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I'll begin the call with some brief comments and then Ken will review the financial results for the quarter. I'll then update you on the strategic actions in each of our segments. After that, Ken will review our third-quarter business outlook, and then we'll be glad to answer your questions. As expected, our results for the second quarter reflect the ongoing challenges facing the bedding industry related to the significant increase of low-priced imported mattresses from China.

We believe the recent petition approved under U.S. trade laws to address this situation will ultimately be favorable for the domestic mattress industry. However, the high volume of imports continued to affect our major customers during the second quarter, which reduced demand for our mattress fabrics and mattress covers. Our upholstery fabrics business had a solid performance for the second quarter with a meaningful contribution from Read Window Products, which was acquired in April of 2018.

While we're experiencing considerable headwinds with respect to the mattress industry, we are optimistic that we will begin to see improvement in our quarterly results during the fourth quarter of this fiscal year as preliminary duties are expected to be announced and put in place. We will continue to execute on our product-driven strategy as we expand our reach into new markets. We are excited about the potential growth opportunities for Read Window in the hospitality space and for eLuxury, Culp's e-commerce business offering bedding accessories and home goods direct to consumers. Above all, we remain focused on offering creative designs and innovative products that meet the changing demands of our diverse customer base.

Importantly, we have continued to generate strong free cash flow, especially during the second quarter, and returned funds to shareholders through another quarterly dividend increase and share repurchases. These decisions reflect our confidence in Culp's future. We have the financial strength to support our business in this current environment. And we are well-positioned for continued growth as the market conditions evolve.

I'll now turn the call over to Ken, who will review the financial results for the quarter.

Ken Bowling -- Chief Financial Officer

Thank you, Frank. As mentioned earlier on the call, we have posted slide presentations to our Investor Relations website that cover key performance measures. We have also posted our capital allocation strategy. Here are the highlights for the second quarter.

Net sales were $77 million, down 4.6% compared with the prior year. Pretax income in the second quarter was $4.3 million, compared with $6.2 million last year. Pretax income margin was 5.6%, compared with 7.6% a year ago. The financial results for the second quarter included a net benefit of approximately $443,000 in restructuring and related charges and credits, and none -- and other non-recurring items due mostly to the closure of our Anderson, South Carolina production facility.

Excluding this net credit, pre-tax income for the second quarter was $3.7 million. With respect to SG&A expenses, unallocated corporate expenses were down 25% compared to the prior-year period due mostly to lower incentive compensation expenses and lower professional fees. Net income attributable to Culp, Inc. shareholders for the quarter was $3 million or $0.23 per diluted share, compared with $4 million or $0.32 per diluted share last year.

Trailing 12 months adjusted EBITDA was $30.1 million or 9.7% of LTM sales. Consolidated return on capital was 18.4%. Now, let's take a look at our two businesses. For mattress fabrics segment, sales were $42 million, down 14% compared with last year's second quarter.

Operating income margin was two -- operating income was $2.9 million, compared with $6.6 million a year ago with operating income margin of 7%, compared with 13.5% a year ago. Our operations for the second quarter were affected by the significant decrease in demand caused by the growth in Chinese imported mattresses. Despite this pressure, we were still able to achieve a 7% operating margin, which reflects the significant investment in operational improvements we have made in this business over the past several years. With regard to eLuxury, the current annual run rate for sales is approximately $12 million with minimal operating income contribution.

Return on capital for mattress fabrics was 23.6%. For the upholstery fabrics segment, sales for the second quarter were $35 million, up 9% over the prior year due primary to the contribution from Read Window Products. Operating income was $2.7 million for the quarter, compared with $3.4 million for the same period last year. Operating income margin was 7.8%, compared with 7.4% last year.

Our operating performance for the second quarter was in line with expectations and we did benefit from a more favorable currency exchange rate in China. However, this gain was partially offset by the unfavorable impact of tariffs implemented during the quarter. With the closure of our Anderson, South Carolina operation early in the second quarter, we incurred approximately $270,000 in restructuring and related expenses. Notably, we sold the related equipment for approximately $1.3 million and we are actively pursuing the sale of the physical plant.

For Read Window Products, the current annual run rate for sales is approximately $11 million to $12 million, with operating income margin slightly higher than the overall operating income margin for this segment as a whole. Return on capital for the upholstery fabrics business continued to be impressive coming in at 57%. Here are the balance sheet highlights. Despite the headwinds we are facing in our mattress fabrics business, we have maintained a strong financial position through the first half of this year and are generating strong free cash flow.

We reported $31.5 million in total cash and investments and no debt. During the first six months of this fiscal year we have spent $3.5 million on capital expenditures, including vendor financed payments, funded $12.1 million for acquisitions and related expenses and returned $3.1 million to shareholders in regular dividends and share repurchases. We expect continued strong free cash flow in the second half of this fiscal year. The company repurchased approximately 37,000 shares during the first six months of this fiscal year, leaving $4.2 million available under the share repurchase program approved by the board in June of 2016.

Since the end of this quarter, we have repurchased an additional 19,000 shares, leaving approximately $3.8 million available under our repurchase program. With that, I'll turn the call back over to Frank.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Thank you, Ken. I will start with our mattress fabrics segment. Our mattress fabrics sales for the second quarter of fiscal 2019 reflect the ongoing disruptions and uncertainty surrounding the mattress industry. We were pleased to see sequential sales growth over the first quarter.

However, imported mattresses entering the United States from China have continued to significantly disrupt the domestic mattress business. In anticipation of both increased tariffs on mattresses and the anti-dumping petition that was approved by the United States International Trade Commission on November 1st, we believe a number of companies and retailers accelerated orders and promotions of low-cost imported mattresses. As a result, we experienced continued lower demand for fabric and sewn covers from our customers during the quarter. The second quarter marked the first full quarter to include the operations of eLuxury.

We are very excited about this important new sales channel for Culp and the opportunity to participate in the growing e-commerce direct-to-consumer space. We are working hard to develop and create innovative bedding accessory items to be marketed through this exciting platform. New products have already been developed within Culp's global manufacturing platform, and inventory is being prepared for product launches in the near term. We believe eLuxury enhances our strong value proposition and we expect to see favorable growth trends from this new business category as we move into the new calendar year.

Looking ahead, we do see ongoing challenges in the mattress industry that will continue to affect short-term demand trends and our operating performance. While we're pleased to see the anti-dumping petition approved on November 1st, and we are beginning to see some positive development, it is uncertain when demand trends will return to more normal levels. We believe the expected punitive measures against Chinese importers will be significant and will ultimately benefit our customers and our business, beginning sometime in our fourth quarter. Once this uncertainty is behind us, we expect our mattress fabrics sales and operating performance will improve during the fourth quarter of this fiscal year.

In spite of the challenges we are facing, we have a solid core business and strong competitive position across all product categories from fabric to sewn covers. We look forward to the opportunities ahead to expand our market reach with complementary products and new sales channels, especially as the mattress industry begins to stabilize. Now, I'll turn to the upholstery fabrics segment. We are pleased with our upholstery fabrics sales performance for the second quarter as we met expectations with a 9% growth over the second quarter of last year.

These results reflect our ability to offer creative designs in a wide array of innovative products to a diverse customer base, with higher sales to customers in both residential and hospitality markets. Importantly, these trends reflect a meaningful contribution from Read Window in the hospitality market. We are excited about the additional growth opportunities for this expanded offering of window treatments and the potential for additional acquisitions in this space. We had another successful showing at the October furniture market in High Point, which, for the first time, had a hospitality section, where we featured our complete line of products, including window treatments.

Our performance line of upholstery fabrics was again well received at this market and we continue to see favorable demand trends and strong placements with customers. Additionally, our LiveSmart performance fabrics brand were recently featured on The Learning Channel, a television program, Make This Place Your Home. Our product-driven strategy and ability to reach more customers and new end-user markets is a distinct competitive advantage for Culp in today's marketplace. Looking ahead, the potential for additional tariffs in 2019 and the associated geopolitical risks remains uncertain at this point.

We continue to monitor the situation and the related impact on our business. And if additional tariffs are implemented, we will determine an appropriate response. Despite these uncertainties, we believe Culp is very well-positioned to benefit from an uptick in demand for home furnishings and more stable market conditions. Ken will now review the outlook for the third quarter and then we'll take your questions.

Ken Bowling -- Chief Financial Officer

We expect overall sales to be down approximately 7% compared with the third quarter of last year. We expect sales, operating income, and margins in our mattress fabrics segment to show sequential improvement but to be significantly lower than the third quarter of last fiscal year due primarily to the continued significant growth in Chinese imported mattresses. Assuming the mattress industry relief materializes under U.S. trade laws, we expect to see more normalized trends during the fourth quarter of this fiscal year that are more in line with the prior year.

In our upholstery fabrics segment, we expect sales to be slightly up compared with a strong third quarter of last year due to the timing of the Chinese New Year. Operating income and margins are also expected to be slightly up compared with the same period a year ago. However, our projections are contingent upon any potential additional tariffs that could be imposed effective January 1, 2019 and could, therefore, affect our operating costs. Considering these factors, we expect to report pre-tax income for the third fiscal quarter in the range of $4.6 million to $5.4 million, excluding any restructuring and related charges and credits, and other non-recurring charges.

Pre-tax income for last year's third quarter was $7.5 million. Our performance for the fourth quarter of this fiscal year is currently expected to be more in line with the results achieved during the fourth quarter of last fiscal year. Based on our current budget, capital expenditures of this fiscal year are now expected to be in the $6 million to $6.5 million range as we have moved to a more maintenance level of capital expenditures. Additionally, given the strong free cash flow achieved in the second quarter and the current outlook, free cash flow for this fiscal year is expected to be improved over last year's results, even with the significant headwinds we are facing in our mattress fabrics segment.

With that, we'll now take your questions.

Operator

Thank you. [Operator instructions] And our first question comes from John Baugh with Stifel. Please go ahead.

John Baugh -- Stifel Financial Corp. -- Analyst

Thank you. Good morning. I wondered if we could walk down the path of the 25% tariff. And give us some sense if that's what we're looking at for the next 12 months plus how that impacts your business, I guess, on the furniture side? Thank you.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Good morning, John. The 25% tariff you're referring to, we've got 10% already, which we implemented in September, and the current, I guess, position from the administration is an additional 15% as of January 1st. If that were to be put in place on the furniture side, we will do exactly what we did with the first 10%, and that is we will increase prices. And we are benefiting from a weaker currency.

So the price increase to be equal, we didn't have to give a price increase for the full 10% because we did benefit from some currency but we would plan to do the same thing we did with the 10%, we will raise prices.b

John Baugh -- Stifel Financial Corp. -- Analyst

And, Frank, what position -- where are you competitively -- one of your competitors done so far with the 10%, where are they sourcing their fabric from? Are they in the same boat and doing the same thing or is there some other countries sourcing where you've got an issue?

Frank Saxon -- Vice Chairman and Chief Executive Officer

That's really -- let me -- there's really a couple of questions there, John. The first one is our competitors that are sourcing fabrics from China, which is really 90% of the upholstery fabrics comes from China, there is no other meaningful country in the world where upholstery fabrics come from. So, they are all -- have increased prices as well. The domestic producers, of which, there's a few, also have raised prices recently, we hear, and due to some raw material increases or other reasons.

So, we are not out there raising prices by ourselves. And I would expect that the other folks importing from China would continue to have to increase prices. They'd have to. The second part of the question is, there is really -- and we've looked at this -- we've looked at it a long time and we've continued to especially look more detailed over the last six months, is there any other place where we could source upholstery fabrics, or where our customers might go to source upholstery fabrics in the world.

And whether it's Indonesia, whether it's Turkey, whether it's South Korea, Taiwan, India, none of which are competitive with China even with the 25% duty. So, that gives us -- and we're in touch with a lot of players in those areas. And so, I don't think it's a risk that the business moves from China on the 25%. Yes.

[Inaudible]

John Baugh -- Stifel Financial Corp. -- Analyst

And then, Frank, before I touch on bedding, can you give me a sense of the amount of fabric? You said 90%, I think, of the imports are coming from China. What percentage of all upholstery we're consuming in this country -- upholstery fabric is coming from domestic producers as a percentage?

Frank Saxon -- Vice Chairman and Chief Executive Officer

I would say 10. I mean, our back of the envelope, there is no public data available, we think of it as 90/10, and there's a minuscule amount coming from other countries. Some come from Turkey, some from Indonesia, but they're really not significant.

John Baugh -- Stifel Financial Corp. -- Analyst

OK.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Unfortunately, China wiped out the domestic industry last decade.

John Baugh -- Stifel Financial Corp. -- Analyst

Yes. Yes. And then, on bedding, there is so much noise with the volumes impacting your business there. I'm curious, because we hear the high end of bedding is fairly strong, and I know you're not as well-positioned there.

But if we were to somehow get a picture of the rest of your bedding business exclusive of this low-end impact on the volume, what does it look like? How is Culp doing in terms of product mix and price per yard? Whatever color you could give will be great.

Iv Culp -- Chief Operating Officer

Yes. John, this is Iv. Thank you. I'll take that one.

And I want to recircle back a little bit to your question on tariffs. And just one thing that we should add from a bedding standpoint is while the tariffs are somewhat damaging and are tough on our upholstery side and renegotiating prices and some of those challenges have a cost, some of that plays really well to us on the mattress fabrics side and the mattress covers side because we are able to expand our mattress cover business into some of that China location because mattress covers aren't today in the Section 301 tariffs. Now, who knows what the future holds in any of that, but today it's enabling us to really expand our cut-and-sew business quite a bit into China and add that as a third leg of our cut-and-sew business. But to answer your question more directly, we really do -- I mean, it might be a misconception, we are pretty well-positioned from low to high.

Our design, our innovation in our business will be targeted toward all levels of bedding. We don't really just target lower ends but that's what's been so disruptive this year because of some of the inventory that's been built up, and just a lot of disruption at retail as well. So, I think we'll be well-positioned for both. For us, high-end bedding helps companies make mattresses because the mattresses sell very high.

And when we make high-end fabrics, it's better for us, price point wise, but it's not the same lift as a mattress company is going to get by selling a bed in multi-thousand dollars. Our fabrics are still going to be in the $7, $8, $9, $10 range. We're not going to be able to -- it's not such a dramatic shift for us in fabric to generate it. We need both to be strong, both the medium to low and the medium to high.

John Baugh -- Stifel Financial Corp. -- Analyst

OK. That's extremely helpful. And I guess, as I think about bedding and moving forward, is expectation, Iv, that we'll start to, what, see different behavior even before a number is announced maybe mid, late-February, because of fear that a number will be announced and that could be retroactive? Or would the expectation be that you really wouldn't see orders and/or shipments flowing through until after that? I'm trying to get a sense for how much the fourth quarter might benefit from a dumping rate announcement?

Iv Culp -- Chief Operating Officer

Yes. The expectation -- again, this is Iv. Thank you, John. The expectation we have is that the percentage is going to be significant.

And everyone that we talk to and we consult with it feels like it's fairly certain. I know that's not -- we can't guarantee it but it does feel fairly certain and most of that seems to be lining up with the calendar year. So, we have for sure seen many companies reestablishing supply chains to domestic production. And we're working on really an inordinate amount of projects for that end.

And for us, we have a really strong platform with our fabric production combined with cut-and-sew now in U.S., Haiti and in China, all three really gearing up very strong. So, we can't guarantee we're going to win in all of these places but we sure are working on a lot of them. And it feels, for us, pretty certain that end of our fiscal year should be back to some of the business we've been used to.

John Baugh -- Stifel Financial Corp. -- Analyst

OK. And then, finally on SSB, I know they've got deep-pocketed parent company funds, but we also know they're not doing terribly well, although they did make an acquisition. So, presumably, they have access to capital. Simple question is, do we need to worry at all about that receivable? What are you seeing out of that particular important customer?

Iv Culp -- Chief Operating Officer

I mean, we have not been worried about that. We -- that is a critical customer for us and one that we really like to do business with. We haven't been worried about it, John. We -- I like a lot of things about how they approach the business that -- and I think their acquisition was smart.

We really believe that the best way forward is the combination of B2B with B2C, which we are fully embracing here at Culp, too. So, we would expect that both of those channels to be something that we truthfully target-heavy going forward. That's a strategic customer for us.

Ken Bowling -- Chief Financial Officer

And, John, this is Ken. I mean, we monitor that account very closely and we certainly share -- we watch the news and in contact with them. So, it's an account we are very in touch with and on top of.

John Baugh -- Stifel Financial Corp. -- Analyst

And, Ken, there has been no change in their payment pattern behavior, I assume?

Ken Bowling -- Chief Financial Officer

No, no, no.

John Baugh -- Stifel Financial Corp. -- Analyst

Great. Great. Thank you. Appreciate it.

Good luck, guys.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Thank you, John.

Operator

Thank you. We'll next go to Bobby Griffin with Raymond James.

Bobby Griffin -- Raymond James -- Analyst

Good morning, everybody. I appreciate you taking my questions.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Good morning.

Bobby Griffin -- Raymond James -- Analyst

Frank, I first want to follow back up on the upholstery side of things. And you mentioned you guys have started to pass through some of the price increases for the 10% tariffs. What have you heard from your customers those price increases are having -- or what have you heard -- how those price increases are having an impact on demand? Is there any type of color you can give us maybe on your unit volume or your yardage? Help us to think about the consumers --

Frank Saxon -- Vice Chairman and Chief Executive Officer

Yes, we -- I mean, that's what we all -- Bobby, exactly what we're concerned about and have been, but we're not seeing it yet. Backlogs, orders, you see -- I mean, still are pretty good. We're not -- people are worried about that, but we're not seeing it yet. Business is decent.

Bobby Griffin -- Raymond James -- Analyst

So, the upholstery growth we're seeing, obviously some of it's benefiting from the acquisitions. But when you look at just kind of pure yardage numbers, your yardages are still showing growth. Is that correct?

Frank Saxon -- Vice Chairman and Chief Executive Officer

Yes. And remember, it's a little cloudy because we've got our Anderson, South Carolina plant sales related to that that are down and are phasing out. But if you would exclude those, then we are growing in our China-produced fabrics, and we feel pretty good now. I mean, I'm -- with the innovation, the creativity, the performance line, I mean, all feels pretty good to us right now, even with the tariffs.

Bobby Griffin -- Raymond James -- Analyst

OK. OK. That's helpful. I really appreciate that.

And then maybe I was hoping to maybe get a little bit more color on how the integration is going with Read Window Products. Have you made -- have you been able to push some of the Culp China fabrics in through that platform as we've talked about before in the past? If not, maybe kind of what's the timing on that?

Frank Saxon -- Vice Chairman and Chief Executive Officer

Yes. Yes. We -- the Read Window acquisition we're very pleased. They're performing a little better than expected from the beginning with -- on their rmargins.

Sales are pretty much as expected. The integration has gone well. We've got a fabulous team there. Customers have been really excited about Culp's expanded product offerings.

And we've been calling on all the major flags and key other customers and it's going very well. You also -- second part of your question is one of the key synergies over the long term, which is to use Culp fabric in the window treatments. Read Window, when we bought it, it was using no Culp fabrics. It was buying from other suppliers.

That's going to take a few years to get in place, but we started already with some products, which are getting great -- our first introductions are getting great receptions. They're not actually in sales yet, but the first ones are out in the market. They've been shown to customers and we're getting great reception. So, that will evolve quarter by quarter and I feel very good about achieving results on that particular synergy.

And, of course, that will bode well, Bobby, when and if we get another acquisition. We already have those products in the pipeline for the hospitality market.

Iv Culp -- Chief Operating Officer

And, Bobby, this is Iv. I would add one thing to what Frank was saying there too. He may have said it and I didn't hear him, but you had asked about what those China fabrics specifically and maybe in some cases yes, but we also can do those products from our North American locations as well. So, it's sort of the trend throughout the company with both Read and eLuxury and several -- where dots are just being connected in lots of really good ways, taking our fabrics from just the all traditional way of selling, manufacturers to find a new ways to get our products further downstream.

Lot of good things are happening across the company in that regard.

Frank Saxon -- Vice Chairman and Chief Executive Officer

I mean, we are going to see more synergy among our businesses. We're clearly seeing that. And one of Iv's really initiatives in his role is to maximize that synergy. We've got so many capabilities and strengths among our -- now our various platforms.

And it seems like lots of opportunities everywhere we look. And I think we're going to see more of that, exactly like this opportunity, where in this case the gray goods are made at our Canadian facility, which is part of CHF. We do digital printing on them and sell them, so -- through the Read Window Product channel. And the second example, we're doing -- we're developing a several key products for Culp produced for eLuxury.

All this is going to take a little time though, but we're seeing increasing synergies among our businesses.

Bobby Griffin -- Raymond James -- Analyst

OK. And then, I guess, lastly for me on mattresses. One, can you maybe refresh us a little bit on how the concentration of that business is among the big four players, maybe as a percentage of sales or something to help us think about that breakout of business? And then also, assuming we do get some help here from anti-dumping, and the volume does return, production capabilities under the kind of coverings business, how do you guys look to kind of capture some of that return on volume here to the U.S.?

Iv Culp -- Chief Operating Officer

Bobby, yes, I think you kind of have to look a little bit back and little bit forward to your question. For sure, for a long time, we have been well entrenched with the big four, and that has for a long time been a big part of the mattress industry. I know we've seen numbers where those big four are 60%, maybe even 70% of the business, have been in the past, but that's changing so much and so rapidly because there are so many new entrants. And I think even some of us as close in the industry as we are haven't grasped how many beds that are coming in and being sold against the market that we were really targeting.

The customers that we were not restricted to sell, but that was just sort of the market we were in. I think we're kind of -- our eyes are being opened to how many opportunities are ahead of us, seeing how much diversification of product we have, the platform we have of cut-and-sew and how we can target so many new customers. So, our customer list is much longer, much bigger than it was previously. And that's exciting for us as we think about where we can take products going forward.

Bobby Griffin -- Raymond James -- Analyst

Are those big four today still -- I mean, the last time I looked into filings there, plus 45%, plus around 50% of bedding sales, is that exposure still at the same level today?

Iv Culp -- Chief Operating Officer

Yes. I think they're still obviously in today's environment -- and they should also, I'd assume, they'll get a lift too with some protective measures that get placed on import. And they also -- those companies are getting very smart in the kind of products they're designing, developing and how they're looking at their new sales strategies. So, I think that's probably still fair, Bobby.

I mean, they're certainly critically important to us, those big four. No doubt, we have to keep a very strong focus on.

Bobby Griffin -- Raymond James -- Analyst

OK. I appreciate all the detail. Best of luck moving forward and the continued strength of integrating the businesses together.

Iv Culp -- Chief Operating Officer

Thank you.

Operator

Thank you. [Operator instructions] We'll next go to Marco Rodriguez with Stonegate Capital Markets.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

Good morning, guys. Thank you for taking my questions. Just a couple of quick follow-ups. I'm not sure, if I caught this or not, but did you provide a revenue contribution in the quarter for eLuxury and then also for Read?

Iv Culp -- Chief Operating Officer

No, we just -- Marco, we just gave the annual run rate on sales and operating income contribution.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

OK. I apologize. I guess, I missed that. What were those numbers?

Iv Culp -- Chief Operating Officer

It was 20 -- approximately $20 million for eLuxury and $11 million to $12 million for Read Windows. That was sales. Then on the operating income, we said the margins for Read Windows was going to be slightly higher than the overall upholstery fabrics margin, and then the operating income contribution for eLuxury was going to be minimal this -- for the annual run rate.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

Gotcha. And maybe if you could talk a little bit about eLuxury, just kind of what the performance you kind of saw over here on Black Friday, Cyber Monday? Was it kind of in expectations or just how you kind of saw that?

Iv Culp -- Chief Operating Officer

Yes. I think it's been fun for us, new for us to experience consumer sales around Black Friday, Cyber Monday, and was very busy. We have a lot of excitement about these holidays and hopefully it'll carry through the holiday season. More excited looking out, because we're in the process right now, a lot of -- building the pipeline is under way today with a lot of our new products and things that we're designing, both with fabrics and other products and finished products.

So, I would feel even more excited about next year this time in these holiday seasons when all of our items are up on the site and for sale. I think it's fun to see those peak-sale periods. And this one was good. I would expect next ones to be even better.

Frank Saxon -- Vice Chairman and Chief Executive Officer

Marco, another synergy in that line is that -- I didn't mention earlier is the -- it relates to eLuxury, is that we're taking the mattress pads that eLuxury makes, which is about half of those sales, and we've got a big initiative to sell them into our -- into the hospitality market on a B2B basis. And that's in the works now as another type of cross synergy between our businesses.

Iv Culp -- Chief Operating Officer

Yes, I think we -- Frank is right. We really have a lot of dots to connect throughout the company. And it's just taking us a little bit of time in figuring out where to put those pieces together, but that is -- that's a great one.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

Gotcha. And in regard to the comments on these new products that you've been developing and the inventory that you're building up here for these launches on eLuxury, I'm assuming that there's no issue from a capacity standpoint? And then also, maybe you can talk a little bit about timing as far as when these products might be launched and what you might be kind of looking at?

Iv Culp -- Chief Operating Officer

Yes. Well, we have already put a few select items on the site. We have some finished products we developed. We're selling some upholstery fabrics by the yard in concert with TLC show that aired.

A lot of these products we are making through our China platform, and these are items not impacted today by any Section 301 duty. So it's a little bit of a timeline of development, production and then, you're dealing with the China lead time of shipping. So again, it's somewhat really starts to gear up for us to be hitting the websites toward our fourth quarter to probably more substantial and real selling and profits in next fiscal year.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

Gotcha. And last quick question, just kind of a housekeeping item. Now, with eLuxury full quarter in, obviously Read for a couple quarters now, SG&A running around $10 million excluding onetime items. Is that a good run rate to look at for you guys going forward or are there additional things you might be looking to add or take out?

Ken Bowling -- Chief Financial Officer

Well, I think -- Marco, it's Ken. I think when you look at the addition of both new businesses and the impact on SG&A. I mean, you look at the second quarter and projecting forward, I think that is pretty representative of where we're going to be, maybe just a little bit higher going forward. But I think that with the mix of all that, it's probably safe to say second quarter is a good parameter of where to look to in the future, I guess.

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

Got it. Thanks a lot guys. I appreciate your time.

Operator

Thank you. And it does appear we have no further questions in the queue at this time. I'd like to turn the conference back over to our speakers for any additional or closing remarks.

Frank Saxon -- Vice Chairman and Chief Executive Officer

OK. Thank you. One last one comment I want to make for everybody is that I want to be sure that everybody hears how confident and optimistic we are about our future. We raised the dividend for the seventh consecutive year, we're repurchasing shares, and we are -- we have a strong balance sheet to weather the current short-term situation, but we are very confident and optimistic as we look ahead at all the opportunities ahead of us.

So, with that, I just want to say thank you again for participating in the Culp call and we look forward to updating you next quarter.

Operator

[Operator signoff]

Duration: 41 minutes

Call Participants:

Dru Anderson -- Investor Relations

Frank Saxon -- Vice Chairman and Chief Executive Officer

Ken Bowling -- Chief Financial Officer

John Baugh -- Stifel Financial Corp. -- Analyst

Iv Culp -- Chief Operating Officer

Bobby Griffin -- Raymond James -- Analyst

Marco Rodriguez -- Stonegate Capital Markets -- Analyst

More CULP analysis

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