Kewaunee Scientific Reports Results for Third Quarter

Mar 01, 2016, 18:05 ET from Kewaunee Scientific Corporation

STATESVILLE, N.C., March 1, 2016 /PRNewswire/ -- Kewaunee Scientific Corporation (Nasdaq: KEQU) today reported results for its third quarter ended January 31, 2016.

Sales for the quarter were $32,410,000, a 17% increase from sales of $27,754,000 in the prior year. Domestic sales for the quarter were $25,423,000, up 27% from sales of $20,025,000 in the third quarter of last year. International sales for the quarter were $6,987,000, down 10% from sales of $7,729,000 in the third quarter last year.

Net earnings for the quarter were $830,000, or $0.31 per diluted share, as compared to net earnings of $484,000, or $0.18 per diluted share, in the third quarter last year. Sales and earnings for the quarter were higher in comparison to the prior year period as the opportunities within the domestic market were stronger than is typical for our third quarter.  International sales were down on a year-over-year basis due to the timing of a large order shipped during the third quarter of last year that did not repeat. 

The Company's order backlog was $95.2 million at January 31, 2016 as compared to $78.0 million at January 31, 2015, and $92.4 million at October 31, 2015.  Incoming orders for the Domestic business were strong during the quarter due to increased opportunities for laboratory furniture and scientific equipment; however, sales of education related products remained soft as many state and local governments continue to struggle financially.  The International backlog also strengthened as the International team secured a number of new orders across all of our key International markets. 

The Company's balance sheet and financial condition remain strong. Unrestricted cash on hand was $3,709,000 at the end of the quarter, as compared to $3,863,000 at the end of the third quarter last year. Working capital was $29,541,000 as compared to $27,352,000 at the end of the third quarter last year. Short-term debt and interest rate swaps were $5,538,000 at the end of the quarter, as compared to $1,036,000 at the end of the third quarter last year, and long-term debt was $3,455,000 as compared to $3,876,000.

"Historically, the third quarter is often Kewaunee's weakest; however, during the third quarter of fiscal year 2016, we were able to deliver strong year-over-year top line and earnings performance, improved margins, and continued growth of our backlog,"  said David M. Rausch, Kewaunee's President and Chief Executive Officer.  "We are seeing continued strength from the laboratory furniture and casework marketplace as our customers continue to both invest in new facilities and upgrade existing facilities."

"Looking forward, we are focused on exceeding our customers' expectations as we continue to respond to market opportunities globally.  We expect both the domestic and international laboratory casework marketplace will continue to be strong with improved demand for both new construction and renovation projects.  We anticipate a strong fourth quarter in both sales and earnings."

About Kewaunee Scientific Founded in 1906, Kewaunee Scientific Corporation is a recognized global leader in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products. Products include steel, wood, and laminate casework, fume hoods, adaptable modular systems, moveable workstations, stand-alone benches, biological safety cabinets, and epoxy resin worksurfaces and sinks.

The Company's corporate headquarters are located in Statesville, North Carolina. Direct sales offices are located in the United States, India, Singapore, and China. Three manufacturing facilities are located in Statesville serving the domestic and international markets, and one manufacturing facility is located in Bangalore, India serving the local and Asian markets. The Company's China headquarters, sales office, and assembly operation are located in Suzhou Industrial Park, China. Kewaunee Scientific's website is located at http://www.kewaunee.com. `

This press release contains statements that the Company believes to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this press release, including statements regarding the Company's future financial condition, results of operations, business operations and business prospects, are forward-looking statements. Words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "predict," "believe" and similar words, expressions and variations of these words and expressions are intended to identify forward-looking statements. All forward-looking statements are subject to important factors, risks, uncertainties and assumptions, including industry and economic conditions that could cause actual results to differ materially from those described in the forward-looking statements. Additional information concerning these factors is contained in the Company's filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this document. The Company assumes no obligation, and expressly disclaims any obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise.

 

Kewaunee Scientific Corporation

Consolidated Statements of Operations (Unaudited)

(in thousands, except per share data)

Three months ended

Nine months ended

 January 31,

 January 31,

2016

2015

2016

2015

Net sales

$    32,410

$    27,754

$    94,536

$    88,546

Cost of products sold

26,922

23,298

77,673

72,120

Gross profit

5,488

4,456

16,863

16,426

Operating expenses

4,441

3,872

13,163

12,170

Operating earnings

1,047

584

3,700

4,256

Other income

109

134

296

385

Interest expense

(83)

(91)

(236)

(274)

Earnings before income taxes

1,073

627

3,760

4,367

Income tax expense

225

109

1,242

1,361

Net earnings

848

518

2,518

3,006

Less: net earnings attributable to

    the noncontrolling interest

18

34

53

86

Net earnings attributable to 

    Kewaunee Scientific Corporation

$         830

$         484

$      2,465

$      2,920

Net earnings per share attributable to

    Kewaunee Scientific Corporation stockholders

       Basic

$        0.31

$        0.18

$        0.93

$        1.11

       Diluted

$        0.31

$        0.18

$        0.92

$        1.10

Weighted average number of common

shares outstanding

       Basic

2,682

2,628

2,661

2,625

       Diluted

2,699

2,659

2,683

2,656

 

 

Kewaunee Scientific Corporation

Condensed Consolidated Balance Sheets

(in thousands)

January 31,

April 30,

2016

2015

Assets

(Unaudited)

Cash and cash equivalents

$      3,709

$      3,044

Restricted Cash

1,444

2,276

Receivables, less allowances

29,409

29,106

Inventories

16,154

12,745

Prepaid expenses and other current assets

1,705

1,591

    Total Current Assets

52,421

48,762

Net property, plant and equipment

14,381

14,523

Other assets

6,037

6,205

Total Assets

$    72,839

$    69,490

Liabilities and Equity

Short-term borrowings and interest rate swaps

$      5,538

$      4,955

Current portion of long-term debt

421

421

Accounts payable

12,215

11,232

Other current liabilities

4,706

4,447

    Total Current Liabilities

22,880

21,055

Other non-current liabilities

13,167

13,236

    Total Liabilities

36,047

34,291

Noncontrolling interest

282

323

Kewaunee Scientific Corporation equity

36,510

34,876

    Total Equity

36,792

35,199

Total Liabilities and Equity

$    72,839

$    69,490

 

 

Contact: 

Thomas D. Hull III

(704) 871-3290

 

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SOURCE Kewaunee Scientific Corporation



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