Business Highlights

  • Consolidated Gross margin improved 450 basis points over the prior year, with expansion reported in all three segments.
  • Continued actions focused on streamlining and reducing the operating cost structure and enhancing operating efficiencies while driving long-term top line growth and margin improvement.
  • $153 million of run-rate cost synergies related to the Knoll integration captured to date. offer.

The company’s Consolidated Gross margin improved 450 basis points in the previous year, with expansion in all three segments. The company is focusing on streamlining and reducing costs, enhancing efficiency, and driving long-term growth. The Knoll integration has captured $153 million in run-rate cost synergies.

The Global Retail segment’s net sales fell 17.0% in Q3, primarily due to soft housing-related demand, while new orders fell 14.6%. Despite these challenges, the company remained committed to improving in-store experiences, expanding product assortment, and boosting brand awareness. 

This strategic approach aims to cultivate brand loyalty and engagement, while mitigating external economic factors’ impact on organic demand. The adjusted operating margin for this segment was 5.6%, a 10 basis point increase year-over-year, driven by improved operational and delivery efficiencies and a favourable product mix.

The Americas Contract segment reported net sales of $441.1 million in Q3, down 9.0% YoY and 9.2% organically. New orders fell by 9.0% YoY and 9.4% organically. Demand remained softer than expected due to minimal economic improvement. 

Despite the persistence of inflationary pressures and high interest rates, key forward-looking indicators like customer inquiries and project opportunities suggest demand improvement. 

The adjusted operating margin for the Americas Contract segment was 8.1%, 70 basis points lower year-over-year. The main driver of this variance was lower sales, partially offset by gross margin expansion due to favourable price/cost dynamics, moderating input costs, and synergy benefits.

Source: Office Insight
Source: MillerKnoll