Exhibit 99.1
Kewaunee Scientific Reports Results for First Quarter
STATESVILLE, N.C., Aug. 25 /PRNewswire-FirstCall/ -- Kewaunee Scientific
Corporation (Nasdaq: KEQU) today reported results for its first quarter ended
July 31, 2004.
Sales for the quarter were $20,288,000, as compared to sales of
$24,213,000 in the same period last year. Net earnings for the quarter were
$193,000, or $0.08 per diluted share, as compared to net earnings of $461,000,
or $0.19 per diluted share, in the same quarter last year. Net earnings for
the prior year were increased by $189,000, or $.08 per diluted share,
associated with the resolution during the quarter of an old disputed claim for
laboratory furniture.
Sales of laboratory products to industrial research customers slowed
during the quarter, as the number of opportunities in this marketplace
declined and a number of announced projects were delayed. The demand for
technical products in the high-tech marketplace also softened further during
the quarter. The educational marketplace for laboratory products remained
firm. The order backlog at July 31, 2004 was $39.6 million. This compares to
a backlog of $43.1 million at April 30, 2004 and $50.7 million at July 31,
2003.
Earnings for the quarter were unfavorably impacted by the lower sales and
production volumes and significantly higher costs of steel, wood, and other
raw materials, as well as higher energy costs. The impact of these factors
was partially offset by lower manufacturing costs.
"The lower sales volumes, combined with higher costs for raw materials and
energy, resulted in a challenging, as well as disappointing, quarter," said
William A. Shumaker, President and Chief Executive Officer of Kewaunee. "We
are aggressively taking actions to reduce costs until our markets improve.
These include a recent significant workforce reduction in Statesville, tight
controls over spending, and the implementation of a number of strategies to
further reduce our costs.
"We are excited about a number of activities currently underway to
increase sales," Mr. Shumaker continued. "We are pursuing sales opportunities
for our products in several new markets through potential strategic
partnerships with well-established companies. We have also increased our
emphasis on opportunities in the rapidly-growing Asian laboratory research
market."
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. 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.
Condensed Consolidated Statements of Operations [unaudited]
(in thousands, except per share data)
Three Months Ended
July 31
2004 2003
Net sales $20,288 $24,213
Cost of products sold 16,912 20,610
Gross profit 3,376 3,603
Operating expenses 3,046 3,001
Operating earnings 330 602
Interest expense (86) (78)
Other income, net 49 196
Earnings before income taxes 293 720
Income tax expense 100 259
Net earnings $193 $461*
Net earnings per share
Basic $0.08 $0.19
Diluted $0.08 $0.19
Weighted average number of common
shares outstanding (in thousands)
Basic 2,490 2,485
Diluted 2,500 2,489
* Includes an after-tax gain of $189,000, or $.08 per diluted share,
associated with the resolution during the quarter of an old disputed
claim for laboratory furniture.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
July 31 April 30
2004 2004
[unaudited]
Assets
Cash and cash equivalents $1,125 $1,167
Receivables, less allowances 24,444 24,987
Inventories 3,867 4,285
Prepaid expenses and other current assets 1,186 1,097
Total current assets 30,622 31,536
Net property, plant and equipment 11,005 11,362
Other assets 7,370 7,563
Total Assets $48,997 $50,461
Liabilities and Stockholders' Equity
Short-term borrowings $7,987 $6,996
Current portion of long-term debt 1,118 1,118
Accounts payable 5,605 6,924
Other current liabilities 3,019 3,881
Total current liabilities 17,729 18,919
Long-term debt 652 931
Other non-current liabilities 3,809 3,820
Total stockholders' equity 26,807 26,791
Total Liabilities and Stockholders' Equity $48,997 $50,461
Contact: D. Michael Parker
704/871-3290
SOURCE Kewaunee Scientific Corporation
-0- 08/25/2004
/CONTACT: D. Michael Parker of Kewaunee Scientific Corporation,
+1-704-871-3290/
/Web site: http://www.kewaunee.com /
(KEQU)
CO: Kewaunee Scientific Corporation
ST: North Carolina
IN: CPR
SU: ERN