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Culp, Inc. (NYSE: CFI) today reported financial and operating results for the second quarter of fiscal 2012 ended October 30, 2011.
Highlights for the second quarter of fiscal 2012 include the following:
Net sales were $58.0 million, a 19 percent increase compared with the second quarter of fiscal 2011, with mattress fabrics segment sales up 24 percent and upholstery fabric segment sales up 11 percent over the same period a year ago.
Pre-tax income was $2.9 million, or 4.9 percent of sales, compared with $3.2 million, or 6.5 percent of sales, in the prior year period.
Net income was $6.3 million, or $0.49 per diluted share, compared with net income of $4.0 million, or $0.30 per diluted share, for the second quarter of fiscal 2011. Net income for the second quarter of 2012 included an income tax benefit of $3.4 million, while net income for the previous year period included an $801,000 income tax benefit.
As of November 25, 2011, the company has repurchased 585,000 shares of Culp common stock for approximately $5.1 million, or 4.4 percent of shares outstanding at the beginning of its share repurchase program announced in June.
The company’s financial position remained strong, with cash and cash equivalents and short term investments of $24.3 million and total debt of $9.2 million as of October 30, 2011, even with stock repurchases of $4.8 million, capital expenditures of $2.6 million and debt repayments of $2.3 million.
Fiscal 2011 Year to Date Highlights
Year to date sales were $118.3 million, up 13 percent from the same period a year ago, with mattress fabrics segment sales up 14 percent and upholstery fabrics segment sales up 12 percent over the same period a year ago.
Year to date pre-tax income was $5.8 million, or 4.9 percent of sales, compared with $7.5 million, or 7.1 percent of sales for the same period last year.
Year to date net income was $8.1 million, or $0.62 per diluted share, compared with net income of $7.7 million, or $0.59 per diluted share, for the same period a year ago. Year to date net income included a $2.2 million income tax benefit, while net income for the previous year period included an income tax benefit of $270,000.
The projection for third quarter fiscal 2012 is for overall sales to increase approximately two to six percent. Pre-tax income for the third quarter of fiscal 2012 is expected to be in the range of $1.9 to $2.8 million.
Commenting on the results, Saxon said, “We are pleased with the positive sales trend for the second quarter and through the first half of fiscal 2012. Both of our businesses had impressive sales gains in spite of an uncertain global economic environment, and we are well positioned to build further on this sales momentum. These trends reflect the success of our various sales and marketing initiatives along with the benefits of our excellent design capabilities and efficient manufacturing platform. Overall, our profitability is down somewhat compared with a year ago, primarily due to higher raw material costs in both businesses and the currency impact in the upholstery fabrics business. We have established a strong competitive position in both mattress fabrics and upholstery fabrics as we have continued to deliver innovative products that meet the changing demands of our customers. As always, our primary focus is on outstanding service for our customers as a financially stable and trusted supplier. Looking ahead, we have a solid financial position and the ability to support our growth strategy in fiscal 2012, while creating value for our shareholders through our share repurchase program.”