UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------------------------------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 22, 2004
KADANT INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 1-11406 52-1762325
(State or Other (Commission File Number) (IRS Employer
Jurisdiction Identification No.)
of Incorporation)
One Acton Place
Acton, Massachusetts 01720
(Address of Principal Executive Offices) (Zip Code)
(978) 776-2000
Registrant's telephone number, including area code
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
KADANT INC.
Item 2.05 Costs Associated with Exit or Disposal Activities.
On November 22, 2004, Kadant Inc. (the "Company") issued a press
release announcing approval on November 18, 2004, of a proposed restructuring of
the Company's Kadant Lamort subsidiary, based in Vitry-le-Francois, France. This
restructuring was initiated to strengthen Kadant Lamort's competitive position
in the European paper industry. Under French law, the proposed restructuring
requires consultation with Kadant Lamort's workers' council, which consists of
employees and trade union representatives, before implementation. The
restructuring primarily includes the reduction of 136 full-time positions in
France, and is expected to be implemented over the next six months. The Company
estimates that it will accrue a restructuring charge for severance and
associated costs of the workforce reduction of between $6 million and $10
million in the fourth quarter of 2004 and that these costs will result in cash
expenditures within the next twelve months. The Company is also evaluating the
effects of this restructuring on the retirement plan at Kadant Lamort and will
record an adjustment to the associated liability, if any, consistent with
accounting principles generally accepted in the United States.
The foregoing summary description of the content of the press release
is qualified in its entirety by reference to the press release, the full text of
which is attached as an exhibit to this Form 8-K.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS: Except for historical
information, the matters discussed in this filing on Form 8-K are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Forward-looking statements, including
without limitation the Company's intentions, beliefs, expectations and
predictions, involve risks and uncertainties which may cause actual results to
differ materially from those discussed herein. These include forward-looking
statements regarding the potential improvement or recovery of the paper
industry; our projected operations; the future performance of our businesses;
the estimated size, cost, and timing of the implementation of the restructuring;
estimated annualized savings from the restructuring; and future profitability
and competitiveness of the French operation. These risks and uncertainties are
detailed by the Company in its filings with the Unites States Securities and
Exchange Commission ("SEC"), including without limitation its most recent filing
on Form 10-Q for the period ended October 2, 2004. These include risks and
uncertainties relating to our dependence on the pulp and paper industry;
international sales and operations; competition; ability to manufacture and
distribute composite building products, and the seasonality in sales and the
long-term performance of such products; availability of raw materials and
exposure to commodity price fluctuations related to the manufacture of composite
and fiber-based products; acquisition strategy; protection of patents and
proprietary rights; fluctuations in quarterly operating results; and
anti-takeover provisions. You are strongly urged to review all such filings for
more detailed discussion of such risks and uncertainties. The Company's SEC
filings are readily obtainable at no charge at www.sec.gov.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
No. Description
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99.1 Press Release dated November 22, 2004
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KADANT INC.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KADANT INC.
Date: November 22, 2004 By: /s/ Thomas M. O'Brien
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Thomas M. O'Brien
Executive Vice President, Chief Financial Officer,
and Treasurer
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Exhibit 99.1
[LOGO]
NEWS
KADANT
AN ACCENT ON INNOVATION
One Acton Place, Suite 202
Acton, MA 01720
Investor contact: Thomas M. O'Brien, 978-776-2000
Media contact: GreatPoint Communications, 978-392-6866
Kadant Approves Restructuring of its French Subsidiary
ACTON, Mass., November 22, 2004 - Kadant Inc. (NYSE:KAI) has approved a proposed
restructuring of its Kadant Lamort subsidiary, based in Vitry-le-Francois,
France, intended to strengthen the operation's competitive position in the
European paper industry. Under French law, the proposal requires consultation
with Kadant Lamort's workers' council, which consists of employees and trade
union representatives, before implementation.
The restructuring would involve the reduction of 136 full-time
positions in France over the next six months. Kadant Lamort currently employs
approximately 320 people throughout Europe. Kadant would accrue an estimated
restructuring charge of $6 million to $10 million in the fourth quarter of 2004
for severance and associated costs related to the proposed workforce reduction.
When fully implemented, the company expects to yield annualized savings from the
restructuring of approximately $5 million to $7 million.
"The weak market environment in Europe over the past few years has
affected our ability to compete effectively," said Alain Serres, president of
Kadant Lamort. "These decisions will be very difficult, but essential to allow
Kadant Lamort to maintain its position as a leading supplier to the European
pulp and paper industry. Our goal is to preserve as many positions as possible
for the long term by improving the overall health of the business."
William A. Rainville, chairman and chief executive officer of Kadant,
said, "Kadant Lamort has been, and we expect will continue to be, our European
base for supplying a range of products to the paper industry. Since we acquired
the business in 1990, we have made substantial investments in facility
improvements and technology advancement, including our only global R&D center
for stock-preparation systems.
"Other operations within Kadant have benefited in the past from
reorganizations in response to market conditions. I am confident that the
restructuring will enable Kadant Lamort to attain levels of profitability and
competitiveness in line with Kadant operations elsewhere in the world. Alain and
his team have our full support during this difficult process, and we believe
that the proposed actions will allow a stronger, healthier Kadant Lamort to
emerge as market conditions begin to improve."
Kadant Lamort provides a range of products and services to the global
pulp and paper industry, primarily in the European marketplace. Its products
include stock-preparation systems used for the production of virgin and recycled
packaging, printing, tissue, and special grades. The business also supplies
paper machine doctoring equipment and other papermaking accessories, as well as
water filtration, formation, and cleaning and conditioning systems.
Kadant Inc. is a leading supplier of a range of products for the global
papermaking and paper recycling industries, including stock-preparation
equipment, water-management systems, and paper machine accessories. We also
develop and manufacture composite building materials produced from recycled
fiber and plastic. Kadant, based in Acton, Massachusetts, had approximately $204
million in revenues in 2003 and 1,000 employees worldwide. For more information,
please visit www.kadant.com.
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 regarding the potential improvement or
recovery of the paper industry; our projected operations; the future performance
of our businesses; the estimated size, cost, and timing of the implementation of
the restructuring; estimated annualized savings from the restructuring; and
future profitability and competitiveness of the French operation. Important
factors that could cause actual results to differ materially from those
indicated by such statements are set forth under the heading "Risk Factors" in
Kadant's quarterly report on Form 10-Q for the period ended October 2, 2004.
These include risks and uncertainties relating to our dependence on the pulp and
paper industry; international sales and operations; competition; ability to
manufacture and distribute composite building products, and the seasonality in
sales and the long-term performance of such products; availability of raw
materials and exposure to commodity price fluctuations related to the
manufacture of composite and fiber-based products; acquisition strategy;
protection of patents and proprietary rights; fluctuations in quarterly
operating results; and anti-takeover provisions. We undertake no obligation to
publicly update any forward-looking statement, whether as a result of new
information, future events, or otherwise.
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