content: --------------------------------------------------------------------------------
  
                                   UNITED STATES
                        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) August 26, 2004
  
                                     CULP, INC.
  
              (Exact name of registrant as specified in its charter)
  
  
           North Carolina                  0-12781                56-1001967
  (State or other jurisdiction of   (Commission File No.)       (IRS Employer
           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>
  
                                      INDEX
                                      -----
  
  
                                                                       Page
  
  Item 2.02 -     Results of Operations and Financial                    3
                  Condition
  
  Item 9.01(c) -  Exhibits                                               3
  
  Signature                                                              4
  
  Exhibits
  
  
  
  <PAGE>
  
  
      Item 2.02 - Results of Operations and Financial Condition
  
  On August 26, 2004, Culp, Inc. (the "Registrant" or the "company") issued a news
  release to announce its financial  results for the first quarter ended August 1,
  2004. The news release is attached hereto as Exhibit 99(a).
  
  Also on August 26, 2004, the Registrant released a Financial Information Release
  containing   additional   financial   information  and  disclosures   about  the
  Registrant's  first  quarter  ended August 1, 2004.  The  Financial  Information
  Release is attached hereto as Exhibit 99(b).
  
  The news release and Financial  Information  Release contain  disclosures  about
  proforma  income  statement  information,  which  reconciles the reported income
  statement  information with proforma  results,  which exclude  restructuring and
  related   charges  and  credits.   The  company  has  included   this   proforma
  information in order to show  operational  performance  excluding the effects of
  restructuring  and related  charges and credits  that are not  expected to occur
  on  a  regular  basis.   Management  believes  this  presentation  aids  in  the
  comparison of financial results among comparable financial periods.
  
  
  Forward  Looking  Information.  This  Report and the  exhibits  attached  hereto
  contain  statements that may be deemed  "forward-looking  statements" within the
  meaning  of the  federal  securities  laws,  including  the  Private  Securities
  Litigation  Reform Act of 1995  (Section 27A of the  Securities  Act of 1933 and
  Section 27A of the  Securities  and Exchange Act of 1934).  Such  statements are
  inherently  subject  to  risks  and  uncertainties.   Further,  forward  looking
  statements  are  intended  to speak  only as of the date on which they are made.
  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 but not always  characterized  by
  qualifying words such as "expect,"  "believe,"  "estimate," "plan" and "project"
  and their  derivatives,  and  include but are not  limited to  statements  about
  expectations for the company's  future sales,  gross profit and operating income
  margins,  SG&A or other expenses and earnings.  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.  In
  addition,  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.  Also,  economic and political  instability in  international
  areas could affect the company's  operations or sources of goods in those areas,
  as well as demand for the company's products in international markets.  Finally,
  unanticipated delays or costs in executing restructuring actions could cause the
  cumulative  effect of  restructuring  actions to fail to meet the objectives set
  forth by  management.  Other factors that could affect the matters  discussed in
  forward looking  statements are included in the company's periodic reports filed
  with the Securities and Exchange Commission.
  
  Item 9.01 (c) -- Exhibits
  
  99(a)  News Release dated August 26, 2004
  
  99(b)  Financial Information Release dated August 26, 2004
  
  
  
  <PAGE>
  
  
  
  
  
                                     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:    Franklin  N. Saxon
                                       ------------------
                                       President and Chief Operating Officer
  
                                By:    Kenneth  R. Bowling
                                       -------------------
                                       Vice President-Finance, Treasurer
  
  
  Dated:  August 26, 2004
  <PAGE>
  
  
                                    NEWS RELEASE
  
  Investor Contact:  Kathy J. Hardy        Media Contact: Kenneth M. Ludwig
                     Corporate Secretary                  Senior Vice President,
                     336-888-6209                         Human Resources
                                                          336-889-5161
  
  
                  CULP ANNOUNCES FIRST QUARTER FISCAL 2005 RESULTS
  
  
  HIGH POINT,  N.C.  (August 26, 2004) - Culp,  Inc.  (NYSE:  CFI) today  reported
  financial  and  operating  results  for the first  quarter of fiscal  2005 ended
  August 1, 2004. The highlights include:
  
  o     Mattress  fabrics  segment  average  weekly  sales  up 2.7  percent during
        period of transition to one-sided mattresses.
  
  o     Aggressive  expansion  of  offshore  sourcing  capabilities,  resulting in
        sales of  sourced  upholstery  fabrics  more  than  doubling over the same
        period last year.
  
  o     Long-term   debt-to-capital  ratio  of  33.3  percent compared  with  44.5
        percent a year ago.
  
  o     Earnings  expectation  for the second quarter of fiscal 2005 is net income
        of $0.13 to $0.17 per diluted share.
  
  Overview
  
  For the three months ended August 1, 2004, net sales were $67.8 million compared
  with  $73.7  million a year ago, a 7.9  percent  decline.  The first  quarter of
  fiscal  2005  included 13 weeks  versus 14 weeks for the same  quarter of fiscal
  2004. The company reported a net loss of $1,052,000, or $0.09 per diluted share,
  for the first quarter of fiscal 2005  compared  with a net loss of $411,000,  or
  $0.04 per  diluted  share,  for the first  quarter  of  fiscal  2004.  Excluding
  restructuring and related charges and credits of approximately  $42,000,  net of
  income taxes,  the net loss for the first quarter of fiscal 2005 was $1,094,000,
  or $0.09 per diluted share.
  
  "Considering  one less  week's  sales,  our average  weekly  sales for the first
  fiscal  quarter  of 2005 were $5.2  million  compared  with $5.3  million in the
  prior-year  period,  a decrease of less than 1.0 percent,"  commented  Robert G.
  Culp, III,  chairman of the board and chief executive officer of Culp, Inc. "The
  first  quarter of our fiscal year is typically  the slowest  period for Culp and
  the furniture  industry with scheduled  plant vacation  shutdowns.  The seasonal
  slowdown,  combined with the continued weakness in consumer demand for furniture
  throughout  the  summer,   accounted  for  this  modest  drop.  We  believe  our
  competitive position is strong and we are excited about the growth opportunities
  in our mattress ticking business and our offshore sourcing strategy."
  
  Mattress Fabrics Segment
  
  Mattress  fabric (known as mattress  ticking) sales were $26.0 million  compared
  with $27.2 million for the first quarter of fiscal 2004, a 4.7 percent  decline.
  As noted,  these results  reflect a 13-week  period versus a 14-week period last
  year.  Average  weekly  sales for the  first  quarter  of fiscal  2005 were $2.0
  million compared with $1.9 million in the prior-year  period, an increase of 2.7
  percent.  This  increase is especially  noteworthy  considering  our  customers'
  recent transition to one-sided mattresses,  which utilize one-third less fabric.
  Operating  income for this segment was $2.9  million,  or 11.2 percent of sales,
  compared with $4.1 million, or 15.2 percent of sales, for the prior-year period.
  Operating income was primarily affected by one week's less sales for the quarter
  and inventory markdowns related to certain customer programs.  These factors are
  expected to have  significantly  less  impact on the  segment's  second  quarter
  results.
  
  Culp remarked,  "We are seeing positive trends in our mattress  ticking business
  and  continue  to  make  gains  with  key  customers.  Consumer  trends  and the
  attractiveness  of this product  category for retailers  favor further growth in
  bedding demand, and we believe that Culp is well positioned to benefit from this
  growth  as  a  leading  provider  of  mattress  ticking.  Additionally,   unlike
  upholstery  fabrics,  the mattress  fabric  business is not being  threatened by
  Asian  imports  because of the  relatively  low average  price  points and labor
  content and the just-in-time  delivery  requirements of this business.  Further,
  Asian imports of finished mattresses have been limited to less than four percent
  of the U.S.  market  because of high  shipping  costs as well as the  customized
  product lines and strong brand name recognition associated with mattresses. With
  our  leadership  in product  design,  superior  customer  service  and  delivery
  performance,  and a globally  competitive  cost  structure,  we expect  that the
  mattress  ticking  business will account for an increasing  percentage of Culp's
  overall sales and profitability in fiscal 2005."
  
  Upholstery Fabrics Segment
  
  Sales for this segment were $41.9 million,  a 9.8 percent decline  compared with
  $46.5 million in the first quarter of fiscal 2004.  Average weekly sales for the
  first quarter of fiscal 2005 were $3.2 million compared with $3.3 million in the
  prior year  period,  a decrease  of 2.9  percent.  Sales of  upholstery  fabrics
  reflect soft demand by furniture retailers during the summer months.  Additional
  factors  affecting the demand for  upholstery  fabrics are the current  consumer
  preference  for  leather  furniture  and  increased  competition  from  imported
  fabrics, including cut and sewn kits, primarily from Asia.
  
  "It has  become  increasingly  evident  that  competitive  forces in the  global
  marketplace  are  significantly  changing  the  face  of the  furniture  and the
  upholstery fabrics industries," added Culp.  "However,  we believe that Culp has
  made  significant  progress in adapting our business  model to take advantage of
  this  transition and position  ourselves more  effectively in this  environment.
  First,  we  have   significantly   adjusted  our  cost  structure  and  domestic
  manufacturing  capacity over the past several years.  Second, we have focused on
  design  creativity and product  development to provide breadth and innovation in
  the fabrics  offered to our  customers to meet  changing  consumer  preferences.
  Third,  we have  implemented a dual strategy to  aggressively  develop  offshore
  sourcing  capabilities  for Culp.  In fiscal 2003 we put in place the  necessary
  resources to begin sourcing from Asia certain  upholstery fabrics that we do not
  manufacture,  and we  have  continued  to  expand  these  resources.  The  other
  component of Culp's offshore sourcing strategy is our China operation,  where we
  are now well underway with our manufacturing operations and our fabric shipments
  to  customers.  Sales  of  upholstery  fabrics  produced  outside  of  our  U.S.
  manufacturing  plants, which include the popular micro-denier suedes and fabrics
  produced at our China facility,  accounted for  approximately  $5.5 million,  or
  13.1 percent,  of  upholstery  fabric  sales for the  quarter.  Sourced  fabrics
  accounted for  approximately  $2.1 million,  or 4.5 percent of upholstery fabric
  sales for the same period last year."
  
  Operating  loss for the  upholstery  fabrics  segment was $2.6  million,  or 6.1
  percent of sales, compared with a loss of $1.7 million, or 3.7 percent of sales,
  for the same period last year. The segment loss in each period was primarily due
  to underutilization of the company's U.S.  manufacturing  capacity.  Culp noted,
  "If sales continue to be under pressure in the upholstery  fabrics  segment,  we
  are prepared to take the necessary  actions to further adjust our cost structure
  and U.S. capacity, as we have demonstrated in recent years."
  
  Balance Sheet
  
  "One  of our  key  financial  objectives  for  fiscal  2005  is to  continue  to
  capitalize on the strength of our balance sheet," added Culp. "At the end of the
  first fiscal quarter, our balance sheet reflects  approximately $12.0 million in
  cash and cash  equivalents.  Long-term debt now stands at $51.1 million compared
  with $76.6 million a year ago. As a result, our long-term  debt-to-capital ratio
  is now 33.3 percent  compared with 44.5 percent a year ago. Our balance sheet is
  sound with  significantly  lower debt,  excellent  liquidity  and the  financial
  flexibility to pursue our strategic initiatives."
  
  Outlook
  
  Commenting  on the business  outlook,  Culp said,  "Mattress  ticking sales have
  already picked up during the early part of our second  quarter.  For the current
  quarter,  we  expect  sales in this  segment  to be  moderately  ahead of second
  quarter sales last year and expect that operating  income will  approximate last
  year's  level.  With  respect to the  upholstery  fabrics  segment,  the outlook
  remains  uncertain  for  a  sustained  recovery  in  retail  furniture  business
  conditions.  We are optimistic that upholstery fabric sales will also pick up in
  the fall, as is seasonally  typical in the  furniture  industry.  For the second
  quarter, upholstery fabrics segment sales are expected to decrease less than the
  first quarter decline of 9.8 percent. While we do expect to be profitable in the
  upholstery fabrics segment, operating income will be down considerably from last
  year's second quarter. At this time, we expect to report net income in the range
  of $0.13 to $0.17 per share diluted, with the actual results depending primarily
  on the level of demand throughout the quarter.  We believe the excellence in our
  design creativity, the strength in our mattress ticking business, the aggressive
  expansion of our offshore  sourcing  capabilities  and our sound  balance  sheet
  effectively position Culp in today's marketplace."
  
  Culp,  Inc.  is one of the world's  largest  marketers  of mattress  fabrics for
  bedding and  upholstery  fabrics for furniture.  The company's  fabrics are used
  principally in the production of bedding products and residential and commercial
  upholstered furniture.
  
  This release contains statements that may be deemed "forward-looking statements"
  within  the  meaning of the  federal  securities  laws,  including  the  Private
  Securities  Litigation  Reform Act of 1995 (Section 27A of the Securities Act of
  1933  and  Section  27A of the  Securities  and  Exchange  Act  of  1934).  Such
  statements  are  inherently  subject  to  risks  and   uncertainties.   Further,
  forward-looking  statements  are  intended to speak only as of the date on which
  they  are  made.   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 but not always
  characterized  by  qualifying  words such as  "expect,"  "believe,"  "estimate,"
  "plan" and "project" and their  derivatives,  and include but are not limited to
  statements about expectations for the company's future sales,  operating income,
  gross profit margins, SG&A or other expenses,  and earnings.  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.  In  addition,   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.  Also,  economic  and  political
  instability  in  international  areas could affect the  company's  operations or
  sources of goods in those areas, as well as demand for the company's products in
  international  markets.  Finally,  unanticipated  delays  or costs in  executing
  restructuring actions could cause the cumulative effect of restructuring actions
  to fail to meet the objectives set forth by management. Other factors that could
  affect the matters discussed in  forward-looking  statements are included in the
  company's periodic reports filed with the Securities and Exchange Commission.
  
  
  
                                     CULP, INC.
                           Condensed Financial Highlights
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net sales                                            $67,849,000  $73,676,000
                                                       ============ ============
  Net loss                                             $(1,052,000) $  (411,000)
                                                       ============ ============
  Basic and diluted net loss per share:
     Basic                                             $     (0.09) $     (0.04)
     Diluted                                           $     (0.09) $     (0.04)
                                                       ============ ============
  Average shares outstanding:
    Basic                                               11,547,000   11,515,000
    Diluted                                             11,547,000   11,515,000
  
  
            Reconciliation of Net Loss as Reported to Pro Forma Net Loss
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net loss, as reported                                $(1,052,000) $  (411,000)
  Restructuring and related charges (credits),
    net of income taxes                                    (42,000)          -0-
                                                       ------------ ------------
  Pro forma net loss                                   $(1,094,000) $  (411,000)
                                                       ============ ============
  
  
  Reconciliation of Net Loss Per Share as Reported to Pro Forma Net Loss Per Share
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net loss per share, as reported                      $     (0.09)  $    (0.04)
  Restructuring and related charges (credits),
    net of income taxes                                         -0-          -0-
                                                       ------------ ------------
  Pro forma net loss per share                         $     (0.09)  $    (0.04)
                                                       ===========  ============
  
                                     -END-
  
  
  <PAGE>
  Exhibit 99(b)
  
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                           CONSOLIDATED STATEMENTS OF LOSS
            FOR THE THREE MONTHS ENDED August 1, 2004 AND August 3, 2003
  
                  (Amounts in Thousands, Except for Per Share Data)
  <TABLE>
  <CAPTION>
  
                                                                         THREE MONTHS ENDED (UNAUDITED)
                                                    -----------------------------------------------------------------------------
                                                             Amounts                                     Percent of Sales
                                                    --------------------------                    -------------------------------
                                                     August 1,     August 3,       % Over            August 1,        August 3,
                                                       2004          2003         (Under)              2004             2003
                                                    ------------  ------------  -------------     --------------  ---------------
  <S>                                            <C>                  <C>          <C>                <C>             <C>
  Net sales                                      $       67,849        73,676       (7.9) %            100.0 %         100.0 %
  Cost of sales (1)                                      59,174        62,198       (4.9) %             87.2 %          84.4 %
                                                    ------------  ------------  -------------     --------------  ---------------
     Gross profit                                         8,675        11,478      (24.4) %             12.8 %          15.6 %
  
  Selling, general and
    administrative expenses                               9,280        10,516      (11.8) %             13.7 %          14.3 %
  Restructuring credit                                     (138)            0      100.0  %             (0.2)%           0.0 %
                                                    ------------  ------------  ----------        --------------  ---------------
     Income  (loss) from operations                        (467)          962     (148.5) %             (0.7)%           1.3 %
  
  Interest expense                                          940         1,497      (37.2) %              1.4 %           2.0 %
  Interest income                                           (27)         (122)     (77.9) %             (0.0)%          (0.2)%
  Other expense                                             214           239      (10.5) %              0.3 %           0.3 %
                                                    ------------  ------------  -------------     --------------  ---------------
     Loss before income taxes                            (1,594)         (652)    (144.5) %             (2.3)%          (0.9)%
  
  Income taxes*                                            (542)         (241)     124.9  %             34.0 %          37.0 %
                                                    ------------  ------------  -------------     --------------  ---------------
  
     Net loss                                    $       (1,052)         (411)    (156.0) %             (1.6)%          (0.6)%
                                                    ============  ============  =============     ==============  ===============
  
  Net loss per share-basic                       $        (0.09)        (0.04)    (125.0) %
  Net loss per share-diluted                     $        (0.09)        (0.04)    (125.0) %
  Net loss per share, diluted, excluding
      restructuring and related charges and
      credits (2)                                $        (0.09)        (0.04)    (125.0) %
  Average shares outstanding-basic                       11,547        11,515        0.3 %
  Average shares outstanding-diluted                     11,547        11,515        0.3 %
  
  </TABLE>
  
  
   *  Percent of sales column for income taxes is calculated as a % of loss before
      income taxes.
  
  (1) Cost of sales includes $75.0 of restructuring related charges for the
      three months ended August 1, 2004.
  
  (2) Reconciliation of net loss as reported to pro forma net loss:
  <TABLE>
  <CAPTION>
  
                                                                                 THREE MONTHS ENDED (UNAUDITED)
                                                            --------------------------------------------------------------------------
                                                                     Amounts                                  Percent of Sales
                                                            --------------------------                 -------------------------------
                                                             August 1,     August 3,      % Over         August 1,       August 3,
                                                               2004          2003        (Under)           2004            2003
                                                            ------------  ------------  ----------     --------------  ---------------
  <S>                                                    <C>                <C>         <C>             <C>              <C>
  Net loss, as reported                                  $    (1,052)         (411)      (156.0)%         (1.6) %          (0.6) %
  Restructuring and related charges
  (credits), net of taxes (a)                                    (42)            0        100.0 %         (0.1) %           0.0  %
                                                            ------------  ------------  ----------     --------------  ---------------
     Proforma net loss                                        (1,094)         (411)      (166.2)%         (1.6) %          (0.6) %
  
  Pro forma net loss per share-basic                     $     (0.09)        (0.04)      (125.0)%
  Pro forma net loss per share-diluted                   $     (0.09)        (0.04)      (125.0)%
  
  (a) Represents the $138.0 restructuring credit, offset by the $75.0 in
      restructuring related charges, net of taxes to arrive at $42.0.
  </TABLE>
  
  <PAGE>
  
                    CULP, INC. FINANCIAL INFORMATION RELEASE
                             CONSOLIDATED BALANCE SHEETS
                   AUGUST 1, 2004, AUGUST 3, 2003 AND MAY 2, 2004
                                      Unaudited
                               (Amounts in Thousands)
  <TABLE>
  <CAPTION>
                                                         Amounts                     Increase
                                                ---------------------------         (Decrease)
                                                 August 1,      August 3,    -------------------------   * May 2,
                                                    2004          2003        Dollars     Percent          2004
                                                -------------  ------------  ----------- -------------  -----------
  <S>                                         <C>                 <C>          <C>         <C>            <C>
  Current assets
     Cash and cash equivalents                $       11,946        15,094       (3,148)     (20.9)%        14,568
     Short-term investments                                0        15,014      (15,014)    (100.0)%             0
     Accounts receivable                              24,242        24,227           15        0.1 %        30,719
     Inventories                                      52,083        49,275        2,808        5.7 %        49,045
     Deferred income taxes                             9,256        12,303       (3,047)     (24.8)%         9,256
     Other current assets                              1,645         4,001       (2,356)     (58.9)%         1,634
                                                -------------  ------------  ----------- -------------  -----------
                   Total current assets               99,172       119,914      (20,742)     (17.3)%       105,222
  
  Property, plant & equipment, net                    78,880        83,299       (4,419)      (5.3)%        77,770
  Goodwill                                             9,240         9,240            0        0.0 %         9,240
  Other assets                                         1,307         1,934         (627)     (32.4)%         1,496
                                                -------------  ------------  ----------- -------------  -----------
  
                   Total assets               $      188,599       214,387      (25,788)     (12.0)%       193,728
                                                =============  ============  =========== =============  ===========
  
  
  
  Current liabilities
     Current maturities of long-term debt     $          545           517           28        5.4 %           528
     Accounts payable                                 14,857        18,648       (3,791)     (20.3)%        15,323
     Accrued expenses                                 10,880        12,856       (1,976)     (15.4)%        13,028
     Accrued restructuring                             4,656         7,141       (2,485)     (34.8)%         4,968
     Income taxes payable                                606             0          606      100.0 %         1,850
                                                -------------  ------------  ----------- ----------     -----------
                   Total current liabilities          31,544        39,162       (7,618)     (19.5)%        35,697
  
  Long-term debt , less current maturities            50,519        76,034      (25,515)     (33.6)%        50,502
  
  Deferred income taxes                                4,138         3,851          287        7.5 %         4,138
                                                -------------  ------------  ----------- -------------  -----------
                   Total liabilities                  86,201       119,047      (32,846)     (27.6)%        90,337
  
  Shareholders' equity                               102,398        95,340        7,058        7.4 %       103,391
                                                -------------  ------------  ----------- -------------  -----------
  
                   Total liabilities and
                   shareholders' equity       $      188,599       214,387      (25,788)     (12.0)%       193,728
                                                =============  ============  =========== =============  ===========
  
  Shares outstanding                                  11,548        11,515           33        0.3 %        11,547
                                                =============  ============  =========== =============  ===========
  
  </TABLE>
  
     * Derived from audited financial statements
  <PAGE>
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
            FOR THE THREE MONTHS ENDED AUGUST 1, 2004 AND AUGUST 3, 2003
  
                                      Unaudited
                               (Amounts in Thousands)
  
  <TABLE>
  <CAPTION>
                                                                            THREE MONTHS ENDED
                                                                         --------------------------
                                                                                  Amounts
                                                                         --------------------------
                                                                          August 1,     August 3,
                                                                            2004          2003
                                                                         ------------  ------------
  <S>                                                                  <C>                <C>
  Cash flows from operating activities:
      Net loss                                                         $      (1,052)         (411)
      Adjustments to reconcile net loss to net cash
         provided by operating activities:
            Depreciation                                                       3,362         3,444
            Amortization of other assets                                          37            45
            Stock-based compensation                                              52            53
            Restructuring credit                                                (138)            0
            Changes in assets and liabilities:
               Accounts receivable                                             6,477         8,032
               Inventories                                                    (3,038)          277
               Other current assets                                              (11)         (797)
               Other assets                                                      206           256
               Accounts payable                                                  112          (845)
               Accrued expenses                                               (2,148)       (1,215)
               Accrued restructuring                                            (228)         (602)
               Income taxes payable                                           (1,244)         (349)
                                                                         ------------  ------------
                  Net cash provided by operating activities                    2,387         7,888
                                                                         ------------  ------------
  
  Cash flows from investing activities:
      Capital expenditures                                                    (4,375)       (1,875)
      Purchases of short-term investments                                          0        (5,038)
                                                                         ------------  ------------
                  Net cash used in investing activities                       (4,375)       (6,913)
                                                                         ------------  ------------
  
  Cash flows from financing activities:
      Payments on vendor-financed capital expenditures                          (675)         (287)
      Proceeds from issuance of long-term debt                                    34            51
      Proceeds from common stock issued                                            7             0
                                                                         ------------  ------------
                  Net cash used in financing activities                         (634)         (236)
                                                                         ------------  ------------
  
  Increase (decrease) in cash and cash equivalents                            (2,622)          739
  
  Cash and cash equivalents at beginning of period                            14,568        14,355
                                                                         ------------  ------------
  
  Cash and cash equivalents at end of period                          $       11,946        15,094
                                                                         ============  ============
  </TABLE>
  <PAGE>
  
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                                 FINANCIAL ANALYSIS
                                   August 1, 2004
  <TABLE>
  <CAPTION>
  
                                              FISCAL 04                     FISCAL 05
                                         -----------------  --------------------------------------
                                                  Q1              Q1       Q2        Q3      Q4
                                         -----------------  --------------------------------------
  <S>                                      <C>              <C>
  INVENTORIES
     Inventory turns                              5.0            4.7
  
  RECEIVABLES
     Days sales in receivables                     32             30
  
  WORKING CAPITAL
     Current ratio                                3.1            3.1
     Operating working capital turnover (1)       5.1            5.1
     Operating working capital (1)            $54,854        $61,468
  
  PROPERTY, PLANT & EQUIPMENT
     Depreciation rate                           6.2%           6.1%
     Percent property, plant &
       equipment are depreciated                62.3%          64.2%
     Capital expenditures                      $6,747 (2)     $4,543
  
  LEVERAGE
     Total liabilities/equity                  124.7%          84.2%
     Long-term debt/equity                      80.3%          49.9%
     Long-term debt/capital employed (3)        44.5%          33.3%
     Long-term debt                           $76,551        $51,064
  
  OTHER
     Book value per share                       $8.28          $8.87
     Employees at quarter end                   2,383          2,235
     Sales per employee (annualized)         $121,628       $119,190
     Capital employed (3)                    $171,891       $153,462
  
    (1) Working capital for this calculation is accounts receivable, inventories
        and accounts payable.
    (2) Expenditures for entire year.
    (3) Capital employed represents long-term debt plus stockholders equity; Long-
        term debt is long-term debt plus current maturities of of long-term debt.
  </TABLE>
  <PAGE>
                      CULP, INC. FINANCIAL INFORMATION RELEASE
         SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT/DIVISION
            FOR THE THREE MONTHS ENDED AUGUST 1, 2004 AND AUGUST 3, 2003
  
  
                               (Amounts in thousands)
  <TABLE>
  <CAPTION>
  
                                                                    THREE MONTHS ENDED (UNAUDITED)
                                                 ------------------------------------------------------------------
                                                       Amounts                           Percent of Total Sales
                                                 ---------------------              ------------------------------
                                                 August 1,   August  3,   % Over     August 1,       August 3,
  Net Sales by Segment                             2004        2003       (Under)      2004            2003
  ---------------------------------------------  ----------  ---------  ----------  -------------  ---------------
  <S>                                           <C>          <C>        <C>          <C>              <C>
  Mattress Fabrics
       Culp Home Fashions                      $    25,953     27,220      (4.7) %         38.3 %          36.9 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Upholstery Fabrics
      Culp Decorative Fabrics                       23,919     29,617     (19.2) %         35.3 %          40.2 %
      Culp Velvets/Prints                           17,977     16,839       6.8  %         26.5 %          22.9 %
                                                 ----------  ---------  ----------  -------------  ---------------
                                                    41,896     46,456      (9.8) %         61.7 %          63.1 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
       Net Sales                               $    67,849     73,676      (7.9) %        100.0 %         100.0 %
                                                 ==========  =========  ==========  =============  ===============
  
  
  Gross Profit by Segment                                                                 Gross Profit Margin
  ---------------------------------------------                                     ------------------------------
  
  Mattress Fabrics                             $     4,794      6,072     (21.0) %         18.5 %          22.3 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Pro forma Upholstery Fabrics                       3,956      5,406     (26.8) %          9.4 %          11.6 %
      Restructuring related charges (1)                 75          0     100.0  %          0.2 %           0.0 %
                                                 ----------  ---------  ----------  -------------  ---------------
  Upholstery Fabrics gross profit                    3,881      5,406     (28.2) %          9.3 %          11.6 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  
       Gross Profit                            $     8,675     11,478     (24.4) %         12.8 %          15.6 %
                                                 ==========  =========  ==========  =============  ===============
  
  
  Operating Income (loss)  by Segment                                                Operating Income (Loss) Margin
  ---------------------------------------------                                     ------------------------------
  
  Mattress Fabrics                             $     2,899      4,144     (30.0) %         11.2 %          15.2 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Pro forma Upholstery Fabrics                      (2,619)    (1,719)    (52.4) %         (6.3)%          (3.7)%
       Restructuring and related charges
       and credits (1)                                  63          0     100.0  %          0.2 %           0.0 %
                                                 ----------  ---------  ----------  -------------  ---------------
  Upholstery Fabrics operating loss                 (2,556)    (1,719)    (48.7) %         (6.1)%          (3.7)%
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Unallocated corporate expenses                      (810)    (1,463)     44.6  %         (1.2)%          (2.0)%
                                                 ----------  ---------  ----------  -------------  ---------------
  
       Operating income (loss)                 $      (467)       962    (148.5) %         (0.7)%           1.3 %
                                                 ==========  =========  ==========  =============  ===============
  
  Depreciation by Segment
  ---------------------------------------------
  Mattress Fabrics                             $       916        944      (3.0) %
  Upholstery Fabrics                                 2,446      2,499      (2.1) %
                                                 ----------  ---------  ----------
  Total Depreciation                           $     3,362      3,444      (2.4) %
                                                 ==========  =========  ==========
  
  
  (1)  Restructuring and related charges include a credit of $138.0 for the
       reversal of certain accrued expenses, offset by $75.0 in equipment
       dismantling charges; both related to the closing of the Lumberton
       manufacturing facility.
  
  </TABLE>
  <PAGE>
                      CULP, INC. FINANCIAL INFORMATION RELEASE
             SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT
                        FOR THE FISCAL YEAR ENDED MAY 2, 2004
  
                                     (UNAUDITED)
                               (Amounts in thousands)
  <TABLE>
  <CAPTION>
  
  
  Net Sales by Segment
  ----------------------------------
                                          QTR 1                 QTR 2                 QTR 3             QTR 4
                                 --------------------  -------------------  -------------------  -----------------
                                 August 3,    % of     November 2,   % of   February 1,   % of    May 2,    % of      Fiscal    % of
                                   2003       Sales       2003       Sales    2004        Sales    2004     Sales      2004     Sales
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  <S>                           <C>            <C>       <C>       <C>       <C>        <C>     <C>        <C>      <C>        <C>
  Mattress Fabrics
       Culp Home Fashions       $   27,220     36.9%      26,788    32.4%     25,114     32.8%   27,200     31.9%    106,322    33.4%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Upholstery Fabrics
      Culp Decorative Fabrics       29,617     40.2%      32,459    39.2%     29,678     38.8%   32,519     38.2%    124,273    39.1%
      Culp Velvets/Prints           16,839     22.9%      23,484    28.4%     21,769     28.4%   25,429     29.9%     87,521    27.5%
                                 ----------  --------  ----------  -------  ---------  --------  --------  -------  ---------  -------
  
                                    46,456     63.1%      55,943    67.6%     51,447     67.2%   57,948     68.1%    211,794    66.6%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Net Sales                $   73,676    100.0%      82,731   100.0%     76,561    100.0%   85,148    100.0%    318,116   100.0%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  Gross Profit by Segment
  ----------------------------------
  
  Mattress Fabrics              $    6,072     22.3%       6,329    23.6%      5,093     20.3%    5,883     21.6%     23,377    22.0%
  
  Upholstery Fabrics                 5,406     11.6%      10,409    18.6%      9,375     18.2%    9,755     16.8%     34,945    16.5%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Gross profit             $   11,478     15.6%      16,738    20.2%     14,468     18.9%   15,638     18.4%     58,322    18.3%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  
  Operating Income (loss) by Segment
  ----------------------------------
  
  Mattress Fabrics              $    4,144     15.2%       4,247    15.9%      3,039     12.1%    3,555     13.1%     14,985    14.1%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Pro forma Upholstery Fabrics      (1,719)    -3.7%       3,452     6.2%      2,260      4.4%    2,844      4.9%      6,837     3.2%
      Restructuring credit               0      0.0%           0     0.0%          0      0.0%   (1,047)    -1.8%     (1,047)   -0.5%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  Upholstery Fabrics operating
      income (loss)                 (1,719)    -3.7%       3,452     6.2%      2,260      4.4%    3,891      6.7%      7,884     3.7%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Unallocated corporate expenses    (1,463)    -2.0%      (1,257)   -1.5%     (1,113)    -1.5%     (686)    -0.8%     (4,519)   -1.4%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Operating income         $      962      1.3%       6,442     7.8%      4,186      5.5%    6,760      7.9%     18,350     5.8%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  Depreciation by Segment
  ----------------------------------
  
  Mattress Fabrics              $      944                  942                  937               930                3,753
  Upholstery Fabrics                 2,499                2,498                2,476             2,417                9,889
                                 ----------            ----------           ---------           -------             ---------
  Total Depreciation            $    3,444                3,439                3,412             3,348               13,642
                                 ==========            ==========           =========           =======             =========
  
  
  
  
  </TABLE>
  <PAGE>
  
  
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                                 FINANCIAL NARRATIVE
            for the three months ended August 1, 2004 and August 3, 2003
  
  
  
  
  OVERVIEW
  
  Highlights for the first quarter ended August 1, 2004 , include:
  
  o     Mattress  fabrics  segment  average  weekly  sales  up 2.7 percent  during
        period of transition to one-sided mattresses.
  
  o     Aggressive  expansion  of  offshore  sourcing  capabilities,  resulting in
        sales  of sourced  upholstery fabrics  more than  doubling over  the  same
        period last year.
  
  o     Long-term debt-to-capital ratio of 33.3% compared with 44.5% a year ago.
  
  o     Earnings  expectation for the second  quarter of fiscal 2005 is net income
        of $0.13 to $0.17 per diluted share.
  
  
  GENERAL - The first quarter of the fiscal year is typically  the slowest  period
  for the company and the  furniture  industry  due to  scheduled  plant  vacation
  shutdowns.  The  seasonal  slowdown,  combined  with the  continued  weakness in
  consumer demand for furniture  throughout the summer,  accounted for this modest
  drop. In addition,  the first quarter of fiscal 2005 included 13 weeks versus 14
  weeks for the same period of fiscal 2004.  For the first quarter of fiscal 2005,
  net sales  decreased 7.9% to $67.8  million.  Average weekly sales for the first
  quarter of fiscal 2005 were $5.2 million compared with $5.3 million in the prior
  year period,  a decrease of less than 1.0%.  The company  reported a net loss of
  $1,052,000, or $0.09 per share diluted, compared with a net loss of $411,000, or
  $0.04 per  share  diluted,  in the  first  quarter  of  fiscal  2004.  Excluding
  restructuring and related charges and credits of approximately  $42,000,  net of
  income taxes, the net loss for the quarter was $1,094,000.  These results are in
  line with the  previously  announced  guidance of an  expected  loss of $0.08 to
  $0.13 per share.
  
  
  STATEMENT OF OPERATIONS COMMENTS
  
  
       MATTRESS FABRICS SEGMENT (See page 5 - Sales, Gross Profit and Operating
       Income (Loss) by Segment)
  
       Net Sales -- Mattress  fabric  sales  (known as mattress  ticking)  for the
  first quarter of fiscal 2005 decreased 4.7% to $26.0 million compared with $27.2
  million for the same period a year ago. As noted above,  these results reflect a
  13 week period versus a 14 week period last year.  Average  weekly sales for the
  first quarter of fiscal 2005 were $2.0 million compared with $1.9 million in the
  prior year  period,  an increase of 2.7%.  While sales,  on a comparable  basis,
  continue  to be  affected  by the  recent  customers'  transition  to  one-sided
  mattresses,  which utilize  one-third less fabric,  the mattress ticking segment
  experienced higher sales, on an average weekly basis, by expanding business with
  certain key accounts.  Also,  mattress  manufacturers  are  currently  incurring
  higher  costs for other  mattress  components,  such as steel,  as well as costs
  associated  with flame  retardant  requirements.  As a result of these increased
  costs,  mattress  manufacturers  are  placing  additional  pressure  on mattress
  ticking prices,  and in some instances  manufacturers are moving to lower priced
  ticking.
  
  Mattress  ticking  yards sold during the first  quarter of fiscal 2005 were 10.8
  million  compared with 10.5 million yards in the first quarter of last year. The
  average  selling  price was $2.38 per yard for the first  quarter,  compared  to
  $2.57 per yard in the same quarter last year, a decrease of 7.4%.
  
       Operating  income -- For the first  quarter of fiscal  2005,  the  mattress
  fabrics segment reported  operating  income of $2.9 million,  or 11.2% of sales,
  compared  with $4.1  million,  or 15.2% of sales,  for the  prior  year  period.
  Operating  income was  primarily  impacted by fewer  sales  weeks and  inventory
  markdowns  related to certain customer  programs.  These factors are expected to
  have significantly less impact on the segment's second quarter results.
  
  
  
       UPHOLSTERY FABRICS SEGMENT (See page 5 - Sales, Gross Profit and Operating
       Income (Loss) by Segment)
  
       Net Sales --  Upholstery  fabric sales for the first quarter of fiscal 2005
  decreased  9.8% to $41.9  million when  compared to the first  quarter of fiscal
  2004.  Average  weekly  sales for the  first  quarter  of fiscal  2005 were $3.2
  million compared with $3.3 million in the prior year period, a decrease of 2.9%.
  The lower sales primarily reflect soft demand by furniture retailers, as well as
  current consumer preference for leather furniture and increased competition from
  imported fabrics, including cut and sewn kits, primarily from Asia.
  
  With the company's offshore sourcing efforts,  including the China platform, the
  company is  experiencing  higher sales of upholstery  fabric  products  produced
  outside of the company's U.S.  manufacturing  plants. These sales, which include
  microdenier suedes and fabrics produced at the company's China plant,  increased
  162% over the prior year period and accounted for approximately $5.5 million, or
  13.1% of upholstery  fabric sales for the quarter.  Offshore  sourced fabrics of
  $2.1 million accounted for approximately 4.5% of upholstery fabric sales for the
  same period last year.
  
  Upholstery  fabric yards sold during the first  quarter were 9.3 million  versus
  10.6 million in the first  quarter of fiscal  2004, a decline of 12.3%.  Average
  selling price was $4.25 per yard for the first  quarter  compared with $4.13 per
  yard in the same  quarter  of last  year,  an  increase  of 2.9%,  due to higher
  average selling prices in both the CDF and CVP divisions.
  
       Operating  income (loss) -- Operating  loss for the first quarter of fiscal
  2005 was $2.6 million,  or 6.1% of sales,  compared with a loss of $1.7 million,
  or 3.7% of sales, for the same period last year. The segment loss in each period
  was  primarily  due to  underutilization  of the  company's  U.S.  manufacturing
  capacity.  If sales  continue  to be under  pressure in the  upholstery  fabrics
  segment,  management is prepared to take the necessary actions to further adjust
  the company's cost structure and U.S. capacity,  as the company has demonstrated
  in recent years.
  
       SG&A  EXPENSES -- SG&A  expenses of $9.3  million for the first  quarter of
  fiscal 2005 decreased  approximately $1.2 million, or 11.8%, from the prior year
  amount. As a percent of net sales,  SG&A expenses  decreased to 13.7% from 14.3%
  the previous year, due mostly to lower professional fees.
  
       Unallocated Corporate Expenses - The unallocated corporate expense category
  includes  certain items that have not been  allocated to the company's  segments
  (see Page 5 - Sales and Gross  Profit/Operating  Income (Loss) by Segment).  The
  major  components of unallocated  corporate  expenses  include  compensation and
  benefits for certain executive  officers and all costs related to being a public
  company.  For the first quarter of fiscal 2005,  unallocated  corporate expenses
  totaled  $810,000  compared  with $1.5  million  for the same  period last year,
  reflecting a substantial decrease in professional fees.
  
       INTEREST  EXPENSE AND  INTEREST  INCOME --  Interest  expense for the first
  quarter  declined to $940,000  from $1.5 million the previous  year due to lower
  borrowings  outstanding.  Interest income decreased to $27,000 from $122,000 the
  previous year due to lower invested balances in fiscal 2005.
  
       INCOME TAXES -- The  effective  tax rate (taxes as a  percentage  of pretax
  income  (loss))  for the first  quarter of fiscal 2005 was 34.0%  compared  with
  37.0% for the same period last year.
  
  
  BALANCE SHEET COMMENTS
  ----------------------
  
       CASH AND CASH  EQUIVALENTS - Cash and cash equivalents as of August 1, 2004
  decreased  to $11.9  million  from  $14.6  million  at the end of  fiscal  2004,
  primarily  reflecting  cash flow from  operations  of $2.4  million  and capital
  expenditures  and  payments  on vendor  financed  capital  expenditures  of $5.0
  million.
  
       WORKING CAPITAL -- Accounts  receivable as of August 1, 2004 increased 0.1%
  from the year-earlier level. Days sales outstanding totaled 30 days at August 1,
  2004  compared  with 32 days a year ago.  Inventories  at the close of the first
  quarter  increased 5.7% from a year ago.  Inventory  turns for the first quarter
  were 4.7 versus  5.0 for the  year-earlier  period.  Operating  working  capital
  (comprised of accounts receivable and inventories,  less trade accounts payable)
  was $61.5 million at August 1, 2004, up from $54.9 million a year ago.
  
       PROPERTY,  PLANT AND EQUIPMENT -- Capital spending for the first quarter of
  fiscal  2005 was $4.5  million,  including  approximately  $3.9  million for the
  purchase of a building that will serve as the  company's  new corporate  offices
  and as new space for the  company's  showrooms.  The company  expects the annual
  operating costs of the new building to be significantly lower than the lease and
  related costs associated with the current facilities. Depreciation for the first
  quarter was $3.4 million,  and is estimated at $13.5 million for the full fiscal
  year.  For fiscal  2005,  the company  anticipates  capital  expenditures  to be
  approximately $9.0 million, including the $5.7 million budgeted for the building
  purchase and related renovations.
  
       INTANGIBLE  ASSETS -- As of August 1, 2004, $9.2 million in goodwill is the
  company's  only  intangible  asset.  This  goodwill is comprised of $4.1 million
  related to the mattress  fabrics  segment,  and $5.1 million related to the Culp
  Decorative Fabrics division within the upholstery fabrics segment.
  
       LONG-TERM  DEBT  -- The  company's  long-term  debt  of  $51.1  million  is
  unsecured and is comprised of $50.0 million in outstanding  senior notes, with a
  fixed interest rate of 7.76%, and a $1.1 million, non-interest bearing term loan
  with the  Canadian  government.  Additionally,  the company has a $15.0  million
  revolving  credit line with a bank, of which no balance is outstanding at August
  1, 2004.  The current bank  agreement,  which  expires in August 2004,  has been
  extended to August  2005.  The first  scheduled  principal  payment on the $50.0
  million  senior  notes is due  March  2006 in the  amount of $7.5  million.  The
  Canadian  government  loan is  repaid in annual  installments  of  approximately
  $500,000 per year. The company was in compliance with all financial covenants in
  its loan agreements as of August 1, 2004.
  
  CASH FLOW FROM OPERATIONS COMMENTS
  ----------------------------------
  
       Cash flow from  operations was $2.4 million for the first quarter of fiscal
  2005,  compared  with $7.9 million for the same period last year.  This decrease
  was primarily due to higher  inventory  balances and lower cash  generated  from
  accounts  receivable  balances.  For the first quarter of fiscal 2005, cash flow
  generated  from  operations,  as well as a portion of existing cash on hand, was
  used for capital  expenditures,  most of which relate to the  building  purchase
  described above.
  
  BUSINESS OUTLOOK
  ----------------
  
  Mattress  ticking  sales have  picked up during the early part of the  company's
  second  quarter.  For the  current  quarter,  management  expects  sales in this
  segment to be  moderately  ahead of second  quarter  sales last year and expects
  that operating income will  approximate  last year's level.  With respect to the
  upholstery  fabrics  segments,  the outlook  remains  uncertain  for a sustained
  recovery in retail furniture business conditions.  Management is optimistic that
  upholstery  fabric sales will also pickup in the fall, as is seasonally  typical
  in the furniture  industry.  For the second quarter,  upholstery fabrics segment
  sales are  expected to  decrease  less than the first  quarter  decline of 9.8%.
  While  management  expects to be profitable in the upholstery  fabrics  segment,
  operating income will be down considerably  from last year's second quarter.  At
  this  time,  the  company  expects to report net income in the range of $0.13 to
  $0.17 per share  diluted,  with the actual  results  depending  primarily on the
  level of demand throughout the quarter.  Management believes that the excellence
  in design  creativity,  the strength in the company's mattress ticking business,
  the company's  aggressive  expansion of its' offshore sourcing  capabilities and
  the  company's  sound  balance  sheet  effectively   position  Culp  in  today's
  marketplace.
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text: --------------------------------------------------------------------------------
  
                                   UNITED STATES
                        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) August 26, 2004
  
                                     CULP, INC.
  
              (Exact name of registrant as specified in its charter)
  
           North Carolina                  0-12781                56-1001967
  (State or other jurisdiction of   (Commission File No.)       (IRS Employer
           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)
  
  --------------------------------------------------------------------------------
  INDEX
                                      -----
  
                                                                       Page
  
  Item 2.02 -     Results of Operations and Financial                    3
                  Condition
  
  Item 9.01(c) -  Exhibits                                               3
  
  Signature                                                              4
  
  Exhibits
  Item 2.02 - Results of Operations and Financial Condition
  
  On August 26, 2004, Culp, Inc. (the "Registrant" or the "company") issued a news
  release to announce its financial  results for the first quarter ended August 1,
  2004. The news release is attached hereto as Exhibit 99(a).
  
  Also on August 26, 2004, the Registrant released a Financial Information Release
  containing   additional   financial   information  and  disclosures   about  the
  Registrant's  first  quarter  ended August 1, 2004.  The  Financial  Information
  Release is attached hereto as Exhibit 99(b).
  
  The news release and Financial  Information  Release contain  disclosures  about
  proforma  income  statement  information,  which  reconciles the reported income
  statement  information with proforma  results,  which exclude  restructuring and
  related   charges  and  credits.   The  company  has  included   this   proforma
  information in order to show  operational  performance  excluding the effects of
  restructuring  and related  charges and credits  that are not  expected to occur
  on  a  regular  basis.   Management  believes  this  presentation  aids  in  the
  comparison of financial results among comparable financial periods.
  
  Forward  Looking  Information.  This  Report and the  exhibits  attached  hereto
  contain  statements that may be deemed  "forward-looking  statements" within the
  meaning  of the  federal  securities  laws,  including  the  Private  Securities
  Litigation  Reform Act of 1995  (Section 27A of the  Securities  Act of 1933 and
  Section 27A of the  Securities  and Exchange Act of 1934).  Such  statements are
  inherently  subject  to  risks  and  uncertainties.   Further,  forward  looking
  statements  are  intended  to speak  only as of the date on which they are made.
  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 but not always  characterized  by
  qualifying words such as "expect,"  "believe,"  "estimate," "plan" and "project"
  and their  derivatives,  and  include but are not  limited to  statements  about
  expectations for the company's  future sales,  gross profit and operating income
  margins,  SG&A or other expenses and earnings.  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.  In
  addition,  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.  Also,  economic and political  instability in  international
  areas could affect the company's  operations or sources of goods in those areas,
  as well as demand for the company's products in international markets.  Finally,
  unanticipated delays or costs in executing restructuring actions could cause the
  cumulative  effect of  restructuring  actions to fail to meet the objectives set
  forth by  management.  Other factors that could affect the matters  discussed in
  forward looking  statements are included in the company's periodic reports filed
  with the Securities and Exchange Commission.
  
  Item 9.01 (c) -- Exhibits
  
  99(a)  News Release dated August 26, 2004
  
  99(b)  Financial Information Release dated August 26, 2004
  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:    Franklin  N. Saxon
                                       ------------------
                                       President and Chief Operating Officer
  
                                By:    Kenneth  R. Bowling
                                       -------------------
                                       Vice President-Finance, Treasurer
  
  Dated:  August 26, 2004
  NEWS RELEASE
  
  Investor Contact:  Kathy J. Hardy        Media Contact: Kenneth M. Ludwig
                     Corporate Secretary                  Senior Vice President,
                     336-888-6209                         Human Resources
                                                          336-889-5161
  
                  CULP ANNOUNCES FIRST QUARTER FISCAL 2005 RESULTS
  
  HIGH POINT,  N.C.  (August 26, 2004) - Culp,  Inc.  (NYSE:  CFI) today  reported
  financial  and  operating  results  for the first  quarter of fiscal  2005 ended
  August 1, 2004. The highlights include:
  
  o     Mattress  fabrics  segment  average  weekly  sales  up 2.7  percent during
        period of transition to one-sided mattresses.
  
  o     Aggressive  expansion  of  offshore  sourcing  capabilities,  resulting in
        sales of  sourced  upholstery  fabrics  more  than  doubling over the same
        period last year.
  
  o     Long-term   debt-to-capital  ratio  of  33.3  percent compared  with  44.5
        percent a year ago.
  
  o     Earnings  expectation  for the second quarter of fiscal 2005 is net income
        of $0.13 to $0.17 per diluted share.
  
  Overview
  
  For the three months ended August 1, 2004, net sales were $67.8 million compared
  with  $73.7  million a year ago, a 7.9  percent  decline.  The first  quarter of
  fiscal  2005  included 13 weeks  versus 14 weeks for the same  quarter of fiscal
  2004. The company reported a net loss of $1,052,000, or $0.09 per diluted share,
  for the first quarter of fiscal 2005  compared  with a net loss of $411,000,  or
  $0.04 per  diluted  share,  for the first  quarter  of  fiscal  2004.  Excluding
  restructuring and related charges and credits of approximately  $42,000,  net of
  income taxes,  the net loss for the first quarter of fiscal 2005 was $1,094,000,
  or $0.09 per diluted share.
  
  "Considering  one less  week's  sales,  our average  weekly  sales for the first
  fiscal  quarter  of 2005 were $5.2  million  compared  with $5.3  million in the
  prior-year  period,  a decrease of less than 1.0 percent,"  commented  Robert G.
  Culp, III,  chairman of the board and chief executive officer of Culp, Inc. "The
  first  quarter of our fiscal year is typically  the slowest  period for Culp and
  the furniture  industry with scheduled  plant vacation  shutdowns.  The seasonal
  slowdown,  combined with the continued weakness in consumer demand for furniture
  throughout  the  summer,   accounted  for  this  modest  drop.  We  believe  our
  competitive position is strong and we are excited about the growth opportunities
  in our mattress ticking business and our offshore sourcing strategy."
  
  Mattress Fabrics Segment
  
  Mattress  fabric (known as mattress  ticking) sales were $26.0 million  compared
  with $27.2 million for the first quarter of fiscal 2004, a 4.7 percent  decline.
  As noted,  these results  reflect a 13-week  period versus a 14-week period last
  year.  Average  weekly  sales for the  first  quarter  of fiscal  2005 were $2.0
  million compared with $1.9 million in the prior-year  period, an increase of 2.7
  percent.  This  increase is especially  noteworthy  considering  our  customers'
  recent transition to one-sided mattresses,  which utilize one-third less fabric.
  Operating  income for this segment was $2.9  million,  or 11.2 percent of sales,
  compared with $4.1 million, or 15.2 percent of sales, for the prior-year period.
  Operating income was primarily affected by one week's less sales for the quarter
  and inventory markdowns related to certain customer programs.  These factors are
  expected to have  significantly  less  impact on the  segment's  second  quarter
  results.
  
  Culp remarked,  "We are seeing positive trends in our mattress  ticking business
  and  continue  to  make  gains  with  key  customers.  Consumer  trends  and the
  attractiveness  of this product  category for retailers  favor further growth in
  bedding demand, and we believe that Culp is well positioned to benefit from this
  growth  as  a  leading  provider  of  mattress  ticking.  Additionally,   unlike
  upholstery  fabrics,  the mattress  fabric  business is not being  threatened by
  Asian  imports  because of the  relatively  low average  price  points and labor
  content and the just-in-time  delivery  requirements of this business.  Further,
  Asian imports of finished mattresses have been limited to less than four percent
  of the U.S.  market  because of high  shipping  costs as well as the  customized
  product lines and strong brand name recognition associated with mattresses. With
  our  leadership  in product  design,  superior  customer  service  and  delivery
  performance,  and a globally  competitive  cost  structure,  we expect  that the
  mattress  ticking  business will account for an increasing  percentage of Culp's
  overall sales and profitability in fiscal 2005."
  
  Upholstery Fabrics Segment
  
  Sales for this segment were $41.9 million,  a 9.8 percent decline  compared with
  $46.5 million in the first quarter of fiscal 2004.  Average weekly sales for the
  first quarter of fiscal 2005 were $3.2 million compared with $3.3 million in the
  prior year  period,  a decrease  of 2.9  percent.  Sales of  upholstery  fabrics
  reflect soft demand by furniture retailers during the summer months.  Additional
  factors  affecting the demand for  upholstery  fabrics are the current  consumer
  preference  for  leather  furniture  and  increased  competition  from  imported
  fabrics, including cut and sewn kits, primarily from Asia.
  
  "It has  become  increasingly  evident  that  competitive  forces in the  global
  marketplace  are  significantly  changing  the  face  of the  furniture  and the
  upholstery fabrics industries," added Culp.  "However,  we believe that Culp has
  made  significant  progress in adapting our business  model to take advantage of
  this  transition and position  ourselves more  effectively in this  environment.
  First,  we  have   significantly   adjusted  our  cost  structure  and  domestic
  manufacturing  capacity over the past several years.  Second, we have focused on
  design  creativity and product  development to provide breadth and innovation in
  the fabrics  offered to our  customers to meet  changing  consumer  preferences.
  Third,  we have  implemented a dual strategy to  aggressively  develop  offshore
  sourcing  capabilities  for Culp.  In fiscal 2003 we put in place the  necessary
  resources to begin sourcing from Asia certain  upholstery fabrics that we do not
  manufacture,  and we  have  continued  to  expand  these  resources.  The  other
  component of Culp's offshore sourcing strategy is our China operation,  where we
  are now well underway with our manufacturing operations and our fabric shipments
  to  customers.  Sales  of  upholstery  fabrics  produced  outside  of  our  U.S.
  manufacturing  plants, which include the popular micro-denier suedes and fabrics
  produced at our China facility,  accounted for  approximately  $5.5 million,  or
  13.1 percent,  of  upholstery  fabric  sales for the  quarter.  Sourced  fabrics
  accounted for  approximately  $2.1 million,  or 4.5 percent of upholstery fabric
  sales for the same period last year."
  
  Operating  loss for the  upholstery  fabrics  segment was $2.6  million,  or 6.1
  percent of sales, compared with a loss of $1.7 million, or 3.7 percent of sales,
  for the same period last year. The segment loss in each period was primarily due
  to underutilization of the company's U.S.  manufacturing  capacity.  Culp noted,
  "If sales continue to be under pressure in the upholstery  fabrics  segment,  we
  are prepared to take the necessary  actions to further adjust our cost structure
  and U.S. capacity, as we have demonstrated in recent years."
  
  Balance Sheet
  
  "One  of our  key  financial  objectives  for  fiscal  2005  is to  continue  to
  capitalize on the strength of our balance sheet," added Culp. "At the end of the
  first fiscal quarter, our balance sheet reflects  approximately $12.0 million in
  cash and cash  equivalents.  Long-term debt now stands at $51.1 million compared
  with $76.6 million a year ago. As a result, our long-term  debt-to-capital ratio
  is now 33.3 percent  compared with 44.5 percent a year ago. Our balance sheet is
  sound with  significantly  lower debt,  excellent  liquidity  and the  financial
  flexibility to pursue our strategic initiatives."
  
  Outlook
  
  Commenting  on the business  outlook,  Culp said,  "Mattress  ticking sales have
  already picked up during the early part of our second  quarter.  For the current
  quarter,  we  expect  sales in this  segment  to be  moderately  ahead of second
  quarter sales last year and expect that operating  income will  approximate last
  year's  level.  With  respect to the  upholstery  fabrics  segment,  the outlook
  remains  uncertain  for  a  sustained  recovery  in  retail  furniture  business
  conditions.  We are optimistic that upholstery fabric sales will also pick up in
  the fall, as is seasonally  typical in the  furniture  industry.  For the second
  quarter, upholstery fabrics segment sales are expected to decrease less than the
  first quarter decline of 9.8 percent. While we do expect to be profitable in the
  upholstery fabrics segment, operating income will be down considerably from last
  year's second quarter. At this time, we expect to report net income in the range
  of $0.13 to $0.17 per share diluted, with the actual results depending primarily
  on the level of demand throughout the quarter.  We believe the excellence in our
  design creativity, the strength in our mattress ticking business, the aggressive
  expansion of our offshore  sourcing  capabilities  and our sound  balance  sheet
  effectively position Culp in today's marketplace."
  
  Culp,  Inc.  is one of the world's  largest  marketers  of mattress  fabrics for
  bedding and  upholstery  fabrics for furniture.  The company's  fabrics are used
  principally in the production of bedding products and residential and commercial
  upholstered furniture.
  
  This release contains statements that may be deemed "forward-looking statements"
  within  the  meaning of the  federal  securities  laws,  including  the  Private
  Securities  Litigation  Reform Act of 1995 (Section 27A of the Securities Act of
  1933  and  Section  27A of the  Securities  and  Exchange  Act  of  1934).  Such
  statements  are  inherently  subject  to  risks  and   uncertainties.   Further,
  forward-looking  statements  are  intended to speak only as of the date on which
  they  are  made.   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 but not always
  characterized  by  qualifying  words such as  "expect,"  "believe,"  "estimate,"
  "plan" and "project" and their  derivatives,  and include but are not limited to
  statements about expectations for the company's future sales,  operating income,
  gross profit margins, SG&A or other expenses,  and earnings.  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.  In  addition,   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.  Also,  economic  and  political
  instability  in  international  areas could affect the  company's  operations or
  sources of goods in those areas, as well as demand for the company's products in
  international  markets.  Finally,  unanticipated  delays  or costs in  executing
  restructuring actions could cause the cumulative effect of restructuring actions
  to fail to meet the objectives set forth by management. Other factors that could
  affect the matters discussed in  forward-looking  statements are included in the
  company's periodic reports filed with the Securities and Exchange Commission.
  
                                     CULP, INC.
                           Condensed Financial Highlights
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net sales                                            $67,849,000  $73,676,000
                                                       ============ ============
  Net loss                                             $(1,052,000) $  (411,000)
                                                       ============ ============
  Basic and diluted net loss per share:
     Basic                                             $     (0.09) $     (0.04)
     Diluted                                           $     (0.09) $     (0.04)
                                                       ============ ============
  Average shares outstanding:
    Basic                                               11,547,000   11,515,000
    Diluted                                             11,547,000   11,515,000
  
            Reconciliation of Net Loss as Reported to Pro Forma Net Loss
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net loss, as reported                                $(1,052,000) $  (411,000)
  Restructuring and related charges (credits),
    net of income taxes                                    (42,000)          -0-
                                                       ------------ ------------
  Pro forma net loss                                   $(1,094,000) $  (411,000)
                                                       ============ ============
  
  Reconciliation of Net Loss Per Share as Reported to Pro Forma Net Loss Per Share
                                     (Unaudited)
  
                                                          Three Months Ended
                                                       -------------------------
                                                        August 1,     August 3,
                                                          2004          2003
                                                       ------------ ------------
  Net loss per share, as reported                      $     (0.09)  $    (0.04)
  Restructuring and related charges (credits),
    net of income taxes                                         -0-          -0-
                                                       ------------ ------------
  Pro forma net loss per share                         $     (0.09)  $    (0.04)
                                                       ===========  ============
  
                                     -END-
  Exhibit 99(b)
  
                      CULP, INC. FINANCIAL INFORMATION RELEASE
                           CONSOLIDATED STATEMENTS OF LOSS
            FOR THE THREE MONTHS ENDED August 1, 2004 AND August 3, 2003
  
                  (Amounts in Thousands, Except for Per Share Data)
  THREE MONTHS ENDED (UNAUDITED)
                                                    -----------------------------------------------------------------------------
                                                             Amounts                                     Percent of Sales
                                                    --------------------------                    -------------------------------
                                                     August 1,     August 3,       % Over            August 1,        August 3,
                                                       2004          2003         (Under)              2004             2003
                                                    ------------  ------------  -------------     --------------  ---------------
  Net sales                                      $       67,849        73,676       (7.9) %            100.0 %         100.0 %
  Cost of sales (1)                                      59,174        62,198       (4.9) %             87.2 %          84.4 %
                                                    ------------  ------------  -------------     --------------  ---------------
     Gross profit                                         8,675        11,478      (24.4) %             12.8 %          15.6 %
  
  Selling, general and
    administrative expenses                               9,280        10,516      (11.8) %             13.7 %          14.3 %
  Restructuring credit                                     (138)            0      100.0  %             (0.2)%           0.0 %
                                                    ------------  ------------  ----------        --------------  ---------------
     Income  (loss) from operations                        (467)          962     (148.5) %             (0.7)%           1.3 %
  
  Interest expense                                          940         1,497      (37.2) %              1.4 %           2.0 %
  Interest income                                           (27)         (122)     (77.9) %             (0.0)%          (0.2)%
  Other expense                                             214           239      (10.5) %              0.3 %           0.3 %
                                                    ------------  ------------  -------------     --------------  ---------------
     Loss before income taxes                            (1,594)         (652)    (144.5) %             (2.3)%          (0.9)%
  
  Income taxes*                                            (542)         (241)     124.9  %             34.0 %          37.0 %
                                                    ------------  ------------  -------------     --------------  ---------------
  
     Net loss                                    $       (1,052)         (411)    (156.0) %             (1.6)%          (0.6)%
                                                    ============  ============  =============     ==============  ===============
  
  Net loss per share-basic                       $        (0.09)        (0.04)    (125.0) %
  Net loss per share-diluted                     $        (0.09)        (0.04)    (125.0) %
  Net loss per share, diluted, excluding
      restructuring and related charges and
      credits (2)                                $        (0.09)        (0.04)    (125.0) %
  Average shares outstanding-basic                       11,547        11,515        0.3 %
  Average shares outstanding-diluted                     11,547        11,515        0.3 %
  *  Percent of sales column for income taxes is calculated as a % of loss before
      income taxes.
  
  (1) Cost of sales includes $75.0 of restructuring related charges for the
      three months ended August 1, 2004.
  
  (2) Reconciliation of net loss as reported to pro forma net loss:
  THREE MONTHS ENDED (UNAUDITED)
                                                            --------------------------------------------------------------------------
                                                                     Amounts                                  Percent of Sales
                                                            --------------------------                 -------------------------------
                                                             August 1,     August 3,      % Over         August 1,       August 3,
                                                               2004          2003        (Under)           2004            2003
                                                            ------------  ------------  ----------     --------------  ---------------
  Net loss, as reported                                  $    (1,052)         (411)      (156.0)%         (1.6) %          (0.6) %
  Restructuring and related charges
  (credits), net of taxes (a)                                    (42)            0        100.0 %         (0.1) %           0.0  %
                                                            ------------  ------------  ----------     --------------  ---------------
     Proforma net loss                                        (1,094)         (411)      (166.2)%         (1.6) %          (0.6) %
  
  Pro forma net loss per share-basic                     $     (0.09)        (0.04)      (125.0)%
  Pro forma net loss per share-diluted                   $     (0.09)        (0.04)      (125.0)%
  
  (a) Represents the $138.0 restructuring credit, offset by the $75.0 in
      restructuring related charges, net of taxes to arrive at $42.0.
  CULP, INC. FINANCIAL INFORMATION RELEASE
                             CONSOLIDATED BALANCE SHEETS
                   AUGUST 1, 2004, AUGUST 3, 2003 AND MAY 2, 2004
                                      Unaudited
                               (Amounts in Thousands)
  Amounts                     Increase
                                                ---------------------------         (Decrease)
                                                 August 1,      August 3,    -------------------------   * May 2,
                                                    2004          2003        Dollars     Percent          2004
                                                -------------  ------------  ----------- -------------  -----------
  Current assets
     Cash and cash equivalents                $       11,946        15,094       (3,148)     (20.9)%        14,568
     Short-term investments                                0        15,014      (15,014)    (100.0)%             0
     Accounts receivable                              24,242        24,227           15        0.1 %        30,719
     Inventories                                      52,083        49,275        2,808        5.7 %        49,045
     Deferred income taxes                             9,256        12,303       (3,047)     (24.8)%         9,256
     Other current assets                              1,645         4,001       (2,356)     (58.9)%         1,634
                                                -------------  ------------  ----------- -------------  -----------
                   Total current assets               99,172       119,914      (20,742)     (17.3)%       105,222
  
  Property, plant & equipment, net                    78,880        83,299       (4,419)      (5.3)%        77,770
  Goodwill                                             9,240         9,240            0        0.0 %         9,240
  Other assets                                         1,307         1,934         (627)     (32.4)%         1,496
                                                -------------  ------------  ----------- -------------  -----------
  
                   Total assets               $      188,599       214,387      (25,788)     (12.0)%       193,728
                                                =============  ============  =========== =============  ===========
  
  Current liabilities
     Current maturities of long-term debt     $          545           517           28        5.4 %           528
     Accounts payable                                 14,857        18,648       (3,791)     (20.3)%        15,323
     Accrued expenses                                 10,880        12,856       (1,976)     (15.4)%        13,028
     Accrued restructuring                             4,656         7,141       (2,485)     (34.8)%         4,968
     Income taxes payable                                606             0          606      100.0 %         1,850
                                                -------------  ------------  ----------- ----------     -----------
                   Total current liabilities          31,544        39,162       (7,618)     (19.5)%        35,697
  
  Long-term debt , less current maturities            50,519        76,034      (25,515)     (33.6)%        50,502
  
  Deferred income taxes                                4,138         3,851          287        7.5 %         4,138
                                                -------------  ------------  ----------- -------------  -----------
                   Total liabilities                  86,201       119,047      (32,846)     (27.6)%        90,337
  
  Shareholders' equity                               102,398        95,340        7,058        7.4 %       103,391
                                                -------------  ------------  ----------- -------------  -----------
  
                   Total liabilities and
                   shareholders' equity       $      188,599       214,387      (25,788)     (12.0)%       193,728
                                                =============  ============  =========== =============  ===========
  
  Shares outstanding                                  11,548        11,515           33        0.3 %        11,547
                                                =============  ============  =========== =============  ===========
  * Derived from audited financial statements
  CULP, INC. FINANCIAL INFORMATION RELEASE
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
            FOR THE THREE MONTHS ENDED AUGUST 1, 2004 AND AUGUST 3, 2003
  
                                      Unaudited
                               (Amounts in Thousands)
  THREE MONTHS ENDED
                                                                         --------------------------
                                                                                  Amounts
                                                                         --------------------------
                                                                          August 1,     August 3,
                                                                            2004          2003
                                                                         ------------  ------------
  Cash flows from operating activities:
      Net loss                                                         $      (1,052)         (411)
      Adjustments to reconcile net loss to net cash
         provided by operating activities:
            Depreciation                                                       3,362         3,444
            Amortization of other assets                                          37            45
            Stock-based compensation                                              52            53
            Restructuring credit                                                (138)            0
            Changes in assets and liabilities:
               Accounts receivable                                             6,477         8,032
               Inventories                                                    (3,038)          277
               Other current assets                                              (11)         (797)
               Other assets                                                      206           256
               Accounts payable                                                  112          (845)
               Accrued expenses                                               (2,148)       (1,215)
               Accrued restructuring                                            (228)         (602)
               Income taxes payable                                           (1,244)         (349)
                                                                         ------------  ------------
                  Net cash provided by operating activities                    2,387         7,888
                                                                         ------------  ------------
  
  Cash flows from investing activities:
      Capital expenditures                                                    (4,375)       (1,875)
      Purchases of short-term investments                                          0        (5,038)
                                                                         ------------  ------------
                  Net cash used in investing activities                       (4,375)       (6,913)
                                                                         ------------  ------------
  
  Cash flows from financing activities:
      Payments on vendor-financed capital expenditures                          (675)         (287)
      Proceeds from issuance of long-term debt                                    34            51
      Proceeds from common stock issued                                            7             0
                                                                         ------------  ------------
                  Net cash used in financing activities                         (634)         (236)
                                                                         ------------  ------------
  
  Increase (decrease) in cash and cash equivalents                            (2,622)          739
  
  Cash and cash equivalents at beginning of period                            14,568        14,355
                                                                         ------------  ------------
  
  Cash and cash equivalents at end of period                          $       11,946        15,094
                                                                         ============  ============
  CULP, INC. FINANCIAL INFORMATION RELEASE
                                 FINANCIAL ANALYSIS
                                   August 1, 2004
  FISCAL 04                     FISCAL 05
                                         -----------------  --------------------------------------
                                                  Q1              Q1       Q2        Q3      Q4
                                         -----------------  --------------------------------------
  INVENTORIES
     Inventory turns                              5.0            4.7
  
  RECEIVABLES
     Days sales in receivables                     32             30
  
  WORKING CAPITAL
     Current ratio                                3.1            3.1
     Operating working capital turnover (1)       5.1            5.1
     Operating working capital (1)            $54,854        $61,468
  
  PROPERTY, PLANT & EQUIPMENT
     Depreciation rate                           6.2%           6.1%
     Percent property, plant &
       equipment are depreciated                62.3%          64.2%
     Capital expenditures                      $6,747 (2)     $4,543
  
  LEVERAGE
     Total liabilities/equity                  124.7%          84.2%
     Long-term debt/equity                      80.3%          49.9%
     Long-term debt/capital employed (3)        44.5%          33.3%
     Long-term debt                           $76,551        $51,064
  
  OTHER
     Book value per share                       $8.28          $8.87
     Employees at quarter end                   2,383          2,235
     Sales per employee (annualized)         $121,628       $119,190
     Capital employed (3)                    $171,891       $153,462
  
    (1) Working capital for this calculation is accounts receivable, inventories
        and accounts payable.
    (2) Expenditures for entire year.
    (3) Capital employed represents long-term debt plus stockholders equity; Long-
        term debt is long-term debt plus current maturities of of long-term debt.
  CULP, INC. FINANCIAL INFORMATION RELEASE
         SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT/DIVISION
            FOR THE THREE MONTHS ENDED AUGUST 1, 2004 AND AUGUST 3, 2003
  
                               (Amounts in thousands)
  THREE MONTHS ENDED (UNAUDITED)
                                                 ------------------------------------------------------------------
                                                       Amounts                           Percent of Total Sales
                                                 ---------------------              ------------------------------
                                                 August 1,   August  3,   % Over     August 1,       August 3,
  Net Sales by Segment                             2004        2003       (Under)      2004            2003
  ---------------------------------------------  ----------  ---------  ----------  -------------  ---------------
  Mattress Fabrics
       Culp Home Fashions                      $    25,953     27,220      (4.7) %         38.3 %          36.9 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Upholstery Fabrics
      Culp Decorative Fabrics                       23,919     29,617     (19.2) %         35.3 %          40.2 %
      Culp Velvets/Prints                           17,977     16,839       6.8  %         26.5 %          22.9 %
                                                 ----------  ---------  ----------  -------------  ---------------
                                                    41,896     46,456      (9.8) %         61.7 %          63.1 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
       Net Sales                               $    67,849     73,676      (7.9) %        100.0 %         100.0 %
                                                 ==========  =========  ==========  =============  ===============
  
  Gross Profit by Segment                                                                 Gross Profit Margin
  ---------------------------------------------                                     ------------------------------
  
  Mattress Fabrics                             $     4,794      6,072     (21.0) %         18.5 %          22.3 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Pro forma Upholstery Fabrics                       3,956      5,406     (26.8) %          9.4 %          11.6 %
      Restructuring related charges (1)                 75          0     100.0  %          0.2 %           0.0 %
                                                 ----------  ---------  ----------  -------------  ---------------
  Upholstery Fabrics gross profit                    3,881      5,406     (28.2) %          9.3 %          11.6 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
       Gross Profit                            $     8,675     11,478     (24.4) %         12.8 %          15.6 %
                                                 ==========  =========  ==========  =============  ===============
  
  Operating Income (loss)  by Segment                                                Operating Income (Loss) Margin
  ---------------------------------------------                                     ------------------------------
  
  Mattress Fabrics                             $     2,899      4,144     (30.0) %         11.2 %          15.2 %
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Pro forma Upholstery Fabrics                      (2,619)    (1,719)    (52.4) %         (6.3)%          (3.7)%
       Restructuring and related charges
       and credits (1)                                  63          0     100.0  %          0.2 %           0.0 %
                                                 ----------  ---------  ----------  -------------  ---------------
  Upholstery Fabrics operating loss                 (2,556)    (1,719)    (48.7) %         (6.1)%          (3.7)%
                                                 ----------  ---------  ----------  -------------  ---------------
  
  Unallocated corporate expenses                      (810)    (1,463)     44.6  %         (1.2)%          (2.0)%
                                                 ----------  ---------  ----------  -------------  ---------------
  
       Operating income (loss)                 $      (467)       962    (148.5) %         (0.7)%           1.3 %
                                                 ==========  =========  ==========  =============  ===============
  
  Depreciation by Segment
  ---------------------------------------------
  Mattress Fabrics                             $       916        944      (3.0) %
  Upholstery Fabrics                                 2,446      2,499      (2.1) %
                                                 ----------  ---------  ----------
  Total Depreciation                           $     3,362      3,444      (2.4) %
                                                 ==========  =========  ==========
  
  (1)  Restructuring and related charges include a credit of $138.0 for the
       reversal of certain accrued expenses, offset by $75.0 in equipment
       dismantling charges; both related to the closing of the Lumberton
       manufacturing facility.
  CULP, INC. FINANCIAL INFORMATION RELEASE
             SALES, GROSS PROFIT AND OPERATING INCOME (LOSS) BY SEGMENT
                        FOR THE FISCAL YEAR ENDED MAY 2, 2004
  
                                     (UNAUDITED)
                               (Amounts in thousands)
  Net Sales by Segment
  ----------------------------------
                                          QTR 1                 QTR 2                 QTR 3             QTR 4
                                 --------------------  -------------------  -------------------  -----------------
                                 August 3,    % of     November 2,   % of   February 1,   % of    May 2,    % of      Fiscal    % of
                                   2003       Sales       2003       Sales    2004        Sales    2004     Sales      2004     Sales
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  Mattress Fabrics
       Culp Home Fashions       $   27,220     36.9%      26,788    32.4%     25,114     32.8%   27,200     31.9%    106,322    33.4%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Upholstery Fabrics
      Culp Decorative Fabrics       29,617     40.2%      32,459    39.2%     29,678     38.8%   32,519     38.2%    124,273    39.1%
      Culp Velvets/Prints           16,839     22.9%      23,484    28.4%     21,769     28.4%   25,429     29.9%     87,521    27.5%
                                 ----------  --------  ----------  -------  ---------  --------  --------  -------  ---------  -------
  
                                    46,456     63.1%      55,943    67.6%     51,447     67.2%   57,948     68.1%    211,794    66.6%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Net Sales                $   73,676    100.0%      82,731   100.0%     76,561    100.0%   85,148    100.0%    318,116   100.0%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  Gross Profit by Segment
  ----------------------------------
  
  Mattress Fabrics              $    6,072     22.3%       6,329    23.6%      5,093     20.3%    5,883     21.6%     23,377    22.0%
  
  Upholstery Fabrics                 5,406     11.6%      10,409    18.6%      9,375     18.2%    9,755     16.8%     34,945    16.5%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Gross profit             $   11,478     15.6%      16,738    20.2%     14,468     18.9%   15,638     18.4%     58,322    18.3%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  Operating Income (loss) by Segment
  ----------------------------------
  
  Mattress Fabrics              $    4,144     15.2%       4,247    15.9%      3,039     12.1%    3,555     13.1%     14,985    14.1%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Pro forma Upholstery Fabrics      (1,719)    -3.7%       3,452     6.2%      2,260      4.4%    2,844      4.9%      6,837     3.2%
      Restructuring credit               0      0.0%           0     0.0%          0      0.0%   (1,047)    -1.8%     (1,047)   -0.5%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  Upholstery Fabrics operating
      income (loss)                 (1,719)    -3.7%       3,452     6.2%      2,260      4.4%    3,891      6.7%      7,884     3.7%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
  Unallocated corporate expenses    (1,463)    -2.0%      (1,257)   -1.5%     (1,113)    -1.5%     (686)    -0.8%     (4,519)   -1.4%
                                 ----------  --------  ----------  -------  ---------  --------  -------  --------  ---------  -------
  
       Operating income         $      962      1.3%       6,442     7.8%      4,186      5.5%    6,760      7.9%     18,350     5.8%
                                 ==========  ========  ==========  =======  =========  ========  =======  ========  =========  =======
  
  Depreciation by Segment
  ----------------------------------
  
  Mattress Fabrics              $      944                  942                  937               930                3,753
  Upholstery Fabrics                 2,499                2,498                2,476             2,417                9,889
                                 ----------            ----------           ---------           -------             ---------
  Total Depreciation            $    3,444                3,439                3,412             3,348               13,642
                                 ==========            ==========           =========           =======             =========
  CULP, INC. FINANCIAL INFORMATION RELEASE
                                 FINANCIAL NARRATIVE
            for the three months ended August 1, 2004 and August 3, 2003
  
  OVERVIEW
  
  Highlights for the first quarter ended August 1, 2004 , include:
  
  o     Mattress  fabrics  segment  average  weekly  sales  up 2.7 percent  during
        period of transition to one-sided mattresses.
  
  o     Aggressive  expansion  of  offshore  sourcing  capabilities,  resulting in
        sales  of sourced  upholstery fabrics  more than  doubling over  the  same
        period last year.
  
  o     Long-term debt-to-capital ratio of 33.3% compared with 44.5% a year ago.
  
  o     Earnings  expectation for the second  quarter of fiscal 2005 is net income
        of $0.13 to $0.17 per diluted share.
  
  GENERAL - The first quarter of the fiscal year is typically  the slowest  period
  for the company and the  furniture  industry  due to  scheduled  plant  vacation
  shutdowns.  The  seasonal  slowdown,  combined  with the  continued  weakness in
  consumer demand for furniture  throughout the summer,  accounted for this modest
  drop. In addition,  the first quarter of fiscal 2005 included 13 weeks versus 14
  weeks for the same period of fiscal 2004.  For the first quarter of fiscal 2005,
  net sales  decreased 7.9% to $67.8  million.  Average weekly sales for the first
  quarter of fiscal 2005 were $5.2 million compared with $5.3 million in the prior
  year period,  a decrease of less than 1.0%.  The company  reported a net loss of
  $1,052,000, or $0.09 per share diluted, compared with a net loss of $411,000, or
  $0.04 per  share  diluted,  in the  first  quarter  of  fiscal  2004.  Excluding
  restructuring and related charges and credits of approximately  $42,000,  net of
  income taxes, the net loss for the quarter was $1,094,000.  These results are in
  line with the  previously  announced  guidance of an  expected  loss of $0.08 to
  $0.13 per share.
  
  STATEMENT OF OPERATIONS COMMENTS
  
       MATTRESS FABRICS SEGMENT (See page 5 - Sales, Gross Profit and Operating
       Income (Loss) by Segment)
  
       Net Sales -- Mattress  fabric  sales  (known as mattress  ticking)  for the
  first quarter of fiscal 2005 decreased 4.7% to $26.0 million compared with $27.2
  million for the same period a year ago. As noted above,  these results reflect a
  13 week period versus a 14 week period last year.  Average  weekly sales for the
  first quarter of fiscal 2005 were $2.0 million compared with $1.9 million in the
  prior year  period,  an increase of 2.7%.  While sales,  on a comparable  basis,
  continue  to be  affected  by the  recent  customers'  transition  to  one-sided
  mattresses,  which utilize  one-third less fabric,  the mattress ticking segment
  experienced higher sales, on an average weekly basis, by expanding business with
  certain key accounts.  Also,  mattress  manufacturers  are  currently  incurring
  higher  costs for other  mattress  components,  such as steel,  as well as costs
  associated  with flame  retardant  requirements.  As a result of these increased
  costs,  mattress  manufacturers  are  placing  additional  pressure  on mattress
  ticking prices,  and in some instances  manufacturers are moving to lower priced
  ticking.
  
  Mattress  ticking  yards sold during the first  quarter of fiscal 2005 were 10.8
  million  compared with 10.5 million yards in the first quarter of last year. The
  average  selling  price was $2.38 per yard for the first  quarter,  compared  to
  $2.57 per yard in the same quarter last year, a decrease of 7.4%.
  
       Operating  income -- For the first  quarter of fiscal  2005,  the  mattress
  fabrics segment reported  operating  income of $2.9 million,  or 11.2% of sales,
  compared  with $4.1  million,  or 15.2% of sales,  for the  prior  year  period.
  Operating  income was  primarily  impacted by fewer  sales  weeks and  inventory
  markdowns  related to certain customer  programs.  These factors are expected to
  have significantly less impact on the segment's second quarter results.
  
       UPHOLSTERY FABRICS SEGMENT (See page 5 - Sales, Gross Profit and Operating
       Income (Loss) by Segment)
  
       Net Sales --  Upholstery  fabric sales for the first quarter of fiscal 2005
  decreased  9.8% to $41.9  million when  compared to the first  quarter of fiscal
  2004.  Average  weekly  sales for the  first  quarter  of fiscal  2005 were $3.2
  million compared with $3.3 million in the prior year period, a decrease of 2.9%.
  The lower sales primarily reflect soft demand by furniture retailers, as well as
  current consumer preference for leather furniture and increased competition from
  imported fabrics, including cut and sewn kits, primarily from Asia.
  
  With the company's offshore sourcing efforts,  including the China platform, the
  company is  experiencing  higher sales of upholstery  fabric  products  produced
  outside of the company's U.S.  manufacturing  plants. These sales, which include
  microdenier suedes and fabrics produced at the company's China plant,  increased
  162% over the prior year period and accounted for approximately $5.5 million, or
  13.1% of upholstery  fabric sales for the quarter.  Offshore  sourced fabrics of
  $2.1 million accounted for approximately 4.5% of upholstery fabric sales for the
  same period last year.
  
  Upholstery  fabric yards sold during the first  quarter were 9.3 million  versus
  10.6 million in the first  quarter of fiscal  2004, a decline of 12.3%.  Average
  selling price was $4.25 per yard for the first  quarter  compared with $4.13 per
  yard in the same  quarter  of last  year,  an  increase  of 2.9%,  due to higher
  average selling prices in both the CDF and CVP divisions.
  
       Operating  income (loss) -- Operating  loss for the first quarter of fiscal
  2005 was $2.6 million,  or 6.1% of sales,  compared with a loss of $1.7 million,
  or 3.7% of sales, for the same period last year. The segment loss in each period
  was  primarily  due to  underutilization  of the  company's  U.S.  manufacturing
  capacity.  If sales  continue  to be under  pressure in the  upholstery  fabrics
  segment,  management is prepared to take the necessary actions to further adjust
  the company's cost structure and U.S. capacity,  as the company has demonstrated
  in recent years.
  
       SG&A  EXPENSES -- SG&A  expenses of $9.3  million for the first  quarter of
  fiscal 2005 decreased  approximately $1.2 million, or 11.8%, from the prior year
  amount. As a percent of net sales,  SG&A expenses  decreased to 13.7% from 14.3%
  the previous year, due mostly to lower professional fees.
  
       Unallocated Corporate Expenses - The unallocated corporate expense category
  includes  certain items that have not been  allocated to the company's  segments
  (see Page 5 - Sales and Gross  Profit/Operating  Income (Loss) by Segment).  The
  major  components of unallocated  corporate  expenses  include  compensation and
  benefits for certain executive  officers and all costs related to being a public
  company.  For the first quarter of fiscal 2005,  unallocated  corporate expenses
  totaled  $810,000  compared  with $1.5  million  for the same  period last year,
  reflecting a substantial decrease in professional fees.
  
       INTEREST  EXPENSE AND  INTEREST  INCOME --  Interest  expense for the first
  quarter  declined to $940,000  from $1.5 million the previous  year due to lower
  borrowings  outstanding.  Interest income decreased to $27,000 from $122,000 the
  previous year due to lower invested balances in fiscal 2005.
  
       INCOME TAXES -- The  effective  tax rate (taxes as a  percentage  of pretax
  income  (loss))  for the first  quarter of fiscal 2005 was 34.0%  compared  with
  37.0% for the same period last year.
  
  BALANCE SHEET COMMENTS
  ----------------------
  
       CASH AND CASH  EQUIVALENTS - Cash and cash equivalents as of August 1, 2004
  decreased  to $11.9  million  from  $14.6  million  at the end of  fiscal  2004,
  primarily  reflecting  cash flow from  operations  of $2.4  million  and capital
  expenditures  and  payments  on vendor  financed  capital  expenditures  of $5.0
  million.
  
       WORKING CAPITAL -- Accounts  receivable as of August 1, 2004 increased 0.1%
  from the year-earlier level. Days sales outstanding totaled 30 days at August 1,
  2004  compared  with 32 days a year ago.  Inventories  at the close of the first
  quarter  increased 5.7% from a year ago.  Inventory  turns for the first quarter
  were 4.7 versus  5.0 for the  year-earlier  period.  Operating  working  capital
  (comprised of accounts receivable and inventories,  less trade accounts payable)
  was $61.5 million at August 1, 2004, up from $54.9 million a year ago.
  
       PROPERTY,  PLANT AND EQUIPMENT -- Capital spending for the first quarter of
  fiscal  2005 was $4.5  million,  including  approximately  $3.9  million for the
  purchase of a building that will serve as the  company's  new corporate  offices
  and as new space for the  company's  showrooms.  The company  expects the annual
  operating costs of the new building to be significantly lower than the lease and
  related costs associated with the current facilities. Depreciation for the first
  quarter was $3.4 million,  and is estimated at $13.5 million for the full fiscal
  year.  For fiscal  2005,  the company  anticipates  capital  expenditures  to be
  approximately $9.0 million, including the $5.7 million budgeted for the building
  purchase and related renovations.
  
       INTANGIBLE  ASSETS -- As of August 1, 2004, $9.2 million in goodwill is the
  company's  only  intangible  asset.  This  goodwill is comprised of $4.1 million
  related to the mattress  fabrics  segment,  and $5.1 million related to the Culp
  Decorative Fabrics division within the upholstery fabrics segment.
  
       LONG-TERM  DEBT  -- The  company's  long-term  debt  of  $51.1  million  is
  unsecured and is comprised of $50.0 million in outstanding  senior notes, with a
  fixed interest rate of 7.76%, and a $1.1 million, non-interest bearing term loan
  with the  Canadian  government.  Additionally,  the company has a $15.0  million
  revolving  credit line with a bank, of which no balance is outstanding at August
  1, 2004.  The current bank  agreement,  which  expires in August 2004,  has been
  extended to August  2005.  The first  scheduled  principal  payment on the $50.0
  million  senior  notes is due  March  2006 in the  amount of $7.5  million.  The
  Canadian  government  loan is  repaid in annual  installments  of  approximately
  $500,000 per year. The company was in compliance with all financial covenants in
  its loan agreements as of August 1, 2004.
  
  CASH FLOW FROM OPERATIONS COMMENTS
  ----------------------------------
  
       Cash flow from  operations was $2.4 million for the first quarter of fiscal
  2005,  compared  with $7.9 million for the same period last year.  This decrease
  was primarily due to higher  inventory  balances and lower cash  generated  from
  accounts  receivable  balances.  For the first quarter of fiscal 2005, cash flow
  generated  from  operations,  as well as a portion of existing cash on hand, was
  used for capital  expenditures,  most of which relate to the  building  purchase
  described above.
  
  BUSINESS OUTLOOK
  ----------------
  
  Mattress  ticking  sales have  picked up during the early part of the  company's
  second  quarter.  For the  current  quarter,  management  expects  sales in this
  segment to be  moderately  ahead of second  quarter  sales last year and expects
  that operating income will  approximate  last year's level.  With respect to the
  upholstery  fabrics  segments,  the outlook  remains  uncertain  for a sustained
  recovery in retail furniture business conditions.  Management is optimistic that
  upholstery  fabric sales will also pickup in the fall, as is seasonally  typical
  in the furniture  industry.  For the second quarter,  upholstery fabrics segment
  sales are  expected to  decrease  less than the first  quarter  decline of 9.8%.
  While  management  expects to be profitable in the upholstery  fabrics  segment,
  operating income will be down considerably  from last year's second quarter.  At
  this  time,  the  company  expects to report net income in the range of $0.13 to
  $0.17 per share  diluted,  with the actual  results  depending  primarily on the
  level of demand throughout the quarter.  Management believes that the excellence
  in design  creativity,  the strength in the company's mattress ticking business,
  the company's  aggressive  expansion of its' offshore sourcing  capabilities and
  the  company's  sound  balance  sheet  effectively   position  Culp  in  today's
  marketplace.