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Kewaunee Scientific Corporation News

Kewaunee Scientific Reports Third Quarter Results

STATESVILLE, N.C., Feb. 27 PRNewswire-FirstCall — Kewaunee Scientific Corporation (Nasdaq: KEQU) today reported results for its third quarter ended January 31, 2008.

Net earnings for the quarter increased to $802,000, or $0.31 per diluted share, an increase of 150% over $321,000, or $0.13 per diluted share, in the same period last year. Earnings for the quarter again benefited from continued strong performance from the Company's domestic operations, improved profit margins, and continued growth of its international operations.

Sales for the quarter were $21.9 million, an increase of 21% over sales of $18.0 million in the same period last year. Sales from domestic operations increased to $17.7 million, up 20% from the same period last year. Sales from international operations increased to $4.2 million, up 27% from the same period last year.

Net earnings for the nine months ended January 31, 2008 were $2.7 million, or $1.05 per diluted share, an increase of 163% from net earnings for the same period last year of $1.0 million, or $0.41 per diluted share. The gross profit margin for the nine-month period increased to 21.7% from 18.4% in the same period last year. Sales for the nine months ended January 31, 2008 were $67.4 million, an increase of 15% from sales of $58.7 million in the same period last year.

Incoming orders continued to be strong during the quarter. The order backlog increased for the fifth consecutive quarter to a record $58.8 million at January 31, 2008, up from $54.9 million at the end of the previous quarter and $48.6 million at January 31, 2007.

The Company's balance sheet further strengthened during the quarter. Bank borrowings and capital lease obligations declined to $4.2 million at January 31, 2008, down from $7.0 million at January 31, 2007. The debt-to-equity ratio was .16-to-1 at the end of the quarter, down from .27-to-1 at the end of the same period last year. Cash on hand was $2.9 million at the end of the quarter, as compared to $1.9 million at the end of the same period last year. Working capital was $14.7 million at January 31, 2008, up from $11.3 million at the end of the same period last year.

"Our progress continued nicely in the third quarter," said William A. Shumaker, President and Chief Executive Officer. "Our domestic and international operations both contributed to our strong top-line and bottom- line growth. The continued growth in sales, order backlog, and profit margins provides us strong momentum as we go forward, positioning us well for continued growth and profitability."

The Company also announced today that its Board of Directors approved a cash dividend of seven cents per outstanding share to stockholders of record at the close of business on March 10, 2008, payable on March 24, 2008.

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. 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 (unaudited) (in thousands, except per share data) 3 Months Ended 9 Months Ended January 31 January 31 2008 2007 2008 2007 Net sales $21,883 $18,041 $67,394 $58,720 Cost of products sold 17,064 14,417 52,759 47,888 Gross profit 4,819 3,624 14,635 10,832 Operating expenses 3,293 2,829 9,811 8,365 Operating earnings 1,526 795 4,824 2,467 Other income (expense) (6) (11) (2) 33 Interest expense (86) (142) (302) (524) Earnings before income taxes 1,434 642 4,520 1,976 Income tax expense 421 207 1,391 613 Earnings before minority interests 1,013 435 3,129 1,363 Minority interests 211 114 441 340 Net earnings $802 $321 $2,688 $1,023 Net earnings per share Basic $0.32 $0.13 $1.07 $0.41 Diluted $0.31 $0.13 $1.05 $0.41 Weighted average number of common shares outstanding (in thousands) Basic 2,543 2,492 2,523 2,492 Diluted 2,576 2,493 2,551 2,493 Condensed Consolidated Balance Sheets (in thousands) January 31 April 30 2008 2007 Assets (unaudited) Cash and cash equivalents $2,427 $2,231 Restricted cash 455 372 Receivables, less allowances 19,791 19,061 Inventories 6,130 5,869 Prepaid expenses and other current assets 1,222 981 Total current assets 30,025 28,514 Net property, plant and equipment 11,568 11,255 Other assets 5,965 5,471 Total Assets $47,558 $45,240 Liabilities and Stockholders' Equity Short-term borrowings $3,673 $3,489 Current obligations under capital leases 351 360 Accounts payable 7,669 8,437 Other current liabilities 3,661 3,897 Total current liabilities 15,354 16,183 Obligations under capital leases 219 476 Other non-current liabilities 5,130 4,533 Total stockholders' equity 26,855 24,048 Total Liabilities and Stockholders' Equity $47,558 $45,240

SOURCE Kewaunee Scientific Corporation

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