Steelcase expects 'significantly improved' profit, as more employees return to offices

By Bill Peters

'More companies are issuing return-to-office mandates,' CEO says, and that's good news for the office-furniture maker

Shares of Steelcase Inc. rallied after hours on Tuesday, after the office-furniture maker said it expects "significantly improved" profit as more employers order their workers back to the office.

For the full fiscal year, Steelcase (SCS) said it expects "significantly improved" adjusted earnings per share of between 80 cents and 90 cents, above FactSet estimates for 66 cents a share.

"More companies are issuing return-to-office mandates, and we're optimistic that our demand levels will improve as customers seek our help to evolve their workplaces to engage, connect and work better for their employees," Chief Executive Sara Armbruster said in a statement.

For its third quarter, Steelcase said it expects revenue to be in a range of $780 million to $805 million, compared with FactSet forecasts for $819 million in sales. The company said it expects adjusted earnings per share of 23 cents to 27 cents, above expectations for 19 cents a share.

Shares rose 5% in after-hours trading.

Steelcase reported earnings amid the push-and-pull of return-to-office mandates after the pandemic disrupted workplaces. For Steelcase's second quarter, sales fell, and the company leaned on higher prices to offset lower orders.

"Through the first half of the year, although project activity has softened, we've seen strong growth in our continuing business as customers make investments to refresh their existing spaces," Armbruster said.

The company reported second-quarter net income of $27.5 million, or 23 cents a share, compared with $19.6 million, or 17 cents a share, in the same quarter last year. Revenue fell to $854.6 million from $863.3 million in the prior-year quarter.

Adjusted for amortization and restructuring costs, Steelcase earned 31 cents a share.

Analysts polled by FactSet expected Steelcase to report adjusted earnings per share of 20 cents, on sales of $829 million.

-Bill Peters

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

09-20-23 0750ET

Copyright (c) 2023 Dow Jones & Company, Inc.