Core Viewpoint - Kewaunee Scientific Corporation has successfully refinanced its debt and fully repaid its Seller Notes ahead of schedule, reflecting strong financial performance and strategic capital management [2][4]. Debt Refinancing - The company repaid its Seller Notes, which had an original outstanding principal balance of $23.0 million, ahead of the November 1, 2027 maturity date [2]. - This repayment was partially funded by a $10.0 million term loan from PNC Bank and the use of available funds from its revolving line of credit [2][3]. Financial Impact - The refinancing has led to a reduction in the overall debt load and a decrease in the effective interest rate on the company's debt portfolio, which is expected to lower future interest expenses [3][4]. - The company attributes its ability to repay the Seller Notes early to consistent financial performance from its legacy business and contributions from the newly acquired Nu Aire business [4]. Strategic Positioning - The refinancing provides the company with flexibility to execute key strategic initiatives aimed at driving future organic and inorganic growth, ultimately generating value for shareholders [4]. 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 [5]. - The company operates manufacturing facilities in Statesville, North Carolina, and Bangalore, India, serving both domestic and international markets [5]. - The newly acquired subsidiary, Nu Aire, specializes in laboratory products such as biological safety cabinets and CO2 incubators, complementing Kewaunee's existing portfolio [5].

Core Point - The costs associated with the "Unaffordability Five" — housing, food, healthcare, child care, and energy — have been increasing prior to the onset of Trump's trade war [1] Group 1: Rising Costs - Housing costs have been on the rise, contributing to overall unaffordability [1] - Food prices have also seen an upward trend, impacting household budgets [1] - Healthcare expenses have escalated, adding financial strain on families [1] - Child care costs have increased, making it difficult for parents to manage expenses [1] - Energy prices have risen, further exacerbating the affordability crisis [1]

Financial Data and Key Metrics Changes - For fiscal year 2025, revenue reached $836 million, representing a 14% year-over-year growth, exceeding the raised guidance range [5][17] - Adjusted EBITDA for the year was $126.5 million, after strategic growth investments of $6.5 million [5][17] - Consolidated net income for the fourth quarter was $18.8 million, or $0.34 per diluted share, and for the full year, it was $63 million, or $1.13 per diluted share [17][18] Business Line Data and Key Metrics Changes - The Concorde division saw a 14.5% increase in both average full-time active students and new student starts for fiscal 2025 [16] - The UTI division experienced an 8% increase in average full-time active students and a 7.9% growth in new student starts [16] - Average full-time active students for the full year increased by 10.5% to 24,618, while new student starts rose by 10.8% to 29,793 [16] Market Data and Key Metrics Changes - The demand for skilled trades and healthcare careers remains strong, with new student starts expected to range between 31,500 and 33,000 for fiscal 2026 [10][20] - The company plans to open three new campuses in fiscal 2026, expanding its reach in fast-growing metropolitan areas [8][9] Company Strategy and Development Direction - The company is in the second phase of its North Star strategy, focusing on growth, diversification, and optimization, with plans to launch approximately 20 new programs in fiscal 2026 [4][9] - The operational priorities for fiscal 2026 include expanding campus footprint, launching new programs at scale, and growing the student base while maintaining quality [8][10] - The company anticipates generating over $1.2 billion in annual revenue and approaching $220 million in adjusted EBITDA by fiscal 2029 [13][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's operational and financial position, indicating that fiscal 2026 will be a year of investment and expansion [14][20] - The company expects revenue growth to average about 10% over the next several years, with strategic investments leading to margin expansion starting in 2027 [12][24] - Management noted that the demand for skilled trades is intensifying, with significant opportunities in various sectors [46][50] Other Important Information - The company faced temporary delays in cash disbursements due to the Department of Education's verification process, but this is expected to normalize soon [19][29] - The company plans to invest approximately $100 million annually in capital expenditures to support campus growth and modernization [24][23] Q&A Session Summary Question: What are the expectations for start growth in 2026 between UTI and Concorde segments? - Management expects roughly 8-9% start growth for 2026, similar to the previous year [27] Question: Clarification on campus openings? - The company clarified that the expectation is to open between two and five campuses annually across both divisions [28] Question: Impact of Department of Education's ID verification measures? - Management confirmed no impact on front-end productivity, with only temporary delays in cash collection [29] Question: How did high school recruiting efforts perform? - High school recruiting met expectations, with plans to add resources for 2026 [30] Question: Tuition increases for 2026? - The company anticipates a 2-3% price increase, varying by program and market [32] Question: Revenue potential of new campuses? - Salt Lake City is expected to generate $40-45 million in revenue at peak, similar to Atlanta [38][42] Question: Employment trends across programs? - Demand for graduates remains strong, with no signs of slowdown in employment opportunities [46]

Financial Data and Key Metrics Changes - Adjusted EPS for Q1 was $0.193, an 18% increase compared to the previous year, exceeding the midpoint of guidance [6][10] - EBIT for the quarter was $687 million, up approximately 4% on a comparable basis, with an EBIT margin of 12%, which is 110 basis points higher than the previous year [11][10] - Free cash outflow for Q1 was $343 million, representing a year-over-year improvement of over $160 million prior to acquisition-related costs [20][21] Business Line Data and Key Metrics Changes - In the global flexible packaging solutions segment, net sales increased by 25% on a constant currency basis, primarily due to the Berry acquisition, but were down 2% on a comparable basis [16] - Adjusted EBIT for the flexible packaging segment rose 28% on a constant currency basis to $426 million, driven by acquired earnings [17] - In the global rigid packaging solutions segment, net sales increased by 205% on a constant currency basis, but were lower than the prior year on a comparable basis due to a 1% volume decline [18][19] Market Data and Key Metrics Changes - Emerging markets performed better than developed markets, with solid growth in Asia, while developed markets saw low single-digit declines [10][16] - Demand in North America and Europe was down low single digits, with volumes in emerging markets remaining in line with last year [16] Company Strategy and Development Direction - The company is focused on delivering core business execution, integrating Berry, realizing synergies, and optimizing its portfolio [7][9] - The board approved an increase in the quarterly dividend to $0.13 per share, reflecting confidence in cash flow generation [9][30] - The company anticipates at least $260 million in synergies for fiscal 2026, with a total of $650 million expected through fiscal 2028 [8][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering strong earnings and free cash flow growth, independent of macroeconomic improvements [9][22] - The company expects EPS growth of 12%-17% for fiscal 2026, supported by synergy realization [22][30] - Management acknowledged challenges in consumer affordability impacting certain categories, particularly in Europe [35][42] Other Important Information - The company has identified non-core assets and entered agreements to sell two businesses for approximately $100 million [8][9] - The CFO announced his departure, with a new CFO set to join, indicating a transition in leadership [13][14] Q&A Session Summary Question: Concerns about volume decline in flexible business - Management noted that volumes were expected to be similar to Q4, with a specific weakness in the unconverted film category in Europe due to general market softness [35][36] Question: Update on North American beverage business - Management reported good operational progress and increased profitability, while exploring strategic alternatives for the non-core beverage business [38][39] Question: Volume performance in high-growth categories - Management indicated that focus categories generally performed better than the overall business, with strong growth in pet care and dairy [41][42] Question: Synergy benefits from combining businesses - Management highlighted that synergies are being realized, with a strong pipeline building, particularly in Latin America [51][54] Question: Update on private label products - Management acknowledged underrepresentation in private label markets and plans to drive additional growth in this area [75][76] Question: Healthcare business performance - Management expressed confidence in the healthcare segment, expecting continued improvement into calendar 2026 [80]

Core Insights - Lincoln Educational Services Corporation's campuses in Melrose Park, IL and South Plainfield, NJ have been recognized as "America's Top Vocational Schools" for 2025 by USA Today, highlighting their commitment to student success and diversity [1][2] Group 1: Recognition and Commitment - The recognition as a top vocational school reflects Lincoln Tech's dedication to training essential workers in vital industries such as transportation, skilled trades, and healthcare support [2] - The award emphasizes Lincoln Tech's commitment to excellence in hands-on education, career readiness, and workforce development, with graduates acquiring high-demand skills that lead to employment opportunities [3][9] Group 2: Evaluation Criteria - The evaluation by USA Today and Statista was based on five main criteria: graduation rate, graduate salaries, diversity within the student body, anticipated years to pay off a program, and social mobility [2] - This is the inaugural year for USA Today to publish this list, indicating a new benchmark for vocational education recognition [2] Group 3: Campus Performance - The Melrose Park campus, established in 1902, reported that 75% of its graduates were hired in their field last year, with over 700 students graduating [3] - The South Plainfield campus also demonstrated strong hiring rates for graduates of its Diesel Service Technology, Heavy Equipment Technology, and Welding Technology programs, with nearly 200 students completing their training last year [4] Group 4: Company Overview - Lincoln Educational Services Corporation has been a leader in diversified career-oriented post-secondary education since 1946, offering programs in transportation, healthcare, skilled trades, and information technology [5][6] - The company operates 21 campuses across 12 states under three brands: Lincoln College of Technology, Lincoln Technical Institute, and Nashville Auto-Diesel College [6]