MillerKnoll Inc Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Greg Burns - Sidoti & Company LLC - Analyst : Good afternoon. Could you just talk about your win rates in the Americas and maybe why you think -- maybe it's taking longer for some of this to move through your funnel? And do you feel like there's been any changes in share in the market? And do you feel like you maybe need to get more aggressive with maybe some of your incentives to start converting maybe some of what you're seeing in your pipeline? Thank you.

Question: Greg Burns - Sidoti & Company LLC - Analyst : Okay. And then, when you look at the balance sheet, obviously, generating cash looks like you bought back some stock this quarter. Are you comfortable with the leverage here? Like why not? What's your decision factor between buying back shares versus maybe paying down the debt? Thank you.

Question: Greg Burns - Sidoti & Company LLC - Analyst : All right. Thank you.

Question: Budd Bugatch - Water Tower Research LLC - Analyst : Good morning, Andi. Good morning, Jeff. Good morning -- good afternoon, Carola and John. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 27, 2024 / 9:00PM, MLKN.OQ - Q3 2024 MillerKnoll Inc Earnings Call

Question: Budd Bugatch - Water Tower Research LLC - Analyst : It is in the afternoon. And congratulations on the profitability in the quarter. I know that's a difficult thing, and you're managing that well. But I am concerned about what I see in the implied backlogs, particularly in the Americas contract, which looks to me to be somewhere, I think, probably in the $355 million to $360 million range, Jeff, if I did the math right?

Question: Budd Bugatch - Water Tower Research LLC - Analyst : And that's the lowest backlog in Americas contract since before the acquisition, since the acquisition, time of the acquisition. And it makes it -- I think you told me it makes it very difficult to leverage your manufacturing at that same time, so irrespective of the pricing. What's going on there? When will we see that backlog start to rise?

Question: Budd Bugatch - Water Tower Research LLC - Analyst : Okay. I have more on that, but I know I've got one more follow-up. And let me just go to the global retail because, again, that looks like that's a significant drawdown in backlog, not quite as severe as AC. But what -- can you talk a little bit, Andi, on the global retail, what you're seeing in terms of e-commerce versus in-store? How do we look on same store, same location, or same brand kind of basis, however you wanted to give us a flavor on that and the future of that particular segment as well? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 27, 2024 / 9:00PM, MLKN.OQ - Q3 2024 MillerKnoll Inc Earnings Call

Question: Budd Bugatch - Water Tower Research LLC - Analyst : So the average ticket in retail, are you in the $2,000 to $3,000 range?

Question: Budd Bugatch - Water Tower Research LLC - Analyst : Okay. All right. Thank you. Good luck on the following -- on the next quarters and the balance of the year.

Question: Alex Fuhrman - Craig-Hallum Capital, Inc. - Analyst : Hey, guys. Thanks very much for taking my question. Andi, you talked a little bit about consolidating some showrooms in an effort to align the cost structure. What about on the global retail side of the business? Do you think there are opportunities there to maybe consolidate some of your retail stores? Or are there still opportunities to continue to open more stores there?

Question: Alex Fuhrman - Craig-Hallum Capital, Inc. - Analyst : And Andi, are there any brands in particular you think are under stored or perhaps opportunity for multi-branded stores?

Question: Alex Fuhrman - Craig-Hallum Capital, Inc. - Analyst : Okay, that's great. Thank you very much.

Question: Reuben Garner - The Benchmark Company LLC - Analyst : Thanks. Good evening, everybody. Just wanted to kind of clarify plus square something up, Jeff. You talked about kind of maybe nearing or being at an inflection point. I don't know if that was in Americas specific comment or just kind of in general, but you're also announcing a restructuring, implementing cost savings, I would guess, because you've had kind of consistent order pressure over the last year or 18 months as you put it. Can you kind of walk us through the decision or the thought process there, why restructuring now if we're going to start coming out of this? And then I got a follow-up. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 27, 2024 / 9:00PM, MLKN.OQ - Q3 2024 MillerKnoll Inc Earnings Call

Question: Reuben Garner - The Benchmark Company LLC - Analyst : Sorry, I was on mute. Yeah, that's helpful. And then, I guess, this pricing sounds like it's stable. Can you just talk about -- I know you're coming into the end of your fiscal year, but maybe talk about it on a go-forward basis the next kind of year? What's left in the pricing actions that you've already announced? When was the last pricing action you announced? Do you need another one this year to keep up with inflation? Are you seeing your competitors announce them? I guess just kind of an update on price cost in this environment?

Question: Reuben Garner - The Benchmark Company LLC - Analyst : And then, I guess last question, you kind of answered the share question. I think that was directed at the Americas side. My question is actually, internationally, the business seems to be holding up a little better. And in fact, it looks like the last quarter showing growth again. How much of that would you attribute to kind of maybe the benefits that there were between Knoll and Miller versus -- have you seen a stabilization in macro over there kind of quicker? I know it's been a volatile situation, but just kind of thoughts on how things have transpired over the last six to nine months? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 27, 2024 / 9:00PM, MLKN.OQ - Q3 2024 MillerKnoll Inc Earnings Call

Question: Reuben Garner - The Benchmark Company LLC - Analyst : And guys, I said I think I said last one, but I'm going to sneak one more in, if that's all right. Jeff, can you just -- maybe you said this, but just to restate it if you could. The order patterns that you saw throughout the quarter, can you walk through those again? What kind of December, January, February look like? And then were those specific to -- were those consolidated or did you break out Americas? And if you didn't, could you talk

Question: Reuben Garner - The Benchmark Company LLC - Analyst : Okay. Thanks for the detail, guys. I'll pass it on.