* Now sees Q4 sales up 20 pct
* Sees mattress fabric sales up 26 pct
May 18 (Reuters) - Mattress and upholstery fabric maker Culp Inc CFI.N said its fourth-quarter sales will be higher than previously thought, as sales of its mattress fabrics were buoyed by a rebound in demand for bedding.
For the quarter ended May 2, the company said it now expects sales to grow 20 percent over the year ago period. It had earlier forecast a fourth-quarter sales increase of 12 percent to 16 percent.
Culp said mattress fabric sales, expected to increase 26 percent, will drive overall sales growth as consumer demand for furniture lagged demand for mattresses. Upholstery fabric sales are expected to increase 13 percent, the company said.
The U.S. mattress industry has seen a strong rebound after sales plunged the most in two decades in 2008.
However, the company cautioned that it is beginning to experience higher raw material costs in both segments as well as increased pricing pressure in its mattress fabrics business.
Shares of the company, expected to report fourth-quarter results in June, were up 3 percent in extended trade. They closed at $13.19 Tuesday on the New York Stock Exchange. (Reporting by Abhishek Takle in Bangalore; Editing by Maju Samuel)