Kadant Reports 2019 Second Quarter Results

July 30, 2019 at 4:23 PM EDT

Reports Record Revenue and Increases EPS Guidance for FY 2019

WESTFORD, Mass., July 30, 2019 (GLOBE NEWSWIRE) -- Kadant Inc. (NYSE: KAI) reported its financial results for the second quarter ended June 29, 2019.

Second Quarter 2019 Highlights

  • Revenue increased 14% to a record $177 million
  • GAAP diluted EPS increased 31% to $1.42
  • Adjusted diluted EPS increased 33% to $1.42
  • Net income increased 32% to $16 million
  • Adjusted EBITDA increased 25% to $33 million and represented 18.5% of revenue
  • Gross margin was 42.0%
  • Bookings decreased 1% to $174 million

Note: Adjusted diluted EPS, adjusted EBITDA, and adjusted EBITDA margin are non-GAAP financial measures that exclude certain items as detailed later in this press release under the heading “Use of Non-GAAP Financial Measures.”

Management Commentary
“The excellent start we had to 2019 continued in the second quarter with record revenue and a solid EPS guidance beat,” said Jeffrey L. Powell, president and chief executive officer. “Despite foreign currency headwinds and weakening demand in Asia, we achieved good internal revenue growth from our legacy businesses and solid performance from our recent material handling acquisition leading to record revenue of $177 million in the second quarter of 2019.

“Strong operating performance across our businesses led to our near record adjusted EBITDA of $33 million and cash flow from operations of $23 million in the second quarter of 2019. Our end-markets continue to show resiliency and discipline as they balance supply with demand, with the exception of China where market demand is weak and project activity has slowed.

“Our parts and consumables revenue and bookings in the first half of 2019 were excellent with the second quarter performance just as strong as the first quarter, and up 18 percent and 14 percent, respectively, compared to the second quarter of 2018. As a key component of our business strategy, I am pleased to see this outstanding performance in our after-market business.”

Second Quarter 2019 Results
Revenue increased 14 percent to $177.2 million compared to the second quarter of 2018, including $20.2 million from an acquisition and a $5.7 million decrease from the unfavorable effect of foreign currency translation. Excluding the impact of an acquisition and foreign currency translation, revenue increased five percent compared to the second quarter of 2018. Gross margin was 42.0 percent, including a 70 basis point negative impact from the amortization of acquired profit in inventory. Net income was $16.3 million, or $1.42 per diluted share, in the second quarter of 2019 compared to $12.3 million, or $1.08 per diluted share in the second quarter of 2018. Adjusted diluted EPS increased 33 percent to $1.42 compared to $1.07 in the second quarter of 2018. Adjusted diluted EPS in the second quarter of 2019 excludes $0.10 of amortization expense from acquired profit in inventory and backlog and a $0.10 tax benefit related to changing our permanently reinvested position on a portion of our European earnings. Adjusted diluted EPS in the second quarter of 2018 excludes $0.04 of restructuring costs and a $0.05 tax benefit related to the repatriation of foreign earnings.

Adjusted EBITDA increased 25 percent to $32.7 million compared to $26.1 million in the second quarter of 2018. Adjusted EBITDA excludes $1.5 million of amortization from acquired profit in inventory and backlog from our recent acquisition in the second quarter of 2019 and $0.6 million of restructuring costs in the second quarter of 2018. Cash flows from operations decreased 20 percent to $22.6 million compared to $28.4 million in the second quarter of 2018. Bookings decreased one percent to $174.0 million compared to $176.4 million in the second quarter of 2018, including $21.9 million from an acquisition and a $6.0 million decrease from the unfavorable effect of foreign currency translation. Excluding the impact of an acquisition and foreign currency translation, bookings decreased 10 percent compared to our best second quarter ever in 2018.

Summary and Outlook
“We are encouraged by our strong performance in the first half of the year, despite the global trade uncertainty, the unfavorable effect of foreign currency translation, and weaker end-market demand in certain sectors,” Mr. Powell continued. “For 2019, we are reaffirming our revenue guidance and raising both our GAAP and adjusted diluted EPS guidance. We now expect to achieve GAAP diluted EPS of $4.97 to $5.09, raised from our previous guidance of $4.84 to $4.99, on revenue of $700 to $710 million. The 2019 guidance includes pre-tax amortization expense associated with acquired profit in inventory and backlog of $4.9 million, or $0.33 per diluted share, pre-tax acquisition costs of $0.8 million, or $0.06 per diluted share, and a tax benefit of $1.2 million, or $0.10 per diluted share. Excluding these items, we expect adjusted diluted EPS of $5.26 to $5.38 for 2019 raised from our previous guidance of $5.20 to $5.35.

“For the third quarter of 2019, we expect GAAP diluted EPS of $1.19 to $1.25 on revenue of $170 to $174 million. The third quarter of 2019 guidance includes pre-tax amortization expense associated with acquired backlog of $0.1 million, or $0.01 per diluted share. Excluding this expense, we expect adjusted diluted EPS of $1.20 to $1.26 for the third quarter of 2019.”

Conference Call
Kadant will hold a webcast with a slide presentation for investors on Wednesday, July 31, 2019, at 11:00 a.m. eastern time to discuss its second quarter performance, as well as future expectations. To access the webcast, including the slideshow and accompanying audio, go to www.kadant.com and click on “Investors.” To listen to the webcast via teleconference, call 888-326-8410 within the U.S., or +1-704-385-4884 outside the U.S. and reference participant passcode 7699788. Prior to the call, our earnings release and the slides used in the webcast presentation will be filed with the Securities and Exchange Commission and will be available at www.sec.gov. An archive of the webcast presentation will be available on our website until August 30, 2019.

Shortly after the webcast, Kadant will post its updated general investor presentation incorporating the second quarter results on its website at www.kadant.com under the “Investors” section.

Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures, including increases or decreases in revenue excluding the effect of acquisitions and foreign currency translation, adjusted operating income, adjusted net income, adjusted diluted earnings per share (EPS), earnings before interest, taxes, depreciation, and amortization (EBITDA), adjusted EBITDA, and adjusted EBITDA margin. 

We believe these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our core business, operating results, or future outlook. We believe that the inclusion of such measures helps investors gain an understanding of our underlying operating performance and future prospects, consistent with how management measures and forecasts our performance, especially when comparing such results to previous periods or forecasts and to the performance of our competitors. Such measures are also used by us in our financial and operating decision-making and for compensation purposes. We also believe this information is responsive to investors' requests and gives them an additional measure of our performance.
           
The non-GAAP financial measures included in this press release are not meant to be considered superior to or a substitute for the results of operations prepared in accordance with GAAP. In addition, the non-GAAP financial measures included in this press release have limitations associated with their use as compared to the most directly comparable GAAP measures, in that they may be different from, and therefore not comparable to, similar measures used by other companies.

Revenue included $20.2 million and $40.8 million from an acquisition in the second quarter and first six months of 2019, respectively. Revenue also included a $5.7 million and $12.7 million unfavorable foreign currency translation effect in the second quarter and first six months of 2019, respectively. We present increases or decreases in revenue excluding the effect of acquisitions and foreign currency translation to provide investors insight into underlying revenue trends.
                       
Our non-GAAP financial measures exclude restructuring costs, acquisition costs, amortization expense related to acquired profit in inventory and backlog, and discrete tax items. These items are excluded as they are not indicative of our core operating results and are not comparable to other periods, which have differing levels of incremental costs or income or none at all.

Second Quarter
Adjusted operating income, adjusted EBITDA, and adjusted EBITDA margin exclude:

  • Pre-tax expense related to amortization of acquired profit in inventory and backlog of $1.5 million in 2019.
  • Pre-tax restructuring costs of $0.6 million in 2018.

Adjusted net income and adjusted diluted EPS exclude:

  • After-tax expense related to amortization of acquired profit in inventory and backlog of $1.2 million ($1.5 million net of tax of $0.3 million) in 2019.
  • A discrete tax benefit of $1.2 million in 2019.
  • After-tax restructuring costs of $0.4 million ($0.6 million net of tax of $0.2 million) in 2018.
  • A discrete tax benefit of $0.6 million in 2018.

First Six Months
Adjusted operating income, adjusted EBITDA, and adjusted EBITDA margin exclude:

  • Pre-tax acquisition costs of $0.8 million in 2019.
  • Pre-tax expense related to amortization of acquired profit in inventory and backlog of $4.8 million in 2019.
  • Pre-tax restructuring costs of $1.3 million in 2018.
  • Pre-tax expense related to acquired backlog of $0.3 million in 2018.

Adjusted net income and adjusted diluted EPS exclude:

  • After-tax acquisition costs of $0.7 million ($0.8 million net of tax of $0.1 million) in 2019.
  • After-tax expense related to amortization of acquired profit in inventory and backlog of $3.7 million ($4.8 million net of tax of $1.1 million) in 2019.
  • A discrete tax benefit of $1.2 million in 2019.
  • After-tax restructuring costs of $1.0 million ($1.3 million net of tax of $0.3 million) in 2018.
  • After-tax expense related to acquired backlog of $0.2 million ($0.3 million net of tax of $0.1 million) in 2018.
  • A discrete tax benefit of $0.1 million in 2018.

Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in this press release.

                       
  Financial Highlights (unaudited)                
  (In thousands, except per share amounts and percentages)                
                       
        Three Months Ended   Six Months Ended  
  Consolidated Statement of Income June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  Revenues $   177,165     $   154,913     $   348,481     $   304,106    
                       
  Costs and Operating Expenses:                
    Cost of revenues     102,794         86,749         203,595         169,863    
    Selling, general, and administrative expenses     48,467         45,132         97,786         90,908    
    Research and development expenses     2,762         2,728         5,383         5,597    
    Restructuring costs     -          569         -          1,339    
          154,023         135,178         306,764         267,707    
                       
  Operating Income     23,142         19,735         41,717         36,399    
  Interest Income     59         122         115         305    
  Interest Expense     (3,573 )       (1,850 )       (7,077 )       (3,582 )  
  Other Expense, Net     (99 )       (245 )       (198 )       (491 )  
                       
  Income Before Provision for Income Taxes     19,529         17,762         34,557         32,631    
  Provision for Income Taxes     3,128         5,271         7,091         9,132    
                       
  Net Income     16,401         12,491         27,466         23,499    
  Net Income Attributable to Noncontrolling Interest     (97 )       (142 )       (262 )       (292 )  
  Net Income Attributable to Kadant $   16,304     $   12,349     $   27,204     $   23,207    
                       
  Earnings per Share Attributable to Kadant:                
      Basic $   1.46     $   1.11     $   2.44     $   2.10    
      Diluted $   1.42     $   1.08     $   2.38     $   2.04    
                       
  Weighted Average Shares:                
      Basic     11,194         11,092         11,164         11,067    
      Diluted     11,448         11,400         11,416         11,371    
                       
        Three Months Ended   Three Months Ended  
  Adjusted Net Income and Adjusted Diluted EPS (a) June 29, 2019   June 29, 2019   June 30, 2018   June 30, 2018  
  Net Income and Diluted EPS Attributable to Kadant, as Reported $   16,304     $   1.42     $   12,349     $   1.08    
  Adjustments for the Following:                
    Restructuring Costs, Net of Tax     -          -          432         0.04    
    Amortization of Acquired Profit in Inventory and Backlog, Net of Tax (e,f)     1,158         0.10         -          -     
    Discrete Tax Items     (1,186 )       (0.10 )       (574 )       (0.05 )  
  Adjusted Net Income and Adjusted Diluted EPS (a) $   16,276     $   1.42     $   12,207     $   1.07    
                       
        Six Months Ended   Six Months Ended  
        June 29, 2019   June 29, 2019   June 30, 2018   June 30, 2018  
                       
  Net Income and Diluted EPS Attributable to Kadant, as Reported $   27,204     $   2.38     $   23,207     $   2.04    
  Adjustments for the Following:                
    Restructuring Costs, Net of Tax     -          -          1,021         0.09    
    Acquisition Costs, Net of Tax     699         0.06         -          -     
    Amortization of Acquired Profit in Inventory and Backlog, Net of Tax (e,f)     3,671         0.32         189         0.02    
    Discrete Tax Items     (1,186 )       (0.10 )       (130 )       (0.01 )  
  Adjusted Net Income and Adjusted Diluted EPS (a) $   30,388     $   2.66     $   24,287     $   2.14    
                       
                     Increase   
                     (Decrease)   
                     Excluding   
        Three Months Ended    Increase (Decrease)    Acquisition  
  Revenues by Product Line June 29, 2019   June 30, 2018     and FX (a,b)  
  Stock-Preparation $   50,817     $   56,376     $   (5,559 )   $   (3,476 )  
  Fluid-Handling     34,713         32,531         2,182         3,339    
  Doctoring, Cleaning, & Filtration     30,560         29,543         1,017         1,980    
    Papermaking Systems     116,090         118,450         (2,360 )       1,843    
    Wood Processing Systems     37,869         33,152         4,717         6,228    
    Material Handling Systems     20,197         -          20,197         -     
    Fiber-Based Products     3,009         3,311         (302 )       (302 )  
                       
        $   177,165     $   154,913     $   22,252     $   7,769    
                       
                     Increase   
                     (Decrease)   
                     Excluding   
        Six Months Ended    Increase (Decrease)    Acquisition  
        June 29, 2019   June 30, 2018     and FX (a,b)  
                       
  Stock-Preparation $   102,865     $   101,859     $   1,006     $   5,653    
  Fluid-Handling     67,467         65,417         2,050         4,546    
  Doctoring, Cleaning, & Filtration     58,950         56,765         2,185         4,278    
    Papermaking Systems     229,282         224,041         5,241         14,477    
    Wood Processing Systems     71,918         72,293         (375 )       3,111    
    Material Handling Systems     40,781         -          40,781         -     
    Fiber-Based Products     6,500         7,772         (1,272 )       (1,272 )  
        $   348,481     $   304,106     $   44,375     $   16,316    
                       
                     Increase   
                     (Decrease)   
                     Excluding   
        Three Months Ended    Increase (Decrease)    Acquisition  
  Revenues by Geography (c) June 29, 2019   June 30, 2018     and FX (a,b)  
  North America $   98,667     $   75,375     $   23,292     $   5,782    
  Europe     43,813         45,032         (1,219 )       1,399    
  Asia     23,696         25,502         (1,806 )       (1,135 )  
  Rest of World     10,989         9,004         1,985         1,723    
        $   177,165     $   154,913     $   22,252     $   7,769    
                       
                     Increase   
                     (Decrease)   
                     Excluding   
        Six Months Ended    Increase (Decrease)    Acquisition  
        June 29, 2019   June 30, 2018     and FX (a,b)  
                       
  North America $   199,543     $   152,991     $   46,552     $   11,585    
  Europe     82,798         86,525         (3,727 )       2,138    
  Asia     40,774         45,650         (4,876 )       (3,778 )  
  Rest of World     25,366         18,940         6,426         6,371    
        $   348,481     $   304,106     $   44,375     $   16,316    
                       
                     Increase   
                     (Decrease)   
                     Excluding   
        Three Months Ended    Increase (Decrease)    Acquisition  
  Bookings by Product Line June 29, 2019   June 30, 2018     and FX (b)  
  Stock-Preparation $   52,296     $   61,217     $   (8,921 )   $   (6,576 )  
  Fluid-Handling     31,709         37,922         (6,213 )       (5,062 )  
  Doctoring, Cleaning, & Filtration     28,985         30,484         (1,499 )       (481 )  
    Papermaking Systems     112,990         129,623         (16,633 )       (12,119 )  
    Wood Processing Systems     36,558         44,404         (7,846 )       (6,356 )  
    Material Handling Systems     21,941         -          21,941         -     
    Fiber-Based Products     2,471         2,393         78         78    
        $   173,960     $   176,420     $   (2,460 )   $   (18,397 )  
                       
                     Decrease   
                     Excluding   
        Six Months Ended    Increase (Decrease)    Acquisition  
        June 29, 2019   June 30, 2018     and FX (b)  
                       
  Stock-Preparation $   108,124     $   117,732     $   (9,608 )   $   (4,446 )  
  Fluid-Handling     68,748         77,692         (8,944 )       (6,146 )  
  Doctoring, Cleaning, & Filtration     56,681         58,815         (2,134 )       (48 )  
    Papermaking Systems     233,553         254,239         (20,686 )       (10,640 )  
    Wood Processing Systems     71,440         97,133         (25,693 )       (21,998 )  
    Material Handling Systems     46,416         -          46,416         -     
    Fiber-Based Products     6,163         6,968         (805 )       (805 )  
        $   357,572     $   358,340     $   (768 )   $   (33,443 )  
                       
                       
        Three Months Ended   Six Months Ended  
  Business Segment Information  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  Gross Margin:                
      Papermaking Systems   44.1 %     45.3 %     44.1 %     45.4 %  
      Wood Processing Systems   42.6 %     38.9 %     42.1 %     39.2 %  
      Material Handling Systems   27.9 %       -        25.2 %       -     
      Fiber-Based Products   47.5 %     50.0 %     49.1 %     53.5 %  
          42.0 %     44.0 %     41.6 %     44.1 %  
                       
  Operating Income:                
      Papermaking Systems $   20,061     $   20,899     $   38,570     $   35,483    
      Wood Processing Systems     8,801         5,313         16,071         12,676    
      Material Handling Systems     488         -          (865 )       -     
      Corporate and Other     (6,208 )       (6,477 )       (12,059 )       (11,760 )  
        $   23,142     $   19,735     $   41,717     $   36,399    
                       
  Adjusted Operating Income (a,d):                
      Papermaking Systems $   20,061     $   21,468     $   38,570     $   36,822    
      Wood Processing Systems     8,801         5,313         16,071         12,928    
      Material Handling Systems     2,011         -          4,809         -     
      Corporate and Other     (6,208 )       (6,477 )       (12,059 )       (11,760 )  
        $   24,665     $   20,304     $   47,391     $   37,990    
                       
  Capital Expenditures:                
      Papermaking Systems $   1,157     $   3,840     $   2,514     $   8,489    
      Wood Processing Systems     428         1,184         979         1,560    
      Material Handling Systems     342         -          380         -     
      Corporate and Other     48         36         270         162    
        $   1,975     $   5,060     $   4,143     $   10,211    
                       
        Three Months Ended   Six Months Ended  
  Cash Flow and Other Data June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  Cash Provided by Operations  $   22,612     $   28,355     $   32,488     $   35,571    
  Depreciation and Amortization Expense     8,310         5,844         16,541         11,943    
                       
  Balance Sheet Data         June 29, 2019   Dec. 29, 2018  
  Assets                
  Cash, Cash Equivalents, and Restricted Cash         $   58,138     $   46,117    
  Accounts Receivable, net             106,202         92,624    
  Inventories             109,788         86,373    
  Unbilled Revenues             13,728         15,741    
  Property, Plant, and Equipment, net             86,586         80,157    
  Intangible Assets             186,390         113,347    
  Goodwill             340,191         258,174    
  Other Assets             64,768         33,216    
                $   965,791     $   725,749    
  Liabilities and Stockholders' Equity                
  Accounts Payable         $   41,974     $   35,720    
  Debt Obligations             340,166         171,434    
  Other Borrowings             6,623         4,387    
  Other Liabilities             176,468         139,637    
    Total Liabilities             565,231         351,178    
    Stockholders' Equity             400,560         374,571    
                $   965,791     $   725,749    
                       
  Adjusted Operating Income and Adjusted EBITDA Three Months Ended   Six Months Ended  
  Reconciliation  June 29, 2019   June 30, 2018   June 29, 2019   June 30, 2018  
  Consolidated                
      Net Income Attributable to Kadant $   16,304     $   12,349     $   27,204     $   23,207    
      Net Income Attributable to Noncontrolling Interest     97         142         262         292    
      Provision for Income Taxes     3,128         5,271         7,091         9,132    
      Interest Expense, Net     3,514         1,728         6,962         3,277    
      Other Expense, Net     99         245         198         491    
      Operating Income     23,142         19,735         41,717         36,399    
      Restructuring Costs     -          569         -          1,339    
      Acquisition Costs     -          -          843         -     
      Acquired Backlog Amortization (e)     284         -          1,282         252    
      Acquired Profit in Inventory (f)     1,239         -          3,549         -     
      Adjusted Operating Income (a)     24,665         20,304         47,391         37,990    
      Depreciation and Amortization     8,026         5,844         15,259         11,691    
      Adjusted EBITDA (a) $   32,691     $   26,148     $   62,650     $   49,681    
      Adjusted EBITDA Margin (a,g)   18.5 %     16.9 %     18.0 %     16.3 %  
                       
  Papermaking Systems                 
      Operating Income $   20,061     $   20,899     $   38,570     $   35,483    
      Restructuring costs      -          569         -          1,339    
      Adjusted Operating Income (a)     20,061         21,468         38,570         36,822    
      Depreciation and Amortization     3,211         3,139         6,399         6,275    
      Adjusted EBITDA (a) $   23,272     $   24,607     $   44,969     $   43,097    
                       
  Wood Processing Systems                
      Operating Income $   8,801     $   5,313     $   16,071     $   12,676    
      Acquired Backlog Amortization (e)     -          -          -          252    
      Adjusted Operating Income (a)     8,801         5,313         16,071         12,928    
      Depreciation and Amortization     2,375         2,536         4,762         5,080    
      Adjusted EBITDA (a) $   11,176     $   7,849     $   20,833     $   18,008    
                       
  Material Handling Systems                
      Operating Income (Loss) $   488     $   -      $   (865 )   $   -     
      Acquisition Costs     -          -          843         -     
      Acquired Backlog Amortization (e)     284         -          1,282         -     
      Acquired Profit in Inventory (f)     1,239         -          3,549         -     
      Adjusted Operating Income (a)     2,011         -          4,809         -     
      Depreciation and Amortization     2,241         -          3,707         -     
      Adjusted EBITDA (a) $   4,252     $   -      $   8,516     $   -     
                       
  Corporate and Other                
      Operating Loss $   (6,208 )   $   (6,477 )   $   (12,059 )   $   (11,760 )  
      Depreciation and Amortization     199         169         391         336    
      EBITDA (a) $   (6,009 )   $   (6,308 )   $   (11,668 )   $   (11,424 )  
                       
                       
  (a)  Represents a non-GAAP financial measure.                
                       
  (b)  Represents the increase (decrease) resulting from the exclusion of an acquisition and from the conversion of  
      current period amounts reported in local currencies into U.S. dollars at the exchange rate of the prior period  
      compared to the U.S. dollar amount reported in the prior period.      
               
  (c)  Geographic revenues are attributed to regions based on customer location.      
             
  (d)  See reconciliation to the most directly comparable GAAP financial measure under "Adjusted Operating Income      
      and Adjusted EBITDA Reconciliation."                
                       
  (e)  Represents intangible amortization expense associated with acquired backlog.    
           
  (f)  Represents expense within cost of revenues associated with amortization of acquired profit in inventory.  
           
  (g)  Calculated as adjusted EBITDA divided by revenue in each period.      


About Kadant

Kadant Inc. is a global supplier of high-value, critical components and engineered systems used in process industries worldwide. The Company’s products, technologies, and services play an integral role in enhancing process efficiency, optimizing energy utilization, and maximizing productivity in resource-intensive industries. Kadant is based in Westford, Massachusetts, with approximately 2,800 employees in 20 countries worldwide. For more information, visit www.kadant.com.

Safe Harbor Statement
The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that involve a number of risks and uncertainties, including forward-looking statements about our future financial and operating performance, demand for our products, and economic and industry outlook. These forward-looking statements represent our expectations as of the date of this press release. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results to differ materially from these forward-looking statements as a result of various important factors, including those set forth under the heading "Risk Factors" in Kadant’s annual report on Form 10-K for the year ended December 29, 2018 and subsequent filings with the Securities and Exchange Commission. These include risks and uncertainties relating to adverse changes in global and local economic conditions; the variability and difficulty in accurately predicting revenues from large capital equipment and systems projects; our customers’ ability to obtain financing for capital equipment projects; international sales and operations; the variability and uncertainties in sales of capital equipment in China; the oriented strand board market and levels of residential construction activity; development and use of digital media; currency fluctuations; cyclical economic conditions affecting the global mining industry and the continued demand for coal; price increases or shortages of raw materials; dependence on certain suppliers; our acquisition strategy; failure of our information systems or breaches of data security and cybertheft; changes in government regulations and policies and compliance with laws; our internal growth strategy; competition; soundness of suppliers and customers; changes in our tax provision or exposure to additional tax liabilities; our ability to successfully manage our manufacturing operations; disruption in production; future restructurings; economic conditions and regulatory changes caused by the United Kingdom’s exit from the European Union; our debt obligations; restrictions in our credit agreement and note purchase agreement; loss of key personnel and effective succession planning; protection of intellectual property; fluctuations in our share price; soundness of financial institutions; environmental laws and regulations; climate change; environmental, health and safety laws and regulations; adequacy of our insurance coverage; anti-takeover provisions; and reliance on third-party research.

Contacts
Investor Contact Information:
Michael McKenney, 978-776-2000
mike.mckenney@kadant.com 
or
Media Contact Information:
Wes Martz, 269-278-1715
wes.martz@kadant.com 

Kadant_Logo_BLK.jpg

Source: Kadant Inc