(CULP) 2023 Q4 法說會逐字稿

Good day, and welcome to the Culp, Inc. Fourth Quarter Fiscal 2023 Earnings Conference Call. (Operator Instructions) Pease note this event is being recorded. I would now like to turn the conference over to Dru Anderson. Please go ahead.

美好的一天，歡迎參加 Culp, Inc. 2023 財年第四季度收益電話會議。 （操作員說明）請注意此事件正在被記錄。我現在想把會議交給德魯·安德森。請繼續。

Thank you. Good morning, and welcome to the Culp conference call to review the company's results for the fourth quarter and fiscal 2023 year. As we start, let me state that this morning's call will contain forward-looking statements about the business, financial condition, and prospects of the company. Forward-looking statements are statements that include projections, expectations or beliefs about future events or results or otherwise are not statements of historical fact. The actual performance of the company could differ materially from that indicated by the forward-looking statements because of various risks and uncertainties. These risks and uncertainties are described in our regular SEC filings, including the company's most recent filings on Form 10-K and Form 10-Q. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations and financial results.

謝謝。早上好，歡迎參加卡爾普電話會議，回顧公司第四季度和 2023 財年的業績。首先，我要聲明，今天上午的電話會議將包含有關公司業務、財務狀況和前景的前瞻性陳述。前瞻性陳述是指包括對未來事件或結果的預測、期望或信念的陳述，或者不是歷史事實的陳述。由於各種風險和不確定性，公司的實際業績可能與前瞻性陳述所示的業績存在重大差異。這些風險和不確定性在我們定期向 SEC 提交的文件中進行了描述，包括公司最近提交的表格 10-K 和表格 10-Q。我們目前不了解或我們目前認為不重要的其他風險和不確定性也可能影響我們的業務運營和財務業績。

You are cautioned not to place undue reliance on forward-looking statements made today, and each such statement speaks only as of today. We undertake no obligation to update or to revise forward-looking statements. In addition, during this call, the company will be discussing non-GAAP financial measurements. A reconciliation of these non-GAAP financial measurements to the most directly comparable GAAP financial measurements is included in the tables to the press release included as an exhibit to the company's 8-K filed yesterday and posted on the company's website at culp.com. A slide presentation with supporting summary financial information is also available on the company's website as part of the webcast of today's call. I will now turn the call over to Mr. Iv Culp, President, and Chief Executive Officer of Culp. Please go ahead, sir.

請注意不要過分依賴今天發表的前瞻性聲明，每項此類聲明僅代表今天的情況。我們不承擔更新或修改前瞻性陳述的義務。此外，在這次電話會議中，該公司將討論非公認會計準則財務衡量標準。這些非 GAAP 財務衡量指標與最直接可比的 GAAP 財務衡量指標的調節表包含在新聞稿的表格中，該新聞稿作為該公司昨天提交的 8-K 報表的附件，並發佈在該公司網站 culp.com 上。作為今天電話會議網絡廣播的一部分，公司網站上還提供了包含支持摘要財務信息的幻燈片演示。我現在將電話轉給卡爾普總裁兼首席執行官艾夫·卡爾普先生。請繼續，先生。

Thank you, Dru, and good morning, and thank you for joining us today. I would like to welcome everyone to the Culp quarterly conference call with analysts and investors. With me on the call are Ken Bowling, our Chief Financial Officer; Boyd Chumbley, President of our upholstery fabrics business; and Tammy Bruno, President of our Mattress Fabrics business. I will begin the call with some opening comments, including a discussion of key points and topics for the quarter and priorities as we look ahead. After that, Ken will review the financial results for the quarter and the full year. I will then review our business outlook for the first quarter of fiscal 2024, and we will then take your questions. When we think about the current state of our business, we are furthering the themes we discussed last quarter and expanding them with a few important points that illustrate where Culp Inc. is today.

謝謝你，德魯，早上好，感謝你今天加入我們。我歡迎大家參加卡爾普與分析師和投資者舉行的季度電話會議。和我一起參加電話會議的是我們的首席財務官肯·鮑林 (Ken Bowling)； Boyd Chumbley，我們的室內裝飾面料業務總裁； Tammy Bruno，我們的床墊面料業務總裁。我將以一些開場白開始電話會議，包括討論本季度的要點和主題以及我們展望未來的優先事項。之後，肯將審查本季度和全年的財務業績。然後我將回顧我們 2024 財年第一季度的業務前景，然後我們將回答您的問題。當我們思考我們業務的當前狀況時，我們正在進一步深化我們上季度討論的主題，並通過幾個重要的要點來擴展它們，這些要點說明了 Culp Inc. 今天的狀況。

First, we are encouraged by our sequential and year-over-year improvement for the quarter despite ongoing demand softness within the two industries we service. Second, we reemphasize our unwavering focus on maintaining a strong balance sheet and managing our cash position. And third, we are excited by the ongoing comprehensive transformation within our CHF mattress fabrics business. Regarding our quarterly results, our sales and operating performance reflected solid improvement both sequentially and year-over-year in both in dollars and units, even as demand remained soft in the mattress and residential home furnishings industries. The strong sequential improvement in our mattress thermic segment was driven by the rollout of new customer programs during the period. As we have been commenting for some time now, these new programs are priced in line with current costs and are expected to grow this segment's market position in fiscal 2024.

首先，儘管我們服務的兩個行業的需求持續疲軟，但本季度的環比和同比改善令我們感到鼓舞。其次，我們再次強調我們堅定不移地致力於維持強勁的資產負債表和管理我們的現金頭寸。第三，我們對 CHF 床墊面料業務正在進行的全面轉型感到興奮。就我們的季度業績而言，儘管床墊和住宅家具行業的需求仍然疲軟，但我們的銷售和經營業績在美元和單位方面都反映出連續和同比的穩健改善。在此期間推出的新客戶計劃推動了我們的床墊加熱領域的強勁連續改善。正如我們已經評論了一段時間的那樣，這些新計劃的定價符合當前成本，預計將在 2024 財年提高該細分市場的市場地位。

The Culp Home Fashion's business is also seeing some benefit from improvement in operational efficiencies and cost reduction initiatives across our locations, and I will expand on this more shortly. For the upholstery fabrics segment, demand remained solid in our hospitality contract business. Our residential fabrics business also improved in Q4 due to a seasonal pickup following third-quarter shutdowns for the Chinese New Year holiday as well as a $1 million nonrecurring payment related to newly negotiated terms with the cut-and-sew customer. These new terms are in connection with reduced market demand for cut-and-sew upholstery kits and the related rationalization of our international upholstery cut-and-sew platforms to align with current demand levels. Importantly, we believe this is a positive outcome for both Culp and for our customers, and our ongoing business relationship remains solid.

Culp Home Fashion 的業務也從我們各地運營效率的提高和成本削減舉措中獲益，我將很快詳細介紹這一點。對於室內裝飾面料領域，我們的酒店合同業務需求依然強勁。我們的住宅面料業務在第四季度也有所改善，原因是第三季度中國農曆新年假期停工後出現季節性回升，以及與裁剪和縫製客戶新協商的條款相關的 100 萬美元非經常性付款。這些新術語與市場對裁剪和縫紉內飾套件的需求減少以及我們的國際內飾裁剪和縫紉平台的相關合理化有關，以適應當前的需求水平。重要的是，我們相信這對卡爾普和我們的客戶來說都是一個積極的結果，並且我們持續的業務關係仍然穩固。

Fiscal 2023 was a tough year with much volatility in the macro environment, the pressure demand in both of our business segments. The shift in consumer spending trends following the pandemic stay-at-home surge, inflationary pressures affecting consumer spending, and high inventory levels at residential furniture manufacturers and retailers are all factors that are out of our control. But we are pleased to have ended the year with sequential and year-over-year improvement in our quarterly sales and operating results. This reflects some of the initiatives we've undertaken internally to manage our business and control what we can control. And we believe we've recovered from the bottom and repositioned our business towards stabilization and early recovery next fiscal year, especially in our mattress fabrics segment. We do understand the pace of our improvement could be affected by recovery in the overall macro environment. In a state, but even in an ongoing tough demand backdrop, we expect continued and sustainable progress in improving our operating results.

2023財年是艱難的一年，宏觀環境波動較大，我們兩個業務板塊的需求都面臨壓力。疫情期間居家辦公激增後消費者支出趨勢的轉變、影響消費者支出的通脹壓力以及住宅家具製造商和零售商的高庫存水平都是我們無法控制的因素。但我們很高興在這一年結束時，我們的季度銷售和經營業績環比和同比有所改善。這反映了我們內部為管理業務和控制我們可以控制的事情而採取的一些舉措。我們相信，我們已經從底部復甦，並重新定位了我們的業務，以實現下一財年的穩定和早期復蘇，特別是在我們的床墊面料領域。我們確實了解我們的改善速度可能會受到整體宏觀環境復甦的影響。在某種情況下，即使是在持續嚴峻的需求背景下，我們預計在改善我們的經營業績方面將持續取得可持續的進展。

Our market position is solid, and we believe macro conditions will stabilize and excess inventory will fully flush through the supply chain at some point. As that occurs, we are extremely well positioned, and we expect stronger results. Now I'll shift to the second point, which is our unwavering commitment to maintaining a strong balance sheet and to manage our cash position. This is one of the main things we have some control over, regardless of business conditions, and I'm very pleased with the management team for its diligence in maintaining our solid financial position this year. We ended the year with a higher cash position than the prior year with $21 million in cash and no outstanding borrowings. We did an excellent job with inventory reductions throughout the year with a favorable cash impact of $21.1 million since the end of the third quarter of last fiscal year. We also managed accounts receivable effectively by improving our terms with key customers and navigating three major bankruptcies without any impact.

我們的市場地位穩固，我們相信宏觀環境將會穩定，過剩的庫存將在某個時候完全沖刷供應鏈。當這種情況發生時，我們處於非常有利的位置，並且我們期望取得更好的結果。現在我要談談第二點，即我們堅定不移地致力於維持強勁的資產負債表和管理我們的現金頭寸。無論業務狀況如何，這是我們可以控制的主要事情之一，我對管理團隊今年努力保持穩健的財務狀況感到非常滿意。年底時，我們的現金狀況高於上年，現金為 2100 萬美元，沒有未償還借款。自上一財年第三季度末以來，我們在全年庫存削減方面做得非常出色，帶來了 2110 萬美元的有利現金影響。我們還通過改善與主要客戶的條款以及在沒有任何影響的情況下順利度過三起重大破產事件來有效管理應收賬款。

Additionally, we generated positive cash flow from operations and free cash flow for the fiscal year of $7.8 million and $6.9 million, respectively, a significant improvement compared to last year's negative cash flow from operations of negative $17.4 million and negative free cash flow of $24.3 million. This is a $31 million turnaround in free cash flow. Outstanding cash management during challenging times, and I can't thank our associates enough. Importantly, we continue to have no outstanding debt, and our recent asset-based revolving credit facility enhances our liquidity position should we ever need it. We fully recognize that the management of Culp's strong balance sheet is a critical initiative and allows us to focus on investing in and optimizing our global manufacturing platform and to support our focus on growing profitable sales. The third important point both for the quarter and as we look ahead is the ongoing business transformation underway in Culp Home Fashions, which is our mattress Fairfax segment. As we've commented before, this certainly falls within the scope of areas we can control, and we believe CHF improvement is our best opportunity for growth from current levels.

此外，我們本財年的運營現金流和自由現金流分別為 780 萬美元和 690 萬美元，與去年運營現金流為負 1,740 萬美元和自由現金流為負 2,430 萬美元相比，有了顯著改善。這相當於 3100 萬美元的自由現金流周轉。在充滿挑戰的時期實現出色的現金管理，我對我們的員工感激不盡。重要的是，我們仍然沒有未償債務，而且我們最近的基於資產的循環信貸安排增強了我們的流動性狀況，以備我們需要時使用。我們充分認識到，管理卡爾普強勁的資產負債表是一項關鍵舉措，使我們能夠專注於投資和優化我們的全球製造平台，並支持我們專注於增長盈利銷售。本季度和我們展望未來的第三個重要點是 Culp Home Fashions 正在進行的業務轉型，這是我們的 Fairfax 床墊部門。正如我們之前評論的那樣，這當然屬於我們可以控制的範圍，我們相信瑞郎的升值是我們在當前水平基礎上實現增長的最佳機會。

Our Culp Home Fashions business is executing a comprehensive business transformation plan, laying the foundation for steady sequential improvement under the leadership of division President, Tammy Bruno, along with the restructured management team. This transformation plan focuses on long-term improvement in every facet of the business, including quality, sales, marketing and operational processes, supply chain optimization, employee engagement, and organizational management structure. Tammy and the CHF management team are relentlessly focused on operational excellence, leading the team and improving production efficiency and quality management as well as balancing our product mix to proper volumes and steady run schedules. We have made excellent progress with getting the right personnel in the right places and laying the building blocks for sustainable improvement in fiscal 2024.

我們的 Culp Home Fashions 業務正在執行全面的業務轉型計劃，為在部門總裁 Tammy Bruno 和重組後的管理團隊的領導下穩步持續改進奠定基礎。該轉型計劃側重於業務各個方面的長期改進，包括質量、銷售、營銷和運營流程、供應鏈優化、員工敬業度和組織管理結構。 Tammy 和 CHF 管理團隊堅持不懈地致力於卓越運營，領導團隊提高生產效率和質量管理，並平衡我們的產品組合以達到適當的產量和穩定的運行計劃。我們在將合適的人員安排到合適的位置並為 2024 財年的可持續改進奠定基礎方面取得了巨大進展。

The bedding industry is soft, and this slowness may remain for some period, but we can still improve our performance through improved operations. Assuming our sales volumes in the upcoming fiscal year did not fall materially below last year, we would expect to see significant progress with steady, sustainable improvement in CHF. We are planting seeds for the future of this business. And as macro conditions strengthen, we will further see the benefit of this transformation. Our CHF market position is solid, and we are growing with new program placements. We are also optimistic about additional planned program launches during this calendar year, although the timing of those launches could swing among quarters.

床上用品行業疲軟，這種放緩可能會持續一段時間，但我們仍然可以通過改善運營來提高業績。假設我們下一財年的銷量沒有大幅低於去年，我們預計瑞士法郎匯率將穩步、可持續地改善，取得重大進展。我們正在為這項業務的未來播下種子。隨著宏觀環境的改善，我們將進一步看到這種轉型的好處。我們的瑞士法郎市場地位穩固，並且我們隨著新計劃的投放而不斷成長。我們也對今年計劃推出的其他計劃持樂觀態度，儘管這些計劃的推出時間可能會因季度而異。

Pivoting now to Culp upholstery fabrics. Despite industry softness, this segment remains well positioned for the long term with our scalable global platform and innovative product offerings, including our popular portfolio of LiveSmart performance products and some new product technologies. We also expect this segment will benefit in fiscal 2024 from improved inventory management, a solid hospitality contract business, improvement in our Read Window business, and a rationalized cut-and-sew platform. We are also diligently managing our global platform within Culp upholstery fabrics as we look to provide options within our supply chain for both fabrics and cut-and-sew kits. Customer service is a hallmark for Culp and a diversified platform provides improved risk management and a more stable supply base.

現在轉向 Culp 室內裝飾面料。儘管行業疲軟，但憑藉我們可擴展的全球平台和創新產品（包括我們廣受歡迎的 LiveSmart 高性能產品組合和一些新產品技術），該細分市場長期處於有利地位。我們還預計該部門將在 2024 財年受益於庫存管理的改善、穩健的酒店合同業務、閱讀窗業務的改善以及合理化的裁剪和縫紉平台。我們還努力管理我們的 Culp 室內裝飾面料全球平台，因為我們希望在我們的供應鏈中為面料和裁剪和縫紉套件提供選擇。客戶服務是 Culp 的標誌，多元化的平台提供了改進的風險管理和更穩定的供應基礎。

Of note, our hospitality contract business accounted for 32% of segment sales for the fourth quarter. And while this percentage is higher than normal due to lower residential sales, it does reflect the ongoing solid performance of our hospitality contract business as well as its importance to our overall strategy of product diversification for the segment. I'll now turn the call over to Ken, who will review the financial results for the quarter, and then I'll come back and review the outlook for the fourth quarter of this fiscal year.

值得注意的是，我們的酒店合同業務佔第四季度部門銷售額的 32%。雖然由於住宅銷售下降，這一百分比高於正常水平，但它確實反映了我們的酒店合同業務持續穩健的業績及其對我們該領域產品多元化整體戰略的重要性。我現在將把電話轉給肯，他將審查本季度的財務業績，然後我將回來審查本財年第四季度的前景。

Thanks, Iv. As mentioned earlier on the call, we have posted a slide presentation to our Investor Relations website that covers certain summary financial information. We have also posted our updated investor presentation. Here are the financial highlights for the fourth quarter. Net sales were $61.4 million, up 7.9% compared to the prior year. The company reported a loss from operations of $4 million as compared with a loss of operations of $5.4 million for the prior year period and a loss some operations of $7.8 million for the third quarter this fiscal year, which included $711,000 in restructuring expense. I'll comment more detail on divisional sales and operating performance in a moment. Net loss for the fourth quarter was $4.7 million or $0.38 per diluted share compared with a net loss of $6 million or $0.49 per diluted share for the prior year period.

謝謝，四。正如前面在電話會議中提到的，我們已在投資者關係網站上發布了幻燈片演示文稿，其中涵蓋了某些摘要財務信息。我們還發布了更新的投資者演示文稿。以下是第四季度的財務亮點。淨銷售額為 6140 萬美元，比上年增長 7.9%。該公司報告運營虧損 400 萬美元，而上年同期運營虧損 540 萬美元，本財年第三季度部分運營虧損 780 萬美元，其中包括 711,000 美元的重組費用。我稍後將詳細評論部門銷售和運營業績。第四季度淨虧損為 470 萬美元，即稀釋後每股 0.38 美元，而去年同期淨虧損為 600 萬美元，即稀釋後每股 0.49 美元。

Our overall operating performance for the fourth quarter as compared to the prior year period was positively affected by higher sales in both divisions. It was also affected by improved margins on new products, improvement in operating efficiencies, and lower overhead costs in our mattress fabric segment during the quarter as well as receipt of nonrecurring customer payments, as Iv discussed earlier, lower inventory markdowns, lower overhead costs in our upholstery fabrics segment during the quarter and a favorable product mix. The lower overhead cost in our mattress fabric segment during the quarter related to the restructuring and rationalization of this segment's Culp Home mattress cover platform in North Carolina initiated during the second quarter of this fiscal year. The lower overhead costs in our upholstery fabrics segment during the quarter related to the restructuring and rationalization of this segment's cut-and-sew platforms initiated earlier in this fiscal year.

與去年同期相比，我們第四季度的整體經營業績受到兩個部門銷售額增加的積極影響。它還受到新產品利潤率提高、運營效率提高、本季度床墊面料部門管理成本降低以及收到非經常性客戶付款（正如 Iv 之前討論的）、庫存降價降低、管理成本降低的影響。本季度我們的室內裝飾面料部門和有利的產品組合。本季度床墊面料部門管理成本的降低與該部門位於北卡羅來納州的 Culp Home 床墊罩平台於本財年第二季度啟動的重組和合理化有關。本季度我們的室內裝飾面料部門的管理成本較低，這與本財年早些時候啟動的該部門裁剪和縫紉平台的重組和合理化有關。

The improvement in operating performance for the fourth quarter as compared to the prior year period was partially offset by a higher SG&A expense in the upholstery fabric segment and unallocated corporate due mostly to higher incentive compensation expense during the period. For the full fiscal year, net sales were $234.9 million, down 20.3% compared to the previous year. Loss from operations for the full fiscal year was $28.5 million compared with income from operations of $678,000 for the prior year. The awesome operation of this fiscal year includes $9.9 million relating to certain inventory impairment charges, losses from inventory closeout sales, inventory markdowns, and restructuring expenses-related charges during the period. Net loss for the full fiscal year was $31.5 million or $2.57 per diluted share compared with a net loss of $3.2 million or $0.26 per diluted share for the prior year. The effective income tax rate for the fourth quarter of this fiscal year was a negative 20.6% compared with a negative 4.4% for the same period a year ago. The effective income tax rate for the full fiscal year of 2023 was a negative 11% compared with a net of 888% for the prior fiscal year.

與上年同期相比，第四季度經營業績的改善被室內裝飾面料部門和未分配公司的銷售、管理及行政費用增加部分抵消，這主要是由於該期間激勵補償費用增加。整個財年淨銷售額為2.349億美元，比上年下降20.3%。整個財年的運營虧損為 2,850 萬美元，而上一年的運營收入為 678,000 美元。本財年的出色運營包括與某些庫存減值費用、庫存清倉銷售損失、庫存降價以及期間重組費用相關費用相關的 990 萬美元。整個財年的淨虧損為 3150 萬美元，即稀釋後每股 2.57 美元，而上一年的淨虧損為 320 萬美元，即稀釋後每股 0.26 美元。本財年第四季度的有效所得稅率為負20.6%，而上年同期為負4.4%。 2023 年整個財年的有效所得稅率為負 11%，而上一財年的淨稅率為 888%。

Our effective income tax rate for the fourth quarter and for the full fiscal year was impacted by the company's mix of earnings between our U.S. and foreign subsidiaries with an operating loss in the U.S., while China and Canada generated income that was taxed at higher rates as compared to the U.S. Our cash income tax payments totaled $2.3 million for this fiscal year, and we currently expect cash income tax payments of $2.5 million for the next fiscal year. Importantly, our estimated cash income tax payments for fiscal 2024 are management's current projections only and can be affected by a variety of factors over the course of the year. Now let's take a look at our business segments. For the mattress fabrics segment, sales for the fourth quarter were $30.7 million, up 3.1% compared with last year's fourth quarter and up 24.3% compared sequentially with the third quarter of this fiscal year. The improvement in sales was driven mostly by the rollout of new customer program despite a difficult industry demand environment during the quarter.

我們第四季度和整個財年的有效所得稅率受到公司美國和外國子公司之間的收入組合的影響，其中在美國存在經營虧損，而中國和加拿大產生的收入則按更高的稅率徵稅。與美國相比，我們本財年的現金所得稅繳納總額為 230 萬美元，目前預計下一財年的現金所得稅繳納額為 250 萬美元。重要的是，我們預計的 2024 財年現金所得稅支付額僅為管理層當前的預測，全年可能會受到多種因素的影響。現在讓我們來看看我們的業務部門。床墊面料領域，第四季度銷售額為3070萬美元，比去年第四季度增長3.1%，比本財年第三季度環比增長24.3%。儘管本季度行業需求環境困難，但銷售的改善主要是由於新客戶計劃的推出。

Importantly, these new programs are priced in line with current costs, and we expect the benefit as they expand across more sales channels and retail floors and as additional new product rollout launches during the calendar year. Operating loss for the quarter was $2.5 million compared with an operating loss of $2.9 million a year ago and an operating loss of $4.2 million in the previous quarter. Our operating performance for the fourth quarter this year as compared both sequentially and to the prior year period was favorably affected by higher sales, better margins on new products, improvement in operating efficiencies, and lower costs resulting from the restructuring and rationalization of the segment's mattress cover platform in North Carolina initiated during the second quarter of this fiscal year. For our upholstery Fabrics segment, sales for the fourth quarter were $30.7 million, up 13.1% over the prior year period, which was adversely affected by COVID-related shutdowns in China during the quarter.

重要的是，這些新計劃的定價與當前成本一致，我們預計隨著它們擴展到更多銷售渠道和零售樓層以及在日曆年內推出更多新產品，我們將受益匪淺。本季度運營虧損為 250 萬美元，而去年同期運營虧損為 290 萬美元，上一季度運營虧損為 420 萬美元。與上一季度和上年同期相比，我們今年第四季度的經營業績受到銷量增加、新產品利潤率提高、運營效率提高以及床墊部門重組和合理化帶來的成本降低的有利影響北卡羅來納州的封面平台於本財年第二季度啟動。對於我們的室內裝飾面料部門，第四季度銷售額為 3070 萬美元，比去年同期增長 13.1%，該季度受到中國與新冠病毒相關的停工的不利影響。

Sequentially, sales were up 10.4% compared to the third quarter of this fiscal year. Sales for our residential products improved sequentially as compared to the third quarter due to a seasonal pickup in demand following shutdowns in the Chinese New Year holiday, which fell entirely within the third quarter this year. Sales were also positively affected by the receipt of the $1 million nonrecurring payment I've mentioned earlier, relating to the newly negotiated terms with a cut and so customer. Demand remains solid in our hospitality contract business during the fourth quarter with sales for this business accounting for approximately 32% of the upholstery fabric segment's total sales. Income from operations for the quarter was $1.6 million compared with a loss of operations of $116,000 a year ago. Our operating performance for the fourth quarter this year, as comparable sequentially and the prior year period was positively affected by higher sales, including the $1 million nonrecurring payment mentioned above as well as favorable product mix, lower inventory markdowns, and lower overhead costs resulting from the restructuring of this segment's cut-and-sew platforms during earlier periods.

與本財年第三季度相比，銷售額增長了 10.4%。與第三季度相比，我們的住宅產品銷售環比有所改善，原因是農曆新年假期停工後需求季節性回升，而今年第三季度的農曆新年假期完全下降。收到我之前提到的 100 萬美元非經常性付款也對銷售產生了積極影響，該付款與與削減等客戶新協商的條款有關。第四季度我們的酒店合同業務需求依然強勁，該業務的銷售額約佔室內裝飾面料部門總銷售額的 32%。本季度運營收入為 160 萬美元，而去年同期運營虧損為 116,000 美元。與上一季度相比，我們今年第四季度的經營業績受到銷售額增加的積極影響，包括上述 100 萬美元的非經常性付款以及有利的產品組合、較低的庫存降價以及由於對該部門早期裁剪和縫紉平台的重組。

These factors were partially offset by higher incentive compensation expenses during the period due to this segment's significant contribution to the company's free cash flow for this fiscal year. Now I'll turn to the balance sheet. We reported $21 million in total cash and no outstanding debt as of the end of this fiscal year. This compares to $14.6 million in total cash and no outstanding debt as of the end of last fiscal year. Cash flow from operations and free cash flow were $7.8 million and $6.9 million, respectively, for this fiscal year as compared with cash flow from operations of free cash flow of a negative $17.4 million and negative $24.3 million, respectively, for last fiscal year. Our cash flow from operations and free cash flow during the fiscal year were favorably affected by working capital management, namely reductions in inventory. Importantly, since the end of the third quarter of last fiscal year, inventory reduction has contributed $21.1 million to the company's cash position.

由於該部門對公司本財年的自由現金流做出了重大貢獻，因此期間較高的激勵補償費用部分抵消了這些因素。現在我將轉向資產負債表。截至本財年末，我們的現金總額為 2100 萬美元，沒有未償債務。相比之下，截至上一財年末，現金總額為 1,460 萬美元，沒有未償債務。本財年的運營現金流和自由現金流分別為 780 萬美元和 690 萬美元，而上一財年的運營現金流和自由現金流分別為負 1,740 萬美元和負 2,430 萬美元。本財年我們的運營現金流和自由現金流受到營運資本管理（即庫存減少）的有利影響。重要的是，自上一財年第三季度末以來，庫存減少為公司現金狀況貢獻了2110萬美元。

Additionally, consistent with our focus on inventory, we tightly managed our capital spending during the year with an emphasis on our business-critical projects only. Capital expenditures were $2.1 million for the year compared with $5.7 million for the last fiscal year. Based on current expectations, capital expenditure for fiscal 2024 is perspective to be in the range of $4 million to $6 million and will center mostly on maintenance CapEx and projects focused on improving quality and efficiency in our mattress fabrics business. Depreciation for fiscal 2024 is expected to be approximately $7 million. With respect to liquidity, as of the end of fiscal 2023, we had $47.8 million, consisting of $21 million in total cash and $26.8 million in borrowing availability under our asset-based domestic credit facility. Borrowing availability under this facility is based on a calculation using certain of the company's accounts receivable and inventory determined on a monthly basis.

此外，與我們對庫存的關注相一致，我們在這一年中嚴格管理我們的資本支出，僅重點關注我們的關鍵業務項目。本年度資本支出為 210 萬美元，而上一財年的資本支出為 570 萬美元。根據目前的預期，2024 財年的資本支出預計在 400 萬至 600 萬美元範圍內，並將主要集中在維護資本支出以及專注於提高床墊面料業務質量和效率的項目上。 2024 財年的折舊預計約為 700 萬美元。在流動性方面，截至 2023 財年末，我們擁有 4780 萬美元，其中包括 2100 萬美元的現金總額和 2680 萬美元的基於資產的國內信貸安排下的可用借款。該設施下的借款可用性是根據公司每月確定的某些應收賬款和庫存進行計算的。

The company did not pay any dividends during this fiscal year following the suspension of our quarterly cash dividend on our common stock early in the year. The company also did not repurchase any shares during this fiscal year, leaving $3.2 million available under our current share repurchase program. Despite the current share repurchase authorization, we do not expect any activity during the first quarter of fiscal 2024 as we remain focused on preserving liquidity and being in a position to support future growth opportunities. With that, I'll turn the call back over to Iv.

在年初暫停普通股季度現金股息後，該公司在本財年沒有支付任何股息。該公司在本財年也沒有回購任何股票，因此我們當前的股票回購計劃還剩下 320 萬美元。儘管目前已獲得股票回購授權，但我們預計 2024 財年第一季度不會有任何活動，因為我們仍專注於保持流動性並有能力支持未來的增長機會。這樣，我會將電話轉回給 Iv。

Thanks, Ken. Due to the continued volatility in the macro environment, we have provided only limited financial guidance for the first quarter of fiscal 2024. We expect consolidated net sales for the first quarter to be slightly lower compared to the first quarter of fiscal 2023 due mostly to the current softness in the residential home accessories industry as well as some slowing of demand and the timing of additional new program launches in the mattress fabrics segment. We expect a consolidated operating loss for the first quarter of fiscal 2024, is in the range of negative $3.5 million to negative $4 million, a solid improvement compared to the $4.7 million operating loss for the prior year period. Now I know there are some questions about the expected slight decline in sales for the first quarter. And here now, we would discuss that. There continues to be a weakness in the residential home furnishing industry, which makes it a challenging revenue environment.

謝謝，肯。由於宏觀環境持續波動，我們僅對 2024 財年第一季度提供了有限的財務指引。我們預計第一季度的合併淨銷售額將略低於 2023 財年第一季度，主要原因是目前住宅家居配件行業的疲軟以及需求的放緩以及床墊面料領域額外新項目推出的時機。我們預計 2024 財年第一季度的綜合運營虧損將在負 350 萬美元至負 400 萬美元之間，與上年同期 470 萬美元的運營虧損相比，有了顯著改善。現在我知道對於第一季度銷售額的預期小幅下降存在一些疑問。現在，我們將在這裡討論這個問題。住宅家居行業持續疲軟，這使其收入環境充滿挑戰。

Yes, our hospitality contract business continues to look favorable, but the residential slowness is overweighing that. Also, remember that our fourth quarter sales for our residential upholstery fabrics business were positively affected by seasonality and a one-time payment that won't recur in the first quarter. On the mattress fabric side, while there is still overall malaise in the industry, we expect to continue to benefit from the launch of planned new programs for our customers. This is a business that we have won and that is scheduled to launch during calendar 2023, but the timing of those launches could swing between quarters, and we try to account for that in our quarterly guidance. Importantly, and I want to highlight this once more. Even with the forecasted decline in sales for the first quarter, we are still expecting a solid improvement in operating performance, reflecting the internal operational improvements we are making.

是的，我們的酒店合同業務繼續看起來不錯，但住宅業務的放緩壓倒了這一點。另外，請記住，我們的住宅裝飾面料業務第四季度的銷售受到季節性和第一季度不會重複的一次性付款的積極影響。在床墊面料方面，儘管行業整體仍不景氣，但我們預計將繼續受益於為客戶推出的計劃新項目。這是我們贏得的一項業務，計劃在 2023 年期間推出，但這些推出的時間可能會在季度之間波動，我們試圖在季度指導中考慮到這一點。重要的是，我想再次強調這一點。儘管預計第一季度銷售額將下降，但我們仍預計運營業績將穩步改善，這反映了我們正在進行的內部運營改進。

As we commented, we expect to improve our business sequentially and organically via market position during fiscal 2024 with a return to quarterly operating profit during the year. However, the pace of our improvement is dictated by the recovery in the macro environment, and we need some macro tailwinds for recovery to happen quicker. Lastly, as we weather the current challenges, we will continue to be laser-focused on prudent financial management with the goal of always maintaining a strong balance sheet, especially with regard to ensuring a strategic balance in our working capital. We are optimistic about Culp's future, and we know the financial stability is paramount to our success. So with that, we'll be happy to take some questions.

正如我們所評論的，我們預計將在 2024 財年期間通過市場地位連續、有機地改善我們的業務，並在年內恢復季度營業利潤。然而，我們改善的速度取決於宏觀環境的複蘇，我們需要一些宏觀的推動力才能更快地複蘇。最後，在應對當前挑戰的過程中，我們將繼續專注於審慎的財務管理，以始終保持強勁的資產負債表為目標，特別是確保營運資金的戰略平衡。我們對卡爾普的未來感到樂觀，我們知道財務穩定對我們的成功至關重要。因此，我們很樂意回答一些問題。

We will now begin the question-and-answer session. (Operator Instructions) Our first question comes from Anthony Lebiedzinski with Sidoti & Company.

我們現在開始問答環節。 （操作員說明）我們的第一個問題來自 Sidoti & Company 的 Anthony Lebiedzinski。

And first, congratulations on being able to maintain a strong balance sheet despite the difficulties in the business. I guess, the first question here, you talked about the comprehensive transformation and operational improvements that are underway at the CHF. I guess if you could put this in baseball terms, what inning are we in actually as far as these operational improvements?

首先，祝賀您在業務困難的情況下仍能保持強勁的資產負債表。我想，第一個問題，您談到了瑞士基金會正在進行的全面轉型和運營改進。我想如果你能用棒球術語來說的話，就這些操作改​​進而言，我們實際上處於第幾局？

Yes. Thank you, Anthony. I'm going to let Tammy speak to that a little bit because he's executing this plan with speed as fast as we can go. First of all, I'll thank you for the comments on the balance sheet. That is a big deal to us, and I'm glad you recognize that improvement. I'm really happy with how the CHF transformation is going. It would be going better if the market was better. But Tammy, I'll let you comment, if you want to where you see you are in the process and where you have left to execute.

是的。謝謝你，安東尼。我會讓塔米稍微談一下這一點，因為他正在以我們能達到的最快速度執行這個計劃。首先，我要感謝您對資產負債表的評論。這對我們來說很重要，我很高興您認識到這一改進。我對瑞士法郎轉型的進展感到非常滿意。如果市場好的話，事情會更好。但是塔米，如果您想了解自己處於流程中的哪個位置以及還需要執行的位置，我會讓您發表評論。

Yes, sure. Thanks for the question, Anthony. From my point of view, I would say that we're in the middle innings, getting towards the later innings. So we've established a good foundation. We've brought in a really good team to manage the transformation plan. And we have a good structure that is going to inform all of our activities and how we execute them. I think now it's just a matter of getting through them as quickly as possible and in a way that drives the most financial benefit and long-term benefit.

是的，當然。謝謝你的提問，安東尼。從我的角度來看，我想說我們正處於中局，即將進入後局。所以我們已經打下了良好的基礎。我們引進了一支非常優秀的團隊來管理轉型計劃。我們有一個良好的結構，可以為我們所有的活動以及我們如何執行這些活動提供信息。我認為現在的問題只是盡快解決這些問題，並以一種能夠帶來最大經濟效益和長期利益的方式。

And Anthony, it is interesting that you've started with the comments on the balance sheet because some of what Tammy needs to do is do some maintenance CapEx and be sure that we have equipment that's up to par for the speed we want to run and the techniques we want to operate through our platform. So the fact that our balance sheet is in a position to do some capital spending to support his transformation, they do go hand in hand.

安東尼，有趣的是，您已經開始對資產負債表進行評論，因為塔米需要做的一些事情是進行一些維護資本支出，並確保我們擁有符合我們想要運行速度的設備，並且我們希望通過我們的平台操作的技術。因此，事實上我們的資產負債表能夠進行一些資本支出來支持他的轉型，它們確實是齊頭並進的。

Understood. Okay. And then I know you guys also talked about in the past about the increased collaboration with the new innovation center. Have you been able to see that? Or do you think there's more to come in terms of just having the two segments to do more?

明白了。好的。我知道你們過去也談到了與新創新中心加強合作。你能看到嗎？或者您認為只要讓這兩個部門做更多的事情，還有更多的事情要做嗎？

Yes, I certainly believe, Anthony, for most of Culp's history or recent history, we've intentionally operated those two businesses separately. And they have two very strong leadership teams, but we are recognizing all the time that there are technologies and strategies, and platform locations that work for both businesses. So we don't ever want to lose the personalities of the business, but we do want to share ideas and best practices where we can. The innovation center was sort of step 1 and having our teams operate there concurrently with customers and watching our customers realize the different product lines that we're in, whether it be bedding, furniture, residential, commercial, it's been fantastic. I think our people enjoy being together, our customers like the atmosphere that provides, and that's been a nice -- as expected, a nice boost to the business.

是的，我當然相信，安東尼，在卡爾普的大部分歷史或最近的歷史中，我們有意分開經營這兩項業務。他們擁有兩個非常強大的領導團隊，但我們一直認識到，有適合這兩家企業的技術和戰略以及平台位置。因此，我們不想失去企業的個性，但我們確實希望盡可能地分享想法和最佳實踐。創新中心是第一步，讓我們的團隊與客戶同時在那裡運作，看著我們的客戶意識到我們所處的不同產品線，無論是床上用品、家具、住宅、商業，這真是太棒了。我認為我們的員工喜歡在一起，我們的客戶喜歡所提供的氛圍，這是一個很好的——正如預期的那樣，對業務的良好推動。

Terrific. Okay. Sounds great. So switching gears to the upholstery side. So you called out the demand being solid in the hospitality and contract business. So I guess a two-part question there. So first, are you getting more business from current clients? Or are you actually getting new client wins or maybe both? And then the second part of that question is, are you seeing any signs of any slowdown in that subsegment of the business?

了不起。好的。聽起來很棒。因此，將齒輪切換到內飾側。因此，您指出酒店和合同業務的需求強勁。所以我想這是一個由兩部分組成的問題。首先，您是否從現有客戶那裡獲得了更多業務？或者您實際上贏得了新客戶，或者兩者兼而有之？該問題的第二部分是，您是否看到該業務細分市場有任何放緩的跡象？

Yes, Anthony, this is Boyd. And as to the first question, I'd say the strength of the business, there's some contribution both from existing customers as the continuing to benefit from the shift in consumer spending to travel and experiences, it's certainly benefiting that segment and really all customers in that segment. So a lot of the strength in the solid incoming order and backlog position we have is related to existing customers, but we certainly are seeing new customer contributions in that as well. So it's really both fronts are contributing overall -- and to this point, no, for your second part of your question, we're really not seeing any signs of any downturns in that segment yet. As you know, those orders and backlogs do have a longer time frame for completion and installation. So we've got a pretty good backlog carrying out over a number of months at this point and really not seeing yet any signs of slowdown there. It remains very solid.

是的，安東尼，這是博伊德。至於第一個問題，我想說的是，業務的實力，現有客戶都做出了一些貢獻，因為消費者支出向旅行和體驗的轉變繼續受益，這肯定有利於該細分市場以及所有客戶。那段。因此，我們擁有的可靠的來貨訂單和積壓訂單的大部分優勢都與現有客戶有關，但我們當然也看到了新客戶的貢獻。因此，這兩個方面確實都在總體上做出了貢獻——就這一點而言，不，對於你問題的第二部分，我們確實還沒有看到該領域有任何衰退的跡象。如您所知，這些訂單和積壓的訂單確實需要更長的時間才能完成和安裝。因此，目前我們已經積壓了好幾個月的訂單，而且實際上還沒有看到任何放緩的跡象。它仍然非常堅固。

Okay. Got you. And then the last question. In terms of product pricing, what is your confidence level in terms of being able to continue to price products properly to reflect your own current costs?

好的。明白你了。然後是最後一個問題。在產品定價方面，您對能夠繼續正確定價產品以反映您當前成本的信心程度如何？

I feel very confident in that, Anthony. And it's just maybe it's confidence compared to where we were. We did talk a lot in this last fiscal year, which was a tough year, about always being behind the ick ball in terms of catching the cost. Things were going up on us faster than we could pass them through. Upholstery did a better job than mattress fabrics on that. And it's not a management thing. It's just the industry allowed us the different outcome. We just didn't keep pace on the mattress side. As we've gotten to the point now where so much of our business feels like it needs to be remerchandised and that's coming from retailers and customers wanting to freshen floors. We're able to have a lot of new introductions that set at proper margin. And it sounds obvious, but we just were in a period where we weren't getting fair margins on some of the business that was lingering now as we launch new things, it comes at a better prospect. So I don't feel -- it's always a competitive business. We're used to that for our entire history. But we have improving costs and we have new products with new technologies that we can price fairly. So I don't -- it's a competitive business, but I'm not worried about price pressure for us.

我對此非常有信心，安東尼。與我們當時的情況相比，這可能只是一種信心。在上一財年，這是艱難的一年，我們確實談論了很多關於在控製成本方面始終落後的問題。事情發生的速度比我們能承受的還要快。在這方面，室內裝潢比床墊面料做得更好。這不是管理的事情。只是行業給了我們不同的結果。我們只是在床墊方面沒有跟上步伐。現在我們已經到了這樣的地步：我們的大部分業務都需要重新銷售，而這來自於想要清潔地板的零售商和客戶。我們能夠以適當的幅度推出許多新產品。這聽起來很明顯，但我們正處於這樣一個時期，我們在一些業務上沒有獲得公平的利潤，而隨著我們推出新產品，這些業務現在仍然存在，但它的前景更好。所以我不覺得——這總是一個競爭激烈的行業。我們的整個歷史都習慣了這一點。但我們的成本不斷提高，我們擁有採用新技術的新產品，我們可以公平地定價。所以我不——這是一個競爭激烈的行業，但我並不擔心我們的價格壓力。

The next question comes from Rex Henderson with Water Tower Research.

下一個問題來自 Water Tower Research 的 Rex Henderson。

I want to offer my congratulations to the whole executive team and to Tammy in particular for showing some progress in CHF that's encouraging, particularly focused on the gross margin line, which turned positive for the first time in a while. And my question starts there, I think. The gross margin was positive this quarter, but not very strong yet. And I'm just wondering kind of where you are in the process of getting -- how many SKUs are there that are still negative margin products? And how long is it going to take to get to the point where the entire lineup is making money for you?

我想向整個執行團隊表示祝賀，特別是塔米，祝賀他們在瑞士法郎方面取得了一些令人鼓舞的進展，特別是在毛利率方面，毛利率在一段時間內首次轉為正數。我想我的問題就從這裡開始。本季度毛利率為正，但還不是很強勁。我只是想知道您在獲取過程中處於什麼位置 - 有多少 SKU 仍然是負利潤產品？需要多長時間才能達到整個陣容都為你賺錢的地步？

Yes. Thank you for the question, Rex. For us, we are working diligently on the SKU rationalization process that we've talked about previously. I would estimate that over the next quarter or two that we would be worked through on all of the SKUs that aren't productive for us. We're having those conversations daily. And as I've mentioned, a lot of the new programs that we're launching and as they phase in and become a larger part of our mix, as we rationalize out the lower profitability items and get the newer programs launched, we expect steady improvement in not only our top line, but we expect that to fall through on the bottom line as well.

是的。謝謝你的提問，雷克斯。對於我們來說，我們正在努力推進我們之前討論過的 SKU 合理化流程。我估計，在接下來的一兩個季度，我們將解決所有對我們沒有生產力的 SKU。我們每天都會進行這些對話。正如我所提到的，我們正在推出的許多新計劃，隨著它們逐步加入並成為我們組合的更大一部分，隨著我們合理化盈利能力較低的項目並推出新計劃，我們預計會穩定增長不僅我們的收入有所改善，而且我們預計利潤也會有所下降。

Okay. Great. So a couple of quarters to get to a more reasonable number. That's really encouraging.

好的。偉大的。因此需要幾個季度才能達到更合理的數字。這確實令人鼓舞。

Rex, just to make a point, I'm sure you're fully aware of this. I mean it would be -- an option would be just to stop selling those items. But we -- that's not a responsible supplier. We need to phase these out through the right process with our customers and support our customer for the long term, which we always will do, and to make that transition in the most expedient way we can. But we can't rush it. We just need to make it happen over hopefully a short period.

雷克斯，只是為了說明一點，我相信你完全意識到這一點。我的意思是——一個選擇就是停止銷售這些物品。但我們——那不是一個負責任的供應商。我們需要通過正確的流程與客戶一起逐步淘汰這些問題，並長期支持我們的客戶（我們將始終這樣做），並以最便捷的方式實現這一轉變。但我們不能操之過急。我們只需要讓它在短時間內實現即可。

Okay. The press release and in your comments, you also mentioned operating efficiencies. Can you quantify that a little bit? What's going on in terms of operating efficiencies in CHF?

好的。在新聞稿和評論中，您還提到了運營效率。你能稍微量化一下嗎？瑞士法郎的運營效率怎麼樣？

Yes, Rex, this is Ken. I think that's obviously one of the focuses that we've had, we've had issues with labor, getting the right mix of labor. That part of the challenge has calmed down. So we're getting more consistent labor there. I mean that's been a focus. Obviously, the rightsizing the business, getting the right run rates, and getting the costs in line there. So those have all been concurrent high priorities as we've gone through the last several months. And I know Tammy that's been your focus or is your focus now going forward. So it's hard to quantify. It's just we've got a number of initiatives that we're working on. And as I've said, we're confident that over time, our operating performance will reflect those.

是的，雷克斯，這是肯。我認為這顯然是我們關注的焦點之一，我們在勞動力、獲得正確的勞動力組合方面遇到了問題。這部分挑戰已經平靜下來。所以我們在那裡得到了更穩定的勞動力。我的意思是，這一直是一個焦點。顯然，需要調整業務規模，獲得正確的運行率，並使成本保持一致。因此，在過去的幾個月裡，這些都是我們同時面臨的高度優先事項。我知道塔米，這一直是你的重點，或者是你現在的重點。所以很難量化。只是我們正在採取一些舉措。正如我所說，我們相信隨著時間的推移，我們的經營業績將反映出這些。

Rex, if we were ranking, the most important thing to us to return profitability. The new volume at proper margin is first. So that's the first thing. And then the operational improvements are right behind it. And that's inclusive also of improved costing of materials, freight costs, and things like that, that are starting to help. So it's operating better in addition to better costing. But really, the main driver is going to be volume and new programs.

雷克斯，如果我們要排名，對我們來說最重要的是返回盈利能力。新成交量適當幅度第一。這是第一件事。運營改進就在其背後。這還包括改進材料成本、貨運成本等，這些都開始有所幫助。因此，除了更好的成本之外，它的運營也更好。但實際上，主要驅動力將是數量和新項目。

Okay. Actually, Ken touched on another question I had, and that is earlier you talked about you had some labor turnover and labor inefficiencies. Do you feel like that's fully behind you? Or is there still progress to be made on that front?

好的。實際上，肯談到了我的另一個問題，那就是您之前談到的勞動力流動和勞動力效率低下的情況。你覺得這完全在你身後嗎？或者說這方面還有待取得進展嗎？

I think, Rex, it's certainly better than it was. We went through a period of time where it was just difficult to retain anyone. I would say today, and Tammy can comment because he has the most U.S. employees. We aren't having problem finding workers anymore, but there is still some challenge in retaining workers. I mean the jobs we offer they're hard jobs. They're long hours and there's got to be some skilled labor there. So much better. Now we've got a lot of attention focused on retaining those people. Is that fair, Tammy, is what you're seeing?

我想，雷克斯，這肯定比以前好多了。我們經歷了一段很難留住任何人的時期。我今天會說，塔米可以發表評論，因為他擁有最多的美國員工。我們在尋找工人方面不再有問題，但在留住工人方面仍然存在一些挑戰。我的意思是我們提供的工作都是艱苦的工作。他們的工作時間很長，而且那裡必須有一些熟練工人。好多了。現在我們把很多注意力集中在留住這些人上。塔米，你所看到的公平嗎？

Yes. Yes, we're able to recruit effectively and we're working very hard on employee engagement and retention.

是的。是的，我們能夠有效地進行招聘，並且我們正在努力提高員工敬業度和保留率。

Okay. All right. And finally, I want to turn my attention to CUF in the home furnishings business. You mentioned that there's down -- I think you mentioned some downstream inventory issues. Can you give us any color on where that stands and how long you think that's going to take to clear? Do you have any visibility on that?

好的。好的。最後，我想把注意力轉向CUF的家居業務。你提到有下降——我想你提到了一些下游庫存問題。您能否告訴我們具體情況以及您認為需要多長時間才能清除？您對此有任何了解嗎？

Yes, Rex, this is Boyd. And I would say, to a large degree, those downstream inventories have been cleared and addressed, certainly in much lower levels of inventory in the pipeline at the retail and manufacturer level than there has been over the course of the last number of months in the year. So that situation has greatly improved. We are now seeing more of the true consumer purchases at retail are now triggering ordering fabrics to us on a more regular basis there. So a lot of that inventory position has been addressed. There's probably still some pockets in some various areas, but on a macro level, that's been significantly reduced and not as big a factor to our incoming pace of orders as it has been in the past couple of quarters.

是的，雷克斯，這是博伊德。我想說，在很大程度上，這些下游庫存已經得到清理和解決，零售和製造商層面的庫存水平肯定比過去幾個月要低得多。年。所以說這種情況已經有了很大的改善。我們現在看到，更多真正的消費者在零售店購買的商品正在促使他們更定期地向我們訂購面料。因此，很多庫存狀況已經得到解決。在某些不同領域可能仍然存在一些問題，但從宏觀層面來看，這種情況已經顯著減少，並且不像過去幾個季度那樣對我們的訂單增長速度產生重大影響。

Okay. Sounds a little bit of encouragement there. And I'll pass it on to the next guy.

好的。聽起來有點鼓勵。我會把它傳遞給下一個人。

This concludes our question-and-answer session. I would like to turn the conference over to Iv Culp for any closing remarks.

我們的問答環節到此結束。我想請艾夫·卡爾普 (Iv Culp) 負責本次會議的閉幕致辭。

Thank you, operator. And again, thanks to everyone for your participation and your interest in Culp. We look forward to updating you on our progress next quarter.

謝謝你，接線員。再次感謝大家的參與以及對 Culp 的興趣。我們期待向您通報下季度的最新進展。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連接。