Core Viewpoint - Kewaunee Scientific Corporation has demonstrated resilience in its domestic operations despite facing challenges in international markets, with a strong order backlog indicating potential for future growth [12][16]. Financial Performance - The company reported second-quarter fiscal 2025 earnings per share of $1.01, an 8.6% increase from 93 cents in the same quarter last year [2]. - Net sales for the second quarter were $47.8 million, reflecting a 5.3% decline compared to $50.4 million in the prior year [2]. - Gross profit increased to $14 million from $13.5 million, resulting in a gross margin improvement to 29.2% from 26.7% [7]. Segment Analysis - Domestic sales grew 6.5% year over year to $36.41 million, with net earnings surging 48.2% to $4.52 million [4]. - International revenues fell sharply to $11.36 million, down from $16.25 million, primarily due to delays in customer construction sites in India [5]. - The corporate segment reported a pre-tax net loss of $2.44 million, widening from a $1.24 million loss in the previous year [6]. Key Business Metrics - Operating profit for the quarter was $4.4 million, a 13.2% decline from $5.1 million in the prior year [7]. - Pre-tax earnings decreased by 18.9% to $3.9 million, while EBITDA declined 13.8% to $4.9 million [8]. - Adjusted EBITDA reached $6.4 million, up 13.4% from $5.7 million in the prior year [8]. Cash and Debt Position - The company ended the quarter with $29.7 million in cash, an increase from $25.9 million [9]. - Short-term debt was reduced to $805,000 from $3.1 million, indicating improved liquidity [9]. - Long-term debt stood at $28 million, slightly down from $28.5 million, with a debt-to-equity ratio improving to 0.59-to-1 from 0.70-to-1 [10][11]. Management Commentary - The CEO highlighted strong domestic performance and a growing backlog, attributing this to market vitality and effective partnerships [12]. - Challenges in international operations were acknowledged, particularly in India, but optimism about long-term global opportunities was expressed [12]. Order Backlog - The order backlog reached a record $184.4 million, up 26% from $146.3 million a year earlier, indicating strong market demand [13]. Acquisition Strategy - The acquisition of Nu Aire, Inc. was completed on Nov. 1, 2024, aimed at enhancing the product portfolio and expanding market presence [15]. - Acquisition-related expenses of $2.3 million were recorded, viewed as a long-term investment in growth [15][16].
Kewaunee Scientific's Q2 Earnings Rise Y/Y Despite Sales Decline