STATESVILLE, N.C., June 21, 2011 /PRNewswire/ -- Kewaunee Scientific
Corporation (Nasdaq: KEQU) today announced results for its year and
fourth quarter ended April 30,
2011.
Sales for the year were $100,003,000, up 1% from sales of $99,093,000 in the prior year. Sales from
domestic operations were $84,121,000,
down 4% from sales of $87,561,000 in
the prior year. Sales from international operations were
$15,882,000, up 38% from sales of
$11,532,000 in the prior year.
Net earnings for the year were $1,850,000, or $0.72 per diluted share, down from net earnings
of $3,572,000, or $1.39 per diluted share, in the prior year.
Earnings for the year were unfavorably impacted by lower selling
prices, delayed projects, and higher costs paid for raw
materials.
The demand for larger domestic laboratory projects continued to
hold up relatively well during the year, as owners moved forward
with projects to take advantage of aggressive pricing. Spending for
small and mid-sized laboratory projects continued to be well below
pre-recession levels and has yet to sustain any noticeable
improvement. The international laboratory furniture marketplace
continued its gradual recovery from the economic slowdown, as the
Company experienced increased sales, earnings, and quotation
activity from the Asian and Middle
East markets.
The order backlog was $65.7
million at April 30, 2011, as
compared to $68.9 million at
April 30, 2010. The order backlog and
dollar value of outstanding quotations remain near record high
levels.
"Despite excellent results from our international operations,
fiscal year 2011 was more difficult than we projected, particularly
the second half of the year," said William
A. Shumaker, President and Chief Executive Officer. "The
improvement in the international marketplace continued, but this
improvement was offset by challenges in the domestic marketplace
including lower selling prices, building construction delays, and
higher costs for raw materials. In the midst of these challenges,
progress continued in a number of areas that are important for our
growth and profitability in fiscal year 2012 and beyond. Our new
product lines of laminate furniture for the healthcare industry and
biological safety cabinets for the laboratory and healthcare
industries continue to be well received in the marketplace, and we
won several important projects that are now shipping. The expansion
of our epoxy resin facility in Statesville was completed in the second
quarter of the year. We are now benefiting from our expanded epoxy
resin product offerings and additional production capacity for
these products.
"We strengthened our domestic and international sales network
during the year. This included the addition of ISEC, one of
the largest interior specialty contractors in the United States, to cover the Rocky Mountain
States Region, and the opening of a new direct sales office in
California. Our international
sales organization was also strengthened with the addition of our
new dealer in Kuwait, Advanced
Technology Company, a full-service sales company for products in
the laboratory and healthcare industries."
The Company's financial condition remains strong. Working
capital increased to $22.1 million at
April 30, 2011, up from $20.1 million at the end of the prior year.
Cash on hand at the end of the year was $3.0 million, as compared to $2.3 million at the end of the prior year. Short
term borrowings under the bank line of credit were $6.6 million, as compared to $4.9 million at the end of the prior year, and
total bank borrowings and capital lease obligations were
$10.6 million, as compared to
$5.1 million at the end of the prior
year. Total bank borrowings increased due to $4 million in long-term financing related to the
Company's expansion of its Statesville operations. The debt-to-equity
ratio was .34-to-1 at year-end, as compared to .17-to-1 at the end
of the prior year.
Sales for the fourth quarter were $26,952,000, up 13% from sales of $23,942,000 in the same period of the prior year.
Sales from domestic operations increased to $21,797,000, up 7% from sales of $20,409,000 in the prior year. Sales from
international operations increased to $5,155,000, up 46% from sales of $3,533,000 in the same period of the prior
year.
Net earnings for the fourth quarter were $252,000, or $0.10
per diluted share, down from net earnings of $528,000, or $0.20
per diluted share, in the prior year period. Earnings for the
quarter were unfavorably impacted by lower selling prices, higher
costs for steel and epoxy resin raw materials, and an unfavorable
product sales mix.
"Looking forward to fiscal year 2012," Mr. Shumaker continued,
"we expect our sales and earnings to be improved over fiscal year
2011, with the second half of the year stronger than the first. Our
outlook is based on a number of factors, including our strong order
backlog, the success of new products, increasing sales
opportunities in our international markets, and the expected
continuing recovery of the economy. Our new products are expected
to contribute noticeably to our sales and profits by the end of the
fiscal year. We continue to see many opportunities for large
projects, both domestically and internationally. Progress has
recently been made in reducing our cost of raw materials, as we
have identified lower cost sources for epoxy resin, the cost of
which increased dramatically during the year due to its oil-based
contents. We also expect steel prices to trend down and return near
to prices at the beginning of last year. In addition, we are
implementing plans to significantly reduce our manufacturing
costs."
Kewaunee Scientific Corporation is a recognized leader in the
design, manufacture, and installation of laboratory, technical and
laminate furniture products. Laboratory furniture products include
both steel and wood cabinetry, fume hoods, adaptable modular
systems, moveable workstations, environmentally friendly casework,
biological safety cabinets and epoxy resin counters and sinks.
Technical furniture products include column systems, slotted-post
systems, pedestal systems and stand-alone benches. Laminate
furniture includes laminate casework, systems and related products
for educational, healthcare and industrial applications.
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.
Consolidated
Statements of Operations
(in
thousands, except per share data)
|
|
|
Three Months
Ended
|
Years
Ended
|
|
|
April
30
|
April
30
|
|
|
2011
|
2010
|
2011
|
2010
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Net sales
|
$26,952
|
$23,942
|
$100,003
|
$99,093
|
|
|
|
|
|
|
|
Cost of products sold
|
22,247
|
19,198
|
80,719
|
77,690
|
|
Gross profit
|
4,705
|
4,744
|
19,284
|
21,403
|
|
Operating expenses
|
4,174
|
3,971
|
16,127
|
15,576
|
|
Operating earnings
|
531
|
773
|
3,157
|
5,827
|
|
Other income
(expense)
|
4
|
1
|
4
|
1
|
|
Interest expense
|
(94)
|
(42)
|
(199)
|
(157)
|
|
|
|
|
|
|
|
Earnings before income
taxes
|
441
|
732
|
2,962
|
5,671
|
|
Income tax expense
|
72
|
248
|
864
|
1,921
|
|
|
|
|
|
|
|
Net earnings
|
369
|
484
|
2,098
|
3,750
|
|
|
|
|
|
|
|
Less: net earnings
attributable to the
|
|
|
|
|
|
noncontrolling interest
|
117
|
(44)
|
248
|
178
|
|
|
|
|
|
|
|
Net earnings attributable
to
|
|
|
|
|
|
Kewaunee Scientific Corporation
|
$252
|
$528
|
$1,850
|
$3,572
|
|
|
|
|
|
|
|
Net earnings per share
attributable to
|
|
|
|
|
|
Kewaunee Scientific Corporation stockholders
|
|
|
|
|
|
Basic
|
$0.10
|
$0.20
|
$0.72
|
$1.39
|
|
Diluted
|
$0.10
|
$0.20
|
$0.72
|
$1.39
|
|
|
|
|
|
|
|
Weighted average number of
common
|
|
|
|
|
|
shares
outstanding (in thousands)
|
|
|
|
|
|
Basic
|
2,578
|
2,572
|
2,575
|
2,564
|
|
Diluted
|
2,593
|
2,584
|
2,585
|
2,575
|
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets
(in
thousands, except per share data)
|
|
|
April
30
|
April
30
|
|
Assets
|
2011
|
2010
|
|
|
|
|
|
Cash and cash
equivalents
|
$2,402
|
$1,722
|
|
Restricted cash
|
553
|
544
|
|
Receivables, less
allowances
|
27,346
|
26,169
|
|
Inventories
|
10,466
|
8,350
|
|
Prepaid expenses and other
current assets
|
1,612
|
1,797
|
|
Total current
assets
|
42,379
|
38,582
|
|
Net property, plant and
equipment
|
16,575
|
13,815
|
|
Other assets
|
4,104
|
4,224
|
|
Total Assets
|
$63,058
|
$56,621
|
|
|
|
|
|
Liabilities
and Stockholders' Equity
|
|
|
|
Short-term borrowings
|
$6,588
|
$4,872
|
|
Current obligations under
capital leases
|
83
|
82
|
|
Current portion of long-term
debt
|
200
|
--
|
|
Accounts payable
|
9,770
|
9,540
|
|
Other current
liabilities
|
3,623
|
4,003
|
|
Total current
liabilities
|
20,264
|
18,497
|
|
Other non-current
liabilities
|
9,778
|
6,452
|
|
Total
liabilities
|
30,042
|
24,949
|
|
Noncontrolling
interest
|
1,525
|
1,239
|
|
Kewaunee Scientific Corporation
equity
|
31,491
|
30,433
|
|
Total equity
|
33,016
|
31,672
|
|
Total Liabilities and
Stockholders' Equity
|
$63,058
|
$56,621
|
|
|
|
|
Contact:
|
D. Michael
Parker
|
|
|
704/871-3290
|
|
|
|
SOURCE Kewaunee Scientific Corporation