Herman Miller Profit Falls, Outlook Weak; Stock Down - Update

(RTTNews) - Office furniture maker Herman Miller Inc (MLHR), Wednesday reported a decline in fourth-quarter profit, hurt mainly by restructuring and other charges that offset a 6 percent increase in sales. However, earnings topped Wall Street estimates, but sales fell short of expectations on weakness at its North American division.

Moving ahead, Herman Miller provided weak outlook for the first quarter, sending its shares down 6 percent in after-hours trade on the Nasdaq.

CEO Brian Walker said, "Our results this quarter reflected an overall pace and timing of new orders that was a bit slower than we anticipated..."

The Zeeland, Michigan-based company posted quarterly net earnings of $16.6 million or $0.28 per share, compared with $23.4 million or $0.40 per share last year.

Results for the quarter included restructuring and impairment charges of $21.4 million.

Excluding items, adjusted earnings for the quarter were $0.50 per share, compared with $0.43 per share a year ago.

On average, four analysts polled by Thomson Reuters expected earnings of $0.46 per share for the quarter. Analysts' estimates typically exclude special items.

Sales for the fourth quarter climbed to $487.5 million from $460 million in the prior year, while analysts expected revenues of $496.6 million.

Sales at the company's key North American segment edged down 1.4 percent from last year. Sales at ELA segment, or international sales, were up 10.6 percent, on growth in the U.K., while its Specialty and Consumer segment jumped 43.3 percent.

Gross margin for the fourth quarter climbed 130 basis points to 36.7 percent for the quarter, partly on recent price increases, but operating margin slid to 5.4 percent from 7.8 percent.

For the first quarter, Herman Miller projects earnings of $0.44 to $0.48 per share and sales of $480 million to $500 million. Analysts currently expect earnings of $0.48 per share on sales of $498.5 million.

The company's stock closed Wednesday at $31.68, up $0.41 or 1.31%, on a volume of 415k shares on the Nasdaq. In after hours, the stock dropped $1.99 or 6.28% at $29.69.