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Segment Information
 9 Months Ended
Jan. 26, 2014
Segment Information
13. Segment Information

Our operations are classified into two business segments: mattress fabrics and upholstery fabrics. The mattress fabrics segment manufactures and sells fabrics and mattress covers to bedding manufacturers. The upholstery fabrics segment manufactures and sells fabrics primarily to residential furniture manufacturers.

We evaluate the operating performance of our segments based upon income from operations before certain unallocated corporate expenses, and other non-recurring items. Cost of sales in both segments include costs to 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 all costs related to being a public company. Segment assets include assets used in the operations of each segment and primarily consist of accounts receivable, inventories, and property, plant and equipment. The mattress fabrics segment also includes in segment assets, goodwill, a non-compete agreement, and customer relationships associated with an acquisition.
 
Financial information for the company’s operating segments follows:
 
Three months ended
(dollars in thousands)
 January 26, 2014 January 27, 2013
Net sales:
Mattress Fabrics $ 38,541 $ 35,513
Upholstery Fabrics 33,848 28,182
$ 72,389 $ 63,695
Gross profit:
Mattress Fabrics $ 5,599 $ 6,548
Upholstery Fabrics 6,238 5,137
$ 11,837 $ 11,685
Selling, general, and administrative expenses:
Mattress Fabrics $ 2,286 $ 2,382
Upholstery Fabrics 3,572 3,360
Total segment selling, general, and administrative expenses
 5,858 5,742
Unallocated corporate expenses 1,183 1,080
$ 7,041 $ 6,822
Income from operations:
Mattress Fabrics $ 3,313 $ 4,166
Upholstery Fabrics 2,666 1,777
Total segment income from operations
 5,979 5,943
Unallocated corporate expenses
 (1,183 ) (1,080 )
Total income from operations
 4,796 4,863
Interest expense
 (91 ) (145 )
Interest income
 148 105
Other expense
 (279 ) (300 )
Income before income taxes
 $ 4,574 $ 4,523

 

 
Nine months ended
(dollars in thousands)
January 26, 2014
January 27, 2013
Net sales:
Mattress Fabrics
 $ 117,035 $ 113,175
Upholstery Fabrics
 96,084 85,264
$ 213,119 $ 198,439
Gross profit:
Mattress Fabrics
 $ 20,312 $ 21,708
Upholstery Fabrics
 16,833 14,974
$ 37,145 $ 36,682
Selling, general, and administrative expenses:
Mattress Fabrics
 $ 7,280 $ 7,197
Upholstery Fabrics
 10,007 9,857
Total segment selling, general, and
administrative expenses
 17,287 17,054
Unallocated corporate expenses
 4,053 4,618
$ 21,340 $ 21,672
Income from operations:
Mattress Fabrics
 $ 13,033 $ 14,512
Upholstery Fabrics
 6,825 5,116
Total segment income from operations
 19,858 19,628
Unallocated corporate expenses
 (4,053 ) (4,618 )
Total income from operations
 15,805 15,010
Interest expense
 (330 ) (491 )
Interest income
 343 328
Other expense
 (895 ) (421 )
Income before income taxes
 $ 14,923 $ 14,426
 
Balance sheet information for the company’s operating segments follow:
 
(dollars in thousands)
January 26, 2014
January 27, 2013
April 28, 2013
Segment assets:
Mattress Fabrics
Current assets (1)
 $ 36,818 $ 34,595 $ 33,323
Non-compete agreement
 1,047 222 185
Customer relationships
 830 - -
Goodwill
 11,462 11,462 11,462
Property, plant and equipment (2)
 27,822 28,116 28,578
Total mattress fabrics assets
 77,979 74,395 73,548
Upholstery Fabrics
Current assets (1)
 33,261 31,839 28,487
Property, plant and equipment (3)
 1,649 1,147 1,230
Total upholstery fabrics assets
 34,910 32,986 29,717
Total segment assets
 112,889 107,381 103,265
Non-segment assets:
Cash and cash equivalents
 23,293 19,489 23,530
Short-term investments
 7,077 5,237 5,286
Deferred income taxes
 8,730 8,270 8,462
Income taxes receivable
 - - 318
Other current assets
 2,999 1,655 2,093
Property, plant and equipment (4)
 644 792 786
Other assets
 1,046 973 966
Total assets
 $ 156,678 $ 143,797 $ 144,706
 
Nine months ended
(dollars in thousands)
January 26, 2014
January 27, 2013
Capital expenditures (5):
Mattress Fabrics
 $ 1,936 $ 2,223
Upholstery Fabrics
 694 222
Unallocated Corporate
 37 149
Total capital expenditures
 $ 2,667 $ 2,594
Depreciation expense:
Mattress Fabrics
 $ 3,510 $ 3,344
Upholstery Fabrics
 454 474
Total depreciation expense
 $ 3,964 $ 3,818
 
(1)
Current assets represent accounts receivable and inventory for the respective segment.
(2)
The $27.8 million at January 26, 2014, represents property, plant, and equipment of $20.1 million and $7.7 million located in the U.S. and Canada, respectively. The $28.1 million at January 27, 2013, represents property, plant, and equipment of $20.6 million and $7.5 million located in the U.S. and Canada, respectively. The $28.6 million at April 28, 2013, represents property, plant, and equipment of $20.4 million and $8.2 million located in the U.S. and Canada, respectively.
(3)
The $1.6 million at January 26, 2014, represents property, plant, and equipment located in the U.S. of $1.0 million, located in China of $561, and located in Poland of $47. The $1.1 million at January 27, 2013, represents property, plant, and equipment located in the U.S. of $906, located in China of $155, and located in Poland of $86. The $1.2 million at April 28, 2013, represents property, plant, and equipment located in the U.S. of $908, located in China of $265, and located in Poland of $57.
(4)
The $644, $792, and $786 at January 26, 2014, January 27, 2013, and April 28, 2013, respectively, represent property, plant, and equipment associated with unallocated corporate departments and corporate departments shared by both the mattress and upholstery fabric segments. Property, plant, and equipment associated with corporate are located in the U.S.
(5)
Capital expenditure amounts are stated on the accrual basis. See Consolidated Statement of Cash Flows for capital expenditure amounts on a cash basis.