#United States #Nu Aire #Statesville #Kewaunee Scientific #Q3 2026

Kewaunee Scientific Reports Third Quarter Results for Fiscal Year 2026

Kewaunee Scientific Corporation (NASDAQ: KEQU) announced its financial results for the third quarter ending January 31, 2026. Despite facing significant challenges, the company showed notable resilience as evidenced by its performance metrics this quarter.

Financial Highlights

During the third quarter, Kewaunee recorded sales totaling $69.4 million, marking an increase of 3.3% compared to the $67.2 million reported in the same quarter the previous year. Pre-tax earnings surged by 25.8%, reaching $1.6 million, in contrast to $1.275 million from the prior year. However, net earnings dropped to $692,000 from $1.354 million in the previous year.

The company’s performance in terms of EBITDA showed a slight increase to $3.8 million, up from $3.7 million in last year's comparable quarter. However, diluted earnings per share fell to $0.23, down from $0.45 in the same quarter last year.

The backlog of orders was reported at $183.2 million, a decrease from $221.6 million on January 31, 2025. This contrasts with $214.6 million reported on April 30, 2025.

Segment Analysis

Domestic Segment

Domestic sales for this quarter were $51.0 million, down by 2.0% from $52.0 million during the same period last year, reflecting decreased manufacturing volume in laboratory construction. The net earnings from the domestic segment were $2.3 million, compared to $2.9 million the previous year. This decline was influenced by lower manufacturing volumes and the overall market slowdown.

International Segment

Conversely, the international sales segment showcased a commendable increase to $18.4 million, rising by 21.4% from $15.2 million in the prior year. Net earnings from this segment reached $1.3 million, a significant jump from $476,000 last year, indicating successful market penetration, particularly in India, which contributed prominently to this growth.

Corporate Segment

The corporate segment, however, saw a pre-tax net loss of $3.1 million, slightly worsening from $3.0 million last year. The EBITDA deficit for this segment was ($2.3 million), consistent with the previous year’s indications, as the company continues to invest in corporate enhancements geared towards supporting strategic growth initiatives.

Cash Position and Debt

As of January 31, 2026, cash on hand diminished to $10.3 million from $17.2 million in April 2025. Working capital was slightly reduced to $54.8 million compared to $58.4 million a year earlier. The company noted an increase in short-term debt to $7.4 million, alongside a long-term debt figure showing a notable decrease to $42.3 million.

Kewaunee’s debt-to-equity ratio improved to 0.68-to-1, compared to 0.99-to-1 on April 30, 2025. Notably, when excluding the impact of the sale-leaseback transaction, its ratio was 0.31-to-1, down from 0.57-to-1 from the prior year.

Strategic Initiatives

Thomas D. Hull III, the company's President and CEO, stated, "Following the successful turnaround, we embarked on an aggressive growth strategy that led to our acquisition of Nu Aire. Our teams have worked diligently to integrate Nu Aire into our operations, setting the stage for future growth and enhanced contributions to our EBITDA."

Reflecting on the quarter, Hull acknowledged that results often tend to be softer due to seasonal trends, including the impact of holiday schedules and winter construction slowdowns. He emphasized how the acquisition of Nu Aire's containment products helped mitigate the downturn felt in other segments.

Conclusion

Kewaunee Scientific’s Q3 results illustrate a mixed picture of growth and challenges amidst ongoing economic uncertainties. The significant growth in international sales alongside investments in strategic initiatives suggests a promising outlook, potentially positioning Kewaunee for enhanced performance in the coming quarters. As the company continues to adapt, the focus remains on stabilizing the domestic segment while leveraging international expansion for sustained growth.