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HERMAN MILLER, INC., REPORTS NET SALES AND NET INCOME FOR THE SECOND QUARTER OF FISCAL 1993

 ZEELAND, Mich., Dec. 28 /PRNewswire/ -- Herman Miller, Inc. (NASDAQ-NMS: MLHR), today reported the following results for the second quarter ended Nov. 28, 1992.
 Net sales decreased .5 percent and net income decreased 33.5 percent for the three months ended Nov. 28, 1992, over the second-quarter results a year ago. During the three months ended Nov. 28, 1992, the company had net sales of $205.0 million and net income of $3.6 million, equal to $.14 per share, compared with net sales of $206.1 million and net income of $5.3 million, or $.21 per share, in the three months ended Nov. 30, 1991.
 Net sales of foreign operations and export sales from the United States in the second quarter ended Nov. 28, 1992, totaled $30.8 million compared with $31.4 million last year, resulting in a net loss of $1.3 million compared with a net loss of $.6 million last year.
 Net sales of $404.6 million and net income of $6.0 million, equal to $.24 per share, were recorded for the first six months, compared with net sales of $390.7 million and a net loss of $.4 million, or $.01 per share, in the first half last year.
 The first-quarter results of fiscal 1992 included the cumulative effect of a change in accounting principle resulting from the fourth- quarter adoption of Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions" (SFAS No. 106). The cumulative effect of SFAS No. 106 reduced previously reported net income by $8.0 million, or $.31 per share, for the first quarter of fiscal 1992. The adoption of SFAS No. 106 also resulted in a further restatement of previously reported interim results which reduced earnings per share for each fiscal 1992 quarter by $.01. Accordingly, first six months of 1992 net income was $7.6 million, or $.30 per share, before giving effect to the adoption of SFAS No. 106.
 Net sales of foreign operations and export sales from the United States for the first six months ended Nov. 28, 1992, totaled $63.1 million compared with $59.5 million last year, resulting in a net loss of $4.1 million compared with a net loss of $1.6 million last year.
 The backlog of unfilled orders at Nov. 28, 1992, was $140.4 million compared with $132.3 million a year earlier and $118.6 million, at Aug. 29, 1992. The ending second-quarter backlog represents the highest backlog level in two years, an increase of $8.1 million, or 6.1 percent, over the year-earlier level and an increase of $21.8 million, or 18.4 percent, over the ending backlog for the first quarter of fiscal 1993.
 New orders received in the second quarter increased $16.8 million, or 8.0 percent, when compared to the same period a year ago and $24.7 million, or 12.2 percent, over the level recorded in the first quarter. New orders for the first six months increased $17.9 million, or 4.3 percent, when compared to the first six months of fiscal 1992.
 James H. Bloem, vice president and chief financial officer, said, "We were pleased with the rate of our second-quarter incoming orders, which have continued into December. While incremental profitability on these new orders is significantly less than year-earlier levels, an increased amount of implemented cost savings, reduced operating expenses, and lower interest charges have moderated the effects of increased price discounts worldwide. As a result, we expect operating profitability in the second half of the year to exceed the profitability achieved in the first half of the year. Reduced operating expenses and lower interest charges each contributed $.02 per share to our second- quarter results.
 "Our international results were adversely affected by sharply lower volume in both Canada and Australia, where sales were 50 and 45 percent lower, respectively, than in the second quarter of 1992. In contrast to previous quarters, European sales and orders improved, especially in the United Kingdom where a small profit was recorded. However, Continental European business remains soft and sluggish, reflecting a continued weakening of the Western European economies.
 "Despite the fact that our earnings, while improved over first quarter, have not returned to acceptable levels, the following milestones achieved during the second quarter and first half of the year demonstrate further progress in improving our operating competitiveness and financial strength.
 "1. Second-quarter cash flow from operating activities totaled $23.1 million compared with net income of $3.6 million. Cash flow from operating activities for the first six months totaled $38.9 million while net income was $6.0 million.
 "2. The sum of days sales in accounts receivable plus days sales in inventory declined 13 days to 88.1 days during the past 12 months. During the past six months, net working capital has declined $19.8 million.
 "3. Strong cash flow has enabled us to maintain (compared with the first half of fiscal 1992) our capital expenditure level of approximately $17 million for the first six months while increasing our research and development expenditures by approximately $1.4 million during the same period. Research and development expenditures totaled 2.9 percent of net sales for the first six months, more than twice the industry average. Maintenance of our capital expenditure level and an increase in research and development outlays enable us to reduce our unit product costs in response to lower unit pricing while also continuing to develop products with a superior price-value relationship.
 "4. Interest-bearing debt declined $5.1 million during the second quarter, and $4.0 million during the first six months, to $49.9 million. In the last 3.5 years, $90.3 million in interest-bearing debt has been retired. This has reduced our pretax interest expense for the first six months by $2.5 million, or $.06 per share. Our long-term debt-to-total capital ratio now stands at 7.5 percent vs. 9.5 percent at the end of fiscal 1992 and 26.0 percent at the end of fiscal 1989.
 "5. During the past 12 months, total assets declined to $462.7 million, or 2.4 percent, while sales declined only .5 percent over year-ago levels. Total assets are now at the same level as in fiscal 1988 when they supported annual net sales of nearly $80 million less than net sales in the past 12 months. This continually improving asset utilization is critical to our long-term competitiveness. We believe we continue to have among the best net sales-to-average total assets and net sales-per-employee ratios in our industry.
 "6. During the first six months, we have maintained our $.13 quarterly dividend in the face of significantly lower earnings. In addition, in the second quarter we repurchased .489 million shares, or 1.9 percent, of our outstanding common stock at an average cost of $15.31 per share. The second-quarter trading range was $14.75 to $17.00 per share. During the first six months, we repurchased .529 million shares at an average cost of $15.43 per share. The trading range during the first half of fiscal 1993 was $14.75 to $19.50 per share. We remain committed to our 2.0 million share repurchase program announced in January 1991. Since that date, 1.344 million shares have been repurchased at an average cost of $17.07 per share. The trading range between Jan. 1, 1991, and Nov. 28, 1992, was $14.75 to $22.50 per share. All share repurchases have been made on the open market on an unsolicited basis. Thus, during the first six months of fiscal 1993, $14.7 million has been returned to our shareholders in the combined form of cash dividends and share repurchases.
 "The cash generated to fund these achievements is directly attributable to the continuing proficiency of our employee-owners in flexing asset levels to meet customer needs while garnering new orders. This ability gives us confidence that we can further progress in the continuing uncertain environment worldwide."
 Herman Miller, Inc. is an international firm engaged primarily in the manufacturing and sale of office systems products and related services principally for offices and, to a lesser extent, for health- care facilities and other uses. The company's common stock is traded on the National Market System for over-the-counter stock issues (NASDAQ symbol: MLHR).
 HERMAN MILLER, INC.
 CONDENSED CONSOLIDATED STATEMENTS
 (Unaudited; dollars in 000s, except per-share data)
 Six Months Ended
 Nov. 28, Nov. 30,
 1992 1991
 Net Sales $404,570 $390,724
 Income Before Taxes and Cumulative Effect
 of Change in Accounting Principle
 (SFAS No. 106) 10,767 12,367
 Taxes on Income 4,800 4,800
 Net Income Before Cumulative Effect 5,967 7,567
 Cumulative Effect of Change in Accounting
 Principle, Net of Applicable Income Taxes --- (7,976)
 Net Income (Loss) $5,967 ($409)
 Earnings Per Share
 Before Cumulative Effect $.24 $.30
 Cumulative Per Share Effect of Change
 in Accounting Principle --- (.31)
 Net Income (Loss) Per Share $.24 ($.01)
 Common Share Equivalents 25,061,137 25,205,795
 Three Months Ended
 Nov. 28, Nov. 30,
 1992 1991
 Net Sales $204,974 $206,090
 Income before Taxes 6,058 8,798
 Taxes on Income 2,500 3,450
 Net Income $3,558 $5,348
 Earnings per Share $.14 $.21
 Common Share Equivalents 24,931,201 25,079,617
 HERMAN MILLER, INC.
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (Dollars in 000s)
 Nov. 28, May 30,
 1992 1992
 (unaudited)
 Assets
 Current assets
 Cash and short-term investments $16,131 $16,949
 Accounts receivable (net) 109,367 109,770
 Inventories 58,631 59,861
 Prepaid expenses 12,095 18,739
 Totals 196,224 205,319
 Net property and equipment 219,317 220,317
 Other assets 47,160 45,632
 Totals $462,701 $471,268
 Liabilities and Shareholders' Equity
 Current liabilities
 Current long-term debt $1,372 $2,756
 Notes payable 26,754 21,774
 Accounts payable 34,327 36,945
 Accrued liabilities 86,984 77,299
 Totals 149,437 138,774
 Long-term debt 21,813 29,445
 Deferred items 23,163 22,967
 Shareholders' equity 268,288 280,082
 Totals $462,701 $471,268
 HERMAN MILLER, INC.
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited; dollars in 000s)
 Six Months Ended
 Nov. 28, Nov. 30,
 1992 1991
 Net Income (Loss) $5,967 ($409)
 Cash Flows from Operating Activities 38,924 39,305
 Cash Flows used for Investing Activities (21,935) (18,329)
 Cash Flows used for Financing Activities (16,896) (28,506)
 Effect of Exchange Rates (911) (254)
 Net Increase in Cash (818) (7,784)
 Cash, Beginning of Year 16,949 15,369
 Cash, End of Period $16,131 $7,585
 -0- 12/28/92
 /CONTACT: Jim Bloem, 616-654-3653, or Jim Schreiber, 616-654-8923, both of Herman Miller, Inc./
 (MLHR)


CO: Herman Miller, Inc. ST: Michigan IN: SU: ERN

SM -- DE015 -- 0166 12/28/92 17:05 EST
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