INVESTOR PRESENTATION First Quarter, FY2019
WHO WE ARE Steelcase is the world s leading provider of office furniture
We believe we are positioned to grow in a changing market Our scale and track record of performance presents distinct, significant advantages. MARKET LEADER REVENUE & EBITDA GROWTH STRONG SHAREHOLDER RETURN 3
MARKET LEADER We are a respected leader Greatest global market share $3.1 billion revenue in FY2018 11,000+ employees 800+ Steelcase dealer locations Recognized for innovative design, sustainability leadership and civic engagement A Fortune World s Most Admired Company for eleven years Multinational Finalist in the Circulars Awards presented by World Economic Forum for circular economy leadership UN Global Compact participant since 2009 Brody WorkLounge received nine design and innovation awards, including a Silver Award in the multi-industry Edison Awards 4
MARKET LEADER Our global capability makes us a preferred partner for leading organizations GLOBAL OFFICE FURNITURE MARKET REVENUE* ($ in billions) STEELCASE REVENUE MIX BY SEGMENT (Trailing four-quarters TFQ ) $3.5 $3.0 $2.5 Outside Home Country Home Country EMEA 18% $2.0 $1.5 $1.0 Americas 71% Other Category 11% $0.5 $0.0 Steelcase Herman Miller Haworth HNI** Knoll Kokuyo** Okamura** *Most recently published annual data and/or internal estimates **Only office furniture segments included 5
MARKET LEADER We employ user-based research to drive innovation CREATE A ROBUST RESEARCH NETWORK DEVELOP INSIGHTS ON WORK, WORKERS AND THE WORKPLACE PROVIDE PRODUCTS, STRATEGIES AND CUSTOMER SOLUTIONS Select Research Partners IDEO Mayo Clinic CFI Oakridge National Lab Georgia Tech Manufacturing Institute Santa Fe Institute MIT Media Lab Intel Research University of Michigan Stanford University Harvard Graduate School of Education University of Delft Fraunhofer Institute Argonne National Laboratory University of Wisconsin-Madison SIX-STEP RESEARCH AND DESIGN PROCESS Steelcase solutions are based on a human-centered design approach that includes extensive observation and consultation with people who use spaces every day. 6
MARKET LEADER We serve leading organizations to create places that amplify the performance of people, teams and enterprise CORPORATE EDUCATION HEALTHCARE OFFICE CONSTRUCTION SPENDING EDUCATION CONSTRUCTION SPENDING HEALTHCARE CONSTRUCTION SPENDING 56 67 69 +5% +3% 85 89 91 +4% +5% 39 39 40 +4% +4% 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Sources: U.S. Census Bureau (in US $,billions) American Institute of Architects forecast 7
WHY INVEST IN US Steelcase is poised for growth
REVENUE & EBITDA GROWTH We see opportunities for strong revenue growth as our core market faces major forces of change FORCES OF CHANGE RESULTING IN DIFFERENT APPLICATIONS Global teams Mobile technologies Past Present Future Collaborative nature of work Real estate compression Generational preferences Mix private offices, cubicles open, shared work areas Historically, a significant amount of office space was based on private offices and cubicles in the future, we expect the mix of open environments to increase. 9
REVENUE & EBITDA GROWTH Space is more important that ever as the war for talent increases and companies seek increased employee engagement U.S. LABOR FORCE EMPLOYEE ENGAGEMENT 23% 13% Nearing retirement Retirement New Recent entrants Entrants 11% Source: U.S. Bureau of Labor Statistics 2017 projections Nearing retirement - percentage of workforce age 55+ Recent entrants - percentage of workforce age 16-24 Source: 2016 Steelcase Global Report 10
REVENUE & EBITDA GROWTH Our growth historically has been achieved through gross margin improvements in the Americas, and more recently we re making progress in EMEA 70% 60% 50% 40% 30% 20% 10% 2.0 1.4 1.5 Americas Adjusted Gross Margin% * Reported Revenue ($B) 1.8 2.0 2.2 2.2 2.3 2.2 2.2 28% 29% 29% 30% 31% 33% 33% 35% 35% 34% 2.5 2.0 1.5 1.0 0.5 70% 60% 50% 40% 30% 20% 10% 756 530 547 EMEA Adjusted Gross Margin% Reported Revenue ($M) 611 595 567 32% 29% 29% 29% 27% 24% 595 521 504 524 22% 20% 26% 27% 800 700 600 500 400 300 200 100 0% FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18-0% FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 - * Gross margin restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. Constant Currency MANUFACTURING CONSOLIDATION THIRD-PARTY SOURCING 20 18 Million square feet, MSF* 16 12 8 4 10 6 0 FY00 FY08 FY18 Past FY00 Present FY17 11
REVENUE & EBITDA GROWTH We are making progress in EMEA and much is in place that is expected to drive additional improvements EMEA GROSS MARGIN TARGET WHAT WE ARE SEEING: Improved economic and political sentiment in France and Germany 26% 27% Cost reductions/ other initiatives Pricing Volume Low-to-Mid 30% range Stability in our operating performance Improvement in our pipeline of project activity compared to the prior year Continued benefits from cost reduction initiatives FY17 FY18 Future target Munich LINC Learning + Innovation Center Customer traffic at our new Learning + Innovation Center in Munich 12
REVENUE & EBITDA GROWTH We are increasing our focus towards growth to capture these opportunities as our industry changes PAST 10+ YEARS PRESENT growth initiatives growth initiatives business model optimization business model optimization 13
REVENUE & EBITDA GROWTH We are taking actions to capitalize on the opportunities In FY18 and FY19, we have been focused on growth in tangible ways: Launched more new and enhanced products in FY18 than we had in any of the previous 5 years Simpler workstations Broader price points Residential design Innovative offerings Established partnerships with other companies to leverage our scale Acquired AMQ Solutions and intend to acquire Smith Systems while continuing to explore other potential acquisitions that advance our strategies Helping customers create a smart + connected workplace by offering a range of new technology solutions 14
REVENUE & EBITDA GROWTH Our investment in new and enhanced products has accelerated, and we have launched new product offerings that expand our addressable market SIMPLER WORKSTATIONS BROADER PRICE POINT RESIDENTIAL DESIGN INNOVATIVE OFFERINGS 15
REVENUE & EBITDA GROWTH We are establishing partnerships with other companies to increase the breadth of our product offering 16
REVENUE & EBITDA GROWTH Pending acquisition of Smith Systems is intended to advance our strategy to offer a broad range of innovative solutions in the education market Acquisition expected to be completed in Q2 FY19 Manufacturer of high quality furniture for the prek-12 education market Purchase of stock for ~$140 million plus an adjustment for working capital Expected to be modestly accretive in FY19 and more significantly thereafter Recorded compounded annual growth of 25% over past three years, to ~$82 million in revenue over past 12 months 17
REVENUE & EBITDA GROWTH Acquired AMQ Solutions to advance our strategy to provide a broader range of price points to customers Acquisition completed in December 2017 Provider of height adjustable desking, benching and seating for workstations in the open plan, collaborative environments and training rooms Paid ~$70 million to acquire all outstanding membership interests of AMQ and certain assets of an affiliated company. At time of acquisition, trailing 12-month revenue was ~$37 million 18
REVENUE & EBITDA GROWTH Our smart + connected initiatives are expected to provide new opportunities with existing customers Steelcase is creating smart and connected workplaces for customers, using technology to fuel engagement and improve organizational performance. WORKPLACE ADVISOR STEELCASE FIND APP CREATIVE SPACES A cloud-enabled system that utilizes occupancy data and transforms it into actionable insights for a more effective workplace. The Find app quickly empowers you to locate and reserve the best place to meet or work, on demand. Together with Microsoft, Steelcase is creating an immersive ecosystem that brings together place and technology to help people generate new ideas and move them forward. 19
REVENUE & EBITDA GROWTH Our Asia Pacific performance is the result of a successful growth initiative and is indicative of our global strength Investments in China and India have driven the growth in Asia-Pacific, which is the largest portion of the Other category. OTHER CATEGORY Revenue ($ millions) $340 Revenue Adj. OI % Adjusted Operating Income * (% of revenue) 7% $320 6% $300 5% $280 4% $260 3% $240 2% $220 1% $200 FY13 FY14 FY15 FY16 FY17 FY18 0% * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 20
REVENUE & EBITDA GROWTH Traditional market drivers of demand are strong 15% 10% 5% 0% -5% -10% -15% CORPORATE PROFITS AFTER-TAX (U.S.) With IVA and CCA adjustments (Year-over-Year % change) Q1 2014 Q1 2018 JOB GROWTH & UNEMPLOYMENT (U.S.) Total non-farm jobs (in thousands) 1000 900 800 700 600 500 400 300 200 100 0 Q1 2014 Unemployment Rate (%) Non-farm Payroll Growth 8% Unemployment rate 7% 6% 5% 4% 3% 2% 1% 0% Q1 2018 80 70 60 50 40 30 20 10 THE CONFERENCE BOARD MEASURE OF CEO CONFIDENCE (U.S.) 0 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 ARCHITECTURAL BILLING INDEX (U.S.) (Billings $ billions) 60 50 40 Jan 2014 Sources: BEA, BLS, CEO Conference Board, AIA, BIFMA and CSIL Mar 2018 $1,200 $1,000 $800 $600 NON-RESIDENTIAL FIXED INVESTMENT (U.S.) Equipment (In US$, billions) Q1 2014 Q1 2018 TOTAL U.S. (COMBINED) BIFMA MARKET SIZE (In US$, billions) $20 $15 $10 $5 $0 $9 $6 $3 $0 2013 2014 2015 2016 2017 2018 2019 2013 2014 2015 2016 Forecast EUROPE OFFICE FURNITURE CONSUMPTION (In US$, billions) Estimate Forecast 21
STRONG SHAREHOLDER RETURN We generate strong cash flows to fund growth investments and shareholder return MAINTAINING DISCIPLINED CASH MANAGEMENT Cash Flow From Operations and Adjusted EBITDA Margins ($ millions) $400 $300 $200 $100 $0 -$100 FY01 Cash Flow From Operations Adjusted EBITDA Margin TFQ 14% 12% 10% 8% 6% 4% 2% 0% Capital Expenditures vs. Depreciation and Amortization ($ millions) $300 $200 $100 $0 FY01 Capital Expenditures D&A $18 $14 $13 $10 $20 $26 Payments Included for Replacement Corporate Aircraft TFQ Quarterly Dividends Paid Per Share* Dividends* and Share Repurchases ($ millions) $0.16 $0.12 $0.08 $0.04 $300 $200 $100 Dividends Repurchases $0.00 Q1 FY01 Q1 FY19 $0 FY01 TFQ * Excludes special cash dividend of $1.75/share paid January 2008 22
STRONG SHAREHOLDER RETURN We have a proven record of managing well through economic cycles Adjusted Operating Income Margin * (% of revenue) 12% $4.0B Adjusted Operating Income % Revenue ($ Billion) $4.2 10% Revenue $3.4B $3.7 8% 8.0% $3.1B $3.2 6% 6.5% 5.1% $2.7 4% $2.3B $2.3B $2.2 $1.7 2% $1.2 0% $0.7-2% * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. $0.2-4% FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 -$0.3 23
STRONG SHAREHOLDER RETURN We have generated a greater than 10% return on invested capital over the last 5 years Adjusted Return on Invested Capital (ROIC) (% Adjusted Net Income of Average Capital) 16.0% Return on Invested Capital (ROIC) 14.0% 13.1% 13.8% 13.3% 12.3% 12.0% 10.9% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% FY14 FY15 FY16 FY17 FY18 24
STRONG SHAREHOLDER RETURN Our strong balance sheet provides flexibility through cycles Q1 FY19, $ MILLION PRIORITIES FOR CASH $1,200 $1,000 $800 $600 Equity Business reinvestment Acquisitions Dividends Share repurchases $400 Credit Facility $200 $0 COLI Cash Liquidity Profile Debt Capital Base 25
LEARN MORE Appendix
Forward looking statements From time to time, in written and oral statements, we discuss our expectations regarding future events and our plans and objectives for future operations. These forward-looking statements discuss goals, intentions and expectations as to future trends, plans, events, results of operations or financial condition, or state other information relating to us, based on current beliefs of management as well as assumptions made by, and information currently available to, us. Forward-looking statements generally are accompanied by words such as anticipate, believe, could, estimate, expect, forecast, intend, may, possible, potential, predict, project or other similar words, phrases or expressions. Although we believe these forward-looking statements are reasonable, they are based upon a number of assumptions concerning future conditions, any or all of which may ultimately prove to be inaccurate. Forward-looking statements involve a number of risks and uncertainties that could cause actual results to vary from our expectations because of factors such as, but not limited to, competitive and general economic conditions domestically and internationally; acts of terrorism, war, governmental action, natural disasters and other Force Majeure events; changes in the legal and regulatory environment; changes in raw materials and commodity costs; currency fluctuations; changes in customer demand; and the other risks and contingencies detailed in our most recent Annual Report on Form Q1 FY19 10-Q and our other filings with the Securities and Exchange Commission. We undertake no obligation to update, amend or clarify forward-looking statements, whether as a result of new information, future events or otherwise. 27
Segment revenue and earnings AMERICAS REVENUE (US$ millions) EMEA REVENUE (US$ millions) OTHER CATEGORY REVENUE (US$ millions) $2,154 $2,181 $2,256 $2,232 $2,194 $2,195 $567 $595 $521 $504 $524 $549 $268 $284 $283 $297 $338 $331 FY14 FY15 FY16 FY17 FY18 TFQ FY14 FY15 FY16 FY17 FY18 TFQ FY14 FY15 FY16 FY17 FY18 TFQ AMERICAS ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) EMEA ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) OTHER CATEGORY ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) 11.2% 11.1% 11.4% 10.8% 8.2% 7.7% 1.8% 1.7% 4.0% 4.7% 6.3% 4.1% FY14 FY15 FY16 FY17 FY18 TFQ 4.9% 5.7% 8.5% 3.7% 2.7% 1.3% FY14 FY15 FY16 FY17 FY18 TFQ FY14 FY15 FY16 FY17 FY18 TFQ * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 28
Select segment statistics AMERICAS EMEA OTHER CATEGORY Number of Steelcase dealer locations ~ 400 ~ 350 ~ 50 Employees non-manufacturing ~2,700 ~ 1,100 ~ 900 Employees manufacturing ~ 5,100 ~ 1,000 ~ 900 Number of primary manufacturing locations Michigan 2 Alabama 1 Mexico 2 France 1 Germany 1 Spain 1 Czech Republic 1 China 1 Malaysia 1 India 1 FY18 VERTICALS IN THE AMERICAS SEGMENT FY18 PRODUCT MIX FY18 LONG-TERM EMPLOYEE BENEFIT OBLIGATIONS FUNDING STATUS ($ millions) 24% Other Total Obligation $146 30% Seating Deferred Tax Asset Health Care Financial Services Education Manufacturing Insurance Services Information Technolo Technical/Profession Federal Government Energy State/Prov/Local Gov Other 46% Product Mix Systems/ Storage $172 Assets (COLI) $95 Liabilities After-tax Obligation * No vertical represented more than 13% of Americas revenue 29
Historical shares outstanding Shares (in millions) 180 160 140 120 Class A Shares Class B Shares 100 80 60 40 20 0 14.1 139.2 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Q1 FY19 86.3 30.4 30
Historical market data ESTIMATED U.S. OFFICE FURNITURE SHIPMENTS* (USD millions) $14 $12 $10 $8 $6 $4 $2 $0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 EUROPEAN OFFICE FURNITURE CONSUMPTION** (EUR millions) $14 $12 $10 $8 $6 $4 $2 $0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Sources: *1997-2015: BIFMA; 2015-2016: internal Steelcase estimates **CSIL 31
Non-GAAP financial measures This presentation contains certain non-gaap financial measures. A non-gaap financial measure is defined as a numerical measure of a company s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows of the company. Pursuant to the requirements of Regulation G, the company has provided a reconciliation of non-gaap financial measures to the most directly comparable GAAP financial measure. The non-gaap financial measures used within this presentation are: (1) adjusted operating income (loss) margin, which represents operating income (loss) margin, excluding restructuring costs and goodwill and intangible asset impairment charges, ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) (2) adjusted gross margin, which represents gross margin, excluding restructuring costs (benefits), (3) adjusted Earnings Before Interest Taxes and Depreciation and Amortization (EBITDA) Margin, which represents EBITDA, excluding restructuring costs and goodwill and intangible asset impairment charges, and (4) adjusted return on invested capital (ROIC), which represents income before income tax expense, excluding interest expense, restructuring costs and goodwill and intangible asset impairment charges, less income tax expense at an assumed long-term effective tax rate, divided by average capital (defined as the average of total debt and shareholders equity at the beginning and end of the applicable period). These measures are presented because management uses this information to monitor and evaluate financial results and trends. Therefore, management believes this information is also useful for investors. FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Operating Income (Loss) Margin as Restated * 8.0% 1.2% (2.3%) (2.6%) 1.1% 3.1% 3.8% 5.9% 0.1% (0.3%) 2.1% 3.4% 2.0% 5.4% 4.6% 5.5% 6.4% 5.1% Restructuring Costs - 1.7% 2.4% 2.3% 0.5% 1.3% 0.8% - 1.2% 1.5% 1.3% 1.1% 1.2% 0.2% 1.3% 0.7% 0.2% - Goodwill and intangible asset impairment charges - - - - - - 0.3% 0.6% 2.0% - - - 2.1% 0.4% - - - - Adjusted Operating Income (Loss) Margin 8.0% 2.8% 0.1% (0.3%) 1.6% 4.4% 4.9% 6.5% 3.3% 1.2% 3.4% 4.5% 5.3% 6.0% 5.9% 6.2% 6.6% 5.1% * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 32
Non-GAAP financial measures AMERICAS ADJUSTED GROSS MARGIN * (Percent of Revenue) FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Gross Margin as Restated * 26.4% 27.9% 28.7% 29.1% 30.5% 33.1% 33.8% 34.5% 34.6% 33.9% Restructuring Costs (Benefits) 1.2% 0.6% 0.4% 1.1% 0.7% - (0.5%) 0.1% 0.1% - Adjusted Gross Margin 27.6% 28.5% 29.1% 30.2% 31.2% 33.1% 33.3% 34.6% 34.7% 33.9% AMERICAS ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) FY14 FY15 FY16 FY17 FY18 TFQ Operating Income (Loss) Margin as Restated * 11.1% 11.6% 11.4% 10.7% 8.2% 7.7% Restructuring Costs (Benefits) 0.1% (0.5%) - 0.1% - - Goodwill and intangible asset impairment charges - - - - - - Adjusted Operating Income (Loss) Margin 11.2% 11.1% 11.4% 10.8% 8.2% 7.7% * Operating income and Gross Margin restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 33
Non-GAAP financial measures EMEA ADJUSTED GROSS MARGIN (Percent of Revenue) FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Gross Margin as Reported 32.0% 27.0% 25.2% 28.3% 26.8% 24.8% 13.9% 17.9% 26.1% 27.1% Restructuring Costs (Benefits) - 1.9% 3.4% 0.8% 0.2% (0.6%) 8.0% 2.1% 0.3% - Adjusted Gross Margin 32.0% 28.9% 28.6% 29.1% 27.0% 24.2% 21.9% 20.0% 26.4% 27.1% EMEA ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) FY14 FY15 FY16 FY17 FY18 TFQ Operating Income (Loss) Margin as Restated * (5.7%) (14.2%) (12.4%) (4.1%) (2.7%) (1.3%) Restructuring Costs 0.8% 8.5% 3.9% 0.4% - - Goodwill and intangible asset impairment charges - - - - - - Adjusted Operating Income (Loss) Margin (4.9%) (5.7%) (8.5%) (3.7%) (2.7%) (1.3%) * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 34
Non-GAAP financial measures OTHER CATEGORY ADJUSTED OPERATING INCOME MARGIN * (Percent of Revenue) FY13 FY14 FY15 FY16 FY17 FY18 TFQ Operating Income (Loss) Margin as Restated * (7.7%) (3.1%) 1.7% 4.0% 4.7% 6.3% 4.1% Restructuring Costs 0.4% 0.1% - - - - - Goodwill and intangible asset impairment charges 9.6% 4.8% - - - - - Adjusted Operating Income (Loss) Margin 2.3% 1.8% 1.7% 4.0% 4.7% 6.3% 4.1% * Operating income restated due to implementation of ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715). Please see Q1 FY19 10-Q for more information. 35
Non-GAAP financial measures ADJUSTED EBITDA MARGIN $ Million FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 TFQ Revenue $3,989 $3,038 $2,530 $2,346 $2,614 $2,869 $3,097 $3,421 $3,184 $2,292 $2,437 $2,750 $2,869 $2,989 $3,060 $3,060 $3,032 $3,055 $3,074 Income before income tax expense $301 ($5) ($67) ($93) $5 $76 $125 $211 ($9) ($31) $51 $82 $55 $147 $137 $175 $196 $162 $156 Interest Expense $18 $21 $21 $19 $21 $18 $19 $17 $17 $18 $19 $26 $18 $18 $18 $18 $17 $18 $18 Depreciation and amortization $163 $172 $157 $141 $128 $119 $101 $92 $87 $74 $64 $56 $58 $60 $60 $66 $60 $66 $68 Restructuring costs - $50 $61 $54 $13 $39 $24 - $38 $35 $31 $31 $35 $7 $41 $20 $5 - - Goodwill and intangible asset impairment charges - - - - - - $11 $21 $65 - - $4 $60 $13 - - - - - Adjusted EBITDA $482 $238 $173 $121 $167 $253 $279 $341 $199 $96 $166 $199 $226 $245 $256 $278 $279 $245 $242 Adjusted EBITDA Margin (% of Revenue) 12.1% 7.8% 6.8% 5.1% 6.4% 8.8% 9.0% 10.0% 6.2% 4.2% 6.8% 7.2% 7.9% 8.2% 8.4% 9.1% 9.2% 8.0% 7.9% 36
Non-GAAP financial measures ADJUSTED RETURN ON INVESTED CAPITAL (ROIC) $ Million FY14 FY15 FY16 FY17 FY18 Income before income tax expense $147 $137 $175 $196 $162 Interest Expense $18 $18 $18 $17 $18 Restructuring costs $7 $41 $20 $5 - Goodwill and intangible asset impairment charges $13 - - - - Adjusted Income before income tax expense $185 $196 $213 $218 $180 Assumed Long-Term Effective Income Tax Rate % 36.0% 36.0% 36.0% 36.0% 34.5% Adjusted Net Income $118 $125 $136 $140 $118 (1) Total Debt $287 $282 $299 $297 $295 Total shareholders equity $677 $664 $737 $767 $813 Total Capital $964 $946 $1,036 $1,064 $1,108 Prior Year Total Capital $957 $964 $946 $1,036 $1,064 Average Capital $961 $955 $991 $1,050 $1,086 Adjusted Return on Invested Capital (ROIC) (Adjusted Net Income as a % of Average Capital) 12.3% 13.1% 13.8% 13.3% 10.9% (1) Assumes 10 months at 36% and 2 months at 27% as after U.S. Tax Reform 37
2018 Steelcase Inc. Trademarks used herein are the property of Steelcase Inc. or of their respective owners.