Kadant Inc · NYSE:KAI

Kadant — Q1 2019 Earnings Presentation

26 slides from Kadant's earnings presentation, Apr 29, 2019

  1. Slide 1: First Quarter 2019 Business Review

    Exhibit 99.2 First Quarter 2019 Business Review April 30, 2019

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements that involve a number of risks and uncertainties, including forward-looking statements about our future fin

  3. Slide 3: Use of Non-GAAP Financial Measures

    Use of Non-GAAP Financial Measures In addition to the financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures, including increases or decreases in revenues that exclude the effect of acquisitions and foreign curr

  4. Slide 4: Business Review

    BUSINESS REVIEW Jonathan W. Painter | Chief Executive Officer KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 4

  5. Slide 5: Q1 2019 Financial Highlights

    Q1 2019 Financial Highlights ($ Millions, except per share amounts) Q1 2019 Q1 2018 % Change2 Bookings $183.6 $181.9 0.9% Revenue $171.3 $149.2 14.8% Gross Margin 41.2% 44.3% n.m. Net Income $10.9 $10.9 n.m. Adjusted EBITDA1 $30.0 $23.5 27.3% Adjusted EBITDA Margin1 17.5% 15.8% n.m. Diluted EPS $0.9

  6. Slide 6: FX Translation and Acquisition Impact Q1 2019

    FX Translation and Acquisition Impact Q1 2019 ($ in millions) Revenue Bookings Parts & Consumables Revenue Parts & Consumables Bookings As Reported $171.3 $183.6 $112.9 $120.2 Growth1 14.8% 0.9% 17.6% 16.8% Growth excluding FX2 19.5% 5.2% 22.1% 21.3% Growth excluding FX and Acquisitions3 5.7% -8.3%

  7. Slide 7: Bookings and Revenue

    Bookings and Revenue US$ (millions) BOOKINGS REVENUE $200 $160 $120 $80 $40 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 7

  8. Slide 8: Parts and Consumables Bookings and Revenue

    Parts and Consumables Bookings and Revenue US$ (millions) BOOKINGS REVENUE $140 $120 $100 $80 $60 $40 $20 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 8

  9. Slide 9: North America Bookings and Revenue

    North America Bookings and Revenue US$ (millions) BOOKINGS REVENUE $120 $100 $80 $60 $40 $20 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 9

  10. Slide 10: Europe Bookings and Revenue

    Europe Bookings and Revenue US$ (millions) BOOKINGS REVENUE $60 $50 $40 $30 $20 $10 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 10

  11. Slide 11: Asia Bookings and Revenue

    Asia Bookings and Revenue US$ (millions) BOOKINGS REVENUE $40 $30 $20 $10 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 11

  12. Slide 12: Rest-of-World Bookings and Revenue

    Rest-of-World Bookings and Revenue US$ (millions) BOOKINGS REVENUE $20 $15 $10 $5 $0 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 12

  13. Slide 13: Guidance

    Guidance • FY 2019 GAAP diluted EPS of $4.84 to $4.99 • FY 2019 adjusted diluted EPS* of $5.20 to $5.35 • FY 2019 revenue of $700 to $710 million • Q2 2019 GAAP diluted EPS of $0.99 to $1.05 • Q2 2019 adjusted diluted EPS* of $1.07 to $1.13 • Q2 2019 revenue of $165 to $170 million * Adjusted dilute

  14. Slide 14: Financial Review

    FINANCIAL REVIEW Michael J. McKenney | Executive Vice President & CFO KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 14

  15. Slide 15: Gross Margin

    Gross Margin 50% 47.7% 47.9% 45.6% 45.6% 46.0% 44.9% 45% 44.3% 44.0% 44.1% 43.3% 43.3% 42.3% 41.2% 40% 35% 30% All data for 2017, 2018, and 2019 is presented in conformity with the Financial Accounting Standards Board’s Accounting Standards Update No. 2017-07. Prior period amounts have not been rest

  16. Slide 16: SG&A

    SG&A US$ (millions) SG&A SG&A as a % of Revenues $50 45% $40 40% $30 35% $20 30% $10 25% $0 20% All data for 2017, 2018, and 2019 is presented in conformity with the Financial Accounting Standards Board’s Accounting Standards Update No. 2017-07. Prior period amounts have not been restated. KAI Q119

  17. Slide 17: 1Q18 to 1Q19 Adjusted Diluted EPS

    1Q18 to 1Q19 Adjusted Diluted EPS* $2.00 $1.50 ($0.06) $0.07 $0.04 $0.16 ($0.04) $1.24 $1.07 $1.00 $0.50 $0.00 * Adjusted diluted EPS is a non-GAAP financial measure that excludes certain items as detailed in our press release dated April 29, 2019. KAI Q119 Business Review–April 30, 2019 | © 2019 Ka

  18. Slide 18: Adjusted EBITDA

    Adjusted EBITDA* Adjusted EBITDA* Adjusted EBITDA / Revenue* 25% $35 $30 20% $25 15% $20 % of of Revenue % $15 EBITDA Adjusted 10% $10 5% $5 0% $0 * Adjusted EBITDA and adjusted EBITDA/revenue (margin) are non-GAAP financial measures that exclude certain items as detailed in our press release dated

  19. Slide 19: Cash Flow

    Cash Flow US$ (millions) Q1 2019 Q1 2018 Net Income $11.1 $11.0 Depreciation and Amortization 8.2 6.1 Stock-Based Compensation 1.6 1.5 ROU Asset Amortization 1.1 – Other Items (0.7) (0.1) Change in Current Assets & Liabilities (excl. acquisitions) (11.4) (11.3) Cash Provided by Operating Activities

  20. Slide 20: Key Working Capital Metrics

    Key Working Capital Metrics Q1 2019 Q4 2018 Q1 2018 Days in Receivables 64 59 57 Days in Inventory 85 86 98 Days in Payables 39 35 40 Days in Receivables Days in Inventory Days in Payables 140 120 98 100 86 85 80 Days 57 59 60 64 40 35 40 39 20 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant

  21. Slide 21: Working Capital and Cash Conversion Days

    Working Capital and Cash Conversion Days Q1 2019 Q4 2018 Q1 2018 Working Capital % LTM Revenues* 14.9% 12.5% 13.0% Cash Conversion Days** 110 days 110 days 115 days *Working Capital is defined as current assets less current liabilities, excluding cash and debt. ** Based on days in receivables plus d

  22. Slide 22: Cash and Debt

    Cash and Debt US$ (millions) Q1 2019 Q4 2018 Q1 2018 Cash, cash equivalents, and restricted cash $57.2 $46.1 $73.7 Debt (354.8) (171.4) (235.8) Other borrowings (6.1) (4.4) (5.1) Net debt $(303.7) $(129.7) $(167.2) $75 $33.9 $22.2 $25 $7.2 $2.5 ($25) $(14.7) $(3.3) ($75) ($125) $(135.6) $(129.7) ($1

  23. Slide 23: Leverage Ratio Debt/EBITDA

    Leverage Ratio Debt/EBITDA * 4.00 3.50 3.00 2.33 2.50 2.00 1.50 1.00 0.50 0.00 *Calculated by adding or subtracting certain items from Adjusted EBITDA, as required by our Credit Facility. Our amended and restated Credit Facility defines total debt as debt less worldwide cash of up to $30 million. KA

  24. Slide 24: Questions & Answers

    Questions & Answers To ask a question, please call 888-326-8410 within the U.S. or +1 704-385-4884 outside the U.S. and reference 875 9439. Please mute the audio on your computer. KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 24

  25. Slide 25: Key Take-Aways

    Key Take-Aways • Record Q1 revenue and bookings • Syntron acquisition performing well, integration going according to plan​ • Expecting record revenue and adjusted EBITDA in 2019 KAI Q119 Business Review–April 30, 2019 | © 2019 Kadant Inc. All rights reserved. 25

  26. Slide 26: Kadant

    KADANT

Kadant — Q1 2019 Earnings Presentation on 6ix