Published in Manufacturing
Left: Andi Owen, Right: Jim Keane Left: Andi Owen, Right: Jim Keane COURTESY PHOTOS

Steelcase, Herman Miller report strong quarters as customers seek talent solutions

BY Friday, September 20, 2019 09:37am

Steelcase Inc. and Herman Miller Inc. each recorded strong sales results for their most recent quarters.

The Grand Rapids-based Steelcase (NYSE: SCS) on Thursday afternoon reported sales of $998 million for the three-month period that ended Aug. 23. That’s up nearly 14 percent from the same period a year earlier.

Steelcase reported net income of $60.5 million, or 50 cents per diluted share, for the second quarter of its 2020 fiscal year, which compares with $49.1 million, or 41 cents per diluted share, in the second quarter of its 2019 fiscal year.

The results included revenues from acquisitions. Minus acquisitions, sales grew 9 percent organically, the company said.

“We delivered one of our strongest quarters in the past 20 years, exceeding our expectations,” President and CEO Jim Keane said in Steelcase’s quarterly earnings statement. “These results demonstrate the effectiveness of our growth strategies and reflect the efforts of our employees around the world. Our new products are strengthening our portfolio in all geographies, our acquisitions and partnerships are providing additional solutions to our dealers and customers, and the war for talent continues to motivate organizations to invest in workspaces that inspire their people.”

Midway through the fiscal year, Steelcase grew sales more than 12 percent to $1.82 billion with six-month net income of $78.3 million, or 65 cents per diluted share.

Steelcase, which went into the prior period with a high order backlog, expects lower sales growth  of 2 percent to 5 percent to $920 million to $945 million for the current third quarter of its 2020 fiscal year, with net income of 33 cents to 37 cents per diluted share.

At Zeeland-based Herman Miller (Nasdaq: MLHR), sales for the first quarter of its 2020 fiscal year grew 7.7 percent to $670.9 million. Net income for the quarter totaled $48.2 million, or 81 cents per diluted share.

Herman Miller’s orders grew 6.9 percent during the quarter and backlogged orders increased 12.7 percent to $676.7 million.

The company projects sales in the present second quarter of its 2020 fiscal year in the range of $685 million to $705 million, a 5-percent to 8-percent increase from a year ago, with net income of 85 cents 89 cents per diluted share.

Looking ahead, Herman Miller sees “healthy levels of project opportunities in the pipeline,” CEO Andi Owen told brokerage analysts this week in a conference call to discuss results.

“We’ve been encouraged to have more and more discussions with their customers about how we can assist in their efforts around attracting and retaining talent and help them design flexible, high-performing workplaces,” Owen said. “If you look at the long-term in the last six months to 12 months, we aren’t seeing indicators out there that are concerning to us right now. Now, obviously, as everyone else is doing, we’re watching carefully. But right now, we really feel to work for talent. We really feel American companies and consumers are strong.”

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