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Kewaunee Scientific's Earnings and Sales Decline Y/Y in Q1
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Kewaunee Scientific Corporation (KEQU - Free Report) reported mixed results for first-quarter fiscal 2025, with both earnings per share (EPS) and sales declining year over year. The company faced headwinds from delayed international shipments, particularly in India, which weighed on its overall performance.
However, domestic operations were stable in the quarter under review, and a growing order backlog suggests the potential for recovery in the coming quarters. Rising costs, driven by higher professional fees, also impacted profitability, but management remains optimistic about growth.
Kewaunee Scientific Corporation Price, Consensus and EPS Surprise
The company reported a diluted EPS of 74 cents for first-quarter fiscal 2025, declining from 86 cents in the prior-year quarter.
Total quarterly sales of $48.4 million declined 2.9% from the $49.8 million reported in the prior-year quarter.
The weak quarterly results were attributed to delayed international shipments, particularly in India, wherein customer construction site delays postponed the timing of deliveries. The International segment saw a 10.7% year-over-year drop, contributing to the overall lower sales performance.
Segmental Performance
Kewaunee Scientific's first-quarter fiscal 2025 segmental performance presented a mixed picture across its domestic and international operations, with domestic strength somewhat offset by global challenges.
Domestic Segment: Domestic sales grew 0.3% to $35.5 million from $35.4 million in first-quarter fiscal 2024. This slight increase in sales is attributed to stable demand across all end markets.
Domestic net earnings improved year over year to $2.9 million from $2.7 million, driven by consistent manufacturing loadings. EBITDA for the domestic segment also rose to $4.7 million from $4.6 million, reflecting the stability of the domestic operations. Domestic performance remained strong as demand for its products held steady.
International Segment: International sales declined 10.7% to $12.9 million from $14.4 million in first-quarter fiscal 2024. The decline was primarily caused by customer construction delays in India, which postponed the timing of shipments and services.
International net earnings dipped to $0.46 million from $0.47 million in the prior year, while EBITDA for the segment improved to $0.70 million from $0.67 million, showing some operational efficiency despite lower sales. The delays in project deliveries impacted revenue recognition, leading to the segment’s overall weaker performance.
Corporate Segment: The corporate segment recorded a pre-tax net loss of $1.99 million in first-quarter fiscal 2025, wider than the loss of $1 million recorded in first-quarter fiscal 2024. This wider loss was led by an increase in professional service fees unrelated to the core business and changes in corporate cost allocation.
Corporate EBITDA declined to a loss of $2.1 million, compared with a loss of $0.94 million in the previous year.
Profitability
The company's gross profit increased 4.8% to $12.49 million from $11.91 million in the prior year.
Operating profit fell to $2.58 million from $3.81 million in the prior-year quarter due to an increase in operating costs, attributed to higher professional fees.
Overall, consolidated EBITDA fell 22.8% to $3.33 million from $4.31 million in first-quarter fiscal 2024, reflecting weaker profitability across the business.
Costs
Kewaunee Scientific's first-quarter fiscal 2025 results reflect a rise in costs, affecting profitability despite stable domestic demand. The cost of products sold for the quarter was $35.9 million, a decrease from $37.9 million in first-quarter fiscal 2024.
Operating costs, however, increased 22.3% year over year to $9.9 million from $8.1 million. This increase was led by a $0.73-million rise in professional service fees unrelated to the core business.
Cash & Debt
Kewaunee Scientific ended first-quarter fiscal 2025 with cash on hand of $25.2 million, a slight decrease from $25.9 million at the end of the prior quarter (April 30, 2024). Working capital increased to $56 million from $49.3 million in first-quarter fiscal 2024.
In terms of debt, short-term borrowings rose to $3.6 million from $3.1 million at the end of April 2024. Long-term debt stood at $28.3 million, slightly lower than the $28.5 million reported in the prior quarter.
Of this long-term debt, $28 million is tied to Kewaunee Scientific's December 2021 sale-leaseback transaction, leaving just $0.34 million as the remaining long-term debt. The company's debt-to-equity ratio improved slightly to 0.68-to-1 at the end of first-quarter fiscal 2025 from 0.70-to-1 at the end of fiscal 2024.
Management View
Kewaunee Scientific's president and CEO, Thomas D. Hull III, expressed optimism about the company's future, citing a strong order backlog of $159.4 million in the first quarter of fiscal 2025, up from $140.8 million a year ago. The robust backlog and a high level of project quoting activity suggest that the company anticipates strong performance in the coming quarters, particularly as delayed international projects progress.
Kewaunee Scientific's first-quarter fiscal 2025 results reflected the challenges posed by delayed international shipments and rising operating costs. The company's strong order backlog and stable domestic demand position it for growth.
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Kewaunee Scientific's Earnings and Sales Decline Y/Y in Q1
Kewaunee Scientific Corporation (KEQU - Free Report) reported mixed results for first-quarter fiscal 2025, with both earnings per share (EPS) and sales declining year over year. The company faced headwinds from delayed international shipments, particularly in India, which weighed on its overall performance.
However, domestic operations were stable in the quarter under review, and a growing order backlog suggests the potential for recovery in the coming quarters. Rising costs, driven by higher professional fees, also impacted profitability, but management remains optimistic about growth.
Kewaunee Scientific Corporation Price, Consensus and EPS Surprise
Kewaunee Scientific Corporation price-consensus-eps-surprise-chart | Kewaunee Scientific Corporation Quote
Q1 Results
The company reported a diluted EPS of 74 cents for first-quarter fiscal 2025, declining from 86 cents in the prior-year quarter.
Total quarterly sales of $48.4 million declined 2.9% from the $49.8 million reported in the prior-year quarter.
The weak quarterly results were attributed to delayed international shipments, particularly in India, wherein customer construction site delays postponed the timing of deliveries. The International segment saw a 10.7% year-over-year drop, contributing to the overall lower sales performance.
Segmental Performance
Kewaunee Scientific's first-quarter fiscal 2025 segmental performance presented a mixed picture across its domestic and international operations, with domestic strength somewhat offset by global challenges.
Domestic Segment: Domestic sales grew 0.3% to $35.5 million from $35.4 million in first-quarter fiscal 2024. This slight increase in sales is attributed to stable demand across all end markets.
Domestic net earnings improved year over year to $2.9 million from $2.7 million, driven by consistent manufacturing loadings. EBITDA for the domestic segment also rose to $4.7 million from $4.6 million, reflecting the stability of the domestic operations. Domestic performance remained strong as demand for its products held steady.
International Segment: International sales declined 10.7% to $12.9 million from $14.4 million in first-quarter fiscal 2024. The decline was primarily caused by customer construction delays in India, which postponed the timing of shipments and services.
International net earnings dipped to $0.46 million from $0.47 million in the prior year, while EBITDA for the segment improved to $0.70 million from $0.67 million, showing some operational efficiency despite lower sales. The delays in project deliveries impacted revenue recognition, leading to the segment’s overall weaker performance.
Corporate Segment: The corporate segment recorded a pre-tax net loss of $1.99 million in first-quarter fiscal 2025, wider than the loss of $1 million recorded in first-quarter fiscal 2024. This wider loss was led by an increase in professional service fees unrelated to the core business and changes in corporate cost allocation.
Corporate EBITDA declined to a loss of $2.1 million, compared with a loss of $0.94 million in the previous year.
Profitability
The company's gross profit increased 4.8% to $12.49 million from $11.91 million in the prior year.
Operating profit fell to $2.58 million from $3.81 million in the prior-year quarter due to an increase in operating costs, attributed to higher professional fees.
Overall, consolidated EBITDA fell 22.8% to $3.33 million from $4.31 million in first-quarter fiscal 2024, reflecting weaker profitability across the business.
Costs
Kewaunee Scientific's first-quarter fiscal 2025 results reflect a rise in costs, affecting profitability despite stable domestic demand. The cost of products sold for the quarter was $35.9 million, a decrease from $37.9 million in first-quarter fiscal 2024.
Operating costs, however, increased 22.3% year over year to $9.9 million from $8.1 million. This increase was led by a $0.73-million rise in professional service fees unrelated to the core business.
Cash & Debt
Kewaunee Scientific ended first-quarter fiscal 2025 with cash on hand of $25.2 million, a slight decrease from $25.9 million at the end of the prior quarter (April 30, 2024). Working capital increased to $56 million from $49.3 million in first-quarter fiscal 2024.
In terms of debt, short-term borrowings rose to $3.6 million from $3.1 million at the end of April 2024. Long-term debt stood at $28.3 million, slightly lower than the $28.5 million reported in the prior quarter.
Of this long-term debt, $28 million is tied to Kewaunee Scientific's December 2021 sale-leaseback transaction, leaving just $0.34 million as the remaining long-term debt. The company's debt-to-equity ratio improved slightly to 0.68-to-1 at the end of first-quarter fiscal 2025 from 0.70-to-1 at the end of fiscal 2024.
Management View
Kewaunee Scientific's president and CEO, Thomas D. Hull III, expressed optimism about the company's future, citing a strong order backlog of $159.4 million in the first quarter of fiscal 2025, up from $140.8 million a year ago. The robust backlog and a high level of project quoting activity suggest that the company anticipates strong performance in the coming quarters, particularly as delayed international projects progress.
Kewaunee Scientific's first-quarter fiscal 2025 results reflected the challenges posed by delayed international shipments and rising operating costs. The company's strong order backlog and stable domestic demand position it for growth.