Kewaunee Scientific Reports Results for Fiscal Year and Fourth Quarter
Fiscal Year 2024 Fourth Quarter Results:
Sales during the fourth quarter of fiscal year 2024 were
During the fourth quarter of the fiscal year, two non-recurring transactions were recorded that impacted reported earnings and EBITDA which management believes should be considered when analyzing our financial results. A detailed discussion of these transactions is included in the Corporate segment commentary below.
Excluding the two non-recurring transactions, adjusted pre-tax earnings for the quarter were
The Company's order backlog was
Domestic Segment
- Domestic sales for the quarter were
International Segment
- International sales for the quarter were
Corporate Segment
– Corporate segment net earnings were
First, the Company successfully annuitized its pension obligation, which had been in a frozen state since 2005. For much of the time since 2005, plan liabilities exceeded plan assets, requiring periodic funding and the recording of an unrealized loss on the Company's Balance Sheet. This loss was then amortized through the Company's Statement of Operations in accordance with pension accounting guidance. By annuitizing the pension obligation, the Company has eliminated all future responsibility for the plan. Terminating the pension resulted in a one-time, non-cash expense and reduction to EBITDA in the quarter of
The second non-recurring adjustment recorded related to the partial release of the Company's valuation allowance. During fiscal 2020, in accordance with GAAP guidance, the Company determined that its deferred tax assets were not likely to be realized. As a result, a valuation allowance was recorded as a reserve against those assets and income tax expense was recognized. At the end of fiscal 2024, the Company re-evaluated this position, determining that the majority of the deferred tax assets are now more likely than not to be realized. Accordingly, the majority of the valuation allowance has been reversed, resulting in a
Excluding these two non-recurring transactions, Corporate segment adjusted EBITDA loss for the quarter was (
Fiscal Year 2024 Full Year Results:
Sales during fiscal year 2024 were
As discussed in the Company's fourth quarter results above, two non-recurring transactions were recorded in the fourth quarter that impacted reported earnings and EBITDA which management believes should be considered when analyzing our financial results.
Excluding these two non-recurring transactions, adjusted pre-tax earnings for the fiscal year were
Domestic Segment
- Domestic sales for the fiscal year were
International Segment
- International sales for the fiscal year were
Corporate Segment
- Corporate segment net earnings was
Excluding the two non-recurring transactions discussed as part of the results of our fourth quarter Corporate segment results, Corporate segment adjusted EBITDA loss for the fiscal year was (
Total cash on hand on
The Company had short-term debt of
"Fiscal year 2024 was a tremendous year for Kewaunee," said Thomas D. Hull III, Kewaunee's President and Chief Executive Officer. "The Company delivered strong financial results as we continue to realize the benefits of our strategic decisions made in recent years. These results have been recognized by the market, resulting in a significant increase in the Company's market capitalization during the year. This is a testament to the hard work and dedication of Kewaunee's global team who are focused on relentlessly delivering on our commitments to our customers."
"We ended the fiscal year with an order backlog of
"We remain focused on Kewaunee's mission, which the Company has proudly pursued since its founding in 1906, which is to encourage new discovery worldwide."
_______________
1 EBITDA, Adjusted EBITDA adjusted net earnings, and adjusted net earnings per share are non-GAAP financial measures. See the tables below for a reconciliation of these non-GAAP measures to the most comparable GAAP measures. |
|
EBITDA and Segment EBITDA Reconciliation
Quarter Ended |
|
Domestic |
|
International |
|
Corporate |
|
Consolidated |
Net Earnings (Loss) |
|
$ 2,402 |
|
$ 1,106 |
|
$ (2,503) |
|
$ 1,005 |
Add/(Less): |
|
|
|
|
|
|
|
|
Interest Expense |
|
— |
|
97 |
|
447 |
|
544 |
Interest Income |
|
— |
|
(194) |
|
(1) |
|
(195) |
Income Taxes |
|
— |
|
449 |
|
779 |
|
1,228 |
Depreciation and Amortization |
|
589 |
|
88 |
|
48 |
|
725 |
EBITDA |
|
$ 2,991 |
|
$ 1,546 |
|
$ (1,230) |
|
$ 3,307 |
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
Domestic |
|
International |
|
Corporate |
|
Consolidated |
Net Earnings (Loss) |
|
$ 3,410 |
|
$ 1,138 |
|
$ 6,478 |
|
$ 11,026 |
Add/(Less): |
|
|
|
|
|
|
|
|
Interest Expense |
|
550 |
|
23 |
|
13 |
|
586 |
Interest Income |
|
— |
|
(211) |
|
(124) |
|
(335) |
Income Taxes |
|
875 |
|
678 |
|
(11,385) |
|
(9,832) |
Depreciation and Amortization |
|
671 |
|
106 |
|
43 |
|
820 |
EBITDA |
|
$ 5,506 |
|
$ 1,734 |
|
$ (4,975) |
|
$ 2,265 |
Pension Termination Costs |
|
— |
|
— |
|
4,019 |
|
4,019 |
Adjusted EBITDA |
|
$ 5,506 |
|
$ 1,734 |
|
$ (956) |
|
$ 6,284 |
|
|
|
|
|
|
|
|
|
Fiscal Year to Date |
|
Domestic |
|
International |
|
Corporate |
|
Consolidated |
Net Earnings (Loss) |
|
$ 3,408 |
|
$ 4,511 |
|
$ (7,181) |
|
$ 738 |
Add/(Less): |
|
|
|
|
|
|
|
|
Interest Expense |
|
— |
|
210 |
|
1,524 |
|
1,734 |
Interest Income |
|
— |
|
(603) |
|
(358) |
|
(961) |
Income Taxes |
|
— |
|
2,250 |
|
889 |
|
3,139 |
Depreciation and Amortization |
|
2,394 |
|
282 |
|
191 |
|
2,867 |
EBITDA |
|
$ 5,802 |
|
$ 6,650 |
|
$ (4,935) |
|
$ 7,517 |
|
|
|
|
|
|
|
|
|
Fiscal Year to Date |
|
Domestic |
|
International |
|
Corporate |
|
Consolidated |
Net Earnings (Loss) |
|
$ 11,808 |
|
$ 3,055 |
|
$ 3,890 |
|
$ 18,753 |
Add/(Less): |
|
|
|
|
|
|
|
|
Interest Expense |
|
1,574 |
|
166 |
|
59 |
|
1,799 |
Interest Income |
|
— |
|
(849) |
|
(244) |
|
(1,093) |
Income Taxes |
|
3,240 |
|
2,935 |
|
(12,113) |
|
(5,938) |
Depreciation and Amortization |
|
2,524 |
|
408 |
|
193 |
|
3,125 |
EBITDA |
|
$ 19,146 |
|
$ 5,715 |
|
$ (8,215) |
|
$ 16,646 |
Pension Termination Costs |
|
— |
|
— |
|
4,019 |
|
4,019 |
Adjusted EBITDA |
|
$ 19,146 |
|
$ 5,715 |
|
$ (4,196) |
|
$ 20,665 |
Adjusted Consolidated Statement of Operations Reconciliation
|
Three Months Ended
|
||||
|
As Reported 2024 |
Pension Settlement |
Valuation |
Adjusted
|
2023 |
Net sales |
$ 56,702 |
$ — |
$ — |
$ 56,702 |
$ 53,986 |
Cost of products sold |
42,062 |
— |
— |
42,062 |
43,625 |
Gross profit |
14,640 |
— |
— |
14,640 |
10,361 |
Operating expenses |
9,082 |
— |
— |
9,082 |
7,660 |
Operating profit |
5,558 |
— |
— |
5,558 |
2,701 |
Pension expense |
(4,055) |
(4,019)1 |
— |
(36) |
(18) |
Other income, net |
430 |
— |
— |
430 |
183 |
Interest expense |
(586) |
— |
— |
(586) |
(544) |
Profit (loss) before income taxes |
1,347 |
(4,019) |
— |
5,366 |
2,322 |
Income tax (benefit) expense |
(9,832) |
(3,870)2 |
(6,583)3 |
621 |
1,228 |
Net earnings (loss) |
11,179 |
(149) |
6,583 |
4,745 |
1,094 |
Less: Net earnings attributable to the non-controlling interest |
153 |
— |
— |
153 |
89 |
Net earnings (loss) attributable to |
$ 11,026 |
$ (149) |
$ 6,583 |
$ 4,592 |
$ 1,005 |
|
|
|
|
|
|
Net earnings (loss) per share attributable to Kewaunee Scientific Corporation stockholders |
|
|
|
|
|
Basic |
$ 3.86 |
$ (0.05) |
$ 2.30 |
$ 1.61 |
$ 0.36 |
Diluted |
$ 3.71 |
$ (0.05) |
$ 2.22 |
$ 1.55 |
$ 0.34 |
|
|
|
|
|
|
|
Twelve Months Ended
|
||||
|
As Reported 2024 |
Pension Settlement |
Valuation |
Adjusted
|
2023 |
Net sales |
$ 203,755 |
$ — |
$ — |
$ 203,755 |
$ 219,494 |
Cost of products sold |
151,704 |
— |
— |
151,704 |
183,906 |
Gross profit |
52,051 |
— |
— |
52,051 |
35,588 |
Operating expenses |
33,770 |
— |
— |
33,770 |
30,224 |
Operating profit |
18,281 |
— |
— |
18,281 |
5,364 |
Pension expense |
(4,177) |
(4,019)1 |
— |
(158) |
(71) |
Other income, net |
814 |
— |
— |
814 |
939 |
Interest expense |
(1,799) |
— |
— |
(1,799) |
(1,734) |
Profit (loss) before income taxes |
13,119 |
(4,019) |
— |
17,138 |
4,498 |
Income tax (benefit) expense |
(5,938) |
(3,870)2 |
(6,583)3 |
4,515 |
3,139 |
Net earnings (loss) |
19,057 |
(149) |
6,583 |
12,623 |
1,359 |
Less: Net earnings attributable to the non-controlling interest |
304 |
— |
— |
304 |
621 |
Net earnings (loss) attributable to Kewaunee Scientific Corporation |
$ 18,753 |
$ (149) |
$ 6,583 |
$ 12,319 |
$ 738 |
|
|
|
|
|
|
Net earnings (loss) per share attributable to Kewaunee Scientific Corporation stockholders |
|
|
|
|
|
Basic |
$ 6.51 |
$ (0.05) |
$ 2.29 |
$ 4.28 |
$ 0.26 |
Diluted |
$ 6.38 |
$ (0.05) |
$ 2.24 |
$ 4.19 |
$ 0.25 |
1 |
Accumulated accounting losses related to the settlement of the Company's pension plan |
2 |
Release of accumulated tax benefit from the settlement of the Company's pension plan |
3 |
Partial reversal of valuation allowance |
About Non-GAAP Measures
The Company includes non-GAAP financial measures such as adjusted net earnings and adjusted net earnings per share, in the information provided with this press release as supplemental information relating to its operating results. Adjusted net earnings represents GAAP net earnings adjusted for net pension settlement expenses and the impact of a valuation allowance release. This financial information is not in accordance with, or an alternative for, GAAP-compliant financial information and may be different from the operating or non-GAAP financial information used by other companies. The Company believes that this presentation of adjusted net earnings and adjusted net earnings per share provides useful information to investors regarding certain additional financial and business trends relating to its financial condition and results of operations.
EBITDA and Segment EBITDA are calculated as net earnings (loss), less interest expense and interest income, income taxes, depreciation, and amortization. Adjusted EBITDA and Adjusted Segment EBITDA are calculated as EBITDA or Segment EBITDA less the impact of the one-time costs incurred for the pension termination enacted during FY24, as discussed in more detail above. We believe EBITDA, Segment EBITDA, Adjusted EBITDA, and Adjusted Segment EBITDA allow management and investors to compare our performance to other companies on a consistent basis without regard to depreciation and amortization or the costs incurred related to our one-time pension termination transaction executed during fiscal year 2024, which can vary significantly between companies depending upon many factors. EBITDA, Segment EBITDA, Adjusted EBITDA, and Adjusted Segment EBITDA are not calculations based upon generally accepted accounting principles, and the method for calculating EBITDA, Segment EBITDA, Adjusted EBITDA, and Adjusted Segment EBITDA can vary among companies. The amounts included in the EBITDA, Segment EBITDA, Adjusted EBITDA, and Adjusted Segment EBITDA calculations, however, are derived from amounts included in the historical consolidated statements of operations. EBITDA, Segment EBITDA, Adjusted EBITDA, and Adjusted Segment EBITDA should not be considered as alternatives to net earnings (loss) or operating earnings (loss) as an indicator of the Company's operating performance, or as an alternative to operating cash flows as a measure of liquidity.
About
Founded in 1906,
The Company's corporate headquarters are located in
This press release contains statements that the Company believes to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this press release, including statements regarding the Company's future financial condition, results of operations, business operations and business prospects, are forward-looking statements. Words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "predict," "believe" and similar words, expressions and variations of these words and expressions are intended to identify forward-looking statements. Such forward-looking statements are subject to known and unknown risks, uncertainties, assumptions, and other important factors that could significantly impact results or achievements expressed or implied by such forward-looking statements. Such factors, risks, uncertainties and assumptions include, but are not limited to: competitive and general economic conditions, including disruptions from government mandates, both domestically and internationally, as well as supplier constraints and other supply disruptions; changes in customer demands; technological changes in our operations or in our industry; dependence on customers' required delivery schedules; risks related to fluctuations in the Company's operating results from quarter to quarter; risks related to international operations, including foreign currency fluctuations; changes in the legal and regulatory environment; changes in raw materials and commodity costs; risks associated with our ability to identify and complete strategic acquisitions or to successfully integrate any businesses that we may acquire; acts of terrorism, war, governmental action, and natural disasters and other Force Majeure events. The cautionary statements made pursuant to the Reform Act herein and elsewhere by us should not be construed as exhaustive. We cannot always predict what factors would cause actual results to differ materially from those indicated by the forward-looking statements. Over time, our actual results, performance, or achievements will likely differ from the anticipated results, performance or achievements that are expressed or implied by our forward-looking statements, and such difference might be significant and harmful to our stockholders' interest. Many important factors that could cause such a difference are described under the caption "Risk Factors," in Item 1A of our Annual Report on Form 10-K for the most recent fiscal year ended
|
|||||||
|
Three Months Ended
|
|
Twelve Months Ended
|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Net sales |
$ 56,702 |
|
$ 53,986 |
|
$ 203,755 |
|
$ 219,494 |
Cost of products sold |
42,062 |
|
43,625 |
|
151,704 |
|
183,906 |
Gross profit |
14,640 |
|
10,361 |
|
52,051 |
|
35,588 |
Operating expenses |
9,082 |
|
7,660 |
|
33,770 |
|
30,224 |
Operating profit |
5,558 |
|
2,701 |
|
18,281 |
|
5,364 |
Pension expense |
(4,055) |
|
(18) |
|
(4,177) |
|
(71) |
Other income, net |
430 |
|
183 |
|
814 |
|
939 |
Interest expense |
(586) |
|
(544) |
|
(1,799) |
|
(1,734) |
Profit before income taxes |
1,347 |
|
2,322 |
|
13,119 |
|
4,498 |
Income tax (benefit) expense |
(9,832) |
|
1,228 |
|
(5,938) |
|
3,139 |
Net earnings |
11,179 |
|
1,094 |
|
19,057 |
|
1,359 |
Less: Net earnings attributable to the non-controlling interest |
153 |
|
89 |
|
304 |
|
621 |
Net earnings attributable to |
$ 11,026 |
|
$ 1,005 |
|
$ 18,753 |
|
$ 738 |
|
|
|
|
|
|
|
|
Net earnings per share attributable to |
|
|
|
|
|
|
|
Basic |
$ 3.86 |
|
$ 0.36 |
|
$ 6.51 |
|
$ 0.26 |
Diluted |
$ 3.71 |
|
$ 0.34 |
|
$ 6.38 |
|
$ 0.25 |
Weighted average number of common shares outstanding |
|
|
|
|
|
|
|
Basic |
2,858 |
|
2,830 |
|
2,879 |
|
2,824 |
Diluted |
2,972 |
|
2,928 |
|
2,938 |
|
2,902 |
|
|||
|
|
|
|
Assets |
|
|
|
Cash and cash equivalents |
$ 23,267 |
|
$ 8,078 |
Restricted cash |
2,671 |
|
5,737 |
Receivables, less allowances |
45,064 |
|
46,081 |
Inventories |
20,679 |
|
21,889 |
Prepaid expenses and other current assets |
5,136 |
|
6,135 |
Total Current Assets |
96,817 |
|
87,920 |
Net Property, Plant and Equipment |
17,649 |
|
16,402 |
Right of use assets |
7,454 |
|
9,170 |
Deferred income taxes |
7,401 |
|
— |
Other assets |
5,445 |
|
5,406 |
Total Assets |
$ 134,766 |
|
$ 118,898 |
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
Short-term borrowings |
$ 3,099 |
|
$ 3,587 |
Current portion of lease obligations |
2,234 |
|
2,052 |
Current portion of financing liability |
713 |
|
642 |
Accounts payable |
23,262 |
|
23,599 |
Other Current Liabilities |
11,472 |
|
10,173 |
Total Current Liabilities |
40,780 |
|
40,053 |
Long-term portion of lease obligations |
5,669 |
|
7,284 |
Long-term portion of financing liability |
27,420 |
|
28,132 |
Other non-current liabilities |
4,688 |
|
4,944 |
Total Liabilities |
78,557 |
|
80,413 |
Commitments and Contingencies |
|
|
|
Kewaunee Scientific Corporation Equity |
54,760 |
|
37,409 |
Non-controlling interest |
1,449 |
|
1,076 |
Total Stockholders' Equity |
56,209 |
|
38,485 |
Total Liabilities and Stockholders' Equity |
$ 134,766 |
|
$ 118,898 |
Contact: |
Donald T. Gardner III |
|
704/871-3274 |
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