Michigan (State or Other Jurisdiction of incorporation) | 001-15141 (Commission File No.) | 38-0837640 (IRS Employer Identification no.) | |||
855 East Main Avenue Zeeland, Michigan (Address of Principal Executive Offices) | 49464 (Zip Code) |
Dated: | March 16, 2016 | HERMAN MILLER, INC. | ||
(Registrant) | ||||
By: | /s/ Kevin J. Veltman Kevin J. Veltman | |||
Vice President of Investor Relations & Treasurer (Duly Authorized Signatory for Registrant) |
• | Organic net sales increase of 5.5% |
• | 24% growth in adjusted diluted earnings per share |
• | Strong operating cash flow generation |
Release | Immediate |
Date | March 16, 2016 |
Contact | Kevin Veltman (616) 654-3973 or kevin_veltman@hermanmiller.com |
Jeff Stutz (616) 654-8538 or jeff_stutz@hermanmiller.com | |
Media: (616) 654-5977 or media_relations@hermanmiller.com | |
Address | Herman Miller, Inc., 855 East Main Avenue, PO Box 302, Zeeland, MI 49464-0302 |
Internet | www.hermanmiller.com |
FINANCIAL HIGHLIGHTS (Dollars in millions, except per share data) | ||||||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
2/27/2016 | 2/28/2015 | % Chg. | 2/27/2016 | 2/28/2015 | % Chg. | |||||||||||
Net Sales | $ | 536.5 | $ | 516.4 | 3.9 | % | $ | 1,682.3 | $ | 1,591.5 | 5.7 | % | ||||
Gross Margin % | 38.7 | % | 36.9 | % | N/A | 38.6 | % | 36.6 | % | N/A | ||||||
Operating Expenses | $ | 163.5 | $ | 151.2 | 8.1 | % | $ | 494.1 | $ | 453.6 | 8.9 | % | ||||
Restructuring and Impairment Expenses | $ | — | $ | 1.9 | N/A | $ | — | $ | 1.9 | N/A | ||||||
Operating Earnings % | 8.3 | % | 7.2 | % | N/A | 9.2 | % | 7.9 | % | N/A | ||||||
Adjusted Operating Earnings % * | 8.3 | % | 7.6 | % | N/A | 9.2 | % | 8.7 | % | N/A | ||||||
Adjusted EBITDA* | $ | 56.0 | $ | 51.7 | 8.3 | % | $ | 194.1 | $ | 175.7 | 10.5 | % | ||||
Net Earnings Attributable to Herman Miller, Inc. | $ | 27.9 | $ | 21.0 | 32.9 | % | $ | 96.1 | $ | 74.1 | 29.7 | % | ||||
Earnings Per Share – Diluted | $ | 0.46 | $ | 0.35 | 31.4 | % | $ | 1.59 | $ | 1.23 | 29.3 | % | ||||
Adj. Earnings Per Share – Diluted * | $ | 0.46 | $ | 0.37 | 24.3 | % | $ | 1.59 | $ | 1.35 | 17.8 | % | ||||
Orders | $ | 508.8 | $ | 500.5 | 1.7 | % | $ | 1,673.5 | $ | 1,589.6 | 5.3 | % | ||||
Backlog | $ | 313.3 | $ | 316.6 | (1.0 | )% |
Three Months Ended | ||||||||||
February 27, 2016 | February 28, 2015 | |||||||||
Net Sales | $ | 536.5 | 100.0 | % | $ | 516.4 | 100.0 | % | ||
Cost of Sales | 328.7 | 61.3 | % | 325.9 | 63.1 | % | ||||
Gross Margin | 207.8 | 38.7 | % | 190.5 | 36.9 | % | ||||
Operating Expenses | 163.5 | 30.5 | % | 151.2 | 29.3 | % | ||||
Restructuring and Impairment Expenses | — | — | % | 1.9 | 0.4 | % | ||||
Operating Earnings | 44.3 | 8.3 | % | 37.4 | 7.2 | % | ||||
Other Expenses, net | 4.4 | 0.8 | % | 5.4 | 1.0 | % | ||||
Earnings Before Income Taxes and Equity Income | 39.9 | 7.4 | % | 32.0 | 6.2 | % | ||||
Income Tax Expense | 11.9 | 2.2 | % | 10.8 | 2.1 | % | ||||
Equity Income, net of tax | 0.2 | — | % | — | — | % | ||||
Net Earnings | 28.2 | 5.3 | % | 21.2 | 4.1 | % | ||||
Net Earnings Attributable to Noncontrolling Interests | 0.3 | 0.1 | % | 0.2 | — | % | ||||
Net Earnings Attributable to Herman Miller, Inc. | $ | 27.9 | 5.2 | % | $ | 21.0 | 4.1 | % | ||
Amounts per Common Share Attributable to Herman Miller, Inc. | ||||||||||
Earnings Per Share – Basic | $0.46 | $0.35 | ||||||||
Weighted Average Basic Common Shares | 59,885,597 | 59,550,289 | ||||||||
Earnings Per Share – Diluted | $0.46 | $0.35 | ||||||||
Weighted Average Diluted Common Shares | 60,450,848 | 60,098,189 |
Nine Months Ended | ||||||||||
February 27, 2016 | February 28, 2015 | |||||||||
Net Sales | $ | 1,682.3 | 100.0 | % | $ | 1,591.5 | 100.0 | % | ||
Cost of Sales | 1,033.3 | 61.4 | % | 1,009.7 | 63.4 | % | ||||
Gross Margin | 649.0 | 38.6 | % | 581.8 | 36.6 | % | ||||
Operating Expenses | 494.1 | 29.4 | % | 453.6 | 28.5 | % | ||||
Restructuring and Impairment Expenses | — | — | % | 1.9 | 0.1 | % | ||||
Operating Earnings | 154.9 | 9.2 | % | 126.3 | 7.9 | % | ||||
Other Expenses, net | 12.3 | 0.7 | % | 14.8 | 0.9 | % | ||||
Earnings Before Income Taxes and Equity Income | 142.6 | 8.5 | % | 111.5 | 7.0 | % | ||||
Income Tax Expense | 46.1 | 2.7 | % | 37.3 | 2.3 | % | ||||
Equity Income, net of tax | 0.4 | — | % | 0.1 | — | % | ||||
Net Earnings | 96.9 | 5.8 | % | 74.3 | 4.7 | % | ||||
Net Earnings Attributable to Noncontrolling Interests | 0.8 | — | % | 0.2 | — | % | ||||
Net Earnings Attributable to Herman Miller, Inc. | $ | 96.1 | 5.7 | % | $ | 74.1 | 4.7 | % | ||
Amounts per Common Share Attributable to Herman Miller, Inc. | ||||||||||
Earnings Per Share – Basic | $1.61 | $1.25 | ||||||||
Weighted Average Basic Common Shares | 59,837,132 | 59,430,575 | ||||||||
Earnings Per Share – Diluted | $1.59 | $1.23 | ||||||||
Weighted Average Diluted Common Shares | 60,406,676 | 59,996,867 |
Nine Months Ended | ||||||
February 27, 2016 | February 28, 2015 | |||||
Net Earnings | $ | 96.9 | $ | 74.3 | ||
Cash Flows provided by Operating Activities | 125.9 | 109.8 | ||||
Cash Flows used for Investing Activities | (58.0 | ) | (200.5 | ) | ||
Cash Flows provided by (used for) Financing Activities | (76.6 | ) | 50.7 | |||
Effect of Exchange Rates | 0.3 | 0.3 | ||||
Change in Cash | (8.4 | ) | (39.7 | ) | ||
Cash, Beginning of Period | 63.7 | 101.5 | ||||
Cash, End of Period | $ | 55.3 | $ | 61.8 |
February 27, 2016 | May 30, 2015 | |||||
ASSETS | ||||||
Current Assets: | ||||||
Cash and Cash Equivalents | $ | 55.3 | $ | 63.7 | ||
Marketable Securities | 7.3 | 5.7 | ||||
Accounts and Notes Receivable, net | 183.9 | 189.6 | ||||
Inventories, net | 135.3 | 129.6 | ||||
Prepaid Expenses and Other | 53.6 | 74.9 | ||||
Total Current Assets | 435.4 | 463.5 | ||||
Net Property and Equipment | 265.4 | 249.5 | ||||
Other Assets | 487.8 | 479.7 | ||||
Total Assets | $ | 1,188.6 | $ | 1,192.7 | ||
LIABILITIES & STOCKHOLDERS' EQUITY | ||||||
Current Liabilities: | ||||||
Accounts Payable | 143.5 | 164.7 | ||||
Accrued Liabilities | 216.6 | 198.7 | ||||
Total Current Liabilities | 360.1 | 363.4 | ||||
Long-term Debt | 240.2 | 289.8 | ||||
Other Liabilities | 67.9 | 88.8 | ||||
Total Liabilities | 668.2 | 742.0 | ||||
Redeemable Noncontrolling Interests | 27.6 | 30.4 | ||||
Herman Miller, Inc. Stockholders' Equity | 492.0 | 419.8 | ||||
Noncontrolling Interests | 0.8 | 0.5 | ||||
Total Stockholders' Equity | 492.8 | 420.3 | ||||
Total Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | $ | 1,188.6 | $ | 1,192.7 |
Herman Miller, Inc. (together with its consolidated subsidiaries, the "company", "we", "our" or "us") provides this supplement to assist investors in evaluating the company's financial and operating results and metrics. We suggest that the narratives to each of the tables included in this supplement be read in conjunction with the financial tables. The financial information included in this supplement contains certain non-GAAP financial measures, as explained in more detail in Section II below. |
Three Months Ended | Nine Months Ended | ||||||||||||
Net Sales | 2/27/2016 | 2/28/2015 | 2/27/2016 | 2/28/2015 | |||||||||
North America | $ | 312.7 | $ | 296.0 | $ | 998.9 | $ | 932.4 | |||||
ELA | 98.9 | 97.3 | 302.1 | 307.0 | |||||||||
Specialty | 54.7 | 50.5 | 170.2 | 160.5 | |||||||||
Consumer | 70.2 | 72.6 | 211.1 | 191.6 | |||||||||
Corporate | — | — | — | — | |||||||||
Total | $ | 536.5 | $ | 516.4 | $ | 1,682.3 | $ | 1,591.5 | |||||
% Change in Net Sales | |||||||||||||
North America | 5.6 | % | 7.1 | % | |||||||||
ELA | 1.6 | % | (1.6 | )% | |||||||||
Specialty | 8.3 | % | 6.0 | % | |||||||||
Consumer | (3.3 | )% | 10.2 | % | |||||||||
Corporate | n/a | n/a | |||||||||||
Total | 3.9 | % | 5.7 | % | |||||||||
Operating Earnings (Loss) | |||||||||||||
North America | $ | 30.6 | $ | 26.7 | $ | 112.8 | $ | 95.2 | |||||
ELA | 6.8 | 6.2 | 20.7 | 19.7 | |||||||||
Specialty | 3.4 | 1.9 | 11.9 | 7.6 | |||||||||
Consumer | 2.8 | 4.6 | 9.3 | 8.4 | |||||||||
Corporate | 0.7 | (2.0 | ) | 0.2 | (4.6 | ) | |||||||
Total | $ | 44.3 | $ | 37.4 | $ | 154.9 | $ | 126.3 | |||||
Operating Earnings % Net Sales | |||||||||||||
North America | 9.8 | % | 9.0 | % | 11.3 | % | 10.2 | % | |||||
ELA | 6.9 | % | 6.4 | % | 6.9 | % | 6.4 | % | |||||
Specialty | 6.2 | % | 3.8 | % | 7.0 | % | 4.7 | % | |||||
Consumer | 4.0 | % | 6.3 | % | 4.4 | % | 4.4 | % | |||||
Corporate | n/a | n/a | n/a | n/a | |||||||||
Total | 8.3 | % | 7.2 | % | 9.2 | % | 7.9 | % |
A. Reconciliation of Earnings per Share to Adjusted Earnings per Share | Three Months Ended | Nine Months Ended | |||||||||||
2/27/2016 | 2/28/2015 | 2/27/2016 | 2/28/2015 | ||||||||||
Earnings per Share - Diluted | $ | 0.46 | $ | 0.35 | $ | 1.59 | $ | 1.23 | |||||
Add: Restructuring Expenses | — | 0.02 | — | 0.02 | |||||||||
Add: Acquisition-Related Inventory Adjustments | — | — | — | 0.08 | |||||||||
Add: Acquisition Expenses | — | — | — | 0.02 | |||||||||
Adjusted Earnings per Share – Diluted | $ | 0.46 | $ | 0.37 | $ | 1.59 | $ | 1.35 | |||||
Weighted Average Shares Outstanding (used for Calculating Adjusted Earnings per Share) – Diluted | 60,450,848 | 60,098,189 | 60,406,676 | 59,996,867 | |||||||||
B. Reconciliation of Operating Earnings to Adjusted Operating Earnings and Adjusted EBITDA | Three Months Ended | Nine Months Ended | |||||||||||
2/27/2016 | 2/28/2015 | 2/27/2016 | 2/28/2015 | ||||||||||
Operating Earnings | $ | 44.3 | $ | 37.4 | $ | 154.9 | $ | 126.3 | |||||
Add: Restructuring Expenses | — | 1.9 | — | 1.9 | |||||||||
Add: Acquisition-Related Inventory Adjustments | — | — | — | 7.8 | |||||||||
Add: Acquisition Expenses | — | — | — | 2.2 | |||||||||
Adjusted Operating Earnings | $ | 44.3 | $ | 39.3 | $ | 154.9 | $ | 138.2 | |||||
Other Income (Expense), net | (0.6 | ) | (1.0 | ) | (0.7 | ) | (1.1 | ) | |||||
Add: Depreciation and Amortization | 12.3 | 13.4 | 39.9 | 38.6 | |||||||||
Adjusted EBITDA | $ | 56.0 | $ | 51.7 | $ | 194.1 | $ | 175.7 | |||||
C. Reconciliation of Operating Earnings to Adjusted Operating Earnings and Adjusted EBITDA by Segment | ||||||||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Corporate | Total | North America | ELA | Specialty | Consumer | Corporate | Total | |||||||||||||||||||||||||
Operating Earnings (Loss) | $ | 30.6 | $ | 6.8 | $ | 3.4 | $ | 2.8 | $ | 0.7 | $ | 44.3 | $ | 26.7 | $ | 6.2 | $ | 1.9 | $ | 4.6 | $ | (2.0 | ) | $ | 37.4 | |||||||||||
% Net Sales | 9.8 | % | 6.9 | % | 6.2 | % | 4.0 | % | n/a | 8.3 | % | 9.0 | % | 6.4 | % | 3.8 | % | 6.3 | % | n/a | 7.2 | % | ||||||||||||||
Add: Restructuring / Impairment Expenses | — | — | — | — | — | — | — | — | — | — | 1.9 | 1.9 | ||||||||||||||||||||||||
Adjusted Operating Earnings (Loss) | $ | 30.6 | $ | 6.8 | $ | 3.4 | $ | 2.8 | $ | 0.7 | $ | 44.3 | $ | 26.7 | $ | 6.2 | $ | 1.9 | $ | 4.6 | $ | (0.1 | ) | $ | 39.3 | |||||||||||
% Net Sales | 9.8 | % | 6.9 | % | 6.2 | % | 4.0 | % | n/a | 8.3 | % | 9.0 | % | 6.4 | % | 3.8 | % | 6.3 | % | n/a | 7.6 | % | ||||||||||||||
Other Income (Expense), net | — | — | — | — | (0.6 | ) | (0.6 | ) | — | — | — | — | (1.0 | ) | (1.0 | ) | ||||||||||||||||||||
Add: Depreciation and Amortization | 6.1 | 2.2 | 1.7 | 2.2 | 0.1 | 12.3 | 7.2 | 1.9 | 1.9 | 2.3 | 0.1 | 13.4 | ||||||||||||||||||||||||
Adjusted EBITDA | $ | 36.7 | $ | 9.0 | $ | 5.1 | $ | 5.0 | $ | 0.2 | $ | 56.0 | $ | 33.9 | $ | 8.1 | $ | 3.8 | $ | 6.9 | $ | (1.0 | ) | $ | 51.7 | |||||||||||
% Net Sales | 11.7 | % | 9.1 | % | 9.3 | % | 7.1 | % | n/a | 10.4 | % | 11.5 | % | 8.3 | % | 7.5 | % | 9.5 | % | n/a | 10.0 | % | ||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Corporate | Total | North America | ELA | Specialty | Consumer | Corporate | Total | |||||||||||||||||||||||||
Operating Earnings (Loss) | $ | 112.8 | $ | 20.7 | $ | 11.9 | $ | 9.3 | $ | 0.2 | $ | 154.9 | $ | 95.2 | $ | 19.7 | $ | 7.6 | $ | 8.4 | $ | (4.6 | ) | $ | 126.3 | |||||||||||
% Net Sales | 11.3 | % | 6.9 | % | 7.0 | % | 4.4 | % | n/a | 9.2 | % | 10.2 | % | 6.4 | % | 4.7 | % | 4.4 | % | n/a | 7.9 | % | ||||||||||||||
Add: Restructuring / Impairment Expenses | — | — | — | — | — | — | — | — | — | — | 1.9 | 1.9 | ||||||||||||||||||||||||
Add: Acquisition-Related Inventory Adjustments | — | — | — | — | — | — | — | — | — | 7.8 | — | 7.8 | ||||||||||||||||||||||||
Acquisition Expenses | — | — | — | — | — | — | — | — | — | — | 2.2 | 2.2 | ||||||||||||||||||||||||
Adjusted Operating Earnings (Loss) | $ | 112.8 | $ | 20.7 | $ | 11.9 | $ | 9.3 | $ | 0.2 | $ | 154.9 | $ | 95.2 | $ | 19.7 | $ | 7.6 | $ | 16.2 | $ | (0.5 | ) | $ | 138.2 | |||||||||||
% Net Sales | 11.3 | % | 6.9 | % | 7.0 | % | 4.4 | % | n/a | 9.2 | % | 10.2 | % | 6.4 | % | 4.7 | % | 8.5 | % | n/a | 8.7 | % | ||||||||||||||
Other Income (Expense), net | — | — | — | — | (0.7 | ) | (0.7 | ) | — | — | — | — | (1.1 | ) | (1.1 | ) | ||||||||||||||||||||
Add: Depreciation and Amortization | 21.0 | 6.6 | 5.5 | 6.5 | 0.3 | 39.9 | 21.4 | 6.3 | 5.4 | 5.3 | 0.2 | 38.6 | ||||||||||||||||||||||||
Adjusted EBITDA | $ | 133.8 | $ | 27.3 | $ | 17.4 | $ | 15.8 | $ | (0.2 | ) | $ | 194.1 | $ | 116.6 | $ | 26.0 | $ | 13.0 | $ | 21.5 | $ | (1.4 | ) | $ | 175.7 | ||||||||||
% Net Sales | 13.4 | % | 9.0 | % | 10.2 | % | 7.5 | % | n/a | 11.5 | % | 12.5 | % | 8.5 | % | 8.1 | % | 11.2 | % | n/a | 11.0 | % | ||||||||||||||
D. Organic Sales Growth (Decline) by Segment | ||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Total | North America | ELA | Specialty | Consumer | Total | |||||||||||||||||||||
Net Sales, as reported | $ | 312.7 | $ | 98.9 | $ | 54.7 | $ | 70.2 | $ | 536.5 | $ | 296.0 | $ | 97.3 | $ | 50.5 | $ | 72.6 | $ | 516.4 | ||||||||||
% change from PY | 5.6 | % | 1.6 | % | 8.3 | % | (3.3 | )% | 3.9 | % | ||||||||||||||||||||
Proforma Adjustments | ||||||||||||||||||||||||||||||
Currency Translation Effects (1) | 2.7 | 5.2 | 0.1 | 0.2 | 8.2 | — | — | — | — | — | ||||||||||||||||||||
Net sales, proforma | $ | 315.4 | $ | 104.1 | $ | 54.8 | $ | 70.4 | $ | 544.7 | $ | 296.0 | $ | 97.3 | $ | 50.5 | $ | 72.6 | $ | 516.4 | ||||||||||
% change from PY | 6.6 | % | 7.0 | % | 8.5 | % | (3.0 | )% | 5.5 | % | ||||||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Total | North America | ELA | Specialty | Consumer | Total | |||||||||||||||||||||
Net Sales, as reported | $ | 998.9 | $ | 302.1 | $ | 170.2 | $ | 211.1 | $ | 1,682.3 | $ | 932.4 | $ | 307.0 | $ | 160.5 | $ | 191.6 | $ | 1,591.5 | ||||||||||
% change from PY | 7.1 | % | (1.6 | )% | 6.0 | % | 10.2 | % | 5.7 | % | ||||||||||||||||||||
Proforma Adjustments | ||||||||||||||||||||||||||||||
Currency Translation Effects (1) | 11.4 | 24.4 | 0.5 | 0.7 | 37.0 | — | — | — | — | — | ||||||||||||||||||||
Acquisition | — | — | — | (35.4 | ) | (35.4 | ) | — | — | — | — | — | ||||||||||||||||||
Acquisition Intercompany Elimination | — | — | — | 5.2 | 5.2 | — | — | — | — | — | ||||||||||||||||||||
Net sales, proforma | $ | 1,010.3 | $ | 326.5 | $ | 170.7 | $ | 181.6 | $ | 1,689.1 | $ | 932.4 | $ | 307.0 | $ | 160.5 | $ | 191.6 | $ | 1,591.5 | ||||||||||
% change from PY | 8.4 | % | 6.4 | % | 6.4 | % | (5.2 | )% | 6.1 | % | ||||||||||||||||||||
(1) Currency translation effects represent the estimated net impact of translating current period sales and orders using the average exchange rates applicable to the comparable prior year period |
E. Organic Order Growth (Decline) by Segment | ||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Total | North America | ELA | Specialty | Consumer | Total | |||||||||||||||||||||
Orders, as reported | $ | 296.3 | $ | 94.5 | $ | 53.5 | $ | 64.5 | $ | 508.8 | $ | 282.3 | $ | 100.0 | $ | 53.2 | $ | 65.0 | $ | 500.5 | ||||||||||
% change from PY | 5.0 | % | (5.5 | )% | 0.6 | % | (0.8 | )% | 1.7 | % | ||||||||||||||||||||
Proforma Adjustments | ||||||||||||||||||||||||||||||
Currency Translation Effects (1) | 3.1 | 4.7 | 0.1 | 0.2 | 8.1 | — | — | — | — | — | ||||||||||||||||||||
Orders, proforma | $ | 299.4 | $ | 99.2 | $ | 53.6 | $ | 64.7 | $ | 516.9 | $ | 282.3 | $ | 100.0 | $ | 53.2 | $ | 65.0 | $ | 500.5 | ||||||||||
% change from PY | 6.1 | % | (0.8 | )% | 0.8 | % | (0.5 | )% | 3.3 | % | ||||||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||
2/27/16 | 2/28/15 | |||||||||||||||||||||||||||||
North America | ELA | Specialty | Consumer | Total | North America | ELA | Specialty | Consumer | Total | |||||||||||||||||||||
Orders, as reported | $ | 977.4 | $ | 315.4 | $ | 173.2 | $ | 207.5 | $ | 1,673.5 | $ | 914.3 | $ | 324.2 | $ | 163.5 | $ | 187.6 | $ | 1,589.6 | ||||||||||
% change from PY | 6.9 | % | (2.7 | )% | 5.9 | % | 10.6 | % | 5.3 | % | ||||||||||||||||||||
Proforma Adjustments | ||||||||||||||||||||||||||||||
Currency Translation Effects (1) | 9.9 | 25.5 | 0.5 | 0.7 | 36.6 | — | — | — | — | — | ||||||||||||||||||||
Acquisition | — | — | — | (33.1 | ) | (33.1 | ) | — | — | — | — | — | ||||||||||||||||||
Acquisition Intercompany Elimination | — | — | — | 4.1 | 4.1 | — | — | — | — | — | ||||||||||||||||||||
Orders, proforma | $ | 987.3 | $ | 340.9 | $ | 173.7 | $ | 179.2 | $ | 1,681.1 | $ | 914.3 | $ | 324.2 | $ | 163.5 | $ | 187.6 | $ | 1,589.6 | ||||||||||
% change from PY | 8.0 | % | 5.2 | % | 6.2 | % | (4.5 | )% | 6.1 | % | ||||||||||||||||||||
(1) Currency translation effects represent the estimated net impact of translating current period sales and orders using the average exchange rates applicable to the comparable prior year period |
F. Design Within Reach Studio Metrics | ||||||||||||
Studio Count | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
February 27, 2016 | February 28, 2015 | February 27, 2016 | February 28, 2015* | |||||||||
Beginning of Period | 32 | 37 | 33 | 39 | ||||||||
Studio Openings | — | — | 1 | 3 | ||||||||
Studio Closings | (2 | ) | (3 | ) | (4 | ) | (8 | ) | ||||
End of Period | 30 | 34 | 30 | 34 | ||||||||
Studio Selling Square Footage | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
February 27, 2016 | February 28, 2015 | February 27, 2016 | February 28, 2015* | |||||||||
Beginning of Period | 257,961 | 251,198 | 248,440 | 235,466 | ||||||||
Studio Openings | — | — | 15,115 | 36,986 | ||||||||
Studio Expansions | — | — | 3,906 | 2,681 | ||||||||
Studio Closings | (6,166 | ) | (6,600 | ) | (15,666 | ) | (30,535 | ) | ||||
End of Period | 251,795 | 244,598 | 251,795 | 244,598 | ||||||||
Studio Revenue Metrics | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
February 27, 2016 | February 28, 2015 | February 27, 2016 | February 28, 2015* | |||||||||
Average Studio Square Footage | 254,878 | 247,898 | 250,118 | 240,032 | ||||||||
Annualized Net Sales per Square Foot | $ | 589 | $ | 656 | $ | 629 | $ | 719 | ||||
Comparable Studio Sales | (4.8 | )% | 7.6 | % | (4.8 | )% | 5.0 | % |
G. Sales and Earnings Guidance - Upcoming Quarter | Company Guidance | ||
Q4 Fiscal 2016 | |||
Net Sales | $560 million to $580 million | ||
Gross Margin % | 38% to 39% | ||
Operating Expenses* | $165 million to $169 million | ||
Effective Tax Rate* | 28% to 30% | ||
Earnings Per Share, Diluted* | $0.57 to $0.61 |
This information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act, as amended, that are based on management’s beliefs, assumptions, current expectations, estimates, and projections about the office furniture industry, the economy, and the company itself. Words like “anticipates,” “believes,” “confident,” “estimates,” “expects,” “forecasts,” likely,” “plans,” “projects,” “should,” variations of such words, and similar expressions identify such forward-looking statements.These statements do not guarantee future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict with regard to timing, extent, likelihood, and degree of occurrence. These risks include, without limitation, the success of our growth strategy, employment and general economic conditions, the pace of economic recovery in the U.S and in our International markets, the increase in white-collar employment, the willingness of customers to undertake capital expenditures, the types of products purchased by customers, competitive-pricing pressures, the availability and pricing of raw materials, our reliance on a limited number of suppliers, our ability to expand globally given the risks associated with regulatory and legal compliance challenges and accompanying currency fluctuations, the ability to increase prices to absorb the additional costs of raw materials, the financial strength of our dealers and the financial strength of our customers, our ability to locate new DWR studios, negotiate favorable lease terms for new and existing locations and the implementation of our studio portfolio transformation, our ability to attract and retain key executives and other qualified employees, our ability to continue to make product innovations, the success of newly-introduced products, our ability to serve all of our markets, possible acquisitions, divestitures or alliances, the pace and level of government procurement, the outcome of pending litigation or governmental audits or investigations, political risk in the markets we serve, and other risks identified in our filings with the Securities and Exchange Commission.Therefore, actual results and outcomes may materially differ from what we express or forecast. Furthermore, Herman Miller, Inc., undertakes no obligation to update, amend or clarify forward-looking statements. |