Company: KEQU
Filing Date: 2025-07-02
Form Type: 10-K
Source: 0000055529-25-000026
Chunk: 146

Company: KEWAUNEE SCIENTIFIC CORP /DE/
Filing Date: 2025-07-02
Form: 10-K
Item: Item 1A
Chunk 146
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 $51.1 million and $33.8 million in fiscal years 2025 and 2024, respectively, and 21.2% and 16.6% of sales, respectively. 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. 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. 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. 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. 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. 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.

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.

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 income tax expense for fiscal year 2025 reflects the impact of foreign operations, which are taxed at different rates than the US tax rate