MillerKnoll (MLKN) 12 Jul 232023 Q4 Earnings call transcript

Good evening, and welcome to MillerKnoll's Fourth Quarter Earnings Conference Call.

As a reminder, this call is being recorded.

I would now like to introduce your host for today's conference, Vice President of Investor Relations, Carola Mengolini.

Carola Mengolini

Good evening, and welcome to MillerKnoll's fourth quarter fiscal 2023 conference call. Andi Officer. Executive by Stutz, and joined Financial Chief am Owen, Officer; Chief Jeff I during Q&A available Contract. Also the of Michael, Americas President session is John

I please to regarding Before information. call safe forward-looking our harbor Andi, the turn remember over

Please today's that press be During involves forward-looking evaluate expressed different and assume factors from information known discuss in the which cause the are as implied. of are uncertainties and which context risks, those no is may the update unknown actual or may we factors The call, other the supplement these management release. information of these forward-looking and results in to or and statements forward-looking statements. detailed today, obligation to

and Investor We posted press may also website to Relations non-GAAP refer reconciled in on described release certain our financial millerknoll.com. are at our which metrics

With Andi. over that, the will I call to turn

thank evening, call. Good everyone, Carola. Thanks, so and our joining much for you

power margin our and and results brands, model design, of improving we geographies Our business demonstrate and an in strengthening connected our innovate to balance fourth team By our diverse uncertain macroeconomic channels, our customers delivering the the innovative quarter and globe, leveraging our while around environment. of performance seize with sheet. ability the opportunities

recent is deliberate are staying about As quarters, cautious the we've still shared and their in environment challenging. Customers spending.

pattern financials. performances We look highlight continue our closer to has improve. noting orders in worth but strong he areas see our several our at as are across a Jeff demand and of softness started there provides of business our channels will to

and to form collective done the future-proof our retail we have of that investing early industry then, best in work excellence, will to know e-commerce worked to combining of and an drive I future our creating efficiently of our MillerKnoll, network brands operations across movers my want were Since our seat, portfolio as moving products, From highlight lot in we unrivaled in to and of business. along reach two streamline with global growth capability opportunities. innovation. space We a production and market we've centers these

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India, us with we're Additionally, of develop, as of our we solutions brands the globally continue Asia, our Middle China. design This our clients, and the allows network, as that meet Southeast taking expand to our dealer and into capacity demand collective presence our East, such expand to regions MillerKnoll leverage [indiscernible]. high-growth to

no time crystal will year's ball, believe economic I improve progresses. have I outlook that While as gradually this

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will perfect as flexibility spaces clients Asari, innovative Naoto introduced like strategy, that as height-adjustable success to productivity. example in with their nesting companies productivity to work surrounding four office persists North and for help and and Herman to the order to return crucial the and their unpredictability in America, inflection that workplace around it collaboration, new to flexibility. designs starting the while well Miller table, [indiscernible] wellness, be movable a they're to seemed and the return point; construct First, in a is office we're Products an second, our to achieve of rebuild revolves observe chairs, desired

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our spaces pace. enables fully to us MillerKnoll, a a to faster at realized However, bring life scale as

showroom Days, this highlights we customers underscores Design some excitement and and [indiscernible] leadership built healthcare the During offer in we've solutions. a our generated experience this distinctive that engagement by of space momentum vertical.

to sector us comprehensive a public portfolio and the and delivering giving unique well. larger-scale education presents We're higher MillerKnoll positive advantage space as experiencing traction services of in solutions projects For our our range customers. and this combined

in industry conditions, organization model. an long-term economic As the over our have health of navigating confidence the varying through business advantages we and a with of success, century of our

will to through well teams playbook prudent managing the We'll approach on focus us that has costs. our be term, balance for multiple We'll served thoughtfully a in long prioritize our we'll customers. We innovation, aligns and competitive opportunities. continue We'll our we'll to ensuring to our advantages, align talent long-term and we'll In and cycles. sales operating order deliver flow cash on focusing our levels. our efficiently, term, strongest free continue invest and the near spending with for using growth

you that, path. turn over to call now with deeper your With financials. at the the for look Jeff thank partnership I'll to for continued And want I a this us on

performance year. you. some our overview followed start some fiscal and Thanks, to Andi. the It's outlook Good of full for by the and and quarter with by our an everyone. evening, into good in the first I'll quarter targets highlights, fourth both insights full-year be providing

certain stemming fourth and variable $X.XX generated per of adjusted cost gross share, expenses. than earnings For net stronger midpoint of increased guidance. Overall, above slightly pressures development helped and from product our we the sales expected marketing, the quarter, margin alleviate

quarter level, sales the our of in the consolidated driven strong $XXX by fourth performance net million, midpoint guidance, were Contract in the slightly Americas segment. the At above

across our to improved we supply facilitated segments. of into inventory production more enhancements, This period. allowed anticipated fulfillment coming than Additionally, better us all chain reliability management faster shift backlog order initially and the

performance. margin improvement gross to pleased report We're in of another quarter

of and XXX on at year-over-year from higher synergies. higher basis adjusted points driven integration-related by sequential-quarter margin was mainly of price basis, was benefits increases basis consolidated realization our end and XXX gross This a Our points the the result high XX% guide.

margin Our was X.X% consolidated operating the quarter. for adjusted

flows Turning the sheet. balance to and cash

million This generated out to comfortably reduction approximately and $XX.X agreements. our in quarter, $XX we million management of lender of limit debt. We flow primarily by ratio in defined efforts. to finished quarter driven sales the cash working inventory the net fourth in Consequently, debt attributed us meaningful paid a a maximum our from we times, operations, EBITDA putting with X.X under capital,

absolute increase totaled compared to organic same a the at orders X.X% the to level an $XXX New new the million lower the of consolidated decrease quarter improved of X.X% when the while third decrease in And from year quarter, point and demand stabilization evidence sequential orders providing reflecting quarter. we're moving of the than the rate level that of a fourth quarter, of business. in were last year, last this

include fourth and organically take rates. observed project robust growth which segment's summarize uncertainty optimistic economic on of an million, the our orders operating for segment. our These far year-over-year general I'll the rates long this funnel in while year-over-year, is feels and activity. various to came a team term, indicators. very by moment quarter And weighed Within sales to were Clearly, Still, and to segment, down for Contract $XXX order first order quarter our X.X% decrease quarter organic thus Americas by medium $XXX performance reflecting supported has new year-over-year. XX.X% sales the the net million,

sequentially from up highlight quarter this both XX% of the segment, also by this price adjusted that is in an synergies. I'll challenges, integration-related margin which despite savings macro continued cost driven and and operating achieved we in benefit excess year-over-year,

and pertains In reflects heavily of quarter organically demand for while The an million, slowdown $XXX market spending organic product decrease Retail, housing it XX.X%. were discretionary on North effective Global new to which continue American operational sales for and on management came year-over-year, focusing to net mix goods efficiencies. orders As response, million, to optimization inventory the drive segment. we down reduced $XXX this to levels XX.X% affect are

to established leverage we brands awareness in prioritizing better Additionally, enhancing scale. most our also brand our and are in while channels order investments

International see more plans Contract MillerKnoll International $XXX in with the this mistake, year-over-year organic improved distribution our Miller demand are in about momentum additional date, the transitioned the scale Middle East, Korea encouraged dealership dealers are by growth we year optimistic ahead, the China. reflecting an We've also no And and phasing $XXX the Contract XX.X% totaled from full-line while we're we dealers. and has we're witnessed strong organically and specialty legacy to going year-over-year, for XX segment, To segment. In to sales beginning our million, into this dealers. network. million, down the in team full-line potential Herman growth. keep XX than Make very global by that new slight to and came India, to Turning net quarter orders demand reach achieving

volumes. to deliver been grateful their journey margin world. improvements, fiscal the team our work to full dedication for our around adjusted of a of elevated This net this has input the enabled year, been the capture the integration, the impact in and at and synergies year, totaled $X.X remarkable achieving earnings We're complex related and constrained $X.XX because by Knoll our better has this to costs target we've this and of members share. per talent For made Throughout totaled and billion synergy especially critical production given the I'm consolidated ability sales progress level efforts.

conclude prepared on I'll remarks fiscal outlook my XXXX. for few comments with our a

past pandemic all resulted aware, over the in introduced unprecedented business, couple abnormal As our into COVID-XX of years. trends we which the are dynamics

shifts the patterns quarter entire visibility comparison the year, both we we of periods. fiscal year. for providing improved anticipate to previous in begin certain recognized earnings we Consequently, new the As and sales fiscal the upcoming and significance in

Overall, we XXXX. fiscal expect in slightly net consolidated sales lower year-over-year

order funnel seasonality, As benefit fiscal weighted increases, and price the half sales quarterly opportunities and to and project historical we our to earnings of operating backlog, from to it earnings, as of be in XXXX. recent the current giving trends, factors beginning expect back cadence pertains such consideration expected

cautious outlook dynamics. due macroeconomic do to near-term maintain We a

optimistic at also are upcoming make and five improvement, of worth Americas noting. year. consolidated following weeks Order the However, New segment. I both Year the points in Contract level this us will the In highlight indicators first that feel trends the several the regard, have in about shown the

are sequential encouraging. Our prior-year the funnel project in year-over-year comparisons easing the and are trends and

Index, $X.XX into bolstered where year earnings of of such by $X.XX in the Billings for well range factors signs various supportive we full-line to consideration, And international as markets Architectural we're fiscal of sales, the share are growth low Second, Taking dealers. still and XXXX. GDP consumer expect these although key in new all home an positioned expect the relatively several third, MillerKnoll increasing indicators we showing improvement. and per generate number adjusted full sentiment,

quarter, let few factors first the guidance. to our me elaborate relates on it As a impacting

the heading running have a sluggish that past rates quarters consolidated order the resulted two the order backlog. have In into start we we over had same First, in the in reduction of QX last year. don't effect,

important XX week quarter standard first included year. it's of to of operations that million calendar. estimated That net added XX fiscal weeks to an the sales $XX Second, XXXX remember week consolidated last last versus the year extra

million, as salaries be consideration, the the $XXX And operating factors will we and in as expenses share and million $XXX to quarter the year, earnings partial incentive to of rate between into run and in higher range we per sales as million, of new these for a well expenses $X.XX and first Taking the enter reflect adjusted employee expense of quarter lastly, bonus fiscal million $X.XX. our $XXX on-target range expect quarter $XXX to wages. be net first

and now questions. that operator take I'll Okay. numbers, With the the the your turn we'll back of call overview to

We'll Instructions] Burns [Operator take with question Greg you. Thank from Sidoti. first our

afternoon. Good

I the I guess, So guide the just year. wanted touch for on to,

the on revenue we Can stronger the us So, half? about, just should was revenue on second about how of And earnings maybe half, give split the maybe what color for of percentage-wise of I the half the and little the first percentage-wise, cadence earnings driving or as a expected guess, earnings, we more side? think you think cadence year? back split

be Yeah. Greg, with Jeff. you. Good this to is

year. start give a going if to John, you have top you line growing we a move then few factors improved Let of the start I of and lean me with Andi might kind but want talked a perspective we're that and as on see here, to but us confidence that few. in me these, some through let

the particular. So entry we talked about already in we've of the improvement first the segment in in quarter, that seen levels weeks the fact Americas a notable in Contract order five

prepared strong traction. the mentioned I'd seeing that international quarters point to things continue remarks in performance We've dealer in already been we're further this my year to to relatively to be internationally, next gain of opportunities But in the and several and network I we seeing trends that specific expect funnel the expand are encouraging.

seeing growth year-over-year. the in I We order are mentioned trends. funnel the

leading look think starting confidence consumer you some turned life. future on reiterate history, be or are tends maybe the home I again. some ABI When at important nine has based to and so indicators into signs expansion of to began territory the levels. us to into indicator we're sales That an months see of The to to show

I So reiterate. would those are that more forward indicators

them thing network, but is on bulk up the already learning -- it that bulk and of behind team behind but we're our and now with is full the because integration the many got we're sell lifting largely not other I all offer. the important heavy getting the -- the would integration The sales focus takes say us done the speed months dealer that's the to of they've to of

we so, we've ramp, to faster. while a expect we and see that little spin And come still flywheel long begin to that expect to a way

further Greg, would layering do other on quarter. earnings we track good record We've expect got say, now showing a the benefit. is benefit after pricing The I pricing thing quarter in front,

that will costs. that up price up, as in fixed we lands put overhead benefit have XXXX, and expect against increases throughout leverage levels we've still We We that expect place back-half ramp to volume earnings, fiscal itself and to so continue. pick the which realize to

factors. the those major So are

full-year I'm to I'll -- pause tell we that those to Andi want some a collectively that fall anything. and simply We'll going short if giving of add just you there factors us that quarter-by-quarter you all number. I'm not you of view. see give can And confidence hit

you -- hoped been definitely Greg, more I than at thing if office, would moving to we're of look people see hit people probably would as as think in people back return has where have come add, is Jeff, having The to starting North sluggish We're decisions. we America, industry, it. particularly starting most to Yeah. together. more an on we I to it see

way so this the that as All moving, indicate of would research about need that we're think our that well. is we I to optimistic be

been think in I us. a really than Jeff two on say but funnel, encouraging touched the years, will which I this for better is is it's sign

retail side this the there, know operating And Thanks. do that current but it look Perfect. business, at then business lastly how on breakeven about the the environment? in of now you demand I quarter. investing you've was been

that can are So environment things view you demand you the optimize to that run and optimize impacts there that how business -- do you there business? how How do spend?

of be home the all mean, we couple I kind at look if next residential Greg, will quarters. Yes. our competitors I across of think there, and industry, the furnishings you industry, for probably the expect softer

are We new home encouraged going by up. sales

still some time bit, work it market think through. by estate little will We rebounding to we but are the a encouraged real take

are profitability. through working been we to we Knoll people building maximized really that have brand. has through the focusing Herman struggle efforts through really the our of But some see on really and where North we're And We're America, right around many on where inventory, necessarily on just real working now. the be in inventory. will our simplifying. as an seen that We're And been addressing focus whether that Knoll. but inventory DWR with Miller are these HAY, focusing internationally, not efforts expect of we sitting and wholesalers and our past simplification this we've on categories world piles we're with year inventory, not continuing So further

back see invest right but being climb to So the slow until we're how in year, very as improves in business expect over demand comes very, we force. the prudent now a we further that full customer

perspective from say, successfully will and off. that building invested bit quite we however, and paid a a brands we've there quite I marketing invested in have our where had

you. Thank great. Okay,

We'll from Tower Bugatch Research. Water take our with question next Budd

there. my thank everybody hope and I is for afternoon, you taking doing Good questions. okay

Hi, Budd.

Budd. Hey,

year. Thank do ending think we're backlog sales excessive year? off clear. has and really bit you. know compared for a low the Where largely been the to net will backlog where about in you for come think orders backlog the with the little starting what year? And for it's will I And look like Jeff do you talked a been you the

-- into a specifically heading go that to remarks revenue. to say, Well, detail I is we to standby, see that provide the we of means lower and to we're guide, XXXX didn't being simply we're intentionally of specific a didn't year-over-year lower with XX% outlined backlog the softer backlog, which from prepared slightly acknowledge fiscal revenue level running about down willing will but likely start kind

I move not XXXX Budd. expect than FY would that, accelerate of orders expect that qualitatively, year than provide through more for detail to I'm the the be balance going higher because to we total to do But year. any in we as the

that So your would of plan, year-over-year to up the backlog your goes if if meet are or Is the higher able thinking. imply the orders that end at you're correct… that meet year

That's correct. That's correct, Budd.

You it. got

We XXXX. backlog expect build to a throughout

you know and comes says the it $X.XX. work was where that would no quick do the Is around I think EPS programs. pencil be but impaired, name could But It ask at specifically. those trade -- they And on on and color you give the this maybe and can some of for about impairment us help guide quarter if some you where guidance We've give the restructuring affected us that a is? some got can looking little I'm QX, kind going GAAP GAAP reasonable? bit slow. where that to Okay. very restructuring My in?

sure about I EPS? Are your guide so midpoint the is you question. $X.XX, GAAP our I want understand EPS make but at to Well, talking

what's [Multiple trying adjustments going the figure to Speakers] in out Yes, I'm forward. GAAP.

Well, of reason to costs, tend of related and frankly, guiding amortization tell but item comparable an was they $X the to that some precision. what QX. quarter, is adjusted they're easy I past restructuring, and that restructuring million. to adjustment timing the of with would little to adjustments of have acquisition part would we're predict integration number the has level cost expect lumpy a in to to But in that is, fourth I the related not the consistent terribly a be we Knoll you been be the

of earnings would So $X.XX some to -- will costs number. little that's about would earnings tougher then are predict. we have And integration that there adjusted that reduce that be that a

why that's So we come But you're GAAP sure, going short through on amortization basis. that fell the number. giving a you of charge to for see

And gradually in know over activities is remarks, I our his expect adjustments cost out bulk would one Budd, to if the not, just ahead Jeff integration behind continue and those as or to achieve this of We to pointed thing, don't but really prepared time. us. are decrease

Thank how think that years you. that, leaves, you before that million, number have long right? think $X Yes, we of I know do [indiscernible]I still that a

Yes.

Yes. Yes. Budd. long-term That's a of amortize period that time, over will a asset long

And a in Is margin? you the is has gross One an quarterly, issue as daily something may there And in that is confuses or given thing the Or at is that Andi been have Okay. weekly retail volatile original maybe to answer gross really markdown me. imagine margin on basically that's inventory mark issue? that you of well. reduced? retail and as I quite to the least part the

were two throughout related. that to the first expect -- I inventory I would improve point the were we We that some fees demurrage storage that fourth alluded year, frankly, in had we remember, charges Andi quarter, moving that bit to had also had in forward. inventory-related quite the you'll is a will XXXX. us that And that we margin. recognized we period -- But the factors feeling plagued reduced and the fiscal in earlier would Yes.

defray of continued outbound price and though, a have the Those parcel strategies know I'd the rates working those costs, point have including they're And some number customers. that delivery make. to on category to to margins. to to is addition I that, freight elevated mainly decisions potential In team other has big they distribution have and pressure that to been freight

a degrading Budd, a a from And margin pricing would and seeing problem ton. been say pressure. perspective, We're I discounting not from our That margin perspective. not discounting has our not we're

And the got and what -- HAY domestically, at disparity some retail? stuff. Muuto, we have about of What's some we've gross have geographically we because overseas geographical DWR margin but

a demand say chain would businesses, I And supply the wholesalers challenges line I the everyone top that from that on and then bought which of when and those up most bought of faced. are started, wholesale, bottom in primarily ton based and are everyone think a perspective inventory as the international retail most line Ukraine war the challenged dropped.

seeing So wholesalers. of those lot we're a with pressure

see Now that's is the them we're through pressured European inventory good work that news coming but businesses. our and is to demand really back, starting

And that does seg, That… right? retail the flow through

used global makes it Yes, yes. Absolutely, the as which a didn't yes. now but yes, to part of It now, little does retail it confusing bit member.

want it? of right. during all Where if inventory last year much end inventory are you year? Okay, now or overall? you question. inventory for target the carrying we How Have the any? the the What's excess got the And

inventory flow. the some way. I working that cash capital unlocks down think, came significantly got we've in quarter. we've come That Inventory a Budd, long

think we'll team and to we towards for the we as albeit in holiday levels, with by like, be. seasonal retail think good inventory levels to large, we there the be feels that. need I in will where have example, are But period, move space, pretty I stocking the inventory in related changes some

internally, inventory. Where Budd, partners just be Yeah. their we really it's through need our working wholesale to

that inventory. their is And

a turned to that You've -- so already just you're waiting title

from buy but exactly. Yeah. their does Not affect to inventory, That's -- us. our it ability

for lastly, a you number? And did year, Jeff, give you. the Got CapEx

a spent CapEx XXXX. not in I'm in but We FY We happy did number, to. million give $XX

do And XXXX? you what in think

here the try to $XX number I do to range million that to $XXX to today, I a million. level our give that going keep flat you best year sit We're on as as we of to But can.

you and full very the the term Good Thanks, much. year. you. on Thank luck near Thank Jeff.

Budd. you, Thank

Thanks, Budd. care. Take

Reuben next question our Benchmark. with take We'll from Garner

Good Thanks. everybody. evening,

Hi, Reuben.

Jeff, the and robust about orders could pipeline us any year? of quantification the part the you that this early in fiscal you on growth talked and in give funnel

Sure, to. Reuben, happy

Let what the with made highlight to maybe me we've through pacing the a nice seen order in because fact in I'll the five start order with and in first weeks of levels. the remarks that we the the start point entry quarter improvement prepared quarter, some

So basis on the maybe begin, entry Contract were segment, organic in in to just reiterate, an to X% Americas year-over-year down order levels the fourth quarter.

In moved weeks we've X%. of the growth of five first QX, actually to about positive

Now share that. our a because by call couple is, got here we've later activity five it normally we're with little worth to of a normally you, encouraged -- of so weeks' weeks -- and but have and very we than conference full only is of a

the was easing other negative but -- were quarter. would that in as still order we We improvement to the trends we thing through saw I consolidated of level, move year-on-year, as only at signs modest as that The beginning say we is well. move through show improvement

let pause to speak me you can So the funnel. there. John, maybe

to rate. fine-tuned and Thanks, in compete we're couple put the Reuben, that beginning start to things. we terms in some add I'd the proposition that pay that strategies recessionary the bring together of point are and calendar in those progress the and and the in we've a commentary seen maybe environment, order really order of seeing to Jeff. to to value a of plan resources Sure. we've sales color just we At a the of really win off customers, rate, I year, deployment and and to think funnel in

anniversary improving was are we beginning collective Miller sell The other market dealers much drives I would we feel was products was the comment I well. dealers the anecdotally, group and as we confident brands of rates ready vice more full cross-sell and And Herman in just with what confidence think last called their legacy night much the a which it's a had really Knoll so ago and originally I thing so is, when say noticeable. more versus that versa. today to and of the year one-year passed that is And they order of that made with

the how volume Great. That's this level, the high a switch helpful. you perspective that have gave of you to what assumptions Maybe view carryover versus general way can with pricing from And better just is ask a already back then top for much Jeff, guidance that line. things kind that are? FY help you've could a us benefit a we I it year, will from to announced recognize price of the if at XXXX.

Yes. Maybe latter, easy me take to Reuben. just the it's for

business. and through a as as over tends an contract of time increase, take in was know of and elements of what price tailored business it that It how it increase but industry, a of pricing our an we think it. Contract So, was maybe average about X% price flows in the Americas just it you the period reminder to this in so October last did

takes get still of So layering better that. It it. a is year of the full to a impact that part

margin has and been contributed -- So we sequential that still seeing then. since improvements the meaningfully that we've to

increase averages just that X%, of beginning say in in price a addition, just July. and I when And put place then we

right collectively we -- my move about qualitatively very as it That's volume provide the sensitive. factors fully improve, the through So you're harder as volume leverage so I'll are to margin comment again levels in. because those to support will one earlier speak that. year. about impact just highlight expected we're comes -- is to The quantify where

around are increase to volume America, in the particularly factories world, but really levels. sensitive Our North

probably I as they can the as right but so, ramp that best offer you order we And that's will. those support levels expect now. That performance, too margin will

Reuben?

-- on we'll our next to All move right. And

still you are Reuben, with us?

Reuben has dropped.

Okay, got it.

like you. He either didn't

All Capital next Alex from question Group. with And our we'll to right. move Fuhrman on Craig-Hallum

year? question. factor Hey, I year? upcoming that Is to your relates for comparisons. Andi, this of ask a for as against expectation rest come up the taking into there bit? does tough guys, back incredibly the thanks consumer retail the the business. What's starting been have to obviously, this guidance year the for there it little And for wanted How your my to guidance about them

great as continue question. a we're going couple first earlier, it's we I think to said demand. Listen, think, see orders softer to I these Alex, of

we into As will difference encouraged sales. 'XX, a that year home we We're big makes by us. move, that start turn for we people the consumer When calendar to come see back.

they're people makes hasn't We quality today, that a as that at, sit what great think to they difference is changed. our we what look The rates as adapted we're at interest consumer where the AOV looking of news in purchasing. really

levels having want So we're not very them be. We're inventory our to discount are that. to where optimistic about we

right just those three. brands So top to kind on are important now really we those focusing of us

Focusing on kind currently don't our and that to come sort for of looking categories of we investment to while back. the reduce we wait consumer business maximize

they're and right think now, on travel, as But still I on. other on they're experiences, the year spending change I goes spending that we they're still there. think expect will

Jeff. this Alex, is

this my Just I [indiscernible] one and prepared more think remarks, in mention didn't bit mentioning. of color, I but it

year the watermark one our bear performance I in the the retail fiscal long thing other The think is affects the for is, cadence mind, of quarter that through seasonal business.

the in into promotional seasonality that's behaviors where months summer just scheduled, So that. -- events consumer and are all play and

as performance trends seasonal we QX improved So based we into expect beyond. do and just move on

of premium the a Okay. And all helpful. just That's difference in any mega some of the price points. your in Are those differently the of US certainly the of of comments you on based seeing are consumer. demand in -- brands them thinking about portfolio? your prices then anything seeing are sort And versus premium, abroad? kind but you really about then some Are

really kind goes I would earlier. say a I was what saying difference of to demand back in

with softer little I necessarily with a buildups, has really wholesale I think price the don't think to product. that internationally believe with partners. inventory that our seeing demand to I do points we're has in do

As quality the I for not discount. longer of there. is little consumer said, It's definitely us And pull quality piece the is is And we're important that and puzzle. the a this of to of but a consumer taking trigger people really the bit having there. to purchases, the to

Thank That's much. really very helpful. guys, you,

Thank you.

Company. Reuben a take from All Garner follow-up Benchmark question right. And with we'll

back. You're

Thanks.

dropped got and because the didn't asking I I didn't as drop I did I I the hear soon like I Yes, it. came and guys. just into tail it back as answer. not finished Sorry, then

Speakers] [Multiple

have in to about. do I -- more have want Yes, but the get I to transcript, that ask have I I'll one

mean, the side. at with turn-in see specifically the office Do upbeat. the I it customers, going more American that's about some was holding pipeline, to to Contract -- there and show So angst seems conversations at think macro the North longer-term uncertainty NeoCon. you up of your the at Or the trend? the look this definitely robust kind future just return of It like could just office you curious the orders on still businesses what with I'm about is it it's is point?

John, do you that want to take one?

Sure.

that having office is out, there of right in but it environment benefit and benefit of helps to think Andi of the the involve, how And burn see an opportunities the think and plays I companies to work where providing I and like and it's well-being that. address more for future is together, I feeling things belonging, are see times the mentioned we with for their people is the earlier, that to evolving than think for something still stress as connection continue going point that. inflection

help working think -- for back. towards the I I but companies we that definitely some asking hesitation how get do how there's and get in So people do are still moving hard our us really

XX more becoming in pretty It work other The to we've months was terms itself. approached in It ago, thing in of but all will loose positive are goes hybrid bode for the happen how trends the on. seen well much I offering office, guardrails around some is hybrid flexibility et and months year time those us think as putting And is that companies cetera. structured, employees work. changing six of is still

or Great. consumer And Or I to the was I'm business? but more, that quick say that to sneak MillerKnoll? one. just had retail was one a specific a one comment hear international and you inventory I comment And Did wholesale broad-based normalized? said, from another going a

No. clarification. Reuben, asked I'm you glad for

more become earlier own own in in we of inventory either to on was normalized. storage or had revenue Those in related more longer comment facilities. inventory have that on, progress levels business the we have the that actually and contract have the We our the that in to levels retail in we are be of business, fiscal recognized or warehouse inventory buildup So that in it our as waiting have work glut XXXX. no the

I Reuben. think is sense, our still there but makes inventory Andi's elevated affecting the that is comments, held not wholesale that's by inventory that partners if business

that and operating more with that management as we plants. integration and Toyota have maybe those efficient is pretty production that to and integrate one a system reduced add thing substantially can't we we've throughout plants, And gone we as MKPS more we had Miller operation, the that robust just to system in implemented Knoll process forget as our Knoll Yeah. our through call across we also inventory much our

us So part been has months. that XX XX that's last about contract of side and inventory has the also on reduced work better months the that taken to

efficient across to So -- to business. effective the inventory show and start up entire we're that come seeing management really

about again, in good Thanks guys, year. Great. and luck drop and sorry Congrats there. the the call

Reuben. you, Thank

right. All further to floor no remarks. Andi questions. We there turn And for are closing back CEO, Owen, the

quarterly are for everyone, of MillerKnoll, appreciate support your great us the our continued again, on forward updating and night. on joining looking Have you really we We next to call. a call. Thanks

now And that your Thank you today's for does conclude presentation. disconnect. you and participation may