Steelcase Inc. (SCS) has reported a 6.70 percent fall in profit for the quarter ended May 26, 2017. The company has earned $18.10 million, or $0.15 a share in the quarter, compared with $19.40 million, or $0.16 a share for the same period last year. On an adjusted basis, earnings per share were at $0.15 for the quarter compared with $0.18 in the same period last year.
Revenue during the quarter went up marginally by 2.27 percent to $735.10 million from $718.80 million in the previous year period. Gross margin for the quarter expanded 106 basis points over the previous year period to 33.03 percent. Total expenses were 95.93 percent of quarterly revenues, up from 95.37 percent for the same period last year. That has resulted in a contraction of 57 basis points in operating margin to 4.07 percent.
Operating income for the quarter was $29.90 million, compared with $33.30 million in the previous year period.
However, the adjusted operating income for the quarter stood at $29.90 million compared to $37.90 million in the prior year period. At the same time, adjusted operating margin contracted 121 basis points in the quarter to 4.07 percent from 5.27 percent in the last year period.
"Our first quarter results were consistent with our expectations. All segments continued to deliver on our strategy, including record levels of revenue and operating income from our Asia Pacific business again this quarter," said Jim Keane, president and chief executive officer. "Order growth from new products in the Americas has also been strong, as customers are continuing to shift from traditional furniture applications to our new solutions. We have continued to invest in product development across our portfolio and expect to launch more new products and enhancements over the balance of our fiscal year than in any of the past five years."
For the second-quarter 2018, Steelcase Inc. projects revenue to be $758 million and forecasts revenue to be in the range of $750 million to $780 million. The company forecasts diluted earnings per share to be $0.31. On an adjusted basis, the company forecasts diluted earnings per share to be $0.32. It expects diluted earnings per share to be in the range of $0.21 to $0.25.
Operating cash flow remains negative
Steelcase Inc. has spent $50.50 million cash to meet operating activities during the quarter as against cash outgo of $65.70 million in the last year period. Cash flow from investing activities was $18.70 million for the quarter, down 64.65 percent or $34.20 million, when compared with the last year period.
The company has spent $22.20 million cash to carry out financing activities during the quarter as against cash outgo of $36.40 million in the last year period.
Cash and cash equivalents stood at stood at $143.90 million as at May 26, 2017.
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