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

Exhibit 99(b)

Page 1 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF NET INCOME
FOR THREE MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
(UNAUDITED)
(Amounts in Thousands, Except for Per Share Data)
	THREE MONTHS ENDED
	Amounts									Percent of Sales
	November 1,			November 2,			% Over			November 1,			November 2,
	2015			2014			(Under)			2015			2014
Net sales	$	76,956			73,991			4.0	%		100.0	%		100.0	%
Cost of sales		61,223			61,713			(0.8	)%		79.6	%		83.4	%
Gross profit		15,733			12,278			28.1	%		20.4	%		16.6	%
Selling, general and
administrative expenses		9,433			7,379			27.8	%		12.3	%		10.0	%
Income from operations		6,300			4,899			28.6	%		8.2	%		6.6	%
Interest income		(69	)		(153	)		(54.9	)%		(0.1	)%		(0.2	)%
Other expense		225			162			38.9	%		0.3	%		0.2	%
Income before income taxes		6,144			4,890			25.6	%		8.0	%		6.6	%
Income taxes*		2,373			1,889			25.6	%		38.6	%		38.6	%
Net income	$	3,771			3,001			25.7	%		4.9	%		4.1	%
Net income per share-basic	$	0.31		$	0.25			24.0	%
Net income per share-diluted	$	0.30		$	0.24			25.0	%
Average shares outstanding-basic		12,343			12,218			1.0	%
Average shares outstanding-diluted		12,484			12,401			0.7	%

PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	THREE MONTHS ENDED
	Amounts							Percent of Sales
	November 1,		November 2,		% Over			November 1,			November 2,
	2015		2014		(Under)			2015			2014
Income before income taxes (see above)	$	6,144		4,890		25.6	%		8.0	%		6.6	%
Adjusted Income taxes (2)*		965		787		22.6	%		15.7	%		16.1	%
Adjusted net income		5,179		4,103		26.2	%		6.7	%		5.5	%
Adjusted net income per share-basic	$	0.42	$	0.34		23.5	%
Adjusted net income per share-diluted	$	0.41	$	0.33		24.2	%
Average shares outstanding-basic		12,343		12,218		1.0	%
Average shares outstanding-diluted		12,484		12,401		0.7	%
(1) Culp, Inc. currently does not incur cash income tax expense in the US due to its $32.2 million in net operating loss carryforwards as of May 3, 2015. Therefore,
adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on
page 10 of 10.
(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 10 of 10.
* Percent of sales column for income taxes is calculated as a % of income before income taxes.

Page 2 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF NET INCOME
FOR THE SIX MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
(UNAUDITED)
(Amounts in Thousands, Except for Per Share Data)
	SIX MONTHS ENDED
	Amounts									Percent of Sales
	November 1,			November 2,			% Over			November 1,			November 2,
	2015			2014			(Under)			2015			2014
Net sales	$	157,141			150,051			4.7	%		100.0	%		100.0	%
Cost of sales		125,206			125,058			0.1	%		79.7	%		83.3	%
Gross profit		31,935			24,993			27.8	%		20.3	%		16.7	%
Selling, general and
administrative expenses		18,175			14,798			22.8	%		11.6	%		9.9	%
Income from operations		13,760			10,195			35.0	%		8.8	%		6.8	%
Interest expense		-			67			(100.0	)%		0.0	%		0.0	%
Interest income		(112	)		(294	)		(61.9	)%		(0.1	)%		(0.2	)%
Other expense		320			73			338.4	%		0.2	%		0.0	%
Income before income taxes		13,552			10,349			30.9	%		8.6	%		6.9	%
Income taxes*		5,081			4,003			26.9	%		37.5	%		38.7	%
Net income	$	8,471			6,346			33.5	%		5.4	%		4.2	%
Net income per share-basic	$	0.69		$	0.52			32.7	%
Net income per share-diluted	$	0.68		$	0.51			33.3	%
Average shares outstanding-basic		12,310			12,215			0.8	%
Average shares outstanding-diluted		12,481			12,403			0.6	%

PRESENTATION OF ADJUSTED NET INCOME, ADJUSTED INCOME TAXES AND EARNINGS PER SHARE (1)
	SIX MONTHS ENDED
	Amounts							Percent of Sales
	November 1,		November 2,		% Over			November 1,			November 2,
	2015		2014		(Under)			2015			2014
Income before income taxes (see above)	$	13,552		10,349		30.9	%		8.6	%		6.9	%
Adjusted Income taxes (2)*		2,128		1,666		27.7	%		15.7	%		16.1	%
Adjusted net income		11,424		8,683		31.6	%		7.3	%		5.8	%
Adjusted net income per share-basic	$	0.93	$	0.71		31.0	%
Adjusted net income per share-diluted	$	0.92	$	0.70		31.4	%
Average shares outstanding-basic		12,310		12,215		0.8	%
Average shares outstanding-diluted		12,481		12,403		0.6	%
(1) Culp, Inc. currently does not incur cash income tax expense in the US due to its $32.2 million in net operating loss carryforwards as of May 3, 2015. Therefore,
adjusted net income is calculated using only income tax expense for our subsidiaries located in Canada and China. See reconciliation on
page 10 of 10.
(2) Represents estimated income tax expense for our subsidiaries located in Canada and China. See reconciliation on page 10 of 10.
* Percent of sales column for income taxes is calculated as a % of income before income taxes.

Page 3 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED BALANCE SHEETS
NOVEMBER 1, 2015, NOVEMBER 2, 2014, AND MAY 3, 2015
Unaudited
(Amounts in Thousands)
	Amounts				Increase
	November 1,		November 2,		(Decrease)						* May 3,
	2015		2014		Dollars			Percent			2015
Current assets
Cash and cash equivalents	$	31,176		28,953		2,223			7.7	%		29,725
Short-term investments		6,320		6,318		2			0.0	%		10,004
Accounts receivable		23,314		25,045		(1,731	)		(6.9	)%		28,749
Inventories		46,479		38,228		8,251			21.6	%		42,484
Deferred income taxes		7,754		6,191		1,563			25.2	%		4,790
Income taxes receivable		75		-		75			100.0	%		229
Other current assets		2,614		2,303		311			13.5	%		2,440
Total current assets		117,732		107,038		10,694			10.0	%		118,421
Property, plant & equipment, net		38,319		33,204		5,115			15.4	%		36,078
Goodwill		11,462		11,462		-			0.0	%		11,462
Deferred income taxes		382		508		(126	)		(24.8	)%		447
Long-term Investments		3,279		1,911		1,368			71.6	%		2,415
Other assets		2,494		2,539		(45	)		(1.8	)%		2,545
Total assets	$	173,668		156,662		17,006			10.9	%		171,368
Current liabilities
Current maturities of long-term debt	$	-		2,200		(2,200	)		(100.0	)%		2,200
Accounts payable - trade		25,221		25,450		(229	)		(0.9	)%		28,414
Accounts payable - capital expenditures		1,269		178		1,091			612.9	%		990
Accrued expenses		9,895		7,723		2,172			28.1	%		11,129
Income taxes payable - current		305		268		37			13.8	%		325
Total current liabilities		36,690		35,819		871			2.4	%		43,058
Income taxes payable - long-term		3,655		3,980		(325	)		(8.2	)%		3,792
Deferred income taxes		5,927		1,395		4,532			324.9	%		1,050
Deferred compensation		4,421		3,794		627			16.5	%		4,041
Total liabilities		50,693		44,988		5,705			12.7	%		51,941
Shareholders' equity		122,975		111,674		11,301			10.1	%		119,427
Total liabilities and
shareholders' equity	$	173,668		156,662		17,006			10.9	%		171,368
Shares outstanding		12,350		12,219		131			1.1	%		12,219
* Derived from audited financial statements.

Page 4 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
Unaudited
(Amounts in Thousands)
	SIX MONTHS ENDED
	Amounts
	November 1,			November 2,
	2015			2014
Cash flows from operating activities:
Net income	$	8,471			6,346
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation		3,184			2,812
Amortization of other assets		86			94
Stock-based compensation		1,339			291
Deferred income taxes		2,816			2,061
Gain on sale of equipment		(60	)		(35	)
Realized loss on sale of short-term investments		56			-
Excess tax benefits related to stock-based compensation		(838	)		(108	)
Foreign currency exchange gains		(13	)		(171	)
Changes in assets and liabilities:
Accounts receivable		4,892			2,360
Inventories		(4,135	)		2,467
Other current assets		(302	)		34
Other assets		8			(36	)
Accounts payable		(2,921	)		(1,275	)
Accrued expenses and deferrred compensation		(1,547	)		(324	)
Income taxes		168			22
Net cash provided by operating activities		11,204			14,538
Cash flows from investing activities:
Capital expenditures		(5,255	)		(5,087	)
Proceeds from the sale of equipment		225			391
Proceeds from life insurance policies		-			320
Proceeds from the sale of short-term investments		3,612			1,628
Purchase of short-term investments		(46	)		(1,675	)
Purchase of long-term investments		(864	)		(1,146	)
Net cash used in investing activities		(2,328	)		(5,569	)
Cash flows from financing activities:
Payments on line of credit		-			(538	)
Payments on long-term debt		(2,200	)		(2,200	)
Repurchase of common stock		-			(745	)
Dividends paid		(6,417	)		(6,113	)
Payments on debt issuance costs		(43	)		-
Proceeds from common stock issued		126			89
Excess tax benefits related to stock-based compensation		838			108
Net cash used in financing activities		(7,696	)		(9,399	)
Effect of exchange rate changes on cash and cash equivalents		271			80
Increase (decrease) in cash and cash equivalents		1,451			(350	)
Cash and cash equivalents at beginning of period		29,725			29,303
Cash and cash equivalents at end of period	$	31,176			28,953
Free Cash Flow (1)	$	6,419			9,204

(1) Free Cash Flow reconciliation is as follows:
			FY 2016			FY 2015
A	)	Net cash provided by operating activities	$	11,204			14,538
B	)	Minus:  Capital Expenditures		(5,255	)		(5,087	)
C	)	Add:     Proceeds from the sale of equipment		225			391
D	)	Add:     Proceeds from life insurance policies		-			320
E	)	Add:     Excess tax benefits related to stock-based compensation		838			108
F	)	Minus:  Purchase of long-term investments		(864	)		(1,146	)
G	)	Effects of exchange rate changes on cash and cash equivalents		271			80
			$	6,419			9,204

Page 5 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
STATEMENTS OF OPERATIONS BY SEGMENT
FOR THE THREE MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
(Unaudited)
(Amounts in thousands)
	THREE MONTHS ENDED
	Amounts									Percent of Total Sales
	November 1,			November 2,			% Over			November 1,			November 2,
Net Sales by Segment	2015			2014			(Under)			2015			2014
Mattress Fabrics	$	45,436			43,038			5.6	%		59.0	%		58.2	%
Upholstery Fabrics		31,520			30,953			1.8	%		41.0	%		41.8	%
Net Sales	$	76,956			73,991			4.0	%		100.0	%		100.0	%
Gross Profit by Segment										Gross Profit Margin
Mattress Fabrics	$	9,456			7,324			29.1	%		20.8	%		17.0	%
Upholstery Fabrics		6,277			4,954			26.7	%		19.9	%		16.0	%
Gross Profit	$	15,733			12,278			28.1	%		20.4	%		16.6	%
Selling, General and Administrative Expenses by Segment											Percent of Sales
Mattress Fabrics	$	2,989			2,592			15.3	%		6.6	%		6.0	%
Upholstery Fabrics		3,813			3,285			16.1	%		12.1	%		10.6	%
Unallocated Corporate expenses		2,631			1,502			75.2	%		3.4	%		2.0	%
Selling, General and Administrative Expenses	$	9,433			7,379			27.8	%		12.3	%		10.0	%
Operating Income (loss) by Segment										Operating Income (Loss) Margin
Mattress Fabrics	$	6,467			4,733			36.6	%		14.2	%		11.0	%
Upholstery Fabrics		2,464			1,668			47.7	%		7.8	%		5.4	%
Unallocated corporate expenses		(2,631	)		(1,502	)		75.2	%		(3.4	) %		(2.0	) %
Operating income	$	6,300			4,899			28.6	%		8.2	%		6.6	%
Depreciation by Segment
Mattress Fabrics	$	1,424			1,230			15.8	%
Upholstery Fabrics		205			184			11.4	%
Depreciation	$	1,629			1,414			15.2	%

Page 6 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
STATEMENTS OF OPERATIONS BY SEGMENT
FOR THE SIX MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
(Unaudited)
(Amounts in thousands)
	SIX MONTHS ENDED
	Amounts									Percent of Total Sales
	November 1,			November 2,			% Over			November 1,			November 2,
Net Sales by Segment	2015			2014			(Under)			2015			2014
Mattress Fabrics	$	93,245			85,860			8.6	%		59.3	%		57.2	%
Upholstery Fabrics		63,896			64,191			(0.5	) %		40.7	%		42.8	%
Net Sales	$	157,141			150,051			4.7	%		100.0	%		100.0	%
Gross Profit by Segment										Gross Profit Margin
Mattress Fabrics	$	19,381			14,527			33.4	%		20.8	%		16.9	%
Upholstery Fabrics		12,554			10,466			20.0	%		19.6	%		16.3	%
Gross Profit	$	31,935			24,993			27.8	%		20.3	%		16.7	%
Selling, General and Administrative Expenses by Segment										Percent of Sales
Mattress Fabrics	$	5,912			5,166			14.4	%		6.3	%		6.0	%
Upholstery Fabrics		7,409			6,737			10.0	%		11.6	%		10.5	%
Unallocated Corporate expenses		4,854			2,895			67.7	%		3.1	%		1.9	%
Selling, General, and Administrative Expenses	$	18,175			14,798			22.8	%		11.6	%		9.9	%
Operating Income (loss)  by Segment										Operating Income (Loss) Margin
Mattress Fabrics	$	13,468			9,361			43.9	%		14.4	%		10.9	%
Upholstery Fabrics		5,146			3,729			38.0	%		8.1	%		5.8	%
Unallocated corporate expenses		(4,854	)		(2,895	)		67.7	%		(3.1	) %		(1.9	)%
Operating income	$	13,760			10,195			35.0	%		8.8	%		6.8	%
Return on Capital (1)
Mattress Fabrics		37.9	%		29.8	%
Upholstery Fabrics		61.7	%		42.6	%
Unallocated Corporate		N/A			N/A
Consolidated		31.5	%		25.2	%
Capital Employed (2)
Mattress Fabrics		71,502			62,874			13.7	%
Upholstery Fabrics		17,058			16,069			6.2	%
Unallocated Corporate		(263	)		487			N/A
Consolidated		88,297			79,430			11.2	%
Depreciation by Segment
Mattress Fabrics	$	2,783			2,448			13.7	%
Upholstery Fabrics		401			364			10.2	%
Depreciation	$	3,184			2,812			13.2	%

Notes:

(1) See pages 8 and 9 of this financial information release for calculations.

(2) The capital employed balances are as of November 1, 2015 and November 2, 2014.

Page 7 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE
CONSOLIDATED STATEMENTS OF ADJUSTED EBITDA
FOR THE TWELVE MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014
(UNAUDITED)
(AMOUNTS IN THOUSANDS)
	Quarter Ended
													Trailing 12
													Months
	2/1/2015			5/3/2015			8/2/2015			11/1/2015			11/1/2015
Net income	$	3,812		$	4,913		$	4,701		$	3,771		$	17,197
Income taxes		2,110			1,772			2,707			2,373			8,962
Interest income, net		(202	)		(128	)		(42	)		(69	)		(441	)
Depreciation and amortization expense		1,478			1,576			1,602			1,668			6,324
Stock based compensation		191			304			265			1,074			1,834
Adjusted EBITDA	$	7,389		$	8,437		$	9,233		$	8,817		$	33,876
	Quarter Ended
													Trailing 12
													Months
	1/26/2014			4/27/2014			8/3/2014			11/2/2014			11/2/2014
Net income	$	8,381		$	2,740		$	3,344		$	3,001		$	17,466
Income taxes		(3,807	)		1,380			2,115			1,889			1,577
Interest income, net		(57	)		(43	)		(74	)		(153	)		(327	)
Depreciation and amortization expense		1,370			1,394			1,446			1,460			5,670
Stock based compensation		175			159			46			245			625
Adjusted EBITDA	$	6,062		$	5,630		$	6,877		$	6,442		$	25,011
% Over (Under)		21.9	%		49.9	%		34.3	%		36.9	%		35.4	%

Page 8 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

RETURN ON CAPITAL EMPLOYED BY SEGMENT

FOR THE SIX MONTHS ENDED NOVEMBER 1, 2015

(Amounts in Thousands)

(Unaudited)

	Operating Income
	Six Months			Average			Return on
	Ended			Capital			Avg. Capital
	November 1, 2015 (1)			Employed (3)			Employed (2)
Mattress Fabrics	$	13,468		$	71,108			37.9	%
Upholstery Fabrics		5,146			16,677			61.7	%
(less: Unallocated Corporate)		(4,854	)		(413	)		N/A
Total	$	13,760		$	87,372			31.5	%

Average Capital Employed	As of the three Months Ended November 1, 2015												As of the three Months Ended August 2, 2015												As of the three Months Ended May 3, 2015
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		90,730			32,187			50,751			173,668			91,614			33,795			44,463			169,872			89,066			32,838			49,464			171,368
Total liabilities		(19,228	)		(15,129	)		(16,336	)		(50,693	)		(20,265	)		(14,849	)		(16,033	)		(51,147	)		(18,594	)		(18,812	)		(14,535	)		(51,941	)
Subtotal	$	71,502		$	17,058		$	34,415		$	122,975		$	71,349		$	18,946		$	28,430		$	118,725		$	70,472		$	14,026		$	34,929		$	119,427
Less:
Cash and cash equivalents		-			-			(31,176	)		(31,176	)		-			-			(25,933	)		(25,933	)		-			-			(29,725	)		(29,725	)
Short-term investments		-			-			(6,320	)		(6,320	)		-			-			(6,336	)		(6,336	)		-			-			(10,004	)		(10,004	)
Long-term investments		-			-			(3,279	)		(3,279	)		-			-			(2,893	)		(2,893	)		-			-			(2,415	)		(2,415	)
Income taxes receivable		-			-			(75	)		(75	)		-			-			(142	)		(142	)		-			-			(229	)		(229	)
Deferred income taxes - current		-			-			(7,754	)		(7,754	)		-			-			(6,986	)		(6,986	)		-			-			(4,790	)		(4,790	)
Deferred income taxes - non-current		-			-			(382	)		(382	)		-			-			(412	)		(412	)		-			-			(447	)		(447	)
Current maturities of long-term debt		-			-			-			-			-			-			2,200			2,200			-			-			2,200			2,200
Income taxes payable - current		-			-			305			305			-			-			392			392			-			-			325			325
Income taxes payable - long-term		-			-			3,655			3,655			-			-			3,634			3,634			-			-			3,792			3,792
Deferred income taxes - non-current		-			-			5,927			5,927			-			-			4,064			4,064			-			-			1,050			1,050
Deferred compensation		-			-			4,421			4,421			-			-			4,280			4,280			-			-			4,041			4,041
Total Capital Employed	$	71,502		$	17,058		$	(263	)	$	88,297		$	71,349		$	18,946		$	298		$	90,593		$	70,472		$	14,026		$	(1,273	)	$	83,225
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	71,108		$	16,677		$	(413	)	$	87,372

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 November 1, 2015 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 investments, current maturities of long-term debt, current and noncurrent deferred tax assets and liabilities,

income taxes receivable and payable, and deferred compensation.

(3) Average capital employed was computed using the three periods ending November 1, 2015, August 2, 2015 and May 3, 2015.

Page 9 of 10

               CULP, INC. FINANCIAL INFORMATION RELEASE

                RETURN ON CAPITAL EMPLOYED BY SEGMENT

                FOR THE SIX MONTHS ENDED NOVEMBER 2, 2014

                               (Amounts in Thousands)

                                              (Unaudited)

	Operating Income
	Six Months			Average		Return on
	Ended			Capital		Avg. Capital
	November 2, 2014 (1)			Employed (3)		Employed (2)
Mattress Fabrics	$	9,361		$	62,756		29.8	%
Upholstery Fabrics		3,729			17,513		42.6	%
(less: Unallocated Corporate)		(2,895	)		603		N/A
Total	$	10,195		$	80,872		25.2	%

Average Capital Employed	As of the three Months Ended November 2, 2014												As of the three Months Ended August 3, 2014												As of the three Months Ended April 27, 2014
	Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated						Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total			Fabrics			Fabrics			Corporate			Total
Total assets		80,121			30,916			45,625			156,662			81,400			30,520			42,292			154,212			79,055			34,987			46,893			160,935
Total liabilities		(17,247	)		(14,847	)		(12,894	)		(44,988	)		(18,464	)		(11,468	)		(15,133	)		(45,065	)		(16,598	)		(17,568	)		(15,025	)		(49,191	)
Subtotal	$	62,874		$	16,069		$	32,731		$	111,674		$	62,936		$	19,052		$	27,159		$	109,147		$	62,457		$	17,419		$	31,868		$	111,744
Less:
Cash and cash equivalents		-			-			(28,953	)		(28,953	)		-			-			(24,665	)		(24,665	)		-			-			(29,303	)		(29,303	)
Short-term investments		-			-			(6,318	)		(6,318	)		-			-			(6,311	)		(6,311	)		-			-			(6,294	)		(6,294	)
Long-term investments		-			-			(1,911	)		(1,911	)		-			-			(1,749	)		(1,749	)		-			-			(765	)		(765	)
Income taxes receivable		-			-			-			-			-			-			(136	)		(136	)		-			-			(121	)		(121	)
Deferred income taxes - current		-			-			(6,191	)		(6,191	)		-			-			(6,203	)		(6,203	)		-			-			(6,230	)		(6,230	)
Deferred income taxes - non-current		-			-			(508	)		(508	)		-			-			(973	)		(973	)		-			-			(2,040	)		(2,040	)
Current maturities of long-term debt		-			-			2,200			2,200			-			-			2,200			2,200			-			-			2,200			2,200
Line of credit		-			-			-			-			-			-			569			569			-			-			586			586
Income taxes payable - current		-			-			268			268			-			-			387			387			-			-			442			442
Income taxes payable - long-term		-			-			3,980			3,980			-			-			4,037			4,037			-			-			3,962			3,962
Deferred income taxes - non-current		-			-			1,395			1,395			-			-			1,013			1,013			-			-			1,013			1,013
Deferred compensation		-			-			3,794			3,794			-			-			3,632			3,632			-			-			2,644			2,644
Long-term debt, less current maturities		-			-			-			-			-			-			2,200			2,200			-			-			2,200			2,200
Total Capital Employed	$	62,874		$	16,069		$	487		$	79,430		$	62,936		$	19,052		$	1,160		$	83,148		$	62,457		$	17,419		$	162		$	80,038
	Mattress			Upholstery			Unallocated
	Fabrics			Fabrics			Corporate			Total
Average Capital Employed (3)	$	62,756		$	17,513		$	603		$	80,872

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 November 2, 2014 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 investments, long-term debt, including current maturities, line of credit,  current and noncurrent deferred tax assets and liabilities,

       income taxes payable and receivable, and deferred compensation.

(3)  Average capital employed was computed using the three periods ending November 2, 2014, August 3, 2014 and April 27, 2014.

Page 10 of 10

CULP, INC. FINANCIAL INFORMATION RELEASE

CONSOLIDATED ADJUSTED EFFECTIVE INCOME TAX RATE, NET INCOME AND EARNINGS PERSHARE

FOR THE SIX MONTHS ENDED NOVEMBER 1, 2015 AND NOVEMBER 2, 2014

(Unaudited)

(Amounts in Thousands)

			SIX MONTHS ENDED
			Amounts
			November 1,			November 2,
			2015			2014
Consolidated Effective GAAP Income Tax Rate	(1	)		37.5	%		38.7	%
Non-Cash U.S. Income Tax Expense				(21.5	)%		(21.9	)%
Non-Cash Foreign Income Tax Expense				(0.3	)%		(0.7	)%
Consolidated Adjusted Effective Income Tax Rate	(2	)		15.7	%		16.1	%

	THREE MONTHS ENDED
	As reported					November 1, 2015		As reported					November 2, 2014
	November 1,					Proforma Net		November 2,					Proforma Net
	2015		Adjustments			of Adjustments		2014		Adjustments			of Adjustments
Income before income taxes	$	6,144	$	-		$	6,144	$	4,890				$	4,890
Income taxes (3)		2,373	$	(1,408	)		965		1,889	$	(1,102	)		787
Net income	$	3,771	$	1,408		$	5,179	$	3,001	$	1,102		$	4,103
Net income per share-basic	$	0.31	$	0.11		$	0.42	$	0.25	$	0.09		$	0.34
Net income per share-diluted	$	0.30	$	0.11		$	0.41	$	0.24	$	0.09		$	0.33
Average shares outstanding-basic		12,343		12,343			12,343		12,218		12,218			12,218
Average shares outstanding-diluted		12,484		12,484			12,484		12,401		12,401			12,401
	SIX MONTHS ENDED
	As reported					November 1, 2015		As reported					November 2, 2014
	November 1,					Proforma Net		November 2,					Proforma Net
		2015	Adjustments			of Adjustments			2014	Adjustments			of Adjustments
Income before income taxes	$	13,552	$	-		$	13,552	$	10,349	$	-		$	10,349
Income taxes (3)		5,081	$	(2,953	)		2,128		4,003	$	(2,337	)		1,666
Net income	$	8,471	$	2,953		$	11,424	$	6,346	$	2,337		$	8,683
Net income per share-basic	$	0.69	$	0.24		$	0.93	$	0.52	$	0.19		$	0.71
Net income per share-diluted	$	0.68	$	0.24		$	0.92	$	0.51	$	0.19		$	0.70
Average shares outstanding-basic		12,310		12,310			12,310		12,215		12,215			12,215
Average shares outstanding-diluted		12,481		12,481			12,481		12,403		12,403			12,403
(1) Calculated by dividing consolidated income tax expense (benefit) 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 income taxes calculated using the Consolidated Adjusted Effective Income Tax Rate as reflected above.