Steelcase Inc. (NYSE: SCS) today reported second quarter revenue of
$855.8 million, net income of $63.1 million, or $0.53 per share,
and adjusted earnings per share of $0.39. In the prior year,
Steelcase reported revenue of $854.6 million, net income of $27.5
million, or $0.23 per share, and adjusted earnings per share of
$0.31.
Revenue and order growth (decline) compared to the prior year
were as follows:
| |
Q2 2025 vs. Q2 2024 |
| |
Revenue Growth (Decline) |
|
Organic Revenue Growth (Decline) |
|
Organic Order Growth (Decline) |
| |
|
|
|
|
|
|
Americas |
1 |
% |
|
3 |
% |
|
3 |
% |
| International |
(4 |
)% |
|
(4 |
)% |
|
(11 |
)% |
| Steelcase Inc. |
- |
% |
|
2 |
% |
|
(1 |
)% |
Revenue was approximately flat in the second quarter compared to
the prior year, with a 1 percent increase in the Americas and a 4
percent decrease in International. On an organic basis, revenue
grew 2 percent, with 3 percent growth in the Americas and a 4
percent decline in International. The Americas growth was driven by
higher volume from large corporate, education, and government
customers, while the International decline was primarily driven by
continued weakness in China.
Orders (adjusted for the impact of a divestiture and currency
translation effects) declined modestly in the second quarter
compared to the prior year, including 3 percent growth in the
Americas and an 11 percent decline in International. The order
growth in the Americas was primarily driven by government,
education, and healthcare customers, while orders from large
corporate customers declined compared to the prior year after
several quarters of strong year-over-year growth. The order decline
in International was driven by declines across most major markets
with the exception of India.
"Our business continued to improve this quarter as our adjusted
earnings grew 26% and we drove 3% order growth in the Americas,"
said Sara Armbruster, president and CEO. "Our education business
had especially strong results this quarter, which reflected the
benefits of our strategy to diversify the customers and markets we
serve. In the Americas, our strategy to lead the workplace
transformation continued to gain traction as we have increased our
market share over the past year based on available industry data
through July. We expect order patterns from our largest corporate
customers to return to growth in the second half of the year."
Operating income (loss) and adjusted operating income (loss)
were as follows:
| |
Operating income (loss) |
|
Adjusted operating income (loss) |
| |
(Unaudited) |
|
(Unaudited) |
| |
Three months ended |
|
Three months ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Americas |
$ |
102.0 |
|
|
$ |
60.0 |
|
|
$ |
76.1 |
|
|
$ |
63.3 |
|
| International |
|
(12.0 |
) |
|
|
(19.0 |
) |
|
|
(7.6 |
) |
|
|
(10.0 |
) |
| |
$ |
90.0 |
|
|
$ |
41.0 |
|
|
$ |
68.5 |
|
|
$ |
53.3 |
|
Operating income of $90.0 million in the second quarter
represented an increase of $49.0 million compared to the prior
year, driven by a $27.9 million benefit from a gain on the sale of
land (net of related variable compensation expense), $5.7 million
of lower restructuring costs, gross margin improvement in the
Americas and lower operating expenses in International. The gain
recorded during the quarter related to the sale of approximately
315 acres of unused land for net proceeds of $44.2 million.
Adjusted operating income of $68.5 million in the second quarter
represented an increase of $15.2 million compared to the prior
year.
"The Americas delivered an 11% adjusted operating margin this
quarter, driven by the seasonal strength of our education business
and the continued progress of our profitability improvement
initiatives," said Dave Sylvester, senior vice president and CFO.
"Our International segment drove $2.4 million of year-over-year
improved adjusted operating results, despite the soft demand
environment, and expects to be profitable in the third
quarter."
Gross margin of 34.5 percent in the second quarter represented
an improvement of 130 basis points compared to the prior year
driven by favorable business mix and benefits from operational
performance and cost reduction initiatives.
Operating expenses of $205.1 million in the second quarter
represented a decrease of $30.8 million compared to the prior year.
The current year reflected a $42.1 million benefit from a gain on
sale of land, a $4.3 million decrease from a divestiture, $3.7
million of lower spending and employee costs in International, $9.8
million of higher variable compensation expense (driven by the gain
on the sale of land) and $2.2 million of higher information
technology costs primarily related to the company's business
transformation initiative. The prior year reflected $5.1 million of
gains related to the sale of an aircraft and other aviation
assets.
Total liquidity, which is comprised of cash and cash
equivalents, short-term investments and the cash surrender value of
company-owned life insurance, aggregated to $507.1 million at the
end of the second quarter and represented an increase of $192.6
million compared to the prior year. Total debt was $446.7 million.
Trailing four quarter adjusted EBITDA of $285.3 million (or 9.1
percent of revenue) represented an increase of 16 percent compared
to the prior year.
The Board of Directors has declared a quarterly cash dividend of
$0.10 per share, to be paid on or before October 15, 2024, to
shareholders of record as of September 30, 2024.
Outlook
At the end of the second quarter, the company’s backlog was
approximately $680 million, which was approximately flat compared
to the prior year and contained a higher percentage of orders
expected to ship within ninety days compared to the prior year. The
company expects third quarter fiscal 2025 revenue to be in the
range of $785 to $810 million. The company reported revenue of
$777.9 million in the third quarter of fiscal 2024. The projected
revenue range translates to growth of 1 to 4 percent compared to
the prior year, or 1 to 5 percent on an organic basis.
The company expects to report earnings per share of between
$0.18 to $0.22 for the third quarter of fiscal 2025 and adjusted
earnings per share of between $0.21 to $0.25. The company reported
earnings per share of $0.26 and had adjusted earnings per share of
$0.29 in the third quarter of fiscal 2024 which benefited by
approximately $0.09 related to the reversal of an accrued earnout
liability and gains from the sale of fixed assets.
The third quarter estimates include:
- gross margin of approximately 32.5 to 33.0 percent,
- projected operating expenses of between $225 to $230 million,
which includes $4.3 million of amortization of purchased intangible
assets,
- projected interest expense, net of investment income and other
income, net, of approximately $2 million and
- a projected effective tax rate of approximately 27
percent.
"Based on our results through the first half of the year and our
third quarter outlook, we continue to have confidence of
potentially achieving the higher end of the range of our fiscal
2025 target for adjusted earnings per share of between $0.85 to
$1.00," said Dave Sylvester.
"We are pleased with our results through the first half of
fiscal 2025 in which our adjusted earnings per share increased by
nearly 40% compared to the prior year," said Sara Armbruster. "We
continue to focus on developing innovative solutions to help our
customers transform their workplaces and diversify the customer and
market segments we serve."
| Business
Segment Results |
| (in
millions) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
(Unaudited) |
|
|
|
(Unaudited) |
|
|
|
| |
Three Months Ended |
|
|
|
Six Months Ended |
|
|
|
| |
August 23,2024 |
|
August 25,2023 |
|
% Change |
|
August 23,2024 |
|
August 25,2023 |
|
% Change |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas (1) |
$ |
688.0 |
|
$ |
679.3 |
|
1 |
% |
|
$ |
1,242.4 |
|
$ |
1,252.1 |
|
(1 |
)% |
| International (2) |
|
167.8 |
|
|
175.3 |
|
(4 |
)% |
|
|
340.7 |
|
|
354.4 |
|
(4 |
)% |
| |
$ |
855.8 |
|
$ |
854.6 |
|
— |
% |
|
$ |
1,583.1 |
|
$ |
1,606.5 |
|
(1 |
)% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue
mix |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Americas |
|
80.4 |
% |
|
79.5 |
% |
|
|
|
|
78.5 |
% |
|
77.9 |
% |
|
|
| International |
|
19.6 |
% |
|
20.5 |
% |
|
|
|
|
21.5 |
% |
|
22.1 |
% |
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating income
(loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Americas |
$ |
102.0 |
|
$ |
60.0 |
|
|
|
|
$ |
120.5 |
|
$ |
79.8 |
|
|
|
| International |
|
(12.0 |
) |
|
(19.0 |
) |
|
|
|
|
(12.9 |
) |
|
(31.5 |
) |
|
|
| |
$ |
90.0 |
|
$ |
41.0 |
|
|
|
|
$ |
107.6 |
|
$ |
48.3 |
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating
margin |
|
10.5 |
% |
|
4.8 |
% |
|
|
|
|
6.8 |
% |
|
3.0 |
% |
|
|
Business Segment Footnotes
- The Americas segment serves
customers in the U.S., Canada, the Caribbean Islands and Latin
America with a comprehensive portfolio of furniture, architectural,
textile and surface imaging products that are marketed to
corporate, government, healthcare, education and retail customers
primarily through the Steelcase, AMQ, Coalesse, Designtex, HALCON,
Orangebox, Smith System and Viccarbe brands.
- The International segment serves
customers in EMEA and Asia Pacific with a comprehensive portfolio
of furniture and architectural products that are marketed to
corporate, government, healthcare, education and retail customers
primarily through the Steelcase, Coalesse, Orangebox, Smith System
and Viccarbe brands.
| QUARTER
OVER QUARTER ORGANIC REVENUE GROWTH (DECLINE) BY
SEGMENT |
| Q2 2025 vs. Q2
2024 |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
| |
Steelcase Inc. |
|
Americas |
|
International |
| |
|
|
|
|
|
|
Q2 2024 revenue |
$ |
854.6 |
|
|
$ |
679.3 |
|
|
$ |
175.3 |
|
| Divestiture |
|
(12.2 |
) |
|
|
(12.2 |
) |
|
|
— |
|
| Currency translation
effects |
|
(1.6 |
) |
|
|
(0.7 |
) |
|
|
(0.9 |
) |
| Q2 2024 revenue, adjusted |
$ |
840.8 |
|
|
$ |
666.4 |
|
|
$ |
174.4 |
|
| |
|
|
|
|
|
| Q2 2025 revenue |
$ |
855.8 |
|
|
$ |
688.0 |
|
|
$ |
167.8 |
|
| Organic growth (decline)
$ |
$ |
15.0 |
|
|
$ |
21.6 |
|
|
$ |
(6.6 |
) |
| Organic growth (decline)
% |
|
2 |
% |
|
|
3 |
% |
|
|
(4 |
)% |
| ADJUSTED
EARNINGS PER SHARE |
|
|
|
|
(Unaudited) |
(Unaudited) |
|
(Unaudited) |
| |
Three Months Ended |
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Earnings per share |
$ |
0.53 |
|
|
$ |
0.23 |
|
|
$ |
0.62 |
|
|
$ |
0.24 |
|
| Amortization of purchased
intangible assets, per share |
|
0.03 |
|
|
|
0.03 |
|
|
|
0.07 |
|
|
|
0.07 |
|
| Income tax effect of
amortization of purchased intangible assets, per share |
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.02 |
) |
|
|
(0.02 |
) |
| Restructuring costs, per
share |
|
0.02 |
|
|
|
0.07 |
|
|
|
0.07 |
|
|
|
0.14 |
|
| Income tax effect of
restructuring costs, per share |
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.02 |
) |
|
|
(0.03 |
) |
| Gains on the sale of land, net
of variable compensation impacts, per share |
|
(0.23 |
) |
|
|
— |
|
|
|
(0.23 |
) |
|
|
— |
|
| Income tax effect of gains on
the sale of land, net of variable compensation impacts, per
share |
|
0.06 |
|
|
|
— |
|
|
|
0.06 |
|
|
|
— |
|
| Adjusted earnings per
share |
$ |
0.39 |
|
|
$ |
0.31 |
|
|
$ |
0.55 |
|
|
$ |
0.40 |
|
| ADJUSTED
EBITDA |
|
(Unaudited) |
| |
Three Months Ended |
|
Trailing FourQuarters Ended |
| |
November 24,2023 |
|
February 23,2024 |
|
May 24,2024 |
|
August 23,2024 |
|
August 23,2024 |
|
Net income |
$ |
30.8 |
|
|
$ |
21.3 |
|
|
$ |
10.9 |
|
|
$ |
63.1 |
|
|
$ |
126.1 |
|
| Income tax expense |
|
9.8 |
|
|
|
5.3 |
|
|
|
3.2 |
|
|
|
22.8 |
|
|
|
41.1 |
|
| Interest expense |
|
6.4 |
|
|
|
6.3 |
|
|
|
6.2 |
|
|
|
6.4 |
|
|
|
25.3 |
|
| Depreciation and
amortization |
|
21.1 |
|
|
|
20.8 |
|
|
|
20.2 |
|
|
|
20.0 |
|
|
|
82.1 |
|
| Share-based compensation |
|
3.4 |
|
|
|
3.6 |
|
|
|
14.5 |
|
|
|
2.9 |
|
|
|
24.4 |
|
| Restructuring costs |
|
2.1 |
|
|
|
4.4 |
|
|
|
6.3 |
|
|
|
2.2 |
|
|
|
15.0 |
|
| Gains on the sale of land, net
of variable compensation impacts |
|
(0.8 |
) |
|
|
— |
|
|
|
— |
|
|
|
(27.9 |
) |
|
|
(28.7 |
) |
| Adjusted EBITDA |
$ |
72.8 |
|
|
$ |
61.7 |
|
|
$ |
61.3 |
|
|
$ |
89.5 |
|
|
$ |
285.3 |
|
| |
|
|
|
|
|
|
|
|
|
| Revenue |
$ |
777.9 |
|
|
$ |
775.2 |
|
|
$ |
727.3 |
|
|
$ |
855.8 |
|
|
$ |
3,136.2 |
|
| Adjusted EBITDA as a
percentage of revenue |
|
9.4 |
% |
|
|
8.0 |
% |
|
|
8.4 |
% |
|
|
10.5 |
% |
|
|
9.1 |
% |
| ADJUSTED
EBITDA |
|
(Unaudited) |
| |
Three Months Ended |
|
Trailing FourQuarters Ended |
| |
November 25,2022 |
|
February 24,2023 |
|
May 26,2023 |
|
August 25,2023 |
|
August 25,2023 |
|
Net income |
$ |
11.4 |
|
|
$ |
15.7 |
|
|
$ |
1.5 |
|
|
$ |
27.5 |
|
|
$ |
56.1 |
|
| Income tax expense |
|
5.2 |
|
|
|
8.7 |
|
|
|
1.4 |
|
|
|
9.5 |
|
|
|
24.8 |
|
| Interest expense |
|
7.6 |
|
|
|
7.2 |
|
|
|
6.6 |
|
|
|
6.6 |
|
|
|
28.0 |
|
| Depreciation and
amortization |
|
23.5 |
|
|
|
22.8 |
|
|
|
20.4 |
|
|
|
21.3 |
|
|
|
88.0 |
|
| Share-based compensation |
|
2.1 |
|
|
|
3.6 |
|
|
|
13.7 |
|
|
|
4.2 |
|
|
|
23.6 |
|
| Restructuring costs |
|
10.6 |
|
|
|
3.9 |
|
|
|
8.1 |
|
|
|
7.9 |
|
|
|
30.5 |
|
| Gains on the sale of land, net
of variable compensation impacts |
|
— |
|
|
|
(4.0 |
) |
|
|
— |
|
|
|
— |
|
|
|
(4.0 |
) |
| Adjusted EBITDA |
$ |
60.4 |
|
|
$ |
57.9 |
|
|
$ |
51.7 |
|
|
$ |
77.0 |
|
|
$ |
247.0 |
|
| |
|
|
|
|
|
|
|
|
|
| Revenue |
$ |
826.9 |
|
|
$ |
801.7 |
|
|
$ |
751.9 |
|
|
$ |
854.6 |
|
|
$ |
3,235.1 |
|
| Adjusted EBITDA as a
percentage of revenue |
|
7.3 |
% |
|
|
7.2 |
% |
|
|
6.9 |
% |
|
|
9.0 |
% |
|
|
7.6 |
% |
| PROJECTED
ORGANIC REVENUE GROWTH |
| Q3 2025 vs. Q3
2024 |
|
|
| |
Steelcase Inc. |
| |
|
|
|
Q3 2024 revenue |
$ |
777.9 |
|
| Divestiture |
|
(10.6 |
) |
| Currency translation
effects |
|
7.0 |
|
| Q3 2024 revenue, adjusted |
$ |
774.3 |
|
| |
|
|
| Q3 2025 revenue,
projected |
$ |
785 - 810 |
|
| Organic growth $ |
$ |
11 - 36 |
|
| Organic growth % |
|
1 - 5 |
% |
| PROJECTED
ADJUSTED EARNINGS PER SHARE |
| |
Three Months Ended |
| |
November 22,2024 |
|
November 24,2023 |
| Earnings per share |
$ |
0.18 - 0.22 |
|
$ |
0.26 |
|
|
Amortization of purchased intangible assets, per share |
|
0.04 |
|
|
|
0.04 |
|
| Income tax effect of
amortization of purchased intangible assets, per share |
|
(0.01 |
) |
|
|
(0.01 |
) |
| Restructuring costs, per
share |
|
— |
|
|
|
0.02 |
|
| Income tax effect of
restructuring costs, per share |
|
— |
|
|
|
(0.01 |
) |
| Gains on the sale of land, net
of variable compensation impacts, per share |
|
— |
|
|
|
(0.01 |
) |
| Income tax effect of gains on
the sale of land, net of variable compensation impacts, per
share |
|
— |
|
|
|
— |
|
| Adjusted earnings per
share |
$ |
0.21 - 0.25 |
|
$ |
0.29 |
|
| FISCAL 2025
TARGETS |
|
|
| |
Twelve Months Ended |
| |
February 28,2025 |
|
Earnings per share |
$ |
0.86 - 1.01 |
|
|
Amortization of purchased intangible assets, per share |
|
0.15 |
|
| Income tax effect of
amortization of purchased intangible assets, per share |
|
(0.04 |
) |
| Restructuring costs, per
share |
|
0.07 |
|
| Income tax effect of
restructuring costs, per share |
|
(0.02 |
) |
| Gains on the sale of land, net
of variable compensation impacts, per share |
|
(0.23 |
) |
| Income tax effect of gains on
the sale of land, net of variable compensation impacts, per
share |
|
0.06 |
|
| Adjusted earnings per
share |
$ |
0.85 - 1.00 |
|
| Steelcase
Inc. |
| |
(Unaudited) |
|
(Unaudited) |
| |
Three Months Ended |
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Revenue |
$ |
855.8 |
|
|
100.0 |
% |
|
$ |
854.6 |
|
|
100.0 |
% |
|
$ |
1,583.1 |
|
|
100.0 |
% |
|
$ |
1,606.5 |
|
|
100.0 |
% |
| Cost of sales |
|
558.5 |
|
|
65.3 |
|
|
|
569.8 |
|
|
66.7 |
|
|
|
1,044.4 |
|
|
66.0 |
|
|
|
1,085.7 |
|
|
67.6 |
|
| Restructuring costs |
|
1.9 |
|
|
0.2 |
|
|
|
1.4 |
|
|
0.1 |
|
|
|
8.9 |
|
|
0.5 |
|
|
|
2.8 |
|
|
0.2 |
|
| Gross profit |
|
295.4 |
|
|
34.5 |
|
|
|
283.4 |
|
|
33.2 |
|
|
|
529.8 |
|
|
33.5 |
|
|
|
518.0 |
|
|
32.2 |
|
| Operating expenses |
|
205.1 |
|
|
24.0 |
|
|
|
235.9 |
|
|
27.6 |
|
|
|
422.6 |
|
|
26.7 |
|
|
|
456.5 |
|
|
28.4 |
|
| Restructuring costs
(benefits) |
|
0.3 |
|
|
— |
|
|
|
6.5 |
|
|
0.8 |
|
|
|
(0.4 |
) |
|
— |
|
|
|
13.2 |
|
|
0.8 |
|
| Operating income |
|
90.0 |
|
|
10.5 |
|
|
|
41.0 |
|
|
4.8 |
|
|
|
107.6 |
|
|
6.8 |
|
|
|
48.3 |
|
|
3.0 |
|
| Interest expense |
|
(6.4 |
) |
|
(0.7 |
) |
|
|
(6.6 |
) |
|
(0.8 |
) |
|
|
(12.6 |
) |
|
(0.8 |
) |
|
|
(13.2 |
) |
|
(0.8 |
) |
| Investment income |
|
2.9 |
|
|
0.3 |
|
|
|
0.8 |
|
|
0.1 |
|
|
|
5.3 |
|
|
0.3 |
|
|
|
1.3 |
|
|
0.1 |
|
| Other income (expense),
net |
|
(0.6 |
) |
|
(0.1 |
) |
|
|
1.8 |
|
|
0.2 |
|
|
|
(0.3 |
) |
|
— |
|
|
|
3.5 |
|
|
0.2 |
|
| Income before income tax
expense |
|
85.9 |
|
|
10.0 |
|
|
|
37.0 |
|
|
4.3 |
|
|
|
100.0 |
|
|
6.3 |
|
|
|
39.9 |
|
|
2.5 |
|
| Income tax expense |
|
22.8 |
|
|
2.6 |
|
|
|
9.5 |
|
|
1.1 |
|
|
|
26.0 |
|
|
1.6 |
|
|
|
10.9 |
|
|
0.7 |
|
| Net income |
$ |
63.1 |
|
|
7.4 |
% |
|
$ |
27.5 |
|
|
3.2 |
% |
|
$ |
74.0 |
|
|
4.7 |
% |
|
$ |
29.0 |
|
|
1.8 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating income |
$ |
90.0 |
|
|
10.5 |
% |
|
$ |
41.0 |
|
|
4.8 |
% |
|
$ |
107.6 |
|
|
6.8 |
% |
|
$ |
48.3 |
|
|
3.0 |
% |
| Amortization of purchased
intangible assets |
|
4.2 |
|
|
0.5 |
|
|
|
4.4 |
|
|
0.5 |
|
|
|
8.5 |
|
|
0.5 |
|
|
|
8.7 |
|
|
0.5 |
|
| Restructuring costs |
|
2.2 |
|
|
0.2 |
|
|
|
7.9 |
|
|
0.9 |
|
|
|
8.5 |
|
|
0.5 |
|
|
|
16.0 |
|
|
1.0 |
|
| Gains on the sale of land, net
of variable compensation impacts |
|
(27.9 |
) |
|
(3.2 |
) |
|
|
— |
|
|
— |
|
|
|
(27.9 |
) |
|
(1.7 |
) |
|
|
— |
|
|
— |
|
| Adjusted operating income |
$ |
68.5 |
|
|
8.0 |
% |
|
$ |
53.3 |
|
|
6.2 |
% |
|
$ |
96.7 |
|
|
6.1 |
% |
|
$ |
73.0 |
|
|
4.5 |
% |
|
Americas |
| |
(Unaudited) |
|
(Unaudited) |
| |
Three Months Ended |
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Revenue |
$ |
688.0 |
|
|
100.0 |
% |
|
$ |
679.3 |
|
100.0 |
% |
|
$ |
1,242.4 |
|
|
100.0 |
% |
|
$ |
1,252.1 |
|
100.0 |
% |
| Cost of sales |
|
437.0 |
|
|
63.5 |
|
|
|
443.4 |
|
65.3 |
|
|
|
801.9 |
|
|
64.5 |
|
|
|
832.0 |
|
66.5 |
|
| Restructuring costs |
|
1.5 |
|
|
0.2 |
|
|
|
— |
|
— |
|
|
|
5.6 |
|
|
0.5 |
|
|
|
0.6 |
|
— |
|
| Gross profit |
|
249.5 |
|
|
36.3 |
|
|
|
235.9 |
|
34.7 |
|
|
|
434.9 |
|
|
35.0 |
|
|
|
419.5 |
|
33.5 |
|
| Operating expenses |
|
147.3 |
|
|
21.5 |
|
|
|
175.8 |
|
25.9 |
|
|
|
314.0 |
|
|
25.3 |
|
|
|
338.9 |
|
27.0 |
|
| Restructuring costs |
|
0.2 |
|
|
— |
|
|
|
0.1 |
|
— |
|
|
|
0.4 |
|
|
— |
|
|
|
0.8 |
|
0.1 |
|
| Operating income |
|
102.0 |
|
|
14.8 |
|
|
|
60.0 |
|
8.8 |
|
|
|
120.5 |
|
|
9.7 |
|
|
|
79.8 |
|
6.4 |
|
| Amortization of purchased
intangible assets |
|
3.1 |
|
|
0.5 |
|
|
|
3.2 |
|
0.5 |
|
|
|
6.2 |
|
|
0.5 |
|
|
|
6.3 |
|
0.5 |
|
| Restructuring costs |
|
1.7 |
|
|
0.2 |
|
|
|
0.1 |
|
— |
|
|
|
6.0 |
|
|
0.5 |
|
|
|
1.4 |
|
0.1 |
|
| Gains on the sale of land, net
of variable compensation impacts |
|
(30.7 |
) |
|
(4.4 |
) |
|
|
— |
|
— |
|
|
|
(30.7 |
) |
|
(2.5 |
) |
|
|
— |
|
— |
|
| Adjusted operating income |
$ |
76.1 |
|
|
11.1 |
% |
|
$ |
63.3 |
|
9.3 |
% |
|
$ |
102.0 |
|
|
8.2 |
% |
|
$ |
87.5 |
|
7.0 |
% |
|
International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(Unaudited) |
|
(Unaudited) |
| |
Three Months Ended |
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Revenue |
$ |
167.8 |
|
|
100.0 |
% |
|
$ |
175.3 |
|
|
100.0 |
% |
|
$ |
340.7 |
|
|
100.0 |
% |
|
$ |
354.4 |
|
|
100.0 |
% |
| Cost of sales |
|
121.5 |
|
|
72.4 |
|
|
|
126.4 |
|
|
72.1 |
|
|
|
242.5 |
|
|
71.2 |
|
|
|
253.7 |
|
|
71.6 |
|
| Restructuring costs |
|
0.4 |
|
|
0.2 |
|
|
|
1.4 |
|
|
0.8 |
|
|
|
3.3 |
|
|
0.9 |
|
|
|
2.2 |
|
|
0.6 |
|
| Gross profit |
|
45.9 |
|
|
27.4 |
|
|
|
47.5 |
|
|
27.1 |
|
|
|
94.9 |
|
|
27.9 |
|
|
|
98.5 |
|
|
27.8 |
|
| Operating expenses |
|
57.8 |
|
|
34.5 |
|
|
|
60.1 |
|
|
34.3 |
|
|
|
108.6 |
|
|
31.9 |
|
|
|
117.6 |
|
|
33.2 |
|
| Restructuring costs
(benefits) |
|
0.1 |
|
|
0.1 |
|
|
|
6.4 |
|
|
3.6 |
|
|
|
(0.8 |
) |
|
(0.2 |
) |
|
|
12.4 |
|
|
3.5 |
|
| Operating income (loss) |
|
(12.0 |
) |
|
(7.2 |
) |
|
|
(19.0 |
) |
|
(10.8 |
) |
|
|
(12.9 |
) |
|
(3.8 |
) |
|
|
(31.5 |
) |
|
(8.9 |
) |
| Amortization of purchased
intangible assets |
|
1.1 |
|
|
0.7 |
|
|
|
1.2 |
|
|
0.7 |
|
|
|
2.3 |
|
|
0.7 |
|
|
|
2.4 |
|
|
0.7 |
|
| Restructuring costs |
|
0.5 |
|
|
0.3 |
|
|
|
7.8 |
|
|
4.4 |
|
|
|
2.5 |
|
|
0.7 |
|
|
|
14.6 |
|
|
4.1 |
|
| Gains on the sale of land, net
of variable compensation impacts |
|
2.8 |
|
|
1.7 |
|
|
|
— |
|
|
— |
|
|
|
2.8 |
|
|
0.8 |
|
|
|
— |
|
|
— |
|
| Adjusted operating income
(loss) |
$ |
(7.6 |
) |
|
(4.5 |
)% |
|
$ |
(10.0 |
) |
|
(5.7 |
)% |
|
$ |
(5.3 |
) |
|
(1.6 |
)% |
|
$ |
(14.5 |
) |
|
(4.1 |
)% |
Webcast
Steelcase will discuss second quarter results
and business outlook on a conference call at 8:30 a.m. Eastern time
tomorrow. Listeners may access the conference call at
http://ir.steelcase.com.
Non-GAAP Financial Measures
This earnings release contains certain non-GAAP
financial measures. A “non-GAAP financial measure” is defined as a
numerical measure of a company’s financial performance that
excludes or includes amounts so as to be different than the most
directly comparable measure calculated and presented in accordance
with GAAP in the condensed consolidated statements of income,
balance sheets or statements of cash flows of the company. The
non-GAAP financial measures used are (1) organic revenue growth
(decline), (2) adjusted operating income (loss), (3) adjusted
earnings per share and (4) adjusted EBITDA. Pursuant to the
requirements of Regulation G, the company has provided a
reconciliation of each of the non-GAAP financial measures to the
most directly comparable GAAP financial measure in the tables
above. These measures are supplemental to, and should be used in
conjunction with, the most comparable GAAP measures. Management
uses these non-GAAP financial measures to monitor and evaluate
financial results and trends.
Organic Revenue Growth
(Decline)
The company defines
organic revenue growth (decline) as revenue growth (decline)
excluding the impact of acquisitions and divestitures and foreign
currency translation effects. Organic revenue growth (decline) is
calculated by adjusting prior year revenue to include revenues of
acquired companies prior to the date of the company's acquisition,
to exclude revenues of divested companies and to use current year
average exchange rates in the calculation of foreign-denominated
revenue. The company believes organic revenue growth (decline) is a
meaningful metric to investors as it provides a more consistent
comparison of the company's revenue to prior periods as well as to
industry peers.
Adjusted
Operating Income (Loss) and Adjusted Earnings Per
Share
The company defines
adjusted operating income (loss) as operating income (loss)
excluding amortization of purchased intangible assets,
restructuring costs (benefits) and gains (losses) on the sale of
land, net of variable compensation impacts. The company defines
adjusted earnings per share as earnings per share excluding
amortization of purchased intangible assets, restructuring costs
(benefits) and gains (losses) on the sale of land, net of variable
compensation impacts, and the related income tax effects of these
items.
Amortization of
purchased intangible assets: The company may record intangible
assets (such as backlog, dealer relationships, trademarks, know-how
and designs and proprietary technology) when it acquires companies.
The company allocates the fair value of purchase consideration to
net tangible and intangible assets acquired based on their
estimated fair values. The fair value estimates for these
intangible assets require management to make significant estimates
and assumptions, which include the useful lives of intangible
assets. The company believes that adjusting for amortization of
purchased intangible assets provides a more consistent comparison
of its operating performance to prior periods as well as to
industry peers.
Restructuring costs
(benefits): Restructuring costs (benefits) may be recorded as the
company's business strategies change or in response to changing
market trends and economic conditions. The company believes that
adjusting for restructuring costs (benefits), which are primarily
associated with business exit and workforce reduction costs,
provides a more consistent comparison of its operating performance
to prior periods as well as to industry peers.
Gains (losses) on the
sale of land, net of variable compensation impacts: We may sell
land when conditions are favorable. Gains and losses on the sale of
land may increase or decrease, respectively, our variable
compensation expense. We believe adjusting for these items provides
a more consistent comparison of our operating performance to prior
periods as well as to industry peers. In Q2 2025, we began
adjusting for these items, as we realized a significant gain on the
sale of land during the quarter which had a significant impact on
our variable compensation expense, and we have adjusted the prior
periods presented for consistency and comparability.
Adjusted
EBITDA
The company defines
adjusted EBITDA as earnings before interest, taxes, depreciation
and amortization ("EBITDA") adjusted to exclude share-based
compensation, restructuring costs (benefits) and gains (losses) on
the sale of land, net of variable compensation impacts. The company
believes adjusted EBITDA provides investors with useful information
regarding the operating profitability of the company as well as a
useful comparison to other companies. EBITDA is a measurement
commonly used in capital markets to value companies and is used by
the company's lenders and rating agencies to evaluate its
performance. The company adjusts EBITDA for share-based
compensation as it represents a significant non-cash item which
impacts its earnings. The company also adjusts EBITDA for
restructuring costs and gains (losses) on the sale of land, net of
variable compensation impacts, to provide a more consistent
comparison of its earnings to prior periods as well as to industry
peers.
Forward-looking Statements
From time to time, in written and oral
statements, the company discusses its expectations regarding future
events and its plans and objectives for future operations. These
forward-looking statements discuss goals, intentions and
expectations as to future trends, plans, events, results of
operations or financial condition, or state other information
relating to the company, based on current beliefs of management as
well as assumptions made by, and information currently available
to, the company. Forward-looking statements generally are
accompanied by words such as “anticipate,” “believe,” “could,”
“estimate,” “expect,” “forecast,” “intend,” “may,” “possible,”
“potential,” “predict,” “project," "target” or other similar words,
phrases or expressions. Although the company believes these
forward-looking statements are reasonable, they are based upon a
number of assumptions concerning future conditions, any or all of
which may ultimately prove to be inaccurate. Forward-looking
statements involve a number of risks and uncertainties that could
cause actual results to differ materially from those in the
forward-looking statements and vary from the company's expectations
because of factors such as, but not limited to, competitive and
general economic conditions domestically and internationally; acts
of terrorism, war, governmental action, natural disasters,
pandemics and other Force Majeure events; cyberattacks; changes in
the legal and regulatory environment; changes in raw material,
commodity and other input costs; currency fluctuations; changes in
customer demand; and the other risks and contingencies detailed in
the company's most recent Annual Report on Form 10-K and its
other filings with the Securities and Exchange Commission.
Steelcase undertakes no obligation to update, amend, or clarify
forward-looking statements, whether as a result of new information,
future events, or otherwise.
About Steelcase Inc.
Established in 1912, Steelcase is a global
design, research and thought leader in the world of work. We help
people do their best work by creating places that work better.
Along with more than 30 creative and technology partner brands, we
design and manufacture furnishings and solutions for the many
places where work happens — including learning, health and work
from home. Our solutions come to life through our community of
expert Steelcase dealers in approximately 770 locations, as well as
our online Steelcase store and other retail partners. Founded in
Grand Rapids, Michigan, Steelcase is a publicly traded company with
fiscal year 2024 revenue of $3.2 billion. With approximately 11,300
global employees and our dealer community, we come together for
people and the planet — using our business to help the world work
better.
|
STEELCASE INC. |
|
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) |
|
(in millions, except per share data) |
| |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
|
August 23,2024 |
|
August 25,2023 |
|
Revenue |
$ |
855.8 |
|
|
$ |
854.6 |
|
|
$ |
1,583.1 |
|
|
$ |
1,606.5 |
|
| Cost of sales |
|
558.5 |
|
|
|
569.8 |
|
|
|
1,044.4 |
|
|
|
1,085.7 |
|
| Restructuring costs |
|
1.9 |
|
|
|
1.4 |
|
|
|
8.9 |
|
|
|
2.8 |
|
|
Gross profit |
|
295.4 |
|
|
|
283.4 |
|
|
|
529.8 |
|
|
|
518.0 |
|
| Operating expenses |
|
205.1 |
|
|
|
235.9 |
|
|
|
422.6 |
|
|
|
456.5 |
|
| Restructuring costs
(benefits) |
|
0.3 |
|
|
|
6.5 |
|
|
|
(0.4 |
) |
|
|
13.2 |
|
|
Operating income |
|
90.0 |
|
|
|
41.0 |
|
|
|
107.6 |
|
|
|
48.3 |
|
| Interest expense |
|
(6.4 |
) |
|
|
(6.6 |
) |
|
|
(12.6 |
) |
|
|
(13.2 |
) |
| Investment income |
|
2.9 |
|
|
|
0.8 |
|
|
|
5.3 |
|
|
|
1.3 |
|
| Other income (expense),
net |
|
(0.6 |
) |
|
|
1.8 |
|
|
|
(0.3 |
) |
|
|
3.5 |
|
|
Income before income tax expense |
|
85.9 |
|
|
|
37.0 |
|
|
|
100.0 |
|
|
|
39.9 |
|
| Income tax expense |
|
22.8 |
|
|
|
9.5 |
|
|
|
26.0 |
|
|
|
10.9 |
|
|
Net income |
$ |
63.1 |
|
|
$ |
27.5 |
|
|
$ |
74.0 |
|
|
$ |
29.0 |
|
| |
|
|
|
|
|
|
|
| Earnings per share: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.53 |
|
|
$ |
0.23 |
|
|
$ |
0.63 |
|
|
$ |
0.24 |
|
|
Diluted |
$ |
0.53 |
|
|
$ |
0.23 |
|
|
$ |
0.62 |
|
|
$ |
0.24 |
|
| Weighted average shares
outstanding - basic |
|
118.1 |
|
|
|
118.8 |
|
|
|
118.2 |
|
|
|
118.4 |
|
| Weighted average shares
outstanding - diluted |
|
118.8 |
|
|
|
119.1 |
|
|
|
119.0 |
|
|
|
118.6 |
|
| |
|
|
|
|
|
|
|
| Dividends declared and paid
per common share |
$ |
0.100 |
|
|
$ |
0.100 |
|
|
$ |
0.200 |
|
|
$ |
0.200 |
|
|
STEELCASE INC. |
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
(in millions) |
| |
(Unaudited) |
|
|
| |
August 23,2024 |
|
February 23,2024 |
|
ASSETS |
| Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
296.6 |
|
|
$ |
318.6 |
|
|
Short-term investments |
|
39.2 |
|
|
|
— |
|
|
Accounts receivable, net of allowance of $6.1 and $6.2 |
|
354.4 |
|
|
|
338.3 |
|
|
Inventories, net |
|
241.9 |
|
|
|
231.0 |
|
|
Prepaid expenses |
|
35.9 |
|
|
|
31.9 |
|
|
Other current assets |
|
32.5 |
|
|
|
39.6 |
|
| Total current assets |
|
1,000.5 |
|
|
|
959.4 |
|
| |
|
|
|
| Property, plant and equipment,
net of accumulated depreciation of $1,145.5 and $1,119.2 |
|
344.5 |
|
|
|
352.9 |
|
| Company-owned life insurance
("COLI") |
|
171.3 |
|
|
|
166.9 |
|
| Deferred income taxes |
|
117.8 |
|
|
|
115.8 |
|
| Goodwill |
|
275.4 |
|
|
|
274.8 |
|
| Other intangible assets, net
of accumulated amortization of $124.6 and $115.0 |
|
86.8 |
|
|
|
94.6 |
|
| Investments in unconsolidated
affiliates |
|
53.6 |
|
|
|
55.7 |
|
| Right-of-use operating lease
assets |
|
149.9 |
|
|
|
168.6 |
|
| Other assets |
|
71.3 |
|
|
|
48.0 |
|
| Total assets |
$ |
2,271.1 |
|
|
$ |
2,236.7 |
|
| |
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
233.0 |
|
|
$ |
211.3 |
|
|
Current operating lease obligations |
|
42.0 |
|
|
|
45.1 |
|
|
Employee compensation |
|
135.2 |
|
|
|
166.1 |
|
|
Employee benefit plan obligations |
|
30.3 |
|
|
|
39.9 |
|
|
Accrued promotions |
|
24.6 |
|
|
|
19.4 |
|
|
Customer deposits |
|
49.9 |
|
|
|
44.8 |
|
|
Other current liabilities |
|
102.6 |
|
|
|
80.5 |
|
| Total current liabilities |
|
617.6 |
|
|
|
607.1 |
|
| |
|
|
|
| Long-term liabilities: |
|
|
|
|
Long-term debt |
|
446.7 |
|
|
|
446.3 |
|
|
Employee benefit plan obligations |
|
101.4 |
|
|
|
104.5 |
|
|
Long-term operating lease obligations |
|
122.1 |
|
|
|
138.6 |
|
|
Other long-term liabilities |
|
50.3 |
|
|
|
53.1 |
|
| Total long-term
liabilities |
|
720.5 |
|
|
|
742.5 |
|
| Total liabilities |
|
1,338.1 |
|
|
|
1,349.6 |
|
| |
|
|
|
| Shareholders’ equity: |
|
|
|
|
Additional paid-in capital |
|
28.9 |
|
|
|
41.2 |
|
|
Accumulated other comprehensive income (loss) |
|
(58.7 |
) |
|
|
(66.9 |
) |
|
Retained earnings |
|
962.8 |
|
|
|
912.8 |
|
| Total shareholders’
equity |
|
933.0 |
|
|
|
887.1 |
|
| Total liabilities and
shareholders’ equity |
$ |
2,271.1 |
|
|
$ |
2,236.7 |
|
|
STEELCASE INC. |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) |
|
(in millions) |
| |
|
|
|
|
|
Six Months Ended |
| |
August 23,2024 |
|
August 25,2023 |
| OPERATING
ACTIVITIES |
|
|
|
|
Net income |
$ |
74.0 |
|
|
$ |
29.0 |
|
| Adjustments to reconcile net
income to net cash provided by (used in) operating activities: |
|
|
|
|
Depreciation and amortization |
|
40.2 |
|
|
|
41.7 |
|
|
Share-based compensation |
|
18.0 |
|
|
|
18.5 |
|
|
Restructuring costs |
|
8.5 |
|
|
|
16.0 |
|
|
Gains on sales of fixed assets, net |
|
(41.7 |
) |
|
|
(5.1 |
) |
|
Other |
|
(3.2 |
) |
|
|
(3.4 |
) |
|
Changes in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
|
(13.7 |
) |
|
|
2.7 |
|
|
Inventories |
|
(9.3 |
) |
|
|
48.6 |
|
|
Cloud computing arrangements expenditures |
|
(22.6 |
) |
|
|
— |
|
|
Other assets |
|
3.7 |
|
|
|
(10.1 |
) |
|
Accounts payable |
|
17.3 |
|
|
|
22.5 |
|
|
Employee compensation liabilities |
|
(39.8 |
) |
|
|
(17.9 |
) |
|
Employee benefit obligations |
|
(14.5 |
) |
|
|
(10.9 |
) |
|
Accrued expenses and other liabilities |
|
32.1 |
|
|
|
(0.4 |
) |
| Net cash provided by operating
activities |
|
49.0 |
|
|
|
131.2 |
|
| |
|
|
|
| INVESTING
ACTIVITIES |
|
|
|
| Capital expenditures |
|
(24.6 |
) |
|
|
(24.3 |
) |
| Proceeds from disposal of
fixed assets |
|
44.3 |
|
|
|
15.7 |
|
| Purchases of short-term
investments |
|
(40.3 |
) |
|
|
— |
|
| Liquidations of short-term
investments |
|
1.7 |
|
|
|
— |
|
| Other |
|
3.0 |
|
|
|
(1.3 |
) |
| Net cash used in investing
activities |
|
(15.9 |
) |
|
|
(9.9 |
) |
| |
|
|
|
| FINANCING
ACTIVITIES |
|
|
|
| Dividends paid |
|
(24.0 |
) |
|
|
(23.9 |
) |
| Common stock repurchases |
|
(30.3 |
) |
|
|
(3.3 |
) |
| Borrowings on global committed
bank facility |
|
— |
|
|
|
69.0 |
|
| Repayments on global committed
bank facility |
|
— |
|
|
|
(69.0 |
) |
| Repayments on note
payable |
|
— |
|
|
|
(32.2 |
) |
| Other |
|
— |
|
|
|
1.7 |
|
| Net cash used in financing
activities |
|
(54.3 |
) |
|
|
(57.7 |
) |
| Effect of exchange rate
changes on cash and cash equivalents |
|
(0.8 |
) |
|
|
(0.2 |
) |
| Net decrease in cash, cash
equivalents and restricted cash |
|
(22.0 |
) |
|
|
63.4 |
|
| Cash and cash equivalents and
restricted cash, beginning of period (1) |
|
325.9 |
|
|
|
97.2 |
|
| Cash and cash equivalents and
restricted cash, end of period (2) |
$ |
303.9 |
|
|
$ |
160.6 |
|
(1) These amounts include restricted cash of $7.3 and $6.8
as of February 23, 2024 and February 24, 2023,
respectively.(2) These amounts include restricted cash of $7.3
and $7.0 as of August 23, 2024 and August 25, 2023,
respectively.
Restricted cash primarily represents funds held
in escrow for potential future workers’ compensation and product
liability claims. The restricted cash balance is included as
part of Other assets on the Condensed Consolidated Balance
Sheets.
|
CONTACT: |
Investor Contact: |
| |
Mike O'Meara |
| |
Investor Relations |
| |
ir@steelcase.com |
| |
|
| |
Media Contact: |
| |
Brodie Bertrand |
| |
Corporate Communications |
| |
communications@steelcase.com |
| |
|
| Source: Steelcase |
|
| SC-ERR |
|
Steelcase (NYSE:SCS)
過去 株価チャート
から 11 2024 まで 12 2024
Steelcase (NYSE:SCS)
過去 株価チャート
から 12 2023 まで 12 2024
