[Fiscal Year 2026 First Quarter Highlights](index=1&type=section&id=Fiscal%20Year%202026%20First%20Quarter%20Highlights) Kewaunee Scientific reported strong Q1 FY2026 results with significant sales and earnings growth, improved financial position, and positive segment performance, driven by the Nu Aire acquisition [Consolidated Financial Performance](index=1&type=section&id=Consolidated%20Financial%20Performance) Kewaunee Scientific reported strong consolidated results for Q1 FY2026, with significant increases in sales, pre-tax earnings, net earnings, and EBITDA compared to the prior year, driven by the Nu Aire acquisition and improved operational efficiency Consolidated Financial Highlights | Metric | Q1 FY2026 ($ in thousands) | Q1 FY2025 ($ in thousands) | Change (%) | | :----- | :------------------------- | :------------------------- | :--------- | | Sales | $71,104 | $48,393 | 46.9% | | Pre-tax Earnings | $3,920 | $2,430 | 61.3% | | Net Earnings | $3,093 | $2,193 | 41.1% | | EBITDA | $6,320 | $3,325 | 90.1% | | Diluted EPS | $1.04 | $0.74 | 40.5% | | Order Backlog (July 31, 2025) ($ million) | $205.0 | $159.4 (July 31, 2024) | 28.6% | | Order Backlog (April 30, 2025) ($ million) | $205.0 | $214.6 | -4.5% | [Segment Performance Overview](index=1&type=section&id=Segment%20Performance%20Overview) Both Domestic and International segments showed strong sales and earnings growth, while the Corporate segment experienced an increased pre-tax net loss due to strategic investments in its platform [Domestic Segment](index=1&type=section&id=Domestic%20Segment) The Domestic segment achieved significant sales and earnings growth, driven by the Nu Aire acquisition and operational improvements Domestic Segment Financials | Metric | Q1 FY2026 ($ in thousands) | Q1 FY2025 ($ in thousands) | Change (%) | | :----- | :------------------------- | :------------------------- | :--------- | | Sales | $54,352 | $35,523 | 53.0% | | Net Earnings | $4,722 | $2,871 | 64.5% | | EBITDA | $7,576 | $4,738 | 59.9% | - Growth was driven by the incorporation of Nu Aire's results, steady manufacturing volumes, improved productivity, and cost management actions[4](index=4&type=chunk) [International Segment](index=1&type=section&id=International%20Segment) The International segment experienced strong sales and earnings growth due to reduced customer site delays International Segment Financials | Metric | Q1 FY2026 ($ in thousands) | Q1 FY2025 ($ in thousands) | Change (%) | | :----- | :------------------------- | :------------------------- | :--------- | | Sales | $16,752 | $12,870 | 30.2% | | Net Earnings | $643 | $463 | 38.9% | | EBITDA | $1,055 | $696 | 51.6% | - Increased deliveries and billings were a result of decreasing customer site delays experienced during most of the prior fiscal year[5](index=5&type=chunk) [Corporate Segment](index=1&type=section&id=Corporate%20Segment) The Corporate segment's pre-tax net loss increased due to strategic investments in its platform and higher compliance costs Corporate Segment Financials | Metric | Q1 FY2026 ($ in thousands) | Q1 FY2025 ($ in thousands) | Change | | :----- | :------------------------- | :------------------------- | :----- | | Pre-tax Net Loss | $3,058 | $1,992 | Increased Loss | | EBITDA | ($2,311) | ($2,109) | Increased Negative | - Increased costs in the current year period are related to strategic investments in the Corporate platform, including increased compliance costs for anticipated Sarbanes-Oxley 404(b) requirements and investments in people, processes, and technology to support future growth[7](index=7&type=chunk) [Financial Position Snapshot](index=2&type=section&id=Financial%20Position%20Snapshot) The company improved its cash position and working capital while slightly reducing both short-term and long-term debt, leading to a lower debt-to-equity ratio compared to the previous quarter Key Financial Position Metrics | Metric | July 31, 2025 ($ in thousands) | April 30, 2025 ($ in thousands) | Change | | :----- | :----------------------------- | :----------------------------- | :----- | | Total Cash on Hand | $20,441 | $17,164 | Up $3,277 | | Working Capital | $66,662 | $64,651 | Up $2,011 | | Short-term Debt | $4,294 | $4,773 | Down $479 | | Long-term Debt | $60,269 | $60,730 | Down $461 | | Debt-to-Equity Ratio | 0.94-to-1 | 0.99-to-1 | Improved | | Debt-to-Equity Ratio (net of sale-leaseback) | 0.54-to-1 | 0.57-to-1 | Improved | [Management Commentary and Business Outlook](index=2&type=section&id=Management%20Commentary%20and%20Business%20Outlook) Management highlights solid Q1 performance, acknowledges project delivery volatility, and outlines strategic investments for long-term growth, expecting improved FY2026 unadjusted EBITDA [CEO's Remarks and Outlook](index=2&type=section&id=CEO%27s%20Remarks%20and%20Outlook) CEO Thomas D. Hull III highlighted solid Q1 performance despite challenging market conditions but anticipates uneven quarterly performance for FY2026 due to project delivery timeline volatility. The company is focused on strategic investments for sustainable long-term growth, expecting better unadjusted EBITDA for FY2026 than FY2025 despite near-term pressure on earnings - Domestic and International segments delivered **solid financial performance in Q1** despite challenging market conditions (uncertain government policy, evolving tariff structures, geopolitical upheaval)[10](index=10&type=chunk) - Overall backlog remains near historically high levels, but volatility in project delivery timelines is expected to cause **uneven quarterly performance for the balance of fiscal year 2026**, likely starting in Q2[10](index=10&type=chunk) - Kewaunee is focused on organic and inorganic growth, making strategic investments in people, processes, and technology, which will place pressure on near-term earnings but position the company for rapid and sustained long-term growth[10](index=10&type=chunk) - Despite anticipated uneven quarterly performance and increasing strategic investment, the company expects to deliver **better unadjusted EBITDA in fiscal year 2026 than in fiscal year 2025**[10](index=10&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations for non-GAAP measures like EBITDA and adjusted net earnings, clarifying their calculation and purpose as supplemental financial information [EBITDA and Segment EBITDA Reconciliation](index=3&type=section&id=EBITDA%2C%20Segment%20EBITDA%2C%20Adjusted%20EBITDA%2C%20and%20Adjusted%20Segment%20EBITDA%20Reconciliation) This section provides a detailed reconciliation of Net Earnings (Loss) to EBITDA and Adjusted EBITDA for consolidated and segment levels for Q1 FY2026 and Q1 FY2025, highlighting adjustments for interest, taxes, depreciation, amortization, and professional/other fees related to the Nu Aire acquisition and integration Consolidated EBITDA and Adjusted EBITDA Reconciliation | Metric (Consolidated) | Q1 FY2026 ($ in thousands) | Q1 FY2025 ($ in thousands) | | :-------------------- | :------------------------- | :------------------------- | | Net Earnings | $3,093 | $2,193 | | Interest Expense | $1,058 | $472 | | Interest Income | ($141) | ($347) | | Income Taxes | $761 | $192 | | Depreciation and Amortization | $1,549 | $815 | | **EBITDA** | **$6,320** | **$3,325** | | Professional & Other Fees | $224 | $730 | | **Adjusted EBITDA** | **$6,544** | **$4,055** | - Professional and other fees in Q1 FY2025 related to the Nu Aire acquisition, while Q1 FY2026 fees related to the integration of Nu Aire[11](index=11&type=chunk) [Adjusted Consolidated Statement of Operations Reconciliation](index=4&type=section&id=Adjusted%20Consolidated%20Statement%20of%20Operations%20Reconciliation) This reconciliation adjusts the consolidated statement of operations for Q1 FY2026 and Q1 FY2025 to exclude professional and other fees related to the Nu Aire integration, providing adjusted net earnings and diluted EPS figures Adjusted Consolidated Statement of Operations | Metric (Consolidated) | As Reported 2025 ($ in thousands) | Professional & Other Fees 2025 ($ in thousands) | Adjusted 2025 ($ in thousands) | Adjusted 2024 ($ in thousands) | | :-------------------- | :-------------------------------- | :---------------------------------------------- | :----------------------------- | :----------------------------- | | Net sales | $71,104 | $— | $71,104 | $48,393 | | Gross profit | $20,930 | $— | $20,930 | $12,488 | | Operating expenses | $16,120 | $224 | $15,896 | $9,183 | | Operating profit | $4,810 | $224 | $5,034 | $3,305 | | Profit before income taxes | $3,920 | $224 | $4,144 | $3,160 | | Income tax (benefit) expense | $761 | $49 | $810 | $345 | | Net earnings attributable to Kewaunee Scientific Corporation | $3,093 | $175 | $3,268 | $2,770 | | Diluted EPS | $1.04 | $0.06 | $1.10 | $0.93 | - Adjustments for professional and other fees in Q1 FY2026 (including estimated tax impact) relate to the integration of the newly acquired subsidiary, Nu Aire[12](index=12&type=chunk) [Explanation of Non-GAAP Measures](index=5&type=section&id=About%20Non-GAAP%20Measures) This section clarifies the company's use of non-GAAP financial measures like adjusted net earnings, adjusted EPS, EBITDA, and Adjusted EBITDA, explaining their calculation and purpose as supplemental information for investors to understand financial and business trends, while emphasizing they are not GAAP alternatives - Adjusted net earnings and adjusted net earnings per share are GAAP net earnings adjusted for professional and other fees related to the integration of Nu Aire, Inc., and the corresponding tax impact[13](index=13&type=chunk) - EBITDA and Segment EBITDA are calculated as net earnings (loss), less interest expense and interest income, income taxes, depreciation, and amortization[14](index=14&type=chunk) - Adjusted EBITDA and Adjusted Segment EBITDA further exclude professional and other fees related to Nu Aire integration[14](index=14&type=chunk) - These non-GAAP measures provide useful information to investors for comparing performance consistently across companies, but should not be considered alternatives to GAAP net earnings or operating cash flows[13](index=13&type=chunk)[14](index=14&type=chunk) [Company Overview](index=5&type=section&id=Company%20Overview) Kewaunee Scientific, a global leader in laboratory furniture, recently acquired Nu Aire, a key manufacturer of biological safety cabinets, expanding its product portfolio and market reach [About Kewaunee Scientific](index=5&type=section&id=About%20Kewaunee%20Scientific) Founded in 1906, Kewaunee Scientific Corporation is a global leader in designing, manufacturing, and installing laboratory, healthcare, and technical furniture products, with manufacturing facilities in the US and India and sales offices worldwide - Kewaunee Scientific Corporation, founded in 1906, is a **global leader** in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products[15](index=15&type=chunk) - Products include steel and wood casework, fume hoods, adaptable modular systems, moveable workstations, stand-alone benches, biological safety cabinets, and epoxy resin work surfaces and sinks[15](index=15&type=chunk) - Headquarters in Statesville, NC, with sales offices in the US, India, Saudi Arabia, and Singapore, and manufacturing facilities in Statesville (3) and Bangalore, India (1)[15](index=15&type=chunk) [About Nu Aire](index=5&type=section&id=Kewaunee%20Scientific%27s%20newly%20acquired%20subsidiary%2C%20Nu%20Aire) Nu Aire, acquired by Kewaunee Scientific, is a leading manufacturer of biological safety cabinets, CO2 incubators, ultralow freezers, and other essential laboratory products, complementing Kewaunee's portfolio, with headquarters and manufacturing in Minnesota - Nu Aire, founded in 1971 and newly acquired by Kewaunee Scientific, is a **leading manufacturer** of biological safety cabinets, CO2 incubators, ultralow freezers, and other essential laboratory products[16](index=16&type=chunk) - Headquarters and manufacturing facilities are in Plymouth, Minnesota, with additional manufacturing in Long Lake, Minnesota, and partnerships in the Netherlands and China[16](index=16&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) This section provides a standard disclaimer regarding forward-looking statements, outlining various risks and uncertainties that could cause actual results to differ materially from projections [Risks and Disclaimers](index=5&type=section&id=Risks%20and%20Disclaimers) This section contains a standard disclaimer regarding forward-looking statements, outlining various known and unknown risks, uncertainties, and assumptions that could cause actual results to differ materially from projections, including those related to the Nu Aire acquisition, economic conditions, customer demands, and international operations. The company disclaims any obligation to update these statements - The press release contains 'forward-looking statements' subject to known and unknown risks, uncertainties, assumptions, and other important factors that could significantly impact results[17](index=17&type=chunk)[18](index=18&type=chunk) - Factors include the ability to realize benefits from the Nu Aire acquisition, competitive and economic conditions, supply disruptions, changes in customer demands, technological changes, dependence on delivery schedules, international operation risks (e.g., currency fluctuations), regulatory changes, raw material costs, and Force Majeure events[18](index=18&type=chunk) - The company assumes no obligation to update any forward-looking statements[18](index=18&type=chunk) [Condensed Consolidated Financial Statements](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated statements of operations and balance sheets for the specified periods, detailing key financial performance and position [Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the unaudited condensed consolidated statements of operations for the three months ended July 31, 2025, and 2024, detailing net sales, cost of products sold, gross profit, operating expenses, and net earnings Condensed Consolidated Statements of Operations | Metric ($ in thousands) | July 31, 2025 | July 31, 2024 | | :-------------------- | :------------ | :------------ | | Net sales | $71,104 | $48,393 | | Cost of products sold | $50,174 | $35,905 | | Gross profit | $20,930 | $12,488 | | Operating expenses | $16,120 | $9,913 | | Operating profit | $4,810 | $2,575 | | Profit before income taxes | $3,920 | $2,430 | | Net earnings attributable to Kewaunee Scientific Corporation | $3,093 | $2,193 | | Diluted EPS | $1.04 | $0.74 | [Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides the unaudited condensed consolidated balance sheets as of July 31, 2025, and April 30, 2025, detailing assets, liabilities, and stockholders' equity, showing changes in cash, receivables, and debt Condensed Consolidated Balance Sheets | Metric ($ in thousands) | July 31, 2025 | April 30, 2025 | | :-------------------- | :------------ | :------------- | | Cash and cash equivalents | $19,489 | $14,942 | | Total Current Assets | $117,148 | $118,363 | | Total Assets | $193,486 | $194,654 | | Total Current Liabilities | $50,486 | $53,712 | | Total Liabilities | $124,617 | $128,409 | | Total Stockholders' Equity | $68,869 | $66,245 |

Core Insights - Kewaunee Scientific Corporation reported a strong financial performance for the first quarter of fiscal year 2026, with significant increases in sales, earnings, and EBITDA compared to the prior year [2][9]. Financial Performance - Sales for the first quarter were $71,104,000, a 46.9% increase from $48,393,000 in the same quarter last year [2]. - Pre-tax earnings rose to $3,920,000, up 61.3% from $2,430,000 in the prior year [2]. - Net earnings increased to $3,093,000 compared to $2,193,000 in the previous year [2]. - EBITDA for the quarter was $6,320,000, compared to $3,325,000 in the prior year [2]. Segment Performance - Domestic sales reached $54,352,000, a 53.0% increase from $35,523,000 in the prior year [4]. - International sales were $16,752,000, reflecting a 30.2% increase from $12,870,000 in the previous year [5]. - The domestic segment's net earnings were $4,722,000, up from $2,871,000 in the prior year [4]. - The international segment's net earnings increased to $643,000 from $463,000 in the previous year [5]. Order Backlog - The company's order backlog was $205.0 million as of July 31, 2025, compared to $159.4 million on July 31, 2024, and $214.6 million on April 30, 2025 [3]. Corporate Segment - The corporate segment reported a pre-tax net loss of $3,058,000, compared to a loss of $1,992,000 in the prior year [6]. - Corporate segment EBITDA was ($2,311,000), slightly worse than ($2,109,000) in the previous year [6]. Cash and Debt Position - Total cash on hand was $20,441,000, up from $17,164,000 on April 30, 2025 [7]. - Short-term debt decreased to $4,294,000 from $4,773,000 on April 30, 2025 [8]. - Long-term debt was $60,269,000, down from $60,730,000 on April 30, 2025 [8]. Management Commentary - The CEO noted solid performance despite challenging market conditions and indicated expectations of volatility in project delivery timelines for the remainder of fiscal year 2026 [9]. - The company is focused on both organic and inorganic growth, with strategic investments in people, processes, and technology to support future growth [9].

Core Insights - Kewaunee Scientific Corporation will participate in the 2025 Arablab Live tradeshow and conference in Dubai from September 23-25 [1] - The company will showcase its integrated expertise in laboratory infrastructure, biosafety, and healthcare environments, alongside its newly acquired subsidiary NuAire and healthcare brand EVERHUTCH [2][4] Company Overview - Kewaunee Scientific Corporation, founded in 1906, is a global leader in designing, manufacturing, and installing laboratory and healthcare furniture products [5] - The company operates manufacturing facilities in Statesville, North Carolina, and Bangalore, India, serving both domestic and international markets [5] Product Offerings - Kewaunee's product range includes steel and wood casework, fume hoods, biological safety cabinets, and epoxy resin work surfaces [5] - The company will highlight its new Revit design tools at the Arablab tradeshow, aimed at enhancing lab planning and architectural precision [3] Subsidiary Information - NuAire, acquired by Kewaunee, specializes in biological safety cabinets and other essential laboratory products, with manufacturing facilities in Minnesota and partnerships in the Netherlands and China [6]

Company Overview - Kewaunee Scientific Corporation, founded in 1906, is a global leader in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products [2] - The company's product offerings include steel and wood casework, fume hoods, adaptable modular systems, moveable workstations, stand-alone benches, biological safety cabinets, and epoxy resin work surfaces and sinks [2] - Kewaunee's corporate headquarters is located in Statesville, North Carolina, with sales offices in the United States, India, Saudi Arabia, and Singapore [2] - The company operates three manufacturing facilities in Statesville and one in Bangalore, India, serving both domestic and international markets [2] Recent Developments - Kewaunee Scientific announced plans to release its first quarter fiscal year 2026 financial results on September 10, 2025, after the close of trading [1] - The newly acquired subsidiary, Nu Aire, specializes in manufacturing biological safety cabinets, CO2 incubators, ultralow freezers, and other essential laboratory products [3] - Nu Aire, founded in 1971, has its headquarters and manufacturing facilities in Plymouth, Minnesota, with additional capabilities in Long Lake, Minnesota, and a warehouse partnership in the Netherlands [3] Future Outlook - The company is focused on realizing the benefits of the Nu Aire acquisition, which is expected to enhance its product portfolio and market reach [5]

Core Viewpoint - Kewaunee Scientific Corporation (KEQU) has received an upgrade to "Outperform" due to strong acquisition execution, sustained margin improvement, a record backlog providing revenue visibility, and partial insulation from macroeconomic challenges through healthcare exposure [1]. Acquisition Execution & Strategic Fit - The acquisition of Nu Aire, Inc. in November 2024 has resulted in a 30.7% year-over-year increase in domestic segment sales, reaching $179.4 million in fiscal 2025 [2]. - This acquisition has expanded KEQU's product portfolio to include higher-margin products like biological safety cabinets, CO2 incubators, and ultralow freezers, while also establishing new distribution partners in previously underpenetrated markets [3]. - Integration progress has exceeded expectations, creating early cross-selling opportunities and reinforcing KEQU's position as a full-spectrum laboratory solutions provider [3]. Gross Margin Expansion & Profitability Gains - KEQU's gross margin has expanded by 310 basis points to 28.6% in fiscal 2025 from 25.5% in fiscal 2024, driven by Nu Aire's favorable product mix, operational efficiencies, and disciplined cost control, despite incurring $6 million in one-time integration and purchase accounting expenses [4]. - Adjusted EBITDA increased by 28.4% to $26.5 million, representing 10.9% of sales, indicating the company's ability to convert top-line gains into higher operating leverage [5]. - The annuitization of the company's pension obligation in fiscal 2024 has reduced earnings volatility, providing a cleaner base for future margin expansion [5]. Record Backlog & Revenue Visibility - KEQU has a record backlog of $214.6 million at the end of fiscal 2025, up 37.9% from the previous year, providing exceptional near-term revenue visibility, with management expecting 93% of orders to convert into revenues in fiscal 2026 [6]. - The backlog includes diverse end markets such as healthcare, pharmaceuticals, and education, which helps mitigate cyclicality often seen in the broader construction and industrial sectors [6]. - The healthcare and life sciences sectors, enhanced by Nu Aire's capabilities, have shown greater resilience against macroeconomic uncertainty, providing KEQU with a degree of macro immunity [7]. Conclusion - Kewaunee's transformation following the Nu Aire acquisition, along with strong domestic performance, expanding margins, record backlog, and attractive valuation, supports an Outperform rating [10]. - The company is positioned to deliver above-market returns over the next 12 months, with key catalysts including backlog conversion and incremental synergies from the Nu Aire integration [10].

Sales Performance - Sales for fiscal year 2025 were $240.5 million, an increase of 18.0% compared to fiscal year 2024 sales of $203.8 million[108]. - Domestic Segment sales for fiscal year 2025 were $179.4 million, an increase of 30.7% compared to fiscal year 2024 sales of $137.2 million, primarily due to the acquisition of Nu Aire[108]. - International Segment sales for fiscal year 2025 were $61.1 million, a decrease of 8.2% from fiscal year 2024 sales of $66.5 million, attributed to customer site delays in India[108]. Financial Metrics - The order backlog was $214.6 million at April 30, 2025, compared to $155.6 million at April 30, 2024[109]. - Gross profit margin increased to 28.6% in fiscal year 2025 from 25.5% in fiscal year 2024, driven by improved manufacturing productivity and the Nu Aire acquisition[109]. - Operating expenses increased to $51.1 million in fiscal year 2025 from $33.8 million in fiscal year 2024, largely due to the acquisition of Nu Aire[110]. - Net earnings for fiscal year 2025 were $11.4 million, or $3.83 per diluted share, down from $18.8 million, or $6.38 per diluted share, in fiscal year 2024[116]. - The effective income tax rate for fiscal year 2025 was 21.7%, compared to an income tax benefit of 45.3% in fiscal year 2024[114]. Acquisition Details - The Company completed the acquisition of Nu Aire for $55.0 million on November 1, 2024, funded through a combination of seller notes and cash[101]. - In November 2024, the company acquired Nu Aire, enhancing its position in laboratory and biosafety solutions[130]. Cash Flow and Investments - Cash used in investing activities for fiscal year 2025 was $30.9 million, primarily for the acquisition of Nu Aire, with capital expenditures of $2.2 million[124]. - Working capital increased to $64.7 million at April 30, 2025, up from $56.0 million at April 30, 2024, with a current assets to current liabilities ratio of 2.2-to-1.0[126]. - The term loan balance was $13.8 million at April 30, 2025, with interest rates on a floating basis, and no advances under the revolving credit facility[132]. Dividend Policy - The company did not declare or pay any dividends during the last two fiscal years, with future dividends dependent on various factors including earnings and capital requirements[127]. Market Outlook - The company's financial outlook is limited by its role as a subcontractor, with demand dependent on laboratory and healthcare construction projects and raw material costs[129]. - Fiscal year 2025 results reflect strong execution and relationships with dealers, supported by a healthy backlog and improved manufacturing capabilities[131]. Currency Exposure - For fiscal year 2025, 23% of net sales were derived from currencies other than U.S. dollars, indicating exposure to foreign currency exchange risks[133]. - Cash balances of $8.4 million were held by subsidiaries in currencies other than U.S. dollars as of April 30, 2025[135].

Core Viewpoint - Kewaunee Scientific Corporation has demonstrated significant growth in both revenue and earnings for the fourth quarter and fiscal year 2025, outperforming the S&P 500 index during the same period [1][2][3]. Revenue & Earnings Performance - Fiscal fourth-quarter net sales increased by 36.1% to $77.1 million from $56.7 million year-over-year [2]. - Adjusted diluted earnings per share (EPS) rose by 25.8% to $1.95 from $1.55 [2]. - For fiscal 2025, net sales totaled $240.5 million, an 18% increase from $203.8 million in the previous year [3]. - Adjusted diluted EPS for the year rose by 28.2% to $5.37 from $4.19 [3]. Segment Highlights - Domestic operations saw a 54.7% increase in fiscal fourth-quarter sales to $55.5 million from $35.9 million [4]. - International sales grew by 3.9% year-over-year in the fiscal fourth quarter to $21.7 million [5]. - The corporate segment reported an adjusted EBITDA loss of $1.4 million, widening from a loss of $956,000 the previous year [6]. Management Commentary - The CEO attributed the strong performance to effective strategy execution and heightened customer demand [7]. - The company acknowledged macroeconomic challenges but highlighted its adaptable culture and partnerships as strengths [8]. Drivers Behind the Results - The acquisition of Nu Aire significantly contributed to revenue and earnings growth, with adjusted operating profit reaching $9.8 million from $5.6 million in the prior year [9]. - The fiscal fourth-quarter adjusted gross profit surged by 69% to $24.7 million from $14.6 million [10]. Guidance - Management expressed optimism for continued growth through organic initiatives and potential future acquisitions [12]. Other Developments - Kewaunee completed the acquisition of Nu Aire on November 1, 2024, which is expected to generate long-term synergies despite short-term costs [13]. - The acquisition led to an increase in long-term debt and a rise in the debt-to-equity ratio to 0.99-to-1 from 0.70-to-1 the previous year [14].

Company Overview - Kewaunee Scientific (NASDAQ: KEQU) specializes in designing laboratory furniture and equipment [1] Market Sentiment - The stock has faced pessimism due to the arrival of the Department of Government Efficiency and proposals to cut the budget for the National Institutes of Health [1]

[Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) Kewaunee reported strong sales growth in Q4 and full year fiscal 2025, driven by the Nu Aire acquisition and higher volumes, with adjusted earnings showing substantial improvement despite GAAP declines due to prior-year non-recurring items [Fourth Quarter Fiscal Year 2025 Results](index=1&type=section&id=Fourth%20Quarter%20Fiscal%20Year%202025%20Results) In the fourth quarter of fiscal year 2025, Kewaunee reported a **significant 36.1% increase** in sales year-over-year, driven by higher volumes and the Nu Aire acquisition. While GAAP net earnings and EPS declined due to large, non-recurring tax benefits in the prior-year quarter, adjusted earnings, which exclude acquisition costs and prior-year anomalies, showed substantial growth. Adjusted pre-tax earnings rose **56.7%** and the order backlog remained strong at **$214.6 million** Q4 FY2025 vs Q4 FY2024 Performance (GAAP) (in millions) | Metric | Q4 FY2025 | Q4 FY2024 | Change | | :--- | :--- | :--- | :--- | | Sales | $77.1 million | $56.7 million | +36.1% | | Pre-Tax Earnings | $7.1 million | $1.3 million | +430.7% | | Net Earnings | $4.9 million | $11.0 million | -56.0% | | Diluted EPS | $1.63 | $3.71 | -56.1% | | EBITDA | $9.7 million | $2.3 million | +327.0% | - The **significant decrease** in GAAP Net Earnings and EPS is **primarily due to** two non-recurring items in the prior year's fourth quarter: a **one-time, non-cash pension termination expense and a substantial tax benefit from the release of a valuation allowance**[4](index=4&type=chunk) Q4 FY2025 vs Q4 FY2024 Performance (Adjusted) (in millions) | Metric | Q4 FY2025 (Adjusted) | Q4 FY2024 (Adjusted) | Change | | :--- | :--- | :--- | :--- | | Pre-Tax Earnings | $8.4 million | $5.4 million | +56.7% | | Net Earnings | $5.8 million | $4.6 million | +26.6% | | Diluted EPS | $1.95 | $1.55 | +25.8% | | EBITDA | $10.3 million | $6.3 million | +64.2% | - The company's order backlog was **$214.6 million** as of April 30, 2025, a **significant increase** from **$155.6 million** on April 30, 2024, indicating **strong future demand**[3](index=3&type=chunk) [Full Year Fiscal Year 2025 Results](index=3&type=section&id=Full%20Year%20Fiscal%20Year%202025%20Results) For the full fiscal year 2025, sales grew by **18.0%** to **$240.5 million**. Similar to the quarterly results, GAAP net earnings were lower than the prior year due to non-recurring items. However, on an adjusted basis, which excludes **$6.0 million** in costs related to the Nu Aire acquisition, pre-tax earnings increased by **21.5%** and adjusted diluted EPS rose to **$5.37** from **$4.19**, reflecting **strong underlying operational performance** Full Year FY2025 vs FY2024 Performance (GAAP) (in millions) | Metric | FY2025 | FY2024 | Change | | :--- | :--- | :--- | :--- | | Sales | $240.5 million | $203.8 million | +18.0% | | Pre-Tax Earnings | $14.8 million | $13.1 million | +12.7% | | Net Earnings | $11.4 million | $18.8 million | -39.2% | | Diluted EPS | $3.83 | $6.38 | -40.0% | | EBITDA | $21.6 million | $16.6 million | +29.8% | - Fiscal year 2025 results were **impacted by** **$6.0 million** in costs related to the **acquisition, integration, and purchase accounting for Nu Aire, which reduced pre-tax earnings**[17](index=17&type=chunk) Full Year FY2025 vs FY2024 Performance (Adjusted) (in millions) | Metric | FY2025 (Adjusted) | FY2024 (Adjusted) | Change | | :--- | :--- | :--- | :--- | | Pre-Tax Earnings | $20.8 million | $17.1 million | +21.5% | | Net Earnings | $16.0 million | $12.3 million | +29.8% | | Diluted EPS | $5.37 | $4.19 | +28.2% | | EBITDA | $26.5 million | $20.7 million | +28.4% | [Segment Performance Analysis](index=2&type=section&id=Segment%20Performance%20Analysis) The Domestic segment drove significant sales and profit growth, while the International segment saw mixed results due to project delays, and the Corporate segment reported losses from acquisition costs and the absence of prior-year benefits [Domestic Segment](index=2&type=section&id=Domestic%20Segment) The Domestic segment was the **primary growth engine** for the company in fiscal 2025. Sales surged **54.7%** in Q4 and **30.7%** for the full year, driven by higher manufacturing volumes and the strategic acquisition of Nu Aire. This top-line growth translated into **improved profitability** for both the quarter and the full year Domestic Segment Performance (in millions) | Period | Sales | % Change (YoY) | Net Earnings | % Change (YoY) | | :--- | :--- | :--- | :--- | :--- | | Q4 FY2025 | $55.5 million | +54.7% | $5.1 million | +49.5% | | Full Year FY2025 | $179.4 million | +30.7% | $15.4 million | +30.2% | - The **improvement in domestic sales and profitability** was **driven by higher manufacturing volumes and the incorporation of Nu Aire's results** following the acquisition[10](index=10&type=chunk)[19](index=19&type=chunk) [International Segment](index=2&type=section&id=International%20Segment) The International segment experienced **mixed results**. In Q4, sales increased by **3.9%** as customer site delays that had previously hampered performance began to ease, allowing for increased deliveries. However, for the full fiscal year, sales decreased by **8.2%** and profitability slightly declined, reflecting the cumulative impact of these project delays throughout the year International Segment Performance (in millions) | Period | Sales | % Change (YoY) | Net Earnings | % Change (YoY) | | :--- | :--- | :--- | :--- | :--- | | Q4 FY2025 | $21.7 million | +3.9% | $1.6 million | +41.2% | | Full Year FY2025 | $61.1 million | -8.2% | $2.9 million | -5.0% | - The full-year decrease in sales and profitability was **primarily impacted by customer site delays that pushed out the timing of deliveries and billings**[20](index=20&type=chunk) [Corporate Segment](index=2&type=section&id=Corporate%20Segment) The Corporate segment reported a **net loss** of **$1.9 million** for Q4 and **$6.9 million** for the full fiscal year, a **stark contrast** to the net earnings reported in the prior year. This was driven by a combination of factors: the **absence of significant one-time tax benefits and pension adjustments** that boosted prior-year results, and the **incurrence of new costs** in the current year related to the Nu Aire acquisition and Sarbanes-Oxley compliance readiness Corporate Segment Net Earnings (Loss) (in millions) | Period | FY2025 Net Loss | FY2024 Net Earnings | | :--- | :--- | :--- | | Q4 | ($1.9 million) | $6.5 million | | Full Year | ($6.9 million) | $3.9 million | - The variance from the prior year is due to two main factors: 1) The prior year included **large non-recurring transactions** (pension and tax benefits) 2) The current year includes **professional service fees for the Nu Aire acquisition and Sarbanes-Oxley 404(b) compliance costs**[12](index=12&type=chunk)[21](index=21&type=chunk) [Financial Condition and Management Outlook](index=2&type=section&id=Financial%20Condition%20and%20Management%20Outlook) The company's financial position reflects the Nu Aire acquisition, with increased debt and improved working capital, as management expresses confidence in continued organic and inorganic growth strategies [Working Capital and Debt](index=4&type=section&id=Working%20Capital%20and%20Debt) As of April 30, 2025, the company's financial position reflects the Nu Aire acquisition. Cash on hand decreased to **$17.2 million**, primarily to fund the transaction. Both short-term and long-term debt increased significantly, raising the debt-to-equity ratio to **0.99-to-1** from **0.70-to-1** in the prior year. Despite the higher leverage, working capital improved to **$64.7 million** Key Balance Sheet Items (as of April 30) (in millions) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Cash on Hand | $17.2 million | $25.9 million | -33.8% | | Working Capital | $64.7 million | $56.0 million | +15.4% | | Total Debt (Short & Long) | $65.5 million | $31.6 million | +107.4% | | Debt-to-Equity Ratio | 0.99-to-1 | 0.70-to-1 | Increased | - The decrease in cash and **increased** in debt were **primarily related to the completion of the Nu Aire acquisition**[22](index=22&type=chunk)[23](index=23&type=chunk) [Management Commentary and Strategic Outlook](index=2&type=section&id=Management%20Commentary%20and%20Strategic%20Outlook) Management expressed strong satisfaction with the fiscal year's "**exceptional performance**," citing a **robust backlog** and the **successful execution of its strategy**. The acquisition of Nu Aire is highlighted as a **significant step** in the company's growth journey, bringing **complementary strengths and a shared vision for laboratory innovation**. Looking ahead, Kewaunee plans to **continue pursuing both organic and inorganic growth**, leveraging its strong culture and channel partnerships - The company's strategy of **investing in its product portfolio, manufacturing assets, and dealer relationships continues to drive performance improvement and market momentum**[13](index=13&type=chunk) - The acquisition of Nu Aire, Inc. is a **key strategic move to combine two market leaders with complementary strengths and a common vision for laboratory innovation**[24](index=24&type=chunk) - Despite **industry instability from geopolitical uncertainty and supply chain disruptions**, management states Kewaunee has **responded with resilience and views uncertainty as an opportunity**[24](index=24&type=chunk) - The company expects to **continue to grow both organically and inorganically**, **positioning itself as a trusted partner for business owners looking for stewardship and continuity**[24](index=24&type=chunk)[25](index=25&type=chunk) [Financial Statements and Reconciliations](index=6&type=section&id=Financial%20Statements%20and%20Reconciliations) Detailed reconciliations of non-GAAP measures provide clarity on core operational performance, while condensed consolidated financial statements reflect significant asset and liability increases due to the Nu Aire acquisition [Reconciliation of Non-GAAP Measures](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The report provides detailed reconciliations for non-GAAP metrics, including Adjusted EBITDA and Adjusted Net Earnings. These adjustments are **crucial** for understanding the company's **core operational performance** by removing the **distorting effects** of one-time events. For fiscal 2025, adjustments primarily remove costs related to the Nu Aire acquisition. For fiscal 2024, adjustments remove the impact of a pension termination and a large valuation allowance release - The company uses non-GAAP measures like Adjusted EBITDA and Adjusted Net Earnings to provide investors with a **clearer view of business trends by excluding items like acquisition fees (FY25) and pension settlement costs (FY24)**[29](index=29&type=chunk)[30](index=30&type=chunk) FY2025 Consolidated EBITDA Reconciliation (in millions) | Metric | Amount | | :--- | :--- | | Net Earnings | $11.4 million | | Add: Interest, Taxes, D&A | $10.2 million | | **EBITDA** | **$21.6 million** | | Add: Professional & Other Fees | $4.9 million | | **Adjusted EBITDA** | **$26.5 million** | FY2025 Adjusted Net Earnings Reconciliation (in millions) | Metric | Amount | | :--- | :--- | | Net Earnings (As Reported) | $11.4 million | | Add: Professional & Other Fees (Net of Tax) | $4.6 million | | **Adjusted Net Earnings** | **$16.0 million** | [Condensed Consolidated Financial Statements](index=11&type=section&id=Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements provide the **official GAAP results**. The Statement of Operations **confirms** the **18%** year-over-year revenue growth to **$240.5 million**. The Balance Sheet **clearly shows** the impact of the Nu Aire acquisition, with **Total Assets increasing** from **$134.8 million** to **$194.7 million**, **driven by** the addition of **$17.8 million** in intangible assets and **$12.5 million** in goodwill. Correspondingly, **Total Liabilities rose** from **$78.6 million** to **$128.4 million**, **largely due to** increased long-term debt to finance the deal Condensed Consolidated Statement of Operations (Full Year) (in millions) | Metric | FY2025 | FY2024 | | :--- | :--- | :--- | | Net Sales | $240.5 million | $203.8 million | | Gross Profit | $68.9 million | $52.1 million | | Operating Profit | $17.8 million | $18.3 million | | Net Earnings Attributable to KEQU | $11.4 million | $18.8 million | Condensed Consolidated Balance Sheet (as of April 30) (in millions) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total Current Assets | $118.4 million | $96.8 million | | Total Assets | $194.7 million | $134.8 million | | Total Current Liabilities | $53.7 million | $40.8 million | | Total Liabilities | $128.4 million | $78.6 million | | Total Stockholders' Equity | $66.2 million | $56.2 million | [Company Information and Disclosures](index=9&type=section&id=Company%20Information%20and%20Disclosures) Kewaunee Scientific, a **global leader** in laboratory furniture, expanded its portfolio with the acquisition of Nu Aire, a key manufacturer of biological safety cabinets, while cautioning investors on forward-looking statements due to various market and integration risks [About Kewaunee Scientific and Nu Aire](index=9&type=section&id=About%20Kewaunee%20Scientific%20and%20Nu%20Aire) Kewaunee Scientific, founded in 1906, is a **global leader** in designing and manufacturing laboratory furniture and technical products, with headquarters in Statesville, NC, and manufacturing facilities in the US and India. Its newly acquired subsidiary, Nu Aire, founded in 1971 and based in Plymouth, MN, is a leading manufacturer of biological safety cabinets and other essential lab equipment, which complements Kewaunee's existing product portfolio - Kewaunee Scientific is a **global leader** in the design, manufacture, and installation of laboratory, healthcare, and technical furniture products, including casework, fume hoods, and modular systems[31](index=31&type=chunk) - The newly acquired subsidiary, Nu Aire, is a leading manufacturer of **complementary laboratory products** such as biological safety cabinets, CO2 incubators, and ultralow freezers[32](index=32&type=chunk) [Forward-Looking Statements](index=10&type=section&id=Forward-Looking%20Statements) This section contains a **standard safe harbor statement**, **cautioning investors** that any forward-looking statements in the press release are **subject to known and unknown risks and uncertainties**. These factors, which include economic conditions, customer demand, and risks related to the Nu Aire acquisition, **could cause actual results to differ materially from projections**. The company directs readers to its SEC filings for a **comprehensive list of risk factors** and **disclaims any obligation to update these statements** - The press release includes forward-looking statements concerning future financial conditions and results, which are **subject to significant risks and uncertainties**[34](index=34&type=chunk) - Key risks include the **ability to realize benefits from the Nu Aire acquisition**, **competitive and economic conditions**, **supply chain disruptions**, and **changes in customer demand**[34](index=34&type=chunk)

Core Viewpoint - Kewaunee Scientific Corporation reported mixed financial results for the third quarter of fiscal 2025, with significant revenue growth but a decline in profitability due to increased operating expenses and interest costs [2][3][5]. Financial Performance - Earnings per share for the third quarter were 45 cents, down 29.7% from 64 cents in the same quarter last year [2]. - Revenues increased to $67.2 million, a 43.6% rise from $46.8 million in the prior-year quarter, driven by strong domestic performance and the integration of the Nu Aire acquisition [2]. - Net earnings fell 46.3% to $1.4 million from $2.5 million in the same quarter last year [3]. Operating Expenses - Operating profit decreased 40.9% to $2.3 million from $3.8 million in the prior-year period, attributed to higher operating expenses which nearly doubled to $16.1 million, representing 24% of revenues [4]. - Interest expenses rose to $1.1 million from $411,000 in the previous year, contributing to a 63.7% decline in pre-tax earnings to $1.3 million from $3.5 million [5]. Domestic & International Segments - Domestic revenues grew 63.6% to $52 million, with net earnings increasing 9.2% to $2.9 million [6]. - International revenues were $15.2 million, up 1.2%, but faced challenges from project site delays, leading to a drop in net earnings to $476,000 [7]. Acquisition & Integration Impacts - The Nu Aire acquisition incurred $2.5 million in related costs, impacting pre-tax earnings; adjusted pre-tax earnings would have been $3.8 million, up 7.8% year over year [8]. - Adjusted EBITDA increased 29.8% to $5.7 million from $4.4 million, with adjusted diluted EPS at $1.09 compared to $0.85 last year [8]. Order Backlog & Financial Position - The order backlog increased 45.5% year over year to $221.6 million, attributed to sustained demand across various industries [10]. - Total debt rose significantly to $65.8 million from $28.5 million, driven by new debt financing related to the Nu Aire acquisition [11]. Management Commentary - CEO Thomas D. Hull III emphasized the company's focus on strengthening dealer and distribution relationships, which has driven positive momentum [12]. - The company is actively working with customers to ensure timely execution of projects once construction schedules resume [13]. Guidance & Strategic Outlook - Management reaffirmed its commitment to operational efficiency and growth initiatives, expressing confidence in the ability to capitalize on long-term market trends [14]. Other Developments - Kewaunee completed the Nu Aire acquisition on Nov. 1, 2024, enhancing its product portfolio with additional laboratory equipment [15]. - The company expanded its share repurchase program in March 2025, authorizing the repurchase of an additional 100,000 shares [16].