North Carolina
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1-12597
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56-1001967
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.)
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1823 Eastchester Drive
High Point, North Carolina 27265 |
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(Address of Principal Executive Offices)
(Zip Code)
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(336) 889-5161
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(Registrant’s Telephone Number, Including Area Code)
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Not Applicable
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(Former name or address, if changed from last report)
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Page
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Item 2.02 – Results of Operations and Financial Condition
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3
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Item 9.01(d) - Exhibits
|
5
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Signature | 6 |
Exhibits
|
7 |
|
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: September 2, 2015
|
Exhibit Number | Exhibit | |
99(a) | News Release dated September 2, 2015 | |
99(b) | Financial Information Release dated September 2, 2015 |
Investor Contact: | Kenneth R. Bowling | Media Contact: | Teresa A. Huffman |
Chief Financial Officer | Vice President, Human Resources | ||
336-881-5630 | 336-889-5161 |
■
|
Net sales were $80.2 million, up 5.4 percent, with mattress fabrics sales up 11.6 percent and upholstery fabrics sales down 2.6 percent. The first quarter of fiscal 2016 had 13 weeks compared with 14 weeks for the first quarter of fiscal 2015.
|
■
|
Pre-tax income was $7.4 million, compared with $5.5 million for the prior year period.
|
■
|
Adjusted net income (non-GAAP) was $6.2 million, or $0.50 per diluted share, for the current quarter, compared with $4.5 million, or $0.37 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 $4.7 million, or $0.38 per diluted share, compared with net income of $3.3 million, or $0.27 per diluted share, in the prior year period.
|
■
|
The company’s financial position remained strong with cash and cash equivalents and short term investments of $32.3 million and total debt of $2.2 million as of August 2, 2015. Following the end of the first quarter, the company paid the final installment on its term loan with no remaining debt on the balance sheet at this time.
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■
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Consolidated return on capital was 34 percent compared with 26 percent in the prior year period.
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■
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The company paid a cash dividend of $0.06 per share and a special cash dividend of $0.40 per share during the quarter, totaling $5.7 million. Since June 2011, the company has returned a total of $35.0 million to shareholders in the form of regular quarterly and special dividends and share repurchases.
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■
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The projection for the second quarter of fiscal 2016 is for overall sales to be in the range of three percent to six percent higher as compared with the same period last year. Pre-tax income is expected to be in the range of $5.5 million to $6.0 million. Pre-tax income for the second quarter of fiscal 2015 was $4.9 million.
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■
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The company expects fiscal 2016 to be a good year for free cash flow even after the planned $8.0 to $9.0 million in capital expenditures.
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Three Months Ended
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||||||||
August 2,
|
August 3,
|
|||||||
2015 | 2014 | |||||||
Net sales
|
$ | 80,185,000 | $ | 76,060,000 | ||||
Income before income taxes
|
$ | 7,408,000 | $ | 5,459,000 | ||||
Net income
|
$ | 4,701,000 | $ | 3,344,000 | ||||
Net income per share:
|
||||||||
Basic
|
$ | 0.38 | $ | 0.27 | ||||
Diluted
|
$ | 0.38 | $ | 0.27 |
Adjusted net income
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$ | 6,245,000 | $ | 4,547,000 | ||||
Adjusted net income per share
|
||||||||
Basic
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$ | 0.51 | $ | 0.37 | ||||
Diluted
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$ | 0.50 | $ | 0.37 |
Average shares outstanding: | ||||||||
Basic
|
12,277,000 | 12,212,000 | ||||||
Diluted
|
12,456,000 | 12,404,000 |
Three Months Ended
|
||||||||
August 2,
|
August 3,
|
|||||||
2015 | 2014 | |||||||
Income before income taxes
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$ | 7,408,000 | $ | 5,459,000 | ||||
Adjusted income taxes (2)
|
$ | 1,163,000 | $ | 912,000 | ||||
Adjusted net income
|
$ | 6,245,000 | $ | 4,547,000 |
(1)
|
Culp, Inc. currently does not incur cash income tax expense in the U.S. due to its $32 million in net operating loss carryforwards as of May 3, 2015. Therefore, adjusted net income is calculated using only income tax expense for the company’s subsidiaries in Canada and China.
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(2)
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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 15.7% for fiscal 2016 and 16.7% for fiscal 2015.
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THREE MONTHS ENDED
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|||||||||||||
Amounts | |||||||||||||
August 2,
|
August 3,
|
||||||||||||
2015
|
2014
|
||||||||||||
Consolidated Effective GAAP Income Tax Rate
|
(1) | 36.5 | % | 38.7 | % | ||||||||
Non-Cash U.S. Income Tax Expense
|
(20.5 | )% | (21.2 | )% | |||||||||
Non-Cash Foreign Income Tax Expense
|
(0.3 | )% | (0.8 | )% | |||||||||
Consolidated Adjusted Effective Income Tax Rate
|
(2) | 15.7 | % | 16.7 | % |
THREE MONTHS ENDED | ||||||||||||||||||||||||
As reported
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As Adjusted
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As reported
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As Adjusted
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|||||||||||||||||||||
August 2,
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August 2,
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August 3,
|
August 3,
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|||||||||||||||||||||
2015
|
Adjustments
|
2015
|
2014
|
Adjustments
|
2014
|
|||||||||||||||||||
Income before income taxes
|
$ | 7,408 | $ | 7,408 | $ | 5,459 | $ | 5,459 | ||||||||||||||||
Income taxes (3)
|
2,707 | $ | (1,544 | ) | 1,163 | 2,115 | $ | (1,203 | ) | 912 | ||||||||||||||
Net income
|
$ | 4,701 | $ | 1,544 | $ | 6,245 | $ | 3,344 | $ | 1,203 | $ | 4,547 | ||||||||||||
Net income per share-basic
|
$ | 0.38 | $ | 0.13 | $ | 0.51 | $ | 0.27 | $ | 0.10 | $ | 0.37 | ||||||||||||
Net income per share-diluted
|
$ | 0.38 | $ | 0.12 | $ | 0.50 | $ | 0.27 | $ | 0.10 | $ | 0.37 | ||||||||||||
Average shares outstanding-basic
|
12,277 | 12,277 | 12,277 | 12,212 | 12,212 | 12,212 | ||||||||||||||||||
Average shares outstanding-diluted
|
12,456 | 12,456 | 12,456 | 12,404 | 12,404 | 12,404 |
(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.
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(3) |
Adjusted income taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.
|
Free Cash Flow Reconciliation
|
||||||||||||||||
Three Months Ended
|
Three Months Ended
|
|||||||||||||||
August 2, 2015
|
August 3, 2014
|
|||||||||||||||
Net cash provided by operating activities
|
$ | 1,055 | $ | 4,051 | ||||||||||||
Minus: Capital Expenditures
|
(3,336 | ) | (2,333 | ) | ||||||||||||
Add: Proceeds from the sale of equipment
|
104 | 391 | ||||||||||||||
Add: Excess tax benefits related to stock-based compensation
|
788 | 99 | ||||||||||||||
Minus: Purchase of long-term investments
|
(478 | ) | (984 | ) | ||||||||||||
Effects of exchange rate changes on cash and cash equivalents
|
116 | 223 | ||||||||||||||
Free Cash Flow
|
$ | (1,751 | ) | $ | 1,447 | |||||||||||
Return on Capital Reconciliation
|
||||||||||||||||
Three Months Ended
|
Three Months Ended
|
|||||||||||||||
August 2, 2015
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August 3, 2014
|
|||||||||||||||
Consolidated Income from Operations
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$ | 7,461 | $ | 5,296 | ||||||||||||
Average Capital Employed (2)
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86,909 | 81,593 | ||||||||||||||
Return on Average Capital Employed (1)
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34.3 | % | 26.0 | % | ||||||||||||
Average Capital Employed
|
||||||||||||||||
August 2, 2015
|
May 3, 2015
|
August 3, 2014
|
April 27, 2014
|
|||||||||||||
Total assets
|
$ | 169,872 | $ | 171,368 | $ | 154,212 | $ | 160,935 | ||||||||
Total liabilities
|
(51,147 | ) | (51,941 | ) | (45,065 | ) | (49,191 | ) | ||||||||
Subtotal
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$ | 118,725 | $ | 119,427 | $ | 109,147 | $ | 111,744 | ||||||||
Less:
|
||||||||||||||||
Cash and cash equivalents
|
(25,933 | ) | (29,725 | ) | (24,665 | ) | (29,303 | ) | ||||||||
Short-term investments
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(6,336 | ) | (10,004 | ) | (6,311 | ) | (6,294 | ) | ||||||||
Long-term investments
|
(2,893 | ) | (2,415 | ) | (1,749 | ) | (765 | ) | ||||||||
Income taxes receivable
|
(142 | ) | (229 | ) | (136 | ) | (121 | ) | ||||||||
Deferred income taxes - current
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(6,986 | ) | (4,790 | ) | (6,203 | ) | (6,230 | ) | ||||||||
Deferred income taxes - non-current
|
(412 | ) | (447 | ) | (973 | ) | (2,040 | ) | ||||||||
Current maturities of long-term debt
|
2,200 | 2,200 | 2,200 | 2,200 | ||||||||||||
Line of credit
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- | - | 569 | 586 | ||||||||||||
Income taxes payable - current
|
392 | 325 | 387 | 442 | ||||||||||||
Income taxes payable - long-term
|
3,634 | 3,792 | 4,037 | 3,962 | ||||||||||||
Deferred income taxes - non-current
|
4,064 | 1,050 | 1,013 | 1,013 | ||||||||||||
Deferred compensation
|
4,280 | 4,041 | 3,632 | 2,644 | ||||||||||||
Long-term debt, less current maturities
|
- | - | 2,200 | 2,200 | ||||||||||||
Total Capital Employed
|
$ | 90,593 | $ | 83,225 | $ | 83,148 | $ | 80,038 | ||||||||
Average Capital Employed (2)
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$ | 86,909 | $ | 81,593 | ||||||||||||
Notes:
|
(1) |
Return on average capital employed represents operating income for the three month period ending August 2, 2015, or August 3, 2014, times four quarters to arrive at an annualized value then 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 receivable and payable, and deferred compensation.
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|
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(2) |
Average capital employed used for the three months ending August 2, 2015, was computed using the two quarterly periods ending August 2, 2015, and May 3, 2015. Average capital employed used for the three months ending August 3, 2014, was computed using the two quarterly periods ending August 3, 2014, and April 27,2014.
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CULP, INC. FINANCIAL INFORMATION RELEASE
|
||||||||||||||||||||
CONSOLIDATED STATEMENTS OF NET INCOME
|
||||||||||||||||||||
FOR THE THREE MONTHS ENDED AUGUST 2, 2015, AND AUGUST 3, 2014
|
||||||||||||||||||||
(UNAUDITED)
|
||||||||||||||||||||
(Amounts in Thousands, Except for Per Share Data)
|
||||||||||||||||||||
THREE MONTHS ENDED
|
||||||||||||||||||||
Amounts
|
Percent of Sales
|
|||||||||||||||||||
August 2,
|
August 3,
|
% Over
|
August 2,
|
August 3,
|
||||||||||||||||
2015
|
2014
|
(Under)
|
2015
|
2014
|
||||||||||||||||
Net sales
|
$ | 80,185 | 76,060 | 5.4 | % | 100.0 | % | 100.0 | % | |||||||||||
Cost of sales
|
63,983 | 63,345 | 1.0 | % | 79.8 | % | 83.3 | % | ||||||||||||
Gross profit
|
16,202 | 12,715 | 27.4 | % | 20.2 | % | 16.7 | % | ||||||||||||
Selling, general and
|
||||||||||||||||||||
administrative expenses
|
8,741 | 7,419 | 17.8 | % | 10.9 | % | 9.8 | % | ||||||||||||
Income from operations
|
7,461 | 5,296 | 40.9 | % | 9.3 | % | 7.0 | % | ||||||||||||
Interest expense
|
24 | 68 | (64.7 | ) % | 0.0 | % | 0.1 | % | ||||||||||||
Interest income
|
(66 | ) | (142 | ) | (53.5 | ) % | (0.1 | )% | (0.2 | ) % | ||||||||||
Other expense (income)
|
95 | (89 | ) |
N.M.
|
0.1 | % | (0.1 | ) % | ||||||||||||
Income before income taxes
|
7,408 | 5,459 | 35.7 | % | 9.2 | % | 7.2 | % | ||||||||||||
Income taxes*
|
2,707 | 2,115 | 28.0 | % | 36.5 | % | 38.7 | % | ||||||||||||
Net income
|
$ | 4,701 | 3,344 | 40.6 | % | 5.9 | % | 4.4 | % | |||||||||||
Net income per share-basic
|
$ | 0.38 | $ | 0.27 | 40.7 | % | ||||||||||||||
Net income per share-diluted
|
$ | 0.38 | $ | 0.27 | 40.7 | % | ||||||||||||||
Average shares outstanding-basic
|
12,277 | 12,212 | 0.5 | % | ||||||||||||||||
Average shares outstanding-diluted
|
12,456 | 12,404 | 0.4 | % |
PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
|
||||||||||||||||||||
THREE MONTHS ENDED
|
||||||||||||||||||||
Amounts
|
Percent of Sales
|
|||||||||||||||||||
August 2,
|
August 3,
|
% Over
|
August 2,
|
August 3,
|
||||||||||||||||
2015
|
2014
|
(Under)
|
2015
|
2014
|
||||||||||||||||
Income before income taxes (see above)
|
$ | 7,408 | 5,459 | 35.7 | % | 9.2 | % | 7.2 | % | |||||||||||
Adjusted Income taxes (2)*
|
1,163 | 912 | 27.5 | % | 15.7 | % | 16.7 | % | ||||||||||||
Adjusted net income
|
6,245 | 4,547 | 37.3 | % | 7.8 | % | 6.0 | % | ||||||||||||
Adjusted net income per share-basic
|
$ | 0.51 | $ | 0.37 | 37.8 | % | ||||||||||||||
Adjusted net income per share-diluted
|
$ | 0.50 | $ | 0.37 | 35.1 | % | ||||||||||||||
Average shares outstanding-basic
|
12,277 | 12,212 | 0.5 | % | ||||||||||||||||
Average shares outstanding-diluted
|
12,456 | 12,404 | 0.4 | % |
(1) Culp, Inc. currently does not incur cash income tax expense in the US due to its $32.2 million in net operating loss carryforwards as of May 3, 2015. Therefore, adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 8 of 8.
|
(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 8 of 8.
|
* Percent of sales column for income taxes is calculated as a % of income before income taxes.
|
CULP, INC. FINANCIAL INFORMATION RELEASE
|
||||||||||||||||||||
CONSOLIDATED BALANCE SHEETS
|
||||||||||||||||||||
AUGUST 2, 2015, AUGUST 3, 2014, AND MAY 3, 2015
|
||||||||||||||||||||
Unaudited
|
||||||||||||||||||||
(Amounts in Thousands)
|
||||||||||||||||||||
Amounts
|
Increase
|
|||||||||||||||||||
August 2,
|
August 3,
|
(Decrease)
|
* May 3,
|
|||||||||||||||||
2015
|
2014
|
Dollars
|
Percent
|
2015
|
||||||||||||||||
Current assets
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 25,933 | 24,665 | 1,268 | 5.1 | % | 29,725 | |||||||||||||
Short-term investments
|
6,336 | 6,311 | 25 | 0.4 | % | 10,004 | ||||||||||||||
Accounts receivable
|
25,707 | 24,239 | 1,468 | 6.1 | % | 28,749 | ||||||||||||||
Inventories
|
46,544 | 41,688 | 4,856 | 11.6 | % | 42,484 | ||||||||||||||
Deferred income taxes
|
6,986 | 6,203 | 783 | 12.6 | % | 4,790 | ||||||||||||||
Income taxes receivable
|
142 | 136 | 6 | 4.4 | % | 229 | ||||||||||||||
Other current assets
|
3,502 | 2,308 | 1,194 | 51.7 | % | 2,440 | ||||||||||||||
Total current assets
|
115,150 | 105,550 | 9,600 | 9.1 | % | 118,421 | ||||||||||||||
Property, plant & equipment, net
|
37,480 | 31,891 | 5,589 | 17.5 | % | 36,078 | ||||||||||||||
Goodwill
|
11,462 | 11,462 | - | 0.0 | % | 11,462 | ||||||||||||||
Deferred income taxes
|
412 | 973 | (561 | ) | (57.7 | ) % | 447 | |||||||||||||
Long-term Investments
|
2,893 | 1,749 | 1,144 | 65.4 | % | 2,415 | ||||||||||||||
Other assets
|
2,475 | 2,587 | (112 | ) | (4.3 | ) % | 2,545 | |||||||||||||
Total assets
|
$ | 169,872 | 154,212 | 15,660 | 10.2 | % | 171,368 | |||||||||||||
Current liabilities
|
||||||||||||||||||||
Current maturities of long-term debt
|
$ | 2,200 | 2,200 | - | 0.0 | % | 2,200 | |||||||||||||
Accounts payable - trade
|
28,233 | 24,458 | 3,775 | 15.4 | % | 28,414 | ||||||||||||||
Accounts payable - capital expenditures
|
613 | 204 | 409 | 200.5 | % | 990 | ||||||||||||||
Accrued expenses
|
7,731 | 6,365 | 1,366 | 21.5 | % | 11,129 | ||||||||||||||
Income taxes payable - current
|
392 | 387 | 5 | 1.3 | % | 325 | ||||||||||||||
Total current liabilities
|
39,169 | 33,614 | 5,555 | 16.5 | % | 43,058 | ||||||||||||||
Income taxes payable - long-term
|
3,634 | 4,037 | (403 | ) | (10.0 | ) % | 3,792 | |||||||||||||
Deferred income taxes
|
4,064 | 1,013 | 3,051 | 301.2 | % | 1,050 | ||||||||||||||
Line of credit
|
- | 569 | (569 | ) | (100.0 | ) % | - | |||||||||||||
Deferred compensation
|
4,280 | 3,632 | 648 | 17.8 | % | 4,041 | ||||||||||||||
Long-term debt , less current maturities
|
- | 2,200 | (2,200 | ) | (100.0 | ) % | - | |||||||||||||
Total liabilities
|
51,147 | 45,065 | 6,082 | 13.5 | % | 51,941 | ||||||||||||||
Shareholders' equity
|
118,725 | 109,147 | 9,578 | 8.8 | % | 119,427 | ||||||||||||||
Total liabilities and
|
||||||||||||||||||||
shareholders' equity
|
$ | 169,872 | 154,212 | 15,660 | 10.2 | % | 171,368 | |||||||||||||
Shares outstanding
|
12,339 | 12,217 | 122 | 1.0 | % | 12,219 | ||||||||||||||
* Derived from audited financial statements.
|
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
FOR THE THREE MONTHS ENDED AUGUST 2, 2015 AND AUGUST 3, 2014
|
||||||||
Unaudited
|
||||||||
(Amounts in Thousands)
|
||||||||
THREE MONTHS ENDED
|
||||||||
Amounts
|
||||||||
August 2,
|
August 3,
|
|||||||
2015
|
2014
|
|||||||
Cash flows from operating activities:
|
|
|||||||
Net income
|
$ | 4,701 | 3,344 | |||||
Adjustments to reconcile net income to net cash
|
||||||||
provided by operating activities:
|
||||||||
Depreciation
|
1,555 | 1,399 | ||||||
Amortization of other assets
|
47 | 47 | ||||||
Stock-based compensation
|
265 | 46 | ||||||
Deferred income taxes
|
1,641 | 1,193 | ||||||
Gain on sale of equipment
|
(46 | ) | (45 | ) | ||||
Excess tax benefits related to stock-based compensation
|
(788 | ) | (99 | ) | ||||
Foreign currency exchange gains
|
(57 | ) | (201 | ) | ||||
Changes in assets and liabilities:
|
||||||||
Accounts receivable
|
2,774 | 3,168 | ||||||
Inventories
|
(4,068 | ) | (1,021 | ) | ||||
Other current assets
|
(1,149 | ) | 40 | |||||
Other assets
|
23 | 283 | ||||||
Accounts payable
|
(132 | ) | (2,224 | ) | ||||
Accrued expenses and deferrred compensation
|
(3,870 | ) | (1,855 | ) | ||||
Income taxes
|
159 | (24 | ) | |||||
Net cash provided by operating activities
|
1,055 | 4,051 | ||||||
Cash flows from investing activities:
|
||||||||
Capital expenditures
|
(3,336 | ) | (2,333 | ) | ||||
Proceeds from the sale of equipment
|
104 | 391 | ||||||
Proceeds from the sale of short-term investments
|
3,612 | - | ||||||
Purchase of short-term investments
|
(33 | ) | (27 | ) | ||||
Purchase of long-term investments
|
(478 | ) | (984 | ) | ||||
Net cash used in investing activities
|
(131 | ) | (2,953 | ) | ||||
Cash flows from financing activities:
|
||||||||
Excess tax benefits related to stock-based compensation
|
788 | 99 | ||||||
Repurchase of common stock
|
- | (556 | ) | |||||
Dividends paid
|
(5,676 | ) | (5,502 | ) | ||||
Proceeds from common stock issued
|
56 | - | ||||||
Net cash used in financing activities
|
(4,832 | ) | (5,959 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents
|
116 | 223 | ||||||
Decrease in cash and cash equivalents
|
(3,792 | ) | (4,638 | ) | ||||
Cash and cash equivalents at beginning of period
|
29,725 | 29,303 | ||||||
Cash and cash equivalents at end of period
|
$ | 25,933 | 24,665 | |||||
Free Cash Flow (1)
|
$ | (1,751 | ) | 1,447 |
(1) Free Cash Flow reconciliation is as follows:
|
|||||||||||
FY 2016
|
FY 2015
|
||||||||||
A) |
Net cash provided by operating activities
|
$ | 1,055 | 4,051 | |||||||
B) |
Minus: Capital Expenditures
|
(3,336 | ) | (2,333 | ) | ||||||
C) |
Add: Proceeds from the sale of equipment
|
104 | 391 | ||||||||
D) |
Add: Excess tax benefits related to stock-based compensation
|
788 | 99 | ||||||||
E) |
Minus: Purchase of long-term investments
|
(478 | ) | (984 | ) | ||||||
F) |
Effects of exchange rate changes on cash and cash equivalents
|
116 | 223 | ||||||||
$ | (1,751 | ) | 1,447 | ||||||||
CULP, INC. FINANCIAL INFORMATION RELEASE
|
||||||||||||||||||||
STATEMENTS OF OPERATIONS BY SEGMENT
|
||||||||||||||||||||
FOR THE THREE MONTHS ENDED AUGUST 2, 2015 AND AUGUST 3, 2014
|
||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||
THREE MONTHS ENDED
|
||||||||||||||||||||
Amounts
|
Percent of Total Sales
|
|||||||||||||||||||
August 2,
|
August 3,
|
% Over
|
August 2,
|
August 3,
|
||||||||||||||||
Net Sales by Segment
|
2015
|
2014
|
(Under)
|
2015
|
2014
|
|||||||||||||||
Mattress Fabrics
|
$ | 47,808 | 42,822 | 11.6 | % | 59.6 | % | 56.3 | % | |||||||||||
Upholstery Fabrics
|
32,377 | 33,238 | (2.6 | ) % | 40.4 | % | 43.7 | % | ||||||||||||
Net Sales
|
$ | 80,185 | 76,060 | 5.4 | % | 100.0 | % | 100.0 | % | |||||||||||
Gross Profit by Segment
|
Gross Profit Margin
|
|||||||||||||||||||
Mattress Fabrics
|
$ | 9,925 | 7,202 | 37.8 | % | 20.8 | % | 16.8 | % | |||||||||||
Upholstery Fabrics
|
6,277 | 5,513 | 13.9 | % | 19.4 | % | 16.6 | % | ||||||||||||
Gross Profit
|
16,202 | 12,715 | 27.4 | % | 20.2 | % | 16.7 | % | ||||||||||||
Selling, General and Administrative expenses by Segment
|
Percent of Sales | |||||||||||||||||||
Mattress Fabrics
|
$ | 2,923 | 2,574 | 13.6 | % | 6.1 | % | 6.0 | % | |||||||||||
Upholstery Fabrics
|
3,595 | 3,452 | 4.1 | % | 11.1 | % | 10.4 | % | ||||||||||||
Unallocated Corporate expenses
|
2,223 | 1,393 | 59.6 | % | 2.8 | % | 1.8 | % | ||||||||||||
Selling, General and Administrative Expenses
|
8,741 | 7,419 | 17.8 | % | 10.9 | % | 9.8 | % | ||||||||||||
Operating Income (loss) by Segment
|
Operating Income (Loss) Margin
|
|||||||||||||||||||
Mattress Fabrics
|
$ | 7,003 | 4,629 | 51.3 | % | 14.6 | % | 10.8 | % | |||||||||||
Upholstery Fabrics
|
2,681 | 2,060 | 30.1 | % | 8.3 | % | 6.2 | % | ||||||||||||
Unallocated corporate expenses
|
(2,223 | ) | (1,393 | ) | 59.6 | % | (2.8 | ) % | (1.8 | ) % | ||||||||||
Operating Income
|
7,461 | 5,296 | 40.9 | % | 9.3 | % | 7.0 | % | ||||||||||||
Return on Capital (1)
|
||||||||||||||||||||
Mattress Fabrics
|
39.5 | % | 29.5 | % | ||||||||||||||||
Upholstery Fabrics
|
65.0 | % | 45.2 | % | ||||||||||||||||
Unallocated Corporate
|
N/A | N/A | ||||||||||||||||||
Consolidated
|
34.3 | % | 26.0 | % | ||||||||||||||||
Capital Employed (2)
|
||||||||||||||||||||
Mattress Fabrics
|
71,349 | 62,936 | 13.4 | % | ||||||||||||||||
Upholstery Fabrics
|
18,946 | 19,052 | (0.6 | ) % | ||||||||||||||||
Unallocated Corporate
|
298 | 1,160 | N/A | |||||||||||||||||
Consolidated
|
90,593 | 83,148 | 9.0 | % | ||||||||||||||||
Depreciation expense by Segment
|
||||||||||||||||||||
Mattress Fabrics
|
$ | 1,359 | 1,219 | 11.5 | % | |||||||||||||||
Upholstery Fabrics
|
196 | 180 | 8.9 | % | ||||||||||||||||
Depreciation expense
|
1,555 | 1,399 | 11.2 | % | ||||||||||||||||
Notes:
|
||||||||||||||||||||
(1) See pages 6 and 7 of this financial information release for calculations.
|
||||||||||||||||||||
(2) The capital employed balances are as of August 2, 2015 and August 3, 2014.
|
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF ADJUSTED EBITDA | ||||||||||||||||||||
FOR THE TWELVE MONTHS ENDED AUGUST 2, 2015 AND AUGUST 3, 2014 | ||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||
(AMOUNTS IN THOUSANDS) | ||||||||||||||||||||
Quarter Ended
|
||||||||||||||||||||
Trailing 12
|
||||||||||||||||||||
Months
|
||||||||||||||||||||
11/2/2014
|
2/1/2015
|
5/3/2015
|
8/2/2015
|
8/2/2015
|
||||||||||||||||
Net income
|
$ | 3,001 | $ | 3,812 | $ | 4,913 | $ | 4,701 | $ | 16,427 | ||||||||||
Income taxes
|
1,889 | 2,110 | 1,772 | 2,707 | 8,478 | |||||||||||||||
Interest income, net
|
(153 | ) | (202 | ) | (128 | ) | (42 | ) | (525 | ) | ||||||||||
Depreciation and amortization expense
|
1,460 | 1,478 | 1,576 | 1,602 | 6,116 | |||||||||||||||
Stock based compensation
|
245 | 191 | 304 | 265 | 1,005 | |||||||||||||||
Adjusted EBITDA
|
$ | 6,442 | $ | 7,389 | $ | 8,437 | $ | 9,233 | $ | 31,501 | ||||||||||
Quarter Ended
|
||||||||||||||||||||
Trailing 12
|
||||||||||||||||||||
Months
|
||||||||||||||||||||
10/27/2013
|
1/26/2014
|
4/27/2014
|
8/3/2014
|
8/3/2014
|
||||||||||||||||
Net income
|
$ | 3,096 | $ | 8,381 | $ | 2,740 | $ | 3,344 | $ | 17,561 | ||||||||||
Income taxes
|
1,718 | (3,807 | ) | 1,380 | 2,115 | 1,406 | ||||||||||||||
Interest income, net
|
(3 | ) | (57 | ) | (43 | ) | (74 | ) | (177 | ) | ||||||||||
Depreciation and amortization expense
|
1,373 | 1,370 | 1,394 | 1,446 | 5,583 | |||||||||||||||
Stock based compensation
|
224 | 175 | 159 | 46 | 604 | |||||||||||||||
Adjusted EBITDA
|
$ | 6,408 | $ | 6,062 | $ | 5,630 | $ | 6,877 | $ | 24,977 | ||||||||||
% Over (Under)
|
0.5 | % | 21.9 | % | 49.9 | % | 34.3 | % | 26.1 | % |
CULP, INC. FINANCIAL INFORMATION RELEASE | |||||||||||||
RETURN ON CAPITAL EMPLOYED BY SEGMENT | |||||||||||||
FOR THE THREE MONTHS ENDED AUGUST 2, 2015 | |||||||||||||
(Amounts in Thousands) | |||||||||||||
(Unaudited) | |||||||||||||
Operating Income
|
|||||||||||||
Three Months
|
Average
|
Return on
|
|||||||||||
Ended
|
Capital
|
Avg. Capital
|
|||||||||||
August 2, 2015 (1)
|
Employed (3)
|
Employed (2)
|
|||||||||||
Mattress Fabrics
|
$ | 7,003 | $ | 70,911 | 39.5 | % | |||||||
Upholstery Fabrics
|
2,681 | 16,486 | 65.0 | % | |||||||||
(less: Unallocated Corporate)
|
(2,223 | ) | (488 | ) | N/A | ||||||||
Total
|
$ | 7,461 | $ | 86,909 | 34.3 | % |
Average Capital Employed
|
As of the three Months Ended August 2, 2015
|
As of the three Months Ended May 3, 2015
|
||||||||||||||||||||||||||||||
Mattress
|
Upholstery
|
Unallocated
|
Mattress
|
Upholstery
|
Unallocated
|
|||||||||||||||||||||||||||
Fabrics
|
Fabrics
|
Corporate
|
Total
|
Fabrics
|
Fabrics
|
Corporate
|
Total
|
|||||||||||||||||||||||||
Total assets
|
91,614 | 33,795 | 44,463 | 169,872 | 89,066 | 32,838 | 49,464 | 171,368 | ||||||||||||||||||||||||
Total liabilities
|
(20,265 | ) | (14,849 | ) | (16,033 | ) | (51,147 | ) | (18,594 | ) | (18,812 | ) | (14,535 | ) | (51,941 | ) | ||||||||||||||||
Subtotal
|
$ | 71,349 | $ | 18,946 | $ | 28,430 | $ | 118,725 | $ | 70,472 | $ | 14,026 | $ | 34,929 | $ | 119,427 | ||||||||||||||||
Less:
|
||||||||||||||||||||||||||||||||
Cash and cash equivalents
|
- | - | (25,933 | ) | (25,933 | ) | - | - | (29,725 | ) | (29,725 | ) | ||||||||||||||||||||
Short-term investments
|
- | - | (6,336 | ) | (6,336 | ) | - | - | (10,004 | ) | (10,004 | ) | ||||||||||||||||||||
Long-term investments
|
- | - | (2,893 | ) | (2,893 | ) | - | - | (2,415 | ) | (2,415 | ) | ||||||||||||||||||||
Income taxes receivable
|
- | - | (142 | ) | (142 | ) | - | - | (229 | ) | (229 | ) | ||||||||||||||||||||
Deferred income taxes - current
|
- | - | (6,986 | ) | (6,986 | ) | - | - | (4,790 | ) | (4,790 | ) | ||||||||||||||||||||
Deferred income taxes - non-current
|
- | - | (412 | ) | (412 | ) | - | - | (447 | ) | (447 | ) | ||||||||||||||||||||
Current maturities of long-term debt
|
- | - | 2,200 | 2,200 | - | - | 2,200 | 2,200 | ||||||||||||||||||||||||
Income taxes payable - current
|
- | - | 392 | 392 | - | - | 325 | 325 | ||||||||||||||||||||||||
Income taxes payable - long-term
|
- | - | 3,634 | 3,634 | - | - | 3,792 | 3,792 | ||||||||||||||||||||||||
Deferred income taxes - non-current
|
- | - | 4,064 | 4,064 | - | - | 1,050 | 1,050 | ||||||||||||||||||||||||
Deferred compensation
|
- | - | 4,280 | 4,280 | - | - | 4,041 | 4,041 | ||||||||||||||||||||||||
Total Capital Employed
|
$ | 71,349 | $ | 18,946 | $ | 298 | $ | 90,593 | $ | 70,472 | $ | 14,026 | $ | (1,273 | ) | $ | 83,225 |
Mattress
|
Upholstery
|
Unallocated
|
|||||||||||||||
Fabrics
|
Fabrics
|
Corporate
|
Total
|
||||||||||||||
Average Capital Employed (3)
|
$ | 70,911 | $ | 16,486 | $ | (488 | ) | $ | 86,909 |
Notes: | |
(1) |
See reconciliation per page 4 of this financial information release.
|
(2) |
Return on average capital employed represents operating income for the three month period ending August 2, 2015 times four quarters to arrive at an annualized value then divided by average capital employed. Average capital employed does not include cash and cash equivalents, short-term investments, long-term investments, current maturities of long-term debt, current and noncurrent deferred tax assets and liabilities, income taxes receivable and payable, and deferred compensation.
|
(3) |
Average capital employed was computed using the two periods ending August 2, 2015 and May 3, 2015.
|
CULP, INC. FINANCIAL INFORMATION RELEASE | |||||||||||||
RETURN ON CAPITAL EMPLOYED BY SEGMENT | |||||||||||||
FOR THE THREE MONTHS ENDED AUGUST 3, 2014 | |||||||||||||
(Amounts in Thousands) | |||||||||||||
(Unaudited) | |||||||||||||
Operating Income
|
|||||||||||||
Three Months
|
Average
|
Return on
|
|||||||||||
Ended
|
Capital
|
Avg. Capital
|
|||||||||||
August 3, 2014 (1)
|
Employed (3)
|
Employed (2)
|
|||||||||||
Mattress Fabrics
|
$ | 4,629 | $ | 62,697 | 29.5 | % | |||||||
Upholstery Fabrics
|
2,060 | 18,236 | 45.2 | % | |||||||||
(less: Unallocated Corporate)
|
(1,393 | ) | 661 | N/A | |||||||||
Total
|
$ | 5,296 | $ | 81,593 | 26.0 | % |
Average Capital Employed
|
As of the three Months Ended August 3, 2014
|
As of the three Months Ended April 27, 2014
|
||||||||||||||||||||||||||||||
Mattress
|
Upholstery
|
Unallocated
|
Mattress
|
Upholstery
|
Unallocated
|
|||||||||||||||||||||||||||
Fabrics
|
Fabrics
|
Corporate
|
Total
|
Fabrics
|
Fabrics
|
Corporate
|
Total
|
|||||||||||||||||||||||||
Total assets
|
81,400 | 30,520 | 42,292 | 154,212 | 79,055 | 34,987 | 46,893 | 160,935 | ||||||||||||||||||||||||
Total liabilities
|
(18,464 | ) | (11,468 | ) | (15,133 | ) | (45,065 | ) | (16,598 | ) | (17,568 | ) | (15,025 | ) | (49,191 | ) | ||||||||||||||||
Subtotal
|
$ | 62,936 | $ | 19,052 | $ | 27,159 | $ | 109,147 | $ | 62,457 | $ | 17,419 | $ | 31,868 | $ | 111,744 | ||||||||||||||||
Less:
|
||||||||||||||||||||||||||||||||
Cash and cash equivalents
|
- | - | (24,665 | ) | (24,665 | ) | - | - | (29,303 | ) | (29,303 | ) | ||||||||||||||||||||
Short-term investments
|
- | - | (6,311 | ) | (6,311 | ) | - | - | (6,294 | ) | (6,294 | ) | ||||||||||||||||||||
Long-term investments
|
- | - | (1,749 | ) | (1,749 | ) | - | - | (765 | ) | (765 | ) | ||||||||||||||||||||
Income taxes receivable
|
- | - | (136 | ) | (136 | ) | - | - | (121 | ) | (121 | ) | ||||||||||||||||||||
Deferred income taxes - current
|
- | - | (6,203 | ) | (6,203 | ) | - | - | (6,230 | ) | (6,230 | ) | ||||||||||||||||||||
Deferred income taxes - non-current
|
- | - | (973 | ) | (973 | ) | - | - | (2,040 | ) | (2,040 | ) | ||||||||||||||||||||
Current maturities of long-term debt
|
- | - | 2,200 | 2,200 | - | - | 2,200 | 2,200 | ||||||||||||||||||||||||
Line of credit
|
- | - | 569 | 569 | 586 | 586 | ||||||||||||||||||||||||||
Income taxes payable - current
|
- | - | 387 | 387 | - | - | 442 | 442 | ||||||||||||||||||||||||
Income taxes payable - long-term
|
- | - | 4,037 | 4,037 | - | - | 3,962 | 3,962 | ||||||||||||||||||||||||
Deferred income taxes - non-current
|
- | - | 1,013 | 1,013 | - | - | 1,013 | 1,013 | ||||||||||||||||||||||||
Deferred compensation
|
- | - | 3,632 | 3,632 | - | - | 2,644 | 2,644 | ||||||||||||||||||||||||
Long-term debt, less current maturities
|
- | - | 2,200 | 2,200 | - | - | 2,200 | 2,200 | ||||||||||||||||||||||||
Total Capital Employed
|
$ | 62,936 | $ | 19,052 | $ | 1,160 | $ | 83,148 | $ | 62,457 | $ | 17,419 | $ | 162 | $ | 80,038 |
Mattress
|
Upholstery
|
Unallocated
|
|||||||||||||||
Fabrics
|
Fabrics
|
Corporate
|
Total
|
||||||||||||||
Average Capital Employed (3)
|
$ | 62,697 | $ | 18,236 | $ | 661 | $ | 81,593 |
Notes: | |
(1) |
See reconciliation per page 4 of this financial information release.
|
(2) |
Return on average capital employed represents operating income for the three month period ending August 3, 2014 times four quarters to arrive at an annualized value then 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 receivable and payable, and deferred compensation.
|
(3) |
Average capital employed was computed using the two periods ending August 3, 2014 and April 27, 2014.
|
CULP, INC. FINANCIAL INFORMATION RELEASE
|
|||||||||||||
CONSOLIDATED ADJUSTED EFFECTIVE INCOME TAX RATE, NET INCOME AND EARNINGS PER SHARE
|
|||||||||||||
FOR THE THREE MONTHS ENDED AUGUST 2, 2015 AND AUGUST 3, 2014
|
|||||||||||||
Unaudited
|
|||||||||||||
(Amounts in Thousands)
|
|||||||||||||
THREE MONTHS ENDED | |||||||||||||
Amounts | |||||||||||||
August 2,
|
August 3,
|
||||||||||||
2015
|
2014
|
||||||||||||
Consolidated Effective GAAP Income Tax Rate
|
(1) | 36.5 | % | 38.7 | % | ||||||||
Non-Cash U.S. Income Tax Expense
|
(20.5 | )% | (21.2 | )% | |||||||||
Non-Cash Foreign Income Tax Expense
|
(0.3 | )% | (0.8 | )% | |||||||||
Consolidated Adjusted Effective Income Tax Rate
|
(2) | 15.7 | % | 16.7 | % |
THREE MONTHS ENDED
|
||||||||||||||||||||||||
As reported
|
As Adjusted
|
As reported
|
As Adjusted
|
|||||||||||||||||||||
August 2,
|
August 2,
|
August 3,
|
August 3,
|
|||||||||||||||||||||
2015
|
Adjustments
|
2015
|
2014
|
Adjustments
|
2014
|
|||||||||||||||||||
Income before income taxes
|
$ | 7,408 | $ | 7,408 | $ | 5,459 | $ | 5,459 | ||||||||||||||||
Income taxes (3)
|
2,707 | $ | (1,544 | ) | 1,163 | 2,115 | $ | (1,203 | ) | 912 | ||||||||||||||
Net income
|
$ | 4,701 | $ | 1,544 | $ | 6,245 | $ | 3,344 | $ | 1,203 | $ | 4,547 | ||||||||||||
Net income per share-basic
|
$ | 0.38 | $ | 0.13 | $ | 0.51 | $ | 0.27 | $ | 0.10 | $ | 0.37 | ||||||||||||
Net income per share-diluted
|
$ | 0.38 | $ | 0.12 | $ | 0.50 | $ | 0.27 | $ | 0.10 | $ | 0.37 | ||||||||||||
Average shares outstanding-basic
|
12,277 | 12,277 | 12,277 | 12,212 | 12,212 | 12,212 | ||||||||||||||||||
Average shares outstanding-diluted
|
12,456 | 12,456 | 12,456 | 12,404 | 12,404 | 12,404 |
(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) |
Adjusted income taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.
|
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