content: ------------------------------------------------------------------
  
  
                        SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C. 20549
  
                                     ---------
  
                                     Form 8-K
  
                                  CURRENT REPORT
  
                 Pursuant to Section 13 or 15(d) of the Securities
                               Exchange Act of 1934
  
                                   -------------
  
         Date of Report (Date of earliest event reported) February 17, 1999
  
                                     CULP, INC.
  
              (Exact name of registrant as specified in its charter)
  
  
          North Carolina                  0-12781                56-1001967
   (State or other jurisdiction    (Commission File No.)       (IRS Employer
         of incorporation)                                  Identification No.)
  
  
  
                               101 South Main Street
                         High Point, North Carolina  27260
                     (Address of principal executive offices)
                                  (336) 889-5161
               (Registrant's telephone number, including area code)
  
  
  
  
                                                                                
           (Former name or former address, if changed since last report)
  
  
  
  
  
  -------------------------------------------------------------------
  
  <PAGE>
  
  
  Item 5. Other Events
  
  See  attached  Press  Release (2 pages) and  Financial  Information  Release (10
  pages),  both dated February 17, 1999,  related to the fiscal 1999 third quarter
  ended January 31, 1999.
  
  Forward  Looking  Information.  This Report  contains  statements  that could be
  deemed   "forward-looking   statements"   within  the  meaning  of  the  federal
  securities   laws.  Such   statements  are  inherently   subject  to  risks  and
  uncertainties.   Forward-looking   statements   are   statements   that  include
  projections,   expectations  or  beliefs  about  future  events  or  results  or
  otherwise are not  statements  of historical  fact.  Such  statements  are often
  characterized  by  qualifying  words such as  "expect,"  "believe,"  "estimate,"
  "plan" and "project"  and their  derivatives.  Factors that could  influence the
  matters  discussed in such  statements  include the level of housing  starts and
  sales of existing homes,  consumer confidence,  trends in disposable income, and
  general  economic  conditions.  Decreases  in these  economic  indicators  could
  have a  negative  effect on the  Company's  business  and  prospects.  Likewise,
  increases in interest rates,  particularly  home mortgage  rates,  and increases
  in consumer  debt or the general  rate of  inflation,  could  affect the Company
  adversely.  Because  of  the  significant  percentage  of  the  Company's  sales
  derived by  international  shipments,  strengthening of the U. S. dollar against
  other  currencies  could make the  Company's  products less  competitive  on the
  basis of price in markets  outside  the United  States.  Additionally,  economic
  and political  instability  in  international  areas could affect the demand for
  the Company's products.
   
  
  
                                     SIGNATURE
  
  
  Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
  Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
  undersigned hereunto duly authorized.
  
   
                                      CULP, INC.
                                      (Registrant)
  
  
                                By:    Phillip W. Wilson                         
                                       Vice President and
                                       Chief Financial Officer
  
  
   
  
  
  
  Dated:   February 17, 1999
  
  
  <PAGE>
  
  FOR IMMEDIATE RELEASE
  
  
                        CULP REPORTS THIRD QUARTER EARNINGS
  
  
  HIGH  POINT,  N.C.  (Feb.  17,  1999) - Culp,  Inc.  (NYSE:CFI)  today  reported
  earnings for the third fiscal quarter ended January 31, 1999.
  
        For the three  months  ended  January 31,  1999,  Culp  reported  that net
  sales  amounted to $112.1  million  compared with $118.5 million a year ago. Net
  income for the quarter was $1.5 million,  or $0.12 per share  diluted,  compared
  with $4.0 million, or $0.31 per share diluted.
  
        Net sales for the first nine months totaled  $350.9 million  compared with
  $340.9  million  in the first  nine  months of fiscal  1998.  Net income for the
  first nine  months  amounted to  $206,000,  or $0.02 per share  diluted,  versus
  $11.4 million, or $0.88 per share diluted.
  
        "We are  continuing  to achieve  operational  progress  as a result of the
  organizational  restructuring  completed  earlier  this  year,"  said  Robert G.
  Culp,  III, chief executive  officer.  "The third fiscal quarter is historically
  not  the  strongest  period  of the  year  for  our  business  due  to  seasonal
  factors.  Although  net income for the third  quarter was lower than a year ago,
  the level of  profitability  did improve from the second period.  We believe the
  underlying  momentum  is  positive  in several  key  corporate  areas.  Customer
  service  has been  enhanced  as a result of the  decision to combine our various
  operations by major product  categories.  This alignment is  encouraging  closer
  working  relationships  with  accounts and  assisting us in the vital process of
  creating  new  fabric  designs  and  textures.  Our  intent  is to  link  design
  resources with  manufacturing  capabilities  in order to provide the marketplace
  with innovative  designs that offer  compelling  value for furniture and bedding
  manufacturers."
  
        Culp added,  "As we have  indicated,  we believe the impact of the changes
  that have been  implemented  will  continue  into fiscal 2000.  We are confident
  about the fundamental  growth  opportunities  for Culp both in the United States
  and  internationally  and are encouraged by the continuing  favorable  trends in
  measures  such as consumer  confidence,  employment  levels and  mortgage  rates
  that have an important influence on consumer spending on home furnishings."
  
  
        Culp,   Inc.  is  the  world's  largest   manufacturer   and  marketer  of
  upholstery  fabrics for furniture and is a leading  producer of mattress ticking
  for bedding.  The  Company's  fabrics are used  primarily in the  production  of
  residential and commercial furniture and bedding products.
  <PAGE>
  
                                     CULP, INC.
                           Condensed Financial Highlights
                                    (Unaudited)
                                                       Three Months Ended     
                                                  January 31,       February 1,
                                                     1999             1998    
  Net sales                                      $112,093,000      $118,457,000
  Net income                                        1,539,000         4,002,000
  Net income per share
    Basic                                        $       0.12      $       0.32
    Diluted                                      $       0.12      $       0.31
  Average shares outstanding
    Basic                                          12,995,000        12,692,000
    Diluted                                        13,124,000        12,986,000
  
                                                        Nine Months Ended       
                                                  January 31,       February 1,
                                                     1999              1998   
  Net sales                                      $350,919,000      $340,881,000
  Net income                                          206,000        11,357,000
  Net income per share
    Basic                                        $       0.02      $       0.90
    Diluted                                      $       0.02      $       0.88
  Average shares outstanding
    Basic                                          12,997,000        12,663,000
    Diluted                                        13,171,000        12,964,000
  
  This  release  contains   statements  that  could  be  deemed   "forward-looking
  statements,"   within  the  meaning  of  the  federal   securities   laws.  Such
  statements are inherently  subject to risks and  uncertainties.  Forward-looking
  statements  are statements  that include  projections,  expectations  or beliefs
  about future  events or results or otherwise  are not  statements  of historical
  fact.  Such  statements  are often  characterized  by  qualifying  words such as
  "expect,"  "believe,"  "estimate,"  "plan" and "project" and their  derivatives.
  Factors that could influence the matters  discussed in such  statements  include
  the level of housing starts and sales of existing  homes,  consumer  confidence,
  trends in  disposable  income and  general  economic  conditions.  Decreases  in
  these  economic  indicators  could  have a  negative  effect  on  the  company's
  business and  prospects.  Likewise,  increases in interest  rates,  particularly
  home  mortgage  rates,  and  increases  in consumer  debt or the general rate of
  inflation,  could  affect the  company  adversely.  Because  of the  significant
  percentage  of  the  company's   sales  derived  by   international   shipments,
  strengthening  of the  U.S.  dollar  against  other  currencies  could  make the
  company's  products less  competitive  on the basis of price in markets  outside
  the  United  States.   Additionally,   economic  and  political  instability  in
  international areas could affect the demand for the company's products.
                                        -END-
  <PAGE>
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                          CONSOLIDATED STATEMENTS OF INCOME
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
  
  <TABLE>
  <CAPTION>
                  (Amounts in Thousands, Except for Per Share Data)
  
                                                    THREE MONTHS ENDED (UNAUDITED)
                                      -----------------------------------------------------------
                                             Amounts                             Percent of Sales
                                      ----------------------                    --------------------
                                      January 31, February 1,  % Over
                                       1999        1998         (Under)           1999      1998
                                      ----------  ----------  --------------    ---------  ---------
  
  <S>                           <C>                 <C>        <C>               <C>       <C>    
  Net sales                     $       112,093     118,457     (5.4)%           100.0 %   100.0 %
  Cost of sales                          92,911      97,554     (4.8)%            82.9 %    82.4 %
                                      ----------  ----------  --------------    ---------  ---------
        Gross profit                     19,182      20,903     (8.2)%            17.1 %    17.6 %
  
  Selling, general and
    administrative expenses              14,100      13,162      7.1 %            12.6 %    11.1 %
                                      ----------  ----------  --------------    ---------  ---------
        Income from operations            5,082       7,741    (34.3)%             4.5 %     6.5 %
  
  Interest expense                        2,308       2,180      5.9 %             2.1 %     1.8 %
  Interest income                           (10)        (73)   (86.3)%            (0.0)%    (0.1)%
  Other expense (income), net               492         492      0.0 %             0.4 %     0.4 %
                                      ----------  ----------  --------------    ---------  ---------
        Income before income taxes        2,292       5,142    (55.4)%             2.0 %     4.3 %
      
  Income taxes  *                           753       1,140    (33.9)%            32.9 %    22.2 %
                                      ----------  ----------  --------------    ---------  ---------
        Net income              $         1,539       4,002    (61.5)%             1.4 %     3.4 %
                                      ==========  ==========  ==============    =========  =========
  
  Net income per share                    $0.12       $0.32    (62.5)%
  Net income per share, assuming dilution $0.12       $0.31    (61.3)%
  Dividends per share                    $0.035      $0.035      0.0 %
  Average shares outstanding             12,995      12,692      2.4 %
  Average shares outstanding,            
   assuming dilution                     13,124      12,986      1.1 %
  
  
                                                    NINE MONTHS ENDED (UNAUDITED)
                                      -----------------------------------------------------------
  
                                             Amounts                             Percent of Sales
                                      ----------------------                    --------------------
                                      January 31,  February 1,   % Over
                                         1999        1998         (Under)         1999      1998
                                      ----------  ----------  --------------    ---------  ---------
  
  Net sales                     $       350,919     340,881      2.9 %           100.0 %   100.0 %
  Cost of sales                         297,652     280,510      6.1 %            84.8 %    82.3 %
                                      ----------  ----------  --------------    ---------  ---------
        Gross profit                     53,267      60,371    (11.8)%            15.2 %    17.7 %
  
  Selling, general and
    administrative expenses              44,047      37,710     16.8 %            12.6 %    11.1 %
                                      ----------  ----------  --------------    ---------  ---------
        Income from operations            9,220      22,661    (59.3)%             2.6 %     6.6 %
  
  Interest expense                        7,133       5,280     35.1 %             2.0 %     1.5 %
  Interest income                           (82)       (235)   (65.1)%            (0.0)%    (0.1)%
  Other expense (income), net             1,866       1,159     61.0 %             0.5 %     0.3 %
                                      ----------  ----------  --------------    ---------  ---------
        Income before income  taxes         303      16,457    (98.2)%             0.1 %     4.8 %
       
  Income taxes  *                            97       5,100    (98.1)%            32.0 %    31.0 %
                                      ----------  ----------  --------------    ---------  ---------
         Net income              $          206      11,357    (98.2)%             0.1 %     3.3 %
                                      ==========  ==========  ==============    =========  =========
  
  Net income per share                    $0.02       $0.90    (97.8)%
  Net income per share,assuming dilution  $0.02       $0.88    (97.7)%
  
  Dividends per share                    $0.105      $0.105      0.0 %
  Average shares outstanding             12,997      12,663      2.6 %
  Average shares outstanding,            
  assuming dilution                      13,171      12,964      1.6 %
  
  </TABLE>
  
   * Percent of sales column is calculated as a % of
  income before income taxes.
  
  <PAGE>
  
                           CULP, INC. FINANCIAL INFORMATION RELEASE
                                  CONSOLIDATED BALANCE SHEETS
                      JANUARY 31, 1999, FEBRUARY 1, 1998 AND MAY 3, 1998
                                           Unaudited
  <TABLE>
  <CAPTION>
                                    (Amounts in Thousands)
  
                                             Amounts                 
                                    ---------------------------        Increase
                                    January 31,    February 1,        (Decrease)         *  
                                                              ----------------------   May 3,
                                        1999         1998       Dollars     Percent     1998
                                    -------------  ----------  ----------   ---------  -------
  Current assets
  <S>                             <C>                <C>         <C>        <C>       <C>  
       Cash and cash  investments $          655         348         307      88.2 %     2,312
       Accounts receivable                63,090      73,109     (10,019)    (13.7)%    73,773
       Inventories                        69,210      75,032      (5,822)     (7.8)%    78,594
       Other current assets                7,560       7,202         358       5.0 %     7,808
                                    -------------  ----------  ----------   ---------   -------
               Total current  assets     140,515     155,691     (15,176)     (9.7)%   162,487
             
  Restricted investments                   3,416       3,976        (560)    (14.1)%     4,021
  Property, plant & equipment, net       125,885     113,658      12,227      10.8 %   128,805
  Goodwill                                51,615      48,558       3,057       6.3 %    55,162
  Other assets                             5,017       5,439        (422)     (7.8)%     4,340
                                    -------------  ----------  ----------   ---------   -------
                                                                             
               Total assets       $      326,448     327,322       (874)     (0.3) %   354,815
                                    =============  ==========  ==========   =========   =======
  
                                                                             
                                                                             
  Current liabilities
       Current maturities of      
        long-term debt            $        1,678       1,120         558      49.8 %     3,325
       Accounts payable                   25,808      35,921     (10,113)    (28.2)%    37,214
       Accrued expenses                   17,317      12,683       4,634      36.5 %    17,936
       Income taxes payable                    0       1,941      (1,941)   (100.0)%     1,282
                                    -------------  ----------  ----------   ---------   -------
            Total current liabilities     44,803      51,665      (6,862)    (13.3)%    59,757
               
  Long-term debt                         140,210     144,079      (3,869)     (2.7)%   152,312
   
  Deferred income taxes                   11,227       9,965       1,262      12.7 %    11,227
                                    -------------  ----------  ----------   ---------  -------
            Total liabilities            196,240     205,709      (9,469)     (4.6)%   223,296
              
  Shareholders'equity                    130,208     121,613       8,595       7.1 %   131,519
                                    -------------  ----------  ----------   ---------  -------
                                                                             
            Total liabilities and                                                        
            shareholders' equity  $      326,448     327,322       (874)      (0.3)%   354,815
                                    =============  ==========  ==========   =========  =======
                                                                             
  Shares outstanding                      12,995      12,700         295       2.3 %    13,007
                                    =============  ==========  ==========   =========  =======
  </TABLE>
  
  
  *  Derived from audited financial statements.
  
  <PAGE>
  
                                     CULP, INC.
                            FINANCIAL INFORMATION RELEASE
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
           FOR THE NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
                                      Unaudited
                               (Amounts in Thousands)
  
  <TABLE>
  <CAPTION>
                                                               NINE MONTHS ENDED
                                                            ------------------------
                                                                     Amounts
                                                            ----------------------
                                                          January 31,  February 1,
                                                              1999       1998
                                                           ----------- ----------
  Cash flows from operating activities:                                    
  <S>                                                     <C>            <C>   
      Net income                                          $        206     11,357
      Adjustments to reconcile net income to net cash
        provided by (used in) operating activities:
           Depreciation                                         13,785     10,660
           Amortization of intangible assets                     1,174        883
           Changes in assets and liabilities:
             Accounts receivable                                10,546    (16,418)
             Inventories                                         9,984    (16,330)
             Other current assets                                  303     (1,752)
             Other assets                                          (95)    (1,942)
             Accounts payable                                   (8,609)     8,783
             Accrued expenses                                     (973)    (2,175)
             Income taxes payable                               (1,282)       361
                                                             ----------- ---------
                Net cash provided by (used in) operating         
                 activities                                     25,039     (6,573)
                                                             ----------- ---------
  Cash flows from investing activities:                                    
      Capital expenditures                                      (8,500)   (28,183)
      Purchases of restricted investments                          (73)    (8,724)
      Purchase of investments to fund deferred                    
       compensation liability                                     (735)      (581)
      Sale of restricted investments                               678     15,766
      Businesses acquired                                            0    (37,156)
                                                             ----------- ---------
                Net cash used in investing activities           (8,630)   (58,878)
                                                             ----------- ---------
  Cash flows from financing activities:                                    
      Proceeds from issuance of long-term debt                   2,535     77,600
      Principal payments on long-term debt                     (16,284)    (9,042)
      Change in accounts payable-capital expenditures           (2,800)    (2,765)
      Dividends paid                                            (1,365)    (1,333)
      Common stock issued (purchased)                             (152)       509
                                                             ----------- --------
                Net cash provided by (used in) financing        
                 activities                                    (18,066)    64,969
                                                             ----------- ---------
  Decrease in cash and cash investments                         (1,657)      (482)
                                                                          
  Cash and cash investments at beginning of period               2,312        830
                                                             ----------- ---------
                                                                           
  Cash and cash investments at end of period               $       655        348
                                                             =========== =========
  </TABLE>
   
  <PAGE>
  
  
  
                          CULP, INC. FINANCIAL INFORMATION RELEASE
                                     FINANCIAL ANALYSIS
                                      JANUARY 31, 1999
  
  <TABLE>
  <CAPTION>
                                                       
                                           FISCAL 98                 FISCAL 99
                                           --------  ---------------------------------------   ---------
                                             Q3         Q1        Q2        Q3        Q4         LTM
                                           --------  ---------------------------------------   ---------
  
  INVENTORIES
  <S>                                      <C>         <C>       <C>       <C>                <C>  
        Inventory turns                       5.4         4.9       5.7       5.2
  
  RECEIVABLES
        Days sales in receivables              52          48        52        47
        Percent current &
         less than 30 days past due          94.1%       93.8%     94.9%     94.1%
              
  WORKING CAPITAL
        Current ratio                         3.0         3.1       3.0       3.1
        Working capital turnover (4)          4.7         4.5       4.4       4.4
        Operating working capital (4)      $112,220   $111,481  $112,750  $106,492
        
  PROPERTY, PLANT & EQUIPMENT
        Depreciation rate                     7.4%        7.7%      8.4%      7.9%
        Percent property, plant &
         equipment are depreciated           44.8%       43.8%     45.0%     46.1%
        Capital expenditures               $35,879 (1)  $2,858    $3,585    $2,057
        
  
  PROFITABILITY
        Return on average total capital       8.3%      (1.6%)      4.2%      4.5%                 3.8%
        Return on average equity             13.4%      (8.1%)      4.1%      4.7%                 3.4%
        Net income (loss) per share          $0.32     ($0.20)     $0.10     $0.12                $0.34
        Net income (loss) per   
         share (diluted)                     $0.31     ($0.20)     $0.10     $0.12                $0.33
  
  LEVERAGE (3)
        Total liabilities/equity            169.2%      167.2%    164.9%    150.7%
        Funded debt/equity                  116.1%      119.7%    115.0%    106.3%
        Funded debt/capital employed         53.7%       54.5%     53.5%     51.5%
        Funded debt                       $141,223    $153,559  $148,479  $138,472
        Funded debt/EBITDA (LTM) (6)          2.95        3.75      3.95      3.91
        EBITDA/Interest                        
         expense, net (LTM)                    7.5      4.9       4.2       3.9
    
  OTHER
        Book value per share               $9.58       $9.87     $9.94    $10.02
        Employees at quarter end           3,771       4,230     4,014     3,949
        Sales per employee (annualized) $129,000    $103,000  $124,000  $113,000
        Capital employed (3)            $262,836    $281,831  $277,603  $268,680
        Effective income tax rate          22.2%       33.0%     33.0%     32.9%
        EBITDA  (2)                      $11,390      $3,142    $9,649    $9,522                $34,109
        EBITDA/net sales                    9.6%        2.8%      7.5%      8.5%                   7.0%
         
  </TABLE>
  
    (1) Expenditures for entire year
    (2) Earnings before interest, income taxes, and depreciation & amortization.
    (3) Long-term debt, funded debt and capital employed are all net of restricted
        investments.
    (4) Working capital for this calculation is accounts receivable, inventories 
        and accounts payable.
    (5) LTM represents "Latest Twelve Months"
    (6) EBITDA includes capitalized interest and pro forma amounts for 
        acquisitions.
  
  <PAGE>
  
  
                    CULP, INC. FINANCIAL INFORMATION RELEASE
                     SALES BY PRODUCT CATEGORY/BUSINESS UNIT
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
                               (Amounts in thousands)
  <TABLE>
  <CAPTION>
                                       THREE MONTHS ENDED (UNAUDITED)
                             ---------------------------------------------------
                                  Amounts                      Percent of Total
                                                                    Sales
                             ------------------               -------------------
                             January 31, February 1, % Over
  Product                        1999      1998      (Under)      1999      1998
  Category/Business Unit
  -------------------------   ---------  ---------  ----------  --------  --------
  <S>                         <C>         <C>      <C>         <C>        <C>  
  Upholstery Fabrics
      Culp Decorative Fabrics $  50,520    53,415    (5.4)%     45.1 %     45.1 %
      Culp Velvets/Prints        34,949    44,020   (20.6)%     31.2 %     37.2 %
                               --------  --------  ----------  --------  ---------
                                 85,469    97,435   (12.3)%     76.2 %     82.3 %
  
  Mattress Ticking
      Culp Home Fashions         22,536    20,261    11.2 %     20.1 %     17.1 %
  
  Yarn
     Culp Yarn                    4,088       761   437.2 %      3.6 %      0.6 %
                               --------  --------  ----------  --------  ---------
  
                            * $ 112,093   118,457    (5.4)%     100.0%    100.0 %
                               ========  ========  ==========  ========  =========
  
  
                                       NINE MONTHS ENDED (UNAUDITED)
                             ---------------------------------------------------
  
                                  Amounts                      Percent of Total
                                                                    Sales
                             ------------------               -------------------
                            January 31, February 1,   % Over
  Product                       1999      1998      (Under)      1999      1998
  Category/Business Unit
  -------------------------  ---------  ---------  ----------  --------  ---------
  Upholstery Fabrics
      Culp Decorative Fabrics $ 161,538   150,010       7.7 %     46.0 %     44.0 %
  
      Culp Velvets/Prints       103,671   126,345     (17.9)%     29.5 %     37.1 %
                               --------  --------   ----------  --------  ---------
                                265,209   276,355      (4.0)%     75.6 %     81.1 %
  
  Mattress Ticking
      Culp Home Fashions         68,659    63,765       7.7 %     19.6 %     18.7 %
  
  Yarn
     Culp Yarn                   17,051       761   2,140.6 %      4.9 %      0.2 %
                               --------  --------   ----------  --------  ---------
  
                            * $ 350,919   340,881       2.9 %     100.0%    100.0 %
                               ========  ========   ==========  ========  =========
  </TABLE>
  
  
  * U.S.  sales were $88,152 and $79,873 for the third  quarter of fiscal 1999 and
  fiscal  1998,  respectively;  and  $266,934  and $242,123 for the nine months of
  fiscal 1999 and fiscal 1998, respectively. The percentage increase in U.S. sales
  was 10.4% for the third quarter and an increase of 10.2% for the nine months.
  
  <PAGE>
  
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                       INTERNATIONAL SALES BY GEOGRAPHIC AREA
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
  
                               (Amounts in thousands)
  
  <TABLE>
  <CAPTION>
                                         THREE MONTHS ENDED (UNAUDITED)
                             -------------------------------------------------------
  
                                           Amounts                        Percent of Total
                                                                                Sales
                                      ---------------------               ---------------------
                                      January 31,  February 1,  % Over
     Geographic Area                    1999        1998       (Under)      1999       1998
  -----------------------            -----------  ----------  ---------   ---------   ---------
  <S>                           <C>              <C>           <C>          <C>        <C>   
  North America (Excluding USA) $       7,280      7,562         (3.7)%       30.4 %     19.6 %
  Europe                                3,881     11,581        (66.5)%       16.2 %     30.0 %
  Middle East                           6,711      9,326        (28.0)%       28.0 %     24.2 %
  Far East & Asia                       4,993      7,957        (37.3)%       20.9 %     20.6 %
  South America                           555      1,230        (54.9)%        2.3 %      3.2 %
  All other areas                         521        928        (43.9)%        2.2 %      2.4 %
                                   ----------  ---------      ---------    ---------   ---------
  
                                $      23,941     38,584        (38.0)%      100.0 %    100.0 %
                                   ==========  =========        =========  =========   =========
  
  
                                         NINE MONTHS ENDED (UNAUDITED)
                             -------------------------------------------------------
                                      Amounts                       Percent of Total
                                                                         Sales
                                ---------------------             ---------------------
                                  January 31,  February 1, % Over
     Geographic Area                 1999        1998     (Under)     1999       1998
  -----------------------         ----------  ---------  ---------  ---------   ---------
  North America (Excluding USA)$      23,035     22,574     2.0 %       27.4 %     22.9 %
  Europe                              14,787     22,811   (35.2)%       17.6 %     23.1 %
  Middle East                         25,071     23,452     6.9 %       29.9 %     23.7 %
  Far East & Asia                     15,296     23,951   (36.1)%       18.2 %     24.3 %
  South America                        2,793      3,487   (19.9)%        3.3 %      3.5 %
  All other areas                      3,003      2,483    20.9 %        3.6 %      2.5 %
                                  ----------  ---------  ---------  ---------   ---------
  
                               $      83,985     98,758   (15.0)%      100.0 %    100.0 %
                                  ==========  =========  =========  =========   =========
  
  </TABLE>
  
  International  sales,  and the  percentage of total sales,  for each of the last
  seven fiscal years  follows:  fiscal  1992-$37,913  (20%);  fiscal  1993-$41,471
  (21%); fiscal 1994-$44,038 (18%); fiscal 1995-$57,971 (19%); fiscal 1996-$77,397
  (22%);   fiscal   1997-$101,571   (25%);  and  fiscal   1998-$137,223   (29%)  .
  International  sales for the third quarter  represented 21.4% and 32.6% for 1999
  and 1998, respectively.  Year-to-date  international sales represented 23.9% and
  29.0% of total sales for 1999 and 1998, respectively.
  
  <PAGE>
  
                                     Culp, Inc.
                       SALES BY BUSINESS UNIT - TREND ANALYSIS
                                1997 vs 1998 vs 1999
                                      Unaudited
                               (Amounts in thousands)
  <TABLE>
  <CAPTION>
  
                                              Fiscal 1997                                      Fiscal 1998                    
                              ---------------------------------------------     ------------------------------------------    
   Product Category/Business     Q1       Q2       Q3       Q4     TOTAL          Q1      Q2       Q3       Q4     TOTAL      
             Units
  ----------------------------
  Upholstery Fabrics
  <S>                            <C>     <C>      <C>      <C>     <C>          <C>      <C>      <C>      <C>    <C>         
      Culp Decorative Fabrics    38,966  45,723   39,342   43,699  167,730      39,814   56,781   53,415   60,155 210,165     
      Culp Velvets/Prints        34,867  40,233   40,387   40,980  156,467      38,397   43,928   44,020   45,044 171,389     
                              ---------------------------------------------     ------------------------------------------    
                                 73,833  85,956   79,729   84,679  324,197      78,211  100,709   97,435  105,199 381,554     
  
  Mattress Ticking
      Culp Home Fashions         16,696  19,248   17,739   20,999   74,682      21,287   22,217   20,261   23,520  87,285     
  
  Yarn
      Culp Yarn                                                                                                               
                                      -       -        -        -        -           -        -      761    7,115   7,876     
                              ---------------------------------------------     ------------------------------------------    
  
                                 90,529 105,204   97,468  105,678  398,879      99,498  122,926  118,457  135,834 476,715     
                              =============================================     ==========================================    
  
  
                     Percent increase(decrease) from prior year:
  Product Category/Business Units
  ----------------------------------------------------------------------------------------------------------------------------
  Upholstery Fabrics
      Culp Decorative Fabrics      18.3    12.4      0.2     (4.4)     5.8         2.2     24.2     35.8     37.7    25.3     
      Culp Velvets/Prints          48.2    25.4     26.9      7.1     24.5        10.1      9.2      9.0      9.9     9.5     
                              ---------------------------------------------     ------------------------------------------    
                                   30.8    18.1     12.2      0.8     14.0         5.9     17.2     22.2     24.2    17.7     
  
  Mattress Ticking
      Culp Home Fashions            5.1     7.4     15.3     15.5     10.8        27.5     15.4     14.2     12.0    16.9     
  
  Yarn
      Culp Yarn                       -       -        -        -        -           -        -    100.0    100.0   100.0     
                              ---------------------------------------------     ------------------------------------------    
  
                                   25.1    16.0     12.7      3.4     13.4         9.9     16.8     21.5     28.5    19.5     
                              =============================================     ==========================================    
  
     Overall Growth Rate
  
  Internal (without acquisitions)  25.1    16.0     12.7      3.4     13.4         9.9      6.6      9.2     11.6     9.3     
  External                            -       -        -        -        -           -     10.2     12.3     16.9    10.2     
                              ---------------------------------------------     ------------------------------------------    
                                   25.1    16.0     12.7      3.4     13.4         9.9     16.8     21.5     28.5    19.5     
                              =============================================     ==========================================    
  </TABLE>
  
                   
  <PAGE>
                                     Culp, Inc.
                       SALES BY BUSINESS UNIT - TREND ANALYSIS
                                1997 vs 1998 vs 1999
                                      Unaudited
                               (Amounts in thousands)
  
  <TABLE>
  <CAPTION>
                                     
                                                  Fiscal 1999               
                                     --------------------------------------  
   Product Category/Business           Q1      Q2      Q3     Q4    TOTAL    
             Units                                                           
  ----------------------------                                               
  Upholstery Fabrics                                                         
  <S>                                 <C>     <C>    <C>           <C>       
      Culp Decorative Fabrics          51,445  59,573 50,520        161,538   
      Culp Velvets/Prints              29,994  38,728 34,949        103,671   
                                      --------------------------------------  
                                       81,439  98,301 85,469        265,209   
                                                                             
  Mattress Ticking                                                           
      Culp Home Fashions               22,632  23,491 22,536         68,659   
                                                                             
  Yarn                                                                       
      Culp Yarn                                                              
                                        6,596   6,367 4,088          17,051   
                                      --------------------------------------  
                                                                             
                                      110,667 128,159 112,093       350,919   
                                      ======================================  
                                                                             
                    Percent increase(decrease) from prior year:
  Product Category/Business Units                                                                       
  ----------------------------       -------------------------------------                                
  Upholstery Fabrics                                                      
      Culp Decorative Fabrics          29.2     4.9   (5.4)           7.7   
      Culp Velvets/Prints             (21.9)  (11.8) (20.6)         (17.9)   
                                    --------------------------------------  
                                        4.1    (2.4) (12.3)          (4.0)   
                                                                             
  Mattress Ticking                                                           
      Culp Home Fashions                6.3     5.7   11.2            7.7   
                                                                              
  Yarn                                                                       
      Culp Yarn                       100.0   100.0  437.2        2,140.6   
                                    --------------------------------------  
                                                                             
                                       11.2     4.3   (5.4)           2.9   
                                    ======================================  
                                                                             
     Overall Growth Rate                                                     
                                                                             
  Internal (without acquisitions)      (4.6)   (0.9)  (8.5)          (4.6)  
  External                             15.8     5.2    3.1            7.5   
                                     -------------------------------------   
                                       11.2     4.3   (5.4)           2.9                                          
                                    ======================================  
                                      
                                      
  </TABLE>
   <PAGE>
                                   
                              
                                                        (Page 8 of 10)
  
  
  
                     CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
  for the three and nine month periods ended January 31, 1999 and February 1, 1998
  
  
  INCOME STATEMENT COMMENTS
  
        GENERAL - Net sales  decreased 5.4% to $112.1  million,  and the company
  reported net income of $1.5 million  compared  with net income of $4.0 million
  for the third  quarter  of last  year.  Net sales for the  quarter,  excluding
  Artee  Industries,  decreased 8.5% versus the same quarter of last year. Artee
  Industries  was  acquired  at the  beginning  of the fourth  quarter of fiscal
  1998.  For the nine months ended  January 31, 1999,  the company  reported net
  income of  $206,000,  or $.02 per  share,  compared  with net  income of $11.4
  million, or $0.88 per share diluted, in the year-earlier period.
  
        The company continues to emphasize several key competitive strengths:
  
  Broad Product  Offering - marketing  one of the broadest  product lines in the
     upholstery  fabrics and mattress  ticking  industry.  Through its extensive
     manufacturing  capabilities,  the company  competes in every major category
     of the industry except leather;
  
  Diverse Global  Customer Base - penetrating  other end-use markets in addition
     to U. S. residential furniture, such as bedding, international,  commercial
     furniture  and  juvenile  furniture,  and avoiding  reliance  upon a single
     customer or small group of dominant  customers.  No one customer  accounted
     for more than 8% of net sales during the third quarter of fiscal 1999;
  
  Design  Innovation - investing  in the design of new  patterns  and  textures.
     The company's  state-of-the-art design center, which opened in January 1998
     in Burlington,  North  Carolina,  has enabled most of the company's  design
     resources to be  consolidated  into one facility which offers  advanced CAD
     systems for the design process;
  
  Vertical  Integration  - realizing  additional  manufacturing  integration  by
     utilizing  the  resources  now  controlled  for  producing the raw material
     components used in the manufacture of its products; and
  
  Ability to  Integrate  Acquisitions  -  investing  in  selective  acquisitions
     complementary to existing business units.
  
        NET SALES - Compared  with the third  quarter  of last year,  upholstery
  fabric  sales  decreased  12.3%  to  $85.5  million;  mattress  ticking  sales
  increased 11.2% to $22.5 million;  and yarn sales contributed $4.1 million for
  the  quarter  (See  Sales by  Business  Unit  schedule  on Page 5 and Sales by
  Business  Unit - Trend  Analysis  on Page 7).  International  sales  were down
  38.0% for the quarter.
  
        The  decline in sales of  upholstery  fabrics was due  principally  to a
  pronounced  slowdown in international  sales of wet and heat-transfer  printed
  flock  fabrics.  This trend,  which the  company  believes  has also  affected
  other manufacturers of upholstery fabrics,  became apparent after the close of
  fiscal  1998  and  has  been  persistent  thus  far in  fiscal  1999.  A large
  percentage  of the  company's  sales of this product  line were being  shipped
  directly or  indirectly  to customers  in the  emerging  markets of Russia and
  other  former  Soviet  countries  and Eastern  Europe.  All of these areas are
  generally  experiencing  very weak economic  conditions  which,  in turn, have
  affected  demand for  furniture  and other home  furnishings.  The company has
  significantly  curtailed  production  schedules  for  these  fabrics  and  has
  shifted its  marketing  focus for this product  category to  geographic  areas
  where  demand  is  more   favorable.   The  company  is  seeking  to  build  a
  diversified  geographic  base of  customers  internationally  to minimize  the
  exposure to economic uncertainties in any single geographic area.
  
  <PAGE>
  
  
                     CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
   for the three and nine month periods ended January 31, 1999 and February 1,
                                       1998
  
  
  
        The  increased  sales over the prior year by Culp Home  Fashions  during
  the third quarter  marked a  continuation  of the  longer-term  expansion that
  this  business  unit has  experienced.  Culp's  growth in these sales has been
  driven by the introduction of new designs and fabric  constructions as well as
  the advantages of the company's vertical  integration.  In particular,  Culp's
  ability to manufacture  the jacquard  greige,  or  unfinished,  goods that are
  then  printed to produce  mattress  ticking  has aided the  company in meeting
  faster delivery schedules and providing improved overall customer service.
  
        GROSS  PROFIT - Gross  profit  declined  8.2% for the  quarter  versus a
  year  ago.  The  decline  was due  principally  to lower  margins  at the Culp
  Decorative  Fabrics and Culp  Velvets/Prints  units.  Factors  contributing to
  reduced  profitability of Culp Decorative Fabrics include  lower-than-expected
  sales and competitive pressure on pricing,  especially in the jacquard product
  category.  The lower gross profit at Culp  Velvets/Prints was due to the sharp
  decline  in  international  sales of  printed  flock  fabrics.  Although  this
  business unit has taken  substantial  steps to reduce operating  expenses,  it
  continued  to  be  affected  by  excess   manufacturing   capacity  and  lower
  absorption of fixed costs during the third quarter.
  
        To  help  offset  the  pressure  on  gross  margins,   the  company  has
  instituted a number of actions. A major change involved a reorganization  from
  six to four  business  units  during  the first  quarter.  This new  corporate
  alignment grouped related  operations  together and was accompanied by several
  changes in  managerial  positions.  Steps  underway  to improve  profitability
  that are related to this  realignment  include a significant  reduction in the
  capacity for manufacturing  printed flock fabrics,  comprehensive  programs to
  reduce  inventories  and an intense  effort to reduce  operating  expenses and
  raise productivity.
  
        S,G&A  EXPENSES  -  S,G&A  expenses  for  the  third  quarter  rose as a
  percentage  of sales to 12.6%  from 11.1 % for the same  period of last  year.
  This  increase was due  principally  to the shortfall in sales from the volume
  that the  company had planned to  support.  The  increase in absolute  dollars
  from a year  ago  resulted  from the  Artee  acquisition,  increased  costs in
  sampling new product and higher costs for credit expenses.
  
        INTEREST  EXPENSE - Interest  expense  increased  5.9% compared with the
  year-earlier  quarter  due  to  higher  average  borrowings  outstanding.  The
  increased  borrowings  related  principally to the  acquisition  during fiscal
  1998  of  Artee   Industries  and  the   relatively   high  level  of  capital
  expenditures in fiscal 1998.
  
        OTHER EXPENSE  (INCOME),  NET - Other  expense  (income) of $492,000 was
  comparable with the year-earlier quarter.
  
        INCOME  TAXES - The  effective  tax  rate  for  the  quarter  was  32.9%
  compared  with 22.2% for the prior year.  The lower tax rate in the prior year
  resulted  from higher than  expected  tax  benefits  related to the  company's
  foreign sales corporation ("FSC").
  
        EBITDA - EBITDA for the quarter  decreased  to $9.5  million  from $11.4
  million  for last  year's  third  quarter  and  represented  8.5% of net sales
  compared with 9.6% of net sales for the same period of last year.
  
  
  
  
  <PAGE>
  
  
  
                     CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
   for the three and nine month periods ended January 31, 1999 and February 1,
                                       1998
  
  
  
  BALANCE SHEET COMMENTS
  
        WORKING CAPITAL - Accounts  receivable  decreased 13.7% from February 1,
  1998,   while  sales  decreased  5.4%  for  the  third  quarter.   Days  sales
  outstanding  represented  47 days,  down from 52 days at  February 1, 1998 and
  from 49 days at May 3, 1998.  Additionally,  the aging of accounts  receivable
  was 94.1%  current and less than 30 days past due versus  94.1% at February 1,
  1998.  Inventories  decreased 7.8 % from February 1, 1998, and inventory turns
  were 5.2 versus 5.4 for last year's third quarter.  The inventory  decrease is
  due to a decrease in upholstery fabric inventories.  Operating working capital
  (comprised of accounts  receivable,  inventory and accounts payable) decreased
  to $106.5 million at January 31, 1999, for the reasons  mentioned above,  from
  $112.2  million at  February  1, 1998.  The  balance at May 3, 1998 was $115.2
  million.
  
        PROPERTY,  PLANT AND  EQUIPMENT  - For  fiscal  1999,  the  company  has
  significantly  reduced its  planned  capital  spending  to $10-$15  million as
  compared with $35.9 million spent in fiscal 1998.  Culp is focused  instead on
  improving  the results of the  investments  made during fiscal 1997 and fiscal
  1998.  The two largest  projects that are  currently  underway for fiscal 1999
  are: (a)  completion of the  polypropylene  yarn  extrusion  expansion,  which
  began in early  fiscal  1998;  and (b)  building  expansions  in the Culp Home
  Fashions  business  unit to  accommodate  growth  in the  company's  sales  of
  mattress  ticking.  Depreciation for fiscal 1999 is currently  estimated to be
  approximately $19 million.
  
                  LONG-TERM DEBT - The company's  funded  debt-to-capital  ratio
  was 51.5% at January  31,  1999,  down from 53.7% at February 1, 1998 and from
  53.5% at May 3, 1998.  Funded  debt was $138.5  million at January  31,  1999,
  down from $141.2  million at  February 1, 1998 and from $151.6  million at May
  3, 1998.  (Funded debt equals long-term debt,  including  current  maturities,
  less restricted investments,  which represent unspent IRB funds). The decrease
  in funded debt from May 3, 1998  resulted  primarily  from an  operating  cash
  flow of $25.0 million,  offset by capital  expenditures  of $8.5 million and a
  decrease in accounts payable related to capital expenditures of $2.8 million.
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text: ------------------------------------------------------------------
  
                        SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C. 20549
  
                                     ---------
  
                                     Form 8-K
  
                                  CURRENT REPORT
  
                 Pursuant to Section 13 or 15(d) of the Securities
                               Exchange Act of 1934
  
                                   -------------
  
         Date of Report (Date of earliest event reported) February 17, 1999
  
                                     CULP, INC.
  
              (Exact name of registrant as specified in its charter)
  
          North Carolina                  0-12781                56-1001967
   (State or other jurisdiction    (Commission File No.)       (IRS Employer
         of incorporation)                                  Identification No.)
  
                               101 South Main Street
                         High Point, North Carolina  27260
                     (Address of principal executive offices)
                                  (336) 889-5161
               (Registrant's telephone number, including area code)
  
                                                                                
           (Former name or former address, if changed since last report)
  
  -------------------------------------------------------------------
  Item 5. Other Events
  
  See  attached  Press  Release (2 pages) and  Financial  Information  Release (10
  pages),  both dated February 17, 1999,  related to the fiscal 1999 third quarter
  ended January 31, 1999.
  
  Forward  Looking  Information.  This Report  contains  statements  that could be
  deemed   "forward-looking   statements"   within  the  meaning  of  the  federal
  securities   laws.  Such   statements  are  inherently   subject  to  risks  and
  uncertainties.   Forward-looking   statements   are   statements   that  include
  projections,   expectations  or  beliefs  about  future  events  or  results  or
  otherwise are not  statements  of historical  fact.  Such  statements  are often
  characterized  by  qualifying  words such as  "expect,"  "believe,"  "estimate,"
  "plan" and "project"  and their  derivatives.  Factors that could  influence the
  matters  discussed in such  statements  include the level of housing  starts and
  sales of existing homes,  consumer confidence,  trends in disposable income, and
  general  economic  conditions.  Decreases  in these  economic  indicators  could
  have a  negative  effect on the  Company's  business  and  prospects.  Likewise,
  increases in interest rates,  particularly  home mortgage  rates,  and increases
  in consumer  debt or the general  rate of  inflation,  could  affect the Company
  adversely.  Because  of  the  significant  percentage  of  the  Company's  sales
  derived by  international  shipments,  strengthening of the U. S. dollar against
  other  currencies  could make the  Company's  products less  competitive  on the
  basis of price in markets  outside  the United  States.  Additionally,  economic
  and political  instability  in  international  areas could affect the demand for
  the Company's products.
   
  
                                     SIGNATURE
  
  Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
  Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
  undersigned hereunto duly authorized.
  
   
                                      CULP, INC.
                                      (Registrant)
  
                                By:    Phillip W. Wilson                         
                                       Vice President and
                                       Chief Financial Officer
  
   
  
  Dated:   February 17, 1999
  FOR IMMEDIATE RELEASE
  
                        CULP REPORTS THIRD QUARTER EARNINGS
  
  HIGH  POINT,  N.C.  (Feb.  17,  1999) - Culp,  Inc.  (NYSE:CFI)  today  reported
  earnings for the third fiscal quarter ended January 31, 1999.
  
        For the three  months  ended  January 31,  1999,  Culp  reported  that net
  sales  amounted to $112.1  million  compared with $118.5 million a year ago. Net
  income for the quarter was $1.5 million,  or $0.12 per share  diluted,  compared
  with $4.0 million, or $0.31 per share diluted.
  
        Net sales for the first nine months totaled  $350.9 million  compared with
  $340.9  million  in the first  nine  months of fiscal  1998.  Net income for the
  first nine  months  amounted to  $206,000,  or $0.02 per share  diluted,  versus
  $11.4 million, or $0.88 per share diluted.
  
        "We are  continuing  to achieve  operational  progress  as a result of the
  organizational  restructuring  completed  earlier  this  year,"  said  Robert G.
  Culp,  III, chief executive  officer.  "The third fiscal quarter is historically
  not  the  strongest  period  of the  year  for  our  business  due  to  seasonal
  factors.  Although  net income for the third  quarter was lower than a year ago,
  the level of  profitability  did improve from the second period.  We believe the
  underlying  momentum  is  positive  in several  key  corporate  areas.  Customer
  service  has been  enhanced  as a result of the  decision to combine our various
  operations by major product  categories.  This alignment is  encouraging  closer
  working  relationships  with  accounts and  assisting us in the vital process of
  creating  new  fabric  designs  and  textures.  Our  intent  is to  link  design
  resources with  manufacturing  capabilities  in order to provide the marketplace
  with innovative  designs that offer  compelling  value for furniture and bedding
  manufacturers."
  
        Culp added,  "As we have  indicated,  we believe the impact of the changes
  that have been  implemented  will  continue  into fiscal 2000.  We are confident
  about the fundamental  growth  opportunities  for Culp both in the United States
  and  internationally  and are encouraged by the continuing  favorable  trends in
  measures  such as consumer  confidence,  employment  levels and  mortgage  rates
  that have an important influence on consumer spending on home furnishings."
  
        Culp,   Inc.  is  the  world's  largest   manufacturer   and  marketer  of
  upholstery  fabrics for furniture and is a leading  producer of mattress ticking
  for bedding.  The  Company's  fabrics are used  primarily in the  production  of
  residential and commercial furniture and bedding products.
  CULP, INC.
                           Condensed Financial Highlights
                                    (Unaudited)
                                                       Three Months Ended     
                                                  January 31,       February 1,
                                                     1999             1998    
  Net sales                                      $112,093,000      $118,457,000
  Net income                                        1,539,000         4,002,000
  Net income per share
    Basic                                        $       0.12      $       0.32
    Diluted                                      $       0.12      $       0.31
  Average shares outstanding
    Basic                                          12,995,000        12,692,000
    Diluted                                        13,124,000        12,986,000
  
                                                        Nine Months Ended       
                                                  January 31,       February 1,
                                                     1999              1998   
  Net sales                                      $350,919,000      $340,881,000
  Net income                                          206,000        11,357,000
  Net income per share
    Basic                                        $       0.02      $       0.90
    Diluted                                      $       0.02      $       0.88
  Average shares outstanding
    Basic                                          12,997,000        12,663,000
    Diluted                                        13,171,000        12,964,000
  
  This  release  contains   statements  that  could  be  deemed   "forward-looking
  statements,"   within  the  meaning  of  the  federal   securities   laws.  Such
  statements are inherently  subject to risks and  uncertainties.  Forward-looking
  statements  are statements  that include  projections,  expectations  or beliefs
  about future  events or results or otherwise  are not  statements  of historical
  fact.  Such  statements  are often  characterized  by  qualifying  words such as
  "expect,"  "believe,"  "estimate,"  "plan" and "project" and their  derivatives.
  Factors that could influence the matters  discussed in such  statements  include
  the level of housing starts and sales of existing  homes,  consumer  confidence,
  trends in  disposable  income and  general  economic  conditions.  Decreases  in
  these  economic  indicators  could  have a  negative  effect  on  the  company's
  business and  prospects.  Likewise,  increases in interest  rates,  particularly
  home  mortgage  rates,  and  increases  in consumer  debt or the general rate of
  inflation,  could  affect the  company  adversely.  Because  of the  significant
  percentage  of  the  company's   sales  derived  by   international   shipments,
  strengthening  of the  U.S.  dollar  against  other  currencies  could  make the
  company's  products less  competitive  on the basis of price in markets  outside
  the  United  States.   Additionally,   economic  and  political  instability  in
  international areas could affect the demand for the company's products.
                                        -END-
  CULP, INC. FINANCIAL INFORMATION RELEASE
                          CONSOLIDATED STATEMENTS OF INCOME
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
  (Amounts in Thousands, Except for Per Share Data)
  
                                                    THREE MONTHS ENDED (UNAUDITED)
                                      -----------------------------------------------------------
                                             Amounts                             Percent of Sales
                                      ----------------------                    --------------------
                                      January 31, February 1,  % Over
                                       1999        1998         (Under)           1999      1998
                                      ----------  ----------  --------------    ---------  ---------
  Net sales                     $       112,093     118,457     (5.4)%           100.0 %   100.0 %
  Cost of sales                          92,911      97,554     (4.8)%            82.9 %    82.4 %
                                      ----------  ----------  --------------    ---------  ---------
        Gross profit                     19,182      20,903     (8.2)%            17.1 %    17.6 %
  
  Selling, general and
    administrative expenses              14,100      13,162      7.1 %            12.6 %    11.1 %
                                      ----------  ----------  --------------    ---------  ---------
        Income from operations            5,082       7,741    (34.3)%             4.5 %     6.5 %
  
  Interest expense                        2,308       2,180      5.9 %             2.1 %     1.8 %
  Interest income                           (10)        (73)   (86.3)%            (0.0)%    (0.1)%
  Other expense (income), net               492         492      0.0 %             0.4 %     0.4 %
                                      ----------  ----------  --------------    ---------  ---------
        Income before income taxes        2,292       5,142    (55.4)%             2.0 %     4.3 %
      
  Income taxes  *                           753       1,140    (33.9)%            32.9 %    22.2 %
                                      ----------  ----------  --------------    ---------  ---------
        Net income              $         1,539       4,002    (61.5)%             1.4 %     3.4 %
                                      ==========  ==========  ==============    =========  =========
  
  Net income per share                    $0.12       $0.32    (62.5)%
  Net income per share, assuming dilution $0.12       $0.31    (61.3)%
  Dividends per share                    $0.035      $0.035      0.0 %
  Average shares outstanding             12,995      12,692      2.4 %
  Average shares outstanding,            
   assuming dilution                     13,124      12,986      1.1 %
  
                                                    NINE MONTHS ENDED (UNAUDITED)
                                      -----------------------------------------------------------
  
                                             Amounts                             Percent of Sales
                                      ----------------------                    --------------------
                                      January 31,  February 1,   % Over
                                         1999        1998         (Under)         1999      1998
                                      ----------  ----------  --------------    ---------  ---------
  
  Net sales                     $       350,919     340,881      2.9 %           100.0 %   100.0 %
  Cost of sales                         297,652     280,510      6.1 %            84.8 %    82.3 %
                                      ----------  ----------  --------------    ---------  ---------
        Gross profit                     53,267      60,371    (11.8)%            15.2 %    17.7 %
  
  Selling, general and
    administrative expenses              44,047      37,710     16.8 %            12.6 %    11.1 %
                                      ----------  ----------  --------------    ---------  ---------
        Income from operations            9,220      22,661    (59.3)%             2.6 %     6.6 %
  
  Interest expense                        7,133       5,280     35.1 %             2.0 %     1.5 %
  Interest income                           (82)       (235)   (65.1)%            (0.0)%    (0.1)%
  Other expense (income), net             1,866       1,159     61.0 %             0.5 %     0.3 %
                                      ----------  ----------  --------------    ---------  ---------
        Income before income  taxes         303      16,457    (98.2)%             0.1 %     4.8 %
       
  Income taxes  *                            97       5,100    (98.1)%            32.0 %    31.0 %
                                      ----------  ----------  --------------    ---------  ---------
         Net income              $          206      11,357    (98.2)%             0.1 %     3.3 %
                                      ==========  ==========  ==============    =========  =========
  
  Net income per share                    $0.02       $0.90    (97.8)%
  Net income per share,assuming dilution  $0.02       $0.88    (97.7)%
  
  Dividends per share                    $0.105      $0.105      0.0 %
  Average shares outstanding             12,997      12,663      2.6 %
  Average shares outstanding,            
  assuming dilution                      13,171      12,964      1.6 %
  * Percent of sales column is calculated as a % of
  income before income taxes.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                                  CONSOLIDATED BALANCE SHEETS
                      JANUARY 31, 1999, FEBRUARY 1, 1998 AND MAY 3, 1998
                                           Unaudited
  (Amounts in Thousands)
  
                                             Amounts                 
                                    ---------------------------        Increase
                                    January 31,    February 1,        (Decrease)         *  
                                                              ----------------------   May 3,
                                        1999         1998       Dollars     Percent     1998
                                    -------------  ----------  ----------   ---------  -------
  Current assets
  Cash and cash  investments $          655         348         307      88.2 %     2,312
       Accounts receivable                63,090      73,109     (10,019)    (13.7)%    73,773
       Inventories                        69,210      75,032      (5,822)     (7.8)%    78,594
       Other current assets                7,560       7,202         358       5.0 %     7,808
                                    -------------  ----------  ----------   ---------   -------
               Total current  assets     140,515     155,691     (15,176)     (9.7)%   162,487
             
  Restricted investments                   3,416       3,976        (560)    (14.1)%     4,021
  Property, plant & equipment, net       125,885     113,658      12,227      10.8 %   128,805
  Goodwill                                51,615      48,558       3,057       6.3 %    55,162
  Other assets                             5,017       5,439        (422)     (7.8)%     4,340
                                    -------------  ----------  ----------   ---------   -------
                                                                             
               Total assets       $      326,448     327,322       (874)     (0.3) %   354,815
                                    =============  ==========  ==========   =========   =======
  
                                                                             
                                                                             
  Current liabilities
       Current maturities of      
        long-term debt            $        1,678       1,120         558      49.8 %     3,325
       Accounts payable                   25,808      35,921     (10,113)    (28.2)%    37,214
       Accrued expenses                   17,317      12,683       4,634      36.5 %    17,936
       Income taxes payable                    0       1,941      (1,941)   (100.0)%     1,282
                                    -------------  ----------  ----------   ---------   -------
            Total current liabilities     44,803      51,665      (6,862)    (13.3)%    59,757
               
  Long-term debt                         140,210     144,079      (3,869)     (2.7)%   152,312
   
  Deferred income taxes                   11,227       9,965       1,262      12.7 %    11,227
                                    -------------  ----------  ----------   ---------  -------
            Total liabilities            196,240     205,709      (9,469)     (4.6)%   223,296
              
  Shareholders'equity                    130,208     121,613       8,595       7.1 %   131,519
                                    -------------  ----------  ----------   ---------  -------
                                                                             
            Total liabilities and                                                        
            shareholders' equity  $      326,448     327,322       (874)      (0.3)%   354,815
                                    =============  ==========  ==========   =========  =======
                                                                             
  Shares outstanding                      12,995      12,700         295       2.3 %    13,007
                                    =============  ==========  ==========   =========  =======
  *  Derived from audited financial statements.
  CULP, INC.
                            FINANCIAL INFORMATION RELEASE
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
           FOR THE NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
                                      Unaudited
                               (Amounts in Thousands)
  NINE MONTHS ENDED
                                                            ------------------------
                                                                     Amounts
                                                            ----------------------
                                                          January 31,  February 1,
                                                              1999       1998
                                                           ----------- ----------
  Cash flows from operating activities:
  Net income                                          $        206     11,357
      Adjustments to reconcile net income to net cash
        provided by (used in) operating activities:
           Depreciation                                         13,785     10,660
           Amortization of intangible assets                     1,174        883
           Changes in assets and liabilities:
             Accounts receivable                                10,546    (16,418)
             Inventories                                         9,984    (16,330)
             Other current assets                                  303     (1,752)
             Other assets                                          (95)    (1,942)
             Accounts payable                                   (8,609)     8,783
             Accrued expenses                                     (973)    (2,175)
             Income taxes payable                               (1,282)       361
                                                             ----------- ---------
                Net cash provided by (used in) operating         
                 activities                                     25,039     (6,573)
                                                             ----------- ---------
  Cash flows from investing activities:                                    
      Capital expenditures                                      (8,500)   (28,183)
      Purchases of restricted investments                          (73)    (8,724)
      Purchase of investments to fund deferred                    
       compensation liability                                     (735)      (581)
      Sale of restricted investments                               678     15,766
      Businesses acquired                                            0    (37,156)
                                                             ----------- ---------
                Net cash used in investing activities           (8,630)   (58,878)
                                                             ----------- ---------
  Cash flows from financing activities:                                    
      Proceeds from issuance of long-term debt                   2,535     77,600
      Principal payments on long-term debt                     (16,284)    (9,042)
      Change in accounts payable-capital expenditures           (2,800)    (2,765)
      Dividends paid                                            (1,365)    (1,333)
      Common stock issued (purchased)                             (152)       509
                                                             ----------- --------
                Net cash provided by (used in) financing        
                 activities                                    (18,066)    64,969
                                                             ----------- ---------
  Decrease in cash and cash investments                         (1,657)      (482)
                                                                          
  Cash and cash investments at beginning of period               2,312        830
                                                             ----------- ---------
                                                                           
  Cash and cash investments at end of period               $       655        348
                                                             =========== =========
  CULP, INC. FINANCIAL INFORMATION RELEASE
                                     FINANCIAL ANALYSIS
                                      JANUARY 31, 1999
  FISCAL 98                 FISCAL 99
                                           --------  ---------------------------------------   ---------
                                             Q3         Q1        Q2        Q3        Q4         LTM
                                           --------  ---------------------------------------   ---------
  
  INVENTORIES
  Inventory turns                       5.4         4.9       5.7       5.2
  
  RECEIVABLES
        Days sales in receivables              52          48        52        47
        Percent current &
         less than 30 days past due          94.1%       93.8%     94.9%     94.1%
              
  WORKING CAPITAL
        Current ratio                         3.0         3.1       3.0       3.1
        Working capital turnover (4)          4.7         4.5       4.4       4.4
        Operating working capital (4)      $112,220   $111,481  $112,750  $106,492
        
  PROPERTY, PLANT & EQUIPMENT
        Depreciation rate                     7.4%        7.7%      8.4%      7.9%
        Percent property, plant &
         equipment are depreciated           44.8%       43.8%     45.0%     46.1%
        Capital expenditures               $35,879 (1)  $2,858    $3,585    $2,057
        
  
  PROFITABILITY
        Return on average total capital       8.3%      (1.6%)      4.2%      4.5%                 3.8%
        Return on average equity             13.4%      (8.1%)      4.1%      4.7%                 3.4%
        Net income (loss) per share          $0.32     ($0.20)     $0.10     $0.12                $0.34
        Net income (loss) per   
         share (diluted)                     $0.31     ($0.20)     $0.10     $0.12                $0.33
  
  LEVERAGE (3)
        Total liabilities/equity            169.2%      167.2%    164.9%    150.7%
        Funded debt/equity                  116.1%      119.7%    115.0%    106.3%
        Funded debt/capital employed         53.7%       54.5%     53.5%     51.5%
        Funded debt                       $141,223    $153,559  $148,479  $138,472
        Funded debt/EBITDA (LTM) (6)          2.95        3.75      3.95      3.91
        EBITDA/Interest                        
         expense, net (LTM)                    7.5      4.9       4.2       3.9
    
  OTHER
        Book value per share               $9.58       $9.87     $9.94    $10.02
        Employees at quarter end           3,771       4,230     4,014     3,949
        Sales per employee (annualized) $129,000    $103,000  $124,000  $113,000
        Capital employed (3)            $262,836    $281,831  $277,603  $268,680
        Effective income tax rate          22.2%       33.0%     33.0%     32.9%
        EBITDA  (2)                      $11,390      $3,142    $9,649    $9,522                $34,109
        EBITDA/net sales                    9.6%        2.8%      7.5%      8.5%                   7.0%
  (1) Expenditures for entire year
    (2) Earnings before interest, income taxes, and depreciation & amortization.
    (3) Long-term debt, funded debt and capital employed are all net of restricted
        investments.
    (4) Working capital for this calculation is accounts receivable, inventories 
        and accounts payable.
    (5) LTM represents "Latest Twelve Months"
    (6) EBITDA includes capitalized interest and pro forma amounts for 
        acquisitions.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                     SALES BY PRODUCT CATEGORY/BUSINESS UNIT
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
                               (Amounts in thousands)
  THREE MONTHS ENDED (UNAUDITED)
                             ---------------------------------------------------
                                  Amounts                      Percent of Total
                                                                    Sales
                             ------------------               -------------------
                             January 31, February 1, % Over
  Product                        1999      1998      (Under)      1999      1998
  Category/Business Unit
  -------------------------   ---------  ---------  ----------  --------  --------
  Upholstery Fabrics
      Culp Decorative Fabrics $  50,520    53,415    (5.4)%     45.1 %     45.1 %
      Culp Velvets/Prints        34,949    44,020   (20.6)%     31.2 %     37.2 %
                               --------  --------  ----------  --------  ---------
                                 85,469    97,435   (12.3)%     76.2 %     82.3 %
  
  Mattress Ticking
      Culp Home Fashions         22,536    20,261    11.2 %     20.1 %     17.1 %
  
  Yarn
     Culp Yarn                    4,088       761   437.2 %      3.6 %      0.6 %
                               --------  --------  ----------  --------  ---------
  
                            * $ 112,093   118,457    (5.4)%     100.0%    100.0 %
                               ========  ========  ==========  ========  =========
  
                                       NINE MONTHS ENDED (UNAUDITED)
                             ---------------------------------------------------
  
                                  Amounts                      Percent of Total
                                                                    Sales
                             ------------------               -------------------
                            January 31, February 1,   % Over
  Product                       1999      1998      (Under)      1999      1998
  Category/Business Unit
  -------------------------  ---------  ---------  ----------  --------  ---------
  Upholstery Fabrics
      Culp Decorative Fabrics $ 161,538   150,010       7.7 %     46.0 %     44.0 %
  
      Culp Velvets/Prints       103,671   126,345     (17.9)%     29.5 %     37.1 %
                               --------  --------   ----------  --------  ---------
                                265,209   276,355      (4.0)%     75.6 %     81.1 %
  
  Mattress Ticking
      Culp Home Fashions         68,659    63,765       7.7 %     19.6 %     18.7 %
  
  Yarn
     Culp Yarn                   17,051       761   2,140.6 %      4.9 %      0.2 %
                               --------  --------   ----------  --------  ---------
  
                            * $ 350,919   340,881       2.9 %     100.0%    100.0 %
                               ========  ========   ==========  ========  =========
  * U.S.  sales were $88,152 and $79,873 for the third  quarter of fiscal 1999 and
  fiscal  1998,  respectively;  and  $266,934  and $242,123 for the nine months of
  fiscal 1999 and fiscal 1998, respectively. The percentage increase in U.S. sales
  was 10.4% for the third quarter and an increase of 10.2% for the nine months.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                       INTERNATIONAL SALES BY GEOGRAPHIC AREA
  FOR THE THREE MONTHS AND NINE MONTHS ENDED JANUARY 31, 1999 AND FEBRUARY 1, 1998
  
                               (Amounts in thousands)
  THREE MONTHS ENDED (UNAUDITED)
                             -------------------------------------------------------
  
                                           Amounts                        Percent of Total
                                                                                Sales
                                      ---------------------               ---------------------
                                      January 31,  February 1,  % Over
     Geographic Area                    1999        1998       (Under)      1999       1998
  -----------------------            -----------  ----------  ---------   ---------   ---------
  North America (Excluding USA) $       7,280      7,562         (3.7)%       30.4 %     19.6 %
  Europe                                3,881     11,581        (66.5)%       16.2 %     30.0 %
  Middle East                           6,711      9,326        (28.0)%       28.0 %     24.2 %
  Far East & Asia                       4,993      7,957        (37.3)%       20.9 %     20.6 %
  South America                           555      1,230        (54.9)%        2.3 %      3.2 %
  All other areas                         521        928        (43.9)%        2.2 %      2.4 %
                                   ----------  ---------      ---------    ---------   ---------
  
                                $      23,941     38,584        (38.0)%      100.0 %    100.0 %
                                   ==========  =========        =========  =========   =========
  
                                         NINE MONTHS ENDED (UNAUDITED)
                             -------------------------------------------------------
                                      Amounts                       Percent of Total
                                                                         Sales
                                ---------------------             ---------------------
                                  January 31,  February 1, % Over
     Geographic Area                 1999        1998     (Under)     1999       1998
  -----------------------         ----------  ---------  ---------  ---------   ---------
  North America (Excluding USA)$      23,035     22,574     2.0 %       27.4 %     22.9 %
  Europe                              14,787     22,811   (35.2)%       17.6 %     23.1 %
  Middle East                         25,071     23,452     6.9 %       29.9 %     23.7 %
  Far East & Asia                     15,296     23,951   (36.1)%       18.2 %     24.3 %
  South America                        2,793      3,487   (19.9)%        3.3 %      3.5 %
  All other areas                      3,003      2,483    20.9 %        3.6 %      2.5 %
                                  ----------  ---------  ---------  ---------   ---------
  
                               $      83,985     98,758   (15.0)%      100.0 %    100.0 %
                                  ==========  =========  =========  =========   =========
  International  sales,  and the  percentage of total sales,  for each of the last
  seven fiscal years  follows:  fiscal  1992-$37,913  (20%);  fiscal  1993-$41,471
  (21%); fiscal 1994-$44,038 (18%); fiscal 1995-$57,971 (19%); fiscal 1996-$77,397
  (22%);   fiscal   1997-$101,571   (25%);  and  fiscal   1998-$137,223   (29%)  .
  International  sales for the third quarter  represented 21.4% and 32.6% for 1999
  and 1998, respectively.  Year-to-date  international sales represented 23.9% and
  29.0% of total sales for 1999 and 1998, respectively.
  Culp, Inc.
                       SALES BY BUSINESS UNIT - TREND ANALYSIS
                                1997 vs 1998 vs 1999
                                      Unaudited
                               (Amounts in thousands)
  Fiscal 1997                                      Fiscal 1998                    
                              ---------------------------------------------     ------------------------------------------    
   Product Category/Business     Q1       Q2       Q3       Q4     TOTAL          Q1      Q2       Q3       Q4     TOTAL      
             Units
  ----------------------------
  Upholstery Fabrics
  Culp Decorative Fabrics    38,966  45,723   39,342   43,699  167,730      39,814   56,781   53,415   60,155 210,165     
      Culp Velvets/Prints        34,867  40,233   40,387   40,980  156,467      38,397   43,928   44,020   45,044 171,389     
                              ---------------------------------------------     ------------------------------------------    
                                 73,833  85,956   79,729   84,679  324,197      78,211  100,709   97,435  105,199 381,554     
  
  Mattress Ticking
      Culp Home Fashions         16,696  19,248   17,739   20,999   74,682      21,287   22,217   20,261   23,520  87,285     
  
  Yarn
      Culp Yarn                                                                                                               
                                      -       -        -        -        -           -        -      761    7,115   7,876     
                              ---------------------------------------------     ------------------------------------------    
  
                                 90,529 105,204   97,468  105,678  398,879      99,498  122,926  118,457  135,834 476,715     
                              =============================================     ==========================================    
  
                     Percent increase(decrease) from prior year:
  Product Category/Business Units
  ----------------------------------------------------------------------------------------------------------------------------
  Upholstery Fabrics
      Culp Decorative Fabrics      18.3    12.4      0.2     (4.4)     5.8         2.2     24.2     35.8     37.7    25.3     
      Culp Velvets/Prints          48.2    25.4     26.9      7.1     24.5        10.1      9.2      9.0      9.9     9.5     
                              ---------------------------------------------     ------------------------------------------    
                                   30.8    18.1     12.2      0.8     14.0         5.9     17.2     22.2     24.2    17.7     
  
  Mattress Ticking
      Culp Home Fashions            5.1     7.4     15.3     15.5     10.8        27.5     15.4     14.2     12.0    16.9     
  
  Yarn
      Culp Yarn                       -       -        -        -        -           -        -    100.0    100.0   100.0     
                              ---------------------------------------------     ------------------------------------------    
  
                                   25.1    16.0     12.7      3.4     13.4         9.9     16.8     21.5     28.5    19.5     
                              =============================================     ==========================================    
  
     Overall Growth Rate
  
  Internal (without acquisitions)  25.1    16.0     12.7      3.4     13.4         9.9      6.6      9.2     11.6     9.3     
  External                            -       -        -        -        -           -     10.2     12.3     16.9    10.2     
                              ---------------------------------------------     ------------------------------------------    
                                   25.1    16.0     12.7      3.4     13.4         9.9     16.8     21.5     28.5    19.5     
                              =============================================     ==========================================
  Culp, Inc.
                       SALES BY BUSINESS UNIT - TREND ANALYSIS
                                1997 vs 1998 vs 1999
                                      Unaudited
                               (Amounts in thousands)
  Fiscal 1999               
                                     --------------------------------------  
   Product Category/Business           Q1      Q2      Q3     Q4    TOTAL    
             Units                                                           
  ----------------------------                                               
  Upholstery Fabrics
  Culp Decorative Fabrics          51,445  59,573 50,520        161,538   
      Culp Velvets/Prints              29,994  38,728 34,949        103,671   
                                      --------------------------------------  
                                       81,439  98,301 85,469        265,209   
                                                                             
  Mattress Ticking                                                           
      Culp Home Fashions               22,632  23,491 22,536         68,659   
                                                                             
  Yarn                                                                       
      Culp Yarn                                                              
                                        6,596   6,367 4,088          17,051   
                                      --------------------------------------  
                                                                             
                                      110,667 128,159 112,093       350,919   
                                      ======================================  
                                                                             
                    Percent increase(decrease) from prior year:
  Product Category/Business Units                                                                       
  ----------------------------       -------------------------------------                                
  Upholstery Fabrics                                                      
      Culp Decorative Fabrics          29.2     4.9   (5.4)           7.7   
      Culp Velvets/Prints             (21.9)  (11.8) (20.6)         (17.9)   
                                    --------------------------------------  
                                        4.1    (2.4) (12.3)          (4.0)   
                                                                             
  Mattress Ticking                                                           
      Culp Home Fashions                6.3     5.7   11.2            7.7   
                                                                              
  Yarn                                                                       
      Culp Yarn                       100.0   100.0  437.2        2,140.6   
                                    --------------------------------------  
                                                                             
                                       11.2     4.3   (5.4)           2.9   
                                    ======================================  
                                                                             
     Overall Growth Rate                                                     
                                                                             
  Internal (without acquisitions)      (4.6)   (0.9)  (8.5)          (4.6)  
  External                             15.8     5.2    3.1            7.5   
                                     -------------------------------------   
                                       11.2     4.3   (5.4)           2.9                                          
                                    ======================================
  (Page 8 of 10)
  
                     CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
  for the three and nine month periods ended January 31, 1999 and February 1, 1998
  
  INCOME STATEMENT COMMENTS
  
        GENERAL - Net sales  decreased 5.4% to $112.1  million,  and the company
  reported net income of $1.5 million  compared  with net income of $4.0 million
  for the third  quarter  of last  year.  Net sales for the  quarter,  excluding
  Artee  Industries,  decreased 8.5% versus the same quarter of last year. Artee
  Industries  was  acquired  at the  beginning  of the fourth  quarter of fiscal
  1998.  For the nine months ended  January 31, 1999,  the company  reported net
  income of  $206,000,  or $.02 per  share,  compared  with net  income of $11.4
  million, or $0.88 per share diluted, in the year-earlier period.
  
        The company continues to emphasize several key competitive strengths:
  
  Broad Product  Offering - marketing  one of the broadest  product lines in the
     upholstery  fabrics and mattress  ticking  industry.  Through its extensive
     manufacturing  capabilities,  the company  competes in every major category
     of the industry except leather;
  
  Diverse Global  Customer Base - penetrating  other end-use markets in addition
     to U. S. residential furniture, such as bedding, international,  commercial
     furniture  and  juvenile  furniture,  and avoiding  reliance  upon a single
     customer or small group of dominant  customers.  No one customer  accounted
     for more than 8% of net sales during the third quarter of fiscal 1999;
  
  Design  Innovation - investing  in the design of new  patterns  and  textures.
     The company's  state-of-the-art design center, which opened in January 1998
     in Burlington,  North  Carolina,  has enabled most of the company's  design
     resources to be  consolidated  into one facility which offers  advanced CAD
     systems for the design process;
  
  Vertical  Integration  - realizing  additional  manufacturing  integration  by
     utilizing  the  resources  now  controlled  for  producing the raw material
     components used in the manufacture of its products; and
  
  Ability to  Integrate  Acquisitions  -  investing  in  selective  acquisitions
     complementary to existing business units.
  
        NET SALES - Compared  with the third  quarter  of last year,  upholstery
  fabric  sales  decreased  12.3%  to  $85.5  million;  mattress  ticking  sales
  increased 11.2% to $22.5 million;  and yarn sales contributed $4.1 million for
  the  quarter  (See  Sales by  Business  Unit  schedule  on Page 5 and Sales by
  Business  Unit - Trend  Analysis  on Page 7).  International  sales  were down
  38.0% for the quarter.
  
        The  decline in sales of  upholstery  fabrics was due  principally  to a
  pronounced  slowdown in international  sales of wet and heat-transfer  printed
  flock  fabrics.  This trend,  which the  company  believes  has also  affected
  other manufacturers of upholstery fabrics,  became apparent after the close of
  fiscal  1998  and  has  been  persistent  thus  far in  fiscal  1999.  A large
  percentage  of the  company's  sales of this product  line were being  shipped
  directly or  indirectly  to customers  in the  emerging  markets of Russia and
  other  former  Soviet  countries  and Eastern  Europe.  All of these areas are
  generally  experiencing  very weak economic  conditions  which,  in turn, have
  affected  demand for  furniture  and other home  furnishings.  The company has
  significantly  curtailed  production  schedules  for  these  fabrics  and  has
  shifted its  marketing  focus for this product  category to  geographic  areas
  where  demand  is  more   favorable.   The  company  is  seeking  to  build  a
  diversified  geographic  base of  customers  internationally  to minimize  the
  exposure to economic uncertainties in any single geographic area.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
   for the three and nine month periods ended January 31, 1999 and February 1,
                                       1998
  
        The  increased  sales over the prior year by Culp Home  Fashions  during
  the third quarter  marked a  continuation  of the  longer-term  expansion that
  this  business  unit has  experienced.  Culp's  growth in these sales has been
  driven by the introduction of new designs and fabric  constructions as well as
  the advantages of the company's vertical  integration.  In particular,  Culp's
  ability to manufacture  the jacquard  greige,  or  unfinished,  goods that are
  then  printed to produce  mattress  ticking  has aided the  company in meeting
  faster delivery schedules and providing improved overall customer service.
  
        GROSS  PROFIT - Gross  profit  declined  8.2% for the  quarter  versus a
  year  ago.  The  decline  was due  principally  to lower  margins  at the Culp
  Decorative  Fabrics and Culp  Velvets/Prints  units.  Factors  contributing to
  reduced  profitability of Culp Decorative Fabrics include  lower-than-expected
  sales and competitive pressure on pricing,  especially in the jacquard product
  category.  The lower gross profit at Culp  Velvets/Prints was due to the sharp
  decline  in  international  sales of  printed  flock  fabrics.  Although  this
  business unit has taken  substantial  steps to reduce operating  expenses,  it
  continued  to  be  affected  by  excess   manufacturing   capacity  and  lower
  absorption of fixed costs during the third quarter.
  
        To  help  offset  the  pressure  on  gross  margins,   the  company  has
  instituted a number of actions. A major change involved a reorganization  from
  six to four  business  units  during  the first  quarter.  This new  corporate
  alignment grouped related  operations  together and was accompanied by several
  changes in  managerial  positions.  Steps  underway  to improve  profitability
  that are related to this  realignment  include a significant  reduction in the
  capacity for manufacturing  printed flock fabrics,  comprehensive  programs to
  reduce  inventories  and an intense  effort to reduce  operating  expenses and
  raise productivity.
  
        S,G&A  EXPENSES  -  S,G&A  expenses  for  the  third  quarter  rose as a
  percentage  of sales to 12.6%  from 11.1 % for the same  period of last  year.
  This  increase was due  principally  to the shortfall in sales from the volume
  that the  company had planned to  support.  The  increase in absolute  dollars
  from a year  ago  resulted  from the  Artee  acquisition,  increased  costs in
  sampling new product and higher costs for credit expenses.
  
        INTEREST  EXPENSE - Interest  expense  increased  5.9% compared with the
  year-earlier  quarter  due  to  higher  average  borrowings  outstanding.  The
  increased  borrowings  related  principally to the  acquisition  during fiscal
  1998  of  Artee   Industries  and  the   relatively   high  level  of  capital
  expenditures in fiscal 1998.
  
        OTHER EXPENSE  (INCOME),  NET - Other  expense  (income) of $492,000 was
  comparable with the year-earlier quarter.
  
        INCOME  TAXES - The  effective  tax  rate  for  the  quarter  was  32.9%
  compared  with 22.2% for the prior year.  The lower tax rate in the prior year
  resulted  from higher than  expected  tax  benefits  related to the  company's
  foreign sales corporation ("FSC").
  
        EBITDA - EBITDA for the quarter  decreased  to $9.5  million  from $11.4
  million  for last  year's  third  quarter  and  represented  8.5% of net sales
  compared with 9.6% of net sales for the same period of last year.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                               FINANCIAL NARRATIVE
   for the three and nine month periods ended January 31, 1999 and February 1,
                                       1998
  
  BALANCE SHEET COMMENTS
  
        WORKING CAPITAL - Accounts  receivable  decreased 13.7% from February 1,
  1998,   while  sales  decreased  5.4%  for  the  third  quarter.   Days  sales
  outstanding  represented  47 days,  down from 52 days at  February 1, 1998 and
  from 49 days at May 3, 1998.  Additionally,  the aging of accounts  receivable
  was 94.1%  current and less than 30 days past due versus  94.1% at February 1,
  1998.  Inventories  decreased 7.8 % from February 1, 1998, and inventory turns
  were 5.2 versus 5.4 for last year's third quarter.  The inventory  decrease is
  due to a decrease in upholstery fabric inventories.  Operating working capital
  (comprised of accounts  receivable,  inventory and accounts payable) decreased
  to $106.5 million at January 31, 1999, for the reasons  mentioned above,  from
  $112.2  million at  February  1, 1998.  The  balance at May 3, 1998 was $115.2
  million.
  
        PROPERTY,  PLANT AND  EQUIPMENT  - For  fiscal  1999,  the  company  has
  significantly  reduced its  planned  capital  spending  to $10-$15  million as
  compared with $35.9 million spent in fiscal 1998.  Culp is focused  instead on
  improving  the results of the  investments  made during fiscal 1997 and fiscal
  1998.  The two largest  projects that are  currently  underway for fiscal 1999
  are: (a)  completion of the  polypropylene  yarn  extrusion  expansion,  which
  began in early  fiscal  1998;  and (b)  building  expansions  in the Culp Home
  Fashions  business  unit to  accommodate  growth  in the  company's  sales  of
  mattress  ticking.  Depreciation for fiscal 1999 is currently  estimated to be
  approximately $19 million.
  
                  LONG-TERM DEBT - The company's  funded  debt-to-capital  ratio
  was 51.5% at January  31,  1999,  down from 53.7% at February 1, 1998 and from
  53.5% at May 3, 1998.  Funded  debt was $138.5  million at January  31,  1999,
  down from $141.2  million at  February 1, 1998 and from $151.6  million at May
  3, 1998.  (Funded debt equals long-term debt,  including  current  maturities,
  less restricted investments,  which represent unspent IRB funds). The decrease
  in funded debt from May 3, 1998  resulted  primarily  from an  operating  cash
  flow of $25.0 million,  offset by capital  expenditures  of $8.5 million and a
  decrease in accounts payable related to capital expenditures of $2.8 million.