CULP - Earnings call transcript Q2 2019

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Operator

Good day, and welcome to the Culp’s Second Quarter 2019 Earnings Conference Call. Today's call is being recorded. At this time, for opening remarks and introductions, I'd like to turn the call over to Ms. Dru Anderson. Please go ahead.

Dru Anderson

you. Thank welcome for conference fiscal the and the to XXXX. the results Company's second to morning, call Culp review Good quarter of

will of the As this the me let Company. financial contain call business, prospects we about forward-looking and state condition statements start, morning's that

or risks historical the and regular could XX-K These are events fact. filings, performance the recent that Company The forward-looking materially about uncertainties statements statements, described by are from including XX-Q. most otherwise various statements are of indicated projections, expectations and uncertainties. actual or Forward-looking beliefs because not Company's differ that or and Form include future results, statements of Form risks in SEC filings our on of the

reliance and today. this statements undue You to on no forward-looking each statements. statement of as are or morning, cautioned We only undertake update speaks obligation made to forward-looking such not revise place

Company Vice with sir. A on and the call. ahead, most non-GAAP discussing this performance schedule and during be on non-GAAP financial summary X-K will to addition are GAAP also the comparable at directly measurements Chairman Chief now turn measurements. part financial go charts will included I financial and Executive website measurements Company's Please culp.com. to financial available call, A information Saxon, webcast over as presentation the In slide Frank as the supporting posted website today's Officer. yesterday is a these Company's additional of of to call the to the filed reconciliation Company's the

Frank Saxon

our then call update our analysts will with our is each Operating Mattress call to then would segments. Officer financial begin President on actions me our strategic Culp for joining you I'll morning, business and I'll in the call us that, Culp, you, to quarter the review investors. outlook, the on and and Chief of Chief and glad some you today review your I results Ken will with the thank With conference third Ken to comments answer you and Good then for Iv Officer Bowling, Dru. the questions. quarter. Thank quarterly welcome Business. of be brief Financial Ken our like Fabrics then everyone, and the we'll After today.

As mattress approved results significant address expected, the increase the reflect for facing this bedding industry. believe quarter mattresses We for under ongoing ultimately industry imported favorable laws trade from our low-priced challenges U.S. domestic to be to recent situation second the petition China. of the the related the will

our mattress However, imports volume the to the quarter, mattress of continued reduced affect covers. high fabrics our for and second major which customers demand during

XXXX. a fabrics upholstery Products, performance Our of contribution had from quarter acquired Window second in meaningful was April solid for the business a with which Read

are considerable to duties our experiencing during headwinds in While put and quarter we we're place. preliminary industry, expected announced the as the that with quarterly results we mattress in to optimistic of will begin fiscal respect be year, improvement this to are fourth see

new into our continue as we execute product-driven will reach our markets. We strategy on to expand

diverse the offering space We consumers. to growth goods eLuxury, all, excited of the in potential meet e-commerce base. remain are Above Culp's that for demands the we offering changing home direct accessories customer hospitality innovative and about focused Window and Read designs bedding opportunities business on and products our for creative

our decisions second free future. funds during share dividend continued quarterly flow, and cash Importantly, confidence another the shareholders These quarter to reflect especially increase repurchases. strong Culp's in generate we to have and returned through

the for I'll the the quarter. will have we Ken, results the current the market financial who continued as to review financial And We evolve. this conditions to call well-positioned support our environment. turn for strength business now in over are growth

Ken Bowling

Thank you, Frank.

slide presentations posted As cover we mentioned our call, allocation performance Investor posted we to earlier Relations also capital website key strategy. have that our have measures; on the

X.X% were quarter X.X% ago. closure quarter to margin due of million in Net year. the highlights other compared our quarter. the The $X.X $XX production million, benefit was second with in facility. with down South and included of and the approximately a second was for income compared last the year. a net year for non-recurring million, $XXX,XXX X.X%, financial Pretax items with results restructuring and are $X.X charges Here related Carolina Anderson, mostly sales second compared Pretax credits the the income prior

net the down was Culp, for for per expenses, XX were share, XX.X%. $X unallocated second the diluted million or year was on quarter $X.XX was share million compared Trailing return SG&A compensation capital fees. diluted $XX.X income compared Net With or to $X with due credit, to Inc. attributable shareholders sales. LTM income year. lower to this was pretax months professional period, of expenses Excluding incentive Consolidated EBITDA to million prior XX% respect the expenses or and per $X.XX adjusted corporate quarter $X.X mostly million. X.X% last lower

let’s a Now, look two our at take businesses.

million, with a ago. sales operating X% margin segment, last was income margin compared million, $X.X million income were second a year quarter. compared -- Fabrics $XX down with was with compared year Mattress operating of XX% with income year’s ago XX.X% For $X.X Operating

pressure, minimal $XX past have contribution. reflects fabrics improvements eLuxury, business achieve million the the for for the in significant made current which imported caused rate capital by the investment operating Return years. the With decrease this we XX.X%. for operational Chinese income was margin, is still mattress annual were run X% were to over growth regard the a on with in several sales quarter this Despite significant mattresses. by able in operating operations in we second Our affected demand to approximately

year. primary fabrics the segment, $X.X year. Read last period over Window for with the million, million million income Operating for compared the $XX upholstery contribution compared quarter margin X.X% were Operating income the For the to was for Products. sales X.X%, last due X% with second prior year, $X.X same quarter, up from was

second we in expectations currency and was in for favorable with line operating benefit the quarter Our a from did China. more exchange rate performance

tariffs impact during offset of However, the this quarter. gain implemented was partially unfavorable the by

closure of the expenses. incurred approximately we related early in quarter, approximately and actively we Carolina, the and equipment sale South operation $X.X $XXX,XXX the million, we pursuing sold With the for plant. are Anderson, Notably, in related second restructuring physical of our

margin Products, be than Window impressive at rate Read for for higher margin on the annual overall to is segment coming for Return fabrics income the million continued run in operating $XX capital this For current $XX business with upholstery as slightly approximately a to operating million whole. the income XX%. sales

sheet are fabrics mattress cash we have business, We total position half facing in $XX.X strong highlights. through million generating financial year Here free flow. first maintained are this the and headwinds the strong the investments are debt. in of cash we and and balance a reported Despite no the

this spent returned expenditures, first $X.X capital share million fiscal payments, six vendor of dividends regular $X.X repurchases. acquisitions shareholders year on the in million for months we funded financed expenses including million related to and and $XX.X have During and

our repurchase this year. continued expect XX,XXX half program the cash we repurchased of by during second call this million turn available the the We share repurchase additional approximately With Company months back of the fiscal free quarter, under over six XX,XXX June $X.X the strong first shares an I’ll Since end Board program. flow year, have in approved The available leaving Frank. to leaving $X.X fiscal of the of shares, XXXX. that, approximately repurchased in this under million

Frank Saxon

I will you, fabrics Ken. mattress Thank our start with segment.

first the reflect surrounding ongoing mattress industry. fabrics fiscal pleased of disruptions and quarter. were sales for uncertainty over sequential XXXX mattress the Our the the to see second growth quarter We sales

imported promotions retailers that number mattresses United was of anti-dumping Trade However, tariffs International from approved on States States low-cost the mattress significantly China accelerated orders mattresses increased and on Xst, domestic companies In by anticipation the petition of and Commission believe imported November disrupt have continued mattresses. we of entering to a the the business. and United both

As a continued our during quarter. result, fabric sewn lower we from the demand customers covers and for experienced

second eLuxury. to first quarter the operations include full quarter of the marked The

e-commerce for in about space. the growing new to We are channel very the participate excited sales and this Culp important direct-to-consumer opportunity

platform. hard are accessory We to to through create marketed working innovative this bedding develop items exciting and be

platform, for near We as we our expect prepared this new term. been business New to global and into products proposition, manufacturing trends see favorable is category value have we inventory already enhances strong developed the launches the being in and eLuxury from believe product Culp’s move year. within growth calendar

in short-term operating Looking to ahead, challenges do and performance. ongoing continue our will the we mattress see demand industry that trends affect

in covers. November we mattress performance the channels, challenges and is fourth our from fabrics to normal quarter. to it developments, will with industry forward trends core believe expand Chinese ahead look year. the we to and to us, to see levels. our importers is approved the are pleased when some see and While anti-dumping petition Xst, customers more and will expected our sometime against return will measures our this benefit beginning behind Once business, demand ultimately on we we uncertain be We beginning new all strong business sales significant punitive of positive of especially will and complementary are begins fourth product mattress expect uncertainty categories and improve during position sewn as a fabric the competitive We to opportunities operating this our we have sales quarter to solid reach the products market spite stabilize. In fiscal facing, across the were

turn Now, the segment. fabrics to I'll upholstery

wide upholstery our for fabrics markets. in results and higher customer met the creative as last to expectations residential second X% These ability a to second both year. with sales we and offer diverse a quarter growth are performance innovative hospitality We to with our the over pleased products base, quarter, a sales with designs customers of array reflect

Importantly, hospitality meaningful Read reflect from market. Window these in a the contribution trends

the additional in the market another treatments for of hospitality had featured the section we successful expanded space. excited which, growth additional potential where the High are treatments. this first of for window furniture and showing for a products, October including acquisitions line window complete We opportunities at Point, time, this We in our about offering had

and again we at customers. demand this of market, line Our to was placements upholstery well with performance continue received favorable see and fabrics trends strong

LiveSmart recently our The performance brands television Home. on Additionally, program, featured Learning Place were This Your Channel, Make fabrics

and and today’s global advantage product-driven marketplace. markets in a competitive for to ability customers strategy Our Culp reach distinct new is more end-user

remains point. Looking ahead, XXXX the and at the uncertain risks additional this for associated potential in geopolitical tariffs

the quarter furnishings believe benefit and business, situation monitor Ken then uptick We any home third questions. for more additional Culp to in impact response. Despite conditions. the implemented, if these uncertainties, market from review related the the is determine will an continue stable we’ll we appropriate and well-positioned now on are demand for and tariffs to outlook and very our we your take will

Ken Bowling

third approximately be sales with down year. last compared We X% to expect overall the quarter of

improvement sequential show to growth operating and to in lower We income fiscal quarter but significant last continued mattresses. mattress our primarily sales, fabrics to of in third due Chinese year, expect the be imported margins significantly segment than the

mattress to trade upholstery margins fabrics we that industry be trends are also fourth of compared this normalized line U.S. the year be relief prior to sales ago. to up with a period of fiscal strong with In compared expect more in Assuming Operating Chinese more third our New laws, expected timing we to last up see quarter quarter and a the slightly Year. the under year. the the year during slightly of same year due with materializes income the segment, expect are

quarter quarter range therefore Considering Pre-tax charges. imposed However, that pre-tax third non-recurring for costs. affect any could the could upon was million factors, restructuring tariffs of additional be XXXX, and related million, $X.X contingent are to projections any and last to operating and our million. effective we excluding potential expect credits in $X.X third report year’s income these January X, income charges the for $X.X other fiscal and our

now to as expenditures capital line moved a the achieved of budget, year quarter results for maintenance million to currently we range, for expected fiscal the of last quarter during this capital more fiscal million in expenditures. be to with be more fiscal year. fourth Based year this performance of Our is our $X to are expected current level on have the fourth $X.X in the

improved flow facing strong take our your the year’s and be free the headwinds fiscal cash in now cash last we’ll we outlook, current fabrics With with year mattress over segment. this achieved quarter significant given to are questions. even that, the is free flow in results, the for Additionally, second expected

Operator

ahead. [Operator with first John you. our And question comes from Please Instructions] go Baugh Thank Stifel.

John Baugh

guess how of Good business on if we the walk you. that Thank XX% could path plus, us morning. wondered you. your I if impacts the for next Thank some the tariff. that’s the we’re I And months looking give furniture what at XX sense down side?

Frank Saxon

do is And The position was January implemented XX% tariff put September. from we’ve XX% on the be I Good Xst. morning, is we we which place benefiting are additional currency. the side, XX% already the the in we furniture were And weaker John. to administration exactly that XX%, If with in and referring to, from will current, increase you’re of first we what did guess that will prices. got a as an

price the we didn’t do we the XX%, be raise have would XX%, give will did price So with benefit for plan we But a increase to from some did currency. to full equal, the thing to we because increase the same we prices.

John Baugh

same in other same the the an or one competitors XX%, some position you issue? are sourcing competitively And of you've thing fabric far Are the with their they -- where where where are countries sourcing and there -- boat so what Frank, doing they your is done from? got

Frank Saxon

let -- really of That's there, that’s a couple John. me -- really questions

one The come from. sourcing is really there upholstery country from of upholstery fabrics are is other from fabrics which meaningful first that in our the fabrics competitors where China, world is XX% no the China, comes

due increased few, also all is increases or which, and producers, raised have prices domestic to material prices as reasons. other have we they The of well. recently raw a some So, there hear

I continue not folks are to ourselves. China would to. they'd raising by And prices, have to would out increase that other we the So, have importing prices there expect from

long looked place six and looked we’ve of part other we India, XX% China source it there the which world. with -- might a competitive to it's or question look we've we've in fabrics duty. go second -- is is, with detailed upholstery any really of this last And The time months, especially the at there it's continued more the the Indonesia, Taiwan, upholstery none is whether Korea, could and customers our over to whether at source it's whether Turkey, fabrics even are South where

and we're with a that of lot us So, players areas. -- gives those in in touch

And so, the XX%. business that China the I risk on don't think a it's from moves

John Baugh

What we're And me said from a fabric? touch amount country, of then, sense imports in fabric XX% on coming I coming is think producers this China. Frank, percentage before are from can I give upholstery You of percentage? of the upholstery you consuming the a domestic bedding, as all

Frank Saxon

coming XX-XX. data of the think is envelope, XX. no a mean, our And amount say I is from back there would I of We there other public available. it countries. as minuscule

Some significant. from really from Indonesia, Turkey, come some they're but not

John Baugh

Okay.

Frank Saxon

Unfortunately, China wiped out the domestic industry last decade.

John Baugh

price in will on rest of what and the How of of picture mix the your there we we Whatever it Yes. so volumes And per look is yard? there. volume, does business because great. low-end fairly you're your much could then, business well impact high-end impacting Culp noise somehow bedding like? on positioned know is get But, bedding, I doing a give exclusive be you of were this as and the color not curious, the strong, there. if is hear I'm product with bedding to terms

Iv Culp

to covers the is renegotiating aren’t I'll are And well cover thing question want a take mattress some mattress prices to XXX just one. really side, because us have of you. the China we I plays our while tariffs that that able into Iv. cost, upholstery standpoint and a side to of tough of business some bedding today challenges should Section somewhat one fabrics your our back some those side location, tariffs. in expand and Thank mattress we bit covers the on mattress because recircle and and on from to a Yes. add John, that little is, tariffs. on that the this are are damaging And

might Now, pretty that, misconception, to business to of it question the business. that who any future high. low be leg us but enabling is in and knows today directly, from a China of really we expand it’s answer are our your -- to holds do, a really But into cut-and-sew our more we what quite third cut-and-sew well-positioned bit a

but this at been of up, what’s Our our just been targeted that’s be don’t of of will just lot disruption of that’s towards disruptive our innovation in the retail as well. and so built lower all some target bedding. end design, inventory really business because year, We levels a

both. So, for well-positioned I we’ll think be

going when selling high helps sell mattresses it’s For price make dollars. in make as multi-thousand a bedding the same us, company end high-end fabrics, companies bed very mattresses to by better because but we for mattress us, high. wise, And it’s the is not a point get lift

not able it’s us to we be and Our strong, dramatic generate still for both such medium to a But, in to be $XX high. fabrics both to low, we’re are -- need in $X, $X, going it. shift medium to be $X, to not going fabric range; to

John Baugh

extremely would I That’s that is retroactive until from announcement? before bedding see dumping maybe trying start wouldn’t and is Okay. and/or you the I’m a for number think be could your expectation, announced mid, quarter of a will see forward, or be a number orders moving that about Iv, expectation much even because what, get and sense how we’ll benefit to fear be as guess, flowing after rate And that? the through helpful. might that fourth shipments late-February, really that I announced, behavior to, different

Iv Culp

certain is with this that that but consult know we be we to year. it you, that’s everyone it Iv. not Yes. up it the The that going to feel The to like, can’t significant. we John. does -- lining feels -- again, and fairly expectation talk calendar of and certain. the seems it’s fairly guarantee I most is percentage Thank expectation with have we And be is

for chains production. of production working platform strong strong. inordinate cut-and-sew with U.S., for have and on an amount projects And really up very now sure reestablishing fabric all seen really we domestic have combined with our to And supply we’re three that in for a end. really China, Haiti in us, we So, gearing companies many

guarantee of win So, our places fiscal but to. we going them. used feels sure working end are of year to of that pretty And the it we’ve back lot we’re we these been of on should some business can’t a in all be to certain

John Baugh

deep know know, company they we an on doing funds, not finally terribly although well, they’re I pocketed did make got then, they’ve also but acquisition. SSB, And parent

that particular worry to we So, have question seeing Simple is, out customer? important access presumably, that you about they of capital. to what need all at are do receivable,

Iv Culp

worried critical have that mean, us that been do for -- we about that. not I business we We and with. to is one a really customer like

We business haven't way the BXC things worried too. smart. here best John. about We acquisition combination how the like of it, fully -- forward Culp of and a their BXB with are we which about believe been We I that think I of approach the they lot at looks really embracing

be So, something going target we both strategic of truthfully That's we customer us. for would that to a channels expect heavy those forward.

Ken Bowling

John, mean, account this Ken. closely news watched the we share is and that with -- and in I we them. very we contact certainly monitor

So, with touch in and on very of. top it's we an are account

John Baugh

Ken, has no been behavior, there assume. And, payment change I in their pattern

Ken Bowling

no. No,

John Baugh

luck, you. thank Great, Good appreciate I guys. it.

Frank Saxon

Thank John. you,

Operator

next Raymond to We'll James. go with you. Thank Griffin Bobby

Bobby Griffin

on heard what color can or your demand? impact yardage? unit your Help -- us tariffs. of price Is my how increases And of the XX% increases What have price back you maybe want to any have you appreciate I those morning, on there through think having some price Good having give things. you to you Frank, side I for an you or are of have the guys are heard up increases type started from customers, everybody. us volume first mentioned those about… questions. taking you the pass on to upholstery follow --

Frank Saxon

we're have but Yes. we're are Business exactly it yet. and people we're orders, That's all they been, still what it are -- not We're Bobby, worried is -- concerned what not not seeing I seeing see about mean, good. -- yet. pretty decent. that, Backlogs, we but about you

Bobby Griffin

that your from So, benefiting the seeing, you pure when correct? showing acquisitions, of still yardages are Is growth. numbers, just we're it’s some upholstery at yardage growth kind look obviously the of but

Frank Saxon

we Yes. it's down are related our and exclude then if that got But, with China And our you we've Anderson, even pretty feel cloudy tariffs. performance would with now. because good us sales creativity, a pretty those, I mean, the feels fabrics. remember, the in innovation, out. Carolina produced the little to plant we that are now, to I are good mean right And South line; phasing the all growing

Bobby Griffin

some then Okay. you to Have maybe made little how That's helpful. more Window -- hoping on with the maybe have is we've what's get I I really push as through you been integration in not, the Read If appreciate bit talked platform kind a going Products. color to And maybe was that. on before of the in past? able the China Culp fabrics timing about that that? of

Frank Saxon

there. sales The from very Yes. much has as than major been excited Window calling little fabulous we've customers beginning gone team a the very well. performing and well; we've really gone Customers we're acquisition pretty have offerings. And better all got it's the They’re key other pleased. about expected are expanded and integration a margins; on Culp flags Read on been They expected. product

suppliers. buying Read second use the get great products Window, it your other -- treatments. years part in with of fabrics; our which getting also when long-term, window one reception. a was which is place, is over bought, first in started Culp from Culp -- going some using to we the key synergies are few fabric take introductions That's are question it the to You of but we already was to great getting no

acquisition. another will already the quarter-by-quarter for on pipeline achieving And in bode market. hospitality feel evolve the if those of about We'll when very will and Bobby, results products synergy. particular we that that and well, So, course, that have good I get

Iv Culp

cases China can from we our Frank thing maybe well. also do was but those locations said Iv. as didn't products and him, North And, hear American one is this saying He to but what Bobby, specifically too. may those there fabrics about some had I add I in you yes, have would and what asked

both our from across just of So, Lot way trend the in the of dots manufacturers ways that products with ways, new to the lots Company Read to in good selling are a things and our fabrics throughout a connected further get downstream. and being traditional of it's find sort all are Company several taking good regard. really just -- the where eLuxury of happening

Frank Saxon

I so to look. role and seems more strengths that. mean, businesses. we that are of to like going various many see our got seeing everywhere Iv's And platforms. initiative clearly his now we We're capabilities synergy. our it synergy really in lots We've is opportunities among maximize among our -- And

going Read exactly sell I is and in which of more Canadian opportunity them CHF. do synergies but are the at seeing that little think, produced take we're doing - to see through goods this All time, the -we're a our this our we're to products channel. going the example, printing And facility, several part case Product is we're made digital them great key Window developing We like on this of where increasing for second among a the for Culp businesses. eLuxury.

Bobby Griffin

mattresses. Okay. think players, or to breakout that among I maybe for big how sales you volume do kind on of some and And capture get One, on something a the about percentage look return, do that capabilities to refresh we guys can of assuming coverings a also, then business, us on maybe here the guess, how that return under business little And the the us as U.S.? help does production is then, here from volume bit some you concentration to four me of anti-dumping, kind the lastly business? help of of of

Iv Culp

back yes, think look to question. little forward Bobby, of I your a to bit you little bit have kind and

been are rapidly for those and four big been four, numbers a XX% have that the have well time XX, know I I were maybe see entrants. even in we market but new sure, in the And time, the we the For industry. and so are think was past, has even that against many The us big business, long so targeting. the of being we beds just been are many for some long of much with sort a changing were customers in. the were we where because of grasped coming big and so of that's industry a sell, entrenched there we part that mattress but we close are market sold how to in that as that the haven’t as restricted not really

-- kind our are think, we're have, so customers. how of have the I of cut-and-sew are much can many being opened ahead how product us, new seeing platform opportunities to many we how eyes target and we of we diversification of

previously. much So, exciting list us than longer, And products much going think can bigger our is forward. where customer we that's it was take for we as about

Bobby Griffin

same plus Are the those plus big looked four there, filings at XX%, today time of is still today? around -- I the mean, I level last into XX% bedding sales, that still exposure

Iv Culp

Yes.

new and they in they with get that getting their products smart how strategies. they’ll they’re sales still protective environment should are get on looking placed at a assume, the lift of companies in -- obviously too and very also, developing also today’s I’d those some -- they’re think And measures designing, kind they��re I import.

I strong important fair, they’re no four; still I mean, that’s us, we doubt, Bobby. have to probably focus keep to certainly critically think big So, on. a those very

Bobby Griffin

Okay. I the businesses of moving appreciate of all forward, detail. continued strength the Best the and together. luck integrating

Operator

Capital with to Stonegate next Markets. [Operator Rodriguez Instructions] We’ll Marco go

Marco Rodriguez

and a follow-ups. of contribution Read? eLuxury for the for if also or revenue I’m not. couple in provide sure, this quick caught Just quarter a But, you did then I not

Frank Saxon

on just annual the operating we Marco, income contribution. rate and -- just run we gave No, sales

Marco Rodriguez

I I guess apologize. those I Okay. missed that. What numbers? were

Frank Saxon

for run Read the be -- million said was Windows sales down; to the to overall was income $XX upholstery million this million and contribution minimal higher for than XX eLuxury on approximately $XX Windows. -- the for for for rate. income, It That was $XX we Read operating was operating eLuxury annual going and then slightly to the going margin, the fabrics be margins

Marco Rodriguez

Was you. on over Got it kind or kind that? Cyber performance you saw could little what of kind of expectations bit about talk Monday? kind eLuxury, just you the here Black if a how maybe in just saw of of you And Friday,

Iv Culp

Yes.

for for was I around Monday, Cyber been sales think to fun experience and new us Friday, busy. it’s very consumer us, Black

hopefully lot We about products. with excitement and building a because of the lot of these a is have the we’re products that -- our out, new lot of and now, pipeline through it’ll in other finished and the we’re season. right products carry More underway designing, today process both holidays with a and fabrics things excited holiday looking

next our would year feel about at time all and the seasons site I items when of excited even are up for So, more holiday this sale. on these in

would it’s peak and think, see next those sale I was I periods even better. ones to be expect good, this fun to

Frank Saxon

works initiative a got of -- we’ve them synergy market, And that that I BXB we’re basis. And which the another is into didn’t line taking the is big on eLuxury to that’s as that to that pads another businesses. is the eLuxury sales. it about our as -- earlier a now sell hospitality those Marco, of half in our relates synergy into makes, in mattress mention between type cross

Iv Culp

figuring a us We Company. connect to throughout I it’s is put we really those together. lot that a a -- out And right. of Yes, that’s think just of the taken one. pieces have Frank time little in -- bit is But to where great dots

Marco Rodriguez

for no up little issue on in new looking that you products what far about as regard a assuming eLuxury. these and developing you on talk comments might also, at? these be when And the and there's standpoint. as to inventory that a you from maybe here launches launched, kind timing of been I’m that you’re might be bit these capacity then the And building products can

Iv Culp

few on the a Yes. put site. have items we already select Well,

We that airs. concert the we’re making to upholstery some Section show in platform, any impacted some products yard lot China we developed; products and these not today with fabrics selling have finished by XXX items TLC by we A are duty. of our these are

of timeline China development, dealing So the it's lead time and then, with a a you're of shipping. bit production of little

year. fourth profits gear starts to hitting more next to the somewhat it's again, be real So selling and really substantial our websites for fiscal the towards in us to and quarter up probably

Marco Rodriguez

is question housekeeping a quick last of And kind item. you. Got

with a running onetime take you now, a rate additional at full guys add looking excluding or to Is around things out? $XX in, you Now, are couple quarter look quarters going might SG&A be items. Read to forward run eLuxury for million good obviously there or that for

Ken Bowling

it's Marco, -- Ken. think I Well,

you say second I businesses at the we're is I forward, think representative going forward. look pretty little and bit to a addition going safe you that of new projecting SG&A. good quarter and -- But, to on think all future, be, the look think the with mean, the it's a just I mix when of I to of quarter to both that of impact where in look maybe where is parameter higher that probably at the I guess. second

Marco Rodriguez

Got it. lot time. your appreciate Thanks a guys. I

Operator

have no And does Thank speakers time. queue to any we further the turn appear additional our it questions to back or you. remarks. for over in I'd like the at this closing conference

Frank Saxon

at strong shares, I have and that year, is as ahead everybody are confident raised to want confident consecutive optimistic look future. One that Okay. but short-term we repurchasing for comment we we're everybody, seventh we last sheet make, for dividend Thank one the to weather very current about ahead of be opportunities We balance us. and are and want the our all sure to situation, the the optimistic how we hears you. I

just for say you you that, we’ll to call. participating forward to quarter. look Culp I want with the updating next thank again And So,

Operator

everyone We their thank that call. again, And you. gentlemen, and participation. ladies Thank conclude today's for does

disconnect. now may You

Culp (CULP) 30 Nov 182019 Q2 Earnings call transcript