MillerKnoll (MLKN) investor relations material

Executive summary

• Net sales rose 10.9% year-over-year to $955.7 million, with organic growth of 10.0% and strong profitability gains; adjusted EPS increased 25% to $0.45.

• Orders declined 5.4% year-over-year, mainly due to a significant order pull-forward in the prior quarter for North America Contract.

• Leadership changes included a new Board Chair and COO, with a focus on leveraging talent and integrating operations.

• Strategic priorities remain on product innovation, execution, and cost management to drive profitable growth.

• Operating margin improved to 5.6% from 1.8% in the prior year; adjusted operating margin rose to 6.3%.

Financial highlights

• Gross margin was 38.5%, down 50 basis points year-over-year, impacted by $8 million in net tariff-related costs.

• Adjusted operating expenses were $308.0 million, or 32.2% of sales.

• Net earnings attributable to shareholders were $20.2 million, compared to a loss of $1.2 million a year ago.

• Cash and cash equivalents at quarter-end were $167.2 million, with total liquidity of $480.5 million.

• Net debt to EBITDA ratio at 2.92x, well below lending agreement limits.

Outlook and guidance

• Q2 net sales expected between $926 million and $966 million; adjusted EPS guidance is $0.38 to $0.44.

• Gross margin for Q2 expected between 37.6% and 38.6%; adjusted operating expenses forecasted at $300–$310 million.

• Tariff impacts expected to reduce Q2 gross margin by $2–$4 million before tax, with mitigation actions planned for the second half.

• Incremental operating expenses from new store openings estimated at $4–$5 million in Q2, with similar impacts expected each quarter this year.

• Full-year capital expenditures projected at $120–$130 million, up from $107.6 million in the prior year.