STATESVILLE, N.C., Feb. 27, 2018 /PRNewswire/ -- Kewaunee
Scientific Corporation (Nasdaq: KEQU) today reported results for
its third quarter of fiscal year 2018, ended January 31,
2018.
Third Quarter Fiscal Year 2018
Results:
- Sales of $38,190,000, an increase
of 25.7% from the prior year third quarter.
- Pre-tax earnings of $2,484,000,
an increase of 406% from the prior year third quarter.
- Net earnings of $883,000, a 159%
increase from the prior year third quarter.
- Diluted earnings per share of $0.31, which includes an unfavorable impact of
$1,113,000, are $0.40 per diluted share, of additional tax
expense recorded in the quarter to account for the implementation
of the Tax Cuts and Jobs Act enacted on December 22, 2017.
Year to Date Fiscal Year 2018 Results
(Q1-Q3):
- Sales of $113,542,000, an
increase of 9.2% from the prior year-to-date period.
- Pre-tax earnings of $7,024,000,
an increase of 42.8% from the prior year-to-date period.
- Net earnings of $3,755,000, or
$1.35 per diluted share, which
includes an unfavorable impact of $1,113,000, or $0.40 per diluted share, of additional tax
expense recorded in the quarter to account for the implementation
of the aforementioned Tax Cuts and Jobs Act.
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Third Quarter Fiscal Year 2018 Commentary
Sales for
the quarter were $38,190,000, an
increase of 25.7% from sales of $30,371,000 in the third quarter of the prior
year. Domestic sales for the quarter were $29,734,000, an increase of 17.5% from sales of
$25,313,000 in the third quarter of
last year. International sales for the quarter were $8,456,000, an increase of 67.2% from sales of
$5,058,000 in the third quarter last
year. Third quarter sales reflected strength in the
laboratory, healthcare, and technical furniture products in the US,
Middle East, Indian and Asian
markets with sales in each of these markets exceeding the prior
period third quarter.
Pre-tax earnings for the quarter were $2,484,000, an increase of 406% compared to
$491,000 in the third quarter last
year. Net earnings for the third quarter were $883,000, or $0.31
per diluted share, which includes an unfavorable impact of
$1,113,000, or $0.40 per diluted share, of additional tax
expense recorded in the quarter to account for the implementation
of the Tax Cuts and Jobs Act enacted on December 22, 2017. Reported net earnings
compares to net earnings of $341,000,
or $0.13 per diluted share, in the
third quarter last year.
"I am extremely pleased with our performance in the third
quarter," said David M. Rausch,
Kewaunee's President and Chief Executive Officer. "Our sales
and pre-tax profit performance for the quarter were very strong in
what is traditionally our weakest quarter. This performance
would have resulted in record quarterly earnings being reported had
it not been for the additional tax expense recorded in the
quarter."
Year to Date Fiscal Year 2018 (Q1-Q3) Commentary
Sales for the nine months ended January 31,
2018 were $113,542,000, an
increase of 9.2% from sales of $103,979,000 in the prior year. Domestic
sales for the nine months ended January 31,
2018 were $80,420,000, a
decrease of 3.3% from sales of $83,161,000 in the prior year.
International sales for the nine months ended January 31, 2018 were $33,122,000, an increase of 59.1% from sales of
$20,818,000 in the prior year.
Similar to the third quarter, sales for the nine months ended
January 31, 2018 reflect continued
strength in the markets for Kewaunee's laboratory, healthcare, and
technical furniture products.
Pre-tax earnings for the nine months ended January 31, 2018 were $7,024,000, an increase of 42.8% compared to
$4,920,000 for the prior
period. Net earnings increased 20.1% for the nine months
ended January 31, 2018 to
$3,755,000, or $1.35 per diluted share, as compared to net
earnings of $3,127,000, or
$1.15 per diluted share, for the nine
months ended January 31, 2017.
This is also after the aforementioned unfavorable impact of
$1,113,000, or $0.40 per diluted share, of additional tax
expense recorded in the quarter.
The Company's order backlog was $116.1
million at January 31, 2018,
as compared to $106.9 million at
January 31, 2017. Incoming
orders continued to be strong in all of our key markets, increasing
the order backlog year-over-year.
The Company's balance sheet and financial condition remain
strong. Unrestricted cash on hand was $9.2
million at the end of the quarter, as compared to
$12.5 million at the beginning of the
fiscal year. Working capital was $36.2
million, as compared to $32.9
million at the beginning of the fiscal year. Short-term debt
and interest rate swaps were $4.8
million at the end of the quarter, as compared to
$3.6 million at the beginning of the
fiscal year, and total bank borrowings and interest rate swaps were
$7.5 million, as compared to
$6.9 million at the beginning of the
fiscal year.
"We continue to be awarded significant projects on a global
basis which is a testament to the Company's world-wide leadership
position and ability to deliver large scale complex projects.
Looking forward, our Associates are focused on delivering a solid
fourth quarter, and I am optimistic that we will have a strong
finish to the current fiscal year," said David M. Rausch, Kewaunee's President and Chief
Executive Officer.
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 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 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,
|
|
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net sales
|
|
|
$
38,190
|
|
$
30,371
|
|
$
113,542
|
|
$ 103,979
|
Cost of products
sold
|
|
29,836
|
|
25,339
|
|
90,456
|
|
84,704
|
Gross
profit
|
|
|
8,354
|
|
5,032
|
|
23,086
|
|
19,275
|
Operating
expenses
|
|
5,971
|
|
4,590
|
|
16,360
|
|
14,484
|
Operating
earnings
|
|
2,383
|
|
442
|
|
6,726
|
|
4,791
|
Other
income
|
|
179
|
|
120
|
|
524
|
|
358
|
Interest
expense
|
|
(78)
|
|
(71)
|
|
(226)
|
|
(229)
|
Earnings before
income taxes
|
|
2,484
|
|
491
|
|
7,024
|
|
4,920
|
Income tax
expense
|
|
1,566
|
|
133
|
|
3,149
|
|
1,695
|
Net
earnings
|
|
|
918
|
|
358
|
|
3,875
|
|
3,225
|
Less: net earnings
attributable to
|
|
|
|
|
|
|
|
|
the noncontrolling interest
|
|
35
|
|
17
|
|
120
|
|
98
|
Net earnings
attributable to
|
|
|
|
|
|
|
|
|
Kewaunee Scientific Corporation
|
|
$
883
|
|
$
341
|
|
$
3,755
|
|
$
3,127
|
|
|
|
|
|
|
|
|
|
|
Net earnings per
share attributable to
|
|
|
|
|
|
|
|
|
Kewaunee Scientific Corporation stockholders
|
|
|
|
|
|
|
|
Basic
|
|
|
$
0.32
|
|
$
0.13
|
|
$
1.38
|
|
$
1.16
|
Diluted
|
|
|
$
0.31
|
|
$
0.13
|
|
$
1.35
|
|
$
1.15
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common
|
|
|
|
|
|
|
|
|
shares
outstanding
|
|
|
|
|
|
|
|
|
Basic
|
|
|
2,722
|
|
2,711
|
|
2,717
|
|
2,703
|
Diluted
|
|
|
2,784
|
|
2,734
|
|
2,772
|
|
2,724
|
Kewaunee
Scientific Corporation
|
Condensed
Consolidated Balance Sheets
|
(in
thousands)
|
|
|
|
|
|
|
January
31,
|
|
April 30,
|
|
|
|
|
|
2018
|
|
2017
|
Assets
|
|
|
|
|
(Unaudited)
|
|
|
Cash and cash
equivalents
|
|
|
|
$
9,178
|
|
$
12,506
|
Restricted
Cash
|
|
|
|
1,493
|
|
1,435
|
Receivables, less
allowances
|
|
|
|
30,843
|
|
29,889
|
Inventories
|
|
|
|
|
17,680
|
|
14,935
|
Prepaid expenses and
other current assets
|
|
|
|
3,083
|
|
1,047
|
Total Current Assets
|
|
|
|
62,277
|
|
59,812
|
Net property, plant
and equipment
|
|
|
|
13,830
|
|
14,027
|
Other
assets
|
|
|
|
|
6,587
|
|
7,077
|
Total
Assets
|
|
|
|
|
$
82,694
|
|
$
80,916
|
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
|
Short-term borrowings
and interest rate swaps
|
|
|
$
4,778
|
|
$
3,591
|
Current portion of
long-term debt
|
|
|
|
1,167
|
|
918
|
Accounts
payable
|
|
|
|
12,631
|
|
11,995
|
Other current
liabilities
|
|
|
|
7,474
|
|
10,423
|
Total Current Liabilities
|
|
|
|
26,050
|
|
26,927
|
Other non-current
liabilities
|
|
|
|
10,551
|
|
10,732
|
Total Liabilities
|
|
|
|
36,601
|
|
37,659
|
Noncontrolling
interest
|
|
|
|
423
|
|
374
|
Kewaunee Scientific
Corporation equity
|
|
|
|
45,670
|
|
42,883
|
Total Equity
|
|
|
|
46,093
|
|
43,257
|
Total Liabilities and
Equity
|
|
|
|
$
82,694
|
|
$
80,916
|
Contact:
|
Thomas D. Hull
III
|
|
(704)
871-3290
|
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SOURCE Kewaunee Scientific Corporation