Shares of Kewaunee Scientific Corporation KEQU have declined 3.4% since reporting results for the fourth quarter of fiscal 2026. This compares with the S&P 500 index’s 1.8% fall over the same time frame. Over the past month, the stock has lost 12.1% compared with the S&P 500’s 3.8% decline. Notably, the company’s shares have underperformed the broader market over both periods following the earnings release.

Sales & Earnings Performance

Kewaunee Scientific reported fourth-quarter fiscal 2026 sales of $71.4 million, down 7.5% from $77.1 million a year earlier. Net earnings attributable to the company fell to $3.4 million from $4.9 million in the prior-year quarter, while diluted earnings per share declined to $1.13 from $1.63. Pre-tax earnings dropped to $4.8 million from $7.1 million, and quarterly EBITDA decreased to $6.5 million from $9.7 million.

For the full fiscal year, however, revenues increased 17.3% to $282 million from $240.5 million. Net earnings declined to $9.6 million from $11.4 million, while diluted EPS decreased to $3.22 from $3.83. Annual EBITDA improved to $22.4 million from $21.6 million despite lower earnings, reflecting continued operating cash generation.

Kewaunee Scientific Corporation Price, Consensus and EPS Surprise

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Other Key Business Metrics

Performance varied across business segments during the quarter. The renamed Lab Products Group (“LPG”) generated sales of $54.4 million, down 2% year over year from $55.5 million. Segment net earnings declined to $3.5 million from $5.1 million, while EBITDA fell to $6.7 million from $8.8 million as lower manufacturing volumes in the laboratory construction business reflected continued volatility in project delivery schedules. The company said that it continued adjusting production schedules while focusing on productivity and cost management.

The International segment recorded a steeper decline, with sales falling 21.3% to $17 million from $21.7 million. Segment net earnings slipped to $1.5 million from $1.6 million, while EBITDA declined to $2.1 million from $2.4 million. Management attributed the weaker performance primarily to shipment timing for Middle East projects, wherein deliveries continued to be affected by regional geopolitical disruptions.

On a full-year basis, LPG revenues rose 19.8% to $214.9 million, while International sales increased 9.9% to $67.1 million. International profitability strengthened during the year, with net earnings increasing to $4 million from $2.9 million despite geopolitical challenges.

The balance sheet strengthened over the fiscal year. Long-term debt declined to $40.9 million from $60.7 million after the company repaid seller notes related to the Nu Aire acquisition, while the debt-to-equity ratio improved to 0.61-to-1 from 0.99-to-1. Cash and restricted cash totaled $11.6 million as of April 30, 2026, compared with $17.2 million a year earlier. Year-end order backlog stood at $165.9 million, including $118.8 million for LPG and $47.1 million for the International segment.

Management Commentary

President and chief executive officer Thomas D. Hull III described fiscal 2026 as an excellent year despite a challenging operating environment, highlighting the company’s ability to sustain EBITDA while advancing strategic priorities. He pointed to progress in integrating Nu Aire, continued investment in the corporate platform to support acquisitions and meaningful balance-sheet improvement through debt reduction.

Hull also characterized the formation of the Lab Products Group as a milestone that combines Kewaunee and Nu Aire’s product portfolios into a broader offering for customers.

Regarding the fiscal fourth quarter, Hull said that project timing continued to weigh on manufacturing volumes within the laboratory construction business, while lower international billings tied to Middle East shipment timing modestly pressured profitability. Even so, he praised the company’s global teams for navigating these headwinds.

Factors Influencing Results

Management attributed the quarter’s weaker results primarily to operational timing rather than demand deterioration. In the Lab Products Group, lower manufacturing volumes stemming from project delivery timing reduced profitability, although productivity initiatives and cost controls remained in place. International operations were affected by shipment delays and geopolitical disruption in the Middle East that lowered billings.

For the fiscal year, management cited higher input costs and tariff-related cost pressure in the laboratory construction business, partially offset by productivity improvements, disciplined cost controls and proactive production scheduling.

Other Developments

In fiscal 2026, Kewaunee renamed its Domestic reportable segment to the Lab Products Group to better reflect its expanded business following the Nu Aire acquisition, while emphasizing that the change had no impact on reported financial results. The company also highlighted continued integration of Nu Aire, completed repayment of acquisition-related seller notes during the year and announced the addition of Jorge Santos to strengthen its international leadership team.

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