05.09.16 GIVING VOICE TO THOSE WHO CREATE WORKPLACE DESIGN & FURNISHINGS...

05.09.16 GIVING VOICE TO THOSE WHO CREATE WORKPLACE DESIGN & FURNISHINGS

CITED:“DISCOVERY CONSISTS NOT IN SEEKING NEW LANDS BUT IN SEEING WITH NEW EYES.” —MARCEL PROUST

Vitra From Milan to Chicago

Following on the heels of its remarkable showing at Salone in Milan, Swiss design company Vitra has big plans for Chicago and NeoCon 2016. Officeinsight publisher Bob Beck recaps the company’s Milan event spaces and provides a preview of all that awaits at NeoCon this year – large-scale creative program announcements, new work from a host of great designers, and a special off-site demonstration space for Vitra Retail.

FULL STORY ON PAGE 3…

Montroy Andersen DeMarco Designs Modern Open Of-fices for the United Nations in NYC

The modern workforce we’re a part of is incredibly mobile, and some careers and industries are more inclined to this fluid work style. UNOPS, an operational arm of the United Nations (UN), is an organization that takes the idea of a mobile workforce to the next level. In its New York City offices, UNOPS wanted a new space that would nurture the contemporary way its teams were now working. It also needed to solve a spatial challenge their teams’ irregular work schedules presented; the UNOPS per-sonnel include landmine removal specialists and development experts who frequently leave on assignments with short notice.


Kimball Office Introduces Bauhaus-Inspired KORE by Swiss Designer Daniel Korb

May is ripe with new introductions we’ll soon see in Chicago at NeoCon 2016, and we’re excited to be able to report on some of the most exciting news. KORE, launched last week by Kimball Office, is a clean, modern furniture collection of tables, benching and mobile cart solutions designed by award winning product designer Daniel Korb. Designed for simple human needs, KORE was inspired by and embodies the best of the Bauhaus Move-ment design principles, experienced through the lens of the 21st Century.


05.09.16 GIVING VOICE TO THOSE WHO CREATE WORKPLACE DESIGN & FURNISHINGS PAGE 2 OF 42

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Hella Jongerius’ spinning color-wheels in CasaVitra at Fuorisalone, Milan. Photography courtesy of Vitra

Following on the heels of its remark-able showing at Milan, Swiss design company Vitra has big plans for Chicago and NeoCon 2016. The trend for the biggest names at the Milan Furniture Fair (Salone Internazionale del Mobile di Milano, or just “Salone” to aficionados) is to exhibit at both the official fair on the outskirts of Milan and then complement that with a space downtown, often a company’s permanent showroom. This expansion of design-related events to include downtown venues along with Salone is now known as “Fuorisalone.”

This year Vitra went all out, hosting a space at the fair and two Fuorisa-lone spaces. In one of those typically

fabulous spaces in Milan – this one the site of Antonio Citterio’s former studio – Vitra installed CasaVitra.

Vitra From Milan to Chicagoby Bob Beck

A view of the courtyard of CasaVitra


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There was much to be seen at CasaVitra, but the main attraction was a series of huge ceiling mounted color wheels demonstrating how various col-ors and materials in the Vitra product lines can work together. The moving color wheels were one part of a library of color and material that has been the culmination of 10 years of work by Hella Jongerius, Vitra’s art director for Colors and Materials. For a bit of inspiration and just under five minutes of your billable time, check out this video and save my writing thousands of hard to follow words: Casa Vitra at Fuorisalone 2016

Then, next door to CasaVitra on Via Maroncelli, its second Fuorisalone installation was a pop-up shop selling a variety of Vitra design objects with accessories curated to complement them. Meanwhile, at its huge stand back at the Salone itself, Vitra show-

An interior view of CasaVitra

View from inside Vitra’s Pop-up Shop at Fuorisalone, Milan

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companiescased its many products, including new ones by Jasper Morrison and the Bouroullec brothers.

It is primarily these new products and a continuation of the ambitious approach to multiple locations that Vitra is working to bring to Chicago, just five weeks from now. For starters, some form of Hella Jongerius’ material library will be avail-able for the NeoCon crowd to experi-ence, hopefully including her new book.

Starting with its foundational work with Ray and Charles Eames, Vitra has been a company that has kept a rather rigid stance regarding the sanctity of the product designer’s original intent for each product. Sometimes this attitude has meant losing projects because the project designer wanted certain modifications that fell outside Vitra’s sense of where the boundary of creative adaptability fell.

In an attempt to maintain its stan-dards but become more open to such creative adaptability, at NeoCon Vitra will announce a new program whereby it will attempt to optimize collaboration with client project teams – providing direct dialogue and unprecedented access to Vitra’s top industrial de-sign talent to custom-develop radi-cally new product applications on an organizational scale.

In terms of new products in the more typical sense, the company will be officially launching Konstantin Grcic’s Hack “disruptive” workstation system that we first saw as a concept at Orgatec 2014 and at NeoCon last year. This year, Hack has matured into a standard product line ready for order entry and normal production leadtimes.

You may (or may not) recall that Hack represents the work of Grcic in collaboration with an un-named Silicon Valley startup where the primary driver is flexibility. Thus it is available on heavy “industrial grade” casters, it folds up for easy moving or storage, and the basic rectangular footprint with panels on three sides can be con-

The All Plastic Chair (APC) designed by Jasper Morrison

Modular sofa designed for Vitra by Jasper Morrison, as displayed at the Milan Furniture Fair

A Hack family-portrait showing various adaptable configurations


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verted into sofas and beds and sundry other atypical applications – perfect for those upstart start-ups. What you’ll see at NeoCon is some product refinements that bring Hack into the

realm of a specifiable product, even if remaining in a small market niche.

officeinsight subscribers have clicked on the ad for the Belleville Chair at a record pace, and NeoCon

attendees will be able to experience it in person. In addition to the chair, Ronan and Erwan Bouroullec have designed an approach to a table leg that can be applied to a whole series

The Belleville Chair and Bistro Table at the VitraHaus CaféKaari shelving and Aalto stools from Artek

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companiesof tables from a simple bistro table to full-on conference or worktable, to say nothing of a dining table. Chairs and tables are available in a range of

materials from plastic to wood, and the chairs can be upholstered in fabric or leather as well. My homerun spotter instinct kicked in the second I saw the

ad, and I’m looking forward to seeing the family in person.

Vitra now owns Artek, and appar-ently one of its first acts as the new owner of that historic company was to put the Bouroullec brothers on the design of a new system of wall-mounted shelving. Based for support on a simple, yet elegant steel loop, the resulting product is called Kaari, and once the Bouroullecs arrived at the design for the support loop, they saw it could also be applied to a table system. This simple, elegant design strikes me as completely consistent with the Artek Manifesto of 1936 [see officeinsight: Artek and the Aaltos: Creating a Modern World].

Vitra fans know that it has had two subsidiary companies – Vizplay, specializing in custom store fixtures for (mostly) high-end retail establishments, and Vizona, for the project manage-ment and production of custom fixtures for “branded” retail spaces. These two subsidiaries have now been merged into the new Vitra Retail.

Two product lines of Vitra Retail, Kado and Invisible Wall System will be shown in an off-site, by-invitation demonstration space where both retail applications and office adaptations will be on display. Dubbed “Transversal Elements by Vitra Retail” comprises wall-mounted and freestanding archi-tectural elements, including media walls, phone booths, office storage products, column wraps and space dividers.

It’s an aggressive agenda and should offer NeoCon attendees something out of the ordinary – with a definite European slant. Don’t be surprised if you bump into me there.n

The Invisible 6PL wall mount system with integral lighting. One of Vitra Retail’s Transversal Elements

Tranversal Elements

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A multi-purpose lounge provides a new space for UNOPS staff to work, relax and socialize. Photo: by Ajit Menon

The modern workforce we’re a part of is incredibly mobile, and some careers and industries are more inclined to this fluid work style.

UNOPS, an operational arm of the United Nations (UN), is an organization that takes the idea of a mobile workforce to the next level. Providing logistical, technical, and man-agement knowledge and support for the UN, many of the UNOPS’ 7,000+ personnel are spread across 80 countries and are busy working on multiple projects around the world.

In its New York City offices, UNOPS leadership wanted a new space that would nurture the contemporary way its teams were now working. It also needed to solve a spatial challenge their teams’ irregular work schedules presented; the UNOPS person-nel include landmine removal specialists and development experts who frequently leave on assignments with short notice.

NYC-based A&D firm Montroy Andersen DeMarco (MAD-GI) designed the UNOPS’s new $2.6 million, 15,000 square foot office and operations center – a significant departure from the UNOPS’ previous NYC workspace.

“They came to us with a request to change to open plan, and this was a very big cultural change for their organization and the way they work,” said Shauna Dack, interior design-er at MADGI. “People can shy away from that big a change, and the one thing we tried to do from the very beginning was to communicate closely with the UN staff through each phase of the project.”

Influenced by the UNOPS headquarters in Copenhagen, Denmark, a new open layout would reflect a shift in con-ceptual thinking about what the NYC office could be – from offering each UN team member “ownership of individual space” to that of “ownership of entire space.” The bulk of the office is now dedicated to shared amenities.

The project team removed traditional private offices and cubicles, and introduced a 3,700 square foot open work area with 70 sit-to-stand Haworth workstations, six 2 to 3 person carrels, and a handful of soundproofed offices for conference calls, meeting spaces or individual office space on an as-needed basis.

Montroy Andersen DeMarco Designs Modern Open Offices for the United Nations in NYCby Mallory Jindra


a&d

A conference suite, divisible from one large boardroom for 50 into three separate smaller conference spaces, provides the staff with tailoring options; two additional enclosed meeting rooms for up to 6 people and numerous touchdown work and collaboration areas round out the design layout. Meeting spaces feature extensive audiovisual systems allowing for tele-conferencing with coworkers and other partners around the world.

The new UNOPS workspace offers its staff many amenities that were not available in its old offices. Located on the 14th floor at 708 Third Avenue in Manhattan, the new full-floor offices offer employees 3 outdoor spaces to relax or hold meetings in – a big upgrade from the UN’s old digs at the Chrysler Building.

A large multi-purpose lounge area and pantry provide new spaces for employ-ees to work, relax and socialize in. A 150

Architect Montroy Andersen DeMarco has completed the $2.6 million, 15,000 square foot office and operations center of the United Nations Office for Project Services (UNOPS) in Manhattan. Photo: by Ajit Menon

UNOPS’ 3,700 square foot open plan office area with 70 workstations features adjustable height desks and a LED lighting system that adjusts to the amounts of natural daylight harvested from multiple windows. Photo: by Sasha Maslov


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square foot wellness/meditation/parent-ing privacy room features dimmable lights and furniture you can melt into. The office is also equipped with a shower and lockers for employees heading to or returning from field assignments.

MADGI selected neutral finishes with accents of blue in recognition of the UNOPS’s place in the greater UN family of organizations. Light wood floors and glass divider walls inject a modern, transparent quality – some-thing the UNOPS sought to maximize in its new domain.

During furniture showroom tours, UN leadership expressed a preference for solutions centered on practical-ity and flexibility. The space features Haworth office furniture, along with Arper and Design Within Reach lounge and residential style furniture.

MADGI’s design concept provided soundproofed booths for small meetings, quiet work, and conference phone calls. Photo: by Ajit Menon

Floor plan for the new UNOPS offices in NYC.


a&d“They wanted to be able to pull

apart the furniture to suit their needs at the time, and eventually chose to work with the Haworth solutions,” noted Ms. Dack.

Additional selections include:> Tagwall glass office front system>Modernfold Acousti-seal system 932

paired panel modular wall with a white board finish on all modular surfaces

>Filzfelt acoustical panels in the privacy/meditation room

>Avant Contract carpet tile in the Glow style and Boulder color

>Forest Stewardship Council-certi-fied European White Oak wide plank hardwood floor by USF Contract, Cita-del collection, Bastion series, Chateau color, in the reception

>Schonox poured resilient flooring>gypsum board ceilings in reception

and main conference room>Armstrong drop acoustical ceilings

in offices and meeting rooms

A large multi-purpose lounge area and pantry provides an additional space for informal social events, presentations and meetings as well as access to an outdoor terrace. Photo: by Sasha Maslov

The new UNOPS office houses a conference suite that is divisible from one large boardroom for 50 people into three separate smaller conference spaces. Photo: by Ajit Menon


a&dThe design team made many deci-

sions with a focus on sustainability – a high priority for both MADGI and the UN. The new space is designed to meet LEED standards, should the UN pursue accreditation.

MADGI situated the largest and most frequently occupied open office area nearest to windows to provide natural light for employees and reduce artificial lighting energy use. And, as part of an energy management system that harvests natural daylight, a linear LED lighting system includes lighting

fixtures that dim when the daylighting is particularly bright in a space.

In addition to past projects, MADGI is currently designing two additional spaces for the United Nations in Man-hattan – the UN Women office and the UN Development Programme (UNDP).

“We spend a good amount of time working with nonprofits, said Ms. Dack. “And both types of clients are concerned with functionality on many levels, but nonprofits are especially tuned into this.”

UNOPS Project Manager Geoff

Graves, who oversaw the design and construction efforts, was instrumental in bridging the work between MADGI design and UNOPS teams.

“This transition required an exten-sive collaboration with the staff and consultants, in order to ensure their needs were properly met from the early design phase onwards,” said Mr. Graves, in the project’s release announcement. “In addition, we had to ensure that the design achieved all of its functional and sustainability goals within the defined budget.” n

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Architect and designer Daniel Korb employed Bauhaus style principles to design KORE, a comprehensive furniture collection for Kimball Office.

The challenge in designing a new piece of furniture is always to stay fresh and to offer something, well, new to customers who increasingly need their furniture to do more for them.

KORE, launched this week by Kimball Office, is a comprehensive furniture collection designed by award winning product designer Daniel Korb. Designed for simple human needs and to add value to both work and living environments, KORE was inspired by and embodies the best of the Bauhaus Movement design principles, expe-rienced through the lens of the 21st Century.

KORE is composed of conference, occasional, mobile and standing height tables; mobile cart solutions; and benching systems complete with

Kimball Office Introduces Bauhaus-Inspired KORE by Swiss Designer Daniel Korbby Mallory Jindra

KORE: Benching


product designstorage, privacy screens and technol-ogy options. The product portfolio also encompasses all necessary elements for privacy, media integration, and sharing and learning solutions.

The collection was imagined for of-fices, conference rooms, work lounges and learning environments; and while that may seem like a tall order to fill with just one collection, the simplicity of KORE indeed makes this possible.

Bauhaus Design found its beginnings after World War One, a time when people were looking for something that would move them forward into a light, new world. In this way, the Bauhaus Movement embodied a changing world that incidentally triggered a chang-ing environment. In designing KORE, Mr. Korb employed Bauhaus Design’s modernity and simplicity of structure to 21st century needs. KORE: Learning solutions

KORE: Conference


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“We wanted to apply Bauhaus thinking to move forward. Today, that changing world is driven by technol-ogy, and human beings have to adapt to that with new environments,” said Mr. Korb. “Create the right environ-ment, and you create the right state of mind.”

As an architect, Mr. Korb says he designs from a holistic point of view:

“We don’t use furniture in isolation, on its own. Furniture is architecture on a different scale. It is structure, surface, form, volume, hue.”

Mr. Korb designed KORE to be rooted in simplicity of form:

“It’s not another bench – the bench was not a starting point. Simplicity was the starting point. My thinking is very basic. If something is not simple,

KORE: Conference

KORE: Benching


product design

it doesn’t happen. If it’s too complex, people won’t use it. We often forget or overlook the basics.”

But, simplicity is a huge challenge, and it competes with many other fac-tors.

“You want choices and diversity as well as simplicity, and those are con-tradicting targets.”

Aesthetically, KORE is clean and malleable – a collection that can shift and drop into new and existing envi-ronments with ease. In shaping KO-RE’s aesthetic, Mr. Korb focused less on the Kimball portfolio (although it does fit quite seamlessly), and instead zeroed into designing for the customer – and every type of customer.

“The collection has a certain time-less, modest quality so that it inte-grates and adapts well,” said Mr. Korb. “A table from KORE will fit well in a

KORE: Tables

KORE: Table detail


product designmonastery in Germany, an old brew-ery, or a modern office.”

KORE’s comprehensive makeup enables users to adapt and change their environments to suit their needs. The collection’s tables are about as versatile as you can get – designed for conferencing, benching, learning and lounge functions, and available in six tabletop shapes, six frames, a variety of heights (occasional, working and standing-height), and mobile options.

Mr. Korb distinguishes KORE as the strongest structured benching system he’s designed thus far.

“It’s important to separate structure from surface – the surface must come second. Part of the challenge is strip-ping down the structure so that it’s most efficient. People see new bench-ing all the time, but what’s behind the design, and underneath the bench, can be surprising.”

Mr. Korb also noted the importance of injecting added value into a new design.

“That’s an abstract concept, but you must be able to layer values on top of each other. It must look great, work great, and be sustainably made.”

How do you prioritize dozens of competing needs – privacy, flexibility, collaboration, focus – in designing new solutions?

“Forget furniture for a moment, and

focus on the environment. There are hundreds of needs, and they all make sense. The needs will change, and so you must think about a full range of scenarios. Enable the user to create their own environment.

To that end, KORE’s mobile options are super fresh. The collection in-cludes 10 types of mobile cart options

KORE “Thought Starters”: Inspiration on the Kimball Office website

KORE: Table tech detail


product designwith a range of built-in functions, in-cluding seating, storage, markerboard, media screen capability, wardrobe, and basic privacy screen options.

Mr. Korb is a person equally full of conceptual thinking and real-world practicality. He believes furniture is much more than a tool, but his under-standing of that notion pulls from an innately pragmatic place:

“Our first layer of contact is clothing, and the second layer we come into contact with is furniture.”

If you have a chance to chat with Mr. Korb at the Kimball Office showroom during NeoCon, do take advantage. Talk to him about KORE, about design, and about the human condition.

“I think I am not an architect of Switzerland, but an architect of happiness.” n Daniel Korb, architect and designer of KORE for Kimball Office

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r-d connectionRESEARCH-DESIGN CONNECTIONBenefits of Enhanced Ventilationby Sally Augustin, Ph.D.

There are clear benefits to enhanced building ventilation. MacNaughton and colleagues report that they “estimated the energy consumption and associ-ated per building occupant costs for office buildings in seven U.S. cities, representing different climate zones for three ventilation scenarios (stan-dard practice (20 cfm/person), 30% enhanced ventilation, and 40 cfm/person) and four different heating, ventilation and air conditioning (HVAC)

system strategies (Variable Air Vol-ume (VAV) with reheat and a Fan Coil Unit (FCU), both with and without an energy recovery ventilator)…[and] estimate[d] the economic benefit of increased productivity associated with increasing ventilation rates.”

The team learned that, “Doubling the ventilation rate from the American Society of Heating, Refrigeration and Air-Conditioning Engineers minimum cost less than $40 per person per year in all climate zones investigated…The same change in ventilation improved the performance of workers by 8%, equivalent to a $6500 increase in em-ployee productivity each year. Reduced absenteeism and improved health are also seen with enhanced ventilation.” n

P. MacNaughton, J. Pegues, U. Satish, S. Santanam, J. Spengler, and J. Allen. 2015. “Economic, Environ-mental and Health Implications of En-hanced Ventilation in Office Buildings.” International Journal of Environmental

Research and Public Health, vol. 12, no. 11, pp. 14709-14722.

Sally Augustin, PhD, a cognitive sci-entist, is the editor of Research Design Connections (www.researchdesigncon-nections.com), a monthly subscription newsletter and free daily blog, where recent and classic research in the social, design, and physical sciences that can inform designers’ work are presented in straightforward language. Readers learn about the latest re-search findings immediately, before they’re available elsewhere. Sally, who is a Fellow of the American Psycho-logical Association, is also the author of Place Advantage: Applied Psychol-ogy for Interior Architecture (Wiley, 2009) and, with Cindy Coleman, The Designer’s Guide to Doing Research: Applying Knowledge to Inform Design (Wiley, 2012). She is a principal at Design With Science (www.designwith-science.com) and can be reached at [email protected].

MATERIAL OF THE WEEK

MC# 6773-19DESIGNBOARD: These durable high-density polyethylene (HDPE) sheets can be used as wood or metal alternatives. The HDPE will not rust, corrode, rot, delaminate, splinter or swell. It is stiff, easy to fabricate, has excellent scratch resistance, will not delaminate, does not absorb moisture and is UV resistant. The sheets, by CPG International, are available in five colors: Stainless Steel, Nickel, Bronze, Java and Shale, and three textures: Rotary Brushed, Hammered and Orange Peel. Appli-cations include indoor or outdoor cabinetry, furniture, signage and metal and wood replacements..

This column is published in collaboration with Material ConneXion. For more information regarding the material previewed, please contact Michael LaGreca at [email protected]. T: 212.842.2050.

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officenewswirePRODUCT INTROS

>Cortina Leathers added the all-new Vernazza collection and significantly expanded its popular Vespa line. The sun-washed pastels on homes that dot Italy’s Liguria coastline gave inspiration for the Vernazza color palette. In 52 colors, Vernazza’s luxurious hand accompanies its light texture and slightly polished surface. The popular Vespa collection, a distinctive tone-on-tone tipped leather, is available now with 15 fresh, new designer-focused colors added to the line. The Italian countryside’s warm hues reappear as rich accents and sensual neutrals in this updated color palette, all with Vespa’s soft, supple hand. Only European hides, tanned by the finest Italian tanneries, meet Cortina’s exacting speci-fications for Vernazza and Vespa leather. Read More

>HighTower Group intro-duced six new products, including new lounge seating and two table collections. “With every new product launch, HighTower continues our focus on offering unique, well-designed products,

developed to elevate the way people work and learn today, from up-and-coming Interna-tional industrial designers,” said HighTower Founder Scott Hartkopf. “With this product release, we collaborated with designers to bring an interesting mix of materiality and functionality, combined with exquisite details to help bridge the gap between the home and the workplace.”

The Spring product launch includes:

-Chester by Kåre Frandsen, a fun and modern twist on the classic Chesterfield chair. The wood base adds warmth and character, while the wide seat enables range of motion for the user.

-Mama chair, companion to the Papa chair by former Swedish interior architect turned industrial designer Jo-nas Lindvall. Mama and Papa are inspired by the Danish Golden Age and Hemingway’s grandiosity.

-Bello Table Collection by Most Modest includes cof-fee and side tables offering simplicity with unexpected details. Crafted in the U.S., Bello leverages a colorful metal support and a top knife edge detail that provides a soft curve.

-Tombolo Tablet Arm by Most Modest, featuring integrated tablet cradle to keep mobile displays upright and visible and 360-degree swivel to move it out of the way when needed.

-Tombolo Cubby by Most Modest. Tombolo Sectional cubbies, now available as free-standing units, allow design-ers to do even more with the versatile, mid-century modern style of the Tombolo Collection.

-Aeon Rocket by Morten Voss, a series of beautiful, harmonious and striking light pendants. Aeon is said to be the first pendant in history to take full advantage of the luminous qualities of metal and polypropylene in a single design. The gauzy lower shade consists of eight long bands, carefully woven together to create round openings, allowing the light to stream through, unhindered. Read More

>Pablo Designs unveiled a new range of lighting for 2016. In this new collection, Pablo Pardo collaborated with furniture and product designer John August, known for his innovative and technically precise design. These two de-signers, with very different and expressive styles, captured the essence of functional yet sculptural lighting.

-Giraffa Desk Lamp (pictured) is smart and playful, with an expressive purity of form and warm, tactile finishes that give the object a personal feel. A 360° rotating shade combined with an angled post provides multiple lighting pos-

For complete releases, visit www.officeinsight.com/officenewswire.

Cortina Leathers Vernazza and Vespa

HighTower Group L-R Top: Aeon Rocket, Chester. Center: Mama, Bello Table. Bottom: Tombolo Tablet Arm, Tombolo Cubby

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officenewswiresibilities, allowing this petite lamp to cast both direct and ambient light. Giraffa’s warm and fully dimmable LED light source is rated for 50K hours. “Giraffa was born from the playful experimentation of in-tersecting cardboard tubes,” said Mr. August. “Even though the initial explora-tion was about the geometric relationships between these tubes, and the interesting ways the tubes “mitered” together and positioned the light source, a distinct per-sonality began to develop.”

-Vella Collection is a dynamic family of indoor luminaires designed to be completely adjustable via two indepen-dently swiveling louvers, inviting the user to sculpt light and shadow. Vella’s sweeping curved aluminum form subtly captures and releases light from within to wash wall and floor. The lamp employs warm-white LED technology, with full range dimming capabilities.

Both Giraffa and Vella will be showcased at Pablo Design’s booth (1808) at ICFF May 14-17 in NYC. Read More

NOTEWORTHY>Amy Hufford, Student IIDA, is the 2016 IIDA Student of the Year. The Student of the Year award recognizes an IIDA student member whose insight, involvement and leadership have significantly impacted his or her school’s interior design program. Ms. Hufford will be presented with $5,000, courtesy of OFS Brands, and celebrated at the IIDA Annual Meeting on Sunday, Jul. 12, at the Museum of Contemporary Art in Chicago.

“Amy is a talented designer whose passion, drive, and enthusiasm for the industry are clear in her schoolwork, her design portfolio, and her extracurricular activities. Her projects portray innovation and creative execution with an eye toward form, function, and usability,” said IIDA Vice President and CEO Cheryl S. Durst, Hon. FIIDA, LEED AP. “Moreover, Amy brings com-passion to a profession that is ultimately about the health and wellness of the people who inhabit the spaces designers create. I have no doubt Amy will continue to make an impact on the profession.”

A senior in the interior design program at Philadelphia Uni-versity, Ms. Hufford is presi-dent of the University’s IIDA Campus Center. In this role, she has overseen the devel-opment of multiple programs that connect students to the interior design profession. She has been instrumental in organizing the IIDA Product

Showcase, visits to area de-sign firms, various fundrais-ers, and a new mentorship program. Since 2013, she has been selected to repre-sent Philadelphia University’s Interior Design program in several competitions, most recently placing second at the IIDA Design Bowl. Outside of school, she is an interior design intern at Meyer Design Inc., and works as an aide at ManorCare Health Services. Read More

>Fire Farm Lighting’s Belle light was honored with the Eric Engstrom Best of Competition Award in the 20th annual IIDA/HD Product Design Competition. Presented in partnership with Hospitality Design magazine, the competition – open to exhibitors at HD Expo 2016 – honors innovation, function-ality and aesthetic advance-ments in product design for the hospitality industry. Awards were presented in 18 categories. The 2016 jury panel included Susana Covarrubias, IIDA, studio director | design principal,

Gensler; Patricia Rotondo, IIDA, design principal, Chip-man Design Architecture; and Adam Stover, IIDA, NCIDQ, principal | interior architect, POPULOUS. “The products showcased in the IIDA/HD Product Design Competition have once again illustrated how the hospitality industry is pushing the boundaries of in-novation,” said Ms. Covarru-bias on behalf of the jury. “We were particularly impressed with Belle, the Best of Com-petition winner, by Fire Farm Lighting. The craftsmanship, beauty and sheer presence of this lighting product elegantly marries vintage form with modern function.” Read More

>Studio O+A is the recipient of the 2016 National Design Award for Interior Design from Cooper Hewitt, Smith-sonian Design Museum. Now in its 17th year, these awards recognize excellence and innovation across a variety of disciplines in 11 catego-ries. Award recipients will be honored at a gala dinner Oct. 20 at the Arthur Ross Terrace and Garden at Cooper Hewitt. In addition to Studio O+A for Interior Design, this year’s recipients are Moshe Safdie for Lifetime Achievement; Make It Right for Director’s Award; Bruce Mau for Design Mind; Center for Urban Pedagogy for Corporate & Institutional Achievement; Marlon Blackwell Architects for Architecture Design; Geoff McFetridge for Com-munication Design; Opening Ceremony for Fashion Design; Tellart for Interaction Design; Hargreaves Associates for

Pablo Designs GIRAFFA

Amy Hufford IIDA 2016 Student of the Year

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officenewswire

Landscape Architecture; and Ammunition for Product Design.

“The National Design Awards are a vibrant component of Cooper Hewitt’s educa-tion arm through which the museum engages year round with design lovers of all ages across the United States and throughout the world,” said Cooper Hewitt Director Caroline Baumann. “This year’s class of winners reflect design’s remarkable empa-thy for contemporary social concerns: from promoting workplace productivity to pre-serving vernacular traditions to encouraging civic engage-ment. These designers and design firms cross disciplinary boundaries, explore innova-tive materials and develop new models of problem-solv-ing in pursuit of these goals.” Read More

ENVIRONMENT>Student architects from Carnegie Mellon won the top prize of Most Innovative and the People’s Choice Award in the Flux Emerging Architect’s Design Competition. Focused on sustainability in architec-ture, the global design contest was sponsored by Flux, a technology company born out of Google’s Moonshot factory to find ways for technology to prepare the AEC industry for the rapid urbanization and coinciding resource challenges we are facing. “Ecoschool,” the winning project, was inspired by the idea that “out of sight, out of mind” is not a good strat-egy to encourage conscious consumerism of natural resources and energy. In the developed world, people take for granted resources they use on a daily basis, but in a world of diminishing resources, that perception needs to change. What if buildings were con-structed so that basic systems such as water and heating were built on the outside of the buildings? Would we all be more conscious consum-ers if resources were exposed

in a more obvious way? Ecoschool exposed all the basic systems of a housing complex on the outside of the building so that the systems were no longer just functional, but also expressive of the connectivity between people living near each other, and to each individual’s dependence on those resources on a daily basis. Read More

EVENTS>Arborite teamed with the design duo behind LA-based Ouli to create an exhibit for Sight Unseen OFFSITE’s 2016 edition. For this play on a dining set, designer Brooke Intrachat focused on the idea of reinvention, asking the question does progress exist within aesthetics? Us-

Studio O+A 2016 National Design Award in Interior Design from the Cooper Hewitt, Smithsonian Design Museum Yelp offices designed by O + A Photo credit Jasper Sanidad

Carnegie Mellon students win Flux Emerging Architect’s Design Com-petition with Ecoschool

Arborite + Ouli Sight Unseen OFFSITE

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officenewswireing a versatile product like laminate, the Ouli designers created thought-provoking pieces intended to turn design standards on their heads. The exhibit consists of a table, bench, and chair, as well as a sculptural “H” in homage to Guy de Cointet’s preparation stool. The use of laminate as surface “uphol-stery” allows each piece to take on its own character and personality based on the colors and finishes selected. The bench features multi-colored sides, showcasing Arborite’s bolder selection of laminate colors, and a whim-sical curved back reminiscent of Matisse’s “Oasis” cutouts. The minimal chair features a crisp white and wood color palette with a back composed of two rods. The table is also a standout piece, with half the legs featuring a traditional composition and the other two undulating as one piece con-necting across the underside. Arborite President Salvatore Rivera noted, “Laminate is a supremely versatile material,

and Ouli is a boundary-push-ing studio with impressive product design experience. Their creative use of laminate will cast the material in a new light for many viewers. Such a thoughtful commentary on design is the perfect addition to Sight Unseen OFFSITE, a show known for its provoca-tive and enlightening exhibi-tions.”

Sight Unseen OFFSITE is pro-duced and curated annually by Monica Khemsurov and Jill Singer of Sight Unseen to coincide with ICFF and NYCx-DESIGN. It will be held May 13-16 at The Grace Building, 15th floor. Following the exhi-bition, all of the pieces will be on sale through Ouli Studio. Read More

>Ceramics of Italy will again host a multi-brand pavilion at NYC’s Javits Center during ICFF 2016, May 14-17. Sponsored by Confindustria Ceramica (the Italian As-sociation of Ceramics) and the Italian Trade Commission, the Ceramics of Italy pavilion

(booths 1748 + 1660) will display a range of products from 19 premier Italian ceramic companies. Visitors will have a chance to ask questions and gain insight into the industry’s newest advancements in technol-ogy and design. Participating companies include Ascot Ceramiche, Atlas Concorde, Ceramiche Refin, Cerdisa, Cooperativa Ceramica d’Imola, Emilceramica, Fap Ceramiche, Fincibec Group, Florim, Gigacer, Gruppo Beta, Italgraniti – Impronta Cerami-che, Kale Italia, Marca Corona 1741, Mirage, Ornamenta, Settecento Mosaico d’Arte, Simas and Vallelunga & Co., with several representing mul-tiple brands. “With erasable tiles, 2cm outdoor pavers, slim sanitaryware and more on display, Ceramics of Italy will continue to demonstrate its innovative offerings to the design and architecture com-munity,” says Vittorio Borelli, president of Confindustria Ceramica.

This year, Ceramics of Italy will offer a new program for architects and designers: guided tours of the Italian pavilion and an Italian snack on Saturday, Sunday and

Monday (May 14-16) at 1:00 PM. Attendees can register to be entered into a drawing to win a CEU-accredited trip to Italy for Cersaie – the world’s largest exhibition of ceramic tile and bathroom furnishings. Read More

>Designtex is collaborating on an architectural assem-blage with Ecovative Design, Harry Allen and Pfeiffer Lab at Design Pavilion, May 7-11, in celebration of NYCxDESIGN. An immersive urban experience seeking to engage the community and promote the power of design, Design Pavilion will feature sustainable products, includ-ing Designtex fabrics and architectural birch plywood panels from Designtex Sur-face Imaging. Ecovative has created MycoFoam™ and MycoBoard™ interior acous-tic tiles, featuring environ-mentally-friendly fabrics from Designtex. Ecovative’s Cradle to Cradle Gold™ certified Mushroom® Materials meet the function and sustainability needs of the architecture and design community.

Harry Allen’s Weave (pic-tured) features Designtex Array, one of the seven

Ceramics of Italy at ICFF Designtex Design Pavilion

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officenewswireClimatex® collection styles developed in collaboration with William McDonough and based upon his concept of “waste = food.” Array is a biological-nutrient uphol-stery that can break down and return safely to the earth after its useful life, becoming nutrient-giving “food.” Offered in a total of 21 colorways, it is Cradle to Cradle™ Gold Certi-fied. Inspired by Designtex’s sustainable practices as well as Ecovative’s great environ-mental platform, Harry Allen sought to create a completely compostable acoustic tile for Ecovative Interiors. He achieved his goal by pair-ing Array with Ecovative’s MycoFoam, a formaldehyde-free engineered wood. The materials are joined with an equally innovative and envi-ronmentally sound soybased adhesive called Soy Skins, manufactured by e2e.

Eric Pfeiffer for Pfeiffer Lab set out to create a beautiful and useful acoustic tile for Ecovative Interiors. Inspired

by nature, Eric designed Wall Flower, a collection of circular acoustic tiles featuring the Designtex fabric Pigment. Pigment is 100% wool and biodegradable. Each indepen-dent acoustic tile, which can be arranged into countless compositions, is constructed of Ecovative’s MycoBoard, a healthy, sustainable engi-neered wood product that uses mycelium as a natural resin, and covered in Pig-ment. Read More

>Foscarini will host “Real-ity or Illusion?” – a cocktail event at its Spazio Soho showroom on Saturday, May 14, 6:00 p.m. The showroom will showcase new products in addition to an immersive installation by Ferruccio Laviani. Visitors will experi-ence multicolored graphic explosions and extra-large versions of Foscarini’s most well-known lights. In many ways it’s reminiscent of an Ames room that gives off an optical illusion and challenges perspectives. Read More

>IA Interior Architects will showcase services and proj-ects at the Shoptalk Confer-ence in Las Vegas May 15-18. This is the inaugural year of Shoptalk, which is billed as the “tech event for nextgen commerce” and features keynotes from leading CEOs and entrepreneurs, including several IA clients such as Jet.com, Combatant Gentlemen, Raise, and Ulta. With many e-commerce companies looking to develop brick-and-mortar showrooms and workplaces, IA collaborates with its clients to develop programming, brand positioning, concept development, and implemen-tation.

“There have been fundamen-tal shifts in how we live, work, shop, eat, socialize,” said IA Global Project Director of Retail Anthony Simon. “As ar-chitecture and design profes-sionals that cater to creating environments that foster this behavior, we must continue to push our boundaries in our process.”

While at Shoptalk, IA (booth #1219) will engage attendees with live VR demonstra-tions showing multiple retail environments and how IA leverages data in the vir-tual environment. Through a Revit-based platform, visitors can experience the benefits of VR as it applies to the client’s business model; bringing cost, time and “visioning” efficiencies to projects and clients.

“As our clients have inter-acted and responded to the tools of VR, we have seen how useful it is in breaking down barriers in architecture and design, bridging the divide between the concept and the finished project,” said Guy Messick, IA’s director of design intelligence. “We discovered from the first VR demonstration that this tech-nology was not simply a visu-alization tool, but a significant change in how our clients, and their customers, interact with design and place. Simply put: It changes everything.” Read More

Foscarini + NYCx DESIGN

IA Interior Architects at Shoptalk

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officenewswire>IIDA New York Chapter on Monday, May 9 will present Pioneering Design Uptown with BIG: HOT TO COLD. Through the scorching heat of the Arabian Desert to the unforgiving chill of the Finnish tundra, Bjarke Ingels Group Partner Kai-Uwe Bergmann will show how design solu-tions are shaped by their cul-tural and climatic contexts to unlock the immense possibili-ties of adaptive architecture. The central challenge is to mitigate the climatic extremes for hospitable human life, while finding solutions that can be both economically and environmentally profitable. HOT TO COLD is a search for a pragmatic utopia, shaped as the kind of world we wish to inhabit. The event will take place 6:00-9:00 p.m. at MIST Harlem, 46 W 116th Street, NYC. It offers continuing edu-cation credits of 0.1 IDCEC CEU and 1.0 AIA LU. Event Sponsors are Aristeia Metro, Boss Design, Creative Materi-als Corporation, Fullbright Glass Boards, Green Hides Leather Studio, Tom McCar-thy Associates and Sandler Seating. Read More

>Radical Innovation will unveil top new ideas from its 2016 call for entries hosted at the Design Pavilion during NYCxDesign on Saturday, May 14, 2:30-3:30 p.m. The event will highlight the latest trends and concepts for hospitality and introduce some of the talent scouts looking for radically innovative ideas. Speakers will include Edwin Hendriksen, SVP De-velopment and Investments, Citizen M; Jim Woods, presi-dent and COO, The Bowls – Brooklyn Bowl; Matt Turner, editorial director, Sleeper magazine; Larry Spelts, vice president, Business Development, Charlestowne Hotels; Jon Kastl, principal, Champalimaud Design; John Hardy, CEO, The John Hardy Group and founder, Radical Innovation; and Moderator Tara Mastrelli, president, Stu-dio Tano. Taking place at The Cooper Union’s Frederick P. Rose Auditorium, 41 Cooper Square, the event is free and open to the public with RSVP. Read More

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businessRAYMOND JAMES BRIEF 5.2.16BIFMA: March Orders -3%; Shipments +3%

Analysts: Budd Bugatch, Bobby Griffin, David Vargas

>On Friday evening, the Business and Institutional Furni-ture Manufacturers Association (BIFMA) released its market statistics for March 2016. The month’s order and shipment statistics were derived from a sample of 32 companies in the contract office furniture industry, the combined shipments of which account for ~75% of industry volume.

>BIFMA estimates March orders declined 3% year-over-year, down versus the 2% decline reported in February. The prior-year hurdle for March was more difficult relative to February (March 2015 orders increased 12% vs. 7% in February 2015). Thus, the two-year stacked order growth rate for March 2016 was +9%, compared to +5% in February 2016. Recall that BIFMA uses the reported companies’ growth rates (~75% of total industry volume) to estimate the overall U.S. industry vol-ume and growth (orders and shipments). At times, the reported combined growth rates from the U.S. reporting companies (32 total companies) can differ slightly from the overall estimated industry volume. March orders increased ~10% sequentially, versus the 20-year median February to March percentage change of +12%. Trailing 12-month (TTM) orders totaled $10.04 billion, ~0.8% above the prior year. TTM orders are ~32.7% above the February 2010 $7.57 billion trough.

>According to BIFMA, March shipments increased ~3% y/y, versus the 2% increase reported last month. The shipment prior-year comparison for March was easier relative to February (March 2015 shipments increased 7% vs. 10% in February 2015). Consequently, the two-year stacked shipment growth rate for March 2016 was ~10%, compared to ~12% in Febru-ary 2016. TTM shipments totaled $10.29 billion, up 3.4% year-over-year and ~35.0% above the April 2010 trough of $7.62 billion.

>Thoughts on March’s numbers and current industry trends. Admittedly, today’s economic environment is somewhat less certain than it was a year ago, and the year-over-year de-cline in BIFMA order growth rates over the last four months understandably have capital markets participants (ourselves included) concerned about the possibility of a longer-term slow-down. CEO confidence has trended downwards over the last six months, likely contributing to some of the recent industry slowdown. This is not entirely surprising given that office furniture produces no revenue for its buyers, and as a result, is vulnerable as one of the first budgets to be slashed during uncertain economic times. In addition, prior year compari-sons are fairly difficult, as illustrated by this month’s two-year stacked order growth rate of 9% (March 2015 orders increased 12% y/y). Recall, industry orders increased 6.4% through the first half of 2015, versus a 0.7% increase in the second half of 2015. Positively, some of the recent industry commentary and earnings results seem to support (to a degree) the thesis that

5.6.16 4.1.16 12.31.15 10.2.15 6.26.15 3.27.15 %frYrHi%fr50-DayMA

HMiller 30.4 30.4 28.7 29.2 30.5 27.4 -7.1% -0.1%

HNI 43.0 39.6 36.1 43.7 53.2 53.8 -19.9% 5.5%

Inscape 3.0 3.0 3.0 3.0 3.3 3.2 -21.1% -1.1%

Interface 16.6 18.2 19.1 22.5 25.2 20.6 -39.1% -7.0%

Kimball 11.4 11.4 9.8 9.9 11.9 10.2 -11.9% -0.3%

Knoll 23.3 21.9 18.8 21.9 25.9 22.7 -10.5% 5.5%

Leggett 49.1 48.5 42.0 42.1 49.7 45.4 -4.3% 1.7%

Mohawk 195.6 192.4 189.4 189.0 193.2 181.2 -7.8% 1.1%

Steelcase 14.8 14.9 14.9 18.6 19.7 18.9 -27.4% -1.7%

USG 27.0 25.1 24.3 27.4 28.5 25.9 -18.0% 3.7%

Virco 30.4 3.1 3.3 3.1 2.9 2.7 -3.6% 15.4%

SUM 444.5 408.6 389.4 410.3 443.8 412.0

DJIndust 17,741 17,793 17,425 16,472 17,947 17,713 -3.3%

Industry Stock Prices


businessthe entire industry is not “rolling-over,” despite the recent weak order growth rates.

>For all of 2016, BIFMA projects that orders and shipments will increase 3.1% and 1.0%, respectively. Recall, reported orders for 2015 increased 3.5% y/y in 2015, and shipments improved 4.8% y/y. For 2017, BIFMA projects that orders and shipments will increase 4.4% and 4.8%, respectively. Unfor-tunately, many industry participants and observers have been conditioned (by experience) to not put too much weight on the point estimates because the track of the forecasts typically looks significantly higher at the left axis than at the middle or right – at least until we move into the current year. At face value, we now believe BIFMA’s current 2016 order growth projection of ~3.1% seems reasonable given that prior-year comparisons begin to ease in the back half of 2016. April 2015 orders improved 8% y/y, followed by +1% and +3% in May and June, respectively.

>Countering the spate of weak BIFMA reports, Knoll re-cently reported (April 22) 1Q16’s North America office sales increased 10.5% y/y, on top of 14.8% growth in the prior year. The strong y/y sales growth was driven by recent product introductions, including height-adjustable tables and storage products, as well as strength in the company’s core Systems portfolio.

>HNI’s most recent report, however, underscored some of the recent order weakness, but thought that things may turn during the second half of 2016. It reported that its 1Q16 of-fice furniture sales decreased 4.9% y/y to $387.3 million, with declines in both the supplies and contract channels. In addi-tion, management expects revenues to decline again in 2Q16. Encouragingly, though, in the release, CEO Askren cited “signs of modest market improvement.” Recall, HNI’s management had a more bearish outlook over the last few quarters versus its direct office furniture peers.

>Irrespective, regarding ratings, we remain a bit more cau-tious now (only two Outperform-rated stocks in the sector, KNL and HNI) given some of the industry commentary, as well as the remaining tough prior-year comparisons through the first half of 2016. The industry’s choppiness inherently makes sense to us because the contract office furniture industry has become lumpier, and the recent slowdown in the y/y order growth rates, along with sizable differences in prior-year order comparisons, reinforce that characteristic. We understood and always caution that high comparison hurdles are, themselves, a barrier that only time can remedy – particularly in an industry like office furniture.

>So, we are not yet persuaded that the entire office furni-ture market is “rolling over.” And, while the office furniture and general economic environment isn’t robust, it is likely not as bad as some of the current public office furniture compa-nies valuations reflect. Interestingly, a lot of the key industry indicators (more detail below) remain positive, giving us hope that with a reasonable economic environment going forward, we could still be in the middle innings of a non-residential economic recovery. If that’s the case, office furniture demand should slowly improve as we move through 2016. The following comments elaborate and depict some of those positive and/or improving key drivers for office furniture.

>Despite moderating, the pace of job growth remains rela-tively strong by historical standards. Ongoing improvements in employment in 2016 should continue to benefit industry demand. Excluding the energy sector, corporations are still experiencing strong levels of profitability (based on the Bureau of Economic Analysis data), which should also benefit the industry, as long as the macro geopolitical environments do not drastically deteriorate.

>In addition, projected office completions growth in 2016-2017 suggests a long-term positive for office furniture orders and shipments. While the absolute level of office construction spending remains below the 2008 peak, trends continue to improve nicely (based on Census Bureau data). February 2016 (the most recent month available), office construction spend-ing (not seasonally adjusted) improved 22.8% year-over-year and the trailing-12-month office construction spending trend improved 22.3% y/y in February. Trailing 12-month office con-struction spending has been positive since December 2013. The Architects’ Billing Index, which we believe leads non-resi-dential construction by 8-13 months, was 51.9 in March (most recent month available), above 50.0 – the line of demarcation between expansion and contraction. The rolling 12-month aver-age was 51.5 in March, above the 50.0 line of demarcation.

>According to Reis, net office space absorption was positive by ~44 million square feet in 2015 and is forecast to con-tinue to slowly improve going forward (Reis is currently fore-casting ~53 million square feet of net office space absorption in 2016, followed by ~64 million in 2017). Vacancy rates peaked in 1Q11 and have begun to tick lower, but they remain elevated when viewed historically. This should support continued office churn as corporations move and/or consolidate space, taking advantage of favorable lease rates and motivated landlords.


businessBUSINESS AFFAIRS>DIRTT Environmental Solutions Ltd. Reported the voting results from its annual and special meeting of shareholders held on May 5. Shareholders voted and approved the following proposals: (1) the appointment of Deloitte LLP as the audi-tors of the corporation; (2) the election of the directors of the corporation; and (3) the approval of unallocated options under the corporation’s stock option plan. The following directors were elected: Wayne Boulais, Gregory F. Burke, Lawrence D. Fairholm, Scott Jenkins, Christine McGinley, Steve Parry, Diana Propper de Callejon, Mogens Smed, and Denise Turner. http://www.dirtt.net/company/news

>DIRTT Environmental Solutions on May 4 issued its first-quarter 2016 earnings release (Canadian dollars in thousands except per share amounts):

3 Mos. Ended 3.31.16 3.31.15 %Ch.Revenue $55,923 $56,701 -1.4%Gross profit $24,066 $23,801 1.1%SG&A $23,146 $20,071 15.3%Op. Inc. $920 $3,730 -75.3%Net Inc. $368 $4,682 -92.1%Net Inc. $0.25 $0.15 66.7% per share $0.00 $0.06 -100.0%

Highlights reported for the quarter include:

-Significant non-energy revenue growth in the quarter of 27.3%;

-Trailing 12-month revenue was $235.8 million versus $203.5 million in the prior 12-month period, an increase of 15.9%;

-Adjusted gross profit increased by $0.3 million to $24.8 mil-lion, or 1.2%, over Q1 2015;

-Continued and expanded investment in sales, marketing and business development contributed to adjusted SG&A as a percentage of revenue of 34.4%

“In 2015 we could see challenges on the horizon for the energy industry and in response we proactively increased our sales efforts and investments across North America and all industry sectors,” said DIRTT CEO Mogens Smed. “As a direct result, we reported non-energy sector revenue growth of 27.3% over the first quarter of 2015.”

“While we remain focused on diversifying and building our core North American business we were also pleased to see an 83% increase in our international business to $4.2 million in the quarter,” said Scott Jenkins, President. “We have increased our sales and marketing-related team by 14.4% from the prior year and will continue to make further strategic investments to drive growth.”

“Favorable project mix and relatively stable manufacturing vol-ume helped us to generate improved gross profit over the prior year period, in conjunction with a more favorable average U.S.-Canadian exchange rate in this year’s quarter,” said DIRTT CFO Derek Payne. “Alongside better industry fundamentals, we saw stronger sales momentum as we exited the quarter and we expect stronger year-over-year results for the second quarter.”

Last year’s Q1 revenue included $8.1 million from the previ-ously announced US$30.0 million U.S. energy sector contract compared to nil in 1Q16. This business was partially offset by a general increase in activity from small and medium-sized projects in the current year period from a diverse range of industry segments. While total volume decreased quarter over quarter, the stronger U.S. dollar versus the comparable period in 2015 increased the Canadian dollar value of U.S. revenue, largely offsetting the decline in volume. Sales to the energy sector accounted for 9% of total revenue in 1Q16, down from 28% of total revenue in 1Q15. This decline was largely offset by increases in revenue from almost all other sectors. Here is a link to a breakdown of the percentage of revenue by sector for 1Q16 versus 1Q15: http://media3.marketwire.com/docs/RevenuebySector.jpg

Adjusted gross profit for 1Q16 improved slightly to $24.8 mil-lion from $24.5 million for 1Q15, with adjusted gross profit percentage widening 120 basis points to 44.4% from 43.2%. DIRTT attributed this increase to relatively steady manufactur-ing volumes throughout the quarter, combined with a diverse project mix. The higher US dollar to Canadian dollar exchange rate also contributed, as the positive impact on US dollar revenue exceeded the negative impact on US dollar-based production costs.

Adjusted SG&A as a percentage of revenue increased by 370 basis points from 30.7% to 34.4% in the quarter compared with 1Q15. Adjusted SG&A expenses increased by $1.8 million, or 10.4%. DIRTT attributed this increase to its ongoing invest-ment in long-term growth, with marketing-related efforts includ-ing travel, people and promotional build-outs to showcase the company’s capabilities. The higher U.S. dollar to Canadian dollar exchange rate also contributed to the overall increase in adjusted SG&A expenses.

At Mar. 31, DIRTT had $83.5 million in cash and cash equiva-lents compared with $91.4 million at Dec. 31, 2015. At Mar. 31, the company also had access to an undrawn US$18.0 million revolving credit facility. In March, it signed a fourth amendment to the amended and restated loan agreement with its lenders, which among other things, provided an additional capital financing facility of US$10.0 million, which was un-drawn as at Mar. 31.

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businessOutlook

DIRTT’s growth strategy consists of five key initiatives: (1) in-creasing penetration of existing markets by providing continued support and increased investment to existing DPs throughout North America; (2) expanding into new geographies, such as the Middle East and United Kingdom, by capitalizing on recent and continued investment alongside new international DPs; (3) penetrating new vertical markets such as the healthcare, education and residential sectors; (4) continuing to invest in ICE and new innovative interior construction solutions such as the Enzo Approach, residential interiors and timber frame con-struction; and (5) partnering with industry leaders to monetize innovative solutions.

With the recent launch of its residential and timber frame solu-tions, the company has officially entered into these markets. It does not expect to see meaningful revenue from these markets in the near term; however, it did receive its first significant residential contract for 16 duplexes in Alaska.

“We believe DIRTT Solutions are a superior alternative to conventional construction in all sectors of the construction industry, and that a continued increase in construction activity can be expected to result in an ongoing improvement in our revenue,” the company stated in its earnings release. “We plan to invest additional resources, including the further develop-ment of ICE and the development of new DIRTT Solutions and test projects, to pursue further opportunities in healthcare, edu-cation, government and residential sectors of the construction industry.”

A major component of DIRTT’s ongoing marketing activities is DIRTT Connext™, its annual sales, marketing and training initiative which occurs every June in Chicago, coinciding with NeoCon®. Each year DIRTT transforms its company-owned Chicago GLC to showcase its newest innovations and con-struction solutions to the architect and design community, clients, investors and the media. Distribution Partners and DIRTT sales representatives also take part in comprehensive training sessions, hear from DIRTT’s leadership team and key third parties, and network with colleagues – all to strengthen their ability to succeed in their local markets. The total cost for DIRTT Connext in 2015 was $2.3 million. Noting that as the tangible benefits of this yearly event continue to become more evident, the company expects to increase its investment in DIRTT Connext. While these expenses are primarily incurred in Q2, DIRTT Connext’s comprehensive sales and marketing initiatives significantly enhance regular marketing, training and communications efforts throughout the remainder of the year and beyond.

The full text of DIRTT’s 1Q16 earnings release, including all

tables, plus an archived webcast replay of the company’s May 5 conference call, may be accessed at http://ir.dirtt.net. A replay of the call will also be available at +1 416.849.0833 or 1.855.859.2056 (passcode 97283457) until midnight Eastern Time Thursday, May 12. Additional information may be found in DIRTT’s condensed consolidated financial statements avail-able at www.sedar.com and http://ir.dirtt.net/financial-reports.

>Kimball International, Inc. on May 3 released its third-quar-ter fiscal year 2016 results (dollars in thousands except EPS):

3 Mos. Ended 3.31.16 3.31.15 %Ch.Net Sales $150,038 $145,943 2.8%Gross Profit $45,819 $44,007 4.1%SG&A $38,763 $38,508 0.7%Op. Inc. $4,295 $5,111 -16.0%Net Inc. $2,757 $4,882 -43.5%EPS (dil.) $0.07 $0.13 -46.2%

9 Mos. Ended 3.31.16 3.31.15 %Ch.Net Sales $470,426 $441,807 6.5%Gross Profit $150,169 $137,786 9.0%SG&A $120,170 $125,435 -4.2%Op. Inc. $24,038 $8,628 178.6%Inc. from $12.8 $6.9 85.5% Cont. Oper. $14,881 $6,398 132.6%Net Inc. $14,881 $15,555 -4.3%EPS from Cont. Oper. $0.39 $0.17 129.4%EPS (dil.) $0.39 $0.40 -2.5%

Adjusted income from continuing operations for the third quarter of fiscal year 2016 was $4.4 million, or $0.12 per diluted share, which excludes charges related to a previously announced restructuring plan.

“Our third quarter sales were up 3% compared to the prior year third quarter, with several of our verticals showing very strong performance,” said Kimball International Chairman and CEO Bob Schneider. “Specifically, healthcare sales grew 60% and sales into the government vertical increased 19%. However, the hospitality vertical had the usual volatility we often see in this project-based industry with sales being down 22%, while orders received during the quarter were up a strong 49%.

“Our fiscal third quarter is typically slower than other quarters, which tends to put pressure on our sales level and operating margin. However, I am pleased that our third quarter pro forma adjusted operating income as a percent of sales was 4.8%, which was our best fiscal third quarter in a decade. The con-tinuous improvement and restructuring activities the last couple years are getting nice traction. The largest of those activities, the exit and transfer of operations from our Post Falls, ID facility to several facilities in Indiana, is nearing completion but nega-tively impacted results this quarter due to inefficiencies occur-ring during the final move of production between facilities. We

http://ir.dirtt.nethttp://www.sedar.comhttp://ir.dirtt.net/financial-reports


businesscontinue to expect completion of this significant restructuring effort by June 30, 2016. All metal production activities as of the end of March have been transferred and what remains is Post Falls facility clean-up, continued training of Indiana employees and the eventual sale of the Post Falls facility. I sincerely ap-preciate the dedication of our employees as we near the end of this important project.”

Third quarter gross profit as a percent of net sales increased 0.3 of a percentage point over the prior year third quarter, with the improvement attributed to price increases, an overall shift in sales mix to higher margin business, the benefit of lever-age on higher sales, and lower freight costs, partially offset by increased labor and overhead expenses. The increased labor and overhead costs were partially driven by higher employee healthcare expenses during the current year quarter and inef-ficiencies related to the company’s restructuring plan.

Pre-tax restructuring costs in the third quarter of fiscal year 2016 totaled $2.8 million, primarily consisting of employee transition costs and equipment relocation costs related to the cessation of production at the Post Falls, ID facility. Restructuring activities are expected to be completed by Jun. 30, and thereafter only facility maintenance costs will be incurred until sold.

Operating cash flow for the third quarter of fiscal year 2016 was a positive cash flow of $24.5 million compared to a posi-tive cash flow of $10.3 million in the 3Q15. The increase was primarily driven by increased conversion of working capital balances to cash during the current quarter compared to the prior year quarter. The company’s cash and cash equivalents balance was $43.8 million at Mar. 31, compared to June 30, 2015 cash and cash equivalents of $34.7 million. The increase was driven by strong current year cash flows from operations.

Results by End Market Vertical (dollars in millions):

NET SALES

3 Mos. Ended 3.31.16 3.31.15 %Ch.Commercial $50.2 $49.8 0.8%Education $7.6 $7.9 -3.8%Finance $14.0 $13.1 6.9%Government $22.1 $18.6 18.8%Healthcare $23.2 $14.5 60.0%Hospitality $32.9 $42.0 -21.7%Total $150.0 $145.9 2.8%

9 Mos. Ended 3.31.16 3.31.15 %Ch.Commercial $154.0 $151.6 1.6%Education $30.6 $28.5 7.4%Finance $48.4 $42.0 15.2%Government $74.4 $73.1 1.8%Healthcare $58.1 $43.9 32.3%Hospitality $104.9 $102.7 2.1%Total $470.4 $441.8 6.5%

ORDERS

3 Mos. Ended 3.31.16 3.31.15 %Ch.Commercial $48.9 $52.3 -6.5%Education $10.0 $8.2 22.0%Finance $11.1 $13.2 -15.9%Government $22.0 $18.8 17.0%Healthcare $21.9 $15.3 43.1%Hospitality $34.5 $23.1 49.4%Total $148.4 $130.9 13.4%

9 Mos. Ended 3.31.16 3.31.15 %Ch.Commercial $161.4 $160.7 0.4%Education $31.9 $26.5 20.4%Finance $47.7 $42.2 13.0%Government $73.1 $71.1 2.8%Healthcare $62.8 $45.9 36.8%Hospitality $105.6 $105.5 0.1%Total $482.5 $451.9 6.8%

The company noted that its healthcare vertical benefited from strengthening relationships with purchasing organizations and product solutions specific to healthcare settings. The increase in sales to the government vertical market was primarily driven by several federal government projects. The order decline in the hospitality vertical, which is very project-oriented, was at-tributed to shipping more large custom projects last year com-pared to the current year. Office furniture sales within verticals other than the hospitality vertical increased 13% compared to the prior year third quarter.

Sales from new office furniture products introduced in the last three years increased 54% compared to the third quarter of last year. New product sales approximated 25% of total office furniture sales in the current year third quarter compared to 18% in the prior year third quarter.

Office furniture orders received in the current year third quarter within verticals other than the hospitality vertical increased 6% over the prior year.

Guidance

All substantial restructuring activities are expected to be com-plete by Jun. 30, as indicated previously, and are expected to generate savings of approximately $5 million annually thereaf-ter, with approximately $1.25 million benefit occurring quarter-ly. There is no change to the Company’s earnings projection to reach 8% to 9% operating income as a percent of net sales in the quarter ending September 2016. Specifically, the company projects the following for the quarter ending September 2016: net sales to range from $170 million to $180 million; operating income to range from $14 million to $16 million; effective tax rate to range from 35% to 38%; and earnings per diluted share to range from $0.23 to $0.27.


businessThe full text of Kimball’s 3Q16 earnings release, including all tables, and a webcast replay of the company’s May 4 confer-ence call, including a PDF file with supplementary data, may be accessed at www.ir.kimball.com.

>Michael A. Dunlap & Associates, LLC unveiled the results of its quarterly MADA / OFI Trends Survey. This tool measures the current business activity of the commercial furniture indus-try and its suppliers. The current survey was completed during the month of April and marks the 47th Edition. The survey was started during the summer of 2004.

The survey focuses on ten key business activities and respon-dents rate each area on a scale of TEN (the highest) to ONE (the lowest). It then establishes an Industry Index Number to quantify where the industry is currently performing. For exam-ple, an index of 100 means that things “couldn’t be better”, an index of ONE is “absolutely the worst” it can be, and an index of 50 means it is neutral; no change “up” or “down”.

The April Overall Survey Index is 57.24 compared to an almost identical January 2016 Overall Index (57.25) and ex-ceeding October 2015’s (56.05). The 47-survey average for the overall index is 54.79. The highest recorded Index was 59.72 in July 2005 and the lowest was 41.45 in April 2009 during the bottom of the recession.

“The industry continues to grow steadily,” commented Mike Dunlap. “Obviously the smaller to mid-sized companies are growing faster than the Top Five. The Overall Index is strong and is definitely above the 54.79 Survey average. 2015 was the best year we had seen in well over a decade and we remain confident that 2016 will be even better.”

The January 2016 survey highlights are:

-Gross Shipments Index retreated to 57.35 after an all-time record of 64.33 in January and 59.33 in October 2015. The 47-survey average is 57.92. The Order Backlog Index of 58.06 slipped from 59.00 in January, but was higher than the 57.00 Index in October. The 47-survey average is 56.90.

-The Employment Index also retreated to 54.24 from 57.00 in January and 55.33 in October. The 47-survey average is 52.38. The Hours Worked Index of 58.28 rose slightly from 57.50 in January and compares to 58.52 in October. The 47-survey average is 55.61.

-Capital Expenditures rose significantly to 61.25 from 55.33 in January and 55.17 in October. Tooling Expenditures dipped to 57.19 from 57.93 in January, below October’s 58.52. These compare to the 47-survey averages of 55.60 and 55.98.

-New Product Development rebounded to 63.03 from 61.33 in January and 57.93 in October. The 47-survey average is 63.52.

-Raw Material Costs improved again to 53.33, which marks the highest and all-time best index for this category. The January index was 52.33. Four of the past five quarters are all above 50.00 and the 47-survey average is 45.03.

-Employee Costs also improved to 47.81 from January’s 46.55 and October’s 44.00. The 47-survey average is 46.71.

-The Personal Outlook Index is 61.82, up from 61.03 in Janu-ary, but down from October’s 64.67. The all-time high was 66.40 in July 2016. The 47-survey average is 57.99.

Mr. Dunlap further stated, “The fact that we have an all-time high index value for raw materials in the April 2016 survey is very exciting! The high Gross Sales, Employment, and Capital Expenditures are indicators of the current strength of the indus-try. The shifts in Employment Levels and Hours Worked index values are indicative signs that hiring new employees might be keeping up with demand and is still not being offset by less overtime.

“The increase in Capital Expenditures and steady Tooling Ex-penditures are mixed when comparing them to their 47-survey averages, The New Product Development index is still some-what alarming and we will monitor this puzzling trend closely. Both manufacturers and suppliers continue to report similar experiences.

“The improved Raw Material Cost Index has become the norm, because it reflects the decline in the prices of commodities like fuel, steel, copper, and plastics. It’s actually a “deflation” scenario that is typically good only for a short period. Yes, it beats index values in the upper 30’s and lower 40’s. With the five quarter average at 50.95 and 47 quarter average of 45.03, conditions remain out of balance.

“The Employee Cost index value is not unusual and is slightly better than the 47-survey average.

“Although there are signs of softening, I am delighted to see the strength of the Personal Outlook Index. It’s a purely emo-tional question but we put a lot of value on this content.”

“Six out of ten Index values have improved and four have declined, but these are simple corrections in the industry’s performance. Only Employee costs are below the ‘50’ level. We maintain the opinion that the industry will continue to grow steadily during mid 2016 and probably into 2017.”

The most frequently cited perceived threats to the industry’s success are healthcare costs and exchange rates. Healthcare costs are the most commonly cited concern from respondents since this survey process was started in August 2004.

The April 2016 MADA / OFI Trends survey was sent to more than 800 individuals involved with office furniture manufactur-

http://www.ir.kimball.com


businessing and suppliers from Africa, Asia, Australia, Europe, North and South America and from companies ranging from more than $1 billion in sales to less than $10 million in sales. The survey repeats in July 2016. Read More

>Mohawk Industries, Inc. on May 5 announced its first-quar-ter 2016 results (dollars in thousands except EPS):

3 Mos. Ended 4.2.16 4.4.15 %Ch.Net Sales $2,172,046 $1,881,177 15.5%Gross Profit $639,679 $511,943 25.0%SG&A $394,007 $468,169 -15.8%Op. Inc. $245,672 $43,774 461.2%Net Earn. $171,548 $22,346 667.7%EPS (dil.) $2.30 $0.30 666.7%

Excluding restructuring, acquisition and other charges, net earnings were $177 million and EPS was $2.38, a 40% in-crease over last year’s first quarter adjusted EPS of $1.70. On a constant days and currency exchange rate basis, net sales for 1Q16 were up an estimated 19% over 1Q15.

“We entered 2016 with an optimistic outlook, and our results exceeded our projections with revenue growing across all seg-ments,” said Mohawk Industries Chairman and CEO Jeffrey S. Lorberbaum. “We delivered our eighth consecutive quarter with record year over year adjusted EPS, as well as the highest net sales for any quarter in the company’s history. For the period, our adjusted operating income margin rose to a first quarter record of 11.6%, an increase of 200 basis points over the prior year due to acquisitions, volume, productivity and input costs. All of these results were achieved with one less day in the period than last year.

“Our major capital projects initiated last year are progressing as expected, with the first production line in our Tennessee ce-ramic plant now operational, our U.S. LVT production acceler-ating and the second phase of our European ceramic upgrade now complete. Each of our capital expansion projects creates significant long-term value, adding new revenues by increas-ing our product offerings and customer base. Typically, these projects take one to three years to achieve their full benefit. All of these investments should provide higher returns than our ac-quisitions, though start-up costs impact our immediate results.

“In 2016, we have identified more opportunities to grow our business and have already approved additional LVT produc-tion lines in the U.S. and Europe, the doubling of our central Mexicoceramic plant, the final phase of our European ceramic equipment upgrades and the expansion of our U.S. and Euro-pean premium laminate production with new technology. We anticipate investing more than $600 million in capital projects this year, and we are assessing further internal opportunities.

Results by Segment (dollars in thousands):

3 Mos. Ended 4.2.16 4.4.15 %Ch.Global Ceramic Net Sales $773,726 $719,828 7.5% Op. Inc. $99,777 $85,327 16.9%Flooring NA Net Sales $906,364 $846,911 7.0% Op. Inc. $75,351 -$75,192 -Flooring ROW Net Sales $491,956 $314,742 56.3% Op. Inc. $79,537 $44,641 78.2%

“For the quarter, our Global Ceramic Segment sales were up approximately 8% as reported,” said Mr. Lorberbaum. “On a constant days and currency basis, the segment grew 11% with the legacy business up approximately 9%. Adjusted operating income for the segment rose 18% on a constant currency basis over last year to an operating margin of 13%. In our North American ceramic business, which constitutes the

05.09.16 GIVING VOICE TO THOSE WHO CREATE WORKPLACE DESIGN & FURNISHINGS...

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