Steelcase Inc. (NYSE: SCS) today reported fourth quarter revenue of
$753.1 million and a net loss of $2.2 million, or $0.02 per share.
In the prior year, Steelcase reported revenue of $677.1 million and
net income of $6.6 million, or $0.06 per share.
Revenue increased 11 percent in the fourth quarter compared to
the prior year. The revenue growth was broad-based across all
segments, with 8 percent growth in the Americas, 18 percent growth
in EMEA and 19 percent growth in the Other category. On an organic
basis, revenue grew 12 percent, with 7 percent growth in the
Americas, 23 percent growth in EMEA and 19 percent growth in the
Other category. In the fourth quarter of the prior year, the
company estimates revenue benefited from shipment delays of
approximately $50 million in the Americas and approximately $10
million in EMEA due to a temporary operations shutdown in the third
quarter.
Orders (adjusted for the impact of acquisitions and currency
translation effects) grew 27 percent in the fourth quarter compared
to the prior year. Orders grew 29 percent in the Americas, 28
percent in EMEA and 9 percent in the Other category compared to the
prior year.
|
|
Q4 2022 vs. Q4 2021 |
|
|
|
RevenueGrowth |
|
Organic RevenueGrowth |
|
Organic OrderGrowth |
|
|
|
|
|
|
|
|
|
|
Americas |
8 |
% |
|
7 |
% |
|
29 |
% |
|
|
EMEA |
18 |
% |
|
23 |
% |
|
28 |
% |
|
|
Other category |
19 |
% |
|
19 |
% |
|
9 |
% |
|
|
Steelcase Inc. |
11 |
% |
|
12 |
% |
|
27 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
"Our order growth of 27 percent this quarter reflects the
investments our customers are making in their workplaces as they
increasingly invite their employees back to the office and seek
improved engagement, collaboration, focus and connection," said
Sara Armbruster, president and CEO. "We are pleased our
year-over-year order growth in the Americas has outpaced our
industry for each of the most recent five months of reported data.
Over that same period, in-office attendance in major U.S. cities
has increased, which we believe is supporting the growth we've been
seeing in the larger markets."
Fourth quarter operating income of $2.1 million represented a
decrease of $4.6 million compared to $6.7 million in the prior
year, which included a $1.6 million restructuring charge in the
Americas. The decrease was driven by lower gross margin and higher
operating expenses, partially offset by the benefits of higher
revenue. The Americas reported operating income of $3.6 million
compared to $12.1 million in the prior year. EMEA reported
operating income of $2.3 million compared to an operating loss of
$0.5 million in the prior year. The Other category reported
operating income of $4.3 million compared to $2.9 million in the
prior year.
Gross margin of 26.1 percent in the fourth quarter represented a
decrease of 230 basis points compared to the prior year, with a 310
basis point decline in the Americas, an 80 basis point decline in
EMEA and a 160 basis point decline in the Other category. The
decline in the Americas was due to approximately $22 million of
higher inflation, net of pricing benefits, and approximately $9
million of higher freight and labor costs and inefficiencies
associated with the supply chain disruptions in the current year,
partially offset by the benefits of higher revenue. The decline in
EMEA was primarily due to higher freight costs associated with
supply chain disruptions, while the decline in the Other category
was due to higher inflation, net of pricing benefits.
"Continued inflation, net of pricing benefits, and supply chain
disruption costs impacted our earnings in the quarter by over $30
million, or approximately $0.15 per share," said Dave Sylvester,
senior vice president and CFO. "During the quarter, we announced an
unprecedented fourth price increase in twelve months in response to
the ongoing significant inflation. We’re also continuing to make
adjustments in our supply chain and within our operations aimed at
improving the reliability of our delivery dates to customers and
reducing the freight and labor costs we've been incurring."
Operating expenses of $194.3 million in the fourth quarter
represented an increase of $8.6 million, but a decline of 160 basis
points as a percentage of revenue, compared to the prior year. The
current year included approximately $9 million of higher marketing,
product development and sales expenses, $4.7 million from
acquisitions and approximately $4 million of higher discretionary
spending and employee costs in other functional areas, partially
offset by $9.2 million of lower variable compensation expense.
Total liquidity, comprised of cash and cash equivalents and the
cash surrender value of company-owned life insurance, aggregated to
$368.9 million at the end of the fourth quarter. Total debt was
$482.5 million.
The Board of Directors has declared a quarterly cash dividend of
$0.145 per share, to be paid on or before April 14, 2022, to
shareholders of record as of April 4, 2022.
Fiscal 2022 Results
For fiscal 2022, the company recorded $2.8 billion of revenue
and net income of $4.0 million, or earnings per share of $0.03. In
fiscal 2021, the company recorded $2.6 billion of revenue, net
income of $26.1 million, earnings per share of $0.22 and adjusted
earnings per share of $0.52.
Revenue increased 7 percent in fiscal 2022, with a 3 percent
increase in the Americas, a 17 percent increase in EMEA and a 14
percent increase in the Other category. On an organic basis, fiscal
2022 revenue represented an increase of 4 percent compared to the
prior year, with a 1 percent increase in the Americas, a 15 percent
increase in EMEA and a 12 percent increase in the Other
category.
Operating income for fiscal 2022 of $20.1 million declined
compared to $43.0 million of operating income for fiscal 2021, and
represented a $69.1 million decrease compared to $89.2 of adjusted
operating income for fiscal 2021. The decrease was driven by
approximately $80 million of inflation, net of pricing benefits,
approximately $26 million of higher freight and labor costs and
inefficiencies associated with supply chain disruptions, and $57.2
million of higher operating expenses, partially offset by the
benefits from higher revenue. Operating expenses in the prior year
benefited from approximately $41 million of lower employee costs as
a result of temporary hour and pay reductions.
"Fiscal 2022 brought significant challenges to our business, but
our teams rallied to implement actions to address the supply chain
challenges and inflationary pressures and drove 25 percent order
growth as we focused on executing our strategy to help people work
better," said Sara Armbruster.
Outlook
At the end of the fourth quarter, the company’s backlog of
customer orders was approximately $787 million, which was 77
percent higher than the prior year. Consistent with recent
quarters, the backlog includes a higher than historical percentage
of orders scheduled to ship beyond the end of the next quarter, and
supply chain disruptions are expected to continue. As a result, the
company expects first quarter fiscal 2023 revenue to be in the
range of $680 to $705 million. The company reported revenue of
$556.6 million in the first quarter of fiscal 2022. The projected
revenue translates to growth of 22 to 27 percent compared to the
first quarter of fiscal 2022, or organic growth of 24 to 28
percent.
The company expects to report a loss per share of between $0.15
to $0.20 for the first quarter of fiscal 2023, which compares to a
reported loss of $0.24 per share in the prior year. The estimate
includes: (1) projected inflation, net of pricing benefits, of
approximately $10 million as compared to the prior year, (2)
projected operating expenses of between $195 to $200 million, (3)
projected interest expense, investment income and other income,
net, of approximately $4 million, and (4) a projected effective tax
rate of 27 percent.
For fiscal 2023 the company is targeting organic revenue growth
of 15 to 20 percent and earnings per share of between $0.50 to
$0.70.
The fiscal 2023 targets reflect the following assumptions and
expectations:
- higher demand driven by increased return to office and
investments to support hybrid work
- pricing benefits, net of inflation, of between $120 to $140
million compared to fiscal 2022
- the impacts of supply chain disruptions abating modestly over
the year
- operating expenses of between $880 to $900 million, including
higher investments in marketing, product development and sales,
increased discretionary spending, and higher variable compensation
and other employee costs
- approximately $16 million of interest expense, investment
income and other income, net
- an effective tax rate of 27 percent
The company is targeting net income in the second quarter which
would more than offset the first quarter net loss driven by
seasonally higher revenue and higher pricing benefits.
"In fiscal 2023, we expect to realize more of the benefits from
the momentum we've been seeing in our order patterns, as our
pricing actions catch up with inflation and the impacts from supply
chain disruptions abate," said Sara Armbruster. "We've remained
focused on the changing needs of people and organizations through
our research, and we've centered our product development
investments on solving for these needs. We expect this focus will
drive additional growth as companies update their workplaces to
support a new era of hybrid work."
Business Segment
Results |
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|
(in millions) |
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|
|
|
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|
(Unaudited) |
|
|
|
(Unaudited) |
|
|
|
Three Months Ended |
|
|
|
Twelve Months Ended |
|
|
|
February 25,2022 |
|
February 26,2021 |
|
% Change |
|
February 25,2022 |
|
February 26,2021 |
|
% Change |
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Revenue |
|
|
|
|
|
|
|
|
|
|
|
Americas (1) |
$ |
505.1 |
|
$ |
467.0 |
|
8 |
% |
|
$ |
1,905.0 |
|
$ |
1,848.5 |
|
3 |
% |
EMEA (2) |
|
167.8 |
|
|
142.6 |
|
18 |
% |
|
|
598.5 |
|
|
511.3 |
|
17 |
% |
Other (3) |
|
80.2 |
|
|
67.5 |
|
19 |
% |
|
|
269.2 |
|
|
236.4 |
|
14 |
% |
Consolidated revenue |
$ |
753.1 |
|
$ |
677.1 |
|
11 |
% |
|
$ |
2,772.7 |
|
$ |
2,596.2 |
|
7 |
% |
Operating income
(loss) |
|
|
|
|
|
|
|
|
|
|
|
Americas |
$ |
3.6 |
|
|
$ |
12.1 |
|
|
|
|
$ |
44.4 |
|
|
$ |
97.0 |
|
|
|
EMEA |
|
2.3 |
|
|
|
(0.5 |
) |
|
|
|
|
3.3 |
|
|
|
(32.3 |
) |
|
|
Other |
|
4.3 |
|
|
|
2.9 |
|
|
|
|
|
(3.2 |
) |
|
|
0.2 |
|
|
|
Corporate (4) |
|
(8.1 |
) |
|
|
(7.8 |
) |
|
|
|
|
(24.4 |
) |
|
|
(21.9 |
) |
|
|
Consolidated operating income |
$ |
2.1 |
|
|
$ |
6.7 |
|
|
|
|
$ |
20.1 |
|
|
$ |
43.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
percent |
|
0.3 |
% |
|
|
1.0 |
% |
|
|
|
|
0.7 |
% |
|
|
1.7 |
% |
|
|
Revenue
mix |
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
67.1 |
% |
|
69.0 |
% |
|
|
|
68.7 |
% |
|
71.2 |
% |
|
|
|
EMEA |
22.3 |
% |
|
21.1 |
% |
|
|
|
21.6 |
% |
|
19.7 |
% |
|
|
|
Other |
10.6 |
% |
|
9.9 |
% |
|
|
|
9.7 |
% |
|
9.1 |
% |
|
|
|
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 and technology products marketed to
corporate, government, healthcare, education and retail customers
through the Steelcase, Coalesse, Smith System, AMQ, Orangebox and
Viccarbe brands.
- The EMEA segment serves customers in Europe, the Middle East
and Africa primarily under the Steelcase, Orangebox, Coalesse and
Viccarbe brands, with a comprehensive portfolio of furniture,
architectural and technology products.
- The Other category includes Asia Pacific and Designtex. Asia
Pacific serves customers in Australia, China, India, Japan, Korea
and other countries in Southeast Asia primarily under the Steelcase
brand with a comprehensive portfolio of furniture, architectural
and technology products. Designtex primarily sells textiles, wall
coverings and surface imaging solutions specified by architects and
designers directly to end-use customers through a direct sales
force primarily in North America.
- Corporate costs include unallocated portions of shared service
functions such as information technology, corporate facilities,
finance, human resources, research, legal and customer aviation,
plus deferred compensation expense and income or losses associated
with company-owned life insurance.
|
QUARTER
OVER QUARTER ORGANIC REVENUE GROWTH BY SEGMENT |
Q4 2022 vs. Q4
2021 |
|
|
|
|
|
|
|
|
Steelcase Inc. |
|
Americas |
|
EMEA |
|
Other category |
|
|
|
|
|
|
|
|
Q4 2021 revenue |
$ |
677.1 |
|
|
$ |
467.0 |
|
|
$ |
142.6 |
|
|
$ |
67.5 |
|
Acquisitions |
|
6.0 |
|
|
|
3.7 |
|
|
|
2.3 |
|
|
|
— |
|
Currency translation
effects* |
|
(8.1 |
) |
|
|
0.3 |
|
|
|
(8.1 |
) |
|
|
(0.3 |
) |
Q4 2021 revenue, adjusted |
|
675.0 |
|
|
|
471.0 |
|
|
|
136.8 |
|
|
|
67.2 |
|
|
|
|
|
|
|
|
|
Q4 2022 revenue |
|
753.1 |
|
|
|
505.1 |
|
|
|
167.8 |
|
|
|
80.2 |
|
Organic growth $ |
$ |
78.1 |
|
|
$ |
34.1 |
|
|
$ |
31.0 |
|
|
$ |
13.0 |
|
Organic growth % |
|
12 |
% |
|
|
7 |
% |
|
|
23 |
% |
|
|
19 |
% |
|
|
|
|
|
|
|
|
* Currency
translation effects represent the estimated net effect of
translating Q4 2021 foreign currency revenues using the average
exchange rates during Q4 2022. |
|
YEAR OVER
YEAR ORGANIC REVENUE GROWTH BY SEGMENT |
2022 vs.
2021 |
|
|
|
|
|
|
|
|
Steelcase Inc. |
|
Americas |
|
EMEA |
|
Other category |
|
|
|
|
|
|
|
|
2021 revenue |
$ |
2,596.2 |
|
|
$ |
1,848.5 |
|
|
$ |
511.3 |
|
|
$ |
236.4 |
|
Acquisitions |
|
44.8 |
|
|
|
41.8 |
|
|
|
3.0 |
|
|
|
— |
|
Currency translation
effects* |
|
16.0 |
|
|
|
5.2 |
|
|
|
7.5 |
|
|
|
3.3 |
|
2021 revenue, adjusted |
|
2,657.0 |
|
|
|
1,895.5 |
|
|
|
521.8 |
|
|
|
239.7 |
|
|
|
|
|
|
|
|
|
2022 revenue |
|
2,772.7 |
|
|
|
1,905.0 |
|
|
|
598.5 |
|
|
|
269.2 |
|
Organic growth $ |
$ |
115.7 |
|
|
$ |
9.5 |
|
|
$ |
76.7 |
|
|
$ |
29.5 |
|
Organic growth % |
|
4 |
% |
|
|
1 |
% |
|
|
15 |
% |
|
|
12 |
% |
|
|
|
|
|
|
|
|
* Currency
translation effects represent the estimated net effect of
translating 2021 foreign currency revenues using the average
exchange rates during 2022. |
|
PROJECTED
ORGANIC REVENUE GROWTH |
Q1 2023 vs. Q1 2022 |
|
|
|
|
|
Steelcase Inc. |
|
|
|
|
|
|
Q1 2022 revenue |
$ |
556.6 |
|
|
Acquisitions |
|
3.5 |
|
|
Currency translation
effects* |
|
(11.1 |
) |
|
Q1 2022 revenue, adjusted |
$ |
549.0 |
|
|
|
|
|
|
|
Q1 2023 revenue,
projected |
$ |
680 - 705 |
|
|
Organic growth $ |
$ |
131 - 156 |
|
|
Organic growth % |
|
24% - 28 |
% |
|
|
|
|
|
|
* Currency
translation effects represent the estimated net effect of
translating Q1 2023 foreign currency revenues using the exchange
rates at the end of Q4 2022. |
PROJECTED
ORGANIC REVENUE GROWTH |
2023 vs.
2022 |
|
|
|
|
Steelcase Inc. |
|
|
|
|
|
2022 revenue |
$ |
2,772.7 |
|
|
Acquisitions |
|
9.2 |
|
|
Currency translation
effects* |
|
(27.0 |
) |
|
2022 revenue, adjusted |
$ |
2,754.9 |
|
|
|
|
|
|
|
2023 revenue, projected |
$ |
3,175 - 3,300 |
|
|
Organic growth $ |
$ |
420 - 545 |
|
|
Organic growth % |
|
15% - 20 |
% |
|
|
|
|
|
* Currency
translation effects represent the estimated net effect of
translating 2023 foreign currency revenues using the exchange rates
at the end of 2022. |
ADJUSTED
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
Twelve Months Ended |
|
|
|
February 25,2022 |
|
February 26,2021 |
|
Earnings per share |
|
$ |
0.03 |
|
$ |
0.22 |
|
|
Goodwill impairment charge,
per share |
|
|
— |
|
|
0.15 |
|
|
Restructuring costs, per
share |
|
|
— |
|
|
0.24 |
|
|
Income tax effect of
restructuring costs, per share |
|
|
— |
|
|
(0.09 |
) |
|
Adjusted earnings per
share |
|
$ |
0.03 |
|
$ |
0.52 |
|
|
Steelcase
Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
Three Months Ended |
|
|
Twelve Months Ended |
|
February 25,2022 |
|
|
February 26,2021 |
|
February 25,2022 |
|
February 26,2021 |
Revenue |
$ |
753.1 |
|
|
100.0 |
% |
|
$ |
677.1 |
|
|
100.0 |
% |
|
$ |
2,772.7 |
|
|
100.0 |
% |
|
$ |
2,596.2 |
|
|
100.0 |
% |
Cost of sales |
|
556.7 |
|
|
73.9 |
|
|
|
483.1 |
|
|
71.4 |
|
|
|
2,011.2 |
|
|
72.5 |
|
|
|
1,822.8 |
|
|
70.2 |
|
Restructuring costs |
|
— |
|
|
— |
|
|
|
1.4 |
|
|
0.2 |
|
|
|
— |
|
|
— |
|
|
|
10.6 |
|
|
0.4 |
|
Gross profit |
|
196.4 |
|
|
26.1 |
|
|
|
192.6 |
|
|
28.4 |
|
|
|
761.5 |
|
|
27.5 |
|
|
|
762.8 |
|
|
29.4 |
|
Operating expenses |
|
194.3 |
|
|
25.8 |
|
|
|
185.7 |
|
|
27.4 |
|
|
|
741.4 |
|
|
26.8 |
|
|
|
684.2 |
|
|
26.4 |
|
Goodwill impairment
charge |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
17.6 |
|
|
0.6 |
|
Restructuring costs |
|
— |
|
|
— |
|
|
|
0.2 |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
18.0 |
|
|
0.7 |
|
Operating income |
$ |
2.1 |
|
|
0.3 |
% |
|
$ |
6.7 |
|
|
1.0 |
% |
|
$ |
20.1 |
|
|
0.7 |
% |
|
$ |
43.0 |
|
|
1.7 |
% |
Interest expense |
|
(6.4 |
) |
|
(0.8 |
) |
|
|
(6.4 |
) |
|
(0.9 |
) |
|
|
(25.7 |
) |
|
(0.9 |
) |
|
|
(27.1 |
) |
|
(1.1 |
) |
Investment income |
|
0.2 |
|
|
— |
|
|
|
0.2 |
|
|
— |
|
|
|
0.6 |
|
|
— |
|
|
|
1.4 |
|
|
0.1 |
|
Other income, net |
|
3.1 |
|
|
0.4 |
|
|
|
1.6 |
|
|
0.2 |
|
|
|
6.6 |
|
|
0.2 |
|
|
|
8.6 |
|
|
0.3 |
|
Income before income tax
expense (benefit) |
|
(1.0 |
) |
|
(0.1 |
) |
|
|
2.1 |
|
|
0.3 |
|
|
|
1.6 |
|
|
— |
|
|
|
25.9 |
|
|
1.0 |
|
Income tax expense
(benefit) |
|
1.2 |
|
|
0.2 |
|
|
|
(4.5 |
) |
|
(0.7 |
) |
|
|
(2.4 |
) |
|
(0.1 |
) |
|
|
(0.2 |
) |
|
— |
|
Net income (loss) |
$ |
(2.2 |
) |
|
(0.3 |
)% |
|
$ |
6.6 |
|
|
1.0 |
% |
|
$ |
4.0 |
|
|
0.1 |
% |
|
$ |
26.1 |
|
|
1.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
$ |
2.1 |
|
|
0.3 |
% |
|
$ |
6.7 |
|
|
1.0 |
% |
|
$ |
20.1 |
|
|
0.7 |
% |
|
$ |
43.0 |
|
|
1.7 |
% |
Add: goodwill impairment
charge |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
17.6 |
|
|
0.6 |
|
Add: restructuring costs |
|
— |
|
|
— |
|
|
|
1.6 |
|
|
0.2 |
|
|
|
— |
|
|
— |
|
|
|
28.6 |
|
|
1.1 |
|
Adjusted operating income |
$ |
2.1 |
|
|
0.3 |
% |
|
$ |
8.3 |
|
|
1.2 |
% |
|
$ |
20.1 |
|
|
0.7 |
% |
|
$ |
89.2 |
|
|
3.4 |
% |
Americas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
Three Months Ended |
|
Twelve Months Ended |
|
February 25,2022 |
|
February 26,2021 |
|
February 25,2022 |
|
February 26,2021 |
Revenue |
$ |
505.1 |
|
100.0 |
% |
|
$ |
467.0 |
|
100.0 |
% |
|
$ |
1,905.0 |
|
100.0 |
% |
|
$ |
1,848.5 |
|
100.0 |
% |
Cost of sales |
|
378.6 |
|
75.0 |
|
|
|
334.3 |
|
71.6 |
|
|
|
1,394.0 |
|
73.2 |
|
|
|
1,285.1 |
|
69.5 |
|
Restructuring costs |
|
— |
|
— |
|
|
|
1.4 |
|
0.3 |
|
|
|
— |
|
— |
|
|
|
10.6 |
|
0.6 |
|
Gross profit |
|
126.5 |
|
25.0 |
|
|
|
131.3 |
|
28.1 |
|
|
|
511.0 |
|
26.8 |
|
|
|
552.8 |
|
29.9 |
|
Operating expenses |
|
122.9 |
|
24.3 |
|
|
|
119.0 |
|
25.5 |
|
|
|
466.6 |
|
24.5 |
|
|
|
437.8 |
|
23.7 |
|
Restructuring costs |
|
— |
|
— |
|
|
|
0.2 |
|
— |
|
|
|
— |
|
— |
|
|
|
18.0 |
|
1.0 |
|
Operating income |
$ |
3.6 |
|
0.7 |
% |
|
$ |
12.1 |
|
2.6 |
% |
|
$ |
44.4 |
|
2.3 |
% |
|
$ |
97.0 |
|
5.2 |
% |
Add: restructuring costs |
|
— |
|
— |
|
|
|
1.6 |
|
0.3 |
|
|
|
— |
|
— |
|
|
|
28.6 |
|
1.6 |
|
Adjusted operating income |
$ |
3.6 |
|
0.7 |
% |
|
$ |
13.7 |
|
2.9 |
% |
|
$ |
44.4 |
|
2.3 |
% |
|
$ |
125.6 |
|
6.8 |
% |
EMEA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
Three Months Ended |
|
Twelve Months Ended |
|
February 25,2022 |
|
February 26,2021 |
|
February 25,2022 |
|
February 26,2021 |
Revenue |
$ |
167.8 |
|
100.0 |
% |
|
$ |
142.6 |
|
|
100.0 |
% |
|
$ |
598.5 |
|
100.0 |
% |
|
$ |
511.3 |
|
|
100.0 |
% |
Cost of sales |
|
123.6 |
|
73.7 |
|
|
|
104.0 |
|
|
72.9 |
|
|
|
432.6 |
|
72.3 |
|
|
|
380.4 |
|
|
74.4 |
|
Gross profit |
|
44.2 |
|
26.3 |
|
|
|
38.6 |
|
|
27.1 |
|
|
|
165.9 |
|
27.7 |
|
|
|
130.9 |
|
|
25.6 |
|
Operating expenses |
|
41.9 |
|
24.9 |
|
|
|
39.1 |
|
|
27.5 |
|
|
|
162.6 |
|
27.1 |
|
|
|
145.6 |
|
|
28.5 |
|
Goodwill impairment
charge |
|
— |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
— |
|
|
|
17.6 |
|
|
3.4 |
|
Operating income (loss) |
$ |
2.3 |
|
1.4 |
% |
|
$ |
(0.5 |
) |
|
(0.4 |
)% |
|
$ |
3.3 |
|
0.6 |
% |
|
$ |
(32.3 |
) |
|
(6.3 |
)% |
Add: goodwill impairment
charge |
|
— |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
— |
|
|
|
17.6 |
|
|
3.4 |
|
Adjusted operating income
(loss) |
$ |
2.3 |
|
1.4 |
% |
|
$ |
(0.5 |
) |
|
(0.4 |
)% |
|
$ |
3.3 |
|
0.6 |
% |
|
$ |
(14.7 |
) |
|
(2.9 |
)% |
Other
category |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
February 25,2022 |
|
February 26,2021 |
|
February 25,2022 |
|
|
February 26,2021 |
Revenue |
$ |
80.2 |
|
100.0 |
% |
|
$ |
67.5 |
|
100.0 |
% |
|
$ |
269.2 |
|
|
100.0 |
% |
|
$ |
236.4 |
|
100.0 |
% |
Cost of sales |
|
54.5 |
|
68.0 |
|
|
|
44.8 |
|
66.4 |
|
|
|
184.6 |
|
|
68.6 |
|
|
|
157.3 |
|
66.5 |
|
Gross profit |
|
25.7 |
|
32.0 |
|
|
|
22.7 |
|
33.6 |
|
|
|
84.6 |
|
|
31.4 |
|
|
|
79.1 |
|
33.5 |
|
Operating expenses |
|
21.4 |
|
26.6 |
|
|
|
19.8 |
|
29.3 |
|
|
|
87.8 |
|
|
32.6 |
|
|
|
78.9 |
|
33.4 |
|
Operating income (loss) |
$ |
4.3 |
|
5.4 |
% |
|
$ |
2.9 |
|
4.3 |
% |
|
$ |
(3.2 |
) |
|
(1.2 |
)% |
|
$ |
0.2 |
|
0.1 |
% |
Corporate |
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
Three Months Ended |
|
Twelve Months Ended |
|
February 25,2022 |
|
February 26,2021 |
|
February 25,2022 |
|
February 26,2021 |
Operating expenses |
$ |
8.1 |
|
|
$ |
7.8 |
|
|
$ |
24.4 |
|
|
$ |
21.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WebcastSteelcase will discuss fourth quarter
results and business outlook on a conference call at 8:30 a.m.
Eastern time tomorrow.
Non-GAAP Financial MeasuresThis earnings
release contains 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 consolidated statements of
operations, balance sheets or statements of cash flows of the
company. Pursuant to the requirements of Regulation G, the
company has provided a reconciliation above of the non-GAAP
financial measures to the most directly comparable GAAP financial
measures.
The non-GAAP financial measures used within this earnings
release are: (1) organic revenue growth, which represents the
change in revenue excluding the impacts of acquisitions and
divestitures and estimated currency translation effects; (2)
adjusted earnings per share, which represents earnings per share
excluding (a) goodwill impairment charges and (b) restructuring
costs and related tax effects; and (3) adjusted operating income
(loss), which represents operating income (loss) excluding goodwill
impairment charges and restructuring costs. These measures are
presented because management uses this information to monitor and
evaluate financial results and trends. Therefore, management
believes this information is also useful for investors.
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 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; the COVID-19 pandemic and the actions taken by
various governments and third parties to combat the pandemic;
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.Organizations around the
world trust Steelcase to help them create workplaces that help
people work better, be inspired and accomplish more. The company
designs, manufactures and partners with other leading organizations
to provide architecture, furniture and technology solutions –
accessible through a network of channels, including over 800
Steelcase dealer locations. Steelcase is a global, industry-leading
and publicly traded company with fiscal 2022 revenue of $2.8
billion. For more information, visit www.steelcase.com.
|
STEELCASE INC. |
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) |
(in millions, except per share data) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
February 25,2022 |
|
February 26,2021 |
|
February 25,2022 |
|
February 26,2021 |
Revenue |
$ |
753.1 |
|
|
$ |
677.1 |
|
|
$ |
2,772.7 |
|
|
$ |
2,596.2 |
|
Cost of sales |
|
556.7 |
|
|
|
483.1 |
|
|
|
2,011.2 |
|
|
|
1,822.8 |
|
Restructuring costs |
|
— |
|
|
|
1.4 |
|
|
|
— |
|
|
|
10.6 |
|
Gross profit |
|
196.4 |
|
|
|
192.6 |
|
|
|
761.5 |
|
|
|
762.8 |
|
Operating expenses |
|
194.3 |
|
|
|
185.7 |
|
|
|
741.4 |
|
|
|
684.2 |
|
Goodwill impairment
charge |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
17.6 |
|
Restructuring costs |
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
18.0 |
|
Operating income |
|
2.1 |
|
|
|
6.7 |
|
|
|
20.1 |
|
|
|
43.0 |
|
Interest expense |
|
(6.4 |
) |
|
|
(6.4 |
) |
|
|
(25.7 |
) |
|
|
(27.1 |
) |
Investment income |
|
0.2 |
|
|
|
0.2 |
|
|
|
0.6 |
|
|
|
1.4 |
|
Other income, net |
|
3.1 |
|
|
|
1.6 |
|
|
|
6.6 |
|
|
|
8.6 |
|
Income (loss) before income tax expense (benefit) |
|
(1.0 |
) |
|
|
2.1 |
|
|
|
1.6 |
|
|
|
25.9 |
|
Income tax expense
(benefit) |
|
1.2 |
|
|
|
(4.5 |
) |
|
|
(2.4 |
) |
|
|
(0.2 |
) |
Net income (loss) |
$ |
(2.2 |
) |
|
$ |
6.6 |
|
|
$ |
4.0 |
|
|
$ |
26.1 |
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share: |
|
|
|
|
|
|
|
Basic |
$ |
(0.02 |
) |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
0.22 |
|
Diluted |
$ |
(0.02 |
) |
|
$ |
0.06 |
|
|
$ |
0.03 |
|
|
$ |
0.22 |
|
Weighted average shares
outstanding - basic |
|
115.8 |
|
|
|
117.8 |
|
|
|
117.0 |
|
|
|
117.5 |
|
Weighted average shares
outstanding - diluted |
|
115.8 |
|
|
|
118.2 |
|
|
|
117.4 |
|
|
|
117.8 |
|
|
|
|
|
|
|
|
|
Dividends declared and paid
per common share |
$ |
0.145 |
|
|
$ |
0.100 |
|
|
$ |
0.535 |
|
|
$ |
0.370 |
|
|
STEELCASE INC. |
CONSOLIDATED BALANCE SHEETS |
(in millions) |
|
(Unaudited) |
|
|
|
February 25,2022 |
|
February 26,2021 |
ASSETS |
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
200.9 |
|
|
$ |
489.8 |
|
Accounts receivable |
|
348.4 |
|
|
|
279.0 |
|
Allowance for doubtful accounts |
|
(8.0 |
) |
|
|
(8.7 |
) |
Inventories |
|
326.2 |
|
|
|
193.5 |
|
Prepaid expenses |
|
24.0 |
|
|
|
20.9 |
|
Income taxes receivable |
|
41.7 |
|
|
|
49.5 |
|
Other current assets |
|
26.0 |
|
|
|
21.4 |
|
Total current assets |
|
959.2 |
|
|
|
1,045.4 |
|
|
|
|
|
Property, plant and equipment,
net of accumulated depreciation of $1,089.0 and $1,063.2 |
|
392.8 |
|
|
|
410.8 |
|
Company-owned life insurance
("COLI") |
|
168.0 |
|
|
|
169.5 |
|
Deferred income taxes |
|
121.2 |
|
|
|
113.3 |
|
Goodwill |
|
242.8 |
|
|
|
218.1 |
|
Other intangible assets, net
of accumulated amortization of $86.4 and $73.3 |
|
85.5 |
|
|
|
90.4 |
|
Investments in unconsolidated
affiliates |
|
53.1 |
|
|
|
51.5 |
|
Right-of-use operating lease
assets |
|
209.8 |
|
|
|
225.4 |
|
Other assets |
|
28.6 |
|
|
|
29.6 |
|
Total assets |
$ |
2,261.0 |
|
|
$ |
2,354.0 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
Current liabilities: |
|
|
|
Accounts payable |
$ |
243.6 |
|
|
$ |
181.3 |
|
Short-term borrowings and current portion of long-term debt |
|
5.1 |
|
|
|
4.7 |
|
Current operating lease obligations |
|
44.2 |
|
|
|
43.8 |
|
Accrued expenses: |
|
|
|
Employee compensation |
|
75.6 |
|
|
|
90.1 |
|
Employee benefit plan obligations |
|
25.4 |
|
|
|
24.9 |
|
Accrued promotions |
|
32.9 |
|
|
|
27.8 |
|
Customer deposits |
|
53.4 |
|
|
|
33.7 |
|
Other |
|
87.0 |
|
|
|
108.7 |
|
Total current liabilities |
|
567.2 |
|
|
|
515.0 |
|
|
|
|
|
Long-term liabilities: |
|
|
|
Long-term debt less current maturities |
|
477.4 |
|
|
|
479.2 |
|
Employee benefit plan obligations |
|
126.7 |
|
|
|
152.9 |
|
Long-term operating lease obligations |
|
182.2 |
|
|
|
199.5 |
|
Other long-term liabilities |
|
55.3 |
|
|
|
46.9 |
|
Total long-term
liabilities |
|
841.6 |
|
|
|
878.5 |
|
Total liabilities |
|
1,408.8 |
|
|
|
1,393.5 |
|
|
|
|
|
Shareholders’ equity: |
|
|
|
Additional paid-in capital |
|
1.5 |
|
|
|
12.5 |
|
Accumulated other comprehensive income (loss) |
|
(50.6 |
) |
|
|
(40.0 |
) |
Retained earnings |
|
901.3 |
|
|
|
988.0 |
|
Total shareholders’
equity |
|
852.2 |
|
|
|
960.5 |
|
Total liabilities and
shareholders’ equity |
$ |
2,261.0 |
|
|
$ |
2,354.0 |
|
|
STEELCASE INC. |
CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited) |
(in millions) |
|
|
|
|
|
Twelve Months Ended |
|
February 25,2022 |
|
February 26,2021 |
OPERATING
ACTIVITIES |
|
|
|
Net income |
$ |
4.0 |
|
|
$ |
26.1 |
|
Depreciation and
amortization |
|
83.2 |
|
|
|
85.2 |
|
Goodwill impairment
charge |
|
— |
|
|
|
17.6 |
|
Restructuring costs |
|
— |
|
|
|
28.6 |
|
Deferred income taxes |
|
(14.1 |
) |
|
|
15.9 |
|
Non-cash stock
compensation |
|
16.1 |
|
|
|
20.9 |
|
Equity in income of
unconsolidated affiliates |
|
(7.8 |
) |
|
|
(9.3 |
) |
Dividends received from
unconsolidated affiliates |
|
5.5 |
|
|
|
8.1 |
|
Other |
|
(17.8 |
) |
|
|
(13.3 |
) |
Changes in operating assets
and liabilities: |
|
|
|
Accounts receivable |
|
(74.9 |
) |
|
|
120.9 |
|
Inventories |
|
(133.4 |
) |
|
|
27.1 |
|
Other assets |
|
(1.1 |
) |
|
|
(22.9 |
) |
Accounts payable |
|
62.9 |
|
|
|
(69.0 |
) |
Employee compensation liabilities |
|
(19.3 |
) |
|
|
(138.7 |
) |
Employee benefit obligations |
|
(15.4 |
) |
|
|
(22.6 |
) |
Customer deposits |
|
18.4 |
|
|
|
2.2 |
|
Accrued expenses and other liabilities |
|
(8.9 |
) |
|
|
(12.0 |
) |
Net cash provided by (used in)
operating activities |
|
(102.6 |
) |
|
|
64.8 |
|
|
|
|
|
INVESTING
ACTIVITIES |
|
|
|
Capital expenditures |
|
(60.5 |
) |
|
|
(41.3 |
) |
Proceeds from disposal of
fixed assets |
|
17.4 |
|
|
|
7.4 |
|
Acquisitions, net of cash
acquired |
|
(32.6 |
) |
|
|
(3.8 |
) |
Other |
|
10.2 |
|
|
|
7.1 |
|
Net cash used in investing
activities |
|
(65.5 |
) |
|
|
(30.6 |
) |
|
|
|
|
FINANCING
ACTIVITIES |
|
|
|
Dividends paid |
|
(62.6 |
) |
|
|
(43.5 |
) |
Common stock repurchases |
|
(55.2 |
) |
|
|
(42.7 |
) |
Borrowings on global committed
bank facility |
|
— |
|
|
|
250.0 |
|
Repayments on global committed
bank facility |
|
— |
|
|
|
(250.0 |
) |
Other |
|
(2.2 |
) |
|
|
(1.6 |
) |
Net cash used in financing
activities |
|
(120.0 |
) |
|
|
(87.8 |
) |
Effect of exchange rate
changes on cash and cash equivalents |
|
(0.5 |
) |
|
|
2.1 |
|
Net decrease in cash, cash
equivalents and restricted cash |
|
(288.6 |
) |
|
|
(51.5 |
) |
Cash and cash equivalents and
restricted cash, beginning of period (1) |
|
495.6 |
|
|
|
547.1 |
|
Cash and cash equivalents and
restricted cash, end of period (2) |
$ |
207.0 |
|
|
$ |
495.6 |
|
(1) These amounts include restricted cash of
$5.8 and $6.1 as of February 26, 2021 and February 28,
2020, respectively.
(2) These amounts include restricted cash of
$6.1 and $5.8 as of February 25, 2022 and February 26,
2021, respectively.
Restricted cash primarily represents funds held in escrow for
potential future workers’ compensation and product liability
claims. Restricted cash is included as part of Other assets on the
Consolidated Balance Sheets.
CONTACT: |
|
Investor Contact: |
|
|
Mike O'Meara |
|
|
Investor Relations |
|
|
(616) 246 - 4251 |
|
|
|
|
|
Media Contact: |
|
|
Katie Woodruff |
|
|
Corporate Communications |
|
|
(616) 915 - 8505 |
|
|
|
Source:
Steelcase |
SC-ERR |
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