Steelcase reports sharp decline

March 31, 2009
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Steelcase Inc. announced its results for the fourth quarter of fiscal year 2009 today with revenue of $654.9 million, a loss of 27.3 percent when compared to last year’s fourth quarter revenue of $901.2 million. The net loss from the previous quarter was $65.7 million, equaling $.47 per share.

Cost of sales increased to 72.5 percent of sales along with operating costs, which jumped 13 percent from last year’s fourth quarter to 39.7 percent of sales, or $259.8 million.

Fiscal year 2008 ended at $3.42 billion; the company came in at $3.18 billion of revenue for fiscal year 2009, a net loss of $11.7 million or $.09 per share. Operating income was down to $1.0 million for fiscal 2009; $202.8 million in fiscal 2008. The downslide was mostly caused by lower volume, non-cash impairment charges, restructuring costs, and more.

“Fiscal 2009 was a year of tremendous volatility,” said James P. Hackett, president and CEO. “Uncertainty prevailed early in the year and in the second half, the full impact of the economic weakness affected industry demand. Accordingly, we have continued to reduce our cost structure through a variety of actions in order to soften the impact and sustain our focus on longer-term growth initiatives.”

Though Steelcase still predicts the first quarter of fiscal 2010 to be down by approximately $525 million to $575 million, compared to $816 million in fiscal 2009’s first quarter; Hackett remains hopeful. One reason for hope is the slight seasonal improvements in order patterns, which come off a rapidly decline for the majority of the fourth quarter.

“During a period of high volatility and on-going uncertainty in the global economy, Steelcase employees are continuing to focus on winning new business, reducing our operating costs and delivering on the promise of our brands,” said Hackett. “We are also in a great position with a strong balance sheet and a strong liquidity profile.”

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