8-K

UNITED STATES

SECURITIES & EXCHANGE COMMISSION

WASHINGTON, D.C. 20449

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 27, 2007

Delta Woodside Industries, Inc.

(Exact Name of Registrant as Specified in Its Charter)

South Carolina

(State of Other Jurisdiction of Incorporation)

1-10095	57-0535180
(Commission File Number)	(IRS Employer Identification No.)

700 North Woods Drive, Fountain Inn, South Carolina  29644

(Address of Principal Executive Offices)   (Zip Code)

(864) 255-4127

(Registrant's Telephone Number Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since 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):

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

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

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

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

Item 7.01 Regulation FD Disclosure.

Monthly Operating Reports

On June 27, 2007, Delta Woodside Industries, Inc. (“Delta Woodside” or the “Company”), Delta Mills, Inc. and Delta Mills Marketing, Inc. (collectively, the “Debtors”) filed their unaudited Monthly Operating Reports for the period May 6, 2007 to June 2, 2007 ( the “Monthly Operating Reports”) with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”)  (In re Delta Mills, Inc., et al., Case Nos,. 06-11144, 06-11146, 06-11147 Jointly Administered).Exhibit 99.1 to this Current Report on Form 8-K contains the unaudited Monthly Operating Reports as filed with the Bankruptcy Court.  The Monthly Operating Reports for each of the Debtors has been filed on an unconsolidated basis.

The Monthly Operating Reports are limited in scope, cover a limited time period, and have been prepared solely for the purpose of complying with the monthly reporting requirements of the Bankruptcy Court and the United States Trustee.  Furthermore, the Monthly Operating Reports contain information that has not been audited or reviewed by independent accountants, has not been presented in accordance with generally accepted accounting principles, and may be subject to future reconciliation and adjustments.  Without limiting the foregoing, the financial information in the Monthly Operating Reports is unaudited and does not purport to show the financial statements of any of the Debtors in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and therefore may exclude items required by GAAP, such as certain reclassifications, eliminations, accruals, impairments and disclosure items.  For example, among other matters, the value of (including without limitation the actual or likely sales prices for) many of the assets shown on the balance sheets included in the Monthly Operating Reports will be substantially less than what is shown in such information.  The Company cautions readers not to place undue reliance upon the Monthly Operating Reports.  There can be no assurance that the information in the Monthly Operating Reports is complete.  The Monthly Operating Reports may be subject to revision.  The Monthly Operating Reports are in a format required by the United States Trustee and should not be used for investment purposes.  The information in the Monthly Operating Reports should not be viewed as indicative of future results.

Limitation on Incorporation by Reference

The Monthly Operating Reports are being furnished for informational purposes only and are not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.  Registration statements or other documents filed with the U.S. Securities and Exchange Commission shall not incorporate the Monthly Operating Reports or any other information set forth in this Current Report on Form 8-K by reference, except as otherwise expressly stated in such filing.  This Current Report on Form 8-K will not be deemed an admission as to the materiality of any information in the report.

Item 9.01 Financial Statements and Exhibits.

99.1 Delta Woodside Industries, Inc., Delta Mills, Inc. and Delta Mills Marketing, Inc. Monthly Operating Reports for the period May 6, 2006 to June 2, 2007.

SIGNATURES

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

	DELTA WOODSIDE INDUSTRIES, INC.
Date:  June 29, 2007	By:	/s/ W.H. Hardman, Jr.
		W.H. Hardman, Jr.
		Chief Financial Officer

Exhibits

99.1 Delta Woodside Industries, Inc., Delta Mills, Inc. and Delta Mills Marketing, Inc. Monthly Operating Reports for the period May 6, 2006 to June 2, 2007.

EX-99.1

In re: Delta Mills, Inc.           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11144

DISTRICT OF DELAWARE           5/6/07 - 6/2/07

Monthly Operating Report

Required Documents

Schedule of Cash Receipts and Disbursements Bank Reconciliation

Copies of bank statements

Cash disbursements journals

Statement of Operations

Balance Sheet

Status of Post-Petition Taxes

Copies of IRS Form 6123 or payment receipt Copies of tax returns filed during reporting period Summary of Unpaid Post-Petition Debts

Listing of aged accounts payable

Accounts Receivable Reconciliation and Aging Debtor Questionnaire

Document Explanation Form No.           Attached           Attached

MOR - 1           Yes

MOR - 1           Yes

MOR - 2           Yes

MOR - 3           Yes

MOR - 4           Yes

MOR - 4           Yes

MOR - 5           Yes

MOR - 5           Yes

Signature of Debtor           Date

Signature of Joint Debtor           Date

Signature of Authorized Individua

June 27, 2007

W. H. Hardman, Jr.           Chief Financial Officer

Printed Name of Authorized Individual           Title of Authorized Individual

Page  of 7

Delta Mills, Inc., at. al. (Dollars In Thousands)

DISTRICT OF DELAWARE In re: Delta Mills, Inc. UNITED STATES BANKRUPTCY COURT                      Jointly Administered Case no: -11144 5/6/07 - 6/2/07 Page  of 7 mor-1 Delta Mills. Inc. Sales Government Sales Twill Sales Total Net Sales Opening Cash Balance Cash Receipts: Accounts Receivable Collections- Collections Basis Accounts Receivable Collections- Maturity Basis Nylon Payments/Other Total Cash Receipts

Operating Disbursements : Al P Disbursements Wires Out Net Wages and  Salaries Total Operating Disbursements Other (Sources)/ Uses : (Inc) / Dec in UC's Transfers to Delta Mills Marketing Co. Professional Fees Transfers to Delta Woodside Employee Vacation Accrual and Severance Payouts Vendor   Deposits DIP Fee, Factoring Fee, and Bank Interest Proceeds from the Sale of PP&E Proceeds from the Sale of Remaining Inventory Total (Sources) / Uses:

Operating Cash Flow Accumulate WEEK ->>           1           2           3

12-May           19•May           28-May           02-Jun           TOTALI it

•           -           -           917 74 69           105           251           11 Delta Mills Net Cash Flo Accumulate  44           44           442 156 143           148           295           11           598

18 44 19           34           27           28 7           26           10 15           48           14           , 10611

88I. 96 81           58           100           52           289

62 82 ~           93 1 54           ~           195 349           ~           (41) 308           308

(45) 44           (6) -           -           - 637           12           (29)           (6) (45) 665 (1)           637           12           (35)           614 83 14           1,351           ~(544) 807182 989(8)l 983(305) 4 Delta Mills Net Cash Flo Accumulate  Delta Woodside Industries. Inc. Transfers (In)/Out from Delta Mills6 Bank Fees Other(6),

Total Disbursements - Delta Woodside           (6) Delta Woodside Industries. Inc. Transfers (In)/Out from Delta Mills                      6 Bank Fees Other           (6), Total Disbursements - Delta Woodside           (6) Delta Woodside Net Cash Flow'  Accumulated Delta Mills Marketing. Inc. Transfers (In)/Out from Delta Mills Bank Fees Payroll Vacation and Severance Payouts Other Total Disbursements - Delta Woodside Delta Woodside Net Cash Flow Accumulated

In re: Delta Mills, Inc.           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11144

DISTRICT OF DELAWARE           5/6/07 - 6/2/07

DELTA MILLS, INC.

INCOME STATEMENT           Month Ended

6/2/2007

Net Sales

Cost of goods sold           (35,545)

Gross profit (loss)           (35,545)

Selling, general and administrative expenses           (1,494,810)

Impairment and restructuring expenses

Other income (expense)

OPERATING LOSS           (1,530,355)

Interest expense*           (603,446)

Gain on extinguishment of debt

LOSS BEFORE INCOME TAXES           (2,133, 802)

Income tax expense / (benefit)

NET LOSS           (2,133,802)

* Includes $600k fee charged by bank

Page  of 7           MOR-2

In re: Delta Mills, Inc.           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11144

DISTRICT OF DELAWARE           5/6/07 - 6/2/07

Bank Reconciliations

I attest that each of the debtors' bank accounts is reconciled to monthly bank statements. The company's standard practice is to ensure that each bank account is reconciled to monthly bank statements for each calendar month within 30 days after the quarter end. Also attached is an example of the cash management report that the debtor prepares on all of its operating bank accounts other than petty cash on a daily basis.

W.H. Hardman, Jr.

Chief Financial Officer Delta Mills, et al.

Page 4 of 7

In re: Delta Mills, Inc.           UNITED STATES BANKRUPTCY COURTJointly Administered Case no: 06-11144

DISTRICT OF DELAWARE5/6/07 - 6/2/07 BALANCE SHEET As Of 6/2/07 (In Thousands, Except Share Data)                      Delta Mills, Inc. As Of 6/2/07 ASSETS CURRENT ASSETS Cash and cash equivalents$9,436 Accounts receivable:

Factor and other2,258 Less allowances for returns30 2,228 Inventories Finished goods0 Work in process0 Raw materials and supplies877 877 Deferred income taxes 493 Other assets 562 TOTAL CURRENT ASSETS 13,596 PROPERTY, PLANT AND EQUIPMENT, at cost Land and land improvements Buildings Machinery and equipment Furniture, fixtures and office equipment

Leasehold improvements Construction in progress  24,006 Less accumulated depreciation                      14,629 9,376 DEFERRED LOAN COSTS, less accumulated depreciation of $5,966,000 (2006)and $5,856,000 (2005)                      25 TOTAL ASSETS           $           22,997

LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable - Post Petition                      $           4 Trade accounts payable checks outstanding           47 Revolving credit facility           0 Accrued income taxes payable           12,394 Payable to Affiliate Delta Mills Marketing, Inc.           1,904 Payable to Affiliate Delta Woodside Industries, Inc.           3,657 Payable to Affiliate Delta Mills, Inc.           0 Accrued employee compensation           65

Accrued restructuring expenses           0 Accrued and sundry liabilities           1,152 TOTAL CURRENT LIABILITIES           19,223

LIABLITIES SUBJECT TO COMPROMISE: Notes Payable           30,941 Trade Accounts Payable - Pre Petition           3,549

Accrued Interest - Notes Payable           1,836 Total Liabilities Subject to Compromise           36,326 NONCURRENT DEFERRED INCOME TAXES           2,061 SHAREHOLDERS' EQUITY Common Stock -- par value $.01 a share – authorized 3,000 shares, issued and outstanding 100 shares                                1 Additional paid-in capital           51,791 Retained earnings(deficit)           (86,405) TOTAL SHAREHOLDERS' EQUITY           (34,613) COMMITMENTS AND CONTINGENCIES           0 TOTAL LIABILITIES AND SHAREHOLDERS'S EQUITY           $           22,997 Page 5 of 7MOR-3

In re: delta mills, inc. united states bankruptcy court district of Delaware jointly administered case no: 06-11144 5/6/07-6/2/07 status of post-petition taxes beginning accrued liability balance liability incurred during period disbursements to taxing authorities net change in accrued balance ending accrued liability balance

Federal withholding south Carolina withholding FICA – Employee FICA – Employer total taxes summary of unpaid post-petition debts accounts payable total post-petition debts current 0-30 31-60 61-90 over 90 total number of days past due 3,855.76 5,627.82 2,200.80 1,827.07 11,482.76 24,832.90 9,048.42 7,545.52 48,972.36 (24,899.40) (9,084.97) (7,550.53) (49,085.43) (66.50) (36.55) (5.01) (113.07) 5,561.32 2,184.25 1,822.06 11,369.69

In re: Delta Mills, Inc.           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11144

DISTRICT OF DELAWARE           5/6/07 - 6/2/07

ACCOUNTS RECEIVABLE RECONCILATION AND AGING

Accounts Receivable Reconciliation

Total Accounts Receivable at the beginning of the reporting period*:                      $           2,940,442.08

+ Amounts billed during the period

- Amounts collected (net) during the period           (712,536.49)

Total Accounts Receivable at the end of the reporting period:           $           2,227,905.59

* Beginning AR was adjusted for credits not reflected in prior month

Accounts Receivable Aging

Days Outstanding

Current (0 - 60 days):           $           1,009,539.00

61 - 90 days old:           9,950.00

91 - 120 days old:

121 - 150 days old:           75,547.00

151+ days old:           1,483,832.71

Total Accounts Receivable           $           2,578,868.71

Amount considered uncollectible & Net Credits           (350,963.12)

Accounts Receivable (Net)           $           2,227,905.59

DEBTOR QUESTIONNAIRE

Must be completed each month

1.           Have any assets been sold or transferred outside the normal course of business this reporting period? No.

2.           Have any funds been disbursed from any account other than a debtor in possession account this reporting period? No.

3.           Have all postpetition tax returns been timely filed? Yes.

4.           Are workers compensation, general liability and other necessary insurance coverages in effect? Yes.

Page 7 of 7 mor-5

EX-99.2

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146 Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07 Monthly Operating Report Signature of Joint Debtor Date Signature of Authorized IndividuJ                      June 27, 2007 W. H. Hardman, Jr. Chief Financial Officer

Printed Name of Authorized Individual Title of Authorized Individual Page  of 7

Required Documents Schedule of Cash Receipts and Disbursements Bank Reconciliation

Copies of bank statements Cash disbursements journals Statement of Operations

Balance Sheet Status of Post-Petition Taxes Copies of IRS Form 6123 or payment receipt Copies of tax returns filed during reporting period Summary of Unpaid Post-Petition Debts Listing of aged accounts payable Accounts Receivable Reconciliation and Aging Debtor Questionnaire Form No. MOR-1 MOR-1 MOR-2 MOR-3 MOR-4

MOR-4  MOR-5 MOR-5 Document Explanation Attached Attached Yes Yes Yes Yes Yes Yes N/A Yes Date Signature of Debtor page 1 of 7

ge 1 of 7

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146 Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07  WEEK -» Delta Mills. Inc. Sales Government Sales Twill Sales Total Net Sales Opening Cash Balance Cash Receipts: Accounts Receivable Collections- Collections Basis Accounts Receivable Collections- Maturity Basis Nylon Payments/Other Total Cash Receipts Operatin_o Disbursements : A / P Disbursements Wires Out Net Wages and Salaries Total Operating Disbursements                                                                           Operating Cash Flow

 Other (Sources)/ Uses : (Inc) / Dec in UC's Transfers to Delta Mills Marketing Co. Professional Fees Transfers to Delta Woodside Employee Vacation Accrual and Severance Payouts Vendor Deposits DIP Fee, Factoring Fee, and Bank Interest Proceeds from the Sale of PP&E Proceeds from the Sale of Remaining Inventory Total (Sources) I Uses:                                                                Delta Mills Net Cash Flow

 Accumulated Accumulated Delta Woodside Net Cash Flow. Accumulated Delta Mills Marketing, Inc. Transfers (In)/Out from Delta Mills Bank Fees Payroll Vacation and Severance Payouts Other Total Disbursements - Delta Woodside  Delta Woodside Industries. Inc. Transfers (In)/Out from Delta Mills                                                      6 Bank Fees Other (6) Total Disbursements - Delta Woodside (6)  11                      2]           3           4                       12-May           19-Mav2 Mav02-JunTOTAL- •-917 74105 694425111 44- -442 156 - 14314829511698 1834 447 19152728 2610 48141106 88 96 815610052289  82 6293 154~195 349(41)1 308308 - (45)- 44637 --(6) -- 12(29)t(6) (45) 665 (1)63712(35)614 63j(544)182(8)(305) I1.351807]989983

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146

Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07

Bank Reconciliations

I attest that each of the debtors' bank accounts is reconciled to monthly bank statements. The company's standard practice is to ensure that each bank account is reconciled to monthly bank statements for each calendar month within 30 days after the quarter end. Also attached is an example of the cash management report that the debtor prepares on all of its operating bank accounts other than petty cash on a daily basis. W.H. Hardman, Jr. Chief Financial Officer Delta Mills, et al.

Page 3 of 7

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146 Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07 DELTA WOODSIDE INDUSTRIES, INC.            INCOME STATEMENT Month Ended Net Sales Cost of goods sold                      6/2/2007 Gross profit (loss) Selling, general and administrative expenses Impairment and restructuring expenses Other income (expense)                                 OPERATING LOSS            Interest expense           (363) Gain on extinguishment of debt LOSS BEFORE INCOME TAXES(363) Income tax expense / (benefit) NET LOSS$(363)  Page 4 of 7 mor-2

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146 Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07  BALANCE SHEET As Of 6/2/07 (In Thousands, Except Share Data)                      Delta Woodside Industries, Inc. As Of 6/2107 ASSETS CURRENT ASSETS Cash and cash equivalents                      $           0 Accounts receivable:           0 Factor and other           0 Less allowances for returns           0 Inventories Finished goods0 Work in process0 Raw materials and supplies0 Deferred income taxes(248) Other assets(0) TOTAL CURRENT ASSETS(248) PROPERTY, PLANT AND EQUIPMENT, at cost0 Less accumulated depreciation0 DEFERRED LOAN COSTS, less accumulated depreciation of $5,966,000 (2006)and $5,856,000 (2005)0 TOTAL ASSETS$(248) LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable - Post Petition$- Trade accounts payable checks outstanding0 Revolving credit facility0 Accrued income taxes payable(13,427) Payable to Affiliate Delta Mills Marketing, Inc.0 Payable to Affiliate Delta Woodside Industries, Inc.0 Payable to Affiliate Delta Mills, Inc.(3,657) Accrued employee compensation0 Accrued restructuring expenses0 Accrued and sundry liabilities94 TOTAL CURRENT LIABILITIES(16,990) LIABLITIES SUBJECT TO COMPROMISE: Notes Payable0 Trade Accounts Payable - Pre Petition0 Total Liabilities Subject to Compromise0 NONCURRENT DEFERRED INCOME TAXES(248) SHAREHOLDERS' EQUITY Common Stock -- par value $.01 a share - authorized 3,000 shares, issued and outstanding 100 shares59 Additional paid-in capital35,357 Retained earnings(deficit)(18,426) TOTAL SHAREHOLDERS' EQUITY16,990 COMMITMENTS AND CONTINGENCIES0 TOTAL LIABILITIES AND SHAREHOLDERS'S EQUITY$(248) Page 5 of 7 mor-3

In re: delta woodside industries, inc. united states bankruptcy court district of Delaware jointly administered case no: 06-11146 5/6/07 – 06/2/07 status of post-petition taxes beginning accrued liability balance liability incurred during period disbursements to taxing authorities net change in accrued balance ending accrued liability balance north Carolina department of revenue total taxes summary of unpaid post-petition debts accounts payable total post-petition debts current 0-30 31-60 61-90 over 90 total number of days past due 280,400.00 – (5,800.00) 274,600.00

In re: Delta Woodside           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11146 Industries, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07 Page 7 of 7           MOR-5 DEBTOR QUESTIONNAIRE Must be completed each month 1.                      Have any assets been sold or transferred outside the normal course of business this reporting period? No. 2.                      Have any funds been disbursed from any account other than a debtor in possession account this reporting period? No. 3.                      Have all postpetition tax returns been timely filed? Yes. 4.           Are workers compensation, general liability and other necessary insurance coverages in effect? Yes.

EX-99.3

In re: Delta Mills Marketing, Inc.           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11147 DISTRICT OF DELAWARE                      5/6/07 - 6/2/07 Monthly Operating Report   Signature of Joint Debtor                      Date June 27, 2007 W. H. Hardman, Jr. Chief Financial Officer Printed Name of Authorized Individual                      Title of Authorized Individual    Required Documents Schedule of Cash Receipts and Disbursements Bank Reconciliation Copies of bank statements Cash disbursements journals Statement of Operations Balance Sheet Status of Post-Petition Taxes Copies of IRS Form 6123 or payment receipt Copies of tax returns filed during reporting period Summary of Unpaid Post-Petition Debts Listing of aged accounts payable Accounts Receivable Reconciliation and Aging Debtor QuestionnaireForm No. MOR-1 MOR-1Document Explanation AttachedAttached Yes YesMOR-2 MOR-3 MOR-4 MOR-4  MOR-5 MOR-5Yes Yes Yes   Yes  N/A Yes   Date Signature of Debtor Page 1 of 7 mor-1

In re: Delta Mills Marketing, Inc. Delta Mills, Inc., et al. (Dollars In Thousands) UNITED STATES BANKRUPTCY COURT                      Jointly Administered Case no: 06-11147  DISTRICT OF DELAWARE 5/6/07 - 6/2/07  Delta Mllls, Inc. Sales Government Sales Twill Sales Total Net Sales Opening Cash Balance Cash Receipts: Accounts Receivable Collections- Collections Basis Accounts Receivable Collections- Maturity Basis Nylon Payments/Other Total Cash Receipts Operatlnm Disbursements : A / P Disbursements Wires Out Net Wages and Salaries Total Operating Disbursements Operating Cash Flow Accumulate Other (Sources)/ Uses : (Inc) / Dec in UC's Transfers to Delta Mills Marketing Co. Professional Fees Transfers to Delta Woodside Employee Vacation Accrual and Severance Payouts Vendor Deposits DIP Fee, Factoring Fee, and Bank Interest Proceeds from the Sale of PP&E Proceeds from the Sale of Remaining Inventory Total (Sources) / Uses: Delta Mills Net Cash Flow Accumulated WEEK ->>2412-Mat'1 May26-Ma02-JunTOTAL---91774105251 69444411 111IA442 156 1431482955981I 183427 44726 19154828 10 14!106 88 96 815610052!I289  82 6293 115413195 4913083081'' _-_ (45)-- 4463712(6)~ • (29) (1)63712(35) L63 1,351(544) 807182 989J(6) '',983(306)  Delta Woodside Industries, Inc. Transfers (1n)/Out from Delta Mills6 Bank Fees Other (6) Total Disbursements - Delta Woodside (6) Delta Mills Marketing, Inc. Transfers (In)/Out from Delta Mills Bank Fees Payroll Vacation and Severance Payouts Other Total Disbursements - Delta Woodside Delta Woodside Net Cash Flow Accumulated Delta Woodside Net Cash Flow Accumulated

DISTRICT OF DELAWARE   In re: Delta Mills           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11147 Marketing, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07  DELTA MILLS MARKETING, INC. INCOME STATEMENT Month Ended

6/2/2007 Net Sales Cost of goods sold Gross profit (loss) Selling, general and administrative expenses Impairment and restructuring expenses Other income (expense) OPERATING LOSS Interest expense Gain on extinguishment of debt LOSS BEFORE INCOME TAXES Income tax expense / (benefit) NET LOSS (8,526) (8,526) (8,526) $ (8,526)

In re: Delta Mills           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11147 Marketing, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07 Bank Reconciliations I attest that each of the debtors' bank accounts is reconciled to monthly bank statements. The company's standard practice is to ensure that each bank account is reconciled to monthly bank statements for each calendar month within 30 days after the quarter end. Also attached is an example of the cash management report that the debtor prepares on all of its operating bank accounts other than petty cash on a daily basis.W.H. Hardman, Jr. Chief Financial Officer Delta Mills, et al. page 4 of 7

In re: Delta Mills           UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11147 Marketing, Inc.           DISTRICT OF DELAWARE           5/6/07 - 6/2/07  BALANCE SHEET As Of 6/2/07 (In Thousands, Except Share Data) ASSETS CURRENT ASSETS Cash and cash equivalents Accounts receivable: Factor and other Less allowances for returns                                           Delta Mills Marketing Inc. As Of 6/2/07 $ Inventories Finished goods Work in process Raw materials and supplies                       Deferred income taxes           55 Other assets            TOTAL CURRENT ASSETS55 PROPERTY, PLANT AND EQUIPMENT, at cost265 Less accumulated depreciation2640 DEFERRED LOAN COSTS, less accumulated depreciation of $5,966,000 (2006)and $5,856,000 (2005) TOTAL ASSETS$55 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable - Post Petition$ Trade accounts payable checks outstanding Revolving credit facility Accrued income taxes payable1,301 Payable to Affiliate Delta Mills Marketing, Inc. Payable to Affiliate Delta Woodside Industries, Inc. Payable From Affiliate Delta Mills, Inc.(1,904) Accrued employee compensation43 Accrued restructuring expenses Accrued and sundry liabilities29 TOTAL CURRENT LIABILITIES(532) LIABLITIES SUBJECT TO COMPROMISE: Notes Payable Trade Accounts Payable - Pre Petition2 Total Liabilities Subject to Compromise2 NONCURRENT DEFERRED INCOME TAXES(1,514) SHAREHOLDERS' EQUITY Common Stock - par value $.01 a share -- authorized 3,000 shares, issued and outstanding 100 shares0 Additional paid-in capital Retained earnings(deficit)2,098 TOTAL SHAREHOLDERS' EQUITY2,098 COMMITMENTS AND CONTINGENCIES TOTAL LIABILITIES AND SHAREHOLDERS'S EQUITY$55 Page 5 of 7 mor-3

In re: delta mills marketing, inc. united states bankruptcy court district of Delaware jointly administered case no:06-11147 5/6/07-6/2/07 status of post-petition taxes beginning accrued liability balance liability incurred during period disbursements to taxing authorities net change in accrued balance ending accrued liability balance federal withholding south caroling withholding California withholding fica – employee fica – employer new jersey state withholding new york city and state withholding total taxes summary of unpaid post-petition debts accounts payable rent/leases – building total post-petition debts current 0-30 31-60 61-90 over 90 total number of days past due – 6,490.36 270.83 1,612.85 8,644.87 12,979.82 541.66 3,225.68 17,288.82 (12, 980.27 (541.66) (3,225.69) (17,289.28) (0.45) (0.01) (0.46) 6,489.91 270.83 1,612.84 8,664.41

Page 7 of 7           MOR-5 DEBTOR QUESTIONNAIRE Must be completed each month 1.                      Have any assets been sold or transferred outside the normal course of business this reporting period? No. 2.                      Have any funds been disbursed from any account other than a debtor in possession account this reporting period? No. 3.                      Have all postpetition tax returns been timely filed? Yes. 4.           Are workers compensation, general liability and other necessary insurance coverages in effect? Yes. In re: Delta Mills                      UNITED STATES BANKRUPTCY COURT           Jointly Administered Case no: 06-11147 Marketing, Inc.           DISTRICT OF DELAWARE5/6/07 - 6/2107