Kadant Inc · NYSE:KAI

Kadant — Shareholder Meeting (May 2012)

44 slides from Kadant's shareholder meeting presentation, May 23, 2012

  1. Slide 1: Annual Meeting of Stockholders May 23, 2012

    Annual Meeting of Stockholders May 23, 2012 Westford, Massachusetts © 2012 Kadant Inc. All rights reserved .

  2. Slide 2: William A. Rainville, Chairman of the Board

    * © 2012 Kadant Inc. All rights reserved . William A. Rainville Chairman of the Board

  3. Slide 3: Items of Business

    * © 2012 Kadant Inc. All rights reserved . ITEMS OF BUSINESS Sandra L. Lambert Vice President, General Counsel, and Secretary

  4. Slide 4: Safe Harbor

    * © 2012 Kadant Inc. All rights reserved. Safe Harbor The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This slide presentation contains forward-looking statements that involve a number of risks and uncertainties, including forward-lookin

  5. Slide 5: Items of Business

    * © 2012 Kadant Inc. All rights reserved . Items of Business PROPOSAL 1 • Elect two directors constituting the entire class of directors to be elected for a three-year term expiring in May 2015 – Mr. Francis L. McKone – Dr. William P. Tully

  6. Slide 6: Items of Business (cont.)

    * © 2012 Kadant Inc. All rights reserved . Items of Business (cont.) PROPOSAL 1 • Elect two directors constituting the entire class of directors to be elected for a three-year term expiring in May 2015 – Mr. Francis L. McKone – Dr. William P. Tully PROPOSAL 2 • Non-binding advisory vote on executive

  7. Slide 7: Items of Business (cont.)

    * © 2012 Kadant Inc. All rights reserved . Items of Business (cont.) PROPOSAL 3 • Re-approval of our annual cash incentive plan

  8. Slide 8: Items of Business (cont.)

    * © 2012 Kadant Inc. All rights reserved . Items of Business (cont.) PROPOSAL 3 • Re-approval of our annual cash incentive plan PROPOSAL 4 • Ratify the selection of Ernst & Young LLP as our independent registered public accounting firm for FY 2012

  9. Slide 9: Business Review

    * © 2012 Kadant Inc. All rights reserved . BUSINESS REVIEW Jonathan W. Painter President & CEO

  10. Slide 10: About Kadant

    * © 2012 Kadant Inc. All rights reserved . About Kadant $ 335 million in revenues (2011) 1,700 employees worldwide 14 manufacturing sites

  11. Slide 11: Revenues and Adjusted Diluted EPS

    * © 2012 Kadant Inc. All rights reserved . Revenues and Adjusted Diluted EPS

  12. Slide 12: Adjusted Diluted EPS Reconciliation

    2007 2008 2009 2010 2011 Diluted EPS, as reported $ 1.59 $ (1.67) $ (0.48) $ 1.48 $ 2.74 Loss from Discontinued Operation, net of tax $ 0.19 $ - $ - $ - $ - Diluted EPS from Continuing Operations $ 1.78 $ (1.67) $ (0.48) $ 1.48 $ 2.74 Loss on Sale of Subsidiary, net of tax $ 0.02 $ - $ - $ - $ - Goo

  13. Slide 13: Financial Summary FY 2011

    * © 2012 Kadant Inc. All rights reserved . (In millions, except per share amounts and %) FY 2011 FY 2010 % Change Revenues $ 335.5 $ 270.0 24% Gross Profit Margin 43.3% 43.9% SG&A, R&D expenses $ 108.4 $ 94.5 Restructuring costs and other income, net $ (1.9) $ (1.0) Operating Income $ 38.7 $ 24.9 55

  14. Slide 14: First Quarter 2012 Financial Summary

    * © 2012 Kadant Inc. All rights reserved . (In millions, except per share amounts and %) 1Q12 1Q11 % Change Revenues $ 84.1 $ 71.7 17% Gross Profit Margin 45.6% 47.6% Operating Expenses: SG&A, R&D expenses $ 27.7 $ 25.8 Restructuring costs and other expense, net $0.3 - Operating Income $ 10.4 $ 8.3

  15. Slide 15: First Quarter 2012 Balance Sheet

    * © 2012 Kadant Inc. All rights reserved . (In millions) 1Q12 1Q11 Cash, Cash Equivalents, and Restricted Cash $ 43.1 $ 57.7 Accounts Receivable, net 59.9 52.3 Inventories 51.9 51.5 Property, Plant, and Equipment, net 39.2 37.5 Intangible Assets 28.6 26.5 Goodwill 107.6 100.6 Other Assets 31.7 23.4

  16. Slide 16: Global Platform Serving Customers Worldwide

    * © 2012 Kadant Inc. All rights reserved . Global Platform Serving Customers Worldwide Major manufacturing site Manufacturing licensee

  17. Slide 17: 2011 Revenues by Geography and Product Line

    * © 2012 Kadant Inc. All rights reserved . 2011 Revenues by Geography and Product Line Geographic data is attributed to countries based on customer location.

  18. Slide 18: 2011 Revenues by Geography and Parts vs. Capital

    * © 2012 Kadant Inc. All rights reserved . 2011 Revenues by Geography and Parts vs. Capital Geographic data is attributed to countries based on customer location. ● Capital (45%) ● Parts & Consumables (55%)

  19. Slide 19: Percentage estimated by Company using 2011 revenue

    * © 2012 Kadant Inc. All rights reserved . Percentage estimated by Company using 2011 revenue Source: RISI World Pulp & Recovered Paper Forecast, 2011

  20. Slide 20: Product Review

    * © 2012 Kadant Inc. All rights reserved . PRODUCT REVIEW

  21. Slide 21: Stock Preparation

    39% * © 2012 Kadant Inc. All rights reserved . Stock Preparation • Pulpers • Screens • Cleaners • De-inking • Recycling systems • Heat transfer products Separation and cleaning products and systems to convert waste paper into clean pulp. % of 2011 Revenue 2011 Stock-Preparation Revenue Parts

  22. Slide 22: Water Management

    * © 2012 Kadant Inc. All rights reserved . 41% Water Management • Shower systems • Spray nozzles • Fabric and roll cleaning systems • Filters • Wear surfaces and Formation systems Products and systems for delivering, filtering, and recycling process water. FORMING & PRESSING % of 2011 Revenue 2011 W

  23. Slide 23: Doctoring

    17% * © 2012 Kadant Inc. All rights reserved . 78% Doctoring • Doctor blades • Blade holders • Doctoring systems Consumable products used to clean roll surfaces and remove contaminants. PRESSING & DRYING % of 2011 Revenue 2011 Doctoring Revenue Parts

  24. Slide 24: Fluid Handling

    30% * © 2012 Kadant Inc. All rights reserved . 66% Fluid Handling • Rotary joints • Syphon systems • Steam and condensate systems • Dryer systems control software Fluid handling products and systems used in process industries worldwide. DRYING % of 2011 Revenue Parts

  25. Slide 25: Technology & Innovation Centers

    * © 2012 Kadant Inc. All rights reserved . Technology & Innovation Centers STOCK PREPARATION Vitry, France FLUID HANDLING Michigan, USA WATER MANAGEMENT Husqvarna, Sweden DOCTORING Massachusetts, USA

  26. Slide 26: Industry Review

    * © 2012 Kadant Inc. All rights reserved . INDUSTRY REVIEW

  27. Slide 27: Pulp & Paper Industry Outlook

    * © 2012 Kadant Inc. All rights reserved . Pulp & Paper Industry Outlook DEVELOPED REGIONS • Containerboard and Tissue grades show modest growth • Demand growth for Printing & Writing papers is flat to negative • Projects are driven by ROI focused on input costs • Rebuild projects are primary contri

  28. Slide 28: World Demand for Paper & Paperboard

    * © 2012 Kadant Inc. All rights reserved . World Demand for Paper & Paperboard 2016F 383 million tons 459 million tons (projected) Source: RISI World Pulp & Recovered Paper Forecast, November 2011 Asia 36% Asia 48%

  29. Slide 29: Per Capita Consumption of Paper

    * © 2012 Kadant Inc. All rights reserved . Per Capita Consumption of Paper Source: RISI, Inc. World Production and Trade by Country (2011) Kilograms, 2010

  30. Slide 30: World Paper and Board Capacity: All Grades

    * © 2012 Kadant Inc. All rights reserved . World Paper and Board Capacity: All Grades Source: RISI World Pulp & Recovered Paper Forecast, November 2011 2010-16 CAGR = 2.6%

  31. Slide 31: World Paper and Board Capacity

    * © 2012 Kadant Inc. All rights reserved . World Paper and Board Capacity Less Newsprint and Printing & Writing Papers Source: RISI World Pulp & Recovered Paper Forecast, November 2011 2010-16 CAGR = 3.7%

  32. Slide 32: Production in Emerging Markets (Less China)

    * © 2012 Kadant Inc. All rights reserved . Production in Emerging Markets (Less China) Source: RISI World Forecast, March 2012. Emerging markets include Brazil, India, Indonesia, Malaysia, Mexico, Eastern Europe, Russia, Taiwan, Thailand, and Other Asia. 2010-16 CAGR = 5.0%

  33. Slide 33: Investing for Growth

    * © 2012 Kadant Inc. All rights reserved . INVESTING FOR GROWTH

  34. Slide 34: Our Strategy for Growth

    * © 2012 Kadant Inc. All rights reserved . Our Strategy for Growth 1. Focus on emerging markets 2. Increase spare parts and consumables revenue 3. Leverage low cost manufacturing 4. Continue to develop innovative products 5. Seek opportunities outside paper industry 6. Pursue acquisitions that compl

  35. Slide 35: Investing in Operational Efficiencies

    * © 2012 Kadant Inc. All rights reserved . Investing in Operational Efficiencies • New equipment investments and advanced training programs in China • Expanded operations in Mexico to produce wider range of products • Working to expand global sourcing to leverage investments in low cost areas • Focu

  36. Slide 36: Maximizing Aftermarket Potential

    * © 2012 Kadant Inc. All rights reserved . Maximizing Aftermarket Potential • Launching targeted programs to grow parts and consumables business in China • FibreWall™ screen cylinder parts business is a major focus in 2012 • Penetrating deeper into non-paper markets with existing products • Strategi

  37. Slide 37: New Product Innovations

    * © 2012 Kadant Inc. All rights reserved . New Product Innovations • Nano-blades for extended blade life • Detrasher contaminant removal • VeriLite and VeriKleen doctoring • MultiJet™ Twin S cleaning device • High-efficiency corrugator steam system • FibreWall™ screen cylinders

  38. Slide 38: Helping Our Customers Grow

    * © 2012 Kadant Inc. All rights reserved . HELPING OUR CUSTOMERS GROW Strategies in Action

  39. Slide 39: Reducing Freshwater Use in Thailand

    * © 2012 Kadant Inc. All rights reserved . Reducing Freshwater Use in Thailand • Petax™ filtration system provides fresh water usage to benefit mill and local community • Energy savings with reclaimed and reused process water • Higher wastewater treatment efficiency • Local farmers are supplied with

  40. Slide 40: Maximizing Energy Utilization

    * © 2012 Kadant Inc. All rights reserved. Maximizing Energy Utilization • Major rebuild of a dryer section to improve energy utilization at US paper mill • Supplied steam system and related hardware to optimize machine performance • Water demand reduced due to high- efficiency system and components

  41. Slide 41: Addressing the "Ministickies" Challenge

    * © 2012 Kadant Inc. All rights reserved . Addressing the “Ministickies” Challenge • Increased recycled content results in more contaminants to remove from the sheet • Lower basis weights also require new approaches to remove adhesives and contaminants • Kadant’s technologies address the problem – F

  42. Slide 42: Summary

    * © 2012 Kadant Inc. All rights reserved . Summary • Record performance in 2011 – EPS – Operating income, net income – Return on Capital • Investing in the future for sustainable growth – Focus on faster growth emerging markets – Focus on parts and consumables – Upgrades to facilities in China, Mexi

  43. Slide 43: Questions & Answers

    * © 2012 Kadant Inc. All rights reserved . Questions & Answers To ask a question, please call 866-804-6926 within the U.S. or +1-857-350-1672 outside the U.S. and reference 83375884. Please mute the audio on your computer.

  44. Slide 44: Annual Meeting of Stockholders May 23, 2012

    Annual Meeting of Stockholders May 23, 2012 Westford, Massachusetts © 2012 Kadant Inc. All rights reserved .

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