News & Events zu Culp Inc (CULP)CULPCulp Inc

US Indices Down for Third Day as Oil Prices Rise

US indices were down for the third consecutive trading day as the macro-oriented refrain of higher oil prices and rising Treasury yields continued to haunt sentiment.   Energy was the only S&P 500 sector in the green, with front-month WTI Crude Oil contract testing the upside of $97 per barrel for the first time since May as U.S.-Iran tensions continue to percolate.  Industrials and Consumer Cyclicals were the worst-performing areas of the market and Casey's General Storeswas the worst performing stock in the benchmark.  In Tech, Semiconductors and Software Infrastructure saw some notable gains among stocks like SK Hynix, Marvell, Cloudflareand Akamaiwith relative weakness seen in Hardware and SaaS groups.  Metawas also a notable standout with a positive market reaction to its  personal AI agent Muse release, though Apple'sproduct announcements under its new CEO Ternusdid not produce an outsized reaction in its share price.  Similar to yesterday, the Dow Industrials index fared worse than S&P 500 and Nasdaq Composite given its much greater exposure to Industrials and lower exposure to Energy, as it fell to its lowest level since July with a decline of 0.8%.In the opening hour of the evening session, index futures are mixed - S&P e-minis are marginally higher while Nasdaq 100 is marginally lower.  Crude oil also continues to climb higher, with WTI contract retesting $97.   Inflation data will be top of mind for markets for the next two days - starting with tomorrow's PPI release - heading into next week's FOMC decision.  Fed funds futures are currently tipping a 60% probability of a 25 basis point rate hike next Wednesday and a 50% probability of two 25 basis point hikes over the course of the three remaining Fed decisions this year.Check out this evening's top movers from around Wall Street, compiled by The Fly.HIGHER AFTER EARNINGS -Culpup 18.6%Research Solutionsup 3.8%AeroVironmentup 2.9%ALSO HIGHER -Kinetik Holdingsup 4.3% after Bloomberg report that the company is considering options that include a saleDOWN AFTER EARNINGS -Navandown 16.5%The Cooper Companiesdown 15.7%Skillsoftdown 12.7%American Eagle Outfittersdown 10.3%Kewaunee Scientificdown 9.4%Limoneiradown 7.7%Lakeland Industriesdown 2.4%

CULP Reports Q1 Revenue of $54.0M, Exceeds Estimates

Reports Q1 revenue $54.0M, one estimate $53.3M. Iv Culp, President and Chief Executive Officer, commented, "We are pleased with our first quarter results, namely our ability to increase sales and margins and to exceed our profitability expectations irrespective of the one-time tariff recoveries. We look at our first quarter results as more proof-of-concept that all of our work to integrate, restructure and optimize our platform is generating growth and profitability even in challenging conditions like those we continue to see across home furnishings. This is a clear testament to the CULP team's successful execution of our strategic plans over the last two years. Our bedding business grew its topline by over 13% in a low-unit market environment and with one less shipping week this quarter compared to last year. We believe our bedding sales trend is significantly exceeding industry norms and provides a good indication that our commercial strategies should provide continued revenue growth, especially once we see the industry replacement cycle that many believe is overdue. Our enhanced U.S. operations combined with flexible nearshore and offshore options are elevating our already strong customer relationships and driving our success in this business. We are also encouraged to see sales in our upholstery business nearly comp the prior-year quarter despite a shorter selling period, and we are pleased with placement rates within our largest upholstery end market, residential furniture. In addition, we saw growth on the hospitality and contract side of our upholstery business and are excited about the potential to further grow those verticals. Our emphasis on the balance sheet and cash flow management was well reflected in our first quarter results. Through the success of our inventory reduction initiatives and management systems, together with our use of the tariff-proceeds received during the quarter, we reduced net debt down to $3 million from $11 million at the end of last fiscal year, and we are focused on moving to a net cash position. Overall, we are optimistic about the momentum we see across our business entering the second quarter and believe our lower cost structure and global footprint position us for continued success in this low-demand environment and accelerating profitability as conditions improve."

Company Expects Net Debt to Decline to $5 Million in Q1 FY2027

Due to macroeconomic uncertainty, the fluid global trade and tariff environment, and related matters, only the following limited forward guidance is being provided, with expectations based on information available at the time of this press release and reflecting certain assumptions by management regarding business and industry trends. Outstanding debt under domestic and foreign credit facilities is expected to significantly decline with the recovery of approximately $7.0 million in previously paid IEEPA tariffs in the first quarter of fiscal year 2027. This receipt represents a meaningful source of cash and, subject to working capital needs to support growth, is expected to reduce net debt to approximately $5.0 million at first quarter-end and improve liquidity and balance sheet flexibility. Consolidated sales for the first quarter of fiscal year 2027 are expected to moderately improve sequentially and compared to the prior-year period in what is likely to remain a challenged demand environment for home furnishings. The cost and efficiency benefits of restructuring and integration initiatives should drive improving gross profit and lower SG&A expenses, resulting in breakeven to positive adjusted EBITDA for the first quarter of fiscal year 2027 without the benefit of IEEPA tariff refunds. Receipt of the above-referenced $7.0 million in tariff refunds should significantly enhance profitability in the first quarter.