINGS PER SHARE

FOR THE TWELVE MONTHS ENDED APRIL 27, 2014 AND APRIL 28, 2013

Unaudited

(Amounts in Thousands)

		TWELVE MONTHS ENDED
		Amounts
		April 27,		April 28,
		2014		2013
Consolidated Effective GAAP Income Tax Rate	(1)	8.4	%	9.7	%
Reduction of U.S. Valuation Allowance		-		59.7	%
Undistributed earnings from foreign subsidiaries		26.3	%	(34.6)	%
Non-Cash U.S. Income Tax Expense		(17.1)	%	(19.3)	%
Non-Cash Foreign Income Tax Expense		-		(1.3)	%
Consolidated Adjusted Effective Income Tax Rate	(2)	17.6	%	14.2	%

	THREE MONTHS ENDED
	As reported					April 27, 2014		As reported					April 28, 2013
	April 27,					Proforma Net		April 28,					Proforma Net
	2014		Adjustments			of Adjustments		2013		Adjustments			of Adjustments
Income before income taxes	$	4,120	$	-		$	4,120	$	5,863				$	5,863
Income taxes (3)		1,380	$	(655	)		725		2,161	$	(1,328	)		833
Net income	$	2,740	$	655		$	3,395	$	3,702	$	1,328		$	5,030
Net income per share-basic	$	0.22	$	(0.05	)	$	0.28	$	0.31	$	(0.11	)	$	0.42
Net income per share-diluted	$	0.22	$	(0.05	)	$	0.27	$	0.30	$	(0.11	)	$	0.41
Average shares outstanding-basic		12,188		12,188			12,188		12,102		12,102			12,102
Average shares outstanding-diluted		12,413		12,413			12,413		12,323		12,323			12,323
	TWELVE MONTHS ENDED
	As reported					April 27, 2014		As reported					April 28, 2013
	April 27,					Proforma Net		April 28,					Proforma Net
		2014	Adjustments			of Adjustments			2013	Adjustments			of Adjustments
Income before income taxes	$	19,043	$	-		$	19,043	$	20,289	$	-		$	20,289
Income taxes (3)		1,596	$	1,756			3,352		1,972	$	909			2,881
Net income	$	17,447	$	(1,756	)	$	15,691	$	18,317	$	(909	)	$	17,408
Net income per share-basic	$	1.43	$	0.14		$	1.29	$	1.50	$	0.07		$	1.42
Net income per share-diluted	$	1.41	$	0.14		$	1.26	$	1.47	$	0.07		$	1.40
Average shares outstanding-basic		12,177		12,177			12,177		12,235		12,235			12,235
Average shares outstanding-diluted		12,414		12,414			12,414		12,450		12,450			12,450
(1) Calculated by dividing consolidated income tax expense by
consolidated income before income taxes.
(2) Represents estimated cash income tax expense for our subsidiaries located
in Canada and China divided by consolidated income before income taxes.
(3) Proforma income taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.