The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Doug Lane - Water Tower Research - Analyst
: Yeah, I was encouraged to see the free cash flow breakeven and the use from cash from operations -- the cash used from operations being
cut in half. So all the work you're doing is starting to come through, and I'm just trying to get a feel for where we are in the realization of all
these cost savings.
I know in the implementation, maybe you said you're in the late innings, but of that $20 million on slide 11, about how much of that do you
think is already being realized in the P&L and how much is still to come?
Question: Doug Lane - Water Tower Research - Analyst
: No, that does help. It sounds like heading into fiscal '27, you'll have a pretty clean run rate here. And then it's just a question of the benefit
of the next up cycle, whenever that happens. It's going to happen, and we just don't know when.
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DECEMBER 11, 2025 / 2:00PM, CULP.N - Q2 2026 Culp Inc Earnings Call
Question: Doug Lane - Water Tower Research - Analyst
: Is there any way -- have you done any math on what the incremental margin would be on the next point of sales growth? So as sales start
to move up, what would be the contribution margin from that incremental point of sales?
Question: Doug Lane - Water Tower Research - Analyst
: Got it. That makes sense. And I know you mentioned new tariffs in Turkey and Haiti. Can you give us a feel for when were those implemented?
And when do you think you'll be able to benefit from whatever mitigation efforts you put in place for them?
Question: Doug Lane - Water Tower Research - Analyst
: And the tariff situation on a week-to-week basis, is it still somewhat volatile? Or do you think it settled a little bit?
Question: Doug Lane - Water Tower Research - Analyst
: Well, clearly, you've been working hard in a very difficult environment. So we stay tuned.
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