Kimball Int'l (KBAL) Misses Q3 EPS by 7c

Kimball Int'l (NASDAQ: KBAL) reported Q3 EPS of ($0.03), $0.07 worse than the analyst estimate of $0.04. Revenue for the quarter came in at $138.7 million versus the consensus estimate of $142.34 million.

CEO Kristie Juster commented, “In the third quarter, we moved ahead with several important initiatives aligned with our strategy to drive sustainable share gains, as our end markets adapt to a post-pandemic operating environment. Although challenging business conditions persisted throughout what is our seasonally slowest quarter, we were pleased to see order rates in our Workplace and Health end markets improve progressively during the period, and that positive trend continued into April. Additionally, our bidding activity in the third quarter was substantially higher sequentially in both Workplace and Health, which together accounted for nearly 80% of our fiscal year-to-date sales. As expected, the impact of inflationary pressures on raw materials and continued high logistics costs were most pronounced in the third quarter and will begin to be mitigated in future quarters by our recent price increases and continued manufacturing cost savings which will drive substantial improvement in gross margin levels in the fourth quarter.

“In the third quarter, we also made significant progress in our Health business qualifying over 100 additional products into the US Department of Veterans Affairs. We continue to gain traction by leading with our health experts in addressing the needs of the top health and government systems and are expanding our reach into adjacent health categories. In Hospitality, custom product, which has higher margins, accounted for 50% of our year-to-date sales in this market, up from 30% one year ago. We expect the recovery in Hospitality to be uneven and phased as leisure, business and international travel each ramps at a different pace, and we continue to closely manage our costs in this area.”

“At Kimball International, we have been actively engaged in understanding The Future of Work. At the center of the new forming hybrid model is a belief that flexibility in where you work will allow employers to attract, retain and develop the most qualified and diverse workforce. It is clear the office plays a crucial role as the centralized hub for collaboration, learning and teamwork, complemented by both work from home and satellite locations. Our third quarter activity shows the rapid pace at which we are launching new products to support wherever work happens. Poppin launched Spaces which is a first ever system of flexible walls for open spaces, National launched Eklund flexible seating solution for open social settings, and Etc. expanded our work from home desk assortment. Later in May, we also will move forward with the full roll out of Poppin Pro into the Kimball International Dealer Network. Our powerful portfolio of brands and range of options allows us to support the needed flexibility and adaptability to plan for today and tomorrow.

For earnings history and earnings-related data on Kimball Int'l (KBAL) click here.

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