0001564590-20-043218 | 10-Q | XBRL Viewer

Cash and cash equivalents

Inventory

$ 40,402

$ 47,593

$ 47,907

^[1]

39,986

44,236

69,790

^[1]

Short-term investments - available for sale

983

923

^[1]

Short-term investments - held-to-maturity

5,092

4,271

^[1]

Current income taxes receivable

782

776

1,585

^[1]

Current assets - discontinued operation

3,557

Other current assets

3,547

2,617

2,116

^[1]

593

486

793

^[1]

42,051

45,475

43,147

^[1]

Long-term investments - rabbi trust

6,443

5,488

3,903

^[1]

Goodwill

13,569

Intangible assets

3,286

3,805

3,380

^[1]

7,916

7,347

7,834

^[1]

Long-term investments - held-to-maturity

1,314

2,076

^[1]

Noncurrent income taxes receivable

733

Other assets

540

526

664

^[1]

Noncurrent assets - discontinued operation

23,058

1,759

1,520

1,602

^[1]

184,587

226,247

215,084

^[1]

^[2]

726

909

Operating Segments [Member]

1,822

1,905

117,919

121,130

118,912

Operating Segments [Member] | Mattress Fabrics [Member]

1,822

1,905

Accounts receivable

15,585

12,632

12,212

Inventory

20,070

24,410

26,620

^[3]

39,597

43,211

40,682

^[4]

832

235

362

1,759

1,520

1,602

77,843

82,008

81,478

^[2]

545

669

Operating Segments [Member] | Upholstery Fabrics [Member]

1,631

1,620

Accounts receivable

14,308

11,029

12,881

Inventory

20,332

23,183

21,287

^[5]

1,634

1,856

1,633

^[6]

3,802

3,054

1,633

40,076

39,122

37,434

^[2]

113

184

Operating Segments [Member] | Discontinued Operation [Member]

191

190

Unallocated Corporate [Member]

Cash and cash equivalents

39,986

44,236

69,790

Short-term investments - available for sale

983

923

Short-term investments - held-to-maturity

5,092

4,271

Current income taxes receivable

782

776

1,585

Current assets - discontinued operation

3,557

Other current assets

3,547

2,617

2,116

593

486

793

^[7]

820

408

832

Long-term investments - rabbi trust

^[8]

1,809

2,199

1,908

Goodwill

13,569

Intangible assets

3,286

3,805

3,380

7,916

7,347

7,834

Long-term investments - held-to-maturity

1,314

2,076

Noncurrent income taxes receivable

733

Other assets

540

526

664

Long-term note receivable affiliated with discontinued operation

1,800

Noncurrent assets - discontinued operation

23,058

184,587

226,247

$ 215,084

Organization Consolidation And Presentation Of Financial Statements [Abstract]

^[2]

$ 68

$ 56

[1]	Derived from audited financial statements.
[2]	Capital expenditure amounts are stated on the accrual basis. See Consolidated Statements of Cash Flows for capital expenditure amounts on a cash basis.
[3]	The $39.6 million as of August 2, 2020, represents property, plant, and equipment of $27.0 million and $12.6 million located in the U.S. and Canada, respectively. The $43.2 million as of August 4, 2019, represents property, plant, and equipment of $31.2 million and $12.0 million located in the U.S. and Canada, respectively. The $40.7 million as of May 3, 2020, represents property, plant, and equipment of $27.7 million and $13.0 million located in the U.S. and Canada, respectively.
[4]	The $832 as of August 2, 2020 represents right of use assets of $297 and $535 located in the U.S. and Canada, respectively. The $235 as of August 4, 2019, and the $362 as of May 3, 2020, represents right of use assets located in the U.S.
[5]	The $1.6 million as of August 2, 2020, represents property, plant, and equipment of $1.2 million and $456 located in the U.S. and China, respectively. The $1.9 million as of August 4, 2019, represents property, plant, and equipment of $1.3 million and $548 located in the U.S. and China, respectively. The $1.6 million as of May 3, 2020, represents property, plant, and equipment of $1.2 million and $471 located in the U.S. and China, respectively.
[6]	The $3.8 million as of August 2, 2020, represents right of use assets of $3.1 million and $710 located in China and the U.S., respectively. The $3.1 million as of August 4, 2019, represents right of use assets of $1.8 million and $1.3 million located in China and the U.S., respectively. The $1.6 million as of May 3, 2020, represents right of use assets of $857 and $776 located in the U.S. and China, respectively.
[7]	The $820, $408, and $832 as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represent property, plant, and equipment associated with unallocated corporate departments and corporate departments shared by our mattress fabrics and upholstery fabrics segments. Property, plant, and equipment associated with our corporate departments reside in the U.S.
[8]	The $1.8 million, $2.2 million, and $1.9 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represents right of use assets located in the U.S

Basis of Presentation

3 Months Ended

Aug. 02, 2020

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited consolidated financial statements of Culp, Inc. and its majority-owned subsidiaries (the “company”) include all adjustments, which are, in the opinion of management, necessary for fair presentation of the results of operations and financial position. All of these adjustments are of a normal recurring nature. Results of operations for interim periods may not be indicative of future results. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements, which are included in the company’s annual report on Form 10-K filed with the Securities and Exchange Commission on July 17, 2020, for the fiscal year ended May 3, 2020.

The company’s three-months ended August 2, 2020, and August 4, 2019, represent 13-week and 14-week periods, respectively.

Cash Flow Information - Interest and Income Taxes Paid (Detail) - USD ($)

3 Months Ended

Aug. 02, 2020

Aug. 04, 2019

Supplemental Cash Flow Elements [Abstract]

Interest

$ 60,000

Income taxes

^[1],[2]

$ 9,000

$ 1,822,000

[1]

In accordance with the provisions of the 2017 Tax Cuts and Jobs Act, corporate taxpayers were eligible to treat prior AMT credit carryforwards as refundable. Accordingly, we elected to treat our prior AMT credit carryforward balance of $1.5 million as refundable, and as a result, 50% of the $1.5 million refundable balance was expected to be received in each our fiscal years 2021 and 2022, respectively. Net income taxes paid for the three-month period ending August 2, 2020, included our first 50% installment of our refundable balance totaling $746,000.

[2]

The net income tax payments totaling $9,000 during the first quarter of fiscal 2021 included income tax payments associated with our foreign jurisdictions totaling $755,000 that were mostly offset by the U.S. income tax refund of $746,000 received during the first quarter of fiscal 2021 as referenced in note (1) above. The income tax payments totaling $1.8 million during the first quarter of fiscal 2020, represented income tax payments associated with our foreign jurisdictions totaling $984,000 and a withholding tax payment of $838,000 paid to the Chinese government for earnings and profits repatriated to the U.S. parent company.

Income Taxes - U.S. Tax Law Change - Narrative (Detail) - GILTI [Member] - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Aug. 02, 2020	May 03, 2020	Apr. 28, 2019
Income Taxes [Line Items]
Income tax charge of during period		$ 1.9	$ 2.1
Non-cash income tax benefit/charges	$ 3.5

Allowance for Doubtful Accounts - Summary of the Activity in the Allowance for Doubtful Accounts (Detail) - Allowance for doubtful accounts [Member] - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	$ 472	$ 393
Provision for bad debts	80	(30)
Ending balance	$ 552	$ 363

Investment in Unconsolidated Joint Venture

3 Months Ended

Aug. 02, 2020

Equity Method Investments And Joint Ventures [Abstract]

Investment in Unconsolidated Joint Venture

8. Investment in Unconsolidated Joint Venture

Culp International Holdings, Ltd. (Culp International), a wholly-owned subsidiary of the company, entered into a joint venture agreement pursuant to which Culp International owns fifty percent of Class International Holdings, Ltd. (CLIH). CLIH produces cut and sewn mattress covers in an 80,000 square foot facility located in a modern industrial park on the northeastern border of Haiti, which borders the Dominican Republic. CLIH complements our mattress fabric operations with a reactive platform that enhances our ability to meet customer demand while adding a lower cost operation to our platform.

On December 20, 2019, CLIH entered into an agreement to construct an additional plant facility totaling 40,000 square feet, which is currently expected to be completed during the second quarter of fiscal 2021. This new plant facility will be near our existing operations and will provide additional capacity that will enhance our ability to produce sewn covers. This agreement requires payments totaling $1.2 million, of which $600,000 was paid in February 2020, $180,000 was paid May 2020, and the remaining balance of $420,000 is to be paid upon completion.

CLIH reported net income totaling $134,000 and $26,000 for the three-month periods ending August 2, 2020, and August 4, 2019, respectively. Our equity interest in CLIH’s net income was $67,000 and $13,000 for the three-month periods ending August 2, 2020, and August 4, 2019, respectively.

The following table summarizes information on assets, liabilities, and members’ equity of our equity method investment in CLIH:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Total assets	$	3,668	$	3,161	$	3,338
Total liabilities	$	149	$	120	$	133
Total members’ equity	$	3,519	$	3,041	$	3,205

As of August 2, 2020, August 4, 2019, and May 3, 2020, our investment in CLIH totaled $1.8 million, $1.5 million, and $1.6 million, respectively, which represents the company’s fifty percent ownership interest in CLIH.

Fair Value of Financial Instruments - Recurring Basis (Detail) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Premier Money Market Fund [Member]
Assets:
Investments at fair value	$ 7,533	$ 7,496	$ 6,920
Short Term Bond Funds [Member]
Assets:
Investments at fair value	983	923
Growth Allocation Fund [Member]
Assets:
Investments at fair value	246	219	213
Moderate Allocation Fund [Member]
Assets:
Investments at fair value	71	63	130
Other [Member]
Assets:
Investments at fair value	66	56	84
Quoted prices in active markets for identical assets - Level 1 [Member] \| Premier Money Market Fund [Member]
Assets:
Investments at fair value	7,533	7,496	6,920
Quoted prices in active markets for identical assets - Level 1 [Member] \| Short Term Bond Funds [Member]
Assets:
Investments at fair value	983	923
Quoted prices in active markets for identical assets - Level 1 [Member] \| Growth Allocation Fund [Member]
Assets:
Investments at fair value	246	219	213
Quoted prices in active markets for identical assets - Level 1 [Member] \| Moderate Allocation Fund [Member]
Assets:
Investments at fair value	71	63	130
Quoted prices in active markets for identical assets - Level 1 [Member] \| Other [Member]
Assets:
Investments at fair value	$ 66	$ 56	$ 84

Stock-Based Compensation - Summary of Assumptions Used to Determine Fair Value of Performance Based Restricted Stock Units (Detail) - Performance-Based Restricted Stock Units [Member] - Senior Executives [Member] - $ / shares

Jul. 18, 2019

Aug. 02, 2018

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Closing price of our common stock

$ 18.49

$ 24.35

Expected volatility of our common stock

30.00%

33.50%

Expected volatility of peer companies

^[1],[2]

16.00%

Risk-free interest rate

1.73%

2.74%

Dividend yield

2.10%

1.35%

Correlation coefficient of peer companies

^[1],[2]

0.47%

Minimum [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Expected volatility of peer companies

^[1],[2]

29.90%

Correlation coefficient of peer companies

^[1],[2]

0.00%

Maximum [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Expected volatility of peer companies

^[1],[2]

82.30%

Correlation coefficient of peer companies

^[1],[2]

0.43%

[1]

The expected volatility and correlation coefficient of our peer companies for the August 2, 2018 grant date were based on the Russell 2000 Index, which was approved by the Compensation Committee of our board of directors as the benchmark for determining the market-based total shareholder return component. Since the Russell 2000 Index was the only benchmark for determining the market-based total shareholder return component, no ranges were disclosed for these assumptions.

[2]

The expected volatility and correlation coefficient of our peer companies for the July 18, 2019 grant date were based on peer companies that were approved by the Compensation Committee of our board of directors as an aggregate benchmark for determining the market-based total shareholder return component. Therefore, we disclosed ranges of the expected volatility and correlation coefficient for the companies that represented this peer group.

Leases - Narrative (Detail)	3 Months Ended
Leases - Narrative (Detail)	Aug. 02, 2020 USD ($) Building	Aug. 04, 2019 USD ($)
Lessee, Operating Lease, Option to Extend	renewal options for additional periods ranging up to 10 years
Operating Lease Expenses	$ 658,000	$ 719,000
Upholstery Fabrics [Member] \| China [Member]
Number of buildings extended lease term \| Building	2
Increase in right of use assets and lease liabilities	$ 2,600,000
Mattress Fabrics [Member] \| Canada [Member]
Increase in right of use assets and lease liabilities	$ 550,000
Lease terms	3 years
Lease expiration date	Jun. 30, 2023
Minimum [Member]
Operating Lease Remaining Lease Terms	1 year
Maximum [Member]
Operating Lease Remaining Lease Terms	6 years

Income Taxes - Undistributed Earnings - Narrative (Detail) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Aug. 02, 2020	Aug. 04, 2019	May 03, 2020
Income Tax Disclosure [Abstract]
Dividends received deduction percentage for earnings and profits received from foreign corporation	100.00%	100.00%	100.00%
Dividends received deduction, foreign corporation ownership percentage	10.00%	10.00%	10.00%
Deferred tax liability, undistributed earnings from foreign subsidiaries	$ 3.6	$ 2.9	$ 3.4

Revenue from Contracts with Customers - Disaggregation of Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 64,464	$ 70,719
Transferred at Point in Time [Member] \| Product [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	62,164	68,686
Transferred over Time [Member] \| Services [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	2,300	2,033
Mattress Fabrics [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	36,103	38,859
Mattress Fabrics [Member] \| Transferred at Point in Time [Member] \| Product [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	36,103	38,859
Upholstery Fabrics [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	28,361	31,860
Upholstery Fabrics [Member] \| Transferred at Point in Time [Member] \| Product [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	26,061	29,827
Upholstery Fabrics [Member] \| Transferred over Time [Member] \| Services [Member]
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 2,300	$ 2,033

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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Assets And Liabilities Lessee [Abstract]

Net (Loss) Income from Continuing Operations Per Share - Schedule of Weighted Average Shares Used in the Computation of Basic and Diluted Net (Loss) Income from Continuing Operations Per Share (Detail) - shares shares in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Earnings Per Share [Abstract]
Weighted average common shares outstanding, basic	12,287	12,399
Dilutive effect of stock-based compensation		11
Weighted average common shares outstanding, diluted	12,287	12,410

Leases

3 Months Ended

Aug. 02, 2020

Leases

17. Leases

Overview

We lease manufacturing facilities, office space, distribution centers, and equipment under operating lease arrangements. We determine if an arrangement is a lease at its inception if it conveys the right to control the use of identified property, plant, or equipment for a period of time in exchange for consideration. Operating leases with an initial term of 12 months or less are not recognized in our Consolidated Balance Sheets. We recognize a right of use asset and lease liability on the commencement date of a lease arrangement based on the present value of lease payments over the lease term.

Our operating leases have remaining lease terms of 1 to 6 years, with renewal options for additional periods ranging up to 10 years. A lease term may include renewal options if it is reasonably certain that the option to renew a lease period will be exercised. A renewal option is considered reasonably certain to be exercised if there is a significant economic incentive, as defined in ASC Topic 842, to exercise the renewal option on the date a lease arrangement is commenced. Currently, renewal options are not included in the lease terms for any of our leases, as there is not a significant economic incentive for us to exercise any of our renewal options.

Most of our leases do not provide an implicit interest rate, and as a result, we use our incremental borrowing rate based on information available on the commencement date of a lease arrangement in determining the present value of lease our payments.

Balance Sheet

The right of use asset and lease liabilities associated with our operating leases as of August 2, 2020, August 4, 2019, and May 3, 2020, are as follows:

			(1)
(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Right of use asset	$	6,443	$	6,530	$	3,903
Operating lease liability - current		2,387		2,456		1,805
Operating lease liability – noncurrent		4,214		3,955		2,016

(1)

As of August 4, 2019, right of use assets totaled $6.5 million, of which $5.5 million and $1.0 million were classified as right of use asset and within noncurrent assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheet. At August 4, 2019, operating lease liabilities totaled $6.4 million, of which $2.3 million, $186,000, $3.1 million, and $874,000 were classified as operating lease liability – current, within current liabilities – discontinued operation, operating lease liability – long-term, and within noncurrent liabilities – discontinued operation, respectively, in the accompanying Consolidated Balance Sheet.

Supplemental Cash Flow Information

	Three Months Ended
(dollars in thousands)	August 2, 2020
Operating lease liability payments	$	445
Right of use assets exchanged for lease liabilities		3,154

During the three-month period ending August 2, 2020, we entered into agreements that extended the lease term for two buildings associated with our upholstery fabrics operations located in China through December 2024, resulting in $2.6 million of additional right of use assets and lease liabilities. Also, we entered into a new agreement to lease a warehouse associated with our mattress fabrics operations in Canada. This lease agreement has a three-year term that is set to expire in June 2023, resulting in a $550,000 additional right of use assets and lease liability.

	Three Months Ended
(dollars in thousands)	August 4, 2019
Operating lease liability payments	$	657
Right of use assets exchanged for lease liabilities		—

Operating lease expense for the three-months ended August 2, 2020, and August 4, 2019, was $658,000 and $719,000, respectively. Short-term lease and variable lease expenses were immaterial for the three-months ended August 2, 2020, and August 4, 2019.

Other Information

Maturity of our operating lease liabilities for the remainder of fiscal 2021, the subsequent next four fiscal years, and thereafter follows:

(dollars in thousands)
2021	$	2,050
2022		1,765
2023		1,350
2024		1,079
2025		663
Thereafter		—
	$	6,907
Less: interest		(306	)
Present value of lease liabilities	$	6,601

As of August 2, 2020, the weighted average remaining lease term and discount rate for our operating leases follows:

	August 2, 2020
Weighted average lease term	3.5 years
Weighted average discount rate		2.78	%

As of August 4, 2019, the weighted average remaining lease term and discount rate for our operating leases follows:

	August 4, 2019
Weighted average lease term	3.5 years
Weighted average discount rate		3.82	%

Home Accessories Segment - Discontinued Operation - Narrative (Detail) - USD ($)		3 Months Ended
	Mar. 31, 2020	Aug. 02, 2020	Aug. 04, 2019
Discontinued Operations [Line Items]
Payment received from royalty agreement		$ 17,000
Leases, monthly payments		$ 445,000	$ 657,000
eLuxury [Member]
Discontinued Operations [Line Items]
Net sales and cost of sales from continuing operations related to inventory shipments			174,000
Unpaid lease payments guarantees percentage		70.00%
Lease agreement expiry date		2024-09
Leases, monthly payments		$ 18,865
eLuxury [Member]
Discontinued Operations [Line Items]
Amount of consideration received in sale of ownership at closing	$ 509,500
Amount of settlement of borrowings payable by eLuxury under the agreement	300,000
Amount of loan, borrowers agreed to repay after closing of sale transaction	$ 1,000,000
Disposal group loan amount closing period after sale transaction	30 days
Outstanding trade accounts payable due from disposal group	$ 613,000
Trade accounts payable, repayment period	60 days
Net sales related to inventory shipments in supply agreement		$ 244,000
eLuxury [Member] \| Discontinued Operations [Member]
Discontinued Operations [Line Items]
Net cash (used in) provided by operating activities discontinued operations			(1,400,000)
Net cash (used in) or provided by investing activities discontinued operation			0
Net cash (used in) provided by financing activities discontinued operations			$ 1,400,000

Fair Value of Financial Instruments - Narrative (Detail) - USD ($)

3 Months Ended

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Short-term Investments

$ 983,000

$ 923,000

$ 0

Amortized cost of held-to-maturity investments

6,400,000

6,300,000

Fair value of held-to-maturity investments

6,500,000

6,400,000

Long-term investments (Rabbi Trust)

7,916,000

7,834,000

^[1]

7,347,000

Tradenames

$ 540,000

540,000

7,232,000

Read Window Products, LLC [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Continuing Operation [Member]

143,000

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Asset impairments - continuing operations

13,600,000

Continuing Operation [Member] | Read Window Products, LLC [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Discontinued Operations [Member] | eLuxury [Member] | Home Accessories [Member]

143,000

Tradenames

540,000

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Discontinued Operations [Member] | eLuxury [Member] | Home Accessories [Member] | Trade Names [Member]

6,600,000

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Discontinued Operations [Member] | eLuxury [Member] | Home Accessories [Member] | Goodwill [Member]

4,200,000

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Minimum [Member] | Investments (Held-To-Maturity) [Member]

2,400,000

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Investment maturity period

2 years

Maximum [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Investment remaining maturity period

2 years

Maximum [Member] | Investments (Held-To-Maturity) [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Investment maturity period

10 years

Short-term Investments [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Accumulated unrealized gain (loss) on investments

$ 6,000

9,000

Current Expected Credit Loses [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Accumulated unrealized gain (loss) on investments

6,000

Long-term Investments (Rabbi Trust) [Member]

Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]

Accumulated unrealized gain (loss) on investments

$ 53,000

$ (19,000)

$ 46,000

[1]	Derived from audited financial statements.

Stock-Based Compensation

3 Months Ended

Aug. 02, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

16. Stock-Based Compensation

Equity Incentive Plan Description

On September 16, 2015, our shareholders approved an equity incentive plan titled the Culp, Inc. 2015 Equity Incentive Plan (the “2015 Plan”). The 2015 Plan authorizes the grant of stock options intended to qualify as incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, and other equity and cash related awards as determined by our Compensation Committee. An aggregate of 1,200,000 shares of common stock were authorized for issuance under the 2015 Plan, with certain sub-limits that would apply with respect to specific types of awards that may be issued as defined in the 2015 Plan.

As of August 2, 2020, there were 683,818 shares available for future equity-based grants under our 2015 plan.

Performance-Based Restricted Stock Units

Senior Executives

We grant performance-based restricted stock units to certain senior executives which could earn up to a certain number of shares of common stock if certain performance targets are met over a three-fiscal year performance period as defined in the related restricted stock unit agreements. The number of shares of common stock that are earned based on the performance targets that have been achieved may be adjusted based on a market-based total shareholder return component as defined in the related restricted stock unit agreements.

Compensation cost for share-based awards is measured based on their fair market value on the date of grant. The fair market value per share was determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock for the performance-based component.

There were no performance-based restricted stock units granted to certain senior executives during the three-months ended August 2, 2020.

The following table provides assumptions used to determine the fair market value of the market-based total shareholder return component using the Monte Carlo simulation model on our outstanding performance-based restricted units granted to certain senior executives on July 18, 2019 and August 2, 2018:

	July 18,			August 2,
	2019			2018
Closing price of our common stock	$	18.49		$	24.35
Expected volatility of our common stock		30.0	%		33.5	%
Expected volatility of peer companies (1) (2)	29.9% - 82.3%				16.0	%
Risk-free interest rate		1.73	%		2.74	%
Dividend yield		2.10	%		1.35	%
Correlation coefficient of peer companies (1) (2)	0.00 - 0.43				0.47

(1)

(2)

Key Employees and a Non-Employee

We grant performance-based restricted stock units which could earn up to a certain number of shares of common stock if certain performance targets are met over a three-fiscal year performance period as defined in the related restricted stock unit agreements.

Our performance-based restricted stock units granted to key employees were measured based on the fair market value (the closing price of our common stock) on the date of grant. No market-based total shareholder return component was included in these awards. Our performance-based restricted stock units granted to a non-employee, which vested during the first quarter of fiscal 2020, were measured based on the fair market value (closing price of our common stock) on the date when the performance criteria were met.

There were no performance-based restricted stock units granted to our key employees or any non-employees during the three-months ended August 2, 2020.

Overall

The following table summarizes information related to our grants of performance-based restricted stock units associated with certain senior executives and key employees that are currently unvested as of August 2, 2020:

	(3)		(4)
	Performance-Based		Restricted Stock
	Restricted Stock		Units Expected
Date of Grant	Units Awarded		to Vest		Price Per Share			Vesting Period
July 18, 2019 (1)		93,653		—	$	19.04	(5)	3 years
July 18, 2019 (2)		29,227		—	$	18.49	(7)	3 years
August 2, 2018 (1)		86,599		—	$	18.51	(6)	3 years
August 2, 2018 (2)		47,800		—	$	24.35	(7)	3 years

(1)	Performance-based restricted stock units awarded to certain senior executives.

(2)	Performance-based restricted stock units awarded to key employees.

(3)	Amounts represent the maximum number of common stock shares that could be earned if certain performance targets are met as defined in the related restricted stock unit agreements.

(4)

Compensation cost is based on an assessment each reporting period to determine the probability if certain performance goals will be met as of the end of the vesting period, and in turn the number of shares that are expected to be awarded at the end vesting period. These amounts represent the number of shares that were expected to vest as of August 2, 2020.

(5)

Price per share represents the fair market value per share ($1.03 per $1 or an increase of $0.55 to the closing price of our common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($18.49) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on July 18, 2019.

(6)

Price per share represents the fair market value per share ($0.76 per $1 or a reduction of $5.84 to the closing price of the common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($24.35) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on August 2, 2018.

(7)	Price per share represents the closing price of our common stock on the date of grant.

The following table summarizes information related to our performance-based restricted stock units that vested during the three-month periods ending August 2, 2020 and August 4, 2019:

	Performance-Based
	Restricted Stock		(3)		Price
Fiscal Year	Units Vested		Fair Value		Per Share
Fiscal 2021 (1)		3,277	$	33	$	9.96	(4)
Fiscal 2021 (1)		3,710	$	37	$	9.96	(4)
Fiscal 2020 (1)		11,351	$	197	$	17.36	(4)
Fiscal 2020 (2)		4,961	$	86	$	17.36	(4)

(1)	Certain senior executives and key employees.

(2)	Non-employee

(3)	Dollar amounts are in thousands.

(4)	Price per share is derived from the closing price of our common stock on the date the respective performance based restricted stock units vested.

We recorded a (credit) or a charge to compensation expense of $(11,000) and compensation expense of $68,000 within selling, general, and administrative expenses for the three-month periods ending August 2, 2020, and August 4, 2019, respectively. Compensation cost is recorded based on an assessment each reporting period to determine the probability if certain performance goals will be met as of the end of the vesting period. If certain performance goals are not expected to be achieved, compensation cost would not be recorded, and any previously recognized compensation cost would be reversed.

As of August 2, 2020, there were no performance-based restricted stock units expected to vest. Therefore, there was no unrecognized compensation cost related to our outstanding performance-based restricted stock units as of August 2, 2020.

Time-Based Restricted Stock Units

The following table summarizes information related to our grants of time-based restricted stock unit awards associated with certain senior executives and key members of management that are unvested as of August 2, 2020:

	Time-Based
	Restricted Stock
Date of Grant	Units Awarded		Price Per Share			Vesting Period
July 18, 2019		34,399	$	18.49	(1)	3 years
August 2, 2018		10,000	$	24.35	(1)	5 years

(1)	Price per share represents closing price of common stock on the date the respective award was granted.

Overall

We recorded compensation expense of $67,000 and $16,000 within selling, general, and administrative expenses associated with our time-based restricted stock unit awards for the three-month periods ending August 2, 2020, and August 4, 2019, respectively.

As of August 2, 2020, the remaining unrecognized compensation cost related to our time-based restricted stock units was $556,000, which is expected to be recognized over a weighted average vesting period of 2.1 years. As of August 2, 2020, the time-based restricted stock units that are expected to vest had a fair value totaling $493,000.

Common Stock Award

We granted a total of 7,000 shares of common stock to our outside directors on July 1, 2020. These shares of common stock vested immediately and were measured at their fair value on the date of grant. The fair value of this award was $10.00 per share on July 1, 2020, which represents the closing price of our common stock on the date of grant.

We granted a total of 3,659 shares of common stock to our outside directors on July 1, 2019. These shares of common stock vested immediately and were measured at their fair value on the date of grant. The fair value of this award was $19.21 per share on July 1, 2019, which represents the closing price of our common stock on the date of grant.

We recorded $70,000 of compensation expense within selling, general, and administrative expenses for common stock awards to our outside directors for the three-months ending August 2, 2020, and August 4, 2019, respectively.

Allowance for Doubtful Accounts - Narrative (Detail) - USD ($) $ in Thousands	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019	Apr. 28, 2019
Allowance for doubtful accounts [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Allowance for doubtful accounts	$ 552	$ 472	$ 363	$ 393

Inventories - Summary of Inventories (Parenthetical) (Detail) - USD ($)
$ in Thousands

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Inventory [Line Items]

$ 40,402

$ 47,907

$ 50,660

^[1]

$ 40,402

$ 47,907

^[2]

47,593

Inventories [Member]

Inventory [Line Items]

Current Assets - Discontinued Operation [Member]

47,600

Inventory [Line Items]

Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]

$ 3,100

[1]	As of August 4, 2019, inventory totaled $50.7 million, of which $47.6 million and $3.1 million were classified as inventory and within current assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheet.
[2]	Derived from audited financial statements.

Leases - Weighted Average Lease Term and Discount Rate (Detail)	Aug. 02, 2020	Aug. 04, 2019
Lessee Disclosure [Abstract]
Weighted average lease term	3 years 6 months	3 years 6 months
Weighted average discount rate	2.78%	3.82%

Intangible Assets - Summary of Intangible Assets (Detail) - USD ($)	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019	Apr. 28, 2019
Intangible Assets [Line Items]
Tradenames	$ 540,000	$ 540,000	$ 7,232,000
Intangible assets	3,286,000	3,380,000	10,354,000
Customer Relationships [Member]
Intangible Assets [Line Items]
Finite-lived intangible assets, net	2,162,000	2,238,000	2,463,000	$ 2,538,000
Non-Compete Agreement [Member]
Intangible Assets [Line Items]
Finite-lived intangible assets, net	$ 584,000	$ 602,000	$ 659,000	$ 678,000

Home Accessories Segment - Discontinued Operation - Summary of Loss Before Income Tax from Discontinued Operation on Consolidated Statements of Net Income (Detail)
$ in Thousands

3 Months Ended

Aug. 04, 2019

USD ($)

loss before income taxes from discontinued operation

$ (621)

income tax benefit

Net loss from discontinued operation

(610)

Discontinued Operations [Member] | eLuxury [Member]

Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]

net sales

4,302

cost of sales

(3,349)

gross profit

953

selling, general and administrative expenses

(1,562)

interest expense

(20)

^[1]

other income

loss before income taxes from discontinued operation

(621)

income tax benefit

Net loss from discontinued operation

$ (610)

[1]	Interest expense is directly attributable to our discontinued operations as it pertains to loans payable assumed by the buyer, (the former noncontrolling interest holder) or required to be paid to Culp Inc. based on the terms of the sale agreement.

Accrued Expenses - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Payables And Accruals [Abstract]
Compensation, commissions and related benefits	$ 4,549	$ 3,038	$ 3,493
Interest		9	13
Other accrued expenses	3,420	2,807	5,393
Accrued expenses	$ 7,969	$ 5,854	$ 8,899

Segment Information - Statement of Operations for Operating Segments (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Segment Reporting Information [Line Items]
net sales	$ 64,464	$ 70,719
gross profit from continuing operations	9,901	12,412
selling, general, and administrative expenses	8,018	9,149
total income from continuing operations	1,883	3,298
restructuring credit		35
interest expense	(51)
interest income	58	260
other expense	(366)	(95)
income before income taxes from continuing operations	1,524	3,463
Mattress Fabrics [Member]
Segment Reporting Information [Line Items]
net sales	36,103	38,859
Upholstery Fabrics [Member]
Segment Reporting Information [Line Items]
net sales	28,361	31,860
Operating Segments [Member]
Segment Reporting Information [Line Items]
net sales	64,464	70,719
gross profit from continuing operations	9,901	12,412
selling, general, and administrative expenses	8,018	9,149
total income from continuing operations	1,883	3,263
Operating Segments [Member] \| Mattress Fabrics [Member]
Segment Reporting Information [Line Items]
net sales	36,103	38,859
gross profit from continuing operations	4,608	5,691
selling, general, and administrative expenses	2,763	3,071
total income from continuing operations	1,845	2,620
Operating Segments [Member] \| Upholstery Fabrics [Member]
Segment Reporting Information [Line Items]
net sales	28,361	31,860
gross profit from continuing operations	5,293	6,721
selling, general, and administrative expenses	3,180	3,846
total income from continuing operations	2,113	2,875
Unallocated Corporate [Member]
Segment Reporting Information [Line Items]
selling, general, and administrative expenses	2,075	2,232
total income from continuing operations	$ (2,075)	$ (2,232)

Fair Value of Financial Instruments

3 Months Ended

Aug. 02, 2020

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

11. Fair Value of Financial Instruments

ASC Topic 820 establishes a fair value hierarchy that distinguishes between assumptions based on market data (observable inputs) and the company’s assumptions (unobservable inputs). Determining where an asset or liability falls within that hierarchy depends on the lowest level input that is significant to the fair value measurement as a whole. An adjustment to the pricing method used within either level 1 or level 2 inputs could generate a fair value measurement that effectively falls in a lower level in the hierarchy.

The hierarchy consists of three broad levels as follows:

Level 1 – Quoted market prices in active markets for identical assets or liabilities;

Level 2 – Inputs other than level 1 inputs that are either directly or indirectly observable; and

Level 3 – Unobservable inputs developed using the company’s estimates and assumptions, which reflect those that market participants would use.

The determination of where an asset or liability falls in the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each quarter based on various factors and it is possible that an asset or liability may be classified differently from quarter to quarter. However, we expect that changes in classifications between different levels will be rare.

Recurring Basis

The following table presents information about assets measured at fair value on a recurring basis:

Fair value measurements as of August 2, 2020 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

7,533

N/A

7,533

Short Term Bond Funds

983

N/A

983

Growth Allocation Fund

246

N/A

246

Moderate Allocation Fund

N/A

Other

N/A

Fair value measurements as of August 4, 2019 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

6,920

N/A

6,920

Growth Allocation Fund

213

N/A

213

Moderate Allocation Fund

130

N/A

130

Other

N/A

Fair value measurements as of May 3, 2020 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

7,496

N/A

7,496

Short Term Bond Funds

923

N/A

923

Growth Allocation Fund

219

N/A

219

Moderate Allocation Fund

N/A

Other

N/A

Short-Term Investments – Available for Sale

Our short-term investments classified as available for sale consisted of a short-term mutual bond funds and had an accumulated unrealized gain totaling $6,000 as of August 2, 2020, and $9,000, as of May 3, 2020. Our short-term investments classified as available for sale were recorded at their fair values of $983,000, and $923,000 as of August 2, 2020, and May 3, 2020, respectively. As of August 2, 2020, and May 3, 2020, the fair value of our short-term investments approximated their cost basis. There were no short-term investments classified as available for sale on August 4, 2019.

Short-Term and Long-Term Investments - Held-To-Maturity

Our investments classified as held-to-maturity consisted of investment grade U.S. corporate bonds, foreign bonds, and government bonds with original maturities that range from 2 to 10 years, all of which have remaining maturities of less than 2 years as of August 2, 2020. These investments were classified as held-to-maturity as we have the positive intent and ability to hold these investments until maturity. Our held-to-maturity investments were recorded as either current or noncurrent on our Consolidated Balance Sheets, based on the maturity date in relation to the respective reporting period and recorded amortized cost.

As of August 2, 2020, and May 3, 2020, our held-to-maturity investments recorded at amortized cost totaled $6.4 million and $6.3 million, respectively. The fair value of our held-to-maturity investments as of August 2, 2020, and May 3, 2020, totaled $6.5 million and $6.4 million, respectively. There were no investments classified as held-to-maturity on August 4, 2019.

Our bond investments were classified as level 2 as they were traded over the counter within a broker network and not on an active market. The fair value of our bond investments were determined based on a published source that provided an average bid

price. The average bid price was based on various broker prices that were determined based on market conditions, interest rates, and the rating of the respective bond investment.

Current Expected Credit Loses (CECL)- Available for Sale and Held-To-Maturity Investments

As of May 4, 2020, we did not have an allowance for credit losses related to our short-term available for sale and held-to-maturity investments, which are comprised mostly of fixed income securities that are predominantly high-grade U.S. and foreign corporate bonds, U.S. Treasury bonds, and short-term mutual bond funds.

As a result of our adoption of Topic 326 effective May 4, 2020, we determined that our credit loss exposure was immaterial due to the short-term nature of our mutual bond funds and we have experienced historically low unrealized losses and gains during past reporting periods. In addition, it is not our intention to sell or likely that we will be required to sell our held-to-maturity investments before the recovery of their amortized cost basis.

As of August 2, 2020, we reported an accumulated unrealized gain of $6,000 associated with our short-term investments classified as available for sale. As mentioned above, it is not our intention to sell or is likely that we will be required to sell our held-to-maturity investments before the recovery of their amortized cost basis. Accordingly, we did not record any credit loss expense during the three-months ending August 2, 2020.

Long-Term Investments - Rabbi Trust

We have a rabbi trust to set aside funds for participants of our deferred compensation plan (the “Plan”), which enables its participants to credit their contributions to various investment options of the Plan. The investments associated with the rabbi trust consist of a money market fund and various mutual funds that are classified as available for sale.

The long-term investments associated with our rabbi trust were recorded at their fair values of $7.9 million, $7.3 million, and $7.8 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively. The long-term investments associated with our rabbi trust had an accumulated unrealized gain of $53,000 as of August 2, 2020, an unrealized gain of $46,000 as of August 4, 2019, and an unrealized loss of $19,000 as of May 3, 2020. The fair value of our long-term investments associated with our rabbi trust approximates their cost basis.

Other

The carrying amount of our cash and cash equivalents, accounts receivable, other current assets, accounts payable, and accrued expenses approximates fair value because of the short maturity of these financial instruments.

Nonrecurring Basis – Fourth Quarter Fiscal 2020

Continuing Operations

In accordance with ASC Topic 350 Intangibles – Goodwill and Other, we are required to assess our goodwill and tradename for impairment annually or between annual tests if we believe indicators of impairment exist. Accordingly, we performed our annual assessment of goodwill associated with our mattress fabrics segment and goodwill and tradename affiliated with Read as of May 3, 2020. Based on our qualitative assessment we concluded that impairment indicators existed, such as our unfavorable financial performance during the fourth quarter of fiscal 2020 and the significant decline in the price per share of our common stock and market capitalization stemming from the COVID-19 global pandemic. As a result, we determined it was more-likely-than-not that the goodwill associated with our mattress fabrics segment and the goodwill and tradename affiliated with Read were impaired, and therefore, we conducted quantitative asset impairment tests. Consequently, based on the results of our quantitative asset impairment tests as of May 3, 2020, we recorded an asset impairment charge totaling $13.6 million during our fourth quarter of fiscal 2020 for the entire carrying amount of our goodwill associated with our mattress fabrics segment and Read. Additionally, we recorded an asset impairment charge of $143,000 during the fourth quarter of fiscal 2020 which reduced the carrying amount of Read’s tradename to its fair value of $540,000.

Our fair values associated with our goodwill and tradename were determined using a discounted cash flow and the relief from royalty methods, respectively. These methods used significant unobservable inputs, and therefore, the fair values of our goodwill and tradename were classified within level 3 of the fair value hierarchy.

Discontinued Operation – Home Accessories Segment

During the fourth quarter of fiscal 2020, we record asset impairment charges totaling $6.6 million, of which $4.2 million and $2.4 million were for the entire remaining carrying value associated with our former home accessories segment’s tradename and goodwill. These impairment charges were based on the expected selling price of our entire ownership interest in eLuxury in

comparison to its carrying amount. As disclosed in Note 3 of the consolidated financial statements, effective March 31, 2020, we sold our entire ownership interest in eLuxury to its noncontrolling interest holder resulting in the elimination of the home accessories segment at such time. Based on the terms of the sale agreement, we did not receive any consideration for eLuxury’s net assets associated with the sale of our entire ownership in eLuxury. We believe the expected selling price represents a significant observable input and therefore, the fair values of our former home accessories segment’s tradename and goodwill were classified within level 2 of the fair value hierarchy.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Income Taxes - Uncertain Income Tax Positions - Narrative (Detail) - USD ($)	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Income Taxes [Line Items]
Unrecognized tax benefits	$ 1,400,000
Unrecognized tax benefits that would favorably impact effective income tax rate if recognized	1,100,000	$ 1,300,000	$ 914,000
Non-current Deferred Income Taxes [Member]
Income Taxes [Line Items]
Unrecognized tax benefits	380,000
Income Taxes Payable - Long-Term [Member]
Income Taxes [Line Items]
Unrecognized tax benefits	$ 1,100,000	$ 1,300,000	$ 914,000

Home Accessories Segment - Discontinued Operation - Summary of Net (Loss) Income from Continuing Operations, Net Loss from Discontinued Operation, and Net (Loss) Income Attributable to Common Shareholders and Noncontrolling Interest (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
net (loss) income from continuing operations	$ (2,733)	$ 1,784
net loss from discontinued operation		(610)
Net (loss) income	(2,733)	1,174
Discontinued Operations [Member] \| eLuxury [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
net (loss) income from continuing operations	(2,733)	1,784
net (loss) income from continuing operations attributable to Culp Inc. common shareholders	(2,733)	1,784
net loss from discontinued operation		(610)
net loss from discontinued operation attributable to noncontrolling interest		164
net loss from discontinued operation attributable to Culp Inc. common shareholders		(446)
Net (loss) income	(2,733)	1,174
net loss from noncontrolling interest associated with a discontinued operation		164
net (loss) income attributable to Culp Inc. common shareholders	$ (2,733)	$ 1,338

Stock-Based Compensation - Summary of Grants of Performance-Based Restricted Stock Units Associated with Senior Executives and Key Employees (Parenthetical) (Detail) - Performance-Based Restricted Stock Units [Member] - Senior Executives [Member] - $ / shares	Jul. 18, 2019	Aug. 02, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value adjustment to closing price of common stock, percentage	1.03%	0.76%
Fair value adjustment to closing price of common stock, per share	$ 0.55	$ 5.84
Closing price of common stock	$ 18.49	$ 24.35

Leases - Lessee Operating Lease Liability Maturity (Details) - USD ($) $ in Thousands	Aug. 02, 2020	Aug. 04, 2019
Lessee Disclosure [Abstract]
2021	$ 2,050
2022	1,765
2023	1,350
2024	1,079
2025	663
Total	6,907
Less: interest	(306)
Present value of lease liabilities	$ 6,601	$ 6,400

Inventories

3 Months Ended

Aug. 02, 2020

Inventory Disclosure [Abstract]

Senior Executives [Member]

6. Inventories

Inventories are carried at the lower of cost or net realizable value. Cost is determined using the FIFO (first-in, first-out) method.

A summary of inventories follows:

(dollars in thousands)	August 2, 2020		August 4, 2019			May 3, 2020
Raw materials	$	7,742	$	6,467		$	7,823
Work-in-process		2,292		2,677			1,958
Finished goods		30,368		41,516			38,126
	$	40,402	$	50,660	(1)	$	47,907

(1)

As of August 4, 2019, inventory totaled $50.7 million, of which $47.6 million and $3.1 million were classified as inventory and within current assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheet.

Stock-Based Compensation - Summary of Performance-Based Restricted Stock Units Vested (Detail) - Performance-Based Restricted Stock Units [Member] - USD ($)
$ / shares in Units, $ in Thousands

3 Months Ended

Aug. 02, 2020

Aug. 04, 2019

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

^[1]

3,277

^[1],[2]

$ 33

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

^[1],[3]

$ 9.96

Key Employees [Member]

^[1]

3,710

^[1],[2]

$ 37

Key Employees and Senior Executives [Member]

^[1],[3]

$ 9.96

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

^[1]

11,351

^[1],[2]

$ 197

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

^[1],[3]

$ 17.36

Non-employee [Member]

^[4]

4,961

^[2],[4]

$ 86

^[3],[4]

$ 17.36

[1]	Certain senior executives and key employees.
[2]	Dollar amounts are in thousands.
[3]	Price per share is derived from the closing price of our common stock on the date the respective performance based restricted stock units vested.
[4]	Non-employee

Income Taxes - Summary of Valuation Allowances Against Net Deferred Income Taxes (Detail) - USD ($) $ in Thousands	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Valuation Allowance [Line Items]
Valuation allowance	$ 10,111	$ 3,148	$ 711
Capital Loss Carry Forwards and Credits [Member]
Valuation Allowance [Line Items]
Valuation allowance	2,281	2,281
Federal and State [Member] \| Deferred Income Tax Assets [Member]
Valuation Allowance [Line Items]
Valuation allowance	$ 7,830	$ 867	$ 711

Segment Information

3 Months Ended

Aug. 02, 2020

Segment Reporting [Abstract]

Segment Information

14. Segment Information

Overall

Continuing Operations

Our continuing operations are classified into two business segments: mattress fabrics and upholstery fabrics.

Mattress Fabrics

The mattress fabrics segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers.

Upholstery Fabrics

The upholstery fabrics segment develops, manufactures, sources, and sells fabrics primarily to residential and commercial furniture manufacturers. Additionally, the segment includes Read, a wholly-owned subsidiary, which is a turn-key provider of window treatments and sourcing of upholstery fabrics and other products, as well as measuring, and installation services of Read’s own products for the hospitality and commercial industries. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows.

Discontinued Operation – Home Accessories Segment

As disclosed in Note 3 of the consolidated financial statements, we sold our entire ownership interest in eLuxury on March 31, 2020, and consequently our home accessories segment was eliminated at such time. Thus, the results of operations associated with our home accessories segment were excluded from our continuing operations and presented as a discontinued operation in our consolidated financial statements.

Our former home accessories segment was our finished products business that manufactured, sourced, and sold bedding accessories and home goods directly to consumers and businesses through global e-commerce, business-to-business, and other sales channels.

See Note 3 of the consolidated financial statements for detailed financial information of our former home accessories segment. As disclosed in Note 3, a reconciliation is provided that has detailed balance sheet information as of August 4, 2019, that is reconciled to captions titled “current assets – discontinued operation”, “noncurrent assets – discontinued operation”, current liabilities – discontinued operation”, and “noncurrent liabilities – discontinued operation” presented in the Consolidated Balance Sheet as of August 4, 2019. Also, a reconciliation is provided that pertains to detailed income statement information disclosed in Note 3 and is reconciled to net loss from discontinued operation presented in the Consolidated Statements of Net Income for the three-month period ending August 4, 2019.

Financial Information

We evaluate the operating performance of our current business segments based upon income (loss) from continuing operations before certain unallocated corporate expenses, asset impairments, restructuring credit (expense) and restructuring related charges, and other non-recurring items. Cost of sales for each segment includes costs to develop, manufacture, or source our products, including costs such as raw material and finished goods purchases, direct and indirect labor, overhead, and incoming freight charges. Unallocated corporate expenses primarily represent compensation and benefits for certain executive officers and their staff, all costs associated with being a public company, and other miscellaneous expenses. Segment assets include assets used in the operations of each segment and primarily consist of accounts receivable, inventories, property, plant, and equipment, and right of use assets. The mattress fabrics segment also includes in segment assets its investment in an unconsolidated joint venture. Goodwill and intangible assets are not included in segment assets, as these assets are not used by the Chief Operating Decision Maker to evaluate the respective segment’s operating performance, allocate resources to the individual segments, or determine executive compensation.

Statements of operations for our current operating segments are as follows:

	Three months ended
	August 2, 2020			August 4, 2019
net sales by segment:
mattress fabrics	$	36,103		$	38,859
upholstery fabrics		28,361			31,860
net sales	$	64,464		$	70,719
gross profit from continuing operations by segment:
mattress fabrics	$	4,608		$	5,691
upholstery fabrics		5,293			6,721
gross profit from continuing operations	$	9,901		$	12,412
selling, general, and administrative expenses by segment:
mattress fabrics	$	2,763		$	3,071
upholstery fabrics		3,180			3,846
unallocated corporate expenses		2,075			2,232
selling, general, and administrative expenses	$	8,018		$	9,149
income (loss) from continuing operations by segment:
mattress fabrics	$	1,845		$	2,620
upholstery fabrics		2,113			2,875
unallocated corporate expenses		(2,075	)		(2,232	)
subtotal		1,883			3,263
restructuring credit		—			35
total income from continuing operations	$	1,883		$	3,298
interest expense		(51	)		—
interest income		58			260
other expense		(366	)		(95	)
income before income taxes from continuing operations	$	1,524		$	3,463

Balance sheet information for our current operating segments follows:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Segment assets:
Mattress Fabrics
Accounts receivable	$	15,585	$	12,632	$	12,212
Inventory		20,070		24,410		26,620
Property, plant and equipment (1)		39,597		43,211		40,682
Right of use assets (2)		832		235		362
Investment in unconsolidated joint venture		1,759		1,520		1,602
Total mattress fabrics assets		77,843		82,008		81,478
Upholstery Fabrics
Accounts receivable		14,308		11,029		12,881
Inventory		20,332		23,183		21,287
Property, plant and equipment (3)		1,634		1,856		1,633
Right of use assets (4)		3,802		3,054		1,633
Total upholstery fabrics assets		40,076		39,122		37,434
Total segment assets		117,919		121,130		118,912
Non-segment assets:
Cash and cash equivalents		39,986		44,236		69,790
Short-term investments - available for sale		983		—		923
Short-term investments - held-to-maturity		5,092		—		4,271
Current income taxes receivable		782		776		1,585
Current assets - discontinued operation		—		3,557		—
Other current assets		3,547		2,617		2,116
Deferred income taxes		593		486		793
Property, plant and equipment (5)		820		408		832
Right of use assets (6)		1,809		2,199		1,908
Goodwill		—		13,569		—
Intangible assets		3,286		3,805		3,380
Long-term investments - rabbi trust		7,916		7,347		7,834
Long-term investments - held-to-maturity		1,314		—		2,076
Noncurrent income taxes receivable		—		733		—
Other assets		540		526		664
Long-term note receivable affiliated with discontinued operation		—		1,800		—
Noncurrent assets - discontinued operation		—		23,058		—
Total assets	$	184,587	$	226,247	$	215,084

	Three months ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Capital expenditures (7):
Mattress Fabrics	$	545	$	669
Upholstery Fabrics		113		184
Unallocated Corporate		68		56
Total capital expenditures	$	726	$	909
Depreciation expense:
Mattress Fabrics	$	1,631	$	1,620
Upholstery Fabrics		191		190
Discontinued Operation		—		95
Total depreciation expense	$	1,822	$	1,905

(1)

The $39.6 million as of August 2, 2020, represents property, plant, and equipment of $27.0 million and $12.6 million located in the U.S. and Canada, respectively. The $43.2 million as of August 4, 2019, represents property, plant, and equipment of $31.2 million and $12.0 million located in the U.S. and Canada, respectively. The $40.7 million as of May 3, 2020, represents property, plant, and equipment of $27.7 million and $13.0 million located in the U.S. and Canada, respectively.

(2)	The $832 as of August 2, 2020 represents right of use assets of $297 and $535 located in the U.S. and Canada, respectively. The $235 as of August 4, 2019, and the $362 as of May 3, 2020, represents right of use assets located in the U.S.

(3)

The $1.6 million as of August 2, 2020, represents property, plant, and equipment of $1.2 million and $456 located in the U.S. and China, respectively. The $1.9 million as of August 4, 2019, represents property, plant, and equipment of $1.3 million and $548 located in the U.S. and China, respectively. The $1.6 million as of May 3, 2020, represents property, plant, and equipment of $1.2 million and $471 located in the U.S. and China, respectively.

(4)

The $3.8 million as of August 2, 2020, represents right of use assets of $3.1 million and $710 located in China and the U.S., respectively. The $3.1 million as of August 4, 2019, represents right of use assets of $1.8 million and $1.3 million located in China and the U.S., respectively. The $1.6 million as of May 3, 2020, represents right of use assets of $857 and $776 located in the U.S. and China, respectively.

(5)

The $820, $408, and $832 as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represent property, plant, and equipment associated with unallocated corporate departments and corporate departments shared by our mattress fabrics and upholstery fabrics segments. Property, plant, and equipment associated with our corporate departments reside in the U.S.

(6)	The $1.8 million, $2.2 million, and $1.9 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represents right of use assets located in the U.S

(7)	Capital expenditure amounts are stated on the accrual basis. See Consolidated Statements of Cash Flows for capital expenditure amounts on a cash basis.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Assets And Liabilities Lessee [Abstract]

Leases - Lessee Operating Lease Right of Use Assets and Liabilities (Detail) - USD ($)
$ in Thousands

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

^[1]

$ 6,443

$ 3,903

$ 6,530

Operating lease liability – noncurrent

2,387

1,805

2,456

$ 4,214

$ 2,016

$ 3,955

[1]

Intangible Assets

3 Months Ended

Aug. 02, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Intangible Assets

7. Intangible Assets

A summary of intangible assets follows:

(dollars in thousands)	August 2, 2020		August 4, 2019			May 3, 2020
Tradenames	$	540	$	7,232		$	540
Customer relationships, net		2,162		2,463			2,238
Non-compete agreement, net		584		659			602
	$	3,286	$	10,354	(1)	$	3,380

(1)	As of August 4, 2019, intangible assets totaled $10.4 million, of which $3.8 million and $6.6 million were classified as intangible assets and within noncurrent assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheets.

Tradenames

Our tradename totaling $540,000 as of August 2, 2020, pertained to Read, a separate reporting unit within the upholstery fabrics segment. This tradename was determined to have an indefinite useful life at the time of its acquisition, and therefore, is not being amortized. However, we are required to assess this tradename annually or between annual tests if we believe indicators of impairment exist. Based on our assessment as of August 2, 2020, no indicators of impairment existed.

However, during our annual assessment as of May 3, 2020, we performed a qualitative assessment in which we concluded that it was more-likely-than-not that the fair value of Read’s tradename was less than its carrying amount. This conclusion was based on impairment indicators that existed, such as our unfavorable financial performance during the fourth quarter of fiscal 2020 and the significant decline in the price per share of our common stock and market capitalization stemming from the COVID-19 global pandemic. Since we determined it was more-likely-than-not that the fair market value of Read’s tradename was less than its carrying amount, we performed a quantitative impairment test. Our quantitative impairment test involved determining the fair value of Read’s tradename and comparing the respective fair value of Read’s tradename with its carrying amount. Consequently, based on our quantitative impairment test, we recorded an asset impairment charge totaling $143,000 during the fourth quarter of fiscal 2020.

As a result of our quantitative impairment test, we determined the fair value of our tradename was $540,000 using the relief from royalty method. This method used significant unobservable inputs and therefore, the fair value of our tradename was classified as level 3 within the fair value hierarchy.

Customer Relationships

A summary of the change in the carrying amount of our customer relationships follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	2,238		$	2,538
Amortization expense		(76	)		(75	)
Ending balance	$	2,162		$	2,463

Our customer relationships are amortized on a straight-line basis over useful lives ranging from nine to seventeen years.

The gross carrying amount of our customer relationships were $3.1 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively. Accumulated amortization for these customer relationships were $953,000, $652,000 and $877,000 at August 2, 2020, August 4, 2019, and May 3, 2020, respectively.

The remaining amortization expense for the next five fiscal years and thereafter follows: FY 2021 - $226,000; FY 2022 - $301,000; FY 2023 - $301,000; FY 2024 - $301,000; FY 2025 - $301,000; and thereafter - $732,000.

The weighted average amortization period for our customer relationships is 7.4 years as of August 2, 2020.

Non-Compete Agreement

A summary of the change in the carrying amount of our non-compete agreement follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	602		$	678
Amortization expense		(18	)		(19	)
Ending balance	$	584		$	659

Our non-compete agreement is amortized on a straight-line basis over the fifteen-year life of the agreement.

The gross carrying amount of our non-compete agreement was $2.0 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively. Accumulated amortization for our non-compete agreement was $1.5 million as of August 2, 2020, $1.4 million as of August 4, 2019, and $1.4 million as of May 3, 2020.

The remaining amortization expense for the next five years and thereafter follows: FY 2021 - $56,000; FY 2022 - $76,000; FY 2023 - $76,000; FY 2024 - $76,000; FY 2025 - $76,000, and Thereafter - $224,000.

The weighted average amortization period for the non-compete agreement is 7.8 years as of August 2, 2020.

Income Taxes - Effective Income Tax Rate - Narrative (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Income Tax Disclosure [Abstract]
Income taxes	$ 4,324	$ 1,692
Effective income tax rate	283.70%	48.90%

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Inventories - Summary of Inventories (Detail) - USD ($)
$ in Thousands

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Inventory Disclosure [Abstract]

Raw materials

$ 7,742

$ 7,823

$ 6,467

Work-in-process

2,292

1,958

2,677

Finished goods

30,368

38,126

41,516

Schedule of Weighted Average Shares Used in the Computation of Basic and Diluted Net (Loss) Income from Continuing Operations Per Share

$ 40,402

$ 47,907

$ 50,660

^[1]

[1]	As of August 4, 2019, inventory totaled $50.7 million, of which $47.6 million and $3.1 million were classified as inventory and within current assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheet.

Net (Loss) Income from Continuing Operations Per Share (Tables)

3 Months Ended

Aug. 02, 2020

Earnings Per Share [Abstract]

Weighted average shares used in the computation of basic and diluted net (loss) income from continuing operations per share are as follows:

	Three months ended
(amounts in thousands)	August 2, 2020		August 4, 2019
Weighted average common shares outstanding, basic		12,287		12,399
Dilutive effect of stock-based compensation		—		11
Weighted average common shares outstanding, diluted		12,287		12,410

Intangible Assets (Tables)

3 Months Ended

Aug. 02, 2020

Summary of Intangible Assets

A summary of intangible assets follows:

(dollars in thousands)	August 2, 2020		August 4, 2019			May 3, 2020
Tradenames	$	540	$	7,232		$	540
Customer relationships, net		2,162		2,463			2,238
Non-compete agreement, net		584		659			602
	$	3,286	$	10,354	(1)	$	3,380

(1)	As of August 4, 2019, intangible assets totaled $10.4 million, of which $3.8 million and $6.6 million were classified as intangible assets and within noncurrent assets – discontinued operation, respectively, in the accompanying Consolidated Balance Sheets.

Customer Relationships [Member]

Summary of Change in Carrying Amount of Finite-Lived Intangible Assets

A summary of the change in the carrying amount of our customer relationships follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	2,238		$	2,538
Amortization expense		(76	)		(75	)
Ending balance	$	2,162		$	2,463

Non-Compete Agreement [Member]

Summary of Change in Carrying Amount of Finite-Lived Intangible Assets

A summary of the change in the carrying amount of our non-compete agreement follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	602		$	678
Amortization expense		(18	)		(19	)
Ending balance	$	584		$	659

Stock-Based Compensation - Narrative (Detail) - USD ($)

3 Months Ended

Jul. 01, 2020

Jul. 18, 2019

Jul. 01, 2019

Aug. 02, 2018

Aug. 02, 2020

Aug. 04, 2019

Sep. 16, 2015

Performance-Based Restricted Stock Units [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Fair value of units expected to vest

$ 0

Remaining unrecognized compensation cost

Performance-Based Restricted Stock Units [Member] | Selling, General and Administrative Expenses [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Share-based compensation expense

$ (11,000)

$ 68,000

Performance-Based Restricted Stock Units [Member] | Senior Executives [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

93,653

^[1],[2]

86,599

^[1],[2]

Performance-Based Restricted Stock Units [Member] | Key Employees [Member]

^[2]

$ 19.04

^[3]

$ 18.51

^[4]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

29,227

^[1],[5]

47,800

^[1],[5]

Performance-Based Restricted Stock Units [Member] | Non-employee [Member]

^[5],[6]

$ 18.49

$ 24.35

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Time-Based Restricted Stock Units [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Fair value of units expected to vest

$ 493,000

Remaining unrecognized compensation cost

$ 556,000

Weighted average period over which unrecognized compensation cost is expected to be recognized

2 years 1 month 6 days

Time-Based Restricted Stock Units [Member] | Selling, General and Administrative Expenses [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Share-based compensation expense

$ 67,000

16,000

Common Stock Awards [Member] | Selling, General and Administrative Expenses [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Share-based compensation expense

$ 70,000

Common Stock Awards [Member] | Outside Directors [Member] | Immediate Vesting [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

7,000

3,659

2015 Equity Incentive Plan [Member]

$ 10.00

$ 19.21

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Number of common stock authorized for issuance

1,200,000

Number of shares available for future equity based grants

683,818

[1]	Amounts represent the maximum number of common stock shares that could be earned if certain performance targets are met as defined in the related restricted stock unit agreements.
[2]	Performance-based restricted stock units awarded to certain senior executives.
[3]	Price per share represents the fair market value per share ($1.03 per $1 or an increase of $0.55 to the closing price of our common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($18.49) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on July 18, 2019.
[4]	Price per share represents the fair market value per share ($0.76 per $1 or a reduction of $5.84 to the closing price of the common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($24.35) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on August 2, 2018.
[5]	Performance-based restricted stock units awarded to key employees.
[6]	Price per share represents the closing price of our common stock on the date of grant.

Dividend Program - Narrative (Detail) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
	Sep. 02, 2020	Aug. 02, 2020	Aug. 04, 2019
Dividends [Line Items]
Cash dividends paid		$ 1,291	$ 1,241
Quarterly Dividend [Member]
Dividends [Line Items]
Cash dividends paid		$ 1,300	$ 1,200
Cash dividend payment, per share		$ 0.105	$ 0.10
Subsequent Event [Member] \| Quarterly Dividend [Member]
Dividends [Line Items]
Cash dividend declared, per share	$ 0.105
Date of payment to shareholders entitled to dividends	Oct. 15, 2020
Date of record of shareholders entitled to dividends	Oct. 08, 2020

Income Taxes (Tables)

3 Months Ended

Aug. 02, 2020

Income Tax Disclosure [Abstract]

Schedule of Allocation of Income Tax Expense

Total income tax expense for the three-month periods ending August 2, 2020, and August 4, 2019, were allocated as follows:

	August 2,		August 4,
(dollars in thousands)	2020		2019
income from continuing operations	$	4,324	$	1,692
loss from discontinued operations		—		(11	)
	$	4,324	$	1,681

Summary of Differences in Income Tax Expense at Federal Income Tax Rate and Effective Income Tax Rate

The following schedule summarizes the principal differences between income tax expense from continuing operations at the U.S. federal income tax rate and the effective income tax rate from continuing operations reflected in the consolidated financial statements for the three-month periods ending August 2, 2020 and August 4, 2019:

	August 2,			August 4,
	2020			2019
U.S. federal income tax rate		21.0	%		21.0	%
U.S. valuation allowance		474.4			—
U.S. income tax law change		(232.5	)		—
Global Intangible Low Taxed Income Tax (GILTI)		—			13.6
Foreign income tax rate differential		19.6			10.2
Other		1.2			4.1
		283.7	%		48.9	%

Summary of Valuation Allowances Against Net Deferred Income Taxes

Based on our assessments as of August 2, 2020, August 4, 2019, and May 3, 2020, valuation allowances against our net deferred income taxes pertain to the following:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
U.S. Federal and State net deferred income tax assets	$	7,830		711		867
U.S. capital loss carryforward		2,281		—		2,281
	$	10,111		711		3,148

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Aug. 02, 2020	Sep. 08, 2020
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Aug. 02, 2020
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Entity Registrant Name	CULP INC
Entity Central Index Key	0000723603
Current Fiscal Year End Date	--05-02
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Trading Symbol	CULP
Entity Common Stock, Shares Outstanding		12,297,830
Entity File Number	1-12597
Entity Tax Identification Number	56-1001967
Entity Address, Address Line One	1823 Eastchester Drive
Entity Address, City or Town	High Point
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27265-1402
City Area Code	336
Local Phone Number	889-5161
Entity Incorporation, State or Country Code	NC
Title of 12(b) Security	Common Stock, par value $.05/ Share
Security Exchange Name	NYSE
Document Quarterly Report	true
Document Transition Report	false

Allowance for Doubtful Accounts (Tables)

3 Months Ended

Aug. 02, 2020

Receivables [Abstract]

Summary of the Activity in the Allowance for Doubtful Accounts

A summary of the activity in the allowance for doubtful accounts follows:

	Three Months Ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Beginning balance	$	472	$	393
Provision for bad debts		80		(30	)
Net write-offs, net of recoveries		—		—
Ending balance	$	552	$	363

Net (Loss) Income from Continuing Operations Per Share

3 Months Ended

Aug. 02, 2020

Earnings Per Share [Abstract]

Net (Loss) Income from Continuing Operations Per Share

13. Net (Loss) Income from Continuing Operations Per Share

Basic net (loss) income from continuing operations per share is computed using the weighted-average number of shares outstanding during the period. Diluted net (loss) income from continuing operations per share uses the weighted-average number of shares outstanding during the period plus the dilutive effect of stock-based compensation calculated using the treasury stock method.

Weighted average shares used in the computation of basic and diluted net (loss) income from continuing operations per share are as follows:

	Three months ended
(amounts in thousands)	August 2, 2020		August 4, 2019
Weighted average common shares outstanding, basic		12,287		12,399
Dilutive effect of stock-based compensation		—		11
Weighted average common shares outstanding, diluted		12,287		12,410

During the first quarter of fiscal 2021, 27,153 shares of unvested common stock were not included in the computation of diluted net loss from continuing operations per share, as their effect would be antidilutive as result a result of the decrease in the price per share of our common stock during the reporting period in relation to the price per share of our common stock as of the respective grant dates of our stock-based compensation awards. During the first quarter of fiscal 2021, an additional 6,675 shares of unvested common stock were not included in the computation of diluted net loss from continuing operations per share, as we incurred a net loss, in which their effect would be antidilutive. During the first quarter of fiscal 2020, 612 shares of unvested common stock were not included in the computation of diluted net income from continuing operations per share as their effect would be antidilutive, as result of the decrease in the price per share of our common stock during the reporting period in relation to the price per share of our common stock as of the respective grant dates of our stock-based compensation awards.

Income Taxes - Differences Between Income Tax Expense from Continuing Operations at Federal Income Tax Rate and Effective Income Tax Rate (Detail)	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Income Tax Disclosure [Abstract]
U.S. federal income tax rate	21.00%	21.00%
U.S. valuation allowance	474.40%
U.S. income tax law change	(232.50%)
Global Intangible Low Taxed Income Tax (GILTI)		13.60%
Foreign income tax rate differential	19.60%	10.20%
Other	1.20%	4.10%
Effective income tax rate	283.70%	48.90%

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Statement Of Income And Comprehensive Income [Abstract]
Net (loss) income	$ (2,733)	$ 1,174
Unrealized holding gains on investments, net of tax	69	6
Comprehensive (loss) income	(2,664)	1,180
Plus: Comprehensive loss attributable to noncontrolling interest associated with discontinued operation		164
Comprehensive (loss) income attributable to Culp, Inc. common shareholders	$ (2,664)	$ 1,344

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income. Excludes changes in equity resulting from investments by owners and distributions to owners.

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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Balance (in shares) at Apr. 28, 2019

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($)
$ in Thousands

Total

Common Stock

Capital Contributed in Excess of Par Value

Accumulated Earnings

Accumulated Other Comprehensive (Loss) Income

Shareholders' equity attributable to Culp Inc.

Noncontrolling Interest Discontinued Operation

Balance at Apr. 28, 2019

^[1]

$ 164,247

$ 620

$ 43,694

$ 115,579

$ 40

$ 159,933

$ 4,314

^[1]

12,391,160

Unrealized gain on investments

1,174

1,338

(164)

Stock-based compensation

154

Common stock issued in connection with vesting of performance based restricted stock units

$ 1

(1)

Common stock issued in connection with vesting of performance based restricted stock units (in shares)

12,776

Fully vested common stock award, (in shares)

3,659

Common stock surrendered for withholding taxes payable

(44)

Common stock surrendered for withholding taxes payable (in shares)

(2,581)

Dividends paid

(1,241)

Capital contribution from non-controllinginterest associated with discontinuedoperation

Balance at Aug. 04, 2019

164,336

$ 621

43,803

115,676

$ 160,146

$ 4,190

Balance (in shares) at Aug. 04, 2019

12,405,014

Balance at May. 03, 2020

^[1]

129,698

$ 615

42,582

86,511

(10)

Balance (in shares) at May. 03, 2020

^[1]

12,284,946

Unrealized gain on investments

(2,733)

Stock-based compensation

126

Fully vested common stock award, (in shares)

7,000

Dividends paid

(1,291)

Balance at Aug. 02, 2020

$ 125,869

$ 615

$ 42,708

$ 82,487

$ 59

Balance (in shares) at Aug. 02, 2020

12,291,946

[1]	Derived from audited financial statements.

Cash Flow Information (Tables)

3 Months Ended

Aug. 02, 2020

Supplemental Cash Flow Elements [Abstract]

Schedule of Interest and Income Taxes Paid

Interest and income taxes paid are as follows:

	Three months ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Interest	$	60	$	—
Income taxes (1) (2)		9		1,822

(1)

In accordance with the provisions of the CARES Act, 100% of AMT credit carryforwards for tax years beginning in the 2019 tax year were immediately refundable. Accordingly, we claimed credit for the remaining 50% installment of our refundable AMT credit carryforward in May 2020. We received our remaining 50% installment plus interest totaling $764,000 during the second quarter of fiscal 2021.

(2)

Commitments and Contingencies

3 Months Ended

Aug. 02, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

18. Commitments and Contingencies

Litigation

The company is involved in legal proceedings and claims which have arisen in the ordinary course of business. Management has determined that it is not reasonably possible that these actions, when ultimately concluded and settled, will have a material adverse effect upon the financial position, results of operations, or cash flows of the company.

Accounts Payable – Capital Expenditures

As of August 2, 2020, August 4, 2019, and May 3, 2020, we had total amounts due regarding capital expenditures totaling $333,000, $50,000, and $107,000, respectively, which pertained to outstanding vendor invoices, none of which were financed. These total outstanding amounts were required to be paid based on normal credit terms.

Purchase Commitments – Capital Expenditures

As of August 2, 2020, we had open purchase commitments to acquire equipment for our mattress fabrics segment totaling $2.0 million.

Inventories (Tables)

3 Months Ended

Aug. 02, 2020

Inventory Disclosure [Abstract]

Summary of Inventories

A summary of inventories follows:

(dollars in thousands)	August 2, 2020		August 4, 2019			May 3, 2020
Raw materials	$	7,742	$	6,467		$	7,823
Work-in-process		2,292		2,677			1,958
Finished goods		30,368		41,516			38,126
	$	40,402	$	50,660	(1)	$	47,907

(1)

Lines of Credit and Paycheck Protection Program Loan

3 Months Ended

Aug. 02, 2020

Debt Disclosure [Abstract]

Lines of Credit and Paycheck Protection Program Loan

10. Lines of Credit and Paycheck Protection Program Loan

Revolving Credit Agreement – United States

Our Credit Agreement with Wells Fargo Bank, N.A. (“Wells Fargo”) provides a revolving loan commitment of $30 million, is set to expire on August 15, 2022, and allows us to issue letters of credit not to exceed $1 million.

Interest is charged at a rate (applicable interest rate of 1.75%, 3.68%, and 1.75% as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively) as a variable spread over LIBOR based on our ratio of debt to EBITDA.

Outstanding borrowings are secured by a pledge of 65% of the common stock of Culp International Holdings Ltd. (our subsidiary located in the Cayman Islands), as required by the Credit Agreement.

As a result of the COVID-19 global pandemic and the uncertainty relating to the unknown duration and overall effect on the company, we proactively took a precautionary measure and borrowed the maximum amount available from this line of credit during the fourth quarter of fiscal 2020. Consequently, we had outstanding borrowings of $29.8 million under the Credit Agreement as of May 3, 2020. During June 2020, we repaid the entire $29.8 million outstanding balance, and as a result, there were no borrowings outstanding under the Credit Agreement as of August 2, 2020. Additionally, there were no borrowings outstanding under the Credit Agreement as of August 4, 2019.

As of August 2, 2020, August 4, 2019, and May 3, 2020, there were $250,000 in outstanding letters of credit (all of which related to workers compensation) provided by the Credit Agreement. As of August 2, 2020, we had $750,000 remaining for the issuance of additional letters of credit.

Seventh Amendment to the Credit Agreement

Effective June 30, 2020, we entered into a Seventh Amendment to our Credit Agreement which includes provisions that (i) modify the method for calculating the company’s debt to EBITDA covenant under the Credit Agreement solely during the temporary period beginning on the date of the Seventh Amendment and ending on the Rate Determination Date (as defined in the Credit Agreement), next following the end of the company’s fiscal 2021 fourth quarter (such temporary period, the “Modification Period,”), and (ii) amend the pricing matrix used to determine the interest rate payable on loans made under the Credit Agreement solely during the Modification Period.

Specifically, the Seventh Amendment provides that during Modification Period, the company’s ratio of debt to EBITDA shall be determined by excluding the fourth quarter of fiscal 2020 from the calculation thereof, such that the ratio shall be determined using the four most recent quarterly periods other than (i.e. excluding) the fourth quarter of fiscal 2020, rather than calculating on a rolling four-quarter basis. It further provides that during the Modification Period, the Applicable Margin (as defined in the Credit Agreement) set forth the pricing matrix is increased to 1.6% for price level I, 2.05% for price level II, 2.5% for price level III, and 3.00% for price level IV.

Additionally, the Seventh Amendment (i) changes the capital expenditure covenant by reducing permitted annual capital expenditures to $10 million during fiscal year 2021, (ii) changes the liens and other indebtedness covenant to reduce the permitted amount of allowable liens and other indebtedness to 5% of consolidated net worth, and (iii) adds a new covenant that prohibits the company, solely during the Modification Period, from paying dividends or repurchasing stock in excess of $10 million in the aggregate during the Modification Period.

Revolving Credit Agreement – China

We have an unsecured credit agreement associated with our operations in China that provides for a line of credit up to 40 million RMB’s ($5.7 million USD as of August 2, 2020). This agreement has an interest rate determined by the Chinese government at the time of borrowing and is set to expire on December 4, 2020. As of May 3, 2020, there were outstanding borrowings under the agreement totaling $1.0 million, at an applicable interest rate of 2.41%. During June 2020, we repaid the entire $1.0 million outstanding balance, and as a result, there were no borrowings outstanding under the agreement as of August 2, 2020. Additionally, there were no borrowings outstanding under the agreement as of August 4, 2019.

Small Business Administration - Paycheck Protection Program

On April 15, 2020, we received a loan of $7.6 million (the “Loan”) pursuant to the U.S. Small Business Administration (the “SBA”) Paycheck Protection Program (the “PPP”) of the Coronavirus Aid, Relief and Economic Security Act of 2020 (the “CARES Act”). We planned to use the proceeds from the Loan for covered payroll costs, rent, and utilities in accordance with the applicable terms and conditions of the CARES Act. We believed the Loan would enable us to retain more of our employees, maintain payroll and benefits, and make lease and utility payments while producing and supplying critical products for essential businesses during the COVID-19 global pandemic.

Following our application and receipt of the Loan, the SBA and U.S. Treasury Department issued new guidance regarding eligibility requirements under the PPP, raising questions regarding the eligibility of publicly traded companies to receive loans under the program. As a result, out of an abundance of caution, we voluntarily repaid the Loan in full on May 13, 2020.

Overall

Our loan agreements require, among other things, that we maintain compliance with certain financial covenants. As of August 2, 2020, we were in compliance with these financial covenants.

Statutory Reserves

3 Months Ended

Aug. 02, 2020

Statutory Reserves

19. Statutory Reserves

Our subsidiaries located in China are required to transfer 10% of their net income, as determined in accordance with the People’s Republic of China (PRC) accounting rules and regulations, to a statutory surplus reserve fund until such reserve balance reaches 50% of the company’s registered capital.

The transfer to this reserve must be made before distributions of any dividend to shareholders. As of August 2, 2020, the company’s statutory surplus reserve was $4.2 million, representing 10% of accumulated earnings and profits determined in accordance with PRC accounting rules and regulations. The surplus reserve fund is non-distributable other than during liquidation and can be used to fund previous years’ losses, if any. The surplus reserve fund may be utilized for business expansion or converted into share capital by issuing new shares to existing shareholders in proportion to their shareholding or by increasing the par value of the shares currently held by them provided that the remaining reserve balance after such issue is not less than 25% of the registered capital.

Our subsidiaries located in China can transfer funds to the parent company except for the statutory surplus reserve of $4.2 million to assist with debt repayment, capital expenditures, and other expenses of the company’s business.

Accrued Expenses

3 Months Ended

Aug. 02, 2020

Accrued Expenses

9. Accrued Expenses

A summary of accrued expenses follows:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Compensation, commissions and related benefits	$	4,549	$	3,493	$	3,038
Interest		—		13		9
Other accrued expenses		3,420		5,393		2,807
	$	7,969	$	8,899	$	5,854

As of August 2, 2020, we had accrued expenses totaling $8.0 million, of which $7.9 million and $117,000 were classified as current accrued expenses and long-term accrued expenses, respectively, in the accompanying Consolidated Balance Sheets. As of August 4, 2019, we had accrued expenses totaling $8.9 million, of which $8.1 million, $333,000, and $462,000 were classified as current accrued expenses, long-term accrued expenses, and current liabilities – discontinued operation, respectively, in the accompanying Consolidated Balance Sheets. As of May 3, 2020, we had accrued expenses totaling $5.9 million, of which $5.7 million and $167,000 were classified as current accrued expenses and long-term accrued expenses, respectively, in the accompanying Consolidated Balance Sheets.

Income Taxes

3 Months Ended

Aug. 02, 2020

Income Tax Disclosure [Abstract]

Income Taxes

15. Income Taxes

Income Tax Expense

Total income tax expense for the three-month periods ending August 2, 2020, and August 4, 2019, were allocated as follows:

	August 2,		August 4,
(dollars in thousands)	2020		2019
income from continuing operations	$	4,324	$	1,692
loss from discontinued operations		—		(11	)
	$	4,324	$	1,681

Effective Income Tax Rate

We recorded income tax expense of $4.3 million, or 283.7% of income before income taxes from continuing operations, for the three-month period ended August 2, 2020, compared with income tax expense of $1.7 million, or 48.9% of income before income taxes from continuing operations, for the three-month period ended August 4, 2019. Our effective income tax rates associated with our continuing operations for the three-month periods ended August 2, 2020, and August 4, 2019, were based upon the estimated effective income tax rate applicable for the full year after giving effect to any significant items related specifically to interim periods. The effective income tax rate can be affected over the fiscal year by the mix and timing of actual earnings from our U.S. operations and foreign subsidiaries located in China and Canada versus annual projections, as well as changes in foreign currency exchange rates in relation to the U.S. dollar.

	August 2,			August 4,
	2020			2019
U.S. federal income tax rate		21.0	%		21.0	%
U.S. valuation allowance		474.4			—
U.S. income tax law change		(232.5	)		—
Global Intangible Low Taxed Income Tax (GILTI)		—			13.6
Foreign income tax rate differential		19.6			10.2
Other		1.2			4.1
		283.7	%		48.9	%

U.S. Tax Law Change

Effective July 20, 2020, the U.S Treasury Department finalized and enacted previously proposed regulations regarding the Global Intangible Low Taxed Income (“GILTI”) tax provisions of the Tax Cuts and Jobs Act of 2017 (“TCJA”). Prior to this enactment, GILTI represented a significant U.S. income tax on our foreign earnings during fiscal 2019 ($2.1 million) and fiscal 2020 ($1.9 million). With the enactment of these final regulations, we are now eligible for an exclusion from GILTI since we meet the provisions for the GILTI High-Tax exception included in the final regulations. In addition, the enactment of the new regulations and our eligibility for the GILTI High-Tax exception are retroactive to the original enactment of the GILTI tax provision, which includes our 2019 and 2020 fiscal years.

As a result of the newly enacted regulations, we recorded a non-cash income tax benefit of $3.5 million resulting from the re-establishment of certain U.S. federal net operating loss carryforwards. This $3.5 million income tax benefit was recorded as a discrete event in which its full income tax effects were recorded in the first quarter of fiscal 2021.

Valuation Allowance

In accordance with ASC Topic 740, we evaluate our deferred income taxes to determine if a valuation allowance is required. ASC Topic 740 requires that companies assess whether a valuation allowance should be established based on the consideration of all available evidence using a “more-likely-than-not” standard, with significant weight being given to evidence that can be objectively verified. Since the company operates in multiple jurisdictions, we assess the need for a valuation allowance on a jurisdiction-by-jurisdiction basis, considering the effects of local tax law.

As a result of the U.S. tax law change relating to the GILTI tax provisions of the TCJA, we assessed the need for an additional valuation allowance against our U.S. net deferred income taxes, as GILTI represented a significant source of our U.S. taxable income during fiscal 2019 and 2020 that offset our U.S. pre-tax losses during such years, and which offset is now reversed as a result of the retroactivity of the new regulations. Consequently, due to the retroactivity of the new regulations, we experienced a recent history of cumulative U.S. taxable losses during our last two fiscal years and we currently expect our history of U.S. pre-tax losses to continue into fiscal 2021, as a result of the continuing economic uncertainty associated with the COVID-19 global pandemic. As a result of the significant weight of this negative evidence, we believe it is more-likely-than-not that our U.S. net deferred income tax assets will not be fully realizable. Accordingly, we recorded a non-cash income tax charge of $7.0 million to provide for a full valuation allowance against our U.S. net deferred income tax assets. This $7.0 million income tax charge was recorded as a discrete event in which its full income tax effects were recorded during the first quarter of fiscal 2021.

Additionally, we recorded a $271,000 income tax charge through our first quarter of fiscal 2021 to provide for a full valuation allowance against a U.S. income tax loss carryforward that is originating during the current fiscal year. The $271,000 was included in our annual effective income tax rate and not treated as a discrete event.

Based on our assessments as of August 2, 2020, August 4, 2019, and May 3, 2020, valuation allowances against our net deferred income taxes pertain to the following:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
U.S. Federal and State net deferred income tax assets	$	7,830		711		867
U.S. capital loss carryforward		2,281		—		2,281
	$	10,111		711		3,148

Undistributed Earnings

In accordance with ASC Topic 740, we assess whether the undistributed earnings from our foreign subsidiaries will be reinvested indefinitely or eventually distributed to our U.S. parent company. As of August 2, 2020, we assessed the liquidity requirements of our U.S. parent company and determined that our undistributed earnings from our foreign subsidiaries would not be reinvested indefinitely and would be eventually distributed to our U.S. parent company. The conclusion reached from our assessment has been consistent with prior years. ASC Topic 740 requires that a deferred tax liability should be recorded for undistributed earnings from foreign subsidiaries that will not be reinvested indefinitely, and as a result we recorded a deferred tax liability associated with undistributed earnings from our foreign subsidiaries. Also, we assess the recognition of U.S. foreign income tax credits associated with foreign withholding and income tax payments and whether it is more-likely-than-not that our foreign income tax credits will not be realized. If it is determined that any foreign income tax credits need to be recognized or it is more-likely-than-not our foreign income tax credits will not be realized, an adjustment to our provision for income taxes will be recognized at that time.

As a result of the TCJA, a U.S. corporation is allowed a 100% dividend received deduction for earnings and profits received from a 10% owned foreign corporation. Therefore, a deferred tax liability will be required only for withholding taxes that are incurred by our foreign subsidiaries at the time earnings and profits are distributed. As a result, as of August 2, 2020, August 4, 2019, and May 3, 2020, we recorded a deferred income tax liability of $3.6 million, $2.9 million, and $3.4 million, respectively, for withholding taxes on undistributed earnings and profits from our foreign subsidiaries.

Uncertain Income Tax Positions

In accordance with ASC Topic 740, an unrecognized income tax benefit for an uncertain income tax position can be recognized in the first interim period if the more-likely-than-not recognition threshold is met by the reporting period, or is effectively settled through examination, negotiation, or litigation, or the statute of limitations for the relevant taxing authority to examine and challenge the tax position has expired. If it is determined that any of the above conditions occur regarding our uncertain income tax positions, an adjustment to our unrecognized income tax benefits will be recorded at that time.

As of August 2, 2020, we had a $1.4 million total gross unrecognized income tax benefit, of which $1.1 million and $380,000 were recorded to income taxes payable-long-term and noncurrent deferred income taxes, respectively, in the accompanying Consolidated Balance Sheets. As of August 4, 2019, we had a $914,000 total gross unrecognized income tax benefit that was recorded to income taxes payable-long-term in the accompanying Consolidated Balance Sheets. As of May 3, 2020, we had a $1.3 million total gross income tax benefit that was recorded to income taxes payable-long term in the accompanying Consolidated Balance Sheets.

As of August 2, 2020, we had a $1.4 million total gross unrecognized income tax benefit, of which $1.1 million would favorably affect the income tax rate in future periods. As of August 4, 2019, the entire $914,000 total gross unrecognized income tax benefit would have favorably affected the income tax rate in future periods. As of May 3, 2020, the entire $1.3 million total gross unrecognized income would have favorably affected the income tax rate in future periods.

Our gross unrecognized income tax benefit of $1.4 million relates to income tax positions for which significant change is currently not expected within the next year. This amount primarily relates to double taxation under applicable income tax treaties with foreign tax jurisdictions.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

Cash and cash equivalents

CONSOLIDATED BALANCE SHEETS - USD ($)

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Current assets:

$ 39,986,000

$ 69,790,000

^[1]

$ 44,236,000

Short-term investments - Held-To-Maturity

5,092,000

4,271,000

^[1]

Short-term investments - Available for Sale

983,000

923,000

^[1]

Accounts receivable, net

29,893,000

25,093,000

^[1]

23,661,000

Current income taxes receivable

40,402,000

47,907,000

^[1]

47,593,000

782,000

1,585,000

^[1]

776,000

Current assets - Discontinued operation

3,557,000

Other current assets

3,547,000

2,116,000

^[1]

2,617,000

Total current assets

120,685,000

151,685,000

^[1]

122,440,000

Property, plant and equipment, net

42,051,000

43,147,000

^[1]

45,475,000

Goodwill

13,569,000

Intangible assets

3,286,000

3,380,000

^[1]

3,805,000

Long-term investments - rabbi trust

7,916,000

7,834,000

^[1]

7,347,000

Long-term investments - Held-To-Maturity

1,314,000

2,076,000

^[1]

Noncurrent income taxes receivable

6,443,000

3,903,000

^[1]

5,488,000

733,000

593,000

793,000

^[1]

486,000

Long-term note receivable affiliated with discontinued operation

1,759,000

1,602,000

^[1]

1,520,000

1,800,000

Noncurrent assets - Discontinued operation

23,058,000

Other assets

540,000

664,000

^[1]

526,000

Line of credit - China operations

184,587,000

215,084,000

^[1]

226,247,000

Current liabilities:

^[1]

1,015,000

Paycheck Protection Program Loan

^[1]

7,606,000

Accounts payable - trade

25,746,000

23,002,000

^[1]

21,855,000

Accounts payable - capital expenditures

333,000

107,000

^[1]

50,000

Accrued restructuring costs

2,387,000

1,805,000

^[1]

2,270,000

Deferred revenue

685,000

502,000

^[1]

684,000

Accrued expenses

7,852,000

5,687,000

^[1]

8,104,000

42,000

Current liabilities - Discontinued operation

1,431,000

Income taxes payable - current

613,000

395,000

^[1]

1,116,000

Total current liabilities

37,616,000

40,119,000

^[1]

35,552,000

Line of credit - U.S. operations

^[1]

29,750,000

Accrued expenses - long-term

117,000

167,000

^[1]

333,000

Operating lease liability - noncurrent

4,214,000

2,016,000

^[1]

3,081,000

Income taxes payable - long-term

3,591,000

3,796,000

^[1]

3,640,000

Contingent consideration affiliated with discontinued operation

5,311,000

1,818,000

^[1]

2,543,000

Deferred compensation

7,869,000

7,720,000

^[1]

7,232,000

5,931,000

Noncurrent liabilities - Discontinued operation

3,599,000

Total liabilities

58,718,000

85,386,000

^[1]

61,911,000

Commitments and Contingencies (Notes 10, 17 and 18)

^[1]

Shareholders' equity

Preferred stock, $0.05 par value, authorized 10,000,000

^[1]

Common stock, $0.05 par value, authorized 40,000,000 shares, issued and outstanding 12,291,946 at August 2, 2020; 12,405,014 at August 4, 2019; and 12,284,946 at May 3, 2020

615,000

^[1]

621,000

Capital contributed in excess of par value

42,708,000

42,582,000

^[1]

43,803,000

Accumulated earnings

82,487,000

86,511,000

^[1]

115,676,000

Accumulated other comprehensive income (loss)

59,000

(10,000)

^[1]

46,000

Total shareholders' equity attributable to Culp Inc.

125,869,000

129,698,000

^[1]

160,146,000

Noncontrolling interest - Discontinued Operation

4,190,000

Total equity

125,869,000

129,698,000

^[1]

164,336,000

Total liabilities and shareholders' equity

$ 184,587,000

$ 215,084,000

^[1]

$ 226,247,000

[1]	Derived from audited financial statements.

Intangible Assets - Narrative (Detail) - USD ($)	3 Months Ended
Intangible Assets - Narrative (Detail) - USD ($)	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Intangible Assets [Line Items]
Tradenames	$ 540,000	$ 540,000	$ 7,232,000
Gross carrying amount of customer relationships	3,100,000	3,100,000	3,100,000
Gross carrying amount of non-compete agreement	2,000,000	2,000,000	2,000,000
Customer Relationships [Member]
Intangible Assets [Line Items]
Accumulated amortization	953,000	877,000	652,000
Remaining amortization expense for the fiscal year	226,000
Remaining amortization expense for the first fiscal year	301,000
Remaining amortization expense for the second fiscal year	301,000
Remaining amortization expense for the third fiscal year	301,000
Remaining amortization expense for the fourth fiscal year	301,000
Remaining amortization expense for the fiscal year thereafter	$ 732,000
Weighted average remaining amortization period	7 years 4 months 24 days
Customer Relationships [Member] \| Minimum [Member]
Intangible Assets [Line Items]
Useful life	9 years
Customer Relationships [Member] \| Maximum [Member]
Intangible Assets [Line Items]
Useful life	17 years
Non-Compete Agreement [Member]
Intangible Assets [Line Items]
Useful life	15 years
Accumulated amortization	$ 1,500,000	1,400,000	$ 1,400,000
Remaining amortization expense for the fiscal year	56,000
Remaining amortization expense for the first fiscal year	76,000
Remaining amortization expense for the second fiscal year	76,000
Remaining amortization expense for the third fiscal year	76,000
Remaining amortization expense for the fourth fiscal year	76,000
Remaining amortization expense for the fiscal year thereafter	$ 224,000
Weighted average remaining amortization period	7 years 9 months 18 days
Read Window Products, LLC [Member]
Intangible Assets [Line Items]
Impairment charge		$ 143,000

Income Taxes - Allocation of Income Tax Expense (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Income Tax Disclosure [Abstract]
income from continuing operations	$ 4,324	$ 1,692
loss from discontinued operations		(11)
Total income tax expense	$ 4,324	$ 1,681

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Section 45
-Paragraph 2
-Subparagraph (b)
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Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.7)
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Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
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-URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32672-109319

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Supplemental Cash Flow Elements [Abstract]

Net (Loss) Income from Continuing Operations Per Share - Narrative (Detail) - Common Stock Awards [Member] - shares	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Antidilutive securities due to decrease in stock price excluded from computation of earnings from continuing operations per share	27,153	612
Shares excluded from computation of diluted net loss from continuing operations per share	6,675

Cash Flow Information

3 Months Ended

Aug. 02, 2020

Cash Flow Information

12. Cash Flow Information

Interest and income taxes paid are as follows:

	Three months ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Interest	$	60	$	—
Income taxes (1) (2)		9		1,822

(1)

(2)

Investment in Unconsolidated Joint Venture - Narrative (Detail)

1 Months Ended

3 Months Ended

May 31, 2020

USD ($)

Feb. 29, 2020

USD ($)

Aug. 02, 2020

USD ($)

ft²

Aug. 04, 2019

USD ($)

May 03, 2020

USD ($)

Dec. 20, 2019

USD ($)

ft²

Schedule of Equity Method Investments [Line Items]

Income (loss) from investment in unconsolidated joint venture

$ (2,733,000)

$ 1,174,000

67,000

13,000

Schedule of Equity Method Investments [Line Items]

$ 1,759,000

1,520,000

$ 1,602,000

^[1]

CLIH [Member]

Equity method investment, ownership percentage

50.00%

Area of facility | ft²

80,000

Area of additional plant facility | ft²

40,000

Contractual obligation

$ 1,200,000

Payments to acquire additional plant facility

$ 180,000

$ 600,000

Payments to acquire additional plant facility, remaining

$ 420,000

Income (loss) from investment in unconsolidated joint venture

67,000

13,000

CLIH [Member] | Equity Method Investment Nonconsolidated Investee Or Group of Investees [Member]

1,800,000

1,500,000

$ 1,600,000

Schedule of Equity Method Investments [Line Items]

$ 134,000

$ 26,000

[1]	Derived from audited financial statements.

Dividend Program

3 Months Ended

Aug. 02, 2020

Significant Accounting Policies

Dividend Program

21. Dividend Program

On September 2, 2020, we announced that our board of directors approved a quarterly cash dividend of $0.105 per share. This payment will be made on or about October 15, 2020, to shareholders of record as of October 8, 2020.

During the three-months ended August 2, 2020, dividend payments totaled $1.3 million, which represented a quarterly dividend payment of $0.105 per share. During the three-months ended August 4, 2019, dividend payments totaled $1.2 million, which represented a quarterly dividend payment of $0.10 per share.

Our board of directors has sole authority to determine if and when we will declare future dividends and on what terms. Future dividend payments are subject to final determination by our board of directors and will depend on our earnings, capital requirements, financial condition, excess availability under our lines of credit, market conditions, and other factors we consider relevant.

Significant Accounting Policies

3 Months Ended

Aug. 02, 2020

Accounting Policies [Abstract]

2. Significant Accounting Policies

As of August 2, 2020, there were no changes in the nature of our significant accounting policies or the application of those policies from those reported in our annual report on Form 10-K for the year then ended May 3, 2020.

Recently Adopted Accounting Pronouncements

Current Expected Credit Losses (CECL)

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which requires entities to use a forward looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. The FASB has subsequently issued updates to the standard to provide additional clarification on specific topics. Topic 326 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. As a result, we adopted the provisions of Topic 326 on May 4, 2020 and applied this guidance during the first quarter of fiscal 2021. The adoption of Topic 326 did not have an impact on our financial position, results of operations, or cash flows. See notes 4 and 11 of our consolidated financial statements for further details of the adoption of CECL as of May 4, 2020 and our assessments and conclusions as of August 2, 2020.

Recently Issued Accounting Pronouncements

The company has considered all recent accounting pronouncements and currently believes there are no recent accounting pronouncements that may have a material impact on our Consolidated Financial Statements.

Allowance for Doubtful Accounts

3 Months Ended

Aug. 02, 2020

Receivables [Abstract]

Allowance for Doubtful Accounts

4. Allowance for Doubtful Accounts

A summary of the activity in the allowance for doubtful accounts follows:

	Three Months Ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Beginning balance	$	472	$	393
Provision for bad debts		80		(30	)
Net write-offs, net of recoveries		—		—
Ending balance	$	552	$	363

During the three-months ended August 2, 2020, we assessed the credit risk of our customers within our accounts receivable. Our risk assessment includes the respective customer’s (i) financial position; (ii) past payment history; (iii) management’s general ability; (iv) historical loss experience; and (v) the ongoing economic uncertainty associated with the COVID-19 global pandemic. After our risk assessment was completed, we assigned credit grades to our customers, which in turn, were used to determine our allowance for doubtful accounts totaling $552,000 as of August 2, 2020.

Intangible Assets - Summary of Change in Carrying Amount of Finite-Lived Intangible Assets (Detail) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Customer Relationships [Member]
Finite Lived Intangible Assets [Line Items]
Beginning balance	$ 2,238	$ 2,538
Amortization expense	(76)	(75)
Ending balance	2,162	2,463
Non-Compete Agreement [Member]
Finite Lived Intangible Assets [Line Items]
Beginning balance	602	678
Amortization expense	(18)	(19)
Ending balance	$ 584	$ 659

Leases - Operating Leases of Lessee Disclosure (Details) - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Lessee Disclosure [Abstract]
Operating lease liability payments	$ 445	$ 657
Right of use assets exchanged for lease liabilities	$ 3,154

Home Accessories Segment - Discontinued Operation - Summary of Disposal of Discontinued Operation on Consolidated Balance Sheet (Detail) $ in Thousands	Aug. 04, 2019 USD ($)
current assets:
total current assets - discontinued operation	$ 3,557
total noncurrent assets - discontinued operation	23,058
current liabilities:
total current liabilities - discontinued operation	1,431
total noncurrent liabilities - discontinued operation	3,599
eLuxury [Member]
current assets:
accounts receivable	429
inventories	3,067
other current assets	61
total current assets - discontinued operation	3,557
property, plant, and equipment	1,814
goodwill	13,653
intangible asset	6,549
right of use asset	1,042
total noncurrent assets - discontinued operation	23,058
total assets	26,615
current liabilities:
accounts payable	783
operating lease liability - current	186
accrued expenses	462
total current liabilities - discontinued operation	1,431
loan payable - Culp Inc.	1,800
subordinated loan payable - noncontrolling interest	925
operating lease liability - long-term	874
total noncurrent liabilities - discontinued operation	3,599
total liabilities	5,030
total net assets of discontinued operation	$ 21,585

Significant Accounting Policies (Policies)

3 Months Ended

Aug. 02, 2020

Accounting Policies [Abstract]

Recently Adopted and Issued Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Current Expected Credit Losses (CECL)

Recently Issued Accounting Pronouncements

Intangible Assets - Summary of Intangible Assets (Parenthetical) (Detail) - USD ($) $ in Thousands	Aug. 02, 2020	May 03, 2020	Aug. 04, 2019
Intangible Assets [Line Items]
Intangible assets	$ 3,286	$ 3,380	$ 10,354
Continuing Operation [Member]
Intangible Assets [Line Items]
Intangible assets			3,800
Discontinued Operation [Member]
Intangible Assets [Line Items]
Intangible assets			$ 6,600

Common Stock Repurchase Program

3 Months Ended

Aug. 02, 2020

Common Stock Repurchase Program

20. Common Stock Repurchase Program

In March 2020, our board of directors approved an authorization for us to acquire up to $5.0 million of our common stock. Under the common stock repurchase program, shares may be purchased from time to time in open market transactions, block trades, through plans established under the Securities Exchange Act Rule 10b5-1, or otherwise. The number of shares purchased, and the timing of such purchases will be based on working capital requirements, market and general business conditions, and other factors, including alternative investment opportunities.

As part of our comprehensive response to the COVID-19 pandemic, we announced on April 3, 2020, that our board of directors temporarily suspended the share repurchase program given the ongoing economic disruption and uncertainty. Accordingly, we did not purchase any shares of our common stock during the three-month period ending August 2, 2020. Additionally, we did not purchase any shares of our common stock during the three-month period ending August 4, 2019.

As of August 2, 2020, we had $5.0 million available for repurchases of our common stock.

Statutory Reserves - Narrative (Detail) - Subsidiaries [Member] - China [Member] $ in Millions	3 Months Ended
	Aug. 02, 2020 USD ($)
Statutory Reserves [Line Items]
Percentage of net income required to be transferred to a statutory surplus reserve fund	10.00%
Maximum required percentage of statutory surplus reserve fund to registered capital	50.00%
Statutory surplus reserve fund balance	$ 4.2
Percentage of accumulated earnings and profits determined in accordance with PRC accounting rules and regulations	10.00%
Minimum threshold percentage for statutory surplus reserve fund as percentage of registered capital, below which certain capital transactions are prohibited	25.00%

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Cash flows from operating activities:
Net (loss) income	$ (2,733)	$ 1,174
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation	1,822	1,905
Amortization	118	176
Stock-based compensation	126	154
Deferred income taxes	3,693	(662)
Gain on disposal of equipment		(17)
Income from investment in unconsolidated joint venture	(67)	(13)
Foreign currency exchange loss (gain)	154	(47)
Changes in assets and liabilities:
Accounts receivable	(4,757)	(375)
Inventories	7,592	(25)
Other current assets	(1,254)	161
Other assets	(24)	111
Accounts payable – trade	2,544	(1,468)
Deferred revenue	183	285
Accrued expenses and deferred compensation	2,377	222
Accrued restructuring costs		(82)
Income taxes	807	524
Net cash provided by operating activities	10,581	2,023
Cash flows from investing activities:
Capital expenditures	(500)	(935)
Proceeds from the sale of equipment		209
Investment in unconsolidated joint venture	(90)
Proceeds from the sale of short-term investments (Held to Maturity)	350	5,000
Purchase of short-term and long-term investments (Held to Maturity)	(423)
Purchase of short-term investments (Available for Sale)	(34)
Proceeds from the sale of long-term investments (Rabbi Trust)	39
Purchase of long-term investments (Rabbi Trust)	(78)	(259)
Net cash (used in) provided by investing activities	(736)	4,015
Cash flows from financing activities:
Payments associated with lines of credit	(30,772)
Payments associated with Paycheck Protection Program Loan	(7,606)
Dividends paid	(1,291)	(1,241)
Cash paid for acquisition of business		(763)
Proceeds from subordinated loan payable associated with the noncontrolling interest of discontinued operation		250
Capital contribution from noncontrolling interest associated with discontinued operation		40
Common stock surrendered for withholding taxes payable		(44)
Payments of debt issuance costs	(15)
Net cash used in financing activities	(39,684)	(1,758)
Effect of exchange rate changes on cash and cash equivalents	35	(52)
(Decrease) increase in cash and cash equivalents	(29,804)	4,228
Cash and cash equivalents at beginning of period	69,790	40,008
Cash and cash equivalents at end of period	$ 39,986	$ 44,236

Segment Information (Tables)

3 Months Ended

Aug. 02, 2020

Segment Reporting [Abstract]

Schedule of Operating Segments Information

Statements of operations for our current operating segments are as follows:

	Three months ended
	August 2, 2020			August 4, 2019
net sales by segment:
mattress fabrics	$	36,103		$	38,859
upholstery fabrics		28,361			31,860
net sales	$	64,464		$	70,719
gross profit from continuing operations by segment:
mattress fabrics	$	4,608		$	5,691
upholstery fabrics		5,293			6,721
gross profit from continuing operations	$	9,901		$	12,412
selling, general, and administrative expenses by segment:
mattress fabrics	$	2,763		$	3,071
upholstery fabrics		3,180			3,846
unallocated corporate expenses		2,075			2,232
selling, general, and administrative expenses	$	8,018		$	9,149
income (loss) from continuing operations by segment:
mattress fabrics	$	1,845		$	2,620
upholstery fabrics		2,113			2,875
unallocated corporate expenses		(2,075	)		(2,232	)
subtotal		1,883			3,263
restructuring credit		—			35
total income from continuing operations	$	1,883		$	3,298
interest expense		(51	)		—
interest income		58			260
other expense		(366	)		(95	)
income before income taxes from continuing operations	$	1,524		$	3,463

Balance sheet information for our current operating segments follows:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Segment assets:
Mattress Fabrics
Accounts receivable	$	15,585	$	12,632	$	12,212
Inventory		20,070		24,410		26,620
Property, plant and equipment (1)		39,597		43,211		40,682
Right of use assets (2)		832		235		362
Investment in unconsolidated joint venture		1,759		1,520		1,602
Total mattress fabrics assets		77,843		82,008		81,478
Upholstery Fabrics
Accounts receivable		14,308		11,029		12,881
Inventory		20,332		23,183		21,287
Property, plant and equipment (3)		1,634		1,856		1,633
Right of use assets (4)		3,802		3,054		1,633
Total upholstery fabrics assets		40,076		39,122		37,434
Total segment assets		117,919		121,130		118,912
Non-segment assets:
Cash and cash equivalents		39,986		44,236		69,790
Short-term investments - available for sale		983		—		923
Short-term investments - held-to-maturity		5,092		—		4,271
Current income taxes receivable		782		776		1,585
Current assets - discontinued operation		—		3,557		—
Other current assets		3,547		2,617		2,116
Deferred income taxes		593		486		793
Property, plant and equipment (5)		820		408		832
Right of use assets (6)		1,809		2,199		1,908
Goodwill		—		13,569		—
Intangible assets		3,286		3,805		3,380
Long-term investments - rabbi trust		7,916		7,347		7,834
Long-term investments - held-to-maturity		1,314		—		2,076
Noncurrent income taxes receivable		—		733		—
Other assets		540		526		664
Long-term note receivable affiliated with discontinued operation		—		1,800		—
Noncurrent assets - discontinued operation		—		23,058		—
Total assets	$	184,587	$	226,247	$	215,084

	Three months ended
(dollars in thousands)	August 2, 2020		August 4, 2019
Capital expenditures (7):
Mattress Fabrics	$	545	$	669
Upholstery Fabrics		113		184
Unallocated Corporate		68		56
Total capital expenditures	$	726	$	909
Depreciation expense:
Mattress Fabrics	$	1,631	$	1,620
Upholstery Fabrics		191		190
Discontinued Operation		—		95
Total depreciation expense	$	1,822	$	1,905

(1)

(2)	The $832 as of August 2, 2020 represents right of use assets of $297 and $535 located in the U.S. and Canada, respectively. The $235 as of August 4, 2019, and the $362 as of May 3, 2020, represents right of use assets located in the U.S.

(3)

(4)

(5)

(6)	The $1.8 million, $2.2 million, and $1.9 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represents right of use assets located in the U.S

(7)	Capital expenditure amounts are stated on the accrual basis. See Consolidated Statements of Cash Flows for capital expenditure amounts on a cash basis.

Revenue from Contracts with Customers (Tables)

3 Months Ended

Aug. 02, 2020

Revenue From Contract With Customer [Abstract]

Summary of Activity Associated with Deferred Revenue

A summary of the activity associated with deferred revenue for the three-month periods ended August 2, 2020, and August 4, 2019, follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	502		$	399
Revenue recognized on contract liabilities		(593	)		(483	)
Payments received for services not yet rendered		776			768
Ending balance	$	685		$	684

Summary of Disaggregation of Revenue

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending August 2, 2020:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	36,103	$	26,061	$	62,164
Services transferred over time		—		2,300		2,300
Total Net Sales	$	36,103	$	28,361	$	64,464

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending August 4, 2019:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	38,859	$	29,827	$	68,686
Services transferred over time		—		2,033		2,033
Total Net Sales	$	38,859	$	31,860	$	70,719

Stock-Based Compensation - Summary of Grants of Performance-Based Restricted Stock Units Associated with Senior Executives and Key Employees (Detail) - Performance-Based Restricted Stock Units [Member] - $ / shares

3 Months Ended

Jul. 18, 2019

Aug. 02, 2018

Aug. 02, 2020

Senior Executives [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Performance-Based Restricted Stock Units Awarded

93,653

^[1],[2]

86,599

^[1],[2]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

^[2]

$ 19.04

^[3]

$ 18.51

^[4]

Vesting Period

^[2]

3 years

Key Employees [Member]

Performance-Based Restricted Stock Units Awarded

29,227

^[1],[5]

47,800

^[1],[5]

Summary of Assumptions Used to Determine Fair Value of Performance Based Restricted Stock Units

^[5],[6]

$ 18.49

$ 24.35

Vesting Period

^[5]

3 years

[1]	Amounts represent the maximum number of common stock shares that could be earned if certain performance targets are met as defined in the related restricted stock unit agreements.
[2]	Performance-based restricted stock units awarded to certain senior executives.
[3]	Price per share represents the fair market value per share ($1.03 per $1 or an increase of $0.55 to the closing price of our common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($18.49) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on July 18, 2019.
[4]	Price per share represents the fair market value per share ($0.76 per $1 or a reduction of $5.84 to the closing price of the common stock on the date of grant) determined using the Monte Carlo simulation model for the market-based total shareholder return component and the closing price of our common stock ($24.35) for the performance-based component of the performance-based restricted stock units granted to certain senior executives on August 2, 2018.
[5]	Performance-based restricted stock units awarded to key employees.
[6]	Price per share represents the closing price of our common stock on the date of grant.

Stock-Based Compensation (Tables)

3 Months Ended

Aug. 02, 2020

	July 18,			August 2,
	2019			2018
Closing price of our common stock	$	18.49		$	24.35
Expected volatility of our common stock		30.0	%		33.5	%
Expected volatility of peer companies (1) (2)	29.9% - 82.3%				16.0	%
Risk-free interest rate		1.73	%		2.74	%
Dividend yield		2.10	%		1.35	%
Correlation coefficient of peer companies (1) (2)	0.00 - 0.43				0.47

(1)

(2)

Performance-Based Restricted Stock Units [Member]

Summary of Vested Restricted Stock Units

The following table summarizes information related to our performance-based restricted stock units that vested during the three-month periods ending August 2, 2020 and August 4, 2019:

	Performance-Based
	Restricted Stock		(3)		Price
Fiscal Year	Units Vested		Fair Value		Per Share
Fiscal 2021 (1)		3,277	$	33	$	9.96	(4)
Fiscal 2021 (1)		3,710	$	37	$	9.96	(4)
Fiscal 2020 (1)		11,351	$	197	$	17.36	(4)
Fiscal 2020 (2)		4,961	$	86	$	17.36	(4)

(1)	Certain senior executives and key employees.

(2)	Non-employee

(3)	Dollar amounts are in thousands.

(4)	Price per share is derived from the closing price of our common stock on the date the respective performance based restricted stock units vested.

Executive officers and key employees [Member]

Summary of Grants of Performance-Based Restricted Stock Units

	(3)		(4)
	Performance-Based		Restricted Stock
	Restricted Stock		Units Expected
Date of Grant	Units Awarded		to Vest		Price Per Share			Vesting Period
July 18, 2019 (1)		93,653		—	$	19.04	(5)	3 years
July 18, 2019 (2)		29,227		—	$	18.49	(7)	3 years
August 2, 2018 (1)		86,599		—	$	18.51	(6)	3 years
August 2, 2018 (2)		47,800		—	$	24.35	(7)	3 years

(1)	Performance-based restricted stock units awarded to certain senior executives.

(2)	Performance-based restricted stock units awarded to key employees.

(3)	Amounts represent the maximum number of common stock shares that could be earned if certain performance targets are met as defined in the related restricted stock unit agreements.

(4)

(5)

(6)

(7)	Price per share represents the closing price of our common stock on the date of grant.

Senior Executives and Management [Member] | Time-Based Restricted Stock Units [Member]

Summary of Grants of Time-Based Restricted Stock Unit Awards

	Time-Based
	Restricted Stock
Date of Grant	Units Awarded		Price Per Share			Vesting Period
July 18, 2019		34,399	$	18.49	(1)	3 years
August 2, 2018		10,000	$	24.35	(1)	5 years

(1)	Price per share represents closing price of common stock on the date the respective award was granted.

Income Taxes - Valuation Allowance - Narrative (Detail) - USD ($)	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019
Income Taxes [Line Items]
Income tax charge	$ 4,324,000	$ 1,692,000
Valuation Allowance, Tax Credit Carryforward [Member]
Income Taxes [Line Items]
Income tax charge	271,000
GILTI [Member]
Income Taxes [Line Items]
Non-cash income tax benefit/charges	(3,500,000)
COVID-19 [Member] \| GILTI [Member]
Income Taxes [Line Items]
Non-cash income tax benefit/charges	$ 7,000,000.0

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Commitments and Contingencies Disclosure [Line Items]

Commitments and Contingencies - Narrative (Detail) - USD ($)

Aug. 02, 2020

May 03, 2020

^[1]

Aug. 04, 2019

Accounts payable for capital expenditures

$ 333,000

$ 107,000

$ 50,000

Mattress Fabrics [Member] | Capital Addition Purchase Commitments [Member]

Commitments and Contingencies Disclosure [Line Items]

Open purchase commitments for equipment

$ 2,000,000.0

[1]	Derived from audited financial statements.

Lines of Credit and Paycheck Protection Program Loan - Narrative (Detail)

1 Months Ended

3 Months Ended

12 Months Ended

Jun. 30, 2020

USD ($)

Aug. 02, 2020

USD ($)

May 02, 2021

USD ($)

Aug. 02, 2020

CNY (¥)

May 03, 2020

USD ($)

Apr. 15, 2020

USD ($)

Aug. 04, 2019

USD ($)

Paycheck Protection Program (PPP) loan amount

Outstanding amount

^[1]

$ 29,750,000

Repayments of debt

$ 30,772,000

^[1]

$ 7,606,000

Paycheck Protection Program, CARES Act [Member]

Paycheck Protection Program (PPP) loan amount

$ 7,600,000

Revolving Credit Facility [Member] | United States [Member]

Maximum borrowing capacity

$ 30,000,000

Expiration date

Aug. 15, 2022

Maximum amount of letters of credit

$ 1,000,000

Applicable interest rate at end of period

1.75%

3.68%

Interest rate description

Interest is charged at a rate as a variable spread over LIBOR based on our ratio of debt to EBITDA.

Reference rate on which the interest rate is based

LIBOR

Percentage of common stock in subsidiary pledge as collateral

65.00%

Outstanding amount

$ 0

$ 29,800,000

$ 0

Repayments of debt

$ 29,800,000

Letters of credit, outstanding amount

250,000

$ 250,000

250,000

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member]

Reduced percentage of allowable liens and other indebtedness

5.00%

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Maximum [Member]

Maximum allowable payment of dividends or stock repurchase

$ 10,000,000

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Scenario Forecast [Member]

Annual capital expenditures

$ 10,000,000

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Price Level I [Member]

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Price Level II [Member]

1.60%

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Price Level III [Member]

2.05%

Revolving Credit Facility [Member] | United States [Member] | Seventh Amendment to Credit Agreement [Member] | Price Level IV [Member]

2.50%

Revolving Credit Facility [Member] | United States [Member] | Letters of Credit [Member]

3.00%

Remaining letters of credit

750,000

Revolving credit agreement [Member] | China [Member]

Maximum borrowing capacity

$ 5,700,000

¥ 40,000,000

Expiration date

Dec. 04, 2020

Applicable interest rate at end of period

2.41%

Interest rate description

This agreement has an interest rate determined by the Chinese government at the time of borrowing and is set to expire on December 4, 2020. As of May 3, 2020, there were outstanding borrowings under the agreement totaling $1.0 million, at an applicable interest rate of 2.41%.

Outstanding amount

$ 0

$ 1,000,000.0

$ 0

Repayments of debt

$ 1,000,000.0

[1]	Derived from audited financial statements.

Common Stock Repurchase Program (Detail) - Common Stock [Member] - USD ($)	3 Months Ended
	Aug. 02, 2020	Aug. 04, 2019	Mar. 31, 2020
Stockholders Equity Note [Line Items]
Common stock repurchased	0	0
Remaining authorized repurchase amount	$ 5,000,000.0
Stock Repurchase Program March 2020 [Member]
Stockholders Equity Note [Line Items]
Authorization amount for repurchase of common stock			$ 5,000,000.0

Accrued Expenses (Tables)

3 Months Ended

Aug. 02, 2020

Summary of Accrued Expenses

A summary of accrued expenses follows:

(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Compensation, commissions and related benefits	$	4,549	$	3,493	$	3,038
Interest		—		13		9
Other accrued expenses		3,420		5,393		2,807
	$	7,969	$	8,899	$	5,854

Revenue from Contracts with Customers - Narrative (Detail)	3 Months Ended
	Aug. 02, 2020 USD ($) Segment	Aug. 04, 2019 USD ($)	May 03, 2020 USD ($)
Contract Assets and Liabilities [Line Items]
Number of operating segments \| Segment	2
Net sales	$ 64,464,000	$ 70,719,000
Contract assets recognized	$ 0	0	$ 0
Minimum [Member]
Contract Assets and Liabilities [Line Items]
Contract with customers credit period	15 days
Maximum [Member]
Contract Assets and Liabilities [Line Items]
Contract with customers credit period	60 days
Discontinued Operations [Member] \| Home Accessories [Member]
Contract Assets and Liabilities [Line Items]
Net sales		$ 4,300,000

Schedule of Equity Method Investments [Line Items]

Investment in Unconsolidated Joint Venture - Summary of Equity Method Investment (Detail) - USD ($)
$ in Thousands

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Apr. 28, 2019

^[1]

CLIH [Member] | Equity Method Investment Nonconsolidated Investee Or Group of Investees [Member]

$ 184,587

$ 215,084

^[1]

$ 226,247

Total liabilities

58,718

85,386

^[1]

61,911

Total members’ equity

125,869

129,698

^[1]

164,336

$ 164,247

Schedule of Equity Method Investments [Line Items]

3,668

3,338

3,161

Total liabilities

149

133

120

Total members’ equity

$ 3,519

$ 3,205

$ 3,041

[1]	Derived from audited financial statements.

Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events.

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Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future.

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Discontinued Operations And Disposal Groups [Abstract]

Home Accessories Segment – Discontinued Operation

3 Months Ended

Aug. 02, 2020

Home Accessories Segment – Discontinued Operation

3.	HOME ACCESSORIES SEGMENT – DISCONTINUED OPERATION

Overview

On March 31, 2020, we sold our entire ownership interest in eLuxury, LLC (“eLuxury”) to eLuxury’s noncontrolling interest holder in consideration of an accelerated settlement of certain financial obligations due and payable by eLuxury to us and the entry into supply and royalty arrangements designed to preserve an additional sales channel for our core products. Also, this sale, which was part of our comprehensive response to the challenging business conditions arising from the COVID-19 global pandemic, is expected to increase our liquidity and allows us to focus on our core businesses of upholstery and mattress fabrics.

In connection with the sale of our entire ownership interest in eLuxury, (i) we received $509,500 at closing as an accelerated repayment of principal amounts previously loaned to eLuxury, together with outstanding interest, under a loan agreement between us and eLuxury; (ii) we forgave $300,000 of borrowings payable by eLuxury to us under this loan agreement; (iii) we entered into an amended and restated credit and security agreement with eLuxury and the buyer (the former noncontrolling interest holder) (together, the “Borrowers”), pursuant to which the Borrowers agreed to repay an additional $1 million previously loaned to eLuxury within thirty days of the closing of the sale transaction (and which amount was secured by the assets of both Borrowers); and (iv) eLuxury agreed to pay $613,000 within sixty days of the sale transaction in satisfaction of certain trade accounts payable due from eLuxury to us.

The remaining $1 million we previously loaned to eLuxury and the outstanding trade accounts payable balance of $613,000 due from eLuxury to us has been paid in full in accordance with the terms of the sale agreement outlined above.

Discontinued Operation Financial Statement Presentation and Disclosures

Financial Statement Presentation

Due to the sale of our entire ownership interest in eLuxury, our home accessories segment was eliminated. This sale (and the resulting elimination of the home accessories segment) was the result of our strategic decision to focus on our core business products, which we believe will increase our liquidity and assist with our comprehensive response to the COVID-19 global pandemic. Consequently, we determined that the results from operations and assets and liabilities associated with our home accessories segment were to be excluded from our continuing operations and presented as a discontinued operation in our consolidated financial statements in accordance with ASC Topic 205-20-45. As a result, we classified the results from operations of our home accessories segment separately in captions titled “Discontinued Operations” on our Consolidated Statement of Net Income for the three-months ending August 4, 2019. Additionally, assets and liabilities associated with our home accessories segment as of August 4, 2019, were reclassified from certain amounts reported in the prior period to present separately in captions titled “current assets – discontinued operation”, “noncurrent assets – discontinued operation”, “current liabilities -discontinued operation”, and “noncurrent liabilities – discontinued operation” to conform to current year financial statement presentation.

Consolidated Balance Sheet

The following is a summary of the assets and liabilities of the disposal group that are presented separately as a discontinued operation on the Consolidated Balance Sheet as of August 4, 2019.

	August 4,
(dollars in thousands)	2019
ASSETS
current assets:
cash and cash equivalents	$	—
accounts receivable		429
inventories		3,067
other current assets		61
total current assets - discontinued operation		3,557
property, plant, and equipment		1,814
goodwill		13,653
intangible asset		6,549
right of use asset		1,042
total noncurrent assets - discontinued operation		23,058
total assets	$	26,615
LIABILITIES AND NET ASSETS
current liabilities:
accounts payable	$	783
operating lease liability - current		186
accrued expenses		462
total current liabilities - discontinued operation		1,431
loan payable - Culp Inc.		1,800
subordinated loan payable - noncontrolling interest		925
operating lease liability - long-term		874
total noncurrent liabilities - discontinued operation		3,599
total liabilities		5,030
total net assets of discontinued operation	$	21,585

Net Loss from Discontinued Operation

The following is a summary of the major classes of financial statement line items constituting loss before income taxes from discontinued operation that are presented in the Consolidated Statements of Net Income for the three-months ending August 4, 2019:

	August 4,
(dollars in thousands)	2019
net sales	$	4,302
cost of sales		(3,349	)
gross profit		953
selling, general and administrative expenses		(1,562	)
interest expense (1)		(20	)
other income		8
loss before income taxes from discontinued operation		(621	)
income tax benefit		11
net loss from discontinued operation	$	(610	)

(1)	Interest expense is directly attributable to our discontinued operations as it pertains to loans payable assumed by the buyer, (the former noncontrolling interest holder) or required to be paid to Culp Inc. based on the terms of the sale agreement.

The following is a summary of net (loss) income from continuing operations, net loss from discontinued operation, and net (loss) income attributable to Culp Inc. common shareholders and the noncontrolling interest associated with our discontinued operation for the three-months ending August 2, 2020, and August 4, 2019:

	August 2,			August 4,
(dollars in thousands)	2020			2019
net (loss) income from continuing operations	$	(2,733	)	$	1,784
net (loss) income from continuing operations attributable to noncontrolling interest		—			—
net (loss) income from continuing operations attributable to Culp Inc. common shareholders	$	(2,733	)	$	1,784
net loss from discontinued operation	$	-		$	(610	)
net loss from discontinued operation attributable to noncontrolling interest		—			164
net loss from discontinued operation attributable to Culp Inc. common shareholders	$	-		$	(446	)
net loss (income)	$	(2,733	)	$	1,174
net loss from noncontrolling interest associated with a discontinued operation		—			164
net (loss) income attributable to Culp Inc. common shareholders	$	(2,733	)	$	1,338

Cash Flow Disclosures

Our discontinued operation had net cash used in operating activities totaling $1.4 million during the three-months ending August 4, 2019. Our discontinued operation did not have any net cash (used in) or provided by investing activities during the three-months ending August 4, 2019. Our discontinued operation had net cash provided by financing activities, all of which were loan proceeds and capital contributions from Culp, Inc. and the noncontrolling interest holder of eLuxury, totaling $1.4 million during the three-months ending August 4, 2019. We believe our liquidity will improve in the absence of our former home accessories segment due to the significant losses that were incurred by that segment and the funding of its working capital requirements primarily by us through loans and capital contributions that will no longer be required.

Continuing Obligations, Financial Commitments, and Continuing Relationships with the Discontinued Operation

Supply and Royalty Agreements

In connection with the sale of our entire ownership interest in eLuxury, we entered into supply and royalty agreements with eLuxury to preserve an additional sales channel for our core products – upholstery and mattress fabrics. The supply agreement requires eLuxury to purchase all its requirements at fair market prices for mattress and upholstery fabrics products of the type we were supplying to eLuxury at the time of the sale transaction, as well as certain home accessories and soft goods products, subject to our ability to provide competitive pricing and delivery terms for such products. The royalty agreement requires eLuxury to pay us a royalty fee based on a percentage of sales, as defined in the royalty agreement, for sales of eLuxury’s products to certain business-to-business customers, including customers which we referred to eLuxury prior to the sale transaction and new customer relationships we develop for eLuxury going forward, as well of eLuxury products generated by sales representatives that we develop or introduce to eLuxury.

There are no guarantees or provisions under either the supply or royalty agreements that require eLuxury to purchase a minimum amount of our products or sell a certain amount of eLuxury products to customer or through sales representatives developed or introduced by us. As a result, the success of these agreements and the period of time in which our involvement with eLuxury is expected to continue are based on eLuxury’s ability to sell products that require mattress and upholstery fabrics and our ability to provide an additional sales channel for eLuxury to grow their business-business sales platform.

As a result of our continuing involvement with eLuxury, we reported net sales and the related cost of sales associated with our inventory shipments to eLuxury in accordance with Topic 205-20-50-4B, which requires us to report these transactions in continuing operations for our Consolidated Statement of Income for the three-months ending August 4, 2019. Therefore, we reported both net sales and cost of sales from continuing operations totaling $174,000 during the three-months ending August 4, 2019, that were previously eliminated in consolidation.

During the three-months ending August 2, 2020, shipments to eLuxury under the supply arrangement totaled $244,000. During the three-months ending August 2, 2020, we received payments pursuant to the royalty agreement totaling $17,000.

Financial Guarantee

Currently, we have an agreement that guarantees 70% of any unpaid lease payments associated with eLuxury’s facility located in Evansville, Indiana. The lease agreement expires in September 2024 and requires monthly payments of $18,865. Under the terms of the sale of our controlling interest in eLuxury, the buyer (the former noncontrolling interest holder) must use commercially reasonable efforts to cause the lessor to release us from this financial guarantee of eLuxury’s lease agreement. Additionally, eLuxury, and its sole owner following the sale transaction, have indemnified us from any liabilities and obligations that we would be required to pay regarding this lease agreement.

Fair Value of Financial Instruments (Tables)

3 Months Ended

Aug. 02, 2020

Fair Value Disclosures [Abstract]

Schedule of Assets Measured at Fair Value on a Recurring Basis

The following table presents information about assets measured at fair value on a recurring basis:

Fair value measurements as of August 2, 2020 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

7,533

N/A

7,533

Short Term Bond Funds

983

N/A

983

Growth Allocation Fund

246

N/A

246

Moderate Allocation Fund

N/A

Other

N/A

Fair value measurements as of August 4, 2019 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

6,920

N/A

6,920

Growth Allocation Fund

213

N/A

213

Moderate Allocation Fund

130

N/A

130

Other

N/A

Fair value measurements as of May 3, 2020 using:

Quoted prices

Significant

in active

other

Significant

markets for

observable

unobservable

identical assets

inputs

(amounts in thousands)

Level 1

Level 2

Level 3

Total

Assets:

Premier Money Market Fund

7,496

N/A

7,496

Short Term Bond Funds

923

N/A

923

Growth Allocation Fund

219

N/A

219

Moderate Allocation Fund

N/A

Other

N/A

Cash Flow Information - Interest and Income Taxes Paid (Parenthetical) (Detail) - USD ($)

3 Months Ended

Nov. 01, 2020

Aug. 02, 2020

Aug. 04, 2019

Supplemental Cash Flow Elements [Line Items]

AMT credit carryforward balance

$ 1,500,000

Percentage of expected alternative minimum tax amount refundable in fiscal year 2021

50.00%

Percentage of expected alternative minimum tax amount refundable in fiscal year 2022

50.00%

AMT credit carryforward refundable balance amount received

$ 746,000

Percentage of AMT credits refundable under CARES Act

100.00%

Income tax payment,net

^[1],[2]

$ 9,000

$ 1,822,000

Income tax payment with foreign jurisdictions

755,000

984,000

Income tax refund

$ 746,000

Withhold tax payment

$ 838,000

Scenario Forecast [Member]

Supplemental Cash Flow Elements [Line Items]

AMT credit carryforward remaining refundable balance amount received

$ 764,000

[1]

[2]

Accrued Expenses - Narrative (Detail) - USD ($)

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

Payables and Accruals [Line Items]

Accrued expenses

$ 7,969,000

$ 5,854,000

$ 8,899,000

Current accrued expenses

7,852,000

5,687,000

^[1]

8,104,000

Long-term accrued expenses

$ 117,000

$ 167,000

^[1]

333,000

Current Liabilities - Discontinued Operation [Member]

Payables and Accruals [Line Items]

Accrued expenses

$ 462,000

[1]	Derived from audited financial statements.

Home Accessories Segment – Discontinued Operation (Tables)

3 Months Ended

Aug. 02, 2020

Discontinued Operations And Disposal Groups [Abstract]

Summary of Disposal of Discontinued Operation on Consolidated Balance Sheet

The following is a summary of the assets and liabilities of the disposal group that are presented separately as a discontinued operation on the Consolidated Balance Sheet as of August 4, 2019.

	August 4,
(dollars in thousands)	2019
ASSETS
current assets:
cash and cash equivalents	$	—
accounts receivable		429
inventories		3,067
other current assets		61
total current assets - discontinued operation		3,557
property, plant, and equipment		1,814
goodwill		13,653
intangible asset		6,549
right of use asset		1,042
total noncurrent assets - discontinued operation		23,058
total assets	$	26,615
LIABILITIES AND NET ASSETS
current liabilities:
accounts payable	$	783
operating lease liability - current		186
accrued expenses		462
total current liabilities - discontinued operation		1,431
loan payable - Culp Inc.		1,800
subordinated loan payable - noncontrolling interest		925
operating lease liability - long-term		874
total noncurrent liabilities - discontinued operation		3,599
total liabilities		5,030
total net assets of discontinued operation	$	21,585

Summary of Loss Before Income Tax from Discontinued Operation on Consolidated Statements of Net Income

	August 4,
(dollars in thousands)	2019
net sales	$	4,302
cost of sales		(3,349	)
gross profit		953
selling, general and administrative expenses		(1,562	)
interest expense (1)		(20	)
other income		8
loss before income taxes from discontinued operation		(621	)
income tax benefit		11
net loss from discontinued operation	$	(610	)

(1)	Interest expense is directly attributable to our discontinued operations as it pertains to loans payable assumed by the buyer, (the former noncontrolling interest holder) or required to be paid to Culp Inc. based on the terms of the sale agreement.

Summary of Net (Loss) Income from Continuing Operations, Net Loss from Discontinued Operation, and Net (Loss) Income Attributable to Common Shareholders and Noncontrolling Interest

	August 2,			August 4,
(dollars in thousands)	2020			2019
net (loss) income from continuing operations	$	(2,733	)	$	1,784
net (loss) income from continuing operations attributable to noncontrolling interest		—			—
net (loss) income from continuing operations attributable to Culp Inc. common shareholders	$	(2,733	)	$	1,784
net loss from discontinued operation	$	-		$	(610	)
net loss from discontinued operation attributable to noncontrolling interest		—			164
net loss from discontinued operation attributable to Culp Inc. common shareholders	$	-		$	(446	)
net loss (income)	$	(2,733	)	$	1,174
net loss from noncontrolling interest associated with a discontinued operation		—			164
net (loss) income attributable to Culp Inc. common shareholders	$	(2,733	)	$	1,338

Revenue from Contracts with Customers

3 Months Ended

Aug. 02, 2020

Revenue From Contract With Customer [Abstract]

Revenue from Contracts with Customers

5. Revenue from Contracts with Customers

Nature of Performance Obligations

Continuing Operations

Our continuing operations are classified into two business segments: mattress fabrics and upholstery fabrics. The mattress fabrics segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery fabrics segment develops, manufactures, sources, and sells fabrics primarily to residential and commercial furniture manufacturers. Additionally, Read Window Products LLC (“Read”), a wholly-owned subsidiary, is a turn-key provider of window treatments and sourcing of upholstery fabrics and other products, as well as measuring, and installation services of Read’s products for the hospitality and commercial industries. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows. Read is included in the upholstery fabrics segment.

Our primary performance obligations include the sale of mattress fabrics and upholstery fabrics, as well as the performance of customized fabrication and installation services of Read’s own products associated with window treatments.

Discontinued Operation – Home Accessories Segment

As disclosed in Note 3 of the consolidated financial statements, we sold our entire ownership interest in eLuxury on March 31, 2020, and consequently our home accessories segment was eliminated at such time. Thus, the results of operations associated with our home accessories segment were excluded from our continuing operations and are presented as a discontinued operation in our consolidated financial statements.

The home accessories segment was our finished products business that manufactured, sourced, and sold bedding accessories and home goods directly to consumers and businesses through global e-commerce, business-to-business, and other sales channels.

Prior to its disposal, our former home accessories segment reported net sales totaling $4.3 million during the first quarter of fiscal 2020. Revenue associated with the sales of home accessories products was recognized at the point-in-time when control was transferred to the customer.

Contract Assets & Liabilities

Certain contracts, primarily those for customized fabrication and installation services associated with Read, require upfront customer deposits that result in a contract liability which is recorded on the Consolidated Balance Sheets as deferred revenue. If upfront deposits or prepayments are not required, customers may be granted credit terms which generally range from 15 – 60 days. For a limited time, extended terms were granted to certain customers in response to the challenging business conditions resulting from the COVID-19 global pandemic. Our customary terms, as well as the limited extended terms, are common within the industries in which we operate and are not considered financing arrangements. There were no contract assets recognized as of August 2, 2020, August 4, 2019, and May 3, 2020.

A summary of the activity associated with deferred revenue for the three-month periods ended August 2, 2020, and August 4, 2019, follows:

	Three months ended
(dollars in thousands)	August 2, 2020			August 4, 2019
Beginning balance	$	502		$	399
Revenue recognized on contract liabilities		(593	)		(483	)
Payments received for services not yet rendered		776			768
Ending balance	$	685		$	684

Disaggregation of Revenue

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending August 2, 2020:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	36,103	$	26,061	$	62,164
Services transferred over time		—		2,300		2,300
Total Net Sales	$	36,103	$	28,361	$	64,464

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ending August 4, 2019:

	Mattress		Upholstery
(dollars in thousands)	Fabrics		Fabrics		Total
Products transferred at a point in time	$	38,859	$	29,827	$	68,686
Services transferred over time		—		2,033		2,033
Total Net Sales	$	38,859	$	31,860	$	70,719

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Assets And Liabilities Lessee [Abstract]

Leases (Tables)

3 Months Ended

Aug. 02, 2020

Summary of right of use asset and lease liabilities

The right of use asset and lease liabilities associated with our operating leases as of August 2, 2020, August 4, 2019, and May 3, 2020, are as follows:

			(1)
(dollars in thousands)	August 2, 2020		August 4, 2019		May 3, 2020
Right of use asset	$	6,443	$	6,530	$	3,903
Operating lease liability - current		2,387		2,456		1,805
Operating lease liability – noncurrent		4,214		3,955		2,016

(1)

Supplemental Cash Flow Information

	Three Months Ended
(dollars in thousands)	August 2, 2020
Operating lease liability payments	$	445
Right of use assets exchanged for lease liabilities		3,154

	Three Months Ended
(dollars in thousands)	August 4, 2019
Operating lease liability payments	$	657
Right of use assets exchanged for lease liabilities		—

Leases-Other Information

Other Information

Maturity of our operating lease liabilities for the remainder of fiscal 2021, the subsequent next four fiscal years, and thereafter follows:

(dollars in thousands)
2021	$	2,050
2022		1,765
2023		1,350
2024		1,079
2025		663
Thereafter		—
	$	6,907
Less: interest		(306	)
Present value of lease liabilities	$	6,601

Summary of weighted average remaining lease term and discount rate

As of August 2, 2020, the weighted average remaining lease term and discount rate for our operating leases follows:

	August 2, 2020
Weighted average lease term	3.5 years
Weighted average discount rate		2.78	%

As of August 4, 2019, the weighted average remaining lease term and discount rate for our operating leases follows:

	August 4, 2019
Weighted average lease term	3.5 years
Weighted average discount rate		3.82	%

Leases - Lessee Operating Lease Right of Use Assets and Liabilities (Parenthetical) (Detail) - USD ($)

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

$ 6,443,000

$ 3,903,000

$ 6,530,000

^[1]

Noncurrent assets - Discontinued operation

6,443,000

3,903,000

^[2]

5,488,000

23,058,000

Operating lease liabilities

6,601,000

6,400,000

Current liabilities - Discontinued operation

2,387,000

1,805,000

^[2]

2,270,000

1,431,000

Operating lease liability - noncurrent

$ 4,214,000

$ 2,016,000

^[2]

3,081,000

Noncurrent liabilities - Discontinued operation

3,599,000

Right of Use Assets [Member]

Noncurrent Assets Discontinued Operation [Member]

5,500,000

Noncurrent assets - Discontinued operation

1,000,000.0

Operating Lease Liability Current [Member]

Current Liabilities - Discontinued Operation [Member]

2,300,000

Current liabilities - Discontinued operation

186,000

Operating Lease Liability Noncurrent [Member]

Operating lease liability - noncurrent

3,100,000

Noncurrent Liabilities Discontinued Operation [Member]

Noncurrent liabilities - Discontinued operation

$ 874,000

[1]

[2]

Derived from audited financial statements.

Segment Information - Balance Sheet Information by Operating Segments (Parenthetical) (Detail) - USD ($)
$ in Thousands

Aug. 02, 2020

May 03, 2020

Aug. 04, 2019

$ 42,051

$ 43,147

^[1]

$ 45,475

Operating Segments [Member] | Mattress Fabrics [Member]

6,443

3,903

^[1]

5,488

^[2]

39,597

40,682

43,211

Operating Segments [Member] | Upholstery Fabrics [Member]

^[3]

832

362

235

^[4]

1,634

1,633

1,856

Operating Segments [Member] | United States [Member] | Mattress Fabrics [Member]

^[5]

3,802

1,633

3,054

27,000

27,700

31,200

Operating Segments [Member] | United States [Member] | Upholstery Fabrics [Member]

297

362

235

1,200

1,300

Operating Segments [Member] | Canada [Member] | Mattress Fabrics [Member]

710

857

1,300

12,600

13,000

12,000

Operating Segments [Member] | China [Member] | Upholstery Fabrics [Member]

535

456

471

548

Unallocated Corporate [Member]

3,100

776

1,800

^[6]

820

832

408

Unallocated Corporate [Member] | United States [Member]

^[7]

1,809

1,908

2,199

820

832

408

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

$ 1,800

$ 1,900

$ 2,200

[1]	Derived from audited financial statements.
[2]	The $39.6 million as of August 2, 2020, represents property, plant, and equipment of $27.0 million and $12.6 million located in the U.S. and Canada, respectively. The $43.2 million as of August 4, 2019, represents property, plant, and equipment of $31.2 million and $12.0 million located in the U.S. and Canada, respectively. The $40.7 million as of May 3, 2020, represents property, plant, and equipment of $27.7 million and $13.0 million located in the U.S. and Canada, respectively.
[3]	The $832 as of August 2, 2020 represents right of use assets of $297 and $535 located in the U.S. and Canada, respectively. The $235 as of August 4, 2019, and the $362 as of May 3, 2020, represents right of use assets located in the U.S.
[4]	The $1.6 million as of August 2, 2020, represents property, plant, and equipment of $1.2 million and $456 located in the U.S. and China, respectively. The $1.9 million as of August 4, 2019, represents property, plant, and equipment of $1.3 million and $548 located in the U.S. and China, respectively. The $1.6 million as of May 3, 2020, represents property, plant, and equipment of $1.2 million and $471 located in the U.S. and China, respectively.
[5]	The $3.8 million as of August 2, 2020, represents right of use assets of $3.1 million and $710 located in China and the U.S., respectively. The $3.1 million as of August 4, 2019, represents right of use assets of $1.8 million and $1.3 million located in China and the U.S., respectively. The $1.6 million as of May 3, 2020, represents right of use assets of $857 and $776 located in the U.S. and China, respectively.
[6]	The $820, $408, and $832 as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represent property, plant, and equipment associated with unallocated corporate departments and corporate departments shared by our mattress fabrics and upholstery fabrics segments. Property, plant, and equipment associated with our corporate departments reside in the U.S.
[7]	The $1.8 million, $2.2 million, and $1.9 million as of August 2, 2020, August 4, 2019, and May 3, 2020, respectively, represents right of use assets located in the U.S

Stock-Based Compensation - Summary of Grants of Time-Based Restricted Stock Unit Awards Associated with Key Member of Management (Detail) - Time-Based Restricted Stock Units [Member] - Senior Executives and Management [Member] - $ / shares

Jul. 18, 2019

Aug. 02, 2018

Time-Based Restricted Stock Units Awarded

34,399

10,000