Exhibit 99(b)
Page 1 of 7
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
FOR THE THREE MONTHS AND SIX MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||
(Amounts in Thousands, Except for Per Share Data) | ||||||||||||||||||||
THREE MONTHS ENDED | ||||||||||||||||||||
Amounts | Percent of Sales | |||||||||||||||||||
November 2, | October 28, | % Over | November 2, | October 28, | ||||||||||||||||
2008 | 2007 | (Under) | 2008 | 2007 | ||||||||||||||||
Net sales | $ | 52,263 | 64,336 | (18.8 | ) | % | 100.0 | % | 100.0 | % | ||||||||||
Cost of sales | 49,115 | 55,914 | (12.2 | ) | % | 94.0 | % | 86.9 | % | |||||||||||
Gross profit | 3,148 | 8,422 | (62.6 | ) | % | 6.0 | % | 13.1 | % | |||||||||||
Selling, general and | ||||||||||||||||||||
administrative expenses | 4,439 | 5,838 | (24.0 | ) | % | 8.5 | % | 9.1 | % | |||||||||||
Restructuring expense (credit) | 8,634 | (84 | ) | N.M. | 16.5 | % | (0.1 | ) | % | |||||||||||
(Loss) income from operations | (9,925 | ) | 2,668 | N.M. | (19.0 | ) | % | 4.1 | % | |||||||||||
Interest expense | 663 | 809 | (18.0 | ) | % | 1.3 | % | 1.3 | % | |||||||||||
Interest income | (21 | ) | (63 | ) | (66.7 | ) | % | (0.0 | ) | % | (0.1 | ) | % | |||||||
Other (income) expense | (250 | ) | 463 | N.M. | (0.5 | ) | % | 0.7 | % | |||||||||||
(Loss) income before income taxes | (10,317 | ) | 1,459 | N.M. | (19.7 | ) | % | 2.3 | % | |||||||||||
Income taxes* | 30,551 | (95 | ) | N.M. | N.M. | (6.5 | ) | % | ||||||||||||
Net (loss) income | $ | (40,868 | ) | 1,554 | N.M. | N.M. |
| 2.4 | % | |||||||||||
Net (loss) income per share-basic | ($3.23 | ) |
| 0.12 | N.M. | |||||||||||||||
Net (loss) income per share-diluted | ($3.23 | ) |
| 0.12 | N.M. | |||||||||||||||
Average shares outstanding-basic | 12,650 | 12,635 | 0.1 | % | ||||||||||||||||
Average shares outstanding-diluted | 12,650 | 12,809 | (1.2 | ) | % | |||||||||||||||
SIX MONTHS ENDED | ||||||||||||||||||||
Amounts | Percent of Sales | |||||||||||||||||||
November 2, | October 28, | % Over | November 2, | October 28, | ||||||||||||||||
2008 | 2007 | (Under) | 2008 | 2007 | ||||||||||||||||
Net sales | $ | 111,585 | 129,566 | (13.9 | ) | % | 100.0 | % | 100.0 | % | ||||||||||
Cost of sales | 101,035 | 112,088 | (9.9 | ) | % | 90.5 | % | 86.5 | % | |||||||||||
Gross profit | 10,550 | 17,478 | (39.6 | ) | % | 9.5 | % | 13.5 | % | |||||||||||
Selling, general and | ||||||||||||||||||||
administrative expenses | 9,823 | 12,159 | (19.2 | ) | % | 8.8 | % | 9.4 | % | |||||||||||
Restructuring expense | 9,036 | 348 | N.M. | 8.1 | % | 0.3 | % | |||||||||||||
(Loss) income from operations | (8,309 | ) | 4,971 | N.M. | (7.4 | ) | % | 3.8 | % | |||||||||||
Interest expense | 1,095 | 1,627 | (32.7 | ) | % | 1.0 | % | 1.3 | % | |||||||||||
Interest income | (55 | ) | (121 | ) | (54.5 | ) | % | (0.0 | ) | % | (0.1 | ) | % | |||||||
Other (income) expense | (236 | ) | 695 | N.M. | (0.2 | ) | % | 0.5 | % | |||||||||||
(Loss) income before income taxes | (9,113 | ) | 2,770 | N.M. | (8.2 | ) | % | 2.1 | % | |||||||||||
Income taxes* | 30,975 | 365 | N.M. | N.M. | 13.2 | % | ||||||||||||||
Net (loss) income | $ | (40,088 | ) | 2,405 | N.M. | N.M. |
| 1.9 | % | |||||||||||
Net (loss) income per share-basic | ($3.17 | ) |
| 0.19 | N.M. | |||||||||||||||
Net (loss) income per share-diluted | ($3.17 | ) |
| 0.19 | N.M. | |||||||||||||||
Average shares outstanding-basic | 12,649 | 12,609 | 0.3 | % | ||||||||||||||||
Average shares outstanding-diluted | 12,649 | 12,776 | (1.0 | ) | % | |||||||||||||||
* Percent of sales column for income taxes is calculated as a % of (loss) income before income taxes. |
Page 2 of 7
CULP, INC. FINANCIAL INFORMATION RELEASE | |||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||||
NOVEMBER 2, 2008, OCTOBER 28, 2007 AND APRIL 27, 2008 | |||||||||||||||
Unaudited | |||||||||||||||
(Amounts in Thousands) | |||||||||||||||
Amounts | Increase | ||||||||||||||
November 2, 2008 | October 28, 2007 | * April 27, | |||||||||||||
Dollars | Percent | ||||||||||||||
Current assets | |||||||||||||||
Cash and cash equivalents | $ | 8,522 | 16,830 | (8,308 | ) | (49.4 | ) | % | 4,914 | ||||||
Accounts receivable | 18,801 | 22,885 | (4,084 | ) | (17.8 | ) | % | 27,073 | |||||||
Inventories | 36,307 | 41,518 | (5,211 | ) | (12.6 | ) | % | 35,394 | |||||||
Deferred income taxes | - | 5,376 | (5,376 | ) | (100.0 | ) | % | 4,380 | |||||||
Assets held for sale | 4,827 | 341 | 4,486 | 1,315.5 | % | 5,610 | |||||||||
Income taxes receivable | - | 491 | (491 | ) | (100.0 | ) | % | 438 | |||||||
Other current assets | 1,100 | 1,271 | (171 | ) | (13.5 | ) | % | 1,328 | |||||||
Total current assets | 69,557 | 88,712 | (19,155 | ) | (21.6 | ) | % | 79,137 | |||||||
Property, plant & equipment, net | 26,802 | 37,887 | (11,085 | ) | (29.3 | ) | % | 32,939 | |||||||
Goodwill | 11,593 | 4,114 | 7,479 | 181.8 | % | 4,114 | |||||||||
Deferred income taxes | - | 25,762 | (25,762 | ) | (100.0 | ) | % | 29,430 | |||||||
Other assets | 2,975 | 2,439 | 536 | 22.0 | % | 2,409 | |||||||||
Total assets | $ | 110,927 | 158,914 | (47,987 | ) | (30.2 | ) | % | 148,029 | ||||||
Current liabilities | |||||||||||||||
Current maturities of long-term debt | $ | 7,383 | 12,834 | (5,451 | ) | (42.5 | ) | % | 7,375 | ||||||
Current portion of obligation under a capital lease | 692 | - | 692 | 100.0 | % | - | |||||||||
Lines of credit | - | 4,016 | (4,016 | ) | (100.0 | ) | % | - | |||||||
Accounts payable - trade | 19,192 | 20,341 | (1,149 | ) | (5.6 | ) | % | 21,103 | |||||||
Accounts payable - capital expenditures | 1,020 | 783 | 237 | 30.3 | % | 1,547 | |||||||||
Accrued expenses | 5,259 | 9,040 | (3,781 | ) | (41.8 | ) | % | 8,300 | |||||||
Accrued restructuring | 1,790 | 2,356 | (566 | ) | (24.0 | ) | % | 1,432 | |||||||
Income taxes payable - current | 1,074 | - | 1,074 | 100.0 | % | 150 | |||||||||
Total current liabilities | 36,410 | 49,370 | (12,960 | ) | (26.3 | ) | % | 39,907 | |||||||
Accounts payable - capital expenditures | 1,000 | - | 1,000 | 100.0 | % | 1,449 | |||||||||
Income taxes payable - long-term | 742 | 4,299 | (3,557 | ) | (82.7 | ) | % | 4,802 | |||||||
Deferred income taxes | 1,185 | - | 1,185 | 100.0 | % | 1,464 | |||||||||
Obligation under capital lease | 280 | - | 280 | 100.0 | % | - | |||||||||
Long-term debt , less current maturities | 24,803 | 22,120 | 2,683 | 12.1 | % | 14,048 | |||||||||
Total liabilities | 64,420 | 75,789 | (11,369 | ) | (15.0 | ) | % | 61,670 | |||||||
Shareholders' equity | 46,507 | 83,125 | (36,618 | ) | (44.1 | ) | % | 86,359 | |||||||
Total liabilities and | |||||||||||||||
shareholders' equity | $ | 110,927 | 158,914 | (47,987 | ) | (30.2 | ) | % | 148,029 | ||||||
Shares outstanding | 12,653 | 12,635 | 18 | 0.1 | % | 12,648 | |||||||||
* Derived from audited financial statements. |
Page 3 of 7
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
FOR THE SIX MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||
Unaudited | ||||||||
(Amounts in Thousands) | ||||||||
SIX MONTHS ENDED | ||||||||
Amounts | ||||||||
November 2, | October 28, | |||||||
2008 | 2007 | |||||||
Cash flows from operating activities: | ||||||||
Net (loss) income | $ | (40,088 | ) | 2,405 | ||||
Adjustments to reconcile net (loss) income to net cash | ||||||||
provided by operating activities: | ||||||||
Depreciation | 4,723 | 2,892 | ||||||
Amortization of other assets | 208 | 186 | ||||||
Stock-based compensation | 219 | 366 | ||||||
Excess tax benefit related to stock options exercised | - | (21 | ) | |||||
Deferred income taxes | 33,534 | 266 | ||||||
Restructuring expenses, net of gain on sale of related assets | 7,812 | 73 | ||||||
Changes in assets and liabilities, net of effects of acquisition of business: | ||||||||
Accounts receivable | 8,272 | 6,625 | ||||||
Inventories | 526 | (888 | ) | |||||
Other current assets | 211 | 553 | ||||||
Other assets | 88 | (31 | ) | |||||
Accounts payable | (3,203 | ) | (1,687 | ) | ||||
Accrued expenses | (3,048 | ) | 370 | |||||
Accrued restructuring | 358 | (1,002 | ) | |||||
Income taxes | (2,698 | ) | (250 | ) | ||||
Net cash provided by operating activities | 6,914 | 9,857 | ||||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (1,333 | ) | (3,385 | ) | ||||
Net cash paid for acquisition of business | (11,365 | ) | - | |||||
Proceeds from the sale of buildings and equipment | - | 2,045 | ||||||
Net cash used in investing activities | (12,698 | ) | (1,340 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from lines of credit | - | 1,423 | ||||||
Proceeds from the issuance of long-term debt | 11,000 | - | ||||||
Payments on vendor-financed capital expenditures | (874 | ) | (499 | ) | ||||
Payments on capital lease obligation | (412 | ) | - | |||||
Payments on long-term debt | (237 | ) | (3,206 | ) | ||||
Debt issuance costs | (106 | ) | - | |||||
Proceeds from common stock issued | 21 | 405 | ||||||
Excess tax benefit related to stock options exercised | - | 21 | ||||||
Net cash provided by (used in) financing activities | 9,392 | (1,856 | ) | |||||
Increase in cash and cash equivalents | 3,608 | 6,661 | ||||||
Cash and cash equivalents at beginning of period | 4,914 | 10,169 | ||||||
Cash and cash equivalents at end of period | $ | 8,522 | 16,830 | |||||
Free Cash Flow (1) | $ | 4,295 | 8,039 | |||||
(1) Free Cash Flow reconciliation is as follows: | 2nd Qtr | 2nd Qtr | ||||||
FY 2009 | FY 2008 | |||||||
A) | Net cash provided by operating activities | $ | 6,914 | 9,857 | ||||
B) | Minus: Capital Expenditures | (1,333 | ) | (3,385 | ) | |||
C) | Add: Proceeds from the sale of buildings and equipment | - | 2,045 | |||||
D) | Minus: Payments on vendor-financed capital expenditures | (874 | ) | (499 | ) | |||
E) | Minus: Payments on capital lease obligation | (412 | ) | - | ||||
F) | Add: Excess tax benefit related to stock options exercised | - | 21 | |||||
$ | 4,295 | 8,039 |
Page 4 of 7
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||||||||||||||
SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT | ||||||||||||||||||||
FOR THE THREE MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||
THREE MONTHS ENDED (UNAUDITED) | ||||||||||||||||||||
Amounts | Percent of Total Sales | |||||||||||||||||||
November 2, | October 28, | % Over | November 2, | October 28, | ||||||||||||||||
Net Sales by Segment | 2008 | 2007 | (Under) | 2008 | 2007 | |||||||||||||||
Mattress Fabrics | $ | 28,048 | 36,010 | (22.1 | ) | % | 53.7 | % | 56.0 | % | ||||||||||
Upholstery Fabrics | 24,215 | 28,326 | (14.5 | ) | % | 46.3 | % | 44.0 | % | |||||||||||
Net Sales | $ | 52,263 | 64,336 | (18.8 | ) | % | 100.0 | % | 100.0 | % | ||||||||||
Gross Profit by Segment | Gross Profit Margin | |||||||||||||||||||
Mattress Fabrics | $ | 5,084 | 6,038 | (15.8 | ) | % | 18.1 | % | 16.8 | % | ||||||||||
Upholstery Fabrics | 1,277 | 2,975 | (57.1 | ) | % | 5.3 | % | 10.5 | % | |||||||||||
Subtotal | 6,361 | 9,013 | (29.4 | ) | % | 12.2 | % | 14.0 | % | |||||||||||
Restructuring related charges | (3,213 | ) | (1 | ) | (591 | ) | (3 | ) | N.M. | (6.1 | ) | % | (0.9 | ) | % | |||||
Gross Profit | $ | 3,148 | 8,422 | (62.6 | ) | % | 6.0 | % | 13.1 | % | ||||||||||
Selling, General and Administrative expenses by Segment | Percent of Sales | |||||||||||||||||||
Mattress Fabrics | $ | 1,833 | 2,166 | (15.4 | ) | % | 6.5 | % | 6.0 | % | ||||||||||
Upholstery Fabrics | 2,081 | 2,774 | (25.0 | ) | % | 8.6 | % | 9.8 | % | |||||||||||
Unallocated Corporate expenses | 523 | 873 | (40.1 | ) | % | 1.0 | % | 1.4 | % | |||||||||||
Subtotal | 4,437 | 5,813 | (23.7 | ) | % | 8.5 | % | 9.0 | % | |||||||||||
Restructuring related charges | 2 | (1 | ) | 25 | (3 | ) | (92.0 | ) | % | 0.0 | % | 0.0 | % | |||||||
Selling, General and Administrative expenses | $ | 4,439 | 5,838 | (24.0 | ) | % | 8.5 | % | 9.1 | % | ||||||||||
Operating Income (loss) by Segment | Operating Income (Loss) Margin | |||||||||||||||||||
Mattress Fabrics | $ | 3,251 | 3,872 | (16.0 | ) | % | 11.6 | % | 10.8 | % | ||||||||||
Upholstery Fabrics | (804 | ) | 201 | N.M. | (3.3 | ) | % | 0.7 | % | |||||||||||
Unallocated corporate expenses | (523 | ) | (873 | ) | (40.1 | ) | % | (1.0 | ) | % | (1.4 | ) | % | |||||||
Subtotal | 1,924 | 3,200 | (39.9 | ) | % | 3.7 | % | 5.0 | % | |||||||||||
Restructuring expense and restructuring related charges | (11,849 | ) | (2 | ) | (532 | ) | (4 | ) | N.M. | (22.7 | ) | % | (0.8 | ) | % | |||||
Operating (loss) income | $ | (9,925 | ) | 2,668 | N.M. | (19.0 | ) | % | 4.1 | % | ||||||||||
Depreciation by Segment | ||||||||||||||||||||
Mattress Fabrics | $ | 935 | 898 | 4.1 | % | |||||||||||||||
Upholstery Fabrics | 439 | 547 | (19.7 | ) | % | |||||||||||||||
Subtotal | 1,374 | 1,445 | (4.9 | ) | % | |||||||||||||||
Accelerated depreciation | 2,090 | - | 100.0 | % | ||||||||||||||||
Total Depreciation | 3,464 | 1,445 | 139.7 | % |
Notes: |
(1) The $3.2 million restructuring related charge represents $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, and $15 for other operating costs associated with closed plant facilities. The $2 restructuring related charge represents other operating costs associated with closed plant facilities. |
(2) The $11.8 million represents $7.8 million for write-downs of a building and equipment, $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, $460 for lease termination and other exit costs, $362 for employee termination benefits, and $17 for other operating costs associated with closed plant facilities. Of this total charge, $3.2 million, $2, and $8.6 million was recorded in cost of sales, selling,general, and administrative expenses, and restructurintg expense, respectively. |
(3) The $591 restructuring related charge represents $348 for inventory markdowns and $243 for other operating costs associated with closed plant facilities. The $25 restructuring related charge represents other operating costs associated with closed plant facilities. |
(4) The $532 represents $348 for inventory markdowns, $268 for other operatings costs associated with closed plant facilities, $179 for lease termination and other exit costs, $73 for asset movement costs, $27 for write-downs of a building and equipment, a credit of $114 for proceeds received on equipment with no carrying value, and a credit of $249 for employee termination benefits. Of this total charge, $591 was recorded in cost of sales, $25 was recorded in selling, general, and administrative expenses, and a credit of $84 was recorded in restructuring expense. |
Page 5 of 7
CULP, INC. FINANCIAL INFORMATION RELEASE | ||||||||||||||||||||
SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT | ||||||||||||||||||||
FOR THE SIX MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||||||||||||||
(Amounts in thousands) | ||||||||||||||||||||
SIX MONTHS ENDED (UNAUDITED) | ||||||||||||||||||||
Amounts | Percent of Total Sales | |||||||||||||||||||
November 2, | October 28, | % Over | November 2, | October 28, | ||||||||||||||||
Net Sales by Segment | 2008 | 2007 | (Under) | 2008 | 2007 | |||||||||||||||
Mattress Fabrics | $ | 63,610 | 72,546 | (12.3 | ) | % | 57.0 | % | 56.0 | % | ||||||||||
Upholstery Fabrics | 47,975 | 57,020 | (15.9 | ) | % | 43.0 | % | 44.0 | % | |||||||||||
Net Sales | $ | 111,585 | 129,566 | (13.9 | ) | % | 100.0 | % | 100.0 | % | ||||||||||
Gross Profit by Segment | Gross Profit Margin | |||||||||||||||||||
Mattress Fabrics | $ | 11,428 | 11,843 | (3.5 | ) | % | 18.0 | % | 16.3 | % | ||||||||||
Upholstery Fabrics | 2,347 | 6,742 | (65.2 | ) | % | 4.9 | % | 11.8 | % | |||||||||||
Subtotal | 13,775 | 18,585 | (25.9 | ) | % | 12.3 | % | 14.3 | % | |||||||||||
Restructuring related charges | (3,225 | ) | (1 | ) | (1,107 | ) | (3 | ) | 191.3 | % | (2.9 | ) | % | (0.9 | ) | % | ||||
Gross Profit | $ | 10,550 | 17,478 | (39.6 | ) | % | 9.5 | % | 13.5 | % | ||||||||||
Selling, General and Administrative expenses by Segment | Percent of Sales | |||||||||||||||||||
Mattress Fabrics | $ | 3,961 | 4,208 | (5.9 | ) | % | 6.2 | % | 5.8 | % | ||||||||||
Upholstery Fabrics | 4,565 | 6,092 | (25.1 | ) | % | 9.5 | % | 10.7 | % | |||||||||||
Unallocated Corporate expenses | 1,293 | 1,808 | (28.5 | ) | % | 1.2 | % | 1.4 | % | |||||||||||
Subtotal | 9,819 | 12,108 | (18.9 | ) | % | 8.8 | % | 9.3 | % | |||||||||||
Restructuring related charges | 4 | (1 | ) | 51 | (3 | ) | (92.2 | ) | % | 0.0 | % | 0.0 | % | |||||||
Selling, General and Administrative expenses | $ | 9,823 | 12,159 | (19.2 | ) | % | 8.8 | % | 9.4 | % | ||||||||||
Operating Income (loss) by Segment | Operating Income (Loss) Margin | |||||||||||||||||||
Mattress Fabrics | $ | 7,467 | 7,635 | (2.2 | ) | % | 11.7 | % | 10.5 | % | ||||||||||
Upholstery Fabrics | (2,218 | ) | 650 | (441.2 | ) | % | (4.6 | ) | % | 1.1 | % | |||||||||
Unallocated corporate expenses | (1,293 | ) | (1,808 | ) | (28.5 | ) | % | (1.2 | ) | % | (1.4 | ) | % | |||||||
Subtotal | 3,956 | 6,477 | (38.9 | ) | % | 3.5 | % | 5.0 | % | |||||||||||
Restructuring expense and restructuring related charges | (12,265 | ) | (2 | ) | (1,506 | ) | (4 | ) | N.M. | (11.0 | ) | % | (1.2 | ) | % | |||||
Operating (loss) income | $ | (8,309 | ) | 4,971 | N.M. | (7.4 | ) | % | 3.8 | % | ||||||||||
Depreciation by Segment | ||||||||||||||||||||
Mattress Fabrics | $ | 1,693 | 1,795 | (5.7 | ) | % | ||||||||||||||
Upholstery Fabrics | 940 | 1,097 | (14.3 | ) | % | |||||||||||||||
Subtotal | 2,633 | 2,892 | (9.0 | ) | % | |||||||||||||||
Accelerated depreciation | 2,090 | - | 100.0 | % | ||||||||||||||||
Total depreciation | 4,723 | 2,892 | 63.3 | % |
Notes: |
(1) The $3.2 million represents restructuring related charges of $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, and $27 for other operating costs associated with closed plant facilities. The $4 represents restructuring related charges for other operating costs associated with closed plant facilities. |
(2) The $12.3 million represents $7.8 million for write-downs of a building and equipment, $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, $776 for employee termination benefits, $447 for lease termination and other exit costs, and $31 for other operating costs associated with closed plant facilities. Of this total charge, $3.2 million, $4, and $9.0 million were recorded in cost of sales, selling, general, and administrative expenses, and restructuring expense, respectively. |
(3) The $1.1 million represents restructuring related charges of $703 for other operating costs associated with closed plant facilities and $404 for inventory markdowns. The $51 restructuring related charge represents other operating costs associated with closed plant facilities. |
(4) The $1.5 million represents $754 for other operating costs on closed plant facilities, $546 for lease termination and other exit costs, $404 for inventory markdowns, $388 for write-downs of buildings and equipment, $127 for asset movement costs, a credit of $315 for sales proceeds received on equipment with no carrying value, and a credit of $398 for employee termination benefits. Of this total charge, $1.1 million was recorded in cost of sales, $51 was recorded in selling, general, and administrative expenses, and $348 was recorded in restructuring expense. |
Page 6 of 7
CULP, INC. | ||||||||||||||||||||||||||||||||||||
PROFORMA CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||||||||||||||
FOR THE THREE MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||||||||||||||||||||||||||||||
(Amounts in Thousands) | ||||||||||||||||||||||||||||||||||||
THREE MONTHS ENDED | ||||||||||||||||||||||||||||||||||||
As | November 2, | As | October 28, | Proforma | ||||||||||||||||||||||||||||||||
November 2, | % of | % of | Proforma Net | % of | October 28, | % of | % of | Proforma Net | % of | % Over | ||||||||||||||||||||||||||
2008 | Sales | Adjustments | Sales | of Adjustments | Sales | 2007 | Sales | Adjustments | Sales | of Adjustments | Sales | (Under) | ||||||||||||||||||||||||
Net sales | $ | 52,263 | 100.0 | % | - | 52,263 | 100.0 | % | 64,336 | 100.0 | % | - | 64,336 | 100.0 | % | -18.8 | % | |||||||||||||||||||
Cost of sales | 49,115 | 94.0 | % | (3,213 | ) | -6.1 | % | (1 | ) | 45,902 | 87.8 | % | 55,914 | 86.9 | % | (591 | ) | -0.9 | % | (3 | ) | 55,323 | 86.0 | % | -17.0 | % | ||||||||||
Gross profit | 3,148 | 6.0 | % | (3,213 | ) | -6.1 | % | 6,361 | 12.2 | % | 8,422 | 13.1 | % | (591 | ) | -0.9 | % | 9,013 | 14.0 | % | -29.4 | % | ||||||||||||||
Selling, general and | ||||||||||||||||||||||||||||||||||||
administrative expenses | 4,439 | 8.5 | % | (2 | ) | 0.0 | % | (1 | ) | 4,437 | 8.5 | % | 5,838 | 9.1 | % | (25 | ) | 0.0 | % | (3 | ) | 5,813 | 9.0 | % | -23.7 | % | ||||||||||
Restructuring expense (credit) | 8,634 | 16.5 | % | (8,634 | ) | -16.5 | % | (2 | ) | - | 0.0 | % | (84 | ) | -0.1 | % | 84 | 0.1 | % | (4 | ) | - | 0.0 | % | 0.0 | % | ||||||||||
(Loss) income from operations | (9,925 | ) | -19.0 | % | (11,849 | ) | -22.7 | % | 1,924 | 3.7 | % | 2,668 | 4.1 | % | (532 | ) | -0.8 | % | 3,200 | 5.0 | % | -39.9 | % | |||||||||||||
Interest expense | 663 | 1.3 | % | - | 0.0 | % | 663 | 1.3 | % | 809 | 1.3 | % | - | 0.0 | % | 809 | 1.3 | % | -18.0 | % | ||||||||||||||||
Interest income | (21 | ) | 0.0 | % | - | 0.0 | % | (21 | ) | 0.0 | % | (63 | ) | -0.1 | % | - | 0.0 | % | (63 | ) | -0.1 | % | -66.7 | % | ||||||||||||
Other (income) expense | (250 | ) | -0.5 | % | - | 0.0 | % | (250 | ) | -0.5 | % | 463 | 0.7 | % | - | 0.0 | % | 463 | 0.7 | % | 154.0 | % | ||||||||||||||
(Loss) income before income taxes | (10,317 | ) | -19.7 | % | (11,849 | ) | -22.7 | % | (5 | ) | 1,532 | 2.9 | % | 1,459 | 2.3 | % | (532 | ) | -0.8 | % | (6 | ) | 1,991 | 3.1 | % | -23.1 | % |
Notes: |
(1) The $3.2 million restructuring related charge represents $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, and $15 for other operating costs associated with closed plant facilities. The $2 restructuring related charge represents other operating costs associated with closed plant facilities. |
(2)The $8.6 million represents $7.8 million for write-downs of a building and equipment, $460 for lease termination and other exit costs, and $362 for employee termination benefits. |
(3) The $591 restructuring related charge represents $348 for inventory markdowns and $243 for other operating costs associated with closed plant facilities. The $25 restructuring related charge represents other operating costs associated with closed plant facilities. |
(4)The $84 restructuring credit represents $179 for lease termination and other exit costs, $73 for asset movement costs, $27 for write-downs of buildings and equipment, a credit of $114 for proceeds received on equipment with no carrying value, and a credit of $249 for employee termination benefits. |
(5) Of this total charge, $839 and $11.0 million represent cash and non-cash charges, respectively. |
(6) Of this total charge, $158 and $374 represent cash and non-cash charges, respectively. |
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CULP, INC. | ||||||||||||||||||||||||||||||||||||
PROFORMA CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||||||||||||||
FOR THE SIX MONTHS ENDED NOVEMBER 2, 2008 AND OCTOBER 28, 2007 | ||||||||||||||||||||||||||||||||||||
(Amounts in Thousands) | ||||||||||||||||||||||||||||||||||||
SIX MONTHS ENDED | ||||||||||||||||||||||||||||||||||||
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As Reported | % of | % of | November 2, | % of | As Reported | % of | % of | October 28, | % of | Proforma | ||||||||||||||||||||||||||
2008 | Sales | Adjustments | Sales | Adjustments | Sales | 2007 | Sales | Adjustments | Sales | Adjustments | Sales | (Under) | ||||||||||||||||||||||||
Net sales | $ | 111,585 | 100.0 | % | - | 111,585 | 100.0 | % | 129,566 | 100.0 | % | - | 129,566 | 100.0 | % | -13.9 | % | |||||||||||||||||||
Cost of sales | 101,035 | 90.5 | % | (3,225 | ) | -2.9 | % | (1 | ) | 97,810 | 87.7 | % | 112,088 | 86.5 | % | (1,107 | ) | -0.9 | % | (3 | ) | 110,981 | 85.7 | % | -11.9 | % | ||||||||||
Gross profit | 10,550 | 9.5 | % | (3,225 | ) | -2.9 | % | 13,775 | 12.3 | % | 17,478 | 13.5 | % | (1,107 | ) | -0.9 | % | 18,585 | 14.3 | % | -25.9 | % | ||||||||||||||
Selling, general and | ||||||||||||||||||||||||||||||||||||
administrative expenses | 9,823 | 8.8 | % | (4 | ) | 0.0 | % | (1 | ) | 9,819 | 8.8 | % | 12,159 | 9.4 | % | (51 | ) | 0.0 | % | (3 | ) | 12,108 | 9.3 | % | -18.9 | % | ||||||||||
Restructuring expense | 9,036 | 8.1 | % | (9,036 | ) | -8.1 | % | (2 | ) | - | 0.0 | % | 348 | 0.3 | % | (348 | ) | -0.3 | % | (4 | ) | - | 0.0 | % | 0.0 | % | ||||||||||
(Loss) income from operations | (8,309 | ) | -7.4 | % | (12,265 | ) | -11.0 | % | 3,956 | 3.5 | % | 4,971 | 3.8 | % | (1,506 | ) | -1.2 | % | 6,477 | 5.0 | % | -38.9 | % | |||||||||||||
Interest expense | 1,095 | 1.0 | % | - | 0.0 | % | 1,095 | 1.0 | % | 1,627 | 1.3 | % | - | 0.0 | % | 1,627 | 1.3 | % | -32.7 | % | ||||||||||||||||
Interest income | (55 | ) | 0.0 | % | - | 0.0 | % | (55 | ) | 0.0 | % | (121 | ) | -0.1 | % | - | 0.0 | % | (121 | ) | -0.1 | % | -54.5 | % | ||||||||||||
Other (income) expense | (236 | ) | -0.2 | % | - | 0.0 | % | (236 | ) | -0.2 | % | 695 | 0.5 | % | - | 0.0 | % | 695 | 0.5 | % | 134.0 | % | ||||||||||||||
(Loss) income before income taxes | (9,113 | ) | -8.2 | % | (12,265 | ) | -11.0 | % | (5 | ) | 3,152 | 2.8 | % | 2,770 | 2.1 | % | (1,506 | ) | -1.2 | % | (6 | ) | 4,276 | 3.3 | % | -26.3 | % |
Notes: | |||
(1) | The $3.2 million represents restructuring related charges of $2.1 million for accelerated depreciation, $1.1 million for inventory markdowns, and $27 for other operating costs associated with closed plant facilities. The $4 represents restructuring related charges for other operating costs associated with closed plant facilities. | ||
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(2) | The $9.0 million represents $7.8 million for write-downs of a building and equipment, $776 for employee termination benefits, and $447 for lease termination and other exit costs. | ||
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(3) | The $1.1 million represents restructuring related charges of $703 for other operating costs associated with the closed plant facilities and $404 for inventory markdowns. The $51 restructuring related charge represents for other operating costs associated with closed plant facilities. | ||
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(4) | The $348 represents restructuring charges of $546 for lease termination and other exit costs, $388 for write-downs of buildings and equipment, $127 for asset movement costs, a credit of $315 for sales proceeds received on equipment with no carrying value, and a credit of $398 for employee termination benefits. | ||
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(5) | Of this total charge, $1.3 million and $11.0 million represent cash and non-cash charges, respectively. | ||
(6) | Of this total charge, $713 and $793 represent cash and non-cash charges, respectively. |