CULP - Earnings call transcript Q3 2019

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Operator

Good day, and welcome to the Culp's third quarter 2019 earnings conference call. Today's call is being recorded. And at this time, for opening remarks and introductions, I would 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 'XX. the results company's third to afternoon, call Culp review Good quarter of

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

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

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

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

Frank Saxon

call our call business. will mattress welcome we'll quarterly and to 'XX questions. comments, I then afternoon, that, everyone, results will I the of would review our and financial Culp brief our to be today. update conference Culp, President our the in outlook begin review for fabrics call with Iv investors. and today Officer Chumbley, quarter. for quarter I'll on Financial With the Operating and you, Boyd business; our us me happy fiscal upholstery analysts Ken like Officer; strategic you After the with Good your each Chief the Bowling, some thank of fourth our of Chief and President and fabrics businesses. Ken you Culp joining on take then Ken will actions then business to the is

from results for reflect industry, the bedding fabric of products The mattresses of our and our for volume to expected, in these As of demand related high China. third low-priced the significant our imported the supply market challenges major covers. to which continued current mattress disrupted has reduce has primarily most the quarter affected the ongoing industry, the for and customers

supported quarter had that fabrics the Read for at Products third Window contribution solid fiscal acquired our are of pleased business a by performance We the upholstery XXXX. meaningful another from end

believe relief the from from will address benefit low-priced We continue to imported bedding to the sought China. ultimately mattresses industry

the our monitor ruling these the And improvements the customers. U.S. have businesses, customers the pleased of recent confident against are Despite our ability business. bedding resulting changing tariff X, and sequential creative government facing in XXXX. with although continue are to the all especially industry, May and in and expected our might to we However, measures potential designs the and punitive of pleased with our importers, with affected additional showings for has headwinds with business. they meet Chinese innovation been delays now product from the we our delayed, XXXX, positive strategy impact, fabrics timing we ongoing March on discussions in deadline product-driven preliminary We have and if the expected on we'll mattress seeing in tariffs shutdown any, demands a are focused the very continued remain our

cash expected to free with and to with $XX last cash through both goods Ken, believe which We new for also opportunities long-term positioned pleased review expand for results million year. I'll and call Culp the our for finished in products, channels Accessories, expanded bedding year's who'll We with total. our our the turn comparable to financial new consumers the market cash quarter offering, accessories highly to fabrics of investments, businesses. global well flow also have debt strong the is year, sales additional our over segment, product a our Window of focuses upholstery no which on business, -- competitive and direct e-commerce and platform. now home reach to manufacturing Products, and and Read to part position and Home be the I'm financial our is offering and Culp

Ken Bowling

Frank. Thanks,

earlier have website performance key call, posted presentations measures. slide we cover to on mentioned to As the Relations our Investor

also allocation our capital posted strategy. have We

non-recurring year. with for Here a quarter the this and financial million mostly to were $X.X of company of and are of facility. pretax The included income the the compared the sales income closure quarter. and of sale other million $X.X financial with for $XX.X pretax results our and in million, highlights the X.X% charges Carolina for related quarter approximately $XXX,XXX prior reported items down South On last production compared year. due credits Net Anderson, restructuring basis, third

income for per was net share attributable with $X.X income $X.XX prior or diluted year for Inc. or $X.XX Adjusted Culp the million was the restructuring-related $X reform charge, to charges non-recurring $X.XX third and in net for income, adjustments $XXX,XXX with Excluding and exclude per with credits The $XXX,XXX associated current a to or I compared These a income benefit $X.X noted. non-GAAP a this year periods shareholders income period. totaling $X.XX just tax million share provisional net quarter quarter, third also and $X.X $XXX,XXX prior $X.X diluted million the GAAP share was loss compared exclude for tax results million. per of share charge, net respectively. measure, the year items pretax diluted tax the per a million and period. diluted or prior

income tax previous reform. effective was Our compared tax XXX.X% quarter XX.X% both quarter, of with last the year's the rate for third impact third for reflecting to

operations. we in was For domestic $XX.X our XX% million year, EBITDA to XX months adjusted on our of mix rate subject change the consolidated foreign X% XX% tax between sales. or LTM was in range, the the full material to to earnings any estimate of capital be return Trailing and XX.X%.

let's a at business segments. our Now look take

million, operating X% sales were third Operating XX.X% year income down last income XX% of compared segment, year quarter. a For ago, with $X.X margin million was with a year's million mattress fabrics compared $X.X an compared $XX ago. with with

the Our The in X% basis the for imported significant operations second XXX we in the mattress year's capital operating this XX%, Chinese mattresses. current fabrics and third investments operating from given the past decrease we LTM have improved are both caused quarter point improvement XX.X%, to still pressure, last efficiencies years controlled the by and business affected as growth significant we margin, were capital was down the results. Despite variable over costs. demand by but a return achieve have in quarter business over reflecting sequential for paying encouraging off condition. fixed able were made on still

year. $XX prior up For quarter third X.X% over the the were upholstery fabrics, million, sales for the

last compared income operating $X.X a We was XX.X% the able current the to the quarter for from Our was sales same year. with third same currency line in for last with were benefit quarter $X.X compared higher X.X% year. period income last with with compared expectations, million in for exchange with China Operating rate and favorable the million year. margin period

Anderson, With equipment incurred South the of our $X.X net restructuring-related proceeds was million. facility, total and we property received closure salability, the $XXX,XXX in and Carolina charges. additional from Notably, an sale

approximately annual return capital impressive, million, this million to margin operating for for Read expectations, with business and $XX Products, at continue upholstery whole. the current LTM $XX to as Window well continue coming For in in be the fabrics XX%. rate for margin with overall which sales a run perform the to on is segment line meet income

our presentation in includes for loss fiscal which we Certain Accessories, release, for quarter due in for the to product rollout XXXX website. Operating the primarily posted quarterly are operations last marketing expenses. for eLuxury. our Home including the the sampling no the the the results Culp period available segment, this segment slide noted and business information now $XXX,XXX cost, segment press same on was is selected year As new reported reporting with year. third This comparable for of for of sales a results quarter million $X.X new

balance have maintained sheet Despite highlights. of reported we as the end are of facing a third position in cash financial the we with so far and the in business, $XX strong in total are We fiscal mattress XXXX. million investments cash no headwinds debt fabrics Here our the quarter.

XXX,XXX approximately approximately during period and of months year. X regular million the for the of quarter, million to this is Notably, fiscal acquisition-related on capital shares call of dividends year, spent fiscal down total the year shareholders we thus this shares with the and The vendor spend million program. leaves returned $X.X repurchase share X I'll from repurchased months spent of million the company first during $XX.X under approximately $X.X XXX,XXX repurchases. expenditure from investments $X.X capital available including last back turn million this the During for Frank. payments the $XX.X in financed over million the that, have repurchased expenditures, With $X.X share to a far the first same significantly year. This

Frank Saxon

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

fabrics significant mattress affected sales the by for surrounding were the quarter industry. ongoing the third Our mattress disruption

our fabric mattresses, of has our imported a volume With the year. high excess which challenges we and and in into the third quarter, the QX low-priced of inventory, operating been the demand of affected trend significant mattress the continue expecting with to covers and from the sequential next dealing faced, spite In quarter. customers amount into showed improvement industry fiscal for performance the during sewn we are the

customer CLASS, platform. cover. With provide needs. in full adapt and covers pleased to and products complement favorable, a about continued optimistic mattress and we in that market we're we favorable also North the finished have to distribution remain mattress and segments, existing potential our future the flexibility to popular the in recent January, Demand production evolving and bedding boxed from had to our substantial the had reached Carolina, continue cover our late mattress Culp of a capabilities production energized at trends opportunities develop Culp which maximize sewn positive business, both Haiti with mattress We're and Las CLASS, We we with very covers capabilities platform, response especially full the design for the customers about investments Vegas new fabric growth efficient growing fabrics the progress as has with from especially market for and new been and production China our for showing customers. and excited space.

positioned reach we're market our We the products stabilize. are focused changing sales on expand new well and opportunities to to trends, especially mattress demand industry and the with as the begins complementary meet channels, ahead to

from ultimately Looking business. to ahead, are China. somewhat, alter slowing activity away we Import benefit antidumping will supply chains be importers measures Chinese customers our to and beginning our believe some customers and appears the against

inventory first sequential Although quarter coupled results. and there through strength, positive off. our steady that design large in XXXX from share and gains demand already we excess providing our Nevertheless, as likely with of are are are sell development improvement at late some remains efficient improved to the operating least platform, trends take manufacturing market a to noticing imports

Now upholstery fabrics segment. turn I'll the to

affecting in We for the quarter which of upholstery fabric with New with especially achieved We're expectations. in of a was was timing pleased our Year sales line a from solid Chinese last third our South these strong delivered quarter. sales performance year's sales which business Our another over the quarter. quarter, loss Carolina improvement very quarter Also Anderson, results facility, the was the closed of during spite holiday. our second the late contribution in third

the expand product as opportunities during contribution meaningful supported market. Window Read hospitality And we growth for were a we're excited the sales from by Products. about our there Our portfolio quarter

customer markets. sales with hospitality innovative products, the and of drive wide to base ability continue array designs residential expand We our creative our both a in to and

in also for with fabrics a We strong enjoyed the acceptance recent showings December. customers

both new Our customers. performance be durable, stain-resistant continues and line of fabrics to popular highly with existing

us more well markets reach have new to ability marketplace. today's and served in customers strategy end-user product-driven Our and

business. any Looking if to uncertain. the geopolitical and ahead, associated to accordingly tariffs the in implemented, on we Culp's additional related ability the potential in might solid these XXXX when monitor continue performance in be impact were we situation we there was for prices remains and be additional We'll fiscal tariffs Despite another did risk fall. tariff as would expect last to our raise XX% are implemented to uncertainties, extra confident XXXX. deliver And

Next as products Culp's of of finished sales includes a combined business establish in eLuxury, Culp segment that accessories June platform I known and Culp will and the to hard supports eLuxury and our have both business Accessories, operations worked Accessories finished in review new This offering BXB and home create goods. products. Home investing which e-commerce XXXX, BXC we bedding Home

division. and other with Culp items platform in home have and Culp's We manufacturing to continued coordination and innovative bedding other global accessory the through develop create

inventory, While pressured out, operating to results products take we look quarter for as typical quarter, which we'll excited new the then about questions. Ken and the we're the product through the your exciting issues, We're sales forward channel this now array Culp. review have our fourth for working to now of outlook pointed the Ken will rollout, marketplace. sampling new still for which and in an marketing we introducing

Ken Bowling

overall year. compared of quarter down be with fourth slightly We expect the last sale to

associated up with slightly be expect sales, year to we ago. a imported to the up expect Operating same quarter, sales improvement segment, expected year. compared fourth with mattress and our the segment third We but of over In Culp to the continuing expect income the period year margins same Chinese segment, with last to year's lower the this Accessories to compared period moderately are slightly a with with headwinds sales fabrics our our In margins slightly and quarter in due to be upholstery mattresses. fabrics also be sequential income compared up be quarter. ago we compared show Home operating third

to We for with issues expect of operating quarter million for and quarter income fiscal $X.X work the to in expenditures to year's year moved capital quarter rollout income continue fourth as million approximately sequential for more are be million. level expected $X.X fiscal compared results. through improvement factors, we to for now expected last this stock we Based these be year's compensation range expenditures. fiscal was million the approximately projection, of an $XXX,XXX to for is the be Considering million. range current to pretax product maintenance $X.X amortization a have the our on this year $X loss Pretax as to fourth And $X quarter in this expected new year. to with for with million $X.X third expense we capital fourth depreciation expect be the

mattress comparable headwinds in flow our segment. fabrics to Additionally, with given facing $XX.X be cash for expected last year current the significant outlook, year's even million is free we're fiscal to this

last As I before, the will million your With $XX.X free said we a and for reminder, $XX.X take year, was cash as that, year million. flow cash flow was questions. from now operations

Operator

Stifel. [Operator Watt will from And ahead. Instructions] go take question we Dillard Please first our with

Dillard Watt

Great. Good sort slowdown well of Frank, a out bit are market Customers the side, customers? the grow talk manufacturers. you just the seeing what that on all morning they obviously, is could imports a mattress seeing you're from traditional share? impacts But about the tough you Or industry e-commerce pretty generally e-commerce maybe gentlemen. of it your to as channel? little publicized on from

Iv Culp

about the Iv. more still for of is the the We're more bed-in-the-box -- this Thanks excited e-commerce space. a question. known Dillard, lot pretty

are excited important is space, the the that less a mattress as products also growing, just note of there's that's see forward new part quite ones out, where work I have on ones rolling is, that slowdown a more it them there a lot general maintained our to maybe. us covers pack, stable of e-commerce for the so to important difference mean, going important in traditional we're use go. doing a players That's kind actually I and going that footing pretty it's roll innovating and growing in big bedding the Although the don't boxed critically and for to really bit. The a future. about obviously, and we're guys. and but players are many really aren't is

Dillard Watt

Okay, great. we to should pressures? And Thanks or for materials seeing what other of the next sort that and expect from over unfold the Ken, color. And any inflationary are Frank XX you months? how X, raw

Iv Culp

what something there really feel never lot It's of operations, fine something in feel either. I Dillard, mean, And stable. we certainly that that better will increased I'm that This we're think, confident things lot in I see, on us process, some too. -- get to a is not banking not drop worried a of Iv. something take I'm lot. pretty the down business bedding we going the materials. I'll a for materials from side, but pressure from about, to we're that is We optimistic a be not

Boyd Chumbley

is to right the just also Dillard, that, from stability fabrics to side, now raw And this are add Boyd. seeing really materials. And in upholstery we

here like it we've a So stable. be where it time relatively should appears period entered

Dillard Watt

each more X applies All of to business, main and this right, then And each of great. sort X the businesses.

disruptions mattress in it's assume out, Is on low-teens hung had think, that the in work this than -- different got You've margin how done also had side upholstery businesses? line. issue was mid-teens, plants of in of the time one less it potential top But some on I'm side. and and those whatnot. to a we've couple wrong? Upholstery years each of now restructurings, I but -- the some me I the the and a before lot maybe there, has today I a probably know of capital past, of levels. quite putting work correct the kind higher so volume of Obviously, potential closing on should the mattress been it the space on kind if at you those

Frank Saxon

Okay.

range. always we've long-term to think margin that. has you target, the years, and what when said really for we've mattress been I are some area the run good, rate, XX.X% exceeded it, in XX% fabrics actually whatever call things may In

expect so back long when years would still bit the XX.X% it's same antidumping under those as target get But to of term, we ruling. not Some relief a below and get some sort I range, good, little XX% that.

that's On what quarter, to X% really there to the upholstery now, in annual would I say, we've of that's single-digit that fabrics same is side, X%. X% XX.X%, we're said with said an little quarter that X% good right a and year at higher best the also basis, of Read than And on always was seeing those really a we've range. is target, the third in but same window kind line high margins. What

would So that our margin long-term be part.

Dillard Watt

there the jump in. thank wrong let But I Boyd. Not the somebody credit appreciate don't okay, and I the I'll misspoke numbers guys. But else deserve that on upholstery. you you there.

Boyd Chumbley

Okay, Dillard, thanks. thank you.

Operator

And we will take our Please with James. go next question from Bobby Raymond Griffin ahead.

Robert Griffin

afternoon my Appreciate Good taking questions. everybody.

Frank Saxon

Bobby. afternoon Good

Robert Griffin

of segments? little How I other out the want does variable fixed So help us compare your home of to and nature standpoint. just get a some accessories first business, on color guess, I maybe modeling business kind of that a from the talk to to

Iv Culp

definitely while, it's accessories the it's business, today, eLuxury. our when that about Bobby, primarily only home Well, talk important business, note, eLuxury we

of we business have business. watching -- connecting It many understate all just this and really We plans it's as I'm our so for grow, businesses. is that shouldn't

across So, everywhere new in platform And place it even from products so selling in from to the we're everything. for home hospitality. it's that to to really many fabrics, that touches And I'm recently watch dots. fun It's business, really in into connecting fashions everything. upholstery me the operate it role

think more that So we BXB because the a that. that's some primarily a e-commerce potential we're home that we us e-commerce is I for is BXB whatever just higher side, side may be opportunity for many lot fees us which business for with of a launched, it why there gets and have do is little pure Amazon expenses the placed, pure pure breaking going side. is so something out blurred getting But even bit of marketing fees really accessories, when to are But exciting to there for market. e-commerce be is in or because cost the marketing

a So many a about so us somewhat is products That's it's right we're some to fees. that. at so launch lot return dragging little is because learning now is incurring taken bit -- once much new

excited it model cost So is a but that us, business profitable our we'll being about definitely get than stable. that Really traditional a businesses. for higher

Robert Griffin

Okay. guess I

Frank Saxon

Bobby, I'd add to that...

Robert Griffin

sorry. Frank. Go I'm Okay. ahead,

Frank Saxon

I'd add to Bobby, that.

a is I in think business. lot of leverage that operating there

on -- distribution a and overhead fixed they the got. overhead, the overhead we've same the general more drive With and fixed just generally can lot business

Robert Griffin

helpful. that's Yes, Okay.

So when come to I expect way or probably a I do do business that that out ask just guess, question SG&A the way maybe margin gross a you that? look you improve it you better in leverage? to business, the How been, -- about and might operating margin another in SG&A to from think have years mostly look couple of

Ken Bowling

Hey, is Ken. Bobby, this

a think, said, -- as I we've business. learning lot about the we're as Iv

the costs the as efficient continuing China you our things far there. work to raw as when Also, there with with from the platform standpoint for that think SG&A material on gross we a on to between platform can up -- is synergies and and ways do there. look with save Amazon at obviously side, point I coming looking some side, more the opportunities make connection

there's business. sides opportunities learn as we the continue on both to about So more think I

Robert Griffin

maintained. impressive pretty anything helpful. prevent of margin's return that the growing type type same I it the plus I when mean, That's the that. the from declines, the of does also structurally, very appreciate would profitability XX% segment, I on touch type margin. Frank, it's at volume high-XXs then to -- volume it's mean, And mattress double-digit contribution the I with big I Okay. guess, been wanted

Ken Bowling

a turns it And the last payoff pointing when more is business of improvement, going X We the lean Frank's things in to we've me we in good it's knew crazy and to work so real efficient, we've much behind was think XX% about get some turns, design is we're capital to decrease talk we're it much, years, it it's of is us because multi-location payoff. it done much really is really to that the just business. so in spent And we give that our Iv. invested me but that well releases one we're kind all to have money point. driving to process in these repetitive press And it this the whole it maintaining the the off comfort, because for thought that, as really more what's upside lot Bobby, manufacturing thrilled saying processes, are to about driving platform, the -- I or paid streamlined me it does It and more fantastic going we of put in too times. as these times, this certainly it's to the and decrease. facing. that Yes. macro talked through Bobby things

Robert Griffin

at from That's in understand on in effort help our you. a And kind maybe on site eLuxury? terms to going just my new of of How first now? type getting guess, And Culp we cross-selling but little cross-selling touched update the can -- question, many on on have Thank first me, us is anything share some helpful. of very there of some type branded SKUs I bit And lastly there on products you there? on some of that progress. the goals any you

Iv Culp

see to of they that solid don't We have like best mattress of has best or in just of then BXB. think want bedding items but and be Culp general, and profit pushing. lot We and with we're But to a they only the Culp China, see lot being products find. BXC lot upholstery, you'll Yes. eLuxury are I in the really we'll potential, We us obviously utilize a can with pad launch. with items, don't supply made, we a products. we with really, new accessories accessories there that both synergies. finished brand lot are branded a any that a primary LiveSmart and helping lot Fabrics products will the that eLuxury product use brand, of think can home LiveSmart we'll brand through see for items, push, rules them importance some it the certainly market. that is we And lot Culp and we'll a have

and So aren't if some items be of products will that so in there generally my things Culp hard will products, some have in that Culp kind a we wish, you at we fabrics But once, have be good or make to are and lot new the launch them. somewhat some majority of sequence, it lot of developed coming Culp be to now. speaking, synergies the but It's be find a launch we're doing of things just ideas a sense. would but see of most

Robert Griffin

we tax down come X fiscal XX%, Will I rate? year, to we a for question to more from out should of you.And modeling expect as XX% guess, up our next we just rate? start the tax of of get kind get Thank use tuned to little? Ken, this look models what Or should it still me. kind

Ken Bowling

be rate best U.S. can earnings that's in by Bobby, we mix probably our the and that foreign the mind Again, between operations that got. impacted keep of the

that's what's the XX% the from rate up driving rate. federal So

XX% of are XX% and now, things, but the look we range the at right way right kind is So where today. we -- to

I'll update course, that range. Of each quarter, good but that's now a right

Robert Griffin

all Best you questions. my appreciate luck Thank answered going you of guys Ken. I forward.

Ken Bowling

Bob. you Thank

Operator

go with Rodriguez our from Marco question ahead. Markets. And we next will take Stonegate Capital Please

Marco Rodriguez

my you fabrics. thank wanted I back kind around of questions. Thank and on for taking circle you mattress to

be some because to might Just mentioned volume shortages I in you've able kind got the impacts. you you quantify weather? wondering saw QX maybe you if of -- the weather was of

Iv Culp

Marco, thanks. This is Iv, again.

that trends. We disruptions are there But when is retail reflected on almost of don't were I QX, Friday X.X certainly, so in we ice where third closed which for our well. days, about really as we of mean handle performance the because full on late, or which really, much weather a that we have just snow -- that days, talking X quarter had not we're area, in impact

that to really for X.X us of shipping, just Fridays never So lose up. make you

that, can Ken, significant next end problem. week, Fridays, a of that at much the quantify if the that if so few shipping so don't would on And a a days but know where bit us prepping miss I we be I of for to impacts was the do Monday. what That

Marco Rodriguez

Then volume understand. in the Chinese with issues the industry of that terms has imports. I obviously you. impacted Got the been entire

of through of inventory little kind of kind more that additional higher. there? perhaps I forward want remarks the lot bit got through provide sounds have it in go like, of the kind color some just complaint. of get implied at prepared sort has a even talked comments. that last of of a Can But press lodging we least you anticipation orders some know your quarter the of your been and from of release, pulled about Just clarification to any

Iv Culp

way starting point fashions, we're been that this even the about it's important really a performing QX year. of what the down to that there at important still over to we're is trying emphasize, we guess, get really want home the decrease forecasting to us than half -- is I for we're Yes. though we've it's Marco, it's talk for and

us, placements are that we strategic even So in seeing happens. sound, of impact our any has before gaining really we're any that and improvement business before on antidumping

antidumping be get comes antidumping will business We're better So that. gravy even people it impact, through we're we because happen the ruling drive the delaying if while every unfortunately much for chain will, will that more the in is a we're It and about start we supply longer ruling. the are gambling do the that's even don't -- bringing inventory going seeing it's have us, take to meaningful chipping in And at changes. QX really little we think but delayed the back delayed, business like do and to around. not a of which turn the and sense that coming, expectation has legislation excited will just away this and that

customers and are hasn't it with it new in trigger all lot it cases a pulled customers supply alter talking to people -- the working current the but So we're chains, hasn't and really yet. of about

think of QX. change showing built why We back up the are that's we're not just a little inventories bit. the really getting So for much

Marco Rodriguez

gears shifting of that home with accessories noticing? Then you. with companies of Got your there side, here from seasonality thus kind to far is you're what that any sort you're the learning there part typical business, of just differences e-commerce wondering

Iv Culp

than businesses sales because driven our -- For business. gift-giving sure little more are a some it's to heavily also have have of because products we holiday apt we a core different things. or that promotion bit some kind It's

discounts with it lots we're times. of certain around driving So

levers you it propensity as find don't have I day, than deal we nature to can And can a push business we get on will thing. the that -- more of a pull lot higher, do this push be So much of almost that almost of, driven. seasonal seasonal, more Amazon promotional it is adjustment or an the things to

Marco Rodriguez

Got you.

some As any far to what of 'XX? the better I give 'XX new then in particular year in kind give color kind look far guys promotional large into here, as timing next how be kind or of we a of was as as bit a fiscal as -- activity the that through or launches as revenue rolling segment. as about kind us products could a little you fiscal or cadence you move far calendar for store us of of sense might have as will out wise wondering you if talked bunch

Iv Culp

Yes.

what be better in that utilize and I with do doing, Culp manufacture items anything that from materials By Yard, own our produce on all products lot The products thing mattress the of we're a think would one which can eLuxury, current full-finished fabrics of the replacing to we or is and way case first working pads. we're

something of for up. So something and putting phases where kind the we're a lot the beginning of down one taking

things talk then some Ken but minute, stable behind at that a want kind of to steady, that keep we'll like So for some the business to mix. to down adding driving profitability. we'll products optimism just to be keeping and sales while can come continue I that things the where focused will have just little add in sales. we're then about for get me start level, focusing on growing and time the a need on to and and more sales And a up

next takes a should year. So but it in year some necessarily something fiscal little while. that we have to growth next It's not has rocket that growth, a start business leap

Operator

at there it no [Operator this time. Instructions] questions are further And appears

Frank Saxon

us, everyone, day. to you, Thank look for we'll a next Have updating quarter. great and forward you Okay. joining

Operator

may And disconnect. participation.And for this Thank now you you conference. concludes today's your

Culp (CULP) 4 Mar 192019 Q3 Earnings call transcript