Culp reported fiscal first-quarter 2027 net sales of $54 million, up 6.5% year over year, despite having one fewer selling week than in the prior-year period, while profitability and cash generation improved substantially.
Bedding segment revenue increased 13.2% to $31.8 million, while upholstery revenue of $22.2 million was approximately flat despite the shorter selling period.
Consolidated gross profit more than doubled to $15.4 million, representing 28.5% of sales, compared with $7.2 million and 14.3% a year earlier. The quarter benefited from one-time tariff recoveries. Excluding those recoveries, adjusted gross profit increased approximately 17% to $8.4 million, or 15.6% of sales.
Operating income increased to $6.7 million from $1.6 million, while net income reached $6 million, or $0.47 per diluted share, compared with a $231,000 net loss a year earlier. Adjusted EBITDA improved to $566,000 from negative $938,000.
Culp also significantly strengthened its balance sheet. Net debt declined more than 70% to $3.1 million from $10.9 million at fiscal year-end. Operating cash flow increased to $8.1 million from negative $695,000, while free cash flow improved to $7.8 million from negative $874,000.
For the second quarter, Culp expects sequential sales volumes to remain consistent while increasing from the prior-year period. The company is targeting approximately break-even operating income and further improvement in adjusted EBITDA while continuing to prioritize debt reduction and free cash flow generation.
KEY QUOTE:
“We are pleased with our first quarter results, namely our ability to increase sales and margins and to exceed our profitability expectations irrespective of the one-time tariff recoveries. We look at our first quarter results as more proof-of-concept that all of our work to integrate, restructure and optimize our platform is generating growth and profitability even in challenging conditions like those we continue to see across home furnishings. This is a clear testament to the CULP team’s successful execution of our strategic plans over the last two years.”
Iv Culp, President and Chief Executive Officer of Culp
