Slide 1: Fourth Quarter and Full-Year 2012 Business Review
Fourth Quarter and Full-Year 2012 Business Review Jonathan W. Painter, President & CEO Thomas M. O’Brien, Executive Vice President & CFO
Slide 2: Forward-Looking Statements
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. 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
Slide 3: Use of Non-GAAP Financial Measures
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. 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 o
Slide 4: Financial Classifications
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Financial Classifications Starting in the first quarter of 2012, all geographic revenues and bookings data are attributed to regions based on customer locations. In addition, we segregated our Chemical pulping produ
Slide 5: Business Review
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. BUSINESS REVIEW Jonathan W. Painter President & CEO
Slide 6: Q4 2012 Financial Highlights
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Q4 2012 Financial Highlights ($ Millions, except per share amounts) Q4 2012 Q4 2011 % CHANGE Revenue 78.1 97.0 -19.5% Gross Margin 43.0% 38.6% n.a. Diluted EPS1 0.84 0.90 -6.7% Adjusted Diluted EPS1 0.44 0.59 -25.4%
Slide 7: 2012 Financial Highlights
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. 2012 Financial Highlights ($ Millions, except per share amounts) 2012 2011 Revenues $331.8 $335.5 Gross Margins 43.9% 43.3% Diluted EPS1 $2.66 $2.74 Adjusted Diluted EPS1,2 $2.29 $2.10 Adjusted EBITDA1,2 $44.8 $44.8
Slide 8: Dividend and Free Cash Flow
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Dividend Board authorized quarterly dividend of $0.125 per share Initial dividend record date April 11, 2013; payment May 9, 2013 Free Cash Flow *($ in millions) * Free Cash Flow is cash flow from continuing operati
Slide 9: Revenue By Product Line: Q4 2012
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Revenue By Product Line: Q4 2012 $78.1 million, down 19.5% compared to Q4 2011 ($ Millions) Q4 2012 Q4 2011 % CHANGE EXCL. FX Stock-Preparation $28.1 $43.2 -35.1% -34.5% Doctoring, Cleaning, & Filtration 24.8 23.4 6
Slide 10: Bookings By Product Line: Q4 2012
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Bookings By Product Line: Q4 2012 $76.0 million, down 3.4% compared to Q4 2011 Percent change calculated using actual numbers reported in our Q4 2012 earnings release dated February 26, 2013. ($ Millions) Q4 2012 Q4
Slide 11: Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Bookings and Revenues US$ (millions)
Slide 12: Parts and Consumables Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Parts and Consumables Bookings and Revenues US$ (millions)
Slide 13: Regional Performance
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. REGIONAL PERFORMANCE
Slide 14: North America Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. North America Bookings and Revenues US$ (millions)
Slide 15: Europe Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Europe Bookings and Revenues US$ (millions)
Slide 16: China Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. China Bookings and Revenues US$ (millions)
Slide 17: China Parts and Consumables Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. China Parts and Consumables Revenues US$ (millions) CAGR = 27% Revenues for China-based subsidiaries.
Slide 18: Rest-of-World Bookings and Revenues
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Rest-of-World Bookings and Revenues US$ (millions)
Slide 19: Guidance for Continuing Operations
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Guidance for Continuing Operations Q1 2013 GAAP diluted EPS of $0.32 to $0.34 Q1 2013 revenues of $71 to $73 million FY 2013 GAAP diluted EPS of $1.80 to $1.90 FY 2013 revenues of $320 to $330 million
Slide 20: Financial Review
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. FINANCIAL REVIEW Thomas M. O’Brien Executive Vice President & Chief Financial Officer
Slide 21: Quarterly Gross Margins
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Quarterly Gross Margins
Slide 22: Full-Year Gross Margins
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Full-Year Gross Margins
Slide 23: Quarterly SG&A
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Quarterly SG&A
Slide 24: Full-Year SG&A
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Full-Year SG&A
Slide 25: Adjusted Diluted EPS Q4 2012
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Adjusted Diluted EPS Q4 2012 Q4 2012 Q4 2011 Q4 2011 $ in millions Diluted EPS $ in millions Diluted EPS Net Income and Diluted EPS from Continuing Operations, as reported $9.6 $0.84 $10.7 $0.90 Restructuring Costs
Slide 26: 4Q11 to 4Q12 Adjusted Diluted EPS from Continuing Operations
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. 4Q11 to 4Q12 Adjusted Diluted EPS from Continuing Operations
Slide 27: Cash Flow
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Cash Flow ($ Millions) 4Q12 4Q11 2012 2011 Income from Continuing Operations $9.7 $10.7 $31.1 $33.9 Depreciation and Amortization 2.0 2.0 8.1 7.9 Stock-Based Compensation 1.2 1.0 4.8 3.9 Other Items (5.3) (1.9) (4.7
Slide 28: Stock Repurchases
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Stock Repurchases ($ in Millions, except per share amounts) 2012 2011 Common Stock Repurchases $14.5 $16.1 Average Price per Share $22.87 $21.52 Net Income from Continuing Operations $30.9 $33.6 % of Stock Repurchas
Slide 29: Working Capital
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Working Capital 4Q12 3Q12 4Q11 Working Capital % LTM Revenues* 13.9% 13.4% 9.9% *Working Capital is defined as current assets less current liabilities, excluding cash, debt, and the discontinued operation.
Slide 30: Cash and Debt
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Cash and Debt ($ Millions) 4Q12 3Q12 4Q11 Cash, cash equivalents, restricted cash $54.6 $53.4 $47.7 Debt (6.9) (11.9) (12.3) Net Cash $47.7 $41.5 $35.4
Slide 31: Leverage Ratio
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Leverage Ratio * Calculated by adding or subtracting certain items, as required by our Credit Facility, from Adjusted EBITDA. Under our new Credit Facility entered into on August 3, 2012 total debt is defined as deb
Slide 32: Questions & Answers
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Questions & Answers To ask a question, please call 866-804-6926 within the U.S. or +1-857-350-1672 outside the U.S. and reference 83375884. Please mute the audio on your computer.
Slide 33: Fourth Quarter and Full-Year 2012 Business Review
Fourth Quarter and Full-Year 2012 Business Review Jonathan W. Painter, President & CEO Thomas M. O’Brien, Executive Vice President & CFO
Slide 34: Appendix
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. APPENDIX Investor Contact: Thomas M. O’Brien, 978-776-2000
Slide 35: Appendix: Revenue 2012 and 2011
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Appendix: Revenue 2012 2011 ($ Millions) 2012 2011 % Change Parts & Consumables $189.9 $187.5 1% Capital $141.9 $148.0 -4% Total $331.8 $335.5 -1%
Slide 36: Adjusted Diluted EPS
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Adjusted Diluted EPS 2012 2012 2011 2011 $ in millions Diluted EPS $ in millions Diluted EPS Net Income and Diluted EPS from Continuing Operations, as reported $30.9 $2.66 $33.6 $2.74 Restructuring Costs and Other E
Slide 37: Appendix: Adjusted Diluted EPS from Continuing Operations
* KAI 4Q12 Business Review–February 27, 2013 © 2013 Kadant Inc. All rights reserved. Appendix: Adjusted Diluted EPS from Continuing Operations