Office furniture maker HNI Corp. reported higher earnings on Monday despite facing demand and trade challenges.
Muscatine-based HNI announced earnings of $93 million, or $2.11 per share, for the full year which ended Dec. 29, 2018. That compares to $2 per share in the prior year.
For the fourth quarter, sales increased 2.4 percent to $598 million. Earnings were $32 million, or 73 cents per share, compared to 77 cents one year ago. The net impact of closing and divesting small office furniture companies decreased sales $17.1 million compared to the prior year quarter, according to the report.
"Our teams performed well in the fourth quarter — delivering significant earnings growth and margin expansion," said Jeff Lorenger, president and CEO, in a news release. "We are managing through multiple challenges, including continued inflationary pressures, tariff impacts and choppy demand. Our organization is responding well, and I am optimistic about what we can accomplish in the future."
For the year, hearth product sales increased 7.1 percent from the previous year to $551.8 million, driven by increases in the new construction and retail businesses. Full-year office furniture sales increased 2.7 percent.
Company officials expect 2019 sales to rise 3 to 7 percent, with earnings per share to be between $2.50 and $2.90.
"Looking to 2019, we see a dynamic environment with pockets of uncertainty," Lorenger said. "Late in the fourth quarter and early this year, market activity generally slowed. We expect demand will start slowly and improve throughout 2019. We continue to see pressure from inflation and tariff impacts. Despite these pressures, we expect to grow profits through productivity and cost saving efforts while continuing to invest in new capabilities. I remain excited about our members, opportunities and market position."
For the first quarter of the year, HNI officials expect sales to be down 2 to 4 percent compared to the same quarter last year.