Culp Inc. reported significantly lower-than-expected earnings amid a decline in mattress fabric sales due to lower-priced mattress options from China.

Net income fell 81 percent in the first-quarter to $957,000, or 8 cents per share, in comparison to $4.98 million in the first-quarter of 2017. The earnings of the mattress company were 16 cents lower than analyst estimates polled by Yahoo Finance.

Culp shares dropped 4.2 percent in after-hours trading on Wednesday, closing at $27.65 and reopening at $26.50 on Thursday. Shares proceeded to fall another 4.4 percent on Thursday to $25.35, an 8.3 percent drop since Wednesday’s closing price.

The High Point-based company reported a 10 percent drop in revenues despite a 24 percent decline in mattress fabric sales. It offset the weak fabric sales with 11 percent growth in upholstery fabric sales.

Iv Culp, president of Culp’s mattress fabrics division, attributed the poor sales to inexpensive options from China.

“We have continued to face very soft demand trends related to the rapid growth of low-cost imported mattresses from China,” said Culp. “The influx of these products has significantly disrupted the domestic mattress business and affected many of our customers.”

It projects that sales will decrease by 5 percent in the second-quarter of its fiscal year.

Culp is optimistic that it will experience an increase in long-term sales following its recent launch of a line of bedding accessories called ‘Comfort Supply Company by Culp.’ The combination of this line with a new digital marketing strategy aimed to attract younger consumers is the strategic direction the company is pursuing to combat the increase in low-cost foreign competition.

It is hopeful that a change in the direction of U.S. trade laws regarding the bedding sector will help it compete with cheaper foreign mattress options.

“Looking ahead, we see continued uncertainty in the mattress industry that will affect short-term demand trends and our operating performance,” said Culp. “We are optimistic that the proposed relief being sought by the bedding industry under U.S. trade laws to address the impact of imported, low-priced mattresses from China will be favorable for our business.”

The results can be found here.