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kaiform8k2262013.htm

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): February 26, 2013


KADANT INC.
(Exact Name of Registrant as Specified in its Charter)



Delaware
1-11406
52-1762325
(State or Other Jurisdiction
(Commission File Number)
(IRS Employer
of Incorporation)
  
Identification No.)

One Technology Park Drive
    
Westford, Massachusetts
  
01886
(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:

 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 
 
KADANT INC.

 
Item 2.02  Results of Operations and Financial Condition.

On February 26, 2013, Kadant Inc. (the “Company”) announced its financial results for the fiscal quarter and year ended December 29, 2012. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99 to this Current Report on Form 8-K.

The information in this Form 8-K (including Exhibit 99) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

 
Item 9.01  Financial Statements and Exhibits.

 
(c) Exhibit
 
  
 
The following exhibit relating to Item 2.02 shall be deemed to be furnished and not filed.
     
 
Exhibit
    No.           
 
Description of Exhibit
     
 
    99
Press Release issued by the Company on February 26, 2013
     



 
2
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:  February 26, 2013
                 By
/s/ Thomas M. O’Brien 
   
Thomas M. O’Brien
Executive Vice President and
   Chief Financial Officer

3

kaiform8kexhibit992262013.htm
 
 
Exhibit 99

 
[LOGO]
NEWS
KADANT
AN ACCENT ON INNOVATION
One Technology Park Drive
Westford, MA 01886
 
 
Investor contact: Thomas M. O’Brien, 978-776-2000
Media contact: Wes Martz, 269-278-1715

Kadant Reports 2012 Fourth Quarter and Full-Year Results
Achieves Record Adjusted EPS for 2012
Provides Financial Guidance for 2013

WESTFORD, Mass., February 26, 2013 – Kadant Inc. (NYSE:KAI) reported its financial results for the fourth quarter and year ended December 29, 2012.

Fourth Quarter and Full-Year 2012 Financial Highlights
·  
GAAP diluted earnings per share (EPS) from continuing operations was $0.84 in the fourth quarter of 2012 compared to $0.90 in the fourth quarter of 2011. For the full year, GAAP diluted EPS was $2.66 compared to $2.74 in 2011.
 
·  
Adjusted diluted EPS was $0.44 in the fourth quarter of 2012 and a record $2.29 for the year.
 
·  
Revenues were $78 million in the fourth quarter of 2012 compared to record revenues of $97 million in the fourth quarter of 2011.
 
·  
Bookings were $76 million in the fourth quarter of 2012, increasing 10% sequentially and decreasing 3% compared to the fourth quarter of 2011.
 
·  
Gross margins were a record 43.9% for 2012 compared to 43.3% in 2011.
 
·  
Net income was $31.8 million and adjusted EBITDA was a record $44.8 million in 2012.
 
·  
Net cash was $48 million at the end of 2012, the highest level in over seven years.
 
·  
Cash flows from continuing operations were $30 million in 2012 compared to $34 million in 2011.
 
·  
Repurchases of common stock were $5 million in the quarter. For full-year 2012, repurchases were $14 million, which equates to 47% of net income from continuing operations.

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

Management Commentary

“We had an outstanding performance in 2012, achieving records in a number of categories,” said Jonathan W. Painter, president and chief executive officer of Kadant. “Adjusted diluted EPS for full-year 2012 increased 9 percent to a record $2.29, making 2012 and 2011 the two best years for EPS in our history. Adjusted diluted EPS of $0.44 in the fourth quarter of 2012 was down 25 percent compared to the same period last year, but well ahead of our GAAP guidance of $0.35 to $0.37.

“Revenues in the fourth quarter were $78 million, down 20 percent from last year’s record-setting performance largely due to lower capital revenues, particularly in our stock-preparation product line. Encouragingly, revenues for our parts and consumables were up 7 percent compared to the fourth quarter of last year and up 14 percent sequentially.

“We had another good quarter in operating cash flows. Cash flows from continuing operations were $13 million in the fourth quarter of 2012, down 14 percent compared to a very strong fourth quarter of 2011. For the full year, cash flows were $30 million and we ended the year with $55 million in cash. Our net cash position, that is, cash less debt, was $48 million, up $6 million from the third quarter of 2012. For full-year 2012, we purchased $14 million in common stock, which represented approximately 634,000 shares at an average purchase price of $22.87 per share.”

Fourth Quarter 2012

Kadant reported revenues from continuing operations of $78.1 million in the fourth quarter of 2012, a decrease of $18.9 million, or 20 percent, compared to $97.0 million in the fourth quarter of 2011. Revenues for the fourth quarter of 2012 included a $0.5 million decrease from foreign currency translation compared to the fourth quarter of 2011. Operating income from continuing operations was $6.7 million in the fourth quarter of 2012 compared to $9.1 million in the fourth quarter of 2011.

Net income from continuing operations was $9.6 million in the fourth quarter of 2012, or $0.84 per diluted share, compared to $10.7 million, or $0.90 per diluted share, in the fourth quarter of 2011. Net income from continuing operations in the fourth quarter of 2012 included a $4.6 million, or $0.40 per diluted share, benefit from discrete tax items. Net income from continuing operations in the fourth quarter of 2011 included a $4.1 million, or $0.34 per diluted share, benefit from discrete tax items and a $0.4 million, or $0.03 per diluted share, after-tax restructuring charge. Adjusted net income, a non-GAAP measure, was $5.0 million, or $0.44 per diluted share, in the fourth quarter of 2012 compared to $7.0 million, or $0.59 per diluted share, in the fourth quarter of 2011.

 
Adjusted Net Income and Adjusted Diluted EPS Reconciliation (non-GAAP)
Three Months Ended
Dec. 29, 2012
Three Months Ended
Dec. 31, 2011
($ in millions)
Diluted EPS
($ in millions)
Diluted EPS
Net Income and Diluted EPS Attributable to Kadant, as reported
         $       9.6
   $     0.83
  $      11.8
  $    1.00
   Loss (income) from discontinued operation
                     -
          0.01
           (1.1)
       (0.10)
Income and Diluted EPS from Continuing Operations, as reported
                  9.6
          0.84
          10.7
        0.90
Adjustments for the following:
        
   Restructuring costs
                     -
                -
           0.4
        0.03
   Benefit from discrete tax items
                 (4.6)
         (0.40)
          (4.1)
       (0.34)
Adjusted Net Income and Adjusted Diluted EPS
        $        5.0
   $     0.44
   $      7.0
  $    0.59

Full-Year 2012

For full-year 2012, Kadant reported revenues from continuing operations of $331.8 million, a decrease of $3.7 million, or 1 percent, compared with $335.5 million in 2011. Revenues for 2012 included an $8.4 million, or 2 percent, decrease from foreign currency translation. Operating income from continuing operations was $36.4 million in 2012, including $0.3 million in expense associated with a facility consolidation, compared to $38.7 million in 2011, including a $1.9 million gain, net of restructuring costs. Adjusted operating income, a non-GAAP measure, was $36.4 million in 2012 compared to $36.8 million in 2011.

Net income from continuing operations was $30.9 million in 2012, or $2.66 per diluted share, compared to $33.6 million, or $2.74 per diluted share, in 2011. Net income from continuing operations in 2012 included a $4.6 million, or $0.40 per diluted share, benefit from discrete tax items and a $0.3 million, or $0.03 per diluted share, after-tax expense associated with a facility consolidation. Net income from continuing operations in 2011 included a $6.2 million, or $0.51 per diluted share, benefit from discrete tax items and a $1.7 million, or $0.13 per diluted share, after-tax gain, net of restructuring costs. Adjusted net income, a non-GAAP measure, was a record $26.6 million, or $2.29 per diluted share, in 2012 compared to $25.7 million, or $2.10 per diluted share, in 2011.
 
 
 
 
 
Adjusted Net Income and Adjusted Diluted EPS Reconciliation (non-GAAP)
Twelve Months Ended
Dec. 29, 2012
Twelve Months Ended
Dec. 31, 2011
($ in millions)
Diluted EPS
($ in millions)
Diluted EPS
Net Income and Diluted EPS Attributable to Kadant, as reported
              $     31.6
   $     2.73
  $      33.6
  $    2.74
   (Income) loss from discontinued operation
                      (0.7)
         (0.07)
                -
              -
Income and Diluted EPS from Continuing Operations, as reported
                     30.9
          2.66
          33.6
        2.74
Adjustments for the following:
        
   Restructuring costs and other expense (income), net
                       0.3
          0.03
           (1.7)
       (0.13)
   Benefit from discrete tax items
                     (4.6)
         (0.40)
           (6.2)
       (0.51)
Adjusted Net Income and Adjusted Diluted EPS
              $     26.6
   $     2.29
   $      25.7
  $    2.10

Guidance

“We are seeing increased project activity and we believe the demand for our capital products will be stronger in 2013 compared to 2012, particularly in our stock-preparation product line,” Jonathan W. Painter continued. “Since the end of the year, we have booked more than $12 million in capital orders in our stock-preparation product line and we believe that consolidated bookings will increase sequentially in the first quarter of 2013. That said, the continuation of the relatively weak global economy combined with our booking rates over the last several quarters leads us to remain somewhat cautious as we look ahead to 2013. As a result, we expect to achieve GAAP diluted EPS from continuing operations of $1.80 to $1.90 in 2013 on revenues of $320 to $330 million. Our full-year diluted EPS guidance includes an unfavorable effect of $0.21 from a higher recurring tax rate compared to 2012. For the first quarter of 2013, we expect to achieve GAAP diluted EPS from continuing operations of $0.32 to $0.34 on revenues of $71 to $73 million.”

Conference Call

Kadant will hold a webcast with a slide presentation for investors on Wednesday, February 27, 2013, at 11 a.m. eastern time to discuss its fourth quarter and full-year performance, as well as future expectations. To access the webcast, including the slideshow and accompanying audio, go to www.kadant.com and click on the “Investors” tab. To listen to the webcast via teleconference, call 866-804-6926 within the U.S., or +1-857-350-1672 outside the U.S. and reference participant passcode 83375884. 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 Web site until March 29, 2013.

Shortly after the webcast, Kadant will post its updated general investor presentation incorporating the fourth quarter and full-year results on its Web site at www.kadant.com under the “Investors” tab.

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 revenues excluding the effect of foreign currency translation, adjusted operating income, adjusted net income, adjusted diluted EPS, earnings before interest, taxes, depreciation, and amortization (EBITDA), and adjusted EBITDA.

We believe that 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 to 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 additional measures 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.

We present increases or decreases in revenues excluding the effect of foreign currency translation to provide investors insight into underlying revenue trends.

Adjusted operating income and adjusted EBITDA exclude pre-tax restructuring costs of $0.4 million in the three-month period ended December 31, 2011. Adjusted operating income and adjusted EBITDA exclude pre-tax gains of $2.3 million, net of restructuring costs of $0.4 million in the twelve-month period ended December 31, 2011. These items are excluded as they are not indicative of our core operating results and not comparable to other periods, which have differing levels of incremental costs or other income or none at all.

Adjusted diluted EPS in the three-month and twelve-month periods ended December 29, 2012 and December 31, 2011 was calculated using the reported weighted average diluted shares for each period.

Adjusted net income and adjusted diluted EPS exclude:

·  
Other expense of $0.3 million in the twelve-month period ended December 29, 2012 associated with accelerated depreciation related to a facility consolidation; and restructuring costs of $0.4 million in the fourth quarter of 2011 and other income, net, of $1.7 million in the twelve-month period ended December 31, 2011. Other income, net, includes gains on the sale of assets of $2.0 million (net of tax of $0.3 million) and restructuring costs of $0.3 million (net of tax of $0.1 million) in the twelve-month period ended December 31, 2011. We believe that the restructuring costs and other income and expense are not indicative of our core operating results and not comparable to other periods, which have differing levels of incremental costs and income or none at all.

·  
A benefit from discrete tax items of $4.6 million in the three-month and twelve-month periods ended December 29, 2012 and $4.1 million and $6.2 million in the three-month and twelve-month periods ended December 31, 2011, respectively. The benefit from discrete tax items in the 2012 periods were primarily due to the reversal of valuation allowances on certain deferred tax assets in the U.S. based on a consideration of expected profitability and foreign source income in future periods. The benefit from discrete tax items in the 2011 periods were primarily due to the reversal of valuation allowances on certain deferred tax assets in the U.S. and China based on a consideration of expected profitability in future periods. We believe that these discrete tax benefits are not comparable to other periods, which may have differing levels of discrete tax items or none at all.

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


-more-

 
 
 
 
Financial Highlights (unaudited)
                
 
(In thousands, except per share amounts and percentages)
              
                       
       
Three Months Ended
  
Twelve Months Ended
  
 
Consolidated Statement of Income
Dec. 29, 2012
Dec. 31, 2011
Dec. 29, 2012
Dec. 31, 2011
                       
 
Revenues
 $      78,055
  
 $      96,965
  
 $    331,751
  
 $    335,460
  
                       
 
Costs and Operating Expenses:
                
   
Cost of revenues
         44,519
  
         59,562
  
       185,949
  
       190,247
  
   
Selling, general, and administrative expenses
         25,297
  
         26,286
  
       103,101
  
       102,660
  
   
Research and development expenses
            1,514
  
            1,594
  
            5,950
  
            5,717
  
   
Restructuring costs and other expense (income), net (a)
                   -
  
               408
  
               307
  
          (1,874)
  
 
 
    
         71,330
  
         87,850
  
       295,307
  
       296,750
  
                       
 
Operating Income
            6,725
  
            9,115
  
         36,444
  
         38,710
  
 
Interest Income
                 88
  
               156
  
               319
  
               499
  
 
Interest Expense
             (209)
  
             (256)
  
             (833)
  
          (1,066)
  
                       
 
Income from Continuing Operations before Income Taxes
            6,604
  
            9,015
  
         35,930
  
         38,143
  
                       
 
Income Tax (Benefit) Provision
          (3,046)
  
          (1,689)
  
            4,852
  
            4,285
  
 
 
                    
 
Income from Continuing Operations
            9,650
  
         10,704
  
         31,078
  
         33,858
  
                       
 
(Loss) Income from Discontinued Operation, Net of Tax
                (37)
  
            1,156
  
               743
  
                  (9)
  
                       
 
Net Income
            9,613
  
         11,860
  
         31,821
  
         33,849
  
                       
 
Net Income Attributable to Noncontrolling Interest
                (47)
  
                (28)
  
             (198)
  
             (274)
  
                       
 
Net Income Attributable to Kadant
 $        9,566
  
 $      11,832
  
 $      31,623
  
 $      33,575
  
                       
 
Amounts Attributable to Kadant:
                
     
Income from Continuing Operations
 $        9,603
  
 $      10,676
  
 $      30,880
  
 $      33,584
  
   
 
(Loss) Income from Discontinued Operation, Net of Tax
                (37)
  
            1,156
  
               743
  
                  (9)
  
   
 
Net Income Attributable to Kadant
 $        9,566
  
 $      11,832
  
 $      31,623
  
 $      33,575
  
                       
 
Earnings per Share from Continuing Operations
                
   
Attributable to Kadant:
                
     
Basic
 $           0.85
  
 $           0.91
  
 $           2.70
  
 $           2.77
  
     
Diluted
 $           0.84
  
 $           0.90
  
 $           2.66
  
 $           2.74
  
                       
 
Earnings per Share Attributable to Kadant:
                
     
Basic
 $           0.85
  
 $           1.01
  
 $           2.76
  
 $           2.77
  
     
Diluted
 $           0.83
  
 $           1.00
  
 $           2.73
  
 $           2.74
  
                       
 
Weighted Average Shares:
                
     
Basic
         11,258
  
         11,751
  
         11,456
  
         12,124
  
                       
     
Diluted
         11,460
  
         11,884
  
         11,590
  
         12,261
  
                       
                   
 Increase
  
                   
            (Decrease)
                   
        Excluding Effect
       
Three Months Ended
  
Increase
  
   of Currency
  
 
Revenues by Product Line
Dec. 29, 2012
Dec. 31, 2011
(Decrease)
  
       Translation (c,d)
                       
 
Stock-Preparation
 $      28,069
  
 $      43,240
  
 $    (15,171)
  
 $    (14,908)
  
 
Doctoring, Cleaning, and Filtration (b)
         24,787
  
         23,383
  
            1,404
  
            1,233
  
 
Fluid-Handling
         22,848
  
         28,204
  
          (5,356)
  
          (4,963)
  
                       
   
Papermaking Systems Segment
         75,704
  
         94,827
  
        (19,123)
  
        (18,638)
  
 
Fiber-based Products
            2,351
  
            2,138
  
               213
  
               213
  
                       
       
 $      78,055
  
 $      96,965
  
 $    (18,910)
  
 $    (18,425)
  
                       
               
 
  
 Increase
  
                   
            (Decrease)
                   
        Excluding Effect
       
Three Months Ended
  
Increase
  
of Currency
  
 
Sequential Revenues by Product Line
Dec. 29, 2012
Sept. 29, 2012
(Decrease)
  
       Translation (c,d)
                       
 
Stock-Preparation
 $      28,069
  
 $      34,492
  
 $       (6,423)
  
 $       (6,778)
  
 
Doctoring, Cleaning, and Filtration (b)
         24,787
  
         27,095
  
          (2,308)
  
          (2,601)
  
 
Fluid-Handling
         22,848
  
         23,624
  
             (776)
  
             (996)
  
                       
   
Papermaking Systems Segment
         75,704
  
         85,211
  
          (9,507)
  
        (10,375)
  
 
Fiber-based Products
            2,351
  
            1,390
  
               961
  
               961
  
                       
       
 $      78,055
  
 $      86,601
  
 $       (8,546)
  
 $       (9,414)
  
                       
-more-

 
 
 

               
 
  
 Increase
  
                   
           (Decrease)
                   
       Excluding Effect
       
Twelve Months Ended
  
Increase
  
of Currency
  
 
Revenues by Product Line
Dec. 29, 2012
Dec. 31, 2011
(Decrease)
  
        Translation (c,d)
                       
 
Stock-Preparation
 $    123,952
  
 $    131,914
  
 $       (7,962)
  
 $       (5,580)
  
 
Doctoring, Cleaning, and Filtration (b)
       104,493
  
         92,333
  
         12,160
  
         14,699
  
 
Fluid-Handling
         92,581
  
       100,618
  
          (8,037)
  
          (4,548)
  
                       
   
Papermaking Systems Segment
       321,026
  
       324,865
  
          (3,839)
  
            4,571
  
 
Fiber-based Products
         10,725
  
         10,595
  
               130
  
               130
  
                       
       
 $    331,751
  
 $    335,460
  
 $       (3,709)
  
 $        4,701
  
                       
                   
 Increase
  
                   
           (Decrease)
                   
       Excluding Effect
       
Three Months Ended
  
Increase
  
of Currency
  
 
Revenues by Geography (e)
Dec. 29, 2012
Dec. 31, 2011
(Decrease)
  
       Translation (c,d)
                       
 
North America
 $      37,287
  
 $      39,422
  
 $       (2,135)
  
 $       (2,343)
  
 
Europe
         15,978
  
         28,975
  
        (12,997)
  
        (12,612)
  
 
China
         12,521
  
         18,835
  
          (6,314)
  
          (6,415)
  
 
South America
            8,987
  
            4,901
  
            4,086
  
            4,610
  
 
Other
            3,282
  
            4,832
  
          (1,550)
  
          (1,665)
  
                       
 
 
 
  
 $      78,055
  
 $      96,965
  
 $    (18,910)
  
 $    (18,425)
  
                       
                   
 Increase
  
                   
          (Decrease)
                   
      Excluding Effect
       
Three Months Ended
  
Increase
  
of Currency
  
 
Sequential Revenues by Geography (e)
Dec. 29, 2012
Sept. 29, 2012
(Decrease)
  
      Translation (c,d)
                       
 
North America
 $      37,287
  
 $      35,248
  
 $        2,039
  
 $        1,947
  
 
Europe
         15,978
  
         18,113
  
          (2,135)
  
          (2,630)
  
 
China
         12,521
  
         17,677
  
          (5,156)
  
          (5,248)
  
 
South America
            8,987
  
            5,873
  
            3,114
  
            2,927
  
 
Other
            3,282
  
            9,690
  
          (6,408)
  
          (6,410)
  
                       
 
 
 
  
 $      78,055
  
 $      86,601
  
 $       (8,546)
  
 $       (9,414)
  
                       
                   
 Increase
  
                   
           (Decrease)
                   
       Excluding Effect
       
Twelve Months Ended
  
Increase
  
of Currency
  
 
Revenues by Geography (e)
Dec. 29, 2012
Dec. 31, 2011
(Decrease)
  
      Translation (c,d)
                       
 
North America
 $    152,964
  
 $    146,564
  
 $        6,400
  
 $        7,149
  
 
Europe
         71,992
  
         84,883
  
        (12,891)
  
          (8,576)
  
 
China
         53,242
  
         62,615
  
          (9,373)
  
        (10,033)
  
 
South America
         26,368
  
         18,205
  
            8,163
  
         10,708
  
 
Other
         27,185
  
         23,193
  
            3,992
  
            5,453
  
                       
 
 
 
  
 $    331,751
  
 $    335,460
  
 $       (3,709)
  
 $        4,701
  
                       
       
Three Months Ended
  
Twelve Months Ended
  
 
Business Segment Information
Dec. 29, 2012
Dec. 31, 2011
Dec. 29, 2012
Dec. 31, 2011
                       
 
Gross Profit Margin:
                
     
Papermaking Systems
42.8%
  
38.3%
  
43.7%
  
43.1%
  
     
Fiber-based Products
48.0%
  
49.9%
  
50.1%
  
50.2%
  
       
43.0%
  
38.6%
  
43.9%
  
43.3%
  
                       
 
Operating Income:
                
     
Papermaking Systems
 $      10,357
  
 $      12,526
  
 $      48,618
  
 $      50,869
  
     
Corporate and Fiber-based Products
          (3,632)
  
          (3,411)
  
        (12,174)
  
        (12,159)
  
       
 $        6,725
  
 $        9,115
  
 $      36,444
  
 $      38,710
  
                       
 
Adjusted Operating Income (d,f):
                
     
Papermaking Systems
 $      10,357
  
 $      12,934
  
 $      48,618
  
 $      48,995
  
     
Corporate and Fiber-based Products
          (3,632)
  
          (3,411)
  
        (12,174)
  
        (12,159)
  
       
 $        6,725
  
 $        9,523
  
 $      36,444
  
 $      36,836
  
                       
 
Bookings from Continuing Operations:
                
     
Papermaking Systems
 $      73,445
  
 $      75,181
  
 $    290,687
  
 $    334,978
  
     
Fiber-based Products
            2,562
  
            3,487
  
            9,668
  
         10,599
  
       
 $      76,007
  
 $      78,668
  
 $    300,355
  
 $    345,577
  
                       
 
Capital Expenditures from Continuing Operations:
                
     
Papermaking Systems
 $        2,643
  
 $        2,470
  
 $        3,982
  
 $        7,751
  
     
Corporate and Fiber-based Products
                 93
  
                 87
  
               268
  
               279
  
       
 $        2,736
  
 $        2,557
  
 $        4,250
  
 $        8,030
  
                       
-more-
 
 
 

       
Three Months Ended
  
Twelve Months Ended
  
 
Cash Flow and Other Data from Continuing Operations
Dec. 29, 2012
Dec. 31, 2011
Dec. 29, 2012
Dec. 31, 2011
                       
 
Cash Provided by Operations
 $      12,719
  
 $      14,863
  
 $      30,456
  
 $      34,362
  
 
Depreciation and Amortization Expense
            1,965
  
            1,989
  
            8,384
  
            7,936
  
                       
 
Adjusted Operating Income and Adjusted EBITDA
Three Months Ended
  
Twelve Months Ended
  
 
Reconciliation
Dec. 29, 2012
Dec. 31, 2011
Dec. 29, 2012
Dec. 31, 2011
                       
 
Consolidated
                
     
Net Income Attributable to Kadant
 $        9,566
  
 $      11,832
  
 $      31,623
  
 $      33,575
  
     
Net Income Attributable to Noncontrolling Interest
                 47
  
                 28
  
               198
  
               274
  
     
Loss (Income) from Discontinued Operation, Net of Tax
                 37
  
          (1,156)
  
             (743)
  
                    9
  
     
Income Tax (Benefit) Provision
          (3,046)
  
          (1,689)
  
            4,852
  
            4,285
  
     
Interest Expense, net
               121
  
               100
  
               514
  
               567
  
     
Operating Income
            6,725
  
            9,115
  
         36,444
  
         38,710
  
     
Restructuring costs and other income, net
                   -
  
               408
  
                   -
  
          (1,874)
  
     
Adjusted Operating Income (d)
            6,725
  
            9,523
  
         36,444
  
         36,836
  
     
Depreciation and Amortization
            1,965
  
            1,989
  
            8,384
  
            7,936
  
     
Adjusted EBITDA (d)
 $        8,690
  
 $      11,512
  
 $      44,828
  
 $      44,772
  
                       
 
Papermaking Systems
                
 
 
  
Operating Income
 $      10,357
  
 $      12,526
  
 $      48,618
  
 $      50,869
  
     
Restructuring costs and other income, net
                   -
  
               408
  
                   -
  
          (1,874)
  
     
Adjusted Operating Income (d)
         10,357
  
         12,934
  
         48,618
  
         48,995
  
 
 
  
Depreciation and Amortization
            1,840
  
            1,866
  
            7,903
  
            7,455
  
 
 
  
Adjusted EBITDA (d)
 $      12,197
  
 $      14,800
  
 $      56,521
  
 $      56,450
  
                       
 
Corporate and Fiber-based Products
                
     
Operating Loss
 $       (3,632)
  
 $       (3,411)
  
 $    (12,174)
  
 $    (12,159)
  
     
Depreciation and Amortization
               125
  
               123
  
               481
  
               481
  
     
EBITDA (d)
 $       (3,507)
  
 $       (3,288)
  
 $    (11,693)
  
 $    (11,678)
  
                       
                   
 
  
 
(a)
Represents restructuring costs of $408 in the three-month period ended December 31, 2011. Represents accelerated
     
depreciation of $307 in the twelve-month period ended December 29, 2012 associated with the anticipated disposal of
     
equipment in China related to a facility consolidation. Represents a gain from the sale of assets of $2,282, offset by
     
restructuring costs of $408 in the twelve-month period ended December 31, 2011.
      
                       
 
(b)
New product line presentation beginning in the third quarter of 2012. This product line was formerly presented separately
     
as doctoring, water-management, and other product lines. Prior period amounts have been recast to conform to the
     
current presentation.
                
                       
 
(c)
Represents the increase (decrease) resulting 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.
                       
 
(d)
Represents a non-GAAP financial measure.
                
                       
 
(e)
Geographic revenues are attributed to regions based on customer location. Prior period amounts have been recast to
     
conform to the current presentation.
                
                       
 
(f)
See reconciliation to the most directly comparable GAAP financial measure under "Adjusted Operating Income and
     
Adjusted EBITDA Reconciliation."
                
                       
-more-

 
 
 

About Kadant

Kadant Inc. is a leading supplier to the global pulp and paper industry. Our stock-preparation; fluid-handling; and doctoring, cleaning, and filtration products are designed to increase efficiency and improve quality in pulp and paper production. Many of our products, particularly in our fluid-handling product line, are also used to optimize production in other process industries. In addition, we produce granules from papermaking byproducts for agricultural and lawn and garden applications. Kadant is based in Westford, Massachusetts, with revenues of $332 million in 2012 and 1,600 employees in 17 countries worldwide. For more information, 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 about our expected future financial and operating performance, demand for our products, and economic and industry outlook. Our actual results may 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 quarterly report on Form 10-Q for the period ended September 29, 2012. These include risks and uncertainties relating to our dependence on the pulp and paper industry; significance of sales and operation of manufacturing facilities in China; commodity and component price increases or shortages; international sales and operations; competition; soundness of suppliers and customers; our effective tax rate; future restructurings; soundness of financial institutions; our debt obligations; restrictions in our credit agreement; our acquisition strategy; protection of patents and proprietary rights; failure of our information systems or breaches of data security; fluctuations in our share price; 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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