Kewaunee Scientific (KEQU) 10-Q 15 Dec 15 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Oct. 31, 2015	Dec. 07, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 31, 2015
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2
Trading Symbol	KEQU
Entity Registrant Name	KEWAUNEE SCIENTIFIC CORP /DE/
Entity Central Index Key	55,529
Current Fiscal Year End Date	--04-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		2,683,713

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014	Oct. 31, 2015	Oct. 31, 2014
Income Statement [Abstract]
Net sales	$ 31,037	$ 30,258	$ 62,126	$ 60,792
Costs of products sold	25,505	24,436	50,751	48,822
Gross profit	5,532	5,822	11,375	11,970
Operating expenses	4,403	3,950	8,722	8,298
Operating earnings	1,129	1,872	2,653	3,672
Other income	85	125	187	251
Interest expense	(61)	(102)	(153)	(183)
Earnings before income taxes	1,153	1,895	2,687	3,740
Income tax expense	446	667	1,017	1,252
Net earnings	707	1,228	1,670	2,488
Less: net earnings attributable to the noncontrolling interest	12	26	35	52
Net earnings attributable to Kewaunee Scientific Corporation	$ 695	$ 1,202	$ 1,635	$ 2,436
Net earnings per share attributable to Kewaunee Scientific Corporation stockholders
Basic	$ 0.26	$ 0.46	$ 0.62	$ 0.93
Diluted	$ 0.26	$ 0.45	$ 0.61	$ 0.92
Weighted average number of common shares outstanding
Basic	2,671	2,626	2,650	2,623
Diluted	2,690	2,659	2,674	2,655

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014	Oct. 31, 2015	Oct. 31, 2014
Statement of Comprehensive Income [Abstract]
Net earnings	$ 707	$ 1,228	$ 1,670	$ 2,488
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(195)	(126)	(214)	(116)
Change in fair value of cash flow hedge	(1)	(11)	11	2
Other comprehensive income (loss)	(196)	(137)	(203)	(114)
Comprehensive income, net of tax	511	1,091	1,467	2,374
Less: comprehensive income attributable to the noncontrolling interest	12	26	35	52
Comprehensive income attributable to Kewaunee Scientific Corporation	$ 499	$ 1,065	$ 1,432	$ 2,322

Consolidated Statement of Stock

Consolidated Statement of Stockholders' Equity - 6 months ended Oct. 31, 2015 - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Balance at Apr. 30, 2015	$ 34,876	$ 6,583	$ 1,841	$ (53)	$ 34,385	$ (7,880)
Net earnings attributable to Kewaunee Scientific Corporation	1,635				1,635
Other comprehensive income (loss)	(203)					(203)
Cash dividends paid, $0.25 per share	(664)				(664)
Stock options exercised, 66,950 shares	458	126	332
Stock based compensation	96		96
Balance at Oct. 31, 2015	$ 36,198	$ 6,709	$ 2,269	$ (53)	$ 35,356	$ (8,083)

Consolidated Statement of Stoc5

Consolidated Statement of Stockholders' Equity (Parenthetical)	6 Months Ended
	Oct. 31, 2015$ / sharesshares
Cash dividends paid, per share | $ / shares	$ 0.25
Stock options exercised, shares	66,950,000
Common Stock [Member]
Stock options exercised, shares	66,950,000
Additional Paid-in Capital [Member]
Stock options exercised, shares	66,950,000
Retained Earnings [Member]
Cash dividends paid, per share | $ / shares	$ 0.25

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Oct. 31, 2015	Apr. 30, 2015
Current Assets:
Cash and cash equivalents	$ 3,274	$ 3,044
Restricted cash	1,679	2,276
Receivables, less allowance; $190; $171, on each respective date	28,572	29,106
Inventories	13,740	12,745
Deferred income taxes	840	856
Prepaid expenses and other current assets	1,302	735
Total Current Assets	49,407	48,762
Property, plant and equipment, at cost	49,352	48,167
Accumulated depreciation	(34,795)	(33,644)
Net Property, Plant and Equipment	14,557	14,523
Deferred income taxes	2,504	2,468
Other	3,730	3,737
Total Other Assets	6,234	6,205
Total Assets	70,198	69,490
Current Liabilities:
Short-term borrowings and interest rate swaps	5,529	4,955
Current portion of long-term debt	421	421
Accounts payable	9,654	11,232
Employee compensation and amounts withheld	2,244	1,882
Deferred revenue	693	216
Other accrued expenses	1,860	2,349
Total Current Liabilities	20,401	21,055
Long-term debt	3,560	3,771
Accrued pension and deferred compensation costs	9,765	9,465
Total Liabilities	$ 33,726	$ 34,291
Commitments and Contingencies
Stockholders' Equity:
Common Stock, $2.50 par value, Authorized - 5,000 shares; Issued - 2,684 shares; 2,633 shares - Outstanding - 2,681 shares; 2,630 shares, on each respective date	$ 6,709	$ 6,583
Additional paid-in-capital	2,269	1,841
Retained earnings	35,356	34,385
Accumulated other comprehensive loss	(8,083)	(7,880)
Common stock in treasury, at cost, 3 shares, on each date	(53)	(53)
Total Kewaunee Scientific Corporation Stockholders' Equity	36,198	34,876
Noncontrolling interest	274	323
Total Equity	36,472	35,199
Total Liabilities and Equity	$ 70,198	$ 69,490

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Oct. 31, 2015	Apr. 30, 2015
Statement of Financial Position [Abstract]
Allowance for receivables	$ 190	$ 171
Common stock, par value	$ 2.50	$ 2.50
Common stock, shares authorized	5,000,000	5,000,000
Common stock, shares issued	2,684,000	2,633,000
Common stock, shares outstanding	2,681,000	2,630,000
Treasury stock, shares	3,000	3,000

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014
Cash flows from operating activities:
Net earnings	$ 1,670	$ 2,488
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	1,227	1,263
Bad debt provision	24	4
Stock based compensation expense	96	108
Provision for deferred income tax expense	(20)	(41)
Change in assets and liabilities:
Decrease (increase) in receivables	510	(605)
Increase in inventories	(995)	(261)
(Decrease) increase in accounts payable and other accrued expenses	(817)	3,931
Increase in deferred revenue	477	101
Other, net	(311)	(226)
Net cash provided by operating activities	1,861	6,762
Cash flows from investing activities:
Capital expenditures	(1,261)	(1,626)
Decrease (increase) in restricted cash	597	(2,501)
Net cash used in investing activities	(664)	(4,127)
Cash flows from financing activities:
Dividends paid	(664)	(603)
Dividends paid to noncontrolling interest in subsidiaries	(75)	(38)
Increase (decrease) in short-term borrowings and interest rate swaps	574	(2,209)
Payments on long-term debt	(211)	(210)
Payment toward purchase of noncontrolling interest in subsidiary	(888)	(888)
Net proceeds from exercise of stock options (including tax benefit)	458	32
Net cash used in financing activities	(806)	(3,916)
Effect of exchange rate changes on cash	(161)	(104)
Increase (decrease) in cash and cash equivalents	230	(1,385)
Cash and cash equivalents, beginning of period	3,044	6,248
Cash and cash equivalents, end of period	$ 3,274	$ 4,863

Financial Information

Financial Information	6 Months Ended
	Oct. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Financial Information	A. Financial Information The unaudited interim consolidated financial statements of Kewaunee Scientific Corporation (the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “Commission”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted, although the Company believes that the disclosures are adequate to make the information presented not misleading. These interim consolidated financial statements include all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of these financial statements and should be read in conjunction with the consolidated financial statements and notes included in the Company’s 2015 Annual Report to Stockholders. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. The consolidated balance sheet as of April 30, 2015 included in this interim period filing has been derived from the audited financial statements at that date, but does not include all of the information and related notes required by generally accepted accounting principles (GAAP) for complete financial statements. The preparation of the interim consolidated financial statements requires management to make certain estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates.

Earnings Per Share

Earnings Per Share	6 Months Ended
	Oct. 31, 2015
Earnings Per Share [Abstract]
Earnings Per Share	B. Earnings Per Share Basic earnings per share is based on the weighted average number of common shares outstanding during the three and six month periods. Diluted earnings per share reflects the assumed exercise and conversion of outstanding options under the Company’s stock option plans, except when options have an anti-dilutive effect. Options to purchase 113,000 shares were not included in the computation of diluted earnings per share for the three and six month periods ended October 31, 2015, because the option exercise prices were greater than the average market price of the common shares at that date, and accordingly, such options would have an antidilutive effect. Options to purchase 70,800 shares were not included in the computation of diluted earnings per share for the three and six month periods ended October 31, 2014, because the effect would be anti-dilutive.

Inventories

Inventories	6 Months Ended
	Oct. 31, 2015
Inventory Disclosure [Abstract]
Inventories	C. Inventories Inventories consisted of the following (in thousands): October 31, 2015 April 30, 2015 Finished products $ 3,082 $ 2,936 Work in process 1,885 1,422 Raw materials 8,773 8,387 $ 13,740 $ 12,745 For interim reporting, LIFO inventories are computed based on year-to-date quantities and interim changes in price levels. Changes in quantities and price levels are reflected in the interim consolidated financial statements in the period in which they occur.

Segment Information

Segment Information	6 Months Ended
	Oct. 31, 2015
Segment Reporting [Abstract]
Segment Information	D. Segment Information The following table provides financial information by business segments for the three and six months ended October 31, 2015 and 2014 (in thousands): Domestic Operations International Operations Corporate Total Three months ended October 31, 2015 Revenues from external customers $ 26,279 $ 4,758 $ — $ 31,037 Intersegment revenues 160 752 (912 ) — Earnings (loss) before income taxes 1,927 535 (1,309 ) 1,153 Three months ended October 31, 2014 Revenues from external customers $ 23,629 $ 6,629 $ — $ 30,258 Intersegment revenues 782 374 (1,156 ) — Earnings (loss) before income taxes 2,059 769 (933 ) 1,895 Domestic Operations International Operations Corporate Total Six months ended October 31, 2015 Revenues from external customers $ 50,594 $ 11,532 $ — $ 62,126 Intersegment revenues 446 1,273 (1,719 ) — Earnings (loss) before income taxes 3,760 1,300 (2,373 ) 2,687 Six months ended October 31, 2014 Revenues from external customers $ 47,877 $ 12,915 $ — $ 60,792 Intersegment revenues 906 906 (1,812 ) — Earnings (loss) before income taxes 4,262 1,473 (1,995 ) 3,740

Defined Benefit Pension Plans

Defined Benefit Pension Plans	6 Months Ended
	Oct. 31, 2015
Compensation and Retirement Disclosure [Abstract]
Defined Benefit Pension Plans	E. Defined Benefit Pension Plans The Company has non-contributory defined benefit pension plans. These plans were amended as of April 30, 2005, no further benefits have been, or will be, earned under the plans, subsequent to the amendment date, and no additional participants will be added to the plans. Contributions of $64,000 were paid to the plans during the six months ended October 31, 2015 and the Company does not expect any contributions to be paid to the plans during the remainder of the fiscal year. The Company did not make any contributions to the plans during the six months ended October 31, 2014. Pension expense consisted of the following (in thousands): Three months ended October 31, 2015 Three months ended October 31, 2014 Service cost $ -0- $ -0- Interest cost 230 225 Expected return on plan assets (344 ) (337 ) Recognition of net loss 294 233 Net periodic pension expense $ 180 $ 121 Six months ended October 31, 2015 Six months ended October 31, 2014 Service cost $ -0- $ -0- Interest cost 460 447 Expected return on plan assets (688 ) (662 ) Recognition of net loss 588 467 Net periodic pension expense $ 360 $ 252

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Oct. 31, 2015
Inventory Disclosure [Abstract]
Summary of Inventories	Inventories consisted of the following (in thousands): October 31, 2015 April 30, 2015 Finished products $ 3,082 $ 2,936 Work in process 1,885 1,422 Raw materials 8,773 8,387 $ 13,740 $ 12,745

Segment Information (Tables)

Segment Information (Tables)	6 Months Ended
	Oct. 31, 2015
Segment Reporting [Abstract]
Segment Information	The following table provides financial information by business segments for the three and six months ended October 31, 2015 and 2014 (in thousands): Domestic Operations International Operations Corporate Total Three months ended October 31, 2015 Revenues from external customers $ 26,279 $ 4,758 $ — $ 31,037 Intersegment revenues 160 752 (912 ) — Earnings (loss) before income taxes 1,927 535 (1,309 ) 1,153 Three months ended October 31, 2014 Revenues from external customers $ 23,629 $ 6,629 $ — $ 30,258 Intersegment revenues 782 374 (1,156 ) — Earnings (loss) before income taxes 2,059 769 (933 ) 1,895 Domestic Operations International Operations Corporate Total Six months ended October 31, 2015 Revenues from external customers $ 50,594 $ 11,532 $ — $ 62,126 Intersegment revenues 446 1,273 (1,719 ) — Earnings (loss) before income taxes 3,760 1,300 (2,373 ) 2,687 Six months ended October 31, 2014 Revenues from external customers $ 47,877 $ 12,915 $ — $ 60,792 Intersegment revenues 906 906 (1,812 ) — Earnings (loss) before income taxes 4,262 1,473 (1,995 ) 3,740

Defined Benefit Pension Plans (

Defined Benefit Pension Plans (Tables)	6 Months Ended
	Oct. 31, 2015
Compensation and Retirement Disclosure [Abstract]
Pension Expenses	Pension expense consisted of the following (in thousands): Three months ended October 31, 2015 Three months ended October 31, 2014 Service cost $ -0- $ -0- Interest cost 230 225 Expected return on plan assets (344 ) (337 ) Recognition of net loss 294 233 Net periodic pension expense $ 180 $ 121 Six months ended October 31, 2015 Six months ended October 31, 2014 Service cost $ -0- $ -0- Interest cost 460 447 Expected return on plan assets (688 ) (662 ) Recognition of net loss 588 467 Net periodic pension expense $ 360 $ 252

Earnings Per Share - Additional

Earnings Per Share - Additional Information (Detail) - shares	3 Months Ended		6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014	Oct. 31, 2015	Oct. 31, 2014
Earnings Per Share [Abstract]
Antidilutive options exclude from computation of earning per share	113,000	70,800	113,000	70,800

Inventories - Summary of Invent

Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands	Oct. 31, 2015	Apr. 30, 2015
Inventory Disclosure [Abstract]
Finished products	$ 3,082	$ 2,936
Work in process	1,885	1,422
Raw materials	8,773	8,387
Total inventories	$ 13,740	$ 12,745

Segment Information - Segment I

Segment Information - Segment Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014	Oct. 31, 2015	Oct. 31, 2014
Segment Reporting Information [Line Items]
Revenues from external customers	$ 31,037	$ 30,258	$ 62,126	$ 60,792
Earnings (loss) before income taxes	1,153	1,895	2,687	3,740
Corporate [Member]
Segment Reporting Information [Line Items]
Intersegment revenues	(912)	(1,156)	(1,719)	(1,812)
Earnings (loss) before income taxes	(1,309)	(933)	(2,373)	(1,995)
Domestic Operations [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenues from external customers	26,279	23,629	50,594	47,877
Intersegment revenues	160	782	446	906
Earnings (loss) before income taxes	1,927	2,059	3,760	4,262
International Operations [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Revenues from external customers	4,758	6,629	11,532	12,915
Intersegment revenues	752	374	1,273	906
Earnings (loss) before income taxes	$ 535	$ 769	$ 1,300	$ 1,473

Defined Benefit Pension Plans -

Defined Benefit Pension Plans - Additional Information (Detail) - USD ($)	6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014
Compensation and Retirement Disclosure [Abstract]
Company expected contributions remainder of fiscal year	$ 0
Contributions made by company	$ 64,000	$ 0

Defined Benefit Pension Plans21

Defined Benefit Pension Plans - Pension Expenses (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 31, 2015	Oct. 31, 2014	Oct. 31, 2015	Oct. 31, 2014
Compensation and Retirement Disclosure [Abstract]
Service cost	$ 0	$ 0	$ 0	$ 0
Interest cost	230	225	460	447
Expected return on plan assets	(344)	(337)	(688)	(662)
Recognition of net loss	294	233	588	467
Net periodic pension expense	$ 180	$ 121	$ 360	$ 252