Latest news with #adjustedEPS
Yahoo
29-05-2025
- Business
- Yahoo
Columbus McKinnon Corp (CMCO) Q4 2025 Earnings Call Highlights: Navigating Challenges with ...
Net Sales: $963 million for fiscal 2025, down 4% year over year on a constant currency basis. Fourth Quarter Sales: $246.9 million, down 5% from the prior year on a constant currency basis. Backlog: $322.5 million, a 15% increase versus the prior year. Gross Profit: $79.8 million in the fourth quarter, decreased by $14.5 million year over year. Gross Margin: 32.3% on a GAAP basis; 35.2% on an adjusted basis. Adjusted Operating Income: $24.1 million in the fourth quarter. Adjusted Operating Margin: 9.8% in the fourth quarter. Adjusted EPS: $0.60 for the fourth quarter. Adjusted EBITDA: $36.1 million in the fourth quarter, with a margin of 14.6%. Free Cash Flow: $29.5 million in the fourth quarter. Debt Repayment: $60 million paid down in fiscal 2025, including $15 million in the fourth quarter. Net Leverage Ratio: 3.1 times on a financial covenant basis. Fiscal 2026 Guidance: Net sales growth flat to slightly up; adjusted EPS growth flat to slightly up. Warning! GuruFocus has detected 3 Warning Sign with CMCO. Release Date: May 28, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Columbus McKinnon Corp (NASDAQ:CMCO) delivered record orders in fiscal '25, with a 4% increase versus the prior year on a constant currency basis. The company saw strong growth in project-related orders, particularly in precision conveyance, which was up 19% year over year. Backlog increased by 15% to $322.5 million, positioning the company well for fiscal '26. Operational execution improved, with a top-tier TRIR of 0.54 and a 10-point improvement in net promoter score in the EMEA region. The pending acquisition of Keto Crosby is expected to scale the business, expand customer capabilities, and accelerate the intelligent motion strategy. Net sales were down 4% year over year on a constant currency basis, reflecting lower volume due to short cycle order softness. Gross profit decreased by $14.5 million due to lower sales volume, mix, and factory closure costs. Tariffs are expected to be a headwind, with a $0.20 to $0.30 impact on adjusted EPS in the first half of fiscal 2026. The company faces macroeconomic uncertainty and volatility related to the evolving US policy landscape. Short cycle orders remain sensitive to channel dynamics, impacted by policy uncertainty and channel consolidation. Q: What is the tariff rate embedded for China and the EU, and how might the Keto Crosby acquisition impact tariff mitigation? A: David Wilson, President and CEO, explained that the tariff rates considered are 145% for China and 10% for the EU. The company is advancing integration planning for Keto Crosby, which could potentially help mitigate tariff impacts quicker or more effectively than currently guided. Q: How has the short cycle order trend been through April and early June, and what is expected for Keto Crosby? A: David Wilson noted that short cycle sales improved in the latter part of Q4, showing a flat year-over-year performance, which was a significant improvement from Q3. While he couldn't comment on Keto Crosby's results, similar activity levels are anticipated. Q: Can you elaborate on the tariff situation and the expected mitigation measures? A: David Wilson stated that the company expects a $40 million tariff headwind, with mitigation through surcharges, pricing, and supply chain management. The guidance assumes flat to slightly up revenue, with potential volume reductions due to price increases. Q: What is driving the strength in precision conveyance orders, and how are margins in this area? A: David Wilson highlighted robust demand in precision conveyance, with a 19% year-over-year order growth. This demand is driven by sectors like battery production, life sciences, and e-commerce, with contributions from Mantra Tech and Dorner businesses. Q: Why was the mix negative to margin despite strong precision conveyance orders? A: David Wilson explained that while orders were strong, sales were down, impacting margins due to lower volume and mix. The company expects improvements in fiscal '26 as volume ramps up, particularly in precision conveyance and North American linear motion businesses. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-05-2025
- Business
- Yahoo
Amadeus IT Group SA (AMADF) Q1 2025 Earnings Call Highlights: Strong Revenue Growth Amid Market ...
Group Revenue Growth: Increased by 9% in Q1 2025. Operating Income Growth: Increased by 10%. Profit Growth: Increased by 13%. Free Cash Flow: EUR 262 million generated in the quarter. Leverage: 0.8 times net debt to last 12 months EBITDA. Air Distribution Revenue Growth: Increased by 8%. Bookings Growth: Year-on-year growth of around 3%. Revenue per Booking Growth: Increased by 5%. IT Solutions Revenue Growth: Increased by 11%. Passenger Boarded Growth: Increased by around 6%. Hospitality and Other Solutions Revenue Growth: Increased by 11%. EBITDA Margin: 38.5%, 0.4 points below prior year. Adjusted Profit Growth: Increased by 12.3%. Diluted Adjusted EPS Growth: Increased by 12.2%. CapEx Growth: Increased by 30.9%, representing 12.7% of revenue. Warning! GuruFocus has detected 4 Warning Signs with BOM:500495. Release Date: May 08, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Amadeus IT Group SA (AMADF) reported a 9% increase in group revenue for Q1 2025, with operating income and adjusted operating income both increasing by 10%. The company generated EUR 262 million in free cash flow during the quarter, maintaining a leverage ratio of 0.8 times net debt to last 12 months EBITDA. Air Distribution revenue grew by 8%, with bookings processed through the Amadeus platform experiencing year-on-year growth of around 3% and revenue per booking advancing by 5%. IT Solutions revenue increased by 11%, supported by a 6% growth in Amadeus passengers boarded and a 5% increase in revenue per passenger boarded. Amadeus continues to expand its leadership in Airline Distribution, with significant progress in its NDC strategy and new agreements with major airlines like Emirates, Etihad, and Indigo. Despite positive financial performance, Amadeus IT Group SA (AMADF) faced softer volumes than expected, with some regions underperforming due to external factors such as severe weather conditions and geopolitical events. The company noted macroeconomic uncertainty and high US euro exchange rate volatility, which could impact global traffic growth and financial performance. Amadeus' free cash flow in Q1 2025 was down 22% compared to the previous year, attributed to increased CapEx, higher working capital outflow, taxes, and interest paid. The company faces challenges in the US market, which is currently experiencing softness, impacting overall industry performance. Amadeus' Hospitality and Other Solutions segment reported softer growth in Digital Media due to a reduction in customers' media spend. Q: Could you comment on the Distribution business outlook and your confidence in holding the guidance given the market conditions? A: Luis Maroto Camino, CEO, explained that the Distribution business is influenced by industry trends, commercial success, and pricing evolution. While industry growth is uncertain, Amadeus is confident in its commercial capabilities and pricing strategies. The top end of the guidance range would require stronger traffic recovery, but the company remains confident in its ability to meet the guidance based on current conditions. Q: How is the sales pipeline for Nevio in the Air IT business, and are airlines more interested now? A: Decius Valmorbida, President - Travel Unit, noted that the pipeline for Nevio is accelerating, with increased interest from airlines following recent agreements with major carriers. The company expects continued interest and potential new agreements in the future. Q: Can you provide an update on the progress of Marriott and Accor migrations to the CRS in the Hospitality segment? A: Luis Maroto Camino, CEO, stated that the migrations are progressing well. Marriott's impact will start this year with a bigger impact in 2026, while Accor will see some impact in 2026 and a larger impact in 2027. This is expected to positively accelerate the hospitality business in the latter half of the year. Q: What measures are you considering to adjust costs in case of a downturn, and how have unexpected events impacted bookings? A: Luis Maroto Camino, CEO, mentioned that cost adjustments are considered based on revenue evolution, with a focus on protecting medium-term investments and commitments. Unexpected events like climate and geopolitical issues are difficult to predict, but the company tries to assess underlying growth excluding one-offs. Q: How should we think about the structural improvement in pricing per booking in the long term? A: Luis Maroto Camino, CEO, explained that while recent years have seen extraordinary pricing improvements due to contract changes, future growth will depend on inflation and business mix. The company expects positive booking fee growth in the medium term, though specific effects from new negotiations may not recur. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Associated Press
07-05-2025
- Business
- Associated Press
Kennametal Announces Fiscal 2025 Third Quarter Results
Published [hour]:[minute] [AMPM] [timezone], [monthFull] [day], [year] Earnings per diluted share (EPS) of $0.41 and adjusted EPS of $0.47, compared to $0.24 and $0.30, respectively, in the prior year quarter Returned approximately $40 million to shareholders; $25 million in share repurchases and $15 million in dividends Company provides updated annual Outlook PITTSBURGH, May 7, 2025 /PRNewswire/ -- Kennametal Inc. (NYSE: KMT) (the 'Company') today reported results for its fiscal 2025 third quarter ended March 31, 2025, with sales of $486 million compared to $516 million in the prior year quarter, and earnings per diluted share (EPS) of $0.41 compared to $0.24 in the prior year quarter. The current quarter pre-tax results include a benefit of approximately $10 million from an advanced manufacturing production credit under the Inflation Reduction Act. Adjusted EPS was $0.47 in the current quarter compared to $0.30 in the prior year quarter. 'During the quarter we demonstrated continued progress on our growth and cost initiatives despite weak market conditions, primarily in EMEA and the Americas,' said Sanjay Chowbey, President and CEO. 'The market headwinds resulted in sales slightly below our midpoint while adjusted EPS exceeded the upper end of our outlook primarily due to an advanced manufacturing production credit.' Chowbey continued: 'Like many companies, the recent uncertainty regarding tariff policies has affected Kennametal, however we intend to mitigate the direct effect of tariffs on our business and will pursue new opportunities to take share.' Fiscal 2025 Third Quarter Key Developments Sales of $486 million decreased 6 percent from $516 million in the prior year quarter, reflecting an organic sales decline of 3 percent and an unfavorable currency exchange effect of 3 percent. During the quarter, the Company achieved incremental year-over-year restructuring savings of approximately $6 million. In January 2025, we announced actions to support the long-term competitiveness of the Company and to mitigate softer market conditions. These actions are currently expected to deliver annualized run rate pre-tax savings of approximately $15 million by the end of fiscal 2025. The Company expects to incur pre-tax charges of approximately $25 million in connection with the execution of these actions, of which $6 million was recognized during the quarter. Operating income was $44 million, or 9.1 percent margin, compared to $35 million, or 6.8 percent margin, in the prior year quarter. The increase in operating income was primarily due to an advanced manufacturing production credit under the Inflation Reduction Act of approximately $10 million within the Infrastructure segment, lower raw material costs, pricing, and incremental year-over-year restructuring savings of approximately $6 million. These factors were partially offset by lower sales and production volumes, higher wages and general inflation and an unfavorable currency exchange effect of approximately $3 million. Adjusted operating income was $50 million, or 10.3 percent margin, in the current quarter, compared to $42 million, or 8.1 percent margin, in the prior year quarter. The reported effective tax rate (ETR) for the quarter was 23.6 percent compared to 27.4 percent in the prior year quarter. The decrease in the ETR year-over-year was primarily driven by a benefit from the advanced manufacturing production credit under the Inflation Reduction Act and geographical mix. The adjusted ETR was 22.8 percent in the current quarter, compared to 26.5 percent in the prior year quarter. Year-to-date net cash flow from operating activities was $130 million compared to $163 million in the prior year period. The change in net cash flow from operating activities was driven primarily by working capital changes. Year-to-date free operating cash flow (FOCF) was $63 million compared to $84 million in the prior year period. The decrease in FOCF was driven primarily by working capital changes, partially offset by lower net capital expenditures. The Company paid $15 million in cash dividends to Kennametal shareholders during the quarter. The Company has a long history of consistently paying dividends to shareholders since its listing on the New York Stock Exchange in 1967. During the quarter, the Company repurchased 1.1 million shares of Kennametal common stock for $25 million under its share repurchase program. Inception-to-date the Company has repurchased 2.3 million shares of common stock for $55 million under the $200 million three-year program. Outlook The Company's expectations for the full fiscal year 2025 are as follows: Annual Outlook: Sales now expected to be $1.970 - $1.990 billion Adjusted EPS is now expected to be $1.30 - $1.45 Pricing actions expected to cover raw material costs, wages and general inflation Interest expense is expected to be approximately $27 million Adjusted ETR is now expected to be approximately 25 percent Free operating cash flow of greater than 125 percent of adjusted net income Primary working capital as a percent of sales is now expected to be approximately 32 percent by fiscal year-end Capital spending now expected to be approximately $90 million The Company will provide more details regarding its Outlook, including assumptions on tariffs, during its quarterly earnings conference call. Segment Results Metal Cutting sales of $304 million decreased 7 percent from $327 million in the prior year quarter, reflecting an organic sales decline of 4 percent and an unfavorable currency exchange effect of 3 percent. Operating income was $25 million, or 8.2 percent margin, compared to $31 million, or 9.4 percent margin, in the prior year quarter. The decrease in operating income was primarily due to lower sales and production volumes, an unfavorable currency exchange effect of approximately $3 million and higher wages and general inflation. These factors were partially offset by pricing, incremental year-over-year restructuring savings of approximately $4 million and lower raw material costs. Adjusted operating income was $29 million, or 9.6 percent margin, in the current quarter, compared to $35 million, or 10.8 percent margin, in the prior year quarter. Infrastructure sales of $182 million decreased 4 percent from $189 million in the prior year quarter, reflecting an organic sales decline of 2 percent and an unfavorable currency exchange effect of 2 percent. Operating income was $19 million, or 10.7 percent margin, compared to $5 million, or 2.7 percent margin, in the prior year quarter. The increase in operating income was primarily due to an advanced manufacturing production credit under the Inflation Reduction Act of approximately $10 million, the favorable timing of pricing compared to raw material costs and incremental year-over-year restructuring savings of approximately $2 million. These factors were partially offset by lower sales and production volumes. Adjusted operating income was $21 million, or 11.5 percent margin, in the current quarter, compared to $7 million, or 3.8 percent margin, in the prior year quarter. Dividend Declared Kennametal announced that its Board of Directors declared a quarterly cash dividend of $0.20 per share. The dividend is payable on May 27, 2025 to shareholders of record as of the close of business on May 13, 2025. The Company will host a conference call to discuss its third quarter fiscal 2025 results on Wednesday, May 7, 2025 at 9:30 a.m. Eastern Time. The conference call will be broadcast via real-time audio on Kennametal's investor relations website at - click 'Event' (located in the blue Quarterly Earnings block). This earnings release contains non-GAAP financial measures. Reconciliations and descriptions of all non-GAAP financial measures are set forth in the tables that follow. Certain statements in this release may be forward-looking in nature, or 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements that do not relate strictly to historical or current facts. For example, statements about Kennametal's outlook for sales, interest expense, adjusted EPS, FOCF, primary working capital, capital expenditures and adjusted effective tax rate for the full year of fiscal 2025 and our expectations regarding future growth and financial performance are forward-looking statements. Any forward-looking statements are based on current knowledge, expectations and estimates that involve inherent risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, our actual results could vary materially from our current expectations. There are a number of factors that could cause our actual results to differ from those indicated in the forward-looking statements. They include: uncertainties related to changes in macroeconomic and/or global conditions, including as a result of increased inflation, tariffs, and Russia's invasion of Ukraine and the resulting sanctions on Russia; the conflict in the Middle East; other economic recession; our ability to achieve all anticipated benefits of restructuring, simplification and modernization initiatives; Commercial Excellence growth initiatives, Operational Excellence initiatives, our foreign operations and international markets, such as currency exchange rates, different regulatory environments, trade barriers, exchange controls, and social and political instability, including the conflicts in Ukraine and the Middle East; changes in the regulatory environment in which we operate, including environmental, health and safety regulations; potential for future goodwill and other intangible asset impairment charges; our ability to protect and defend our intellectual property; continuity of information technology infrastructure; competition; our ability to retain our management and employees; demands on management resources; availability and cost of the raw materials we use to manufacture our products; product liability claims; integrating acquisitions and achieving the expected savings and synergies; global or regional catastrophic events; demand for and market acceptance of our products; business divestitures; energy costs; commodity prices; labor relations; and implementation of environmental remediation matters. Many of these risks and other risks are more fully described in Kennametal's latest annual report on Form 10-K and its other periodic filings with the Securities and Exchange Commission. We can give no assurance that any goal or plan set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. We undertake no obligation to release publicly any revisions to forward-looking statements as a result of future events or developments. About Kennametal With over 85 years as an industrial technology leader, Kennametal Inc. delivers productivity to customers through materials science, tooling and wear-resistant solutions. Customers across aerospace and defense, earthworks, energy, general engineering and transportation turn to Kennametal to help them manufacture with precision and efficiency. Every day approximately 8,400 employees are helping customers in nearly 100 countries stay competitive. Kennametal generated $2 billion in revenues in fiscal 2024. Learn more at . Follow @Kennametal: Instagram, Facebook, LinkedIn and YouTube. FINANCIAL HIGHLIGHTS CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) Three Months Ended March 31, Nine Months Ended March 31, (in thousands, except per share amounts) 2025 2024 2025 2024 Sales $ 486,399 $ 515,794 $ 1,450,398 $ 1,503,591 Cost of goods sold 330,034 362,532 997,993 1,047,834 Gross profit 156,365 153,262 452,405 455,757 Operating expense 104,013 108,684 324,975 327,674 Restructuring and other charges, net 5,589 6,465 7,535 10,585 Amortization of intangibles 2,703 2,886 8,142 8,674 Operating income 44,060 35,227 111,753 108,824 Interest expense 6,213 6,777 18,705 20,225 Other income, net (5,454) (76) (8,589) (674) Income before income taxes 43,301 28,526 101,637 89,273 Provision for income taxes 10,219 7,816 26,052 13,866 Net income 33,082 20,710 75,585 75,407 Less: Net income attributable to noncontrolling interests 1,600 1,734 4,052 3,266 Net income attributable to Kennametal $ 31,482 $ 18,976 $ 71,533 $ 72,141 PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREHOLDERS Basic earnings per share $ 0.41 $ 0.24 $ 0.92 $ 0.91 Diluted earnings per share $ 0.41 $ 0.24 $ 0.91 $ 0.90 Basic weighted average shares outstanding 77,037 79,229 77,614 79,655 Diluted weighted average shares outstanding 77,651 79,849 78,208 80,197 CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) March 31, 2025 June 30, 2024 ASSETS Cash and cash equivalents $ 97,467 $ 127,971 Accounts receivable, net 290,944 302,810 Inventories 555,989 514,632 Other current assets 68,960 57,179 Total current assets 1,013,360 1,002,592 Property, plant and equipment, net 911,867 938,063 Goodwill and other intangible assets, net 346,205 352,988 Other assets 219,071 210,115 Total assets $ 2,490,503 $ 2,503,758 LIABILITIES Revolving and other lines of credit and notes payable $ 12,561 $ 1,377 Accounts payable 192,923 191,541 Other current liabilities 210,142 223,043 Total current liabilities 415,626 415,961 Long-term debt 596,586 595,980 Other liabilities 199,375 203,218 Total liabilities 1,211,587 1,215,159 KENNAMETAL SHAREHOLDERS' EQUITY 1,236,868 1,249,875 NONCONTROLLING INTERESTS 42,048 38,724 Total liabilities and equity $ 2,490,503 $ 2,503,758 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) Nine Months Ended March 31, (in thousands) 2025 2024 OPERATING ACTIVITIES Net income $ 75,585 $ 75,407 Adjustments to reconcile to cash from operations: Depreciation 93,279 91,056 Amortization 8,142 8,674 Stock-based compensation expense 18,329 20,651 Restructuring and other charges, net 7,535 10,585 Deferred income taxes (1,917) (7,661) Gain on insurance recoveries (7,500) — Other 817 13,511 Changes in certain assets and liabilities: Accounts receivable 10,516 3,875 Inventories (41,269) 7,044 Accounts payable and accrued liabilities (14,140) (26,014) Accrued income taxes (11,668) (17,459) Accrued pension and postretirement benefits (5,023) (8,529) Other (2,956) (7,680) Net cash flow provided by operating activities 129,730 163,460 INVESTING ACTIVITIES Purchases of property, plant and equipment (67,506) (84,240) Disposals of property, plant and equipment 460 5,270 Business acquisitions — (4,010) Proceeds from insurance recoveries 7,193 — Other (202) (3,131) Net cash flow used in investing activities (60,055) (86,111) FINANCING ACTIVITIES Net increase in notes payable 944 4,132 Net increase in revolving and other lines of credit 10,200 7,500 Purchase of capital stock (55,081) (43,786) The effect of employee benefit and stock plans and dividend reinvestment (6,570) (7,949) Cash dividends paid to Shareholders (46,604) (47,697) Other (915) (859) Net cash flow used in financing activities (98,026) (88,659) Effect of exchange rate changes on cash and cash equivalents (2,153) (2,592) CASH AND CASH EQUIVALENTS Net decrease in cash and cash equivalents (30,504) (13,902) Cash and cash equivalents, beginning of period 127,971 106,021 Cash and cash equivalents, end of period $ 97,467 $ 92,119 SEGMENT DATA (UNAUDITED) Three Months Ended March 31, Nine Months Ended March 31, (in thousands) 2025 2024 2025 2024 Sales: Metal Cutting $ 304,349 $ 326,561 $ 899,035 $ 946,237 Infrastructure 182,050 189,233 551,363 557,354 Total sales $ 486,399 $ 515,794 $ 1,450,398 $ 1,503,591 Sales By Geographic Region: Americas $ 240,361 $ 252,921 $ 713,341 $ 738,566 EMEA 151,262 164,238 442,689 465,874 Asia Pacific 94,776 98,635 294,368 299,151 Total sales $ 486,399 $ 515,794 $ 1,450,398 $ 1,503,591 Operating income: Metal Cutting $ 24,900 $ 30,809 $ 65,308 $ 88,453 Infrastructure 19,423 5,140 47,770 22,020 Corporate (1) (263) (722) (1,325) (1,649) Total operating income $ 44,060 $ 35,227 $ 111,753 $ 108,824 (1) Represents unallocated corporate expenses. NON-GAAP RECONCILIATIONS (UNAUDITED) In addition to reported results under generally accepted accounting principles in the United States of America (GAAP), the following financial highlight tables include, where appropriate, a reconciliation of adjusted results including: operating income and margin; ETR; net income attributable to Kennametal; diluted EPS; Metal Cutting operating income and margin; Infrastructure operating income and margin; FOCF; and consolidated and segment organic sales growth (all of which are non-GAAP financial measures), to the most directly comparable GAAP financial measures. Adjustments for the three months ended March 31, 2025 include restructuring and related charges and differences in projected annual tax rates. Adjustments for the three months ended March 31, 2024 include restructuring and related charges and differences in projected annual tax rates. For those adjustments that are presented 'net of tax', the tax effect of the adjustment can be derived by calculating the difference between the pre-tax and the post-tax adjustments presented. The tax effect on adjustments is calculated by preparing an overall tax calculation including the adjustments and then a tax calculation excluding the adjustments. The difference between these calculations results in the tax impact of the adjustments. Management believes that presentation of these non-GAAP financial measures provides useful information about the results of operations of the Company for the current and past periods. Management believes that investors should have available the same information that management uses to assess operating performance, determine compensation and assess the capital structure of the Company. These non-GAAP financial measures should not be considered in isolation or as a substitute for the most comparable GAAP financial measures. Investors are cautioned that non-GAAP financial measures used by management may not be comparable to non-GAAP financial measures used by other companies. Reconciliations and descriptions of all non-GAAP financial measures are set forth in the disclosures below. Reconciliations to the most directly comparable GAAP financial measures for the following forward-looking non-GAAP financial measures for the full fiscal year of 2025 have not been provided, including but not limited to: FOCF, adjusted operating income, adjusted net income, adjusted EPS, adjusted ETR and primary working capital. The most comparable GAAP financial measures are net cash flow from operating activities, operating income, net income attributable to Kennametal, EPS, ETR and working capital (defined as current assets less current liabilities), respectively. Primary working capital is defined as accounts receivable, net plus inventories, net minus accounts payable. Because the non-GAAP financial measures on a forward-looking basis are subject to uncertainty and variability as they are dependent on many factors - including, but not limited to, the effect of foreign currency exchange fluctuations, impacts from potential acquisitions or divestitures, gains or losses on the potential sale of businesses or other assets, restructuring costs, asset impairment charges, gains or losses from early extinguishment of debt, the tax impact of the items above and the impact of tax law changes or other tax matters - reconciliations to the most directly comparable forward-looking GAAP financial measures are not available without unreasonable effort. THREE MONTHS ENDED MARCH 31, 2025 (UNAUDITED) (in thousands, except percents and per share data) Sales Operating income ETR Net income(2) Diluted EPS Reported results $ 486,399 $ 44,060 23.6 % $ 31,482 $ 0.41 Reported operating margin 9.1 % Restructuring and related charges — 5,840 19.4 4,709 0.06 Differences in projected annual tax rates — — (20.2) 146 — Adjusted results $ 486,399 $ 49,900 22.8 % $ 36,337 $ 0.47 Adjusted operating margin 10.3 % (2) Attributable to Kennametal. THREE MONTHS ENDED MARCH 31, 2025 (UNAUDITED) Metal Cutting Infrastructure (in thousands, except percents) Sales Operating income Sales Operating income Reported results $ 304,349 $ 24,900 $ 182,050 $ 19,423 Reported operating margin 8.2 % 10.7 % Restructuring and related charges — 4,320 — 1,520 Adjusted results $ 304,349 $ 29,220 $ 182,050 $ 20,943 Adjusted operating margin 9.6 % 11.5 % THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED) (in thousands, except percents and per share data) Sales Operating income ETR Net income(2) Diluted EPS Reported results $ 515,794 $ 35,227 27.4 % $ 18,976 $ 0.24 Reported operating margin 6.8 % Restructuring and related charges — 6,465 20.4 5,098 0.06 Differences in projected annual tax rates — — (21.3) (141) — Adjusted results $ 515,794 $ 41,692 26.5 % $ 23,933 $ 0.30 Adjusted operating margin 8.1 % (2) Attributable to Kennametal. THREE MONTHS ENDED MARCH 31, 2024 (UNAUDITED) Metal Cutting Infrastructure (in thousands, except percents) Sales Operating income Sales Operating income Reported results $ 326,561 $ 30,809 $ 189,233 $ 5,140 Reported operating margin 9.4 % 2.7 % Restructuring and related charges — 4,493 — 1,972 Adjusted results $ 326,561 $ 35,302 $ 189,233 $ 7,112 Adjusted operating margin 10.8 % 3.8 % Free Operating Cash Flow (FOCF) FOCF is a non-GAAP financial measure and is defined by the Company as net cash flow provided by operating activities (which is the most directly comparable GAAP financial measure) less capital expenditures plus proceeds from disposals of fixed assets. Management considers FOCF to be an important indicator of the Company's cash generating capability because it better represents cash generated from operations that can be used for dividends, debt repayment, strategic initiatives (such as acquisitions) and other investing and financing activities. FREE OPERATING CASH FLOW (UNAUDITED) Nine Months Ended March 31, (in thousands) 2025 2024 Net cash flow provided by operating activities $ 129,730 $ 163,460 Purchases of property, plant and equipment (67,506) (84,240) Disposals of property, plant and equipment 460 5,270 Free operating cash flow $ 62,684 $ 84,490 Organic Sales Growth (Decline) Organic sales growth (decline) is a non-GAAP financial measure of sales growth (decline) (which is the most directly comparable GAAP measure) excluding the effects of acquisitions, divestitures, business days and foreign currency exchange from year-over-year comparisons. Management believes this measure provides investors with a supplemental understanding of underlying sales trends by providing sales growth on a consistent basis. Management reports organic sales growth (decline) at the consolidated and segment levels. ORGANIC SALES DECLINE (UNAUDITED) Three Months Ended March 31, 2025 Metal Cutting Infrastructure Total Organic sales decline (4) % (2) % (3) % Foreign currency exchange effect (3) (3) (2) (3) Business days effect (4) — — — Sales decline (7) % (4) % (6) % (3) Foreign currency exchange effect is calculated by dividing the difference between current period sales and current period sales at prior period foreign exchange rates by prior period sales. (4) Business days effect is calculated by dividing the year-over-year change in weighted average working days (based on mix of sales by country) by prior period weighted average working days. View original content: SOURCE Kennametal Inc.
