Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
May 30, 2020 | Jul. 22, 2020 | Nov. 30, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | May 30, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-15141 | ||
Entity Registrant Name | HERMAN MILLER, INC. | ||
Entity Incorporation, State or Country Code | MI | ||
Entity Tax Identification Number | 38-0837640 | ||
Entity Address, Address Line One | 855 East Main Avenue | ||
Entity Address, City or Town | Zeeland | ||
Entity Address, State or Province | MI | ||
Entity Address, Postal Zip Code | 49464 | ||
City Area Code | 616 | ||
Local Phone Number | 654-3000 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | MLHR | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2,800,000 | ||
Entity Common Stock, Shares Outstanding | 58,866,863 | ||
Documents Incorporated by Reference [Text Block] | Certain portions of the Registrant's Proxy Statement for the Annual Meeting of Stockholders expected to be held on October 12, 2020, are incorporated by reference into Part III of this report. | ||
Entity Central Index Key | 0000066382 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --05-30 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net sales | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Cost of sales | 1,575.9 | 1,637.3 | 1,508.2 |
Gross margin | 910.7 | 929.9 | 873 |
Operating (loss) earnings | |||
Selling, general and administrative | 643.3 | 639.3 | 615.3 |
Impairment charges | 205.4 | 0 | 0 |
Restructuring expenses | 26.4 | 10.2 | 5.7 |
Design and research | 74 | 76.9 | 73.1 |
Total operating expenses | 949.1 | 726.4 | 694.1 |
Operating (loss) earnings | (38.4) | 203.5 | 178.9 |
Gain on consolidation of equity method investments | 36.2 | 0 | 0 |
Interest expense | 12.5 | 12.1 | 13.5 |
Interest and other investment income | (2.3) | (2.1) | (4.4) |
Other expense (income), net | 1 | (1.6) | 1.7 |
(Loss) Earnings before income taxes and equity income | (13.4) | 195.1 | 168.1 |
Income tax expense | 6 | 39.6 | 42.4 |
Equity earnings from nonconsolidated affiliates, net of tax | 5 | 5 | 3 |
Net (loss) earnings | (14.4) | 160.5 | 128.7 |
Net (loss) earnings attributable to redeemable noncontrolling interests | (5.3) | 0 | 0.6 |
Net (loss) earnings attributable to Herman Miller, Inc. | $ (9.1) | $ 160.5 | $ 128.1 |
(Loss) Earnings per share — basic | $ (0.15) | $ 2.72 | $ 2.15 |
(Loss) Earnings per share — diluted | $ (0.15) | $ 2.70 | $ 2.12 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments | $ (7.7) | $ (14.2) | $ 2.7 |
Pension and post-retirement liability adjustments | (14.2) | (7.8) | 10.4 |
Unrealized (losses) gains on interest rate swap agreement | (18) | (12.3) | 7.8 |
Unrealized holding gains on securities | 0.1 | 0 | 0 |
Total other comprehensive (loss) income | (39.8) | (34.3) | 20.9 |
Comprehensive (loss) income | (54.2) | 126.2 | 149.6 |
Comprehensive (loss) income attributable to redeemable noncontrolling interests | (5.3) | 0 | 0.6 |
Comprehensive (loss) income attributable to Herman Miller, Inc. | $ (48.9) | $ 126.2 | $ 149 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 454 | $ 159.2 |
Short-term investments | 7 | 8.8 |
Accounts receivable, net of allowances of $4.7 and $3.8 | 180 | 218 |
Unbilled accounts receivable | 19.5 | 34.3 |
Inventories, net | 197.3 | 184.2 |
Prepaid expenses | 43.3 | 45.8 |
Other current assets | 16 | 11 |
Total current assets | 917.1 | 661.3 |
Property and equipment, net of accumulated depreciation of $780.5 and $736.1 | 330.8 | 348.6 |
Right of use assets | 193.9 | 0 |
Goodwill | 346 | 303.8 |
Indefinite-lived intangibles | 92.8 | 78.1 |
Other amortizable intangibles, net of accumulated amortization of $62.7 and $46.2 | 112.4 | 41.1 |
Other noncurrent assets | 60.9 | 136.4 |
Total Assets | 2,053.9 | 1,569.3 |
Current Liabilities: | ||
Accounts payable | 128.8 | 177.7 |
Short-term borrowings and current portion of long-term debt | 51.4 | 3.1 |
Accrued compensation and benefits | 71.1 | 85.5 |
Accrued warranty | 59.2 | 53.1 |
Customer deposits | 39.8 | 30.7 |
Other accrued liabilities | 163 | 96 |
Total current liabilities | 513.3 | 446.1 |
Long-term debt | 539.9 | 281.9 |
Pension and post-retirement benefits | 42.4 | 24.5 |
Lease liabilities | 178.8 | 0 |
Other liabilities | 86.1 | 77 |
Total Liabilities | 1,360.5 | 829.5 |
Redeemable noncontrolling interests | 50.4 | 20.6 |
Stockholders' Equity: | ||
Preferred stock, no par value (10,000,000 shares authorized, none issued) | 0 | 0 |
Common stock, $0.20 par value (240,000,000 shares authorized, 58,793,275 and 58,794,148 shares issued and outstanding in 2020 and 2019, respectively) | 11.8 | 11.7 |
Additional paid-in capital | 81.6 | 89.8 |
Retained earnings | 683.9 | 712.7 |
Accumulated other comprehensive loss | (134) | (94.2) |
Deferred compensation plan | (0.3) | (0.8) |
Herman Miller, Inc. Stockholders' Equity | 643 | 719.2 |
Total Liabilities, Redeemable Noncontrolling Interests and Stockholders' Equity | $ 2,053.9 | $ 1,569.3 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable allowances | $ 4.7 | $ 3.8 |
Preferred Stock, No Par Value | $ 0 | $ 0 |
Preferred Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.20 | $ 0.20 |
Common Stock, Shares Authorized | 240,000,000 | 240,000,000 |
Common stock, Shares Issued and Outstanding | 58,793,275 | 58,794,148 |
Property and equipment accumulated depreciation | $ (780.5) | $ (736.1) |
Other amortizable intangibles accumulated amortization | $ 62.7 | $ 46.2 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Deferred Compensation Plan | Herman Miller, Inc. Stockholders' Equity | Noncontrolling Interests |
Balance at beginning of year (shares) at Jun. 03, 2017 | 59,715,824 | |||||||
Balance at beginning of year at Jun. 03, 2017 | $ 587.7 | $ 11.9 | $ 139.3 | $ 519.5 | $ (82.2) | $ (1) | $ 587.5 | $ 0.2 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings attributable to Herman Miller, Inc. | 128.1 | 128.1 | 128.1 | |||||
Net (loss) earnings | 128.7 | |||||||
Other comprehensive income, net of tax | 20.9 | 20.9 | 20.9 | |||||
Stock-based compensation expense | 7 | 7 | 7 | |||||
Exercise of stock options (shares) | 538,259 | |||||||
Exercise of stock options | 14.6 | 14.6 | 14.6 | |||||
Restricted and performance stock units released (shares) | 256,884 | |||||||
Restricted and performance stock units released | $ 0.3 | $ 0.1 | 0.2 | 0.3 | ||||
Employee stock purchase plan issuances (shares) | 67,335 | 67,335 | ||||||
Employee stock purchase plan issuances | $ 2 | 2 | 2 | |||||
Repurchase and retirement of common stock (shares) | (1,356,156) | |||||||
Repurchase and retirement of common stock | (46.5) | $ (0.3) | (46.2) | (46.5) | ||||
Directors' fees (shares) | 8,828 | |||||||
Directors' fees | 0.4 | 0.4 | 0.4 | |||||
Deferred compensation plan | (0.1) | (0.4) | 0.3 | (0.1) | ||||
Dividends declared | (43.2) | (43.2) | (43.2) | |||||
Redemption value adjustment | (6.2) | (6.2) | (6.2) | |||||
Balance at end of year (shares) at Jun. 02, 2018 | 59,230,974 | |||||||
Balance at end of year at Jun. 02, 2018 | 664.8 | $ 11.7 | 116.6 | 598.3 | (61.3) | (0.7) | 664.6 | 0.2 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings attributable to Herman Miller, Inc. | 160.5 | 160.5 | 160.5 | |||||
Net (loss) earnings | 160.5 | |||||||
Other comprehensive income, net of tax | (34.3) | (34.3) | (34.3) | |||||
Stock-based compensation expense | 8.2 | 8.4 | 8.4 | (0.2) | ||||
Exercise of stock options (shares) | 347,248 | |||||||
Exercise of stock options | 10.1 | $ 0.1 | 10 | 10.1 | ||||
Restricted and performance stock units released (shares) | 468,807 | |||||||
Restricted and performance stock units released | $ 0.3 | $ 0.1 | 0.2 | 0.3 | ||||
Employee stock purchase plan issuances (shares) | 62,957 | 62,957 | ||||||
Employee stock purchase plan issuances | $ 1.9 | 1.9 | 1.9 | |||||
Repurchase and retirement of common stock (shares) | (1,326,023) | |||||||
Repurchase and retirement of common stock | (47.8) | $ (0.2) | (47.6) | (47.8) | ||||
Directors' fees (shares) | 10,185 | |||||||
Directors' fees | 0.3 | 0.3 | 0.3 | |||||
Deferred compensation plan | (0.1) | (0.1) | (0.1) | |||||
Dividends declared | $ (46.6) | (46.6) | (46.6) | |||||
Balance at end of year (shares) at Jun. 01, 2019 | 58,794,148 | 58,794,148 | ||||||
Balance at end of year at Jun. 01, 2019 | $ 719.2 | $ 11.7 | 89.8 | 712.7 | (94.2) | (0.8) | 719.2 | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net earnings attributable to Herman Miller, Inc. | (9.1) | (9.1) | ||||||
Net (loss) earnings | (14.4) | |||||||
Other comprehensive income, net of tax | (39.8) | (39.8) | ||||||
Stock-based compensation expense | 2.7 | 2.7 | 2.7 | |||||
Exercise of stock options (shares) | 423,815 | |||||||
Exercise of stock options | 13.5 | $ 0.2 | 13.3 | 13.5 | ||||
Restricted and performance stock units released (shares) | 138,590 | |||||||
Restricted and performance stock units released | $ 0.2 | 0.2 | 0.2 | |||||
Employee stock purchase plan issuances (shares) | 70,145 | 70,145 | ||||||
Employee stock purchase plan issuances | $ 2.1 | 2.1 | 2.1 | |||||
Repurchase and retirement of common stock (shares) | (641,192) | |||||||
Repurchase and retirement of common stock | (26.6) | $ (0.1) | (26.5) | (26.6) | ||||
Directors' fees (shares) | 7,769 | |||||||
Directors' fees | 0.3 | 0.3 | 0.3 | |||||
Deferred compensation plan | 0.2 | (0.3) | 0.5 | 0.2 | ||||
Dividends declared | (37.5) | (37.5) | (37.5) | |||||
Redemption value adjustment | $ 17.8 | 17.8 | 17.8 | |||||
Balance at end of year (shares) at May. 30, 2020 | 58,793,275 | 58,793,275 | ||||||
Balance at end of year at May. 30, 2020 | $ 643 | $ 11.8 | $ 81.6 | $ 683.9 | $ (134) | $ (0.3) | $ 643 | $ 0 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Statement of Stockholders' Equity [Abstract] | |||
Dividends declared | $ 0.63 | $ 0.79 | $ 0.72 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Cash Flows from Operating Activities: | |||
Net (loss) earnings | $ (14.4) | $ 160.5 | $ 128.7 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Depreciation expense | 68.1 | 65.9 | 60.9 |
Amortization expense | 11.4 | 6.2 | 6 |
Earnings from nonconsolidated affiliates net of dividends received | (4.8) | (2.1) | (0.2) |
Investment fair value adjustment | 0 | (2.1) | 0 |
Gain on consolidation of equity method investments | 36.2 | 0 | 0 |
Deferred taxes | (25.2) | 0.8 | (0.8) |
Pension contributions | (0.9) | (0.9) | (13.4) |
Pension and post-retirement expenses | 1.6 | 1.2 | 2.9 |
Impairment charges | 205.4 | 0 | 0 |
Restructuring expenses | 26.4 | 10.2 | 5.7 |
Stock-based compensation | 2.7 | 7.3 | 7.7 |
Increase in long-term assets | (4.7) | (0.4) | (2.2) |
Increase in long-term liabilities | 5.8 | 1.6 | 3.4 |
Decrease (increase) in accounts receivable & unbilled accounts receivable | 68.6 | (24.8) | (33.1) |
Decrease (increase) in inventories | 6 | (31.9) | (12.4) |
(Decrease) increase in prepaid expenses and other | (2.2) | (0.6) | (3) |
(Decrease) increase in accounts payable | (59.5) | 0.5 | 16 |
(Decrease) increase in accrued liabilities | (32) | 22.7 | (0.3) |
Other, net | 5.7 | 2.3 | 0.6 |
Net Cash Provided by Operating Activities | 221.8 | 216.4 | 166.5 |
Cash Flows from Investing Activities: | |||
Marketable securities purchases | (3.1) | (1.9) | (1) |
Marketable securities sales | 5 | 1.7 | 1 |
Capital expenditures | (69) | (85.8) | (70.6) |
Proceeds from sales of property and dealers | 0.2 | 0.5 | 2.1 |
Proceeds from life insurance policy | 0 | 0 | 8.1 |
Purchase of HAY licensing agreement | 0 | (4.8) | 0 |
Acquisitions, net of cash received | (111.2) | 0 | 0 |
Equity investment in non-controlled entities | (3.3) | (73.6) | 0 |
Other, net | 13.3 | (1.1) | (2.3) |
Net Cash Used in Investing Activities | (168.1) | (165) | (62.7) |
Cash Flows from Financing Activities: | |||
Borrowings of long-term debt | 50 | 0 | 0 |
Repayments of long-term debt | 0 | 0 | (150) |
Proceeds from credit facility | 265 | 0 | 340.4 |
Repayments of credit facility | 0 | 0 | (115.4) |
Dividends paid | (36.4) | (45.6) | (42.4) |
Common stock issued | 15.6 | 12.3 | 17 |
Common stock repurchased and retired | (26.6) | (47.9) | (46.5) |
Purchase of redeemable noncontrolling interests | (20.3) | (10.1) | (1) |
Other, net | (3.3) | (0.6) | 0.4 |
Net Cash Provided by (Used in) Financing Activities | 244 | (91.9) | 2.5 |
Effect of exchange rate changes on cash and cash equivalents | (2.9) | (4.2) | 1.4 |
Net Increase In Cash and Cash Equivalents | 294.8 | (44.7) | 107.7 |
Cash and cash equivalents, Beginning of Year | 159.2 | 203.9 | 96.2 |
Cash and Cash Equivalents, End of Year | 454 | 159.2 | 203.9 |
Other Cash Flow Information | |||
Interest paid | 11.4 | 11.5 | 16.4 |
Income taxes paid, net of cash received | $ 39.6 | $ 41 | $ 34.2 |
Significant Accounting and Repo
Significant Accounting and Reporting Policies | 12 Months Ended |
May 30, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting and Reporting Policies | Significant Accounting and Reporting Policies The following is a summary of significant accounting and reporting policies not reflected elsewhere in the accompanying financial statements. Principles of Consolidation The Consolidated Financial Statements include the accounts of Herman Miller, Inc. and its controlled domestic and foreign subsidiaries. The consolidated entities are collectively referred to as “the Company.” All intercompany accounts and transactions have been eliminated in the Consolidated Financial Statements. Description of Business The Company researches, designs, manufactures, sells and distributes interior furnishings for use in various environments including office, healthcare, educational and residential settings and provides related services that support companies all over the world. The Company's products are sold primarily through independent contract office furniture dealers as well as the following channels: owned contract office furniture dealers, direct customer sales, independent retailers, owned retail studios, direct-mail catalogs and the Company's e-commerce platforms. Fiscal Year The Company's fiscal year ends on the Saturday closest to May 31. The fiscal years ended May 30, 2020 , June 1, 2019 , and June 2, 2018 contained 52 weeks. Foreign Currency Translation The functional currency for most of the foreign subsidiaries is their local currency. The cumulative effects of translating the balance sheet accounts from the functional currency into the United States dollar using fiscal year-end exchange rates and translating revenue and expense accounts using average exchange rates for the period are reflected as a component of Accumulated other comprehensive loss in the Consolidated Balance Sheets. The financial statement impact of gains and losses resulting from remeasuring foreign currency transactions into the appropriate functional currency resulted in a net loss of $1.1 million , net gain of $0.3 million , and a net gain of $0.4 million for the fiscal years ended May 30, 2020 , June 1, 2019 , and June 2, 2018 , respectively. These amounts are included in “ Other expense (income), net ” in the Consolidated Statements of Comprehensive Income. Cash Equivalents The Company holds cash equivalents as part of its cash management function. Cash equivalents include money market funds and time deposit investments with original maturities of less than three months. The carrying value of cash equivalents, which approximates fair value, totaled $364.0 million an d $102.8 million as of May 30, 2020 and June 1, 2019 , respectively. All cash equivalents are high-credit quality financial instruments and the amount of credit exposure to any one financial institution or instrument is limited. Marketable Securities The Company maintains a portfolio of marketable securities primarily comprised of mutual funds. These mutual funds are comprised of both equity and fixed income funds. These investments are held by the Company's wholly owned insurance captive and have been recorded at fair value based on quoted market prices. Net unrealized holding gains or losses related to the equity mutual funds are recorded through net income while net unrealized holding gains or losses related to the fixed income mutual funds are recorded through other comprehensive income. All marketable security transactions are recognized on the trade date. Realized gains and losses are included in “Interest and other investment income” in the Consolidated Statements of Comprehensive Income. See Note 12 of the Consolidated Financial Statements for additional disclosures of marketable securities. Accounts Receivable Allowances Reserves for uncollectible accounts receivable balances are based on known customer exposures, historical credit experience and the specific identification of other potentially uncollectible accounts. Balances are written off against the reserve once the Company determines the probability of collection to be remote. The Company generally does not require collateral or other security on trade accounts receivable. Concentrations of Credit Risk The Company's trade receivables are primarily due from independent dealers who, in turn, carry receivables from their customers. The Company monitors and manages the credit risk associated with individual dealers and direct customers where applicable. Dealers are responsible for assessing and assuming credit risk of their customers and may require their customers to provide deposits, letters of credit or other credit enhancement measures. Some sales contracts are structured such that the customer payment or obligation is direct to the Company. In those cases, the Company may assume the credit risk. Whether from dealers or customers, the Company's trade credit exposures are not concentrated with any particular entity. Inventories Inventories are valued at the lower of cost or market and include material, labor and overhead. Inventory cost is determined using the last-in, first-out (LIFO) method at manufacturing facilities in Michigan, whereas inventories of the Company's other locations are valued using the first-in, first-out (FIFO) method. The Company establishes reserves for excess and obsolete inventory based on prevailing circumstances and judgment for consideration of current events, such as economic conditions, that may affect inventory. The reserve required to record inventory at lower of cost or net realizable value may be adjusted in response to changing conditions. Further information on the Company's recorded inventory balances can be found in Note 4 of the Consolidated Financial Statements. Goodwill and Indefinite-lived Intangible Assets Goodwill and other indefinite-lived assets included in the Consolidated Balance Sheets consist of the following: (In millions) Goodwill Indefinite-lived Intangible Assets Total Goodwill and Indefinite-lived Intangible Assets Balance, June 2, 2018 $ 304.1 $ 78.1 $ 382.2 Foreign currency translation adjustments (0.3 ) — (0.3 ) Balance, June 2, 2019 $ 303.8 $ 78.1 $ 381.9 Foreign currency translation adjustments (0.9 ) (0.5 ) (1.4 ) Acquisition of HAY 111.1 60.0 171.1 Acquisition of naughtone 57.5 8.5 66.0 Impairment charges (125.5 ) (53.3 ) (178.8 ) Balance, May 30, 2020 $ 346.0 $ 92.8 $ 438.8 Goodwill is tested for impairment at the reporting unit level annually, or more frequently, when events or changes in circumstances indicate that the fair value of a reporting unit has more likely than not declined below its carrying value. When testing goodwill for impairment, the Company may first assess qualitative factors. If an initial qualitative assessment identifies that it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value, additional quantitative testing is performed. The Company may also elect to bypass the qualitative testing and proceed directly to the quantitative testing. If the quantitative testing indicates that goodwill is impaired, the carrying value of goodwill is written down to fair value. Each of the reporting units were reviewed for impairment using a quantitative assessment as of March 31, 2020. To estimate the fair value of each reporting unit when performing the quantitative testing, the Company utilizes a weighting of the income method and the market method. The income method is based on a discounted future cash flow analysis that uses a number of inputs, including: • actual and forecasted revenue growth rates and operating margins, and • discount rates based on the reporting unit's weighted average cost of capital. The Company corroborates the reasonableness of the inputs and outcomes of our discounted cash flow analysis through a market capitalization reconciliation to determine whether the implied control premium is reasonable. The Company completed its annual goodwill impairment test in the fourth quarter of each year, as of March 31 st . In fiscal 2020, the Company elected to perform quantitative impairment tests for all goodwill reporting units and other indefinite-lived intangible assets. In performing the quantitative impairment test, the Company determined that the fair value of the North America and International reporting units exceeded the carrying amount and, as such, these reporting units were not impaired. Our assessment of the Retail and Maharam reporting units indicated that the carrying value of these reporting units exceeded their fair values, and goodwill impairment charges of $88.8 million and $36.7 million , respectively, were recorded in fiscal 2020 resulting in no goodwill in either the Retail or Maharam reporting units. The fair value of the Company's International reporting unit, which includes $163.7 million of goodwill as of May 30, 2020, exceeds its carrying value by 17% . Due to the level that the reporting unit fair value exceeded the carrying amount and the results of the sensitivity analysis, the Company may need to record an impairment charge if the operating results of its International reporting unit were to decline in future periods. In completing our annual goodwill impairment test, the respective fair values were estimated using an income approach with market participant discount rates ranging from 10.25% to 14.0% developed using a weighted average cost of capital analysis and long-term growth rates ranging from 2.5% to 3.0% . Intangible assets with indefinite useful lives are not subject to amortization and are evaluated annually for impairment, or more frequently, when events or changes in circumstances indicate that the fair value of an intangible asset may not be recoverable. The Company utilizes the relief from royalty methodology to test for impairment. The primary assumptions for the relief from royalty method include forecasted revenue growth rates, royalty rates and discount rates. The Company measures and records an impairment loss for the excess of the carrying value of the asset over its fair value. In fiscal 2020, the Company performed quantitative assessments in testing indefinite-lived intangible assets for impairment, which resulted in the carrying values of the DWR, Maharam, HAY and naughtone trade names exceeding their fair values by $53.3 million , and impairment charges of this amount were recognized. If the residual cash flows related to these trade names were to decline in future periods, the Company may need to record an additional impairment charge. In completing our annual indefinite-lived trade name impairment test, the respective fair values were estimated using a relief-from-royalty approach, applying market participant discount rates ranging from 12.75% to 17.25% developed using a weighted average cost of capital analysis, royalty rates ranging from 1.00% to 3.00% and long-term growth rates ranging from 2.5% to 3.0% . The table below summarizes the carrying values and impairment charges recorded as of and for the fiscal year ended May 30, 2020 , for each of the Company’s indefinite-lived trade names: (In millions) Trade name Carrying Value Impairment Charge Maharam $ 16.5 $ (6.5 ) DWR 31.5 (23.6 ) HAY 39.3 (20.7 ) naughtone 6.0 (2.5 ) Total $ 93.3 $ (53.3 ) The goodwill and indefinite-lived trade name impairment charges were primarily caused by reduced sales and profitability projections, largely attributable to the COVID-19 pandemic and related economic disruption that the Company began to experience in the fourth quarter of fiscal 2020. Property, Equipment and Depreciation Property and equipment are stated at cost. The cost is depreciated over the estimated useful lives of the assets using the straight-line method. Estimated useful lives range from 3 to 10 years for machinery and equipment and do not exceed 40 years for buildings. Leasehold improvements are depreciated over the lesser of the lease term or the useful life of the asset. The Company capitalizes certain costs incurred in connection with the development, testing and installation of software for internal use and cloud computing arrangements. Software for internal use is included in property and equipment and is depreciated over an estimated useful life not exceeding 5 years. Depreciation and amortization expense is included in the Consolidated Statements of Comprehensive Income in the Cost of sales, Selling, general and administrative and Design and research line items. The following table summarizes our property as of the dates indicated: (In millions) May 30, 2020 June 1, 2019 Land and improvements $ 23.7 $ 24.2 Buildings and improvements 266.5 267.6 Machinery and equipment 791.9 733.0 Construction in progress 29.2 59.9 Accumulated depreciation (780.5 ) (736.1 ) Property and equipment, net $ 330.8 $ 348.6 As of the end of fiscal 2020 , outstanding commitments for future capital purchases approximated $39.8 million . Other Long-Lived Assets The Company reviews the carrying value of long–lived assets for impairment when events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. If such indicators are present, the future undiscounted cash flows attributable to the asset or asset group are compared to the carrying value of the asset or asset group. Given the substantial reduction in forecasted revenue growth rates and cash flows due to the COVID-19 pandemic, the Company determined that a triggering event occurred in the fourth quarter of 2020 and an impairment assessment was warranted for certain asset groups. Accordingly, the Company compared the fair value of the asset groups to the carrying value of the asset groups. Based on this assessment, the Company recorded long-lived asset impairment charges of $26.6 million , primarily related to its right-of-use assets and definite-lived customer relationship intangible assets within the DWR asset group. The carrying value of the DWR asset group as of May 30, 2020 was $122.7 million . The Company used available market-based rental comparatives and industry data trends, as well as considerations of the remaining lease term, to determine the fair value of DWR’s right of use assets. As a result, the Company determined that the carrying value for the right-of-use assets within the DWR asset group exceeded their fair value and an impairment charge of $19.3 million was recorded. The carrying value of the DWR right of use assets at May 30, 2020 is $110.9 million . If the residual cash flows related to these long-lived assets were to decline in future periods, the Company may need to record an additional impairment charge. Amortizable intangible assets within Other amortizable intangibles, net in the Consolidated Balance Sheets consist primarily of patents, trademarks and customer relationships. The customer relationships intangible asset is comprised of relationships with customers, specifiers, networks, dealers and distributors. Refer to the following table for the combined gross carrying value and accumulated amortization for these amortizable intangibles. May 30, 2020 (In millions) Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 41.7 $ 118.7 $ 14.7 $ 175.1 Accumulated amortization 14.4 38.3 10.0 62.7 Net $ 27.3 $ 80.4 $ 4.7 $ 112.4 June 1, 2019 Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 20.1 $ 55.2 $ 12.0 $ 87.3 Accumulated amortization 12.5 27.6 6.1 46.2 Net $ 7.6 $ 27.6 $ 5.9 $ 41.1 The Company amortizes these assets over their remaining useful lives using the straight-line method over periods ranging from 5 years to 20 years , or on an accelerated basis, to reflect the expected realization of the economic benefits. It is estimated that the weighted-average remaining useful life of the patents and trademarks is approximately 7 years and the weighted-average remaining useful life of the customer relationships is 7 years . Estimated amortization expense on existing amortizable intangible assets as of May 30, 2020 , for each of the succeeding five fiscal years, is as follows: (In millions) 2021 $ 14.9 2022 $ 14.9 2023 $ 14.4 2024 $ 14.2 2025 $ 13.3 Self-Insurance The Company is partially self-insured for general liability, workers' compensation and certain employee health and dental benefits under insurance arrangements that provide for third-party coverage of claims exceeding the Company's loss retention levels. The Company's health benefit and auto liability retention levels do not include an aggregate stop loss policy. The Company's retention levels designated within significant insurance arrangements as of May 30, 2020 , ar e as follows: (In millions) Retention Level (per occurrence) General liability $ 1.00 Auto liability $ 1.00 Workers' compensation $ 0.75 Health benefit $ 0.50 The Company accrues for its self-insurance arrangements, as well as reserves for health, prescription drugs, and dental benefit exposures based on actuarially-determined estimates, which are recorded in “Other liabilities” in the Consolidated Balance Sheets. The value of the liability as of May 30, 2020 and June 1, 2019 was $13.1 million and $11.7 million , respectively. The actuarial valuations are based on historical information along with certain assumptions about future events. Changes in assumptions for such matters as legal actions, medical costs, payment lag times and changes in actual experience could cause these estimates to change. The general, auto, and workers' compensation liabilities are managed through the Company's wholly-owned insurance captive. Research, Development and Other Related Costs Research, development, pre-production and start-up costs are expensed as incurred. Research and development ("R&D") costs consist of expenditures incurred during the course of planned research and investigation aimed at discovery of new knowledge useful in developing new products or processes. R&D costs also include the enhancement of existing products or production processes and the implementation of such through design, testing of product alternatives or construction of prototypes. R&D costs included in “ Design and research ” expense in the accompanying Consolidated Statements of Comprehensive Income are $54.3 million , $58.8 million and $57.1 million , in fiscal 2020 , 2019 , and 2018 , respectively. Royalty payments made to designers of the Company's products as the products are sold are variable costs based on product sales. These expenses totaled $19.7 million , $18.1 million and $16.0 million in fiscal years 2020 , 2019 and 2018 respectively. They are included in Design and research expense in the accompanying Consolidated Statements of Comprehensive Income . Customer Payments and Incentives We offer various sales incentive programs to our customers, such as rebates and discounts. Programs such as rebates and discounts are adjustments to the selling price and are therefore characterized as a reduction to net sales. Revenue Recognition The Company recognizes revenue when performance obligations, based on the terms of customer contracts, are satisfied. This happens when control of goods and services based on the contract have been conveyed to the customer. Revenue for the sale of products is typically recognized at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. Revenue for services, including the installation of products by the Company's owned dealers, is recognized over time as the services are provided. The method of revenue recognition may vary, depending on the type of contract with the customer, as noted in the section "Disaggregated Revenue" in Note 2 of the Consolidated Financial Statements . The Company's contracts with customers include master agreements and certain other forms of contracts, which do not reach the level of a performance obligation until a purchase order is received from a customer. At the point in time that a purchase order under a contract is received by the Company, the collective group of documents represent an enforceable contract between the Company and the customer. While certain customer contracts may have a duration of greater than a year, all purchase orders are less than a year in duration. As of May 30, 2020 , all unfulfilled performance obligations are expected to be fulfilled in the next twelve months. Variable consideration exists within certain contracts that the Company has with customers. When variable consideration is present in a contract with a customer, the Company estimates the amount that should be included in the transaction price utilizing either the expected value method or the most likely amount method, depending on the nature of the variable consideration. These estimates are primarily related to rebate programs which involve estimating future sales amounts and rebate percentages to use in the determination of transaction price. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Adjustments to Net sales from changes in variable consideration related to performance obligations completed in previous periods are not material to the Company's financial statements. Also, the Company has no contracts with significant financing components. The Company accounts for shipping and handling activities as fulfillment activities and these costs are accrued within Cost of sales at the same time revenue is recognized. The Company does not record revenue for sales tax, value added tax or other taxes that are collected on behalf of government entities. The Company’s revenue is recorded net of these taxes as they are passed through to the relevant government entities. The Company has recognized incremental costs to obtain a contract as an expense when incurred as the amortization period is less than one year. The Company has not adjusted the amount of consideration to be received for any significant financing components as the Company’s contracts have a duration of one year or less. Leases The Company adopted ASC 842 - Leases at the beginning of fiscal year 2020. The new standard required the Company to recognize most leases on the balance sheet as right of use (ROU) assets with corresponding lease liabilities. All necessary changes required by the new standard, including those to the Company’s accounting policies, business processes, systems, controls and disclosures, were implemented as of the first quarter of fiscal year 2020. See Note 7 of the Consolidated Financial Statements for further information regarding the Company's lease accounting policies. Cost of Sales The Company includes material, labor and overhead in cost of sales. Included within these categories are items such as freight charges, warehousing costs, internal transfer costs and other costs of its distribution network. Selling, General and Administrative The Company includes costs not directly related to the manufacturing of its products in the Selling, general and administrative line item within the Consolidated Statements of Comprehensive Income. Included in these expenses are items such as compensation expense, rental expense, warranty expense and travel and entertainment expense. Income Taxes Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The Company's annual effective tax rate is based on income, statutory tax rates and tax planning strategies available in the various jurisdictions the Company operates. Complex tax laws can be subject to different interpretations by the Company and the respective government authorities. Significant judgment is required in evaluating tax positions and determining our tax expense. Tax positions are reviewed quarterly and tax assets and liabilities are adjusted as new information becomes available. In evaluating the Company's ability to recover deferred tax assets within the jurisdiction from which they arise, the Company considers all positive and negative evidence. These assumptions require significant judgment about forecasts of future taxable income. Stock-Based Compensation The Company has several stock-based compensation plans, which are described in Note 10 of the Consolidated Financial Statements. Our policy is to expense stock-based compensation using the fair-value based method of accounting for all awards granted. Earnings per Share Basic earnings per share (EPS) excludes the dilutive effect of common shares that could potentially be issued, due to the exercise of stock options or the vesting of restricted shares and is computed by dividing net earnings by the weighted-average number of common shares outstanding for the period. Diluted EPS is computed by dividing net earnings by the sum of the weighted-averag e number of shares outstanding, plus all dilutive shares that could potentially be issued. When in a loss position, basic and diluted EPS use the same weighted-average number of shares outstanding. Refe r to Note 9 of the Consolidated Financial Statements for further information regarding the computation of EPS. Comprehensive Income Comprehensive income consists of Net earnings, Foreign currency translation adjustments, Unrealized holding gains on securities, Unrealized gains on interest rate swap agreement and Pension and post-retirement liability adjustments. Refer to Note 15 of the Consolid ated Financial Statements fo r further information regarding comprehensive income. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Fair Value The Company classifies and discloses its fair value measurements in one of the following three categories: • Level 1 — Financial instruments with unadjusted, quoted prices listed on active market exchanges. • Level 2 — Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. Financial instrument values are determined using prices for recently traded financial instruments with similar underlying terms and direct or indirect observational inputs, such as interest rates and yield curves at commonly quoted intervals. • Level 3 — Financial instruments not actively traded on a market exchange and there is little, if any, market activity. Values are determined using significant unobservable inputs or valuation techniques. See Note 12 of the Consolidated Financial Statements for the required fair value disclosures. Derivatives and Hedging The Company calculates the fair value of financial instruments using quoted market prices whenever available. The Company utilizes derivatives to manage exposures to foreign currency exchange rates and interest rate risk. The fair values of all derivatives are recognized as assets or liabilities at the balance sheet date. Changes in the fair value of these instruments are reported within " Other expense (income), net " in the Consolidated Statements of Comprehensive Income, or " Accumulated other comprehensive loss " within the Consolidated Balance Sheets, depending on the use of the derivative and whether it qualifies for hedge accounting treatment. Gains and losses on derivatives that are designated and qualify as cash flow hedging instruments are recorded in Accumulated Other Comprehensive Loss, to the extent the hedges are effective, until the underlying transactions are recognized in the Consolidated Statements of Comprehensive Income. Derivatives not designated as hedging instruments are marked-to-market at the end of each period with the results included in Consolidated Statements of Comprehensive Income. See Note 12 of the Consolidated Financial Statements for further information regarding derivatives. Recently Adopted Accounting Standards On June 2, 2019, the Company adopted Accounting Standards Update ("ASU") No. 2016-02, "Leases (Topic 842)" using the modified retrospective method. Under the updated standard, a lessee's rights and obligations under most leases, including existing and new arrangements, are recognized as assets and liabilities, respectively, on the balance sheet. Refer to Note 7 to the Consolidated Financial Statements for further information regarding the adoption of the standard. On June 2, 2019, the Company adopted ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" using the prospective method. This update amends the hedge accounting recognition and presentation with the objectives of improving the financial reporting of hedging relationships to better portray the economic results of an entity's risk management activities and simplifying the application of hedge accounting. The update expands the strategies eligible for hedge accounting, relaxes the timing requirements of hedge documentation and effectiveness assessments and permits the use of qualitative assessments on an ongoing basis to assess hedge effectiveness. The new guidance also requires new disclosures and presentation. The adoption did not have a material impact on the Company's financial statements. Refer to Note 12 to the Consolidated Financial Statements for further information. On March 1, 2020, the Company adopted ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment" using the prospective method. This update simplifies how an entity assesses goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As amended, the goodwill impairment test consists of one step comparing the fair value of a reporting unit with its carrying amount. An entity then recognizes a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The adoption was utilized in the Company's current year goodwill impairment testing. Refer above to the "Goodwill and Indefinite-lived Intangible Assets" section for further information. Recently Issued Accounting Standards Not Yet Adopted The Company is currently evaluating the impact of adopting the following relevant standards issued by the FASB: Standard Description Effective Date 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This guidance replaces the existing incurred loss impairment model with an expected loss model and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. May 31, 2020 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement This update eliminates, adds and modifies certain disclosure requirements for fair value measurements. Early adoption is permitted. May 31, 2020 2018-14 Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans This update eliminates, adds and clarifies certain disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans. Early adoption is permitted. May 30, 2021 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes This update removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The update also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. Early adoption is permitted. May 30, 2021 All other issued and not yet effective accounting standards are not relevant to the Company. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
May 30, 2020 | |
Revenue from Contracts with Customers [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Disaggregated Revenue The Company’s revenue is comprised primarily of sales of products and installation services. Depending on the type of contract, the method of accounting and timing of revenue recognition may differ. Below, descriptions have been provided that summarize the Company’s different types of contracts and how revenue is recognized for each. • Single Performance Obligation - these contracts are transacted with customers and include only the product performance obligation. Most commonly, these contracts represent master agreements with independent third-party dealers in which a purchase order represents the customer contract, point of sale transactions through the Retail segment, as well as customer purchase orders for the Maharam subsidiary within the North America Contract segment. For contracts that include a single performance obligation, the Company records revenue at the point in time when title and risk of loss has transferred to the customer. • Multiple Performance Obligations - these contracts are transacted with customers and include more than one performance obligation; products, which are shipped to the customer by the Company and installation and other services, which are primarily fulfilled by independent third-party dealers. For contracts that include multiple performance obligations, the Company records revenue for the product performance obligation at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. In most cases, the Company has concluded that it is the agent for the installation services performance obligation and as such, the revenue and costs of these services are recorded net within Net sales in the Company’s Consolidated Statements of Comprehensive Income. In certain instances, entities owned by the Company, rather than independent third-party dealers, perform installation and other services. In these cases, Service revenue is generated by the Company’s entities that provide installation services, which include owned dealers, and is recognized by the Company over time as the services are provided. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation based on relative standalone selling prices. • Other - these contracts are comprised mainly of alliance fee arrangements, whereby the Company earns revenue for allowing other furniture sellers access to its dealer distribution channel, as well as other miscellaneous selling arrangements. Revenue from alliance contracts are recorded at the point in time in which the sale is made by other furniture sellers through the Company’s sales channel. Revenue disaggregated by contract type has been provided in the table below: Year Ended (In millions) May 30, 2020 June 1, 2019 Net Sales: Single performance obligation Product revenue $ 2,116.6 $ 2,155.0 Multiple performance obligations Product revenue 347.8 390.0 Service revenue 9.7 12.6 Other 12.5 9.6 Total $ 2,486.6 $ 2,567.2 Revenue disaggregated by product type and segment has been provided in the table below: Year Ended (In millions) May 30, 2020 June 1, 2019 North America Contract: Systems $ 512.7 $ 564.4 Seating 459.1 501.8 Freestanding and storage 379.8 384.9 Textiles 138.8 113.8 Other 107.8 121.6 Total North America Contract $ 1,598.2 $ 1,686.5 International Contract: Systems $ 76.6 $ 103.6 Seating 321.2 276.1 Freestanding and storage 51.1 53.0 Other 53.9 59.5 Total International Contract $ 502.8 $ 492.2 Retail: Seating $ 261.3 $ 235.6 Freestanding and storage 66.0 67.5 Other 58.3 85.4 Total Retail $ 385.6 $ 388.5 Total $ 2,486.6 $ 2,567.2 Refer to Note 14 of the Consolidated Financial Statements for further information related to our segments. Contract Assets and Contract Liabilities The Company records contract assets and contract liabilities related to its revenue generating activities. Contract assets include certain receivables from customers that are unconditional as all performance obligations with respect to the contract with the customer have been completed. These amounts represent trade receivables and they are recorded within the caption “Accounts receivable, net” in the Consolidated Balance Sheets. Contract assets also include amounts that are conditional because certain performance obligations in contracts with customers are incomplete as of the balance sheet date. These contract assets generally arise due to contracts with customers that include multiple performance obligations, e.g., both the product that is shipped to the customer by the Company, as well as installation services provided by independent third-party dealers. For these contracts, the Company recognizes revenue upon satisfaction of the product performance obligation. These contract assets are included in the caption "Unbilled accounts receivable" in the Consolidated Balance Sheets until all performance obligations in the contract with the customer have been satisfied. Contract liabilities represent deposits made by customers before the satisfaction of performance obligation and recognition of revenue. Upon completion of the performance obligation(s) that the Company has with the customer based on the terms of the contract, the liability for the customer deposit is relieved and revenue is recognized. These customer deposits are included within the caption “Customer deposits” in the Consolidated Balance Sheets. During the year ended May 30, 2020 , the Company recognized Net sales of $27.7 million related to customer deposits that were included in the balance sheet as of June 1, 2019 . |
Acquisitions and Divestitures
Acquisitions and Divestitures | 12 Months Ended |
May 30, 2020 | |
Business Combinations [Abstract] | |
Acquisitions and Divestitures | Acquisitions and Divestitures Contract Furniture Dealerships On July 31, 2017, the Company completed the sale of a wholly-owned contract furniture dealership in Vancouver, Canada for initial cash consideration of $2.0 million . A pre-tax gain of $1.1 million was recognized as a result of the sale within the caption Selling, general and administrative within the Consolidated Statements of Comprehensive Income. Maars Holding B.V. On August 31, 2018, the Company acquired 48.2% of the outstanding equity of Global Holdings Netherlands B.V., which owns 100% of Maars Holding B.V. ("Maars”), a Harderwijk, Netherlands-based worldwide leader in the design and manufacturing of interior wall solutions. The Company acquired its 48.2% ownership interest in Maars for approximately $6.1 million in cash. The entity is accounted for using the equity method of accounting as the Company has significant influence, but not control, over the entity. For the Maars equity method investment, the fair values assigned to the assets acquired were based on best estimates and assumptions as of August 31, 2018, and the valuation analysis was completed in the fourth quarter of fiscal 2019. Nine United Denmark A/S On June 7, 2018, the Company acquired 33% of the outstanding equity of Nine United Denmark A/S, d/b/a HAY and subsequently renamed to HAY ApS ("HAY”), a Copenhagen, Denmark-based, design leader in furniture and ancillary furnishings for residential and contract markets in Europe and Asia. The Company acquired its 33% ownership interest in HAY for approximately $65.5 million in cash. The Company also acquired the rights to the HAY brand in North America under a long-term license agreement for approximately $4.8 million in cash. In the fiscal periods leading up to December 2, 2019 (“Acquisition Date”), the date when the Company purchased an additional 34% equity voting interest in HAY, this licensing agreement was recorded as a definite life intangible asset and was being amortized over its 15-year useful life. This asset was also recorded within Other amortizable intangibles, net within the Condensed Consolidated Balance Sheets as of June 1, 2019 . On December 2, 2019, the Company obtained a controlling financial interest in HAY through the purchase of an additional 34% equity voting interest. The completion of the acquisition will allow the Company to further promote growth and development of HAY's ancillary product lines and continue to support product innovation and sales growth. The Company previously accounted for its ownership interest in HAY as an equity method investment, but upon increasing its ownership to 67% on the Acquisition Date, the Company consolidated the operations of HAY. Total consideration paid for HAY on the Acquisition Date was $79.0 million , exclusive of HAY cash on hand. The Company funded the acquisition with cash and cash equivalents. The previously mentioned HAY long-term licensing agreement was deemed to be a contractual preexisting relationship. As a result of the business combination, the Company recorded this arrangement at its Acquisition Date fair value, which resulted in an increase in goodwill of $10.0 million and a net gain of $5.9 million , which was recorded within “Gain on consolidation of equity method investments" within the Consolidated Statements of Comprehensive Income. The goodwill was recorded within the Company’s Retail segment. T he Company is a party to options, that if exercised, would require it to purchase the remaining 33% of the equity in HAY, at fair market value. This remaining redeemable noncontrolling interest in HAY is classified outside permanent equity in the Consolidated Balance Sheets and is carried at the current estimated redemption amount. The Company is in the process of finalizing assessments for the purpose of allocating the purchase price to the individual assets acquired and liabilities assumed in the HAY acquisition. This has the potential to result in adjustments to the carrying values of certain assets and liabilities as accounting policies are harmonized and purchase price allocation assumptions are updated. The refinement of these estimates may impact residual amounts allocated to goodwill. The preliminary allocation of the purchase prices included in the current period balance sheet is based on the best estimates of management and is subject to revision based on final determination of asset fair values and useful lives. As of May 30, 2020 , the Company is in the process of finalizing the value associated with certain tax-related matters. The following table presents the preliminary allocation of purchase price related to acquired tangible assets: (In millions) Cash $ 12.1 Working capital, net of cash and inventory step-up 12.3 Net property and equipment 0.9 Other assets 3.9 Other liabilities (3.1 ) Net assets acquired $ 26.1 The purchase of the additional equity interest in HAY was considered to be an acquisition achieved in stages, whereby the previously held equity interest was remeasured as of the acquisition date. The Company considered multiple factors in determining the fair value of the previously held equity method investment, including the price negotiated with the selling shareholder for the 34% equity interest in HAY, an income valuation model (discounted cash flow) and current trading multiples for comparable companies. Based on this analysis, the Company recognized a non-taxable gain of approximately $0.3 million on the remeasurement of the previously held equity method investment of $67.8 million . The net gain has been recognized in “Gain on consolidation of equity method investments" within the Consolidated Statements of Comprehensive Income. The following table summarizes the acquired identified intangible assets, valuation method employed, useful lives and fair value, as determined by the Company at the acquisition date. A djustments were made to the fair value of the identified intangible assets during the measurement period ended May 30, 2020 as shown in the table below. Goodwill related to the acquisition was recorded in the amount of $111.1 million and included deferred tax liabilities of $26.2 million , an increase of $6.3 million and $0.9 million , respectively, during the measurement period ended May 30, 2020 . The changes in fair value of goodwill and the identified intangible assets were due to refinements in the projected cash flow estimates of the individual intangible assets acquired. Acquisition Date Fair Value (In millions) Valuation Method Useful Life (years) Initial Valuation at February 29, 2020 Adjusted Valuation at May 30, 2020 Measurement Period Adjustments Inventory Step-up Comparative Sales Approach 0.8 $ 3.4 $ 3.4 $ — Backlog Multi-Period Excess Earnings 0.3 3.4 1.7 (1.7 ) Deferred Revenue Adjusted Fulfillment Cost Method 0.1 (2.0 ) (2.2 ) (0.2 ) Tradename Relief from Royalty Indefinite 56.0 60.0 4.0 Product Development Relief from Royalty 8.0 21.0 22.0 1.0 Customer Relationships Multi-Period Excess Earnings 9.0 33.0 34.0 1.0 Total $ 114.8 $ 118.9 $ 4.1 Goodwill related to the acquisition was recorded within the International Contract segment for $101.1 million and the Retail segment for $10.0 million . naughtone On October 25, 2019 (“Acquisition Date”), the Company purchased the remaining 47.5% equity voting interest in naughtone (Holdings) Limited and naughtone Manufacturing Ltd. (together “naughtone”). naughtone is an upscale, contemporary furniture manufacturer based in Harrogate, North Yorkshire, UK. The completion of the acquisition will allow the Company to further promote growth and development of naughtone's ancillary product lines, and continue to support product innovation and sales growth. The Company previously accounted for its ownership interest in naughtone as an equity method investment. Upon increasing its ownership to 100% on the acquisition date, the Company obtained a controlling financial interest and consolidated the operations of naughtone. Total consideration paid for naughtone on the Acquisition Date was $45.9 million , exclusive of naughtone cash on hand. The Company funded the acquisition with cash and cash equivalents. The allocation of the purchase price was finalized during the fourth quarter of fiscal 2020. The following table presents the allocation of purchase price related to acquired tangible assets: (In millions) Cash $ 5.1 Working capital, net of cash and inventory step-up 1.3 Net property and equipment 0.8 Net assets acquired $ 7.2 The purchase of the remaining equity interest in naughtone was considered to be an acquisition achieved in stages, whereby the previously held equity interest was remeasured as of the acquisition date. The Company considered multiple factors in determining the fair value of the previously held equity method investment, including the price negotiated with the selling shareholder for the 47.5% equity interest in naughtone, an income valuation model (discounted cash flow) and current trading multiples for comparable companies. Based on this analysis, the Company recognized a non-taxable gain of approximately $30.0 million on the remeasurement of the previously held equity method investment of $20.5 million . The net gain has been recognized in “Gain on consolidation of equity method investments" within the Consolidated Statements of Comprehensive Income. The following table summarizes the acquired identified intangible assets, valuation method employed, useful lives and fair value, as determined by the Company at the acquisition date: (In millions) Valuation Method Useful Life (years) Fair Value Inventory Step-up Comparative Sales Approach 0.3 $ 0.2 Backlog Multi-Period Excess Earnings 0.3 0.8 Tradename Relief from Royalty Indefinite 8.5 Customer Relationships Multi-Period Excess Earnings 9.0 29.4 Total $ 38.9 Goodwill related to the acquisition was recorded within the North America Contract and International Contract segments for $35.0 million and $22.5 million , respectively. The Company has finalized allocating the purchase price to the individual assets acquired and liabilities assumed in the naughtone acquisition as of May 30, 2020. Pro Forma Results of Operations The results of naughtone and HAY’s operations have been included in the Consolidated Financial Statements beginning on October 25, 2019 and December 2, 2019 respectively. The following table provides pro forma results of operations for the years ended May 30, 2020 and June 1, 2019 , as if naughtone and HAY had been acquired as of June 3, 2018. The pro forma results include certain purchase accounting adjustments such as the estimated change in depreciation and amortization expense on the acquired tangible and intangible assets acquired. Pro forma results do not include any anticipated cost savings from the planned integration of these acquisitions, or the gain on the consolidation of the HAY and naughtone equity method investments of approximately $36.2 million . Accordingly, such amounts are not necessarily indicative of the results that would have occurred if the acquisition had occurred on the dates indicated or that may result in the future and are inclusive of pre-tax impairment charges of $205.4 million in the year-end May 30, 2020. Year Ended (In millions) May 30, 2020 June 1, 2019 Net sales $ 2,580.6 $ 2,757.3 Net (loss) earnings attributable to Herman Miller, Inc. $ (46.3 ) $ 163.7 |
Inventories
Inventories | 12 Months Ended |
May 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure | Inventories (In millions) May 30, 2020 June 1, 2019 Finished goods and work in process $ 151.1 $ 139.1 Raw materials 46.2 45.1 Total $ 197.3 $ 184.2 Inventories valued using LIFO amounted to $ 24.9 million and $ 26.5 million as of May 30, 2020 and June 1, 2019 , respectively. If all inventories had been valued using the first-in first-out method, inventories would have been $ 210.8 million and $ 198.0 million at May 30, 2020 and June 1, 2019 , respectively. |
Investments in Nonconsolidated
Investments in Nonconsolidated Affiliates | 12 Months Ended |
May 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments in Nonconsolidated Affiliates | Investments in Nonconsolidated Affiliates The Company has certain investments in entities that are accounted for using the equity method (“nonconsolidated affiliates”). The investments are included in " Other noncurrent assets " in the Consolidated Balance Sheets and the equity earnings are included in " Equity earnings from nonconsolidated affiliates, net of tax " in the Consolidated Statements of Comprehensive Income. Refer to the tables below for the investment balances that are included in the Consolidated Balance Sheets and for the equity earnings that are included in the Consolidated Statements of Comprehensive Income. (In millions) May 30, 2020 June 1, 2019 Investments in nonconsolidated affiliates $ 12.2 $ 89.0 (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Equity earnings from nonconsolidated affiliates, net of tax $ 5.0 $ 5.0 $ 3.0 The Company had an ownership interest in five nonconsolidated affiliates at May 30, 2020 . Refer to the Company's ownership percentages shown below: Ownership Interest May 30, 2020 June 1, 2019 Kvadrat Maharam Arabia DMCC 50.0% 50.0% Kvadrat Maharam Pty Limited 50.0% 50.0% Kvadrat Maharam Turkey JSC 50.0% 50.0% Danskina B.V. 50.0% 50.0% Global Holdings Netherlands B.V. 48.2% 48.2% Kvadrat Maharam The Kvadrat Maharam nonconsolidated affiliates are distribution entities that are engaged in selling decorative upholstery, drapery and wall covering products. At May 30, 2020 and June 1, 2019 , the Company's investment value in Kvadrat Maharam Pty was $1.7 million and $ 1.8 million more than the Company's proportionate share of the underlying net assets, respectively. This difference was driven by a step-up in fair value of the investment in Kvadrat Maharam Pty, stemming from the Maharam business combination. This amount is considered to be a permanent basis difference. In fiscal 2020 the Company agreed to fully divest its interest in Kvadrat Maharam Arabia DMCC, Kvadrat Maharam Turkey JSC and Danskina B.V for approximately $3 million . The divestitures are expected to be completed by the end of the first half of fiscal 2021. Maars On August 31, 2018, the Company acquired 48.2% of the outstanding equity of Global Holdings Netherlands B.V., which owns 100% of Maars Holding B.V. ("Maars”), a Harderwijk, Netherlands-based worldwide leader in the design and manufacturing of interior wall solutions. The Company acquired its 48.2% ownership interest in Maars for approximately $6.1 million in cash. The entity is accounted for using the equity method of accounting as the Company has significant influence, but not control, over the entity. As of the August 31, 2018 acquisition date, the Company's investment value in Maars was $3.1 million more than the Company's proportionate share of the underlying net assets. This amount represented the difference between the price that the Company paid to acquire 48.2% of the outstanding equity and the carrying value of the net assets of Maars. Of this difference, $2.7 million was being amortized over the remaining useful lives of the assets, while $0.4 million was considered a permanent difference. At May 30, 2020 , the Company's investment value in Maars was $2.5 million more than the Company's proportionate share of the underlying net assets, of which $2.1 million was being amortized over the remaining useful lives of the assets, while $0.4 million was considered a permanent basis difference. naughtone & HAY As described in Note 3 to the Consolidated Financial Statements, the Company increased its investment in both naughtone & HAY during the year ended May 30, 2020 and obtained a controlling financial interest over each entity. As a result, these two entities, which were previously accounted for as equity method investments, are now included within the Company's consolidated operations. Transactions with Nonconsolidated Affiliates Sales to and purchases from nonconsolidated affiliates were as follows for the periods presented below: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Sales to nonconsolidated affiliates $ 3.6 $ 3.9 $ 4.3 Purchases from nonconsolidated affiliates $ 5.0 $ 23.0 $ 6.8 Balances due to or due from nonconsolidated affiliates were as follows for the periods presented below: (In millions) May 30, 2020 June 1, 2019 Receivables from nonconsolidated affiliates $ 0.6 $ 0.7 Payables to nonconsolidated affiliates $ — $ 1.2 |
Short-Term Borrowings and Long-
Short-Term Borrowings and Long-Term Debt | 12 Months Ended |
May 30, 2020 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings and Long-Term Debt | Short-Term Borrowings and Long-Term Debt Long-term debt consisted of the following obligations: (In millions) May 30, 2020 June 1, 2019 Debt securities, 6.0%, due March 1, 2021 $ 50.0 $ 50.0 Debt securities, 4.95%, due May 20, 2030 49.9 — Syndicated Revolving Line of Credit, due August 2024 490.0 225.0 Construction-Type Lease — 6.9 Supplier financing program 1.4 3.1 Total debt $ 591.3 $ 285.0 Less: Current debt (51.4 ) (3.1 ) Long-term debt $ 539.9 $ 281.9 As of June 1, 2019 , the Company's syndicated revolving line of credit provided the Company with up to $400 million in revolving variable interest borrowing capacity and included an "accordion feature" allowing the Company to increase, at its option and subject to the approval of the participating banks, the aggregate borrowing capacity of the facility by up to $200 million . On August 28, 2019, the Company entered into an amendment and restatement of its existing unsecured credit facility (the "Agreement"). The Agreement, which expires on August 28, 2024, provides the Company with up to $500 million in revolving variable interest borrowing capacity and includes an "accordion feature" allowing the Company to increase, at its option and subject to the approval of the participating banks, the aggregate borrowing capacity of the facility by up to $250 million . Outstanding borrowings bear interest at rates based on the prime rate, federal funds rate, LIBOR or negotiated rates as outlined in the agreement. Interest is payable periodically throughout the period if borrowings are outstanding. In March 2020, the Company borrowed an additional $265 million from its syndicated revolving line of credit as a precautionary measure to provide additional near-term liquidity given the uncertainty related to COVID-19, which was subsequently repaid in June 2020. Available borrowings under the syndicated revolving line of credit were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 Syndicated revolving line of credit borrowing capacity $ 500.0 $ 400.0 Less: Borrowings under the syndicated revolving line of credit 490.0 225.0 Less: Outstanding letters of credit 9.4 10.0 Available borrowings under the syndicated revolving line of credit $ 0.6 $ 165.0 The unsecured senior revolving credit facility restrict, without prior consent, the Company's borrowings, capital leases and the sale of certain assets. In addition, the Company has agreed to maintain certain financial performance ratios, which include a maximum leverage ratio covenant, which is measured by the ratio of debt to trailing four quarter adjusted EBITDA (as defined in the credit agreement) and is required to be less than 3.5 :1, except that the Company may elect, under certain conditions, to increase the maximum Leverage Ratio to 4 :1 for four consecutive fiscal quarter end dates. The covenants also require a minimum interest coverage ratio, which is measured by the ratio of trailing four quarter EBITDA to trailing four quarter interest expense (as defined in the credit agreement) and is required to be greater than 3.5 :1. Adjusted EBITDA is generally defined in the credit agreement as EBITDA adjusted by certain items which include non-cash share-based compensation, non-recurring restructuring costs and extraordinary items. At May 30, 2020 and June 1, 2019 , the Company was in compliance with all of these restrictions and performance ratios. On May 20, 2020, the Company entered into a third amendment to its existing Private Shelf Agreement, dated December 14, 2010, as amended (together with the third amendment, the "Agreement"), between the Company and PGIM, Inc. (formerly known as Prudential Investment Management, Inc.) and certain of its affiliates (collectively, “Prudential”). The Agreement provides for a $150.0 million revolving facility, which includes $50.0 million of outstanding existing unsecured senior notes that are due on March 1, 2021 (the "Existing Notes") and an additional $50.0 million aggregate principal amount of unsecured senior notes issued on May 20, 2020 (the "2020 Notes"). The 2020 Notes are due on May 20, 2030 and bear interest at a fixed annual coupon rate of 4.95% . The Company intends to use the proceeds of the 2020 Notes for general corporate purposes and/or to refinance existing indebtedness, including the Existing Notes. The Agreement also establishes an uncommitted shelf facility (the “Facility”), under which Prudential will consider one or more requests from the Company to purchase up to an additional $50.0 million in aggregate amount of the Company’s senior unsecured notes from time to time. The interest rate on any future notes issued under the Facility will be based on the benchmark Treasury rate corresponding to the weighted average life of the notes, plus a spread as determined by Prudential. The Facility will expire on May 20, 2023. Annual maturities of debt for the five fiscal years subsequent to May 30, 2020 are as shown in the table below. (In millions) 2021 $ 51.4 2022 $ — 2023 $ — 2024 $ — 2025 $ 490.0 Thereafter $ 50.0 Supplier Financing Program The Company has an agreement with a third-party financial institution that allows certain participating suppliers the ability to finance payment obligations from the Company. Under this program, participating suppliers may finance payment obligations of the Company, prior to their scheduled due dates, at a discounted price to the third-party financial institution. The Company has lengthened the payment terms for certain suppliers that have chosen to participate in the program. As a result, certain amounts due to suppliers have payment terms that are longer than standard industry practice and as such, these amounts have been excluded from the caption “Accounts payable” in the Condensed Consolidated Balance Sheets as the amounts have been accounted for by the Company as a current debt obligation. Accordingly, $1.4 million and $3.1 million have been recorded within the caption “ Short-term borrowings and current portion of long-term debt ” for the periods ended May 30, 2020 and June 1, 2019 , respectively. Construction-Type Lease During fiscal 2015, the Company entered into a lease agreement for the occupancy of a new studio facility in Palo Alto, California which runs through fiscal 2026. In fiscal 2017, the Company became the deemed owner of the leased building for accounting purposes as a result of the Company's involvement during the construction phase of the project. The lease was therefore accounted for as a financing lease and the building and related financing liability were initially recorded at fair value in the Consolidated Balance Sheets within Construction in progress and Other accrued liabilities. During the first quarter of fiscal 2019, the construction was substantially completed, and the property was placed in service. As a result, the Company began depreciating the assets over their estimated useful lives. The Company also reclassified the related financing liability to Long-term debt. The carrying value of the building was $6.7 million and the related financing liability was $6.9 million at June 1, 2019 . As a result of the adoption of ASC 842 in the first quarter of fiscal 2020, the Company derecognized its construction-type lease asset and financing liability and there was no related cumulative adjustment to retained earnings. |
Leases Leases
Leases Leases | 12 Months Ended |
May 30, 2020 | |
Leases [Abstract] | |
Leases | Leases Impact of Adoption The Company adopted ASC 842 - Leases at the beginning of fiscal year 2020. The new standard required the Company to recognize most leases on the balance sheet as right of use (ROU) assets with corresponding lease liabilities. All necessary changes required by the new standard, including those to the Company’s accounting policies, business processes, systems, controls and disclosures were implemented as of the first quarter of fiscal year 2020. As part of the implementation process the Company made the following elections: • The Company elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs for all leases. • The Company elected to make the accounting policy election for short-term leases resulting in lease costs being recorded as an expense on a straight-line basis over the lease term. • The Company elected to not separate lease and non-lease components, for all leases. • The Company did not elect the hindsight practical expedient in determining the lease term and in assessing the likelihood that a lessee purchase option will be exercised, for all leases. • The Company did not elect the land easement practical expedient in determining whether land easements that were not previously accounted for as leases are or contain a lease. Upon adoption, the cumulative effect of initially applying this new standard resulted in the addition of approximately $245 million of ROU assets, as well as corresponding short-term and long-term lease liabilities of approximately $275 million . Additionally, as a result of adoption, the Company derecognized its construction-type lease asset and financing liability and there was no related cumulative adjustment to retained earnings. Accounting Policies The Company has leases for retail studios, showrooms, manufacturing facilities, warehouses and vehicles, which expire at various dates through 2036 . Certain lease agreements include contingent rental payments based on per unit usage over a contractual amount and others include rental payments adjusted periodically for inflationary indexes. Variable lease costs associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease costs are presented as operating expenses in the Company’s Consolidated Statements of Operations and Comprehensive Income in the same line item as the expense arising from fixed lease payments for operating leases. Additionally, certain leases include renewal or termination options, which can be exercised at the Company’s discretion. Lease terms include the noncancelable portion of the underlying leases along with any reasonably certain lease periods associated with available renewal periods. The Company’s leases do not contain any residual value guarantees or material restrictive covenants. The Company determines if an arrangement is a lease at contract inception. Arrangements that are leases with an initial term of 12 months or less are not recorded in the Consolidated Balance Sheets, and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. If leased assets have leasehold improvements, the depreciable life of those leasehold improvements are limited by the expected lease term. As none of the Company’s leases provide an implicit discount rate, the Company uses an estimated incremental borrowing rate at the lease commencement date in determining the present value of the lease payments. Relevant information used in determining the Company’s incremental borrowing rate includes the duration of the lease, location of the lease, and the Company’s credit risk relative to risk-free market rates. Leases During the year ended May 30, 2020 , lease expense was $62.1 million . The components of lease expense were as follows: Year Ended (In millions) May 30, 2020 Operating lease costs $ 51.3 Short-term lease costs 2.6 Variable lease costs* 8.2 Total $ 62.1 *Not included in the table above for the year ended May 30, 2020 are variable lease costs of $81.3 million for raw material purchases under certain supply arrangements that the Company has determined to meet the definition of a lease. During the fourth quarter of fiscal 2020, the Company determined it was more likely than not that the fair value of certain right of use assets were below their carrying values and assessed these assets for impairment. As result of this assessment the Company recorded an impairment of $19.3 million in the Consolidated Statements of Comprehensive income. At May 30, 2020 , the Company has no financing leases. The undiscounted annual future minimum lease payments related to the Company's right-of-use assets are summarized by fiscal year in the following table: (In millions) 2021 $ 48.5 2022 44.8 2023 40.2 2024 34.5 2025 30.5 Thereafter 71.9 Total lease payments* 270.4 Less interest 26.5 Present value of lease liabilities $ 243.9 *Lease payments exclude $30.6 million of legally binding minimum lease payments for leases signed but not yet commenced, primarily related to a new Chicago showroom expected to open in fiscal 2021. The long-term portion of the lease liabilities included in the amounts above is $178.8 million and the remainder of the lease liabilities are included in Other accrued liabilities in the Condensed Consolidated Balance Sheets. The following table summarizes future minimum rental payments required under operating leases that have non-cancelable lease terms as of June 1, 2019 , prior to the adoption of ASC 842: (In millions) 2020 $ 51.7 2021 46.8 2022 42.9 2023 39.0 2024 33.5 Thereafter 101.9 Total $ 315.8 At May 30, 2020 , the weighted average remaining lease term and weighted average discount rate for operating leases were 7 years and 3.1% , respectively. During the year ended May 30, 2020 , the cash paid for leases included in the measurement of the liabilities and the operating cash flows was $49.2 million and the right of use assets obtained in exchange for new liabilities was $13.4 million . |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
May 30, 2020 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company maintains retirement benefit plans for substantially all of its employees. Pension Plan One of the Company's wholly owned foreign subsidiaries has a defined-benefit pension plan based upon an average final pay benefit calculation. The measurement date for this plan is the last day of the fiscal year and the plan is frozen to new participants. Benefit Obligations and Funded Status The following table presents, for the fiscal years noted, a summary of the changes in the projected benefit obligation, plan assets and funded status of the Company's pension plan: Pension Benefit (In millions) 2020 2019 Change in benefit obligation: Benefit obligation at beginning of year $ 109.1 $ 105.9 Interest cost 2.4 2.7 Plan Amendments — 0.9 Foreign exchange impact (2.9 ) (6.0 ) Actuarial loss (gain) 21.0 9.7 Benefits paid (3.1 ) (4.1 ) Benefit obligation at end of year $ 126.5 $ 109.1 Change in plan assets: Fair value of plan assets at beginning of year $ 88.2 $ 94.6 Actual return on plan assets 4.7 2.5 Foreign exchange impact (2.0 ) (5.1 ) Employer contributions 0.3 0.3 Benefits paid (3.1 ) (4.1 ) Fair value of plan assets at end of year $ 88.1 $ 88.2 Funded status: Under funded status at end of year $ (38.4 ) $ (20.9 ) Components of the amounts recognized in the Consolidated Balance Sheets: Current liabilities $ — $ — Non-current liabilities $ (38.3 ) $ (20.9 ) Components of the amounts recognized in Accumulated other comprehensive loss before the effect of income taxes: Prior service cost $ 0.7 $ 0.8 Unrecognized net actuarial loss (gain) $ 63.2 $ 47.3 Accumulated other comprehensive loss $ 63.9 $ 48.1 The accumulated benefit obligation for the Company's pension plan tota led $123.9 million and $105.4 million as of fiscal 2020 and fiscal 2019 , respectively. The following table is a summary of the annual cost of the Company's pension plan: Components of Net Periodic Benefit Costs and Other Changes Recognized in Other Comprehensive Income (Loss): (In millions) 2020 2019 2018 Interest cost $ 2.4 $ 2.7 $ 2.7 Expected return on plan assets (4.4 ) (4.5 ) (5.6 ) Amortization of prior service costs 0.1 0.1 — Amortization of net (gain)/loss 3.2 2.7 4.2 Net periodic benefit cost $ 1.3 $ 1.0 $ 1.3 Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss): (In millions) 2020 2019 Net actuarial (gain) loss $ 20.6 $ 11.7 Net amortization (4.8 ) (2.7 ) Total recognized in other comprehensive loss $ 15.8 $ 9.0 The net actuarial loss, incl uded in accumulated other comprehensive loss (pretax), expected to be recognized in net periodic benefit cost during fiscal 2021 is $ 4.9 million. Actuarial Assumptions The weighted-average actuarial assumptions used to determine the benefit obligation amounts and the net periodic benefit cost for the Company's pension plan are as follows: Weighted-average assumptions used in the determination of net periodic benefit cost: (Percentages) 2020 2019 2018 Discount rate 2.39 2.87 2.49 Compensation increase rate 3.20 3.10 3.25 Expected return on plan assets 4.80 4.80 6.10 Weighted-average assumptions used in the determination of the projected benefit obligations: Discount rate 1.66 2.39 2.87 Compensation increase rate 2.75 3.20 3.10 The Company uses a full yield curve approach to estimate the interest component of net periodic benefit cost for pension benefits. This method applies the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. Plan Assets and Investment Strategies The Company's employee benefit plan assets consist mainly of listed fixed income obligations and common/collective trusts. The Company's primary objective for invested pension plan assets is to provide for sufficient long-term growth and liquidity to satisfy all of its benefit obligations over time. Accordingly, the Company has developed an investment strategy that it believes maximizes the probability of meeting this overall objective. This strategy includes the development of a target investment allocation by asset category in order to provide guidelines for making investment decisions. This target allocation emphasizes the long-term characteristics of individual asset classes as well as the diversification among multiple asset classes. In developing its strategy, the Company considered the need to balance the varying risks associated with each asset class with the long-term nature of its benefit obligations. The Company's strategy moving forward will be to increase the level of fixed income investments as the funding status improves, thereby more closely matching the return on assets with the liabilities of the plans. The Company utilizes independent investment managers to assist with investment decisions within the overall guidelines of the investment strategy. The target asset allocation at the end of fiscal 2020 and asset categories for the Company's pension plan for fiscal 2020 and 2019 are as follows: Asset Category Targeted Asset Allocation Percentage Percentage of Plan Assets at Year End 2020 2019 2020 2019 Fixed income 35% 35% 37% 33% Common collective trusts 65% 65% 63% 67% Total 100% 100% (In millions) May 30, 2020 Asset Category Level 1 Level 2 Total Foreign government obligations — 31.4 31.4 Common collective trusts-balanced — 56.7 56.7 Total $ — $ 88.1 $ 88.1 (In millions) June 1, 2019 Asset Category Level 1 Level 2 Total Foreign government obligations — 29.3 29.3 Common collective trusts-balanced — 58.9 58.9 Total $ — $ 88.2 $ 88.2 Cash Flows The Company reviews pension funding requirements to determine the contribution to be made in the next year. Actual contributions will be dependent upon investment returns, changes in pension obligations and other economic and regulatory factors. During fiscal 2020 and fiscal 2019 , the Company made total cash contributions of $0.9 million to its benefit plans. The following represents a summary of the benefits expected to be paid by the plan in future fiscal years. These expected benefits were estimated based on the same actuarial valuation assumptions used to determine benefit obligations at May 30, 2020 . (In millions) Pension Benefits 2021 $ 2.4 2022 $ 2.4 2023 $ 2.5 2024 $ 2.5 2025 $ 2.6 2026-2030 $ 13.9 Profit Sharing, 401(k) Plan, and Core Contribution Substantially all of the Company’s domestic employees are eligible to participate in a defined contribution retirement plan, primarily the Herman Miller, Inc. profit sharing and 401(k) plan (the "plan"). Employees under the plan are eligible to begin participating on their date of hire. Effective June 2017, the Company matches 100 percent of employee contributions to their 401(k) accounts up to 3 percent of their pay which was subsequently increased to 4 percent in September 2017 for all eligible employees. A core contribution of 4 percent is also included for most participants of the plan. There was an additional 1 percent contribution added to the quarterly Core Contribution for the quarter prior to the increased Employer Matching Contribution effective September 3, 2017. During the fourth quarter of fiscal 2020, the Company elected to temporarily suspend the Company's Core Contribution and 401(k) matches in order to reduce costs and preserve liquidity. There were no Herman Miller, Inc. profit sharing contributions made in fiscal 2020 , fiscal 2019 or fiscal 2018 . The expense recorded for the Company's 401(k) matching and core contributions was $22.2 million , $25.4 million and $24.9 million in fiscal years 2020 , 2019 and 2018 , respectively. |
Common Stock and Per Share Info
Common Stock and Per Share Information | 12 Months Ended |
May 30, 2020 | |
Earnings Per Share [Abstract] | |
Common Stock and Earnings Per Share | Common Stock and Per Share Information The following table reconciles the numerators and denominators used in the calculations of basic and diluted EPS for each of the last three fiscal years: (In millions, except shares) 2020 2019 2018 Numerator: Numerator for both basic and diluted EPS, Net (loss) earnings attributable to Herman Miller, Inc. $ (9.1 ) $ 160.5 $ 128.1 Denominator: Denominator for basic EPS, weighted-average common shares outstanding 58,920,653 59,011,945 59,681,268 Potentially dilutive shares resulting from stock plans — 369,846 630,037 Denominator for diluted EPS 58,920,653 59,381,791 60,311,305 Equity awar ds of 142,224 shares , 218,037 shares and 348,089 shares of common stock were excluded from the denominator for the computation of diluted earnings per share for the fiscal years ended May 30, 2020 , June 1, 2019 and June 2, 2018 , respectively, because they were anti-dilutive. Common Stock The Company has a share repurchase plan authorized by the Board of Directors on January 16, 2019, which provides a share repurchase authorization of $ 250.0 million with no specified expiration date. The approximate dollar value of shares available for purchase under the plan at May 30, 2020 was $ 237.6 million. During fiscal year 2020 , 2019 , and 2018 , shares repurchased and retired under the current and past repurchase plans totaled 641,192 , 1,326,023 , and 1,356,156 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
May 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company utilizes equity-based compensation incentives as a component of its employee and non-employee director and officer compensation philosophy. Currently, these incentives consist principally of stock options, restricted stock, restricted stock units and performance share units. The Company also offers a stock purchase plan for its domestic and certain international employees. The Company issues shares in connection with its share-based compensation plans from authorized, but unissued, shares. At May 30, 2020 there were 5,991,307 shares authorized under the various stock-based compensation plans. Valuation and Expense Information The Company measures the cost of employee services received in exchange for an award of equity instruments based on their grant-date fair market value. This cost is recognized over the requisite service period. Certain of the Company's equity-based compensation awards contain provisions that allow for continued vesting into retirement. Stock-based awards are considered fully vested for expense attribution purposes when the employee's retention of the award is no longer contingent on providing subsequent service. The Company classifies pre-tax stock-based compensation expense primarily within Operating expenses in the Consolidated Statements of Comprehensive Income. Pre-tax compensation expense and the related income tax benefit for all types of stock-based programs were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Employee stock purchase program $ 0.3 $ 0.3 $ 0.3 Stock option plans 0.6 (0.4 ) 2.6 Restricted stock units 3.9 4.6 3.9 Performance share units (2.1 ) 2.8 0.9 Total $ 2.7 $ 7.3 $ 7.7 Tax benefit $ 0.5 $ 1.6 $ 2.3 As of May 30, 2020 , total pre-tax stock-based compensation cost not yet recognized related to non-vested awards was approximately $3.2 million . The weighted-average period over which this amount is expected to be recognized is 1.2 years. Employee Stock Purchase Program Under the terms of the Company's Employee Stock Purchase Plan, 4 million shares of authorized common stock were reserved for purchase by plan participants at 85 percent of the market price. Shares of common stock purchased under the employee stock purchase plan were 70,145 , 62,957 , and 67,335 for the fiscal years ended 2020 , 2019 and 2018 respectively. Stock Options The Company grants options to purchase the Company's stock to certain key employees and non-employee directors under its Long-Term Incentive Plan, as amended (the "LTIP") at a price not less than the market price of the Company's common stock on the date of grant. Under the current award program, all options become exercisable between one year and three years from date of grant and expire ten years from date of grant. Most options are subject to graded vesting with the related compensation expense recognized on a straight-line basis over the requisite service period. In fiscal 2020 there were no stock option grants awarded to employees or non-employee directors. In fiscal 2019 there were two separate stock option valuation dates. Therefore the table below has been presented with the assumptions relevant to each valuation date. The Company estimated the fair value of employee stock options on the date of grant using the Black-Scholes model. In determining these values, the following weighted-average assumptions were used for the options granted during the fiscal years indicated: 2020 2019 2018 Risk-free interest rates (1) N/A 2.65-2.70% 1.79 % Expected term of options (2) N/A 4.4 years 4.6 years Expected volatility (3) N/A 27 % 26 % Dividend yield (4) N/A 2.18-2.33% 2.23 % Weighted-average grant-date fair value of stock options: Granted with exercise prices equal to the fair market value of the stock on the date of grant N/A $ 8.05 $ 6.39 (1) Represents term-matched, zero-coupon risk-free rate from the Treasury Constant Maturity yield curve, continuously compounded. (2) Represents historical settlement data, using midpoint scenario with 1-year grant date filter assumption for outstanding options. (3) The blended volatility approach was used. 90% term-matched historical volatility from daily stock prices and 10% percent weighted average implied volatility from the 90 days preceding the grant date. (4) Represents the quarterly dividend divided by the three-month average stock price as of the grant date, annualized and continuously compounded. The following is a summary of the transactions under the Company's stock option plan: Shares Under Option Weighted-Average Exercise Prices Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 790,059 $ 32.17 $ 3.0 5.8 Exercised (423,815 ) $ 31.63 Forfeited or expired (4,828 ) $ 33.38 Outstanding at May 30, 2020 361,416 $ 32.80 $ 0.2 5.8 Ending vested + expected to vest 361,416 $ 32.80 $ 0.2 5.8 Exercisable at end of period 186,952 $ 29.80 $ 0.2 5.2 The weighted-average remaining recognition period of the outstanding stock options at May 30, 2020 was 1.0 years. The total pre-tax intrinsic value of options exercised during fiscal 2020 , 2019 and 2018 was $5.5 million , $3.3 million and $5.0 million , respectively. The aggregate intrinsic value in the preceding table represents the total pre-tax intrinsic value, based on the Company's closing stock price as of the end of the period presented, which would have been received by the option holders had all option holders exercised in-the-money options as of that date. Total cash received during fiscal 2020 from the exercise of stock options was approximately $12 million . Restricted Stock Units The Company grants restricted stock units to certain key employees under its LTIP. This program provides that the actual number of restricted stock units awarded is based on the value of a portion of the participant's long-term incentive compensation divided by the fair value of the Company's stock on the date of grant. The awards generally cliff-vest after a three -year service period, with prorated vesting under certain circumstances and full or partial accelerated vesting upon retirement. Each restricted stock unit represents one equivalent share of the Company's common stock to be awarded, free of restrictions, after the vesting period. Compensation expense related to these awards is recognized over the requisite service period, which includes any applicable performance period. Dividend equivalent awards are credited quarterly. The units do not entitle participants to the rights of stockholders of common stock, such as voting rights, until shares are issued after vesting. The following is a summary of restricted stock unit transactions for the fiscal years indicated: Share Units Weighted Average Grant-Date Fair Value Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 311,281 $ 33.93 $ 11.0 1.1 Granted 90,551 $ 44.70 Forfeited (14,378 ) $ 40.07 Released (143,680 ) $ 34.79 Outstanding at May 30, 2020 243,774 $ 37.02 $ 5.6 1.3 Ending vested + expected to vest 240,824 $ 37.00 $ 5.5 1.3 The weighted-average remaining recognition period of the outstanding restricted stock units at May 30, 2020 , was 1.2 years. The fair value of the share units that vested during the twelve months ended May 30, 2020 , was $5.9 million . The weighted average grant-date fair value of restricted stock units granted during 2020 , 2019 , and 2018 was $44.70 , $37.81 and $35.28 respectively. Performance Share Units The Company grants performance share units to certain key employees under its LTIP. The number of units initially awarded was based on the value of a portion of the participant's long-term incentive compensation, divided by the fair value of the Company's common stock on the date of grant. Each unit represents one equivalent share of the Company's common stock. The number of common shares ultimately issued in connection with these performance share units is determined based on the Company's financial performance over the related three -year service period or the Company's financial performance based on certain total shareholder return results as compared to a selected group of peer companies. Compensation expense is determined based on the grant-date fair value and the number of common shares projected to be issued and is recognized over the requisite service period. The following is a summary of performance share unit transactions for the fiscal years indicated: Share Units Weighted Average Grant-Date Fair Value Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 323,356 $ 33.48 $ 11.5 1.1 Granted 188,719 $ 45.71 Forfeited (127,538 ) $ 31.79 Outstanding at May 30, 2020 384,537 $ 37.95 $ 8.9 1.3 Ending vested + expected to vest 384,537 $ 37.95 $ 8.9 1.3 The weighted-average remaining recognition period of the outstanding performance share units at May 30, 2020 , was 1.3 years. The fair value for shares that vested during the twelve months ended May 30, 2020 , was zero . The weighted average grant-date fair value of performance share units granted during 2020 , 2019 , and 2018 was $45.71 , $36.37 , and $31.28 respectively. Deferred Compensation Plan The Herman Miller, Inc. Executive Equalization Retirement Plan is a supplemental deferred compensation plan and was made available for salary deferrals and Company contributions beginning in January 2008. The plan is available to a select group of management or highly compensated employees who are selected for participation by the Executive Compensation Committee of the Board of Directors. The plan allows participants to defer up to 50 percent of their base salary and up to 100 percent of their incentive cash bonus. Company contributions to the plan “mirror” the amounts the Company would have contributed to the various qualified retirement plans had the employee's compensation not been above the IRS statutory ceiling ( $285,000 in 2020 ). The Company does not guarantee a rate of return for these funds. Instead, participants make investment elections for their deferrals and Company contributions. Investment options are closely aligned to those available under the Herman Miller Profit Sharing and 401(k) Plan. The Nonemployee Officer and Director Deferred Compensation Plan allows the Board of Directors of the Company to defer a portion of their annual director fee. Investment options are the same as those available under the Herman Miller Profit Sharing and 401(k) Plan, including Company stock. In accordance with the terms of the Executive Equalization Plan and Nonemployee Officer and Director Deferred Compensation Plan, the salary and bonus deferrals, Company contributions and director fee deferrals have been placed in a Rabbi trust. The assets in the Rabbi trust remain subject to the claims of creditors of the Company and are not the property of the participant. Investments in securities other than the Company's common stock are included within the Other assets line item, while investments in the Company's stock are included in the line item Deferred compensation plan in the Company's Consolidated Balance Sheets. A liability of the same amount is recorded on the Consolidated Balance Sheets within the Other liabilities line item. Investment asset realized and unrealized gains and losses are recognized within the Company's Consolidated Statements of Comprehensive Income in the Interest and other investment income line item. The associated changes to the liability are recorded as compensation expense within the Selling, general and administrative line item within the Company's Consolidated Statements of Comprehensive Income. The net effect of any change to the asset and corresponding liability is offset and has no impact on Net earnings in the Consolidated Statements of Comprehensive Income. Director Fees Company directors may elect to receive their director fees in one or more of the following forms: cash, deferred compensation in the form of shares or other selected investment funds, unrestricted Company stock at the market value at the date of election or stock options that vest in one year and expire in ten years . The exercise price of the stock options granted may not be less than the market price of the Company's common stock on the date of grant. Under the plan, the Board members received the following shares or options in the fiscal years indicated: 2020 2019 2018 Shares of common stock 7,769 10,185 8,828 Shares through the deferred compensation program 1,045 7,619 2,207 |
Income Taxes
Income Taxes | 12 Months Ended |
May 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into law in the United States. The effects of the Act included the reduction of the federal corporate income tax rate from 35 percent to 21 percent and a new participation exemption system of taxation on foreign earnings, among other provisions. In accordance with Staff Accounting Bulletin 118, for the year ended June 2, 2018, the Company recorded a provisional tax benefit of $3.1 million from the impact of the Act, primarily related to the one-time U.S. tax liability on certain undistributed foreign earnings and the remeasurement of current and deferred tax liabilities. Subsequently, as the U.S. Treasury Department issued additional guidance, the Company recorded adjustments to the provisional tax benefit. During the year ended June 1, 2019, the Company completed its accounting for all the effects of the Act and recorded adjustments to the provisional amounts primarily for the one-time U.S. tax liability on certain undistributed foreign earnings and also an adjustment related to foreign tax credits to increase the income tax benefit from the Act by $1.0 million . For tax years beginning after December 31, 2017, the Act subjects a U.S. shareholder to tax on global intangible low-taxed income (“GILTI”) earned by certain foreign subsidiaries. The Company elected to account for tax expense related to GILTI in the year the tax is incurred. The components of (loss) earnings before income taxes are as follows: (In millions) 2020 2019 2018 Domestic $ (75.6 ) $ 136.2 $ 121.6 Foreign 62.2 58.9 46.5 Total $ (13.4 ) $ 195.1 $ 168.1 The provision (benefit) for income taxes consists of the following: (In millions) 2020 2019 2018 Current: Domestic - Federal $ 12.0 $ 19.0 $ 30.2 Domestic - State 5.7 6.4 4.3 Foreign 13.3 12.9 10.7 31.0 38.3 45.2 Deferred: Domestic - Federal (16.8 ) 1.0 (4.1 ) Domestic - State (3.9 ) (0.2 ) 0.1 Foreign (4.3 ) 0.5 1.2 (25.0 ) 1.3 (2.8 ) Total income tax provision $ 6.0 $ 39.6 $ 42.4 The following table represents a reconciliation of income taxes at the United States statutory rate of 21% for 2020 and 2019 , and 29.1% for 2018 with the effective tax rate as follows: (In millions) 2020 2019 2018 Income taxes computed at the United States Statutory rate $ (2.8 ) $ 41.0 $ 49.0 Increase (decrease) in taxes resulting from: State and local income taxes, net of federal income tax benefit 1.4 4.9 3.3 Non-deductible goodwill impairment 17.1 — — Gain on consolidation of equity method investments (5.5 ) — — Remeasurement of U.S. deferred tax assets and liabilities due to the Tax Act — (0.2 ) (8.9 ) U.S. tax liability on undistributed foreign earnings due to the Tax Act — (2.6 ) 9.0 Foreign-derived intangible income (1.4 ) (3.1 ) — Global intangible low-taxed income 5.9 6.9 — Foreign statutory rate differences 0.7 1.9 (4.0 ) Manufacturing deduction under the American Jobs Creation Act of 2004 — — (2.7 ) Research and development credit (4.4 ) (5.3 ) (4.2 ) Foreign offshore income claim (1.7 ) (0.7 ) — Foreign tax credit (5.8 ) (5.7 ) (2.4 ) Foreign withholding taxes and other miscellaneous foreign taxes 2.7 0.8 1.9 Other, net (0.2 ) 1.7 1.4 Income tax expense $ 6.0 $ 39.6 $ 42.4 Effective tax rate (44.9 )% 20.3 % 25.2 % The tax effects and types of temporary differences that give rise to significant components of the deferred tax assets and liabilities at May 30, 2020 and June 1, 2019 , are as follows: (In millions) 2020 2019 Deferred tax assets: Compensation-related accruals $ 14.2 $ 13.1 Accrued pension and post-retirement benefit obligations 9.6 7.2 Deferred revenue 3.7 6.1 Inventory related 3.9 1.2 Other reserves and accruals 7.9 8.1 Warranty 14.0 12.3 State and local tax net operating loss carryforwards and credits 2.5 2.5 Federal net operating loss carryforward 1.2 1.4 Foreign tax net operating loss carryforwards and credits 8.4 9.1 Accrued step rent and tenant reimbursements 0.7 4.2 Interest rate swap 6.1 0.3 Lease liability 52.5 — Other 6.9 4.7 Subtotal 131.6 70.2 Valuation allowance (10.6 ) (10.4 ) Total $ 121.0 $ 59.8 Deferred tax liabilities: Book basis in property in excess of tax basis $ 32.0 $ 26.6 Intangible assets 43.6 34.6 Right of use lease assets 44.7 — Other 3.4 2.4 Total $ 123.7 $ 63.6 The future tax benefits of net operating loss (NOL) carry-forwards and foreign tax credits are recognized to the extent that realization of these benefits is considered more likely than not. The Company bases this determination on the expectation that related operations will be sufficiently profitable or various tax planning strategies will enable the Company to utilize the NOL carry-forwards and/or foreign tax credits. To the extent that available evidence about the future raises doubt about the realization of these tax benefits, a valuation allowance is established. At May 30, 2020 , the Company had state and local tax NOL carry-forwards of $22.0 million , the state tax benefit of which is $1.2 million , which have various expiration periods from 1 to 21 years. The Company also had state credits with a state tax benefit of $1.3 million , which expire in 2 to 6 years. For financial statement purposes, the NOL carry-forwards and state tax credits have been recognized as deferred tax assets, subject to a valuation allowance of $1.6 million . At May 30, 2020 , the Company had federal NOL carry-forwards of $5.9 million , the tax benefit of which is $1.2 million , which expire in 9 years. For financial statement purposes, the NOL carry-forwards have been recognized as deferred tax assets. At May 30, 2020 , the Company had federal deferred assets of $2.3 million , the tax benefit of which is $0.5 million , which is related to investments in various foreign joint ventures. For financial statement purposes, the assets have been recognized as deferred tax assets, subject to a valuation allowance of $0.5 million . At May 30, 2020 , the Company had foreign net operating loss carry-forwards of $37.7 million , the tax benefit of which is $8.4 million , which have expiration periods from 8 years to an unlimited term. For financial statement purposes, the NOL carry-forwards have been recognized as deferred tax assets, subject to a valuation allowance of $7.7 million . At May 30, 2020 , the Company had foreign deferred assets of $4.2 million , the tax benefit of which is $0.8 million , which is related to various deferred taxes in Hong Kong and Brazil as well as buildings in the United Kingdom. For financial statement purposes, the assets have been recognized as deferred tax assets, subject to a valuation allowance of $0.8 million . The Company intends to repatriate $29.1 million in cash held in certain foreign jurisdictions and as such has recorded a deferred tax liability related to foreign withholding taxes on these future dividends received in the U.S. from foreign subsidiaries of $1.8 million . A significant portion of this cash was previously taxed under the U.S. Tax Cut and Jobs Act (TCJA) one-time U.S. tax liability on undistributed foreign earnings. The Company intends to remain indefinitely reinvested in the remaining undistributed earnings outside the U.S, which was $221.5 million on May 30, 2020. D etermination of the total amount of unrecognized deferred income tax on the remaining undistributed earnings of foreign subsidiaries is not practicable. The components of the Company's unrecognized tax benefits are as follows: (In millions) Balance at June 2, 2018 $ 3.2 Increases related to current year income tax positions 0.4 Increases related to prior year income tax positions 0.1 Decreases related to prior year income tax positions (0.4 ) Decreases related to lapse of applicable statute of limitations (0.3 ) Decreases related to settlements (1.1 ) Balance at June 1, 2019 $ 1.9 Increases related to current year income tax positions 0.3 Decreases related to prior year income tax positions (0.1 ) Decreases related to lapse of applicable statute of limitations (0.2 ) Balance at May 30, 2020 $ 1.9 The Company's effective tax rate would have been affected by the total amount of unrecognized tax benefits had this amount been recognized as a reduction to income tax expense. The Company recognizes interest and penalties related to unrecognized tax benefits through Income tax expense in its Consolidated Statements of Comprehensive Income. Interest and penalties and the related liability, which are excluded from the table above, were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Interest and penalty expense (income) $ 0.1 $ (0.3 ) $ 0.1 Liability for interest and penalties $ 0.8 $ 0.7 The Company is subject to periodic audits by domestic and foreign tax authorities. Currently, the Company is undergoing routine periodic audits in both domestic and foreign tax jurisdictions. It is reasonably possible that the amounts of unrecognized tax benefits could change in the next 12 months as a result of new positions that may be taken on income tax returns, settlement of tax positions and the closing of statutes of limitation. It is not expected that any of the changes will be material to the Company's Consolidated Statements of Comprehensive Income. During the year, the Company has partially closed the audit of fiscal 2019 with the Internal Revenue Service under the Compliance Assurance Process (CAP). The audit of fiscal 2018 also remains partially closed. For the majority of the remaining tax jurisdictions, the Company is no longer subject to state and local, or non-U.S. income tax examinations by tax authorities for fiscal years before 2017. |
Fair Value
Fair Value | 12 Months Ended |
May 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value The Company's financial instruments consist of cash equivalents, marketable securities, accounts and notes receivable, deferred compensation plan, accounts payable, debt, interest rate swaps, foreign currency exchange contracts, redeemable noncontrolling interests, indefinite-lived intangible assets and right of use assets. The Company's financial instruments, other than long-term debt, are recorded at fair value. The carrying value and fair value of the Company's long-term debt, including current maturities, is as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 Carrying value $ 591.3 $ 285.0 Fair value $ 594.0 $ 287.8 The following describes the methods the Company uses to estimate the fair value of financial assets and liabilities recorded in net earnings, which have not significantly changed in the current period: Cash and cash equivalents — The Company invests excess cash in short term investments in the form of commercial paper and money market funds. Commercial paper is valued at amortized costs while money market funds are valued using net asset value ("NAV"). Mutual Funds-equity — The Company's equity securities primarily include equity mutual funds. The equity mutual fund investments are recorded at fair value using quoted prices for similar securities. Deferred compensation plan — The Company's deferred compensation plan primarily includes various domestic and international mutual funds that are recorded at fair value using quoted prices for similar securities. Foreign currency exchange contracts — The Company's foreign currency exchange contracts are valued using an approach based on foreign currency exchange rates obtained from active markets. The estimated fair value of forward currency exchange contracts is based on month-end spot rates as adjusted by market-based current activity. These forward contracts are not designated as hedging instruments. The following table sets forth financial assets and liabilities measured at fair value through net income and the respective pricing levels to which the fair value measurements are classified within the fair value hierarchy as of May 30, 2020 and June 1, 2019 : (In millions) May 30, 2020 June 1, 2019 Financial Assets NAV Quoted Prices With Other Observable Inputs (Level 2) NAV Quoted Prices With Other Observable Inputs (Level 2) Cash equivalents: Money market funds $ 283.7 $ — $ 69.5 $ — Mutual funds - equity — 0.7 — 0.9 Foreign currency forward contracts — 1.1 — — Deferred compensation plan — 13.2 — 12.5 Total $ 283.7 $ 15.0 $ 69.5 $ 13.4 Financial Liabilities Foreign currency forward contracts $ — $ 0.8 $ — $ 1.4 Total $ — $ 0.8 $ — $ 1.4 The following describes the methods the Company uses to estimate the fair value of financial assets and liabilities recorded in other comprehensive income, which have not significantly changed in the current period: Mutual funds-fixed income — The Company's fixed-income securities primarily include fixed income mutual funds and government obligations. These investments are recorded at fair value using quoted prices for similar securities. Interest rate swap agreements — The value of the Company's interest rate swap agreements is determined using a market approach based on rates obtained from active markets. The interest rate swap agreements are designated as cash flow hedging instruments. The following table sets forth financial assets and liabilities measured at fair value through other comprehensive income and the respective pricing levels to which the fair value measurements are classified within the fair value hierarchy as of May 30, 2020 and June 1, 2019 . (In millions) May 30, 2020 June 1, 2019 Financial Assets Quoted Prices with Other Observable Inputs (Level 2) Quoted Prices with Other Observable Inputs (Level 2) Mutual funds - fixed income $ 6.3 $ 7.9 Interest rate swap agreement — 1.0 Total $ 6.3 $ 8.9 Financial Liabilities Interest rate swap agreement $ 25.0 $ 2.2 Total $ 25.0 $ 2.2 The following is a summary of the carrying and market values of the Company's fixed income mutual funds and equity mutual funds as of the dates indicated: May 30, 2020 June 1, 2019 (In millions) Cost Unrealized Gain/(Loss) Market Value Cost Unrealized Gain/(Loss) Market Value Mutual funds - fixed income $ 6.2 $ 0.1 $ 6.3 $ 7.9 $ — $ 7.9 Mutual funds - equity 0.6 0.1 0.7 0.8 0.1 0.9 Total $ 6.8 $ 0.2 $ 7.0 $ 8.7 $ 0.1 $ 8.8 The cost of securities sold is based on the specific identification method; realized gains and losses resulting from such sales are included in the Consolidated Statements of Comprehensive Income within " Other expense (income), net ". The Company reviews its investment portfolio for any unrealized losses that would be deemed other-than-temporary and requires the recognition of an impairment loss in earnings. If the cost of an investment exceeds its fair value, the Company evaluates, among other factors, general market conditions, the duration and extent to which the fair value is less than its cost, the Company's intent to hold the investment, and whether it is more likely than not that the Company will be required to sell the investment before recovery of the cost basis. The Company also considers the type of security, related industry and sector performance, and published investment ratings. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis in the investment is established. If conditions within individual markets, industry segments, or macro-economic environments deteriorate, the Company could incur future impairments. The Company views its equity and fixed income mutual funds as available for use in its current operations. Accordingly, the investments are recorded within Current Assets within the Consolidated Balance Sheets. Derivative Instruments and Hedging Activities Foreign Currency Forward Contracts The Company transacts business in various foreign currencies and has established a program that primarily utilizes foreign currency forward contracts to offset the risks associated with the effects of certain foreign currency exposures. Under this program, the Company's strategy is to have increases or decreases in our foreign currency exposures offset by gains or losses on the foreign currency forward contracts to mitigate the risks and volatility associated with foreign currency transaction gains or losses. These foreign currency exposures typically arise from net liability or asset exposures in non-functional currencies on the balance sheets of our foreign subsidiaries. These foreign currency forward contracts generally settle within 30 days and are not used for trading purposes. These forward contracts are not designated as hedging instruments. Accordingly, we record the fair value of these contracts as of the end of the reporting period in the Consolidated Balance Sheets with changes in fair value recorded within the Consolidated Statements of Comprehensive Income. The balance sheet classification for the fair values of these forward contracts is to " Other current assets " for unrealized gains and to " Other accrued liabilities " for unrealized losses. The Consolidated Statements of Comprehensive Income classification for the fair values of these forward contracts is to " Other expense (income), net ", for both realized and unrealized gains and losses. The notional amounts of the forward contracts held to purchase and sell U.S. dollars in exchange for other major international currencies were $52.6 million and $38.1 million as of May 30, 2020 and June 1, 2019 , respectively. The notional amounts of the foreign currency forward contracts held to purchase and sell British pound sterling in exchange for other major international currencies were £27.5 million and £19.2 million as of May 30, 2020 and June 1, 2019 , respectively . The Company also has other forward contracts related to other currency pairs at varying notional amounts. Interest Rate Swaps The Company enters into interest rate swap agreements to manage its exposure to interest rate changes and its overall cost of borrowing. The Company's interest rate swap agreements were entered into to exchange variable rate interest payments for fixed rate payments over the life of the agreement without the exchange of the underlying notional amounts. The notional amount of the interest rate swap agreements is used to measure interest to be paid or received. The differential paid or received on the interest rate swap agreements is recognized as an adjustment to interest expense. The interest rate swaps were designated cash flow hedges at inception and the facts and circumstances of the hedged relationship remains consistent with the initial quantitative effectiveness assessment in that the hedged instruments remain an effective accounting hedge as of May 30, 2020 . Since a designated derivative meets hedge accounting criteria, the fair value of the hedge is recorded in the Consolidated Statements of Stockholders’ Equity as a component of Accumulated other comprehensive loss, net of tax. The ineffective portion of the change in fair value of the derivatives is immediately recognized in earnings. The interest rate swap agreements are assessed for hedge effectiveness on a quarterly basis. In September 2016, the Company entered into an interest rate swap agreement. The interest rate swap is for an aggregate notional amount of $150.0 million with a forward start date of January 3, 2018 and a termination date of January 3, 2028. As a result of the transaction, the Company effectively converted indebtedness anticipated to be borrowed on the Company’s revolving line of credit up to the notional amount from a LIBOR-based floating interest rate plus applicable margin to a 1.949 percent fixed interest rate plus applicable margin under the agreement as of the forward start date. In June 2017, the Company entered into an interest rate swap agreement. The interest rate swap is for an aggregate notional amount of $75.0 million with a forward start date of January 3, 2018 and a termination date of January 3, 2028. As a result of the transaction, the Company effectively converted the Company’s revolving line of credit up to the notional amount from a LIBOR-based floating interest rate plus applicable margin to a 2.387 percent fixed interest rate plus applicable margin under the agreement as of the forward start date. The fair value of the Company’s two outstanding interest rate swap agreements was a net liability of $25.0 million and $1.2 million as of May 30, 2020 and June 1, 2019 , respectively. The liability and asset fair value were recorded within " Other liabilities " and " Other noncurrent assets " within the Consolidated Balance Sheets. Recorded within Other comprehensive loss, net of tax, for the effective portion of the Company's designated cash flow hedges was a net unrealized loss of $17.2 million and $12.8 million for the fiscal years ended May 30, 2020 and June 1, 2019 , respectively. For fiscal 2020 , 2019 and 2018 , there were no gains or losses recognized against earnings for hedge ineffectiveness. Effects of Derivatives on the Financial Statements The effects of derivatives on the consolidated financial statements were as follows for the fiscal years ended 2020 and 2019 (amounts presented exclude any income tax effects): (In millions) Balance Sheet Location May 30, 2020 June 1, 2019 Designated derivatives: Interest rate swap Long-term assets: Other noncurrent assets $ — $ 1.0 Interest rate swap Long-term liabilities: Other liabilities $ 25.0 $ 2.2 Non-designated derivatives: Foreign currency forward contracts Current assets: Other current assets $ 1.1 $ — Foreign currency forward contracts Current liabilities: Other accrued liabilities $ 0.8 $ 1.4 Fiscal Year (In millions) Statement of Comprehensive Income Location May 30, 2020 June 1, 2019 June 2, 2018 (Loss) gain recognized on foreign currency forward contracts Other expense (income), net $ (1.1 ) $ 0.3 $ 0.4 The gain/(loss) recorded, net of income taxes, in Other comprehensive loss for the effective portion of designated derivatives was as follows for the periods presented below: Fiscal Year (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Interest rate swap $ (17.2 ) $ (12.8 ) $ 7.5 Reclassified from Accumulated other comprehensive loss into earnings within " Interest expense " for the fiscal years ended 2020 , 2019 , and 2018 were gains of $0.8 million and losses of $0.5 million , and $0.3 million , respectively. Pre-tax gains expected to be reclassified from Accumulated other comprehensive loss into earnings during the next twelve months are $4.3 million . The amount of gain, net of tax, expected to be reclassified out of Accumulated other comprehensive loss into earnings during the next twelve months is $3.2 million . Investments in Equity Securities Without a Readily Determinable Fair Value In the fourth quarter of fiscal 2019, the Company recorded a gain from a $2.1 million fair value adjustment in an investment in a technology partner, which increased the total carrying value of the investment to $3.6 million as of June 1, 2020. The gain was the result of an observable price change for a similar investment in the same entity. There were no similar gains in fiscal 2020 . Redeemable Noncontrolling Interests Redeemable noncontrolling interests are reported on the Condensed Consolidated Balance Sheets in mezzanine equity in “Redeemable noncontrolling interests.” These financial instruments represent a level 3 fair value measurement. As of June 1, 2019 , the outstanding redeemable noncontrolling interests in the Company's subsidiary, Herman Miller Consumer Holdings, Inc. ("HMCH") were $20.6 million , and represented an approximate 5% minority ownership. During August 2019, the Company acquired all of the remaining redeemable noncontrolling equity interests. HMCH redeemed certain HMCH stock for cash and then, in August 2019, HMCH merged with and into the Company, with the remaining minority HMCH shareholders receiving a cash payment. Total cash paid of $20.4 million for the redemptions and for merger consideration was at fair market value based on an independent appraisal. This compares to purchases of $10.1 million during the twelve month period ended June 1, 2019 . Changes in the Company's redeemable noncontrolling interest in HMCH for the years ended May 30, 2020 and June 1, 2019 are as follows: (In millions) May 30, 2020 June 1, 2019 Beginning Balance $ 20.6 $ 30.5 Purchase of HMCH redeemable noncontrolling interests (20.4 ) (10.1 ) Redemption value adjustment (0.2 ) — Exercised options — 0.2 Ending Balance $ — $ 20.6 On December 2, 2019, the Company purchased an additional 34% equity voting interest in HAY. Upon increasing its ownership to 67% , the Company obtained a controlling financial interest and consolidated the financial results of HAY. Additionally, the Company is a party to options, that if exercised, would require it to purchase the remaining 33% of the equity in HAY, at fair market value. This remaining redeemable noncontrolling interest in HAY is classified outside permanent equity in the Consolidated Balance Sheets and is carried at the current estimated redemption amount. The Company recognizes changes to the redemption value of redeemable noncontrolling interests as they occur and adjusts the carrying value to equal the redemption value at the end of each reporting period. The redemption amounts have been estimated based on the fair value of the subsidiary, determined using discounted cash flow methods. This represents a level 3 fair value measurement. Changes in the Company's redeemable noncontrolling interest in HAY for the year ended May 30, 2020 are as follows: (In millions) May 30, 2020 Beginning Balance $ — Increase due to HAY acquisition 72.4 Redemption value adjustment (17.6 ) Net income attributable to redeemable noncontrolling interests (5.1 ) Foreign currency translation adjustments $ 0.7 Ending Balance $ 50.4 Other The following table summarizes the valuation of our assets measured at fair value on a non-recurring basis as of May 30, 2020 : (In millions) May 30, 2020 Assets: Level 3 Indefinite-lived intangible assets $ 92.8 DWR right of use assets 110.9 Not included in the above is goodwill related to the Retail and Maharam reporting units, as these were fully written down with a resulting impairment charge of $125.5 million in the fourth quarter of fiscal 2020. The relief-from-royalty method for the quantitative impairment assessment for indefinite-lived intangible assets utilized discount rates ranging from 12.75% to 17.25% and royalty rates ranging from 1.00% to 3.00% . Based on the quantitative impairment assessment performed, the carrying value these assets exceeded their fair value, resulting in an impairment charge of $53.3 million in fiscal 2020. See Note 1 and Note 7 to the Consolidated Financial Statements for additional information. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
May 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Product Warranties The Company provides coverage to the end-user for parts and labor on products sold under its warranty policy and for other product-related matters. The standard length of warranty is 12 years ; however, this varies depending on the product classification. The Company does not sell or otherwise issue warranties or warranty extensions as stand-alone products. Reserves have been established for various costs associated with the Company's warranty program. General warranty reserves are based on historical claims experience and other currently available information and are periodically adjusted for business levels and other factors. Specific reserves are established once an issue is identified with the amounts for such reserves based on the estimated cost of correction. The Company provides an assurance-type warranty that ensures that products will function as intended. As such, the Company's estimated warranty obligation is accounted for as a liability. Changes in the warranty reserve for the stated periods were as follows: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Accrual Balance — beginning $ 53.1 $ 51.5 $ 47.7 Accrual for warranty matters 23.7 20.7 22.1 Settlements and adjustments (17.6 ) (19.1 ) (18.3 ) Accrual Balance — ending $ 59.2 $ 53.1 $ 51.5 Guarantees The Company is periodically required to provide performance bonds to do business with certain customers. These arrangements are common in the industry and generally have terms ranging between one year and three years . The bonds are required to provide assurance to customers that the products and services they have purchased will be installed and/or provided properly and without damage to their facilities. The bonds are provided by various bonding agencies. However, the Company is ultimately liable for claims that may occur against them. As of May 30, 2020 , the Company had a maximum financial exposure related to performance bonds of approximately $4.4 million . The Company has no history of claims, nor is it aware of circumstances that would require it to pay, under any of these arrangements. The Company also believes that the resolution of any claims that might arise in the future, either individually or in the aggregate, would not materially affect the Company's Consolidated Financial Statements. Accordingly, no liability h as been recorded in respect to these bonds as of either May 30, 2020 or June 1, 2019 . The Company has entered into standby letter of credit arrangements for purposes of protecting various insurance companies and lessors against default on insurance premium and lease payments. As of May 30, 2020 , the Company had a maximum financial exposure from these standby letters of credit totaling approximately $9.4 million , all of which is considered usage against the Company's revolving line of credit. The Company has no history of claims, nor is it aware of circumstances that would require it to perform under any of these arrangements and believes that the resolution of any claims that might arise in the future, either individually or in the aggregate, would not materially affect the Company's Consolidated Financial Statements. Accordingly, no liability has been recorded as of May 30, 2020 and June 1, 2019 . Contingencies The Company is also involved in legal proceedings and litigation arising in the ordinary course of business. In the opinion of management, the outcome of such proceedings and litigation currently pending will not have a material adverse effect, if any, on the Company's Consolidated Financial Statements. As of the end of fiscal 2020 , outstanding commitments for future purchase obligations approximated $79.8 million |
Operating Segments
Operating Segments | 12 Months Ended |
May 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure | Operating Segments The Company's segments consist of North America Contract, International Contract and Retail. In fiscal 2018, the Company's segments consisted of North American Furniture Solutions, ELA ("EMEA, Latin America, and Asia Pacific") Furniture Solutions, Specialty and Consumer. Effective in the fourth quarter of fiscal 2019, the Company has revised its reportable segments to combine the Specialty reportable segment with the North American Furniture Solutions reportable segment. The newly combined segment is called "North America Contract". There were no changes to the Company's ELA Furniture Solutions ("ELA") and Consumer segments, but each has been renamed. Effective in the fourth quarter of fiscal 2019, ELA is now named "International Contract" and Consumer is named "Retail". The Specialty segment (Maharam, Geiger, Nemschoff and the Herman Miller Collection) has been combined with the North America Contract segment under a common segment manager as of the fourth quarter fiscal 2019. The change in operating segments reflect the basis of how the Company internally reports and evaluates financial information used to make operating decisions. Prior year results disclosed in the table below have been revised to reflect these changes. The North America Contract segment includes the operations associated with the design, manufacture and sale of furniture and textile products for work-related settings, including office, education, and healthcare environments, throughout the United States and Canada. The business associated with the Company's owned contract furniture dealers is also included in the North America Contract segment. In addition to the Herman Miller brand, this segment includes the operations associated with the design, manufacture and sale of high-craft furniture products and textiles including Geiger wood products, Maharam textiles, Nemschoff, naughtone and Herman Miller Collection products. The International Contract segment includes the operations associated with the design, manufacture, and sale of furniture products, primarily for work-related settings in EMEA, Latin America and Asia-Pacific. The Retail segment includes operations associated with the sale of modern design furnishings and accessories to third party retailers, as well as direct to consumer sales through e-commerce, direct mailing catalogs and DWR and HAY studios. The Company also reports a “Corporate” category consisting primarily of unallocated expenses related to general corporate functions, including, but not limited to, certain legal, executive, corporate finance, information technology, administrative and acquisition-related costs. Management regularly reviews corporate costs and believes disclosing such information provides more visibility and transparency regarding how the chief operating decision maker reviews results of the Company. The accounting policies of the operating segments are the same as those of the Company. The performance of the operating segments is evaluated by the Company's management using various financial measures. The following is a summary of certain key financial measures for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: North America Contract $ 1,598.2 $ 1,686.5 $ 1,589.8 International Contract 502.8 492.2 434.5 Retail 385.6 388.5 356.9 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 Depreciation and Amortization: North America Contract $ 46.7 $ 46.8 $ 43.9 International Contract 17.4 10.5 10.2 Retail 14.7 14.1 12.1 Corporate 0.7 0.7 0.7 Total $ 79.5 $ 72.1 $ 66.9 Operating Earnings (Loss): North America Contract $ 130.9 $ 189.7 $ 175.2 International Contract 18.2 57.8 36.9 Retail (148.3 ) 5.3 13.9 Corporate (39.2 ) (49.3 ) (47.1 ) Total $ (38.4 ) $ 203.5 $ 178.9 Capital Expenditures: North America Contract $ 53.7 $ 52.7 $ 46.0 International Contract 10.4 16.6 11.4 Retail 4.9 16.5 13.2 Corporate — — — Total $ 69.0 $ 85.8 $ 70.6 Total Assets: North America Contract $ 769.5 $ 733.6 $ 677.4 International Contract 512.5 356.8 283.4 Retail 310.9 310.0 291.2 Corporate 461.0 168.9 227.5 Total $ 2,053.9 $ 1,569.3 $ 1,479.5 Goodwill: North America Contract $ 182.3 $ 185.3 $ 185.3 International Contract 163.7 39.7 40.0 Retail — 78.8 78.8 Corporate — — — Total $ 346.0 $ 303.8 $ 304.1 The accounting policies of the operating segments are the same as those of the Company. Additionally, the Company employs a methodology for allocating corporate costs and assets with the underlying objective of this methodology being to allocate corporate costs according to the relative usage of the underlying resources and to allocate corporate assets according to the relative expected benefit. The majority of the allocations for corporate expenses are based on relative net sales. However, certain corporate costs, generally considered the result of isolated business decisions, are not subject to allocation and are evaluated separately from the rest of the regular ongoing business operations. The Company's product offerings consist primarily of office furniture systems, seating, freestanding furniture, storage and casegoods. These product offerings are marketed, distributed and managed primarily as a group of similar products on an overall portfolio basis. The following is a summary of net sales estimated by product category for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: Systems $ 589.3 $ 668.0 $ 601.5 Seating 1,041.6 1,013.5 965.9 Freestanding and storage 496.9 505.4 465.1 Textiles 138.8 113.8 94.3 Other (1) 220.0 266.5 254.4 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 (1) “Other” primarily consists of uncategorized product sales and service sales. Sales by geographic area are based on the location of the customer. Long-lived assets consist of long-term assets of the Company, excluding financial instruments, deferred tax assets and long-term intangibles. The following is a summary of geographic information for the years indicated. Individual foreign country information is not provided as none of the individual foreign countries in which the Company operates are considered material for separate disclosure based on quantitative and qualitative considerations. Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: United States $ 1,795.8 $ 1,865.8 $ 1,737.9 International 690.8 701.4 643.3 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 Long-lived assets: United States $ 306.7 $ 422.1 $ 349.3 International 59.6 52.2 50.5 Total $ 366.3 $ 474.3 $ 399.8 The Company estimates that no single dealer accounted for more than 4 percent of the Company's net sales in the fiscal year ended May 30, 2020 . The Company estimates that its largest single end-user customer accounted for $122.9 million , $129.6 million and $109.8 million of the Company's net sales in fiscal 2020 , 2019 and 2018 , respectively. This represents approximately 5 percent , 5 percent and 5 percent of the Company's net sales in fiscal 2020 , 2019 and 2018 , respectively. Approximately 3 percent |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
May 30, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The following table provides an analysis of the changes in accumulated other comprehensive loss for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Cumulative translation adjustments at beginning of period $ (48.3 ) $ (34.1 ) $ (36.8 ) Other comprehensive (loss) income (7.7 ) (14.2 ) 2.7 Balance at end of period (56.0 ) (48.3 ) (34.1 ) Pension and other post-retirement benefit plans at beginning of period (45.0 ) (37.2 ) (47.6 ) Other comprehensive (loss) income before reclassifications (net of tax of $3.5, $2.0, and($2.9)) (16.9 ) (10.0 ) 5.3 Reclassification from accumulated other comprehensive income - Other, net 3.3 2.6 4.2 Tax (expense) benefit (0.6 ) (0.4 ) 0.9 Net reclassifications 2.7 2.2 5.1 Net current period other comprehensive (loss) income (14.2 ) (7.8 ) 10.4 Balance at end of period (59.2 ) (45.0 ) (37.2 ) Interest rate swap agreement at beginning of period (0.9 ) 9.9 2.1 Cumulative effect of accounting change — 1.5 — Other comprehensive (loss) income before reclassifications (net of tax of $5.8, $5.3, and ($4.0)) (17.2 ) (12.8 ) 7.5 Reclassification from accumulated other comprehensive income - Other, net (0.8 ) 0.5 0.3 Net reclassifications (0.8 ) 0.5 0.3 Net current period other comprehensive (loss) income (18.0 ) (12.3 ) 7.8 Balance at end of period (18.9 ) (0.9 ) 9.9 Unrealized holding gains on securities at beginning of period — 0.1 0.1 Cumulative effect of accounting change — (0.1 ) — Other comprehensive income before reclassifications 0.1 — — Balance at end of period 0.1 — 0.1 Total Accumulated other comprehensive loss $ (134.0 ) $ (94.2 ) $ (61.3 ) |
Restructuring Expenses
Restructuring Expenses | 12 Months Ended |
May 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Expenses | Restructuring Expenses During the fourth quarter of fiscal 2018, the Company announced a facilities consolidation plan related to its International Contract segment. This impacted certain office and manufacturing facilities in the United Kingdom and China. The plan is expected to generate cost savings of approximately $3 million . To date, the Company recognized restructuring and impairment expenses of $7.8 million , with $1.4 million recognized in fiscal 2020 and the remainder in fiscal 2019 and 2018. These expenses related to the facilities consolidation plan, comprised primarily of an asset impairment recorded against an office building in the United Kingdom that was vacated and the consolidation of the Company's manufacturing facilities in China. No material future restructuring costs related to the plan are expected as the plan is substantially complete. The office buildings and related assets of United Kingdom and China have a carrying value of approximately $7.8 million and meet the criteria to be designated as assets held for sale. Therefore these assets have been classified as current assets and included within "Other current assets" in the Consolidated Balance Sheets at May 30, 2020. During the fourth quarter of fiscal 2019, the Company announced restructuring activities associated w ith profit improvement initiatives, including costs associated with an early retirement plan. The plan is expected to generate annual cost savings of approximately $10 million . To date, the Company has recognized $11.1 million of restructuring expense related to the plan. During the year ended May 30, 2020, the Company recognized $1.7 million related to the plan. The early retirement plan is complete and no future costs related to this plan are expected. In the second quarter of fiscal 2020, the North America Contract segment initiated restructuring discussions with labor unions related to its Nemschoff operation in Wisconsin. The discussions were concluded in the third quarter of fiscal 2020 and as a result, the Company anticipates the total estimated costs related to the actions will be approximately $5 million . These restructuring costs relate to potential partial outsourcing and in-sourcing strategies, long-lived asset impairments and employee-related costs. In conjunction with these discussions, during the year ended May 30, 2020, the Company has recorded $3.2 million in pre-tax restructuring expense related to this plan which is expected to be completed in fiscal 2021. In the second quarter of fiscal 2020, the Company initiated a reorganization of the Global Sales and Product teams. The reorganization activities occurred primarily in the North America business with additional costs incurred Internationally. In the year ended May 30, 2020, the Company has recorded a total of $2.6 million in pre-tax restructuring expense related to this plan. The reorganization is complete and no future costs related to this plan are expected. In the third quarter of fiscal 2020, the Company announced a reorganization of the Retail segment's leadership team. The Company recognized pre-tax severance and employee related restructuring expense of $2.2 million related to the plan. No material future restructuring costs related to the plan are expected as the plan is substantially complete. The following table provides an analysis of the changes in the restructuring costs reserve for the above plans for the fiscal years ended June 1, 2019 and May 30, 2020 : (In millions) Severance and Employee-Related Exit or Disposal Activities Total June 2, 2018 $ — $ — $ — Restructuring Costs 7.0 3.2 $ 10.2 Amounts Paid (0.2 ) (2.1 ) $ (2.3 ) June 1, 2019 $ 6.8 $ 1.1 $ 7.9 Restructuring Costs 9.9 1.2 $ 11.1 Amounts Paid (10.8 ) (1.5 ) $ (12.3 ) May 30, 2020 $ 5.9 $ 0.8 $ 6.7 In the fourth quarter of fiscal 2020, the Company announced a restructuring plan (“May 2020 restructuring plan") to substantially reduce expenses in response to the impact of the COVID-19 pandemic and related restrictions. These activities included voluntary and involuntary reductions in its North American and international workforces. Combined, these actions resulted in the elimination of approximately 400 full-time positions throughout the Company in various businesses and functions. As the result of these actions, the Company projects an annualized expense reduction of approximately $40 million . The Company incurred severance and related charges of $15.3 million in fiscal 2020, consisting solely of cash expenditures for employee termination and severance costs to be paid in fiscal 2021. The following table provides an analysis of the changes in the restructuring cost reserve for the May 2020 restructuring plan for the fiscal year ended May 30, 2020: (In millions) Severance and Employee-Related Beginning Balance $ — Restructuring Costs 15.3 Ending Balance $ 15.3 The following is a summary of restructuring expenses by segment for the fiscal years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 North America Contract $ 18.7 $ 7.7 $ 1.8 International Contract 4.8 2.5 3.9 Retail 2.9 — — Total $ 26.4 $ 10.2 $ 5.7 |
Variable Interest Entites
Variable Interest Entites | 12 Months Ended |
May 30, 2020 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entity Disclosure | Variable Interest Entities The Company has long-term notes receivable with a third-party owned dealer that are deemed to be variable interests in variable interest entity. The carrying value of these long-term notes receivable was $1.5 million and $1.6 million as of May 30, 2020 and June 1, 2019 , respectively, and represents the Company’s maximum exposure to loss. The Company is not deemed to be the primary beneficiary of the variable interest entity as the entity controls the activities that most significantly impact the entity’s economic performance, including sales, marketing, and operations. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
May 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | Quarterly Financial Data (Unaudited) Set forth below is a summary of the quarterly operating results on a consolidated basis for the years ended May 30, 2020 , June 1, 2019 , and June 2, 2018 . (In millions, except per share data) First Quarter (1) Second Quarter (1) Third Quarter (1) Fourth Quarter (1) 2020 Net sales $ 670.9 $ 674.2 $ 665.7 $ 475.7 Gross margin 246.1 255.5 243.3 165.8 Net earnings attributable to Herman Miller, Inc. 48.2 78.6 37.7 (173.7 ) Earnings per share-basic 0.82 1.33 0.64 (2.95 ) Earnings per share-diluted 0.81 1.32 0.64 (2.95 ) 2019 Net Sales $ 624.6 $ 652.6 $ 619.0 $ 671.0 Gross margin 225.1 235.6 221.0 248.2 Net earnings attributable to Herman Miller, Inc. 35.8 39.3 39.2 46.2 Earnings per share-basic 0.60 0.66 0.67 0.78 Earnings per share-diluted 0.60 0.66 0.66 0.78 2018 Net sales $ 580.3 $ 604.6 $ 578.4 $ 618.0 Gross margin 216.9 222.1 205.8 228.3 Net earnings attributable to Herman Miller, Inc. 33.1 33.5 29.8 31.8 Earnings per share-basic 0.55 0.56 0.50 0.53 Earnings per share-diluted 0.55 0.55 0.49 0.53 (1) For some line items, the sum of the quarters does not equal the annual balance reflected in the Consolidated Statements of Comprehensive Income due to rounding associated with the calculations on an individual quarter basis. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | 12 Months Ended |
May 30, 2020 | |
Schedule II Valuation and Qualifiying Accounts [Abstract] | |
Schedule of Valuation and Qualifying Accounts Disclosure | Schedule II - Valuation and Qualifying Accounts (In millions) Column A Column B Column C Column D Column E Description Balance at beginning of period Charges to expenses or net sales Deductions (3) Balance at end of period Year ended May 31, 2020: Accounts receivable allowances — uncollectible accounts (1) $ 2.9 $ 2.3 $ (0.9 ) $ 4.3 Accounts receivable allowances — credit memo (2) $ 0.6 $ — $ (0.5 ) $ 0.1 Allowance for possible losses on notes receivable $ 0.3 $ — $ — $ 0.3 Valuation allowance for deferred tax asset $ 10.4 $ 0.4 $ (0.2 ) $ 10.6 Year ended June 1, 2019: Accounts receivable allowances — uncollectible accounts (1) $ 2.4 $ 0.6 $ (0.1 ) $ 2.9 Accounts receivable allowances — credit memo (2) $ 0.5 $ — $ 0.1 $ 0.6 Allowance for possible losses on notes receivable $ 0.4 $ (0.1 ) $ — $ 0.3 Valuation allowance for deferred tax asset $ 10.3 $ 0.4 $ (0.3 ) $ 10.4 Year ended June 2, 2018: Accounts receivable allowances — uncollectible accounts (1) $ 2.3 $ 0.6 $ (0.5 ) $ 2.4 Accounts receivable allowances — credit memo (2) $ 0.4 $ 0.1 $ — $ 0.5 Allowance for possible losses on notes receivable $ 0.9 $ (0.5 ) $ — $ 0.4 Valuation allowance for deferred tax asset $ 10.0 $ 0.5 $ (0.2 ) $ 10.3 (1) Activity under the “Charges to expense or net sales” column are recorded within Selling, general and administrative expenses. (2) Activity under the “Charges to expenses or net sales” column are recorded within Net sales. (3) Represents amounts written off, net of recoveries and other adjustments. Includes effects of foreign translation. |
Significant Accounting and Re_2
Significant Accounting and Reporting Policies (Policies) | 12 Months Ended |
May 30, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The Consolidated Financial Statements include the accounts of Herman Miller, Inc. and its controlled domestic and foreign subsidiaries. The consolidated entities are collectively referred to as “the Company.” All intercompany accounts and transactions have been eliminated in the Consolidated Financial Statements. |
Fiscal Year | Fiscal Year The Company's fiscal year ends on the Saturday closest to May 31. The fiscal years ended May 30, 2020 , June 1, 2019 , and June 2, 2018 |
Foreign Currency Translation | Foreign Currency Translation The functional currency for most of the foreign subsidiaries is their local currency. The cumulative effects of translating the balance sheet accounts from the functional currency into the United States dollar using fiscal year-end exchange rates and translating revenue and expense accounts using average exchange rates for the period are reflected as a component of Accumulated other comprehensive loss in the Consolidated Balance Sheets. |
Cash Equivalents | Cash Equivalents The Company holds cash equivalents as part of its cash management function. Cash equivalents include money market funds and time deposit investments with original maturities of less than three months. The carrying value of cash equivalents, which approximates fair value, totaled $364.0 million an d $102.8 million as of May 30, 2020 and June 1, 2019 , respectively. All cash equivalents are high-credit quality financial instruments and the amount of credit exposure to any one financial institution or instrument is limited. |
Marketable Securities | Marketable Securities The Company maintains a portfolio of marketable securities primarily comprised of mutual funds. These mutual funds are comprised of both equity and fixed income funds. These investments are held by the Company's wholly owned insurance captive and have been recorded at fair value based on quoted market prices. Net unrealized holding gains or losses related to the equity mutual funds are recorded through net income while net unrealized holding gains or losses related to the fixed income mutual funds are recorded through other comprehensive income. All marketable security transactions are recognized on the trade date. Realized gains and losses are included in “Interest and other investment income” in the Consolidated Statements of Comprehensive Income. See Note 12 of the Consolidated Financial Statements for additional disclosures of marketable securities. |
Accounts Receivable Allowances | Accounts Receivable Allowances Reserves for uncollectible accounts receivable balances are based on known customer exposures, historical credit experience and the specific identification of other potentially uncollectible accounts. Balances are written off against the reserve once the Company determines the probability of collection to be remote. The Company generally does not require collateral or other security on trade accounts receivable. |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company's trade receivables are primarily due from independent dealers who, in turn, carry receivables from their customers. The Company monitors and manages the credit risk associated with individual dealers and direct customers where applicable. Dealers are responsible for assessing and assuming credit risk of their customers and may require their customers to provide deposits, letters of credit or other credit enhancement measures. Some sales contracts are structured such that the customer payment or obligation is direct to the Company. In those cases, the Company may assume the credit risk. Whether from dealers or customers, the Company's trade credit exposures are not concentrated with any particular entity. |
Inventories | Inventories Inventories are valued at the lower of cost or market and include material, labor and overhead. Inventory cost is determined using the last-in, first-out (LIFO) method at manufacturing facilities in Michigan, whereas inventories of the Company's other locations are valued using the first-in, first-out (FIFO) method. The Company establishes reserves for excess and obsolete inventory based on prevailing circumstances and judgment for consideration of current events, such as economic conditions, that may affect inventory. The reserve required to record inventory at lower of cost or net realizable value may be adjusted in response to changing conditions. Further information on the Company's recorded inventory balances can be found in Note 4 of the Consolidated Financial Statements. |
Goodwill and Indefinite-Lived Intangible Assets | Goodwill and Indefinite-lived Intangible Assets Goodwill and other indefinite-lived assets included in the Consolidated Balance Sheets consist of the following: (In millions) Goodwill Indefinite-lived Intangible Assets Total Goodwill and Indefinite-lived Intangible Assets Balance, June 2, 2018 $ 304.1 $ 78.1 $ 382.2 Foreign currency translation adjustments (0.3 ) — (0.3 ) Balance, June 2, 2019 $ 303.8 $ 78.1 $ 381.9 Foreign currency translation adjustments (0.9 ) (0.5 ) (1.4 ) Acquisition of HAY 111.1 60.0 171.1 Acquisition of naughtone 57.5 8.5 66.0 Impairment charges (125.5 ) (53.3 ) (178.8 ) Balance, May 30, 2020 $ 346.0 $ 92.8 $ 438.8 Goodwill is tested for impairment at the reporting unit level annually, or more frequently, when events or changes in circumstances indicate that the fair value of a reporting unit has more likely than not declined below its carrying value. When testing goodwill for impairment, the Company may first assess qualitative factors. If an initial qualitative assessment identifies that it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value, additional quantitative testing is performed. The Company may also elect to bypass the qualitative testing and proceed directly to the quantitative testing. If the quantitative testing indicates that goodwill is impaired, the carrying value of goodwill is written down to fair value. Each of the reporting units were reviewed for impairment using a quantitative assessment as of March 31, 2020. To estimate the fair value of each reporting unit when performing the quantitative testing, the Company utilizes a weighting of the income method and the market method. The income method is based on a discounted future cash flow analysis that uses a number of inputs, including: • actual and forecasted revenue growth rates and operating margins, and • discount rates based on the reporting unit's weighted average cost of capital. The Company corroborates the reasonableness of the inputs and outcomes of our discounted cash flow analysis through a market capitalization reconciliation to determine whether the implied control premium is reasonable. The Company completed its annual goodwill impairment test in the fourth quarter of each year, as of March 31 st . In fiscal 2020, the Company elected to perform quantitative impairment tests for all goodwill reporting units and other indefinite-lived intangible assets. In performing the quantitative impairment test, the Company determined that the fair value of the North America and International reporting units exceeded the carrying amount and, as such, these reporting units were not impaired. Our assessment of the Retail and Maharam reporting units indicated that the carrying value of these reporting units exceeded their fair values, and goodwill impairment charges of $88.8 million and $36.7 million , respectively, were recorded in fiscal 2020 resulting in no goodwill in either the Retail or Maharam reporting units. The fair value of the Company's International reporting unit, which includes $163.7 million of goodwill as of May 30, 2020, exceeds its carrying value by 17% . Due to the level that the reporting unit fair value exceeded the carrying amount and the results of the sensitivity analysis, the Company may need to record an impairment charge if the operating results of its International reporting unit were to decline in future periods. In completing our annual goodwill impairment test, the respective fair values were estimated using an income approach with market participant discount rates ranging from 10.25% to 14.0% developed using a weighted average cost of capital analysis and long-term growth rates ranging from 2.5% to 3.0% . Intangible assets with indefinite useful lives are not subject to amortization and are evaluated annually for impairment, or more frequently, when events or changes in circumstances indicate that the fair value of an intangible asset may not be recoverable. The Company utilizes the relief from royalty methodology to test for impairment. The primary assumptions for the relief from royalty method include forecasted revenue growth rates, royalty rates and discount rates. The Company measures and records an impairment loss for the excess of the carrying value of the asset over its fair value. In fiscal 2020, the Company performed quantitative assessments in testing indefinite-lived intangible assets for impairment, which resulted in the carrying values of the DWR, Maharam, HAY and naughtone trade names exceeding their fair values by $53.3 million , and impairment charges of this amount were recognized. If the residual cash flows related to these trade names were to decline in future periods, the Company may need to record an additional impairment charge. In completing our annual indefinite-lived trade name impairment test, the respective fair values were estimated using a relief-from-royalty approach, applying market participant discount rates ranging from 12.75% to 17.25% developed using a weighted average cost of capital analysis, royalty rates ranging from 1.00% to 3.00% and long-term growth rates ranging from 2.5% to 3.0% . The table below summarizes the carrying values and impairment charges recorded as of and for the fiscal year ended May 30, 2020 , for each of the Company’s indefinite-lived trade names: (In millions) Trade name Carrying Value Impairment Charge Maharam $ 16.5 $ (6.5 ) DWR 31.5 (23.6 ) HAY 39.3 (20.7 ) naughtone 6.0 (2.5 ) Total $ 93.3 $ (53.3 ) The goodwill and indefinite-lived trade name impairment charges were primarily caused by reduced sales and profitability projections, largely attributable to the COVID-19 pandemic and related economic disruption that the Company began to experience in the fourth quarter of fiscal 2020. |
Property, Equipment, and Depreciation | Property, Equipment and Depreciation Property and equipment are stated at cost. The cost is depreciated over the estimated useful lives of the assets using the straight-line method. Estimated useful lives range from 3 to 10 years for machinery and equipment and do not exceed 40 years for buildings. Leasehold improvements are depreciated over the lesser of the lease term or the useful life of the asset. The Company capitalizes certain costs incurred in connection with the development, testing and installation of software for internal use and cloud computing arrangements. Software for internal use is included in property and equipment and is depreciated over an estimated useful life not exceeding 5 years. Depreciation and amortization expense is included in the Consolidated Statements of Comprehensive Income in the Cost of sales, Selling, general and administrative and Design and research line items. |
Long-Lived Assets - Indefinite | The Company reviews the carrying value of long–lived assets for impairment when events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. If such indicators are present, the future undiscounted cash flows attributable to the asset or asset group are compared to the carrying value of the asset or asset group. Given the substantial reduction in forecasted revenue growth rates and cash flows due to the COVID-19 pandemic, the Company determined that a triggering event occurred in the fourth quarter of 2020 and an impairment assessment was warranted for certain asset groups. Accordingly, the Company compared the fair value of the asset groups to the carrying value of the asset groups. Based on this assessment, the Company recorded long-lived asset impairment charges of $26.6 million , primarily related to its right-of-use assets and definite-lived customer relationship intangible assets within the DWR asset group. The carrying value of the DWR asset group as of May 30, 2020 was $122.7 million . The Company used available market-based rental comparatives and industry data trends, as well as considerations of the remaining lease term, to determine the fair value of DWR’s right of use assets. As a result, the Company determined that the carrying value for the right-of-use assets within the DWR asset group exceeded their fair value and an impairment charge of $19.3 million was recorded. The carrying value of the DWR right of use assets at May 30, 2020 is $110.9 million . If the residual cash flows related to these long-lived assets were to decline in future periods, the Company may need to record an additional impairment charge. |
Long-Lived Assets - Finite | Amortizable intangible assets within Other amortizable intangibles, net in the Consolidated Balance Sheets consist primarily of patents, trademarks and customer relationships. The customer relationships intangible asset is comprised of relationships with customers, specifiers, networks, dealers and distributors. Refer to the following table for the combined gross carrying value and accumulated amortization for these amortizable intangibles. May 30, 2020 (In millions) Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 41.7 $ 118.7 $ 14.7 $ 175.1 Accumulated amortization 14.4 38.3 10.0 62.7 Net $ 27.3 $ 80.4 $ 4.7 $ 112.4 June 1, 2019 Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 20.1 $ 55.2 $ 12.0 $ 87.3 Accumulated amortization 12.5 27.6 6.1 46.2 Net $ 7.6 $ 27.6 $ 5.9 $ 41.1 The Company amortizes these assets over their remaining useful lives using the straight-line method over periods ranging from 5 years to 20 years , or on an accelerated basis, to reflect the expected realization of the economic benefits. It is estimated that the weighted-average remaining useful life of the patents and trademarks is approximately 7 years and the weighted-average remaining useful life of the customer relationships is 7 years |
Self Insurance | Self-Insurance The Company is partially self-insured for general liability, workers' compensation and certain employee health and dental benefits under insurance arrangements that provide for third-party coverage of claims exceeding the Company's loss retention levels. The Company's health benefit and auto liability retention levels do not include an aggregate stop loss policy. The Company's retention levels designated within significant insurance arrangements as of May 30, 2020 , ar e as follows: (In millions) Retention Level (per occurrence) General liability $ 1.00 Auto liability $ 1.00 Workers' compensation $ 0.75 Health benefit $ 0.50 The Company accrues for its self-insurance arrangements, as well as reserves for health, prescription drugs, and dental benefit exposures based on actuarially-determined estimates, which are recorded in “Other liabilities” in the Consolidated Balance Sheets. The value of the liability as of May 30, 2020 and June 1, 2019 was $13.1 million and $11.7 million , respectively. The actuarial valuations are based on historical information along with certain assumptions about future events. Changes in assumptions for such matters as legal actions, medical costs, payment lag times and changes in actual experience could cause these estimates to change. The general, auto, and workers' compensation liabilities are managed through the Company's wholly-owned insurance captive. |
Research, Development, and Other Related Costs | Research, Development and Other Related Costs Research, development, pre-production and start-up costs are expensed as incurred. Research and development ("R&D") costs consist of expenditures incurred during the course of planned research and investigation aimed at discovery of new knowledge useful in developing new products or processes. R&D costs also include the enhancement of existing products or production processes and the implementation of such through design, testing of product alternatives or construction of prototypes. R&D costs included in “ Design and research ” expense in the accompanying Consolidated Statements of Comprehensive Income are $54.3 million , $58.8 million and $57.1 million , in fiscal 2020 , 2019 , and 2018 , respectively. Royalty payments made to designers of the Company's products as the products are sold are variable costs based on product sales. These expenses totaled $19.7 million , $18.1 million and $16.0 million in fiscal years 2020 , 2019 and 2018 respectively. They are included in Design and research expense in the accompanying Consolidated Statements of Comprehensive Income . |
Revenue from Contract with Customer | Revenue Recognition The Company recognizes revenue when performance obligations, based on the terms of customer contracts, are satisfied. This happens when control of goods and services based on the contract have been conveyed to the customer. Revenue for the sale of products is typically recognized at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. Revenue for services, including the installation of products by the Company's owned dealers, is recognized over time as the services are provided. The method of revenue recognition may vary, depending on the type of contract with the customer, as noted in the section "Disaggregated Revenue" in Note 2 of the Consolidated Financial Statements . The Company's contracts with customers include master agreements and certain other forms of contracts, which do not reach the level of a performance obligation until a purchase order is received from a customer. At the point in time that a purchase order under a contract is received by the Company, the collective group of documents represent an enforceable contract between the Company and the customer. While certain customer contracts may have a duration of greater than a year, all purchase orders are less than a year in duration. As of May 30, 2020 , all unfulfilled performance obligations are expected to be fulfilled in the next twelve months. Variable consideration exists within certain contracts that the Company has with customers. When variable consideration is present in a contract with a customer, the Company estimates the amount that should be included in the transaction price utilizing either the expected value method or the most likely amount method, depending on the nature of the variable consideration. These estimates are primarily related to rebate programs which involve estimating future sales amounts and rebate percentages to use in the determination of transaction price. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Adjustments to Net sales from changes in variable consideration related to performance obligations completed in previous periods are not material to the Company's financial statements. Also, the Company has no contracts with significant financing components. The Company’s revenue is comprised primarily of sales of products and installation services. Depending on the type of contract, the method of accounting and timing of revenue recognition may differ. Below, descriptions have been provided that summarize the Company’s different types of contracts and how revenue is recognized for each. • Single Performance Obligation - these contracts are transacted with customers and include only the product performance obligation. Most commonly, these contracts represent master agreements with independent third-party dealers in which a purchase order represents the customer contract, point of sale transactions through the Retail segment, as well as customer purchase orders for the Maharam subsidiary within the North America Contract segment. For contracts that include a single performance obligation, the Company records revenue at the point in time when title and risk of loss has transferred to the customer. • Multiple Performance Obligations - these contracts are transacted with customers and include more than one performance obligation; products, which are shipped to the customer by the Company and installation and other services, which are primarily fulfilled by independent third-party dealers. For contracts that include multiple performance obligations, the Company records revenue for the product performance obligation at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. In most cases, the Company has concluded that it is the agent for the installation services performance obligation and as such, the revenue and costs of these services are recorded net within Net sales in the Company’s Consolidated Statements of Comprehensive Income. In certain instances, entities owned by the Company, rather than independent third-party dealers, perform installation and other services. In these cases, Service revenue is generated by the Company’s entities that provide installation services, which include owned dealers, and is recognized by the Company over time as the services are provided. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation based on relative standalone selling prices. • Other |
Cost of Sales | Cost of Sales The Company includes material, labor and overhead in cost of sales. Included within these categories are items such as freight charges, warehousing costs, internal transfer costs and other costs of its distribution network. |
Selling, General, and Administrative | Selling, General and Administrative |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The Company's annual effective tax rate is based on income, statutory tax rates and tax planning strategies available in the various jurisdictions the Company operates. Complex tax laws can be subject to different interpretations by the Company and the respective government authorities. Significant judgment is required in evaluating tax positions and determining our tax expense. Tax positions are reviewed quarterly and tax assets and liabilities are adjusted as new information becomes available. In evaluating the Company's ability to recover deferred tax assets within the jurisdiction from which they arise, the Company considers all positive and negative evidence. These assumptions require significant judgment about forecasts of future taxable income. |
Stock-Based Compensation | Stock-Based Compensation The Company has several stock-based compensation plans, which are described in Note 10 of the Consolidated Financial Statements. Our policy is to expense stock-based compensation using the fair-value based method of accounting for all awards granted. |
Earnings per Share | Earnings per Share Basic earnings per share (EPS) excludes the dilutive effect of common shares that could potentially be issued, due to the exercise of stock options or the vesting of restricted shares and is computed by dividing net earnings by the weighted-average number of common shares outstanding for the period. Diluted EPS is computed by dividing net earnings by the sum of the weighted-averag e number of shares outstanding, plus all dilutive shares that could potentially be issued. When in a loss position, basic and diluted EPS use the same weighted-average number of shares outstanding. Refe r to Note 9 of the Consolidated Financial Statements for further information regarding the computation of EPS. |
Comprehensive Income | Comprehensive Income Comprehensive income consists of Net earnings, Foreign currency translation adjustments, Unrealized holding gains on securities, Unrealized gains on interest rate swap agreement and Pension and post-retirement liability adjustments. Refer to Note 15 of the Consolid ated Financial Statements fo r further information regarding comprehensive income. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Fair Value | Fair Value The Company classifies and discloses its fair value measurements in one of the following three categories: • Level 1 — Financial instruments with unadjusted, quoted prices listed on active market exchanges. • Level 2 — Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. Financial instrument values are determined using prices for recently traded financial instruments with similar underlying terms and direct or indirect observational inputs, such as interest rates and yield curves at commonly quoted intervals. • Level 3 — Financial instruments not actively traded on a market exchange and there is little, if any, market activity. Values are determined using significant unobservable inputs or valuation techniques. |
Derivatives and Hedging | Derivatives and Hedging The Company calculates the fair value of financial instruments using quoted market prices whenever available. The Company utilizes derivatives to manage exposures to foreign currency exchange rates and interest rate risk. The fair values of all derivatives are recognized as assets or liabilities at the balance sheet date. Changes in the fair value of these instruments are reported within " Other expense (income), net " in the Consolidated Statements of Comprehensive Income, or " Accumulated other comprehensive loss " within the Consolidated Balance Sheets, depending on the use of the derivative and whether it qualifies for hedge accounting treatment. Gains and losses on derivatives that are designated and qualify as cash flow hedging instruments are recorded in Accumulated Other Comprehensive Loss, to the extent the hedges are effective, until the underlying transactions are recognized in the Consolidated Statements of Comprehensive Income. Derivatives not designated as hedging instruments are marked-to-market at the end of each period with the results included in Consolidated Statements of Comprehensive Income. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards On June 2, 2019, the Company adopted Accounting Standards Update ("ASU") No. 2016-02, "Leases (Topic 842)" using the modified retrospective method. Under the updated standard, a lessee's rights and obligations under most leases, including existing and new arrangements, are recognized as assets and liabilities, respectively, on the balance sheet. Refer to Note 7 to the Consolidated Financial Statements for further information regarding the adoption of the standard. On June 2, 2019, the Company adopted ASU No. 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities" using the prospective method. This update amends the hedge accounting recognition and presentation with the objectives of improving the financial reporting of hedging relationships to better portray the economic results of an entity's risk management activities and simplifying the application of hedge accounting. The update expands the strategies eligible for hedge accounting, relaxes the timing requirements of hedge documentation and effectiveness assessments and permits the use of qualitative assessments on an ongoing basis to assess hedge effectiveness. The new guidance also requires new disclosures and presentation. The adoption did not have a material impact on the Company's financial statements. Refer to Note 12 to the Consolidated Financial Statements for further information. On March 1, 2020, the Company adopted ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment" using the prospective method. This update simplifies how an entity assesses goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As amended, the goodwill impairment test consists of one step comparing the fair value of a reporting unit with its carrying amount. An entity then recognizes a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The adoption was utilized in the Company's current year goodwill impairment testing. Refer above to the "Goodwill and Indefinite-lived Intangible Assets" section for further information. |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted The Company is currently evaluating the impact of adopting the following relevant standards issued by the FASB: Standard Description Effective Date 2016-13 Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments This guidance replaces the existing incurred loss impairment model with an expected loss model and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. May 31, 2020 2018-13 Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement This update eliminates, adds and modifies certain disclosure requirements for fair value measurements. Early adoption is permitted. May 31, 2020 2018-14 Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans This update eliminates, adds and clarifies certain disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans. Early adoption is permitted. May 30, 2021 2019-12 Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes This update removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The update also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. Early adoption is permitted. May 30, 2021 All other issued and not yet effective accounting standards are not relevant to the Company. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Policies) | 12 Months Ended |
May 30, 2020 | |
Revenue from Contracts with Customers [Abstract] | |
Revenue from Contract with Customer | Revenue Recognition The Company recognizes revenue when performance obligations, based on the terms of customer contracts, are satisfied. This happens when control of goods and services based on the contract have been conveyed to the customer. Revenue for the sale of products is typically recognized at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. Revenue for services, including the installation of products by the Company's owned dealers, is recognized over time as the services are provided. The method of revenue recognition may vary, depending on the type of contract with the customer, as noted in the section "Disaggregated Revenue" in Note 2 of the Consolidated Financial Statements . The Company's contracts with customers include master agreements and certain other forms of contracts, which do not reach the level of a performance obligation until a purchase order is received from a customer. At the point in time that a purchase order under a contract is received by the Company, the collective group of documents represent an enforceable contract between the Company and the customer. While certain customer contracts may have a duration of greater than a year, all purchase orders are less than a year in duration. As of May 30, 2020 , all unfulfilled performance obligations are expected to be fulfilled in the next twelve months. Variable consideration exists within certain contracts that the Company has with customers. When variable consideration is present in a contract with a customer, the Company estimates the amount that should be included in the transaction price utilizing either the expected value method or the most likely amount method, depending on the nature of the variable consideration. These estimates are primarily related to rebate programs which involve estimating future sales amounts and rebate percentages to use in the determination of transaction price. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Adjustments to Net sales from changes in variable consideration related to performance obligations completed in previous periods are not material to the Company's financial statements. Also, the Company has no contracts with significant financing components. The Company’s revenue is comprised primarily of sales of products and installation services. Depending on the type of contract, the method of accounting and timing of revenue recognition may differ. Below, descriptions have been provided that summarize the Company’s different types of contracts and how revenue is recognized for each. • Single Performance Obligation - these contracts are transacted with customers and include only the product performance obligation. Most commonly, these contracts represent master agreements with independent third-party dealers in which a purchase order represents the customer contract, point of sale transactions through the Retail segment, as well as customer purchase orders for the Maharam subsidiary within the North America Contract segment. For contracts that include a single performance obligation, the Company records revenue at the point in time when title and risk of loss has transferred to the customer. • Multiple Performance Obligations - these contracts are transacted with customers and include more than one performance obligation; products, which are shipped to the customer by the Company and installation and other services, which are primarily fulfilled by independent third-party dealers. For contracts that include multiple performance obligations, the Company records revenue for the product performance obligation at the point in time when control transfers, generally upon transfer of title and risk of loss to the customer. In most cases, the Company has concluded that it is the agent for the installation services performance obligation and as such, the revenue and costs of these services are recorded net within Net sales in the Company’s Consolidated Statements of Comprehensive Income. In certain instances, entities owned by the Company, rather than independent third-party dealers, perform installation and other services. In these cases, Service revenue is generated by the Company’s entities that provide installation services, which include owned dealers, and is recognized by the Company over time as the services are provided. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation based on relative standalone selling prices. • Other |
Leases Leases (Policies)
Leases Leases (Policies) | 12 Months Ended |
May 30, 2020 | |
Leases [Abstract] | |
Leases | The Company has leases for retail studios, showrooms, manufacturing facilities, warehouses and vehicles, which expire at various dates through 2036 . Certain lease agreements include contingent rental payments based on per unit usage over a contractual amount and others include rental payments adjusted periodically for inflationary indexes. Variable lease costs associated with the Company’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease costs are presented as operating expenses in the Company’s Consolidated Statements of Operations and Comprehensive Income in the same line item as the expense arising from fixed lease payments for operating leases. Additionally, certain leases include renewal or termination options, which can be exercised at the Company’s discretion. Lease terms include the noncancelable portion of the underlying leases along with any reasonably certain lease periods associated with available renewal periods. The Company’s leases do not contain any residual value guarantees or material restrictive covenants. The Company determines if an arrangement is a lease at contract inception. Arrangements that are leases with an initial term of 12 months or less are not recorded in the Consolidated Balance Sheets, and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. If leased assets have leasehold improvements, the depreciable life of those leasehold improvements are limited by the expected lease term. As none of the Company’s leases provide an implicit discount rate, the Company uses an estimated incremental borrowing rate at the lease commencement date in determining the present value of the lease payments. Relevant information used in determining the Company’s incremental borrowing rate includes the duration of the lease, location of the lease, and the Company’s credit risk relative to risk-free market rates. |
Significant Accounting and Re_3
Significant Accounting and Reporting Policies (Tables) | 12 Months Ended |
May 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Goodwill and Indefinite-lived Intangibles | Goodwill and other indefinite-lived assets included in the Consolidated Balance Sheets consist of the following: (In millions) Goodwill Indefinite-lived Intangible Assets Total Goodwill and Indefinite-lived Intangible Assets Balance, June 2, 2018 $ 304.1 $ 78.1 $ 382.2 Foreign currency translation adjustments (0.3 ) — (0.3 ) Balance, June 2, 2019 $ 303.8 $ 78.1 $ 381.9 Foreign currency translation adjustments (0.9 ) (0.5 ) (1.4 ) Acquisition of HAY 111.1 60.0 171.1 Acquisition of naughtone 57.5 8.5 66.0 Impairment charges (125.5 ) (53.3 ) (178.8 ) Balance, May 30, 2020 $ 346.0 $ 92.8 $ 438.8 |
Schedule of Property and Equipment | The following table summarizes our property as of the dates indicated: (In millions) May 30, 2020 June 1, 2019 Land and improvements $ 23.7 $ 24.2 Buildings and improvements 266.5 267.6 Machinery and equipment 791.9 733.0 Construction in progress 29.2 59.9 Accumulated depreciation (780.5 ) (736.1 ) Property and equipment, net $ 330.8 $ 348.6 |
Schedule of Finite-Lived Intangible Assets by Major Class | Refer to the following table for the combined gross carrying value and accumulated amortization for these amortizable intangibles. May 30, 2020 (In millions) Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 41.7 $ 118.7 $ 14.7 $ 175.1 Accumulated amortization 14.4 38.3 10.0 62.7 Net $ 27.3 $ 80.4 $ 4.7 $ 112.4 June 1, 2019 Patent and Trademarks Customer Relationships Other Total Gross carrying value $ 20.1 $ 55.2 $ 12.0 $ 87.3 Accumulated amortization 12.5 27.6 6.1 46.2 Net $ 7.6 $ 27.6 $ 5.9 $ 41.1 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated amortization expense on existing amortizable intangible assets as of May 30, 2020 , for each of the succeeding five fiscal years, is as follows: (In millions) 2021 $ 14.9 2022 $ 14.9 2023 $ 14.4 2024 $ 14.2 2025 $ 13.3 |
Schedule of Self Insurance Retention Levels | The Company's retention levels designated within significant insurance arrangements as of May 30, 2020 , ar e as follows: (In millions) Retention Level (per occurrence) General liability $ 1.00 Auto liability $ 1.00 Workers' compensation $ 0.75 Health benefit $ 0.50 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers (Tables) | 12 Months Ended |
May 30, 2020 | |
Revenue from Contracts with Customers [Abstract] | |
Disaggregation of Revenue | Revenue disaggregated by contract type has been provided in the table below: Year Ended (In millions) May 30, 2020 June 1, 2019 Net Sales: Single performance obligation Product revenue $ 2,116.6 $ 2,155.0 Multiple performance obligations Product revenue 347.8 390.0 Service revenue 9.7 12.6 Other 12.5 9.6 Total $ 2,486.6 $ 2,567.2 Revenue disaggregated by product type and segment has been provided in the table below: Year Ended (In millions) May 30, 2020 June 1, 2019 North America Contract: Systems $ 512.7 $ 564.4 Seating 459.1 501.8 Freestanding and storage 379.8 384.9 Textiles 138.8 113.8 Other 107.8 121.6 Total North America Contract $ 1,598.2 $ 1,686.5 International Contract: Systems $ 76.6 $ 103.6 Seating 321.2 276.1 Freestanding and storage 51.1 53.0 Other 53.9 59.5 Total International Contract $ 502.8 $ 492.2 Retail: Seating $ 261.3 $ 235.6 Freestanding and storage 66.0 67.5 Other 58.3 85.4 Total Retail $ 385.6 $ 388.5 Total $ 2,486.6 $ 2,567.2 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
May 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | (In millions) May 30, 2020 June 1, 2019 Finished goods and work in process $ 151.1 $ 139.1 Raw materials 46.2 45.1 Total $ 197.3 $ 184.2 |
Investments in Nonconsolidate_2
Investments in Nonconsolidated Affiliates (Tables) | 12 Months Ended |
May 30, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investment Balances [Table Text Block] | (In millions) May 30, 2020 June 1, 2019 Investments in nonconsolidated affiliates $ 12.2 $ 89.0 |
Equity Income From Nonconsolidated Affiliates [Table Text Block] | (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Equity earnings from nonconsolidated affiliates, net of tax $ 5.0 $ 5.0 $ 3.0 |
Equity Method Investments | The Company had an ownership interest in five nonconsolidated affiliates at May 30, 2020 . Refer to the Company's ownership percentages shown below: Ownership Interest May 30, 2020 June 1, 2019 Kvadrat Maharam Arabia DMCC 50.0% 50.0% Kvadrat Maharam Pty Limited 50.0% 50.0% Kvadrat Maharam Turkey JSC 50.0% 50.0% Danskina B.V. 50.0% 50.0% Global Holdings Netherlands B.V. 48.2% 48.2% |
Schedule of Related Party Transactions [Table Text Block] | Sales to and purchases from nonconsolidated affiliates were as follows for the periods presented below: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Sales to nonconsolidated affiliates $ 3.6 $ 3.9 $ 4.3 Purchases from nonconsolidated affiliates $ 5.0 $ 23.0 $ 6.8 Balances due to or due from nonconsolidated affiliates were as follows for the periods presented below: (In millions) May 30, 2020 June 1, 2019 Receivables from nonconsolidated affiliates $ 0.6 $ 0.7 Payables to nonconsolidated affiliates $ — $ 1.2 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
May 30, 2020 | |
Line of Credit Facility | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following obligations: (In millions) May 30, 2020 June 1, 2019 Debt securities, 6.0%, due March 1, 2021 $ 50.0 $ 50.0 Debt securities, 4.95%, due May 20, 2030 49.9 — Syndicated Revolving Line of Credit, due August 2024 490.0 225.0 Construction-Type Lease — 6.9 Supplier financing program 1.4 3.1 Total debt $ 591.3 $ 285.0 Less: Current debt (51.4 ) (3.1 ) Long-term debt $ 539.9 $ 281.9 |
Schedule of Line of Credit Facilities | Available borrowings under the syndicated revolving line of credit were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 Syndicated revolving line of credit borrowing capacity $ 500.0 $ 400.0 Less: Borrowings under the syndicated revolving line of credit 490.0 225.0 Less: Outstanding letters of credit 9.4 10.0 Available borrowings under the syndicated revolving line of credit $ 0.6 $ 165.0 |
Schedule of Maturities of Long-term Debt | Annual maturities of debt for the five fiscal years subsequent to May 30, 2020 are as shown in the table below. (In millions) 2021 $ 51.4 2022 $ — 2023 $ — 2024 $ — 2025 $ 490.0 Thereafter $ 50.0 |
Leases Leases (Tables)
Leases Leases (Tables) | 12 Months Ended |
May 30, 2020 | |
Leases [Abstract] | |
Summary of Lease Expense Components | The components of lease expense were as follows: Year Ended (In millions) May 30, 2020 Operating lease costs $ 51.3 Short-term lease costs 2.6 Variable lease costs* 8.2 Total $ 62.1 *Not included in the table above for the year ended May 30, 2020 are variable lease costs of $81.3 million for raw material purchases under certain supply arrangements that the Company has determined to meet the definition of a lease. |
Summary of Future Estimated Minimum Lease Payments | The undiscounted annual future minimum lease payments related to the Company's right-of-use assets are summarized by fiscal year in the following table: (In millions) 2021 $ 48.5 2022 44.8 2023 40.2 2024 34.5 2025 30.5 Thereafter 71.9 Total lease payments* 270.4 Less interest 26.5 Present value of lease liabilities $ 243.9 *Lease payments exclude $30.6 million of legally binding minimum lease payments for leases signed but not yet commenced, primarily related to a new Chicago showroom expected to open in fiscal 2021. |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
May 30, 2020 | |
Retirement Benefits [Abstract] | |
Schedule of Funded Status and Amounts Recognized in the Balance Sheet | The following table presents, for the fiscal years noted, a summary of the changes in the projected benefit obligation, plan assets and funded status of the Company's pension plan: Pension Benefit (In millions) 2020 2019 Change in benefit obligation: Benefit obligation at beginning of year $ 109.1 $ 105.9 Interest cost 2.4 2.7 Plan Amendments — 0.9 Foreign exchange impact (2.9 ) (6.0 ) Actuarial loss (gain) 21.0 9.7 Benefits paid (3.1 ) (4.1 ) Benefit obligation at end of year $ 126.5 $ 109.1 Change in plan assets: Fair value of plan assets at beginning of year $ 88.2 $ 94.6 Actual return on plan assets 4.7 2.5 Foreign exchange impact (2.0 ) (5.1 ) Employer contributions 0.3 0.3 Benefits paid (3.1 ) (4.1 ) Fair value of plan assets at end of year $ 88.1 $ 88.2 Funded status: Under funded status at end of year $ (38.4 ) $ (20.9 ) Components of the amounts recognized in the Consolidated Balance Sheets: Current liabilities $ — $ — Non-current liabilities $ (38.3 ) $ (20.9 ) Components of the amounts recognized in Accumulated other comprehensive loss before the effect of income taxes: Prior service cost $ 0.7 $ 0.8 Unrecognized net actuarial loss (gain) $ 63.2 $ 47.3 Accumulated other comprehensive loss $ 63.9 $ 48.1 |
Schedule of Net Benefit Costs | The following table is a summary of the annual cost of the Company's pension plan: Components of Net Periodic Benefit Costs and Other Changes Recognized in Other Comprehensive Income (Loss): (In millions) 2020 2019 2018 Interest cost $ 2.4 $ 2.7 $ 2.7 Expected return on plan assets (4.4 ) (4.5 ) (5.6 ) Amortization of prior service costs 0.1 0.1 — Amortization of net (gain)/loss 3.2 2.7 4.2 Net periodic benefit cost $ 1.3 $ 1.0 $ 1.3 |
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss): (In millions) 2020 2019 Net actuarial (gain) loss $ 20.6 $ 11.7 Net amortization (4.8 ) (2.7 ) Total recognized in other comprehensive loss $ 15.8 $ 9.0 |
Schedule of Assumptions Used | The weighted-average actuarial assumptions used to determine the benefit obligation amounts and the net periodic benefit cost for the Company's pension plan are as follows: Weighted-average assumptions used in the determination of net periodic benefit cost: (Percentages) 2020 2019 2018 Discount rate 2.39 2.87 2.49 Compensation increase rate 3.20 3.10 3.25 Expected return on plan assets 4.80 4.80 6.10 Weighted-average assumptions used in the determination of the projected benefit obligations: Discount rate 1.66 2.39 2.87 Compensation increase rate 2.75 3.20 3.10 |
Schedule of Fair Value and Allocation of Plan Assets | The target asset allocation at the end of fiscal 2020 and asset categories for the Company's pension plan for fiscal 2020 and 2019 are as follows: Asset Category Targeted Asset Allocation Percentage Percentage of Plan Assets at Year End 2020 2019 2020 2019 Fixed income 35% 35% 37% 33% Common collective trusts 65% 65% 63% 67% Total 100% 100% (In millions) May 30, 2020 Asset Category Level 1 Level 2 Total Foreign government obligations — 31.4 31.4 Common collective trusts-balanced — 56.7 56.7 Total $ — $ 88.1 $ 88.1 (In millions) June 1, 2019 Asset Category Level 1 Level 2 Total Foreign government obligations — 29.3 29.3 Common collective trusts-balanced — 58.9 58.9 Total $ — $ 88.2 $ 88.2 |
Schedule of Expected Benefit Payments | The following represents a summary of the benefits expected to be paid by the plan in future fiscal years. These expected benefits were estimated based on the same actuarial valuation assumptions used to determine benefit obligations at May 30, 2020 . (In millions) Pension Benefits 2021 $ 2.4 2022 $ 2.4 2023 $ 2.5 2024 $ 2.5 2025 $ 2.6 2026-2030 $ 13.9 |
Common Stock and Per Share In_2
Common Stock and Per Share Information (Tables) | 12 Months Ended |
May 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table reconciles the numerators and denominators used in the calculations of basic and diluted EPS for each of the last three fiscal years: (In millions, except shares) 2020 2019 2018 Numerator: Numerator for both basic and diluted EPS, Net (loss) earnings attributable to Herman Miller, Inc. $ (9.1 ) $ 160.5 $ 128.1 Denominator: Denominator for basic EPS, weighted-average common shares outstanding 58,920,653 59,011,945 59,681,268 Potentially dilutive shares resulting from stock plans — 369,846 630,037 Denominator for diluted EPS 58,920,653 59,381,791 60,311,305 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
May 30, 2020 | |
Valuation and Qualifying Accounts Disclosure | |
Schedule of Pre-Tax Compensation Expense and Related Tax Benefits | Pre-tax compensation expense and the related income tax benefit for all types of stock-based programs were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Employee stock purchase program $ 0.3 $ 0.3 $ 0.3 Stock option plans 0.6 (0.4 ) 2.6 Restricted stock units 3.9 4.6 3.9 Performance share units (2.1 ) 2.8 0.9 Total $ 2.7 $ 7.3 $ 7.7 Tax benefit $ 0.5 $ 1.6 $ 2.3 |
Schedule of Fair Value of Employee Stock Options | In determining these values, the following weighted-average assumptions were used for the options granted during the fiscal years indicated: 2020 2019 2018 Risk-free interest rates (1) N/A 2.65-2.70% 1.79 % Expected term of options (2) N/A 4.4 years 4.6 years Expected volatility (3) N/A 27 % 26 % Dividend yield (4) N/A 2.18-2.33% 2.23 % Weighted-average grant-date fair value of stock options: Granted with exercise prices equal to the fair market value of the stock on the date of grant N/A $ 8.05 $ 6.39 (1) Represents term-matched, zero-coupon risk-free rate from the Treasury Constant Maturity yield curve, continuously compounded. (2) Represents historical settlement data, using midpoint scenario with 1-year grant date filter assumption for outstanding options. (3) The blended volatility approach was used. 90% term-matched historical volatility from daily stock prices and 10% percent weighted average implied volatility from the 90 days preceding the grant date. (4) Represents the quarterly dividend divided by the three-month average stock price as of the grant date, annualized and continuously compounded. |
Schedule of Stock Option Plan Transactions | The following is a summary of the transactions under the Company's stock option plan: Shares Under Option Weighted-Average Exercise Prices Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 790,059 $ 32.17 $ 3.0 5.8 Exercised (423,815 ) $ 31.63 Forfeited or expired (4,828 ) $ 33.38 Outstanding at May 30, 2020 361,416 $ 32.80 $ 0.2 5.8 Ending vested + expected to vest 361,416 $ 32.80 $ 0.2 5.8 Exercisable at end of period 186,952 $ 29.80 $ 0.2 5.2 |
Schedule of Restricted Stock Unit (RSU) Activity | The following is a summary of restricted stock unit transactions for the fiscal years indicated: Share Units Weighted Average Grant-Date Fair Value Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 311,281 $ 33.93 $ 11.0 1.1 Granted 90,551 $ 44.70 Forfeited (14,378 ) $ 40.07 Released (143,680 ) $ 34.79 Outstanding at May 30, 2020 243,774 $ 37.02 $ 5.6 1.3 Ending vested + expected to vest 240,824 $ 37.00 $ 5.5 1.3 |
Schedule of Performance-based Stock Units (PSU) Activity | The following is a summary of performance share unit transactions for the fiscal years indicated: Share Units Weighted Average Grant-Date Fair Value Aggregate Intrinsic Value (in millions) Weighted-Average Remaining Contractual Term (Years) Outstanding at June 1, 2019 323,356 $ 33.48 $ 11.5 1.1 Granted 188,719 $ 45.71 Forfeited (127,538 ) $ 31.79 Outstanding at May 30, 2020 384,537 $ 37.95 $ 8.9 1.3 Ending vested + expected to vest 384,537 $ 37.95 $ 8.9 1.3 |
Schedule of Director Share Based Compensation | Under the plan, the Board members received the following shares or options in the fiscal years indicated: 2020 2019 2018 Shares of common stock 7,769 10,185 8,828 Shares through the deferred compensation program 1,045 7,619 2,207 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
May 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The components of (loss) earnings before income taxes are as follows: (In millions) 2020 2019 2018 Domestic $ (75.6 ) $ 136.2 $ 121.6 Foreign 62.2 58.9 46.5 Total $ (13.4 ) $ 195.1 $ 168.1 |
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes consists of the following: (In millions) 2020 2019 2018 Current: Domestic - Federal $ 12.0 $ 19.0 $ 30.2 Domestic - State 5.7 6.4 4.3 Foreign 13.3 12.9 10.7 31.0 38.3 45.2 Deferred: Domestic - Federal (16.8 ) 1.0 (4.1 ) Domestic - State (3.9 ) (0.2 ) 0.1 Foreign (4.3 ) 0.5 1.2 (25.0 ) 1.3 (2.8 ) Total income tax provision $ 6.0 $ 39.6 $ 42.4 |
Effective Income Tax Rate Reconciliation | The following table represents a reconciliation of income taxes at the United States statutory rate of 21% for 2020 and 2019 , and 29.1% for 2018 with the effective tax rate as follows: (In millions) 2020 2019 2018 Income taxes computed at the United States Statutory rate $ (2.8 ) $ 41.0 $ 49.0 Increase (decrease) in taxes resulting from: State and local income taxes, net of federal income tax benefit 1.4 4.9 3.3 Non-deductible goodwill impairment 17.1 — — Gain on consolidation of equity method investments (5.5 ) — — Remeasurement of U.S. deferred tax assets and liabilities due to the Tax Act — (0.2 ) (8.9 ) U.S. tax liability on undistributed foreign earnings due to the Tax Act — (2.6 ) 9.0 Foreign-derived intangible income (1.4 ) (3.1 ) — Global intangible low-taxed income 5.9 6.9 — Foreign statutory rate differences 0.7 1.9 (4.0 ) Manufacturing deduction under the American Jobs Creation Act of 2004 — — (2.7 ) Research and development credit (4.4 ) (5.3 ) (4.2 ) Foreign offshore income claim (1.7 ) (0.7 ) — Foreign tax credit (5.8 ) (5.7 ) (2.4 ) Foreign withholding taxes and other miscellaneous foreign taxes 2.7 0.8 1.9 Other, net (0.2 ) 1.7 1.4 Income tax expense $ 6.0 $ 39.6 $ 42.4 Effective tax rate (44.9 )% 20.3 % 25.2 % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects and types of temporary differences that give rise to significant components of the deferred tax assets and liabilities at May 30, 2020 and June 1, 2019 , are as follows: (In millions) 2020 2019 Deferred tax assets: Compensation-related accruals $ 14.2 $ 13.1 Accrued pension and post-retirement benefit obligations 9.6 7.2 Deferred revenue 3.7 6.1 Inventory related 3.9 1.2 Other reserves and accruals 7.9 8.1 Warranty 14.0 12.3 State and local tax net operating loss carryforwards and credits 2.5 2.5 Federal net operating loss carryforward 1.2 1.4 Foreign tax net operating loss carryforwards and credits 8.4 9.1 Accrued step rent and tenant reimbursements 0.7 4.2 Interest rate swap 6.1 0.3 Lease liability 52.5 — Other 6.9 4.7 Subtotal 131.6 70.2 Valuation allowance (10.6 ) (10.4 ) Total $ 121.0 $ 59.8 Deferred tax liabilities: Book basis in property in excess of tax basis $ 32.0 $ 26.6 Intangible assets 43.6 34.6 Right of use lease assets 44.7 — Other 3.4 2.4 Total $ 123.7 $ 63.6 |
Schedule of Unrecognized Tax Benefits | The components of the Company's unrecognized tax benefits are as follows: (In millions) Balance at June 2, 2018 $ 3.2 Increases related to current year income tax positions 0.4 Increases related to prior year income tax positions 0.1 Decreases related to prior year income tax positions (0.4 ) Decreases related to lapse of applicable statute of limitations (0.3 ) Decreases related to settlements (1.1 ) Balance at June 1, 2019 $ 1.9 Increases related to current year income tax positions 0.3 Decreases related to prior year income tax positions (0.1 ) Decreases related to lapse of applicable statute of limitations (0.2 ) Balance at May 30, 2020 $ 1.9 |
Schedule of Unrecognized Tax Benefits, Interest, Penalties and Related Liability | Interest and penalties and the related liability, which are excluded from the table above, were as follows for the periods indicated: (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Interest and penalty expense (income) $ 0.1 $ (0.3 ) $ 0.1 Liability for interest and penalties $ 0.8 $ 0.7 |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
May 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value by Balance Sheet Grouping | (In millions) May 30, 2020 June 1, 2019 Carrying value $ 591.3 $ 285.0 Fair value $ 594.0 $ 287.8 |
Schedule of Fair Value Assets and Liabilities Measured on a Recurring and Nonrecurring Basis | The following table sets forth financial assets and liabilities measured at fair value through other comprehensive income and the respective pricing levels to which the fair value measurements are classified within the fair value hierarchy as of May 30, 2020 and June 1, 2019 . (In millions) May 30, 2020 June 1, 2019 Financial Assets Quoted Prices with Other Observable Inputs (Level 2) Quoted Prices with Other Observable Inputs (Level 2) Mutual funds - fixed income $ 6.3 $ 7.9 Interest rate swap agreement — 1.0 Total $ 6.3 $ 8.9 Financial Liabilities Interest rate swap agreement $ 25.0 $ 2.2 Total $ 25.0 $ 2.2 The following table sets forth financial assets and liabilities measured at fair value through net income and the respective pricing levels to which the fair value measurements are classified within the fair value hierarchy as of May 30, 2020 and June 1, 2019 : (In millions) May 30, 2020 June 1, 2019 Financial Assets NAV Quoted Prices With Other Observable Inputs (Level 2) NAV Quoted Prices With Other Observable Inputs (Level 2) Cash equivalents: Money market funds $ 283.7 $ — $ 69.5 $ — Mutual funds - equity — 0.7 — 0.9 Foreign currency forward contracts — 1.1 — — Deferred compensation plan — 13.2 — 12.5 Total $ 283.7 $ 15.0 $ 69.5 $ 13.4 Financial Liabilities Foreign currency forward contracts $ — $ 0.8 $ — $ 1.4 Total $ — $ 0.8 $ — $ 1.4 |
Schedule of Unrealized Gain (Loss) on Investments | The following is a summary of the carrying and market values of the Company's fixed income mutual funds and equity mutual funds as of the dates indicated: May 30, 2020 June 1, 2019 (In millions) Cost Unrealized Gain/(Loss) Market Value Cost Unrealized Gain/(Loss) Market Value Mutual funds - fixed income $ 6.2 $ 0.1 $ 6.3 $ 7.9 $ — $ 7.9 Mutual funds - equity 0.6 0.1 0.7 0.8 0.1 0.9 Total $ 6.8 $ 0.2 $ 7.0 $ 8.7 $ 0.1 $ 8.8 |
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location | The effects of derivatives on the consolidated financial statements were as follows for the fiscal years ended 2020 and 2019 (amounts presented exclude any income tax effects): (In millions) Balance Sheet Location May 30, 2020 June 1, 2019 Designated derivatives: Interest rate swap Long-term assets: Other noncurrent assets $ — $ 1.0 Interest rate swap Long-term liabilities: Other liabilities $ 25.0 $ 2.2 Non-designated derivatives: Foreign currency forward contracts Current assets: Other current assets $ 1.1 $ — Foreign currency forward contracts Current liabilities: Other accrued liabilities $ 0.8 $ 1.4 Fiscal Year (In millions) Statement of Comprehensive Income Location May 30, 2020 June 1, 2019 June 2, 2018 (Loss) gain recognized on foreign currency forward contracts Other expense (income), net $ (1.1 ) $ 0.3 $ 0.4 |
Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) | The gain/(loss) recorded, net of income taxes, in Other comprehensive loss for the effective portion of designated derivatives was as follows for the periods presented below: Fiscal Year (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Interest rate swap $ (17.2 ) $ (12.8 ) $ 7.5 |
Redeemable Noncontrolling Interest | Changes in the Company's redeemable noncontrolling interest in HAY for the year ended May 30, 2020 are as follows: (In millions) May 30, 2020 Beginning Balance $ — Increase due to HAY acquisition 72.4 Redemption value adjustment (17.6 ) Net income attributable to redeemable noncontrolling interests (5.1 ) Foreign currency translation adjustments $ 0.7 Ending Balance $ 50.4 Changes in the Company's redeemable noncontrolling interest in HMCH for the years ended May 30, 2020 and June 1, 2019 are as follows: (In millions) May 30, 2020 June 1, 2019 Beginning Balance $ 20.6 $ 30.5 Purchase of HMCH redeemable noncontrolling interests (20.4 ) (10.1 ) Redemption value adjustment (0.2 ) — Exercised options — 0.2 Ending Balance $ — $ 20.6 |
Fair Value Measurements, Nonrecurring | The following table summarizes the valuation of our assets measured at fair value on a non-recurring basis as of May 30, 2020 : (In millions) May 30, 2020 Assets: Level 3 Indefinite-lived intangible assets $ 92.8 DWR right of use assets 110.9 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
May 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability | Changes in the warranty reserve for the stated periods were as follows: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Accrual Balance — beginning $ 53.1 $ 51.5 $ 47.7 Accrual for warranty matters 23.7 20.7 22.1 Settlements and adjustments (17.6 ) (19.1 ) (18.3 ) Accrual Balance — ending $ 59.2 $ 53.1 $ 51.5 |
Operating Segments (Tables)
Operating Segments (Tables) | 12 Months Ended |
May 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following is a summary of certain key financial measures for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: North America Contract $ 1,598.2 $ 1,686.5 $ 1,589.8 International Contract 502.8 492.2 434.5 Retail 385.6 388.5 356.9 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 Depreciation and Amortization: North America Contract $ 46.7 $ 46.8 $ 43.9 International Contract 17.4 10.5 10.2 Retail 14.7 14.1 12.1 Corporate 0.7 0.7 0.7 Total $ 79.5 $ 72.1 $ 66.9 Operating Earnings (Loss): North America Contract $ 130.9 $ 189.7 $ 175.2 International Contract 18.2 57.8 36.9 Retail (148.3 ) 5.3 13.9 Corporate (39.2 ) (49.3 ) (47.1 ) Total $ (38.4 ) $ 203.5 $ 178.9 Capital Expenditures: North America Contract $ 53.7 $ 52.7 $ 46.0 International Contract 10.4 16.6 11.4 Retail 4.9 16.5 13.2 Corporate — — — Total $ 69.0 $ 85.8 $ 70.6 Total Assets: North America Contract $ 769.5 $ 733.6 $ 677.4 International Contract 512.5 356.8 283.4 Retail 310.9 310.0 291.2 Corporate 461.0 168.9 227.5 Total $ 2,053.9 $ 1,569.3 $ 1,479.5 Goodwill: North America Contract $ 182.3 $ 185.3 $ 185.3 International Contract 163.7 39.7 40.0 Retail — 78.8 78.8 Corporate — — — Total $ 346.0 $ 303.8 $ 304.1 |
Revenue from External Customers by Products and Services | The following is a summary of net sales estimated by product category for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: Systems $ 589.3 $ 668.0 $ 601.5 Seating 1,041.6 1,013.5 965.9 Freestanding and storage 496.9 505.4 465.1 Textiles 138.8 113.8 94.3 Other (1) 220.0 266.5 254.4 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 (1) “Other” primarily consists of uncategorized product sales and service sales. |
Schedule of Revenue & Long-Lived Assets by Customer Geographic Area | The following is a summary of geographic information for the years indicated. Individual foreign country information is not provided as none of the individual foreign countries in which the Company operates are considered material for separate disclosure based on quantitative and qualitative considerations. Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Net Sales: United States $ 1,795.8 $ 1,865.8 $ 1,737.9 International 690.8 701.4 643.3 Total $ 2,486.6 $ 2,567.2 $ 2,381.2 Long-lived assets: United States $ 306.7 $ 422.1 $ 349.3 International 59.6 52.2 50.5 Total $ 366.3 $ 474.3 $ 399.8 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
May 30, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | The following table provides an analysis of the changes in accumulated other comprehensive loss for the years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 Cumulative translation adjustments at beginning of period $ (48.3 ) $ (34.1 ) $ (36.8 ) Other comprehensive (loss) income (7.7 ) (14.2 ) 2.7 Balance at end of period (56.0 ) (48.3 ) (34.1 ) Pension and other post-retirement benefit plans at beginning of period (45.0 ) (37.2 ) (47.6 ) Other comprehensive (loss) income before reclassifications (net of tax of $3.5, $2.0, and($2.9)) (16.9 ) (10.0 ) 5.3 Reclassification from accumulated other comprehensive income - Other, net 3.3 2.6 4.2 Tax (expense) benefit (0.6 ) (0.4 ) 0.9 Net reclassifications 2.7 2.2 5.1 Net current period other comprehensive (loss) income (14.2 ) (7.8 ) 10.4 Balance at end of period (59.2 ) (45.0 ) (37.2 ) Interest rate swap agreement at beginning of period (0.9 ) 9.9 2.1 Cumulative effect of accounting change — 1.5 — Other comprehensive (loss) income before reclassifications (net of tax of $5.8, $5.3, and ($4.0)) (17.2 ) (12.8 ) 7.5 Reclassification from accumulated other comprehensive income - Other, net (0.8 ) 0.5 0.3 Net reclassifications (0.8 ) 0.5 0.3 Net current period other comprehensive (loss) income (18.0 ) (12.3 ) 7.8 Balance at end of period (18.9 ) (0.9 ) 9.9 Unrealized holding gains on securities at beginning of period — 0.1 0.1 Cumulative effect of accounting change — (0.1 ) — Other comprehensive income before reclassifications 0.1 — — Balance at end of period 0.1 — 0.1 Total Accumulated other comprehensive loss $ (134.0 ) $ (94.2 ) $ (61.3 ) |
Restructuring Expenses (Tables)
Restructuring Expenses (Tables) | 12 Months Ended |
May 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following table provides an analysis of the changes in the restructuring costs reserve for the above plans for the fiscal years ended June 1, 2019 and May 30, 2020 : (In millions) Severance and Employee-Related Exit or Disposal Activities Total June 2, 2018 $ — $ — $ — Restructuring Costs 7.0 3.2 $ 10.2 Amounts Paid (0.2 ) (2.1 ) $ (2.3 ) June 1, 2019 $ 6.8 $ 1.1 $ 7.9 Restructuring Costs 9.9 1.2 $ 11.1 Amounts Paid (10.8 ) (1.5 ) $ (12.3 ) May 30, 2020 $ 5.9 $ 0.8 $ 6.7 The following table provides an analysis of the changes in the restructuring cost reserve for the May 2020 restructuring plan for the fiscal year ended May 30, 2020: (In millions) Severance and Employee-Related Beginning Balance $ — Restructuring Costs 15.3 Ending Balance $ 15.3 The following is a summary of restructuring expenses by segment for the fiscal years indicated: Year Ended (In millions) May 30, 2020 June 1, 2019 June 2, 2018 North America Contract $ 18.7 $ 7.7 $ 1.8 International Contract 4.8 2.5 3.9 Retail 2.9 — — Total $ 26.4 $ 10.2 $ 5.7 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
May 30, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Set forth below is a summary of the quarterly operating results on a consolidated basis for the years ended May 30, 2020 , June 1, 2019 , and June 2, 2018 . (In millions, except per share data) First Quarter (1) Second Quarter (1) Third Quarter (1) Fourth Quarter (1) 2020 Net sales $ 670.9 $ 674.2 $ 665.7 $ 475.7 Gross margin 246.1 255.5 243.3 165.8 Net earnings attributable to Herman Miller, Inc. 48.2 78.6 37.7 (173.7 ) Earnings per share-basic 0.82 1.33 0.64 (2.95 ) Earnings per share-diluted 0.81 1.32 0.64 (2.95 ) 2019 Net Sales $ 624.6 $ 652.6 $ 619.0 $ 671.0 Gross margin 225.1 235.6 221.0 248.2 Net earnings attributable to Herman Miller, Inc. 35.8 39.3 39.2 46.2 Earnings per share-basic 0.60 0.66 0.67 0.78 Earnings per share-diluted 0.60 0.66 0.66 0.78 2018 Net sales $ 580.3 $ 604.6 $ 578.4 $ 618.0 Gross margin 216.9 222.1 205.8 228.3 Net earnings attributable to Herman Miller, Inc. 33.1 33.5 29.8 31.8 Earnings per share-basic 0.55 0.56 0.50 0.53 Earnings per share-diluted 0.55 0.55 0.49 0.53 (1) For some line items, the sum of the quarters does not equal the annual balance reflected in the Consolidated Statements of Comprehensive Income due to rounding associated with the calculations on an individual quarter basis. |
Cash Equivalents (Details)
Cash Equivalents (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Cash and Cash Equivalents [Abstract] | ||
Cash Equivalents, at Carrying Value | $ 364 | $ 102.8 |
Schedule of Goodwill (Details)
Schedule of Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Mar. 31, 2020 | |
Goodwill [Roll Forward] | |||
Beginning balance (in usd) | $ 303.8 | $ 304.1 | |
Foreign currency translation adjustments | (0.9) | (0.3) | |
Goodwill Impairment Charges | (125.5) | ||
Ending balance (in usd) | 346 | 303.8 | |
Goodwill | 303.8 | $ 304.1 | |
Retail Reporting Unit | |||
Goodwill [Roll Forward] | |||
Goodwill Impairment Charges | (88.8) | ||
Maharam Reporting Unit | |||
Goodwill [Roll Forward] | |||
Goodwill Impairment Charges | (36.7) | ||
International Reporting Unit | |||
Goodwill [Roll Forward] | |||
Ending balance (in usd) | 163.7 | ||
Goodwill | 163.7 | ||
Percentage of excess of fair value of goodwill | 17.00% | ||
HAY A/S | |||
Goodwill [Roll Forward] | |||
Goodwill, Acquired During Period | 111.1 | ||
naughtone | |||
Goodwill [Roll Forward] | |||
Goodwill, Acquired During Period | $ 57.5 | ||
Valuation Technique, Discounted Cash Flow | Minimum | Discount Rate | |||
Goodwill [Roll Forward] | |||
Goodwill Fair Value Inputs | 10.25% | ||
Valuation Technique, Discounted Cash Flow | Minimum | Long-term Growth Rate | |||
Goodwill [Roll Forward] | |||
Goodwill Fair Value Inputs | 2.50% | ||
Valuation Technique, Discounted Cash Flow | Maximum | Discount Rate | |||
Goodwill [Roll Forward] | |||
Goodwill Fair Value Inputs | 14.00% | ||
Valuation Technique, Discounted Cash Flow | Maximum | Long-term Growth Rate | |||
Goodwill [Roll Forward] | |||
Goodwill Fair Value Inputs | 3.00% |
Schedule of Indefinite-lived In
Schedule of Indefinite-lived Intangibles (Details) - USD ($) $ in Millions | Oct. 25, 2019 | Feb. 29, 2020 | May 30, 2020 | Jun. 01, 2019 | Mar. 31, 2020 |
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Beginning balance (in usd) | $ 78.1 | $ 78.1 | $ 78.1 | ||
Foreign currency translation adjustments | (0.5) | 0 | |||
Indefinite-lived Intangible Assets Impairment Charges | (53.3) | ||||
Ending balance (in usd) | 92.8 | 78.1 | |||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Beginning balance (in usd) | 381.9 | 381.9 | 382.2 | ||
Foreign currency translation adjustments | (1.4) | (0.3) | |||
Goodwill And Indefinite Lived Intangible Assets, Impairment Charges | (178.8) | ||||
Ending balance (in usd) | 438.8 | 381.9 | |||
Indefinite-lived intangibles | 78.1 | $ 92.8 | $ 78.1 | $ 93.3 | |
Relief from Royalty Approach | Discount Rate | Minimum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 12.75% | ||||
Relief from Royalty Approach | Discount Rate | Maximum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 17.25% | ||||
Relief from Royalty Approach | Royalty Rate | Minimum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 1.00% | ||||
Relief from Royalty Approach | Royalty Rate | Maximum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 3.00% | ||||
Relief from Royalty Approach | Long-term Growth Rate | Minimum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 2.50% | ||||
Relief from Royalty Approach | Long-term Growth Rate | Maximum | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangibles Fair Value Inputs | 3.00% | ||||
HAY A/S | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Goodwill And Indefinite Lived Intangible Assets, Acquired During the Period | $ 171.1 | ||||
HAY A/S | Trade Names | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Acquired | $ 56 | 60 | |||
naughtone | |||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Goodwill And Indefinite Lived Intangible Assets, Acquired During the Period | 66 | ||||
naughtone | Trade Names | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Acquired | $ 8.5 | ||||
Maharam | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Impairment Charges | (6.5) | ||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived intangibles | 16.5 | ||||
Design Within Reach | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Impairment Charges | (23.6) | ||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived intangibles | 31.5 | ||||
HAY A/S | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Impairment Charges | (20.7) | ||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived intangibles | 39.3 | ||||
naughtone | |||||
Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived Intangible Assets Impairment Charges | $ (2.5) | ||||
Goodwill And Indefinite-lived Intangible Assets [Roll Forward] | |||||
Indefinite-lived intangibles | $ 6 |
Schedule of Property, Plan and
Schedule of Property, Plan and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | $ 780.5 | $ 736.1 |
Property, Plant and Equipment, Net | 330.8 | 348.6 |
Long-term Purchase Commitment, Amount | 39.8 | |
Machinery and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 791.9 | 733 |
Machinery and Equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Machinery and Equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 40 years | |
Software Development | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Land and Land Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 23.7 | 24.2 |
Building and Building Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 266.5 | 267.6 |
Construction in Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 29.2 | $ 59.9 |
Schedule of Finite-Lived Intang
Schedule of Finite-Lived Intangible Assets by Major Class (Details) - USD ($) $ in Millions | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Finite-LIved Intangible Assets | ||
Impairment of Long-Lived Assets | $ 26.6 | |
Right of use asset impairment charge | 19.3 | |
Right of use assets | 193.9 | $ 0 |
Gross carrying value | 175.1 | 87.3 |
Accumulated amortization | 62.7 | 46.2 |
Finite-Lived Intangible Assets, Net | $ 112.4 | 41.1 |
Minimum | ||
Finite-LIved Intangible Assets | ||
Useful Life | 5 years | |
Maximum | ||
Finite-LIved Intangible Assets | ||
Useful Life | 20 years | |
Patent and Trademarks | ||
Finite-LIved Intangible Assets | ||
Gross carrying value | $ 41.7 | 20.1 |
Accumulated amortization | 14.4 | 12.5 |
Finite-Lived Intangible Assets, Net | $ 27.3 | 7.6 |
Useful Life | 7 years | |
Customer Relationships | ||
Finite-LIved Intangible Assets | ||
Gross carrying value | $ 118.7 | 55.2 |
Accumulated amortization | 38.3 | 27.6 |
Finite-Lived Intangible Assets, Net | $ 80.4 | 27.6 |
Useful Life | 7 years | |
Other | ||
Finite-LIved Intangible Assets | ||
Gross carrying value | $ 14.7 | 12 |
Accumulated amortization | 10 | 6.1 |
Finite-Lived Intangible Assets, Net | 4.7 | $ 5.9 |
Design Within Reach | ||
Finite-LIved Intangible Assets | ||
Asset Group Carrying Value | 122.7 | |
Right of use asset impairment charge | 19.3 | |
Right of use assets | $ 110.9 |
Schedule of Finite Lived Intang
Schedule of Finite Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions | May 30, 2020USD ($) |
Accounting Policies [Abstract] | |
2021 | $ 14.9 |
2022 | 14.9 |
2023 | 14.4 |
2024 | 14.2 |
2025 | $ 13.3 |
Schedule of Self Insurance (Det
Schedule of Self Insurance (Details) - USD ($) $ in Thousands | May 30, 2020 | Jun. 01, 2019 |
Accounting Policies [Abstract] | ||
General liability | $ 1,000 | |
Auto liability | 1,000 | |
Workers' compensation | 750 | |
Health benefit | 500 | |
Liability for Unpaid Claims and Claims Adjustment Expense, Net | $ 13,100 | $ 11,700 |
Research, Development and Other
Research, Development and Other Related Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Research, Development and Other Related Costs [Abstract] | |||
Research and Development Expense | $ 54.3 | $ 58.8 | $ 57.1 |
Royalty Expense | $ 19.7 | $ 18.1 | $ 16 |
Revenue Disaggregated By Contra
Revenue Disaggregated By Contract Type (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Single performance obligation | Product revenue | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 2,116.6 | 2,155 | |
Multiple performance obligations | Product revenue | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 347.8 | 390 | |
Multiple performance obligations | Service revenue | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 9.7 | 12.6 | |
Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 12.5 | $ 9.6 |
Revenue Disaggregated By Produc
Revenue Disaggregated By Product Type And Reportable Segment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
North America Contract | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 1,598.2 | 1,686.5 | |
North America Contract | Systems | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 512.7 | 564.4 | |
North America Contract | Seating | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 459.1 | 501.8 | |
North America Contract | Freestanding and storage | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 379.8 | 384.9 | |
North America Contract | Textiles | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 138.8 | 113.8 | |
North America Contract | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 107.8 | 121.6 | |
International Contract | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 502.8 | 492.2 | |
International Contract | Systems | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 76.6 | 103.6 | |
International Contract | Seating | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 321.2 | 276.1 | |
International Contract | Freestanding and storage | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 51.1 | 53 | |
International Contract | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 53.9 | 59.5 | |
Retail | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 385.6 | 388.5 | |
Retail | Seating | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 261.3 | 235.6 | |
Retail | Freestanding and storage | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 66 | 67.5 | |
Retail | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 58.3 | $ 85.4 |
Contract Assets and Contract Li
Contract Assets and Contract Liabilities (Details) $ in Millions | 12 Months Ended |
May 30, 2020USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Liability, Revenue Recognized | $ 27.7 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Details) - USD ($) | Dec. 02, 2019 | Oct. 25, 2019 | Aug. 31, 2018 | Jun. 07, 2018 | Jul. 31, 2017 | Feb. 29, 2020 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 |
Business Acquisition [Line Items] | |||||||||
Payments to Acquire Intangible Assets | $ 0 | $ 4,800,000 | $ 0 | ||||||
Business Combination, Separately Recognized Transactions, Net Gains and Losses | $ 5,900,000 | ||||||||
Contingent Equity Purchase | 33.00% | ||||||||
Gain on consolidation of equity method investments | $ 36,200,000 | 0 | 0 | ||||||
Investments in nonconsolidated affiliates | 12,200,000 | 89,000,000 | |||||||
Goodwill, Purchase Accounting Adjustments | 6,300,000 | ||||||||
Business Combinations, Changes in Deferred Tax Liabilities | 900,000 | ||||||||
Business Combinations, Changes in Inventory Step-up | 0 | ||||||||
Business Combinations, Changes in Backlog | (1,700,000) | ||||||||
Business Combinations, Changes in Deferred Revenue | (200,000) | ||||||||
Business Combinations, Changes in Tradename | 4,000,000 | ||||||||
Business Combinations, Changes in Product Development | 1,000,000 | ||||||||
Business Combinations, Changes in Customer Relationships | 1,000,000 | ||||||||
Business Combinations, Measurement Period Adjustments | 4,100,000 | ||||||||
Impairment charges | 205,400,000 | 0 | $ 0 | ||||||
Business Acquisition, Pro Forma Revenue | 2,580,600,000 | 2,757,300,000 | |||||||
Business Acquisition, Pro Forma Net Income (Loss) | (46,300,000) | 163,700,000 | |||||||
MAARS | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 48.20% | ||||||||
Purchase Price | $ 6,100,000 | ||||||||
HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 34.00% | 33.00% | |||||||
Purchase Price | $ 79,000,000 | $ 65,500,000 | |||||||
Payments to Acquire Intangible Assets | $ 4,800,000 | ||||||||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 67.00% | ||||||||
Goodwill, Acquired During Period | 111,100,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | $ 12,100,000 | ||||||||
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedWorkingCapital | 12,300,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 900,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other | 3,900,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Other | (3,100,000) | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 26,100,000 | ||||||||
Gain on consolidation of equity method investments | 300,000 | ||||||||
Investments in nonconsolidated affiliates | $ 67,800,000 | ||||||||
Deferred Tax Liabilities, Goodwill | 26,200,000 | ||||||||
Finite and Indefinite-Lived Intangible Assets Aquired | $ 114,800,000 | 118,900,000 | |||||||
naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 47.50% | ||||||||
Purchase Price | $ 45,900,000 | ||||||||
Goodwill, Acquired During Period | 57,500,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 5,100,000 | ||||||||
BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedWorkingCapital | 1,300,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 800,000 | ||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 7,200,000 | ||||||||
Gain on consolidation of equity method investments | 30,000,000 | ||||||||
Investments in nonconsolidated affiliates | 20,500,000 | ||||||||
Finite and Indefinite-Lived Intangible Assets Aquired | $ 38,900,000 | ||||||||
Wholly-owned contract furniture dealership | CANADA | |||||||||
Business Acquisition [Line Items] | |||||||||
Proceeds from Divestiture of Businesses | $ 2,000,000 | ||||||||
Gain (Loss) on Disposition of Business | $ 1,100,000 | ||||||||
Fair Value Adjustment to Inventory [Member] | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 24 days | ||||||||
Finite-lived Intangible Assets Acquired | (3,400,000) | (3,400,000) | |||||||
Fair Value Adjustment to Inventory [Member] | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 months 18 days | ||||||||
Finite-lived Intangible Assets Acquired | $ (200,000) | ||||||||
Order or Production Backlog [Member] | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 months 18 days | ||||||||
Finite-lived Intangible Assets Acquired | (3,400,000) | (1,700,000) | |||||||
Order or Production Backlog [Member] | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 months 18 days | ||||||||
Finite-lived Intangible Assets Acquired | $ (800,000) | ||||||||
DeferredRevenueIntangible [Member] | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 days | ||||||||
Finite-lived Intangible Assets Acquired | (2,000,000) | (2,200,000) | |||||||
Technology-Based Intangible Assets [Member] | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 8 years | ||||||||
Finite-lived Intangible Assets Acquired | (21,000,000) | (22,000,000) | |||||||
Customer Relationships | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 9 years | ||||||||
Finite-lived Intangible Assets Acquired | (33,000,000) | (34,000,000) | |||||||
Customer Relationships | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 9 years | ||||||||
Finite-lived Intangible Assets Acquired | $ (29,400,000) | ||||||||
Trade Names | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Indefinite-lived Intangible Assets Acquired | 56,000,000 | 60,000,000 | |||||||
Trade Names | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Indefinite-lived Intangible Assets Acquired | $ 8,500,000 | ||||||||
North America Contract | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill, Acquired During Period | 35,000,000 | ||||||||
International Contract | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill, Acquired During Period | 101,100,000 | ||||||||
International Contract | naughtone | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill, Acquired During Period | $ 22,500,000 | ||||||||
Retail | HAY | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill, Acquired During Period | $ 10,000,000 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory, Current (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods and work in process | $ 151.1 | $ 139.1 |
Raw materials | 46.2 | 45.1 |
Total | $ 197.3 | $ 184.2 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Inventory Disclosure [Abstract] | ||
LIFO Inventory Amount | $ 24.9 | $ 26.5 |
FIFO Inventory Amount | $ 210.8 | $ 198 |
Investments in Nonconsolidate_3
Investments in Nonconsolidated Affiliates - Schedule of Balance Sheet Values (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Equity Method Investments and Joint Ventures [Abstract] | ||
Investments in nonconsolidated affiliates | $ 12.2 | $ 89 |
Investments in Nonconsolidate_4
Investments in Nonconsolidated Affiliates - Schedule of Equity Method Earnings (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |||
Equity earnings from nonconsolidated affiliates, net of tax | $ 5 | $ 5 | $ 3 |
Investments in Nonconsolidate_5
Investments in Nonconsolidated Affiliates - Schedule of Ownership Percentage (Details) | May 30, 2020 | Jun. 01, 2019 |
Kvadrat Maharam Arabia DMCC | ||
Schedule of Equity Method Investments | ||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% |
Kvadrat Maharam Pty Limited | ||
Schedule of Equity Method Investments | ||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% |
Kvadrat Maharam Turkey JSC | ||
Schedule of Equity Method Investments | ||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% |
Danskina B.V. | ||
Schedule of Equity Method Investments | ||
Equity Method Investment, Ownership Percentage | 50.00% | 50.00% |
Global Holdings Netherlands B.V. | ||
Schedule of Equity Method Investments | ||
Equity Method Investment, Ownership Percentage | 48.20% | 48.20% |
Investments in Nonconsolidate_6
Investments in Nonconsolidated Affiliates (Details) $ in Millions | Aug. 31, 2018USD ($) | Nov. 28, 2020USD ($) | May 30, 2020USD ($)occurence | Jun. 01, 2019USD ($) |
Schedule of Equity Method Investments | ||||
Number of Equity Method Investments | occurence | 5 | |||
Kvadrat Maharam Pty Limited | ||||
Schedule of Equity Method Investments | ||||
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity | $ 1.7 | $ 1.8 | ||
Global Holdings Netherlands B.V. | ||||
Schedule of Equity Method Investments | ||||
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity | $ 3.1 | 2.5 | ||
Equity Method Investment, Temporary Difference Between Carrying Amount and Underlying Equity | 2.7 | 2.1 | ||
Equity Method Investment, Permanent Difference Between Carrying Amount and Underlying Equity | $ 0.4 | $ 0.4 | ||
Global Holdings Netherlands B.V. | ||||
Schedule of Equity Method Investments | ||||
Business Acquisition, Percentage of Voting Interests Acquired | 48.20% | |||
Payments to Acquire Businesses, Gross | $ 6.1 | |||
Forecast | ||||
Schedule of Equity Method Investments | ||||
Proceeds from Sale of Equity Method Investments | $ 3 |
Investments in Nonconsolidate_7
Investments in Nonconsolidated Affiliates - Schedule of Sales/Purchases to/from Nonconsolidated Affiliates (Details) - Equity Method Investee - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Schedule of Equity Method Investments | |||
Sales to nonconsolidated affiliates | $ 3.6 | $ 3.9 | $ 4.3 |
Purchases from nonconsolidated affiliates | $ 5 | $ 23 | $ 6.8 |
Investments in Nonconsolidate_8
Investments in Nonconsolidated Affiliates - Schedule of Receivables from/Payables to Nonconsolidated Affiliates (Details) - Equity Method Investee - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Schedule of Equity Method Investments [Line Items] | ||
Receivables from nonconsolidated affiliates | $ 0.6 | $ 0.7 |
Payables to nonconsolidated affiliates | $ 0 | $ 1.2 |
Schedule of Long Term Debt (Det
Schedule of Long Term Debt (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Debt Instrument [Line Items] | ||
Construction-Type Lease | $ 0 | $ 6.9 |
Supplier financing program | 1.4 | 3.1 |
Total debt | 591.3 | 285 |
Less: Current debt | (51.4) | (3.1) |
Long-term debt | 539.9 | 281.9 |
Debt securities, 6.0%, due March 1, 2021 | ||
Debt Instrument [Line Items] | ||
Debt securities | 50 | 50 |
Debt securities, 4.95%, due May 20, 2030 | ||
Debt Instrument [Line Items] | ||
Debt securities | $ 49.9 | $ 0 |
Debt (Details)
Debt (Details) - USD ($) | 12 Months Ended | ||
May 30, 2020 | Jun. 02, 2019 | Jun. 01, 2019 | |
Line of Credit Facility | |||
Interest Coverage | 350.00% | ||
Supplier financing program | $ 1,400,000 | $ 3,100,000 | |
Finance Leased Assets, Gross | 6,700,000 | ||
Construction-Type Lease | 0 | 6,900,000 | |
Retained earnings | $ 683,900,000 | 712,700,000 | |
Minimum | |||
Line of Credit Facility | |||
Leverage Ratio | 350.00% | ||
Maximum | |||
Line of Credit Facility | |||
Leverage Ratio | 400.00% | ||
Syndicated line of credit | |||
Line of Credit Facility | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 500,000,000 | 400,000,000 | |
Line Of Credit Facility, Increase in Borrowing Capacity | 250,000,000 | 200,000,000 | |
Proceeds from Lines of Credit | 265,000,000 | ||
Syndicated Revolving Line of Credit, due August 2024 | 490,000,000 | 225,000,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | 600,000 | 165,000,000 | |
Letters of credit | |||
Line of Credit Facility | |||
Outstanding letters of credit | 9,400,000 | $ 10,000,000 | |
Debt securities, 6.0%, due March 1, 2021 | |||
Line of Credit Facility | |||
Line of Credit Facility, Maximum Borrowing Capacity | 150,000,000 | ||
Debt Instrument, Face Amount | $ 50,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.95% | ||
Debt Instrument, Unused Borrowing Capacity, Amount | $ 50,000,000 | ||
Accounting Standards Update 2016-02 | |||
Line of Credit Facility | |||
Retained earnings | $ 0 |
Long-Term Debt - Schedule of Ma
Long-Term Debt - Schedule of Maturities of Long-Term Debt (Details) $ in Millions | May 30, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 51.4 |
2022 | 0 |
2023 | 0 |
2024 | 0 |
2025 | 490 |
Thereafter | $ 50 |
Leases Impact of Adoption (Deta
Leases Impact of Adoption (Details) - USD ($) | May 30, 2020 | Jun. 02, 2019 | Jun. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use assets | $ 193,900,000 | $ 0 | |
Total operating lease liabilities | 243,900,000 | ||
Retained earnings | $ 683,900,000 | $ 712,700,000 | |
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right of use assets | $ 245,000,000 | ||
Total operating lease liabilities | 275,000,000 | ||
Retained earnings | $ 0 |
Leases Leases (Details)
Leases Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Leases [Abstract] | ||
Total lease costs | $ 62.1 | |
Operating lease costs | 51.3 | |
Short-term lease costs | 2.6 | |
Variable lease costs | 8.2 | |
Supply Arrangement Variable Lease Costs | 81.3 | |
Right of use asset impairment charge | 19.3 | |
2021 | 48.5 | |
2022 | 44.8 | |
2023 | 40.2 | |
2024 | 34.5 | |
2025 | 30.5 | |
Thereafter | 71.9 | |
Total lease payments | 270.4 | |
Less interest | 26.5 | |
Present value of lease liabilities | 243.9 | |
Leases Not yet Commenced Future Payments | 30.6 | |
Lease liabilities, noncurrent | $ 178.8 | $ 0 |
2020 | 51.7 | |
2021 | 46.8 | |
2022 | 42.9 | |
2023 | 39 | |
2024 | 33.5 | |
Thereafter | 101.9 | |
Total | $ 315.8 | |
Weighted Average Remaining Lease Term | 7 years | |
Weighted Average Discount Rate, Percent | 3.10% | |
Cash paid for amounts included in the measurement of lease liabilities | $ 49.2 | |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 13.4 |
Employee Benefit Plans - Schedu
Employee Benefit Plans - Schedule of Funded Status and Amounts Recognized in the Balance Sheet (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Components of the amounts recognized in the Consolidated Balance Sheets: | |||
Non-current liabilities | $ (42.4) | $ (24.5) | |
International | Pension Plan | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of year | 109.1 | 105.9 | |
Interest cost | 2.4 | 2.7 | $ 2.7 |
Plan Amendments | 0 | 0.9 | |
Foreign exchange impact | (2.9) | (6) | |
Actuarial loss (gain) | 21 | 9.7 | |
Benefits paid | (3.1) | (4.1) | |
Benefit obligation at end of year | 126.5 | 109.1 | 105.9 |
Change in plan assets: | |||
Fair value of plan assets at beginning of year | 88.2 | 94.6 | |
Actual return on plan assets | 4.7 | 2.5 | |
Foreign exchange impact | (2) | (5.1) | |
Employer contributions | 0.3 | 0.3 | |
Benefits paid | (3.1) | (4.1) | |
Fair value of plan assets at end of year | 88.1 | 88.2 | $ 94.6 |
Funded status: | |||
Under funded status at end of year | (38.4) | (20.9) | |
Components of the amounts recognized in the Consolidated Balance Sheets: | |||
Current liabilities | 0 | 0 | |
Non-current liabilities | (38.3) | (20.9) | |
Components of the amounts recognized in Accumulated other comprehensive loss before the effect of income taxes: | |||
Prior service cost | 0.7 | 0.8 | |
Unrecognized net actuarial loss (gain) | 63.2 | 47.3 | |
Accumulated other comprehensive loss | $ 63.9 | $ 48.1 |
Employee Benefit Plans - Sche_2
Employee Benefit Plans - Schedule of Net Benefit Costs (Details) - International - Pension Plan - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | |||
Interest cost | $ 2.4 | $ 2.7 | $ 2.7 |
Expected return on plan assets | (4.4) | (4.5) | (5.6) |
Amortization of prior service costs | 0.1 | 0.1 | 0 |
Amortization of net (gain)/loss | 3.2 | 2.7 | 4.2 |
Net periodic benefit cost | $ 1.3 | $ 1 | $ 1.3 |
Employee Benefit Plans - Sche_3
Employee Benefit Plans - Schedule of Amounts Recognized in Other Comprehensive Income (Loss) (Details) - International - Pension Plan - USD ($) $ in Millions | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Defined Benefit Plan Disclosure | ||
Net actuarial gain | $ 20.6 | $ 11.7 |
Net amortization | (4.8) | (2.7) |
Total recognized in other comprehensive loss | $ 15.8 | $ 9 |
Employee Benefit Plans - Sche_4
Employee Benefit Plans - Schedule of Assumptions Used (Details) - Pension Plan - International | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Weighted-average assumptions used in the determination of net periodic benefit cost: | |||
Discount rate | 2.39% | 2.87% | 2.49% |
Compensation increase rate | 3.20% | 3.10% | 3.25% |
Expected return on plan assets | 4.80% | 4.80% | 6.10% |
Weighted-average assumptions used in the determination of the projected benefit obligations: | |||
Discount rate | 1.66% | 2.39% | 2.87% |
Compensation increase rate | 2.75% | 3.20% | 3.10% |
Employee Benefit Plans - Sche_5
Employee Benefit Plans - Schedule of Fair Value and Allocation of Plan Assets (Details) - Pension Plan - International - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 |
Defined Benefit Plan Disclosure | |||
Percentage of Plan Assets at Year End | 100.00% | 100.00% | |
Defined Benefit Plan, Plan Assets, Amount | $ 88.1 | $ 88.2 | $ 94.6 |
Level 1 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | 0 | 0 | |
Level 2 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | $ 88.1 | $ 88.2 | |
Fixed income | |||
Defined Benefit Plan Disclosure | |||
Targeted Asset Allocation Percentage | 35.00% | 35.00% | |
Percentage of Plan Assets at Year End | 37.00% | 33.00% | |
Common collective trusts | |||
Defined Benefit Plan Disclosure | |||
Targeted Asset Allocation Percentage | 65.00% | 65.00% | |
Percentage of Plan Assets at Year End | 63.00% | 67.00% | |
Defined Benefit Plan, Plan Assets, Amount | $ 56.7 | $ 58.9 | |
Common collective trusts | Level 1 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | 0 | 0 | |
Common collective trusts | Level 2 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | 56.7 | 58.9 | |
Foreign government obligations | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | 31.4 | 29.3 | |
Foreign government obligations | Level 1 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | 0 | 0 | |
Foreign government obligations | Level 2 | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Plan Assets, Amount | $ 31.4 | $ 29.3 |
Employee Benefit Plans - Sche_6
Employee Benefit Plans - Schedule of Expected Benefit Payments (Details) - International - Pension Plan $ in Millions | May 30, 2020USD ($) |
Defined Benefit Plan, Estimated Future Benefit Payments [Abstract] | |
2021 | $ 2.4 |
2022 | 2.4 |
2023 | 2.5 |
2024 | 2.5 |
2025 | 2.6 |
2026-2030 | $ 13.9 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Expected Amortization of Gain (Loss), Next Fiscal Year | $ 4,900,000 | ||
Pension contributions | $ 900,000 | $ 900,000 | $ 13,400,000 |
Defined Contribution Plan, Employer Matching Contribution, Percent of Match | 100.00% | ||
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent | 4.00% | 3.00% | |
Defined Contribution Plan, Core Contribution per Employee, Percent | 4.00% | 1.00% | |
Cost recognized | $ 22,200,000 | 25,400,000 | $ 24,900,000 |
Deferred Profit Sharing | |||
Defined Benefit Plan Disclosure | |||
Defined Contribution Plan, Employer Discretionary Contribution Amount | 0 | 0 | $ 0 |
Pension Plan | International | |||
Defined Benefit Plan Disclosure | |||
Defined Benefit Plan, Accumulated Benefit Obligation | $ 123,900,000 | $ 105,400,000 |
Employee Benefit Plans - Parant
Employee Benefit Plans - Paranthetical (Details) - USD ($) | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Pension contributions | $ 900,000 | $ 900,000 | $ 13,400,000 |
Deferred Profit Sharing | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 0 | $ 0 | $ 0 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Calculation of Numerator and Denominator in Earnings Per Share (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Numerator: | |||||||||||||||
Numerator for both basic and diluted EPS, Net (loss) earnings attributable to Herman Miller, Inc. | $ (173.7) | $ 37.7 | $ 78.6 | $ 48.2 | $ 46.2 | $ 39.2 | $ 39.3 | $ 35.8 | $ 31.8 | $ 29.8 | $ 33.5 | $ 33.1 | $ (9.1) | $ 160.5 | $ 128.1 |
Denominator: | |||||||||||||||
Denominator for basic EPS, weighted-average common shares outstanding | 58,920,653 | 59,011,945 | 59,681,268 | ||||||||||||
Potentially dilutive shares resulting from stock plans | 0 | 369,846 | 630,037 | ||||||||||||
Denominator for diluted EPS | 58,920,653 | 59,381,791 | 60,311,305 |
Common Stock and Per Share In_3
Common Stock and Per Share Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Earnings Per Share [Abstract] | |||
Antidilutive securities excluded from computation of earnings per share | 142,224 | 218,037 | 348,089 |
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 250,000,000 | ||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 237.6 | ||
Stock Repurchased During Period, Shares | 641,192 | 1,326,023 | 1,356,156 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 12 Months Ended | ||
May 30, 2020USD ($)$ / sharesshares | Jun. 01, 2019USD ($)$ / sharesshares | Jun. 02, 2018USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Shares Authorized ( in shares) | shares | 5,991,307,000,000 | ||
Stock-based compensation cost not yet recognized | $ 3,200,000 | ||
Weighted-average period over which this amount is expected to be recognized | 1 year 2 months 12 days | ||
Balance at beginning of period (in shares) | shares | 70,145 | 62,957 | 67,335 |
Cash received during fiscal 2020 from the exercise of stock options | $ 12,000,000 | ||
IRS statutory compensation ceiling | $ 285,000 | ||
Employee stock purchase program | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Capital shares reserved for future issuance | shares | 4,000,000 | ||
Reserved for purchase by plan participants (percentage) | 85.00% | ||
Employee stock option | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Weighted-average period over which this amount is expected to be recognized | 1 year | ||
Intrinsic value of options exercised | $ 5,500,000 | $ 3,300,000 | $ 5,000,000 |
Employee stock option | Director | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 1 year | ||
Expiration period (in years) | 10 years | ||
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Weighted-average period over which this amount is expected to be recognized | 1 year 2 months 12 days | ||
Conversion ratio to common stock | 1 | ||
Fair value of the shares that vested | $ 5,900,000 | ||
Granted | $ / shares | $ 44.70 | $ 37.81 | $ 35.28 |
Performance share units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Weighted-average period over which this amount is expected to be recognized | 1 year 3 months 18 days | ||
Conversion ratio to common stock | 1 | ||
Fair value of the shares that vested | $ 0 | ||
Granted | $ / shares | $ 45.71 | $ 36.37 | $ 31.28 |
Minimum | Employee stock option | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 1 year | ||
Minimum | Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 3 years | ||
Minimum | Performance share units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 3 years | ||
Maximum | Employee stock option | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 3 years | ||
Expiration period (in years) | 10 years | ||
Maximum | Executive Equalization Retirement Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Cash awards granted, percentage | 50.00% | ||
Percentage of incentive cash bonus | 100.00% |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Pre-Tax Compensation Expense and Related Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation | $ 2.7 | $ 7.3 | $ 7.7 |
Tax benefit | 0.5 | 1.6 | 2.3 |
Employee stock purchase program | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation | 0.3 | 0.3 | 0.3 |
Stock option plans | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation | 0.6 | (0.4) | 2.6 |
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation | 3.9 | 4.6 | 3.9 |
Performance share units | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation | $ (2.1) | $ 2.8 | $ 0.9 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Fair Value of Employee Stock Options (Details) - $ / shares | Aug. 22, 2018 | Jul. 16, 2018 | Jul. 18, 2017 |
Share-based Payment Arrangement [Abstract] | |||
Risk-free interest rate | 2.65% | 2.70% | 1.79% |
Expected term of options | 4 years 4 months 24 days | 4 years 4 months 24 days | 4 years 7 months 6 days |
Expected volatility | 27.00% | 27.00% | 26.00% |
Dividend yield | 2.18% | 2.33% | 2.23% |
Granted with exercise prices equal to the fair market value of the stock on the date of grant (usd per share) | $ 8.05 | $ 8.05 | $ 6.39 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Stock Option Plan Transactions (Details) - Employee stock option - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Shares Under Option | ||
Outstanding at beginning of period (in shares) | 790,059 | |
Exercised | (423,815) | |
Forfeited or expired | (4,828) | |
Outstanding at end of period (in shares) | 361,416 | 790,059 |
Ending vested and expected to vest (shares) | 361,416 | |
Exercisable at end of period (shares) | 186,952 | |
Weighted-Average Exercise Prices | ||
Outstanding at beginning of period | $ 32.17 | |
Exercised | 31.63 | |
Forfeited or expired | 33.38 | |
Outstanding at end of period | 32.80 | $ 32.17 |
Ending vested and expected to vest | 32.80 | |
Exercisable at end of period | $ 29.80 | |
Aggregate Intrinsic Value | ||
Aggregate intrinsic value at end of period (in millions of usd) | $ 0.2 | $ 3 |
Ending vested expected to vest | 0.2 | |
Exercisable at end of period | $ 0.2 | |
Weighted-Average Remaining Contractual Term | ||
Weighted average remaining contractual term at end of period (in years) | 5 years 9 months 18 days | 5 years 9 months 18 days |
Ending vested expected to vest | 5 years 9 months 18 days | |
Exercisable at end of period | 5 years 2 months 12 days |
Stock-Based Compensation - Sc_4
Stock-Based Compensation - Schedule of Restricted Stock Unit (RSU) Activity (Details) - Restricted stock units - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Share Units | |||
Beginning balance | 311,281 | ||
Granted | 90,551 | ||
Forfeited | 14,378 | ||
Released | (143,680) | ||
Ending balance | 243,774 | 311,281 | |
Ending vested and expected to vest | 240,824 | ||
Weighted Average Grant-Date Fair Value | |||
Outstanding, at beginning of year | $ 33.93 | ||
Granted | 44.70 | $ 37.81 | $ 35.28 |
Forfeited | 40.07 | ||
Released | 34.79 | ||
Outstanding, at end of year | 37.02 | $ 33.93 | |
Ending vested and expected to vest | $ 37 | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value (in millions) | $ 5.6 | $ 11 | |
Ending vested expected to vest | $ 5.5 | ||
Weighted-Average Remaining Contractual Term | |||
Weighted average remaining contractual term (years) | 1 year 3 months 18 days | 1 year 1 month 6 days | |
Weighted average remaining contractual term, expected to vest (years) | 1 year 3 months 18 days | ||
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 3 years |
Stock-Based Compensation - Sc_5
Stock-Based Compensation - Schedule of Performance-based Stock Units (PSU) Activity (Details) - Performance share units - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Share Units | |||
Beginning balance | 323,356 | ||
Granted | 188,719 | ||
Forfeited | 127,538 | ||
Ending balance | 384,537 | 323,356 | |
Ending vested and expected to vest | 384,537 | ||
Weighted Average Grant-Date Fair Value | |||
Outstanding, at beginning of year | $ 33.48 | ||
Granted | 45.71 | $ 36.37 | $ 31.28 |
Forfeited | 31.79 | ||
Outstanding, at end of year | 37.95 | $ 33.48 | |
Ending vested and expected to vest | $ 37.95 | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value (in millions) | $ 8.9 | $ 11.5 | |
Ending vested expected to vest | $ 8.9 | ||
Weighted-Average Remaining Contractual Term | |||
Weighted average remaining contractual term (years) | 1 year 3 months 18 days | 1 year 1 month 6 days | |
Weighted average remaining contractual term, expected to vest (years) | 1 year 3 months 18 days | ||
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Exercisable period (in years) | 3 years |
Stock-Based Compensation - Sc_6
Stock-Based Compensation - Schedule of Director Share Based Compensation (Details) - Director - shares | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Shares of common stock | 7,769 | 10,185 | 8,828 |
Shares through the deferred compensation program | 1,045 | 7,619 | 2,207 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Tax Carryforward | |||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | $ 1 | $ 3.1 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 29.10% |
State and local tax net operating loss carryforwards and credits | $ 2.5 | $ 2.5 | |
Federal net operating loss carryforward | 1.2 | 1.4 | |
Deferred Tax Assets, Gross | 131.6 | 70.2 | |
Foreign tax net operating loss carryforwards and credits | 8.4 | 9.1 | |
Deferred Tax Assets, Valuation Allowance | 10.6 | $ 10.4 | |
Foreign Cash Intended to be Repatriated | 29.1 | ||
Deferred Tax Liability, Foreign Withholding Taxes on Future Dividends | 1.8 | ||
Undistributed Earnings of Foreign Subsidiaries | 221.5 | ||
State And Local Jurisdiction | |||
Tax Carryforward | |||
Operating Loss Carryforwards | 22 | ||
State and local tax net operating loss carryforwards and credits | 1.2 | ||
State credits | 1.3 | ||
Operating Loss and Tax Credit Carryforwards, Valuation Allowance | 1.6 | ||
Internal Revenue Service (IRS) | |||
Tax Carryforward | |||
Operating Loss Carryforwards | 5.9 | ||
Federal net operating loss carryforward | 1.2 | ||
Foreign Tax Authority | |||
Tax Carryforward | |||
Operating Loss Carryforwards | 37.7 | ||
Operating Loss and Tax Credit Carryforwards, Valuation Allowance | 7.7 | ||
Foreign tax net operating loss carryforwards and credits | 8.4 | ||
Carryforward, Tax Deferred Expense, Reserves and Accruals, Other | 4.2 | ||
Deferred Tax Assets, Tax Deferred Expense, Reserves and Accruals, Other | 0.8 | ||
Deferred Tax Assets, Valuation Allowance | $ 0.8 | ||
Minimum | State And Local Jurisdiction | |||
Tax Carryforward | |||
Operating Loss Carryfoward, Expiration Period | 1 year | ||
Tax Credit Carryforward, Expiration Period | 2 years | ||
Minimum | Internal Revenue Service (IRS) | |||
Tax Carryforward | |||
Tax Credit Carryforward, Expiration Period | 9 years | ||
Maximum | State And Local Jurisdiction | |||
Tax Carryforward | |||
Operating Loss Carryfoward, Expiration Period | 21 years | ||
Tax Credit Carryforward, Expiration Period | 6 years | ||
Internal Revenue Service (IRS) | |||
Tax Carryforward | |||
Deferred Tax Assets, Gross | $ 2.3 | ||
Deferred Tax Assets, Tax Deferred Expense | 0.5 | ||
Deferred Tax Assets, Valuation Allowance | $ 0.5 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income before Income Tax, Domestic and Foreign (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (75.6) | $ 136.2 | $ 121.6 |
Foreign | 62.2 | 58.9 | 46.5 |
(Loss) Earnings before income taxes and equity income | $ (13.4) | $ 195.1 | $ 168.1 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Income Tax Disclosure [Abstract] | |||
Current: Domestic - Federal | $ 12 | $ 19 | $ 30.2 |
Domestic - State | 5.7 | 6.4 | 4.3 |
Foreign | 13.3 | 12.9 | 10.7 |
Current Income Tax Expense (Benefit) | 31 | 38.3 | 45.2 |
Deferred: Domestic - Federal | (16.8) | 1 | (4.1) |
Domestic - State | (3.9) | (0.2) | 0.1 |
Foreign | (4.3) | 0.5 | 1.2 |
Deferred Income Tax Expense (Benefit) | (25) | 1.3 | (2.8) |
Income tax expense | $ 6 | $ 39.6 | $ 42.4 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Income Tax Disclosure [Abstract] | |||
Income taxes computed at the United States Statutory rate | $ (2.8) | $ 41 | $ 49 |
State and local income taxes, net of federal income tax benefit | 1.4 | 4.9 | 3.3 |
Non-deductible goodwill impairment | 17.1 | 0 | 0 |
Gain on consolidation of equity method investments | (5.5) | 0 | 0 |
Remeasurement of U.S. deferred tax assets and liabilities due to the Tax Act | 0 | (0.2) | (8.9) |
U.S. tax liability on undistributed foreign earnings due to the Tax Act | 0 | (2.6) | 9 |
Foreign-derived intangible income | (1.4) | (3.1) | 0 |
Global intangible low-taxed income | 5.9 | 6.9 | 0 |
Foreign statutory rate differences | 0.7 | 1.9 | (4) |
Manufacturing deduction under the American Jobs Creation Act of 2004 | 0 | 0 | (2.7) |
Research and development credit | (4.4) | (5.3) | (4.2) |
Foreign offshore income claim | (1.7) | (0.7) | 0 |
Foreign tax credit | (5.8) | (5.7) | (2.4) |
Foreign withholding taxes and other miscellaneous foreign taxes | 2.7 | 0.8 | 1.9 |
Other, net | (0.2) | 1.7 | 1.4 |
Income tax expense | $ 6 | $ 39.6 | $ 42.4 |
Effective tax rate | (44.90%) | 20.30% | 25.20% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Deferred tax assets: | ||
Compensation-related accruals | $ 14.2 | $ 13.1 |
Accrued pension and post-retirement benefit obligations | 9.6 | 7.2 |
Deferred revenue | 3.7 | 6.1 |
Inventory related | 3.9 | 1.2 |
Other reserves and accruals | 7.9 | 8.1 |
Warranty | 14 | 12.3 |
State and local tax net operating loss carryforwards and credits | 2.5 | 2.5 |
Federal net operating loss carryforward | 1.2 | 1.4 |
Foreign tax net operating loss carryforwards and credits | 8.4 | 9.1 |
Accrued step rent and tenant reimbursements | 0.7 | 4.2 |
Interest rate swap | 6.1 | 0.3 |
Lease liability | 52.5 | 0 |
Other | 6.9 | 4.7 |
Subtotal | 131.6 | 70.2 |
Valuation allowance | (10.6) | (10.4) |
Total | 121 | 59.8 |
Deferred tax liabilities: | ||
Book basis in property in excess of tax basis | 32 | 26.6 |
Intangible assets | 43.6 | 34.6 |
Right of use lease assets | 44.7 | 0 |
Other | 3.4 | 2.4 |
Total | $ 123.7 | $ 63.6 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefits, beginning balance | $ 1.9 | $ 1.9 | $ 3.2 |
Increases related to current year income tax positions | 0.3 | 0.4 | |
Increases related to prior year income tax positions | 0.1 | ||
Decreases related to prior year income tax positions | (0.1) | (0.4) | |
Decreases related to lapse of applicable statute of limitations | (0.2) | (0.3) | |
Decreases related to settlements | (1.1) | ||
Unrecognized tax benefits, ending balance | $ 1.9 | $ 1.9 |
Income Taxes - Schedule of Un_2
Income Taxes - Schedule of Unrecognized Ta Benefits, Interest, Penalties and Related Liability (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Income Tax Disclosure [Abstract] | |||
Interest and penalty expense | $ (0.1) | $ 0.3 | $ (0.1) |
Liability for interest and penalties | $ 0.8 | $ 0.7 |
Fair Value (Details)
Fair Value (Details) £ in Millions | Dec. 02, 2019 | Jun. 12, 2017USD ($) | Sep. 13, 2016USD ($) | Sep. 01, 2018USD ($) | May 29, 2021USD ($) | May 30, 2020USD ($) | Jun. 01, 2019USD ($) | Jun. 02, 2018USD ($) | May 30, 2020GBP (£) | Jun. 01, 2019GBP (£) | Jun. 07, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Derivative Liability, Notional Amount | $ 52,600,000 | $ 38,100,000 | |||||||||
Derivative Asset, Notional Amount | £ | £ 27.5 | £ 19.2 | |||||||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (17,200,000) | (12,800,000) | $ 7,500,000 | ||||||||
Gain (Loss) on Cash Flow Hedge Ineffectiveness, Net | 0 | 0 | 0 | ||||||||
Equity Securities without Readily Determinable Fair Value, Upward Price Adjustment, Annual Amount | $ 2,100,000 | 0 | 2,100,000 | 0 | |||||||
Equity Securities without Readily Determinable Fair Value, Amount | 3,600,000 | ||||||||||
Redeemable noncontrolling interests | 50,400,000 | 20,600,000 | |||||||||
Goodwill Impairment Charges | 125,500,000 | ||||||||||
Indefinite-lived Intangible Assets Impairment Charges | 53,300,000 | ||||||||||
Payments to Noncontrolling Interests | $ 20,300,000 | 10,100,000 | 1,000,000 | ||||||||
Contingent Equity Purchase | 33.00% | ||||||||||
Forecast | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Gross Amount to be Transferred | $ (4,300,000) | ||||||||||
Derivative Instruments, Gain (Loss) Reclassification from Accumulated OCI to Income, Estimated Net Amount to be Transferred | $ (3,200,000) | ||||||||||
Other, net | Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ (800,000) | 500,000 | 300,000 | ||||||||
Herman Miller Consumer Holdings | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Redeemable noncontrolling interests | 0 | 20,600,000 | $ 30,500,000 | ||||||||
Payments to Acquire Additional Interest in Subsidiaries | 20,400,000 | ||||||||||
Purchase of redeemable noncontrolling interests | $ 20,400,000 | $ 10,100,000 | |||||||||
Herman Miller Consumer Holdings | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.00% | 5.00% | |||||||||
Foreign Exchange Forward | Not Designated as Hedging Instrument | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Derivative, Term of Contract | 30 days | ||||||||||
Interest rate swap agreement | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Derivative Asset, Notional Amount | $ 75,000,000 | $ 150,000,000 | |||||||||
Debt Conversion, Converted Instrument, Rate | 238.70% | 1.949% | |||||||||
Interest rate swap agreement | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Interest Rate Swap Agreement | $ 25,000,000 | $ 1,200,000 | |||||||||
Interest rate swap agreement | Other Liabilities | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Interest Rate Swap Agreement | $ 2,200,000 | ||||||||||
Relief from Royalty Approach | Minimum | Discount Rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Indefinite-lived Intangibles Fair Value Inputs | 12.75% | ||||||||||
Relief from Royalty Approach | Minimum | Royalty Rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Indefinite-lived Intangibles Fair Value Inputs | 1.00% | ||||||||||
Relief from Royalty Approach | Maximum | Discount Rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Indefinite-lived Intangibles Fair Value Inputs | 17.25% | ||||||||||
Relief from Royalty Approach | Maximum | Royalty Rate | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Indefinite-lived Intangibles Fair Value Inputs | 3.00% | ||||||||||
HAY A/S | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | |||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 34.00% | 33.00% | |||||||||
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions | 67.00% |
Fair Value - Schedule of Fair V
Fair Value - Schedule of Fair Value by Balance Sheet Grouping (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Fair Value Disclosures [Abstract] | ||
Debt, Carrying value | $ 591.3 | $ 285 |
Debt Instrument, Fair Value Disclosure | $ 594 | $ 287.8 |
Fair Value - Schedule of Fair_2
Fair Value - Schedule of Fair Value Assets and Liabilities Measured on a Recurring and Nonrecurring Basis (Details) - USD ($) $ in Millions | May 30, 2020 | Mar. 31, 2020 | Jun. 01, 2019 | Jun. 02, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | $ 7 | $ 8.8 | ||
Indefinite-lived intangibles | 92.8 | $ 93.3 | 78.1 | $ 78.1 |
DWR Right of use assets | 193.9 | 0 | ||
Mutual funds - equity | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | 0.7 | 0.9 | ||
Mutual funds - fixed income | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | 6.3 | 7.9 | ||
Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Total | 13.4 | |||
NAV | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Total | 283.7 | 69.5 | ||
Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Deferred compensation plan | 13.2 | 12.5 | ||
Total | 15 | |||
Total | 0.8 | 1.4 | ||
Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Interest rate swap agreement | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Interest Rate Swap Agreement | 25 | 1.2 | ||
Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Mutual funds - equity | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Mutual funds - equity | 0.7 | 0.9 | ||
Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Mutual funds - fixed income | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | 6.3 | 7.9 | ||
Fair Value, Inputs, Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Indefinite-lived intangibles | 92.8 | |||
Money Market Funds | NAV | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Money market funds | 283.7 | 69.5 | ||
Money Market Funds | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Money market funds | 0 | 0 | ||
Other Current Assets | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Foreign currency forward contracts | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Foreign currency forward contracts - asset | 1.1 | 0 | ||
Other Current Liabilities | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Foreign currency forward contracts | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Foreign currency forward contracts - liability | 0.8 | 1.4 | ||
Other Assets | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | 6.3 | 8.9 | ||
Other Assets | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Interest rate swap agreement | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Interest Rate Swap Agreement | 0 | 1 | ||
Other Liabilities | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Available-for-sale Securities | 25 | 2.2 | ||
Other Liabilities | Quoted Prices with Other Observable Inputs (Level 2) | Fair Value, Recurring [Member] | Interest rate swap agreement | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Interest Rate Swap Agreement | $ 2.2 | |||
Design Within Reach | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
Indefinite-lived intangibles | $ 31.5 | |||
DWR Right of use assets | 110.9 | |||
Design Within Reach | Fair Value, Inputs, Level 3 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis | ||||
DWR Right of use assets | $ 110.9 |
Fair Value - Schedule of Unreal
Fair Value - Schedule of Unrealized Gain (Loss) on Investments (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Gain (Loss) on Investments | ||
Cost | $ 6.8 | $ 8.7 |
Unrealized Gain/(Loss) | 0.2 | 0.1 |
Market Value | 7 | 8.8 |
Mutual funds - fixed income | ||
Gain (Loss) on Investments | ||
Cost | 6.2 | 7.9 |
Unrealized Gain/(Loss) | 0.1 | 0 |
Market Value | 6.3 | 7.9 |
Mutual funds - equity | ||
Gain (Loss) on Investments | ||
Cost | 0.6 | 0.8 |
Unrealized Gain/(Loss) | 0.1 | 0.1 |
Market Value | $ 0.7 | $ 0.9 |
Fair Value - Schedule of Deriva
Fair Value - Schedule of Derivative Instruments in Statement of Financial Position (Details) - Fair Value, Recurring [Member] - Quoted Prices with Other Observable Inputs (Level 2) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Interest rate swap agreement | ||
Derivatives, Fair Value [Line Items] | ||
Interest Rate Swap Agreement | $ 25 | $ 1.2 |
Interest rate swap agreement | Other noncurrent assets | ||
Derivatives, Fair Value [Line Items] | ||
Interest Rate Swap Agreement | 0 | 1 |
Interest rate swap agreement | Other noncurrent liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Interest Rate Swap Agreement | 2.2 | |
Foreign Exchange Forward | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Foreign Currency Contract, Asset, Fair Value Disclosure | 1.1 | 0 |
Foreign Exchange Forward | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Foreign Currency Contracts, Liability, Fair Value Disclosure | $ 0.8 | $ 1.4 |
Fair Value - Schedule of Deri_2
Fair Value - Schedule of Derivative Instruments, Gain (loss) in Statement of Financial Performance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Forward Contracts | Other Expense Income | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Foreign Currency Transaction Gain (Loss), before Tax | $ (1.1) | $ 0.3 | $ 0.4 |
Fair Value - Schedule of Gain_L
Fair Value - Schedule of Gain/Loss in Other Comprehensive Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | $ (17.2) | $ (12.8) | $ 7.5 |
Interest rate swap | $ 18 | $ 12.3 | $ (7.8) |
Fair Value Fair Value - Schedul
Fair Value Fair Value - Schedule of Redeemable Noncontrolling Interests (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Redeemable Noncontrolling Interest [Line Items] | |||
Redeemable noncontrolling interests | $ 50.4 | $ 20.6 | |
Redemption value adjustment | 17.8 | $ (6.2) | |
Foreign currency translation adjustments | 0.7 | ||
HAY | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Redeemable noncontrolling interests | 50.4 | 0 | |
Redemption value adjustment | (17.6) | ||
Increase due to HAY acquisition | 72.4 | ||
Net income attributable to redeemable noncontrolling interests | (5.1) | ||
Herman Miller Consumer Holdings | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Redeemable noncontrolling interests | 0 | 20.6 | $ 30.5 |
Purchase of HMCH redeemable noncontrolling interests | (20.4) | (10.1) | |
Redemption value adjustment | (0.2) | 0 | |
Exercised options | $ 0 | $ 0.2 | |
Herman Miller Consumer Holdings | |||
Redeemable Noncontrolling Interest [Line Items] | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 5.00% |
Fair Value - Paranthetical (Det
Fair Value - Paranthetical (Details) - USD ($) | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Gain (Loss) on Cash Flow Hedge Ineffectiveness, Net | $ 0 | $ 0 | $ 0 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Accrued Product Warranty (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Warranty Length | 12 years | ||
Movement in Standard Product Warranty Accrual [Roll Forward] | |||
Accrual balance, beginning | $ 53.1 | $ 51.5 | $ 47.7 |
Accrual for warranty matters | 23.7 | 20.7 | 22.1 |
Settlements and adjustments | (17.6) | (19.1) | (18.3) |
Accrual balance, ending | $ 59.2 | $ 53.1 | $ 51.5 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | |
May 30, 2020 | Jun. 01, 2019 | |
Unrecorded Unconditional Purchase Obligation | $ 79,800,000 | |
Performance Guarantee | ||
Guarantor Obligations, Maximum Exposure, Undiscounted | 4,400,000 | |
Guarantor Obligations, Current Carrying Value | 0 | $ 0 |
Financial Standby Letter of Credit | ||
Guarantor Obligations, Maximum Exposure, Undiscounted | 9,400,000 | |
Guarantor Obligations, Current Carrying Value | $ 0 | $ 0 |
Minimum | Performance Guarantee | ||
Guarantor Obligations, Term | P1Y | |
Maximum | Performance Guarantee | ||
Guarantor Obligations, Term | P3Y |
Commitments and Contingencies_3
Commitments and Contingencies - Paranthetical (Details) - USD ($) | May 30, 2020 | Jun. 01, 2019 |
Performance Guarantee | ||
Loss Contingencies [Line Items] | ||
Guarantor Obligations, Current Carrying Value | $ 0 | $ 0 |
Financial Standby Letter of Credit | ||
Loss Contingencies [Line Items] | ||
Guarantor Obligations, Current Carrying Value | $ 0 | $ 0 |
Operating Segments - Schedule o
Operating Segments - Schedule of Segment Reporting Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Segment Reporting Information | |||||||||||||||
Net sales | $ 475.7 | $ 665.7 | $ 674.2 | $ 670.9 | $ 671 | $ 619 | $ 652.6 | $ 624.6 | $ 618 | $ 578.4 | $ 604.6 | $ 580.3 | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Depreciation and Amortization | 79.5 | 72.1 | 66.9 | ||||||||||||
Operating earnings (loss) | (38.4) | 203.5 | 178.9 | ||||||||||||
Capital Expenditures | 69 | 85.8 | 70.6 | ||||||||||||
Total Assets | 2,053.9 | 1,569.3 | 1,479.5 | 2,053.9 | 1,569.3 | 1,479.5 | |||||||||
Goodwill | 346 | 303.8 | 304.1 | 346 | 303.8 | 304.1 | |||||||||
North America Contract | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Net sales | 1,598.2 | 1,686.5 | 1,589.8 | ||||||||||||
Depreciation and Amortization | 46.7 | 46.8 | 43.9 | ||||||||||||
Operating earnings (loss) | 130.9 | 189.7 | 175.2 | ||||||||||||
Capital Expenditures | 53.7 | 52.7 | 46 | ||||||||||||
Total Assets | 769.5 | 733.6 | 677.4 | 769.5 | 733.6 | 677.4 | |||||||||
Goodwill | 182.3 | 185.3 | 185.3 | 182.3 | 185.3 | 185.3 | |||||||||
International Contract | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Net sales | 502.8 | 492.2 | 434.5 | ||||||||||||
Depreciation and Amortization | 17.4 | 10.5 | 10.2 | ||||||||||||
Operating earnings (loss) | 18.2 | 57.8 | 36.9 | ||||||||||||
Capital Expenditures | 10.4 | 16.6 | 11.4 | ||||||||||||
Total Assets | 512.5 | 356.8 | 283.4 | 512.5 | 356.8 | 283.4 | |||||||||
Goodwill | 39.7 | 40 | 39.7 | 40 | |||||||||||
Retail | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Net sales | 385.6 | 388.5 | 356.9 | ||||||||||||
Depreciation and Amortization | 14.7 | 14.1 | 12.1 | ||||||||||||
Operating earnings (loss) | (148.3) | 5.3 | 13.9 | ||||||||||||
Capital Expenditures | 4.9 | 16.5 | 13.2 | ||||||||||||
Total Assets | 310.9 | 310 | 291.2 | 310.9 | 310 | 291.2 | |||||||||
Goodwill | 0 | 78.8 | 78.8 | 0 | 78.8 | 78.8 | |||||||||
Corporate | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Depreciation and Amortization | 0.7 | 0.7 | 0.7 | ||||||||||||
Operating earnings (loss) | (39.2) | (49.3) | (47.1) | ||||||||||||
Capital Expenditures | 0 | 0 | 0 | ||||||||||||
Total Assets | 461 | 168.9 | 227.5 | 461 | 168.9 | 227.5 | |||||||||
Goodwill | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Operating Segments - Revenue fr
Operating Segments - Revenue from External Customers by Products and Services (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Revenue from External Customer | |||||||||||||||
Net sales | $ 475.7 | $ 665.7 | $ 674.2 | $ 670.9 | $ 671 | $ 619 | $ 652.6 | $ 624.6 | $ 618 | $ 578.4 | $ 604.6 | $ 580.3 | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Systems | |||||||||||||||
Revenue from External Customer | |||||||||||||||
Net sales | 589.3 | 668 | 601.5 | ||||||||||||
Seating | |||||||||||||||
Revenue from External Customer | |||||||||||||||
Net sales | 1,041.6 | 1,013.5 | 965.9 | ||||||||||||
Freestanding and storage | |||||||||||||||
Revenue from External Customer | |||||||||||||||
Net sales | 496.9 | 505.4 | 465.1 | ||||||||||||
Textiles | |||||||||||||||
Revenue from External Customer | |||||||||||||||
Net sales | 138.8 | 113.8 | 94.3 | ||||||||||||
Other | |||||||||||||||
Revenue from External Customer | |||||||||||||||
Net sales | $ 220 | $ 266.5 | $ 254.4 |
Operating Segments - Schedule_2
Operating Segments - Schedule of Revenue by Customer Geographic Area (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Revenues from External Customers and Long-Lived Assets | |||||||||||||||
Net sales | $ 475.7 | $ 665.7 | $ 674.2 | $ 670.9 | $ 671 | $ 619 | $ 652.6 | $ 624.6 | $ 618 | $ 578.4 | $ 604.6 | $ 580.3 | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Long-lived assets | 366.3 | 474.3 | 399.8 | 366.3 | 474.3 | 399.8 | |||||||||
United States | |||||||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||||||
Net sales | 1,795.8 | 1,865.8 | 1,737.9 | ||||||||||||
Long-lived assets | 306.7 | 422.1 | 349.3 | 306.7 | 422.1 | 349.3 | |||||||||
International | |||||||||||||||
Revenues from External Customers and Long-Lived Assets | |||||||||||||||
Net sales | 690.8 | 701.4 | 643.3 | ||||||||||||
Long-lived assets | $ 59.6 | $ 52.2 | $ 50.5 | $ 59.6 | $ 52.2 | $ 50.5 |
Operating Segments (Details)
Operating Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Segment Reporting Information | |||||||||||||||
Net sales | $ 475.7 | $ 665.7 | $ 674.2 | $ 670.9 | $ 671 | $ 619 | $ 652.6 | $ 624.6 | $ 618 | $ 578.4 | $ 604.6 | $ 580.3 | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Distributor Concentration Risk | Sales Revenue, Net | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Concentration Risk, Percentage | 4.00% | ||||||||||||||
Customer Concentration Risk | Sales Revenue, Net | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Concentration Risk, Percentage | 5.00% | 5.00% | 5.00% | ||||||||||||
Net sales | $ 122.9 | $ 129.6 | $ 109.8 | ||||||||||||
Unionized Employees Concentration Risk | Workforce Subject to Collective Bargaining Arrangements | |||||||||||||||
Segment Reporting Information | |||||||||||||||
Concentration Risk, Percentage | 3.00% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 12 Months Ended | |||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | Jun. 03, 2018 | |
Cumulative translation adjustments [Roll Forward] | ||||
Cumulative translation adjustments at beginning of period | $ (48.3) | $ (34.1) | $ (36.8) | |
Other comprehensive (loss) income | (7.7) | (14.2) | 2.7 | |
Balance at end of period | (56) | (48.3) | (34.1) | |
Pension and other post-retirement benefit plans [Roll Forward] | ||||
Pension and other post-retirement benefit plans at beginning of period | (45) | (37.2) | 47.6 | |
Other comprehensive (loss) income before reclassifications (net of tax of $3.5, $2.0, and($2.9)) | 16.9 | 10 | (5.3) | |
Net reclassifications | 2.7 | 2.2 | 5.1 | |
Other Comprehensive Income (Loss), Net of Tax | 39.8 | 34.3 | (20.9) | |
Balance at end of period | (59.2) | (45) | (37.2) | |
Interest rate swap agreement [Roll Forward] | ||||
Interest rate swap agreement at beginning of period | (0.9) | 9.9 | 2.1 | |
Cumulative effect of accounting change | 683.9 | 712.7 | ||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (17.2) | (12.8) | 7.5 | |
Net reclassifications | (0.8) | 0.5 | 0.3 | |
Net current period other comprehensive (loss) income | (18) | (12.3) | 7.8 | |
Balance at end of period | (18.9) | (0.9) | 9.9 | |
Available for sale securities [Roll Forward] | ||||
Unrealized holding gains on securities at beginning of period | 0 | 0.1 | 0.1 | |
Cumulative effect of accounting change | 683.9 | 712.7 | ||
Other comprehensive income before reclassifications | 0.1 | 0 | 0 | |
Balance at end of period | 0.1 | 0 | 0.1 | |
Total Accumulated other comprehensive loss | (134) | (94.2) | (61.3) | |
Other, net | ||||
Pension and other post-retirement benefit plans [Roll Forward] | ||||
Reclassification from accumulated other comprehensive income - Other, net | 3.3 | 2.6 | 4.2 | |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | ||||
Pension and other post-retirement benefit plans [Roll Forward] | ||||
Tax (expense) benefit | (0.6) | (0.4) | 0.9 | |
Other Comprehensive Income (Loss), Net of Tax | (14.2) | (7.8) | 10.4 | |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent | Other, net | ||||
Interest rate swap agreement [Roll Forward] | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ (0.8) | $ 0.5 | $ 0.3 | |
Accounting Standards Update 2018-02 | ||||
Interest rate swap agreement [Roll Forward] | ||||
Cumulative effect of accounting change | $ 1.5 | |||
Available for sale securities [Roll Forward] | ||||
Cumulative effect of accounting change | 1.5 | |||
Accounting Standards Update 2016-01 | ||||
Interest rate swap agreement [Roll Forward] | ||||
Cumulative effect of accounting change | (0.1) | |||
Available for sale securities [Roll Forward] | ||||
Cumulative effect of accounting change | $ (0.1) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Phantom (Details) - Other, net - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, before Reclassification Adjustments and Tax | $ 3.5 | $ 2 | $ (2.9) |
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Tax | $ 5.8 | $ 5.3 | $ (5) |
Restructuring Expenses (Details
Restructuring Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | 24 Months Ended | 36 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | May 30, 2020 | May 30, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | $ 26.4 | $ 10.2 | $ 5.7 | ||
International Contract | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 4.8 | 2.5 | 3.9 | ||
North America Contract | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 18.7 | 7.7 | 1.8 | ||
Retail | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 2.9 | $ 0 | $ 0 | ||
Facilities Consolidation Plan | International Contract | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring & impairment expenses | 1.4 | $ 7.8 | |||
Assets Held-for-sale, Long Lived, Fair Value Disclosure | 7.8 | $ 7.8 | 7.8 | ||
Facilities Consolidation Plan | International Contract | Exit or Disposal Activities | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Effect on Future Earnings, Amount | 3 | ||||
Profit Improvement Plan | North America Contract | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Effect on Future Earnings, Amount | 10 | ||||
Restructuring expenses | 1.7 | 11.1 | |||
Nemschoff Plan | North America Contract | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 3.2 | ||||
Restructuring and Related Cost, Expected Cost | 5 | $ 5 | $ 5 | ||
North American Sales and Global Product Teams Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 2.6 | ||||
Retail Plan | Retail | Severance and employee related expenses | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring expenses | 2.2 | ||||
May 2020 Restructuring Plan | Severance and employee related expenses | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Effect on Future Earnings, Amount | 40 | ||||
Restructuring expenses | $ 15.3 |
Restructuring Expenses - Schedu
Restructuring Expenses - Schedule of Restructuring Rollforward (Details) - USD ($) $ in Millions | 12 Months Ended | 24 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | May 30, 2020 | |
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | $ 26.4 | $ 10.2 | $ 5.7 | |
North America Contract | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | 18.7 | 7.7 | 1.8 | |
International Contract | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | 4.8 | 2.5 | 3.9 | |
Retail | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Costs | 2.9 | 0 | 0 | |
Other Restructuring Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | (7.9) | 0 | $ 0 | |
Restructuring Costs | 11.1 | 10.2 | ||
Amounts Paid | (12.3) | (2.3) | ||
Ending Balance | (6.7) | (7.9) | 0 | (6.7) |
Other Restructuring Plans | Severance and employee related expenses | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | (6.8) | 0 | 0 | |
Restructuring Costs | 9.9 | 7 | ||
Amounts Paid | (10.8) | (0.2) | ||
Ending Balance | (5.9) | (6.8) | 0 | (5.9) |
Other Restructuring Plans | Exit or Disposal Activities | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | (1.1) | 0 | 0 | |
Restructuring Costs | 1.2 | 3.2 | ||
Amounts Paid | (1.5) | (2.1) | ||
Ending Balance | (0.8) | (1.1) | $ 0 | (0.8) |
May 2020 Restructuring Plan | Severance and employee related expenses | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Restructuring Costs | 15.3 | |||
Ending Balance | $ (15.3) | $ 0 | $ (15.3) |
Variable Interest Entites (Deta
Variable Interest Entites (Details) - USD ($) $ in Millions | May 30, 2020 | Jun. 01, 2019 |
Variable Interest Entity, Not Primary Beneficiary [Member] | Other Noncurrent Assets | ||
Variable Interest Entity [Line Items] | ||
Accounts and Financing Receivable, after Allowance for Credit Loss | $ 1.5 | $ 1.6 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
May 30, 2020 | Feb. 29, 2020 | Nov. 30, 2019 | Aug. 31, 2019 | Jun. 01, 2019 | Mar. 02, 2019 | Dec. 01, 2018 | Sep. 01, 2018 | Jun. 02, 2018 | Mar. 03, 2018 | Dec. 02, 2017 | Sep. 02, 2017 | May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Net sales | $ 475.7 | $ 665.7 | $ 674.2 | $ 670.9 | $ 671 | $ 619 | $ 652.6 | $ 624.6 | $ 618 | $ 578.4 | $ 604.6 | $ 580.3 | $ 2,486.6 | $ 2,567.2 | $ 2,381.2 |
Gross margin | 165.8 | 243.3 | 255.5 | 246.1 | 248.2 | 221 | 235.6 | 225.1 | 228.3 | 205.8 | 222.1 | 216.9 | 910.7 | 929.9 | 873 |
Net earnings attributable to Herman Miller, Inc. | $ (173.7) | $ 37.7 | $ 78.6 | $ 48.2 | $ 46.2 | $ 39.2 | $ 39.3 | $ 35.8 | $ 31.8 | $ 29.8 | $ 33.5 | $ 33.1 | $ (9.1) | $ 160.5 | $ 128.1 |
Earnings per share-basic | $ (2.95) | $ 0.64 | $ 1.33 | $ 0.82 | $ 0.78 | $ 0.67 | $ 0.66 | $ 0.60 | $ 0.53 | $ 0.50 | $ 0.56 | $ 0.55 | $ (0.15) | $ 2.72 | $ 2.15 |
Earnings per share-diluted | $ (2.95) | $ 0.64 | $ 1.32 | $ 0.81 | $ 0.78 | $ 0.66 | $ 0.66 | $ 0.60 | $ 0.53 | $ 0.49 | $ 0.55 | $ 0.55 | $ (0.15) | $ 2.70 | $ 2.12 |
Schedule II Valuation and Qua_2
Schedule II Valuation and Qualifying Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
May 30, 2020 | Jun. 01, 2019 | Jun. 02, 2018 | |
Allowance for Doubtful Accounts, Current | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | $ 2.9 | $ 2.4 | $ 2.3 |
Charges to expenses or net sales | 2.3 | 0.6 | 0.6 |
Deductions | (0.9) | (0.1) | (0.5) |
Balance at end of period | 4.3 | 2.9 | 2.4 |
Sales Returns and Allowances | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 0.6 | 0.5 | 0.4 |
Charges to expenses or net sales | 0 | 0 | 0.1 |
Deductions | (0.5) | 0.1 | 0 |
Balance at end of period | 0.1 | 0.6 | 0.5 |
Allowance for Doubtful Accounts, Noncurrent | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 0.3 | 0.4 | 0.9 |
Charges to expenses or net sales | 0 | (0.1) | (0.5) |
Deductions | 0 | 0 | 0 |
Balance at end of period | 0.3 | 0.3 | 0.4 |
Valuation Allowance of Deferred Tax Assets | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at beginning of period | 10.4 | 10.3 | 10 |
Charges to expenses or net sales | 0.4 | 0.4 | 0.5 |
Deductions | (0.2) | (0.3) | (0.2) |
Balance at end of period | $ 10.6 | $ 10.4 | $ 10.3 |
Uncategorized Items - hmi10k053
Label | Element | Value |
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | $ 1,900,000 |
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | (200,000) |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | 100,000 |
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | 500,000 |
Parent [Member] | ||
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | 1,900,000 |
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | (200,000) |
Additional Paid-in Capital [Member] | ||
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | (300,000) |
AOCI Attributable to Parent [Member] | ||
Cumulative Effect of New Accounting Principle | mlhr_CumulativeEffectofNewAccountingPrinciple | $ 1,400,000 |