Kewaunee Scientific Announces Third Quarter Results and Quarterly Dividend
22 Februar 2006 - 7:03PM
PR Newswire (US)
STATESVILLE, N.C., Feb. 22 /PRNewswire-FirstCall/ -- Kewaunee
Scientific Corporation (NASDAQ:KEQU) today reported results for its
third quarter ended January 31, 2006. Sales for the quarter were
$17,724,000, an increase of 13% over sales of $15,623,000 in the
same period last year. A net loss of $555,000, or $0.22 per diluted
share, was reported for the quarter. This compares to a net loss of
$742,000, or $0.30 per diluted share, in the same period last year.
The order backlog at January 31, 2006 was $35.5 million. This
compares to a backlog of $35.2 million at the beginning of the
quarter and $41.7 million at January 31, 2005. A number of factors
adversely affected earnings for the quarter. An unexpected cost of
$230,000 was incurred when the Company's installation subcontractor
on a large project was unable to complete the installation.
Additionally, energy costs increased 66%, or $205,000, over the
same period last year. The third quarter is traditionally the
Company's weakest quarter for sales and earnings, and these costs
made the quarter even more difficult. As expected, costs and
manufacturing disruptions associated with the completion of three
significant cost improvement projects in the Company's Statesville
plants adversely impacted results for the quarter. A new $1.8
million finishing system was installed in the Wood Plant. This more
efficient system required an entire new layout of the finishing and
assembly areas of the facility. This system is now performing well,
our Associates have been trained, and the Company should benefit
from reduced costs beginning in our fourth quarter. Other projects
completed during the quarter included a new automated folding
machine in the Metal Plant at a cost of $900,000 and new continuous
casting machine in the Resin Plant at a cost of $256,000, both of
which are installed and performing well. The Company's financial
condition remains strong. Cash on hand at the end of the quarter
was $1.3 million and working capital was $11.5 million, while total
debt was $7.1 million. Book value per share was $10.41 at January
31, 2006. "The unexpected costs associated with replacing a
subcontractor and a further significant jump in energy costs made
the third quarter especially difficult," said William A. Shumaker,
President and Chief Executive Officer of Kewaunee. "However, we
believe our fourth quarter will have increased sales and be
profitable. We continue to make progress in reducing our costs for
the long-term. The capital projects in our plants completed during
the quarter will allow us to reduce our operating costs, and we
continue to make good progress in reducing our raw material costs
by finding alternative vendors and more competitive pricing. The
domestic marketplace for our laboratory products continues to be
reasonably healthy, although pricing remains extremely competitive.
Our international subsidiaries in Asia serving the
rapidly-expanding Asian laboratory research market continue to grow
and contribute nicely to our sales and profits." Sales for the nine
months ended January 31, 2006 were $60,351,000, an increase of 11%
over sales of $54,276,000 in the comparable period last year. Net
earnings for the nine months were $447,000, or $0.18 per diluted
share, including a net gain of $540,000, or $0.22 per diluted
share, from the sale of our former Lockhart, Texas property in the
first quarter. A net loss of $441,000, or $0.18 per diluted share,
was reported in the comparable period last year. The Company also
announced today that its Board of Directors approved a cash
dividend of seven cents per outstanding share to stockholders of
record at the close of business on March 6, 2006, payable on March
20, 2006. Kewaunee Scientific Corporation is a recognized leader in
the design, manufacture, and installation of scientific and
technical furniture. The Company's corporate headquarters and
manufacturing facilities are located in Statesville, North
Carolina. The Company also has subsidiaries in Singapore and
Bangalore, India that serve the Asian markets. 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. Consolidated Statements of
Operations (unaudited) (in thousands, except per share data) 3
Months Ended 9 Months Ended January 31 January 31 2006 2005 2006
2005 Net sales $17,724 $15,623 $60,351 $54,276 Cost of products
sold 15,278 13,586 51,034 45,310 Gross profit 2,446 2,307 9,317
8,966 Operating expenses 3,079 3,030 8,952 9,336 Operating earnings
(loss) (633) (993) 365 (370) Other income (expense) 3 (36) 883 4
Interest expense (112) (84) (317) (254) Earnings (loss) before
income taxes (742) (1,113) 931 (620) Income tax expense (benefit)
(268) (382) 326 (227) Earnings (loss) before minority interests
(474) (731) 605 (393) Minority interests 81 11 158 48 Net earnings
(loss) $(555) $(742) $447* $(441) Net earnings (loss) per share
Basic $(0.22) $(0.30) $0.18 $(0.18) Diluted $(0.22) $(0.30) $0.18
$(0.18) Weighted average number of common shares outstanding (in
thousands) Basic 2,492 2,492 2,492 2,491 Diluted 2,494 2,493 2,493
2,495 * Includes a non-recurring after-tax gain on the sale of
property in the amount of $540,000, or $.22 per diluted share.
Condensed Consolidated Balance Sheets (in thousands) January 31
April 30 2006 2005 Assets (unaudited) Cash and cash equivalents
$890 $225 Restricted cash 381 379 Receivables, less allowances
19,103 21,683 Inventories 6,539 3,542 Prepaid expenses and other
current assets 1,338 951 Total current assets 28,251 26,780 Net
property, plant and equipment 11,161 10,730 Other assets 7,602
8,702 Total Assets $47,014 $46,212 Liabilities and Stockholders'
Equity Short-term borrowings $6,244 $3,778 Current portion of
long-term debt 93 931 Current obligations under capital leases 220
111 Accounts payable 6,873 8,558 Other current liabilities 3,310
3,021 Total current liabilities 16,740 16,399 Other non-current
liabilities 4,342 3,824 Total stockholders' equity 25,932 25,989
Total Liabilities and Stockholders' Equity $47,014 $46,212 Contact:
D. Michael Parker 704/871-3290 First Call Analyst: FCMN Contact:
DATASOURCE: Kewaunee Scientific Corporation CONTACT: D. Michael
Parker of Kewaunee Scientific Corporation, +1-704-871-3290 Web
site: http://www.kewaunee.com/
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