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Kewaunee Scientific Reports Results for Third Quarter

STATESVILLE, N.C., Feb. 28, 2017 /PRNewswire/ -- Kewaunee Scientific Corporation (KEQU) today reported results for its third quarter of fiscal year 2017, ended January 31, 2017.

Sales for the quarter were $30,371,000, a decrease of 6.3% from sales of $32,410,000 in the prior year. Domestic sales for the quarter were $25,313,000, virtually unchanged compared to sales of $25,423,000 in the third quarter of last year. International sales for the quarter were $5,058,000, down 27.6% from sales of $6,987,000 in the third quarter last year. Sales in the third quarter were impacted by a slowing of near-term orders from our dealer and distribution channels along with two large orders that were not shipped due to construction delays.

Sales for the nine months ended January 31, 2017 were $103,979,000, an increase of 10.0% from sales of $94,536,000 in the prior year.  Domestic sales for the nine months ended January 31, 2017 were $83,161,000, an increase of 9.4% from sales of $76,017,000 in the prior year.  International sales for the nine months ended January 31, 2017 were $20,818,000, an increase of 12.4% from sales of $18,519,000 in the prior year.

Net earnings for the third quarter were $341,000, or $0.13 per diluted share, a decrease of 58.9% as compared to net earnings of $830,000, or $0.31 per diluted share, in the third quarter last year. For the nine months ended January 31, 2017 net earnings increased 26.9% to $3,127,000, or $1.15 per diluted share, as compared to net earnings of $2,465,000, or $0.92 per diluted share, for the nine months ended January 31, 2016.

The Company's order backlog is a new record for Kewaunee at $106.9 million at January 31, 2017, as compared to $95.2 million at January 31, 2016. 

The Company's balance sheet and financial condition remain strong. Unrestricted cash on hand was $8.3 million at the end of the quarter, as compared to $3.7 million at the end of the third quarter last year. Working capital was $31.8 million, as compared to $29.5 million at the end of the third quarter last year. Short-term debt and interest rate swaps were $4.7 million at the end of the quarter, as compared to $5.5 million at the end of the third quarter last year, and total bank borrowings and interest rate swaps were $8.1 million, as compared to $9.4 million at the end of the third quarter last year.

"I am extremely pleased with our order backlog, which is a record for Kewaunee, and a strong foundation for future quarters," said David M. Rausch, Kewaunee's President and Chief Executive Officer. "We were awarded another large $8.4M order in the third quarter with City University of New York, NYCCT New Academic Building. This award as well as the $18.5M contract awarded in the second quarter for the Kuwait University Sabah Al-Salem University City at the College of Science continues to affirm Kewaunee's leadership in the global laboratory furniture and fume hood marketplace."

"Looking forward, our Associates are focused on delivering a solid fourth quarter, and I am optimistic that the results for the current fiscal year will finish strong."

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 is 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,




2017


2016


2017


2016

Net sales



$    30,371


$    32,410


$ 103,979


$    94,536

Cost of products sold


25,339


26,922


84,704


77,673

Gross profit



5,032


5,488


19,275


16,863

Operating expenses


4,590


4,441


14,484


13,163

Operating earnings


442


1,047


4,791


3,700

Other income


120


109


358


296

Interest expense


(71)


(83)


(229)


(236)

Earnings before income taxes


491


1,073


4,920


3,760

Income tax expense


133


225


1,695


1,242

Net earnings



358


848


3,225


2,518

Less: net earnings attributable to









    the noncontrolling interest


17


18


98


53

Net earnings attributable to 









    Kewaunee Scientific Corporation


$         341


$         830


$      3,127


$      2,465











Net earnings per share attributable to









    Kewaunee Scientific Corporation stockholders







       Basic



$        0.13


$        0.31


$        1.16


$        0.93

       Diluted



$        0.13


$        0.31


$        1.15


$        0.92











Weighted average number of common









shares outstanding









       Basic



2,711


2,682


2,703


2,661

       Diluted



2,734


2,699


2,724


2,683

 

 

 


Kewaunee Scientific Corporation


Condensed Consolidated Balance Sheets


(in thousands)














January 31,


April 30,






2017


2016

Assets





(Unaudited)



Cash and cash equivalents




$      8,254


$      5,222

Restricted Cash




1,438


1,567

Receivables, less allowances




25,787


27,835

Inventories





15,731


15,626

Prepaid expenses and other current assets




1,004


707

    Total Current Assets




52,214


50,957

Net property, plant and equipment




14,348


14,118

Other assets





7,083


7,330

Total Assets





$    73,645


$    72,405









Liabilities and Equity







Short-term borrowings and interest rate swaps



$      4,679


$      3,818

Current portion of long-term debt




421


421

Accounts payable




10,105


11,722

Other current liabilities




5,180


4,989

    Total Current Liabilities




20,385


20,950

Other non-current liabilities




12,543


12,903

    Total Liabilities




32,928


33,853

Noncontrolling interest




399


310

Kewaunee Scientific Corporation equity




40,318


38,242

    Total Equity




40,717


38,552

Total Liabilities and Equity




$    73,645


$    72,405

 

 

Contact:         

Thomas D. Hull III


(704) 871-3290

 

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