8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)    May 5, 2015

KIMBALL INTERNATIONAL, INC.

________________________________________________________________________________________________________

(Exact name of registrant as specified in its charter)

Indiana	0-3279	35-0514506
(State or other jurisdiction of	(Commission File	(IRS Employer Identification No.)
incorporation)	Number)

1600 Royal Street, Jasper, Indiana	47549-1001
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code   (812) 482-1600

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02 Results of Operations and Financial Condition

On May 5, 2015, Kimball International, Inc. issued an earnings release for the quarter ended March 31, 2015.  The earnings release is attached as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure

Attached hereto as Exhibit 99.2 is an investor presentation that supplements the information to be discussed on the Kimball International, Inc. earnings call to be held on May 6, 2015 at 11:00 a.m. Eastern Time. The presentation attached as Exhibit 99.2 is incorporated into this Item 7.01 by reference.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

The following exhibits are furnished as part of this report:

Exhibit
Number	Description
99.1	Earnings Release dated May 5, 2015
99.2	Third Quarter Fiscal Year 2015 Investor Presentation dated May 5, 2015

The information in this Current Report on Form 8-K set forth in Item 2.02, Item 7.01, and Exhibits 99.1 and 99.2, is being furnished in accordance with the provisions of General Instruction B.2 of Form 8-K and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. The information contained in this Current Report on Form 8-K, including Exhibits 99.1 and 99.2, that is being furnished under Item 2.02 and Item 7.01 shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such filing.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	KIMBALL INTERNATIONAL, INC.
By:	/s/ Michelle R. Schroeder
	MICHELLE R. SCHROEDER Vice President, Chief Financial Officer

Date: May 5, 2015

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EXHIBIT INDEX

Exhibit
Number	Description
99.1	Earnings Release dated May 5, 2015
99.2	Third Quarter Fiscal Year 2015 Investor Presentation dated May 5, 2015

4

EX-99.1

Exhibit 99.1

KIMBALL INTERNATIONAL, INC. ANNOUNCES THIRD QUARTER FISCAL YEAR 2015 RESULTS

17% Top-Line Growth and Operational Improvements Drive Significant Increase in Operating Margin

JASPER, IN (May 5, 2015) - Kimball International, Inc. (NASDAQ: KBAL) today announced third quarter fiscal year 2015 net sales of $145.9 million and income from continuing operations of $4.9 million, or $0.13 per Class B diluted share.  Adjusted income from continuing operations for the third quarter of fiscal year 2015 was $5.3 million, or $0.14 per share, excluding charges related to a previously announced restructuring plan and the spin-off of the Company's Electronic Manufacturing Services segment.

Bob Schneider, Chairman and CEO, stated, “Our third quarter of fiscal year 2015 showed improvements in many areas. Normally the third quarter is our seasonally low quarter, but $145.9 million of sales this quarter was on par with sales in the first and second quarters of fiscal year 2015. Sales were up a strong 17% compared to the prior year third quarter, on increases within five of our six vertical markets. It is great to see broad-based improvement. Equally encouraging is our order backlog as of the end of the current year third quarter which is up 22% when compared to the order backlog last year at this time, and positions us well for top-line performance in the fourth quarter of fiscal year 2015. We are making nice progress in our journey to 8% operating income.”

On October 31, 2014, Kimball International spun off its Electronic Manufacturing Services segment. The following discussion excludes the results of the Electronic Manufacturing Services segment for all periods presented, except where indicated. All earnings per share figures represent Class B diluted earnings per share from continuing operations.

Overview

Financial Highlights (Amounts in Thousands, Except Per Share Data)	Three Months Ended
	March 31, 2015			March 31, 2014			Percent Change
Net Sales	$	145,943		$	125,108		17	%
Gross Profit	$	44,007		$	36,617		20	%
Gross Profit %	30.2		%	29.3		%
Selling and Administrative Expenses	$	38,508		$	37,692		2	%
Selling and Administrative Expenses %	26.4		%	30.2		%
Restructuring Expense	$	388		$	0
Operating Income (Loss)	$	5,111		$	(1,075	)	575	%
Operating Income (Loss) %	3.5		%	(0.9		%)
Adjusted Operating Income (Loss) *	$	5,725		$	(661	)	966	%
Adjusted Operating Income (Loss) % *	3.9		%	(0.5		%)
Income (Loss) from Continuing Operations	$	4,882		$	(37	)
Adjusted Income from Continuing Operations*	$	5,273		$	376		1,302	%
Diluted Earnings Per Share from Continuing Operations	$	0.13		$	0.00
Adjusted Diluted Earnings Per Share from Continuing Operations *	$	0.14		$	0.01		1,300	%

* Items indicated represent Non-GAAP measurements. See “Reconciliation of Non-GAAP Financial Measures” below.

• Net sales in the third quarter of fiscal year 2015 increased 17% from the prior year third quarter, primarily driven by increases in the hospitality and other commercial vertical markets. Net sales for the hospitality vertical increased 36% over the prior year, fueled by strong sales of non-custom hospitality furniture, both on hotel renovations and new hotel construction. The other commercial vertical, which is the largest portion of our business focused on a broad variety of customers, increased 21% over the prior year third quarter on strong day-to-day and project business aided by new product and marketing initiatives.

• Orders received during the fiscal year 2015third quarter increased 15% over the prior year third quarter. The other commercial, education, and healthcare vertical markets are experiencing increased demand in part driven by new products and marketing initiatives. Partially offsetting these increases was a decline in orders received in the finance vertical market.

• Third quarter gross profit as a percent of net sales increased 0.9 of a percentage point from the prior year third quarter. The increase was driven by price increases net of discounting, operational improvements, and strong cost controls which have enabled us to increase margins as sales volumes increase.

• Selling and administrative expenses in the third quarter of fiscal year 2015 declined as a percent of sales by 3.8 percentage points on leverage from higher sales volumes, but increased 2% in absolute dollars compared to the prior year. Higher commission expense related to the increased sales volumes and higher costs related to new product launches were partially offset by lower employee benefit expenses. Included in fiscal year 2015third quarter selling and administrative expenses are $0.2 million of pre-tax costs related to the spin-off of Kimball Electronics, as compared to $0.4 million pre-tax spin-off costs in the prior year third quarter.

• Pre-tax restructuring costs in the third quarter of fiscal year 2015 totaled $0.4 million and were related to the Company's previously announced restructuring plan to consolidate its metal fabrication production from an operation located in Post Falls, Idaho, into existing production facilities in Indiana, and to sell a Company plane that was used primarily for management travel. Included in pre-tax restructuring costs this quarter was a $0.2 million pre-tax gain from the sale of the Company plane, which partially offsets impairment recognized earlier in fiscal year 2015.

• The Company's 10.5% effective tax rate for the third quarter of fiscal year 2015 was lower than the prior year third quarter effective tax rate of 96.4%. The current year third quarter effective tax rate was favorably impacted by $1.5 million ($0.04 per share) of releases of income tax reserves upon the expiration of statutes of limitation and tax accrual adjustments. The prior year third quarter included favorable tax adjustments of $0.4 million ($0.01 per share).

• Operating cash flow for the third quarter of fiscal year 2015 was a positive cash flow of $10.3 million compared to a positive cash flow of $19.8 million in the third quarter of the prior year. The prior year figures include Kimball Electronics' operating cash flows, as cash management was centralized prior to the spin-off.

• The Company's cash and cash equivalents declined to $50.0 million at March 31, 2015, compared to June 30, 2014 cash and cash equivalents of $136.6 million (inclusive of Kimball Electronics). The decline was primarily due to the transfer of $63.0 million of cash to the Kimball Electronics subsidiary as of the October 31, 2014 spin-off date, at which time Kimball Electronics began operation as an independent company.

• The Company recently began to repurchase its shares pursuant to a previously announced stock repurchase program which allows for the repurchase of up to two million shares. During the third quarter, the Company acquired 316,000 shares of common stock at an aggregate purchase price of $3.1 million. Additionally the Company has paid $5.7 million of dividends to shareholders during fiscal year 2015, for a total year-to-date capital return to shareholders of $8.8 million.

Since the spin-off of the Electronics Manufacturing Services segment on October 31, 2014, the Company has taken significant steps to grow shareholder value as a furniture-focused company, including an announced restructuring resulting in the eventual closing of its Post Falls, Idaho manufacturing facility, following a transition of work to Company-owned facilities in southern Indiana, as well as the sale of a corporate jet focused on management usage. The sale of the corporate jet was completed during the Company’s third quarter.

Guidance

The consolidation of the Idaho manufacturing facility into other operations in southern Indiana is progressing according to plan with completion of the plan anticipated by September 2016. Estimated savings resulting from the consolidation activities are expected to be approximately $5 million annually thereafter. When the restructuring is complete and the savings are fully realized beginning in the quarter ending December 31, 2016, the Company expects operating income as a percent of net sales to be in the range of 7% to 8% for that quarter. Net sales in that quarter are expected to be in the range of $170 million to $180 million; operating income is expected in the range of $12 million to $14 million; the effective tax rate is expected to range from 35% to 38%; and earnings per diluted

share are expected to range from $0.20 to $0.24. At 8% operating income, return on capital would approach 20%, which is among the best in the office furniture industry.

Mr. Schneider concluded, “In our continuing effort to provide more transparent disclosures, we are providing guidance related to timing for the substantial completion of our restructuring actions and the resulting expected improvement in our operating income. Our team is very focused on significantly improving the profitability of Kimball with the successful exit of our Idaho facility being a significant component of reaching our 8% operating income goal.”

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures. A non-GAAP financial measure is 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 Generally Accepted Accounting Principles (“GAAP”) in the United States in the statement of income, statement of comprehensive income, balance sheet, or statement of cash flows of the Company. The non-GAAP financial measures used within this release include 1) operating income (loss) excluding spin-off expenses and restructuring charges, 2) income (loss) from continuing operations excluding spin-off expenses and restructuring charges, and 3) diluted earnings (loss) per share from continuing operations excluding spin-off expenses and restructuring charges. Reconciliations of the reported GAAP numbers to these non-GAAP financial measures are included in the Financial Highlights table below. Management believes it is useful for investors to understand how its core operations performed without spin-off expenses and costs incurred in executing its restructuring plans. Excluding these amounts allows investors to meaningfully trend, analyze, and benchmark the performance of the Company's core operations. Many of the Company's internal performance measures that management uses to make certain operating decisions exclude these charges to enable meaningful trending of core operating metrics.

Forward-Looking Statements

Certain statements contained within this release are considered forward-looking under the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties including, but not limited to, the risk that any projections or guidance, including revenues, margins, earnings, or any other financial results are not realized, the successful completion of the restructuring plan, our ability to fully realize the expected benefits of the spin-off and restructuring plan, adverse changes in the global economic conditions, significant volume reductions from key contract customers, significant reduction in customer order patterns, financial stability of key customers and suppliers, and availability or cost of raw materials. Additional cautionary statements regarding other risk factors that could have an effect on the future performance of the Company are contained in the Company's Form 10-K filing for the fiscal year ended June 30, 2014 and other filings with the Securities and Exchange Commission.

Conference Call / Webcast
Date:	May 6, 2015
Time:	11:00 AM Eastern Time
Dial-In #:	877-280-4961 (International Calls - 857-244-7318)
Pass Code:	Kimball

A webcast of the live conference call may be accessed by visiting Kimball's Investor Relations website at www.ir.kimball.com.

For those unable to participate in the live webcast, the call will be archived at www.ir.kimball.com within two hours of the conclusion of the live call.

About Kimball International, Inc.

Kimball International, Inc. is a leading manufacturer of design driven, technology savvy, high quality furnishings sold under the Company’s family of brands: National Office Furniture, Kimball Office and Kimball Hospitality. Our diverse portfolio provides solutions for the workplace, learning, healing and hospitality environments. Customers can access our products globally through a variety of distribution channels.  Recognized with a reputation for excellence as a trustworthy company by Forbes, Kimball International is committed to a high performance culture that is committed to sound ethics, continuous improvement and social responsibility. To learn more about Kimball International, Inc. (NASDAQ: KBAL) visit www.kimball.com.

"We Build Success"

Financial highlights for the third quarter ended March 31, 2015 are as follows:

Condensed Consolidated Statements of Income
(Unaudited)	Three Months Ended
(Amounts in Thousands, except per share data)	March 31, 2015				March 31, 2014
Net Sales	$	145,943	100.0	%	$	125,108		100.0	%
Cost of Sales	101,936		69.8	%	88,491			70.7	%
Gross Profit	44,007		30.2	%	36,617			29.3	%
Selling and Administrative Expenses	38,508		26.4	%	37,692			30.2	%
Restructuring Expense	388		0.3	%	0			0.0	%
Operating Income (Loss)	5,111		3.5	%	(1,075		)	(0.9	%)
Other Income, net	345		0.2	%	39			0.1	%
Income (Loss) from Continuing Operations Before Taxes on Income	5,456		3.7	%	(1,036		)	(0.8	%)
Provision (Benefit) for Income Taxes	574		0.4	%	(999		)	(0.8	%)
Income (Loss) from Continuing Operations	4,882		3.3	%	(37		)	0.0	%
Income from Discontinued Operations, Net of Tax	0		0.0	%	7,245			5.8	%
Net Income	$	4,882	3.3	%	$	7,208		5.8	%
Earnings Per Share of Common Stock:
Basic from Continuing Operations	$	0.13			$	0.00
Diluted from Continuing Operations	$	0.13			$	0.00
Basic	$	0.13			$	0.19
Diluted	$	0.13			$	0.19
Average Number of Total Shares Outstanding
Basic	38,747				38,437
Diluted	39,115				38,437

(Unaudited)	Nine Months Ended
(Amounts in Thousands, except per share data)	March 31, 2015				March 31, 2014
Net Sales	$	441,807	100.0	%	$	405,959	100.0	%
Cost of Sales	304,021		68.8	%	281,290		69.3	%
Gross Profit	137,786		31.2	%	124,669		30.7	%
Selling and Administrative Expenses	125,435		28.4	%	122,606		30.2	%
Restructuring Expense	3,723		0.8	%	0		0.0	%
Operating Income	8,628		2.0	%	2,063		0.5	%
Other Income, net	273		0.0	%	1,691		0.4	%
Income from Continuing Operations Before Taxes on Income	8,901		2.0	%	3,754		0.9	%
Provision for Income Taxes	2,503		0.6	%	694		0.1	%
Income from Continuing Operations	6,398		1.4	%	3,060		0.8	%
Income from Discontinued Operations, Net of Tax	9,157		2.1	%	22,553		5.5	%
Net Income	$	15,555	3.5	%	$	25,613	6.3	%
Earnings Per Share of Common Stock:
Basic from Continuing Operations	$	0.17			$	0.08
Diluted from Continuing Operations	$	0.17			$	0.08
Basic	$	0.40			$	0.67
Diluted	$	0.40			$	0.66
Average Number of Total Shares Outstanding
Basic	38,773				38,394
Diluted	39,102				38,838

Condensed Consolidated Statements of Cash Flows	Nine Months Ended
(Unaudited)	March 31,
(Amounts in Thousands)	2015			2014
Net Cash Flow provided by Operating Activities	$	12,021		$	64,850
Net Cash Flow used for Investing Activities	(23,147		)	(22,812		)
Net Cash Flow used for Financing Activities	(74,270		)	(7,556		)
Effect of Exchange Rate Change on Cash and Cash Equivalents	(1,260		)	264
Net (Decrease) Increase in Cash and Cash Equivalents	(86,656		)	34,746
Cash and Cash Equivalents at Beginning of Period	136,624			103,600
Cash and Cash Equivalents at End of Period	$	49,968		$	138,346

The above figures include Kimball Electronics cash flows through the October 31, 2014 spin-off date, as cash management was centralized prior to the spin-off.

	(Unaudited)
Condensed Consolidated Balance Sheets	March 31, 2015		June 30, 2014
(Amounts in Thousands)
ASSETS
Cash and cash equivalents	$	49,968	$	136,624
Receivables, net	44,692		175,695
Inventories	34,675		140,475
Prepaid expenses and other current assets	33,384		46,998
Property and Equipment, net	91,249		188,833
Goodwill	0		2,564
Other Intangible Assets, net	2,647		4,191
Other Assets	15,387		26,766
Total Assets	$	272,002	$	722,146
LIABILITIES AND SHARE OWNERS' EQUITY
Current maturities of long-term debt	$	27	$	25
Accounts payable	55,650		174,436
Dividends payable	1,947		1,883
Accrued expenses	49,740		77,256
Long-term debt, less current maturities	244		268
Other	18,191		26,745
Share Owners' Equity	146,203		441,533
Total Liabilities and Share Owners' Equity	$	272,002	$	722,146

The June 30, 2014 balance sheet includes Kimball Electronics. The March 31, 2015 balance sheet represents continuing operations only.

Supplementary Information
Components of Other Income, net	Three Months Ended						Nine Months Ended
(Unaudited)	March 31,						March 31,
(Amounts in Thousands)	2015			2014			2015			2014
Interest Income	$	61		$	36		$	151		$	144
Interest Expense	(6		)	(6		)	(18		)	(19		)
Foreign Currency/Derivative Gain (Loss)	2			(40		)	(40		)	(56		)
Gain on Supplemental Employee Retirement Plan Investment	353			187			519			2,041
Other Non-Operating Expense	(65		)	(138		)	(339		)	(419		)
Other Income, net	$	345		$	39		$	273		$	1,691

Net Sales by End Market Vertical
	Three Months Ended						Nine Months Ended
	March 31,						March 31,
(Amounts in Millions)	2015		2014		% Change		2015		2014		% Change
Education	$	7.9	$	6.4	23	%	$	28.5	$	30.0	(5	%)
Finance	13.1		16.4		(20	%)	42.0		48.2		(13	%)
Government	18.6		17.3		8	%	73.1		65.1		12	%
Healthcare	14.5		13.1		11	%	43.9		44.9		(2	%)
Hospitality	42.0		30.9		36	%	102.7		88.3		16	%
Other Commercial	49.8		41.0		21	%	151.6		129.5		17	%
Total Net Sales	$	145.9	$	125.1	17	%	$	441.8	$	406.0	9	%

Orders Received by End Market Vertical
	Three Months Ended						Nine Months Ended
	March 31,						March 31,
(Amounts in Millions)	2015		2014		% Change		2015		2014		% Change
Education	$	8.2	$	4.9	67	%	$	26.5	$	23.1	15	%
Finance	13.2		16.6		(20	%)	42.2		48.7		(13	%)
Government	18.8		18.8		0	%	71.1		66.6		7	%
Healthcare	15.3		12.9		19	%	45.9		42.7		7	%
Hospitality	23.1		21.6		7	%	105.5		89.6		18	%
Other Commercial	52.3		39.0		34	%	160.7		133.2		21	%
Total Orders Received	$	130.9	$	113.8	15	%	$	451.9	$	403.9	12	%

Reconciliation of Non-GAAP Financial Measures
(Unaudited)
(Amounts in Thousands, except per share data)
Operating Income (Loss) excluding Spin-off Expenses and Restructuring Charges
	Three Months Ended
	March 31,
	2015		2014
Operating Income (Loss), as reported	$	5,111	$	(1,075	)
Add: Pre-tax Spin-off Expenses	226		414
Add: Pre-tax Restructuring Charges	388		0
Adjusted Operating Income (Loss)	$	5,725	$	(661	)
Income (Loss) from Continuing Operations excluding Spin-off Expenses and Restructuring Charges
	Three Months Ended
	March 31,
	2015		2014
Income (Loss) from Continuing Operations, as reported	$	4,882	$	(37	)
Add: After-tax Spin-off Expenses	155		413
Add: After-tax Restructuring Charges	236		0
Adjusted Income from Continuing Operations	$	5,273	$	376
Diluted Earnings Per Share from Continuing Operations excluding Spin-off Expenses and Restructuring Charges
	Three Months Ended
	March 31,
	2015		2014
Diluted Earnings Per Share from Continuing Operations, as reported	$	0.13	$	0.00
Add: Impact of Spin-off Expenses	0.00		0.01
Add: Impact of Restructuring Charges	0.01		0.00
Adjusted Diluted Earnings Per Share from Continuing Operations	$	0.14	$	0.01

EX-99.2

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Third Quarter Fiscal Year 2015 Investor Presentation Exhibit 99.2

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 2 Safe Harbor Statement Certain statements contained within this presentation may be considered forward-looking under the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties including, but not limited to, the risk that any projections or guidance, including revenues, margins, earnings, or any other financial results are not realized, the ability to fully realize the expected benefits of the spin-off of our EMS segment, the successful completion of the restructuring plan, adverse changes in the global economic conditions, increased global competition, significant reduction in customer order patterns, relationships with strategic customers and product distributors, availability or cost of raw materials and components, increased competitive pricing pressures reflecting excess industry capacities, changes in the regulatory environment, or similar unforeseen events. Additional cautionary statements regarding other risk factors that could have an effect on the future performance of Kimball are contained in our Annual Report on Form 10-K filing for the fiscal year ended June 30, 2014.

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 3 Now a Focused Furniture Company (Spins Off Electronics) 60+ Year History of Quality and Craftsmanship  Founded in 1950 as a small contract furniture manufacturing company.  Through acquisitions and strategic initiatives, Kimball International grew into the streamlined furniture provider that it is today.  Today, Kimball Office, National Office Furniture and Kimball Hospitality are all recognized brands in their respective furniture categories Celebrated 60 year anniversary Made first acquisition, a kitchen cabinet manufacturer, which kicked off a decade long pursuit of vertical integration Jasper Corporation was formed and began manufacturing wood products, including TV cabinets Acquired W.W. Kimball, a 102-year old manufacturer of pianos and organs Decided to manufacture and design office furniture as Kimball Office Company name changed from Jasper Corporation to Kimball International Kimball International became a publicly-held company by offering for sale 500,000 shares of Class B Common Stock. Class A was privately held. Restructured and focused Furniture solely on Office and Hospitality furniture National Office Furniture formed to serve the growing middle-market 1950 1952 1959 1974 1970 1985 1980 2007 2010 1976 Entered the lodging market forming Kimball Hospitality Kimball International returns to a furniture focused company with the spin-off of Kimball Electronics 2014 and Beyond Kimball International has evolved, changed and grown into major furniture player over the last 64 years Then Now To Stock Unification NasdaqGS:KBAL 1961 Established Kimball Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 4 Award Winning and Recognized Furniture Brands Favorable Industry Dynamics Strong Balance Sheet with $50M in Cash/Nil Debt Restructuring Plan Being Implemented - Significant Operating Income Margin Opportunity Significant Increase In New Product Introductions - Poised for Growth Summary - Key Investment Highlights Dividend Yield of 2%

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 5  Established Brand Presidents – Put Authority Closer to Markets  Announced Restructuring Plan to Reduce Excess Capacity: – Post Falls Idaho Manufacturing Facility Exit - $5M Annual Savings Beginning FY Q2’17 – Sale Of Air Plane Focused on Executive Travel - $800K Annual Savings Being Realized  Began Utilizing Office Furniture Mfg. Capacity For Hospitality Orders  Adjusted Compensation – Established Relative Total Shareowner Return Plan for CEO, COO, and CFO – Adjusted Incentive Comp Plan to Increase Difficulty  Began Cultural Change to Promote Collaboration, Teamwork, and Speed  Heightened Focus on Achieving 8% Operating Income A New Day Key Operating Changes Since 10/31/14 Spin-off Of Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 6  Established Lead Independent Director of the Board A New Day Key Operating Changes Since 10/31/14 Spin-off Of Electronics  Unified Two-Class Stock Structure-All Shares Now With Equal Voting  Established Resignation Policy for Board Members Not Receiving Majority Vote in an Uncontested Election  Implemented Restrictions on Hedging/Pledging Company Shares  Working On “Modernizing” Change-In-Control Agreements  Retirements of Former CEO and Chairman at Spin

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 7 Brands Representative Customers Design driven, tech savvy brand tailoring solutions that provide better workplace, learning and healing environments. Our broad product portfolio offers unlimited possibilities that are inspiring, productive, and environmentally responsible In-room and public space furniture solutions for hotel properties, condominiums, and mixed use developments. Largest hotel in-room casegoods and seating manufacturer in the US. Furniture solutions to address a variety of industries and price points, including private offices, open/collaborative, conference/training rooms, lobby and dining/lounge areas Who We Are and Who We Serve

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 8 Sampling of Kimball Office New Product Boyd Dock Dwell Flip Xsede Alumma Teem Stow

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 9 Sampling of Kimball Office New Product

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 10 Sampling of National New Products Reno Enhancements Essay Exhibit Enhancements Staccato Swift Enhancements Mio Collaborative Tables Palisander Corian Tops Fringe Lounge Acorn Sable

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 11 Comprehensive Product Offering Casegoods Seating Cutomer Service Fu rni tur e Su bty pe s / Se rvi ce s  Custom  Program  Collections  Fabric  Finishes  Upholstered headboards  Custom  Individual  Multi-person  Product Development  Project Management  Order Fulfillment  Supply Chain  Quality  Logistics  Service

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 12 2014 Dealers’ Choice Survey Winner: National – Tables and Second Place - Casegoods Sample Awards and Recognitions Contract Magazine Top 10 Brand in Desks/Credenzas

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Furniture Industry Indicators

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 14 U.S. Furniture Leading Indicators are Improving S ou rc e U S B ur ea u of E co no m ic A na ly si s S ou rc e: U S B ur ea u of L ab or S ta tis tic s S ou rc e: A IA Architectural Billing Index 8.6% 10.0% -35.0% -30.0% -25.0% -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 0 2000 4000 6000 8000 10000 12000 14000 16000 BIFMA ($millions) Consumption Growth Bullish Outlook 100 105 110 115 120 125 3/ 1/ 20 03 9/ 1/ 20 03 3/ 1/ 20 04 9/ 1/ 20 04 3/ 1/ 20 05 9/ 1/ 20 05 3/ 1/ 20 06 9/ 1/ 20 06 3/ 1/ 20 07 9/ 1/ 20 07 3/ 1/ 20 08 9/ 1/ 20 08 3/ 1/ 20 09 9/ 1/ 20 09 3/ 1/ 20 10 9/ 1/ 20 10 3/ 1/ 20 11 9/ 1/ 20 11 3/ 1/ 20 12 9/ 1/ 20 12 3/ 1/ 20 13 9/ 1/ 20 13 3/ 1/ 20 14 9/ 1/ 20 14 3/ 1/ 20 15 Service Sector Employement (millions workers) 0 200 400 600 800 1000 1200 1400 1600 1800 US Corporate Profit After Tax With IVA and CCA adjustment ($billion) March up to 51.7 from 50.4 in Feb.

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 15 Hospitality Leading Indicators are Strong 8.3% 7.4% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% Luxury Upper Scale Upscale Upper Middle Scale Midscale Economy Independents US 2014 2015 Source: PWC Hospitality Directions January 2015 Revenue Per Available Room (RevPAR) Growth Rates (Estimated) RevPAR up since prior quarter

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Kimball International Financial Overview Basis of financial information is Continuing Operations adjusted for certain non-operating and non-recurring transactions for comparability. Financial information included throughout is unaudited.

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 17 Sales Growth Each Quarter Net Sales (1) ($ in millions) $125.1 $137.9 $144.4 $151.4 $145.9 4.8% 9.8% 1.8% 8.9% 16.6% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% $0 $25 $50 $75 $100 $125 $150 $175 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Net Sales Year Over Year Growth Excludes Electronics (1) Unaudited

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 18 Order Levels Orders (1) ($ in millions) $113.8 $150.3 $161.9 $159.0 $130.9 -3.7% 4.2% 1.8% 21.4% 15.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% $0 $25 $50 $75 $100 $125 $150 $175 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Orders Received Year Over Year Growth _____________________ (1) Unaudited. Excludes Electronics Or 10.8% excluding unusually large ($13.8M) hospitality vertical order in Q2’15

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 19 Gross Profit Gross Profit from Continuing Operations (1) ($ in millions) $36.6 $42.1 $47.2 $46.6 $44.0 29.3% 30.5% 32.7% 30.8% 30.2% 27.0% 28.0% 29.0% 30.0% 31.0% 32.0% 33.0% $30 $40 $50 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Gross Profit % of Net Sales _____________________ (1) Unaudited. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 20 $37.3 $41.1 $42.4 $41.7 $38.3 $35.5 $40.5 $40.2 $40.4 $37.9 28.4% 29.4% 27.8% 26.7% 26.0% 24.0% 25.0% 26.0% 27.0% 28.0% 29.0% 30.0% $30 $35 $40 $45 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Adjusted S&A (1) Adjusted Pro Forma S&A (1) Adjusted Pro Forma S&A % of Sales (1) Selling and Administrative Expenses (1) ($ in millions) _____________________ (1) Unaudited. Adjusted amounts exclude spin-off expenses. Adjusted pro forma amounts exclude spin-off expenses, compensation of key executives who retired as of the spin-off date, and SERP revaluation. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 21 Changes in Selling and Administrative Expense Adjusted Pro Forma S&A (1) ($ in millions) $35.5 $37.9 $0.7 $0.5 $0.4 $0.8 $35 $36 $37 $38 $39 _____________________ (1) Unaudited. Adjusted pro forma amounts exclude spin-off expenses, compensation of key executives who retired as of the spin-off date, and SERP revaluation. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 22 $(0.7) $1.0 $4.8 $4.9 $5.7 $0.8 $1.3 $6.7 $6.1 $6.1 0.6% 0.9% 4.6% 4.0% 4.2% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% -$2 -$1 $0 $1 $2 $3 $4 $5 $6 $7 $8 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Adjusted Operating Profit (1) Adjusted Pro Forma Operating Profit (1) Adjusted Pro Forma Operating Profit as a % of Sales (1) Operating Profit (1) ($ in millions) _____________________ (1) Unaudited. See appendix for Non-GAAP reconciliation. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 23 Free Cash Flow – Last 4 Quarters (1) _____________________ (1) Unaudited. Defined as adjusted pro forma operating profit, less pro-forma taxes, plus depreciation and amortization, less capital expenditures, plus non-cash stock compensation. Pro forma taxes are reported taxes adjusted for the tax effect of the adjustments to operating profit to arrive at pro forma operating profit as shown in the appendix. See Appendix for Non-GAAP adjustments. $1.7 $5.3 $2.3 $3.6 Q4'14 Q1'15 Q2'15 Q3'15 -$8.0 -$6.0 -$4.0 -$2.0 $0.0 $2.0 $4.0 $6.0 Adjusted Pro-Forma Operating Profit After Tax Depreciation/Amortization Capital Expenditures Non-Cash Stock Comp Adjusted Free Cash Flow Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 24 Sales by Vertical – Good Diversification Sales Mix by End Market Vertical (1) _____________________ (1) Unaudited. Excludes Electronics $41.0 $49.8 $17.3 $18.6 $30.9 $42.0 $16.4 $13.1 $13.1 $14.5 $6.4 $7.9 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 Q3'14 Q3'15 Other Commercial Government Hospitality Finance Healthcare Education

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 25 Sales by Vertical – Change Since Prior Year (1) ($ in millions) _____________________ (1) Unaudited. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 26 Orders by Vertical Order Mix by End Market Vertical (1) _____________________ (1) Unaudited. Excludes Electronics $39.0 $52.3 $18.8 $18.8 $21.6 $23.1 $16.6 $13.2 $12.9 $15.3 $4.9 $8.2 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 Q3'14 Q3'15 Other Commercial Government Hospitality Finance Healthcare Education

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 27 Orders by Vertical – Change Since Prior Year (1) ($ in millions) $113.8 $130.9 $13.3 $0.0 $1.5 ($3.4) $2.4 $3.3 $105 $110 $115 $120 $125 $130 $135 _____________________ (1) Unaudited. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Financial Outlook

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 29 Planning Assumptions to FY Q2’17  US GDP Growth of ~3%  Office Furniture growth approximates BIFMA CY ‘15 forecast of 8.6%  Hospitality Furniture growth flat thru FY’16 and 5% growth thereafter Flat in FY’16 due to significant projects in FY’15  No Acquisitions Planned in this Time Frame  Commodity Pricing Stable  Post Falls Restructuring completed by FY Q1’17 (September 2016) in accordance to plan

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 30 Progress Being Made Towards Published 8% Operating Profit Goal _____________________ (1) Unaudited. See Appendix for Non-GAAP reconciliation. Excludes Electronics -0.80% 1.30% -1.00% 2.00% 4.60% 4.00% 4.20% -2.00% -1.00% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 2011 2012 2013 2014 Q1'15 Q2'15 Q3'15 8% GOAL

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 31 Targeting 7 to 8% Operating Profit after Completion of Restructuring Q2’17 Outlook (Quarter Ending December 2016) Sales $170 to $180 million Operating Income 7.0 to 8.0% Operating Income $’s $12 to $14 million Tax Rate 35 to 38% Earnings Per Diluted Share $0.20 to $0.24 Return on Capital* Approaching 20% * Defined as Annualized Operating Income After Tax Divided by Capital. Capital is defined as Total Assets Minus Current Liabilities.

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Appendix

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 33 Annual Non-GAAP Reconciliation (Unaudited) (millions $) 2011 2012 2013 2014 Kimball International Inc. Operating Profit – As Reported (Includes both Furniture and Electronics) $2.4 $18.4 $23.0 $40.6 Discontinued Electronics Operations Income -$10.3 -$13.4 -$33.6 -$38.7 Add: Spin Cost – Included in SGA (1) $1.5 Adjusted Operating Profit from Continuing Operations (5) -$7.9 $5.0 -$10.6 $3.4 Adjusted Operating Profit from Continuing Operations as a % of Sales -1.6% 1.0% -2.1% .6% Add: Employee Retirements – Included in SGA (2) Add: Other Non-operational – Included in SGA (3) Add: SERP –Included in SGA (4) $2.8 $2.5 $3.2 $0 $5.0 $1.7 $6.8 -$.5 $2.6 Adjusted Pro Forma Operating Profit from Continuing Operations before External Reverse Synergies -$2.6 $8.2 -$3.9 $12.3 Deduct: External Reverse Synergies (5) -$1.3 -$1.3 -$1.3 -$1.3 Adjusted Pro Forma Operating Profit from Continuing Operations (5) -$3.9 $6.9 -$5.2 $11.0 Adjusted Pro Forma Operating Profit from Continuing Operations as a % of Sales -.8% 1.3% -1.0% 2.0% _____________________ (1) Total spin cost is estimated to be ~ $7.2M. Spin cost through FY 2014 equaled $3M of which $1.5M reduces reported operating profit from continuing operations and $1.5M is included in discontinued operations. (2) Estimated cost associated with the retirement and separation of people due to spin. Cost include that for salary, incentive compensation, performance shares, retirement contribution, and payroll tax. (3) Includes: pre-tax airplane write-off $1.2M and gain from sale of idle property of $1.7M in FY’14. (4) SERP expense is added back to adjusted operating profit because amount is offset in other income (expense) section of income statement. Net Income is not affected by SERP. (5) Adjusted pro forma operating profit includes external reverse synergies representing estimated increases to the cost structure necessitated by the split into two companies. For example, pre-spin Kimball had one board of directors, and such costs were allocated to Furniture and Electronics. Post spin, there are two boards with each company experiencing a cost increase merely because of the separation. Other examples include IT expenditures and certain insurance cost among others. The $1.3M per year reflected in the table above is a mid-point of a range estimated to be from $1.0M to $1.5M adjusting the adjusted pro forma operating profit from continuing operations to reflect this estimated increase in cost structure post spin. In addition to external cost, internal reverse synergy cost also exist and are embedded in the calculation of Operating Income from continuing operations reducing income. Different than external cost, these costs do not have to be separately deducted in this reconciliation because by way of the discontinued operation calculation this cost increase remains within the computed Operating Income from continuing operations. As an example for this type of cost, pre-spin Kimball had an SEC financial reporting function, and such costs were allocated to Furniture and Electronics. Post spin, there are two separate functions experiencing a cost increase as it takes more resource to perform this function for two separate companies than one. This cost increase is estimated to be $500k to $1M. So in total, it is estimated that reverse synergy cost will increase cost structure post spin by $1.5 to $2.5M per year as already reflected in the adjusted results included in the reconciliation above. Excludes Electronics

176 0 0 137 132 126 237 23 23 46 46 46 51 132 156 252 202 59 Page 34 Quarterly Non-GAAP Reconciliation (Unaudited) (millions $) Q3’14 Q4’14 Q1’15 Q2’15 Q3’15 Kimball International Inc. Operating Profit – As Reported (Includes both Furniture and Electronics for Q3’14 – Q1’15) $8.4 $10.3 $13.7 NA-Electronics classified as a discontinued operation. NA-Electronics classified as a discontinued operation. Discontinued Electronics Operations Income -$9.5 -$10.4 -$10.0 Operating Income from Continuing Operations -$1.1 -$0.1 $3.7 -$0.1 $5.1 Add: Spin Cost – Included in SGA (1) Restructuring $.4 $1.1 $1.1 $1.7 $3.3 $.2 $.4 Adjusted Operating Profit from Continuing Operations (5) -$.7 $1.0 $4.8 $4.9 $5.7 Adjusted Operating Profit from Continuing Operations as a % of Sales -.5% .7% 3.3% 3.2% 3.9% Add: Employee Retirements – Included in SGA (2) Add: Other Non-operational – Included in SGA (3) Add: SERP –Included in SGA (4) $1.6 $.2 $1.8 -$1.7 $.5 $2.4 -$.2 $.9 $.4 $.4 Adjusted Pro Forma Operating Profit from Continuing Operations before External Reverse Synergies $1.1 $1.6 $7.0 $6.2 $6.1 Deduct: External Reverse Synergies (5) -$.3 -$.3 -$.3 -$.1 Adjusted Pro Forma Operating Profit from Continuing Operations (5) $.8 $1.3 $6.7 $6.1 $6.1 Adjusted Pro Forma Operating Profit from Continuing Operations as a % of Sales .6% .9% 4.6% 4.0% 4.2% _____________________ (1) Total spin cost is estimated to be ~ $7.2M. Spin cost through Q3’15 equaled $7.1M of which $4.6M reduces reported operating profit from continuing operations and $2.5M is included in discontinued operations. (2) Estimated cost associated with the retirement and separation of people due to spin. Cost include that for salary, incentive compensation, performance shares, retirement contribution, and payroll tax. (3) Includes: pre-tax airplane write-off $1.2M and gain from sale of idle property of $1.7M in FY’14. (4) SERP expense is added back to adjusted operating profit because amount is offset in other income (expense) section of income statement. Net Income is not affected by SERP. (5) Adjusted pro forma operating profit includes external reverse synergies representing estimated increases to the cost structure necessitated by the split into two companies. For example, pre-spin Kimball had one board of directors, and such costs were allocated to Furniture and Electronics. Post spin, there are two boards with each company experiencing a cost increase merely because of the separation. Other examples include IT expenditures and certain insurance cost among others. The $.3M per quarter reflected in the table above is a mid-point of a range estimated to be from $1.0M to $1.5M per year adjusting the adjusted pro forma operating profit from continuing operations to reflect this estimated increase in cost structure post spin. In addition to external cost, internal reverse synergy cost also exist and are embedded in the calculation of Operating Income from continuing operations reducing income. Different than external cost, these costs do not have to be separately deducted in this reconciliation because by way of the discontinued operation calculation this cost increase remains within the computed Operating Income from continuing operations. As an example for this type of cost, pre-spin Kimball had an SEC financial reporting function, and such costs were allocated to Furniture and Electronics. Post spin, there are two separate functions experiencing a cost increase as it takes more resource to perform this function for two separate companies than one. This cost increase is estimated to be $500k to $1M per year. So in total, it is estimated that reverse synergy cost will increase cost structure post spin by $1.5 to $2.5M per year as already reflected in the adjusted results included in the reconciliation above. Excludes Electronics