2020 Annual Report
Total Page:16
File Type:pdf, Size:1020Kb
HOME SATELLITE 2020 Annual Report OFFICE COMMUNITY SPACES HUB © 2021 Knoll, Inc. All rights reserved. Printed in the United States. The Thriving Workplace Ecosystem Corporate Information Officers Board of Directors Locations Andrew B. Cogan Andrew B. Cogan Knoll, Inc. Muuto Chairman of the Board Director Knoll Office KnollStudio Østergade 36-38 and Chief Executive Officer Chairman of the Board KnollExtra KnollTextiles DK-1100 Copenhagen and Chief Executive Officer 1235 Water Street Denmark Charles W. Rayfield East Greenville, PA 18041 Senior Vice President and Roberto Ardagna 215 679-7991 For showrooms and sales offices: Chief Financial Officer Director muuto.com For showrooms and sales offices: Christopher M. Baldwin Daniel W. Dienst knoll.com HOLLY HUNT President and Chief Operating Director 801 West Adams Street # 700, Officer, Knoll Office Edelman Leather Chicago, IL 60607 Stephen F. Fisher 80 Pickett District Road 312 329-5999 Benjamin A. Pardo Director New Milford, CT 06776 Executive Vice President and 860 350-9600 For showrooms and sales offices: Director of Design Jeffrey A. Harris hollyhunt.com Director For showrooms and sales offices: Michael A. Pollner edelmanleather.com Senior Vice President, Jeffrey Alan Henderson Spinneybeck | FilzFelt Chief Administrative Officer, Director 425 CrossPoint Parkway General Counsel and Secretary Fully Getzville, NY 14068 Ronald R. Kass 117 SE Taylor St 716 446-2380 Roxanne B. Klein Director Suite 301 Senior Vice President, Portland, OR 97214 For showrooms and sales offices: Human Resources Christopher G. Kennedy 888 508-3725 spinneybeck.com Director Esohe M. Omoruyi For showrooms and sales offices: Executive Vice President, John F. Maypole fully.com Consumer and Digital Commerce Director Sarah E. Nash Executive Offices Director Knoll, Inc. Stephanie Stahl 1235 Water Street Director East Greenville, PA 18041 215 679-7991 knoll.com Stock Listing New York Stock Exchange Ticker Symbol: KNL Independent Registered Public Accounting Firm Ernst & Young One Commerce Square Suite 700 2005 Market Street Philadelphia, PA 19103 Transfer Agent and Registrar Computershare Trust Company, N.A. PO Box 43023 Providence, RI 02940-3023 www.computershare.com Dear Fellow Stockholders: 2020 was a year of unprecedented challenge due to the both our WFH e-commerce activity as well as across our Covid-19 pandemic. I could not be prouder of the way residential brands and channels. E-commerce activity at Fully our team rose to the occasion to support clients, dealers, and Knoll set quarterly records, growing 239% versus the prior the architectural and design community, and fellow Knoll year, representing just over 10% of our total sales. With associates. We are fortunate that our range of offerings industry estimates for WFH suggesting that 20% of all spans from work from home (WFH) brands, including Fully and employees will continue to work remotely to some extent, this Knoll + Muuto, to residential lifestyle brands like HOLLY HUNT, trend, combined with new products for the WFH market, is KnollStudio and Muuto to more mainstream workplace brands, expected to be a tailwind for Knoll during 2021 as we expand including Knoll Office, KnollTextiles and Spinneybeck | FilzFelt. our strategies across e-commerce, digital and mobile, and Across this constellation, our associates kept our plants and brick and mortar efforts in North America and Europe. our warehouses operational, re-opened showrooms where permitted and found new and innovative ways to connect The Office Isn’t Going Away digitally and in-person with designers, commercial clients and While there is active debate about the future of the office, residential customers. nothing today can replace the mix of culture, connectivity We are especially pleased that our long-term strategy and creativity it offers. Covid-19 has had a dramatic impact on of diversifying sources of revenue, both organically and the way we work and live, with office space demand through acquisition, moving away from a sole dependence decreasing between 22 and 38 percent. With this change, on commercial workplace sales, paid off during this however, a new forward-thinking definition of the workplace unpredictable time. In fact, residential sales from our Knoll, ecosystem is emerging. This ecosystem is characterized by a Fully, HOLLY HUNT and Muuto brands increased to a record flexibility in where and when one works—a hybrid between in- $107 million in the fourth quarter, representing over a third o f office collaboration as the hub of activity and the our fourth quarter 2020 revenue, up from a fth in 2019. This convenience of remote work. contributed measurably to offsetting a 22% decline in 2020 We believe that now is the time for organizations to reassess commercial workplace sales. the central role of the workplace in light of the expanding For the full year, we posted revenue of $1.24 billion, a supporting roles of WFH, coworking, satellite and community decrease of 13.4% versus 2019. While gross margin spaces. This moment also provides an opportunity to reset decreased 260 bps to 35.8% versus the prior year and EPS organizational culture and support employee well-being. declined substantially to $0.95, actions taken to reset our To this end, we are collaborating with our clients to identify and cost structure, combined with the favorable shift to residential codify well-being strategies as part of a new workplace activity, allowed us to protect our protability. These actions planning platform called The Thriving Workplace, which included the closure of our Grand Rapids manufacturing we expect to be a much-needed tool as organizations facility and consolidation of our North American warehouse return to the office. You can download our white paper, locations scheduled for June 2021. The Thriving Workplace: Embracing a New Narrative at knoll.com/thriving-workplace. You can also visit knoll.com/ Importantly, we solidied our nancial position with a knoll-works to request a copy of Knoll Works 2021, our $164.0 million convertible preferred offering to prudently publication showcasing clients who have made a commitment manage a challenging commercial ofce environment and to agile, inspiring spaces by relying on our planning capabilities execute on our digital and residential initiatives that led to our and constellation of brands. strong outperformance of our ofce benchmarks. We are also responding to the emerging hybrid with new Our Digital and Residential Future workplace and WFH products. These include Rockwell ® ® We benetted from the pandemic accelerating e-commerce Unscripted Creative Wall architectural elements that activity for work from home (WFH) and residential furniture. enhance circulation and space delineation for co-creation, During the fourth quarter, we experienced continued growth in focused work and project team workplace “neighborhoods,” This annual report contains forward-looking statements that are based on numerous assumptions about future events and conditions which may prove to be inaccurate. See “Forward-Looking Statements” beginning on page 28 of this annual report. acoustical products from Spinneybeck | FilzFelt, 1–3 day In addition, we conducted an Environment, Social and delivery WFH furniture at knoll.com and the robust WFH Governance (ESG) materiality assessment in accordance offering at fully.com. We are also continuing to work with with Global Reporting (GRI) standards and published a commercial clients to establish WFH programs for their sustainability report that provides transparency on our employees. performance and aims for the future with respect to such areas as the environmental impact of our operations footprint, Community Impact including greenhouse gas (GHG) emissions; associate health Giving back to the communities where we live and work has and safety; and supply chain and risk management. been part of the Knoll culture since our founding. During 2020, we made good progress on our corporate social + + + responsibility and diversity and inclusion commitments. We launched two new initiatives to help build more equitable, inclusive communities—the Knoll Diversity Advancement No operations, marketplace or community impact initiative Design Scholarship for Black Students and a corporate is realized without the dedication of our 3,082 associates partnership with Habitat for Humanity. These programs, worldwide, whose health and well-being continues to be our along with our role as the founding sponsor of the World number one priority. As we move forward, we are committed Monuments Fund Modernism at Risk program, are to continuing to bring a contemporary perspective to how fundamental to our citizenship in the design world. we work and live, a vision that reflects our modern heritage. The Knoll Diversity Advancement Design Scholarship for I thank our associates, suppliers and our dealer and retail Black Students is an annual scholarship available to rising partners for their dedication. Knoll is modern always because Black-identifying first year students in the United States modern always works. or Canada who are pursuing studies at two- or four-year institutions. The Habitat for Humanity + Knoll corporate partnership is an extension of our commitment to good design and sustainable building practices; we are partnering with Habitat to contribute to its mission to provide families with safe, sustainably built homes. A component of the partnership allows consumers to donate to Habitat for Andrew Cogan Humanity when making a purchase at knoll.com or a Chairman and CEO Knoll Home Design Shop in New York and Los Angeles. Knoll, Inc. Knoll Associates will be able to participate in volunteer opportunities with Habitat when it is safe to do so. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 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 No. 001-12907 KNOLL, INC. (Exact name of registrant as specified in its charter) Delaware 13-3873847 (State or other jurisdiction of (I.R.S.