Kewaunee Scientific Corporation (NASDAQ:KEQU)

Kewaunee Scientific (NASDAQ:KEQU) ($35.42; $101.8M market cap) announced it will terminate its pension plan effective April 30, 2024. 

“The company transferred approximately $17.7 million of pension obligations through the purchase of group annuity contracts for all remaining liabilities under the pension plan. In connection with the transfer, the Company has contributed approximately $0.3 million in cash to the pension plan, which was intended to fully fund the Company’s remaining defined benefit pension liabilities. The pension benefits to which plan participants and their beneficiaries are entitled will not change as a result of the transaction. Plan participants separately will receive additional information regarding the foregoing.”

KEQU is a recognized leader in the design, manufacture, and installation of scientific and technical furniture.

Reported Q3 2024 results:

• Sales of $46.7 million vs $60.8 million in the prior year
• EPS of $0.85 vs $0.25 in the prior year

"Our financial performance for the third quarter of fiscal year 2024 was strong," said Thomas D. Hull III, Kewaunee's President and Chief Executive Officer. "As discussed in previous quarterly releases, we are realizing the benefits of executing on our strategic objectives."

"While the third quarter can often be our softest quarter due to the holiday schedule in the US as well as customers looking to wrap up construction projects before the calendar-end, we did not experience a significant slow-down in activity during the quarter. This is a testament to our world-class dealer and distribution network who continue to perform at a high level in response to customer demand."

"Looking ahead, we remain optimistic about the future, with a strong pipeline of projects, a sound strategy, and a commitment to sustained financial performance."

Kewaunee Scientific (NASDAQ:KEQU)  - Stock back on our radar due to strong results and backlog. On June 29, 2022 the company reported strong Q4 2022 results:

• Sales of $49.7 million vs $38.7 million in the prior year

• Non-GAAP EPS of $0.78 vs a loss of $1.08 in the prior year

• Backlog of $173.9 million, up from 138.1 in January 2022 and up from $114.5 last year

"Kewaunee has posted a record high backlog for the third time in the past four quarters, demonstrating the confidence customers have in our ability to meet their requirements in a dynamic operating environment. Domestically, our order backlog increase has been driven by strength in the life science and higher education end-use markets within the United States. Our international teams continue to see customers investing in large infrastructure projects requiring laboratories in India, the Middle East, and Africa and were awarded multiple, multi-year projects during the year. The strength in our backlog positions the Company well for the next fiscal year as the majority of these orders will deliver over the next twelve to eighteen months."

KEQU ($23.32)announced Q4 2017 results:

• Sales of $34.5 million vs $34.1 million in the prior year

• EPS of $0.51 vs $0.50 in the prior year

Quotes from management:

"Fiscal year 2017 was another year of continued growth for Kewaunee as we achieved record sales and net earnings," said David M. Rausch.  "The Kewaunee Associates continue to focus on delivering world-class products to our customers, and our success is a testament to their dedication.  The Company finished the year with another strong backlog and continues to focus on productivity and efficiency projects that I believe will continue to enhance the Company's long-term success.  

Coming off three strong years, I continue to be optimistic about Kewaunee's future and anticipate continued sales and earnings growth in fiscal year 2018. The pace of activity, both domestically and internationally, remains solid as customers continue to invest in projects that require the products and services that we provide."

KEQU ($24.60) - We initiated a long position in KEQU after strong Q1 2017 results in late August.  See our original note here. KEQU designs, manufactures, and installs laboratory, health care, and technical furniture products.

Yesterday after the close, KEQU reported Q2 2017 results:

• Sales of $36.3 million vs $31.0 in the prior year

• EPS of $0.54 vs $0.26 in the prior year

• Backlog of $101.0 million vs $$92.4 million in the prior year

Comments from management:

“The growth in Domestic sales was a result of continued strength of incoming orders across our distribution channels as the marketplace for laboratory furniture and scientific equipment in the United States continued to improve.  International sales were strong as we finished deliveries on multi-year laboratory projects in India and Kuwait...

Looking forward, our third quarter is always our most challenging due to the holidays as well as customers managing their year-end inventory; however, I am optimistic that the results for the current fiscal year will be strong as we continue to see new opportunities worldwide."

STATESVILLE, N.C., Sept. 19, 2016 /PRNewswire/ -- Kewaunee Scientific Corporation (NASDAQ: KEQU) today announced that, through its dealer ATC, it has been awarded a contract valued at approximately $18.5 million for the new College of Science complex for Kuwait University's Sabah Al-Salem University City. This is the second College at the new Sabah Al-Salem University City for which Kewaunee will be supplying Laboratory furniture, fume hoods, and related products. We are nearing completion of our contract for providing similar products for the College of Engineering and Petroleum complex.

"We are delighted and very proud to have been selected to continue working with Kuwait University, Turner Projacs JV, MCC, and the entire construction team on this world-class complex for higher education," said David M. Rausch, Kewaunee Scientific's President and Chief Executive Officer. "Being selected to continue to provide the highest quality products and services to Kuwait University's Sabah Al-Salem University City at the College of Science complex is further indication of our commitment to theMiddle East and a reflection of our industry leading reputation and the ability of our experienced international team in servicing the important Middle East market."

KEQU ($22.42) reported Q1 2017results:

• Sales of $37.3 million vs $31.1 million

• EPS of $0.48 vs $0.35 in the prior year

Comments from management:

"We had a very strong first quarter with our Domestic and International businesses posting strong year-over-year sales growth," said David M. Rausch, Kewaunee's President and Chief Executive Officer. "We have grown our sales and net earnings, continuing to operate at high levels and benefiting from ongoing productivity improvements and cost reduction programs.

Looking forward, I remain optimistic that sales will continue to increase in fiscal year 2017. I expect our earnings improvement to be sustainable as our order backlog and opportunities in the market remain strong."

KEQU ($16.94) - Reported Q4 2016 results:

• Sales of $34.1 million vs $30.3 million in the prior year

• EPS of $0.50 vs $0.23 in the prior year

Quotes from management:

"The fourth quarter was our strongest quarter of fiscal year 2016 as we continue to benefit from increased project activity across all of our key markets…

...Fiscal Year 2016 was a strong year for Kewaunee as we delivered record sales and improved profitability," said David M. Rausch.  "I am extremely proud of the Kewaunee Associates across the globe who continue to strive to meet the needs and growing expectations of our customers.  I am also encouraged by the continued strength of our order backlog and the opportunities we are winning globally.

Looking forward, I am optimistic we will continue to experience sales and earnings growth in fiscal year 2017. Bookings continue to be strong, and our order backlog is at record levels.  The pace of activity domestically and internationally is stronger than in previous years as customers continue to invest in projects that require new laboratory furniture and fume hoods."

Third quarter 2013 Financial Results

• Sales for the quarter were $26,013,000, a decline of 5% from sales of $27,450,000 in the third quarter last year.
• Net earnings for the quarter were $604,000, or $0.22 per diluted share, as compared to net earnings of $544,000, or $0.21 per diluted share, in the third quarter last year.

"We continued to make excellent progress during the quarter," said David M. Rausch, Kewaunee's Chief Executive Officer. "I am pleased with sales and earnings, particularly since the third quarter is historically our slowest due to normal construction cycles and the large number of holidays. Also, we continued to make good progress in the quarter against our goals to strengthen the Kewaunee brand, strengthen relationships with existing customers, build relationships with new and prospective customers, reduce costs, and increase market share.

"Our Associates in Statesville did an excellent job controlling manufacturing and operating costs during the quarter. These lower costs are allowing us to continue to be very competitive in the domestic marketplace where fewer new projects available have intensified pressure on project selling prices. Our international team also made excellent progress during the quarter in winning projects, expanding and strengthening the Kewaunee sales organization, and strengthening the Kewaunee brand name globally.

"Looking forward, we expect that the financial results for the fourth quarter will likely be in line with, or slightly better than, the past two quarters."

Second Quarter 2014 Results

• Sales for the quarter were $26,098,000, as compared to sales of $31,185,000 in the second quarter last year.
• Net earnings for the quarter were $725,000, or $0.28 per diluted share, as compared to net earnings of $649,000, or $0.25 per diluted share, in the second quarter last year.
• The order backlog was $69.5 million at October 31, 2013, as compared to $71.1 million at July 31, 2013.

"We had a good quarter, both internationally and domestically," said David M. Rausch, Kewaunee's Chief Executive Officer. "Although sales and earnings were below the pace of the past several quarters, a good portion of the sales decline was related to our strategy to improve product mix and margins. We also continue to make excellent progress in strengthening our relationships with laboratory planners and architects. Through this process we are gaining a better understanding of their needs and desired products, which increases their preference for the Kewaunee brand.

"Looking forward to the second half of our fiscal year, we expect the domestic marketplace will continue to be challenging due to the uncertainty in the economy and the resulting softening in demand for our products. We continue to pursue new sales opportunities, domestically and internationally, and maintain our focus on cost savings initiatives throughout the organization. It should be pointed out that our third quarter is normally the slowest due to construction cycles and the large number of holidays. The comparable third quarter of last year was an exception to this norm, as several large international projects shipped during that quarter."

First Quarter 2014 Financial Results

• Sales for the quarter were $32,003,000, up 19.9% from sales of $26,683,000 in the first quarter last year.
• Net earnings for the quarter were $1,587,000 or $0.61 per diluted share, up from net earnings of $634,000, or $0.25 per diluted share, in the first quarter of the prior year.
• The order backlog was $71.1 million at July 31, 2013, as compared to $80.2 million at April 30, 2013. The lower order backlog reflects several factors, including the composition of the Domestic backlog, which continues to transition to a higher percentage of orders received through the Company's dealer organization.

"We had an excellent quarter, both domestically and internationally," said David M. Rausch, Kewaunee's President and Chief Executive Officer. "During the quarter, the Company substantially benefited from the favorable timing of several projects. I also am extremely pleased with the performance achieved throughout our organization. In Statesville where Domestic sales were up nearly 20% over the prior year, our Metal Plant and Epoxy Resin Plant produced record shipments, while maintaining high levels of quality and productivity. Our International Operations also had an excellent quarter with sales up nearly 22% over the prior year. Despite these much higher volumes, our Associates continued to do an excellent job in controlling operating costs.

"Looking forward, the Company expects physical year 2014 to perform favorably over fiscal year 2013, although typically we experience variations in results from quarter-to-quarter due to our customers' construction schedules."

STATESVILLE, N.C., July 8, 2013 /PRNewswire/ -- Kewaunee Scientific Corporation (NASDAQ: KEQU), a recognized global leader in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products, today announced that it had acquired all of the outstanding minority shares of its subsidiary in Singapore, Kewaunee Labway Asia Pte. Ltd. 

Through its headquarters in Singapore and its subsidiary in India, Kewaunee Labway Asia serves as the Company's international center for sales and installation of laboratory furniture products and fume hoods. Kewaunee Labway Asia had consolidated sales ofapproximately $17 million in its most recent fiscal year.  The transaction is expected to be accretive to earnings beginning in the current fiscal year.

Kewaunee Labway Asia was formed in Singapore in 1998 under a partnership agreement between the Company and Labway Scientific Co. Pte. Ltd. to sell and distribute the Company's laboratory furniture products and fume hoods into the fast growing laboratory research market in Singapore. Kewaunee Labway Asia quickly became the recognized leader for these products inSingapore, and in 2000, its sales organization expanded into India with the formation of Kewaunee Labway India Pvt. Ltd. to serve the expanding India laboratory research market. To support the growing sales in India and surrounding markets, in 2002 Kewaunee Scientific Corporation opened an assembly operation in Bangalore, India, which was replaced in 2009 with a state-of-the-art facility with full manufacturing capabilities. Today, through the combined efforts of Kewaunee Scientific Corporation and its subsidiaries, the Company has grown to be a recognized global leader in the design, manufacture, and installation of laboratory products in the international markets of India, Singapore, China, Thailand, Malaysia, Philippines, Taiwan, Indonesia, Saudi Arabia, Kuwait, UAE, Qatarand other regional countries.

"The purchase of the minority shares provides us a sound foundation for further international growth," said David M. Rausch, President and Chief Executive Officer. "This is an indication of our continuing commitment to capitalize on opportunities in the global marketplace, particularly in the growth markets of India, Singapore, China, and the Middle East."

Fourth Quarter 2013 Results

• Sales for the fourth quarter were a record $31,803,000, up 9.7% from sales of $28,990,000 in the same period of the prior year.
• Net earnings for the quarter were $1,217,000, or $0.46 per diluted share, as compared to earnings of $1,256,000, or $0.49 per diluted share, in the same period of the prior year.
• The order backlog was $80.2 million at April 30, 2013, as compared to $86.2 million at April 30, 2012. The change in the backlog reflects the manufacturing and shipping of a large international order during the year, which was partially offset by a small increase in the domestic order backlog.

"Fiscal year 2013 was an excellent year," said William A. Shumaker, Kewaunee's Chief Executive Officer. "I am pleased that we exceeded our sales and earnings goals and made excellent progress against our goals to strengthen the Kewaunee brand, strengthen relationships with existing customers, build relationships with new and prospective customers, reduce costs, and increase market share. The progress in all of these areas not only resulted in record sales for the fourth quarter and year, but it provides momentum as we enter the new year.

"As I look forward to fiscal year 2014, I expect progress to continue in all of the above areas. Although my retirement will take me out of the day-to-day operations of the Company as of the end of this month, I have the utmost confidence in the members of the management team, each of whom has many years of valuable experience in the laboratory furniture industry."

STATESVILLE, N.C., May 29, 2013 /PRNewswire/ -- Kewaunee Scientific Corporation (Nasdaq: KEQU) announced today its Board of Directors declared a quarterly cash dividend of ten cents per outstanding share, payable on June 24, 2013 to stockholders of record at the close of business on June 10, 2013.

Third Quarter 2013 Results

• .Sales for the quarter were $27,450,000, up 27% from sales of $21,574,000 in the third quarter last year.
•  Net earnings for the quarter were $544,000, or $0.21 per diluted share, as compared to a net loss of $122,000, or $0.05 per diluted share, in the third quarter last year.
• The order backlog was $84.5 million at January 31, 2013, up from $77.1 million at January 31, 2012.

"We continued to make excellent progress during the quarter," said William A. Shumaker, Kewaunee's Chief Executive Officer. "I am pleased with sales and earnings, particularly since the third quarter is historically our slowest due to normal construction cycles and the large number of holidays. We continue to see positive results from our strengthened domestic dealer network and our broadened international dealer network. When combined with our lower manufacturing costs, this is providing us with more opportunities to close orders in both of these geographic markets.

"Looking forward, we expect to have a strong finish to our year. Incoming orders and customer delivery requirements for our metal furniture, fume hoods, and epoxy resin products have provided us a strong backlog of orders scheduled to ship in the fourth quarter. This increased demand and our lower costs are expected to more than offset the continuing lower demand for publicly-funded wood educational projects. It should be mentioned that results for the fourth quarter of last year were unusually strong, as results were favorably impacted by several large international projects that were manufactured and shipped during the quarter."

First Quarter 2013 Results

• Sales for the quarter were $26,683,000, up 1.4% from sales of $26,321,000 in the first quarter last year.
• Net earnings for the quarter were $634,000, or $0.25 per diluted share, up from net earnings of $22,000, or $0.01 per diluted share, in the first quarter of the prior year.
• The order backlog increased to a record $86.7 million at July 31, 2012, up from $86.2 million at April 30, 2012 and $69.7 million at July 31, 2011.
  

"We are pleased with our continuing progress," said William A. Shumaker, Kewaunee's Chief Executive Officer. "Sales and earnings are benefiting from our strengthened and expanded dealer network, new innovative products being introduced to the marketplace, and lower manufacturing and overhead costs. Additionally, earnings and profit margins are benefiting from an improved product mix related to our strategy to sell more laboratory projects through our dealer network.

Disclosure: GeoInvesting is providing this information for your edification and in no way has any affiliation with any promoters and/or newsletters disseminating information on KEQU, nor is GeoInvesting being paid to post this information. At times, the GeoTeam may trade P&D's on a long or short basis, depending on how we feel the momentum of the stocks will be affected by the efforts of stock promoters and any ensuing dumps.

Fourth Quarter 2012 Results

• Net earnings for the fourth quarter were $1,256,000, or $0.49 per diluted share, up from net earnings of $252,000, or $0.10 per diluted share, in the same period of the prior year.
• Sales for the quarter were $28,990,000, up 8% from sales of $26,952,000 in the same period of the prior year. Sales from domestic operations were $19,607,000, down 10% from sales of $21,797,000 in the prior year.

The order backlog increased to a record $86.2 million at April 30, 2012, up from $65.7 million at April 30, 2011, with both domestic and international orders contributing to the growth. The backlog at April 30, 2012 includes a contract awarded during the quarter for laboratory furniture and equipment for the Kuwait University College of Engineering and Petroleum-Women's Campus. The contract, which is in excess of $11 million, was awarded through Kewaunee's dealer in Kuwait, Advanced Technology Company (ATC). The Company expects to begin manufacturing and shipping products under the contract in the late summer or early fall of calendar year 2013. The majority of the manufactured products will be produced at the Company's Statesville facilities. This contract is another indication of the Company's increased international presence and capabilities.

"We are very pleased with our operating results for the quarter," said William A. Shumaker, Kewaunee's Chief Executive Officer. "Our international operations had an outstanding quarter for sales and earnings, as manufacturing and shipping occurred under several large contracts. In Statesville, earnings improved significantly, as we experienced lower operating costs resulting from cost savings initiatives."

Outlook

"Looking forward to fiscal year 2013, I remain cautiously optimistic," Mr. Shumaker continued. "My optimism is based on a number of factors. On the domestic front, we enter the year with a strengthened and expanded dealer network, which we believe will result in increased sales and earnings. We are also realizing lower operating costs from our cost savings initiatives put in place over the past year. On the international front, we have also strengthened and expanded our dealer network, better positioning us to take advantage of the growing number of laboratory project opportunities in Asia and the Middle East. Furthermore, both domestic and international operations will benefit from our record order backlog.

"At the same time, fiscal year 2013 will present us with significant challenges. The ongoing world-wide economic slowdown continues to depress construction activity and pricing in the marketplace. Customer delivery requirements for large international projects, more so than domestic projects, often are delayed due to changes in construction schedules, resulting in uneven reportable sales and earnings."

We are removing Kewaunee Scientific from the GeoSpecial list. EPS growth has not been spectacular or consistent. Furthermore, The company is also highly dependent on the economy, which is still in a fragile state.

Added to the GeoBargain list on June 24, 2009 @ $11.10 

Peak performance: Reached a high of $13.10 on August 26, 2009.

Removed from the GeoBargain list and Added to the GeoSpecial list  on August 29, 2009 @ $13.10 

Peak performance: Reached a high of  $16.42 on February 25, 2010 .
Current Price: $11.65

"Overall, the markets for our products are continuing to hold up well under the global economic slowdown. The domestic laboratory furniture marketplace continues to be healthy, particularly for larger construction projects where our bidding activity remains strong. We also continue to experience good overall bidding activity for smaller domestic laboratory projects, with the level of activity varying by geographic area and market segment. The international laboratory marketplace, while softer than last year, is providing an increasing number of opportunities. The full manufacturing capabilities and lower costs of our new plant in Bangalore, India, are making us more competitive in the Asian marketplace. Both the domestic and international markets remain highly-competitive."

Source: PR Newswire (August 25, 2009)

	1st Quarter 2010	1st Quarter 2009	Period Change
GAAP Revenue	$26.2 million	$25.4 million	3.0%
GAAP EPS	$0.42	$0.38	10.5%
Fully Diluted Shares	2.56 million	2.57 million	0.0%

Source: See Release, August 26, 2009

FULL YEAR 2009 vs. 2008 FINANCIAL SNAPSHOT ENDED APRIL

	Full Year 2009	Full Year 2008	Period Change
GAAP Revenue	$103.98 million	$89.51   million	16.17%
GAAP EPS	$1.66	$1.23	34.96%
Fully Diluted Shares	2.56 million	2.56 million	0.0%

Source: See Release, June 24, 2009

Kewaunee Scientific (NASDAQ:KEQU) was added to the GeoBargain list on June 24, 2009, due to strong April ending 2009 fourth quarter results.  Yesterday, the Company reported its 2010 first quarter financial results, prompting the GeoTeam® to reconsider KEQU 's inclusion on the GeoBargain list. Top and bottom line growth were well below the minimum GeoBargain requirements.

1st QUARTER 2010 vs. 2009 FINANCIAL SNAPSHOT ENDED JULY

	1st Quarter 2010	1st Quarter 2009	Period Change
GAAP Revenue	$26.2 million	$25.4 million	3.0%
GAAP EPS	$0.42	$0.38	10.5%

Source: See Release, August 26, 2009

Select Valuation Items

• Price: $13.10 (8/25/09)
• Trailing P/E: 7.71
• PEG Ratio: 0.73
• Book Value Per Share: 11.49

The stock still reacted positively to yesterday morning's financial news, possibly a reaction to the company also announcing a 25% increase in its quarterly dividend. This action could signify that better earnings per share growth is in the cards for the remainder of the year. There are also positive overtones in the fact that over the last three years Kewaunee Scientific 's second quarter has been sequentially higher than its first quarter. Still, it doesn't appear that KEQU will be able to achieve the GeoBargain required growth traits for 2009. Notwithstanding this shortcoming, the stock is still selling at a P/E of 7.71 and a PEG ratio under 1 which may attract value investors. Accordingly, we are reclassifying KEQU as a GeoSpecial. If the stock can attain a modest P/E of 10, matching its 2009 first quarter EPS growth rate, then it could reach $17.70.

'Looking toward fiscal year 2010, we believe a number of factors have the Company well-positioned for another good year,' continued Mr. Shumaker. 'A healthy domestic laboratory furniture marketplace, our record order backlog, and excellent performances by our factories are providing us strong momentum. The Asian laboratory furniture marketplace, which was soft the past year, is expected to improve and provide increased opportunities. The move to our new, modern plant in Bangalore, India, is now complete. This plant has full manufacturing capabilities which positions us to compete more broadly for additional projects in Asia and the Middle East. Next year will also present a number of challenges. These include uncertainty as to when the global economic slowdown will end and higher pension costs for the Company due to losses in our pension investments portfolio.'

Source: PR Newswire (June 24, 2009)