Jasper-based Kimball International Inc. (Nasdaq: KBAL) says the highest quarterly sales total in more than 15 years was not enough to drive increased profit. The manufacturer is reporting third quarter net income of $10.9 million, compared to $11 million. Without one-time charges related to the retirement of former Chief Executive Officer Bob Schneider, the company says profit would have increased six percent.
Current CEO Kristie Juster says the company experienced double-digit organic order growth, which coupled with a "strong" order backlog, helped drive a positive third quarter. She added "we continue to be challenged by higher transportation, steel, and other commodity costs, as well as tariffs that have been implemented along with additional tariff increases in the future. We are working to mitigate these cost increases by negotiating pricing with suppliers, continuous improvement initiatives, price increases and our previously announced $7 million cost reduction initiatives and anticipate these actions will offset the higher costs beginning in the second quarter of fiscal year 2019 and beyond. Our return on capital was higher than any of the public companies in the office furniture industry."
Late last month, Kimball International announced the acquisition of David Edward, an upholstered products maker. Net sales in the third quarter came in at more than $194 million, up from $175.3 million during the same period a year earlier.
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