MillerKnoll(US:MLKN)2023-01-11 21:07Financial Performance - Net earnings for the six months ended December 3, 2022, were $44.9 million, a significant recovery from a net loss of $59.2 million in the same period last year[9]. - The company reported a net loss of $61.3 million for the six months ended November 27, 2021, compared to a net loss of $1.7 million in the same period the previous year[12]. - For the three months ended December 3, 2022, net earnings attributable to MillerKnoll, Inc. were $16.0 million, compared to a net loss of $1.7 million for the same period in 2021[45]. - The company reported a total operating loss of $32.2 million for the six months ended December 3, 2022, compared to a loss of $107.1 million for the same period in 2021[87]. - The company reported a net periodic benefit cost of $(0.5) million for the three months ended December 3, 2022, compared to $0.3 million in the prior year[44]. Revenue and Sales - Total revenue for the three months ended December 3, 2022, was $1,066.9 million, a 3.5% increase from $1,026.3 million for the same period in 2021[27]. - Total revenue for the six months ended December 3, 2022, reached $2,145.7 million, up 18.1% from $1,816.0 million in the prior year[27]. - The Americas Contract segment generated $1,067.1 million in revenue for the six months ended December 3, 2022, compared to $880.6 million in the same period of 2021, reflecting a 21.2% increase[27]. - Customer deposits recognized as net sales amounted to $25.7 million and $104.8 million for the three and six months ended December 3, 2022, respectively[28]. - The product revenue from single performance obligations was $2,004.3 million for the six months ended December 3, 2022, compared to $1,678.7 million for the same period in 2021, reflecting a growth of 19.3%[23]. Assets and Liabilities - Total current assets decreased slightly to $1,309.9 million from $1,317.9 million as of May 28, 2022[8]. - Total liabilities decreased to $2,907.2 million from $2,980.0 million, indicating improved financial stability[8]. - Cash and cash equivalents decreased to $197.5 million from $230.3 million, reflecting a net decrease of $32.8 million during the period[9]. - Long-term debt increased to $1,434.8 million from $1,379.2 million, reflecting strategic financing decisions[8]. - Total current liabilities decreased to $773.2 million from $877.4 million, a reduction of 11.9%[8]. Equity and Dividends - Stockholders' equity increased to $1,434.3 million from $1,427.1 million, demonstrating a positive trend in retained earnings[10]. - The company has maintained a consistent dividend payout of $0.1875 per share, reflecting commitment to returning value to shareholders[10]. - Dividends paid amounted to $28.4 million, compared to $25.4 million in the previous year[9]. - The company declared dividends of $0.1875 per share, totaling $14.3 million for the six months ended November 27, 2021[12]. - Retained earnings increased to $706.6 million from $693.3 million, a growth of 1.9%[10]. Operational Efficiency - The company reported a restructuring expense of $15.2 million, indicating ongoing efforts to optimize operations[9]. - The company incurred $8.7 million in costs related to the Knoll Integration for the six months ended December 3, 2022, significantly lower than the $95.8 million incurred in the same period of the previous year[91][94]. - The 2023 restructuring plan is projected to result in annualized expense reductions of approximately $30 million to $35 million, with severance and related charges of $14.7 million recorded for the three months ended December 3, 2022[95]. - Operating earnings for the total company reached $38.7 million for the three months ended December 3, 2022, compared to $6.2 million in the same period last year[87]. - Corporate expenses related to general functions amounted to $16.9 million for the three months ended December 3, 2022, down from $32.1 million in the same period of 2021[86]. Goodwill and Acquisitions - The company acquired Knoll, Inc. on July 19, 2021, which has been included in the financial results since the acquisition date[14]. - Goodwill related to the Knoll acquisition was recorded at $903.5 million, attributed to operational synergies and the assembled workforce[33]. - As of December 3, 2022, total goodwill was $1,217.4 million, down from $1,351.7 million as of May 28, 2022, due to foreign currency translation adjustments and accumulated impairment losses[39]. - The acquisition of Knoll, completed on July 19, 2021, had a total acquisition date fair value of $1,887.3 million, with cash consideration of $1,176.6 million[30][31]. - The company expects a substantial portion of the liability for the Knoll Integration as of December 3, 2022, to be paid in fiscal year 2023[93]. Tax and Interest Rates - The effective tax rate for the three months ended December 3, 2022, was 19.8%, a decrease from 77.6% in the prior year, primarily due to favorable foreign tax credit impacts[49]. - The effective tax rate for the six months ended December 3, 2022, was 19.2%, compared to 18.8% for the same period in 2021[50]. - The company recognized negligible interest and penalties related to uncertain tax benefits for the three and six months ended December 3, 2022[51]. - The carrying value of the company's long-term debt as of December 3, 2022, was $1,481.3 million, with a fair value of $1,380.9 million[55]. - The company has entered into interest rate swap agreements totaling a notional amount of $800 million, effectively converting floating interest rates to fixed rates[67].