HNI Corp. will restore management's pay after an unexpectedly profitable quarter.
The Muscatine-based office furniture maker earned net income of $12.6 million for the quarter that ended June 27, up from a $24 million loss the previous quarter, the company announced Thursday. CEO Jeff Lorenger told investors on a conference call that the company's board of directors approved a return to previous salary levels, beginning Aug. 9.
Lorenger is among those who will benefit after agreeing to a 25% pay cut to his base salary in April. He earned $927,000 in 2019, company filings show.
Other executives took a 15% pay cut beginning in April, while the rest of the salaried employees took 10% cuts.
The 11-member board of directors also will benefit. After agreeing to a 25% cut to the $180,000 retainer that the board members normally earn, the board's compensation will return to its previous level.
"We felt strongly that we should, you know, pull that investment forward and invest in our members," Lorenger said during Thursday's conference call. "We're confident that it's the right move, and we're confident we can maintain (HNI's success)."
Executives originally did not plan to revisit the pay cuts for six months, given the uncertain nature of the economy amid the coronavirus pandemic. But Lorenger said the business had weathered the dip relatively well.
Sales of workplace furniture were down 36% in the second quarter, compared to the same period last year. However, online sales were up 114%. Another line of business, HNI's residential building products, remained steady.
The company took other measures to cut costs in April, including furloughing some employees. HNI Treasurer Jack Herring declined to comment on how many workers were furloughed, or for how long.
The company also announced it plans to spend $35 million on capital expenses like machines and tools, down from the planned $65 million that HNI expected to spend at the beginning of the year.
Tyler Jett covers jobs and the economy for the Register. Contact him at 515-284-8215 and tjett@registermedia.com. Follow him on Twitter @LetsJett.
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Citing profits, Muscatine furniture maker restores pre-coronavirus pay for execs, board - Des Moines Register
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