Steelcase(US:SCS)2024-12-20 16:30Revenue Performance - Revenue for Q3 2025 was $794.9 million, an increase of $17.0 million or 2% compared to Q3 2024, driven by volume growth in the Americas [26]. - Organic revenue growth in Q3 2025 was 3%, with a 7% increase in the Americas and an 8% decline in International markets [28]. - Year-to-date revenue for 2025 was $2,378.0 million, a decrease from $2,384.4 million in the same period of 2024 [25]. - Revenue for year-to-date 2025 was $2,378.0 million, representing a decline of $6.4 million compared to the prior year, driven by lower volume in International and the impact of a divestiture in the Americas [38]. - The Americas revenue represented 77.3% of consolidated revenue in Q3 2025, with a 5% increase compared to the prior year driven by higher volume and pricing benefits [45]. - Revenue increased by $55.0 million or 3% in year-to-date 2025 compared to the prior year [47]. Cost and Expenses - Cost of sales as a percentage of revenue improved by approximately 120 basis points in Q3 2025 compared to the prior year, with a 190 basis point improvement in the Americas [28]. - Operating expenses increased by $17.3 million in Q3 2025, or 160 basis points as a percentage of revenue, influenced by higher employee costs and variable compensation expenses [28]. - Operating expenses decreased by $16.6 million year-to-date 2025, or 60 basis points as a percentage of revenue, compared to the prior year, reflecting a $42.1 million gain on the sale of land [32]. - Operating expenses increased by $12.6 million in Q3 2025, or 70 basis points as a percentage of revenue, compared to the prior year [47]. - Operating expenses decreased by $12.3 million in year-to-date 2025, or 90 basis points as a percentage of revenue, compared to the prior year [48]. Net Income and Earnings - Net income for Q3 2025 was $19.1 million, representing 2.4% of revenue, compared to $30.8 million or 4.0% in Q3 2024 [23]. - Adjusted diluted earnings per share for Q3 2025 were $0.16, down from $0.26 in Q3 2024 [24]. - Net income for year-to-date 2025 was $93.1 million, with diluted earnings per share of $0.78, compared to net income of $59.8 million and diluted earnings per share of $0.50 in the prior year [38]. - The company reported a net income of $93.1 million for the nine months ended November 22, 2024, up from $59.8 million in the prior year, representing a growth of approximately 56% [69]. International Performance - International revenue decreased by 6% in Q3 2025, primarily due to declines in most Asia Pacific markets [26]. - The operating loss in International was $5.5 million in Q3 2025, a decline of $12.1 million compared to operating income of $6.6 million in the prior year [52]. - Adjusted operating loss of $2.4 million in Q3 2025 represented a decline of $11.8 million compared to adjusted operating income of $9.4 million in the prior year [52]. Liquidity and Cash Flow - Total liquidity sources available as of November 22, 2024, amounted to $900.7 million, an increase from $807.3 million on February 23, 2024 [59]. - Cash and cash equivalents totaled $365.2 million as of November 22, 2024, with 87% located in the U.S. [66]. - Net cash provided by operating activities decreased to $147.9 million for the nine months ended November 22, 2024, compared to $251.3 million for the same period in 2023, reflecting a decline of approximately 41% [69]. - Cash used in investing activities totaled $(28.0) million for the nine months ended November 22, 2024, compared to $(5.2) million in the same period of 2023, indicating a significant increase in investment outflows [70]. - The company experienced a net increase in cash and cash equivalents of $46.5 million for the nine months ended November 22, 2024, compared to $171.9 million in the prior year [68]. Shareholder Returns - The company repurchased 2,864,002 shares of Class A common stock in year-to-date 2025, compared to 512,707 shares in year-to-date 2024, reflecting a substantial increase in share repurchases [73]. - Dividends declared and paid per common share remained consistent at $0.100 for each quarter in both year-to-date 2025 and 2024, totaling $0.300 for the year [73]. Capital Expenditures and Investments - Capital expenditures for year-to-date 2025 are expected to total approximately $50 million, alongside an additional $50 million for capitalized costs related to cloud computing arrangements [75]. - The company has a global committed bank facility of $300.0 million, with no borrowings outstanding as of November 22, 2024 [74]. - Total long-term debt as of November 22, 2024, was $446.9 million, consisting of term notes due in 2029 with an effective interest rate of 5.6% [74].