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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended January 31, 2003
[_] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from ____________ to _____________
Commission file number 0-5286
KEWAUNEE SCIENTIFIC CORPORATION
-------------------------------
(Exact name of registrant as specified in its charter)
Delaware 38-0715562
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
2700 West Front Street
Statesville, North Carolina 28677
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(704) 873-7202
--------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No _______
-----
As of March 14, 2003, the Registrant had outstanding 2,480,745 shares of Common
Stock.
Pages: This report, excluding exhibits, contains 19 pages numbered sequentially
from this cover page.
KEWAUNEE SCIENTIFIC CORPORATION
INDEX TO FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2003
Page Number
-----------
PART I. FINANCIAL INFORMATION
- -----------------------------
Item 1. Financial Statements
Condensed Consolidated Statements of Operations -
Three months and nine months
ended January 31, 2003 and 2002 3
Condensed Consolidated Balance Sheets
January 31, 2003 and April 30, 2002 4
Condensed Consolidated Statements of Cash Flows -
Nine months ended January 31, 2003 and 2002 5
Notes to Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
Review by Independent Accountants 15
Report by Independent Accountants 16
Item 3. Quantitative and Qualitative Disclosures
About Market Risk 17
Item 4. Controls and Procedures 17
PART II. OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings 17
Item 5. Other Matters 18
Item 6. Exhibits and Reports on Form 8-K 18
SIGNATURE 19
- ---------
2
Part 1. Financial Information
Item 1. Financial Statements
Kewaunee Scientific Corporation
Condensed Consolidated Statements of Operations
(Unaudited)
Three months ended Nine months ended
January 31 January 31
---------------------- ----------------------
2003 2002 2003 2002
-------------------------------------------------
($ in thousands, except per share data)
Net sales $ 16,381 $ 20,798 $ 55,691 $ 63,063
Cost of products sold 12,919 17,113 45,645 52,237
-------- -------- -------- --------
Gross profit 3,462 3,685 10,046 10,826
Operating expenses 3,361 3,081 9,621 8,691
-------- -------- -------- --------
Operating earnings 101 604 425 2,135
Interest expense (35) (50) (117) (169)
Other (expense) income (24) (6) 44 32
-------- -------- -------- --------
Earnings before income taxes 42 548 352 1,998
Income tax expense - 132 110 651
-------- -------- -------- --------
Net earnings $ 42 $ 416 $ 242 $ 1,347
======== ======== ======== ========
Net earnings per share-
Basic $ 0.02 $ 0.17 $ 0.10 $ 0.55
Diluted $ 0.02 $ 0.17 $ 0.10 $ 0.54
Weighted average number of common shares
outstanding (in thousands)-
Basic 2,480 2,464 2,477 2,468
Diluted 2,487 2,474 2,486 2,480
See accompanying notes to condensed consolidated financial statements.
3
Kewaunee Scientific Corporation
Condensed Consolidated Balance Sheets
(in thousands)
January 31 April 30
2003 2002
---------- --------
(Unaudited)
Assets
- ------
Current assets:
Cash and cash equivalents $ 611 $ 1,747
Receivables, less allowance 19,031 18,979
Inventories 3,115 3,309
Deferred income taxes 581 581
Prepaid income taxes 116 296
Prepaid expenses and other current assets 840 514
---------- --------
Total current assets 24,294 25,426
---------- --------
Property, plant and equipment, at cost 39,516 36,691
Accumulated depreciation (25,762) (23,880)
---------- --------
Net property, plant and equipment 13,754 12,811
---------- --------
Other assets 3,477 3,953
---------- --------
Total Assets $ 41,525 $ 42,190
========== ========
Liabilities and Stockholders' Equity
- ---------------------------------------
Current liabilities:
Short-term borrowings $ 2,275 $ -
Current portion of long-term debt 681 681
Accounts payable 4,635 6,648
Employee compensation and amounts withheld 974 1,932
Deferred Revenue 692 481
Other accrued expenses 1,347 867
---------- --------
Total current liabilities 10,604 10,609
---------- --------
Long-term debt 1,419 1,930
Deferred income taxes 925 925
Accrued employee benefit plan costs 1,583 1,583
Other long-term liabilities 315 231
---------- --------
Total Liabilities 14,846 15,278
---------- --------
Stockholders' equity:
Common stock 6,550 6,550
Additional paid-in-capital 124 146
Retained earnings 20,868 21,146
Accumulated other comprehensive loss (5) -
Common stock in treasury, at cost (858) (930)
---------- --------
Total stockholders' equity 26,679 26,912
---------- --------
Total Liabilities and Stockholders' Equity $ 41,525 $ 42,190
========== ========
See accompanying notes to condensed consolidated financial statements.
4
Kewaunee Scientific Corporation
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
Nine months ended
January 31
------------------------------
2003 2002
------------ ------------
Cash flows from operating activities:
Net earnings $ 242 $ 1,347
Adjustments to reconcile net earnings to net cash
used in operating activities:
Depreciation 1,898 1,589
Provision for bad debts 223 94
Decrease in prepaid income taxes 180 717
Increase in receivables (275) (2,617)
Decrease (increase) in inventories 194 (402)
(Decrease) increase in accounts payable and
other current liabilities (2,491) 67
Increase (decrease) in deferred revenue 211 (431)
Other, net 234 217
------------ ------------
Net cash provided by operating activities 416 581
------------ ------------
Cash flows from investing activities:
Capital expenditures (3,212) (1,347)
Proceeds from sale of fixed assets 366 -
------------ ------------
Net cash used in investing activities (2,846) (1,347)
------------ ------------
Cash flows from financing activities:
Proceeds from long-term debt - 250
Payments on long-term debt (511) (466)
Increase in short-term borrowings 2,275 1,471
Dividends paid (520) (519)
Proceeds from exercise of stock options (including tax benefit) 50 9
Purchase of treasury stock - (106)
------------ ------------
Net cash provided by financing activities 1,294 639
------------ ------------
Decrease in cash and cash equivalents (1,136) (127)
Cash and cash equivalents, beginning of period 1,747 488
------------ ------------
Cash and cash equivalents, end of period $ 611 $ 361
============ ============
See accompanying notes to condensed consolidated financial statements.
5
Kewaunee Scientific Corporation
Notes to Condensed Financial Statements
(unaudited)
A. Financial Information
The unaudited interim condensed consolidated financial statements of Kewaunee
Scientific Corporation (the "Company" or "Kewaunee") have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission (the
"Commission"). Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting
principles generally accepted in the United States of America have been
condensed or omitted. These interim condensed financial statements should be
read in conjunction with the financial statements and notes included in the
Company's 2002 Annual Report to Stockholders.
The preparation of the financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make certain estimates and assumptions that affect reported
amounts and disclosures. Actual results could differ from those estimates.
In the opinion of management, the interim condensed consolidated financial
statements reflect all adjustments (consisting only of normal recurring
adjustments) necessary for a fair presentation of the interim periods. The
results of operations for the interim periods are not necessarily indicative of
the results of operations to be expected for the full year.
Certain prior quarterly accounts have been reclassified with current quarterly
presentations.
B. Inventories
Inventories consisted of the following (in thousands):
Jan. 31, 2003 April 30,2002
------------- -------------
Finished products $ 681 $ 671
Work in process 1,102 1,007
Raw materials 1,332 1,631
------ ------
$3,115 $3,309
====== ======
C. Balance Sheet
The Company's April 30, 2002 condensed consolidated balance sheet as presented
herein is derived from audited financial statements, but does not include all
disclosures required by generally accepted accounting principles.
6
D. Segment Information
The following table shows net sales and earnings (loss) before income taxes by
business segment for three months and nine months ended January 31, 2003 and
2002 (in thousands):
Laboratory Technical
Products Products Corporate Total
-------- -------- --------- -----
Three months ended
January 31, 2003
- ----------------
Revenues from
external customers $15,370 $1,011 $ -- $16,381
Intersegment revenues 173 -- (173) --
Segment profit (loss) 852 (251) (559) 42
Segment profit (loss)
Excluding non-recurring charges 852 (251) (297) 304
Three months ended
January 31, 2002
- ----------------
Revenues from
external customers $19,377 $1,421 $ -- $20,798
Intersegment revenues 237 -- (237) --
Segment profit (loss) 896 (142) (206) 548
Nine months ended
January 31, 2003
- ----------------
Revenues from
external customers $51,649 $4,042 $ -- $55,691
Intersegment revenues 518 -- (518) --
Segment profit (loss) 1,975 (295) (1,328) 352
Segment profit (loss)
Excluding non-recurring charges 2,325 (295) (687) 1,343
Nine months ended
January 31, 2002
- ----------------
Revenues from
external customers $58,172 $4,891 $ -- $63,063
Intersegment revenues 688 -- (688) --
Earnings (loss)
before income taxes 2,981 (416) (567) 1,998
7
E. Comprehensive Income
The Company adopted SFAS No. 133, "Accounting for Derivative Instruments and
Hedging Activities," effective January 1, 2001. SFAS No. 133 requires that the
Company record derivatives on the balance sheet at fair value and establishes
criteria for designation and effectiveness of hedging relationships. The nature
of the Company's business activities involves the management of various
financial and market risks, including those related to changes in interest
rates. The Company may from time-to-time employ derivative financial
instruments, such as interest rate swap contracts, to mitigate or eliminate
certain of those risks.
The Company does not enter into derivative instruments for speculative purposes.
The Company had one interest rate swap agreement outstanding at January 31,
2003. The change in fair value of this cash flow hedge resulted in a decrease of
$2,000 and an increase of $35,000 for the three and nine months ended January
31, 2003, respectively, to accumulated other comprehensive loss in the
accompanying condensed consolidated balance sheet.
For the Company's foreign subsidiaries, assets and liabilities are translated at
exchange rates prevailing on the balance sheet date. Revenues and expenses are
translated at weighted average exchange rates prevailing during the period and
any resulting translation adjustments are reported separately in shareholders'
equity. Changes in exchange rates for the three months and nine months ended
January 31, 2003 resulted in a decrease of $12,000 and $30,000, respectively, in
accumulated other comprehensive loss in the accompanying condensed consolidated
balance sheet.
A reconciliation of net income and total comprehensive income for the three
months and nine months ended January 31, 2003 is as follows (in thousands):
Three months ended Nine months ended
January 31, 2003 January 31, 2003
---------------- ----------------
Net income 42 $242
Change in fair value of
cash flow hedge, net of
income tax 2 (35)
Change in cumulative
foreign currency
translation adjustments 12 30
--- ----
Total comprehensive income $56 $237
8
F. Commitments and Contingencies
The Company previously reported that a judgment in the amount of approximately
$1.3 million had been issued against the Company in fiscal year 2002 associated
with a legal dispute between the Company and a general contractor, Bernards
Bros. Inc. The judgment had been issued after an arbitrator's award of damages
against the Company and other defendants. The Company filed an appeal of the
judgment and the Court of Appeals of the State of California subsequently
overturned the judgment and returned the case to the Trial Court for the limited
purpose of fashioning, with the input of the parties, a judgment which properly
reflects the arbitrator's award in the case. The Trial Court has not yet
rendered an opinion; however, the Company feels the case will ultimately be
concluded with a liability to the Company approximating the amount previously
recorded in the financial statements.
G. Relocation of Technical Products Business
On October 31, 2002, the Company announced its decision to relocate the
operations of its technical products business from Lockhart, Texas to
Statesville, North Carolina. Once this relocation is complete, the Company
expects to dispose of the land and building in Lockhart, Texas for an amount in
excess of the $1.3 million net book value reflected in the financial statements
at January 31, 2003. The relocation is on schedule to be completed in the fourth
quarter of the current year.
9
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
The Company's 2002 Annual Report to Stockholders contains management's
discussion and analysis of financial condition and results of operations at and
for the year ended April 30, 2002. The following discussion and analysis
describes material changes in the Company's financial condition since April 30,
2002. The analysis of results of operations compares the three months and nine
months ended January 31, 2003 with the comparable periods of the prior fiscal
year.
Results of Operations
The Company recorded sales of $16.4 million for the three months ended January
31, 2003, down 21.2% from sales of $20.8 million for the comparable period of
the prior year. Sales for the nine months ended January 31, 2003 were $55.7
million, down 11.7% from sales of $63.1 million in the comparable period of the
prior year.
Sales of laboratory products decreased 20.7% and 11.2% during the three months
and nine months ended January 31, 2003, respectively, over the same periods last
year, reflecting a softness in the marketplace for medium-size laboratory
projects and delays in scheduled shipping dates for several projects. Sales of
technical products declined 28.9% and 17.4% during the three months and nine
months ended January 31, 2003, respectively, over the same periods last year, as
the high-tech sector of the economy remained depressed.
During the three months and nine months ended January 31, 2003, the Company
incurred certain non-recurring charges described below. For comparative
purposes, following the disclosure of certain financial measures below which
include the applicable non-recurring charges, the Company has reported the same
financial measures which exclude the applicable non-recurring charges. The
Company has included this additional information because it believes that the
disclosure which excludes the non-recurring charges is a better measure of the
Company's performance during the periods reported and is more useful for
comparing the Company's results of operations to prior periods.
On October 31, 2002, the Company announced its decision to relocate the
operations of its technical products business from Lockhart, Texas to the
Company's site in Statesville, North Carolina and to write-down certain related
inventories on hand. Total pre-tax costs associated with the above activities
are
10
estimated to be approximately $1.1 million. In accordance with existing
accounting rules, $262,000 and $641,000 of these charges were recorded during
the three months and nine months ended January 31, 2003, respectively, with the
remaining balance of the costs expected to be recorded in the fourth quarter of
the current year. The costs for the nine months ended January 31, 2003 included
$200,000 of inventory write-downs of technical products that were recorded as
cost of sales in the financial statements. The additional costs of $262,000 and
$441,000 recorded for the three and nine months ended January 31, 2003,
respectively, were recorded as operating expenses in the financial statements.
During the quarter ending October 31, 2002, the Company recorded to cost of
sales a $250,000 pre-tax charge of accelerated depreciation expense and a
$100,000 pre-tax charge to write-down paint inventories, both associated with
the Company's paint system in Statesville that is being replaced in the current
year with a state-of-the-art, more cost-effective system.
The gross profit margin for the quarter ended January 31, 2003 was 21.1% of
sales, as compared to 17.7% of sales in the comparable quarter of the prior
year. The gross profit margin for the nine months ended January 31, 2003 was
18.0%, as compared to 17.2% in the comparable period of the prior year. The
profit margin for the nine months of the current year was adversely affected by
the non-recurring charges of $350,000 associated with the replacement of the
Company's paint system and the $200,000 of inventory write-downs of technical
products. Excluding these charges, the profit margin for the nine months was
19.0% of sales. The improvements in the profit margins, excluding these charges,
were a reflection of the Company's cost improvement activities.
Operating expenses for the three months ended January 31, 2003 were $3.4
million, or 20.5% of sales, as compared to $3.1 million, or 14.8% of sales, in
the comparable period of the prior year. Operating expenses for the nine months
ended January 31, 2003 were $9.6 million, or 17.3% of sales, as compared to $8.7
million, or 13.8% of sales, in the comparable period of the prior year.
Excluding $262,000 and $441,000 in non-recurring charges associated with the
relocation of the technical products business for the three months and nine
months ended January 31, 2003, respectively, operating expenses for the three
and nine months ended January 31, 2003 were $3.1 million and $9.2 million, or
18.9% and 16.5% of sales, respectively. The increases in operating expenses for
the three months and nine months ended January 31, 2003, excluding the
non-recurring charges, were
11
primarily the inclusion of operating expenses associated with the expansion of
activities in the international marketplace in the current year and increased
sales and marketing expenses.
Operating earnings of $101,000 and $425,000 were recorded for the three months
and nine months ended January 31, 2003, respectively. This compares to operating
earnings of $604,000 and $2.1 million for the comparable periods of the prior
year. Excluding the non-recurring charges discussed above totaling $262,000 and
$991,000, operating earnings for the three and nine months ended January 31,
2003 were $363,000 and $1,416,000, respectively.
Interest expense was $35,000 and $117,000 for the three months and nine months
ended January 31, 2003, respectively, compared to $50,000 and $169,000 for the
comparable periods of the prior year. The decrease in interest expense for the
current quarter and year resulted from lower interest rates and lower borrowing
levels.
Other expense was $24,000 and other income was $44,000, in the three months and
nine months ended January 31, 2003, respectively, compared to other expense of
$6,000 and other income of $32,000 for the comparable periods of the prior year.
No income tax expense was recorded for the three-month period ended January 31,
2003. An income tax expense of $110,000 was recorded for the nine months ended
January 31, 2003. This compares to income tax expense of $132,000 and $651,000
recorded for the comparable periods of the prior year. The effective tax rate
was approximately 31.3% for the nine months ended January 31, 2003 and 24.1% and
32.6% for the three and nine month periods ended January 31, 2002, respectively.
No income tax expense was considered necessary in the current quarter due to the
amount of state income tax credits earned by the Company from investments in
certain qualifying machinery and equipment. Remaining state tax credits for the
current fiscal year are expected to substantially offset the income tax expense
in the fourth quarter.
Net earnings of $42,000 and $242,000, or $.02 per diluted share and $.10 per
diluted share, were recorded for the three months and nine months ended January
31, 2003, respectively. This compares to net earnings of $416,000 and
$1,347,000, or $.17 per diluted share and $.54 per diluted share, respectively,
for the comparable periods of the prior year. Excluding the non-recurring
charges discussed above and their income tax effect, net earnings for the three
and nine months ended January 31, 2003 were $202,000, or $.08 per diluted share,
and $847,000, or $.34 per diluted share, respectively.
12
Liquidity and Capital Resources
Historically, the Company's principal sources of liquidity have been funds
generated from operations, supplemented as needed by short-term borrowings. The
Company believes that these sources, will be sufficient to support ongoing
business levels, including capital expenditures through the current fiscal year.
The Company had working capital of $13.7 million at January 31, 2003, as
compared to $14.8 million at April 30, 2002. The ratio of current assets to
current liabilities was 2.3-to-1 at January 31, 2003, as compared to 2.4-to-1 at
April 30, 2002. At January 31, 2003, advances of $2,275,000 were outstanding
under the Company's revolving credit loan. The balance of borrowings and
accounts receivable in the financial statements at January 31, 2003 were
adversely affected by $2.3 million in customer cash payments that were mailed
prior to the end of the quarter, but not received by the Company until the first
business day after the end of the quarter. During the current quarter, the
revolving credit loan was amended to increase allowable advances under the loan
from $6.0 million to $7.0 million and extend the maturity date of the loan to
December 31, 2004.
The Company's operations provided cash of $416,000 during the nine months ended
January 31, 2003, primarily attributable to operating earnings before
depreciation offset by decreases in accounts payable and other current
liabilities. The Company's operations provided cash of $581,000 during nine
months ended January 31, 2002, primarily attributable to operating earnings
before depreciation, partially offset by an increase in accounts receivable.
During the nine months ended January 31, 2003, the Company used cash of
$2,846,000 in investing activities. This amount was the net of $3,212,000 of
capital expenditures, primarily for production equipment, reduced by the
proceeds of $366,000 from sales of fixed assets. This compares to the use of
$1,347,000 for capital expenditures in the comparable period of the prior year.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Certain statements in this report constitute "forward-looking" statements within
the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform
Act"). Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could significantly impact results or
achievements expressed or implied by such forward-looking statements. These
factors include, but are not limited to,
13
economic, competitive, governmental, and technological factors affecting the
Company's operations, markets, products, services, and prices. The cautionary
statements made pursuant to the Reform Act herein and elsewhere by the Company
should not be construed as exhaustive or as any admission regarding the adequacy
of disclosures made by the Company prior to the effective date of the Reform
Act. The Company cannot always predict what factors would cause actual results
to differ materially from those indicated by the forward-looking statements. In
addition, readers are urged to consider statements that include the terms
"believes", "belief", "expects", "plans", "objectives", "anticipates", "intends"
or the like to be uncertain and forward-looking.
14
REVIEW BY INDEPENDENT ACCOUNTANTS
A review of the interim financial information included in this Quarterly Report
on Form 10-Q for the three months and nine months ended January 31, 2003 has
been performed by PricewaterhouseCoopers LLP, the Company's independent
accountants. Their report on the interim financial information follows.
15
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders of
Kewaunee Scientific Corporation
Statesville, North Carolina
We have reviewed the accompanying condensed consolidated balance sheet of
Kewaunee Scientific Corporation as of January 31, 2003 and April 30, 2002, and
the related condensed consolidated statements of operations for each of the
three and nine-month periods ended January 31, 2003 and January 31, 2002 and the
condensed consolidated statement of cash flows for the nine-month periods ended
January 31, 2003 and January 31, 2002. These financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying condensed consolidated interim financial information
for them to be in conformity with accounting principles generally accepted in
the United States of America.
We previously audited in accordance with auditing standards generally accepted
in the United States of America, the consolidated balance sheet as of April 30,
2002, and the related consolidated statements of operations, of stockholder's
equity, and of cash flows for the year then ended (not presented herein), and in
our report dated June 3, 2002 we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth in
the accompanying condensed consolidated balance sheet as of April 30, 2002 is
fairly stated in all material respects in relation to the consolidated balance
sheet from which it has been derived.
PricewaterhouseCoopers LLP
Charlotte, North Carolina
February 21, 2003
16
Item 3. Quantitative and Qualitative Disclosures About Market Risk
There were no material changes to the disclosures made on this matter in
the Company's Annual Report on Form 10-K for the fiscal year ended April
30, 2002.
Item 4. Controls and Procedures
An evaluation was performed under the supervision and the participation
of the company's management, including the Chief Executive Officer
("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of the
design and operation of the Company's disclosure controls and
procedures. Based on that evaluation, the Company's management,
including the CEO and CFO, concluded the Company's disclosure controls
and procedures were effective as of January 31, 2003, in ensuring that
all material information required to be filed in this quarterly report
has been made known to them in a timely fashion.
There have been no significant changes in the Company's internal
controls or in other factors that could significantly affect internal
controls subsequent to January 31, 2003.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company previously reported that a judgment in the amount of
approximately $1.3 million had been issued against the Company in fiscal
year 2002 associated with a legal dispute between the Company and a
general contractor, Bernards Bros. Inc. The judgment had been issued
after an arbitrator's award of damages against the Company and other
defendants. The Company filed an appeal of the judgment and the Court of
Appeals of the State of California subsequently overturned the judgment
and returned the case to the Trial Court for the limited purpose of
fashioning, with the input of the parties, a judgment which properly
reflects the arbitrator's award in the case. The Trial Court has
17
not yet rendered an opinion; however, the Company feels the case will
ultimately be concluded with a liability to the Company approximating
the amount previously recorded in the financial statements.
Item 5. Other Matters
Consistent with Section 10A(I)(2) of the Securities Exchange Act of
1934, as added by Section 202 of the Public Company Accounting Reform
and Investor Protection Act of 2002, the Company is responsible for
disclosing the nature of non-audit services approved by our Audit
Committee during each quarter to be performed by
PricewaterhouseCoopers LLP, our independent auditors. Non-audit
services are services other than those provided by
PricewaterhouseCoopers LLP in connection with an audit or review of
the Company's financial statements. During the third quarter of fiscal
year 2003 the Company's Audit Committee did not approve any non-audit
services to be performed by PricewaterhouseCoopers LLP.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
99.2 Certification of Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
99.3 Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
99.4 Certification of Chief Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
(b) Reports on Form 8-K
No reports on Form 8-K were filed with the Commission during the
three months ended January 31, 2003.
18
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KEWAUNEE SCIENTIFIC CORPORATION
(Registrant)
Date: March 14, 2003 By /s/ D. Michael Parker
-----------------------
D. Michael Parker
Senior Vice President,Finance
Chief Financial Officer
19