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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) January 27, 2005
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Culp, Inc.
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(Exact Name of Registrant as Specified in its Charter)
North Carolina 0-12781 56-1001967
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
101 South Main Street
High Point, North Carolina 27260
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(Address of Principal Executive Offices)
(Zip Code)
(336) 889-5161
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former name or address, if changed from last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 7.01. Regulation FD Disclosure.
Culp, Inc. (the "Company") issued a press release dated January 27, 2005, to
announce the Company's response to the announcement by Solutia Inc., which
supplies acrylic fiber to the Company, that Solutia plans to exit the acrylic
fiber business. A copy of the press release is filed with this Form 8-K as
Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(c) The following exhibits are filed as part of this report:
99.1 - Press Release dated January 27, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: January 27, 2005
Culp, Inc.
By: /s/ Franklin N. Saxon
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President and Chief Operating Officer
EXHIBIT INDEX
Exhibit Number Exhibit
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99.1 Press Release dated January 27, 2005
Exhibit 99.1
Culp, Inc. Responds to Solutia Inc. Announcement
HIGH POINT, N.C.--(BUSINESS WIRE)--Jan. 27, 2005--Culp, Inc. (NYSE:CFI)
today issued the following statement in response to an announcement on January
25, 2005, by Solutia Inc., the company's supplier for acrylic fiber used to spin
yarn. On December 17, 2003, Solutia filed for reorganization under Chapter 11 of
the federal bankruptcy laws. While the previous actions taken by this supplier
have generally not had an adverse effect on supplies to Culp, Solutia has now
notified its customers, including Culp, of plans to exit the acrylic fiber
business in early to mid-April, pending approval by the U.S. Bankruptcy Court.
The company estimates that fabrics utilizing this type of fiber represent
approximately one-third of Culp's overall sales. All of Culp's fabrics that are
manufactured using acrylic fiber are within the company's upholstery fabrics
segment, representing approximately one-half of total sales for this segment.
Commenting on the news, Robert G. Culp, III, chairman and chief executive
officer, stated, "While we regret that Solutia has made this business decision,
we have already identified and contacted several international suppliers as
alternative sources for procuring this particular fiber. With our recent
offshore sourcing activities, we have established an international presence that
will enhance our ability to find a suitable supplier. However, until we make
alternative arrangements, we anticipate an immediate increase in raw material
costs for this fiber and related unit production costs. Unfortunately, in order
to mitigate the impact of this situation, in the short term we do expect to
implement a price increase in our upholstery fabrics segment.
"Our goal is to minimize the disruption to our customers," added Culp. "We
will work closely with our customers to continue to supply the fabrics they need
that utilize this acrylic fiber. Additionally, we will focus on offering a
selection of alternative fabrics, such as fabrics woven from other types of
yarn, including internally produced yarn, and the popular microdenier suedes
that are not affected by this event. It is also important to note that this will
only affect our upholstery fabrics segment and customers. Acrylic fiber is not
utilized by the company's mattress fabrics segment, which now accounts for
approximately 40 percent of Culp's overall business."
Culp, Inc. is one of the world's largest marketers of mattress fabrics for
bedding and upholstery fabrics for furniture. The company's fabrics are used
principally in the production of bedding products and residential and commercial
upholstered furniture.
This release contains statements that may be deemed "forward-looking
statements" within the meaning of the federal securities laws, including the
Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities
Act of 1933 and Section 27A of the Securities and Exchange Act of 1934). Such
statements are inherently subject to risks and uncertainties. Further,
forward-looking statements are intended to speak only as of the date on which
they are made. Forward-looking statements are statements that include
projections, expectations or beliefs about future events or results or otherwise
are not statements of historical fact. Such statements are often but not always
characterized by qualifying words such as "expect," "believe," "estimate,"
"plan" and "project" and their derivatives, and include but are not limited to
statements about the company's future operations, production levels, sales, SG&A
or other expenses, margins, gross profit, operating income, earnings or other
performance measures. Factors that could influence the matters discussed in such
statements include the level of housing starts and sales of existing homes,
consumer confidence, trends in disposable income, and general economic
conditions. Decreases in these economic indicators could have a negative effect
on the company's business and prospects. Likewise, increases in interest rates,
particularly home mortgage rates, and increases in consumer debt or the general
rate of inflation, could affect the company adversely. In addition,
strengthening of the U.S. dollar against other currencies could make the
company's products less competitive on the basis of price in markets outside the
United States. Also, economic and political instability in international areas
could affect the company's operations or sources of goods in those areas, as
well as demand for the company's products in international markets. Finally,
unanticipated delays or costs in executing restructuring actions could cause the
cumulative effect of restructuring actions to fail to meet the objectives set
forth by management. Other factors that could affect the matters discussed in
forward-looking statements are included in the company's periodic reports filed
with the Securities and Exchange Commission.
CONTACT: Culp, Inc., High Point
Investor Contact:
Kathy J. Hardy, 336-888-6209
or
Media Contact:
Kenneth M. Ludwig, 336-889-5161