Kewaunee Scientific Reports Results For Year and Fourth Quarter
Exchange: NASDAQ (KEQU)
STATESVILLE, N.C. June 26, 2007 -- Kewaunee Scientific Corporation (Nasdaq:
KEQU - news) today reported results for its fiscal year and fourth quarter ended
April 30, 2007.
Net earnings for the year were $1,540,000, or $0.62 per diluted share, as
compared to net earnings of $193,000, or $0.08 per diluted share, for the prior
year. Excluding an after-tax gain of $540,000 in the prior year related to the
sale of the Company's former Lockhart, Texas property, a net loss of $347,000,
or $0.14 per diluted share, was incurred for that year. Earnings for the current
year benefited from significantly improved manufacturing costs, continuing
success in identifying new global supply sources for raw materials and
components, and other cost improvement initiatives.
Sales for the year were $81,441,000, a decrease of 3.1% from sales of
$84,071,000 in the prior year. Incoming orders, both domestic and international,
were extremely strong in the second half of the year and included several
prestigious laboratory furniture projects. The order backlog climbed to $51.1
million at April 30, 2007, an increase of $14.7 million from $36.4 million at
April 30, 2006.
Sales from domestic operations were $66,585,000, a decrease of 7.6% from the
prior year. However, as reflected in the growth of the Company's order backlog,
the domestic marketplace for laboratory products continues to be healthy,
particularly for larger laboratory projects.
The Company's international operations continued to experience strong sales,
as sales increased 23.3% to $14,856,000. The Asian markets of India, Singapore,
and China continue to be a key in the Company's long-term growth strategy.
During the year, the Company strengthened its sales representation in these
countries and further expanded its manufacturing capabilities in India.
Confirming the Company's excellent reputation in the Asian laboratory
furniture market, during the year the Company was awarded a prestigious contract
to provide and install laboratory furniture and fume hoods for the Olympic
testing laboratory in Beijing, China. This laboratory will test all athletes who
participate in the 2008 Summer Olympics in Beijing and will be one of only a few
laboratories in the world designed to comply with the stringent standards
required for a laboratory to be certified by the International Olympics
Committee. The order will be shipped and installed in the first quarter of
fiscal year 2008.
"We ended fiscal year 2007 with very positive momentum," said William A.
Shumaker, President and Chief Executive Officer. "The strong influx of orders in
the last half of the year provides us a foundation for increased sales in fiscal
year 2008 when the majority of these orders will be shipped. Our lower costs are
making us more competitive in the domestic marketplace, while also improving our
profit margins and profitability. Our international operations continue to grow
in sales and profitability. Excellent progress was also made during the year in
improving our financial position, as we significantly improved cash flow,
reduced borrowings, and strengthened our balance sheet. These factors should
place the Company on a solid track for continued success and profitability."
During the year, the Company generated cash from operations of $8.7 million.
Bank borrowings and capital lease obligations totaled $4.3 million at year-end,
down from $9.1 million at the end of the prior year. The debt-to-equity ratio
declined to .18-to-1 at year-end, and cash on hand increased to $2.6 million, up
from $1.3 million at the end of the prior year. Working capital was $12.3
million at April 30, 2007, up from $11.0 million at the end of the prior year.
Sales for the fourth quarter ended April 30, 2007 were $22,721,000, a
decrease of 4.2% from sales of $23,720,000 in the same quarter of the prior
year. Sales from domestic operations for the quarter were flat from the same
quarter of the prior year, while sales from international operations declined
because especially large shipments were made for several projects in the fourth
quarter of the prior year. Net earnings for the fourth quarter were $517,000, or
$.21 per diluted share, as compared to a net loss of $254,000, or $0.11 per
diluted share, in the prior year.
Kewaunee Scientific Corporation is a recognized leader in the design,
manufacture, and installation of scientific and technical furniture. The
Company's corporate headquarters and domestic manufacturing facilities are
located in Statesville, North Carolina. The Company also has subsidiaries in
Singapore and Bangalore, India that serve the Asian markets. 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: D. Michael Parker
704/871-3290
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three Months Ended Year Ended
April 30 April 30
2007 2006 2007 2006
(Unaudited)
Net sales $22,721 $23,720 $81,441 $84,071
Cost of products sold 18,467 20,629 66,355 71,663
Gross profit 4,254 3,091 15,086 12,408
Other operating income -- -- -- 884*
Operating expenses 3,363 3,223 11,728 12,175
Operating earnings (loss) 891 (132) 3,358 1,117
Other income 20 51 53 50
Interest expense (146) (153) (670) (470)
Earnings (loss) before income taxes 765 (234) 2,741 697
Income tax expense (benefit) 289 (38) 902 288
Earnings (loss) before minority interests 476 (196) 1,839 409
Minority interests in subsidiaries 41 (58) (299) (216)
Net earnings (loss) $517 $(254) $1,540 $193*
Net earnings (loss) per share
Basic $0.21 $(0.11) $0.62 $0.08
Diluted $0.21 $(0.11) $0.62 $0.08
Weighted average number of common
shares outstanding (in thousands)
Basic 2,494 2,492 2,493 2,492
Diluted 2,502 2,492 2,495 2,493
*Includes a non-recurring pretax gain of $884,000 and an after-tax gain of
$540,000, or $.22 per diluted share, on the sale of property.
Condensed Consolidated Balance Sheets
(in thousands)
April 30 April 30
Assets 2007 2006
Cash and cash equivalents $2,231 $929
Restricted cash 372 399
Receivables, less allowances 19,061 23,199
Inventories 5,869 5,860
Prepaid expenses and other current assets 981 1,011
Total current assets 28,514 31,398
Net property, plant and equipment 11,255 11,163
Other assets 5,471 7,911
Total Assets $45,240 $50,472
Liabilities and Stockholders' Equity
Short-term borrowings $3,489 $8,216
Current obligations under capital leases 360 260
Accounts payable 8,437 9,074
Other current liabilities 3,897 2,823
Total current liabilities 16,183 20,373
Other non-current liabilities 5,009 4,553
Total stockholders' equity 24,048 25,546
Total Liabilities and Stockholders' Equity $45,240 $50,472