UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☑						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~November 27, 2020~~May 28, 2021


or
☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ��to

Commission File Number 1-13873

STEELCASE INC.

(Exact name of registrant as specified in its charter)


Michigan		38-0819050
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
901 44th Street SE
Grand Rapids,	Michigan	49508
(Address of principal executive offices)		(Zip Code)

(616) 247-2710

(Registrant's telephone number, including area code)

None

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Class A Common Stock	SCS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of ~~December 18, 2020,~~June 22, 2021, Steelcase Inc. had ~~88,362,019~~90,582,958 shares of Class A Common Stock and ~~26,546,657~~25,096,994 shares of Class B Common Stock outstanding.

Table of Contents


STEELCASE INC. FORM 10-Q FOR THE QUARTERLY PERIOD ENDED ~~November 27, 2020~~May 28, 2021 INDEX


		Page No.

PART I	Financial Information	1
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Statements of ~~Income~~Operations for the Three ~~and~~ ~~Nine~~Months Ended ~~November 27~~,May 28, 2021 and May 29, 2020 ~~and~~ ~~November 22, 2019~~	1
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three ~~and~~ ~~Nine~~Months Ended ~~November 27~~,May 28, 2021 and May 29, 2020 ~~and~~ ~~November 22, 2019~~	2
	Condensed Consolidated Balance Sheets as of ~~November 27~~, ~~2020~~May 28, 2021 and February ~~28, 2020~~26, 2021	3
	Condensed Consolidated Statements of Changes in Shareholders' Equity for the Three ~~and~~ ~~Nine~~Months Ended ~~November 27~~,May 28, 2021 and May 29, 2020 ~~and~~ ~~November 22, 2019~~	4
	Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~November 27~~,May 28, 2021 and May 29, 2020 ~~and~~ ~~November 22, 2019~~	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1716
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2724
Item 4.	Controls and Procedures	2824

PART II	Other Information	2824
Item 1A.	Risk Factors	2824
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2924
Item 6.	Exhibits	3026
Signatures		3127

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1.Financial Statements:

STEELCASE INC.

CONDENSED CONSOLIDATED STATEMENTS OF ~~INCOME~~OPERATIONS (Unaudited)

(in millions, except per share data)


		Three Months Ended				Nine Months Ended					Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			May 28, 2021		May 29, 2020
Revenue	Revenue	$	617.5	$	955.2	$	1,919.1	$	2,777.5	Revenue	$	556.6	$	482.8
Cost of sales	Cost of sales	437.3		639.1		1,339.7		1,869.5		Cost of sales	401.9		360.1
Restructuring costs		2.3		0		9.2		0

Gross profit	Gross profit	177.9		316.1		570.2		908.0		Gross profit	154.7		122.7
Operating expenses	Operating expenses	168.8		241.0		498.5		720.0		Operating expenses	186.5		157.4
Goodwill impairment charge	Goodwill impairment charge	0		0		17.6		0		Goodwill impairment charge	0		17.6
Restructuring costs		9.1		0		17.8		0
Operating income		0		75.1		36.3		188.0

Operating loss										Operating loss	(31.8)		(52.3)
Interest expense	Interest expense	(6.6)		(6.7)		(20.7)		(20.1)		Interest expense	(6.4)		(7.3)
Investment income	Investment income	0.2		1.3		1.2		3.8		Investment income	0.2		0.8
Other income, net		2.2		4.1		7.0		8.3
Income (loss) before income tax expense (benefit)		(4.2)		73.8		23.8		180.0
Income tax expense (benefit)		(6.3)		18.9		4.3		46.8
Net income		$	2.1	$	54.9	$	19.5	$	133.2
Earnings per share:
Other income (expense), net										Other income (expense), net	(0.8)		4.0
Loss before income tax benefit										Loss before income tax benefit	(38.8)		(54.8)
Income tax benefit										Income tax benefit	(10.7)		(16.7)
Net loss										Net loss	$	(28.1)	$	(38.1)
Earnings (loss) per share:										Earnings (loss) per share:
Basic	Basic	$	0.02	$	0.46	$	0.17	$	1.11	Basic	$	(0.24)	$	(0.33)
Diluted	Diluted	$	0.02	$	0.46	$	0.17	$	1.11	Diluted	$	(0.24)	$	(0.33)
Dividends declared and paid per common share	Dividends declared and paid per common share	$	0.100	$	0.145	$	0.270	$	0.435	Dividends declared and paid per common share	$	0.100	$	0.070

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

STEELCASE INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)

(in millions)


		Three Months Ended				Nine Months Ended					Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			May 28, 2021		May 29, 2020
Net income		$	2.1	$	54.9	$	19.5	$	133.2
Net loss										Net loss	$	(28.1)	$	(38.1)
Other comprehensive income (loss), net:	Other comprehensive income (loss), net:									Other comprehensive income (loss), net:
Unrealized gain (loss) on investments	Unrealized gain (loss) on investments	0.3		(0.1)		0.2		(0.2)		Unrealized gain (loss) on investments	0.2		(0.2)
Pension and other post-retirement liability adjustments	Pension and other post-retirement liability adjustments	(0.3)		(1.1)		(1.1)		(1.6)		Pension and other post-retirement liability adjustments	(0.1)		0.3
Derivative amortization	Derivative amortization	0.3		0.3		0.7		0.7		Derivative amortization	0.2		0.2
Foreign currency translation adjustments	Foreign currency translation adjustments	7.2		6.4		20.7		(7.9)		Foreign currency translation adjustments	0.9		(8.9)
Total other comprehensive income (loss), net	Total other comprehensive income (loss), net	7.5		5.5		20.5		(9.0)		Total other comprehensive income (loss), net	1.2		(8.6)
Comprehensive income		$	9.6	$	60.4	$	40.0	$	124.2
Comprehensive loss										Comprehensive loss	$	(26.9)	$	(46.7)

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

STEELCASE INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions)


		(Unaudited)					(Unaudited)
		November 27, 2020		February 28, 2020			May 28, 2021		February 26, 2021
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	484.4	$	541.0	Cash and cash equivalents	$	397.2	$	489.8

Accounts receivable	Accounts receivable	283.6		381.8		Accounts receivable	269.4		279.0
Allowance for doubtful accounts	Allowance for doubtful accounts	(9.3)		(9.4)		Allowance for doubtful accounts	(9.1)		(8.7)
Inventories	Inventories	235.0		215.0		Inventories	227.6		193.5

Prepaid expenses	Prepaid expenses	19.3		21.6		Prepaid expenses	24.9		20.9

Income taxes receivable						Income taxes receivable	59.0		49.5
Other current assets	Other current assets	71.8		38.8		Other current assets	23.1		21.4
Total current assets	Total current assets	1,084.8		1,188.8		Total current assets	992.1		1,045.4
Property, plant and equipment, net of accumulated depreciation of $1,040.2 and $977.7		415.3		426.3
Property, plant and equipment, net of accumulated depreciation of $1,079.5 and $1,063.2						Property, plant and equipment, net of accumulated depreciation of $1,079.5 and $1,063.2	412.3		410.8
Company-owned life insurance ("COLI")	Company-owned life insurance ("COLI")	167.7		160.0		Company-owned life insurance ("COLI")	168.9		169.5
Deferred income taxes	Deferred income taxes	110.9		124.6		Deferred income taxes	115.3		113.3
Goodwill	Goodwill	215.3		233.6		Goodwill	218.4		218.1
Other intangible assets, net of accumulated amortization of $68.8 and $56.7		91.3		102.9
Other intangible assets, net of accumulated amortization of $77.0 and $73.3						Other intangible assets, net of accumulated amortization of $77.0 and $73.3	86.8		90.4
Investments in unconsolidated affiliates	Investments in unconsolidated affiliates	55.4		52.3		Investments in unconsolidated affiliates	51.3		51.5
Right-of-use operating lease assets	Right-of-use operating lease assets	213.1		237.9		Right-of-use operating lease assets	216.8		225.4
Other assets	Other assets	31.5		39.0		Other assets	27.7		29.6
Total assets	Total assets	$	2,385.3	$	2,565.4	Total assets	$	2,289.6	$	2,354.0
LIABILITIES AND SHAREHOLDERS’ EQUITY	LIABILITIES AND SHAREHOLDERS’ EQUITY					LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	200.8	$	244.3	Accounts payable	$	199.3	$	181.3
Short-term borrowings and current portion of long-term debt	Short-term borrowings and current portion of long-term debt	2.6		2.9		Short-term borrowings and current portion of long-term debt	5.0		4.7
Current operating lease obligations	Current operating lease obligations	41.9		43.1		Current operating lease obligations	43.3		43.8
Accrued expenses:	Accrued expenses:					Accrued expenses:
Employee compensation	Employee compensation	95.2		191.7		Employee compensation	61.7		90.1
Employee benefit plan obligations	Employee benefit plan obligations	24.0		44.7		Employee benefit plan obligations	15.6		24.9
Accrued promotions	Accrued promotions	30.4		35.3		Accrued promotions	25.2		27.8
Customer deposits	Customer deposits	59.9		28.6		Customer deposits	42.2		33.7

Other	Other	114.2		100.3		Other	105.9		108.7
Total current liabilities	Total current liabilities	569.0		690.9		Total current liabilities	498.2		515.0
Long-term liabilities:	Long-term liabilities:					Long-term liabilities:
Long-term debt less current maturities	Long-term debt less current maturities	480.2		481.4		Long-term debt less current maturities	478.7		479.2
Employee benefit plan obligations	Employee benefit plan obligations	147.9		148.3		Employee benefit plan obligations	144.9		152.9
Long-term operating lease obligations	Long-term operating lease obligations	191.4		214.0		Long-term operating lease obligations	191.2		199.5
Other long-term liabilities	Other long-term liabilities	49.0		60.4		Other long-term liabilities	46.3		46.9
Total long-term liabilities	Total long-term liabilities	868.5		904.1		Total long-term liabilities	861.1		878.5
Total liabilities	Total liabilities	1,437.5		1,595.0		Total liabilities	1,359.3		1,393.5
Shareholders’ equity:	Shareholders’ equity:					Shareholders’ equity:

Additional paid-in capital	Additional paid-in capital	3.5		28.4		Additional paid-in capital	21.3		12.5
Accumulated other comprehensive income (loss)	Accumulated other comprehensive income (loss)	(48.8)		(69.3)		Accumulated other comprehensive income (loss)	(38.8)		(40.0)
Retained earnings	Retained earnings	993.1		1,011.3		Retained earnings	947.8		988.0
Total shareholders’ equity	Total shareholders’ equity	947.8		970.4		Total shareholders’ equity	930.3		960.5
Total liabilities and shareholders’ equity	Total liabilities and shareholders’ equity	$	2,385.3	$	2,565.4	Total liabilities and shareholders’ equity	$	2,289.6	$	2,354.0

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

STEELCASE INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

(in millions, except share and per share data)


		Three Months Ended				Nine Months Ended					Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			May 28, 2021		May 29, 2020
Changes in common shares outstanding:	Changes in common shares outstanding:									Changes in common shares outstanding:
Common shares outstanding, beginning of period	Common shares outstanding, beginning of period	114,776,546		117,243,960		117,202,000		116,766,610		Common shares outstanding, beginning of period	114,908,676		117,202,000
Common stock issuances	Common stock issuances	21,351		10,167		48,241		33,039		Common stock issuances	13,093		12,949
Common stock repurchases	Common stock repurchases	(44,201)		(177,123)		(3,288,795)		(524,379)		Common stock repurchases	(353,196)		(3,244,389)
Performance units issued as common stock		0		0		174,888		0
Restricted units issued as common stock		139,114		116,094		756,476		917,828
Performance and restricted stock units issued as common stock										Performance and restricted stock units issued as common stock	1,095,826		788,989
Common shares outstanding, end of period	Common shares outstanding, end of period	114,892,810		117,193,098		114,892,810		117,193,098		Common shares outstanding, end of period	115,664,399		114,759,549

Changes in paid-in capital (1):
Paid-in capital, beginning of period		$	1.7	$	26.5	$	28.4	$	16.4
Changes in additional paid-in capital (1):										Changes in additional paid-in capital (1):
Additional paid-in capital, beginning of period										Additional paid-in capital, beginning of period	$	12.5	$	28.4
Common stock issuances	Common stock issuances	0.2		0.2		0.6		0.6		Common stock issuances	0.2		0.2
Common stock repurchases	Common stock repurchases	(0.4)		(2.8)		(36.8)		(8.7)		Common stock repurchases	(4.3)		(36.4)
Performance units and restricted stock units expense		2.0		2.1		11.3		13.7
Other		0		0		0		4.0
Paid-in capital, end of period		3.5		26.0		3.5		26.0
Performance and restricted stock units expense										Performance and restricted stock units expense	12.9		7.8
Additional paid-in capital, end of period										Additional paid-in capital, end of period	21.3		0

Changes in accumulated other comprehensive income (loss):	Changes in accumulated other comprehensive income (loss):									Changes in accumulated other comprehensive income (loss):
Accumulated other comprehensive income (loss), beginning of period	Accumulated other comprehensive income (loss), beginning of period	(56.3)		(61.8)		(69.3)		(47.3)		Accumulated other comprehensive income (loss), beginning of period	(40.0)		(69.3)
Other comprehensive income (loss)	Other comprehensive income (loss)	7.5		5.5		20.5		(9.0)		Other comprehensive income (loss)	1.2		(8.6)

Accumulated other comprehensive income (loss), end of period	Accumulated other comprehensive income (loss), end of period	(48.8)		(56.3)		(48.8)		(56.3)		Accumulated other comprehensive income (loss), end of period	(38.8)		(77.9)

Changes in retained earnings:	Changes in retained earnings:									Changes in retained earnings:
Retained earnings, beginning of period	Retained earnings, beginning of period	1,002.7		924.5		1,011.3		880.7		Retained earnings, beginning of period	988.0		1,011.3
Net income		2.1		54.9		19.5		133.2
Net loss										Net loss	(28.1)		(38.1)
Dividends paid	Dividends paid	(11.7)		(17.4)		(31.8)		(51.9)		Dividends paid	(12.1)		(8.4)
Common stock repurchases	Common stock repurchases	—		0		(5.9)		0		Common stock repurchases	—		(5.9)
Retained earnings, end of period	Retained earnings, end of period	993.1		962.0		993.1		962.0		Retained earnings, end of period	947.8		958.9
Total shareholders' equity	Total shareholders' equity	$	947.8	$	931.7	$	947.8	$	931.7	Total shareholders' equity	$	930.3	$	881.0

(1)Shares of our Class A and Class B common stock have no par value; thus, there are no balances for common stock.

See accompanying notes to the condensed consolidated financial statements.

Table of Contents

STEELCASE INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in millions)


		Nine Months Ended					Three Months Ended
		November 27, 2020		November 22, 2019			May 28, 2021		May 29, 2020
OPERATING ACTIVITIES	OPERATING ACTIVITIES					OPERATING ACTIVITIES
Net income		$	19.5	$	133.2
Net loss						Net loss	$	(28.1)	$	(38.1)
Depreciation and amortization	Depreciation and amortization	64.1		62.9		Depreciation and amortization	20.7		22.5
Goodwill impairment charge	Goodwill impairment charge	17.6		0		Goodwill impairment charge	0		17.6

Restructuring costs		27.0		0

Deferred income taxes	Deferred income taxes	17.9		13.9		Deferred income taxes	(2.3)		12.4

Non-cash stock compensation	Non-cash stock compensation	11.9		14.3		Non-cash stock compensation	13.1		8.0

Equity in income of unconsolidated affiliates	Equity in income of unconsolidated affiliates	(6.7)		(9.9)		Equity in income of unconsolidated affiliates	(1.3)		(1.8)
Dividends received from unconsolidated affiliates	Dividends received from unconsolidated affiliates	5.2		8.8		Dividends received from unconsolidated affiliates	1.5		0.7
Other	Other	(12.4)		(3.6)		Other	(2.6)		(2.8)
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:					Changes in operating assets and liabilities:
Accounts receivable	Accounts receivable	105.2		(60.8)		Accounts receivable	10.1		115.8
Inventories	Inventories	(16.4)		(25.2)		Inventories	(34.2)		(32.8)

Other assets	Other assets	(22.9)		12.1		Other assets	(14.1)		(28.0)
Accounts payable	Accounts payable	(47.0)		41.6		Accounts payable	17.8		(87.8)
Employee compensation liabilities	Employee compensation liabilities	(130.5)		(8.8)		Employee compensation liabilities	(36.0)		(137.2)

Employee benefit obligations	Employee benefit obligations	(25.2)		(5.7)		Employee benefit obligations	(18.1)		(33.2)
Customer deposits	Customer deposits	30.4		6.2		Customer deposits	8.4		94.9

Accrued expenses and other liabilities	Accrued expenses and other liabilities	(0.5)		39.8		Accrued expenses and other liabilities	1.5		(3.6)
Net cash provided by operating activities		37.2		218.8
Net cash used in operating activities						Net cash used in operating activities	(63.6)		(93.4)
INVESTING ACTIVITIES	INVESTING ACTIVITIES					INVESTING ACTIVITIES
Capital expenditures	Capital expenditures	(32.1)		(49.1)		Capital expenditures	(18.4)		(9.4)
Proceeds from disposal of fixed assets		7.3		1.0

Other	Other	7.0		2.0		Other	5.4		6.7
Net cash used in investing activities	Net cash used in investing activities	(17.8)		(46.1)		Net cash used in investing activities	(13.0)		(2.7)
FINANCING ACTIVITIES	FINANCING ACTIVITIES					FINANCING ACTIVITIES
Dividends paid	Dividends paid	(31.8)		(51.9)		Dividends paid	(12.1)		(8.4)
Common stock repurchases	Common stock repurchases	(42.7)		(8.7)		Common stock repurchases	(4.3)		(42.3)

Borrowings on lines of credit		250.0		0
Repayments on lines of credit		(250.0)		0
Borrowings on global committed bank facility						Borrowings on global committed bank facility	0		250.0
Repayments on global committed bank facility						Repayments on global committed bank facility	0		(5.0)

Other	Other	(2.1)		(3.5)		Other	(0.4)		(0.6)
Net cash used in financing activities		(76.6)		(64.1)
Net cash provided by (used in) financing activities						Net cash provided by (used in) financing activities	(16.8)		193.7
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	1.8		(0.8)		Effect of exchange rate changes on cash and cash equivalents	0.3		(1.3)
Net increase (decrease) in cash, cash equivalents and restricted cash	Net increase (decrease) in cash, cash equivalents and restricted cash	(55.4)		107.8		Net increase (decrease) in cash, cash equivalents and restricted cash	(93.1)		96.3
Cash and cash equivalents and restricted cash, beginning of period (1)	Cash and cash equivalents and restricted cash, beginning of period (1)	547.1		264.8		Cash and cash equivalents and restricted cash, beginning of period (1)	495.6		547.1
Cash and cash equivalents and restricted cash, end of period (2)	Cash and cash equivalents and restricted cash, end of period (2)	$	491.7	$	372.6	Cash and cash equivalents and restricted cash, end of period (2)	$	402.5	$	643.4

(1)These amounts include restricted cash of ~~$6.1~~$5.8 and ~~$3.5~~$6.1 as of February ~~28, 2020~~26, 2021 and February ~~22, 2019,~~28, 2020, respectively.

(2)These amounts include restricted cash of ~~$7.3~~$5.3 and ~~$4.9~~$5.9 as of ~~November 27,~~May 28, 2021 and May 29, 2020, ~~and November 22, 2019,~~ respectively.

Restricted cash primarily represents funds held in escrow for potential future workers’ compensation and product liability claims. Restricted cash is included as part of Other assets in the Condensed Consolidated Balance Sheets.

See accompanying notes to the condensed consolidated financial statements.

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.BASIS OF PRESENTATION

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions in Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals and adjustments) considered necessary for a fair presentation of the condensed consolidated financial statements have been included. Results for interim periods should not be considered indicative of results to be expected for a full year. Reference should be made to the consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the fiscal year ended February ~~28, 2020~~26, 2021 (“Form 10-K”). The Condensed Consolidated Balance Sheet as of February ~~28, 2020~~26, 2021 was derived from the audited Consolidated Balance Sheet included in our Form 10-K.

As used in this Quarterly Report on Form 10-Q (“Report”), unless otherwise expressly stated or the context otherwise requires, all references to “Steelcase,” “we,” “our,” “Company” and similar references are to Steelcase Inc. and its subsidiaries in which a controlling interest is maintained. Unless the context otherwise indicates, reference to a year relates to the fiscal year, ended in February of the year indicated, rather than a calendar year. Additionally, Q1, Q2, Q3 and Q4 reference the first, second, third and fourth quarter, respectively, of the fiscal year indicated. All amounts are in millions, except share and per share data, data presented as a percentage or as otherwise indicated.

2.NEW ACCOUNTING STANDARDS

~~Adoption of New~~We evaluate all Accounting Standards

~~In December 2019,~~ Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB") ~~issued Accounting Standards Update ("ASU") No. 2019-12,~~ ~~Income Taxes (Topic 740), which is intended~~for consideration of their applicability to enhance various aspects of the accounting for income taxes. The new guidance updates the calculation of income taxes in an interim period when year-to-date losses exceed the anticipated loss for the year. We adopted this guidance in Q1 2021 on a prospective basis. The adoption of this guidance did not have a material effect on our consolidated financial statements.

~~In June 2016, the FASB issued ASU No. 2016-13,~~ ~~Financial Instruments - Credit Losses (Topic 326)~~, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses. We adopted this guidance in Q1 2021 using a modified retrospective transition approach. The adoption of this guidance did not have a material effect on our consolidated financial statements. We ~~estimate our allowance for doubtful accounts based upon several factors, including customer credit quality~~have assessed all ASUs issued but not yet adopted and historical write-off trends. We also use general information regarding industry trends, the economic environment and information gathered through our network of field-based employees. The adoption of this guidance didconcluded that those not ~~significantly impact our accounting policies~~disclosed are either not applicable to us or ~~methods utilized to determine the allowance for doubtful accounts.~~

~~Accounting Standards Issued But Not Yet Adopted~~

~~In August 2018, the FASB issued ASU No. 2018-14,~~ ~~Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans, which amends ASC 715-20,~~ ~~Compensation - Retirement Benefits - Defined Benefit Plans - General~~. The amended guidance modifies the disclosure requirements for employers that sponsor defined benefit pension or other post-retirement plans by removing and adding certain disclosures for these plans. The eliminated disclosures include (a) the amounts in accumulated other comprehensive income expected to be recognized in net periodic benefit costs over the next fiscal year and (b) the effects of a one percentage point change in assumed health care cost trend rates on the net periodic benefit costs and the benefit obligation for post-retirement health care benefits. Additional disclosures include descriptions of significant gains and losses affecting the benefit obligation for the period. The amended guidance is effective for fiscal years ending after December 15, 2020. The adoption of this guidance will modify our disclosures but isare not expected to have a material effect on our consolidated financial statements.

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

3.REVENUE

Disaggregation of Revenue

The following table provides information about disaggregated revenue by product category for each of our reportable segments:


Product Category Data	Product Category Data	Three Months Ended				Nine Months Ended				Product Category Data	Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			May 28, 2021		May 29, 2020
Americas	Americas									Americas
Desking, benching, systems and storage	Desking, benching, systems and storage	$	202.8	$	351.7	$	681.9	$	1,058.5	Desking, benching, systems and storage	$	185.1	$	168.4
Seating	Seating	121.3		197.3		412.8		588.6		Seating	118.2		96.5
Other (1)	Other (1)	92.3		141.9		286.8		359.6		Other (1)	73.0		69.0
EMEA	EMEA									EMEA
Desking, benching, systems and storage	Desking, benching, systems and storage	48.5		66.1		140.3		187.0		Desking, benching, systems and storage	54.8		43.9
Seating	Seating	61.7		60.7		138.5		174.0		Seating	33.9		31.0
Other (1)	Other (1)	33.1		41.6		89.9		122.9		Other (1)	34.9		24.6
Other	Other									Other
Desking, benching, systems and storage	Desking, benching, systems and storage	12.4		16.7		33.5		46.9		Desking, benching, systems and storage	10.8		10.7
Seating	Seating	17.2		21.4		48.1		65.3		Seating	14.5		12.2
Other (1)	Other (1)	28.2		57.8		87.3		174.7		Other (1)	31.4		26.5
		$	617.5	$	955.2	$	1,919.1	$	2,777.5		$	556.6	$	482.8

(1)The Other product category data ~~by segment~~ consists primarily of products sold by consolidated dealers, textiles and surface materials, worktools, architecture, technology and other uncategorized product lines and services.

Reportable geographic information is as follows:


Reportable Geographic Revenue	Reportable Geographic Revenue	Three Months Ended				Nine Months Ended				Reportable Geographic Revenue	Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			Reportable Geographic Revenue	May 28, 2021			May 29, 2020
United States	United States	$	392.9	$	705.4	$	1,314.0	$	1,922.1				United States	$	359.3			$	323.5
Foreign locations	Foreign locations	224.6		249.8		605.1		855.4						Foreign locations		197.3				159.3
		$	617.5	$	955.2	$	1,919.1	$	2,777.5							$	556.6			$	482.8

Contract Balances

At times, we receive payments from customers before revenue is recognized, resulting in the recognition of a contract liability (Customer deposits) presented in the Condensed Consolidated Balance Sheets.

Changes in the Customer deposits balance during the ~~nine~~three months ended ~~November 27, 2020~~May 28, 2021 are as follows:


	Customer Deposits
Balance as of February ~~28, 2020~~26, 2021	$	~~28.6~~33.7
Recognition of revenue related to beginning of year customer deposits	~~(25.7)~~(18.3)
Customer deposits received, net of revenue recognized during the period	~~57.0~~26.8
Balance as of ~~November 27, 2020~~May 28, 2021	$	~~59.9~~42.2

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

4.EARNINGS (LOSS) PER SHARE

Earnings (loss) per share is computed using the two-class method. The two-class method determines earnings (loss) per share for each class of common stock and participating securities according to dividends or dividend equivalents and their respective participation rights in undistributed earnings. Participating securities represent restricted stock units in which the participants have non-forfeitable rights to dividend equivalents during the performance period. Diluted earnings (loss) per share includes the effects of certain performance units in which the participants have forfeitable rights to dividend equivalents during the performance period.

Three Months Ended Nine Months Ended
Computation of Earnings per Share November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Net income $ 2.1 $ 54.9 $ 19.5 $ 133.2
Adjustment for earnings attributable to participating securities 0 (1.1) (0.4) (2.6)
Net income used in calculating earnings per share $ 2.1 $ 53.8 $ 19.1 $ 130.6
Weighted-average common shares outstanding including participating securities (in millions) 117.7 119.5 117.4 119.6
Adjustment for participating securities (in millions) (2.9) (2.3) (2.5) (2.3)
Shares used in calculating basic earnings per share (in millions) 114.8 117.2 114.9 117.3
Effect of dilutive stock-based compensation (in millions) 0.3 0.6 0.3 0.5
Shares used in calculating diluted earnings per share (in millions) 115.1 117.8 115.2 117.8
Earnings per share:
Basic $ 0.02 $ 0.46 $ 0.17 $ 1.11
Diluted $ 0.02 $ 0.46 $ 0.17 $ 1.11
Total common shares outstanding at period end (in millions) 114.9 117.2 114.9 117.2
Anti-dilutive performance units excluded from the computation of diluted earnings per share (in millions) 0 0 0 0


Computation of Earnings (Loss) Per Share	Three Months Ended May 28, 2021
	Net Loss		Basic Shares (in millions)		Diluted Shares (in millions)
Unadjusted amounts	$	(28.1)	118.3		118.3
Adjustment for participating securities	0.6		(2.7)		(2.7)
Amounts used in calculating earnings (loss) per share	$	(27.5)	115.6		115.6

Earnings (loss) per share			$	(0.24)	$	(0.24)


Computation of Earnings (Loss) Per Share	Three Months Ended May 29, 2020
	Net Loss		Basic Shares (in millions)		Diluted Shares (in millions)
Unadjusted amounts	$	(38.1)	117.3		117.3
Adjustment for participating securities	0.7		(2.2)		(2.2)
Amounts used in calculating earnings (loss) per share	$	(37.4)	115.1		115.1

Earnings (loss) per share			$	(0.33)	$	(0.33)

Anti-dilutive performance units excluded from the computation of diluted earnings (loss) per share were 0.5 million and 0.3 million as of May 28, 2021 and May 29, 2020, respectively. Total common shares outstanding were 115.7 million and 114.8 million as of May 28, 2021 and May 29, 2020, respectively.

5.ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the three months ended ~~November 27, 2020:~~May 28, 2021:

Unrealized gain (loss) on investments Pension and other post-retirement liability adjustments Derivative amortization Foreign currency translation adjustments Total
Balance as of August 28, 2020 $ (0.2) $ (3.9) $ (8.2) $ (44.0) $ (56.3)
Other comprehensive income (loss) before reclassifications 0.3 (0.1) 0 7.2 7.4
Amounts reclassified from accumulated other comprehensive income (loss) 0 (0.2) 0.3 0 0.1
Net current period other comprehensive income (loss) 0.3 (0.3) 0.3 7.2 7.5
Balance as of November 27, 2020 $ 0.1 $ (4.2) $ (7.9) $ (36.8) $ (48.8)


	Unrealized gain (loss) on investments		Pension and other post-retirement liability adjustments		Derivative amortization		Foreign currency translation adjustments		Total
Balance as of February 26, 2021	$	0.3	$	(6.6)	$	(7.6)	$	(26.1)	$	(40.0)
Other comprehensive income (loss) before reclassifications	0.2		0		0		0.9		1.1
Amounts reclassified from accumulated other comprehensive income (loss)	0		(0.1)		0.2		0		0.1
Net other comprehensive income (loss) during the period	0.2		(0.1)		0.2		0.9		1.2
Balance as of May 28, 2021	$	0.5	$	(6.7)	$	(7.4)	$	(25.2)	$	(38.8)

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following table ~~summarizes the changes in accumulated balances of other comprehensive income (loss) for the nine months ended November 27, 2020:~~

Unrealized gain (loss) on investments Pension and other post-retirement liability adjustments Derivative amortization Foreign currency translation adjustments Total
Balance as of February 28, 2020 $ (0.1) $ (3.1) $ (8.6) $ (57.5) $ (69.3)
Other comprehensive income (loss) before reclassifications 0.2 (0.4) 0 20.7 20.5
Amounts reclassified from accumulated other comprehensive income (loss) 0 (0.7) 0.7 0 0
Net current period other comprehensive income (loss) 0.2 (1.1) 0.7 20.7 20.5
Balance as of November 27, 2020 $ 0.1 $ (4.2) $ (7.9) $ (36.8) $ (48.8)

~~The following table~~ provides details about reclassifications out of accumulated other comprehensive income (loss) for the three ~~and nine~~ months ended ~~November 27, 2020~~May 28, 2021 and ~~November 22, 2019:~~May 29, 2020:

Detail of Accumulated Other
Comprehensive Income (Loss) Components Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) Affected Line in the Condensed Consolidated Statements of Income
Three Months Ended Nine Months Ended
November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Amortization of pension and other post-retirement liability adjustments
Actuarial losses (gains) $ (0.3) $ (0.8) $ (0.9) $ (2.3) Other income, net
Prior service cost (credit) 0 (0.1) (0.1) (0.2) Other income, net
0.1 0.4 0.3 0.7 Income tax expense (benefit)
(0.2) (0.5) (0.7) (1.8)
Derivative amortization 0.4 0.4 1.0 1.0 Interest expense
(0.1) (0.1) (0.3) (0.3) Income tax expense (benefit)
0.3 0.3 0.7 0.7
Realized gain on sale of investment 0 0 0 (0.7) Investment income
0 0 0 0.2 Income tax expense (benefit)
0 0 0 (0.5)
Total reclassifications $ 0.1 $ (0.2) $ 0 $ (1.6)


Detail of Accumulated Other Comprehensive Income (Loss) Components	Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)				Affected Line in the Condensed Consolidated Statements of Operations
	Three Months Ended
	May 28, 2021		May 29, 2020

Amortization of pension and other post-retirement actuarial losses (gains)	$	(0.1)	$	(0.3)		Other income (expense), net

Income tax expense	0		0.1			Income tax benefit
	(0.1)		(0.2)

Derivative amortization	0.3		0.3			Interest expense
Income tax benefit	(0.1)		(0.1)			Income tax benefit
	0.2		0.2





Total reclassifications	$	0.1	$	0

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

6.FAIR VALUE

The carrying amounts for many of our financial instruments, including cash and cash equivalents, accounts and notes receivable, accounts and notes payable, short-term borrowings and certain other liabilities, approximate their fair value due to their relatively short maturities. Our foreign exchange forward contracts and long-term investments are measured at fair value in the Condensed Consolidated Balance Sheets.

Our total debt is carried at cost and was ~~$482.8~~$483.7 and ~~$484.3~~$483.9 as of ~~November 27, 2020~~May 28, 2021 and February ~~28, 2020,~~26, 2021, respectively. The fair value of our total debt is measured using a discounted cash flow analysis based on current market interest rates for similar types of instruments and was ~~$556.7~~$566.8 and ~~$560.0~~$568.1 as of ~~November 27, 2020~~May 28, 2021 and February ~~28, 2020,~~26, 2021, respectively. The estimation of the fair value of our total debt is based on Level 2 fair value measurements.

We periodically use derivative financial instruments to manage exposures to movements in foreign exchange rates and interest rates. The use of these financial instruments modifies the exposure of these risks with the intention to reduce our risk of short-term volatility. We do not use derivatives for speculative or trading purposes.

Assets and liabilities measured at fair value as of ~~November 27, 2020~~May 28, 2021 and February ~~28, 2020~~26, 2021 are summarized below:


		November 27, 2020									May 28, 2021
Fair Value of Financial Instruments	Fair Value of Financial Instruments	Level 1		Level 2		Level 3		Total		Fair Value of Financial Instruments	Level 1		Level 2		Level 3		Total
Assets:	Assets:									Assets:
Cash and cash equivalents	Cash and cash equivalents	$	484.4	$	0	$	0	$	484.4	Cash and cash equivalents	$	397.2	$	0	$	0	$	397.2
Restricted cash	Restricted cash	7.3		0		0		7.3		Restricted cash	5.3		0		0		5.3

Foreign exchange forward contracts	Foreign exchange forward contracts	0		3.1		0		3.1		Foreign exchange forward contracts	0		0.8		0		0.8
Auction rate securities		0		0		2.4		2.4
Auction rate security										Auction rate security	0		0		2.8		2.8

		$	491.7	$	3.1	$	2.4	$	497.2		$	402.5	$	0.8	$	2.8	$	406.1
Liabilities:	Liabilities:									Liabilities:
Foreign exchange forward contracts	Foreign exchange forward contracts	$	0	$	(0.8)	$	0	$	(0.8)	Foreign exchange forward contracts	$	0	$	(0.5)	$	0	$	(0.5)
		$	0	$	(0.8)	$	0	$	(0.8)

											$	0	$	(0.5)	$	0	$	(0.5)

		February 28, 2020									February 26, 2021
Fair Value of Financial Instruments	Fair Value of Financial Instruments	Level 1		Level 2		Level 3		Total		Fair Value of Financial Instruments	Level 1		Level 2		Level 3		Total
Assets:	Assets:									Assets:
Cash and cash equivalents	Cash and cash equivalents	$	541.0	$	0	$	0	$	541.0	Cash and cash equivalents	$	489.8	$	0	$	0	$	489.8
Restricted cash	Restricted cash	6.1		0		0		6.1		Restricted cash	5.8		0		0		5.8

Foreign exchange forward contracts	Foreign exchange forward contracts	0		1.2		0		1.2		Foreign exchange forward contracts	0		1.1		0		1.1
Auction rate securities		0		0		2.1		2.1
Auction rate security										Auction rate security	0		0		2.6		2.6

		$	547.1	$	1.2	$	2.1	$	550.4		$	495.6	$	1.1	$	2.6	$	499.3
Liabilities:	Liabilities:									Liabilities:
Foreign exchange forward contracts	Foreign exchange forward contracts	$	0	$	(0.5)	$	0	$	(0.5)	Foreign exchange forward contracts	$	0	$	(0.8)	$	0	$	(0.8)
		$	0	$	(0.5)	$	0	$	(0.5)		$	0	$	(0.8)	$	0	$	(0.8)

Below is a roll-forward of assets and liabilities measured at fair value using Level 3 inputs for the ~~nine~~three months ended ~~November 27, 2020:~~May 28, 2021:

Roll-Forward of Fair Value Using Level 3 Inputs

Auction Rate ~~Securities~~Security

Balance as of February ~~28, 2020~~26, 2021

~~2.1~~2.6

Unrealized gain on ~~investments~~investment

~~0.3~~0.2

Balance as of ~~November 27, 2020~~May 28, 2021

~~2.4~~2.8

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

7.INVENTORIES


Inventories	Inventories	November 27, 2020		February 28, 2020		Inventories	May 28, 2021		February 26, 2021
Raw materials and work-in-process	Raw materials and work-in-process	$	130.8	$	122.0	Raw materials and work-in-process	$	137.1	$	126.0
Finished goods	Finished goods	123.3		112.8		Finished goods	113.2		86.4
		254.1		234.8			250.3		212.4
Revaluation to LIFO	Revaluation to LIFO	19.1		19.8		Revaluation to LIFO	22.7		18.9
		$	235.0	$	215.0		$	227.6	$	193.5

The portion of inventories determined by the LIFO method was ~~$106.5~~$96.5 and ~~$93.8~~$89.1 as of ~~November 27, 2020~~May 28, 2021 and February ~~28, 2020,~~26, 2021, respectively.

8.~~GOODWILL~~

~~A summary of the changes in goodwill balances during the nine months ended November 27, 2020, by reportable segment, are as follows:~~

Goodwill Americas EMEA Other Total
Goodwill $ 206.1 $ 283.5 $ 47.9 $ 537.5
Accumulated impairment losses (1.7) (265.0) (37.2) (303.9)
Balance as of February 28, 2020 204.4 18.5 10.7 233.6
Impairment charge (1) 0 (17.6) 0 (17.6)
Currency translation adjustments 0.2 (0.9) 0 (0.7)
Goodwill 206.3 282.6 47.9 536.8
Accumulated impairment losses (1.7) (282.6) (37.2) (321.5)
Balance as of November 27, 2020 $ 204.6 $ 0 $ 10.7 $ 215.3

~~_______________________________________~~

~~(1)In Q1 2021, we recorded a goodwill impairment charge in the EMEA segment related to the Orangebox U.K. reporting unit.~~

We evaluate goodwill for impairment annually in Q4, or earlier if conditions indicate it is necessary. In Q1 2021, we determined that a triggering event occurred which resulted in an interim impairment evaluation of goodwill for each of our reporting units. During Q1 2021, the market price of our Class A Common Stock declined significantly in connection with overall stock market trends related to the global economic impact of the COVID-19 pandemic. The reduction in revenue in Q1 2021 and changes to our forecasted revenue growth rates and expected operating margins related to the economic disruption of the COVID-19 pandemic were also factors that led to the completion of our interim impairment analysis.

For goodwill, we compare the fair value of each reporting unit to its carrying value. If the fair value of the reporting unit exceeds the carrying value, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, the difference is recorded as an impairment loss. We estimate the fair value of our reporting units using the income approach, which calculates the fair value of each reporting unit based on the present value of its estimated future cash flows. Cash flow projections are based on management's estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. For the evaluation that we conducted in Q1 2021, such conditions included the deterioration of industry and market conditions driven by the COVID-19 pandemic. The discount rates used are based on the weighted-average cost of capital adjusted for the relevant risk associated with business-specific characteristics and the uncertainty related to the reporting units' ability to execute on the projected cash flows. In certain circumstances, we corroborate the results determined using the income approach with a market-based approach that uses observable comparable company information to support the appropriateness of the fair value estimates.

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~~STEELCASE INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)~~

As a result of our goodwill impairment testing, we determined that the carrying value of the Orangebox U.K. reporting unit (included in the EMEA segment) exceeded its fair value, resulting in a $17.6 goodwill impairment charge in Q1 2021. Following the charge, the reporting unit had no remaining goodwill. During Q1 2021, we also tested the recoverability of the Orangebox U.K. long-lived assets (other than goodwill) and concluded that those assets were not impaired.

For each of our other reporting units, we determined that the fair value of the reporting unit substantially exceeded its carrying value, and no goodwill impairment existed. We also determined that no impairment existed related to the long-lived asset groups for any of our other reporting units.

9.~~SHORT-TERM BORROWINGS~~

Our $250.0 committed unsecured revolving syndicated credit facility expires in 2025. At our option, and subject to certain conditions, we may increase the aggregate commitment under the facility by up to $125.0 by obtaining at least one commitment from one or more lenders. During Q1 2021, we borrowed $250.0 under the facility and repaid $5.0. During Q2 2021, we repaid the remaining balance of $245.0 under the facility, and there were no borrowings outstanding under the facility as of November 27, 2020.

~~The facility does not include any restrictions on cash dividend payments or share repurchases. As of November 27, 2020, we were in compliance with all covenants under the facility.~~

~~10.INCOME TAXES~~

In Q1 2021, the U.S. government enacted tax legislation to provide economic stimulus and support to businesses during the COVID-19 pandemic, referred to as the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act"). In connection with our analysis of the impact of the CARES Act, we recorded a net tax benefit of $8.7 during the ~~nine months ended November 27, 2020, driven primarily by provisions~~ ~~within the CARES Act which enable companies to carry back tax losses to years prior to the enactment of the Tax Cuts and Jobs Act when the federal statutory income tax rate was 35%.~~

We have historically calculated the provision for income tax expense (benefit) during interim periods by applying an estimate of the annualized effective tax rate for the full fiscal year to the pre-tax income (loss) for the year-to-date period. In Q1 2021, we utilized the year-to-date actual effective tax rate to calculate our income tax expense (benefit), as we determined that it was the most reliable estimate of the annual effective tax rate. In Q2 2021 and Q3 2021, as a result of improved pre-tax income, we applied the estimated annualized effective tax rate for the fiscal year to pre-tax income for the year-to-date period to calculate our income tax expense.

~~11.~~SHARE-BASED COMPENSATION

Performance Units

~~During the nine months ended November 27, 2020, we~~We have issued ~~two sets of~~ performance units (“PSUs”) to certain ~~employees. The first set, consisting of 303,973 PSUs, will be earned at the end of 2021 (the “2021 Short-Term PSUs”), and the second set, consisting of 529,500 PSUs, will be~~employees which are earned over a three-year performance period ~~of 2021 through 2023 (the “2021 Long-Term PSUs”). The 2021 Short-Term PSUs will be earned~~ based on our Compensation Committee’s qualitative assessment of management’s performance in 2021 in a number of specified areas (collectively, the “2021 Performance Measures”). The 2021 Long-Term PSUs will be earned based on achievement of certain performance conditions ~~and~~established annually by the Compensation Committee within the first three months of the applicable fiscal year. The PSUs are then modified based on achievement of certain total shareholder return results relative to a comparison group of ~~companies. The~~companies, which is a market condition. When the performance conditions for a fiscal year are established, or if the performance conditions involve a qualitative assessment and such assessment has been made, one-third of the PSUs issued are considered granted. Therefore, each of the three fiscal years within the performance period is considered an individual tranche of the award (referred to as "Tranche 1," "Tranche 2" and "Tranche 3," respectively).

As of May 28, 2021, ~~Long-Term~~the following PSUs ~~consist~~have been issued and remained outstanding:

•448,300 PSUs to be earned over a three-year performance period of 2022 through 2024 (the "2022 PSUs"),

•529,500 PSUs to be earned over a three-year performance period of 2021 through 2023 (the "2021 PSUs") and

•296,600 PSUs to be earned over a three-year performance period of 2020 through 2022 (the "2020 PSUs").

In Q1 2022, the performance conditions were established for Tranche 1 of the 2022 PSUs, Tranche 2 of the 2021 ~~Performance Measures~~PSUs and Tranche 3 of the 2020 PSUs. Accordingly, one-third of each of these PSUs were considered granted in Q1 2022.

In Q1 2021, the performance conditions were established for ~~2022~~Tranche 1 of the 2021 PSUs and ~~2023~~Tranche 2 of the 2020 PSUs. These performance conditions involved a qualitative assessment which ~~will be established~~was made by the Compensation Committee in ~~future periods. Due to the qualitative assessment,~~Q4 2021. Accordingly, one-third of each of these ~~awards are not~~PSUs were considered granted ~~under GAAP. When~~in Q4 2021.

In Q1 2020, the ~~Compensation Committee determines whether or not, and to what extent,~~performance conditions were established for Tranche 1 of the ~~2021 Performance Measures have been met, the 2021 Short-Term PSUs and~~2020 PSUs. Accordingly, one-third of the ~~2021 Long-Term~~2020 PSUs ~~will be~~were considered ~~granted.~~ granted in Q1 2020.

Once granted, the ~~expense for these awards will be determined based on the target achieved~~PSUs are expensed and ~~the fair value of the market condition on the grant date. The expense will be~~ recorded in Additional paid-in capital on the Condensed Consolidated Balance Sheets over the remaining performance ~~period, if any.~~period.

We used the Monte Carlo simulation model to calculate the fair value of the market conditions on the respective grant dates, which resulted in a fair value of $6.1, $3.7 and $1.6 for the PSUs with market conditions granted in 2022, 2021 and 2020, respectively. The Monte Carlo simulation was computed using the following assumptions:

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)


	FY22 Award		FY21 Award				FY20 Award
	Tranche 1		Tranche 2		Tranche 1		Tranche 3		Tranche 2		Tranche 1
Risk-free interest rate (1)	0.3	%	0.2	%	0.2	%	0.1	%	0.1	%	2.3	%
Expected term	3 years		2 years		2 years		1 year		1 year		3 years
Estimated volatility (2)	53.5	%	61.3	%	58.1	%	56.1	%	74.1	%	32.5	%

During the nine months ended November 22, 2019, we issued 296,600 PSUs to certain employees which will be earned over a three-year performance period of 2020 through 2022 (the “2020 Long-Term PSUs”). The 2020 Long-Term PSUs will be earned based on achievement of certain performance conditions and then modified based on achievement of certain total shareholder return results relative to a comparison group of companies. The performance conditions for the first year of the performance period were established in Q1 2020, and accordingly, 98,867 of the 2020 Long-Term PSUs were considered granted in Q1 2020. The 2021 Performance Measures have been established as the performance conditions for the second year of the performance period of the 2020 Long-Term PSUs, and accordingly, no additional portion of such awards have been considered granted. When the Compensation Committee determines whether or not, and to what extent, the 2021 Performance Measures have been met, an additional one-third of these awards will be considered granted. Once granted, the expense for these awards will be determined based(1)Based on the ~~target achieved and the fair value of the market condition~~U.S. Government bond benchmark on the grant date. ~~The expense will be recorded in~~

(2)~~Additional paid-in capital~~ onRepresents the ~~Condensed Consolidated Balance Sheets over~~historical price volatility of our Company’s Class A Common Stock for the ~~remaining performance~~three-year period. ~~The performance conditions for 2022 for these awards will be established by the Compensation Committee in future periods.~~

The total PSU expense and associated tax benefit for all outstanding awards for the three ~~and nine~~ months ended ~~November 27,~~May 28, 2021 and May 29, 2020 ~~and November 22, 2019~~ are as follows:


		Three Months Ended				Nine Months Ended				Three Months Ended
Performance Units	Performance Units	November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			Performance Units	May 28, 2021		May 29, 2020
Expense	Expense	$	0.1	$	0.3	$	0.4	$	2.0				Expense	$	5.2	$	0.2
Tax benefit	Tax benefit	0		0		0.1		0.5					Tax benefit	1.3		0.1

As of ~~November 27, 2020,~~May 28, 2021, there was ~~$0.2~~$1.3 of remaining unrecognized compensation ~~cost~~expense related to granted nonvested PSUs, which is expected to be recognized over a remaining weighted-average period of ~~1.0~~1.9 years.

~~There were no~~The PSU ~~grants, vestings or forfeitures~~activity for the ~~nine~~three months ended ~~November 27, 2020.~~May 28, 2021 is as follows:


Maximum Number of Shares That May Be Issued Under Nonvested Units	Total	Weighted-Average Grant Date Fair Value per Unit
Nonvested as of February 26, 2021	898,156	$	14.06
Granted	1,019,517	14.38

Nonvested as of May 28, 2021	1,917,673	$	14.23

Restricted Stock Units

During the ~~nine~~three months ended ~~November 27, 2020,~~May 28, 2021, we awarded ~~1,371,077~~837,013 restricted stock units ("RSUs") to certain employees. RSUs have restrictions on transfer which lapse three years after the date of grant, at which time the RSUs will be issued as unrestricted shares of Class A Common Stock. RSUs are expensed and recorded in Additional paid-in capital on the Condensed Consolidated Balance Sheets over the requisite service period based on the value of the shares on the date of grant.

The total RSU expense and associated tax benefit for all outstanding awards for the three ~~and nine~~ months ended ~~November 27,~~May 28, 2021 and May 29, 2020 ~~and November 22, 2019~~ are as follows:


		Three Months Ended				Nine Months Ended				Three Months Ended
Restricted Stock Units	Restricted Stock Units	November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			Restricted Stock Units	May 28, 2021		May 29, 2020
Expense	Expense	$	1.9	$	1.8	$	10.9	$	11.7				Expense	$	7.7	$	7.6
Tax benefit	Tax benefit	0.5		0.5		2.8		3.1					Tax benefit	1.9		2.3

As of ~~November 27, 2020,~~May 28, 2021, there was ~~$8.1~~$10.8 of remaining unrecognized compensation ~~cost~~expense related to nonvested RSUs, which is expected to be recognized over a weighted-average period of ~~2.0~~2.1 years.

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The RSU activity for the ~~nine~~three months ended ~~November 27, 2020~~May 28, 2021 is as follows:


Nonvested Units	Nonvested Units	Total	Weighted-Average Grant Date Fair Value per Unit		Nonvested Units	Total	Weighted-Average Grant Date Fair Value per Unit
Nonvested as of February 28, 2020		1,761,124	$	15.28
Nonvested as of February 26, 2021					Nonvested as of February 26, 2021	2,285,965	$	12.11
Granted	Granted	1,371,077	9.49		Granted	837,013	14.45
Vested		(149,625)	15.12

Forfeited	Forfeited	(42,668)	14.34		Forfeited	(12,856)	13.38
Nonvested as of November 27, 2020		2,939,908	$	12.60
Nonvested as of May 28, 2021					Nonvested as of May 28, 2021	3,110,122	$	12.73

~~12.~~9. LEASES

We have operating leases for corporate offices, sales offices, showrooms, manufacturing facilities, vehicles and equipment that expire at various dates through 2031. Certain lease agreements include contingent rental payments based on per unit usage over contractual levels (e.g., miles driven or machine hours used) and others include rental payments adjusted periodically for inflationary indexes. Additionally, some leases include options to renew or terminate the leases which can be exercised at our discretion. The lease terms utilized in determining right-of-use assets and lease liabilities include the noncancellable portion of the underlying leases along with any reasonably certain lease periods associated with available renewal periods. Our leases do not contain any residual value guarantees or material restrictive covenants. As most of our leases do not provide an implicit discount rate, we use an estimated incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. The estimated incremental borrowing rate represents the estimated rate of interest we would have had to pay to borrow on a collateralized basis an amount equal to the lease payments for a similar period of time.

As a result of the COVID-19 pandemic, the FASB staff issued a question and answer document (the "Staff Q&A") on the application of lease accounting guidance related to lease concessions provided as a result of the pandemic. The Staff Q&A provides interpretive guidance allowing companies the option to account for lease concessions related to the pandemic consistent with how those concessions would be accounted for under ASU 2016-02, ~~Leases (Topic 842)~~, as though enforceable rights and obligations for those concessions existed at the beginning of the contract (regardless of whether those enforceable rights and obligations for the concessions explicitly exist in the contract). This interpretive guidance was issued in order to reduce the costs and complexities of applying lease modification accounting under Topic 842 to leases impacted by the effects of the pandemic. We have elected to apply the interpretive guidance provided in the Staff Q&A to rent deferrals and abatements received related to the pandemic. Accordingly, we have not remeasured the related right-of-use asset or lease liability for the affected leases. The lease concessions were not material for the nine months ended November 27, 2020.

The components of lease expense are as follows:


		Three Months Ended				Nine Months Ended				Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019		May 28, 2021	May 29, 2020
Operating lease cost	Operating lease cost	$	12.8	$	13.0	$	38.8	$	37.6			Operating lease cost	$	13.1	$	13.1
Sublease rental income	Sublease rental income	(0.7)		(0.4)		(1.6)		(0.8)				Sublease rental income	(0.4)		(0.3)
		$	12.1	$	12.6	$	37.2	$	36.8				$	12.7	$	12.8

Supplemental cash flow and other information related to leases are as follows:


		Three Months Ended				Nine Months Ended					Three Months Ended
		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019			May 28, 2021			May 29, 2020
Cash flow information:	Cash flow information:									Cash flow information:
Operating cash flows used for operating leases	Operating cash flows used for operating leases	$	12.6	$	9.5	$	37.3	$	32.9	Operating cash flows used for operating leases	$	13.4		$	12.6
Leased assets obtained in exchange for new operating lease obligations	Leased assets obtained in exchange for new operating lease obligations	$	0.7	$	25.6	$	2.6	$	83.8	Leased assets obtained in exchange for new operating lease obligations	$	1.6		$	0.5
Other information:										Other information:
Weighted-average remaining term										Weighted-average remaining term	6.5 years			7.0 years
Weighted-average discount rate										Weighted-average discount rate	3.8		%	4.0		%

The following table summarizes the future minimum lease payments as of May 28, 2021:


Fiscal year ending in February	Amount (1)
2022	$	39.0
2023	45.5
2024	40.1
2025	37.8
2026	30.1
Thereafter	72.4
Total lease payments	$	264.9
Less interest	30.4
Present value of lease liabilities	$	234.5

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

November 27,
2020 November 22,
2019
Other information:
Weighted-average remaining term 6.7 years 7.4 years
Weighted-average discount rate 4.0 % 4.1 %

~~The following table summarizes the future minimum lease payments as of November 27, 2020:~~

Fiscal year ending in February Amount (1)
2021 $ 12.6
2022 48.6
2023 42.0
2024 36.6
2025 34.2
Thereafter 92.6
Total lease payments 266.6
Less interest 33.3
Present value of lease liabilities $ 233.3

(1)Lease payments include options to extend lease terms that are reasonably certain of being exercised. The payments exclude legally binding minimum lease payments for leases signed but not yet commenced.

~~13.~~10. REPORTABLE SEGMENTS

Our reportable segments consist of the Americas segment, the EMEA segment and the Other category. Unallocated corporate ~~costs~~expenses are reported as Corporate.

The Americas segment serves customers in the U.S., Canada, the Caribbean Islands and Latin America with a comprehensive portfolio of ~~integrated architecture,~~ furniture, architectural and technology products marketed to corporate, government, healthcare, education and retail customers through the Steelcase, Coalesse, Smith System, AMQ ~~Turnstone~~ and Orangebox brands.

The EMEA segment serves customers in Europe, the Middle East and Africa primarily under the Steelcase, Orangebox and Coalesse brands, with ~~an emphasis on freestanding~~a comprehensive portfolio of furniture, ~~systems, storage~~architectural and ~~seating solutions.~~technology products.

The Other category includes Asia Pacific and Designtex. Asia Pacific serves customers in ~~Asia~~Australia, China, India, Japan, Korea and ~~Australia~~other countries in Southeast Asia primarily under the Steelcase brand with ~~an emphasis on freestanding~~a comprehensive portfolio of furniture, ~~systems, seating~~architectural and ~~storage solutions.~~technology products. Designtex primarily sells textiles, wall coverings and surface imaging solutions specified by architects and designers directly to end-use customers through a direct sales force primarily in North America. ~~In 2020, the Other category also included PolyVision which was sold during Q4 2020.~~

We primarily review and evaluate revenue and operating income by segment in both our internal review processes and for our external financial reporting. We also allocate resources primarily based on revenue and operating income. Total assets by segment include manufacturing and other assets associated with each segment.

Corporate costs include unallocated portions of shared service functions such as information technology, corporate facilities, finance, human resources, research, legal and customer aviation, plus deferred compensation expense and income or losses associated with COLI. Corporate assets consist primarily of unallocated cash and cash equivalents, COLI, ~~balances,~~ fixed assets and right-of-use assets related to operating leases.

Revenue and operating loss for the three months ended May 28, 2021 and May 29, 2020 and total assets as of May 28, 2021 and February 26, 2021 by segment are presented below:


	Three Months Ended
Reportable Segment Statement of Operations Data	May 28, 2021		May 29, 2020
Revenue
Americas	$	376.3	$	333.9
EMEA	123.6		99.5
Other	56.7		49.4
	$	556.6	$	482.8
Operating loss
Americas	$	(15.0)	$	(23.5)
EMEA	(5.7)		(24.6)
Other	(5.3)		(1.6)
Corporate	(5.8)		(2.6)
	$	(31.8)	$	(52.3)

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STEELCASE INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Revenue and operating income (loss) for the three and nine months ended November 27, 2020 and November 22, 2019 and total assets as of November 27, 2020 and February 28, 2020 by segment are presented below:

Three Months Ended Nine Months Ended
Reportable Segment Statement of Operations Data November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Revenue
Americas $ 416.4 $ 690.9 $ 1,381.5 $ 2,006.7
EMEA 143.3 168.4 368.7 483.9
Other 57.8 95.9 168.9 286.9
$ 617.5 $ 955.2 $ 1,919.1 $ 2,777.5
Operating income (loss)
Americas $ 13.8 $ 74.7 $ 84.9 $ 197.4
EMEA (3.7) 6.3 (31.8) 1.6
Other (2.2) 3.3 (2.7) 14.5
Corporate (7.9) (9.2) (14.1) (25.5)
$ 0 $ 75.1 $ 36.3 $ 188.0

Reportable Segment Balance Sheet Data November 27,
2020 February 28,
2020
Total assets
Americas $ 1,038.8 $ 1,067.3
EMEA 413.9 454.5
Other 214.1 225.6
Corporate 718.5 818.0
$ 2,385.3 $ 2,565.4

~~14. RESTRUCTURING ACTIVITIES~~

In Q2 2021, our Board of Directors approved a series of restructuring actions in response to continued order declines in the Americas compared to the prior year and continued economic uncertainty related to the COVID-19 pandemic. The restructuring actions included early retirements and voluntary and involuntary terminations of approximately 300 salaried employees and early retirements of approximately 160 hourly employees. We incurred $11.4 and $27.0 in restructuring costs in the Americas segment in connection with these actions during the three and nine months ended November 27, 2020, respectively, consisting of cash severance payments and payment of other separation-related benefits. We expect all of the actions to be completed by the end of 2021.

~~The following table details the changes in the restructuring reserve balance as of November 27, 2020:~~


	~~Workforce reductions~~
~~Balance as of February 28, 2020~~	$	0
~~Restructuring costs~~	~~27.0~~
~~Payments~~	~~(25.5)~~
~~Balance as of November 27, 2020~~	$	~~1.5~~


Reportable Segment Balance Sheet Data	May 28, 2021		February 26, 2021
Total assets
Americas	$	1,031.0	$	1,015.3
EMEA	413.1		414.4
Other	216.9		211.3
Corporate	628.6		713.0
	$	2,289.6	$	2,354.0

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Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations:

This management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended February ~~28, 2020.~~26, 2021. Reference to a year relates to the fiscal year, ended in February of the year indicated, rather than the calendar year, unless indicated by a specific date. Additionally, Q1, Q2, Q3 and Q4 reference the first, second, third and fourth quarter, respectively, of the fiscal year indicated. All amounts are in millions, except share and per share data, data presented as a percentage or as otherwise indicated.

Non-GAAP Financial Measures

This item contains certain non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the condensed consolidated statements of ~~income,~~operations, balance sheets or statements of cash flows of the company. Pursuant to the requirements of Regulation G, we have provided a reconciliation below of the non-GAAP financial measures to the most directly comparable GAAP financial measure.

The non-GAAP financial measures used are (1) organic revenue ~~decline,~~growth, which represents the change in revenue excluding the impacts of acquisitions and divestitures and estimated currency translation effects, and (2) adjusted operating ~~income (loss),~~loss, which represents operating ~~income (loss)~~loss excluding goodwill impairment ~~charges and restructuring costs.~~charges. These measures are presented because management uses this information to monitor and evaluate financial results and trends. Therefore, management believes this information is also useful for investors.

Financial Summary

Our reportable segments consist of the Americas segment, the EMEA segment and the Other category. Unallocated corporate ~~costs~~expenses are reported as Corporate.

Results of Operations


		Three Months Ended								Nine Months Ended								Three Months Ended
Statement of Operations Data	Statement of Operations Data	November 27, 2020				November 22, 2019				November 27, 2020				November 22, 2019					Statement of Operations Data	May 28, 2021				May 29, 2020
Revenue	Revenue	$	617.5	100.0	%	$	955.2	100.0	%	$	1,919.1	100.0	%	$	2,777.5	100.0	%								Revenue		$	556.6		100.0	%		$	482.8	100.0	%
Cost of sales	Cost of sales	437.3		70.9		639.1		66.9		1,339.7		69.8		1,869.5		67.3									Cost of sales		401.9			72.2			360.1		74.6
Restructuring costs		2.3		0.3		—		—		9.2		0.5		—		—

Gross profit	Gross profit	177.9		28.8		316.1		33.1		570.2		29.7		908.0		32.7									Gross profit		154.7			27.8			122.7		25.4
Operating expenses	Operating expenses	168.8		27.3		241.0		25.2		498.5		26.0		720.0		25.9									Operating expenses		186.5			33.5			157.4		32.6
Goodwill impairment charge	Goodwill impairment charge	—		—		—		—		17.6		0.9		—		—									Goodwill impairment charge		—			—			17.6		3.6
Restructuring costs		9.1		1.5		—		—		17.8		0.9		—		—
Operating income		—		—		75.1		7.9		36.3		1.9		188.0		6.8

Operating loss																					Operating loss	(31.8)				(5.7)			(52.3)			(10.8)
Interest expense	Interest expense	(6.6)		(1.1)		(6.7)		(0.7)		(20.7)		(1.2)		(20.1)		(0.7)									Interest expense		(6.4)			(1.1)			(7.3)		(1.6)
Investment income	Investment income	0.2		—		1.3		0.1		1.2		0.1		3.8		0.1									Investment income		0.2			—			0.8		0.2
Other income, net		2.2		0.4		4.1		0.4		7.0		0.4		8.3		0.3
Income (loss) before income tax expense (benefit)		(4.2)		(0.7)		73.8		7.7		23.8		1.2		180.0		6.5
Income tax expense (benefit)		(6.3)		(1.0)		18.9		2.0		4.3		0.2		46.8		1.7
Net income		$	2.1	0.3	%	$	54.9	5.7	%	$	19.5	1.0	%	$	133.2	4.8	%
Earnings per share:
Other income (expense), net																					Other income (expense), net	(0.8)				(0.2)			4.0			0.8
Loss before income tax benefit																					Loss before income tax benefit	(38.8)				(7.0)			(54.8)			(11.4)
Income tax benefit																					Income tax benefit	(10.7)				(2.0)			(16.7)			(3.5)
Net loss																					Net loss	$	(28.1)			(5.0)		%	$	(38.1)		(7.9)		%
Earnings (loss) per share:																					Earnings (loss) per share:
Basic	Basic	$	0.02			$	0.46			$	0.17			$	1.11										Basic		$	(0.24)					$	(0.33)
Diluted	Diluted	$	0.02			$	0.46			$	0.17			$	1.11										Diluted		$	(0.24)					$	(0.33)

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Q3 2021 Organic Revenue Decline Americas EMEA Other Consolidated
Q3 2020 revenue $ 690.9 $ 168.4 $ 95.9 $ 955.2
Divestiture — — (14.9) (14.9)
Currency translation effects* 0.2 10.2 0.6 11.0
Q3 2020 revenue, adjusted 691.1 178.6 81.6 951.3
Q3 2021 revenue 416.4 143.3 57.8 617.5
Organic decline $ $ (274.7) $ (35.3) $ (23.8) $ (333.8)
Organic decline % (40) % (20) % (29) % (35) %
* Currency translation effects represent the estimated net effect of translating Q3 2020 foreign currency revenues using the average exchange rates during Q3 2021.


Q1 2022 Organic Revenue Growth	Americas			EMEA			Other			Consolidated
Q1 2021 revenue	$	333.9		$	99.5		$	49.4		$	482.8
Dealer acquisition	12.8			—			—			12.8

Currency translation effects*	1.9			10.1			1.7			13.7
Q1 2021 revenue, adjusted	348.6			109.6			51.1			509.3
Q1 2022 revenue	376.3			123.6			56.7			556.6


Organic growth $	$	27.7		$	14.0		$	5.6		$	47.3
Organic growth %	8		%	13		%	11		%	9		%

* Currency translation effects represent the estimated net effect of translating Q1 2021 foreign currency revenues using the average exchange rates during Q1 2022.

Year-to-date 2021 Organic Revenue Decline Americas EMEA Other Consolidated
Year-to-date 2020 revenue $ 2,006.7 $ 483.9 $ 286.9 $ 2,777.5
Divestiture — — (48.2) (48.2)
Currency translation effects* (2.0) 8.1 (1.8) 4.3
Year-to-date 2020 revenue, adjusted 2,004.7 492.0 236.9 2,733.6
Year-to-date 2021 revenue 1,381.5 368.7 168.9 1,919.1
Organic decline $ (623.2) (123.3) (68.0) (814.5)
Organic decline % (31) % (25) % (29) % (30) %
* Currency translation effects represent the estimated net effect of translating year-to-date 2020 foreign currency revenues using the average exchange rates during year-to-date 2021.

Reconciliation of Operating Income to Adjusted Operating Income Three Months Ended Nine Months Ended
November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Operating income $ — — % $ 75.1 7.9 % $ 36.3 1.9 % $ 188.0 6.8 %
Add: goodwill impairment charge — — — — 17.6 0.9 — —
Add: restructuring costs 11.4 1.8 — — 27.0 1.4 — —
Adjusted operating income $ 11.4 1.8 % $ 75.1 7.9 % $ 80.9 4.2 % $ 188.0 6.8 %


Reconciliation of Operating Loss to Adjusted Operating Loss	Three Months Ended
	May 28, 2021				May 29, 2020
Operating loss	$	(31.8)	(5.7)	%	$	(52.3)	(10.8)	%
Add: goodwill impairment charge	—		—		17.6		3.6

Adjusted operating loss	$	(31.8)	(5.7)	%	$	(34.7)	(7.2)	%

Overview

~~During 2021, the COVID-19 pandemic, actions taken by various governments and third parties to combat the spread of COVID-19 and the related global economic uncertainty resulted~~Our revenue grew 15% in significant declines in our revenue and orders compared to the prior year. We took a number of actions to conserve capital and reduce our cost structure in response to such events, including significantly reducing salaries in the first half of the year and substantially reducing discretionary spending. By the end of Q2 2021, we restored most of our global salaried workforce to full pay, and in Q2 and Q3 2021, we implemented workforce reductions in the Americas which lowered our annualized costs by approximately $40. We recorded $11.4 and $27.0 of restructuring costs in Q3 2021 and year-to-date 2021, respectively, related to the workforce reductions.

In Q3 2021, our revenue declined 35% compared to the prior year, and we had break-even operating income. The revenue decline was driven by the impacts of the COVID-19 pandemic, as well as a delay of approximately $60 of revenue to Q4 2021 due to a temporary global operations shutdown we implemented to protect our systems during a cyberattack we experienced during the quarter. The impact of the decline in revenue was partially mitigated by savings from cost reduction actions and lower variable compensation expense.

~~Table of Contents~~

~~Q3 2021 Compared to Q3 2020~~

We recorded net income of $2.1 and diluted earnings per share of $0.02 in Q3 2021 compared to net income of $54.9 and diluted earnings per share of $0.46 in the prior year. The Q3 2021 results included restructuring costs of $11.4 in the Americas segment which had the effect of decreasing diluted earnings per share by $0.06, net of related tax benefits. Break-even operating income in Q3 2021 represented a $75.1 decline from the prior year. The decrease was driven by the impact of lower revenue and restructuring costs, partially offset by cost reduction actions implemented across all segments and lower variable compensation expense. Excluding the impact of the restructuring costs, adjusted operating income of $11.4 in Q3 2021 represented a decrease of $63.7 compared to the prior year.

~~Revenue of $617.5 in Q3 2021 represented a decrease of $337.7 or 35%~~Q1 2022 compared to the prior year. The ~~decline~~growth was broad-based, ~~across~~as all segments ~~driven~~were impacted in the prior year by ~~reduced demand due to underlying economic uncertainty related~~government mandates in response to the COVID-19 pandemic which significantly limited our ability to manufacture and ~~approximately $60~~fulfill orders. Our revenue continues to be negatively impacted by the effects of ~~shipments were delayed~~the COVID-19 pandemic, but our orders grew 11% in Q1 2022 compared to the prior year. Our average weekly order levels strengthened during the quarter, and orders grew 25% compared to Q4 ~~2021~~2021. We also saw significant increases in customer visits, product mock-ups and requests for proposals during the quarter as companies plan for their employees to return to the office, which we believe will drive increased demand for our products in the future.

Cost of sales as a ~~result~~percentage of revenue decreased by 240 basis points in Q1 2022 compared to the ~~temporary~~prior year, driven by lower overhead costs in the current year and inefficiencies related to labor cost utilization in the prior year while our operations ~~shutdown~~were impacted by the pandemic-related restrictions. Cost of sales in Q3Q1 2022 included approximately $7 of inflation, net of pricing benefits, compared to the prior year driven by higher costs of steel, other commodities and logistics. We expect these inflationary pressures to continue to impact our cost of sales for the next few quarters but we expect to offset more of these costs later in 2022 as recent price increases are more fully implemented.

At the end of Q1 2022, our backlog of customer orders was approximately 20% lower than the prior year, which was impacted by the pandemic-related restrictions on manufacturing and distribution operations, but approximately 39% higher than at the end of Q4 2021. We expect to ship most of our backlog during Q2 2022.

Q1 2022 Compared to Q1 2021

We recorded a net loss of $28.1 and a loss per share of $0.24 in Q1 2022 compared to a net loss of $38.1 and a loss per share of $0.33 in the prior year. The prior year results included a goodwill impairment charge in the EMEA segment which increased the net loss by $17.6 and loss per share by $0.15. The operating loss of $31.8 in Q1 2022 represented an improvement of $20.5 from the prior year, which included the impairment charge. The remaining improvement was driven by higher revenue and lower cost of sales as a percentage of revenue, partially offset by higher operating expenses.

Revenue ~~declined~~of $556.6 in Q1 2022 represented an increase of $73.8 or 15% compared to the prior year. The increase was broad-based as all segments in the prior year were impacted by ~~40%~~government mandates in response to the COVID-19 pandemic which significantly limited our ability to manufacture and fulfill orders. Revenue increased by 13% in the Americas, ~~15%~~24% in EMEA and ~~40%~~15% in the Other category compared to the prior year. After adjusting for a ~~$14.9~~$12.8 impact from ~~the divestiture of PolyVision in Q4 2020~~a dealer acquisition and ~~$11.0~~$13.7 of currency translation effects, the organic revenue ~~decline~~growth was ~~$333.8~~$47.3 or ~~35%~~9% compared to the prior year. The organic revenue ~~decline~~growth was ~~40%~~8% in the Americas, ~~20%~~13% in EMEA and ~~29%~~11% in the Other category compared to the prior year.

Cost of sales as a percentage of revenue ~~increased~~decreased by ~~400~~240 basis points to ~~70.9%~~72.2% of revenue in ~~Q3 2021~~Q1 2022 compared to ~~Q3 2020.~~Q1 2021. The ~~increase~~improvement was driven by the benefit of the higher revenue, approximately $5 of lower

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overhead costs and approximately $4 of lower ~~revenue, as well as approximately $12 of higher~~labor costs due to inefficiencies in the prior year related to ~~direct~~ labor ~~and logistics, of which approximately $4 was related to the temporary operations shutdown,~~cost utilization, partially offset by approximately ~~$16~~$7 of ~~lower overhead costs,~~inflation, net of ~~which approximately $7 was attributable to lower wage and benefit expenses as a result of workforce reductions, and $10.8 of lower variable compensation expense.~~pricing benefits. Cost of sales as a percentage of revenue ~~increased~~decreased by 320 basis points in the Americas ~~590~~and 330 basis points in EMEA, and ~~200~~increased by 460 basis points in the Other category.

Operating expenses of ~~$168.8~~$186.5 in ~~Q3 2021~~Q1 2022 represented ~~a decrease~~an increase of ~~$72.2~~$29.1 compared to the prior ~~year. The decrease was driven by an~~year, which included approximately ~~$29 reduction in discretionary spending, $25.5 of lower variable compensation expense and approximately $12~~$20 of lower wage and benefit expenses as a result of ~~workforce reductions.~~

~~We recorded restructuring costs~~temporary hour and pay reductions and a $2.6 gain on the sale of $11.4 in the Americas segment in Q3 2021 related to workforce reduction actions taken as a result of reduced demand due to the COVID-19 pandemic. See Note 14 to the condensed consolidated financial statements for further information.

~~We recorded a tax~~land. The current year included an approximately $10 benefit of $6.3 in Q3 2021 compared to tax expense of $18.9 in the prior year. The Q3 2021 amount was primarily driven by benefits available under the U.S. Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"). See Note 10 to the condensed consolidated financial statements for further details.

~~Year-to-Date 2021 Compared to Year-to-Date 2020~~

We recorded year-to-date 2021 net income of $19.5 and diluted earnings per share of $0.17, compared to year-to-date 2020 net income of $133.2 and diluted earnings per share of $1.11. In year-to-date 2021, the results included: (1) a goodwill impairment charge related to the EMEA segment, which had the effect of decreasing net income by $17.6 and diluted earnings per share by $0.15, and (2) restructuring costs in the Americas segment, which had the effect of decreasing net income by $16.5 and diluted earnings per share by $0.14. Year-to-date 2021 operating income of $36.3 represented a decrease of $151.7 compared to the prior year. The decrease was due to lower revenue across all segments, restructuring costs and the goodwill impairment charge, partially offset by lower operating expenses and overhead costs. Excluding the impact of the restructuring costs and the impairment charge, adjusted operating income decreased by $107.1 compared to the prior year.

Year-to-date 2021 revenue of $1,919.1 represented a decrease of $858.4 or 31% compared to year-to-date 2020. The decline was broad-based across all segments due to the impacts of the COVID-19 pandemic. Revenue declined by 31% in the Americas, 24% in EMEA and 41% in the Other category. After adjusting for a $48.2 impact from the divestiture of PolyVision and $4.3 of currency translation effects, the organic revenue decline was $814.5 or 30% compared to the prior year. The organic revenue decline was 31% in the Americas, 25% in EMEA and 29% in the Other category.

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Cost of sales as a percentage of revenue increased by 250 basis points to 69.8% of revenue in year-to-date 2021 compared to the prior year. The increase was driven by lower revenue, as well as approximately $24 of higher costs related to direct labor and logistics, of which approximately $4 was related to the temporary operations shutdown in Q3 2021, partially offset by approximately $32 of lower overhead costs, of which approximately $15 was attributable to lower wage and benefit expenses related to workforce reductions, ~~and temporary salary reductions, pricing benefits and $20.0~~which was more than offset by $5.7 of ~~lower~~higher variable compensation ~~expense. Cost~~expense driven by the timing of ~~sales as~~when a ~~percentage~~portion of ~~revenue increased by 210 basis points~~stock compensation expense was recorded in the ~~Americas, 370 basis points in EMEA~~prior year, approximately $4 of increased discretionary spending and ~~190 basis points in the Other category.~~$2.8 from an acquisition.

~~Operating expenses~~Our Q1 2022 effective tax rate of ~~$498.5 in year-to-date 2021 represented a decrease of $221.5~~27.6% compared to the prior year. The decrease was driven by approximately $88 of reduced discretionary spending, approximately $55 of lower wage and benefit expenses related to workforce reductions and temporary salary reductions and $48.8 of lower variable compensation expense. Operating expenses also included $6.7 of gains from the sale of land and $4.2 of higher COLI income in year-to-date 2021.

~~We recorded restructuring costs of $27.0 in the Americas segment in year-to-date 2021 related to workforce reduction actions taken as~~ a ~~result of reduced demand due to the COVID-19 pandemic. See Note 14 to the condensed consolidated financial statements for further information.~~

~~Our year-to-date~~Q1 2021 effective tax rate ~~was 18.1% compared to a year-to-date 2020 effective tax rate~~ of ~~26.0%~~30.5%. The year-to-date 2021 tax rate reflected the non-deductible nature of the goodwill impairment charge recorded in Q1 2021 as well as $10.5 of benefits related to the restructuring costs and $8.7 of other net benefits primarily related to the CARES Act. See Note 10 to the condensed consolidated financial statements for further details.

Interest Expense, Investment Income and Other Income (Expense), Net


		Three Months Ended				Nine Months Ended					Three Months Ended
Interest Expense, Investment Income and Other Income, Net		November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019
Interest Expense, Investment Income and Other Income (Expense), Net										Interest Expense, Investment Income and Other Income (Expense), Net	May 28, 2021		May 29, 2020
Interest expense	Interest expense	$	(6.6)	$	(6.7)	$	(20.7)	$	(20.1)	Interest expense	$	(6.4)	$	(7.3)
Investment income	Investment income	0.2		1.3		1.2		3.8		Investment income	0.2		0.8
Other income (expense), net:	Other income (expense), net:									Other income (expense), net:
Equity in income of unconsolidated affiliates	Equity in income of unconsolidated affiliates	2.6		4.1		6.6		9.8		Equity in income of unconsolidated affiliates	1.3		1.9
Foreign exchange gains (losses)		0.1		0.1		(1.0)		0.2
Foreign exchange gain (loss)										Foreign exchange gain (loss)	(0.2)		0.1
Net periodic pension and post-retirement credit, excluding service cost	Net periodic pension and post-retirement credit, excluding service cost	—		0.2		(0.1)		0.7		Net periodic pension and post-retirement credit, excluding service cost	(0.2)		—
Miscellaneous income (expense), net	Miscellaneous income (expense), net	(0.5)		(0.3)		1.5		(2.4)		Miscellaneous income (expense), net	(1.7)		2.0
Total other income, net		2.2		4.1		7.0		8.3
Total interest expense, investment income and other income, net		$	(4.2)	$	(1.3)	$	(12.5)	$	(8.0)
Total other income (expense), net										Total other income (expense), net	(0.8)		4.0
Total interest expense, investment income and other income (expense), net										Total interest expense, investment income and other income (expense), net	$	(7.0)	$	(2.5)

~~Investment~~In Q1 2022, other income (expense), net decreased by ~~$1.1 and $2.6, respectively, in Q3 2021 and year-to-date 2021~~$4.8 compared to the prior ~~year due to lower market interest rates. Other~~year. In Q1 2021, miscellaneous income (expense), net decreased by $1.9 in Q3 2021 compared to the prior year primarily due to lower income from unconsolidated affiliates. Year-to-date 2021 other income, net decreased by $1.3 compared to the prior year primarily due to lower income from unconsolidated affiliates and foreign exchange losses, partially offset byincluded a $2.8 gain related to additional proceeds received from the partial sale of an investment in an unconsolidated affiliate in 2018. The higher interest expense in Q1 2021 was primarily due to a borrowing under our global credit facility, which was repaid during Q2 2021.

Business Segment Review

See Note 1310 to the condensed consolidated financial statements for additional information regarding our business segments.

Americas

The Americas segment serves customers in the U.S., Canada, the Caribbean Islands and Latin America with a comprehensive portfolio of ~~integrated architecture,~~ furniture, architectural and technology products marketed to corporate, government, healthcare, education and retail customers through the Steelcase, Coalesse, ~~Turnstone,~~ Smith System, AMQ and Orangebox brands.


	Three Months Ended
Statement of Operations Data — Americas	May 28, 2021				May 29, 2020
Revenue	$	376.3	100.0	%	$	333.9	100.0	%
Cost of sales	272.5		72.4		252.3		75.6

Gross profit	103.8		27.6		81.6		24.4
Operating expenses	118.8		31.6		105.1		31.4


Operating loss	$	(15.0)	(4.0)	%	$	(23.5)	(7.0)	%

The operating loss in the Americas improved by $8.5 in Q1 2022 compared to the prior year. The improvement was driven by higher revenue and lower cost of sales as a percentage of revenue, partially offset by higher operating expenses.

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Three Months Ended Nine Months Ended
Statement of Operations Data — Americas November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Revenue $ 416.4 100.0 % $ 690.9 100.0 % $ 1,381.5 100.0 % $ 2,006.7 100.0 %
Cost of sales 290.4 69.7 459.3 66.5 950.8 68.8 1,339.0 66.7
Restructuring costs 2.3 0.6 — — 9.2 0.7 — —
Gross profit 123.7 29.7 231.6 33.5 421.5 30.5 667.7 33.3
Operating expenses 100.8 24.2 156.9 22.7 318.8 23.1 470.3 23.5
Goodwill impairment charge — — — — — — — —
Restructuring costs 9.1 2.2 — — 17.8 1.3 — —
Operating income $ 13.8 3.3 % $ 74.7 10.8 % $ 84.9 6.1 % $ 197.4 9.8 %

Reconciliation of Operating Income to Adjusted Operating Income — Americas Three Months Ended Nine Months Ended
November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Operating income $ 13.8 3.3 % $ 74.7 10.8 % $ 84.9 6.1 % $ 197.4 9.8 %
Add: goodwill impairment charge — — — — — — — —
Add: restructuring costs 11.4 2.8 — — 27.0 2.0 — —
Adjusted operating income $ 25.2 6.1 % $ 74.7 10.8 % $ 111.9 8.1 % $ 197.4 9.8 %

~~Operating income~~The Americas revenue represented 67.6% of consolidated revenue in ~~the Americas declined by $60.9 in Q3 2021~~Q1 2022. Q1 2022 revenue of $376.3 represented an increase of $42.4 or 13% compared to the prior year. ~~The Q3 2021 results included $11.4~~Revenue in the prior year was impacted by government mandates in response to the COVID-19 pandemic which significantly limited our ability to manufacture and fulfill orders. After adjusting for a $12.8 impact from a dealer acquisition and $1.9 of ~~restructuring costs. The remaining decline~~currency translation effects, the organic revenue growth was ~~driven by lower revenue, partially offset by cost reductions. Excluding the impact of the restructuring costs, adjusted operating income decreased by $49.5 in Q3 2021~~$27.7 or 8% compared to the prior year. Operating income in year-to-date 2021 decreased by $112.5 compared to the prior year. The decrease was driven by the same factors as the quarter. Excluding the impact of the restructuring costs, year-to-date 2021 adjusted operating income decreased by $85.5 compared to the prior year.

The Americas revenue represented 67.4% of consolidated revenue in Q3 2021. Q3 2021 revenue of $416.4 represented a decrease of $274.5 or 40% compared to the prior year. The decrease was driven by reduced industry demand due to the ongoing uncertainty related to the COVID-19 pandemic and approximately $50 of delayed shipments as a result of the temporary operations shutdown during Q3 2021. Year-to-date 2021 revenue of $1,381.5 represented a decrease of $625.2 or 31% compared to year-to-date 2020. The decrease was driven by the same factors as the quarter.

Cost of sales as a percentage of revenue ~~increased~~decreased by 320 basis points in Q3 2021 compared to Q3 2020. The increase was driven by lower revenue, as well as approximately $11 of higher costs related to direct labor and logistics, of which approximately $3 was related to the temporary operations shutdown, partially offset by approximately $15 of lower overhead costs, of which approximately $7 was attributable to lower wage and benefit expenses related to workforce reductions and $9.8 of lower variable compensation expense. Year-to-date 2021 cost of sales as a percentage of revenue increased by 210 basis pointsQ1 2022 compared to the prior year. The ~~increase~~improvement was driven by the ~~lower~~higher revenue, ~~as well as approximately $16 of higher costs related to direct labor and logistics, partially offset by pricing benefits, approximately $27~~$3.7 of lower overhead costs (net of ~~which~~temporary hour and pay reductions in the prior year) and approximately ~~$13 was attributable~~$4 of lower labor costs due to ~~lower wage and benefit expenses~~inefficiencies in the prior year related to ~~workforce reductions and temporary salary reductions and $17.9~~labor cost utilization, partially offset by approximately $7 of ~~lower variable compensation expense.~~inflation, net of pricing benefits.

Operating expenses in ~~Q3 2021 decreased~~Q1 2022 increased by ~~$56.1~~$13.7 compared to the prior ~~year. The decrease was driven by~~year, which included approximately ~~$23 of lower discretionary spending, $19.9 of lower variable compensation expense and approximately $9~~$17 of lower wage and benefit expenses ~~related to workforce reductions. Year-to-date 2021 operating expenses decreased by $151.5 compared to~~as a result of temporary hour and pay reductions and a $2.6 gain on the ~~prior year.~~sale of land. The ~~decrease was driven by~~current year included an approximately ~~$60 of lower discretionary spending, $38.2 of lower variable compensation expense and approximately $36 of lower wage and~~$10 benefit ~~expenses~~ related to workforce reductions, ~~and temporary salary reductions. Operating expenses also included $6.7 from gains on the sale~~which was partially offset by $4.3 of ~~land in year-to-date 2021.~~

~~We recorded restructuring costs of $11.4 in Q3 2021 and $27.0 in year-to-date 2021 related to workforce reduction actions taken as a result of reduced demand~~higher variable compensation expense primarily due to the ~~COVID-19 pandemic. See Note 14 to~~timing of when a portion of stock compensation expense was recorded in the ~~condensed consolidated financial statements for further information.~~

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prior year and $2.8 from an acquisition.

EMEA

The EMEA segment serves customers in Europe, the Middle East and Africa primarily under the Steelcase, Orangebox and Coalesse brands, with ~~an emphasis on freestanding~~a comprehensive portfolio of furniture, ~~systems, seating~~architectural and ~~storage solutions.~~technology products.


		Three Months Ended								Nine Months Ended								Three Months Ended
Statement of Operations Data — EMEA	Statement of Operations Data — EMEA	November 27, 2020				November 22, 2019				November 27, 2020				November 22, 2019					Statement of Operations Data — EMEA	May 28, 2021				May 29, 2020
Revenue	Revenue	$	143.3	100.0	%	$	168.4	100.0	%	$	368.7	100.0	%	$	483.9	100.0	%								Revenue		$	123.6		100.0	%		$	99.5	100.0	%
Cost of sales	Cost of sales	107.7		75.2		116.7		69.3		276.4		75.0		345.0		71.3									Cost of sales		89.5			72.4			75.3		75.7
Restructuring costs		—		—		—		—		—		—		—		—

Gross profit	Gross profit	35.6		24.8		51.7		30.7		92.3		25.0		138.9		28.7									Gross profit		34.1			27.6			24.2		24.3
Operating expenses	Operating expenses	39.3		27.4		45.4		27.0		106.5		28.8		137.3		28.4									Operating expenses		39.8			32.2			31.2		31.3
Goodwill impairment charge	Goodwill impairment charge	—		—		—		—		17.6		4.8		—		—									Goodwill impairment charge		—			—			17.6		17.7
Restructuring costs		—		—		—		—		—		—		—		—
Operating income (loss)		$	(3.7)	(2.6)	%	$	6.3	3.7	%	$	(31.8)	(8.6)	%	$	1.6	0.3	%

Operating loss																					Operating loss	$	(5.7)			(4.6)		%	$	(24.6)		(24.7)		%

Reconciliation of Operating Income (Loss) to Adjusted Operating Income (Loss) — EMEA Three Months Ended Nine Months Ended
November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Operating income (loss) $ (3.7) (2.6) % $ 6.3 3.7 % $ (31.8) (8.6) % $ 1.6 0.3 %
Add: goodwill impairment charge — — — — 17.6 4.8 — —
Add: restructuring costs — — — — — — — —
Adjusted operating income (loss) $ (3.7) (2.6) % $ 6.3 3.7 % $ (14.2) (3.8) % $ 1.6 0.3 %


Reconciliation of Operating Loss to Adjusted Operating Loss — EMEA	Three Months Ended
	May 28, 2021				May 29, 2020
Operating loss	$	(5.7)	(4.6)	%	$	(24.6)	(24.7)	%
Add: goodwill impairment charge	—		—		17.6		17.7

Adjusted operating loss	$	(5.7)	(4.6)	%	$	(7.0)	(7.0)	%

The operating loss in EMEA ~~operating income declined~~improved by ~~$10.0~~$18.9 in ~~Q3 2021~~Q1 2022 compared to the prior year. The decrease was driven by lower revenue, partially offset by lower operating expenses. Operating income declined by $33.4 in year-to-date 2021 compared to the prior year. The decline was driven by lower revenue andyear which included a $17.6 goodwill impairment charge related to ~~the~~our Orangebox U.K. reporting ~~unit in Q1 2021, partially offset by lower operating expenses. Excluding the impact of~~unit. Adjusted for the goodwill impairment charge, the ~~year-to-date 2021 adjusted~~ operating loss improved by $1.3 driven by higher revenue and lower cost of ~~$14.2 represented~~sales as a ~~decline~~percentage of ~~$15.8 compared to the prior year.~~revenue, partially offset by higher operating expenses.

EMEA revenue represented ~~23.2%~~22.2% of consolidated revenue in ~~Q3 2021. Q3 2021~~Q1 2022. Q1 2022 revenue of ~~$143.3~~$123.6 represented ~~a decrease~~an increase of $25.1 or 15% compared to the prior year. The decrease was broad-based across most markets due to reduced demand from the COVID-19 pandemic and approximately $10 of delayed shipments as a result of the temporary operations shutdown during Q3 2021, partially offset by approximately $17 of shipments for a project in the education sector that was in the order backlog at the beginning of the quarter. Year-to-date 2021 revenue declined by $115.2$24.1 or 24% compared to the prior year. ~~The decrease~~Revenue in the prior year was ~~driven~~impacted by government mandates in response to the ~~same factors as~~COVID-19 pandemic which significantly limited our ability to manufacture and fulfill orders. After adjusting for $10.1 of currency translation effects, the ~~quarter.~~organic revenue growth was $14.0 or 13% compared to the prior year.

Cost of sales as a percentage of revenue ~~increased~~decreased by ~~590~~330 basis points ~~to 75.2% of revenue~~ in ~~Q3 2021~~Q1 2022 compared to the prior year. The ~~increase~~improvement was driven by ~~lower~~the higher revenue and unfavorable shifts in business mix (which included a higher mix of project business). Cost of sales as a percentage of revenue increased by 370 basis points to 75.0% of revenue in year-to-date 2021 compared to the prior year. The increase was driven by lower revenue and unfavorable shifts in business mix, partially offset by approximately $5$1 of lower overhead costs.

Operating expenses in ~~Q3 2021 decreased~~Q1 2022 increased by ~~$6.1~~$8.6 compared to the prior ~~year. The decrease was driven by~~year, which included approximately ~~$4 from lower discretionary spending, $2.5~~$5 of ~~lower variable compensation expense and approximately $2 of lower~~higher wage and benefit expenses ~~partially offset by~~as a result of temporary hour and pay reductions. The current year included $2.8 offrom unfavorable currency translation ~~effects. Operating expenses for year-to-date 2021 decreased by $30.8 compared to the prior year. The decrease was driven by~~effects and approximately ~~$20 from lower~~$1 of higher discretionary ~~spending, approximately $8 of lower wage and benefit expenses primarily related to temporary work hour reductions and $5.4 of lower variable compensation expense.~~

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spending.

Other

The Other category ~~in 2021~~ includes Asia Pacific and Designtex. Asia Pacific serves customers in ~~Asia~~Australia, China, India, Japan, Korea and ~~Australia~~other countries in Southeast Asia primarily under the Steelcase brand with ~~an emphasis on freestanding~~a

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comprehensive portfolio of furniture, ~~systems, seating~~architectural and ~~storage solutions.~~technology products. Designtex primarily sells textiles, wall coverings and surface imaging solutions specified by architects and designers directly to end-use customers through a direct sales force primarily in North America. ~~In 2020,~~


	Three Months Ended
Statement of Operations Data — Other	May 28, 2021				May 29, 2020
Revenue	$	56.7	100.0	%	$	49.4	100.0	%
Cost of sales	39.9		70.4		32.5		65.8

Gross profit	16.8		29.6		16.9		34.2
Operating expenses	22.1		38.9		18.5		37.4


Operating loss	$	(5.3)	(9.3)	%	$	(1.6)	(3.2)	%

The operating loss in the Other category ~~also included PolyVision which was sold during Q4 2020. PolyVision manufactures ceramic steel surfaces for use~~increased by $3.7 in various applications globally, including static whiteboards and chalkboards sold through third party fabricators and distributors to the primary and secondary education markets and architectural panels and other special applications sold through general contractors for commercial and infrastructure projects.

Three Months Ended Nine Months Ended
Statement of Operations Data — Other November 27,
2020 November 22,
2019 August 28,
2020 November 22,
2019
Revenue $ 57.8 100.0 % $ 95.9 100.0 % $ 168.9 100.0 % $ 286.9 100.0 %
Cost of sales 39.2 67.8 63.1 65.8 112.5 66.6 185.5 64.7
Restructuring costs — — — — — — — —
Gross profit 18.6 32.2 32.8 34.2 56.4 33.4 101.4 35.3
Operating expenses 20.8 36.0 29.5 30.8 59.1 35.0 86.9 30.2
Goodwill impairment charge — — — — — — — —
Restructuring costs — — — — — — — —
Operating income (loss) $ (2.2) (3.8) % $ 3.3 3.4 % $ (2.7) (1.6) % $ 14.5 5.1 %

Reconciliation of Operating Income (Loss) to Adjusted Operating Income (Loss) — Other Three Months Ended Nine Months Ended
November 27,
2020 November 22,
2019 November 27,
2020 November 22,
2019
Operating income (loss) $ (2.2) (3.8) % $ 3.3 3.4 % $ (2.7) (1.6) % $ 14.5 5.1 %
Add: goodwill impairment charge — — — — — — — —
Add: restructuring costs — — — — — — — —
Adjusted operating income (loss) $ (2.2) (3.8) % $ 3.3 3.4 % $ (2.7) (1.6) % $ 14.5 5.1 %

The Other category posted an operating loss of $2.2 in Q3 2021 compared to operating income of $3.3 in the prior year, which included $1.2 from PolyVision. The remaining decline was driven by lower revenue, partially offset by lower operating expenses. Year-to-date 2021 operating results decreased by $17.2Q1 2022 compared to the prior year. The ~~prior year results included $5.6 from PolyVision and the remaining decrease~~increase was driven by ~~the same factors~~higher operating expenses and higher cost of sales as ~~the quarter.~~a percentage of revenue, partially offset by higher revenue.

Revenue in the Other category represented ~~9.4%~~10.2% of consolidated revenue in ~~Q3 2021. Q3 2021~~Q1 2022. Q1 2022 revenue of ~~$57.8~~$56.7 represented ~~a decrease~~an increase of ~~$38.1~~$7.3 or ~~40%~~15% compared to the prior year. The ~~decrease~~increase was driven by ~~lower~~higher revenue in both Asia Pacific and ~~Designtex as a result of reduced demand due~~Designtex. Revenue in the prior year was impacted by government mandates in response to the COVID-19 pandemic which significantly limited our ability to manufacture and ~~a $14.9 impact from the PolyVision divestiture.~~fulfill orders. After adjusting for ~~the $14.9 impact of the divestiture and $0.6~~$1.7 of currency translation effects, the organic revenue ~~decline~~growth was ~~$23.8~~$5.6 or ~~29%~~11% compared to the prior year. ~~Year-to-date 2021~~

Cost of sales as a percentage of revenue ~~of $168.9 represented a decrease of $118.0 or 41%,~~increased by 460 basis points in Q1 2022 compared to the prior year. The ~~decline~~increase was driven by ~~the same factors as the quarter. After adjusting for the $48.2 impact of the divestiture and $1.8 of~~$0.7 from unfavorable business mix, $0.5 from unfavorable currency translation effects ~~the organic revenue decline was $68.0 or 29%, compared to the prior year.~~and $0.4 of higher logistics costs.

Operating expenses in ~~Q3 2021 decreased~~Q1 2022 increased by ~~$8.7~~$3.6 compared to the prior year. The ~~decrease~~increase was driven by approximately $4 from lower discretionary spending and a $2.9 impact from the PolyVision divestiture. Operating expenses for year-to-date 2021 decreased by $27.8 compared to the prior year, driven by approximately $10 of lower discretionary spending, a $8.8 impact from the PolyVision divestiture and approximately $6 of lowerhigher wage and benefit expenses ~~related to~~driven by temporary ~~salary reductions.~~pay reductions in the prior year and higher discretionary spending.

Corporate

Corporate ~~costs~~expenses include unallocated portions of shared service functions such as information technology, corporate facilities, finance, human resources, research, legal and customer aviation, plus deferred compensation expense and income or losses associated with COLI.

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		Three Months Ended				Nine Months Ended				Three Months Ended
Statement of Operations Data — Corporate	Statement of Operations Data — Corporate	November 27, 2020		November 22, 2019			November 27, 2020	November 22, 2019			Statement of Operations Data — Corporate		May 28, 2021		May 29, 2020
Operating expenses	Operating expenses	$	7.9	$	9.2			$	14.1		$	25.5		Operating expenses	$	5.8	$	2.6

The ~~decrease~~increase in operating expenses in ~~Q3 2021 compared to~~Q1 2022 was driven by $3.0 of higher deferred compensation expense, higher wage and benefit expenses as a result of temporary hour and pay reductions in the prior year ~~was driven by $2.0~~and $0.9 of ~~lower~~ variable ~~compensation expense and $1.2 of lower deferred~~ compensation expense, partially offset by ~~$1.8 of lower COLI income. The decrease for year-to-date 2021 was driven by $4.2 of~~ higher COLI income ~~$3.0~~ of lower variable compensation expense, lower wage and benefit expenses related to temporary salary reductions and lower discretionary spending, partially offset by an $1.2 increase in deferred compensation expense.$1.9.

Liquidity and Capital Resources

Cash and cash equivalents are used to fund day-to-day operations, including seasonal disbursements, particularly the annual payment of accrued variable compensation and retirement plan contributions in Q1 of each fiscal year. During normal business conditions, we target a range of $75 to $175 in cash and cash equivalents to fund operating requirements. In addition, we may carry additional liquidity for potential investments in strategic initiatives and as a cushion against economic volatility, and from time to time, we may allow our cash and cash equivalents to temporarily fall below our targeted range to fund acquisitions and other growth initiatives.

Liquidity Sources November 27,
2020 February 28,
2020
Cash and cash equivalents $ 484.4 $ 541.0
Company-owned life insurance 167.7 160.0
Availability under credit facilities 267.9 273.3
Total liquidity sources available $ 920.0 $ 974.3

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Liquidity Sources	May 28, 2021		February 26, 2021
Cash and cash equivalents	$	397.2	$	489.8

Company-owned life insurance	168.9		169.5
Availability under credit facilities	265.5		265.9
Total liquidity sources available	$	831.6	$	925.2

As of ~~November 27, 2020,~~May 28, 2021, we held a total of ~~$484.4~~$397.2 in cash and cash equivalents. Of that total, ~~88%~~85% was located in the U.S. and the remaining ~~12%~~15% was located primarily in China (including Hong Kong), Mexico, India, ~~Malaysia~~the United Kingdom and ~~the U.K.~~Malaysia.

COLI investments are recorded at their net cash surrender value. ~~A portion of our~~Our investments in COLI policies are intended to be utilized as a long-term funding source for long-term benefit obligations. However, COLI can also be used as a source of liquidity. We believe the financial strength of the issuing insurance companies associated with our COLI policies is sufficient to meet their obligations.

Availability under credit facilities may be reduced related to compliance with applicable covenants. See Liquidity Facilities for more information.

The following table summarizes our Condensed Consolidated Statements of Cash Flows for the ~~nine~~three months ended ~~November 27, 2020~~May 28, 2021 and ~~November 22, 2019:~~May 29, 2020:

Nine Months Ended
Cash Flow Data November 27,
2020 November 22,
2019
Net cash provided by (used in):
Operating activities $ 37.2 $ 218.8
Investing activities (17.8) (46.1)
Financing activities (76.6) (64.1)
Effect of exchange rate changes on cash and cash equivalents 1.8 (0.8)
Net increase (decrease) in cash, cash equivalents and restricted cash (55.4) 107.8
Cash, cash equivalents and restricted cash, beginning of period 547.1 264.8
Cash, cash equivalents and restricted cash, end of period $ 491.7 $ 372.6

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	Three Months Ended
Cash Flow Data	May 28, 2021		May 29, 2020
Net cash provided by (used in):
Operating activities	$	(63.6)	$	(93.4)
Investing activities	(13.0)		(2.7)
Financing activities	(16.8)		193.7
Effect of exchange rate changes on cash and cash equivalents	0.3		(1.3)
Net increase (decrease) in cash, cash equivalents and restricted cash	(93.1)		96.3
Cash, cash equivalents and restricted cash, beginning of period	495.6		547.1
Cash, cash equivalents and restricted cash, end of period	$	402.5	$	643.4

Cash ~~provided by~~used in operating activities


		Nine Months Ended					Three Months Ended
Cash Flow Data — Operating Activities	Cash Flow Data — Operating Activities	November 27, 2020		November 22, 2019		Cash Flow Data — Operating Activities	May 28, 2021		May 29, 2020
Net income		$	19.5	$	133.2
Net loss						Net loss	$	(28.1)	$	(38.1)
Depreciation and amortization	Depreciation and amortization	64.1		62.9		Depreciation and amortization	20.7		22.5
Goodwill impairment charge	Goodwill impairment charge	17.6		—		Goodwill impairment charge	—		17.6
Restructuring costs		27.0		—
Changes in accounts receivable, inventories and accounts payable	Changes in accounts receivable, inventories and accounts payable	41.8		(44.4)		Changes in accounts receivable, inventories and accounts payable	(6.3)		(4.8)
Employee compensation liabilities	Employee compensation liabilities	(130.5)		(8.8)		Employee compensation liabilities	(36.0)		(137.2)
Employee benefit obligations	Employee benefit obligations	(25.2)		(5.7)		Employee benefit obligations	(18.1)		(33.2)
Customer deposits	Customer deposits	30.4		6.2		Customer deposits	8.4		94.9
Changes in other operating assets and liabilities	Changes in other operating assets and liabilities	(7.5)		75.4		Changes in other operating assets and liabilities	(4.2)		(15.1)
Net cash provided by operating activities		$	37.2	$	218.8
Net cash used in operating activities						Net cash used in operating activities	$	(63.6)	$	(93.4)

Cash used in operating activities decreased in Q1 2022 compared to Q1 2021, driven by lower annual payments related to accrued variable compensation and retirement plan contributions. These payments totaled $50.4 in Q1 2022 compared to $148.0 in Q1 2021. In ~~year-to-date~~Q1 2021, we ~~generated~~offered additional cash ~~from working capital, primarily driven by collections on accounts receivable. We also offered deposit incentives~~discounts to our dealers which drove a significant increase in customer deposits ~~in Q1 and Q2 2021, which moderated in Q3 2021~~during the prior year as the incentives were discontinued. In year-to-date 2020, we utilized cash in working capital, primarily driven by strong revenue growth during that period. Annual payments related to accrued variable compensation and retirement plan contributions, typically made in Q1 each year, totaled $148.0 in year-to-date 2021 compared to $114.3 in year-to-date 2020. In year-to-date 2021, we paid $25.5 related to severance and other separation-related benefits for workforce reductions in our Americas segment which is reflected in the change in employee compensation liabilities. Changes in other operating assets and liabilities in year-to-date 2021 reflects a net $31.2 increase in income taxeQ1 2022.

~~s receivable.~~

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Cash used in investing activities


		Nine Months Ended					Three Months Ended
Cash Flow Data — Investing Activities	Cash Flow Data — Investing Activities	November 27, 2020		November 22, 2019		Cash Flow Data — Investing Activities	May 28, 2021		May 29, 2020
Capital expenditures	Capital expenditures	$	(32.1)	$	(49.1)	Capital expenditures	$	(18.4)	$	(9.4)
Proceeds from disposal of fixed assets		7.3		1.0

Other	Other	7.0		2.0		Other	5.4		6.7
Net cash used in investing activities	Net cash used in investing activities	$	(17.8)	$	(46.1)	Net cash used in investing activities	$	(13.0)	$	(2.7)

Capital expenditures in ~~year-to-date 2021 were lower compared to the prior year due to our continued focus on reduced spending and~~Q1 2022 were primarily related to investments in manufacturing operations, information technology, customer-facing facilities and product ~~development and customer-facing facilities. We sold land for proceeds~~development. Capital expenditures in Q1 2021 reflected reduced spending as a result of ~~$7.1 in year-to-date 2021.~~the COVID-19 pandemic. Other investing activities in ~~year-to-date~~Q1 2022 included $4.6 of proceeds from COLI policy maturities. Other investing activities in Q1 2021 included $3.3 of additional proceeds from the partial sale of an investment in an unconsolidated affiliate in ~~2018.~~2018 and $2.7 of proceeds from the sale of land.

Cash ~~used in~~provided by (used in) financing activities


		Nine Months Ended					Three Months Ended
Cash Flow Data — Financing Activities	Cash Flow Data — Financing Activities	November 27, 2020		November 22, 2019		Cash Flow Data — Financing Activities	May 28, 2021		May 29, 2020
Dividends paid	Dividends paid	$	(31.8)	$	(51.9)	Dividends paid	$	(12.1)	$	(8.4)
Common stock repurchases	Common stock repurchases	(42.7)		(8.7)		Common stock repurchases	(4.3)		(42.3)
Borrowings on lines of credit		250.0		—
Repayments on lines of credit		(250.0)		—
Net borrowings and repayments of debt						Net borrowings and repayments of debt	—		245.0
Other	Other	(2.1)		(3.5)		Other	(0.4)		(0.6)
Net cash used in financing activities		$	(76.6)	$	(64.1)
Net cash provided by (used in) financing activities						Net cash provided by (used in) financing activities	$	(16.8)	$	193.7

We paid dividends of ~~$0.07,~~ $0.10 and ~~$0.10~~$0.07 per common share in Q1 ~~2021,~~ Q22022 and Q1 2021, ~~and Q3 2021, respectively, and $0.145 per common share in each of Q1 2020, Q2 2020 and Q3 2020.~~respectively.

~~During year-to-date 2021,~~ ~~we borrowed and subsequently repaid $250.0 on our global credit facility.~~

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In ~~year-to-date 2021,~~Q1 2022, we repurchased ~~3,288,795~~353,196 shares of Class A common stock, ~~288,795~~all of which were made to satisfy participants' tax withholding obligations upon the issuance of shares under equity awards, pursuant to the terms of our Incentive Compensation Plan. In ~~year-to-date 2020,~~Q1 2021, we repurchased ~~524,379~~3,244,389 shares of Class A common stock, ~~279,379~~244,389 of which were made to satisfy participants' tax withholding obligations upon the issuance of shares under equity awards, pursuant to the terms of our Incentive Compensation Plan.

As of ~~November 27, 2020,~~May 28, 2021, we had $56.4 of remaining availability under the $150 share repurchase program approved by our Board of Directors in 2016.

Off-Balance Sheet Arrangements

During ~~Q3 2021,~~Q1 2022, no material change in our off-balance sheet arrangements occurred.

Contractual Obligations

During ~~year-to-date 2021,~~ ~~we borrowed and subsequently repaid $250.0 on~~Q1 2022, no material change in our ~~global credit facility.~~contractual obligations occurred.~~See~~ ~~Liquidity Facilities~~ ~~for more information.~~

Liquidity Facilities

Our total liquidity facilities as of ~~November 27, 2020~~May 28, 2021 were:


Liquidity Facilities	~~November 27,~~May 28, ~~2020~~2021
Global committed bank facility	$	250.0
Other committed bank facility	3.9
Various uncommitted lines	~~20.1~~19.2
Total credit lines available	~~270.1~~ 273.1
Less: Borrowings outstanding	(1.7)
Less: Other guarantees and letters of credit	~~(2.2)~~(5.9)
Available capacity	$	~~267.9~~265.5

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We have a $250.0 global committed ~~five-year~~ bank facility in effect through 2025. As of ~~November 27, 2020,~~May 28, 2021, there were no borrowings outstanding under the fa~~cility and~~ ~~$2.2~~facility, there were $5.9 of guarantees ~~reducing~~and letters of credit which reduced our ~~availability.~~ ~~As of November 27, 2020,~~availability, and we were in compliance with all covenants under the facility.

~~Our~~We have a $12.5 committed bank facility related to a subsidiary, which has current availability of $3.9 based on eligible accounts receivable of the subsidiary. As of May 28, 2021, $1.6 was outstanding under the facility.

The various uncommitted lines may be changed or canceled by the ~~banks~~applicable lenders at any time. There were no$0.1 of borrowings outstanding under the uncommitted facilities as of ~~November 27, 2020.~~May 28, 2021.

In addition, we have revolving credit agreements totaling ~~$37.3~~$28.9 which can be utilized to support bank guarantees, letters of credit ~~bank guarantees~~ or foreign exchange contracts. ~~Letters~~As of May 28, 2021, we had $3.9 in outstanding letters of credit and bank guarantees ~~of $12.4 were outstanding under~~against these ~~facilities as of November 27, 2020.~~agreements. There were no draws onagainst our letters of credit during ~~year-to-date 2021~~Q1 2022 or ~~year-to-date 2020.~~Q1 2021.

Total consolidated debt as of ~~November 27, 2020~~May 28, 2021 was ~~$482.8.~~$483.7. Our debt primarily consists of ~~$443.8~~$444.2 in term notes due in 2029 with an effective interest rate of 5.6%. In addition, we have a term loan with a balance of $36.8 as of ~~November 27, 2020 of $38.1.~~May 28, 2021. This term loan has a floating interest rate based on 30-day LIBOR plus 1.20% and is due in 2024. The term notes are unsecured, and the term loan is secured by our two corporate aircraft. The term notes and the term loan do not contain financial covenants and are not cross-defaulted to our other debt facilities.

Liquidity Outlook

~~At November 27, 2020,~~As of May 28, 2021, our total liquidity, ~~position,~~which is comprised of cash and cash equivalents and the cash surrender value of COLI, aggregated to ~~$652.1.~~$566.1. Our liquidity position, funds available under our credit facilities and cash generated from operations are expected to be sufficient to finance our known or foreseeable liquidity needs.

Our significant funding requirements include operating expenses, non-cancelable operating lease obligations, capital expenditures, variable compensation and retirement plan contributions, dividend payments and debt service obligations. We have flexibility over some of these uses of cash, including capital expenditures and discretionary operating expenses, to preserve our liquidity ~~position, and we~~position. We expect ~~our~~ capital expenditures to total approximately $65 to $75 in ~~2021 will not exceed $50~~2022 compared to ~~$73.4~~$41.3 in ~~2020.~~

~~Table of Contents~~

During Q1 2021, in response to the COVID-19 pandemic and related economic uncertainty, we took a number of actions to protect our liquidity, including borrowing under our global credit facility, temporarily reducing pay for most of our salaried workforce, eliminating travel and events, overtime, temporary labor and annual merit increases, and scaling back project spending. During Q2 2021, as we were able to resume our manufacturing activities globally and our revenue improved, we repaid all outstanding borrowings under our global credit facility, and by Q3 2021, we restored most of our global salaried workforce to full pay. In Q2 and Q3 2021, we implemented workforce reductions in our Americas segment, and we expect to maintain the majority of our other cost reduction efforts during the remainder of 2021.

On ~~December 17, 2020,~~June 23, 2021, we announced a quarterly dividend on our common stock of ~~$0.10~~$0.145 per share, or approximately ~~$12,~~$17, to be paid in ~~Q4 2021.~~Q2 2022. Future dividends will be subject to approval by our Board of Directors.

Critical Accounting Estimates

During ~~Q3 2021,~~Q1 2022, there have been no changes in the items that we have identified as critical accounting estimates.

Recently Issued Accounting Standards

See Note 2 to the condensed consolidated financial statements.

Forward-looking Statements

From time to time, in written and oral statements, we discuss our expectations regarding future events and our plans and objectives for future operations. These forward-looking statements discuss goals, intentions and expectations as to future trends, plans, events, results of operations or financial condition, or state other information relating to us, based on current beliefs of management as well as assumptions made by, and information currently available to, us. Forward-looking statements generally are accompanied by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “possible,” “potential,” “predict,” “project,”" "target” or other similar words, phrases or expressions. Although we believe these forward-looking statements are reasonable, they are based upon a number of assumptions concerning future conditions, any or all of which may ultimately prove to be inaccurate. Forward-looking statements involve a number of risks and uncertainties that could cause actual results to vary from our expectations because of factors such as, but not limited to, competitive and general economic conditions domestically and internationally; acts of terrorism, war, governmental action, natural disasters, pandemics and other Force Majeure events; cyberattacks; the COVID-19 pandemic and the actions taken by various governments and third parties to combat the pandemic; changes in the legal and regulatory environment; changes in raw material, commodity and other input costs; currency fluctuations; changes in customer demand; and the other risks and contingencies detailed in this Report, our most recent Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission. We undertake no obligation to update, amend, or clarify forward-looking statements, whether as a result of new information, future events, or otherwise.

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Item 3.Quantitative and Qualitative Disclosures About Market Risk:

The nature of market risks (i.e., the risk of loss arising from adverse changes in market rates and prices) faced by us as of ~~November 27, 2020~~May 28, 2021 is the same as disclosed in our Annual Report on Form 10-K for the year ended February ~~28, 2020.~~26, 2021. We are exposed to market risks from foreign currency exchange, interest rates, commodity prices and fixed income and equity prices, which could affect our operating results, financial position and cash flows.

Foreign Exchange Risk

During ~~Q3 2021,~~Q1 2022, no material change in foreign exchange risk occurred.

Interest Rate Risk

During ~~Q3 2021,~~Q1 2022, no material change in interest rate risk occurred.

~~Table of Contents~~

Commodity Price Risk

During ~~Q3 2021,~~Q1 2022, no material change in commodity price risk occurred.

Fixed Income and Equity Price Risk

During ~~Q3 2021,~~Q1 2022, no material change in fixed income and equity price risk occurred.

Item 4.Controls and Procedures:

(a) Disclosure Controls and Procedures. Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")), as of ~~November 27, 2020.~~May 28, 2021. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that as of ~~November 27, 2020,~~May 28, 2021, our disclosure controls and procedures were effective in (1) recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by us in the reports that we file or submit under the Exchange Act and (2) ensuring that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Internal Control Over Financial Reporting. There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our ~~third~~first fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1A. Risk Factors:

For a more detailed explanation of the risks affecting our business, please refer to the Risk Factors section in our Form 10-K for the fiscal year ended February ~~28, 2020.~~26, 2021. There have not been any material changes to the risk factors set forth in our Form 10-K for the fiscal year ended February 28, 2020, except for the following risk factors which supplement and update the risk factors previously disclosed and should be considered in conjunction with the Risk Factors section in our Form 10-K for the fiscal year ended February 28, 2020:

~~The COVID-19 pandemic has had, and is expected to continue to have, a significant and adverse effect on our business.~~

The COVID-19 pandemic and the actions taken by various governments and third parties to combat the spread of COVID-19 (including, in some cases, mandatory quarantines and other suspensions of non-essential business operations) caused significant disruptions in our manufacturing and distribution operations and supply chains during Q1 2021 and required many office workers globally to work from home on a temporary basis, which has had a negative impact on global demand for our industry. In response to these developments, we took a number of actions to reduce our spending, including temporary and permanent layoffs, temporary pay reductions and reduced spending on product development and strategic initiatives. These actions have had and may continue to have a negative impact on our employee retention and our growth strategies in the future.

The economic impacts of the COVID-19 pandemic have had a negative impact on many of our customers, particularly those in the retail, hospitality, automotive, aviation, energy and flexible real estate sectors, and thus has negatively affected our revenues and may increase credit risk for us and our dealers. In addition, the actions being taken by governments and third parties to prevent the spread of COVID-19 have resulted in increased working from home for an extended period of time, which has been impacting and may continue to impact overall demand for office furniture and our revenue.

The severity of these various impacts on our business will depend in part on the extent and duration of government quarantine or stay-at-home orders, the timing of when companies have their employees return to the office, the availability of government benefits and other stimulus efforts to mitigate the effects of the COVID-19 pandemic and the speed of the recovery of economic conditions globally and locally, all of which are highly uncertain and out of our control. The impacts of COVID-19 are far-reaching, and the duration and intensity of the impact on our business, our industry and the global economy are not yet fully known.

~~Table of Contents~~

We rely on the integrity and security of our information technology systems, and our business could be materially adversely impacted by extended disruptions, significant security breaches or other compromises of these systems.

We rely on information technology systems to operate and manage our business and to process, maintain and safeguard information essential to our business as well as information relating to our customers, dealers, suppliers and employees. These systems are vulnerable to events beyond our reasonable control, including cyberattacks and security breaches, telecommunication and internet failures, natural disasters and power loss. Such events could result in operational slowdowns, shutdowns or other difficulties; loss of revenues or market share; compromise or loss of sensitive or proprietary information; destruction or corruption of data; costs of remediation, repair or recovery; breaches of obligations to third parties under privacy laws or contracts; or damage to our reputation or customer relationships; each of which, depending on the extent or duration of the event, could materially adversely impact our business, operating results or financial condition.

In October 2020, we detected a cyberattack that resulted in unauthorized access to our information technology systems. To protect our systems during that cyberattack, we temporarily shut down our global operations, which resulted in a delay of approximately $60 in revenue from Q3 2021 to Q4 2021; however, we do not believe this incident had or will have a materially adverse impact on our business, operating results or financial condition or the effectiveness of our internal controls.26, 2021.

Item 2.Unregistered Sales of Equity Securities and Use of Proceeds:

Issuer Purchases of Equity Securities

The following is a summary of share repurchase activity during ~~Q3 2021:~~Q1 2022:

Period (a)
Total Number of
Shares Purchased (b)
Average Price
Paid per Share (c)
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans
or Programs (1) (d)
Approximate Dollar
Value of Shares
that May Yet be
Purchased
Under the Plans
or Programs (1)
(in millions)
8/29/2020 - 10/2/2020 3,241 $ 12.34 — $ 56.4
10/3/2020 - 10/30/2020 38,275 $ 10.70 — $ 56.4
10/31/2020 - 11/27/2020 2,685 $ 10.44 — $ 56.4
Total 44,201 (2) —

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Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	(d) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (1) (in millions)
2/27/2021 - 4/2/2021	353,196	$	14.16	—	$	56.4
4/3/2021 - 4/30/2021	—	$	—	—	$	56.4
5/1/2021 - 5/28/2021	—	$	—	—	$	56.4
Total	353,196	(2)		—

(1)In January 2016, the Board of Directors approved a share repurchase program permitting the repurchase of up to $150 of shares of our common stock.

(2)All of these shares were repurchased to satisfy participants’ tax withholding obligations upon the issuance of shares under equity awards, pursuant to the terms of our Incentive Compensation Plan.

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Item 6.Exhibits:


Exhibit No.			Description

31.1			Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2			Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1			Certification of CEO and CFO pursuant to 18 U.S.C. Section 1350, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS			Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH			Inline XBRL Schema Document
101.CAL			Inline XBRL Calculation Linkbase Document
101.LAB			Inline XBRL Labels LInkbase Document
101.PRE			Inline XBRL Presentation Linkbase Document
101.DEF			Inline XBRL Definition Linkbase Document
104			Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


STEELCASE INC.


By:			/s/ Robin L. Zondervan
			Robin L. Zondervan Vice President, Corporate Controller ~~and~~ & Chief Accounting Officer (Duly Authorized Officer and Principal Accounting Officer)

Date: ~~December 22, 2020~~June 25, 2021

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	Three Months Ended				Nine Months Ended
Computation of Earnings per Share	November 27, 2020		November 22, 2019		November 27, 2020		November 22, 2019
Net income	$	2.1	$	54.9	$	19.5	$	133.2
Adjustment for earnings attributable to participating securities	0		(1.1)		(0.4)		(2.6)
Net income used in calculating earnings per share	$	2.1	$	53.8	$	19.1	$	130.6
Weighted-average common shares outstanding including participating securities (in millions)	117.7		119.5		117.4		119.6
Adjustment for participating securities (in millions)	(2.9)		(2.3)		(2.5)		(2.3)
Shares used in calculating basic earnings per share (in millions)	114.8		117.2		114.9		117.3
Effect of dilutive stock-based compensation (in millions)	0.3		0.6		0.3		0.5
Shares used in calculating diluted earnings per share (in millions)	115.1		117.8		115.2		117.8
Earnings per share:
Basic	$	0.02	$	0.46	$	0.17	$	1.11
Diluted	$	0.02	$	0.46	$	0.17	$	1.11
Total common shares outstanding at period end (in millions)	114.9		117.2		114.9		117.2
Anti-dilutive performance units excluded from the computation of diluted earnings per share (in millions)	0		0		0		0


Fiscal year ending in February	Amount (1)
2021	$	12.6
2022	48.6
2023	42.0
2024	36.6
2025	34.2
Thereafter	92.6
Total lease payments	266.6
Less interest	33.3
Present value of lease liabilities	$	233.3


Q3 2021 Organic Revenue Decline	Americas			EMEA			Other			Consolidated
Q3 2020 revenue	$	690.9		$	168.4		$	95.9		$	955.2

Divestiture	—			—			(14.9)			(14.9)
Currency translation effects*	0.2			10.2			0.6			11.0
Q3 2020 revenue, adjusted	691.1			178.6			81.6			951.3
Q3 2021 revenue	416.4			143.3			57.8			617.5


Organic decline $	$	(274.7)		$	(35.3)		$	(23.8)		$	(333.8)
Organic decline %	(40)		%	(20)		%	(29)		%	(35)		%

* Currency translation effects represent the estimated net effect of translating Q3 2020 foreign currency revenues using the average exchange rates during Q3 2021.