Daily News
From Home Furnishing Business
Culp Profits Jump Despite Flat Sales
June 14,
2017 by Larry Thomas in Economic News, Industry 
Fabric supplier Culp Inc. (NYSE: CFI) said sales for its fiscal fourth quarter were essentially even with the same period last year, but a one-time tax benefit caused net income to spike more than 72%.
Net income for the quarter ended April 30 totaled $6.2 million or 49 cents per share. That was up from $3.6 million or 29 cents per share in the final quarter of the previous fiscal year. The company attributed much of the increase to the reversal of an earlier charge for an uncertain foreign tax situation.
Sales totaled $77.35 million, compared with $7.25 million in the same quarter last year. Mattress ticking sales were down 0.1%, while upholstery fabric sales rose 0.6%.
For the fiscal year ended April 30, sales fell 1.1% to $309.5 million, while net income jumped 32% to $22.3 million or $1.78 per share.
The company noted that pre-tax income of $29.7 million was the highest in the company’s history.
“Our results for the fourth quarter were in line with expectations, capping off an outstanding performance for Culp in fiscal 2017 in spite of a more challenging retail environment for home furnishings,” said Frank Saxon, president and CEO. “While our overall annual sales were slightly lower than the prior year, our mattress fabric segment had another record performance with total annual sales surpassing the previous year’s level.”
Saxon said the company ended the fiscal year with no debt and $54.2 million in cash and investments, which also was the highest in the company’s history.
“Our ability to offer a diverse product mix and meet the changing demands of our customers has served us well in the marketplace,” he said. “At the same time, we have continued to make substantial investments in our mattress fabric business to enhance our production capabilities, improve our operating efficiencies and continue to provide exceptional customer service.
“Our newest product introductions and ability to reach different market segments have produced favorable results for the upholstery fabric business, and we look forward to the opportunities ahead to build on this momentum.”
Also, Culp’s board of directors approved a special dividend of 21 cents per share, marking the fifth time in the past six years a special dividend has been paid. The payment is in addition to the regular quarterly dividend of 8 cents per share.
The company said both payments will be made July 17 to stockholders of record July 3.