EX-99.(B) 3 a51904805ex99b.htm EXHIBIT 99(B)
Exhibit 99(b)
Page 1 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF NET INCOME
FOR THREE MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017
(UNAUDITED)
(Amounts in Thousands, Except for Per Share Data)

       
THREE MONTHS ENDED
  
                                   
       
Amounts
          
Percent of Sales
  
       
October 28,
    
October 29,
    
% Over
    
October 28,
    
October 29,
  
       
2018
    
2017
    
(Under)
    
2018
    
2017
  
                                   
Net sales
 $
      
77,006
      
80,698
      
(4.6
)%
    
100.0
%
    
100.0
%
Cost of sales
(1)(3)(4)
   
63,680
      
64,894
      
(1.9
)%
    
82.7
%
    
80.4
%
Gross profit
          
13,326
      
15,804
      
(15.7
)%
    
17.3
%
    
19.6
%
                                               
Selling, general and
                                              
  administrative expenses
  
(3)(4)
   
10,103
      
9,415
      
7.3
%
    
13.1
%
    
11.7
%
Restructuring credit
  
(2)(4)
   
(1,061
)
    
-
      
(100.0
)%
    
(1.4
)%
    
0.0
%
Income from operations
          
4,284
      
6,389
      
(32.9
)%
    
5.6
%
    
7.9
%
                                               
Interest expense
          
18
      
37
      
(51.4
)%
    
0.0
%
    
0.0
%
Interest income
          
(151
)
    
(128
)
    
18.0
%
    
(0.2
)%
    
(0.2
)%
Other expense
          
142
      
321
      
(55.8
)%
    
0.2
%
    
0.4
%
Income before income taxes
          
4,275
      
6,159
      
(30.6
)%
    
5.6
%
    
7.6
%
                                               
Income taxes*
          
1,276
      
2,108
      
(39.5
)%
    
29.8
%
    
34.2
%
                                               
Loss from investment in unconsolidated joint venture
          
55
      
75
      
(26.7
)%
    
0.1
%
    
0.1
%
Net income
          
2,944
      
3,976
      
(26.0
)%
    
3.8
%
    
4.9
%
Less: Net income attributable to non-controlling interest
          
(11
)
    
-
      
(100.0
)%
    
(0.0
)%
    
0.0
%
Net income attributable to Culp Inc. common shareholders
 $
      
2,933
      
3,976
      
(26.2
)%
    
3.8
%
    
4.9
%
                                               
                                               
Net income attributable to Culp Inc. common shareholders per share - basic
        
$
0.23
    
$
0.32
      
(28.1
)%
                
Net income attributable to Culp Inc. common shareholders per share - diluted
        
$
0.23
    
$
0.32
      
(28.1
)%
                
Average shares outstanding-basic
          
12,515
      
12,440
      
0.6
%
                
Average shares outstanding-diluted
          
12,551
      
12,580
      
(0.2
)%
                
                                               
* Percent of sales column for income taxes is calculated as a % of income before income taxes.
                                  


Notes
   
(1)
Cost of sales for the three-month period ending October 28, 2018, includes a $270 restructuring related charge for operating costs associated with our closed upholstery fabrics plant facility located in Anderson, SC.
   
(2)
The $1.1 million restructuring credit represents a $1.1 million gain on the sale of equipment partially offset by a charge of $63 for employee termination benefits associated with the closure of our Anderson, SC upholstery fabrics plant facility.
   
(3)
During the three-month period ending October 28, 2018, our mattress fabrics segment incurred non-recurring charges totaling $248 that pertained to employee termination benefits and other operational reorganization costs. Of the $248 total non-recurring charge, $159 and $89 were recorded in cost of sales and selling, general, and administrative expenses, respectively.
   
(4)
See page 8 for our statement of operations that exclude our restructuring credit and restructuring related charges associated with our upholstery fabrics segment and non-recurring charges associated with our mattress fabrics segment for the three-month period ending October 28, 2018. There were no restructuring activities or non-recurring charges asscociated with our mattress fabrics segment noted  for the three-month period ending October 29, 2017.

Page 2 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF NET INCOME
FOR SIX MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017
(UNAUDITED)
(Amounts in Thousands, Except for Per Share Data)

       
SIX MONTHS ENDED
  
                                   
       
Amounts
          
Percent of Sales
  
       
October 28,
    
October 29,
    
% Over
    
October 28,
    
October 29,
  
       
2018
    
2017
    
(Under)
    
2018
    
2017
  
                                   
Net sales
 $
      
148,479
      
160,230
      
(7.3
)%
    
100.0
%
    
100.0
%
Cost of sales
  
(1)(3)(4)
   
124,594
      
127,962
      
(2.6
)%
    
83.9
%
    
79.9
%
Gross profit
          
23,885
      
32,268
      
(26.0
)%
    
16.1
%
    
20.1
%
                                               
Selling, general and
                                              
  administrative expenses
  
(3)(4)
   
18,136
      
18,916
      
(4.1
)%
    
12.2
%
    
11.8
%
Restructuring credit
  
(2)(4)
   
(610
)
    
-
      
(100.0
)%
    
(0.4
)%
    
0.0
%
Income from operations
          
6,359
      
13,352
      
(52.4
)%
    
4.3
%
    
8.3
%
                                               
Interest expense
          
38
      
37
      
2.7
%
    
0.0
%
    
0.0
%
Interest income
          
(301
)
    
(259
)
    
16.2
%
    
(0.2
)%
    
(0.2
)%
Other expense
          
399
      
674
      
(40.8
)%
    
0.3
%
    
0.4
%
Income before income taxes
          
6,223
      
12,900
      
(51.8
)%
    
4.2
%
    
8.1
%
                                               
Income taxes*
          
2,182
      
3,748
      
(41.8
)%
    
35.1
%
    
29.1
%
                                               
Loss from investment in unconsolidated joint venture
          
132
      
193
      
(31.6
)%
    
0.1
%
    
0.1
%
Net income
          
3,909
      
8,959
      
(56.4
)%
    
2.6
%
    
5.6
%
Less: Net income attributable to non-controlling interest
          
(19
)
    
-
      
(100.0
)%
    
(0.0
)%
    
0.0
%
Net income attributable to Culp Inc. common shareholders
 $
     
3,890
      
8,959
      
(56.6
)%
    
2.6
%
    
5.6
%
                                               
                                               
Net income attributable to Culp Inc. common shareholders per share - basic
        
$
0.31
    
$
0.72
      
(56.9
)%
                
Net income attributable to Culp Inc. common shareholders per share - diluted
        
$
0.31
    
$
0.71
      
(56.3
)%
                
Average shares outstanding-basic
          
12,512
      
12,420
      
0.7
%
                
Average shares outstanding-diluted
          
12,612
      
12,613
      
(0.0
)%
                
                                               
* Percent of sales column for income taxes is calculated as a % of income before income taxes.
  


Notes
   
(1)
Cost of sales for the six-month period ending October 28, 2018, includes restructuring related charges totaling $1.8 million, of which $1.6 million pertains to inventory markdowns and $270 pertains to operating costs associated with our closed upholstery fabrics plant facility located in Anderson, SC.
   
(2)
The $610 restructuring credit represents a $1.1 million gain on the sale of equipment partially offset by a charge of $513 for employee termination benefits associated with the closure of our Anderson, SC upholstery fabrics plant facility.
   
(3)
During the six-month period ending October 28, 2018, our mattress fabrics segment incurred non-recurring charges totaling $248 that pertained to employee termination benefits and other operational reorganization costs. Of the $248 total non-recurring charge, $159 and $89 were recorded in cost of sales and selling, general, and administrative expenses, respectively.
   
(4)
See page 9 for our statement of operations that exclude our restructuring credit and restructuring related charges associated with our upholstery fabrics segment and non-recurring charges associated with our mattress fabrics segment for the three-month period ending October 28, 2018. There were no restructuring activities or non-recurring charges associated with our mattress fabrics segment noted  for the three-month period ending October 29, 2017.

Page 3 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
  
CONSOLIDATED BALANCE SHEETS  
OCTOBER 28, 2018, OCTOBER 29, 2017 AND APRIL 29, 2018  
Unaudited  
(Amounts in Thousands)  
                         
   
Amounts
                    
   
(Condensed)
    
Increase
        
   
October 28,
    
October 29,
    
(Decrease)
    
* April 29,
  
   
2018
    
2017
    
Dollars
    
Percent
    
2018
  
                               
Current assets
                              
Cash and cash equivalents
  
$
14,768
      
15,739
      
(971
)
    
(6.2
)%
    
21,228
  
Short-term investments - Available for Sale
    
-
      
2,478
      
(2,478
)
    
(100.0
)%
    
2,451
  
Short-term investments - Held-To-Maturity
    
26,719
      
4,015
      
22,704
      
565.5
%
    
25,759
  
Accounts receivable
    
24,362
      
24,220
      
142
      
0.6
%
    
26,307
  
Inventories
    
50,601
      
50,209
      
392
      
0.8
%
    
53,454
  
Assets held for sale
    
237
      
-
      
237
      
100.0
%
    
-
  
Other current assets
    
2,461
      
2,263
      
198
      
8.7
%
    
2,870
  
Total current assets
    
119,148
      
98,924
      
20,224
      
20.4
%
    
132,069
  
                                         
Property, plant & equipment, net
    
51,325
      
52,530
      
(1,205
)
    
(2.3
)%
    
51,794
  
Goodwill
    
27,222
      
11,462
      
15,760
      
137.5
%
    
13,569
  
Intangible assets
    
10,636
      
1,428
      
9,208
      
644.8
%
    
4,275
  
Deferred income taxes
    
3,614
      
491
      
3,123
      
636.0
%
    
1,458
  
Long-term Investments - Held-To-Maturity
    
-
      
26,853
      
(26,853
)
    
(100.0
)%
    
5,035
  
Long-term Investments - Rabbi Trust
    
7,851
      
6,921
      
930
      
13.4
%
    
7,326
  
Investment in unconsolidated joint venture
    
1,470
      
1,522
      
(52
)
    
(3.4
)%
    
1,501
  
Other assets
    
945
      
912
      
33
      
3.6
%
    
957
  
                                         
Total assets
  
$
222,211
      
201,043
      
21,168
      
10.5
%
    
217,984
  
                                         
                                         
                                         
Current liabilities
                                        
Accounts payable - trade
  
$
24,007
      
24,600
      
(593
)
    
(2.4
)%
    
27,237
  
Accounts payable - capital expenditures
    
114
      
3,209
      
(3,095
)
    
(96.4
)%
    
1,776
  
Deferred revenue
    
649
      
-
      
649
      
100.0
%
    
809
  
Accrued expenses
    
8,670
      
7,364
      
1,306
      
17.7
%
    
9,325
  
Accrued restructuring costs
    
260
      
-
      
260
      
100.0
%
    
-
  
Deferred compensation
    
714
      
-
      
714
      
100.0
%
    
-
  
Income taxes payable - current
    
2,044
      
692
      
1,352
      
195.4
%
    
1,437
  
Total current liabilities
    
36,458
      
35,865
      
593
      
1.7
%
    
40,584
  
                                         
Accrued expenses - long-term
    
-
      
-
      
-
      
0.0
%
    
763
  
Contingent consideration - Earn-Out Obligation
    
5,706
      
-
      
5,706
      
100.0
%
    
-
  
Income taxes payable - long-term
    
3,233
      
487
      
2,746
      
563.9
%
    
3,758
  
Deferred income taxes
    
2,225
      
4,641
      
(2,416
)
    
(52.1
)%
    
2,150
  
Deferred compensation
    
7,120
      
6,970
      
150
      
2.2
%
    
7,353
  
                                         
Total liabilities
    
54,742
      
47,963
      
6,779
      
14.1
%
    
54,608
  
                                         
Shareholders' equity
                                        
Shareholders' equity attributable to Culp Inc.
    
162,918
      
153,080
      
9,838
      
6.4
%
    
163,376
  
Non-controlling interest
    
4,551
      
-
      
4,551
      
100.0
%
    
-
  
     
167,469
      
153,080
      
14,389
      
9.4
%
    
163,376
  
                                         
Total liabilities and
                                        
shareholders' equity
  
$
222,211
      
201,043
      
21,168
      
10.5
%
    
217,984
  
                                         
Shares outstanding
    
12,492
      
12,435
      
57
      
0.5
%
    
12,450
  
                                         
*  Derived from audited financial statements.
                                        

Page 4 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE  
SUMMARY OF CASH AND INVESTMENTS
 
OCTOBER 28, 2018, OCTOBER 29, 2017, AND APRIL 29, 2018
 
Unaudited
 
(Amounts in Thousands)
 
       
    Amounts
  
   
October 28,
    
October 29,
    
April 29,
  
   
2018
    
2017
    
2018*
                     
                     
Cash and cash equivalents
  
$
14,768
    
$
15,739
    
$
21,228
  
                         
Short-term investments - Available for Sale
    
-
      
2,478
      
2,451
  
                         
Short-term investments - Held-To-Maturity
    
26,719
      
4,015
      
25,759
  
                         
Long-term investments - Held-To-Maturity
    
-
      
26,853
      
5,035
  
                         
Total Cash and Investments
  
$
41,487
    
$
49,085
    
$
54,473
  
                         
*  Derived from audited financial statements.
                        

Page 5 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE  
CONSOLIDATED STATEMENTS OF CASH FLOWS
  
FOR THE SIX MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017
  
Unaudited
  
(Amounts in Thousands)
  
     
 
SIX MONTHS ENDED
  
     
 
Amounts
  
 
October 28,
    
October 29,
  
 
2018
    
2017
  
           
Cash flows from operating activities:
          
Net income
$
3,909
      
8,959
  
Adjustments to reconcile net income to net cash
              
provided by operating activities:
              
Depreciation
  
4,056
      
3,713
  
Amortization
  
391
      
166
  
Stock-based compensation
  
(106
)
    
1,558
  
Deferred income taxes
  
(2,081
)
    
976
  
Realized loss on sale of short-term investments (Available for Sale)
  
94
      
-
  
Gain on sale of equipment
  
(1,079
)
    
-
  
Loss from investment in unconsolidated joint venture
  
132
      
193
  
Foreign currency exchange gain (loss)
  
(102
)
    
42
  
Changes in assets and liabilities, net of effects of acquisition of businesses:
           
Accounts receivable
  
1,639
      
561
  
Inventories
  
3,767
      
1,597
  
Other current assets
  
379
      
723
  
Other assets
  
(10
)
    
(35
)
Accounts payable
  
(3,264
)
    
(5,074
)
Deferred revenue
  
(160
)
    
-
  
Accrued expenses and deferrred compensation
  
(1,472
)
    
(3,607
)
Accrued restructuring costs
  
260
      
-
  
Income taxes
  
247
      
406
  
Net cash provided by operating activities
  
6,600
      
10,178
  
               
Cash flows from investing activities:
              
Net cash paid for acquistion of businesses
  
(12,096
)
    
-
  
Capital expenditures
  
(2,096
)
    
(4,978
)
Proceeds from the sale of equipment
  
1,280
      
6
  
Investment in unconsolidated joint venture
  
(100
)
    
(609
)
Proceeds from the sale of short-term investments (Held to Maturity)
  
4,000
      
-
  
Proceeds from the sale of short-term investments (Available for Sale)
  
2,458
      
-
  
Purchase of short-term investments (Available for Sale)
  
(10
)
    
(24
)
Proceeds from the sale of long-term investments (Rabbi Trust)
  
-
      
54
  
Purchase of long-term investments (Rabbi Trust)
  
(526
)
    
(1,457
)
Net cash used in investing activities
  
(7,090
)
    
(7,008
)
               
Cash flows from financing activities:
              
Proceeds from line of credit
  
12,000
      
10,000
  
Payments on line of credit
  
(12,000
)
    
(10,000
)
Payments on vendor-financed capital expenditures
  
(1,412
)
    
(2,500
)
Dividends paid
  
(2,253
)
    
(4,603
)
Common stock surrendered for withholding taxes payable
  
(1,292
)
    
(1,147
)
Common stock repurchased
  
(844
)
    
-
  
Proceeds from common stock issued
  
-
      
5
  
Net cash used in financing activities
  
(5,801
)
    
(8,245
)
               
Effect of exchange rate changes on cash and cash equivalents
  
(169
)
    
19
  
               
Decrease in cash and cash equivalents
  
(6,460
)
    
(5,056
)
               
Cash and cash equivalents at beginning of period
  
21,228
      
20,795
  
               
Cash and cash equivalents at end of period
$
14,768
      
15,739
  
               
Free Cash Flow (1)
$
3,577
      
713
  
               
               
(1)  Free Cash Flow reconciliation is as follows:
              
 
FY 2019
    
FY 2018
  
A)  Net cash provided by operating activities
$
6,600
      
10,178
  
B)  Minus:   Capital Expenditures
  
(2,096
)
    
(4,978
)
C)  Plus:      Proceeds from the sale of equipment
  
1,280
      
6
  
D)  Minus:   Investment in unconsolidated joint venture
  
(100
)
    
(609
)
E)  Minus:   Payments on vendor-financed capital expenditures
  
(1,412
)
    
(2,500
)
F)  Plus:       Proceeds from the sale of long-term investments (Rabbi Trust)
  
-
      
54
  
G)  Minus:   Purchase of long-term investments (Rabbi Trust)
  
(526
)
    
(1,457
)
H)  Effects of exchange rate changes on cash and cash equivalents
  
(169
)
    
19
  
 
$
3,577
      
713
  
               

Page 6 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
  
STATEMENTS OF OPERATIONS BY SEGMENT  
FOR THE THREE MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(Unaudited)  
(Amounts in thousands)  
           
       
THREE MONTHS ENDED
  
                       
        Amounts          
Percent of Total Sales
  
       
October 28,
    
October 29,
    
% Over
    
October 28,
    
October 29,
  
Net Sales by Segment
      
2018
    
2017
    
(Under)
    
2018
    
2017
  
                                   
Mattress Fabrics
      
$
41,989
      
48,601
      
(13.6
)%
    
54.5
%
    
60.2
%
Upholstery Fabrics
        
35,017
      
32,097
      
9.1
%
    
45.5
%
    
39.8
%
                                             
Net Sales
      
$
77,006
      
80,698
      
(4.6
)%
    
100.0
%
    
100.0
%
                                             
                                             
Gross Profit by Segment
                              
Gross Profit Margin
  
                                             
Mattress Fabrics
      
$
7,498
      
9,730
      
(22.9
)%
    
17.9
%
    
20.0
%
Upholstery Fabrics
        
6,257
      
6,074
      
3.0
%
    
17.9
%
    
18.9
%
Subtotal
        
13,755
      
15,804
      
(13.0
)%
    
17.9
%
    
19.6
%
                                             
Other non-recurring charges
  
(1)
    
(159
)
    
-
      
(100.0
)%
    
(0.2
)%
    
0.0
%
Restructuring related charges
  
(1)
    
(270
)
    
-
      
(100.0
)%
    
(0.4
)%
    
0.0
%
                                             
Gross Profit
        
13,326
      
15,804
      
(15.7
)%
    
17.3
%
    
19.6
%
                                             
Selling, General and Administrative Expenses by Segment
                              
Percent of Sales
  
                                             
Mattress Fabrics
      
$
4,566
      
3,168
      
44.1
%
    
10.9
%
    
6.5
%
Upholstery Fabrics
        
3,535
      
3,700
      
(4.5
)%
    
10.1
%
    
11.5
%
Subtotal
        
8,101
      
6,868
      
18.0
%
    
10.5
%
    
8.5
%
                                             
Other non-recurring charges
  
(1)
    
89
      
-
      
100.0
%
    
0.1
%
    
0.0
%
Unallocated Corporate expenses
        
1,913
      
2,547
      
(24.9
)%
    
2.5
%
    
3.2
%
Selling, General and Administrative Expenses
      
$
10,103
      
9,415
      
7.3
%
    
13.1
%
    
11.7
%
                                             
                                             
Operating Income (loss) by Segment
                              
Operating Income (Loss) Margin
  
                                             
Mattress Fabrics
      
$
2,932
      
6,562
      
(55.3
)%
    
7.0
%
    
13.5
%
Upholstery Fabrics
        
2,722
      
2,374
      
14.7
%
    
7.8
%
    
7.4
%
Subtotal
      
$
5,654
      
8,936
      
(36.7
)%
    
7.3
%
    
11.1
%
                                             
Unallocated corporate expenses
        
(1,913
)
    
(2,547
)
    
(24.9
)%
    
(2.5
)%
    
(3.2
)%
Other non-recurring charges
  
(1)
    
(248
)
    
-
      
(100.0
)%
    
(0.3
)%
    
0.0
%
Restructuring credit and related charges
  
(1)
    
791
      
-
      
100.0
%
    
1.0
%
    
0.0
%
                                             
Operating income
        
4,284
      
6,389
      
(32.9
)%
    
5.6
%
    
7.9
%
                                             
                                             
                                             
Depreciation Expense by Segment
                                            
                                             
Mattress Fabrics
      
$
1,844
      
1,698
      
8.6
%
                
Upholstery Fabrics
        
197
      
207
      
(4.8
)%
                
Depreciation Expense
      
$
2,041
      
1,905
      
7.1
%
                


Notes
   
(1)
See page 8 for detailed description of charges.

Page 7 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
  
STATEMENTS OF OPERATIONS BY SEGMENT  
FOR THE SIX MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(Unaudited)  
(Amounts in thousands)  
           
       
SIX MONTHS ENDED
  
                       
        Amounts          
Percent of Total Sales
  
       
October 28,
    
October 29,
    
% Over
    
October 28,
    
October 29,
  
Net Sales by Segment
      
2018
    
2017
    
(Under)
    
2018
    
2017
  
                                   
Mattress Fabrics
      
$
78,972
      
97,030
      
(18.6
)%
    
53.2
%
    
60.6
%
Upholstery Fabrics
        
69,507
      
63,200
      
10.0
%
    
46.8
%
    
39.4
%
                                             
Net Sales
      
$
148,479
      
160,230
      
(7.3
)%
    
100.0
%
    
100.0
%
                                             
Gross Profit by Segment
                              
Gross Profit Margin
  
                                             
Mattress Fabrics
      
$
13,470
      
19,495
      
(30.9
)%
    
17.1
%
    
20.1
%
Upholstery Fabrics
        
12,410
      
12,773
      
(2.8
)%
    
17.9
%
    
20.2
%
Subtotal
        
25,880
      
32,268
      
(19.8
)%
    
17.4
%
    
20.1
%
                                             
Other non-recurring charges
  
(1)
    
(159
)
    
-
      
(100.0
)%
    
(0.1
)%
    
0.0
%
Restructuring related charges
  
(1)
    
(1,836
)
    
-
      
(100.0
)%
    
(1.2
)%
    
0.0
%
                                             
Gross Profit
        
23,885
      
32,268
      
(26.0
)%
    
16.1
%
    
20.1
%
                                             
Selling, General and Administrative Expenses by Segment
                              
Percent of Sales
  
                                             
Mattress Fabrics
      
$
7,714
      
6,559
      
17.6
%
    
9.8
%
    
6.8
%
Upholstery Fabrics
        
7,161
      
7,511
      
(4.7
)%
    
10.3
%
    
11.9
%
Subtotal
        
14,875
      
14,070
      
5.7
%
    
10.0
%
    
8.8
%
                                             
Other non-recurring charges
  
(1)
    
89
      
-
      
100.0
%
    
0.1
%
    
0.0
%
Unallocated Corporate expenses
        
3,172
      
4,846
      
(34.5
)%
    
2.1
%
    
3.0
%
Selling, General and Administrative Expenses
      
$
18,136
      
18,916
      
(4.1
)%
    
12.2
%
    
11.8
%
                                             
                                             
Operating Income (loss) by Segment
                              
Operating Income (Loss) Margin
  
                                             
Mattress Fabrics
      
$
5,755
      
12,936
      
(55.5
)%
    
7.3
%
    
13.3
%
Upholstery Fabrics
        
5,249
      
5,262
      
(0.2
)%
    
7.6
%
    
8.3
%
Subtotal
      
$
11,004
      
18,198
      
(39.5
)%
    
7.4
%
    
11.4
%
                                             
Unallocated corporate expenses
        
(3,172
)
    
(4,846
)
    
(34.5
)%
    
(2.1
)%
    
(3.0
)%
Other non-recurring charges
  
(1)
    
(248
)
    
-
      
(100.0
)%
    
(0.2
)%
    
0.0
%
Restructuring credit and related charges
  
(1)
    
(1,225
)
    
-
      
(100.0
)%
    
(0.8
)%
    
0.0
%
                                             
Operating income
        
6,359
      
13,352
      
(52.4
)%
    
4.3
%
    
8.3
%
                                             
                                             
Return on Capital (2)
                                            
                                             
Mattress Fabrics
        
23.6
%
    
37.3
%
                        
Upholstery Fabrics
        
56.5
%
    
60.5
%
                        
Unallocated Corporate
        
N/A
      
N/A
                          
Consolidated
        
18.4
%
    
27.0
%
                        
                                             
Capital Employed (2) (3)
                                            
                                             
Mattress Fabrics
      
$
79,947
      
78,476
      
1.9
%
                
Upholstery Fabrics
        
17,796
      
17,749
      
0.3
%
                
Unallocated Corporate
        
32,110
      
13,148
      
144.2
%
                
Consolidated
      
$
129,853
      
109,373
      
18.7
%
                
                                             
Depreciation Expense by Segment
                                            
                                             
Mattress Fabrics
      
$
3,644
      
3,310
      
10.1
%
                
Upholstery Fabrics
        
412
      
403
      
2.2
%
                
Depreciation Expense
      
$
4,056
      
3,713
      
9.2
%
                


Notes
   
(1)
See page 9 for detailed description of charges.
   
(2)
 See pages 11 and 12 of this financial information release for calculations.
   
(3)
 The capital employed balances are as of October 28, 2018 and October 29, 2017.

Page 8 of 13

CULP, INC.
  
ADJUSTED CONSOLIDATED STATEMENTS OF OPERATIONS  
FOR THE THREE MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(UNAUDITED)  
       
   
THREE MONTHS ENDED
  
                                                           
                                            (4)
           
   
As Reported
                           October 28, 2018           
As Reported
              
   
October 28,
    
% of
              
% of
    
Adjusted
    
% of
    
October 29,
    
% of
    
% Over
  
   
2018
    
Sales
        
Adjustments
    
Sales
    
Results
    
Sales
     2017    
Sales
    
(Under)
  
                                                             
Net sales
  
$
77,006
      
100.0
%
        
-
      
0.0
%
    
77,006
      
100.0
%
    
80,698
      
100.0
%
    
-4.6
%
Cost of sales
    
63,680
      
82.7
%
  
(1)
 
(429
)
    
-0.6
%
    
63,251
      
82.1
%
    
64,894
      
80.4
%
    
-2.5
%
Gross profit
    
13,326
      
17.3
%
        
(429
)
    
-0.6
%
    
13,755
      
17.9
%
    
15,804
      
19.6
%
    
-13.0
%
                                                                             
Selling, general and
                                                                            
  administrative expenses
    
10,103
      
13.1
%
  
(3)
 
(89
)
    
-0.1
%
    
10,014
      
13.0
%
    
9,415
      
11.7
%
    
6.4
%
Restructuring credit
    
(1,061
)
    
-1.4
%
  
(2)
 
1,061
      
1.4
%
    
-
      
0.0
%
    
-
      
0.0
%
    
0.0
%
Income from operations
    
4,284
      
5.6
%
        
543
      
0.7
%
    
3,741
      
4.9
%
    
6,389
      
7.9
%
    
-41.4
%
                                                                             
Interest expense
    
18
      
0.0
%
        
-
      
0.0
%
    
18
      
0.0
%
    
37
      
0.0
%
    
-51.4
%
Interest income
    
(151
)
    
-0.2
%
        
-
      
0.0
%
    
(151
)
    
-0.2
%
    
(128
)
    
-0.2
%
    
18.0
%
Other expense
    
142
      
0.2
%
        
-
      
0.0
%
    
142
      
0.2
%
    
321
      
0.4
%
    
-55.8
%
Income before income taxes
    
4,275
      
5.6
%
        
543
      
0.7
%
    
3,732
      
4.8
%
    
6,159
      
7.6
%
    
-39.4
%


Notes
   
(1)
The $429 represents a restructuring related charge of $270 for other operating costs associated with our closed Anderson, SC upholstery fabrics plant facility and a non-recurring charge of $159 for employee termination benefits and other operational reorganization costs associated with our mattress fabrics segment.
   
(2)
 The $1.1 million restructuring credit represents a $1.1 million gain on the sale of equipment partially offset by a charge of $63 for employee termination benefits associated with the closure of our Anderson, SC upholstery fabrics plant facility.
   
(3)
 The $89 represents employee termination benefits and other operational reorganization costs associated with our mattress fabrics segment.
   
(4)
 Actual reported results were used for comparative purposes as there were no restructuring activities or non-recurring charges associated with our mattress fabrics segment for the three-month period ending October 29, 2017.

Page 9 of 13

CULP, INC.
  
ADJUSTED CONSOLIDATED STATEMENTS OF OPERATIONS  
FOR THE SIX MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(UNAUDITED)  
       
   
SIX MONTHS ENDED
  
                                                           
                                            (4)
           
   
As Reported
                           October 28, 2018           
As Reported
              
   
October 28,
    
% of
              
% of
    
Adjusted
    
% of
    
October 29,
    
% of
    
% Over
  
   
2018
    
Sales
        
Adjustments
    
Sales
    
Results
    
Sales
     2017    
Sales
    
(Under)
  
                                                             
Net sales
  
$
148,479
      
100.0
%
        
-
      
0.0
%
    
148,479
      
100.0
%
    
160,230
      
100.0
%
    
-7.3
%
Cost of sales
    
124,594
      
83.9
%
  
(1)
 
(1,995
)
    
-1.3
%
    
122,599
      
82.6
%
    
127,962
      
79.9
%
    
-4.2
%
Gross profit
    
23,885
      
16.1
%
        
(1,995
)
    
-1.3
%
    
25,880
      
17.4
%
    
32,268
      
20.1
%
    
-19.8
%
                                                                             
Selling, general and
                                                                            
  administrative expenses
    
18,136
      
12.2
%
  
(3)
 
(89
)
    
-0.1
%
    
18,047
      
12.2
%
    
18,916
      
11.8
%
    
-4.6
%
Restructuring credit
    
(610
)
    
-0.4
%
  
(2)
 
610
      
0.4
%
    
-
      
0.0
%
    
-
      
0.0
%
    
0.0
%
Income from operations
    
6,359
      
4.3
%
        
(1,474
)
    
-1.0
%
    
7,833
      
5.3
%
    
13,352
      
8.3
%
    
-41.3
%
                                                                             
Interest expense
    
38
      
0.0
%
        
-
      
0.0
%
    
38
      
0.0
%
    
37
      
0.0
%
    
2.7
%
Interest income
    
(301
)
    
-0.2
%
        
-
      
0.0
%
    
(301
)
    
-0.2
%
    
(259
)
    
-0.2
%
    
16.2
%
Other expense
    
399
      
0.3
%
        
-
      
0.0
%
    
399
      
0.3
%
    
674
      
0.4
%
    
-40.8
%
Income before income taxes
    
6,223
      
4.2
%
        
(1,474
)
    
-1.0
%
    
7,697
      
5.2
%
    
12,900
      
8.1
%
    
-40.3
%


Notes
   
(1)
The $2.0 million represents a restructuring related charge of $1.6 million for inventory markdowns and $270 for operating costs associated with the closure of our Anderson, SC plant upholstery fabrics plant facility and $159 for employee termination benefits and other operational reorganization costs associated with our mattress fabrics segment.
   
(2)
 The $610 restructuring credit represents a $1.1 million gain on the sale of equipment partially offset by a charge of $513 for employee termination benefits associated with the closure of our Anderson, SC upholstery fabrics plant facility.
   
(3)
 The $89 represents employee termination benefits and other operational reorganization costs associated with our mattress fabrics segment.
   
(4)
 Actual reported results were used for comparative purposes as there were no restructuring activities or non-recurring charges associated with our mattress fabrics segment for the six-month period ending October 29, 2017.

Page 10 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
  
CONSOLIDATED STATEMENTS OF ADJUSTED EBITDA  
FOR THE TWELVE MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(UNAUDITED)  
 (AMOUNTS IN THOUSANDS)  

                             
    Quarter Ended         
                           
Trailing 12
  
                           
Months
  
   
1/28/2018
    
4/29/2018
    
7/29/2018
    
10/28/2018
    
10/28/2018
  
                               
Net income (loss)
  
$
(748
)
  
$
12,666
    
$
965
    
$
2,944
    
$
15,827
  
Income taxes
    
8,208
      
(6,217
)
    
906
      
1,276
      
4,173
  
Interest income, net
    
(101
)
    
(117
)
    
(130
)
    
(133
)
    
(481
)
Other non-recurring charges
    
-
      
-
      
-
      
248
      
248
  
Restructuring expense (credit) and related charges
    
-
      
-
      
2,016
      
(791
)
    
1,225
  
Depreciation and amortization expense
    
2,048
      
2,096
      
2,160
      
2,287
      
8,591
  
Stock based compensation
    
864
      
(210
)
    
(501
)
    
395
      
548
  
Adjusted EBITDA
 
$
10,271
    
$
8,218
    
$
5,416
    
$
6,226
    
$
30,131
  
                                         
                                         
                                         
    Quarter Ended         
                                   
Trailing 12
  
                                   
Months
  
   
1/29/2017
    
4/30/2017
    
7/30/2017
    
10/29/2017
    
10/29/2017
  
                                         
Net income
  
$
6,347
    
$
6,198
    
$
4,984
    
$
3,976
    
$
21,505
  
Income taxes
    
643
      
778
      
1,640
      
2,108
      
5,169
  
Interest income, net
    
(124
)
    
(134
)
    
(131
)
    
(91
)
    
(480
)
Other non-recurring charges
    
-
      
-
      
-
      
-
      
-
  
Restructuring expense (credit) and related charges
    
-
      
-
      
-
      
-
      
-
  
Depreciation and amortization expense
    
1,875
      
1,863
      
1,889
      
1,990
      
7,617
  
Stock based compensation
    
962
      
739
      
757
      
801
      
3,259
  
Adjusted EBITDA
 
$
9,703
    
$
9,444
    
$
9,139
    
$
8,784
    
$
37,070
  
                                         
% Over (Under)
    
5.9
%
    
-13.0
%
    
-40.7
%
    
-29.1
%
    
-18.7
%

Page 11 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
RETURN ON CAPITAL EMPLOYED BY SEGMENT
FOR THE TWELVE MONTHS ENDED OCTOBER 28, 2018
(Amounts in Thousands)
(Unaudited)

    Operating Income                                                                     
   
Twelve Months
  
Average
  
Return on
                                                      
   
Ended
  
Capital
   Avg. Capital                                                        
   
October 28, 2018 (1)
  
Employed (3)
   Employed (2)                                                        
                                                                         
Mattress Fabrics
  
$
18,680
    
$
79,006
      
23.6
%
                                                      
Upholstery Fabrics
    
10,940
      
19,372
      
56.5
%
                                                      
(less: Unallocated Corporate)
    
(7,680
)
    
21,083
      
N/A
                                                        
Total
  
$
21,940
    
$
119,461
      
18.4
%
                                                      
                                                                               
                                                                               
Average Capital Employed
  
As of the three Months Ended October 28, 2018
    
As of the three Months Ended July 29, 2018
    
As of the three Months Ended April 29, 2018
  
   
Mattress
    
Upholstery
     Unallocated             
Mattress
    
Upholstery
     Unallocated             
Mattress
    
Upholstery
     Unallocated           
   
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
  
                                                                               
Total assets (4)
  
$
91,697
      
37,442
      
93,072
      
222,211
    
$
98,064
      
37,386
      
90,922
      
226,372
    
$
95,061
      
39,812
      
83,111
      
217,984
  
Total liabilities (5)
    
(11,750
)
    
(19,646
)
    
(23,346
)
    
(54,742
)
    
(14,593
)
    
(17,880
)
    
(27,869
)
    
(60,342
)
    
(17,335
)
    
(18,679
)
    
(18,594
)
    
(54,608
)
                                                                                                 
Subtotal
  
$
79,947
    
$
17,796
    
$
69,726
    
$
167,469
    
$
83,471
    
$
19,506
    
$
63,053
    
$
166,030
    
$
77,726
    
$
21,133
    
$
64,517
    
$
163,376
  
Less:
                                                                                                
Cash and cash equivalents
    
-
      
-
      
(14,768
)
    
(14,768
)
    
-
      
-
      
(8,593
)
    
(8,593
)
    
-
      
-
      
(21,228
)
    
(21,228
)
Short-term investments - Available-For-Sale
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
(2,451
)
    
(2,451
)
Short-term investments - Held-To-Maturity
    
-
      
-
      
(26,719
)
    
(26,719
)
    
-
      
-
      
(30,756
)
    
(30,756
)
    
-
      
-
      
(25,759
)
    
(25,759
)
Long-term investments - Held-To-Maturity
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
(5,035
)
    
(5,035
)
Long-term investments - Rabbi Trust
    
-
      
-
      
(7,851
)
    
(7,851
)
    
-
      
-
      
(7,671
)
    
(7,671
)
    
-
      
-
      
(7,326
)
    
(7,326
)
Deferred income taxes - non-current
    
-
      
-
      
(3,614
)
    
(3,614
)
    
-
      
-
      
(3,721
)
    
(3,721
)
    
-
      
-
      
(1,458
)
    
(1,458
)
Deferred compensation - current
    
-
      
-
      
714
      
714
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Income taxes payable - current
    
-
      
-
      
2,044
      
2,044
      
-
      
-
      
1,244
      
1,244
      
-
      
-
      
1,437
      
1,437
  
Income taxes payable - long-term
    
-
      
-
      
3,233
      
3,233
      
-
      
-
      
3,733
      
3,733
      
-
      
-
      
3,758
      
3,758
  
Deferred income taxes - non-current
    
-
      
-
      
2,225
      
2,225
      
-
      
-
      
2,150
      
2,150
      
-
      
-
      
2,150
      
2,150
  
Line of credit
    
-
      
-
      
-
      
-
      
-
      
-
      
4,000
      
4,000
      
-
      
-
      
-
      
-
  
Deferred compensation - non-current
    
-
      
-
      
7,120
      
7,120
      
-
      
-
      
7,679
      
7,679
      
-
      
-
      
7,353
      
7,353
  
                                                                                                 
Total Capital Employed
  
$
79,947
    
$
17,796
    
$
32,110
    
$
129,853
    
$
83,471
    
$
19,506
    
$
31,118
    
$
134,095
    
$
77,726
    
$
21,133
    
$
15,958
    
$
114,817
  
                                                                                                 
                                                                                                 
   
As of the three Months Ended January 28, 2018
    
As of the three Months Ended October 29, 2017
                                  
   
Mattress
    
Upholstery
     Unallocated            
Mattress
    
Upholstery
     Unallocated                                          
   
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
                                  
                                                                                                 
Total assets (4)
  
$
93,827
      
43,458
      
79,559
      
216,844
    
$
94,626
      
34,974
      
71,443
      
201,043
                                  
Total liabilities (5)
    
(18,418
)
    
(22,781
)
    
(23,463
)
    
(64,662
)
    
(16,150
)
    
(17,225
)
    
(14,588
)
    
(47,963
)
                                
                                                                                                 
Subtotal
  
$
75,409
    
$
20,677
    
$
56,096
    
$
152,182
    
$
78,476
    
$
17,749
    
$
56,855
    
$
153,080
                                  
Less:
                                                                                                
Cash and cash equivalents
    
-
      
-
      
(22,428
)
    
(22,428
)
    
-
      
-
      
(15,739
)
    
(15,739
)
                                
Short-term investments - Available-For-Sale
    
-
      
-
      
(2,472
)
    
(2,472
)
    
-
      
-
      
(2,478
)
    
(2,478
)
                                
Short-term investments - Held-To-Maturity
    
-
      
-
      
(17,206
)
    
(17,206
)
    
-
      
-
      
(4,015
)
    
(4,015
)
                                
Long-term investments - Held-To-Maturity
    
-
      
-
      
(13,625
)
    
(13,625
)
    
-
      
-
      
(26,853
)
    
(26,853
)
                                
Long-term investments - Rabbi Trust
    
-
      
-
      
(7,176
)
    
(7,176
)
    
-
      
-
      
(6,921
)
    
(6,921
)
                                
Deferred income taxes - non-current
    
-
      
-
      
(1,942
)
    
(1,942
)
    
-
      
-
      
(491
)
    
(491
)
                                
Deferred compensation - current
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
                                  
Income taxes payable - current
    
-
      
-
      
1,580
      
1,580
      
-
      
-
      
692
      
692
                                  
Income taxes payable - long-term
    
-
      
-
      
10,940
      
10,940
      
-
      
-
      
487
      
487
                                  
Deferred income taxes - non-current
    
-
      
-
      
2,096
      
2,096
      
-
      
-
      
4,641
      
4,641
                                  
Line of credit
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
                                  
Deferred compensation - non-current
    
-
      
-
      
7,216
      
7,216
      
-
      
-
      
6,970
      
6,970
                                  
                                                                                                 
Total Capital Employed
  
$
75,409
    
$
20,677
    
$
13,079
    
$
109,165
    
$
78,476
    
$
17,749
    
$
13,148
    
$
109,373
                                  
                                                                                                 
                                                                                                 
   
Mattress
    
Upholstery
     Unallocated                                                                          
   
Fabrics
    
Fabrics
    
Corporate
    
Total
                                                                  
                                                                                                 
Average Capital Employed (3)
  
$
79,006
    
$
19,372
    
$
21,083
    
$
119,461
                                                                  


Notes
   
(1)
See reconciliation per page 13 of this financial information release.
   
(2)
 Return on average capital employed represents the last twelve months operating income as of October 28, 2018, divided by average capital employed. Average capital employed does not include cash and cash equivalents, short-term investments - Available- For-Sale, short-term investments Held-To-Maturity, long-term investments Held-To-Maturity, long-term investments - Rabbi Trust, noncurrent deferred income tax assets and liabilities, income taxes receivable and payable, line of credit, and current and noncurrent deferred compensation.
   
(3)
 Average capital employed was computed using the quarterly five periods ending October 28, 2018, July 29, 2018, April 29, 2018, January 28, 2018, and October 29, 2017.
   
(4)
 Intangible assets and goodwill are included in unallocated corporate for all periods presented and therfore, have no affect on the capital employed and return on capital employed for both our mattress fabrics and upholstery fabrics segments.
   
(5)
 Accrued restructuring costs and certain obligations associated with our acquisitions are included in unallocated coporate for all periods presented and therfore, have no affect on capital employed and return on capital employed for both our mattress fabrics and upholstery fabrics segments.

Page 12 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
RETURN ON CAPITAL EMPLOYED BY SEGMENT
FOR THE TWELVE MONTHS ENDED OCTOBER 29, 2017
(Amounts in Thousands)
(Unaudited)

    Operating Income                                                                   
   
Twelve Months
  
Average
  
Return on
                                                      
   
Ended
  
Capital
   Avg. Capital                                                       
   
October 29, 2017 (1)
  
Employed (3)
   Employed (2)                                                       
                                                                         
Mattress Fabrics
  
$
26,450
    
$
70,822
      
37.3
%
                                                      
Upholstery Fabrics
    
10,879
      
17,973
      
60.5
%
                                                      
(less: Unallocated Corporate)
    
(9,871
)
    
12,787
      
N/A
                                                        
Total
  
$
27,458
    
$
101,583
      
27.0
%
                                                      
                                                                               
                                                                               
                                                                               
Average Capital Employed
  
As of the three Months Ended October 29, 2017
    
As of the three Months Ended July 30, 2017
    
As of the three Months Ended April 30, 2017
  
   
Mattress
    
Upholstery
     Unallocated             
Mattress
    
Upholstery
     Unallocated             
Mattress
    
Upholstery
     Unallocated          
   
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
  
                                                                               
Total assets (4)
  
$
94,626
      
34,974
      
71,443
    
$
201,043
    
$
99,190
      
34,491
      
74,223
    
$
207,904
    
$
98,087
    
$
32,255
    
$
75,292
    
$
205,634
  
Total liabilities
    
(16,150
)
    
(17,225
)
    
(14,588
)
    
(47,963
)
    
(24,277
)
    
(14,983
)
    
(18,967
)
    
(58,227
)
    
(27,619
)
    
(16,249
)
    
(13,136
)
    
(57,004
)
                                                                                                 
Subtotal
  
$
78,476
    
$
17,749
    
$
56,855
    
$
153,080
    
$
74,913
    
$
19,508
    
$
55,256
    
$
149,677
    
$
70,468
    
$
16,006
    
$
62,156
    
$
148,630
  
Less:
                                                                                                
Cash and cash equivalents
    
-
      
-
      
(15,739
)
    
(15,739
)
    
-
      
-
      
(18,322
)
    
(18,322
)
    
-
      
-
      
(20,795
)
    
(20,795
)
Short-term investments - Available-For-Sale
    
-
      
-
      
(2,478
)
    
(2,478
)
    
-
      
-
      
(2,469
)
    
(2,469
)
    
-
      
-
      
(2,443
)
    
(2,443
)
Short-term investments - Held-To-Maturity
    
-
      
-
      
(4,015
)
    
(4,015
)
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Long-term investments - Held-To-Maturity
    
-
      
-
      
(26,853
)
    
(26,853
)
    
-
      
-
      
(30,907
)
    
(30,907
)
    
-
      
-
      
(30,945
)
    
(30,945
)
Long-term investments - Rabbi Trust
    
-
      
-
      
(6,921
)
    
(6,921
)
    
-
      
-
      
(6,714
)
    
(6,714
)
    
-
      
-
      
(5,466
)
    
(5,466
)
Income taxes receivable
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
  
Deferred income taxes - non-current
    
-
      
-
      
(491
)
    
(491
)
    
-
      
-
      
(436
)
    
(436
)
    
-
      
-
      
(419
)
    
(419
)
Income taxes payable - current
    
-
      
-
      
692
      
692
      
-
      
-
      
884
      
884
      
-
      
-
      
287
      
287
  
Income taxes payable - long-term
    
-
      
-
      
487
      
487
      
-
      
-
      
487
      
487
      
-
      
-
      
467
      
467
  
Deferred income taxes - non-current
    
-
      
-
      
4,641
      
4,641
      
-
      
-
      
4,253
      
4,253
      
-
      
-
      
3,593
      
3,593
  
Line of credit
    
-
      
-
      
-
      
-
      
-
      
-
      
5,000
      
5,000
      
-
      
-
      
-
      
-
  
Deferred compensation
    
-
      
-
      
6,970
      
6,970
      
-
      
-
      
6,769
      
6,769
      
-
      
-
      
5,520
      
5,520
  
                                                                                                 
Total Capital Employed
  
$
78,476
    
$
17,749
    
$
13,148
    
$
109,373
    
$
74,913
    
$
19,508
    
$
13,801
    
$
108,222
    
$
70,468
    
$
16,006
    
$
11,955
    
$
98,429
  
                                                                                                 
                                                                                                 
   
As of the three Months Ended January 29, 2017
    
As of the three Months Ended October 30, 2016
                                  
   
Mattress
    
Upholstery
     Unallocated            
Mattress
    
Upholstery
     Unallocated                                          
   
Fabrics
    
Fabrics
    
Corporate
    
Total
    
Fabrics
    
Fabrics
    
Corporate
    
Total
                                  
                                                                                                 
Total assets (4)
  
$
90,197
    
$
30,380
    
$
70,479
    
$
191,056
    
$
81,683
    
$
29,361
    
$
68,083
    
$
179,127
                                  
Total liabilities
    
(23,126
)
    
(11,960
)
    
(13,656
)
    
(48,742
)
    
(18,499
)
    
(11,180
)
    
(13,499
)
    
(43,178
)
                                
                                                                                                 
Subtotal
  
$
67,071
    
$
18,420
    
$
56,823
    
$
142,314
    
$
63,184
    
$
18,181
    
$
54,584
    
$
135,949
                                  
Less:
                                                                                                
Cash and cash equivalents
    
-
      
-
      
(15,659
)
    
(15,659
)
    
-
      
-
      
(13,910
)
    
(13,910
)
                                
Short-term investments - Available-For-Sale
    
-
      
-
      
(2,410
)
    
(2,410
)
    
-
      
-
      
(2,430
)
    
(2,430
)
                                
Short-term investments - Held-To-Maturity
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
                                  
Long-term investments - Held-To-Maturity
    
-
      
-
      
(30,832
)
    
(30,832
)
    
-
      
-
      
(31,050
)
    
(31,050
)
                                
Long-term investments - Rabbi Trust
    
-
      
-
      
(5,488
)
    
(5,488
)
    
-
      
-
      
(4,994
)
    
(4,994
)
                                
Income taxes receivable
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
                                  
Deferred income taxes - non-current
    
-
      
-
      
(422
)
    
(422
)
    
-
      
-
      
(581
)
    
(581
)
                                
Income taxes payable - current
    
-
      
-
      
217
      
217
      
-
      
-
      
513
      
513
                                  
Income taxes payable - long-term
    
-
      
-
      
1,817
      
1,817
      
-
      
-
      
3,734
      
3,734
                                  
Deferred income taxes - non-current
    
-
      
-
      
2,924
      
2,924
      
-
      
-
      
1,699
      
1,699
                                  
Line of credit
    
-
      
-
      
-
      
-
      
-
      
-
      
-
      
-
                                  
Deferred compensation
    
-
      
-
      
5,327
      
5,327
      
-
      
-
      
5,171
      
5,171
                                  
                                                                                                 
Total Capital Employed
  
$
67,071
    
$
18,420
    
$
12,297
    
$
97,788
    
$
63,184
    
$
18,181
    
$
12,736
    
$
94,101
                                  
                                                                                                 
                                                                                                 
   
Mattress
    
Upholstery
     Unallocated                                                                          
   
Fabrics
    
Fabrics
    
Corporate
    
Total
                                                                  
                                                                                                 
Average Capital Employed (3)
  
$
70,822
    
$
17,973
    
$
12,787
    
$
101,583
                                                                  


Notes
   
(1)
See reconciliation per page 13 of this financial information release.
   
(2)
 Return on average capital employed represents the last twelve months operating income as of October 29, 2017, divided by average capital employed. Average capital employed does not include cash and cash equivalents, short-term investments - Available- For-Sale, short-term investments Held-To-Maturity, long-term investments Held-To-Maturity, long-term investments - Rabbi Trust, noncurrent deferred income tax assets and liabilities, income taxes receivable and payable, line of credit, and noncurrent deferred compensation.
   
(3)
 Average capital employed was computed using the five quarterly periods ending October 29, 2017, July 30, 2017 April 30, 2017, January 29, 2017, and October 30, 2016.
   
(4)
 Intangible assets and goodwill are included in unallocated corporate for all periods presented and therfore, have no affect on capital employed and return on capital employed for both our mattress fabrics and upholstery fabrics segments.

Page 13 of 13

CULP, INC. FINANCIAL INFORMATION RELEASE
  
CONSOLIDATED STATEMENTS OF OPERATING INCOME  
FOR THE TWELVE MONTHS ENDED OCTOBER 28, 2018 AND OCTOBER 29, 2017  
(UNAUDITED)  
(AMOUNTS IN THOUSANDS)  
                               
   
Quarter Ended
        
                           
Trailing 12
  
                           
Months
  
   
1/28/2018
    
4/29/2018
    
7/29/2018
    
10/28/2018
    
10/28/2018
  
                               
Mattress Fabrics
  
$
6,837
    
$
6,088
    
$
2,823
    
$
2,932
    
$
18,680
  
Upholstery Fabrics
    
3,510
      
2,181
      
2,527
      
2,722
      
10,940
  
Unallocated Corporate
    
(2,703
)
    
(1,805
)
    
(1,259
)
    
(1,913
)
    
(7,680
)
Subtotal
    
7,644
      
6,464
      
4,091
      
3,741
      
21,940
  
Other non-recurring charges
    
-
      
-
      
-
      
(248
)
    
(248
)
Restructuring (expense) credit and related charges
    
-
      
-
      
(2,016
)
    
791
      
(1,225
)
                                         
Operating income
  
$
7,644
    
$
6,464
    
$
2,075
    
$
4,284
    
$
20,467
  
                                         
                                         
   
Quarter Ended (1)
     (1)
                                   
Trailing 12
  
                                   
Months
  
   
1/29/2017
    
4/30/2017
    
7/30/2017
    
10/29/2017
    
10/29/2017
  
                                         
Mattress Fabrics
  
$
6,367
    
$
7,153
    
$
6,368
    
$
6,562
    
$
26,450
  
Upholstery Fabrics
    
3,100
      
2,510
      
2,895
      
2,374
      
10,879
  
Unallocated Corporate
    
(2,532
)
    
(2,493
)
    
(2,299
)
    
(2,547
)
    
(9,871
)
Operating income
  
$
6,935
    
$
7,170
    
$
6,964
    
$
6,389
    
$
27,458
  
                                         
% Over (Under)
    
10.2
%
    
-9.8
%
    
-70.2
%
    
-32.9
%
    
-25.5
%


Notes
   
(1)
We did not have any restructuring activities or non-recurring charges associated with our mattress fabrics segment for the three-month periods ending January 29, 2017, April 30, 2017, July 30, 2017, and October 29, 2017.