STATESVILLE, N.C., Aug. 27, 2013 /PRNewswire/ -- Kewaunee Scientific
Corporation (Nasdaq: KEQU) today reported record sales and earnings
for its first quarter ended July 31,
2013.
Net earnings for the quarter were $1,587,000 or $0.61
per diluted share, up from net earnings of $634,000, or $0.25
per diluted share, in the first quarter of the prior year. Sales
for the quarter were $32,003,000, up
19.9% from sales of $26,683,000 in
the first quarter last year. Earnings for the quarter benefited
from higher sales and earnings from both Domestic and International
Operations, as well as the favorable impact of the Company's buyout
of the minority ownership in its principal international
subsidiary.
During the quarter, the Company purchased the 49% minority
ownership of its subsidiary, Kewaunee Labway Asia Pte. Ltd. The
purchase of this additional ownership increased net earnings for
the quarter by $140,000, or
$0.05 per diluted share. Through its
headquarters in Singapore and its
subsidiary in India, Kewaunee
Labway Asia serves as the Company's international center for sales
and installation of laboratory furniture products and fume
hoods.
Domestic Operations sales for the quarter were $27,073,000, up 19.6% from sales of $22,629,000 in the first quarter last year. Sales
benefited from strong order activity from the Company's dealer
network and a strong backlog of orders with customer ship dates
during the quarter. In the domestic markets, increased activity for
mid-size private sector laboratory construction projects more than
offset fewer large projects and continued soft demand for publicly
funded wood projects. The Company continues to increase market
share, although pricing remains very competitive in all of its
market segments.
International Operations sales for the quarter were $4,930,000, up 21.6% from sales of $4,054,000 in the first quarter last year. The
Company continues to see good opportunities in the international
markets, particularly in the growth markets of India, the Middle
East, and Singapore.
The order backlog was $71.1
million at July 31, 2013, as
compared to $80.2 million at
April 30, 2013. The lower order
backlog reflects several factors, including the composition of the
Domestic backlog, which continues to transition to a higher
percentage of orders received through the Company's dealer
organization. These orders typically remain in the backlog for a
shorter duration. The backlog also reflects the manufacturing and
shipment of a large International project during the quarter that
had been in the backlog for an extended period due to construction
project delays. The Company continues to aggressively pursue
laboratory project opportunities, both domestically and
internationally.
The Company balance sheet and financial condition remain strong.
Cash on hand was $5.0 million at the
end of the quarter, as compared to $8.4
million at the end of the first quarter last year. Working
capital was $24.8 million, as
compared to $24.0 million at the end
of the first quarter last year. Borrowings under the Company's
revolving credit facility were $4.9
million at the end of the quarter, as compared to
$6.1 million at the end of the first
quarter last year, and total bank borrowings were $9.8 million, as compared to $9.7 million at the end of the first quarter last
year.
In May 2013, the Company changed
its corporate banking relationship and moved to a larger credit
facility that provides increased limits and flexibility to better
handle the Company's projected future cash needs. The new facility
provides for a 3-year revolving credit facility that allows
outstanding advances of up to $20
million, as compared to the previous limit of $15 million, and new 7-year term debt of
$5 million, which replaced
outstanding term debt of $3.5
million.
"We had an excellent quarter, both domestically and
internationally," said David M.
Rausch, Kewaunee's President and Chief Executive
Officer. "During the quarter, the Company substantially
benefited from the favorable timing of several projects. I
also am extremely pleased with the performance achieved throughout
our organization. In Statesville
where Domestic sales were up nearly 20% over the prior year, our
Metal Plant and Epoxy Resin Plant produced record shipments, while
maintaining high levels of quality and productivity. Our
International Operations also had an excellent quarter with sales
up nearly 22% over the prior year. Despite these much higher
volumes, our Associates continued to do an excellent job in
controlling operating costs.
"Looking forward, the Company expects physical year 2014 to
perform favorably over fiscal year 2013, although typically we
experience variations in results from quarter-to-quarter due to our
customers' construction schedules."
Kewaunee Scientific Corporation is a recognized global leader in
the design, manufacture, and installation of laboratory,
healthcare, and technical furniture products. Laboratory furniture
products include both steel and wood cabinetry, fume hoods,
adaptable modular systems, moveable workstations, biological safety
cabinets, and epoxy resin counters and sinks. Healthcare furniture
products include laminate casework, storage systems, and related
products for healthcare applications. Technical furniture products
include column systems, slotted-post systems, pedestal systems, and
stand-alone benches.
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.
Contact:
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D. Michael
Parker
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|
704/871-3290
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Kewaunee
Scientific Corporation
|
Consolidated
Statements of Operations (Unaudited)
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(in thousands,
except per share data)
|
|
|
|
|
|
|
|
Three months
ended
|
|
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July
31,
|
|
|
2013
|
|
2012
|
Net sales
|
|
$
32,003
|
|
$
26,683
|
Cost of products
sold
|
|
25,427
|
|
21,440
|
Gross
profit
|
|
6,576
|
|
5,243
|
Operating
expenses
|
|
4,144
|
|
4,138
|
Operating
earnings
|
|
2,432
|
|
1,105
|
Other
income
|
|
80
|
|
68
|
Interest
expense
|
|
(88)
|
|
(114)
|
Earnings before
income taxes
|
|
2,424
|
|
1,059
|
Income tax
expense
|
|
807
|
|
371
|
Net
earnings
|
|
1,617
|
|
688
|
Less: net earnings
attributable to the noncontrolling interest
|
|
30
|
|
54
|
Net earnings
attributable to Kewaunee Scientific Corporation
|
|
$
1,587
|
|
$
634
|
|
|
|
|
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Net earnings per
share attributable to
|
|
|
|
|
Kewaunee Scientific Corporation stockholders
|
|
|
|
|
Basic
|
|
$0.61
|
|
$0.25
|
Diluted
|
|
$0.61
|
|
$0.25
|
|
|
|
|
|
Weighted average
number of common shares outstanding
|
|
|
|
|
Basic
|
|
2,596
|
|
2,581
|
Diluted
|
|
2,618
|
|
2,584
|
|
|
|
|
|
|
|
|
|
|
Kewaunee
Scientific Corporation
|
Condensed
Consolidated Balance Sheets
|
(in
thousands)
|
|
|
|
|
|
|
|
July
31,
|
|
April 30,
|
|
|
2013
|
|
2013
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Assets
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(Unaudited)
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|
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Cash and cash
equivalents
|
|
$4,408
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|
$5,811
|
Restricted
Cash
|
|
619
|
|
691
|
Receivables, less
allowances
|
|
24,752
|
|
25,884
|
Inventories
|
|
12,334
|
|
13,203
|
Prepaid expenses and
other current assets
|
|
2,076
|
|
1,641
|
Total Current Assets
|
|
44,189
|
|
47,230
|
Net property, plant
and equipment
|
|
14,995
|
|
15,098
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Other
assets
|
|
6,675
|
|
6,414
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Total
Assets
|
|
$65,859
|
|
$68,742
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
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Short-term borrowings
and interest rate swap
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$5,101
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|
$6,997
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Current portion of
long-term debt
|
|
455
|
|
200
|
Accounts
payable
|
|
8,234
|
|
10,406
|
Other current
liabilities
|
|
5,626
|
|
4,512
|
Total Current Liabilities
|
|
19,416
|
|
22,115
|
Other non-current
liabilities
|
|
15,433
|
|
12,934
|
Total Liabilities
|
|
34,849
|
|
35,049
|
Noncontrolling
interest
|
|
224
|
|
2,017
|
Kewaunee Scientific
Corporation equity
|
|
30,786
|
|
31,676
|
Total Equity
|
|
31,010
|
|
33,693
|
Total Liabilities and
Equity
|
|
$65,859
|
|
$68,742
|
|
|
|
|
|
|
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SOURCE Kewaunee Scientific Corporation