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Kewaunee Scientific Reports Results for First Quarter

STATESVILLE, N.C., Aug. 27, 2019 /PRNewswire/ -- Kewaunee Scientific Corporation (KEQU) today reported results for its first quarter of fiscal year 2020, ended July 31, 2019.

Kewaunee Scientific Corporation (PRNewsFoto/Kewaunee Scientific Corporation)

Sales for the quarter were $39,336,000, a 6.7% decrease from sales of $42,152,000 in the prior year first quarter. Domestic sales for the quarter were $29,287,000, down 18.8% from sales of $36,070,000 in the first quarter of last year. International sales for the quarter were $10,049,000, up 65.2% from sales of $6,082,000 in the first quarter last year. The decrease in Domestic sales was a result of lower dealer sales in the current quarter versus those in the prior year first quarter. International sales increased as a result of a large order with a new customer and continued strength in the Indian laboratory infrastructure market. 

Pre-tax earnings for the quarter were $665,000 compared to $1,893,000 for the prior year period.  Pre-tax earnings were lower when compared to the prior year period because of lower Domestic sales and higher operating costs and investment in our International segment.  Net earnings for the quarter were $471,000, or $0.17 per diluted share, a decrease of 68.4% as compared to net earnings of $1,489,000, or $0.53 per diluted share, for the quarter ended July 31, 2018.  

The Company's order backlog is $102 million at July 31, 2019, as compared to $101 million at April 30, 2019 and $102 million at July 31, 2018.   

Unrestricted cash on hand was $11.7 million at the end of the quarter, as compared to $9.6 million at the end of the first quarter last year. Working capital was $31.0 million, as compared to $35.6 million at the end of the first quarter last year. Short-term debt and interest rate swaps were $13.3 million at the end of the quarter, as compared to $7.5 million at the end of the first quarter last year, and long-term debt was $127,000 as compared to $972,000 at the end of the first quarter last year. The debt-to-equity ratio at July 31, 2019 was .32-to-1, as compared to .23-to-1 at July 31, 2018.  

"Recognizing the challenging second half of fiscal year 2019, I am pleased with the Company's first quarter sales results for fiscal year 2020 and the progress we are making to return to sustained levels of profitability and cash generation," said Thomas D. Hull III, Kewaunee's President and Chief Executive Officer.


"The Company is recovering from the decline in our Domestic volume during the second half of fiscal year 2019.   We continue to invest in our leadership team and are increasing our capabilities in India to better serve our customers.  We believe the market for laboratory furniture and infrastructure remains healthy, and Kewaunee is positioned well within the market."   


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. The Company's 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 and sales office are located in Shanghai, 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 forwardlooking 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.

Contact:

Donald T. Gardner III 


(704) 871-3274

 

 

Kewaunee Scientific Corporation

Condensed Consolidated Statements of Operations (Unaudited)

($ and shares in thousands, except per share amounts)








Three months ended



July 31,



2019


2018

Net sales


$       39,336


$       42,152

Cost of products sold


32,390


34,569

Gross profit


6,946


7,583

Operating expenses


6,170


5,763

Operating earnings


776


1,820

Other income


56


164

Interest expense, net


(167)


(91)

Earnings before income taxes


665


1,893

Income tax expense


169


395

Net earnings


496


1,498

Less: net earnings attributable to the noncontrolling interest


25


9

Net earnings attributable to Kewaunee Scientific Corporation


$             471


$         1,489






Net earnings per share attributable to





    Kewaunee Scientific Corporation stockholders





       Basic


$0.17


$0.54

       Diluted


$0.17


$0.53






Weighted average number of common shares outstanding





       Basic


2,750


2,736

       Diluted


2,771


2,804






Kewaunee Scientific Corporation

Condensed Consolidated Balance Sheets

($ in thousands)








July 31,


 April 30,



2019


2019

Assets


(Unaudited)



Cash and cash equivalents


$       11,653


$       10,647

Restricted cash


928


509

Receivables, less allowances


36,231


33,259

Inventories


16,351


17,206

Prepaid expenses and other current assets


3,839


3,736

    Total Current Assets


69,002


65,357

Net property, plant and equipment


16,861


16,462

Right of use assets


6,785


-

Other assets


5,893


5,404

Total Assets


$       98,541


$       87,223






Liabilities and Stockholders' Equity





Short-term borrowings and interest rate swaps


$       13,279


$         9,513

Current portion of long-term debt and lease obligations


2,017


1,184

Accounts payable


15,393


15,190

Other current liabilities


7,343


6,846

    Total Current Liabilities


38,032


32,733

Other non-current liabilities


12,572


6,787

    Total Liabilities


50,604


39,520

Kewaunee Scientific Corporation  equity


47,304


47,100

Noncontrolling interest


633


603

    Total Stockholders' Equity


47,937


47,703

Total Liabilities and Stockholders' Equity


$       98,541


$       87,223








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