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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



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FORM 10-Q



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|x | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------------



For the quarterly period ended October 31, 2005



| ̈ | 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



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KEWAUNEE SCIENTIFIC CORPORATION

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                    
|-------------------------------------------------------------- |  | -----------------------------------
|Delaware                                                       |  | 38-0715562                         
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S.Employer 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)



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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 ̈



Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    Yes ̈No  x.



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes ̈No  x.



As of October 5, 2005, the Registrant had outstanding 2,492,270 shares of Common Stock.



Pages: This report, excluding exhibits, contains 18 pages
numbered sequentially from this cover page.



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##### Table of Contents

KEWAUNEE SCIENTIFIC CORPORATION



INDEX TO
FORM 10-Q



FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 2005



|                                                                                                    |  |            
|--------------------------------------------------------------------------------------------------- |  | -----------
|                                                                                                    |  | Page Number
|PART I. FINANCIAL INFORMATION                                                                       |  |            
|                                                                                                    | 
|Item 1. Financial Statements                                                                        |  |            
|                                                                                                    | 
|Consolidated Statements of Operations - Three months and six months ended October 31, 2005 and 2004 |  | 3          
|                                                                                                    | 
|Consolidated Balance Sheets October 31, 2005 and April 30, 2005                                     |  | 4          
|                                                                                                    | 
|Consolidated Statements of Cash Flows - Six months ended October 31, 2005 and 2004                  |  | 5          
|                                                                                                    | 
|Notes to Consolidated Financial Statements                                                          |  | 6          
|                                                                                                    | 
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations       |  | 10         
|                                                                                                    | 
|Review by Independent Registered Public Accounting Firm                                             |  | 14         
|                                                                                                    | 
|Report of Independent Registered Public Accounting Firm                                             |  | 15         
|                                                                                                    | 
|Item 3. Quantitative and Qualitative Disclosures About Market Risk                                  |  | 16         
|                                                                                                    | 
|Item 4. Controls and Procedures                                                                     |  | 16         
|                                                                                                    | 
|PART II. OTHER INFORMATION                                                                          |  |            
|                                                                                                    | 
|Item 4. Submission of Matters to a Vote of Security Holders                                         |  | 17         
|                                                                                                    | 
|Item 6. Exhibits                                                                                    |  | 17         
|                                                                                                    | 
|SIGNATURE                                                                                           |  | 18         



2



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##### Table of Contents

Part 1. Financial Information



Item 1. Financial Statements



Kewaunee Scientific Corporation

Consolidated Statements of Operations

(Unaudited)

(in thousands, except
per share data)



|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|------------------------------------------------------------------- |  | ----------------------------- | ------ | - | --------------------------- | - | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                                                    |  | Three months ended October 31 |        |   | Six months ended October 31 |  
|                                                                    |  | 2005                          |        |   | 2004                        |   |        | 2005 |  |   | 2004   |  
|Net sales                                                           |  | $                             | 22,319 |   |                             | $ | 18,365 |      |  | $ | 42,627 |   |  | $ | 38,653 |  
|Costs of products sold                                              |  |                               | 18,834 |   |                             |   | 14,812 |      |  |   | 35,756 |   |  |   | 31,724 |  
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Gross profit                                                        |  |                               | 3,485  |   |                             |   | 3,553  |      |  |   | 6,871  |   |  |   | 6,929  |  
|Operating expenses                                                  |  |                               | 2,953  |   |                             |   | 3,260  |      |  |   | 5,873  |   |  |   | 6,306  |  
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Operating earnings                                                  |  |                               | 532    |   |                             |   | 293    |      |  |   | 998    |   |  |   | 623    |  
|Other income (expense)                                              |  |                               | 1      |   |                             |   | (6     | )    |  |   | 880    |   |  |   | 40     |  
|Interest expense                                                    |  |                               | (118   | ) |                             |   | (84    | )    |  |   | (205   | ) |  |   | (170   | )
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Earnings before income taxes                                        |  |                               | 415    |   |                             |   | 203    |      |  |   | 1,673  |   |  |   | 493    |  
|Income tax expense                                                  |  |                               | 137    |   |                             |   | 55     |      |  |   | 594    |   |  |   | 155    |  
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Earnings before minority interests                                  |  |                               | 278    |   |                             |   | 148    |      |  |   | 1,079  |   |  |   | 338    |  
|Minority interests                                                  |  |                               | 39     |   |                             |   | 40     |      |  |   | 77     |   |  |   | 37     |  
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Net earnings                                                        |  | $                             | 239    |   |                             | $ | 108    |      |  | $ | 1,002  |   |  | $ | 301    |  
|                                                                    |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Net earnings per share                                              |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Basic                                                               |  | $                             | 0.10   |   |                             | $ | 0.04   |      |  | $ | 0.40   |   |  | $ | 0.12   |  
|Diluted                                                             |  | $                             | 0.10   |   |                             | $ | 0.04   |      |  | $ | 0.40   |   |  | $ | 0.12   |  
|                                                                    |  |                               |        |  
|Weighted average number of common shares outstanding (in thousands) |  |                               |        |   |                             |   |        |      |  |   |        |   |  |   |        |  
|Basic                                                               |  |                               | 2,492  |   |                             |   | 2,492  |      |  |   | 2,492  |   |  |   | 2,491  |  
|Diluted                                                             |  |                               | 2,493  |   |                             |   | 2,494  |      |  |   | 2,493  |   |  |   | 2,497  |  



See accompanying notes to
consolidated financial statements.



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Kewaunee Scientific Corporation

Consolidated Balance Sheets

(in thousands)



|                                           |  |                 |         |   |               |   |         |  
|------------------------------------------ |  | --------------- | ------- | - | ------------- | - | ------- | -
|                                           |  | October 31 2005 |         |   | April 30 2005 |  
|                                           |  | (Unaudited)     |         |   |               |  
|Assets                                     |  |                 |         |   |               |   |         |  
|Current assets:                            |  |                 |         |   |               |   |         |  
|Cash and cash equivalents                  |  | $               | 588     |   |               | $ | 225     |  
|Restricted cash                            |  |                 | 367     |   |               |   | 379     |  
|Receivables, less allowance                |  |                 | 21,058  |   |               |   | 21,683  |  
|Inventories                                |  |                 | 4,342   |   |               |   | 3,542   |  
|Deferred income taxes                      |  |                 | 467     |   |               |   | 456     |  
|Prepaid income taxes                       |  |                 |        |   |               |   | 94      |  
|Prepaid expenses and other current assets  |  |                 | 949     |   |               |   | 401     |  
|                                           |  |                 |         |   |               |   |         |  
|Total current assets                       |  |                 | 27,771  |   |               |   | 26,780  |  
|                                           |  |                
|Property, plant and equipment, at cost     |  |                 | 36,426  |   |               |   | 34,467  |  
|Accumulated depreciation                   |  |                 | (24,815 | ) |               |   | (23,737 | )
|                                           |  |                 |         |   |               |   |         |  
|Net property, plant and equipment          |  |                 | 11,611  |   |               |   | 10,730  |  
|                                           |  |                
|Prepaid pension cost                       |  |                 | 4,824   |   |               |   | 4,731   |  
|Property held for sale                     |  |                 |        |   |               |   | 1,450   |  
|Other                                      |  |                 | 2,739   |   |               |   | 2,521   |  
|                                           |  |                 |         |   |               |   |         |  
|Total other assets                         |  |                 | 7,563   |   |               |   | 8,702   |  
|                                           |  |                
|Total Assets                               |  | $               | 46,945  |   |               | $ | 46,212  |  
|                                           |  |                 |         |   |               |   |         |  
|Liabilities and Stockholders Equity       |  |                 |         |   |               |   |         |  
|Current liabilities:                       |  |                 |         |   |               |   |         |  
|Short-term borrowings                      |  | $               | 5,567   |   |               | $ | 3,778   |  
|Current portion of long-term debt          |  |                 | 372     |   |               |   | 931     |  
|Current obligations under capital leases   |  |                 | 137     |   |               |   | 111     |  
|Accounts payable                           |  |                 | 7,001   |   |               |   | 8,558   |  
|Employee compensation and amounts withheld |  |                 | 1,096   |   |               |   | 1,113   |  
|Deferred Revenue                           |  |                 | 542     |   |               |   | 1,261   |  
|Other accrued expenses                     |  |                 | 1,565   |   |               |   | 647     |  
|                                           |  |                 |         |   |               |   |         |  
|Total current liabilities                  |  |                 | 16,280  |   |               |   | 16,399  |  
|                                           |  |                
|Obligations under capital leases           |  |                 | 314     |   |               |   | 307     |  
|Deferred income taxes                      |  |                 | 384     |   |               |   | 391     |  
|Accrued employee benefit plan costs        |  |                 | 2,717   |   |               |   | 2,524   |  
|Other long-term liabilities                |  |                 |        |   |               |   | 2       |  
|Minority interests                         |  |                 | 662     |   |               |   | 600     |  
|                                           |  |                 |         |   |               |   |         |  
|Total Liabilities                          |  |                 | 20,357  |   |               |   | 20,223  |  
|                                           |  |                
|Stockholders equity:                      |  |                 |         |   |               |   |         |  
|Common stock                               |  |                 | 6,550   |   |               |   | 6,550   |  
|Additional paid-in-capital                 |  |                 | 143     |   |               |   | 144     |  
|Retained earnings                          |  |                 | 20,684  |   |               |   | 20,031  |  
|Accumulated other comprehensive income     |  |                 | (2      | ) |               |   | 54      |  
|Common stock in treasury, at cost          |  |                 | (787    | ) |               |   | (790    | )
|                                           |  |                 |         |   |               |   |         |  
|Total stockholders equity                 |  |                 | 26,588  |   |               |   | 25,989  |  
|                                           |  |                 |         |   |               |   |         |  
|Total Liabilities and Stockholders Equity |  | $               | 46,945  |   |               | $ | 46,212  |  
|                                           |  |                 |         |   |               |   |         |  



See accompanying notes to
consolidated financial statements.



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Kewaunee Scientific Corporation

Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)



|                                                                                |  |                             |        |   |      |   |        |  
|------------------------------------------------------------------------------- |  | --------------------------- | ------ | - | ---- | - | ------ | -
|                                                                                |  | Six months ended October 31 |       
|                                                                                |  | 2005                        |        |   | 2004 |  
|Cash flows from operating activities:                                           |  |                             |        |   |      |   |        |  
|Net earnings                                                                    |  | $                           | 1,002  |   |      | $ | 301    |  
|Adjustments to reconcile net earnings to net cash used in operating activities: |  |                             |        |   |      |   |        |  
|Depreciation                                                                    |  |                             | 1,080  |   |      |   | 1,037  |  
|Provision for bad debts                                                         |  |                             | 31     |   |      |   | 321    |  
|Increase in deferred income tax expense                                         |  |                             | (18    | ) |      |   |       |  
|Gain on sale of property held for sale                                          |  |                             | (884   | ) |      |   |       |  
|Decrease in prepaid income taxes                                                |  |                             | 94     |   |      |   | 165    |  
|Decrease in receivables                                                         |  |                             | 594    |   |      |   | 1,127  |  
|(Increase) decrease in inventories                                              |  |                             | (800   | ) |      |   | 281    |  
|Increase in prepaid pension cost                                                |  |                             | (93    | ) |      |   |       |  
|Increase (decrease) in accounts payable and other current liabilities           |  |                             | 1,645  |   |      |   | (2,226 | )
|Decrease in deferred revenue                                                    |  |                             | (719   | ) |      |   | (166   | )
|Other, net                                                                      |  |                             | (735   | ) |      |   | 1,039  |  
|                                                                                |  |                             |        |   |      |   |        |  
|Net cash provided by operating activities                                       |  |                             | 1,197  |   |      |   | 1,879  |  
|                                                                                |  |                            
|Cash flows from investing activities:                                           |  |                             |        |   |      |   |        |  
|Capital expenditures                                                            |  |                             | (1,869 | ) |      |   | (417   | )
|Proceeds from sale of property held for sale                                    |  |                             | 2,500  |   |      |   |       |  
|Decrease (increase) in restricted cash                                          |  |                             | 12     |   |      |   | (8     | )
|                                                                                |  |                             |        |   |      |   |        |  
|Net cash provided by (used in) investing activities                             |  |                             | 643    |   |      |   | (425   | )
|                                                                                |  |                            
|Cash flows from financing activities:                                           |  |                             |        |   |      |   |        |  
|Decrease in bank overdraft                                                      |  |                             | (2,301 | ) |      |   |       |  
|Increase (decrease) in short-term borrowings                                    |  |                             | 1,789  |   |      |   | (917   | )
|Payments on long-term debt                                                      |  |                             | (559   | ) |      |   | (559   | )
|Payments on capital leases                                                      |  |                             | (59    | ) |      |   |       |  
|Dividends paid                                                                  |  |                             | (349   | ) |      |   | (349   | )
|Proceeds from exercise of stock options (including tax benefit)                 |  |                             | 2      |   |      |   | 13     |  
|                                                                                |  |                             |        |   |      |   |        |  
|Net cash used in financing activities                                           |  |                             | (1,477 | ) |      |   | (1,812 | )
|                                                                                |  |                             |        |   |      |   |        |  
|Increase (decrease) in cash and cash equivalents                                |  |                             | 363    |   |      |   | (358   | )
|                                                                                |  |                            
|Cash and cash equivalents, beginning of period                                  |  |                             | 225    |   |      |   | 805    |  
|                                                                                |  |                             |        |   |      |   |        |  
|Cash and cash equivalents, end of period                                        |  | $                           | 588    |   |      | $ | 447    |  
|                                                                                |  |                             |        |   |      |   |        |  



See accompanying
notes to consolidated financial statements.



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Kewaunee Scientific Corporation

Notes to Consolidated Financial Statements

(unaudited)



A. Financial Information



The unaudited
interim 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, although the Company believes that the disclosures are adequate to make the information presented not misleading.



These interim consolidated financial statements should be read in conjunction with the financial statements and notes included in the Companys 2005 Annual Report to
Stockholders. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year.



The preparation of the financial statements requires management to make certain estimates and assumptions that affect reported amounts and disclosures. Actual results
could differ from those estimates.



Certain prior period amounts have been
reclassified to conform to current classifications. These reclassifications had no impact on the results of operations of the Company.



B. Inventories



Inventories consisted of the following (in thousands):



|                  |  |                  |       |                |   |      
|----------------- |  | ---------------- | ----- | -------------- | - | -----
|                  |  | October 31, 2005 |       | April 30, 2005
|Finished products |  | $                | 1,327 |                | $ | 1,054
|Work in process   |  |                  | 994   |                |   | 929  
|Raw materials     |  |                  | 2,021 |                |   | 1,559
|                  |  |                  |       |                |   |      
|                  |  | $                | 4,342 |                | $ | 3,542
|                  |  |                  |       |                |   |      



For interim reporting, LIFO
inventories are computed based on year-to-date quantities and interim changes in price levels. Changes in quantities and price levels are reflected in the interim financial statements in the period in which they occur.



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C. Balance Sheet



The Companys April 30, 2005 consolidated balance sheet as presented herein is derived from audited financial statements, but does not include all disclosures
required by generally accepted accounting principles.



D. Comprehensive
Income



A reconciliation of net earnings and total comprehensive income
for the three months and six months ended October 31, 2005 and 2004 is as follows (in thousands):



|                                                              |  |                                     |       |   |                                     |   |    
|------------------------------------------------------------- |  | ----------------------------------- | ----- | - | ----------------------------------- | - | ---
|                                                              |  | Three months ended October 31, 2005 |       |   | Three months ended October 31, 2004
|Net earnings                                                  |  | $                                   | 239   |   |                                     | $ | 108
|Change in fair value of cash flow hedge, net of income tax    |  |                                     | 1     |   |                                     |   | 3  
|Change in cumulative foreign currency translation adjustments |  |                                     | (53   | ) |                                     |   | 42 
|                                                              |  |                                     |       |   |                                     |   |    
|Total comprehensive income                                    |  | $                                   | 187   |   |                                     | $ | 153
|                                                              |  |                                    
|                                                              |  | Six months ended October 31, 2005   |       |   | Six months ended October 31, 2004  
|Net earnings                                                  |  | $                                   | 1,002 |   |                                     | $ | 301
|Change in fair value of cash flow hedge, net of income tax    |  |                                     | 2     |   |                                     |   | 7  
|Change in cumulative foreign currency translation adjustments |  |                                     | (58   | ) |                                     |   | 24 
|                                                              |  |                                     |       |   |                                     |   |    
|Total comprehensive income                                    |  | $                                   | 946   |   |                                     | $ | 332



Statement and Financial Accounting
Standards (SFAS) No. 133, Accounting for Derivative Instruments and Hedging Activities, 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 October 31, 2005 that expires February 28, 2006.



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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.



E. Stock Options



The Company accounts for stock options using the intrinsic value method. Under this method no compensation expense is recorded since the
exercise price of the stock options is equal to the market price of the underlying stock on the grant date. Had compensation expense for the stock options issued been determined consistent with Financial Accounting Standards Board (FASB)
Statement No. 123R, Accounting for Stock-Based Compensation, net earnings and net earnings per share would have been reduced (increased) to the following pro forma amounts (in thousands, except per share data):



|                                 |  |                                     |       |   |                                     |   |      |  
|-------------------------------- |  | ----------------------------------- | ----- | - | ----------------------------------- | - | ---- | -
|                                 |  | Three months ended October 31, 2005 |       |   | Three months ended October 31, 2004 |  
|Net earnings as reported         |  | $                                   | 239   |   |                                     | $ | 108  |  
|Pro forma compensation cost      |  |                                     | (3    | ) |                                     |   | (9   | )
|                                 |  |                                     |       |   |                                     |   |      |  
|Net earnings pro forma           |  |                                     | 236   |   |                                     |   | 99   |  
|                                 |  |                                    
|Net earnings per share  Basic   |  |                                     |       |   |                                     |   |      |  
|As reported                      |  | $                                   | 0.10  |   |                                     | $ | 0.04 |  
|Pro forma                        |  |                                     | 0.09  |   |                                     |   | 0.04 |  
|                                 |  |                                    
|Net earnings per share  Diluted |  |                                     |       |   |                                     |   |      |  
|As reported                      |  | $                                   | 0.10  |   |                                     | $ | 0.04 |  
|Pro forma                        |  |                                     | 0.09  |   |                                     |   | 0.04 |  
|                                 |  |                                    
|                                 |  | Six months ended October 31, 2005   |       |   | Six months ended October 31, 2004   |  
|Net earnings as reported         |  | $                                   | 1,002 |   |                                     | $ | 301  |  
|Pro forma compensation cost      |  |                                     | (6    | ) |                                     |   | (17  | )
|                                 |  |                                     |       |   |                                     |   |      |  
|Net earnings pro forma           |  |                                     | 996   |   |                                     |   | 284  |  
|                                 |  |                                    
|Net earnings per share  Basic   |  |                                     |       |   |                                     |   |      |  
|As reported                      |  | $                                   | 0.40  |   |                                     | $ | 0.12 |  
|Pro forma                        |  |                                     | 0.40  |   |                                     |   | 0.11 |  
|                                 |  |                                    
|Net earnings per share  Diluted |  |                                     |       |   |                                     |   |      |  
|As reported                      |  | $                                   | 0.40  |   |                                     | $ | 0.12 |  
|Pro forma                        |  |                                     | 0.40  |   |                                     |   | 0.11 |  



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F. Defined Pension Plans



The Company has non-contributory defined benefit pension plans covering substantially all salaried and hourly employees. Effective April 30, 2005, no further
benefits will be earned under the plans and no additional participants will be added to the plans. No contributions were paid to the plans during the six months ended October 31, 2005, and the Company does not expect any contributions to be
paid to the plans during the remainder of the current year.



Pension expense (income) consisted of the following (in thousands):



|                                    |  |                                     |      |   |                                     |   |      |  
|----------------------------------- |  | ----------------------------------- | ---- | - | ----------------------------------- | - | ---- | -
|                                    |  | Three months ended October 31, 2005 |      |   | Three months ended October 31, 2004 |  
|Service Cost                        |  | $                                   | -0-  |   |                                     | $ | 129  |  
|Interest Cost                       |  |                                     | 201  |   |                                     |   | 213  |  
|Expected return on plan assets      |  |                                     | (309 | ) |                                     |   | (251 | )
|Amortization of prior service costs |  |                                     | -0-  |   |                                     |   | 3    |  
|Recognition of net loss             |  |                                     | 71   |   |                                     |   | 59   |  
|                                    |  |                                     |      |   |                                     |   |      |  
|Net periodic pension cost (income)  |  | $                                   | (37  | ) |                                     | $ | 153  |  
|                                    |  |                                    
|                                    |  | Six months ended October 31, 2005   |      |   | Six months ended October 31, 2004   |  
|Service Cost                        |  | $                                   | -0-  |   |                                     | $ | 258  |  
|Interest Cost                       |  |                                     | 396  |   |                                     |   | 426  |  
|Expected return on plan assets      |  |                                     | (620 | ) |                                     |   | (502 | )
|Amortization of prior service costs |  |                                     | -0-  |   |                                     |   | 6    |  
|Recognition of net loss             |  |                                     | 131  |   |                                     |   | 118  |  
|                                    |  |                                     |      |   |                                     |   |      |  
|Net periodic pension cost (income)  |  | $                                   | (93  | ) |                                     | $ | 306  |  



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Item 2. Managements Discussion and Analysis

of Financial Condition and Results of Operations



The Companys 2005 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, 2005. The following discussion and analysis describes material changes in the Companys financial condition since April 30,
2005. The analysis of results of operations compares the three months and six months ended October 31, 2005 with the comparable periods of the prior fiscal year.



Results of Operations



Sales for the three months ended October 31, 2005 were $22,319,000, an increase of 21.5% from sales of $18,365,000 for the comparable
period of the prior year. Sales for the six months ended October 31, 2005 were $42,627,000, an increase of 10.3% from sales of $38,653,000 in the comparable period of the prior year. The total order backlog was $35.2 million at October 31,
2005. This compares to $40.7 million at July 31, 2005 and $38.6 million at October 31, 2004.



The gross profit margin for the three months ended October 31, 2005 was 15.6% of sales, as compared to 19.3% of sales in the comparable quarter of the prior year. The gross profit margin for the six months ended
October 31, 2005 was 16.1%, as compared to 17.9% in the comparable period of the prior year. Gross profit margins for the three and six months of the current year were unfavorably impacted by aggressive pricing in the marketplace and higher raw
material, energy and transportation costs.



Operating expenses for the three
months ended October 31, 2005 were $3.0 million, or 13.2% of sales, as compared to $3.3 million, or 17.8% of sales, in the comparable period of the prior year. Operating expenses for the six months ended October 31, 2005 were $5.9 million,
or 13.8% of sales, as compared to $6.3 million, or 16.3% of sales, in the comparable period of the prior year. The decrease in operating expenses as a percent of sales for each of the current year periods resulted from reduced bad debt expense in
the current year periods and higher sales volumes in the current year periods without a proportionate increase in other operating expenses. As compared to the prior year periods, bad debt expense declined $245,000 and $290,000 for the three months
and six months ended October 31, 2005, respectively.



Operating earnings
of $532,000 and $998,000 were recorded for the three months and six months ended October 31, 2005, respectively, compared to $293,000 and $623,000 recorded for the comparable periods of the prior year.



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Interest expense was $118,000 and $205,000 for the three months and six months ended October 31, 2005, respectively,
compared to $84,000 and $170,000 for the same periods of the prior year. The increase in interest expense for the current year periods resulted from higher interest rates, which was partially offset by lower borrowing levels in the current year.



Other income was $1,000 and $880,000 in the three months and six months ended
October 31, 2005, respectively, compared to other expense of $6,000 and other income of $40,000 for the comparable periods of the prior year. Other income for the six months ended October 31, 2005, included $884,000 from the sale of the
Companys Lockhart, Texas property in the first quarter.



Income tax
expenses of $137,000 and $594,000 were recorded for the three months and six months ended October 31, 2005, respectively, as compared to an income tax expense of $55,000 and $155,000 recorded for the comparable periods of the prior year. The
effective tax rate was 33.0% and 35.5% for the three and six months ended October 31, 2005 and was 27.1% and 31.4% for the three months and six months ended October 31, 2004, respectively. The effective tax rate for each of these periods
differs from the statutory rate due to the impact of state and federal tax credits on the different levels of taxable earnings for the periods.



Minority interest related to the Companys two subsidiaries that are not 100% owned by the Company reduced net earnings by $39,000 and $77,000 for the three and six
months ended October 31, 2005, respectively, as compared to minority interest expense of $40,000 and $37,000 during the comparable periods of the prior year.



Net earnings of $239,000, or $.10 per diluted share, and $1,002,000, or $.40 per diluted share, were recorded for the three and six months
ended October 31, 2005, respectively. This compares to net earnings of $108,000, or $.04 per diluted share, and $301,000, or $.12 per diluted share, for the three and six month periods of the prior year. Net earnings for the six months ended
October 31, 2005 included an after-tax gain of $540,000, or $.22 per diluted share, resulting from the sale of the Companys former plant site in Lockhart, Texas.



Liquidity and Capital Resources



Historically, the Companys principal sources of liquidity have been funds generated from operations, supplemented as needed by
short-term



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borrowings under the Companys revolving credit facility. Additionally, certain machinery and equipment are financed
by non-cancelable operating leases or capital leases. The Company believes that these sources will be sufficient to support ongoing business requirements, including capital expenditures through the current fiscal year.



The Company had working capital of $11.5 million at October 31, 2005, as compared to
$10.4 million at April 30, 2005. The ratio of current assets to current liabilities was 1.7-to-1 at October 31, 2005, as compared to 1.6-to-1 at April 30, 2005. At October 31, 2005, advances of $5,567,000 were outstanding under
the Companys revolving credit loan, leaving available credit under this line in the amount of $3,433,000.



The Companys operations provided cash of $1,197,000 during the six months ended October 31, 2005. Cash was provided primarily from operations, a decrease in
accounts receivable, and increases in accounts payable and other current liabilities. The favorable impact of these items was partially offset by cash requirements resulting from an increase in inventories and a decrease in deferred revenue. The
Companys operations provided cash of $1,879,000 during the six months ended October 31, 2004, primarily from operations and decreases in accounts receivable. Cash of $890,000 was also received during the comparable period of the prior
year from the cancellation of life insurance policies covering all salaried employees when these policies were replaced with a group term insurance plan. Cash of $2,226,000 was used for the reduction of accounts payable and other current liabilities
during the six months ended October 31, 2004.



During the six months ended
October 31, 2005, net cash of $643,000 was provided by investing activities, primarily from the proceeds of the sale of the Companys former plant site in Lockhart, Texas, reduced by $1,869,000 of capital expenditures. This compares to the
use of $425,000 for investing activities in the same period of the prior year, primarily for capital expenditures.



The Companys financing activities used cash of $1,477,000 during the six months ended October 31, 2005. Cash used included $2,301,000 to reduce bank
overdrafts, reported as a component of accounts payable, $559,000 for scheduled repayments of long-term debt, and $349,000 for cash dividends. The impact of these items was partially offset by cash of $1,789,000 provided from advances under the
revolving credit loan. Financing activities used cash of $1,812,000 in the same period of the prior year. This included $917,000 for repayment of advances under the revolving credit loan, scheduled long-term debt repayments of $559,000, and cash
dividends paid of $349,000.



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Outlook for Remainder of Fiscal Year 2006



In addition to general economic factors affecting the Company and its markets, demand for
the Companys products is also dependent upon the number of laboratory construction projects planned and/or current progress in projects already under construction. The Companys ability to predict future demand is very limited given,
among other general economic factors affecting the Company and its markets, the Companys role as subcontractor or supplier to dealers of subcontractors.



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, 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.



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REVIEW BY INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



A review of the interim financial information included in this Quarterly Report on Form 10-Q for the three months and six months ended October 31, 2005 has been performed by Cherry, Bekaert & Holland LLP, the Companys
independent auditors. Their report on the interim financial information follows.



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors and Stockholders of

Kewaunee Scientific Corporation

Statesville, North Carolina



We have reviewed
the accompanying consolidated balance sheet of Kewaunee Scientific Corporation and its subsidiaries (the Company) as of October 31, 2005, and the related consolidated statements of operations for the three-month and six-month
periods ended October 31, 2005, and the consolidated statements of cash flows for the six-month period ended October 31, 2005. These interim financial statements are the responsibility of the companys management.



We conducted our review in accordance with the standards of the Public Company Accounting
Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), 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 consolidated interim financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America.



Cherry, Bekaert & Holland LLP

Charlotte, North Carolina

December 7, 2005



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Item 3. Quantitative and Qualitative Disclosures About Market Risk



There are 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, 2005.



Item 4. Controls and Procedures



(a) Evaluation of disclosure 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 (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of October 31, 2005. Based on that evaluation, the
Companys management, including the CEO and CFO, concluded that, as of October 31, 2005, the Companys disclosure controls and procedures were adequate and effective and designed to ensure that all material information required to be
filed in this quarterly report is made known to them by others within the Company and its subsidiaries.



(b) Changes in internal controls



There were no significant changes in the Companys internal controls or in other factors that could significantly affect these controls subsequent to
October 31, 2005. As no significant deficiencies or material weaknesses were found, no corrective actions were taken.



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PART II. OTHER INFORMATION



Item 4. Submission of Matters to a Vote of Security Holders



The Companys Annual Meeting of Stockholders was held on August 24, 2005. Information regarding the results of this meeting are incorporated by reference from the Companys Report on Form 10-Q for the
three months ended July 31, 2005.



Item 6. Exhibits and Reports on Form 8-K



|       |  |                                                                                                                                                   
|------ |  | --------------------------------------------------------------------------------------------------------------------------------------------------
|10.30  |  | Kewaunee Scientific Corporation Executive Severance Pay Policy                                                                                    
|       | 
|10.38B |  | First Amendment to the Change of Control Agreement between William A. Shumaker and the Company.                                                   
|       | 
|10.39B |  | First Amendment to the Change of Control Agreement between D. Michael Parker and the Company.                                                     
|       | 
|10.40B |  | First Amendment to the Change of Control Agreement between Dana L. Dahlgren and the Company.                                                      
|       | 
|10.41B |  | First Amendment to the Change of Control Agreement between Kurt P. Rindoks and the Company.                                                       
|       | 
|10.44B |  | First Amendment to the Change of Control Agreement between Keith D. Smith and the Company.                                                        
|       | 
|31.1   |  | 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.
|       | 
|31.2   |  | 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.
|       | 
|32.1   |  | 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.
|       | 
|32.2   |  | 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.



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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: December 14, 2005 |  | By                                           |  | /s/ D. Michael Parker             
|                        |  |                                              |  | D. Michael Parker                 
|                        |  |                                              |  | Senior Vice President, Finance and
|                        |  |                                              |  | Chief Financial Officer           



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