Steelcase Inc. (NYSE:SCS) Q4 2023 Earnings Call Transcript

Greg Burns: Okay. And obviously there’s been some consolidation going on in the industry. What are your thoughts on amplifying some of these organic investments with M&A, and do you feel there’s any areas where you might benefit from like kind of a scale acquisition?

Sara Armbruster: Well, I think we are always, as we’ve said previously, thinking about both organic and inorganic opportunities to invest in the business. We remain pretty active in keeping our eyes open and asking those questions in terms of what might make sense for our strategy and what might be the right next moves. So I would say we continue to ask those questions as we always do and we continue to look at opportunities to drive our strategy forward.

Greg Burns: Okay. Lastly with the conversations you’re having around some of the projects, now that we’ve gone through COVID, companies are trying to understand what their offices are going to look at — look like post-COVID, do you feel like the expectations for what an office is going to look like, have changed drastically, do you have the product portfolio to kind of address where the office is headed or do you feel like you need to maybe fill in any gaps and where everything is evolving toward?

Sara Armbruster: Yeah, so I feel really good about where we’re positioned. I mean, you’ll recall that over the past couple of years during the pandemic, we made the explicit choice to remain committed to the office, so we stayed invested in product development. We did a ton of research to better understand the very question you’re asking throughout the pandemic. We made moves like the acquisition of Halcon to help support what we felt was going to be the portfolio that we would need to be successful. And in terms of what we’re seeing right now, I wish Eddy Schmitt, our Head of Americas, were here right now, but he’s not because he’s actually out there calling on large companies and he was recently out on the East Coast. He was in the West Coast last week.

He’s in Europe this week and it’s been interesting to hear him reflect on the energy, I would say, that many of these organizations are bringing to their spaces and really thinking about what’s next and what’s required for them to be successful. And two key things for sure among several that have come out of those recent conversations are the continued desire to create more privacy and options for privacy for individuals within the workplace, and then also investment in really terrific social spaces. So having more informal collaboration social kind of spaces that are a draw for people to come back to the office as well as creating the opportunity for people to come together in different kinds of ways within in office and I think on both those fronts, privacy and social spaces, we’ve done a lot of work over the past couple of years, both through acquisitions and our own product development, as well as the partnerships we’ve developed to give us a I think a pretty competitive portfolio to allow us to be successful.

Greg Burns: Great, thank you.

David Sylvester: Thanks, Greg.

Operator: Your next question comes from the line of Steven Ramsey with Thompson Research Group. Please go ahead.

Steven Ramsey: Hi, good morning. On the backlog and order decline that context for the fourth quarter, March better, but lower corporate volumes being the driver, are volumes better through that time period in the education, SMB and health markets and do you expect non-corporate verticals to have better volumes throughout the year?