MillerKnoll, Inc.

Good evening and welcome to Miller-Knowles Quarterly Earnings Conference Call. As a reminder, this call is being recorded. I would now like to introduce your host for today's conference, Chief Financial Officer Jeff Stutz. Please go ahead.

Thank you. Good evening and welcome to our fourth quarter fiscal 2024 conference call. I'm joined by Andy Owen, Chief Executive Officer. Also available during the Q&A session are John Michael, President of America's Contract and Debbie Probst, President of Global Retail. Before I turn the call over to Andy, please remember our safe harbor regarding forward-looking information. During the call, management may discuss information that is forward-looking and involves known and unknown risks, uncertainties, and other factors that may cause the actual results to be different than those expressed or implied. Please evaluate the forward-looking information in the context of these factors, which are detailed in today's press release. The forward-looking statements are as of today, and we assume no obligation to update or supplement these statements. We may also refer to certain non-GAAP financial metrics, which are reconciled and described in our press release posted on our investor relations website at millernewell.com. And with that, it's my pleasure to turn the call over to Andy.

Thanks, Jeff, and thanks, everyone, for joining us tonight. Miller-Noel wrapped up fiscal year 2024 with a strong finish. Throughout the year, we anticipated business improvement in the back half, and we shared the actions we took to align our operating costs with the economic environment, to boost demand across contract and retail, and to future-proof our business. I'm proud to report that by leveraging the scale of our collective of brands and our diversified business channels and global operations, our teams delivered significant earnings per share and margin growth in the fourth quarter. In addition, we delivered consolidated organic order growth of 2.9% for the quarter. Right now, the demand environment for contract and key markets are heading in a positive direction, and we've put ourselves in a strong position to benefit from this shift. We've adjusted our business to remain agile and productive, and we see healthy levels of activity across our business as a result. We're optimistic that a strong quarter and an improving market will contribute to our momentum for the upcoming year. I'd like to share a few highlights about the work underway, and then Jeff will provide a closer look at our financials and our outlook. We kicked off fiscal year 2025 with several events around the globe this month, including Design Days in Neocon in Chicago and Three Days of Design in Copenhagen. At our Fulton Market Chicago showrooms, design enthusiasts were thrilled to experience our second nature sustainability and test lab exhibits. Both immersive experiences underscored our design DNA, our commitment to sustainability, and the rigorous process that we put our products through to ensure both innovation and quality are always present. In Copenhagen, our flagship Hay House was packed with customers shopping new collaborations, including a fun partnership with Japanese sportswear brand Nasix. And we hosted several events at Muto's showroom, showcasing the brand's approach to creating intentional spaces, both indoors and outdoors. Traffic at Neocon is back, close to pre-COVID levels. and appointments at our showrooms during design days were up year over year. More importantly, conversations with customers have shifted. They've moved from theoretical return-to-office ideas to specific project needs, and with that, we believe there is opportunity. We're well-positioned through our Design with Impact programs to solve these needs. In the year ahead, we'll invest in Miller & Noll showrooms, digital platforms, and enhanced tools to fuel our contract business and support our Miller & Noll dealers. We're finding new ways to bring our collective of brands together in both our dealer showrooms and our own showrooms. This fall, we'll open newly enhanced Miller Knoll spaces in London, New York, and Los Angeles that spotlight our leadership in design and sustainability. We're also ramping up product launches to deliver unique solutions for our customers. This month, we launched over 30 new products at Design Day, capturing industry awards for Knoll's Tugendhat and Morris & Hannah chairs, Knoll's Close Collection for private offices, and Not One's Percy chairs. In addition, Herman Miller refreshed the versatile phantom gaming chair with ergonomic enhancements and showcased the new Miratou task chair with a lower carbon footprint. And at Three Days of Design, Muto introduced a new outdoor collection, Settle, and Hay introduced new ancillary seating, bar stools, coffee tables, cabinets, and lighting. Our international contract business is a growth vehicle, and we continue transitioning legacy Herman Miller and Knoll dealers to full Miller and Knoll dealers. This quarter, we transitioned 19 dealers in 17 countries and 19 cities. In addition, as we look at the full year, we added 29 new dealers in three countries and 13 new cities to expand our international distribution footprint. With close to 150 international millennial dealers onboarded, we've closed out the fiscal year ahead of schedule, allowing us to be even more responsive and align with our customers and clients. Through our dealer showrooms, we're expanding our physical presence in high-performing regions, This quarter, dealers opened new millennial showrooms in India, Singapore, and Indonesia. Turning to retail, we delivered organic order growth of 1% year-over-year, despite the tough macroeconomic conditions our industry still faces. We're continuing to do the work to drive orders in the short term while optimizing our retail engine for significant long-term sales growth. We maintain a strong focus on inventory management. and optimizing our product assortment by continuing to expand our complimentary assortment. And to capture more sales and productivity with less book traffic, we're densifying our store space to show more of our collections. We saw huge margin improvements due to these efforts. Our adjusted gross margin in our retail business were up 640 basis points on a year-over-year basis. We also continue to provide tools that help our retail customers build beautiful spaces and drive larger orders with fewer returns. New configurator tools on-site and design services make it easier and more rewarding to place orders at Design Within Reach and Herman Miller stores. As we look to the future, we will invest in new stores, applying the format and experiences we've tested at our newest Design Within Reach stores, such as San Francisco. In addition, negative trends in home sales are beginning to ease a bit. The National Association of Realtors reported that year-over-year declines in existing home sales are beginning to flatten. We believe there is pent-up retail demand, and we are prepared to harness it. Finally, sustainability, along with innovation, is an important consideration for our customers and associates around the globe. Our work builds on a legacy of sustainable design and business practices that we have nurtured for decades. Today, it extends across our collective and encompasses hundreds of projects, big and small. As I mentioned, we showcase our sustainability efforts through an exhibit at Design Days in Chicago. We shared many of the things we're acting on. Now, from incorporating more bio-based materials in our products, like eel grass, to using more recycled content and embracing circular design. During the quarter, we were also recognized for our efforts for gold medal rating from EcoVedas, putting us in the top 5% of companies rated by EcoVedas in the past 12 months. We also received the 2024 Steele Sustainable Innovation Award for our work leveraging ocean-bound plastics to reduce waste and single-use plastics. All of this to say, we're optimistic and focused on growth in the year ahead. With that, I will turn it back to Jeff for a closer look at our financial.