Culp (CULP) 8-K Results of Operations and Financial Condition

Exhibit 99(b)

Page 1 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF NET INCOME

FOR THREE MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011

(UNAUDITED)

(Amounts in Thousands, Except for Per Share Data)

	THREE MONTHS ENDED
	Amounts									Percent of Sales
	October 28,			October 30,			% Over			October 28,			October 30,
	2012			2011			(Under)			2012			2011
Net sales	$	65,560			58,013		13.0		%	100.0		%	100.0		%
Cost of sales		53,683			49,367		8.7		%	81.9		%	85.1		%
Gross profit		11,877			8,646		37.4		%	18.1		%	14.9		%
Selling, general and
administrative expenses		7,209			5,720		26.0		%	11.0		%	9.9		%
Income from operations		4,668			2,926		59.5		%	7.1		%	5.0		%
Interest expense		156			188		(17.0	)	%	0.2		%	0.3		%
Interest income		(96	)		(110	)	(12.7	)	%	(0.1	)	%	(0.2	)	%
Other expense (income)		76			(15	)	N.M.			0.1		%	(0.0	)	%
Income before income taxes		4,532			2,863		58.3		%	6.9		%	4.9		%
Income taxes*		(3,736	)		(3,389	)	10.2		%	(82.4	)	%	(118.4	)	%
Net income	$	8,268			6,252		32.2		%	12.6		%	10.8		%
Net income per share-basic	$	0.68		$	0.49		38.8		%
Net income per share-diluted	$	0.67		$	0.49		36.7		%
Average shares outstanding-basic		12,191			12,733		(4.3	)	%
Average shares outstanding-diluted		12,348			12,871		(4.1	)	%

PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	THREE MONTHS ENDED
	Amounts								Percent of Sales
	October 28,		October 30,		% Over				October 28,			October 30,
	2012		2011		(Under)				2012			2011
Income before income taxes (see above)	$	4,532		2,863		58.3		%		6.9	%		4.9	%
Adjusted Income taxes (2)*		680		515		32.0		%		15.0	%		18.0	%
Adjusted net income		3,852		2,348		64.1		%		5.9	%		4.0	%
Adjusted net income per share-basic	$	0.32	$	0.18		77.8		%
Adjusted net income per share-diluted	$	0.31	$	0.18		72.2		%
Average shares outstanding-basic		12,191		12,733		(4.3	)	%
Average shares outstanding-diluted		12,348		12,871		(4.1	)	%
(1) Culp, Inc. currently does not incur cash income tax expense in the US due to its $59.9 million in net operating loss carryforwards. Therefore,
adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 9 of 9.
(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 9 of 9.
* Percent of sales column for income taxes is calculated as a % of income before income taxes.

Page 2 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF NET INCOME

FOR THE SIX MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011

(UNAUDITED)

(Amounts in Thousands, Except for Per Share Data)

	SIX MONTHS ENDED
	Amounts										Percent of Sales
	October 28,			October 30,			% Over				October 28,				October 30,
	2012			2011			(Under)				2012				2011
Net sales	$	134,744			118,283			13.9		%		100.0		%		100.0		%
Cost of sales		109,746			100,759			8.9		%		81.4		%		85.2		%
Gross profit		24,998			17,524			42.7		%		18.6		%		14.8		%
Selling, general and
administrative expenses		14,850			11,477			29.4		%		11.0		%		9.7		%
Income from operations		10,148			6,047			67.8		%		7.5		%		5.1		%
Interest expense		346			409			(15.4	)	%		0.3		%		0.3		%
Interest income		(222	)		(238	)		(6.7	)	%		(0.2	)	%		(0.2	)	%
Other expense		121			49			146.9		%		0.1		%		0.0		%
Income before income taxes		9,903			5,827			70.0		%		7.3		%		4.9		%
Income taxes*		(1,889	)		(2,244	)		(15.8	)	%		(19.1	)	%		(38.5	)	%
Net income	$	11,792			8,071			46.1		%		8.8		%		6.8		%
Net income per share-basic	$	0.95		$	0.63			50.8		%
Net income per share-diluted	$	0.94		$	0.62			51.6		%
Average shares outstanding-basic		12,371			12,898			(4.1	)	%
Average shares outstanding-diluted		12,541			13,025			(3.7	)	%
PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	SIX MONTHS ENDED
	Amounts										Percent of Sales
	October 28,			October 30,			% Over				October 28,				October 30,
	2012			2011			(Under)				2012				2011
Income before income taxes (see above)	$	9,903			5,827			70.0		%		7.3		%		4.9		%
Adjusted Income taxes (2)*		1,485			1,049			41.6		%		15.0		%		18.0		%
Adjusted net income		8,418			4,778			76.2		%		6.2		%		4.0		%
Adjusted net income per share-basic	$	0.68		$	0.37			83.8		%
Adjusted net income per share-diluted	$	0.67		$	0.37			81.1		%
Average shares outstanding-basic		12,371			12,898			(4.1	)	%
Average shares outstanding-diluted		12,541			13,025			(3.7	)	%
(1) Culp, Inc. currently does not incur cash income tax expense in the US due to its $59.9 million in net operating loss carryforwards. Therefore,
adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 9 of 9.
(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 9 of 9.
* Percent of sales column for income taxes is calculated as a % of income before income taxes.

Page 3 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED BALANCE SHEETS
OCTOBER 28, 2012, OCTOBER 30, 2011 AND APRIL 29, 2012
Unaudited
(Amounts in Thousands)
		Amounts				Increase
		October 28,		October 30,		(Decrease)						* April 29,
		2012		2011		Dollars			Percent			2012
Current assets
Cash and cash equivalents		$	23,464		13,795		9,669			70.1	%		25,023
Short-term investments			5,241		10,482		(5,241	)		(50.0	) %		5,941
Accounts receivable			20,678		16,241		4,437			27.3	%		25,055
Inventories			38,261		33,776		4,485			13.3	%		36,373
Deferred income taxes			4,470		2,659		1,811			68.1	%		2,467
Assets held for sale			-		75		(75	)		(100.0	) %		15
Income taxes receivable			-		79		(79	)		(100.0	) %		-
Other current assets			1,640		1,602		38			2.4	%		1,989
Total current assets			93,754		78,709		15,045			19.1	%		96,863
	��
Property, plant & equipment, net			30,621		30,431		190			0.6	%		31,279
Goodwill			11,462		11,462		-			0.0	%		11,462
Deferred income taxes			4,738		4,540		198			4.4	%		3,205
Other assets			1,868		1,982		(114	)		(5.8	) %		1,907
Total assets		$	142,443		127,124		15,319			12.1	%		144,716
Current liabilities
Current maturities of long-term debt		$	2,401		2,401		-			0.0	%		2,404
Line of credit			875		-		875			100.0	%		889
Accounts payable - trade			23,219		21,689		1,530			7.1	%		30,663
Accounts payable - capital expenditures			104		112		(8	)		(7.1	) %		169
Accrued expenses			10,611		6,839		3,772			55.2	%		9,321
Accrued restructuring			-		40		(40	)		(100.0	) %		40
Income taxes payable - current			385		373		12			3.2	%		642
Total current liabilities			37,595		31,454		6,141			19.5	%		44,128
Income taxes payable - long-term			4,188		4,096		92			2.2	%		4,164
Deferred income taxes			856		659		197			29.9	%		705
Long-term debt , less current maturities			4,416		6,818		(2,402	)		(35.2	) %		6,719
Total liabilities			47,055		43,027		4,028			9.4	%		55,716
Shareholders' equity			95,388		84,097		11,291			13.4	%		89,000
Total liabilities and
shareholders' equity		$	142,443		127,124		15,319			12.1	%		144,716
Shares outstanding			12,209		12,767		(558	)		(4.4	) %		12,703
* Derived from audited financial statements.

Page 4 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX  MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011

Unaudited

(Amounts in Thousands)

	SIX MONTHS ENDED
	Amounts
	October 28,			October 30,
	2012			2011
Cash flows from operating activities:
Net income	$	11,792		$	8,071
Adjustments to reconcile net income  to net cash
provided by operating activities:
Depreciation		2,539			2,386
Amortization of other assets		119			127
Stock-based compensation		197			178
Excess tax benefit related to stock-based compensation		(60	)		(39	)
Deferred income taxes		(3,325	)		(3,280	)
Gain on sale of equipment		-			(128	)
Foreign currency exchange gains		(66	)		(164	)
Changes in assets and liabilities:
Accounts receivable		4,353			4,004
Inventories		(1,882	)		(4,964	)
Other current assets		373			750
Other assets		(80	)		(31	)
Accounts payable-trade		(7,397	)		(3,382	)
Accrued expenses		1,310			(754	)
Accrued restructuring		(40	)		(4	)
Income taxes		(183	)		(189	)
Net cash provided by operating activities		7,650			2,581
Cash flows from investing activities:
Capital expenditures		(1,946	)		(2,551	)
Proceeds from the sale of equipment		-			130
Purchase of short-term investments		(54	)		(4,789	)
Proceeds from the sale of short-term investments		795			2,032
Net cash used in investing activities		(1,205	)		(5,178	)
Cash flows from financing activities:
Proceeds from lines of credit		1,000			3,500
Payments on lines of credit		(1,000	)		(3,500	)
Payments on long-term debt		(2,300	)		(2,305	)
Proceeds from common stock issued		64			237
Common stock shares repurchased		(5,022	)		(4,776	)
Dividends paid		(747	)		-
Debt issance costs		-			(26	)
Excess tax benefit related to stock-based compensation		60			39
Net cash used in financing activities		(7,945	)		(6,831	)
Effect of exchange rate changes on cash and cash equivalents		(59	)		42
Decrease in cash and cash equivalents		(1,559	)		(9,386	)
Cash and cash equivalents at beginning of period		25,023			23,181
Cash and cash equivalents at end of period	$	23,464		$	13,795
Free Cash Flow (1)	$	5,705		$	241

(1)	Free Cash Flow reconciliation is as follows:
		FY 2013			FY 2012
A)	Net cash provided by operating activities	$	7,650		$	2,581
B)	Minus:  Capital Expenditures		(1,946	)		(2,551	)
C)	Add: Proceeds from the sale of equipment		-			130
D)	Add: Excess tax benefit related to stock-based compensation		60			39
E)	Effect of exchange rate changes on cash and cash equivalents		(59	)		42
		$	5,705		$	241

Page 5 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

STATEMENTS OF OPERATIONS BY SEGMENT

           FOR THE THREE MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011

        (Unaudited)

           (Amounts in thousands)

	THREE MONTHS ENDED
	Amounts										Percent of Total Sales
	October 28,			October 30,				% Over			October 28,				October 30,
Net Sales by Segment	2012			2011				(Under)			2012				2011
Mattress Fabrics	$	39,697			35,242				12.6	%		60.6		%		60.7	%
Upholstery Fabrics		25,863			22,771				13.6	%		39.4		%		39.3	%
Net Sales	$	65,560			58,013				13.0	%		100.0		%		100.0	%
Gross Profit by Segment											Gross Profit Margin
Mattress Fabrics	$	7,539			5,938				27.0	%		19.0		%		16.8	%
Upholstery Fabrics		4,338			2,785				55.8	%		16.8		%		12.2	%
Subtotal		11,877			8,723				36.2	%		18.1		%		15.0	%
Other non-recurring charges		-			(77	)	(1)		(100.0	) %		0.0		%		(0.1	) %
Gross Profit	$	11,877			8,646				37.4	%		18.1		%		14.9	%
Selling, General and Administrative expenses by Segment											Percent of Sales
Mattress Fabrics	$	2,424			2,132				13.7	%		6.1		%		6.0	%
Upholstery Fabrics		3,157			2,766				14.1	%		12.2		%		12.1	%
Unallocated Corporate expenses		1,628			822				98.1	%		2.5		%		1.4	%
Selling, General and Administrative expenses		7,209			5,720				26.0	%		11.0		%		9.9	%
Operating Income (loss)  by Segment											Operating Income (Loss) Margin
Mattress Fabrics	$	5,115			3,806				34.4	%		12.9		%		10.8	%
Upholstery Fabrics		1,181			19			N.M.				4.6		%		0.1	%
Unallocated corporate expenses		(1,628	)		(822	)			98.1	%		(2.5	)	%		(1.4	) %
Subtotal		4,668			3,003				55.4	%		7.1		%		5.2	%
Other non-recurring charges		-			(77	)	(1)		(100.0	) %		0.0		%		(0.1	) %
Operating income	$	4,668			2,926				59.5	%		7.1		%		5.0	%
Depreciation by Segment
Mattress Fabrics	$	1,127			1,054				6.9	%
Upholstery Fabrics		158			146				8.2	%
Subtotal		1,285			1,200				7.1	%
Notes:
(1) The $77 represents employee termination benefits associated with our Anderson, SC plant facility.

Page 6 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE
STATEMENTS OF OPERATIONS BY SEGMENT
FOR THE SIX MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011
(Unaudited)
(Amounts in thousands)
	SIX MONTHS ENDED
	Amounts													Percent of Total Sales
	October 28,					October 30,					% Over			October 28,			October 30,
Net Sales by Segment	2012					2011					(Under)			2012			2011
Mattress Fabrics	$	77,662					67,412					15.2	%		57.6	%		57.0	%
Upholstery Fabrics		57,082					50,871					12.2	%		42.4	%		43.0	%
Net Sales	$	134,744					118,283					13.9	%		100.0	%		100.0	%
Gross Profit by Segment														Gross Profit Margin
Mattress Fabrics	$	15,161					11,076					36.9	%		19.5	%		16.4	%
Upholstery Fabrics		9,837					6,525					50.8	%		17.2	%		12.8	%
Subtotal		24,998					17,601					42.0	%		18.6	%		14.9	%
Other non-recurring charges		-					(77	)	(1	)		(100.0	) %		0.0	%		(0.0	) %
Gross Profit		24,998					17,524					42.7	%		18.6	%		14.8	%
Selling, General and Administrative expenses  by Segment														Percent of Sales
Mattress Fabrics	$	4,814					4,123					16.8	%		6.2	%		6.1	%
Upholstery Fabrics		6,498					5,534					17.4	%		11.4	%		10.9	%
Unallocated Corporate expenses		3,538					1,820					94.4	%		2.6	%		1.5	%
Subtotal		14,850					11,477					29.4	%		11.0	%		9.7	%
Operating Income (loss)  by Segment														Operating Income (Loss) Margin
Mattress Fabrics	$	10,347					6,953					48.8	%		13.3	%		10.3	%
Upholstery Fabrics		3,339					991					236.9	%		5.8	%		1.9	%
Unallocated corporate expenses		(3,538	)				(1,820	)				94.4	%		(2.6	) %		(1.5	) %
Subtotal		10,148					6,124					65.7	%		7.5	%		5.2	%
Other non-recurring charges		-		(1	)		(77	)	(1	)		(100.0	) %		0.0	%		(0.1	) %
Operating income	$	10,148					6,047					67.8	%		7.5	%		5.1	%
Return on Capital (2)
Mattress Fabrics		37.4	%				25.8	%
Upholstery Fabrics		39.9	%				16.2	%
Unallocated Corporate		N/A					N/A
Consolidated		28.5	%				18.5	%
Capital Employed (3)
Mattress Fabrics		55,102					53,215					3.5	%
Upholstery Fabrics		16,728					13,209					26.6	%
Unallocated Corporate		(1,234	)				465					N/A
Consolidated		70,596					66,889					5.5	%
Depreciation by Segment
Mattress Fabrics	$	2,219					2,082					6.6	%
Upholstery Fabrics		320					304					5.3	%
Subtotal		2,539					2,386					6.4	%

Notes:

(1) The $77 represents employee termination benefits associated with our Anderson, SC plant facility.

(2) See pages 7 and 8 of this financial information  release for calculations.

(3) The capital employed balances are as of October 28, 2012 and October 30, 2011.

Page 7 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

RETURN ON CAPITAL EMPLOYED BY SEGMENT

FOR THE SIX MONTHS ENDED OCTOBER 28, 2012

(Amounts in Thousands)

(Unaudited)

	Operating Income
	Six Months						Return
	Ended			Average			on Avg.
	October 28, 2012 (1)			Capital Employed (3)			Capital Employed (2)
Mattress Fabrics	$	10,347		$	55,272			37.4	%
Upholstery Fabrics		3,339			16,738			39.9	%
(less: Unallocated Corporate)		(3,538	)		(789	)		N/A
Total	$	10,148		$	71,220			28.5	%
Average Capital Employed	As of the three Months Ended October 28, 2012												As of the three Months Ended July 29, 2012												As of the three Months Ended April 29, 2012
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		74,342			27,240			40,861			142,443			78,098			29,973			35,089			143,160			71,563			33,641			39,512			144,716
Total liabilities		(19,240	)		(10,512	)		(17,303	)		(47,055	)		(21,295	)		(11,006	)		(19,028	)		(51,329	)		(17,653	)		(19,123	)		(18,940	)		(55,716	)
Subtotal	$	55,102		$	16,728		$	23,558		$	95,388		$	56,803		$	18,967		$	16,061		$	91,831		$	53,910		$	14,518		$	20,572		$	89,000
Less:
Cash and cash equivalents		-			-			(23,464	)		(23,464	)		-			-			(21,889	)		(21,889	)		-			-			(25,023	)		(25,023	)
Short-term investments		-			-			(5,241	)		(5,241	)		-			-			(5,200	)		(5,200	)		-			-			(5,941	)		(5,941	)
Deferred income taxes - current		-			-			(4,470	)		(4,470	)		-			-			(2,337	)		(2,337	)		-			-			(2,467	)		(2,467	)
Deferred income taxes - non-current		-			-			(4,738	)		(4,738	)		-			-			(2,715	)		(2,715	)		-			-			(3,205	)		(3,205	)
Current maturities of long-term debt		-			-			2,401			2,401			-			-			2,400			2,400			-			-			2,404			2,404
Line of credit		-			-			875			875			-			-			834			834									889			889
Income taxes payable - current		-			-			385			385			-			-			751			751			-			-			642			642
Income taxes payable - long-term		-			-			4,188			4,188			-			-			4,131			4,131			-			-			4,164			4,164
Deferred income taxes - non-current		-			-			856			856			-			-			705			705			-			-			705			705
Long-term debt, less current maturities		-			-			4,416			4,416			-			-			6,666			6,666			-			-			6,719			6,719
Total Capital Employed	$	55,102		$	16,728		$	(1,234	)	$	70,596		$	56,803		$	18,967		$	(593	)	$	75,177		$	53,910		$	14,518		$	(541	)	$	67,887
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	55,272		$	16,738		$	(789	)	$	71,220

Notes:

(1) See reconciliation per page 6 of this financial information release.

(2) Return on average capital employed represents operating income for the six month period ending October 28, 2012 times two quarters

       to arrive at an annualized value then divided by average capital employed. Average capital employed does not include cash and cash equivalents,

       short-term investments, long-term debt, including current maturities, line of credit,  current and noncurrent deferred tax assets and liabilities, and

       income taxes payable.

(3) Average capital employed was computed using the three periods ending October 28, 2012, July 29, 2012 and April 29, 2012.

Page 8 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

RETURN ON CAPITAL EMPLOYED BY SEGMENT

FOR THE SIX MONTHS ENDED OCTOBER 30, 2011

(Amounts in Thousands)

(Unaudited)

	Operating Income
	Six Months						Return
	Ended			Average			on Avg.
	October 30, 2011 (1)			Capital Employed (3)			Capital Employed (2)
Mattress Fabrics	$	6,953		$	53,947			25.8	%
Upholstery Fabrics		991			12,234			16.2	%
(less: Unallocated Corporate)		(1,820	)		129			N/A
Total	$	6,124		$	66,310			18.5	%
Average Capital Employed	As of the three Months Ended October 30, 2011												As of the three Months Ended July 31, 2011												As of the three Months Ended May 1, 2011
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		68,568			24,462			34,094			127,124			71,325			26,683			31,299			129,307			66,637			25,929			37,485			130,051
Total liabilities		(15,353	)		(11,253	)		(16,421	)		(43,027	)		(15,331	)		(13,507	)		(19,118	)		(47,956	)		(14,005	)		(15,612	)		(20,093	)		(49,710	)
Subtotal	$	53,215		$	13,209		$	17,673		$	84,097		$	55,994		$	13,176		$	12,181		$	81,351		$	52,632		$	10,317		$	17,392		$	80,341
Less:
Cash and cash equivalents		-			-			(13,795	)		(13,795	)		-			-			(14,570	)		(14,570	)		-			-			(23,181	)		(23,181	)
Short-term investments		-			-			(10,482	)		(10,482	)		-			-			(10,443	)		(10,443	)		-			-			(7,699	)		(7,699	)
Deferred income taxes - current		-			-			(2,659	)		(2,659	)		-			-			(1,237	)		(1,237	)		-			-			(293	)		(293	)
Income taxes receivable		-			-			(79	)		(79	)		-			-			(79	)		(79	)		-			-			(79	)		(79	)
Deferred income taxes - non-current		-			-			(4,540	)		(4,540	)		-			-			(2,191	)		(2,191	)		-			-			(3,606	)		(3,606	)
Current maturities of long-term debt		-			-			2,401			2,401			-			-			2,409			2,409			-			-			2,412			2,412
Deferred income taxes - current								-			-									82			82									82			82
Income taxes payable - current		-			-			373			373			-			-			345			345			-			-			646			646
Income taxes payable - long-term		-			-			4,096			4,096			-			-			4,178			4,178			-			-			4,167			4,167
Deferred income taxes - non-current		-			-			659			659			-			-			596			596			-			-			596			596
Long-term debt, less current maturities		-			-			6,818			6,818			-			-			9,079			9,079			-			-			9,135			9,135
Total Capital Employed	$	53,215		$	13,209		$	465		$	66,889		$	55,994		$	13,176		$	350		$	69,520		$	52,632		$	10,317		$	(428	)	$	62,521
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	53,947		$	12,234		$	129		$	66,310

Notes:

(1) See reconciliation per page 6 of this financial information release.

(2) Return on average capital employed represents operating income for the six month period ending October 30, 2011 times 2

       to arrive at an annualized value then divided by average capital employed. Average capital employed does not include cash and cash equivalents,

       short-term investments, long-term debt, including current maturities, current and noncurrent deferred tax assets and liabilities, income taxes payable,

       and income taxes receivable.

(3) Average capital employed was computed using the three periods ending May 1, 2011, July 31, 2011, and October 30, 2011.

Page 9 of 9

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED ADJUSTED EFFECTIVE INCOME TAX RATE, NET INCOME AND EARNINGS PER SHARE

FOR THE SIX MONTHS ENDED OCTOBER 28, 2012 AND OCTOBER 30, 2011

Unaudited

(Amounts in Thousands)

			SIX MONTHS ENDED
			Amounts
			October 28,			October 30,
			2012			2011
Consolidated Effective GAAP Income Tax Rate	(1	)		(19.1	)%		(38.5	)%
Reduction of U.S. Valuation Allowance				123.0	%		74.9	%
Undistributed earnings from foreign subsidiaries				(66.5	)%		-
Non-Cash U.S. Income Tax Expense				(20.4	)%		(17.3	)%
Non-Cash Foreign Income Tax Expense				(2.0	)%		(1.1	)%
Consolidated Adjusted Effective Income Tax Rate	(2	)		15.0	%		18.0	%

	THREE MONTHS ENDED
	As reported						October 28, 2012		As reported						October 30, 2011
	October 28,						Proforma Net		October 30,						Proforma Net
	2012			Adjustments			of Adjustments		2011			Adjustments			of Adjustments
Income before income taxes	$	4,532		$	-		$	4,532	$	2,863					$	2,863
Income taxes (3)		(3,736	)	$	4,416			680		(3,389	)	$	3,904			515
Net income	$	8,268		$	(4,416	)	$	3,852	$	6,252		$	(3,904	)	$	2,348
Net income per share-basic	$	0.68		$	0.36		$	0.32	$	0.49		$	0.31		$	0.18
Net income per share-diluted	$	0.67		$	0.36		$	0.31	$	0.49		$	0.30		$	0.18
Average shares outstanding-basic		12,191			12,191			12,191		12,733			12,733			12,733
Average shares outstanding-diluted		12,348			12,348			12,348		12,871			12,871			12,871
	SIX MONTHS ENDED
	As reported						October 28, 2012		As reported						October 30, 2011
	October 28,						Proforma Net		October 30,						Proforma Net
	2012			Adjustments			of Adjustments		2011			Adjustments			of Adjustments
Income before income taxes	$	9,903		$	-		$	9,903	$	5,827		$	-		$	5,827
Income taxes (3)		(1,889	)	$	3,374			1,485		(2,244	)	$	3,293			1,049
Net income	$	11,792		$	(3,374	)	$	8,418	$	8,071		$	(3,293	)	$	4,778
Net income per share-basic	$	0.95		$	0.27		$	0.68	$	0.63		$	0.26		$	0.37
Net income per share-diluted	$	0.94		$	0.27		$	0.67	$	0.62		$	0.25		$	0.37
Average shares outstanding-basic		12,371			12,371			12,371		12,898			12,898			12,898
Average shares outstanding-diluted		12,541			12,541			12,541		13,025			13,025			13,025

(1) Calculated by dividing consolidated income benefit expense by consolidated income before income taxes.

(2) Represents estimated cash income tax expense for our subsidiaries located in Canada and China divided by consolidated income before income taxes.

(3) Proforma taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.