Culp, Inc. (NYSE:CULP) Q2 2020 Earnings Conference Call - Final Transcript

Dec 06, 2019 • 11:00 am ET

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Culp, Inc. (NYSE:CULP) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Executive
Iv Culp

both in covers and mattress fabrics. Already with Culp China and what we're doing in Vietnam, that we really are seeing an opportunity to capture fabric and even cover business on those important sales going forward. So it's a much different perspective for us -- perspective as we look out, we certainly would matter of the business be domestic, but if it's not we have ways of capturing our products on those imports, which we didn't have before.

Analyst
Alfonso Jimenez

All right. Thank you and good luck on the balance of the year.

Executive
Franklin N. Saxon

Thank you.

Operator
Operator

[Operator Instructions] We will now take our next question from John Baugh of Stifel. Please go ahead.

Analyst
John Baugh

Thank you and good morning. Iv, I wanted to just continue on the betting topic on a couple of things here, one is you mentioned a lot is being relocated to other countries, is it your view, or is it just too early to call that virtually all the units from China. We're coming in will be replaced elsewhere around the world and that the US producers were really pickup up nothing or fractional or any early read on that?

Executive
Iv Culp

Yes, that's a good question, John, and I'm certainly not the expert to know that and it is probably a little bit early to call, but I would say, we have been surprised that how much of the business, there was currently -- was previously imported from China has relocated to other countries. So I think the jury is still out as to whether those other countries can support it both service wise and cost-wise and quality-wise as China did. So I do think there is business to be gained for domestic producers but some Culp internal perspective, we really do see a lot of opportunities to pick up business in these other important countries. So I'm not nearly is worried about it as I was previously, but it is something we have to mark really close to see how much invest picking back in the US.

Analyst
John Baugh

Okay, and then you mentioned the kind of young engineering between legacy and boxed beds. I guess the question is on a margin basis for coal or is that a favorable trade as you look at neutral unfavorable?

Executive
Iv Culp

John, I think, one, the way I would talk about that is and there is yin and yang in legacy and roll-packed. And really just as we look at the full industry, you know, then the industry overall sales reports are were slightly negative for the last three months and I think there's just been some companies are doing very well, and some that are not. And so as a full service full industry supplier, we're kind of feeling that seen some high winds in seeing some lows customer to customer. I do think for generally speaking very favorable for us, the more it moves to roll-packed, sewn cover type of business because we are having a more value in the ultimate finished product. So