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Intangible Assets | 12 Months Ended
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Apr. 27, 2025
Goodwill And Intangible Assets Disclosure [Abstract] |
Intangible Assets | 6. INTANGIBLE ASSETS A summary of intangible assets follows:
(dollars in thousands) |  | April 27, 2025 |  |  | April 28, 2024 |  |
Tradename |  | $ | — |  |  | $ | 540 |  |
Customer relationships, net |  |  | 734 |  |  |  | 1,035 |  |
Non-compete agreement, net |  |  | 226 |  |  |  | 301 |  |
|  | $ | 960 |  |  | $ | 1,876 |  |
Tradename A summary of the change in the carrying amount of our tradename follows:
(dollars in thousands) |  | 2025 |  |  | 2024 |  |  | 2023 |
beginning balance |  | $ | 540 |  |  | $ | 540 |  |  | $ | 540 |
loss on impairment |  |  | (540 | ) |  |  | — |  |  |  | — |
ending balance |  |  | — |  |  | $ | 540 |  |  | $ | 540 |
Our tradename pertains to Read, a separate reporting unit within our upholstery fabrics segment. This tradename was determined to have an indefinite useful life at the time of its acquisition, and therefore was not amortized. We are required to assess our tradename for impairment annually or between annual tests if we believe indicators of impairment exist. Accordingly, we performed our annual impairment assessment of Read's tradename as of April 27, 2025. Initially, we performed a qualitative assessment in which we concluded it was more-likely-than-not the fair value of Read's tradename was less than its carrying amount. This conclusion was based on management's decision, announced on April 24, 2025, to strategically transform the company's operating model by combining certain activities within the mattress fabrics and upholstery fabrics business segments and becoming one integrated and Culp-branded business. Since the company is transforming to a single Culp-branded business, Read's tradename will be phased out during fiscal 2026, and will no longer be used to market upholstery fabric products to customers associated with the hospitality industry. Consequently, we recorded an asset impairment charge totaling $540,000, which represents the entire carrying value of our Read tradename. This charge was classified as restructuring expense within our fiscal 2025 consolidated statement of net loss. Customer Relationships A summary of the change in the carrying amount of our customer relationships follows:
(dollars in thousands) |  | 2025 |  |  | 2024 |  |  | 2023 |
beginning balance |  | $ | 1,035 |  |  | $ | 1,335 |  |  | $ | 1,636 |
amortization expense |  |  | (301 | ) |  |  | (300 | ) |  |  | (301 | )
ending balance |  |  | 734 |  |  |  | 1,035 |  |  |  | 1,335 |
Our customer relationships are amortized on a straight-line basis over useful lives ranging from nine to seventeen years. The gross carrying amount of our customer relationships were $3.1 million as of April 27, 2025, and April 28, 2024. Accumulated amortization for our customer relationships were $2.4 million and $2.1 million as of April 27, 2025, and April 28, 2024, respectively. The remaining amortization expense for the next five fiscal years and thereafter follows: FY 2026 - $301,000; FY 2027 - $280,000; FY 2028 - $51,000; FY 2029 - $51,000; FY 2030 - $51,000. The weighted average amortization period for our customer relationships is 3.0 years as of April 27, 2025. Non-Compete Agreement A summary of the change in the carrying amount of our non-compete agreement follows:
(dollars in thousands) |  | 2025 |  |  | 2024 |  |  | 2023 |
beginning balance |  | $ | 301 |  |  | $ | 377 |  |  | $ | 452 |
amortization expense |  |  | (75 | ) |  |  | (76 | ) |  |  | (75 | )
ending balance |  | $ | 226 |  |  | $ | 301 |  |  | $ | 377 |
Our non-compete agreement is associated with a prior acquisition by our mattress fabrics segment and is amortized on a straight-line basis over the fifteen-year life of the agreement. The gross carrying amount of this non-compete agreement was $2.0 million as of April 27, 2025, and April 28, 2024. Accumulated amortization for this non-compete agreement was $1.8 million and $1.7 million as of April 27, 20 25, and April 28, 2024, respectively. The remaining amortization expense for the next five years and thereafter follows: FY 2026 - $76,000; FY 2027 - $76,000; and FY 2028 - $74,000. The weighted average amortization period for the non-compete agreement is 3.0 years as of April 27, 2025. Impairment of Definite Lived Assets - Mattress Fabrics Segment As of April 27, 2025, management reviewed the long-lived assets associated with our mattress fabrics segment, which consisted of property, plant, and equipment, right of use assets, and definite-lived intangible assets (collectively known as the "Mattress Asset Group"), for impairment, as events and changes in circumstances occurred that indicated the carrying amount of the Mattress Asset Group may not be recoverable. The mattress fabrics segment experienced a significant cumulative operating loss totaling $36.4 million commencing in the second quarter of fiscal 2023, and continuing through the fourth quarter of fiscal 2025. We believe this significant cumulative operating loss stemmed from a decline in consumer discretionary spending on mattress products, which we believe was driven by the following factors: (i) inflationary effects of commodities such as gas, food, and other necessities; (ii) a significant increase in interest rates; (iii) the pulling forward of demand for home goods products during the early years of the COVID-19 pandemic with such demand shifting to travel, leisure, and other services; and (iv) excess inventory held by customers due to the decline in consumer demand. Based on the above evidence, we were required to determine the recoverability of the Mattress Asset Group, which is classified as held and used, by comparing the carrying amount of the Mattress Asset Group to the sum of the future undiscounted cash flows expected to result from its use and eventual disposition. If the carrying amount of an asset group exceeds its estimated future cash flows, an impairment charge is recognized for the excess of the carrying amount over the fair value of the asset group. The carrying amount of the Mattress Asset Group totaled $23.9 million, which represents property, plant, and equipment of $23.3 million, right of use assets of $125,000, customer relationships of $255,000, and a non-compete agreement of $226,000. The total carrying amount of the Mattress Asset Group did not exceed the sum of its expected future undiscounted cash flows from its use and disposition. As a result, we determined there was no impairment associated with the Mattress Asset Group as of April 27, 2025.

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