Kewaunee Scientific Reports Improved Results for Third Quarter

Feb 26, 2013, 17:56 ET from Kewaunee Scientific Corporation

STATESVILLE, N.C., Feb. 26, 2013 /PRNewswire/ -- Kewaunee Scientific Corporation (Nasdaq: KEQU) today reported sales and earnings for its third quarter ended January 31, 2013.

Sales for the quarter were $27,450,000, up 27% from sales of $21,574,000 in the third quarter last year. Net earnings for the quarter were $544,000, or $0.21 per diluted share, as compared to a net loss of $122,000, or $0.05 per diluted share, in the third quarter last year. Earnings for the quarter were favorably impacted by the increase in sales, continued strong results from International operations, and reduced manufacturing, overhead, and administrative costs. The order backlog was $84.5 million at January 31, 2013, up from $77.1 million at January 31, 2012.

Domestic sales for the quarter were $20,445,000, up 19% from sales of $17,142,000 in the third quarter last year. The Company continues to make excellent progress in winning projects through its strengthened dealer network. The marketplace for privately-funded projects continued to hold up relatively well during the quarter, while opportunities for publicly-funded wood educational projects remained well below pre-recession levels, as state and local governments continued to receive significantly lower funding for capital projects.

International sales for the quarter were $7,005,000, up 58% from sales of $4,432,000 in the third quarter last year. The Company has a strong backlog of international orders and continues to see increased opportunities for sales and orders in the growing Asia and Middle East laboratory markets.

Sales for the nine months ended January 31, 2013 were $85,318,000, up 16% over sales of $73,857,000, in the comparable period last year.  Domestic sales were $68,757,000, up 7% over sales of $64,364,000 in the same period last year.  International sales were $16,561,000, up 74% from sales of $9,493,000 in the same period last year. Net earnings for the nine months ended January 31, 2013 were $1,827,000, or $0.71 per diluted share, as compared to a net loss of $225,000, or $0.09 per diluted share, in the comparable period last year.

The Company's balance sheet continues to be strong. Cash on hand was $4.9 million at the end of the quarter, as compared to $4.6 million at January 31, 2012.  Working capital was $24.3 million, as compared to $21.5 million at the end of the same period last year. Short-term borrowings under the Company's $15 million bank line of credit were $2.7 million, as compared to $6.4 million at January 31, 2012. Total bank borrowings and capital lease obligations were $6.2 million, as compared to $10.2 million at the end of the third quarter last year, and the debt-to-equity ratio was .20-to-1, as compared to .34-to-1.

"We continued to make excellent progress during the quarter," said William A. Shumaker, Kewaunee's Chief Executive Officer. "I am pleased with sales and earnings, particularly since the third quarter is historically our slowest due to normal construction cycles and the large number of holidays. We continue to see positive results from our strengthened domestic dealer network and our broadened international dealer network. When combined with our lower manufacturing costs, this is providing us with more opportunities to close orders in both of these geographic markets.

"Looking forward, we expect to have a strong finish to our year. Incoming orders and customer delivery requirements for our metal furniture, fume hoods, and epoxy resin products have provided us a strong backlog of orders scheduled to ship in the fourth quarter. This increased demand and our lower costs are expected to more than offset the continuing lower demand for publicly-funded wood educational projects. It should be mentioned that results for the fourth quarter of last year were unusually strong, as results were favorably impacted by several large international projects that were manufactured and shipped during the quarter."

Kewaunee Scientific Corporation is a recognized leader in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products. Laboratory furniture products include both steel and wood cabinetry, fume hoods, adaptable modular systems, moveable workstations, biological safety cabinets, and epoxy resin counters and sinks. Healthcare furniture products include laminate casework, storage systems, and related products for healthcare applications. Technical furniture products include column systems, slotted-post systems, pedestal systems, and stand-alone benches.

The Company's corporate headquarters are located in Statesville, North Carolina. Three manufacturing facilities are located in Statesville, NC serving the domestic and international markets. One manufacturing facility is located in Bangalore, India serving the local and Asian markets. The Company has subsidiaries in Singapore and India. Kewaunee Scientific's website is located at http://www.kewaunee.com.

Certain statements in this release constitute "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could significantly impact results or achievements expressed or implied by such forward-looking statements. These factors include, but are not limited to, economic, competitive, governmental, and technological factors affecting the Company's operations, markets, products, services, and prices.

 

Kewaunee Scientific Corporation

Consolidated Statements of Operations (Unaudited)

(in thousands, except per share data)

Three months ended

Nine months ended

 January 31,

 January 31,

2013

2012

2013

2012

Net sales

$    27,450

$    21,574

$    85,318

$    73,857

Cost of products sold

22,441

17,803

69,839

62,053

Gross profit

5,009

3,771

15,479

11,804

Operating expenses

4,054

3,990

12,205

11,950

Operating earnings (loss)

955

(219)

3,274

(146)

Other income

84

193

260

228

Interest expense

(80)

(110)

(295)

(333)

Earnings (loss) before income taxes

959

(136)

3,239

(251)

Income tax expense (benefit)

177

(170)

962

(237)

Net earnings (loss)

782

34

2,277

(14)

Less: net earnings attributable to

    the noncontrolling interest

238

156

450

211

Net earnings (loss) attributable to 

    Kewaunee Scientific Corporation

$         544

$        (122)

$      1,827

$        (225)

Net earnings (loss) per share attributable to

    Kewaunee Scientific Corporation stockholders

       Basic

$        0.21

$       (0.05)

$        0.71

$       (0.09)

       Diluted

$        0.21

$       (0.05)

$        0.71

$       (0.09)

Weighted average number of common

  shares outstanding

       Basic

2,590

2,579

2,586

2,579

       Diluted

2,604

2,579

2,596

2,579

 

Kewaunee Scientific Corporation

Condensed Consolidated Balance Sheets

(in thousands)

January 31,

April 30,

2013

2012

Assets

(Unaudited)

Cash and cash equivalents

$      4,202

$      6,188

Restricted Cash

692

704

Receivables, less allowances

20,064

23,244

Inventories

12,888

11,760

Prepaid expenses and other current assets

2,269

1,702

    Total Current Assets

40,115

43,598

Net property, plant and equipment

14,890

15,346

Other assets

5,618

5,192

Total Assets

$    60,623

$    64,136

Liabilities and Equity

Short-term borrowings

$      2,707

$      6,816

Current obligations under capital leases and long-term debt

200

236

Accounts payable

8,562

8,848

Other current liabilities

4,360

4,340

    Total Current Liabilities

15,829

20,240

Other non-current liabilities

12,095

12,238

    Total Liabilities

27,924

32,478

Noncontrolling interest

1,845

2,147

Kewaunee Scientific Corporation equity

30,854

29,511

    Total Equity

32,699

31,658

Total Liabilities and Equity

$    60,623

$    64,136

 

Contact:

D. Michael Parker

704/871-3290

 

SOURCE Kewaunee Scientific Corporation



RELATED LINKS

http://www.kewaunee.com