Document

•獲益於利潤轉型計畫和協同加速，強勁的收益增長。盡管營收較去年同期下滑，第三季度非通用會計每股收益同比增長11%。整合營業利潤率按照通用會計原則和非通用會計原則拓展了220個基點，與去年同期相比，非通用會計營業利潤率達到2004年來最高的第三季度水平。非通用會計與通用會計調和表附在本次基本報表中。

•2025年和2026年的盈利前景提高。公司繼續預計從kimball international（“KII”）收購協同效應（3000萬美元）和其墨西哥工廠的提升（1500萬至2000萬美元）將為2025-2026年帶來4500萬至5000萬美元的節省。這兩個倡議本身將使2026年以前的每股收益增加0.70至0.80美元。預計KII收購帶來的總協同效應增加了1000萬美元，達到6000萬美元，2024年實現3000萬美元。

•2025年展望仍然正面；然而預計第四季度將有成交量壓力。訂單率和預訂指標繼續令人鼓舞。辦公家具訂單在第三季度同比增長了百分之一，並在最近幾週內有所增強。此外，辦公家具2025年的銷售渠道同比增長了超過百分之十，預示著更強勁的2025年增長。第三季度住宅建材產品訂單同比增長了百分之三，與去年同期持續增長，第四季度初期仍有增長。然而，美國選舉和更廣泛的宏觀環境的不確定性導致許多客戶，特別是在辦公家具行業，減少了短週期交易性購買，進一步推遲項目。因此，預計第四季度收入將與去年同期相比在兩個行業中均出現下降。

「我們的成員再次交出了一季度強勁的盈利增長。我們繼續展示我們能夠在具挑戰性的市場環境中實現盈利增長。第三季度的非通用會計每股收益同比增長了11%，這還要加上一個非常強勁的去年同期比較，當時盈利增長超過30%。我們的第三季度每股收益在過去三年中增加了一倍以上。」

在職場家居部門，我們的利潤轉型計劃和加速KII協同效應推動了部門的非GAAP營業利潤率達到了20年來的最高水平，這是第三季。盡管我們第三季的業績沒有受益於頂線增長，預計第四季的營業收入將較去年同期低，訂單模式最近顯示出改善，預示著2025年更強勁的表現。

在住宅建材業務方面，盡管住房市場波動持續存在，但非GAAP營業利潤率在第三季度同比擴大，超過18％。從長遠來看，我們對住房市場的前景感到看好，尤其是在我們市場領先的定位和盈利模式。然而，在第四季度，預計住房市場波動和經濟不確定性將對年度銷售業績造成壓力。



HNI公司 - 第三季財務業績
(金額單位：百萬美元，每股資料均指每股)。
	結束於三個月的期間
	九月二十八日, 2024		九月三十日， 2023		變化
GAAP
淨銷售額	$672.2		$711.6		(5.5	%)
毛利潤 %	41.5	%	40.1	%	140	基點
銷售及管理費用 %	31.0	%	31.4	%	-40	基點

重組和減值損失 %	0.2	%	0.7	%	-50	基點
營業收入	$68.9		$56.8		21.3	%
營業收入%	10.2	%	8.0	%	220	基點
有效稅率	23.1	%	20.3	%
凈利潤%	7.1	%	5.3	%	180	基點
每股收益 - 攤薄後	$0.98		$0.80		22.5	%

非美國通用會計準則
毛利潤%	41.7	%	40.1	%	160	基點
營業收入	$72.3		$65.2		10.8	%
Operating Income %	10.7	%	9.2	%	150	基點
有效稅率	23.1	%	21.4	%
每股收益 - 攤薄後	$1.03		$0.93		10.8	%

•合併淨銷售額基本報表顯示，與去年同期相比，淨銷售額減少了5.5%，降至67220萬美元。在有機基礎上，淨銷售額同比減少了4.5%。2023年第三季度，KII的Poppin業務脫售使年度淨銷售額減少了770萬美元。有機淨銷售額（一項非通用會計原則指標）與淨銷售額的調解將在本公告的基本報表後給出。


Workplace Furnishings – Third Quarter Financial Performance
(Dollars in millions)
	Three Months Ended
	September 28, 2024		September 30, 2023		Change
GAAP
Net Sales	$505.1		$536.8		(5.9	%)
Operating Income	$57.7		$47.3		22.1	%
Operating Income %	11.4	%	8.8	%	260	bps

Non-GAAP

Operating Income	$60.0		$53.6		11.9	%
Operating Income %	11.9	%	10.0	%	190	bps

•Workplace Furnishings operating margin of 11.4 percent improved 260 basis points versus the prior-year quarter, driven by improved net productivity and costs associated with the exit of Poppin incurred in the prior-year quarter, partially offset by lower sales volume and current restructuring costs. Third quarter non-GAAP operating profit margin was 11.9 percent, an improvement of 190 basis points year-over-year.


Residential Building Products – Third Quarter Financial Performance
(Dollars in millions)
	Three Months Ended
	September 28, 2024		September 30, 2023		Change
GAAP
Net Sales	$167.1		$174.8		(4.4	%)
Operating Income	$29.9		$30.9		(3.1	%)
Operating Income %	17.9	%	17.7	%	20	bps

Non-GAAP
Operating Income	$31.0		$30.9		0.5	%
Operating Income %	18.6	%	17.7	%	90	bps

•Residential Building Products operating profit margin of 17.9 percent increased 20 basis points year-over-year driven by favorable price-cost, net productivity, and product mix, partially offset by lower sales volume and restructuring charges incurred in the current quarter. Third quarter non-GAAP operating profit margin was 18.6 percent, an improvement of 90 basis points year-over-year.

•Demand environment. For the fourth quarter of 2024, Workplace Furnishings net sales are expected to decrease at a low-to-mid single-digit rate year-over-year. This new outlook reflects the impact of uncertainty around the U.S. elections and the broader macroeconomic environment, which are causing customers to reduce their short cycle transactional purchases and further delay projects. Fourth quarter net sales in the Residential Building Products segment are projected to decline at a low single-digit rate versus the same period in 2023 as incoming orders have been negatively impacted by record-low housing turnover, elevated interest rates, ongoing affordability issues, and economic uncertainty.

•Fourth quarter earnings. Non-GAAP earnings per share in the fourth quarter are expected to decrease from 2023 levels. For the full year, non-GAAP EPS is expected to increase at a rate of 10 percent or more for the third consecutive year, driven by margin expansion in both Workplace Furnishings and Residential Building Products.

•Elevated earnings growth visibility beyond 2024. The Corporation now expects $80 to $85 million of benefits associated with KII synergies ($60 million) and the ramp of its Mexico facility ($20 to $25 million). Both initiatives are currently underway and are providing benefit in 2024. These initiatives also provide visibility to future earnings growth with an estimated $45 to $50 million benefiting the 2025-2026 period.

“While our fourth quarter expectations move lower, we believe the pressures in both segments are temporary and expect improving revenue trends to complement our margin support initiatives and drive continued earnings growth and cash flow generation. Our core areas of focus are unchanged. We will continue to deliver margin expansion in Workplace Furnishings and drive long-term revenue growth in Residential Building Products,” concluded Mr. Lorenger.

HNI Corporation will host a conference call on Tuesday, October 29, 2024 at 10:00 a.m. (Central) to discuss third quarter fiscal year 2024 results. To participate, call 1-855-761-5600 – conference ID number 7175411. Both a live webcast and webcast replay will be available on HNI Corporation’s website at https://investors.hnicorp.com/events-and-presentations.

HNI Corporation (NYSE: HNI) has been improving where people live, work, and gather for more than 75 years. HNI is a manufacturer of workplace furnishings and residential building products, operating under two segments. The Workplace Furnishings segment is a leading global designer and provider of commercial furnishings, going to market under multiple unique brands. The Residential Building Products segment is the nation’s leading manufacturer and marketer of hearth products, which include a full array of gas, electric, wood, and pellet-burning fireplaces, inserts, stoves, facings, and accessories. More information can be found on the Corporation’s website at www.hnicorp.com.

This release contains "forward-looking" statements based on current expectations regarding future plans, events, outlook, objectives, financial performance, expectations for sales growth, and earnings per diluted share (GAAP and non-GAAP), including statements regarding future levels of demand, anticipated macroeconomic conditions, expected differences in seasonality and its effects on the Corporation’s results of operations, the anticipated benefits and cost synergies of the acquisition of Kimball International, and future levels of productivity. Forward-looking statements can be identified by words including “expect,” “believe,” “anticipate,” “estimate,” “may,” “will,” “would,” “could,” “confident”, or other similar words, phrases, or expressions. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Corporation’s actual future results and performance to differ materially from expected results. Actual results could differ materially from those anticipated in the forward-looking statements and from historical results due to the risks and uncertainties described elsewhere in this release and in the Corporation’s filings with the Securities and Exchange Commission, including but not limited to: the Corporation’s ultimate realization of the anticipated benefits of the acquisition of Kimball International; disruptions in the global supply chain; the effects of prolonged periods of inflation and rising interest rates; labor shortages; the levels of office furniture needs

and housing starts; overall demand for the Corporation’s products; general economic and market conditions in the United States and internationally; industry and competitive conditions; the consolidation and concentration of the Corporation’s customers; the Corporation’s reliance on its network of independent dealers; change in trade policy; changes in raw material, component, or commodity pricing; market acceptance and demand for the Corporation’s new products; changing legal, regulatory, environmental, and healthcare conditions; the risks associated with international operations; the potential impact of product defects; the various restrictions on the Corporation’s financing activities; an inability to protect the Corporation’s intellectual property; cybersecurity threats, including those posed by potential ransomware attacks; impacts of tax legislation; and force majeure events outside the Corporation’s control, including those that may result from the effects of climate change. A description of these risks and additional risks can be found in the Corporation’s annual and quarterly reports filed with the Securities and Exchange Commission on Forms 10-K and 10-Q. The Corporation assumes no obligation to update, amend, or clarify forward-looking statements, except as required by applicable law.


	Three Months Ended				Nine Months Ended
	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023
Net sales	$	672.2	$	711.6	$	1,883.9	$	1,754.2
Cost of sales	393.4		426.3		1,110.9		1,079.0
Gross profit	278.8		285.3		773.0		675.2
Selling and administrative expenses	208.4		223.3		617.3		602.2

Restructuring and impairment charges	1.6		5.3		3.7		13.4
Operating income	68.9		56.8		151.9		59.6
Interest expense, net	7.1		9.4		22.1		17.5
Income before income taxes	61.8		47.4		129.8		42.1
Income taxes	14.3		9.6		28.6		15.6
Net income	47.5		37.8		101.2		26.5
Less: Net income attributable to non-controlling interest	0.0		0.0		0.0		0.0
Net income attributable to HNI Corporation	$	47.5	$	37.8	$	101.2	$	26.5

Average number of common shares outstanding – basic	47.7		46.6		47.3		43.8
Net income attributable to HNI Corporation per common share – basic	$	1.00	$	0.81	$	2.14	$	0.60
Average number of common shares outstanding – diluted	48.7		47.3		48.4		44.5
Net income attributable to HNI Corporation per common share – diluted	$	0.98	$	0.80	$	2.09	$	0.60

Foreign currency translation adjustments	$	(0.0)	$	(0.2)	$	(0.1)	$	(0.2)
Change in unrealized gains (losses) on marketable securities, net of tax	0.3		(0.0)		0.3		0.1

Change in derivative financial instruments, net of tax	(1.8)		—		(0.0)		(0.1)
Other comprehensive income (loss), net of tax	(1.4)		(0.2)		0.2		(0.2)
Comprehensive income	46.1		37.5		101.4		26.3
Less: Comprehensive income attributable to non-controlling interest	0.0		0.0		0.0		0.0
Comprehensive income attributable to HNI Corporation	$	46.1	$	37.5	$	101.4	$	26.3

(Unaudited)


	September 28, 2024		December 30, 2023
Assets
Current Assets:
Cash and cash equivalents	$	34.3	$	28.9
Short-term investments	5.9		5.6
Receivables	261.1		247.1
Allowance for doubtful accounts	(2.3)		(3.5)
Inventories, net	210.3		196.6
Prepaid expenses and other current assets	52.4		61.3

Total Current Assets	561.7		535.9
Property, Plant, and Equipment:
Land and land improvements	59.4		58.9
Buildings	416.8		406.8
Machinery and equipment	699.4		705.8
Construction in progress	20.7		22.2
	1,196.4		1,193.7
Less accumulated depreciation	(656.9)		(638.5)
Net Property, Plant, and Equipment	539.5		555.2
Right-of-use Finance Leases	12.2		12.2
Right-of-use Operating Leases	107.4		115.2
Goodwill and Other Intangible Assets, net	631.5		651.9

Other Assets	61.2		58.4
Total Assets	$	1,913.4	$	1,928.8
Liabilities and Equity
Current Liabilities:
Accounts payable and accrued expenses	$	431.3	$	418.7
Current maturities of debt	50.9		7.5
Current maturities of other long-term obligations	2.2		7.3
Current lease obligations - Finance	4.9		4.4
Current lease obligations - Operating	25.0		25.9

Total Current Liabilities	514.3		463.7
Long-Term Debt	294.5		428.3
Long-Term Lease Obligations - Finance	7.4		7.9
Long-Term Lease Obligations - Operating	98.3		104.0
Other Long-Term Liabilities	78.8		78.0
Deferred Income Taxes	73.1		85.1
Total Liabilities	1,066.4		1,167.0
Equity:
HNI Corporation shareholders’ equity	846.6		761.4
Non-controlling interest	0.3		0.3
Total Equity	846.9		761.8
Total Liabilities and Equity	$	1,913.4	$	1,928.8


	Nine Months Ended
	September 28, 2024		September 30, 2023
Net Cash Flows From (To) Operating Activities:
Net income	$	101.2	$	26.5
Non-cash items included in net income:
Depreciation and amortization	80.1		68.3
Other post-retirement and post-employment benefits	0.8		0.8
Stock-based compensation	13.7		11.3


Deferred income taxes	(11.7)		(6.0)


Other – net	4.2		5.2
Net increase (decrease) in cash from operating assets and liabilities	(5.1)		63.0
Decrease in other liabilities	(7.8)		(6.7)
Net cash flows from (to) operating activities	175.5		162.5

Net Cash Flows From (To) Investing Activities:
Capital expenditures	(41.2)		(61.9)

Acquisition spending, net of cash acquired	—		(369.7)
Capitalized software	(2.0)		(0.9)
Purchase of investments	(3.1)		(3.8)
Sales or maturities of investments	4.5		4.0
Net proceeds from sale of subsidiary	—		3.1
Other – net	0.2		1.5
Net cash flows from (to) investing activities	(41.7)		(427.6)

Net Cash Flows From (To) Financing Activities:
Payments of debt	(354.0)		(304.3)
Proceeds from debt	262.4		625.3
Dividends paid	(47.9)		(43.5)
Purchase of HNI Corporation common stock	(24.8)		—
Proceeds from sales of HNI Corporation common stock	45.4		1.8
Other – net	(9.6)		(7.1)
Net cash flows from (to) financing activities	(128.5)		272.1



Net increase in cash and cash equivalents	5.3		6.9
Cash and cash equivalents at beginning of period	28.9		17.4
Cash and cash equivalents at end of period	$	34.3	$	24.4


	Three Months Ended				Nine Months Ended
	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023
Net Sales:
Workplace furnishings	$	505.1	$	536.8	$	1,425.1	$	1,249.5
Residential building products	167.1		174.8		458.8		504.7
Total	$	672.2	$	711.6	$	1,883.9	$	1,754.2

Income (Loss) Before Income Taxes:
Workplace furnishings	$	57.7	$	47.3	$	138.3	$	59.2
Residential building products	29.9		30.9		71.0		74.5
General corporate	(18.8)		(21.4)		(57.4)		(74.0)

Operating income	68.9		56.8		151.9		59.6
Interest expense, net	7.1		9.4		22.1		17.5
Total	$	61.8	$	47.4	$	129.8	$	42.1

Depreciation and Amortization Expense:
Workplace furnishings	$	18.7	$	16.8	$	54.3	$	41.7
Residential building products	3.6		3.5		10.7		10.2
General corporate	5.0		5.4		15.2		16.4
Total	$	27.3	$	25.6	$	80.1	$	68.3

Capital Expenditures (including capitalized software):
Workplace furnishings	$	11.2	$	18.8	$	29.7	$	50.6
Residential building products	1.7		2.7		6.0		10.1
General corporate	1.6		0.1		7.5		2.1
Total	$	14.5	$	21.6	$	43.2	$	62.8

					As of September 28, 2024		As of December 30, 2023
Identifiable Assets:
Workplace furnishings					$	1,291.5	$	1,311.4
Residential building products					482.4		467.1
General corporate					139.5		150.3
Total					$	1,913.4	$	1,928.8

This earnings release includes certain non-GAAP financial measures as defined by Securities and Exchange Commission Regulation G. Pursuant to the requirements of this regulation, reconciliations of historical non-GAAP financial measures to the most directly comparable historical GAAP measures are included below and throughout this earnings release. This information gives investors additional insights into HNI’s financial performance and operations. While HNI’s management believes the non-GAAP financial measures are useful in evaluating HNI’s operations, this information should be considered supplemental and not in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. In addition, these measures may be different from similarly titled non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.

To supplement the condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, this earnings release contains the following non-GAAP financial measures: organic net sales and non-GAAP gross profit, operating income, operating profit, income taxes, net income, and net income per diluted share (EPS). These measures are adjusted from the comparable GAAP measures to exclude the impacts of the selected items as summarized in the tables below. Generally, non-GAAP EPS is calculated using HNI’s overall effective tax rate for the period, as this rate is reflective of the tax applicable to most non-GAAP adjustments. In the prior-year quarter, the effective tax rate used to calculate non-GAAP EPS differs from the GAAP effective tax rate due to the impact of nondeductible charges associated with the acquisition of Kimball International.

The sales adjustments to arrive at the non-GAAP organic net sales information presented in this earnings release relate to the exclusion of net sales of Poppin in the prior-year period. The transactions excluded for purposes of other non-GAAP financial information included in this earnings release include: professional fees and other costs related to the acquisition of Kimball International; restructuring charges recorded to cost of sales comprised of accelerated depreciation, asset disposals, inventory valuation adjustments, and relocation and new facility setup costs in the Workplace Furnishings segment; costs associated with the exit of the Poppin business; current period costs associated with factory consolidation initiatives in the Workplace Furnishings segment; current period restructuring activities related to the Residential Building Products segment; and prior period impairment charges in the Workplace Furnishings segment related to an office building and the disposal of information technology assets.

This earnings release refers to our expectations regarding non-GAAP EPS. The Corporation is unable to provide a reconciliation of this forward-looking non-GAAP measure to future EPS without unreasonable effort due to the uncertainty regarding, and to the potential variability of, many of the costs and expenses that could potentially impact EPS calculated on a GAAP basis. These items include, but are not limited to, impairments, financial impacts from changes in legal, regulatory, and tax requirements, charges related to actions taken to improve future profitability, and the impact of acquisitions and divestitures, if any. These items necessary to reconcile forward-looking non-GAAP EPS to EPS could be material and have a significant impact on the Corporation’s results computed in accordance with GAAP.


HNI Corporation Reconciliation
(Dollars in millions)
	Three Months Ended
	September 28, 2024									September 30, 2023
	Workplace Furnishings			Residential Building Products			Total			Workplace Furnishings		Residential Building Products		Total
Net sales as reported (GAAP)	$	505.1		$	167.1		$	672.2		$	536.8	$	174.8	$	711.6
% change from PY	(5.9		%)	(4.4		%)	(5.5		%)


Less: Poppin divestiture	—			—			—			7.7		—		7.7

Organic net sales (non-GAAP)	$	505.1		$	167.1		$	672.2		$	529.2	$	174.8	$	704.0
% change from PY	(4.5		%)	(4.4		%)	(4.5		%)


HNI Corporation Reconciliation
(Dollars in millions, except per share data)
	Three Months Ended
	September 28, 2024
	Gross Profit			Operating Income			Tax			Net Income			EPS
As reported (GAAP)	$	278.8		$	68.9		$	14.3		$	47.5		$	0.98
% of net sales	41.5		%	10.2		%				7.1		%
Tax %							23.1		%

Restructuring charges	1.8			3.4			0.8			2.6			0.05





Results (non-GAAP)	$	280.6		$	72.3		$	15.1		$	50.1		$	1.03
% of net sales	41.7		%	10.7		%				7.5		%
Tax %							23.1		%



HNI Corporation Reconciliation
(Dollars in millions, except per share data)
	Three Months Ended
	September 30, 2023
	Gross Profit			Operating Income			Tax			Net Income			EPS
As reported (GAAP)	$	285.3		$	56.8		$	9.6		$	37.8		$	0.80
% of net sales	40.1		%	8.0		%				5.3		%
Tax %							20.3		%

Restructuring charges	0.3			5.4			1.1			4.2			0.09
Impairment charges	—			0.2			0.0			0.2			0.00


Acquisition costs	—			2.8			1.1			1.7			0.04

Results (non-GAAP)	$	285.6		$	65.2		$	11.9		$	43.9		$	0.93
% of net sales	40.1		%	9.2		%				6.2		%
Tax %							21.4		%



Workplace Furnishings Reconciliation
(Dollars in millions)
	Three Months Ended
	September 28, 2024			September 30, 2023			Percent Change

Operating income as reported (GAAP)	$	57.7		$	47.3		22.1	%
% of net sales	11.4		%	8.8		%

Impairment charges	—			0.2
Restructuring charges	2.3			5.4
Acquisition costs	—			0.8



Operating income (non-GAAP)	$	60.0		$	53.6		11.9	%
% of net sales	11.9		%	10.0		%



Residential Building Products Reconciliation
(Dollars in millions)
	Three Months Ended
	September 28, 2024			September 30, 2023			Percent Change
Operating income as reported (GAAP)	$	29.9		$	30.9		(3.1	%)
% of net sales	17.9		%	17.7		%

Restructuring charges	1.1			—





Operating income (non-GAAP)	$	31.0		$	30.9		0.5	%
% of net sales	18.6		%	17.7		%