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What changed in KEWAUNEE SCIENTIFIC CORP /DE/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of KEWAUNEE SCIENTIFIC CORP /DE/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+162 added−114 removedSource: 10-K (2025-07-02) vs 10-K (2024-06-28)

Top changes in KEWAUNEE SCIENTIFIC CORP /DE/'s 2025 10-K

162 paragraphs added · 114 removed · 92 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

20 edited+11 added−2 removed5 unchanged
Biggest changeOn average, payments for our products are received during the quarter following shipment, with the exception of the retention amounts which are collected at the final completion of the project. 3 Table of Contents We hold various patents and patent rights, but do not consider that our success or growth is dependent upon our patents or patent rights.
Biggest changeWe hold various patents and patent rights, but do not consider that our success or growth is dependent upon our patents or patent rights. Our business is not dependent upon licenses, franchises, concessions, trademarks, royalty agreements, or labor contracts.
Sales for two of the Company's domestic dealers and our national stocking distributor represented, in the aggregate, approximately 42% and 35% of the Company's sales in fiscal years 2024 and 2023, respectively. Loss of all or part of our sales to a large customer would have a material effect on our financial operations.
Sales for two of the Company's domestic dealers and our national stocking distributor represented, in the aggregate, approximately 41% and 42% of the Company's sales in fiscal years 2025 and 2024, respectively. Loss of all or part of our sales to a large customer would have a material effect on our financial operations.
Our order backlog at April 30, 2024 was $155.6 million, as compared to $147.9 million at April 30, 2023. Based on scheduled shipment dates and past experience, we estimate that not less than 88% of our order backlog at April 30, 2024 will be shipped during fiscal year 2025.
Our order backlog at April 30, 2025 was $214.6 million, as compared to $155.6 million at April 30, 2024. Based on scheduled shipment dates and past experience, we estimate that not less than 93% of our order backlog at April 30, 2025 will be shipped during fiscal year 2026.
However, it may be expected that delays in shipments will occur because of customer rescheduling or delay in completion of projects which involve the installation of our products.
However, it may be expected that delays in shipments will occur because of customer rescheduling or delay in completion of projects which involve the installation of our products. ACQUISITION OF NU AIRE The Company completed the acquisition of Nu Aire on November 1, 2024.
Our business is not dependent upon licenses, franchises, concessions, trademarks, royalty agreements, or labor contracts. Our business is not generally cyclical, although domestic sales are sometimes lower during our third quarter because of slower construction activity in certain areas of the country during the winter months.
Our business is not generally cyclical, although domestic sales are sometimes lower during our third quarter because of slower construction activity in certain areas of the country during the winter months.
Our need for working capital and our credit practices are comparable to those of other companies manufacturing, selling and installing similar products in similar markets.
Such materials and products are purchased from multiple suppliers and are typically readily available. Our need for working capital and our credit practices are comparable to those of other companies manufacturing, selling and installing similar products in similar markets.
Our people are critical for our continued success, so we work hard to create an environment where employees can have fulfilling careers, and be happy, healthy, and productive.
Our people are critical for our continued success, so we work hard to create an environment where employees can have fulfilling careers, and be happy, healthy, and productive. We offer competitive benefits and programs to take care of the diverse needs of our employees and their families.
CULTURE AND WORKFORCE We are a company of passionate, talented, and motivated people. We embrace collaboration and creativity, and encourage the iteration of ideas to address complex challenges in technology and society. At April 30, 2024, the Company had 556 Domestic employees and 450 International employees.
CULTURE AND WORKFORCE We are a company of passionate, talented, and motivated people. We embrace collaboration and creativity, and we encourage the iteration of ideas to address complex challenges within our industry and society. At April 30, 2025, the Company had 793 Domestic employees, including the recent Nu Aire acquisition, and 446 International employees.
Our competitive compensation programs help us to attract and retain top candidates, and we will continue to invest in recruiting talented people to technical and non-technical roles, and rewarding them well. The Company believes that open and honest communication among team members, managers, and leaders helps create a collaborative work environment where everyone can contribute, grow, and succeed.
We will continue to invest in recruiting talented people to technical and non-technical roles, and celebrate their contributions with comprehensive rewards and recognition. The Company believes that open and honest communication among team members, managers, and leaders helps create a collaborative work environment where everyone can contribute, grow, and succeed.
SEGMENT INFORMATION See Note 12 , Segment Information , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for information concerning our Domestic and International business segments.
See Note 4 , Nu Aire Acquisition , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for information concerning the nature and terms of the acquisition.
The primary raw materials and products manufactured by others and used by us in our products are cold-rolled carbon and stainless steel, hardwood lumber and plywood, paint, chemicals, resins, hardware, plumbing and electrical fittings. Such materials and products are purchased from multiple suppliers and are typically readily available.
The impact of such possible increases is considered when determining the sales price. The primary raw materials and products manufactured by others and used by us in our products are cold-rolled carbon and stainless steel, hardwood lumber and plywood, paint, chemicals, resins, hardware, plumbing and electrical fittings.
Since prices are normally quoted on a firm basis in the industry, we bear the burden of possible increases in labor and material costs between quotation of an order and delivery of the product. The impact of such possible increases is considered when determining the sales price.
Changes or delays in building construction may cause delays in delivery of the orders and our recognition of the sale. Since prices are normally quoted on a firm basis in the industry, we bear the burden of possible increases in labor and material costs between quotation of an order and delivery of the product.
EXECUTIVE OFFICERS OF THE REGISTRANT Included in Part III, Item 10(b) , Directors, Executive Officers and Corporate Governance , of this Annual Report on Form 10-K.
The reference to our website does not constitute incorporation by reference of any information contained at that site. EXECUTIVE OFFICERS OF THE REGISTRANT Included in Part III, Item 10(b) , Directors, Executive Officers and Corporate Governance , of this Annual Report on Form 10-K.
In addition, payment terms associated with certain projects provide for a retention amount until final completion of the project, thus also increasing required working capital.
In addition, payment terms associated with certain projects provide for a retention amount until final completion of the project, thus also increasing required working capital. On average, payments for our products 3 Table of Contents are received during the quarter following shipment, with the exception of the retention amounts which are collected at the final completion of the project.
It is common in the laboratory and healthcare furniture industries for customer orders to require delivery at extended future dates, as products are frequently installed in buildings yet to be constructed. Changes or delays in building construction may cause delays in delivery of the orders and our recognition of the sale.
We consider the markets in which we compete to be highly competitive, with a significant amount of the business involving competitive public bidding. It is common in the laboratory and healthcare furniture industries for customer orders to require delivery at extended future dates, as products are frequently installed in buildings yet to be constructed.
We offer competitive benefits and programs to take care of the diverse needs of our employees and their families, including opportunities for career growth and development, resources to support their financial health, and access to excellent healthcare choices and resources, including access to an onsite medical clinic and separate gym facility and regular access to onsite specialists.
These include opportunities for career growth and development, resources to support their financial health, and access to excellent healthcare choices and resources, including an onsite medical clinic and separate gym facility at Kewaunee's Statesville, NC headquarters, as well as regular access to onsite specialists. Our competitive compensation programs help us attract and retain top candidates.
RESEARCH AND EXPERIMENTATION EXPENDITURES The amount spent and expensed by us during the fiscal year ended April 30, 2024 on research and experimentation expenditures activities related to new or redesigned products was $920,000. The amount spent for similar purposes in the fiscal year ended April 30, 2023 was $1,012,000.
A significant portion of our business is based upon competitive public bidding. 4 Table of Contents RESEARCH AND EXPERIMENTATION EXPENDITURES The amount spent and expensed by us during the fiscal year ended April 30, 2025 on research and experimentation expenditures activities related to new or redesigned products was $919,000.
COMPETITION We consider the industries in which we participate to be highly competitive and believe that the principal deciding factors are price, product performance, and customer service. A significant portion of our business is based upon competitive public bidding.
See Note 14 , Segment Information , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for further segment financial data. COMPETITION We consider the industries in which we participate to be highly competitive and believe that the principal deciding factors are price, product performance, and customer service.
Our 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. Our products are sold primarily through purchase orders and contracts submitted by customers through our dealers, our subsidiaries in Singapore and India, and a national distributor.
Our 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. Our acquisition, discussed below, of Nu Aire, Inc. ("Nu Aire") complements Kewaunee Scientific's existing portfolio through Nu Aire's biological safety cabinets, CO2 incubators, ultralow freezers, and other essential laboratory products.
Products are sold principally to pharmaceutical, biotechnology, industrial, chemical and commercial research laboratories, educational institutions, healthcare institutions, governmental entities, and manufacturing facilities. We consider the markets in which we compete to be highly competitive, with a significant amount of the business involving competitive public bidding.
Our products are sold primarily through purchase orders and contracts submitted by customers directly or through our dealers, our subsidiaries in Singapore and India, and a national distributor. Products are sold principally to pharmaceutical, biotechnology, industrial, chemical and commercial research laboratories, educational institutions, healthcare institutions, governmental entities, and manufacturing facilities.
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OTHER INFORMATION Our Internet address is www.kewaunee.com . We make available, free of charge through this website, our annual report to stockholders. Our Form 10-K and 10-Q financial reports may be obtained by stockholders by writing the Secretary of the 4 Table of Contents Company, Kewaunee Scientific Corporation, P.O. Box 1842, Statesville, NC 28687-1842.
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Our International subsidiaries, as identified in Note 1 , Summary of Significant Accounting Policies , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on 10-K, provide products and services, including facility design, detailed engineering construction, and project management from the planning stage through testing and commissioning of laboratories.
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The public may also obtain information on our reports, proxy, and information statements at the Securities and Exchange Commission ("SEC") Internet site www.sec.gov . The reference to our website does not constitute incorporation by reference of any information contained at that site.
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Nu Aire is renowned for its manufacturing of biological safety cabinets, airflow products, CO2 incubators, ultralow freezers, animal handling equipment, pharmacy compounding isolators, and related parts and accessories. Their products serve a diverse range of industries, including life sciences, healthcare, pharmacy, education, food and beverage, and industrial sectors.
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The acquisition of Nu Aire presents a unique opportunity for the Company to combine its robust capabilities with a recognized market leader whose product portfolio and well-developed channel strategy complement the Company's existing offerings. The acquisition also expands the Company's capabilities, allowing the combined organization to better meet the diverse needs of end-users in laboratory furnishings.
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Additionally, Nu Aire has established distribution partners in regions where the Company has not previously had a presence, accelerating the Company's vision of becoming the market leader in the design and manufacturing of laboratory furniture and technical products essential for outfitting laboratories.
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SEGMENT INFORMATION Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker ("CODM"), or decision-making group, in deciding how to allocate resources and in assessing performance. The Company's Chief Executive Officer ("CEO") is the Company's CODM.
Added
In accordance with ASC 280, Segment Reporting , the Company determined that the CODM assesses the Company's operations and manages its businesses in two segments: Domestic and International. The Domestic segment consists of the Company's operations based out of Statesville, North Carolina and Kewaunee's subsidiary, Nu Aire, Inc., based out of Plymouth, Minnesota.
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The International segment consists of the foreign subsidiaries identified in Note 1 , Summary of Significant Accounting Policies , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. We measure our segment profitability based on earnings before income taxes.
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Some Corporate expenses, such as those related to executive management, finance, etc., are allocated to the segments. Any non-allocated Corporate costs are shown separately in our segment reporting as presented in Note 14 , Segment Information , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
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The amount spent for similar purposes in the fiscal year ended April 30, 2024 was $920,000.
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OTHER INFORMATION We file annual, quarterly, and current reports and other information with the Securities and Exchange Commission (the "SEC"). The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Our Internet address is www.kewaunee.com .
Added
We make available, free of charge through this website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

28 edited+34 added−4 removed58 unchanged
Biggest changeRisks Specific to our Company If we lose a large customer, our sales and profits would decline. We have substantial sales to three of our domestic channel partners. The combined sales to two dealers and our national stocking distributor accounted for approximately 42% of our sales in fiscal year 2024.
Biggest changeWe do not undertake to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future. 5 Table of Contents Risks Specific to our Company If we lose a large customer, our sales and profits would decline. We have substantial sales to three of our domestic channel partners.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry of the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties, other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems.
If we cannot purchase sufficient products at competitive prices and of sufficient quality on a timely enough basis to meet increasing demand, we may not be able to satisfy market demand, product shipments may be delayed, our costs may increase, or we may breach out contractual commitments and incur liabilities.
If we cannot purchase sufficient products at competitive prices and of sufficient quality on a timely enough basis to meet increasing demand, we may not be able to satisfy market demand, product shipments may be delayed, our costs may increase, or we may breach our contractual commitments and incur liabilities.
If we are unable to retain or motivate key personnel, hire qualified personnel, or maintain and continue to adapt our corporate culture, we may not be able to grow or operate effectively. Our performance largely depends on the talents and efforts of our Associates.
We rely on the talents and efforts of key management and our Associates. If we are unable to retain or motivate key personnel, hire qualified personnel, or maintain and continue to adapt our corporate culture, we may not be able to grow or operate effectively. Our performance largely depends on the talents and efforts of our Associates.
Such failures or disruptions can adversely impact our business by, among other things, 5 Table of Contents preventing access to our cloud-based systems, interfering with customer transactions or impeding the manufacturing and shipping of our products. These events could materially adversely affect our business, reputation, results of operations and financial condition.
Such failures or disruptions can adversely impact our business by, among other things, preventing access to our cloud-based systems, interfering with customer transactions or impeding the manufacturing and shipping of our products. These events could materially adversely affect our business, reputation, results of operations and financial condition.
Our business and reputation are impacted by information technology system failures and network disruptions. We, and our global supply chain, are exposed to information technology system failures or network disruptions caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins, ransomware or other cybersecurity incidents, or other events or disruptions.
We, and our global supply chain, are exposed to information technology system failures or network disruptions caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins, ransomware or other cybersecurity incidents, or other events or disruptions.
We are unable to predict the likely occurrence or duration of these adverse economic conditions and the impact these events may have on our operations and the end users who purchase our products. Our future growth may depend on our ability to penetrate new international markets.
We are unable to predict the likely occurrence or duration of these adverse economic conditions and the impact these events may have on our operations and the end users who purchase our products. 9 Table of Contents Our future growth may depend on our ability to penetrate new international markets.
If we are unable to manufacture our products consistently, in sufficient quantities, and on a timely basis, our revenues, gross margins, and our other operating results will be materially and adversely affected. 7 Table of Contents Disruptions in the financial markets have historically created, and may continue to create, uncertainty in economic conditions that may adversely affect our customers and our business.
If we are unable to manufacture our products consistently, in sufficient quantities, and on a timely basis, our revenues, gross margins, and our other operating results will be materially and adversely affected. Disruptions in the financial markets have historically created, and may continue to create, uncertainty in economic conditions that may adversely affect our customers and our business.
Risks Related to Operations Sales to customers outside the United States or with international operations expose us to risks inherent in international sales. During fiscal year 2024, 33% of our revenues were derived from sales outside of the United States. A key element of our growth strategy is to expand our worldwide customer base and our international operations.
Risks Related to Operations Sales to customers outside the United States or with international operations expose us to risks inherent in international sales. During fiscal year 2025, 29% of our revenues were derived from sales outside of the United States. A key element of our growth strategy is to expand our worldwide customer base and our international operations.
Numerous factors beyond our control, such as general economic conditions, competition, worldwide demand, labor costs, energy costs, and import duties and other trade restrictions, influence prices for our raw materials.
Numerous factors beyond our control, such as general economic conditions, competition, worldwide demand, labor costs, energy costs, and import duties and 8 Table of Contents other trade restrictions, influence prices for our raw materials.
Legal and Regulatory Compliance Risks Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business and results of operations.
Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business and results of operations.
Item 1B. Unresolved Staff Comments Not Applicable. 10 Table of Contents
Item 1B. Unresolved Staff Comments Not Applicable. 12 Table of Contents
We face a variety of competition in all of the markets in which we participate. Competitive pricing, including price competition or the introduction of new products, could have material adverse effects on our revenues and profit margins. Our ability to compete effectively depends to a significant extent on the specification or approval of our products by architects, engineers, and customers.
Competitive pricing, including price competition or the introduction of new products, could have material adverse effects on our revenues and profit margins. Our ability to compete effectively depends to a significant extent on the specification or approval of our products by architects, engineers, and customers.
Any failure, or perceived failure, by us to adhere to any public statements or initiatives, comply with federal, state or international environmental social and governance laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us and could materially adversely affect the Company's business reputation, results of operations, financial condition, and stock price. 8 Table of Contents General Risks Our stock price is likely to be volatile and could drop.
Any failure, or perceived failure, by us to adhere to any public statements or initiatives, comply with federal, state or international environmental social and governance laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us and could materially adversely affect the Company's business reputation, results of operations, financial condition, and stock price.
Further, should any key employees become ill during the course of a future health event and be unable to work, our ability to operate our internal controls may be adversely impacted. 9 Table of Contents Additional factors related to major public health issues that could have material and adverse effects on our ability to successfully operate include, but are not limited to, the following: • The effectiveness of any governmental and non-governmental organizations in combating the spread and severity, including any legal and regulatory responses; • A general decline in business activity, especially as it relates to our customers' expansion or consolidation activities; • The destabilization of the financial markets, which could negatively impact our customer growth and access to capital, along with our customers' ability to make payments for their purchase orders; and • Severe disruptions to and instability in the global financial markets, and deterioration in credit and financing conditions, which could affect our access to capital necessary to fund business operations or current investment and growth strategies.
Additional factors related to major public health issues that could have material and adverse effects on our ability to successfully operate include, but are not limited to, the following: • The effectiveness of any governmental and non-governmental organizations in combating the spread and severity, including any legal and regulatory responses; • A general decline in business activity, especially as it relates to our customers' expansion or consolidation activities; • The destabilization of the financial markets, which could negatively impact our customer growth and access to capital, along with our customers' ability to make payments for their purchase orders; and • Severe disruptions to and instability in the global financial markets, and deterioration in credit and financing conditions, which could affect our access to capital necessary to fund business operations or current investment and growth strategies.
The effects of geopolitical instability, including as a result of Russia's invasion of Ukraine, may adversely affect us and heighten significant risks and uncertainties for our business, with the ultimate impact dependent on future developments, which are highly uncertain and unpredictable.
The effects of geopolitical instability may adversely affect us and heighten significant risks and uncertainties for our business, with the ultimate impact dependent on future developments, which are highly uncertain and unpredictable.
Our international expansion efforts may not be successful in creating further demand for our products outside of the United States or in effectively selling our products in the international markets we enter. 6 Table of Contents If we fail to compete effectively, our revenue and profit margins could decline.
Our international expansion efforts may not be successful in creating further demand for our products outside of the United States or in effectively selling our products in the international markets we enter. If we fail to compete effectively, our revenue and profit margins could decline. We face a variety of competition in all of the markets in which we participate.
We purchase materials, components, and equipment from third parties for use in our manufacturing operations. Our results of operations could be adversely impacted if we are unable to adjust our purchases to reflect changes in customer demand and market fluctuations. Suppliers may extend lead times, limit supplies, or increase prices.
Our results of operations could be adversely impacted if we are unable to adjust our purchases to reflect changes in customer demand and market fluctuations. Suppliers may extend lead times, limit supplies, or increase prices.
The adoption and expansion of trade restrictions, the occurrence of a trade war, or other governmental action related to tariffs or trade agreements or policies has the potential to adversely impact demand for our products, our costs, our customers, our suppliers, and the U.S. economy, which in turn could have a material adverse effect on our business, financial condition and results of operations.
The adoption and expansion of trade restrictions, the occurrence of a trade war, or other governmental action related to tariffs or trade agreements or policies has the potential to adversely impact demand for our products, our costs, our customers, our suppliers, and the U.S. economy, which in turn could have a material adverse effect on our business, financial condition and results of operations. 10 Table of Contents Expectations related to environmental, social, and governance ("ESG") considerations could expose us to potential liabilities, increased costs, and reputational harm.
With the constant evolution of workforce dynamics, if we do not manage these changes effectively, it could materially adversely affect our culture, reputation, and operational flexibility.
With the constant evolution of workforce dynamics, if we do not manage these changes effectively, it could materially adversely affect our culture, reputation, and operational flexibility. Our business and reputation are impacted by information technology system failures and network disruptions.
In addition, the program could affect the trading price of our Common Stock and increase volatility, and any announcement of a termination of this program may result in a decrease in the trading price of our Common Stock.
In addition, the program could affect the trading price of our Common Stock and increase volatility, and any announcement of a termination of this program may result in a decrease in the trading price of our Common Stock. We may not be able to realize the benefits anticipated as a result of the Nu Aire acquisition.
The sweeping nature of pandemics makes it extremely difficult to predict how and to what extent our business and operations could be affected in the long run. Our workforce, and the workforce of our vendors, service providers, and counterparties, could be affected by a pandemic, which could result in an adverse impact on our ability to conduct business.
Our workforce, and the workforce of our vendors, service providers, and counterparties, could be affected by a pandemic, which could result in an adverse impact on our ability to conduct business.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 7 Table of Contents We have recorded goodwill and other intangible assets in connection with the Nu Aire business acquisition.
Expectations related to environmental, social, and governance ("ESG") considerations could expose us to potential liabilities, increased costs, and reputational harm. We are subject to laws, regulations, and other measures that govern a wide range of topics, including those related to matters beyond our core products and services.
We are subject to laws, regulations, and other measures that govern a wide range of topics, including those related to matters beyond our core products and services.
Loss of all or a part of our sales to a large channel partner would have a material effect on our revenues and profits until an alternative channel partner could be developed. We rely on the talents and efforts of key management and our Associates.
The combined sales to two dealers and our national stocking distributor accounted for approximately 41% of our sales in fiscal year 2025. Loss of all or a part of our sales to a large channel partner would have a material effect on our revenues and profits until an alternative channel partner could be developed.
Our actual results could differ materially from those forward-looking statements as a result of many factors, including those more fully described below and elsewhere in our public reports. We do not undertake to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.
Our actual results could differ materially from those forward-looking statements as a result of many factors, including those more fully described below and elsewhere in our public reports.
Declines in construction activity or demand for our products could materially and adversely affect our business and financial condition. We face numerous manufacturing and supply chain risks. In addition, our reliance upon sole or limited sources of supply for certain materials, components, and services could cause production interruptions, delays and inefficiencies.
In addition, our reliance upon sole or limited sources of supply for certain materials, components, and services could cause production interruptions, delays and inefficiencies. We purchase materials, components, and equipment from third parties for use in our manufacturing operations.
Additionally, we expect to continue to make investments in our information technology infrastructure. The implementation of these investments may be more costly or take longer than we anticipate, or could otherwise adversely affect our business operations, which could negatively impact our financial position, results of operations or cash flows.
The implementation of these investments may be more costly or take longer than we anticipate, or could otherwise adversely affect our business operations, which could negatively impact our financial position, results of operations or cash flows. 6 Table of Contents We cannot guarantee that our share repurchase program will enhance long-term stockholder value, or that it will successfully mitigate the dilutive effect of employee equity awards.
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We cannot guarantee that our share repurchase program will enhance long-term stockholder value, or that it will successfully mitigate the dilutive effect of employee equity awards.
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Additionally, we expect to continue to make investments in our information technology infrastructure.
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In response to the military conflict between Russia and Ukraine that began in February 2022, the United States and other North Atlantic Treaty Organization member states, as well as non-member states, announced targeted economic sanctions on Russia.
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On November 1, 2024, we completed the acquisition of Nu Aire. The success of this acquisition will depend, in part, on our ability to realize the anticipated business opportunities and growth prospects from combining Nu Aire with our existing business.
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The long-term impact on our business resulting from the disruption of trade in the region caused by the conflict and associated sanctions and boycotts is uncertain at this time due to the fluid nature of the ongoing military conflict and response.
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Achieving those benefits depends on the timely, efficient, and successful execution of a number of post-acquisition events, including integrating the acquired business into the Company.
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The potential impacts include supply chain and logistics disruptions, financial impacts including volatility in foreign exchange and interest rates, increased inflationary pressure on raw materials and energy, and other risks, including an elevated risk of cybersecurity threats and the potential for further sanctions.
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Factors that could affect our ability to achieve these benefits include: • Difficulties in integrating and managing personnel, financial reporting, and other systems used by the acquired business; • The failure of the acquired business to perform in accordance with our expectations; • Failure to achieve anticipated synergies between our business units and the business units of the acquired business; • The loss of customers of the acquired business; • The loss of key managers and employees of the acquired business; or • Other material adverse events in the acquired business.
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The process of integrating Nu Aire into our existing operations also may require additional financial resources and attention from management that would otherwise be available for ongoing development or expansion of our existing operations.
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Costs associated with the acquisition have included and may include in the future significant transaction, consulting, and third-party service fees as we build up internal resources and/or engage third party providers as part of the integration of Nu Aire into our operations.
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Further, because Nu Aire was a private company and was not subject to the requirements of Sarbanes-Oxley, the Nu Aire acquisition requires or will require us to incorporate additional internal controls for the acquired company, which may be difficult, costly, and time-consuming.
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Although we expect to successfully integrate Nu Aire, we may not achieve the desired net benefit in the timeframe planned if the integration process takes longer than expected or is more costly than anticipated. If the acquired company does not operate as we anticipate, it could materially impact our business, financial condition, and results of operations.
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We have recently acquired Nu Aire, which was not subject to rules and regulations promulgated under the Sarbanes-Oxley Act of 2002, as amended ("Sarbanes-Oxley"), and may therefore lack the internal controls that would be required of a U.S. public company, which could ultimately affect our ability to ensure compliance with the requirements of Section 404 of Sarbanes-Oxley.
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We have recently acquired Nu Aire, Inc., which was not previously subject to the rules and regulations promulgated under Sarbanes-Oxley and accordingly was not required to establish and maintain an internal control infrastructure meeting the standards promulgated under Sarbanes-Oxley.
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Our assessment of and conclusion on the effectiveness of our internal control over financial reporting as of April 30, 2025 does not include consideration of the controls of Nu Aire, which was acquired on November 1, 2024.
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Although management will continue to review and evaluate the effectiveness of our internal controls in light of this acquisition, we cannot provide any assurances that there will be no significant deficiencies or material weaknesses in our internal control over financial reporting.
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Any significant deficiency or material weakness in the internal control structure of our acquired business may cause significant deficiencies or material weaknesses in our internal control over financial reporting, which could have an adverse effect on our business and our ability to comply with Section 404 of Sarbanes-Oxley.
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Goodwill and other acquired intangible assets could become impaired and adversely affect our future operating results. We account for business acquisitions as business combinations under the acquisition method of accounting in accordance with accounting principles generally accepted in the United States.
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Under the acquisition method of accounting, the total purchase price is allocated to net tangible assets and identifiable intangible assets of acquired businesses based on their fair values as of the date of completion of the acquisition. The excess of the purchase price over those fair values is recorded as goodwill.
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To the extent the value of goodwill or other intangible assets become impaired, we may be required to incur material charges relating to such impairment. We conduct our goodwill and indefinite-lived intangible asset impairment analysis annually, or more frequently if we believe indicators of impairment exist.
Added
Our reported financial condition and results of operations reflect the balances and results of the acquired business but are not restated retroactively to reflect the historical financial position or results of operations of the acquired business for periods prior to the acquisition. As a result, comparisons of future results against prior period results will be more difficult for investors.
Added
In additional, there can be no guarantee that acquired intangible assets, particularly in-process research and development, will generate revenues or profits that we include in our forecast that is the basis for their fair value as of the acquisition date.
Added
Any such impairment charges relating to goodwill or other intangible assets could have a material impact on our operating results in future periods, and the announcement of a material impairment could have a material adverse effect on the trading price and trading volume of our common stock.
Added
As of April 30, 2025, our Condensed Consolidated Balance Sheet reflected goodwill of $12.5 million and other intangible assets, net of $17.8 million.
Added
Declines in construction activity or demand for our products could materially and adversely affect our business and financial condition. Changes in the U.S. political or regulatory environment could affect the availability of government funding, which could negatively impact our business. Certain of our customers may rely on government programs as a source of funding, such as medical research grants.
Added
Funding from government agencies or government reimbursement programs often fluctuates and is subject to the political process, which is often unpredictable. Any reduction in the availability or rate of funding or reimbursement, or delays surrounding the approval of such funding or reimbursement, may negatively impact our customers. We face numerous manufacturing and supply chain risks.
Added
Legal and Regulatory Compliance Risks Our global operations are subject to the laws and regulations of numerous domestic and foreign jurisdictions. Failure to comply with such rules may have a material adverse impact on our business and results of operations.
Added
We maintain operations internationally and are therefore subject to laws, regulations, and other measures in the United States and other countries. These laws can vary substantially from country to country and change from time to time. Failure to comply with these regulations could adversely affect our business.
Added
Under these laws and regulations, including economic sanctions laws, export laws, anti-corruption laws, anti-money-laundering laws, customs laws, and other laws that govern our organization and its operations, various government agencies may require export licenses, may seek to impose modifications to business practices, including cessation of business activities in sanctioned countries or with sanctioned persons or entities and modifications to compliance programs, which may increase compliance costs and may subject us to fines, penalties, and other sanctions.
Added
A violation of these laws, regulations, policies, or procedures could adversely impact our business, results of operations, and financial condition. The nature of our international operations also subjects us to local, state, regional, and national tax laws in jurisdictions around the world. Significant judgment may be required in determining our worldwide provision for income taxes.
Added
Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the law are issued or applied. Any changes to tax laws could have a material adverse effect on our tax obligations and effective tax rate.
Added
Our income tax obligations could be affected by many factors, including, but not limited to, changes to our corporate operating structure, intercompany arrangements, and tax planning strategies.
Added
Although we have implemented policies and procedures designed to ensure compliance with these laws and policies, there can be no assurance that all of our employees, contractors, channel partners, and agents have complied or will comply with these laws and policies. Further, we cannot predict any changes to these laws and policies or their interpretations in the future.
Added
Significant changes to these laws or policies, or violations of existing laws and policies by our employees, contractors, channel partners, or agents, could result in material adverse effects on our business and results of operations.
Added
The new tariffs and other changes in U.S. trade policy during the first half of calendar year 2025 have triggered retaliatory actions by affected countries, and foreign governments have instituted or are considering imposing tariffs and trade sanctions.
Added
General Risks Our stock price is likely to be volatile and could drop.
Added
The sweeping nature of pandemics makes it 11 Table of Contents extremely difficult to predict how and to what extent our business and operations could be affected in the long run.
Added
Further, should any key employees become ill during the course of a future health event and be unable to work, our ability to operate our internal controls may be adversely impacted.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

1 edited+0 added−0 removed10 unchanged
Biggest changeThis includes overseeing risk assessments, developing security policies and procedures, and managing the IT security team. See Item 10 , Directors, Executive Officers and Corporate Governance , for more detail on his education and experience. Senior executives, including the Company's CEO and CFO, integrate cybersecurity risks into the overall business strategy and financial planning. 11 Table of Contents
Biggest changeThis includes overseeing risk assessments, developing security policies and procedures, and managing the IT security team. See Item 10 , Directors, Executive Officers and Corporate Governance , for more detail on his education and experience. Senior executives, including the Company's CEO and CFO, integrate cybersecurity risks into the overall business strategy and financial planning. 13 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−0 removed1 unchanged
Biggest changeWe also lease an office facility in Charlotte, North Carolina. In Bangalore, India, we lease and operate a manufacturing facility comprising 119,000 square feet. Our international sales and administrative offices are located in Singapore, India, and Saudi Arabia. We believe our facilities are suitable for their respective uses and are adequate for our current needs.
Biggest changeWe also lease office, manufacturing, and warehouse space in Long Lake, Plymouth, and Crystal, Minnesota. In Bangalore, India, we lease and operate a manufacturing facility. Our international sales and administrative offices are located in Singapore, India, and Saudi Arabia. We believe our facilities are suitable for their respective uses and are adequate for our current needs.
See Note 5 , Sale-Leaseback Financing Transaction , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for information concerning the Sale-Leaseback Arrangement. In addition, we lease our primary distribution facility and other warehouse facilities totaling 366,000 square feet in Statesville, North Carolina.
See Note 7 , Sale-Leaseback Financing Transaction , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for information concerning the Sale-Leaseback Arrangement. In addition, we lease our primary distribution facility and other warehouse facilities in Statesville, North Carolina and an office facility in Charlotte, North Carolina.
Item 2. Properties We lease and operate three adjacent manufacturing facilities in Statesville, North Carolina. These facilities also house our corporate offices, as well as sales and marketing, administration, engineering and drafting personnel. These facilities together comprise 414,000 square feet and are located on 20 acres of land.
Item 2. Properties We lease and operate three adjacent manufacturing facilities in Statesville, North Carolina. These facilities also house our corporate offices, as well as sales and marketing, administration, engineering and drafting personnel.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed1 unchanged
Biggest changeWe believe that any such matters presently pending will not, individually or in the aggregate, have a material adverse effect on our results of operations or financial condition. Item 4. Mine Safety Disclosures Not Applicable. 12 Table of Contents PART II
Biggest changeWe believe that any such matters presently pending will not, individually or in the aggregate, have a material adverse effect on our results of operations or financial condition. Item 4. Mine Safety Disclosures Not Applicable. 14 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

2 edited+0 added−0 removed2 unchanged
Biggest changeSHARE REPURCHASE PLAN See Note 8 , Stockholders' Equity , in Part II, Item 8 in this Form 10-K for a discussion of activity related to the share repurchase plan that was adopted on August 31, 2023. Item 6. Reserved 13 Table of Contents
Biggest changeSHARE REPURCHASE PLAN See Note 10 , Stockholders' Equity , in Part II, Item 8 in this Form 10-K for a discussion of activity related to the share repurchase plan that was adopted on August 31, 2023 and subsequently amended on March 12, 2025. Item 6. Reserved 15 Table of Contents
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NASDAQ Global Market, under the symbol KEQU. As of June 24, 2024, there were 90 stockholders of record.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NASDAQ Global Market, under the symbol KEQU. As of June 24, 2025, there were 73 stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

32 edited+23 added−15 removed4 unchanged
Biggest changeThe changes in the net earnings attributable to the non-controlling interest for each year were due to changes in the levels of net income of the subsidiaries. 15 Table of Contents Net earnings were $18,753,000, or $6.38 per diluted share, as compared to $738,000, or $0.25 per diluted share, for fiscal years ended April 30, 2024 and April 30, 2023, respectively.
Biggest changeNet earnings were $11,405,000, or $3.83 per diluted share, as compared to $18,753,000, or $6.38 per diluted share, for fiscal years ended April 30, 2025 and April 30, 2024, respectively. The decrease in net earnings was attributable to the factors discussed above.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations INTRODUCTION Kewaunee Scientific Corporation is a recognized leader in the design, manufacture and installation of laboratory, healthcare and technical furniture products. The Company's corporate headquarters are located in Statesville, North Carolina. Sales offices are located in the United States, India, Saudi Arabia, and Singapore.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations INTRODUCTION Kewaunee Scientific Corporation is a recognized leader in the design, manufacture and installation of laboratory, healthcare and technical furniture and infrastructure products. The Company's corporate headquarters are located in Statesville, North Carolina. Sales offices are located in the United States, India, Saudi Arabia, and Singapore.
See Note 4 , Long-term Debt and Other Credit Arrangements , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report for additional information concerning our credit facility. In fiscal year 2022, we executed a Sale-Leaseback financing transaction with respect to our manufacturing and corporate facilities in Statesville, North Carolina to provide additional liquidity.
See Note 6 , Long-term Debt and Other Credit Arrangements , of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report for additional information concerning our credit facility. In fiscal year 2022, we executed a Sale-Leaseback financing transaction with respect to our manufacturing and corporate facilities in Statesville, North Carolina to provide additional liquidity.
The majority of the April 30, 2024 accounts receivable balances are expected to be collected during the first quarter of fiscal year 2025, with the exception of retention amounts on fixed-price contracts which are collected when the entire construction project is completed and all retention funds are paid by the owner.
The majority of the April 30, 2025 accounts receivable balances are expected to be collected during the first quarter of fiscal year 2026, with the exception of retention amounts on fixed-price contracts which are collected when the entire construction project is completed and all retention funds are paid by the owner.
The fiscal year 2025 expenditures are expected to be funded primarily by operating activities, supplemented as needed by borrowings under our revolving credit facility.
The fiscal year 2026 expenditures are expected to be funded primarily by operating activities, supplemented as needed by borrowings under our revolving credit facility.
Our effective tax rates could be affected by numerous factors, such as changes in our business operations, acquisitions, investments, entry into new businesses and geographies, intercompany transactions, the relative amount of our foreign earnings, including earnings being lower than anticipated in jurisdictions where we have lower statutory rates and higher than anticipated in 14 Table of Contents jurisdictions where we have higher statutory rates, losses incurred in jurisdictions for which we are not able to realize related tax benefits, the applicability of special tax regimes, changes in foreign currency exchange rates, changes to our forecasts of income and loss and the mix of jurisdictions to which they relate, changes in our deferred tax assets and liabilities, their valuation, and the assumptions around their realization in connection with any associated valuation, and interpretations related to tax laws and accounting rules in various jurisdictions.
In addition, our actual and forecasted earnings are subject to change due to economic, political, and other conditions. 16 Table of Contents Our effective tax rates could be affected by numerous factors, such as changes in our business operations, acquisitions, investments, entry into new businesses and geographies, intercompany transactions, the relative amount of our foreign earnings, including earnings being lower than anticipated in jurisdictions where we have lower statutory rates and higher than anticipated in jurisdictions where we have higher statutory rates, losses incurred in jurisdictions for which we are not able to realize related tax benefits, the applicability of special tax regimes, changes in foreign currency exchange rates, changes to our forecasts of income and loss and the mix of jurisdictions to which they relate, changes in our deferred tax assets and liabilities, their valuation, and the assumptions around their realization in connection with any associated valuation, and interpretations related to tax laws and accounting rules in various jurisdictions.
See Note 5 , Sale-Leaseback Financing Transaction for more information. We did not have any off balance sheet arrangements at April 30, 2024 or 2023.
See Note 7 , Sale-Leaseback Financing Transaction for more information. We did not have any off balance sheet arrangements at April 30, 2025 or 2024.
Working capital was $56.0 million at April 30, 2024, up from $47.9 million at April 30, 2023, and the ratio of current assets to current liabilities was 2.4-to-1.0 at April 30, 2024, up from a ratio of 2.2-to-1.0 at April 30, 2023. No dividends were declared or paid on the Company's common stock during the last two fiscal years.
Working capital was $64.7 million at April 30, 2025, up from $56.0 million at April 30, 2024, and the ratio of current assets to current liabilities was 2.2-to-1.0 at April 30, 2025, down from a ratio of 2.4-to-1.0 at April 30, 2024. No dividends were declared or paid on the Company's common stock during the last two fiscal years.
The improved focus of the organization, combined with a strong global management team, a healthy backlog, improved manufacturing capabilities, and end-use markets that continue to prioritize investment in projects that require the products Kewaunee designs and manufactures, positions the Company well.
The Company's strong global management team, healthy backlog, improved manufacturing capabilities, and end-use markets that continue to prioritize investment in projects that require the products Kewaunee designs and manufactures, positions the Company well.
Tax laws, regulations, administrative practices, and interpretations in various jurisdictions may be subject to significant change, with or without notice, due to economic, political, and other conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes.
Income Taxes We are subject to income taxes in the U.S. (federal and state) and foreign jurisdictions. Tax laws, regulations, administrative practices, and interpretations in various jurisdictions may be subject to significant change, with or without notice, due to economic, political, and other conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes.
We believe that these sources of funds will be sufficient to support ongoing business requirements, including capital expenditures, through fiscal year 2025. At April 30, 2024, we had $3,000,000 outstanding under our $15.0 million revolving credit facility.
We believe that these sources of funds will be sufficient to support ongoing business requirements, including capital expenditures, through fiscal year 2026. At April 30, 2025, we had no advances outstanding under our $20.0 million Revolving Credit Facility with PNC.
The impact of such possible increases is considered when determining the sales price. The principal raw materials and products manufactured by others used in our products are cold-rolled carbon and stainless steel, hardwood lumbers and plywood, paint, chemicals, resins, hardware, plumbing and electrical fittings. Such materials and products are purchased from multiple suppliers and are typically readily available.
The principal raw materials and products manufactured by others used in our products are cold-rolled carbon and stainless steel, hardwood lumber and plywood, paint, chemicals, resins, hardware, plumbing and electrical fittings. Such materials and products are purchased from multiple suppliers and are typically readily available. ACQUISITION OF NU AIRE, INC.
Income tax benefit was $5.9 million for fiscal year 2024, or 45.3% of pretax earnings, as compared to income tax expense of $3.1 million for fiscal year 2023, or 69.8% of pretax earnings.
Income tax expense was $3.2 million for fiscal year 2025, or 21.7% of pretax earnings, as compared to an income tax benefit of $5.9 million for fiscal year 2024, or 45.3% of pretax earnings.
The Company's financing activities used cash of $3,014,000 during fiscal year 2024 as a result of the net decrease in short-term borrowings of $488,000, repayments on our financing liability of $642,000, and the repurchase of outstanding shares as part of our announced share repurchase program for $1,998,000, partially offset by net proceeds from long-term debt of $114,000.
The Company's financing activities used cash of $3,014,000 during fiscal year 2024 as a result of the net decrease in short-term borrowings of $488,000, repayments on our financing liability of $642,000, and the repurchase of outstanding shares as part of our announced share repurchase program for $1,998,000, partially offset by net proceeds from long-term debt of $114,000. 18 Table of Contents The Company's investing activities used cash of $30,901,000 in fiscal year 2025, of which $28,735,000 related to the acquisition of Nu Aire, net of cash acquired and $2,166,000 was used for capital expenditures.
Net earnings attributable to the non-controlling interest related to our subsidiaries that are not 100% owned by the Company were $304,000 and $621,000 for fiscal years 2024 and 2023, respectively.
Net earnings attributable to the non-controlling interest related to our subsidiaries that are not 100% owned by the Company were $178,000 and $304,000 for fiscal years 2025 and 2024, respectively. The changes in the net earnings attributable to the non-controlling interest for each year were due to changes in the levels of net income of the subsidiaries.
Pension expense was $4,177,000 and $71,000 in fiscal years 2024 and 2023, respectively. The increase in pension expense was due to the Company successfully annuitizing its pension obligation, which had been in a frozen state since 2005.
The decrease in pension expense was due to the Company successfully annuitizing its pension obligation during fiscal year 2024, which had been in a frozen state since 2005.
The declaration and payment of any future dividends is at the discretion of the Board of Directors and will depend upon many factors, including the Company's earnings, capital requirements, investment and growth strategies, financial condition, the terms of the Company's indebtedness, which contains provisions that could limit the payment of dividends in certain circumstances, and other factors that the Board of Directors may deem to be relevant. 16 Table of Contents RECENT ACCOUNTING STANDARDS See Note 1 , Summary of Significant Accounting Policies , to our Consolidated Financial Statements in this Form 10-K for a discussion of new accounting pronouncements, which is incorporated herein by reference.
The declaration and payment of any future dividends is at the discretion of the Board of Directors and will depend upon many factors, including the Company's earnings, capital requirements, investment and growth strategies, financial condition, the terms of the Company's indebtedness, which contains provisions that could limit the payment of dividends in certain circumstances, and other factors that the Board of Directors may deem to be relevant.
Changes or delays in building construction may cause delays in delivery of the orders and our recognition of the sale. Since prices are normally quoted on a firm basis in the industry, we bear the burden of possible increases in labor and material costs between quotation of an order and delivery of the product.
Since prices are normally quoted on a firm basis in the industry, we bear the burden of possible increases in labor and material costs between quotation of an order and delivery of the product. The impact of such possible increases is considered when determining the sales price.
Terminating the pension resulted in a one-time expense of $4,019,000 for accounting losses that were being amortized from the Balance Sheet based on an annual evaluation of the pension plan. By annuitizing the pension obligation, the Company has eliminated all future responsibility for the plan and future administrative costs associated with maintaining and managing the pension plan.
Terminating the pension resulted in a one-time expense during the prior fiscal year of $4,019,000 for accounting losses that were being amortized from the Balance Sheet based on an annual evaluation of the pension plan.
Three manufacturing facilities are located in Statesville serving the domestic and international markets, and one manufacturing facility is located in Bangalore, India serving the local, Asian, and African markets. Kewaunee Scientific Corporation's website is located at www.kewaunee.com . The reference to our website does not constitute incorporation by reference of any information contained at that site.
Three manufacturing facilities are located in Statesville and one facility is located in Plymouth, Minnesota, with additional manufacturing capabilities in Long Lake, Minnesota, serving the domestic and international markets, and one manufacturing facility is located in Bangalore, India serving the local, Asian, and African markets. Kewaunee Scientific Corporation's website is located at www.kewaunee.com .
Capital expenditures were $4,373,000 and $4,148,000 in fiscal years 2024 and 2023, respectively. Capital expenditures in fiscal year 2024 were funded primarily from financing activities. Fiscal year 2025 capital expenditures are anticipated to be approximately $4.0 million.
The Company's investing activities used cash of $4,373,000 in fiscal year 2024, of which the full amount related to capital expenditures. Capital expenditures in fiscal year 2025 were funded primarily by operations and from financing activities. Fiscal year 2026 capital expenditures are anticipated to be approximately $7.0 million.
We consider the markets in which we compete to be highly competitive, with a significant amount of the market requiring competitive public bidding. It is common in the laboratory and healthcare furniture industries for customer orders to require delivery at extended future dates, as products are frequently to be installed in buildings yet to be constructed.
It is common in the laboratory and healthcare furniture industries for customer orders to require delivery at extended future dates, as products are frequently to be installed in buildings yet to be constructed. Changes or delays in building construction may cause delays in delivery of the orders and our recognition of the sale.
Operating activities used cash of $3,790,000 in fiscal year 2023, primarily for increases in receivables of $4,947,000 and decreases in accounts payable and accrued expenses of $5,558,000, partially offset by cash from operations, decreases in inventories of $1,907,000, and increases in deferred revenue of $568,000.
Operating activities provided cash of $19,564,000 in fiscal year 2024, primarily from operations and decreases in receivables of $741,000, decreases in inventories of $1,210,000, increases in accounts payable and accrued expenses of $691,000, and increases in deferred revenue of $277,000.
The decrease in other income in fiscal year 2024 was primarily due to the elimination of interest income earned from the Note Receivable related to the Sale-Leaseback financing transaction that was settled in the prior year, partially offset by interest earned on the increased Domestic cash balances and increased interest on International cash balances when compared to the prior fiscal year.
The decrease in other income in fiscal year 2025 was primarily due to lower interest earned on international cash balances and the acceleration of deferred financing costs related to the payoff of the Company's Mid Cap Revolving Credit Facility, partially offset by higher interest earned on increased domestic cash balances.
Gross profit represented 25.5% and 16.2% of sales in fiscal years 2024 and 2023, respectively. The increase in gross profit margin percentage is primarily being generated from Domestic operations.
Our order backlog was $214.6 million at April 30, 2025, as compared to $155.6 million at April 30, 2024. Gross profit represented 28.6% and 25.5% of sales in fiscal years 2025 and 2024, respectively. The increase in gross profit margin percentage is primarily attributable to our Domestic operations.
The increase in net earnings was attributable to the factors discussed above. LIQUIDITY AND CAPITAL RESOURCES Our principal sources of liquidity have historically been funds generated from operating activities, supplemented as needed by borrowings under our revolving credit facility. Additionally, certain machinery and equipment are financed by non-cancelable operating and financing leases.
LIQUIDITY AND CAPITAL RESOURCES Our principal sources of liquidity have historically been funds generated from operating activities, supplemented as needed by borrowings under our previous Mid Cap Revolving Credit Facility (as defined below). The Company terminated the Mid Cap Revolving Credit Facility on September 30, 2024.
Our products are sold primarily through purchase orders and contracts submitted by customers through our dealers, our subsidiaries in Singapore and India, and a national distributor. Products are sold principally to pharmaceutical, biotechnology, industrial, chemical and commercial research laboratories, educational institutions, healthcare institutions, governmental entities, manufacturing facilities and users of networking furniture.
The reference to our website does not constitute incorporation by reference of any information contained at that site. Our products are sold primarily through purchase orders and contracts submitted by customers directly or through our dealers, our subsidiaries in Singapore and India, and a national distributor.
Specifically, the increase is primarily driven by improved manufacturing productivity, cost containment actions, and the pricing of new orders in response to higher raw material input costs when compared to the prior year. Operating expenses were $33.8 million and $30.2 million in fiscal years 2024 and 2023, respectively, and 16.6% and 13.8% of sales, respectively.
The acquisition of Nu Aire on November 1, 2024, combined with improved manufacturing productivity and effective cost-containment measures, contributed significantly to this improvement. Operating expenses were $51.1 million and $33.8 million in fiscal years 2025 and 2024, respectively, and 21.2% and 16.6% of sales, respectively.
Income tax expense for fiscal year 2024 excluding these one-time benefits is $4.5 million or 34.4% of pretax earnings. At April 30, 2024, the Company has a Domestic valuation allowance of $808,000 for specific federal and state tax credits as compared to $8.5 million for the Company's Domestic net deferred tax assets at April 30, 2023.
At April 30, 2025, the Company has a Domestic valuation allowance of $808,000 for specific federal and st 17 Table of Contents ate tax credits, unchanged from the valuation allowance balance at April 30, 2024. See Note 8 , Income Taxes for additional information.
See Note 5 , Sale-Leaseback Financing Transaction for additional information on this transaction. Interest expense was $1,799,000 and $1,734,000 in fiscal years 2024 and 2023, respectively. The interest expense for fiscal year 2024 was relatively unchanged from the prior fiscal year.
Interest expense was $3,214,000 and $1,799,000 in fiscal years 2025 and 2024, respectively. The increase in interest expense for fiscal year 2025 was primarily due to elevated borrowing levels.
The increase in operating expenses in fiscal year 2024 as compared to fiscal year 2023 was primarily due to increases in SG&A wages, benefits, incentive and stock-based compensation of $2,572,000, corporate governance expenses of $170,000, depreciation expense of $164,000, bad debt expense of $156,000, and increases in international operating expenses of $616,000, partially offset by decreases in consulting and professional services of $557,000.
The increase in operating expenses in fiscal year 2025 as compared to fiscal year 2024 was largely attributable to our acquisition of Nu Aire. Other significant factors were increases in professional and consulting fees of $2,097,000, increases in SG&A wages of $1,443,000 and an increase in international operating expenses of $1,412,000.
Other income, net was $814,000 and $939,000 in fiscal years 2024 and 2023, respectively.
By annuitizing the pension obligation, the Company eliminated all future responsibility for the plan and future administrative costs associated with maintaining and managing the pension plan. Other income, net was $240,000 and $814,000 in fiscal years 2025 and 2024, respectively.
Removed
Allowance for Credit Losses Evaluation of the allowance for credit losses involves management judgments and estimates. We evaluate the collectability of our trade accounts receivable based on a number of factors.
Added
Products are sold principally to pharmaceutical, biotechnology, industrial, chemical and commercial research laboratories, educational institutions, healthcare institutions, governmental entities, and manufacturing facilities. We consider the markets in which we compete to be highly competitive, with a significant amount of the market requiring competitive public bidding.
Removed
In circumstances where management is aware of a customer's inability to meet its financial obligations to us, or a project dispute makes it unlikely that the outstanding amount owed by a customer will be collected, a specific reserve for bad debts is estimated and recorded to reduce the recognized receivable to the estimated amount we believe will ultimately be collected.
Added
On November 1, 2024, the Company completed an acquisition of Nu Aire. The Company purchased all of the outstanding capital stock of Nu Aire for $55.0 million, subject to certain customary adjustments for debt, cash, transaction expenses, and net working capital. $23.0 million of the purchase price payable at closing of the Transaction was funded pursuant to subordinated seller notes.
Removed
In addition to specific customer identification of potential bad debts, a reserve for credit losses is estimated and recorded based on our recent past loss history and an overall assessment of past due trade accounts receivable amounts outstanding. Self-Insurance Reserves The Company's domestic operations are self-insured for employee health care costs.
Added
The remaining purchase price payable at closing of the Transaction was paid in cash, which cash was funded, in part, through the Revolving Credit Facility and Term Loan, provided by PNC Bank, National Association.
Removed
The Company has purchased specific stop-loss insurance policies to limit claims above a certain amount. Estimated medical costs were accrued for claims incurred but not reported using assumptions based upon historical loss experiences.
Added
Nu Aire is renowned for its manufacturing of biological safety cabinets, airflow products, CO2 incubators, ultralow freezers, animal handling equipment, pharmacy compounding isolators, and related parts and accessories. Their products serve a diverse range of industries, including life sciences, healthcare, pharmacy, education, food and beverage, and industrial sectors.
Removed
The Company's exposure reflected in the self-insurance reserves varies depending upon market conditions in the insurance industry, availability of cost-effective insurance coverage, and actual claims versus estimated future claims. Income Taxes We are subject to income taxes in the U.S. (federal and state) and foreign jurisdictions.
Added
The acquisition of Nu Aire presents a unique opportunity for the Company to combine its robust capabilities with a recognized market leader whose product portfolio and well-developed channel strategy complement the Company's existing offerings. This acquisition expands the Company's capabilities, allowing the combined organization to better meet the diverse needs of end-users in laboratory furnishings.
Removed
In addition, our actual and forecasted earnings are subject to change due to economic, political, and other conditions.
Added
Additionally, Nu Aire has established distribution partners in regions where the Company has not previously had a presence. This move accelerates the Company's vision of becoming the market leader in the design and manufacturing of laboratory furniture and technical products essential for outfitting laboratories.
Removed
RESULTS OF OPERATIONS Sales for fiscal year 2024 were $203.8 million, a decrease compared to fiscal year 2023 sales of $219.5 million. Domestic Segment sales for fiscal year 2024 were $137.2 million, a decrease of 6.5% compared to fiscal year 2023 sales of $146.7 million.
Added
Goodwill and Other Intangible Assets The Company accounted for the Nu Aire acquisition as a business combination using the acquisition method of accounting in accordance with ASC 805, Business Combinations . The purchase price was allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition.
Removed
The decrease in Domestic sales was predominantly related to the reduction in non-product revenue related to the Company's decision to stop selling directly to end users. This revenue typically includes freight, installation services and buyouts. International Segment sales for fiscal year 2024 were $66.5 million, a decrease of 8.6% from fiscal year 2023 sales of $72.8 million.
Added
The excess of the purchase price over the fair value of the net assets was allocated to goodwill. The fair value of intangible assets acquired were valued using the income approach. A cost approach was applied for property, plant and equipment.
Removed
International sales decreased when compared to the prior year period due to the delivery of several large projects in the comparable prior year period that were booked in earlier fiscal years. Our order backlog was $155.6 million at April 30, 2024, as compared to $147.9 million at April 30, 2023.
Added
In many cases, the determination of fair values required estimates about discount rates, future expected cash flows and other future events that are judgmental and subject to change. Intangible assets and property, plant and equipment will be amortized or depreciated on a straight-line basis over the relevant estimated useful life.
Removed
The income tax benefit for fiscal year 2024 is primarily due to the favorable impact of the reduction of the Domestic valuation allowance of $6.6 million that was required to be established in fiscal year 2020 per ASC 740 and $3.9 million related to prior years' unrecognized tax benefits related to the settlement of the Company's domestic pension plans.
Added
The Company will conduct its impairment analysis annually, or more frequently if the Company determines potential indicators of impairment exist. RESULTS OF OPERATIONS Sales for fiscal year 2025 were $240.5 million, an increase compared to fiscal year 2024 sales of $203.8 million.
Removed
See Note 6 , Income Taxes for additional information. The effective tax rate for fiscal year 2023 was unfavorably impacted by the increase in the valuation allowance attributable to changes to Internal Revenue Code Section 174 Research and Experimental Expenditures, which became effective during the fiscal year.
Added
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. The increase in Domestic sales was predominantly related to the acquisition of Nu Aire on November 1, 2024.
Removed
The primary impact of this change was the amortization of current year expenditures over a five year period, as compared to prior fiscal years where research expenditures were deductible in the year incurred.
Added
International Segment sales for fiscal year 2025 were $61.1 million, a decrease of 8.2% from fiscal year 2024 sales of $66.5 million. International sales decreased when compared to the prior year period due to customer site delays in India which pushed out the timing of deliveries.
Removed
The following table summarizes the cash payment obligations for our lease and financing arrangements as of April 30, 2024: PAYMENTS DUE BY PERIOD ($ in thousands) Contractual Cash Obligations Total 1 Year 2-3 Years 4-5 Years After 5 years Operating Leases $ 9,802 $ 2,437 $ 3,612 $ 1,859 $ 1,894 Financing Lease Obligations 419 131 152 80 56 Sale-Leaseback Financing Transaction 41,986 1,970 4,058 4,222 31,736 Total Contractual Cash Obligations $ 52,207 $ 4,538 $ 7,822 $ 6,161 $ 33,686 The Company's operating activities provided cash of $19,564,000 in fiscal year 2024, primarily from operations and decreases in receivables of $741,000, decreases in inventories of $1,210,000, increases in accounts payable and accrued expenses of $691,000, and increases in deferred revenue of $277,000.
Added
The increases in consulting and professional fees for the year were primarily attributed to costs associated with the acquisition and integration of Nu Aire and costs incurred related to Sarbanes-Oxley 404(b) compliance readiness. Pension expense was $0 and $4,177,000 in fiscal years 2025 and 2024, respectively.
Removed
The Company's financing activities provided cash of $14,931,000 during fiscal year 2023 from proceeds of $13,629,000 from the Sale-Leaseback transaction and proceeds from the net increase in short-term borrowings of $1,998,000, partially offset by repayment of long-term debt of $121,000.
Added
The income tax expense for fiscal year 2025 reflects the impact of foreign operations, which are taxed at different rates than the US tax rate of 21%, combined with the expected current year tax expense for the Company's Domestic operations.
Removed
The Company is operating more efficiently than in the past due to its ability to focus solely on supporting its dealers and distribution channel partners domestically while continuing to provide turnkey solutions in the international markets it serves.
Added
In conjunction with the Nu Aire Acquisition (see Note 4 , Nu Aire Acquisition for additional details), the Company entered into a new Revolving Credit Facility with PNC, which is available on an ongoing basis to supplement our sources of liquidity as needed. Additionally, certain machinery and equipment are financed by non-cancelable operating and financing leases.
Added
The following table summarizes the cash payment obligations for our lease and financing arrangements as of April 30, 2025: PAYMENTS DUE BY PERIOD ($ in thousands) Contractual Cash Obligations Total 1 Year 2-3 Years 4-5 Years After 5 years Operating Lease Obligations $ 13,660 $ 3,903 $ 5,844 $ 3,749 $ 164 Financing Lease Obligations 293 113 80 80 20 Sale-Leaseback Financing Transaction 40,016 2,009 4,139 4,307 29,561 Term Loan 13,750 3,000 6,000 4,750 — Seller Note (1) 23,000 — 23,000 — — Total Contractual Cash Obligations $ 90,719 $ 9,025 $ 39,063 $ 12,886 $ 29,745 (1) Excludes accrued PIK Interest of $935,000 as of April 30, 2025.
Added
All unpaid accrued PIK Interest will become due and payable on November 1, 2027, along with the outstanding principal balance. The Company's operating activities provided cash of $14,783,000 in fiscal year 2025.
Added
Excluding the impacts of the Nu Aire acquisition, net cash provided by operating activities was primarily from operations and decreases in inventories of $3,351,000, increases in deferred revenue of $765,000, increases in accounts payable and accrued expenses of $583,000, and the change in other, net of $20,000, partially offset by increases in receivables of $6,738,000.
Added
The Company's financing activities provided cash of $7,411,000 during fiscal year 2025, primarily related to the issuance of a new term loan from PNC bank in connection with the acquisition of Nu Aire, partially offset by the termination of the Company's Mid Cap Revolving Credit Facility on September 30, 2024 and the purchase of shares under the Company's share repurchase program.
Added
See Note 6 , Long-term Debt and Other Credit Arrangements , for additional information regarding the new term loan and see Note 10 , Stockholder's Equity , for additional information on the Company's share repurchase program.
Added
RECENT ACCOUNTING STANDARDS See Note 1 , Summary of Significant Accounting Policies , to our Consolidated Financial Statements in this Form 10-K for a discussion of new accounting pronouncements, which is incorporated herein by reference.
Added
In November 2024, the Company took a significant step forward in its growth journey with the acquisition of Nu Aire, a pioneer in laboratory and biosafety solutions, bringing together two market leaders with complementary strengths, shared values, and a common vision for the future of laboratory innovation.
Added
Kewaunee's fiscal year 2025 results are a testament to the consistent execution and dedication of the Company's global team, as well as the Company's strong relationships with its dealers and distribution channel partners, who bring our solutions to customers across multiple end markets.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

5 edited+2 added−1 removed1 unchanged
Biggest changeFor fiscal year 2024, 29% of net sales were derived in currencies other than U.S. dollars. We incur expenses in currencies other than U.S. dollars relating to specific contracts with customers and for our operations outside the U.S.
Biggest changeWe incur expenses in currencies other than U.S. dollars relating to specific contracts with customers and for our operations outside the U.S. 19 Table of Contents Over the long term, net sales to international markets may increase as a percentage of total net sales and, consequently, a greater portion of our business could be denominated in foreign currencies.
We have foreign currency cash accounts to operate our global business. These accounts are impacted by changes in foreign currency rates. Cash balances at April 30, 2024 of $11.2 million were held by our foreign subsidiaries and denominated in currencies other than U.S. dollars. 17 Table of Contents
We have foreign currency cash accounts to operate our global business. These accounts are impacted by changes in foreign currency rates. Cash balances at April 30, 2025 of $8.4 million were held by our subsidiaries and denominated in currencies other than U.S. dollars. 20 Table of Contents
Over the long term, net sales to international markets may increase as a percentage of total net sales and, consequently, a greater portion of our business could be denominated in foreign currencies. As a result, operating results may become more subject to fluctuations based upon changes in the exchange rates of certain currencies in relation to the U.S. dollar.
As a result, operating results may become more subject to fluctuations based upon changes in the exchange rates of certain currencies in relation to the U.S. dollar.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rates We are exposed to market risk in the area of interest rates. This exposure is associated with balances outstanding under our revolving credit facility and certain lease obligations for production machinery, all of which are priced on a floating rate basis.
This exposure is associated with balances outstanding under our PNC loan agreement, which consists of both a revolving credit facility component and term loan, and certain lease obligations for production machinery, all of which are priced on a floating rate basis. We had no advances outstanding under our revolving credit facility at April 30, 2025.
Foreign Currency Exchange Rates Our results of operations could be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in foreign markets. We derive net sales in U.S. dollars and other currencies including Indian rupees, Singapore dollars, and other currencies.
The balance of our term loan was $13.8 million at April 30, 2025, bearing interest at floating rates. We believe that our current exposure to interest rate market risk is not material. Foreign Currency Exchange Rates Our results of operations could be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in foreign markets.
Removed
We had $3 million outstanding under our revolving credit facility at April 30, 2024, bearing interest at floating rates. We believe that our current exposure to interest rate market risk is not material.
Added
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Interest Rates We are exposed to market risk in the area of interest rates.
Added
We derive net sales in U.S. dollars and other currencies, including Indian rupees, Singapore dollars, Canadian dollars, and other currencies. For fiscal year 2025, 23% of net sales were derived in currencies other than U.S. dollars.

Other KEQU 10-K year-over-year comparisons