Good morning. My name is Brent, and I will be your conference operator today. At this time, I would like to welcome everyone to the conference call to discuss the combination of HNI Corporation and Kimball International. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. Mr. McCall, you may begin your conference. Good morning. My name is Matt McCall. I'm Vice President, Investor Relations and Corporate Development for HNI Corporation. Thank you for joining us to discuss HNI Corporation's agreement to acquire Kimball International, which we announced earlier this morning. With me today on the call are Jeff Lorenger, Chairman, President, and CEO of HNI Corporation; Kristie Juster, CEO of Kimball International; and Marshall Bridges, Senior Vice President and CFO of HNI Corporation. We have posted a supporting slide presentation in the investors section of our website under Events and Presentations. Statements made during this call that are not strictly historical facts are forward-looking statements, which are subject to known and unknown risk. Actual results could differ materially. The news release and slide presentation posted on our website and on the SEC website include additional factors that could affect actual results. The corporation assumes no obligation to update any forward-looking statements made during the call. I'm now pleased to turn the call over to Jeff Lorenger. Jeff? Thanks, Matt. Good morning, everyone, and thank you for joining us to discuss today's news. This is a very exciting day for both HNI Corporation and Kimball International. I will take you through an overview of the transaction and discuss the compelling strategic rationale. Kristie will then share her perspective on this combination. Marshall will outline the financial benefits in more detail. I will provide some concluding remarks, and then we will answer your questions. Let me start by saying that with this transaction, we will be creating a stronger platform to drive significant value for HNI members and Kimball International employees and shareholders, dealers, and customers of both companies. The combination accelerates our growth trajectory and is aligned with strategic initiatives already underway in our Workplace Furnishings segment. There are five key points that summarize the strategic rationale for today's announcement. First, as a combined company, we will be able to deliver more value to customers and dealers through a broader, more comprehensive product offering, a tailored go-to-market strategy utilizing the strong brand positions of both HNI and Kimball International, and enhanced manufacturing capabilities, which will support customer service levels and drive efficiency. Second, the combination will better position HNI to take advantage of attractive dynamics in ancillary products, which is an area of strength for Kimball International. With return-to-office activity increasing, customers are becoming more comfortable with defining their own unique hybrid work strategies, which emphasize a more collaborative work environment as it relates to office location, size, and layout. These post-pandemic layouts increasingly use ancillary products to support flexibility, collaboration, and privacy. Together, HNI and Kimball International will have a leading suite of ancillary products. Our company will be at the forefront of reaching a broader base of customers who are making investment decisions to respond and adapt to evolving office trends. Third, Kimball International's strong presence in the secondary geographies will enable our company to benefit from post-pandemic trends. Specifically, secondary and tertiary geographies have benefited from population migration patterns and elevated return-to-office dynamics. Two topics we have discussed on several of our recent earnings calls and areas where we anticipate continued growth. Fourth, our companies fit very well together, and we have similar cultures and values. We both have a strong commitment to customer service and operational excellence. Our cultures are focused on respect, integrity, and community engagement, and we both work to make a difference in the lives of our people, our customers, our communities, and the environment. Fifth, this transaction will deliver attractive financial benefits. These include annualized cost synergies of $25 million and significant additional opportunities to accelerate growth through more resilient and diverse revenue streams. I will now provide some background on Kimball International for those on the call who may not be familiar with them. Kimball International is a company we know well and have respected for their reputation and their capabilities in the commercial furnishings industry. The company has a well-recognized family of brands serving the workplace, health, and hospitality segments. They bring extensive furnishings expertise built over 70 years and have strong relationships with a broad customer base. In addition, Kimball International has an extensive manufacturing footprint across eight locations with strong complementary capabilities. In calendar year 2022, Kimball International delivered $719 million in revenue and $53 million of adjusted EBITDA. I'd like to turn the call over to Kristie to share her thoughts on the transaction. Kristie? Thank you, Jeff. It is a pleasure to be here to share what is an important next step in Kimball International's history as we enter into an agreement to join HNI. We believe this is the right move for our shareholders, our customers, our business, and for our people. Our shareholders will realize significant and immediate value, as well as the ability to participate in the ongoing upside of a stronger combined company. Our employees will have more opportunities for career growth and development as part of a larger, more diversified industry leader, one with similar values to ours. I am incredibly proud of what we have built at Kimball International and what we have been able to accomplish because of our team's commitment and dedication. We are confident that this transaction with HNI represents the ideal fit for our family of brands and will deliver enhanced value to all of our stakeholders. I'll now turn it back to Jeff. Thanks, Kristy. Before turning the call over to Marshall, I want to reiterate the key benefits we expect to realize from this transaction. With expanded capabilities, a more comprehensive brand portfolio, a tailored go-to-market strategy, we'll be better positioned to reach a broad range of customers who are making changes to meet evolving return-to-office dynamics. On the operations front, combining the companies will give us enhanced manufacturing capabilities to better serve customers, improve supply chain dynamics, and provide increased ordering efficiency. With that, let me hand it over to Marshall to discuss the compelling financial attributes of the transaction. Marshall? Thanks, Jeff. I'll walk through an overview of the key terms of the deal and why we think this is such an attractive opportunity both in the short and long term. This is a cash and stock transaction with a total value of approximately $485 million, which represents an enterprise value of approximately $531 million. This implies an attractive enterprise value multiple of approximately 6.8x calendar year 2022 adjusted EBITDA, inclusive of anticipated synergies. In terms of the consideration, Kimball International shareholders will receive $9 in cash and 0.1301 HNI shares for each share of Kimball International they own. Based on yesterday's closing price, the total consideration is $12.90 per share and represents a premium of approximately 81% versus Kimball International's 30-day VWAP. Following completion of the transaction, HNI shareholders will own approximately 90% of the combined companies, and Kimball International shareholders will own approximately 10%. We have fully committed bridge financing in place and plan to obtain permanent financing prior to closing. Net leverage is expected to be approximately 2.3x at closing. That modest level of leverage and our history of strong cash flow generation provide continued flexibility to support future growth. We expect the transaction to be completed by mid-2023 upon receipt of required regulatory approval and satisfaction of other customary closing conditions, including approval by Kimball International's shareholders. On a pro forma basis following the acquisition, HNI will have consolidated revenue of approximately $3.1 billion and adjusted EBITDA inclusive of expected synergies of approximately $290 million, which implies an adjusted EBITDA margin of approximately 9%. As Jeff mentioned earlier, we have identified $25 million of cost synergies, which are split between operating expenses and cost of goods sold. At a high level, the operating expense synergies include benefits from integrating logistics and eliminating duplicative public company costs. The operational savings in cost of goods sold include procurement savings and manufacturing efficiencies. In addition to the cost synergies, we see opportunities for meaningful revenue growth with our enhanced reach into high-growth areas. I'll now turn it back over to Jeff to wrap up our comments. Thanks, Marshall. Before opening the call to your questions, I want to note again that HNI has long admired Kimball International and the work that they do. As we evaluated bringing our two companies together, we had an opportunity to learn more about the Kimball International team, we are impressed by the company, their people, their culture, and their brands. As important as the benefits we have highlighted, I must emphasize that ultimately, this transaction is about our people, our similar cultures, and our shared core values, all of which are critical to creating a strong, successful combination. We look forward to welcoming the talented Kimball International employees to HNI. Both HNI and Kimball International are aligned around providing exceptional products to our customers, we look forward to bolstering this commitment as we become one team that is stronger together. Thank you again for joining us. We are now happy to take your questions. At this time, I would like to remind everyone, in order to ask a question, press star then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Reuben Garner with Benchmark Company. Your line is open. Thank you. Good morning, everyone. Congrats on the deal. Let's see. Can we start with both companies kind of have unique go-to-market or distribution strategies? Can you talk about how that's gonna look for the combined entity? Any cross-selling opportunities within Workplace? I know the product portfolio is a little bit different. If you could just kinda talk about the plans or how you see that playing out? Yeah, Reuben, I think as we've noted, the, you know, the portfolios are very complementary to each other. You know, Kimball has open-line distribution and is in multiple places, and we have similar approaches with some of our brands. Look, we think there's a lot of upside in cross-selling and in revenue synergies going forward. Just given the nature, candidly, of the portfolios, they bring some strength to us, and we bring some strength to them. You know, we're well-positioned also for the post-pandemic trends with the product and the secondary geography. When you net that all together, we like the coverage model, and we like the product portfolio, you know, synergies. To get just a little bit more specific. You know, the open-line strategy that Kimball has, I mean, that will remain in place and do you guys at HNI have products that you'll be able to run through that pipeline as well as kinda conversely, you know, pulling some of Kimball's ancillary products into your aligned dealers? Does it go both ways? Look, I mean, yeah, I think that will remain in place. I think all of those are distinct possibilities. Maybe we could take a step back. I probably should ask this first, but I guess the impetus. Was this a shop deal? Like, what went into Kimball kind of, you know... How did the acquisition come about? Yeah, look, as I said, you know, we've known Kimball International for many years. I've been in the industry 20+ years and had high regard and high respect for how they do business, the way they do business, and we see them in the marketplace on a regular basis. You know, as we looked around and we looked at where the markets are heading, where the post-pandemic office is heading, you know, we said this could be a great combination for all the stakeholders. We made an approach and started a dialogue. As I said, you know, these deals are won and lost on culture and fit. You know, that's a key for this value creation proposition. We really line up well there. They do business the way we do business, and you combine that with the product and the post-pandemic market trends. It just made a lot of sense for us and for them. On the synergy side, specifically the cost of goods, any more detail you can give there? Does that include any kind of rationalization efforts longer term or is, you know, is it more of an optimization? I know you guys have had some issues getting labor in the past, maybe this diversifies you. Any color there would be helpful. On the cost of goods side, Reuben, we see benefits from procurement savings and just general optimization across the networks. We have somewhat complementary manufacturing networks where there's strengths in both, and we're gonna aim to take advantage of both of them and be more efficient as a whole. That's about where we are right now in providing additional detail. Okay, I'm gonna sneak one more, kind of long shot in there. The Hospitality business that Kimball has, is there any, as part of the deal or, maybe leveraging it for your parts business, or is that not necessarily a driving force? I think we have a lot of respect for all of their brands, but we don't have any plans at the moment to try to drive synergies between our Residential Building Products segment and Hospitality. Okay, great. Thanks, guys. Congrats again. Thanks. Your next question is from the line of Greg Burns with Sidoti & Company. Your line is open. Morning. I just wanted to kind of better understand the distribution synergy and I guess, you know, how the two companies come together and whether you see potential dyssynergies in combining the two footprints. Thank you. Yeah, Greg. As we stated, I think the companies come together nicely just given the, like you said, the product portfolio, you know, overlays are complementary. You know, it's early days, but like we've operated in the marketplace. Kimball International has been operating in the marketplace. We think it's highly complementary on all fronts and do not see a lot of or really any revenue dyssynergies. Really see upside. Greg- Okay. You know, we both have a lot of open-line brands that coexist in a wide variety of dealer networks right now and have been doing that for, you know, decades. We don't see any dyssynergies from that regard, and we're excited about the cross-selling opportunities. Okay. Do you think that that dynamic changes at all now? I mean, obviously you're scaling up, maybe becoming more of a competitive threat to the other channels where you were able to have these open-line relationships. Look, Greg, you know, I think the longstanding, you know, pattern here is great product and great capability and customers really make those decisions. The portfolios, the coverage, the service models, the, you know, are really have been driving that, and I think will continue to drive that even more so in the post-pandemic world. Okay. Kimball has a solid presence in the health market. Do you have any presence in that market, or is this kind of a new, adjacent vertical opportunity for you? Yeah, no, we do not have any. We do some admin, don't get me wrong, but we really don't have a presence in healthcare. That's a, that is a new vertical for us. Okay. With Kimball's Poppin business, it's a little different distribution model. How does that play with your digital capabilities, digital strategies? You know, how does that enhance that go-to-market for you? Well, you know, we're early days. They, obviously, it's a well-known brand, and they have a lot of capabilities that have been built up in that business. We really have to kind of peel that back and see what the interfaces are and, you know, what we can take advantage of, you know, as we go. You know, like I said, it's a strong brand, well-recognized. Okay. Does Kimball have any brands that, or product categories that go through that, like that wholesale, that lower end, your lower-end kind of channel, you know, through the wholesale distribution? I think historically maybe they had some, but I don't think they really have a lot that goes through there. If it is, it's de minimis. You know, it's minimal. Greg, it's small. They have some exposure much smaller than ours. In terms of the $25 million of synergies, just looking at the absolute number relative to Kimball's total cost of goods and SG&A, it looks a little low. I mean, just compared to like what we saw when Knoll and Herman Miller got together. I mean, is this just What's your view on that? Is that kind of conservative view on what you could generate from the business? In terms of the timing, how much of that do you expect to get this year? Greg, it's early on. We're confident in a minimum of $25 million of synergies on an annual basis. We also have revenue benefits we've alluded to, which are not included in that $25 million. As importantly or maybe more importantly, we see Kimball International as having a strong business with really strong prospects that are gonna generate growth and value moving forward, regardless of the synergies. As it relates to timing, you know, some of these synergies are gonna take a little bit of time around the logistics and the operational efficiencies, but we will see some of the costs come out in 2023. We'll probably be, you know, at a $5 million annual run rate in the back half of this year, assuming it closes in the middle of the year. We'll reach the full run rate during 2025. Don't know if that answers your questions. Yep. No, that's perfect. Thanks. I'll pass it. Your next question is from the line of Rex Henderson with Water Tower Research. Your line is open. Good morning. Congratulations on what looks like strategically a really, really interesting combination. Congratulations to all involved. I had to drop off the call for about 30 seconds as questioning began, so excuse me if there's anything I ask that's duplicative. First of all, I wanted to follow up on the distribution network. Is there any overlap at all in the dealer networks at all geographically? You know, Rex, sure there's some overlap. Like I said, I think, there's an open-line piece that's really big that really isn't an overlap. I mean, it's an overlap in the sense that we both are selling into similar dealers. On the aligned side, you know, they have some dealers in some of markets where we have some dealers. By and large, they're in some places that we probably need some help in and vice versa. Like I said, it's a pretty clean deal that way. Okay. Thank you. Excuse me if I dig into the financial weeds a little bit, but I'm always interested in deals like this, whether they're gonna be ROIC positive. Marshall, can you comment on whether this will be ROIC positive initially, or at what point you think it can be return on invested capital positive for HNI? Yeah, Rex, we think of things in terms of economic profit, so, you know, the dollars associated with ROIC. We do expect it to be positive in 2024. We would see, you know, positive benefits from both economic profit and ROIC during that year. Okay. Okay, thank you for your time, and good luck. I think this is a very interesting deal. Thanks, Rex. Your next question comes from the line of Budd Bugatch with Water Tower Research. Your line is open. Hi there, and my congratulations as well, to on the transaction to all. It does strategically look like a pretty good fit. I'm gonna try to beat a little bit of the dead horse on this distribution of the open-line. I think what's interesting to me is that both companies have significant open line distribution. I think Greg kind of got there and asked what about the competitive response to that as you got larger into that area. I wonder if we could punch into that a little bit, maybe quantitatively. Can you perhaps disclose or give us an idea of how much of your open line distributor products go through the channels where aligned distribution competes with those open lines and you've been allowed to sell into that aligned distribution part of the industry? Any way to quantify that, Marshall, for us? We're not able to quantify that. Obviously, both HNI and Kimball International sell broadly. That means that we do have, you know, meaningful amount of revenue flowing through all kinds of distribution, including the competitively aligned distribution. I think our view, Budd, is that we've established positions in that broad set of distribution because we're offering up compelling value to the customers, and we view that the customer gets to decide these things. We view that as something that should stay that way. I understand. I'm just not sure that some others might agree with that, with those... I'm talking necessarily about your competitors. The other side of this is also interesting to me is that both of your companies, both companies have made significant efforts into the electronic distribution world. HNI with a couple of, I thought, fascinating acquisitions in HNI and Kimball obviously with Poppin. I'm curious as to what you see in the synergies of that and how that works on the revenue side, and what might it look like in 2024, 2025 as you bring those together, if you care to give us a comment? You know, Bud, it's early. You know, we do have a couple of platforms, and Kimball International has that platform. We will peel that onion back and kind of look at what's possible. As you know, those are dynamic. That world is dynamic, and they've even had some initiatives going and leverage that into contract distribution, which we will dig into as we go with their team. Those efforts are early on as well. I think it's probably too early to really get into the weeds on that. Jeff, I'm sure you've thought about how that's gonna be organized strategically because that's, I think that's gonna be critical to the success of that. I know Poppin was, I think, looking for a CEO of that particular. Kimball was looking for a CEO to run Poppin going forward. I'm just curious if there's any way you can share organizationally how you think that's gonna look going forward. I think that Kimball International has pretty good digital capabilities, you know, Poppin and their core business included. We're certainly gonna try to accelerate those capabilities with what we've been working on, but we're not in a position to provide detail around how that's gonna play out right now. Okay. That's fair enough. I'm not surprised that that would be the answer. I think it's a proper answer at this point in time. Last, are there any other regulatory hurdles besides HSR and shareholder, Kimball shareholder approval that you need? Yeah. No, Bud. Those are the two issues, main points. That's it. When do you think the S-4 gets printed and the shareholder meeting gets held for Kimball? Maybe that's a question for Kristy. I'm not sure. I don't know that we have the timeline precisely laid out yet, Budd. That's gonna be into the future a bit. Okay. Well, congratulations again on the transaction, which looks to be like a really strategic one. Thank you for taking my questions. Yep. Thanks, Budd. Again, if you would like to ask a question, press star one on your telephone keypad. Your next question is from the line of Kathryn Thompson with the Thompson Research Group. Your line is open. Hi. Thank you for taking my questions today. Stepping back and looking at the bigger picture, just in terms of if we could first address, just reaffirm, are there any significant geographic differences between the two companies and as you think about combining them? Kimball and HNI certainly have, you know, pretty specified end markets, especially Kimball focusing on workplace, health and education, hospitality. Are there any ways you can think about complementary and quantifying it? Do you have a combined end market exposure that you're able to share today? We'll just start with those two, and then we'll move to other questions. Hi, Kathryn. look, we're both broadly distributed and participate in a pretty wide array of vertical markets, but we're not able to quantify that today. We are excited about how we do fit together. Generally, we are in most geographic markets with a pretty strong presence. Although, as Jeff alluded to earlier, there are some markets where we're stronger than they are and vice versa, which we think we can, you know, leverage to be stronger more broadly. Regards to your questions, we're not in a position to give details around exact exposures and where we see benefits geographically. Okay, thanks. Given from the differences in some manufacturing production differences, what are some of the best practices that you see early on that could benefit beyond just pre-buy, but just in terms of for materials? What are other some of the manufacturing synergies that you could see in terms of how differences in terms of how you approach manufacturing? Yeah, look, at a, at a high level that, you know, there's in the logistics area, the way we operate, there is, they have really strong capabilities in soft goods. You know, upholstery goods, we have strong capabilities in metal and task. There's just a lot of complementary capabilities that can be, you know... We won't, we will not have to invest in some of those, and they won't have to invest as we, as we grow together. The we really like that profile. From a sales standpoint, understand that the channel is, has some crossover. Often what we find with, particularly with specified type companies, that there can be differences in terms of how the sales process is focused, and particularly in terms of how comp is set up, and differences between companies. What can you talk about any differences between the two entities in terms of how they go to the market and, the comp structure that's set up? You know, Kathryn, I think at a high level, the go-to-market strategies in this space and with these product categories and the two businesses are 80/20 similar. I mean, there's nuances, I think, and we'll probably combine best practices, but. You know, I don't see radical differences in go-to-market selling. Like I said, we are in some of the same distribution areas they are, and they see us, and we see them historically. On the comp, I think that's a little more in the weeds. We will obviously be reconciling that as needed as we go. Both, you know, both. And then the other thing is there's just multiple brands to carry around, and we have a similar approach. I don't think there's gonna be big differences there. Okay. From a corporate governance standpoint, will there be any crossover with board seats? You know, how does that look with the combined company? Yeah, no, there's not anticipated to be any crossover. Okay. Just as a combined company, what does this do for you as a public company from a trading standpoint? What are some of the anticipated benefits? Obviously, you're larger and bigger EBITDA, but thinking more from a average daily trading volume into, you know, and some of the key trading metrics that are important for today's market. What information can you share just in terms of the impact from a public equity trading standpoint? Thank you. Yeah, those impacts are positive, Kathryn. I think they're difficult to quantify, but I think what the combination makes us a stronger company in the marketplace. We're better positioned to take advantage of post-pandemic trends and deliver good financial results. It also gives us some advantages as, you know, from the trading and the capital markets. Those are difficult to quantify. Okay. Final question. I know we're talking about office furniture now, but you have this great hearth business. Is there any type of crossover to that, or is that just truly a separate business? How do you think about your hearth business, what, if any, changes are there, given today's announcement? Yeah, Kathryn, we do have that is a great business. That's not the focus for today. No, we don't anticipate any changes relative to that. We're gonna keep on keeping on running that business the way we have and investing, you know, in our category expansion efforts and, you know, maintaining, you know, maintaining that strong growth in revenue and earnings engine. Okay, perfect. Thanks very much, and congrats. Thank you. There are no further questions at this time. Mr. Lorenger, I turn the call back over to you. Thank you again for joining us today. We look forward to speaking with you in April to discuss our first quarter 2023 results. Have a great day. This concludes today's conference call. You may now disconnect.