hni-20240330

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM

10-Q

☒

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended

March 30, 2024

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number:

1-14225

HNI Corporation

Iowa

(Exact name of registrant as specified in its charter)

42-0617510

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

600 East Second Street

P.O. Box 1109

Muscatine

Iowa

52761-0071

(Address of principal executive offices) (Zip Code)

(

563

)

272-7400

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock

HNI

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes

☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Smaller reporting company

☐

Non-accelerated filer

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

☐

No ☒

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Common Stock, $1 Par Value

Outstanding as of

March 30, 2024

47,297,068


HNI Corporation and Subsidiaries
Quarterly Report on Form 10-Q

Table of Contents

PART I. FINANCIAL INFORMATION
		Page
Item 1.	Financial Statements (Unaudited)

	Condensed Consolidated Statements of Comprehensive Income - Three Months Ended March 30, 2024 and April 1, 2023	3

	Condensed Consolidated Balance Sheets - March 30, 202 4 and December 30, 2023	4

	Condensed Consolidated Statements of Equity - Three Months Ended March 30, 2024 a nd April 1, 2023	6

	Condensed Consolidated Statements of Cash Flows - Three Months Ended March 30, 2024 and April 1, 2023	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29

Item 4.	Controls and Procedures	29

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	29

Item 1A.	Risk Factors	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 3.	Defaults Upon Senior Securities - None	-

Item 4.	Mine Safety Disclosures - Not Applicable	-

Item 5.	Other Information	30

Item 6.	Exhibits	31

Signatures		32

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements


HNI Corporation and Subsidiaries Condensed Consolidated Statements of Comprehensive Income (In millions, except per share data)
(Unaudited)

	Three Months Ended
	March 30, 2024		April 1, 2023

Net sales	$	588.0	$	479.1
Cost of sales	355.1		304.8
Gross profit	232.8		174.3
Selling and administrative expenses	203.1		167.9

Restructuring charges	0.1		—
Operating income	29.7		6.4
Interest expense, net	7.6		2.7
Income before income taxes	22.0		3.8
Income tax expense	4.3		2.2
Net income	17.7		1.6
Less: Net income (loss) attributable to non-controlling interest	0.0		(0.0)
Net income attributable to HNI Corporation	$	17.7	$	1.6

Average number of common shares outstanding – basic	47.1		41.5
Net income attributable to HNI Corporation per common share – basic	$	0.38	$	0.04
Average number of common shares outstanding – diluted	48.1		42.1
Net income attributable to HNI Corporation per common share – diluted	$	0.37	$	0.04

Foreign currency translation adjustments	$	0.0	$	0.1
Change in unrealized gains (losses) on marketable securities, net of tax	(0.0)		0.2

Change in derivative financial instruments, net of tax	1.4		(0.1)
Other comprehensive income (loss), net of tax	1.4		0.1
Comprehensive income	19.0		1.7
Less: Comprehensive income (loss) attributable to non-controlling interest	0.0		(0.0)
Comprehensive income attributable to HNI Corporation	$	19.0	$	1.7

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Amounts may not sum due to rounding.


HNI Corporation and Subsidiaries Condensed Consolidated Balance Sheets (In millions)
(Unaudited)

	March 30, 2024		December 30, 2023
Assets
Current Assets:
Cash and cash equivalents	$	27.0	$	28.9
Short-term investments	5.5		5.6
Receivables	231.9		247.1
Allowance for doubtful accounts	(2.8)		(3.5)
Inventories, net	212.1		196.6

Prepaid expenses and other current assets	53.5		61.3

Total Current Assets	527.2		535.9

Property, Plant, and Equipment:
Land and land improvements	59.0		58.9
Buildings	409.6		406.8
Machinery and equipment	714.5		705.8
Construction in progress	21.8		22.2
	1,204.8		1,193.7
Less accumulated depreciation	(652.6)		(638.5)
Net Property, Plant, and Equipment	552.2		555.2

Right-of-use - Finance Leases	11.7		12.2

Right-of-use - Operating Leases	113.8		115.2

Goodwill and Other Intangible Assets, net	645.9		651.9

Other Assets	61.8		58.4

Total Assets	$	1,912.6	$	1,928.8

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Amounts may not sum due to rounding.


HNI Corporation and Subsidiaries Condensed Consolidated Balance Sheets (In millions)
(Unaudited)

	March 30, 2024		December 30, 2023
Liabilities and Equity
Current Liabilities:
Accounts payable and accrued expenses	$	363.7	$	418.7
Current maturities of debt	12.8		7.5
Current maturities of other long-term obligations	2.0		7.3
Current lease obligations - Finance	4.4		4.4
Current lease obligations - Operating	24.9		25.9

Total Current Liabilities	407.7		463.7

Long-Term Debt	460.2		428.3



Long-Term Lease Obligations - Finance	7.3		7.9

Long-Term Lease Obligations - Operating	103.7		104.0

Other Long-Term Liabilities	78.8		78.0

Deferred Income Taxes	83.0		85.1

Total Liabilities	1,140.8		1,167.0

Equity:









HNI Corporation shareholders’ equity	771.5		761.4

Non-controlling interest	0.3		0.3

Total Equity	771.8		761.8

Total Liabilities and Equity	$	1,912.6	$	1,928.8

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

Amounts may not sum due to rounding.


HNI Corporation and Subsidiaries Condensed Consolidated Statements of Equity (In millions, except per share data)
(Unaudited)

	Three Months Ended - March 30, 2024
	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Non-controlling Interest		Total Shareholders’ Equity
Balance, December 30, 2023	$	46.9	$	201.6	$	523.6	$	(10.6)	$	0.3	$	761.8
Comprehensive income:
Net income	—		—		17.7		—		0.0		17.7
Other comprehensive income (loss), net of tax	—		—		—		1.4		—		1.4



Dividends payable	—		—		(0.8)		—		—		(0.8)
Cash dividends; $0.32 per share	—		—		(15.1)		—		—		(15.1)

Common shares – treasury:
Shares purchased	(0.1)		(2.5)		—		—		—		(2.5)

Shares issued under Members’ Stock Purchase Plan and stock awards, net of tax	0.5		8.9		—		—		—		9.4
Balance, March 30, 2024	$	47.3	$	208.1	$	525.4	$	(9.3)	$	0.3	$	771.8





	Three Months Ended - April 1, 2023
	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Non-controlling Interest		Total Shareholders’ Equity
Balance, December 31, 2022	$	41.4	$	49.1	$	534.0	$	(8.0)	$	0.3	$	616.8
Comprehensive income:
Net income (loss)	—		—		1.6		—		(0.0)		1.6
Other comprehensive income (loss), net of tax	—		—		—		0.1		—		0.1



Dividends payable	—		—		(0.3)		—		—		(0.3)
Cash dividends; $0.32 per share	—		—		(13.3)		—		—		(13.3)
Common shares – treasury:
Shares purchased	—		—		—		—		—		—
Shares issued under Members’ Stock Purchase Plan and stock awards, net of tax	0.3		8.0		—		—		—		8.3
Balance, April 1, 2023	$	41.7	$	57.1	$	522.0	$	(7.9)	$	0.3	$	613.2