Published in Breaking News

Amid flat growth, Steelcase projects declining revenue ahead

BY Friday, June 24, 2016 03:17pm

GRAND RAPIDS — While Steelcase Inc.’s first quarter earnings largely met executives’ expectations, the company projects a decline in revenues and orders in its second quarter, driven largely by uncertainty in the global market.

The Grand Rapids-based office furniture manufacturer generated nearly $719 million in sales in its first quarter, which ended May 27, according to a statement. That’s an approximate 2-percent increase compared to the same period in the prior fiscal year. At the same time, Steelcase reported earnings of 16 cents per share in the first quarter of its 2017 fiscal year, equal to earnings in the same period a year ago.

While growth in the first quarter was relatively flat, Steelcase expects revenues to fall 3 percent to 6 percent year-over-year to between $770 million and $795 million in its second quarter.

The office furniture maker cited a “significant” decline in orders from the energy market and weakness in international markets.

“If overall orders continue to weaken, it may take a little longer for us to return to profitability than we planned,” said Jim Keane in a conference call with brokerage analysts, regarding the softness in international markets.

Steelcase’s stock priced slipped in accordance with its softer-than-expected guidance for the second quarter 2017, falling from $14.80 per share to $13.27 per share the morning following the company’s earnings release.

“While we are forecasting an organic revenue decline in the second quarter, we remain positive about our longer-term prospects,” Steelcase CFO and Vice President Dave Sylvester said in the statement.

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