Herman Miller, Inc. · Herman Miller, Inc. Reconciliation of Non-GAAP Measures (values represent % of net sales) (unaudited) Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11 Earnings Before

Herman Miller, Inc.Business OverviewQ4 FY2011

NASDAQ: MLHR

Working together to deliver strong returns for shareholders and employees alike.

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Forward Looking StatementsThis information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act, as amended, that are based on management’s beliefs, assumptions, current expectations, estimates, and projections about the office furniture industry, the economy, and the company itself. Words like “anticipates,” “believes,” “confident,” “estimates,” “expects,” “forecasts,” likely,” “plans,” “projects,” “should,” variations of such words, and similar expressions identify such forward-looking statements.

These statements do not guarantee future performance and involve certain risks, uncertainties, and assumptions that are difficult to predict with regard to timing, extent, likelihood, and degree of occurrence. These risks include, without limitation, employment and general economic conditions, the pace of economic recovery in the U.S, and in our International markets, the increase in white-collar employment, the willingness of customers to undertake capital expenditures, the types of products purchased by customers, competitive-pricing pressures, the availability and pricing of raw materials, our reliance on a limited number of suppliers, currency fluctuations, the ability to increase prices to absorb the additional costs of raw materials, the financial strength of our dealers and the financial strength of our customers, the mix of our products purchased by customers, our ability to attract and retain key executives and other qualified employees, our ability to continue to make product innovations, the success of newly introduced products, our ability to serve all of our markets, possible acquisitions, divestitures or alliances, the outcome of pending litigation or governmental audits or investigations, political risk in the markets we serve, and other risks identified in our filings with the Securities and Exchange Commission.

Therefore, actual results and outcomes may materially differ from what we express or forecast. Furthermore, Herman Miller, Inc., undertakes no obligation to update, amend or clarify forward-looking statements.

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A history of bold innovation

Constantly improving

Recognized leadership

The Past

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A History of Bold Innovation

1923 1930s & 40s 1950s 1960s 1970s & 80s 1990s Today

Founded as a manufacturer of traditional residential furniture

Fostered lasting ties with well-known,

independent designers; a model

that continues to this day

Became a leader in modern

furniture design

Transformed the office furniture industry with

the introduction of Action Office – the

industry’s first open plan office system

Pioneered ergonomic

office seating

Broadened product offering, expanded

distribution, focused on

manufacturing efficiency and sustainability

A recognized industry leader in the areas of

innovative product design, sustainable business

practices, and financial performance

At Herman Miller, we value our rich legacy more for what it shows us we might become than as a picture of what we’ve been.

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Solution Design

Independent Distribution

Social Responsibility

Operational Excellence

People & Culture

Constantly Improving

We operate under the assumption that there is always a path to improvement; a better way of addressing a problem. This attitude is

foundational to everything we do. We call it, “Performance Innovation.”

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Recognized Leadership

Our focus on constant improvement has been widely recognized

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Herman Miller around the world

Variable cost structure

Commitment to innovation

Diversified revenue base

Recent operating performance

Debt & liquidity profile

The Present

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Herman Miller Around the World

Manufacturing Locations

Design Center Showrooms

Global Product Distribution:

North America: ≈ 250 Dealer Locations

Worldwide*: ≈ 740 Dealer Locations

* Including Posh Alliance dealer locations

Dealer Logistics & Support Centers

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Variable Cost Structure

We have designed our cost structure to flex with the economic cycles we face as an industry.

• Manufacturing Costs

Direct labor – use temps and overtime which can be quickly flexed with volume

Direct materials – assembly based model (subassemblies outsourced)

Overhead – assembly based model (only 12-14% of sales)

Freight & Distribution – Utilize third-party outside freight haulers

• SG&A Costs

Incentive compensation – EVA based on continuous improvement

Sales costs – Variable commissions

Distribution costs – Variable cost independent dealers

Designer royalties – Variable cost independent designers

• Capital Base

Assembly based manufacturing model keeps asset costs low

Build to order keeps inventory costs low

Early prepay discounts keeps accounts receivable balances low

EVA incentive systems focuses on balance sheet and income statement

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Commitment to Innovation

Design & Research Expenditures

$0

$10

$20

$30

$40

$50

$60

2007 2008 2009 2010 20110.0%

0.3%

0.6%

0.9%

1.2%

1.5%

1.8%

2.1%

2.4%

2.7%

3.0%

3.3%

$ Millions % Net Sales

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We Have Diversified Our Revenue Base

Int'lU.S. Office

/ Gov't

Health, Home &

Educ.

FY 2001

U.S. Office / Gov't

Int'l

Health, Home &

Educ.

24%

23%

53%

16%

9%

75%

FY 2011

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Recent Operating Performance

$322$365

$381 $394

$412$462

$415

$368

$442 $449

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

Millio

ns

Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11

Quarterly Net Sales & Orders

Net Sales Orders

$95

$99

$107$107

$114

$85

$90

$95

$100

$105

$110

$115

Millio

ns


Quarterly Adj. Operating Expenses *

* Note: Excludes restructuring charges and P&L impact of adjustments to contingent purchase liabilities.

Gross Margin and Adj. Operating Income % *

33.0%32.1%32.9%

32.5%32.8%

3.1% 6.5%7.1% 6.2% 7.2%

0%

10%

20%

30%

40%

50%


% N

et

Sa

les

Gross Margin % Operating Income %

Q4 sales increased 37% from the prior year; New orders up 23% over the same period.

Sequential-quarter gross margin improvement driven by higher factory production levels and lower relative price discounting. These favorable items were partially offset by higher commodity and incentive bonus expenses.

Operating expense increase in Q4 versus Q3 driven by variability against higher sales, seasonally higher marketing expenses, and higher employee incentive expenses.

Sequential quarter operating contribution margin (Q3 to Q4 FY2011) totaled 22%.

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Debt & Liquidity Profile

$36

$10

$22$21

$38

$0

$5

$10

$15

$20

$25

$30

$35

$40

Millio

ns


Quarterly Cash Flow from Operations

2.7 2.62.5 2.3

1.7

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0


Rolling 4Qtr Leverage Ratio(Debt to EBITDA* - excluding restructure)

PPN & Bank Covenant < 3.50 (but can go up to 4.0 for 4 Qtrs)

5.35.8 6.1

6.5

7.7

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0


Rolling 4Qtr Coverage Ratio(EBITDA* to Interest - excluding restructure)

Bank Covenant > 4.0

Q4 Ending Cash and Equivalents of $149 million.

$140 million unused revolver capacity.

Paid off $100 million in public bonds during Q4 (using $50 million in cash and $50 million in proceeds from a private placement debt issue).

Debt maturity schedule:

PPN ($50M) due 2014

PPN ($150M) due 2017

PPN ($50M) due 2021

Contributed $38 million to employee pension plans during Q4 ($23M of cash / $15M in company stock).

Reduced total unfunded pension liability by $71 million in fiscal year 2011.

* Represents a Non-GAAP Measure, see Appendix for reconciliation.

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Strategic intent

Catalysts for growth

“Share of Wallet”

e-Commerce

Why Herman Miller?

The Future

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Strategic Intent

We will add value to our shareholders through the application of Performance Innovation in all areas of our business.

We will achieve best-in-class financial performance by serving our customers with a comprehensive offering of innovative products, knowledge, and services,

all delivered with bullet-proof reliability.

We will achieve this by investing strategically in the following areas:

•Primary Markets: Increase our share of the contract office furniture market

•Adjacent Markets: Pursue growth opportunities in environments such as healthcare, higher education and retail

•Developing Economies: Expand our geographic reach in areas of the world with significant growth potential

•New Markets: Develop new products and technologies which serve new market opportunities

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Catalysts for Growth

Growth Avenues

Benchmark Performance

Seating

Breadth of New Products

Healthcare Furnishings

Global Distribution

New Channels to Market

New Technologies

* The acquisitions of Brandrud and Nemschoff give us the industry’s most comprehensive healthcare

furniture offering

* Planned acquisition of Posh significantly expands our Asian

distribution presence

* Improved dealer efficiency through the Herman Miller Performance

System (HMPS)

* Robust product development queue

* Dealer “Share of Wallet”

* We are the industry leader in high-performance task seating

* Herman Miller for the Home has a growing retail and wholesale

presence

* e-Commerce

* Solutions addressing customer space utilization and energy

management

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We Intend to Increase our North American Dealer “Share of Wallet”

35% - 40%

Non-HMI Products

60% - 65%

HMI Products

On average, 35% to 40% of the sales through our dealer channel in North America involve non-Herman Miller branded products.

Setu - 2009

Lower Price-Point Seating

SAYL- 2010

Performance Tables

Everywhere Tables - 2010

Ergonomic Solutions

Thrive Portfolio - 2010

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e-Commerce

In 2010, we launched a direct-to-consumer website called The Herman Miller Store.

Our goal: To build brand awareness and communicate the Herman Miller story to a greater number of retail customers.

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Why Herman Miller?

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AppendixThis report contains references to Adjusted Operating Income and Earnings Before Interest, Taxes,

Depreciation, and Amortization (EBITDA) which are both non-GAAP financial measures.

Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11Net Sales 321.5$ 380.7$ 412.2$ 414.8$ 441.5$

Operating Earnings 1.28% 7.67% 7.64% 7.50% 7.16%Add: Restructuring Expenses 2.99% 0.24% 0.51% 0.00% 0.00%Less: Adj. to Contingent Purchase Consideration -1.15% -1.39% -1.07% -1.30% 0.00%

Adjusted Operating Income 3.11% 6.51% 7.08% 6.20% 7.16%

Table IHerman Miller, Inc.

Reconciliation of Non-GAAP Measures(values represent % of net sales)

(unaudited)

Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11Earnings Before Income Taxes (EBT) 34.8$ 49.6$ 61.3$ 75.3$ 102.4$ Add: Depreciation 39.7 38.8 37.7 36.6 36.2 Amortization 3.0 3.0 2.9 2.8 2.8 Interest 21.7 20.7 20.6 20.7 20.0 Other Adjustments 1 15.2 8.4 3.5 (1.7) (7.3) Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) 114.4$ 120.5$ 126.0$ 133.7$ 154.1$

Total Debt, End of Trailing Period 311.2$ 311.2$ 309.4$ 309.4$ 259.4$

Rolling 4-Quarter Debt-to-EBITDA 2.7 2.6 2.5 2.3 1.7

Rolling 4-Quarter EBITDA-to-Interest 5.3 5.8 6.1 6.5 7.7

1 "Other Adjustments" include, as applicable in the period, non-cash stock based compensation expenses, charges associated with business restructuring initiatives, changes in the value of the contingent consideration components of the Nemschoff purchase price, and pro-forma income statement adjustments associated with Nemschoff, as permitted under our lender covenant arrangements.

Trailing 4-Quarter Period Ended

Reconciliation of Non-GAAP Measures(Calculation of EBITDA Ratios)

($ in millions)(unaudited)

Table IIHerman Miller, Inc.

21© 2011 Herman Miller, Inc., Zeeland, MI 49464

Herman Miller, Inc. · Herman Miller, Inc. Reconciliation of Non-GAAP Measures (values represent % of net sales) (unaudited) Q4 FY10 Q1 FY11 Q2 FY11 Q3 FY11 Q4 FY11 Earnings Before

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