Company: KEQU
Filing Date: 2025-03-14
Form Type: 10-Q
Source: 0000055529-25-000013
Chunk: 60

Company: KEWAUNEE SCIENTIFIC CORP /DE/
Filing Date: 2025-03-14
Form: 10-Q
Item: Part I, Item 8
Chunk 60
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 that subsequently cease to be subject to such awards are available under the 2023 Plan. The 2023 Plan also increased the total number of shares reserved for issuance under the Company's equity compensation plans by 310,000, for a total of 374,633 shares initially reserved for issuance under the 2023 Plan. At January 31, 2025, there were 383,572 shares available for future issuance under the 2023 Plan.In June 2024, the Company granted 47,940 RSUs under the 2023 Plan. These RSUs include both a service and a performance component, vesting over a three-year period. The recognized expense is based upon the vesting period for service criteria and estimated attainment of the performance criteria at the end of the three-year period, based on the ratio of cumulative days of service to total days over the three-year period. The Company recorded stock-based compensation expense of $380,000 and $1,071,000 during the three and nine months ended January 31, 2025 with the remaining estimated stock-based compensation expense of $2,334,000 to be recorded over the remaining vesting periods. The Company recorded stock-based compensation expense of $241,000 and $655,000 during the three and nine months ended January 31, 2024.

N. Income Taxes

Income tax benefit of $108,000 and income tax expense of $1,000,000 were recorded for the three and nine months ended January 31, 2025, respectively. Income tax expense of $982,000 and $3,894,000 were recorded for the three and nine months ended January 31, 2024, respectively. The effective tax rate was (8.5)% and 13.1% for the three and nine months ended January 31, 2025, respectively. The effective tax rate for the current three and nine months periods reflects the impact of foreign operations which are taxed at different rates than the U.S. tax rate of 21%, combined with expected current year tax expense for the Company's domestic operations. In addition, the income tax expense recorded for the nine months ended January 31, 2025 was favorably impacted by a discrete tax benefit of $421,000 resulting from the issuance of stock through the vesting of restricted stock units and the exercise of stock options during the first quarter. The effective tax rate was 27.9% and 33.1% for the three and nine months ended