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Steelcase reports leap in 4th quarter sales and profit

Friday 23 March 2012

Steelcase Inc. Has reported 4th quarter sales of $690.2 million and net income of $14.9 million, or $0.11 per share. Excluding restructuring costs, adjusted earnings were $0.14 per share. Revenue and earnings per share were within company estimates. Steelcase reported $622.9 million of revenue and earnings of $0.08 per share in the 4th quarter of the prior year. Year on year sales jumped 10.8%.
Organic revenue growth in the 4th quarter was 10% after adjusting for the net favourable impact of $11 million associated with acquisitions and divestitures and approximately $3 million related to unfavourable currency translation effects. The Americas posted 13 % organic growth over the prior year and EMEA grew organically by 4 %. Revenue growth in the Americas was broad-based and included a higher mix of project revenue from some of the company's largest corporate customers.
"The Americas had another great quarter, achieving double digit organic revenue growth for the sixth consecutive quarter," said James P. Hackett, president and CEO. "4th quarter orders and backlog in the Americas remained strong and as a result, we expect the sales momentum to continue into the first quarter of fiscal 2013."
Steelcase's double digit gain in North America sales stands in stark contrast to Herman Miller's North America segment decline of 9.8% reported yesterday.
The Board of Directors of Steelcase Inc. today declared a cash dividend of $0.09 per share, which is an increase of $0.03 per share or 50% compared to the dividend for the prior quarter, to be paid on or before April 11, 2012 to shareholders of record as of April 2, 2012.
For the the full year, 2011, the company recorded $2.75 billion of revenue and net income of $56.7 million, or $0.43 per share, which compares to $2.44 billion of revenue and net income of $20.4 million, or $0.15 per share, in fiscal 2011. Organic revenue growth was 14 % over the prior year.
Operating income of $97.1 million for fiscal 2012 compared to operating income of $51.5 million in fiscal 2011, which included $21 million associated with IDEO which was not consolidated during the current year. Current year results included $(30.5) million of restructuring costs compared to $(30.6) million in the prior year.
"Overall organic growth of 14 % was fuelled by 19 % organic growth in the Americas which we believe exceeded industry growth rates for the same period."
4th quarter order growth in the Americas approximated 19 % compared to the prior year, or approximately 13 % when adjusted for the estimated pull-forward impact of a November 2010 price increase. The company expects first quarter fiscal 2013 revenue to be in the range of $665 to $690 million. Steelcase expects to report earnings between $0.08 and $0.12 per share for the first quarter of fiscal 2013, including restructuring costs of approximately $0.02 per share. On a sequential basis, this estimate reflects the company's expectation for a continued higher level of project revenue from some of its largest corporate customers, continuation of costs associated with the consolidation of manufacturing facilities and lower spending on product development and other initiatives. Steelcase reported earnings of $0.06 per share in the first quarter of fiscal 2012, including restructuring costs of approximately $0.05 per share.
"Steelcase celebrated its 100th anniversary last week, a milestone few companies have achieved," Mr. Hackett said. "Our ideas and insights have fuelled our global leadership of this industry, and we expect to build on that leadership next year and over the years to come."

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