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Upholstery Fabrics Segment Restructuring | 6 Months Ended
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Oct. 29, 2023
Restructuring and Related Activities [Abstract] |
Upholstery Fabrics Segment Restructuring | 9. Upholstery Fabrics Segment Restructuring Ouanaminthe, Haiti During the third quarter of fiscal 2023, CUF Haiti entered into an agreement to terminate a lease associated with a facility located in Ouanaminthe, Haiti and, in turn, moved the production of upholstery cut and sewn kits to an existing facility leased by Culp Home Fashions Haiti, Ltd. (“CHF Haiti”) during the fourth quarter of fiscal 2023. Both CUF Haiti and CHF Haiti are indirect wholly-owned subsidiaries of the company. During the first quarter of fiscal 2024, demand for upholstery cut and sewn kits declined more than previously anticipated, resulting in the strategic action to discontinue the production of upholstery cut and sew kits in Haiti. The following summarizes our restructuring expense and restructuring related (credits) charges from the restructuring activities associated with our upholstery fabrics operations located in Haiti for the three months and six months ending October 29, 2023:
|  | Three Months Ended |  |  | Six Months Ended |
(dollars in thousands) |  | October 29, 2023 |  |  | October 29, 2023 |
Employee termination benefits |  | $ | 2 |  |  | $ | 103 |
Impairment loss - equipment |  |  | 142 |  |  |  | 379 |
(Gain) loss on disposal and markdowns of inventory |  |  | (78 | ) |  |  | 101 |
Restructuring expense and restructuring related (credits) charges (1) (2) |  | $ | 66 |  |  | $ | 583 |
(1) Of the total $66,000, $144,000 and ($78,000) were recorded within restructuring expense and cost of sales, respectively, in the Consolidated Statement of Net Loss for the three-month period ending October 29, 2023. (2) Of the total $583,000, $482,000 and $101,000 were recorded within restructuring expense and cost of sales, respectively, in the Consolidated Statement of Net Loss for the six-month period ending October 29, 2023. The restructuring activity related to the discontinuation of production of upholstery cut and sew kits in Haiti was completed as of October 29, 2023. As a result of our strategic decision to discontinue this production, we incurred a cumulative amount of $1.4 million in restructuring expense and restructuring related charges. The following summarizes the activity in accrued restructuring costs for the six-month period ending October 29, 2023:
|  |  | Employee |  |  |
|  |  | Termination |  |  |
(dollars in thousands) |  |  | Benefits |  | Total |
Beginning balance |  |  | $ | — |  | $ | — |
Expenses incurred |  |  |  | 103 |  |  | 103 |
Payments |  |  |  | (103 | ) |  | (103 | )
Ending balance |  |  | $ | — |  | $ | — |
Shanghai, China During the second quarter of fiscal 2023, we closed our cut and sew upholstery fabrics operation located in Shanghai, China, which included the termination of an agreement to lease a building. This strategic action, along with the further use of our Asian supply chain, was taken in order to adjust our operating costs to better align with the declining customer demand for cut and sewn products. The following summarizes our restructuring expense and restructuring related charges from the restructuring activities associated with our upholstery fabrics operations located in China for the three months and six months ending October 29, 2022:
|  | Three and Six Months Ended |
(dollars in thousands) |  | October 30, 2022 |
Employee termination benefits |  | $ | 468 |
Loss on disposal and markdowns of inventory |  |  | 98 |
Loss on disposal of equipment |  |  | 80 |
Lease termination costs |  |  | 47 |
Other associated costs |  |  | 20 |
Restructuring expense and restructuring related charges (3) |  | $ | 713 |
(3) Of the total $713,000, $615,000 and $98,000 were recorded to restructuring expense and cost of sales, respectively, in the Consolidated Statement of Net Loss for the three-month and six-month periods ending October 30, 2022. The following summarizes the activity in accrued restructuring costs for the three-month and six-month periods ending October 30, 2022:
|  | Employee |  |  | Lease |  |  | Other |  |  |
|  | Termination |  |  | Termination |  |  | Associated |  |  |
(dollars in thousands) |  | Benefits |  |  | Costs |  |  | Costs |  | Total |
Beginning balance |  | $ | — |  |  | $ | — |  |  | $ | — |  | $ | — |
Accrual established in fiscal 2023 |  |  | 468 |  |  |  | 47 |  |  |  | — |  |  | 515 |
Expenses incurred |  |  | — |  |  |  | — |  |  |  | 20 |  |  | 20 |
Payments |  |  | (468 | ) |  |  | (16 | ) |  |  | (18 | ) |  | (502 | )
Ending balance |  | $ | — |  |  | $ | 31 |  |  | $ | 2 |  | $ | 33 |
The restructuring activity related to the discontinuation of operations of the upholstery cut and sew kits in China was completed in the third quarter of fiscal 2023.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482017/420-10-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482017/420-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//420/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482017/420-10-50-1 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4(e)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479823/420-10-S99-2 + Details
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