Kewaunee Scientific Corporation reported its financial results for the three months ended July 31, 2024, showing a decline in net sales compared to the same period in 2023. Net sales for the quarter were $48.4 million, down from $49.8 million in the prior year. Domestic sales remained relatively stable at $35.5 million, while international sales decreased by 10.7% to $12.9 million, attributed to construction site delays in India.
Despite the drop in sales, the company experienced an increase in gross profit, which rose to $12.5 million from $11.9 million, resulting in a gross profit margin of 25.8%, up from 23.9% in the previous year. This improvement was primarily driven by a favorable sales mix in domestic operations. However, operating profit fell to $2.6 million from $3.8 million, and profit before income taxes decreased to $2.4 million from $3.4 million. Net earnings attributable to Kewaunee Scientific Corporation were $2.2 million, down from $2.5 million, leading to a diluted earnings per share of $0.74 compared to $0.86 in the prior year.
Operating expenses increased to $9.9 million, representing 20.5% of sales, up from $8.1 million or 16.3% of sales in the previous year. This rise was due to higher selling, general, and administrative (SG&A) wages, consulting fees, and international operating expenses. The company reported a significant decrease in income tax expense, which fell to $192,000 from $897,000, resulting in a lower effective tax rate of 7.9% compared to 26.3% in the prior year.
Kewaunee's order backlog improved to $159.4 million as of July 31, 2024, up from $140.8 million a year earlier and $155.6 million at the end of April 2024. The company maintained a healthy cash position, with cash and cash equivalents increasing to $24.2 million from $23.3 million at the end of April 2024.
The company continues to focus on supporting its domestic dealers and distribution partners while providing turnkey solutions internationally. Kewaunee's performance is influenced by demand for laboratory construction projects and fluctuations in raw material costs. The company is well-positioned for future projects, supported by its healthy backlog and improved manufacturing capabilities.
About KEWAUNEE SCIENTIFIC CORP /DE/
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