Kadant Inc · NYSE:KAI

Kadant — Shareholder Meeting (May 2014)

42 slides from Kadant's shareholder meeting presentation, May 20, 2014

Slide 4: Safe Harbor and Disclaimers
Safe Harbor and Disclaimers The following constitutes a “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: Our presentation today and these slides contain forward-looking statements that involve a number of risks and uncertainties, including forward-looking statement
Slide 5: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures *© 2014 Kadant Inc. All rights reserved. Adjusted net income, adjusted diluted earnings per share (EPS), adjusted operating income, and adjusted EBITDA are non-GAAP financial measures. These non-GAAP financial measures exclude items that are not indicative of our n
Slide 6: Items of Business: Proposal 1 Elect Directors
Items of Business PROPOSAL 1Elect two directors constituting the entire class of directors to be elected for a three-year term expiring in May 2017Dr. John M. AlbertineMr. Thomas C. Leonard *© 2014 Kadant Inc. All rights reserved.
Slide 7: Items of Business: Proposal 2 Advisory Vote on Executive Compensation
Items of Business (cont.) PROPOSAL 2Non-binding advisory vote on executive compensationResolved, that the compensation paid to our company’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation disc
Slide 8: Items of Business: Proposal 3 Equity Incentive Plan Amendments
Items of Business (cont.) PROPOSAL 3Amendments to our 2006 equity incentive plan to increase the shares available for issuance and to extend the plan’s term 10 years *© 2014 Kadant Inc. All rights reserved.
Slide 9: Items of Business: Proposal 4 Ratify KPMG
Items of Business (cont.) PROPOSAL 4Ratify the selection of KPMG LLP as our independent registered public accounting firm for FY 2014 *© 2014 Kadant Inc. All rights reserved.
Slide 11: 2013 Financial Summary
2013 Financial Summary * Adjusted operating income, adjusted diluted EPS, and adjusted EBITDA are non-GAAP financial measures as detailed in our Q4 2013 earnings press release issued February 19, 2014. ($ Millions, except per share amounts and %) 2013 2013 2012 Revenues $ 344.5 $ 344.5 $ 331.8 Gross
Slide 12: First Quarter 2014 Financial Summary
First Quarter 2014 Financial Summary ($ Millions, except per share amounts and %) 1Q14 1Q13 Revenues $ 93.4 $ 76.2 Gross Profit Margin 45.2% 47.3% Operating Income $ 7.6 $ 7.4 Net Income from Continuing Operations $ 5.1 $ 5.3 Diluted EPS from Continuing Operations $ 0.45 $ 0.47 Adjusted EBITDA* $ 12
Slide 13: Free Cash Flow
Free Cash Flow Note: Free cash flow is defined as cash flows from continuing operations less purchases of property, plant, and equipment. US$ (millions) *© 2014 Kadant Inc. All rights reserved.
Slide 15: A Look Back at Our Financial Targets Set in 2013
A Look Back at Our Financial Targets Set in 2013(Targets for 2017) ($ in Millions, except per share amounts) ($ in Millions, except per share amounts) Revenues $500-$550 EBITDA $60-$80 Diluted EPS $4.00-$5.00 Operating Cash Flow $45-$60 Acquisitions Internal Growth Initiatives Base Business Stock Re
Slide 16: Advancing Toward Our Goals
Advancing Toward Our Goals Internal GrowthNumerous internal growth programsAcquisitionsThree acquisitions completed in 2013Stock repurchasesPurchased 175,000 shares in 2013Cash dividends Paid $4.2 million 2013Current dividend 15 cents per quarter *© 2013 Kadant Inc. All rights reserved.
Slide 17: Adjusted EBITDA
Adjusted EBITDA (in millions) 2010 2011 2012 2013 2014F* Net Income Attributable to Kadant $ 18.5 $ 33.6 $ 31.6 $ 23.4 $ 30.0 Net Income Attributable to Noncontrolling Interest 0.2 0.3 0.2 0.2 0.3 (Income) Loss from Discontinued Operation, Net of Tax (0.1) - (0.7) 0.1 - Income Tax Provision 5.2 4.3
Slide 18: Revenues and Adjusted EBITDA
Revenues and Adjusted EBITDA US$ (millions) * Represents an estimate for 2014 equal to the mid-range of the revenue guidance provided by management in our Q1 2014 earnings press release issued April 29, 2014. Note: Adjusted EBITDA is a non-GAAP financial measure that excludes certain items as detail
Slide 19: Major Growth Initiatives
Major Growth Initiatives Grow our parts and consumables businessDevelop innovative products and technologiesPursue new applications for our products in other industriesAcquire complementary businesses *© 2014 Kadant Inc. All rights reserved.
Slide 21: Growing Our Parts and Consumables Business
Growing Our Parts and Consumables Business Growing China parts businessScreen cylinder growth with new FibreWall™ basketAcquisitionsNoss cleaners and mediaCarmanah knivesRadiance bladesR&D efforts to create new aftermarket solutions *© 2014 Kadant Inc. All rights reserved. 2013 Revenues 62% 38%
Slide 22: Product Development
Product Development Filling out our core product lines High-efficiency disc filterHigh-capacity, low-energy drum pulperExtended life blades for tissue and packagingInnovating for new marketsThermoMax™ steam system for high-speed box plantsVeriLite™ and VeriKleen™ roll cleaning assemblies *© 2014 Kad
Slide 32: Acquisitions to Enhance Value
Acquisitions to Enhance Value Selectively pursuing strategic companies and technologiesRecent acquisitions expanded our product lines, strengthened our presence in emerging markets, and diversified our industrial baseCBTI, BrazilNoss Group, SwedenCarmanah, CanadaRadiance, France *© 2014 Kadant Inc.
Slide 33: Carmanah Design & Manufacturing Inc.
Carmanah Design & Manufacturing Inc. Leading manufacturer of equipment used to debark and cut logs into thin strands that are pressed into engineered Oriented Strand Board (OSB) Approximately 70% of revenues from parts and consumables $150,000 to $200,000 annualrevenues per installed ring stranderRe
Slide 34: OSB Production Process
OSB Production Process Log hauling and sorting Jackladder DEBARKING STRANDING Wet bins, drying, and blending Forming, pressing, and finishing *© 2014 Kadant Inc. All rights reserved.
Slide 35: North American OSB Demand by End Use
North American OSB Demand by End UseBillions of Square Feet, 3/8-Inch Basis *© 2014 Kadant Inc. All rights reserved. Source: Forest Economic Advisors, LLC
Slide 36: Radiance Technology Acquisition
Radiance Technology Acquisition Premium blades for creping and coatingExtends current product mix to new applications and marketsDoubling production capacityIntegration into existing operations moving forwardEstimated $60 million market* *© 2014 Kadant Inc. All rights reserved. * Company estimate ba
Slide 37: Cumulative Stock Repurchases
Cumulative Stock Repurchases(Through May 19, 2014) US$ (millions) *© 2013 Kadant Inc. All rights reserved. Represents cumulative aggregate dollar amount expended by Kadant pursuant to repurchase programs since 2004.
Slide 38: Stock Repurchases and Dividends
Stock Repurchases and Dividends ($ in Millions, except per share amounts) 2013 2012 2011 Common Stock Repurchases $5.4 $14.5 $16.1 Average Price per Share $30.67 $22.87 $21.52 Cash Dividends $4.2 - - Total Stock Repurchases and Dividends $9.6 $14.5 $16.1 Net Income from Continuing Operations $23.5 $
Slide 39: Kadant in 2017
Kadant in 2017 ($ in Millions, except per share amounts) ($ in Millions, except per share amounts) Revenues $500-$550 EBITDA $60-$80 Diluted EPS $4.00-$5.00 Operating Cash Flow $45-$60 Acquisitions Internal Growth Initiatives Base Business Stock Repurchases 2017 Diluted EPS Average revenue growth of
Slide 40: Kadant in 2014
Kadant in 2014 Strong cash flowsParts and consumables business strong and growingDeveloping new productsExpanding into new industrial markets Successful acquisition strategyStrong history of returning capital to stockholdersHealthy balance sheet *© 2014 Kadant Inc. All rights reserved.
Slide 41: Questions & Answers
Questions & Answers To ask a question, please call 877-703-6107 within the U.S. or +1-857-244-7306 outside the U.S. and reference 83375884. Please mute the audio on your computer when calling. *© 2014 Kadant Inc. All rights reserved.
Slide 42: Annual Meeting of Stockholders
Annual Meeting of Stockholders May 20, 2014 Westford, Massachusetts

Kadant — Shareholder Meeting (May 2014) on 6ix

Kadant — Shareholder Meeting (May 2014)

Slide 1: Annual Meeting of Stockholders

Slide 2: Annual Meeting of Stockholders

Slide 3: Items of Business

Slide 4: Safe Harbor and Disclaimers

Slide 5: Use of Non-GAAP Financial Measures

Slide 6: Items of Business: Proposal 1 Elect Directors

Slide 7: Items of Business: Proposal 2 Advisory Vote on Executive Compensation

Slide 8: Items of Business: Proposal 3 Equity Incentive Plan Amendments

Slide 9: Items of Business: Proposal 4 Ratify KPMG

Slide 10: Business Review

Slide 11: 2013 Financial Summary

Slide 12: First Quarter 2014 Financial Summary

Slide 13: Free Cash Flow

Slide 14: 2014 Growth Initiatives

Slide 15: A Look Back at Our Financial Targets Set in 2013

Slide 16: Advancing Toward Our Goals

Slide 17: Adjusted EBITDA

Slide 18: Revenues and Adjusted EBITDA

Slide 19: Major Growth Initiatives

Slide 20: Growing Our Parts and Consumables Business

Slide 21: Growing Our Parts and Consumables Business

Slide 22: Product Development

Slide 23: Stock Preparation Product Line Extension: High Efficiency Disc Filter

Slide 24: Stock Preparation Product Line Extension: Drum Pulper

Slide 25: Extended Life Blades for Tissue and Packaging

Slide 26: ThermoMax Steam System for Corrugated Machines

Slide 27: New Market Development

Slide 28: VeriLite Roll Cleaner

Slide 29: Oil & Gas Recovery and Refining Parts and Consumables

Slide 30: Serving Global Food Producers

Slide 31: Bio-energy / Municipal Waste Solutions

Slide 32: Acquisitions to Enhance Value

Slide 33: Carmanah Design & Manufacturing Inc.

Slide 34: OSB Production Process

Slide 35: North American OSB Demand by End Use

Slide 36: Radiance Technology Acquisition

Slide 37: Cumulative Stock Repurchases

Slide 38: Stock Repurchases and Dividends

Slide 39: Kadant in 2017

Slide 40: Kadant in 2014

Slide 41: Questions & Answers

Slide 42: Annual Meeting of Stockholders