HNI CORP

Previous wording

The following discussion of the Corporation’s historical results of operations and of its liquidity and capital resources should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements of the Corporation and related notes included elsewhere in this Quarterly Report on Form 10-Q and with the Corporation’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023. All dollar amounts presented are in millions, except per share data or where otherwise indicated. Amounts may not sum due to rounding. Statements that are not historical are forward-looking and involve risks and uncertainties. See "Forward-Looking Statements" at the end of this section for further information about forward-looking statements.

Current wording

The following discussion of the Corporation’s historical results of operations and of its liquidity and capital resources should be read in conjunction with the Unaudited Condensed Consolidated Financial Statements of the Corporation and related notes included elsewhere in this Quarterly Report on Form 10-Q and with the Corporation’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023 filed with the Securities and Exchange Commission (the "2023 Form 10-K"). All dollar amounts presented are in millions, except per share data or where otherwise indicated. Amounts may not sum due to rounding. Statements that are not historical are forward-looking and involve risks and uncertainties. See "Forward-Looking Statements" at the end of this section for further information about forward-looking statements.

Previous wording

In the current period, the Corporation maintained focus on its strategic priorities. In workplace furnishings, ongoing integration of the Kimball International business and related synergies, expanded utilization of the new factory in Mexico, and the recently announced manufacturing facility optimization initiative are enabling the segment's profit transformation plan. The residential building products business continued to navigate cyclical housing market weakness and inconsistent demand trends but remained solidly profitable and committed to investing in capabilities to support long-term growth.

Current wording

In the current period, the Corporation maintained focus on its strategic priorities. In workplace furnishings, ongoing integration of the Kimball International business and related synergies, expanded utilization of the new factory in Mexico, and the previously announced manufacturing facility optimization initiative are enabling the segment's profit transformation plan, despite continued near-term revenue pressure resulting from macroeconomic and U.S. election uncertainties. The residential building products business continued to navigate cyclical housing market softness and inconsistent demand trends resulting from interest rate volatility, ongoing inflation, and affordability issues. In spite of these headwinds, the business remained solidly profitable and committed to investing in capabilities to support long-term growth.

Previous wording

Consolidated net sales for the second quarter of 2024 were $623.7 million, an increase of 10.7 percent compared to net sales of $563.5 million in the prior-year quarter. The change was due to a 16.3 percent increase in net sales in the workplace furnishings segment, partially offset by a 4.6 percent decrease in net sales in the residential building products segment. The acquisition of Kimball International in the second quarter of 2023 increased year-over-year sales by $80.5 million, and the divestiture of Poppin in the third quarter of 2023 decreased year-over-year sales by $3.4 million. See "Note 3. Acquisitions and Divestitures" in the Notes to Condensed Consolidated Financial Statements for more information about the Kimball International acquisition, which affects the comparability of results between the current and prior-year periods.

Current wording

Consolidated net sales for the third quarter of 2024 were $672.2 million, a decrease of 5.5 percent compared to net sales of $711.6 million in the prior-year quarter. The change was due to a 5.9 percent decrease in net sales in the workplace furnishings segment, and a 4.4 percent decrease in net sales in the residential building products segment. The divestiture of Kimball International's Poppin business in the third quarter of 2023 decreased year-over-year sales by $7.7 million.

Previous wording

Net income attributable to the Corporation in the second quarter of 2024 was $36.0 million compared to a net loss of $12.8 million in the second quarter of 2023. The year-over-year increase in net income was driven by improved net productivity, non-repeating acquisition-related costs incurred in the prior-year quarter, and favorable net impacts of the Kimball International acquisition, partially offset by lower volume in the legacy HNI businesses (excluding Kimball International) and elevated healthcare costs.

Current wording

Net income attributable to the Corporation in the third quarter of 2024 was $47.5 million compared to a net income of $37.8 million in the third quarter of 2023. The year-over-year increase in net income was driven by improved net productivity, costs incurred in the prior-year quarter related to the acquisition of Kimball International and the divestiture of Poppin, lower variable compensation, and reduced interest expense, partially offset by lower sales volume.

Previous wording

Results of Operations - Three Months Ended

Current wording

Results of Operations - Three Months Ended September 28, 2024 and September 30, 2023

Previous wording

Gross profit as a percentage of net sales increased 360 basis points in the second quarter of 2024 compared to the same quarter last year, driven by improved operational productivity and the impact of the Kimball International acquisition.

Current wording

Gross profit as a percentage of net sales increased 140 basis points in the third quarter of 2024 compared to the same quarter last year, driven by improved operational productivity, partially offset by lower sales volume, impacts from the exit of Poppin in the prior year, and higher restructuring charges recorded to cost of sales as a result of factory consolidation initiatives in the workplace furnishings segment.

Previous wording

Selling and administrative expenses ("SG&A") as a percentage of net sales decreased 440 basis points in the second quarter of 2024 compared to the same quarter last year. The decrease was driven by $31.3 million of non-repeating Kimball International acquisition-related fees and expenses incurred in the prior-year quarter and improved freight and distribution productivity, partially offset by lower volume in the legacy HNI businesses and elevated healthcare costs.

Current wording

Selling and administrative expenses ("SG&A") as a percentage of net sales decreased 40 basis points in the third quarter of 2024 compared to the same quarter last year. The decrease was driven by $2.8 million of Kimball International acquisition-related fees and expenses incurred in the prior-year quarter, favorable impacts from the divestiture of Poppin in the prior year, and lower variable compensation, partially offset by lower sales volume.

Previous wording

In the second quarter of 2024, the Corporation recorded charges of $2.0 million primarily in connection with a workplace furnishings factory optimization initiative. Charges of $8.1 million were incurred in the same quarter last year mainly related to the exit of the Poppin business.

Current wording

In the third quarter of 2024, the Corporation recorded charges of $1.6 million primarily in connection with reorganization actions in the residential building products segment and factory consolidation initiatives in the workplace furnishings segment. Charges of $5.3 million were incurred in the same quarter last year, mainly related to the exit of the Poppin business.

Previous wording

In the second quarter of 2024, operating margin increased 920 basis points compared to the same quarter last year driven by $31.3 million of non-repeating Kimball International acquisition-related fees and expenses incurred in the prior-year quarter, improved net productivity, favorable impact of the acquisition of Kimball International, and lower restructuring and impairment charges incurred in the current quarter, partially offset by lower volume in the legacy HNI businesses and elevated healthcare costs.

Current wording

In the third quarter of 2024, operating margin increased 220 basis points compared to the same quarter last year, driven by improved net productivity, non-repeating costs incurred in the prior-year quarter mainly related to the Kimball International acquisition and the divestiture of Poppin, and lower variable compensation, partially offset by lower sales volume.

Previous wording

The Corporation’s income tax provision for the second quarter of 2024 was $10.0 million of expense on income before taxes of $46.0 million, or an effective tax rate of 21.7 percent. For the second quarter of 2023, the Corporation’s income tax provision was $3.8 million of expense on a loss before taxes of $9.0 million, or an effective tax rate of (41.8) percent. The variation in the effective tax rates was primarily due to lower pre-tax income in the prior-year quarter impacted by non-deductible transaction costs related to the acquisition of Kimball International in the prior year.

Current wording

The Corporation’s income tax provision for the third quarter of 2024 was $14.3 million of expense on income before taxes of $61.8 million, or an effective tax rate of 23.1 percent. For the third quarter of 2023, the Corporation’s income tax provision was $9.6 million of expense on income before taxes of $47.4 million, or an effective tax rate of 20.3 percent. The variation in the effective tax rates was primarily due to favorable year-to-date adjustments recorded in the third quarter of 2023 in connection with the acquisition of Kimball International.

Previous wording

Net Income (Loss) Attributable to HNI Corporation

Current wording

Net Income Attributable to HNI Corporation

Previous wording

Net income attributable to the Corporation was $36.0 million, or $0.75 per diluted share, in the second quarter of 2024, compared to net loss of $12.8 million, or $0.30 per diluted share, in the second quarter of 2023.

Current wording

Net income attributable to the Corporation was $47.5 million, or $0.98 per diluted share, in the third quarter of 2024, compared to net income of $37.8 million, or $0.80 per diluted share, in the third quarter of 2023.

Previous wording

Consolidated net sales for the first six months of 2024 increased 16.2 percent compared to the same period last year. The change was driven by $228.0 million of favorable impact from the acquisition of Kimball International in the second quarter of 2023, as well as price realization in both the workplace furnishings and residential building products segments. These factors were partially offset by lower volume in the legacy HNI businesses and $3.4 million of unfavorable impact from the divestiture of Poppin in the third quarter of 2023.

Current wording

Consolidated net sales for the first nine months of 2024 increased 7.4 percent compared to the same period last year. The change was driven by $228.0 million of favorable impact from the acquisition of Kimball International in the second quarter of 2023, as well as price realization in both the workplace furnishings and residential building products segments. These factors were partially offset by lower volume in the legacy HNI businesses and an $11.1 million decrease in net sales from the divestiture of Poppin in the third quarter of 2023.

Previous wording

Gross profit as a percentage of net sales increased 340 basis points in the first six months of 2024 compared to the same period last year, driven by improved operational productivity, favorable price-cost, and the impact of the Kimball International acquisition, partially offset by lower volume in the legacy HNI businesses.

Current wording

Gross profit as a percentage of net sales increased 250 basis points in the first nine months of 2024 compared to the same period last year, driven by improved operational productivity, favorable price-cost, and the impact of the Kimball International acquisition, partially offset by lower volume in the legacy HNI businesses.

Previous wording

Selling and administrative expenses as a percentage of net sales decreased 250 basis points in the first six months of 2024 compared to the same period last year. The decrease was driven by $34.7 million of non-repeating Kimball International acquisition-related fees and expenses incurred in the prior-year period and favorable impacts from the acquisition of Kimball International, partially offset by lower volume in the legacy HNI businesses and higher variable compensation.

Current wording

Selling and administrative expenses as a percentage of net sales decreased 150 basis points in the first nine months of 2024 compared to the same period last year. The decrease was driven by $37.5 million of Kimball International acquisition-related fees and expenses incurred in the prior-year period and favorable impacts from the acquisition of Kimball International, partially offset by lower volume in the legacy HNI businesses.

Previous wording

In the first six months of 2024, the Corporation recorded charges of $2.1 million primarily in connection with a workplace furnishings factory optimization initiative. Charges of $8.1 million were incurred in the same period last year mainly related to the exit of the Poppin business.

Current wording

In the first nine months of 2024, the Corporation recorded charges of $3.7 million primarily in connection with factory optimization initiatives in the workplace furnishings segment. Charges of $13.4 million were incurred in the same period last year mainly related to the exit of the Poppin business.

Previous wording

In the first six months of 2024, operating margin increased 660 basis points compared to the same period last year, driven by improved net productivity, favorable price-cost, the impact of the acquisition of Kimball International, non-repeating acquisition-related costs incurred in the prior-year period, and lower restructuring and impairment charges incurred in the current-year period, partially offset by lower volume in the legacy HNI businesses and higher variable compensation.

Current wording

In the first nine months of 2024, operating margin increased 470 basis points compared to the same period last year, driven by improved net productivity, favorable price-cost, the benefit of a full nine months of ownership of Kimball International in the current-year period, acquisition-related costs incurred in the prior-year period, and lower restructuring and impairment charges incurred in the current-year period, partially offset by lower volume in the legacy HNI businesses.

Previous wording

Interest expense, net for the first six months of 2024 was $15.1 million, compared to $8.2 million in the same period last year, driven by higher average outstanding borrowings resulting from indebtedness incurred to fund the acquisition of Kimball International and higher interest rates in the current period on the Corporation's variable-rate revolving debt obligations.

Current wording

Interest expense, net for the first nine months of 2024 was $22.1 million, compared to $17.5 million in the same period last year, driven by higher average outstanding borrowings resulting from indebtedness incurred in June 2023 to fund the acquisition of Kimball International and higher interest rates in the current period on the Corporation's variable-rate revolving debt obligations.

Previous wording

The Corporation’s income tax provision for the first six months of 2024 was $14.3 million of expense on income before taxes of $68.0 million, or an effective tax rate of 21.0 percent. For the first six months of 2023, the Corporation’s income tax expense was $6.0 million on a loss before taxes of $5.3 million, or an effective tax rate of (113.1) percent. The variation in the effective tax rates was primarily due to lower pre-tax income in the prior-year period impacted by non-deductible transaction costs related to the acquisition of Kimball International in the prior year.

Current wording

The Corporation’s income tax provision for the first nine months of 2024 was $28.6 million of expense on income before taxes of $129.8 million, or an effective tax rate of 22.0 percent. For the first nine months of 2023, the Corporation’s income tax expense was $15.6 million on income before taxes of $42.1 million, or an effective tax rate of 37.1 percent. The variation in the effective tax rates was primarily due to non-deductible transaction costs incurred in 2023 in connection with the acquisition of Kimball International.

Previous wording

Net Income (Loss) Attributable to HNI Corporation

Current wording

Net Income Attributable to HNI Corporation

Previous wording

Net income attributable to the Corporation was $53.7 million, or $1.11 per diluted share, in the first six months of 2024, compared to net loss of $11.3 million, or $0.27 per diluted share, in the first six months of 2023.

Current wording

Net income attributable to the Corporation was $101.2 million, or $2.09 per diluted share, in the first nine months of 2024, compared to net income of $26.5 million, or $0.60 per diluted share, in the first nine months of 2023.

Previous wording

Second quarter 2024 net sales for the workplace furnishings segment increased 16.3 percent compared to the same quarter last year. The acquisition of Kimball International in the second quarter of 2023 increased net sales by $80.5 million compared to the prior-year quarter, while the divestiture of Poppin in the third quarter of 2023 decreased year-over-year sales by $3.4 million. Adjusting for the impact of these transactions, segment sales decreased 2.4 percent year-over-year, driven by lower volume in the contract office customer channel.

Current wording

Third quarter 2024 net sales for the workplace furnishings segment decreased 5.9 percent compared to the same quarter last year, driven by lower volume in the contract office customer channel, partially offset by higher volume in the hospitality channel and price realization. In addition, the divestiture of Poppin in the third quarter of 2023 decreased year-over-year sales by $7.7 million.

Previous wording

Operating income as a percentage of net sales in the second quarter of 2024 improved 750 basis points compared to the same period in 2023. The increase was driven by improved net productivity, favorable impacts from the Kimball International acquisition and the divestiture of Poppin, $10.3 million of non-repeating acquisition-related costs incurred in the prior-year quarter, and lower restructuring and impairment charges in the current quarter.

Current wording

Operating income as a percentage of net sales in the third quarter of 2024 improved 260 basis points compared to the same period in 2023. The increase was driven by improved net productivity and costs associated with the exit of Poppin incurred in the prior-year quarter, partially offset by lower sales volume and restructuring charges in the current quarter related to manufacturing optimization initiatives.

Previous wording

Net sales for the first six months of 2024 for the workplace furnishings segment increased 29.1 percent compared to the same period last year. The acquisition of Kimball International in the second quarter of 2023 increased net sales by $228.0 million compared to the prior-year period, while the divestiture of Poppin in the third quarter of 2023 decreased year-over-year sales by $3.4 million. Adjusting for the impact of these transactions, segment sales decreased 2.4 percent year-over-year, driven by lower volume in the contract office customer channel, partially offset by increased volume with small to medium-sized customers and price realization.

Current wording

Net sales for the first nine months of 2024 for the workplace furnishings segment increased 14.1 percent compared to the same period last year. The acquisition of Kimball International in the second quarter of 2023 increased net sales by $228.0 million compared to the prior-year period, while the divestiture of Poppin in the third quarter of 2023 decreased year-over-year sales by $11.1 million. Excluding the impact of these transactions, segment sales decreased year-over-year, driven by lower volume in the contract office customer channel, partially offset by higher volume in the hospitality channel and price realization.

Previous wording

Operating income as a percentage of net sales in the first six months of 2024 improved 710 basis points compared to the same period in 2023. The increase was driven by improved net productivity, impacts from the Kimball International acquisition, favorable price-cost, non-repeating acquisition-related costs incurred in the prior-year period, and lower restructuring and impairment charges in the current-year period. These factors were partially offset by lower volume in the legacy HNI workplace businesses and higher variable compensation.

Current wording

Operating income as a percentage of net sales in the first nine months of 2024 improved 500 basis points compared to the same period in 2023. The increase was driven by improved net productivity, favorable price-cost, the benefit of a full nine months of Kimball International ownership in the current-year period, favorable impacts from the exit of Poppin in the prior-year period, and Kimball International acquisition-related costs and Poppin exit-related costs in the prior-year period. These factors were partially offset by lower volume in the legacy HNI workplace businesses.

Previous wording

Second quarter 2024 net sales for the residential building products segment decreased 4.6 percent compared to the same quarter last year. The decline was primarily driven by lower volume in the existing home channel. Demand pressure from a soft housing market and reduced home remodeling activity was partially offset by price realization versus the prior-year quarter.

Current wording

Third quarter 2024 net sales for the residential building products segment decreased 4.4 percent compared to the same quarter last year. The decline was driven by lower volume in the existing home channel due to reduced home remodeling activity, partially offset by a modest increase in the new construction channel.

Previous wording

Net sales for the first six months of 2024 for the residential building products segment decreased 11.6 percent compared to the same period last year. The decline was driven by lower volume in both the existing home and new construction channel. Demand pressure from a soft housing market and reduced home remodeling activity was partially offset by price realization versus the prior-year period.

Current wording

Net sales for the first nine months of 2024 for the residential building products segment decreased 9.1 percent compared to the same period last year. The decline was driven by lower volume in both the existing home and new construction channels. Demand pressure from a soft housing market and reduced home remodeling activity was partially offset by price realization versus the prior-year period.

Previous wording

Operating income as a percentage of net sales increased 350 basis points in the second quarter of 2024 compared to the same quarter last year driven by improved net productivity, favorable product mix, and lower core SG&A, partially offset by lower volume.

Current wording

Operating income as a percentage of net sales in the first nine months of 2024 increased 70 basis points compared to the same period last year driven by improved net productivity, favorable price-cost and product mix, and lower variable compensation, partially offset by lower sales volume.

Previous wording

Cash, cash equivalents, and short-term investments, coupled with cash flow from future operations, borrowing capacity expected to be available under the Corporation's existing credit agreements, and the ability to access capital markets, are expected to be adequate to fund operations and satisfy cash flow needs for at least the next twelve months. Based on current performance, the Corporation can access the full $425 million of borrowing capacity available under its revolving credit facility, which includes the $114 million currently outstanding, and maintain compliance with applicable covenants.

Current wording

Cash, cash equivalents, and short-term investments, coupled with cash flow from future operations, borrowing capacity expected to be available under the Corporation's existing credit agreements, and the ability to access capital markets, are expected to be adequate to fund operations and satisfy cash flow needs for at least the next twelve months. Based on current performance, the Corporation can access the full $425 million of borrowing capacity available under its revolving credit facility, which includes the $46 million of borrowings currently outstanding, and maintain compliance with applicable covenants.

Previous wording

Operating cash flows were $47.0 million for the first six months of 2024 compared $39.8 million for the first six months of 2023. In the prior-year period, net income included costs associated with the acquisition of Kimball International, which did not recur in the current-year period. Additionally, the net income benefits from owning Kimball International for the entire period combined with improved financial performance in the remaining HNI businesses, drove improvement to net income. The increase in income was mostly offset by higher usage of working capital. Working capital was a use of cash during the current-year period. Historically, the Corporation experiences seasonal cash usage during the first half of the fiscal year. The current year working capital cash usage was consistent with normal historical patterns. The comparable prior-year period did not follow the normal seasonal pattern due to the impacts and timing of the acquisition of Kimball International.

Current wording

Operating cash flows were $175.5 million for the first nine months of 2024 compared to $162.5 million for the first nine months of 2023. In the prior-year period, net income included costs associated with the acquisition of Kimball International, which did not recur in the current-year period. Additionally, the net income benefits from owning Kimball International for the entire period combined with improved financial performance in the remaining HNI businesses drove improvement to net income. The increase in income was mostly offset by higher usage of working capital. Working capital was a use of cash during the current-year period, compared to a source of cash in the prior-year period. The current-year working capital cash usage was consistent with normal historical patterns. The comparable prior-year period did not follow the normal seasonal pattern due to the impacts and timing of the acquisition of Kimball International.

Previous wording

Capital Expenditures - Capital expenditures, including capitalized software, for the first six months of 2024 were $28.7 million compared to $41.2 million in the same period last year. In the prior-year period, the Corporation had higher expenditures related to a manufacturing facility expansion, which did not recur in the current period. The current year expenditures are primarily focused on machinery, equipment, and tooling required to support new products, continuous improvements, and cost savings initiatives in manufacturing processes. Additionally, in support of the Corporation’s long-term strategy to create effortless winning experiences for customers, the Corporation continues to invest in technology and digital assets. For the full year 2024, capital expenditures are expected to be approximately $75 to 85 million.

Current wording

Capital Expenditures - Capital expenditures, including capitalized software, for the first nine months of 2024 were $43.2 million compared to $62.8 million in the same period last year. In the prior-year period, the Corporation had higher expenditures related to a manufacturing facility expansion, which did not recur in the current period. The current-year expenditures are primarily focused on machinery, equipment, and tooling required to support new products, continuous improvements, and cost savings initiatives in manufacturing processes. Additionally, in support of the Corporation’s long-term strategy to create effortless winning experiences for customers, the Corporation continues to invest in technology and digital assets. For the full year 2024, capital expenditures are expected to be approximately $60 to 70 million.

Previous wording

Acquisition - Investing activities in the first six months of 2023 included $369.8 million of cash outflows related to the acquisition of Kimball International. See "Note 3. Acquisitions and Divestitures" in the Notes to the Condensed Consolidated Financial Statements for further information.

Current wording

Acquisition and Divestitures - Investing activities in the first nine months of 2023 included $369.7 million of cash outflows related to the acquisition of Kimball International, and $3.1 million received from the sale of Poppin (net of costs to sell). See "Note 3. Acquisitions and Divestitures" in the Notes to the Condensed Consolidated Financial Statements for further information.

Previous wording

Debt - The Corporation maintains a revolving credit facility as the primary source of committed funding from which the Corporation finances its planned capital expenditures, strategic initiatives, and seasonal working capital needs. Cash flows included in financing activities for the current and prior periods presented represent periodic borrowings and repayments under the revolving credit facility.

Current wording

Debt - The Corporation maintains a revolving credit facility as the primary source of committed funding from which the Corporation finances its planned capital expenditures, strategic initiatives, and seasonal working capital needs. Cash flows included in financing activities for the current and prior periods presented include periodic borrowings and repayments under the revolving credit facility.

Previous wording

Additionally, in the second quarter of 2023, the Corporation borrowed $300 million in connection with a term loan agreement entered into on March 31, 2023, as amended on May 25, 2023, to support funding of the acquisition of Kimball International. In the second quarter of 2024, the Corporation executed a $50 million early repayment of the outstanding principal balance on this term loan. The repayment was financed using borrowings from the revolving credit facility. As a result, no additional principal amortization is currently due to be repaid for the term loan prior to March 2027. See "Note 7. Debt" in the Notes to Condensed Consolidated Financial Statements for further information.

Current wording

Additionally, in the second quarter of 2023, the Corporation borrowed $300 million in connection with a term loan agreement entered into on March 31, 2023, as amended on May 25, 2023, to support funding of the acquisition of Kimball International. In the second quarter of 2024, the Corporation executed a $50 million early repayment of the outstanding principal balance on this term loan, with an additional early repayment of $50 million in the third quarter of 2024. As a result, no additional principal amortization is due prior to maturity of the facility in March 2028. See "Note 7. Debt" in the Notes to Condensed Consolidated Financial Statements for further information.

Previous wording

Dividend - The Corporation is committed to maintaining or modestly growing the quarterly dividend. Cash dividends declared and paid per common share were as follows:

Current wording

Dividend - The Corporation is committed to maintaining or modestly increasing the quarterly dividend rate. Cash dividends declared and paid per common share were as follows:

Previous wording

During the second quarter of 2024, the Board of Directors declared the regular quarterly cash dividend on May 13, 2024. The dividend was paid on June 12, 2024, to shareholders of record as of May 24, 2024.

Current wording

During the third quarter of 2024, the Board of Directors declared the regular quarterly cash dividend at the rate of $0.33 per share on August 12, 2024. The dividend was paid on September 12, 2024, to shareholders of record as of August 23, 2024.

Previous wording

Stock Repurchase - The Corporation’s capital strategy related to stock repurchase is focused on offsetting the dilutive impact of issuances of common stock pursuant to equity awards granted for various compensation-related matters. The Corporation also may elect to opportunistically purchase additional shares based on excess cash generation and/or share price considerations. During the six months ended June 29, 2024, the Corporation spent $13.4 million to repurchase shares of its common stock. As of June 29, 2024, $220.0 million was authorized and available for repurchase of shares by the Corporation. See "Note 10. Accumulated Other Comprehensive Income (Loss) and Shareholders’ Equity" in the Notes to Condensed Consolidated Financial Statements for further information.

Current wording

Stock Repurchase - The Corporation’s capital strategy related to stock repurchase is focused on offsetting the dilutive impact of issuances of common stock pursuant to equity awards granted for various compensation-related matters. The Corporation also may elect to opportunistically purchase additional shares based on excess cash generation and/or share price considerations. During the nine months ended September 28, 2024, the Corporation spent $24.8 million to repurchase 0.5 million shares of its common stock. As of September 28, 2024, $208.2 million was authorized and available for repurchase of shares by the Corporation. See "Note 10. Accumulated Other Comprehensive Income (Loss) and Shareholders’ Equity" in the Notes to Condensed Consolidated Financial Statements for further information.

Previous wording

Sales of Stock - The Corporation records cash flows received from the sale of its common stock held in treasury, primarily in connection with stock option exercises and the HNI Corporation Members’ Stock Purchase Plan. See "Note 10. Accumulated

Current wording

Sales of Stock - The Corporation records cash flows received from the sale of its common stock held in treasury, primarily in connection with stock option exercises and the HNI Corporation Members’ Stock Purchase Plan. The increase in cash proceeds in the current-year period was due to a significant uptick in stock options exercised, driven by growth in the market value per share of the Corporation's common stock. See "Note 10. Accumulated Other Comprehensive Income (Loss) and Shareholders’ Equity" and "Note 12. Stock-Based Compensation" in the Notes to Condensed Consolidated Financial Statements for further information.

Previous wording

Various commitments and obligations associated with ongoing business and financing activities will result in cash payments in future periods. A summary of the amounts and estimated timing of these future cash payments is presented in the Corporation’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023. There were no material changes outside the ordinary course of business in the Corporation’s contractual obligations or the estimated timing of the future cash payments during the first six months of 2024.

Current wording

Various commitments and obligations associated with ongoing business and financing activities will result in cash payments in future periods. A summary of the amounts and estimated timing of these future cash payments is presented in the 2023 Form 10-K. There were no material changes outside the ordinary course of business in the Corporation’s contractual obligations or the estimated timing of the future cash payments during the first nine months of 2024, except as previously disclosed related to the early repayment of term loan principal.

Previous wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon the Consolidated Financial Statements, prepared in accordance with generally accepted accounting principles ("GAAP"). The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses, and related disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on a variety of other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Senior management has discussed the development, selection, and disclosure of these estimates with the Audit Committee of the Board of Directors. Actual results may differ from these estimates under different assumptions or conditions. A summary of the more significant accounting policies requiring the use of estimates and assumptions in preparing the financial statements is provided in the Corporation’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023.

Current wording

Management’s Discussion and Analysis of Financial Condition and Results of Operations is based upon the Consolidated Financial Statements, prepared in accordance with generally accepted accounting principles ("GAAP"). The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses, and related disclosure of contingent assets and liabilities. Management bases its estimates on historical experience and on a variety of other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Senior management has discussed the development, selection, and disclosure of these estimates with the Audit Committee of the Board of Directors. Actual results may differ from these estimates under different assumptions or conditions. A summary of the more significant accounting policies requiring the use of estimates and assumptions in preparing the financial statements is provided in the 2023 Form 10-K.