Slide 1: First Quarter 2022 Business Review
First Quarter 2022 Business Review May 4, 2022 Exhibit 99.2
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
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 revenue excluding the effect of acquisitions and foreign currency
Slide 4: Business Review
BUSINESS REVIEW Jeffrey L. Powell, President & CEO 4KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED.
Slide 5: Operational Highlights
Operational Highlights • Strong demand continued into the first quarter leading to record bookings and revenue • Solid execution by our businesses led to excellent financial performance and record adjusted EBITDA* • Capital project activity continued its momentum in Q1 despite increasing economic he
Slide 6: Q1 2022 Performance
Q1 2022 Performance 6 Q1 22 Q1 21 Change Revenue $226.5 $172.5 +31.3% Net Income $41.2 $16.6 +148.7% Adjusted EBITDA* $45.8 $32.4 +41.4% Adjusted EBITDA Margin* 20.2% 18.8% +140 bps Diluted EPS $3.53 $1.43 +146.9% Adjusted Diluted EPS* $2.28 $1.53 +49.0% Operating Cash Flow $23.8 $19.1 +24.5% Free C
Slide 7: Flow Control
$76.0 $71.8 $76.7 $83.7 $100.1 1Q21 2Q21 3Q21 4Q21 1Q22 Flow Control 7 $ in millions Q1 22 Q1 21 Change Revenue $85.8 $63.8 +34.6% Bookings $100.1 $76.0 +31.7% Adjusted EBITDA* $23.9 $18.0 +32.8% Adjusted EBITDA Margin* 27.9% 28.3% -40 bps HIGHLIGHTS • Strong aftermarket demand and capital project a
Slide 8: Industrial Processing
$86.6 $101.9 $118.9 $94.9 $106.3 1Q21 2Q21 3Q21 4Q21 1Q22 Industrial Processing 8 $ in millions Q1 22 Q1 21 Change Revenue $93.1 $69.2 +34.6% Bookings $106.3 $86.6 +22.8% Adjusted EBITDA* $22.0 $14.5 +51.4% Adjusted EBITDA Margin* 23.6% 21.0% +260 bps HIGHLIGHTS • Strong end-market demand drove book
Slide 9: Material Handling
$41.9 $39.4 $49.1 $52.2 $59.6 1Q21 2Q21 3Q21 4Q21 1Q22 Material Handling 9 $ in millions Q1 22 Q1 21 Change Revenue $47.6 $39.6 +20.3% Bookings $59.6 $41.9 +42.4% Adjusted EBITDA* $9.7 $7.1 +35.5% Adjusted EBITDA Margin* 20.3% 18.0% +230 bps HIGHLIGHTS • Demand was strong for our baling and bulk mat
Slide 10: Business Outlook
Business Outlook • Demand expected to remain solid with some potential for softening in the second half of 2022 • Supply chain constraints and inflationary pressures expected to continue along with macroeconomic headwinds growing • Expecting to generate record earnings in fiscal 2022 10KAI 1Q22 BUSI
Slide 11: Financial Review
FINANCIAL REVIEW Michael J. McKenney, EVP & CFO KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED. 11
Slide 12: Q1 2022 Financial Performance
Q1 2022 Financial Performance Q1 22 Q1 21 Gross Margin 43.4% 43.9% SG&A % of Revenue 26.1% 28.7% Operating Income $56.0 $23.4 Net Income $41.2 $16.6 Adjusted EBITDA* $45.8 $32.4 Diluted EPS $3.53 $1.43 Adjusted Diluted EPS* $2.28 $1.53 HIGHLIGHTS • Adjusted EBITDA margin* of 20.2% • Operating cash f
Slide 13: Key Consolidated Financial Metrics
$16.8 $42.3 $34.6 $55.9 $20.9 1Q21 2Q21 3Q21 4Q21 1Q22 FREE CASH FLOW* OPERATING CASH FLOW 18.8% 21.1% 20.5% 20.5% 20.2% 1Q21 2Q21 3Q21 4Q21 1Q22 28.7% 25.2% 26.2% 26.4% 26.1% 1Q21 2Q21 3Q21 4Q21 1Q22 43.9% 43.6% 41.9% 42.4% 43.4% 1Q21 2Q21 3Q21 4Q21 1Q22 Key Consolidated Financial Metrics CASH FLOW
Slide 14: 1Q21 to 1Q22 Adjusted Diluted EPS
$1.53 $0.96 $0.16 $0.02 $0.01 ($0.26) ($0.09) ($0.04) ($0.01) $2.28 1Q21 to 1Q22 Adjusted Diluted EPS* KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED. 14 1Q21 ADJ EPS* 1Q22 ADJ EPS* REVENUE ACQUISTIONS INTEREST EXPENSE TAX PROVISION OPERATING EXPENSE GOV’T PROGRAMS GROSS
Slide 15: Key Liquidity Metrics
Key Liquidity Metrics $ in millions Q1 22 Q4 21 Q1 21 Cash, cash equivalents, and restricted cash $89.0 $94.2 $66.7 Debt $243.4 $264.6 $217.3 Lease obligations $4.5 $4.9 $5.2 Net Debt $158.9 $175.4 $155.8 Leverage ratio1 1.16 1.34 1.50 Working capital % LTM revenue2 10.8% 9.4% 15.1% Cash conversion
Slide 16: Guidance
Guidance 16KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED. • FY 2022 GAAP diluted EPS of $10.05 to $10.25 • FY 2022 adjusted diluted EPS* of $8.80 to $9.00 • FY 2022 revenue of $885 to $905 million • Q2 2022 GAAP diluted EPS of $1.86 to $1.96 • Q2 2022 revenue of $215 to
Slide 17: 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 858 2925. Please mute the audio on your computer. KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED. 17
Slide 18: 2022 Key Priorities
2022 Key Priorities 18 ACCELERATE SUSTAINABLE INDUSTRIAL PROCESSING DELIVER EXCEPTIONAL STAKEHOLDER VALUE MAINTAIN STRONG CASH FLOW CAPITALIZE ON NEW OPPORTUNITIES KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED.
Slide 19: Investor Relations Contact
INVESTOR RELATIONS CONTACT Michael McKenney, 978-776-2000 IR@kadant.com MEDIA RELATIONS CONTACT Wes Martz, 269-278-1715 media@kadant.com May 4, 2022
Slide 20: Appendix
APPENDIX First Quarter 2022 Business Review KAI 1Q22 BUSINESS REVIEW–MAY 2022 | © 2022 KADANT INC. ALL RIGHTS RESERVED. 20
Slide 21: Revenue by Customer Location
Revenue by Customer Location $ in thousands Q1 22 Q1 21 Change Change Excl. Acquisitions and FX* North America $124,336 $95,092 $29,244 $20,423 Europe 58,366 44,641 13,725 10,099 Asia 31,987 21,813 10,174 7,200 Rest of World 11,791 10,917 874 175 TOTAL $226,480 $172,463 $54,017 $37,897 KAI 1Q22 BUSI
Slide 22: Adjusted Diluted EPS Reconciliation
Adjusted Diluted EPS Reconciliation Q1 22 Q1 21 Diluted EPS, as reported $3.53 $1.43 Impairment Costs, Net of Tax 0.01 - Gain on Sale, Net of Tax (1.30) - Acquisition Costs, Net of Tax 0.01 0.10 Acquired Profit in Inventory and Backlog Amortization, Net of Tax 0.03 - Adjusted Diluted EPS* $2.28 $1.5
Slide 23: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures. Adjusted EBITDA margin is calculated by dividing adjusted EBITDA in a given period by revenue in the same period. $ in thousands Q1 22 Q1 21 Net Income Attributable to Kadant $41,192 $16,561 Ne
Slide 24: Notes
Notes PRESENTATION NOTES • All references to EPS (earnings per share) are to our EPS as calculated on a diluted basis. • Percent change in slides 6-9 is calculated using actual numbers reported in our press release dated May 3, 2022. FOOTNOTES 1) Leverage ratio is calculated by dividing total debt b