Company: CULP
Filing Date: 2025-03-07
Form Type: 10-Q
Source: 0000950170-25-035191
Chunk: 47

Company: CULP INC
Filing Date: 2025-03-07
Form: 10-Q
Item: Item 1
Chunk 47
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 our cash and cash equivalents (collectively, “cash”) totaled $5.3 million, which represents a decrease of $4.7 million compared with cash of $10.0 million as of April 28, 2024. This decrease was primarily attributable to (i) net cash used in operating activities totaling $9.4 million, and (ii) capital expenditures totaling $2.4 million, partially offset by (iii) net borrowings from our lines of credit totaling $5.4 million and (iv) proceeds from the sale of equipment of $1.5 million.

Our net cash used in operating activities was $9.4 million during the first nine months of fiscal 2025, an increase of $3.4 million compared with net cash used in operating activities of $6.0 million during the first nine months of fiscal 2024. This trend mostly reflects (i) a significant decrease in cash earnings, (ii) an increase in inventory purchases to maintain an appropriate level during the company's restructuring activities, as described below in the section titled “—Segment Analysis—Mattress Fabrics Segment—Restructuring Activities,” and (iii) an increase in accounts receivable primarily due to longer payment trends related to a higher sales mix with customers with longer credit terms, partially offset by higher accounts payable due to an increase in inventory purchases from significant vendors who extended their payment terms during the first nine months of fiscal 2025 compared with the first nine months fiscal 2024.

As of January 26, 2025, we had outstanding borrowings totaling $5.4 million under a line of credit agreement associated with our operations located in China.

I-35

Segment Analysis

Mattress Fabrics Segment

    Three Months Ended

    (dollars in thousands)
     
    January 26,2025
     
    January 28,2024
     
    Change

    Net sales
     
    $
    28,642
     
    $
    30,021
     
    (4.6)%

    Gross profit

    2,743

    1,520
     
    80.5%

    Gross profit margin

    9.6
    %
     
    5.1
    %
    450bp

    Selling, general, and administrative expenses

    3,176

    3,102
     
    2.4%

    Restructuring expense