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Revenue from Contracts with Customers
12 Months Ended
May 03, 2020
Revenue From Contract With Customer [Abstract]  
Revenue from Contracts with Customers

5.

REVENUE FROM CONTRACTS WITH CUSTOMERS

 

Nature of Performance Obligations

Continuing Operations

Our continuing operations are classified into two business segments: mattress fabrics and upholstery fabrics. The mattress fabrics segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery fabrics segment develops, manufactures, sources, and sells fabrics primarily to residential and commercial furniture manufacturers. Effective April 1, 2018, we acquired Read (see Note 2 located in the notes to the consolidated financial statement for further details), a turn-key provider of window treatments that offers sourcing of upholstery fabrics and other products, measuring, and installation services of their own products for the hospitality and commercial industries. In addition, Read supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows. Read is included in the upholstery fabrics segment.

Our primary performance obligations include the sale of mattress fabrics, upholstery fabrics, as well as the performance of customized fabrication and installation services of our own products associated with window treatments.

Discontinued Operation – Home Accessories Segment

As disclosed in Note 3 located in the notes to the consolidated financial statements, we sold our entire ownership interest in eLuxury on March 31, 2020, and consequently our home accessories segment was eliminated at such time. Additionally, the results of operations associated with our home accessories segment were excluded from our continuing operations and are presented as a discontinued operation in our consolidated financial statements.

The home accessories segment was our finished products business that manufactured, sourced, and sold bedding accessories and home goods directly to consumers and businesses through global e-commerce, business-to-business, and other sales channels.

Prior to its disposal, our former home accessories segment reported net sales totaling $13.8 million and $16.0 million during fiscal 2020 and 2019, respectively. Revenue associated with the sales of home accessories products were recognized at the point-in-time when control was transferred to the customer.

Significant Judgments

See Note 1 located in the notes to the consolidated financial statements for disclosure of our accounting policies regarding our significant judgements associated with revenue recognition, determining our transaction prices, and revenue measurement.

Contract Assets & Liabilities

Certain contracts, primarily those for customized fabrication and installation services associated with Read, require upfront customer deposits that result in a contract liability which is recorded on the Consolidated Balance Sheets as deferred revenue. If upfront deposits or prepayments are not required, customers may be granted credit terms which generally range from 15 – 60 days.  For a limited time, extended terms were granted to certain customers in response to the challenging business conditions resulting from the COVID-19 global pandemic. Our customary terms, as well as the limited extended terms, are common within the industries in which we operate and are not considered financing arrangements. There were no contract assets recognized as of May 3, 2020 and April 28, 2019.

A summary of the activity of deferred revenue follows:

 

(dollars in thousands)

 

Fiscal 2020

 

 

Fiscal 2019

 

Beginning Balance

 

$

399

 

 

$

809

 

Revenue recognized on contract liabilities during the period

 

 

(2,356

)

 

 

(2,725

)

Payments received for services not yet rendered during the period

 

 

2,459

 

 

 

2,315

 

Ending Balance

 

$

502

 

 

$

399

 

 

Disaggregation of Revenue

The following table presents our disaggregated revenue related to continuing operations by segment, timing of revenue recognition, and product sales versus services rendered for fiscal 2020:

 

(dollars in thousands)

 

Mattress

Fabrics

 

 

Upholstery

Fabrics

 

 

Total

 

Products transferred at a point in time

 

$

131,412

 

 

$

114,154

 

 

$

245,566

 

Services transferred over time

 

 

 

 

 

10,600

 

 

 

10,600

 

Total Net Sales

 

$

131,412

 

 

$

124,754

 

 

$

256,166

 

 

The following table presents our disaggregated revenue related to continuing operations by segment, timing of revenue recognition, and product sales versus services rendered for fiscal 2019:

 

(dollars in thousands)

 

Mattress

Fabrics

 

 

Upholstery

Fabrics

 

 

Total

 

Products transferred at a point in time

 

$

145,671

 

 

$

125,294

 

 

$

270,965

 

Services transferred over time

 

 

 

 

 

10,360

 

 

 

10,360

 

Total Net Sales

 

$

145,671

 

 

$

135,654

 

 

$

281,325