Kadant Inc · NYSE:KAI
Kadant — Q1 2017 Earnings Presentation
25 slides from Kadant's earnings presentation, May 2, 2017
Slide 1: First Quarter 2017 Business Review
First Quarter 2017 Business Review Jonathan W. Painter, President & CEO Michael J. McKenney, Senior Vice President & CFO
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 and our accompanying commentary contains forward-looking statements that involve a number of risks and uncertainties, including forward-looking
Slide 3: Use of Non-GAAP Financial Measures
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 or decreases in revenues excluding the effect of acquisitions and foreign currency tra
Slide 4: Business Review
BUSINESS REVIEW Jonathan W. Painter President & CEO
Slide 5: Q1 2017 Financial Highlights
Q1 2017 Financial Highlights ($ Millions, except per share amounts) Q1 2017 Q1 2016 % CHANGE2 EXCL. FX2 Revenue $102.9 $96.5 6.5% 7.5% Gross Margin 47.6% 45.6% n.m. n.m. Net Income $9.0 $6.9 30.2% 33.2% Adjusted EBITDA1 $15.3 $13.7 11.3% 12.9% Adjusted EBITDA/Revenue1 14.9% 14.2% n.m. n.m. Diluted E
Slide 6: FX Translation and Acquisition Impact
FX Translation and Acquisition Impact Q1 2017, $ in millions except EPS Revenue Adjusted EPS4 Bookings Parts & Consumables Revenue Parts & Consumables Bookings As Reported $102.9 $0.80 $118.9 $70.4 $74.6 Growth1 6.5% 11.1% 22.6% 11.4% 20.5% Growth excluding FX2 7.5% 13.9% 24.1% 12.2% 21.2% Growth ex
Slide 7: Bookings and Revenues
$0 $20 $40 $60 $80 $100 $120 Bookings Booking Reversal Revenues Bookings and Revenues US$ (millions) 1 Reported Q415 bookings were $76 million, which included new orders of $92 million and a booking reversal of $16 million. 1 KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reser
Slide 8: Parts and Consumables Bookings and Revenues
Parts and Consumables Bookings and Revenues KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 8 US$ (millions) $0 $10 $20 $30 $40 $50 $60 $70 $80 Bookings Revenues
Slide 9: North America Bookings and Revenues
North America Bookings and Revenues US$ (millions) KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 9 $0 $10 $20 $30 $40 $50 $60 $70 $80 Bookings Revenues
Slide 10: Europe Bookings and Revenues
Europe Bookings and Revenues US$ (millions) KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 10 $0 $5 $10 $15 $20 $25 $30 $35 Bookings Revenues
Slide 11: Asia Bookings and Revenues
Asia Bookings and Revenues US$ (millions) 1 Reported Q415 Asia bookings were negative $6 million, which included new orders of $10 million and a booking reversal of $16 million. 1 KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 11 -$10 -$5 $0 $5 $10 $15 $20 $25 $30 $35
Slide 12: Rest-of-World Bookings and Revenues
Rest-of-World Bookings and Revenues US$ (millions) KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 12 $0 $2 $4 $6 $8 $10 $12 $14 $16 Bookings Revenues
Slide 13: Guidance
Guidance • FY 2017 GAAP diluted EPS of $3.27 to $3.37 • FY 2017 revenue of $427 to $437 million • Q2 2017 GAAP diluted EPS of $0.87 to $0.91 • Q2 2017 revenue of $107 to $110 million KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 13
Slide 14: Financial Review
FINANCIAL REVIEW Michael J. McKenney Senior Vice President & Chief Financial Officer
Slide 15: Quarterly Gross Margins
Quarterly Gross Margins KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 15 47.3% 48.6% 43.9% 43.9% 45.2% 43.0% 44.7% 44.7% 48.1% 46.5% 47.5% 43.1% 45.6% 44.9% 45.6% 46.0% 47.6% 36% 38% 40% 42% 44% 46% 48% 50%
Slide 16: Quarterly SG&A
Quarterly SG&A US$ (millions) KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 16 25% 30% 35% 40% 45% $0 $10 $20 $30 $40 SG&A SG&A as a % of Revenues
Slide 17: 1Q16 to 1Q17 Adjusted Diluted EPS
1Q16 to 1Q17 Adjusted Diluted EPS KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 17 $0.72 $0.23 $0.07 $0.03 ($0.21) ($0.04) $0.80 $0.00 $0.25 $0.50 $0.75 $1.00 $1.25
Slide 18: Cash Flow
Cash Flow US$ (millions) 1Q17 1Q16 Net Income $9.1 $7.0 Depreciation and Amortization 3.3 2.6 Stock-Based Compensation 1.3 1.3 Other Items 0.2 0.2 Change in Current Assets & Liabilities (excl. acquisition) (12.2) (5.6) Cash Provided by Operating Activities $1.7 $5.5 KAI 1Q17 Business Review–May 2, 2
Slide 19: Key Working Capital Metrics
Key Working Capital Metrics 1Q17 4Q16 1Q16 Days in Receivables 67 62 60 Days in Inventory 96 94 99 Days in Payables 42 40 41 KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 19 60 62 67 99 94 96 41 40 42 0 25 50 75 100 125 D AY S Days in Receivables Days in Inventory Da
Slide 20: Working Capital and Cash Conversion Days
Working Capital and Cash Conversion Days 1Q17 4Q16 1Q16 Working Capital % LTM Revenues* 14.1% 11.0% 15.1% Cash Conversion Days** 120 days 117 days 118 days *Working Capital is defined as current assets less current liabilities, excluding cash and debt. ** Based on days in receivables plus days in in
Slide 21: Cash and Debt
Cash and Debt US$ (millions) 1Q17 4Q16 1Q16 Cash, cash equivalents, and restricted cash $73.0 $73.6 $106.1 Debt (65.6) (61.5) (72.2) Lease obligations (4.9) (4.9) - Net Cash $2.5 $7.2 $33.9 KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 21 U S$ ( m ill io n s) $51.8 $
Slide 22: Leverage Ratio
Leverage Ratio KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 22 *Calculated by adding or subtracting certain items from Adjusted EBITDA, as required by our Credit Facility. Effective March 2, 2017, our amended and restated Credit Facility defined total debt as debt l
Slide 23: 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 55 110 79. Please mute the audio on your computer. KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 23
Slide 24: Q1 2017 Key Take-Aways
Q1 2017 Key Take-Aways • Record bookings • Record bookings and revenue for parts and consumables • Solid EPS performance • Strong demand in China and Russia • Raising full-year revenue and EPS guidance KAI 1Q17 Business Review–May 2, 2017 | © 2017 Kadant Inc. All rights reserved. 24
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