Shares of Steelcase (NYSE:SCS), the maker of office furniture, shot upward today. This came after the company posted better-than-expected results in its third-quarter earnings report, beating estimates on both the top and bottom lines.
As a result, the stock was up 16.4% as of market close, making it one of the top stocks of the day.
Steelcase said revenue rose 6% to $955 million, driven by strong organic revenue growth of 8% in the Americas. That beat revenue estimates of $936 million. The company made improvements in both the Americas and the EMEA (Europe, Middle East, Africa) region, cutting costs and passing along price increases.
Lapping a pension charge from the year before helped lift the company's results; operating margin jumped 290 basis points to 7.9%, and earnings per share surged 28% from an adjusted total last year to $0.46, well ahead of the consensus estimate of $0.35.
CEO Jim Keane said: "Our teams continue to execute against our strategies for growth and profit improvement. We continue to capitalize on the investments we've made in new product development and drive initiatives for improving our cost structure."
Looking ahead, Steelcase sees fourth-quarter revenue of between $905 million and $930 million, reflecting an organic decline of 2% to 5% after adjusting for the extra week in the year, and full-year revenue of $3.7 million. Its fourth-quarter revenue guidance was actually worse than estimates for $954 million, as the third quarter benefited from orders being pulled ahead due to the late Thanksgiving holiday.
On the bottom line, the company sees earnings per share of $0.30 to $0.34 for the fourth quarter, which was below estimates of $0.35. For the full year, however, its EPS forecast of $1.41 to $1.45 was better than the consensus for $1.35. That seemed to be enough to lift the stock, in spite of the generally weak guidance.