Culp Comes in Below Expectations
November 1, 2004,
Hard hit by slowing demand for upholstery fabrics and lower margins in its mattress-ticking business, Culp Fabrics Inc. cautioned that earnings for its second fiscal quarter, which ended Oct. 31, will fall sharply lower than expected.
With sales and profits both under heavy pressure, the company said it will lay off about 250 workers, about 14 percent of employees in the upholstery fabrics business, as it shuts a decorative fabrics weaving plant in Pageland, S.C., shifting operations to a the Graham, N.C., facility.
Additionally, the company will consolidate yarn production, moving operations from a plant in Cherryville, N.C., into another plant in Shelby, N.C.
Robert Culp III, chairman and CEO, said, “Another important element of the restructuring plan will be a substantial reduction in certain raw material and finished goods stock keeping units, or skus, to reduce manufacturing complexities and lower costs” as the company exits unprofitable product lines. “We will continue to identify and eliminate products that are not generating acceptable volumes or margins,” said Culp.