Herman Miller earns $22.5M in 1Q14

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Herman Miller has released its earnings for the first quarter of fiscal 2014.

Sales

Net sales were $468.1 million, an increase of 4.1 percent from the same quarter last year.

New orders were $471.2 million, 4.2 percent higher than last year.

Sequentially, net sales increased 1.8 percent from the fourth quarter of fiscal 2013, while orders improved 2.1 percent.

Sales and new order levels were mixed across Herman Miller’s business segments, with North American business continuing to “face the headwind of declining federal government orders,” according to Herman Miller CEO Brian Walker.

The office furniture manufacturer’s Specialty and Consumer segments remain “a positive growth influence overall.”

Income

Zeeland-based Herman Miller (NASDAQ: MLHR) earned $22.5 million in the quarter, or diluted earnings per share of 38 cents, marking a 12.5-percent increase over $20 million in the same quarter last year.

The quarter “reflects continued progress in the execution of our strategy, with a strong contribution from the higher margin growth categories and related channels where we have been steadily expanding our presence,” Walker said.

“It also reflects operating improvements we have implemented in some of our operations that have been underperforming,” added Walker. “These results demonstrate that our strategy of innovation, diversification and operational excellence is working.”

Operating earnings

Operating earnings were 8.4 percent of net sales, an improvement from 7.6 percent a year ago.

The company’s earnings in the quarter were reduced by costs associated with the previously announced strategy to terminate its domestic defined benefit pension plans.

The results were also negatively impacted by non-recurring amortization of costs capitalized in inventory as part of the acquisition of Maharam, a New York fabric design company.

When excluding these expenses, adjusted operating earnings in the first quarter were 9.3 percent of net sales — the highest level achieved by the company in almost five years. 

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