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Kewaunee sees earnings boost
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Published: June 29, 2009
Despite the increasing cost of raw materials, energy and transportation, Kewaunee Scientific Corp. reported a 36 percent net earnings increase during the year ended April 30.
Company officials credited Kewaunee's capital improvement for its efficiency and the domestic laboratory furniture market for its record sales. The Statesville-based scientific and technical furniture manufacturer's net earnings went up from $3.1 million at the end of the previous fiscal year to $4.2 at the end of April.
According to the company's news release, higher sales volume, lower manufacturing costs and improved operational efficiencies built up profits.
"This past year was a rewarding, yet challenging year," President and Chief Executive Officer William Shumaker, president and chief executive officer said in a statement. "Our programs and strategies over the past few years to make Kewaunee a stronger and more competitive company were put to the test."
Shumaker said the company tackled the escalating prices of certain raw materials, particularly steel and epoxy resin, higher energy and transportation costs during the first half of the economic year.
Kewaunee spokesman Mike Parker said the company spent $15 million on capital improvements during the past couple of years, which has allowed it to remain competitive in Statesville.
"By doing so, we have been able to keep 468 people employed," he said.
According to the company, incoming orders were strong as the domestic laboratory furniture marketplace offset the softer Asian marketplace.
Sales went up 16 percent from $89.5 million at the end of April 2008 to $103.9 million this year.
Domestic sales increased 22 percent to $90.2 million, while international sales went down 13 percent to $13.7 million.
Business growth also fueled the company's debt. Bank borrowings and capital lease obligations went up to $6.1 million at year's end, compared to $5.0 million at the end of the prior year, according to a company news release.
In the 2010 fiscal year, company officials expect Kewaunee's capital investments to continue to reap benefits. Shumaker stated the company's momentum for the upcoming year is being fueled by the the performances by its factories, a "healthy domestic laboratory furniture marketplace" and the company's order backlog.
The company operates smaller-scale operations through subsidiaries in Singapore and Bangalore, India. It recently completed its transition into a new plant in Bangalore, which will allows it to be more competitive in the Asian laboratory furniture marketplace, Shumaker said.
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