Culp delivers better than expectations in Q1 FY'13

Fiscal 2013 first quarter highlights:

-         Net sales were $69.2 million, up 14.8 percent, with mattress fabric sales up 18.0 percent and upholstery fabric sales up 11.1 percent, as compared to the same quarter last year. This is the company’s highest total sales for the first quarter period in eight years.

-         Pre-tax income was $5.4 million, up 81.2 percent from the first quarter of fiscal 2012.

-         Adjusted net income (non-GAAP) was $4.3 million, or $0.34 per diluted share, for the current quarter, compared with $2.4 million, or $0.18 per diluted share, for the prior year period. Net income (GAAP) was $3.5 million, or $0.28 per diluted share, compared with net income of $1.8 million, or $0.14 per diluted share, in the prior year period.

-         The company’s financial position remained strong with a total cash position of $27.1 million and total debt of $9.9 million as of July 29, 2012.

-         During the quarter, the company repurchased 47,296 of its outstanding shares, for $470,000. Subsequent to the end of first quarter, the company repurchased an additional 455,299 shares for $4.5 million. Since June 2011, the company has repurchased 1,127,054 shares, or 8.5 percent of its outstanding shares, for a total of $10.4 million.

-         The company also announced a new authorization of additional share repurchases up to $2.0 million.

-         The company paid a cash dividend of $0.03 per share during the quarter. This was the first dividend paid since fiscal 2001.

-         The projection for the second quarter of fiscal 2013 is for overall sales to be up 2 to 6 percent as compared to the same period last year. Pre-tax income is expected to be in the range of $3.0 million to $3.7 million. Pre-tax income for the second quarter of fiscal 2012 was $2.9 million.

Overview

Commenting on the results, Frank Saxon, president and chief executive officer of Culp, Inc., said, “We are pleased with our first quarter performance, marking a solid start to fiscal 2013. These results reflect better than expected sales momentum through the summer months in both of our businesses.

“We have continued to experience a favorable customer response to our outstanding design capabilities and wide range of innovative products. Our flexible and global manufacturing platform has enhanced our ability to develop new and exciting products and meet the changing style demands of our customers.