Good morning, and welcome to the Culp, Inc. third quarter fiscal year 2023 earnings conference call. All participants will be in a listen-only mode today. Should you need any assistance during the call, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note that this event is being recorded today. I would now like to turn the conference over to Dru Anderson. Please go ahead. Thank you. Good morning, and welcome to the Culp conference call to review the company's results for the third quarter of fiscal 2023. As we start, let me state that this morning's call will contain forward-looking statements about the business, financial condition, and prospects of the company. Forward-looking statements are statements that include projections, expectations, or beliefs about future events or results or otherwise are not statements of historical fact. The actual performance of the company could differ materially from that indicated by the forward-looking statements because of various risks and uncertainties. These risks and uncertainties are described in our regular SEC filings, including the company's most recent filings on Form 10-K and Form 10-Q. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations and financial results. You are cautioned not to place undue reliance on forward-looking statements made today. Each such statement speaks only as of today. We undertake no obligation to update or revise forward-looking statements. In addition, during this call, the company will be discussing non-GAAP financial measurements. A reconciliation of these non-GAAP financial measurements to the most directly comparable GAAP financial measurement is included in the tables to the press release, included as an exhibit to the company's 8-K filed yesterday and posted on the company's website at culp.com. A slide presentation with supporting summary financial information is also available on the company's website as part of the webcast of today's call. I will now turn the call over to Iv Culp, President and Chief Executive Officer of Culp. Please go ahead, sir. Good morning, and thank you for joining us today. I would like to welcome you to the Culp quarterly conference call with analysts and investors. With me on the call today are Ken Bowling, Chief Financial Officer, and Boyd Chumbley, President of our Upholstery Fabrics business. A few housekeeping items. First, I wanna let you all know that Tommy Bruno, President of our Mattress Fabrics business, is unable to join us on the call today as he is traveling and working on the business, but we do plan to have him join us next quarter. Wanna point out that we have not posted our usual investor presentation or capital allocation strategy deck on our website as we are preparing a new, refreshed investor presentation and improvement roadmap, which we expect to share within the next few weeks. Lastly, I wanna quickly thank our 1,400 employees around the world for their dedication and hard work over these challenging times. Our culture at Culp is special, and we are really proud of our associates. We are also grateful to have been awarded the HEARTS Award from the Dallas Market Center and Accessories Resource Team, with nomination from the International Textile Alliance. We are honored to be recognized for our heart-based leadership. I'll now begin the call with some opening comments, including a discussion of key themes for the quarter and priorities as we look ahead. After that, Ken will review the financial results for the quarter, and I'll then review our business outlook for the fourth quarter, and we'll then take some questions. When we think about the third quarter, there are really three major themes. Number one, current weak demand within the two industries we service. Number two is our focus on maintaining a strong balance sheet and managing our cash position. Number three, the transformation within our CHF Mattress Fabrics business. Regarding theme one, on the demand side, our sales and operating results for the quarter reflect a continued weakness in the domestic mattress and residential home furnishings industries, especially related to unit volume. With sales at these levels, it is a very tough environment for Culp to thrive despite our market gains. We are a unit-driven company, and in the absence of solid furniture and bedding units being sold within the industry, it is challenging for us to run our facilities and manage our supply chain efficiently. Now, there's certainly much to complain about regarding macro conditions and inflationary pressures affecting consumer spending. Those are things that are out of our control and that are definitely pressuring demand. It goes deeper than that for Culp, and the impacts are different by business segment. Our Upholstery Fabric Segment has experienced a continued lag in residential business due to high inventory levels that are still being worked through and managed at manufacturers and retailers. We expect that could take a few more months to normalize. Our Mattress Fabric Segment, this business seems to be caught in a temporary industry malaise, with some reports of mattress unit sales currently down as much as 25%. Within this tough demand backdrop, we are controlling what we can control in managing our business, including making strategic adjustments and working to expand our market position. We believe the slack will come out of the supply chain at some point and macro conditions will stabilize. When that occurs, we are extremely well-positioned and expect much better results. Let me turn to theme two, which is continuing to manage a strong balance sheet and manage our cash position. This is one of the main things we can control. I'm very pleased with our management teams in both of our businesses for their diligence in maintaining our solid financial position. We have done an excellent job with inventory reductions with a favorable cash impact of $18.2 million since the end of the third quarter of last fiscal year. We have also managed accounts receivable effectively by improving our terms with key customers and navigating three major bankruptcies without any material impact. Additionally, we have generated positive cash flow for the first nine months of this fiscal year, a significant improvement compared to last year, and we now expect to end this fiscal year with a cash level comparable to the end of last fiscal year. This is outstanding cash management and preservation in the face of very challenging times. Importantly, we also have no outstanding debt, and we have entered into a new asset-based revolving credit facility that enhances our liquidity position if we ever need it. We fully recognize that management of Culp's strong balance sheet is paramount to our future success. The third key theme for us, both for the quarter and as we look ahead, is the business transformation underway in Culp Home Fashions, our mattress fabric segment. This certainly falls within the scope of areas we can control, and we recognize that CHF Mattress Fabrics is the business that needs our most immediate attention. This is where we believe the majority of our value exists and what we think is our best opportunity for growth from current levels. Our CHF Mattress Fabrics business is executing a transformation plan in every facet of the business, from processes to people. This business possesses a rich history with an excellent reputation and a strong global platform. While our market position remains solid, we have struggled through extremely volatile demand periods over the last two years, and we have needed better cost control and pricing, as well as better overall discipline. We are in the process of transforming those areas, among others, under the leadership of new division president Tommy Bruno, and we believe that engaging in this holistic business improvement strategy will position us to emerge even stronger when conditions normalize. I am overwhelmingly pleased with the new leadership under Tommy as he brings an ideal mix of energy, strategic thinking, and experience in the mattress industry. In Tommy's short time with CHF, and as reflected in our numerous recent announcements to trade publications and on our social media channels, we have already made excellent progress with getting the right people in the right places, including new managers in sales, customer service, operations, and manufacturing. We are focusing on production efficiency, quality management, and balancing our product mix to proper volume SKUs and steady run schedules. We have an intensive focus on improving our operational excellence. We are also noting now some raw material price improvement, although as we previously disclosed, we are still lagging somewhat in our price cost structure for existing products. Some good news is we are winning new business and gaining market position. Our new opportunities are priced in line with current market costs. It was also very encouraging to see the activity level at the January Las Vegas Market. The industry has previously been in a cycle of deferring new product introductions, which affects our unit volume. We were pleased to see many new products and innovations presented at this market featuring Culp mattress fabrics and sewn covers that are launching throughout calendar 2023. Looking ahead, we expect all of these elements will be the building blocks for steady sequential improvement in the CHF business, though notably the pace of our improvement will be dictated by overall macro industry demand. We are working diligently to regain profitability in fiscal 2024. We do expect that CHF Mattress Fabrics will lead that recovery. Regarding our Upholstery Fabrics business, despite the elevated inventory levels affecting demand for our residential fabric products, we remain well positioned for the long term with our scalable global platform and innovative product offerings, including the popular portfolio of LiveSmart performance products. Our Upholstery Fabrics business has generally been more stable over the last two years in market volatility, supported in part by our hospitality contract business over the last year following its recovery from COVID impacts. Hospitality contract accounted for approximately 30% of the segment sales for the third quarter. While this percentage is higher than normal due to lower residential sales, it does reflect the ongoing solid performance of our hospitality contract business, as well as the importance to our overall strategy of product diversification for this segment. We also took some action during the quarter to align our upholstery cut and sew platform in Haiti with current demand trends. While this did result in some restructuring charges, we were able to accomplish this adjustment without sacrificing our ability to support customers and grow our cut and sew business. Ken's gonna go into more detail on this in his review of divisional performance, but I'm pleased that we will have a go-forward annualized savings from this action, and we will recoup a majority of our prepaid rent costs over time. Also want to be very clear that we still view Haiti as a critical near-shore location for Culp. We have a strong mattress cover platform running in Haiti, and we expect Haiti to be an important part of the company's future for cut-and-sewn mattress kits and covers. I'll now turn the call over to Ken, who will review the financial results for the quarter, and then I'll come back and review the outlook for the fourth quarter of this fiscal year. Ken? Thanks, Steve. As mentioned earlier on the call, we have posted a slide presentation to our investor relations website that covers certain summary financial information, and we will also post a new investor presentation in the upcoming weeks. Here are the financial highlights for the third quarter. Net sales were $52.5 million, down 34.6% compared with the prior year period. The company reported a loss from operations of $7.8 million compared with income from operations of $1.1 million for the prior year period. The loss from operations for the quarter includes $711,000 in restructuring expense relating to the rationalization of the upholstery fabric segment's cut-and-sew platform in Haiti that Iv mentioned earlier. I'll comment in more detail on divisional sales and operating performance in a moment, including more on this rationalization. Net loss for the third quarter was $9 million, or $0.73 per diluted share, compared with net loss of $289,000, or $0.02 per diluted share for the prior year period. Our overall operating performance for the third quarter was primarily affected by operating inefficiencies due to lower sales and holiday shutdowns affecting both of our businesses, operating inefficiencies in our Upholstery Fabrics segment's cut-and-sew facility in Haiti, and in our Read Window Products business, and restructuring charges associated with our Upholstery Fabrics segment. Overall performance for the third quarter was also affected by $1.1 million in other expense, up from $322,000 for the prior year period, due primarily to unfavorable foreign exchange rates associated with our operations in China. Notably, performance for the nine-month year-to-date period was favorably affected by foreign exchange rates associated with our China operations. SG&A expense for the quarter was also higher than prior year period, due mostly to last year's reversal of accrued bonus and accrued stock compensation expense during the period. The effective income tax rate for the third quarter of this fiscal year was a negative 3.3%, compared with 129% for the same period a year ago. Our effective income tax rate for the third quarter of this fiscal year was affected by the company's mix of earnings between our U.S. and foreign subsidiaries. Our cash income tax payments totaled $1.9 million for the first nine months of this fiscal year, and we currently expect cash income tax payments of $3.1 million for the entire fiscal 2023 year. Importantly, our estimated cash income tax payments for this fiscal year are management's current projections only and can be affected by a variety of factors over the course of the year. Now let's take a look at our business segments. For the Mattress Fabrics segment, sales for the third quarter were $24.7 million, down 35.8% compared with last year's third quarter, and down 5.8% compared sequentially with the second quarter of this fiscal year. Sales for the quarter were pressured by reduced demand, with mattress industry analysis reflecting significant unit contraction. The impact of this industry softness was heightened as mattress manufacturers took longer than normal holiday shutdowns, resulting in fewer billing days. Manufacturers and retailers also continued to work through excess inventory, delaying the timing of shipments and new product rollouts. We did begin the rollout of some new customer programs near the end of the quarter. These new programs are priced in line with current market costs, we expect to benefit as they expand across more sales channels and retail floors, and as additional new product rollouts launch during this calendar year. Operating loss for the quarter was $4.2 million, compared with operating income of $364,000 a year ago. Our operating performance for the third quarter this year was primarily pressured by operating inefficiencies driven by lower sales volume and holiday shutdowns across our Mattress Fabrics locations. For the Upholstery Fabrics segment, sales for the third quarter were $27.8 million, down 33.5% over the prior year, which was the segment's strongest quarterly sales performance since 2006. Sequentially, sales for the upholstery fabric segment were down 13.5% compared with the second quarter of this fiscal year. Sales for the residential upholstery fabric products remained under pressure during the quarter by reduced demand, driven by high inventory levels for the residential home furnishings industry. This pressure is expected to continue through at least the first quarter of next fiscal year as retailers and manufacturers work through their inventory positions. Demand remained solid in our hospitality business during the third quarter, with sales for our hospitality contract business accounting for approximately 30% of the Upholstery Fabrics segment's total sales. Operating loss for the quarter was $420,000, compared with income from operations of $2.4 million a year ago. Our operating performance for the third quarter this fiscal year as compared to the prior year period, was mostly pressured by lower residential sales as well as operating inefficiencies in this segment's Haiti cut-and-sew facility and in its Read Window Products business. These pressures were partially offset by a significantly more favorable foreign exchange rate associated with this segment's operations in China, as well as lower costs resulting from the restructure of this segment's cut-and-sew platform in China during the prior quarter. Based on demand trends and customer sentiment, we began a rationalization and consolidation of our cut-and-sew upholstery kit platform in Haiti near the end of the third quarter. This restructuring aligns our capacity and cost with current demand levels for upholstery kits, while still allowing us to support our customers and scale for additional capacity if conditions improve. The adjustment will be completed during the fourth quarter this fiscal year and includes terminating a lease and relocating to an existing mattress cover facility. We expect annualized savings of approximately $1.5 million from this initiative, and we will recoup $2.4 million in prepaid rent expense over the next 6.5 years. I'll turn to the balance sheet. We reported $16.7 million in cash and no outstanding debt as of the end of the third quarter. This compares with $14.6 million in cash and investments and no debt as of the end of last fiscal year. Cash flow from operations and free cash flow were $4.6 million and $2.5 million, respectively, for the first nine months of this fiscal year as compared with cash flow from operations and free cash flow of a negative $12.4 million and negative $18.5 million, respectively, for the first nine months of last fiscal year. Our cash flow from operations and free cash flow during the first nine months of this fiscal year were favorably affected by working capital management, namely reductions in inventory. Importantly, since the end of the third quarter of last fiscal year, inventory reduction has contributed $18.2 million to the company's cash position. Consistent with our focus on inventory, we are tightly managing our capital spending with emphasis on business-critical projects only. Capital expenditures through the third quarter of this fiscal year were $1.6 million, compared with $5.3 million for the same period last year. For the full fiscal year, we expect capital expenditures to be in the range of $2.5 million-$2.8 million. We also completed the closing of a new three-year asset-based revolving credit facility of up to $35 million. Borrowing availability under this new facility is based on a calculation using certain of the company's accounts receivable and inventory determined on a monthly basis. While we do not currently foresee a need to borrow, we are pleased that, as compared to our prior facility, this new facility gives us enhanced liquidity and more flexibility with minimal financial covenants as we continue to navigate a difficult environment. The company did not pay any dividends during the third quarter of this fiscal year following the suspension of our quarter cash dividend on our common stock earlier in the year. The company also did not repurchase any shares during the third quarter of this fiscal year, leaving $3.2 million available under our current share repurchase program. Despite the current share repurchase authorization, we do not expect any activity during the fourth quarter this fiscal year, and we remain focused on preserving liquidity and being positioned to support future growth opportunities. I'll turn the call over to Iv to discuss the general outlook for the fourth quarter this fiscal year, and then we will take your questions. Iv? Thank you, Ken. Due to the continued volatility in the macro environment, we are providing only limited sequential financial guidance for the fourth quarter of this fiscal year. We expect net sales for the fourth quarter to be moderately higher as compared to $52.5 million in net sales for the third quarter of this fiscal year, driven largely by strong sales improvement in the mattress fabric segment and comparable sales performance in the upholstery fabric segment. We expect a consolidated operating loss for the fourth quarter of this fiscal year that is meaningfully lower than the $7.8 million operating loss for the third quarter of this fiscal year. We also expect our cash position as of the end of the fourth quarter of this fiscal year to remain comparable to the $14.6 million at the end of last fiscal year. Now I know some of you are wondering what we mean by meaningfully lower operating loss for the fourth quarter as compared sequentially to the third quarter, here's what we can say about that. We have found in these uncertain times it is very challenging to give precise guidance. What we believe is that we have come off of our bottom, and we are starting to improve, specifically related to the CHF mattress fabric segment. As mentioned earlier, revenue has been a challenge in the macro environment, but we have reason for some optimism as we go forward. We are starting to see the product wins we had previously disclosed, and we believe we are gaining market share in both businesses. The most recovery is in CHF mattress fabrics, with new business placed at proper margins and based on actual costing. The pace of our recovery will be dictated by the recovery in the macro environment. We expect to improve our business sequentially and organically via market position, but we need some macro tailwinds for recovery to happen quicker. We are certainly committed to achieving a sustainable sequential improvement and regaining profitability during fiscal 2024. Importantly, as we weather the current challenges, we will continue to be laser-focused on prudent financial management with the goal of always maintaining a strong balance sheet, especially with regard to ensuring a strategic balance in our working capital. We are optimistic about Culp's future, and we know that financial stability is paramount to our success. With that, we're happy to take some questions. We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw a question, please press star then two. At this time, we will pause just momentarily to assemble our roster. Our first question here will come from Anthony Lebiedzinski with Sidoti & Company. Please go ahead. Yes, good morning, gentlemen, and thank you for taking the questions. First, you know, nice job with, maintaining a solid balance sheet in this difficult, operating environment. That's a quick comment from me. As far as my, you know, questions, you know, with the, you know, raw material costs, you know, moderating into just overall it seems like stabilization and some cost trends. What would you say is your confidence level as far as your ability to maintain pricing at these levels? Yeah, that's a good question, Anthony. Thank you. We did note that. Thanks for picking up on it. We are the way we talk about raw materials is there was such a inflationary pressure on us in raw materials over the last couple of years. We did not pass enough price on, or we weren't able to and did not get enough price. We're finally getting to the point with new products where we are able to catch up to that price lag. Historically, in our business, there's frequent introductions into the market, and so we can catch up to any raw material swings by introducing new products. Through this last couple of years, there's just been no intros. Everything's been deferred, so we haven't been able to do that, and we didn't do a good enough job pushing price. I'm not worried. We don't have price deflation of raw material to the point where we need to be adjusting pricing, but we can finally get on our new products, so we can have fair margins in the market. You know, we just have been really pushing towards new products getting launched, and we're finally glad to see it happen because we've at least neutralized a standard cost, which is terrific. Got it. Okay. Yeah, thanks for that, the explanation. Yeah, sounds like you're optimistic about the pipeline of new products. You also talked about some new customer programs as well. I think Ken, I think you mentioned that in your prepared remarks, that you saw late in the quarter. If you could just kind of expand on that, maybe just give us some examples of some of some new customer programs or new product that you're particularly excited about here. I think, the way I would speak to it, we're excited about both businesses, but both CHF Mattress Fabrics and Culp Upholstery Fabrics have positive trends to their market position. That's for sure. What we've tried to point to harder in the remarks and the release is where we need to improve certainly is in the mattress fabric segment. When I speak about that, I'm not trying to minimize the upholstery fabrics role in this. They've just been more stable. Where we're seeing the growth from current levels is in mattress fabrics. What got us pretty pumped up was the Las Vegas Market. If you went back to our last couple of earnings calls, I've been speaking to product positioning that we know, we're winning both on traditional bedding retailers and bed-in-a-box mattress cover customers for us. The rollouts kept getting delayed. In some cases, things that were due to launch last January of 2022 got deferred to the summer and then got deferred again to January of 2023. At the market, most recent Las Vegas market, finally, a lot of the things we had been building to started to ship, and we're starting to have success billing and shipping those items to our customer. There's more planned throughout this year. I feel like the industry is doing quite a bit of catch up of putting new products into the market. Again, that's traditional bedding and bed-in-a-box. It's across the board. We know it's not gonna happen overnight. We know things have to be staggered. Again, like, to keep pointing to the pace of the industry tailwind will help us immeasurably. We're gonna organically grow our position and our share, but we need some lift in the macro side that we know will come at some point. We're gonna grow, we can grow faster with some pull through. I hope that helps. Yeah, absolutely. Hopefully that momentum from the Vegas market continues at the High Point Market for you. Now I may have missed this. Did you comment on as far as the growth rate for the hospitality segment? Just wondering how that fared in the quarter. Yeah. Anthony, this is Ken. We, you know, we comment on the 30% of the upholstery fabrics business, but we didn't comment on the growth rate. I mean, it was definitely more stable than the residential part. I mean, residential was under significant pressure. Hospitality was probably in line with last year. Gotcha. Okay. All right. Then, you know, last question, you know, so, you know, Ken, you talked about the CapEx, you know, obviously being down because you're looking to conserve cash. Just wondering, you know, how much of that has been are you deferring to next year? I mean, you know, typically you guys spend, you know, somewhere around $6 million-$7 million. At least the last couple of years you've done that type of CapEx spending. You know, how much of the CapEx you think you'll need to catch up with in fiscal 2024 or fiscal 2025? Yeah, Anthony, that's a, that's a great question. I mean, obviously this year we have been focused on preserving cash and really just prioritizing every project. That said, we've tried to certainly. You know, maintain our maintenance level CapEx as much as we can, as much as we could. We continue to address that in the fourth quarter. I think looking ahead, you know, we've always said maintenance CapEx is in that $4 million-$5 million range. We're in the process now of looking at those projects for next year and prioritizing. At the same time, you know, we've made it clear to the divisions that, you know, they need to earn, and they need to be in a position where being able to justify those CapEx. At the same time, we also agree and understand that we have to maintain the equipment. That's gonna be a delicate balance as we go in the next year. Got it. All right. Well, thank you very much, and best of luck. Thank you, Anthony. Have a great day. Our next question will come from Rexford Henderson with Water Tower Research. Please go ahead. Good morning, thanks for taking my call. Let me add my congratulations about your balance sheet management. It's really gratifying to see that in such a difficult environment. I had some questions. If you mentioned that you were aiming to get back to profitability in fiscal 2024, can you clarify that a little bit in terms of, do you mean that for the full year or for a specific period later in the year? What basis are you thinking about that profitability? On the EBIT line, on the EBITDA line, or in net income? Well, Rex, great question. Thanks for calling that out. We talked kind of over and over through prepared remarks about sequential improvement. We know we're digging out of a hole in some ways. We would love to have profitability for the whole year. We would love that. Some of it's gonna depend on what kind of tailwind we can get in just general demand. We're gonna manage our margins and our sales better this year, no question, and we're gonna grow our market position. We need some tailwind. I think the way I'm looking at it is, we know the first half of the year is not likely to rebound in a great way, but we can control our sequential improvement in those quarters. I would have every expectation that we should be moving towards break even and then to some profitability later in the year. It's how we look at it. Ken, I don't know if you wanna tell them how we look at that. No, precise on what. How we've been guiding the operating income so much later. Yeah. No, that's exactly right. I mean, as we head into 2024, I mean, we understand it's gonna take the continued some time to get to that profitability, but we're looking at the second half of the year where we break through and are profitable at an EBIT level. That's just gonna take some time. You know, we're not guiding right now for the profitability of the year, but we're saying is that in that time, by certain time in FY 2024, we will be profitable on an EBIT level. Rex, I'll just say, I mean, that's what we think. I would love it if there would just be some lift in the business that could help us go faster with the sales reductions that we're dealing with that comes so much from the macro environment. It just makes it challenging. We are buying our time because we know when that gets normalized, it can happen for us faster. It's naive of us to think that's gonna happen and to try to predict it. Man, it would sure be fun if it would go a little quicker. Yeah. Sure. Let me ask a little bit more about the mattress fabrics business, which has been, you know, showing an operating loss in this year so far. So. You're transforming that business and getting some efficiencies and new product and some better pricing through those new products. How much volume? You know, where does the line cross in terms of volume in that business to make this segment profitable? How much additional volume are you gonna need and, you know, kind of when? Can you give me some guidance on what it takes to get that business back to profitability and on the top line? Yeah. Good, good question. That-- And you're picking right up on it. That's the business that we recognize carries so much value for us as a company and that has a great history and all these things that we need to get back to. We're making incredible improvements every day under the leadership of Tommy Bruno. His knowledge of all facets of the business are making a big difference. What I think the-- what we're doing, there's so much operational excellence being driven through that. Personnel, efficiency, quality, costing, pricing, all of those things are getting better. We're lowering our break-even revenue rate. We definitely are. We have some tailwinds, finally, with costs not continuing to rise. We can-- it won't take as much volume to turn profitable as it would have, you know, through COVID and through the inflationary pressures. Ken, I don't know if we can talk about a break, a line where that breaks, but it's definitely we're gonna be more profitable. We don't have to get all of our profit and volume anymore. We can get profit through operations, and we're gonna prove that we can do that, and then having some sales will just help us push it further. Yeah. I hope that helps you a little bit. Okay. Yeah, that's useful. What, I mean, what I'm hearing is I don't need to model I don't need to look at sales volumes equivalent to 2019, 2020 or, you know, going back to even 2022 in order to get back there. At some level below that, you think you can get back to profitability? Yeah, Rex, this is Ken. That's exactly right. With all the enhancements we've made, you know, we'll be able to on a comparable basis, we'll be able to get back there with less activity than before. That's. Again, all the different projects we've got going on right now, that's leading to that ability to not need as much as before. Just say again, Rex, really good questions. We don't. As we look out 12, 24 months, we don't think there's sales pressure. We have a lot of room to run with our sales level from where we are today. We've been at levels considerably higher than this, and we can go back to those. We obviously, again, I keep saying it, we just need. We're gonna do it organically. It'll be faster if we can get some support from just general conditions. We're not trying to run the business at a lower level. We wanna go back to those levels. It's so hard to predict. Okay. All right. I guess, you know, this is something we, you know, we've talked about in the past, but, you know, can you kinda recap what you're seeing in China with the workforce and then the operating environment there? Are you comfortable? Are you seeing any imminent risk to your operations in China at all? Kinda give us some confidence that things are going smoothly there. Sure, Rex, this is Boyd, and I'll touch on a couple of points related to China. First of all, certainly saw some positive impacts from the change in the China COVID policy that took place in December, both for our associates and our supply chain. This resulted in less disruption and uncertainty that came from that change. That was very positive. Then, of course, we've just come through the Chinese New Year period, which normally slows business at this time. We have seen a, you know, from all aspects, the supply chain has returned and is functioning normally at this point, coming back from the holiday. We're pleased with that. In general, Rex, I'd say that supply chain is functioning well. We are continuing to diversify our global platform, and we'll stay focused on continuing to do that. As you know, we have diversified to Vietnam, to Haiti. We have some diversification taking place in Turkey. We fully intend to expand in those other locations and have steps in the works now to do that, and we'll be doing that more aggressively in this next fiscal year. That's. While China is, you know, performing well and not anticipating issues, still think it's prudent for our business overall to continue on a diversification path as we, you know, have started. All right. Well, thank you for taking my call again, and good luck. Thank you, Rex. Have a great day. Yeah. Thanks. This concludes our question-and-answer session. I'd like to turn the conference back over to Iv Culp for closing remarks. Thank you, operator. Again, thanks to everyone for your participation and your interest in Culp. We look forward to updating you on our progress next quarter. Have a great day. The conference has now concluded. Thank you very much for attending today's presentation. You may now disconnect your lines.