Revenue from Contracts with Customers

3 Months Ended

Jul. 31, 2022

Revenue From Contract With Customer [Abstract]

Revenue from Contracts with Customers

4. Revenue from Contracts with Customers

Nature of Performance Obligations

Our operations are classified into two business segments: mattress fabrics and upholstery fabrics. The mattress fabrics segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery fabrics segment develops, manufactures, sources, and sells fabrics primarily to residential and commercial furniture manufacturers. In addition, the upholstery fabrics segment includes Read Window Products LLC (“Read”), which provides window treatments and sourcing of upholstery fabrics and other products, as well as measuring and installation services for Read’s products, to customers in the hospitality and commercial industries. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows.  

Our primary performance obligations include the sale of mattress fabrics and upholstery fabrics, as well as the performance of customized fabrication and installation services for Read’s products associated with window treatments.

Contract Assets & Liabilities

Certain contracts, primarily those for customized fabrication and installation services associated with Read, require upfront customer deposits that result in a contract liability which is recorded on the Consolidated Balance Sheets as deferred revenue. If upfront deposits or prepayments are not required, customers may be granted credit terms which generally range from 15–60 days.  Our terms are customary within the industries in which we operate and are not considered financing arrangements. There were no contract assets recognized as of July 31, 2022, August 1, 2021, and May 1, 2022.

A summary of the activity associated with deferred revenue follows:

	Three months ended
(dollars in thousands)	July 31, 2022			August 1, 2021
Beginning balance	$	520		$	540
Revenue recognized on contract liabilities		(821	)		(611	)
Payments received for services not yet rendered		1,669			765
Ending balance	$	1,368		$	694

Disaggregation of Revenue

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending July 31, 2022:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	29,371	$	31,523	$	60,894
Services transferred over time		—		1,710		1,710
Total Net Sales	$	29,371	$	33,233	$	62,604

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending August 1, 2021:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	43,058	$	38,290	$	81,348
Services transferred over time		—		1,699		1,699
Total Net Sales	$	43,058	$	39,989	$	83,047