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Steelcase Reports Second Quarter Results

The Steelcase Inc. logo is available at  http://www.globenewswire.com/newsroom/prs/?pkgid=7606    

STEELCASE INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in millions, except per share data)
         
  Three Months Ended Six Months Ended
  August 24, August 26, August 24, August 26,
  2012 2011 2012 2011
Revenue  $ 744.9  $ 700.5  $ 1,420.1  $ 1,339.9
Cost of sales  513.4  487.9  987.5  934.2
Restructuring costs  3.4  11.4  8.5  21.4
Gross profit  228.1  201.2  424.1  384.3
Operating expenses  181.0  174.9  357.7  343.1
Restructuring costs  0.3  0.9  0.3  0.8
Operating income  46.8  25.4  66.1  40.4
Interest expense  (4.6)  (7.6)  (9.1)  (16.0)
Investment income (loss)  1.3  (2.6)  2.4  0.3
Other income, net  1.7  --   5.5  2.0
Income before income tax expense  45.2  15.2  64.9  26.7
Income tax expense  15.7  3.3  22.2  7.3
Net income  $ 29.5  $ 11.9  $ 42.7  $ 19.4
         
Earnings per share:        
Basic  $ 0.23  $ 0.09  $ 0.33  $ 0.15
Diluted  $ 0.23  $ 0.09  $ 0.33  $ 0.14
Dividends declared and paid per common share  $ 0.09  $ 0.06  $ 0.18  $ 0.12
Weighted average shares outstanding - basic  127.1  133.2  127.9  133.6
Weighted average shares outstanding - diluted  127.7  133.6  128.4  134.0
 
 
STEELCASE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions)
     
  August 24, February 24,
  2012 2012
ASSETS
Current assets:    
Cash and cash equivalents  $ 103.2  $ 112.1
Short-term investments  52.2  79.1
Accounts receivable, net  333.4  271.4
Inventories  142.2  139.5
Deferred income taxes  55.5  42.4
Other current assets  49.1  57.6
Total current assets  735.6  702.1
     
Property, plant and equipment, net  341.8  346.9
Company-owned life insurance  232.1  227.6
Deferred income taxes  92.5  120.0 * 
Goodwill  179.8  176.6
Other intangible assets, net  17.7  18.8
Other assets  99.6  96.5
Total assets  $ 1,699.1  $ 1,688.5
     
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:    
Accounts payable  $ 225.9  $ 191.3
Short-term borrowings and current portion of long-term debt  4.1  2.6
Accrued expenses  253.8  268.1
Employee compensation  98.0  123.0
Employee benefit plan obligations  19.3  22.6
Other  136.5  122.4
Total current liabilities  483.8  461.9
     
Long-term liabilities:    
Long-term debt less current maturities  287.8  288.9
Employee benefit plan obligations  159.6  161.1
Other long-term liabilities  79.6  80.5
Total long-term liabilities  527.0  530.5
Total liabilities  1,010.8  992.4
     
Shareholders' equity:    
Common stock  --   1.1
Additional paid-in capital  20.9  32.6
Accumulated other comprehensive income (loss)  (13.9)  0.8
Retained earnings  681.3  661.6 * 
Total shareholders' equity  688.3  696.1
Total liabilities and shareholders' equity  $ 1,699.1  $ 1,688.5
     
* The company has identified an error in its accounting for deferred income taxes which relates to periods prior to fiscal year 2010 and expects to restate its historical financial statements to correct the error.  Management believes the error is not material to any prior period financial statements.  The correction of the error has the effect of reducing long-term deferred income taxes and retained earnings and is currently estimated at $12.5 million.  The condensed consolidated balance sheet above has been restated to reflect this correction as currently estimated.  The error and correction will be further described in the company's Form 10-Q for the quarter ended August 24, 2012 to be filed with the Securities and Exchange Commission.
 
STEELCASE INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)
(in millions)
     
  Six Months Ended
  August 24, August 26,
  2012 2011
OPERATING ACTIVITIES    
Net income  $ 42.7  $ 19.4
Depreciation and amortization  27.4  27.6
Changes in cash surrender value of company-owned life insurance  (4.5)  0.9
Changes in deferred income taxes  11.8  (2.9)
Changes in operating assets and liabilities, net of acquisitions and divestiture:    
Accounts receivable, inventories and accounts payable  (33.7)  (22.4)
Employee compensation liabilities  (26.3)  (38.1)
Other assets and liabilities  (2.1)  (20.8)
Other  13.9  33.2
Net cash provided by (used in) operating activities  29.2  (3.1)
     
INVESTING ACTIVITIES    
Capital expenditures  (25.8)  (29.0)
Proceeds from disposal of fixed assets  14.1  0.4
Purchases of short-term investments  (14.3)  (158.2)
Liquidations of short-term investments  41.7  456.4
Acquisition  (4.9)  (18.7)
Other  (6.0)  7.8
Net cash provided by investing activities  4.8  258.7
     
FINANCING ACTIVITIES    
Repayments of long-term debt  (1.5)  (253.2)
Dividends paid  (23.0)  (16.0)
Common stock repurchases  (19.4)  (23.1)
Other  1.9  (1.2)
Net cash used in financing activities  (42.0)  (293.5)
     
Effect of exchange rate changes on cash and cash equivalents  (0.9)  0.1
     
Net decrease in cash and cash equivalents  (8.9)  (37.8)
Cash and cash equivalents, beginning of period  112.1  142.2
Cash and cash equivalents, end of period  $ 103.2  $ 104.4
CONTACT: Investor Contact:
         Raj Mehan
         Investor Relations
         (616) 246-4251

         Media Contact:
         Lauren Begley
         Public Relations
         (212) 931-6143

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