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Powell also emphasized the target’s “near-net-shaped” manufacturing capabilities, which he said reduce downstream machining and processing and can lower total production costs. In the Q&A, management described BÖHLER’s competitive advantages as stemming from patented processing lines the company developed and built itself, enabling production that is closer to a final component shape and, in some cases, requires “almost nothing” in post-processing.A key attribute for Kadant is that 100% of BÖHLER Profil’s b ...

PresentationI would now like to hand the conference over to your speaker today, Michael McKenney, Executive Vice President and Chief Financial Officer. Please go ahead.Good day, and thank you for standing by. Welcome to the Kadant to acquire Voestalpine BOHLER Profil Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.Michael McKenneyExecutive VP & CFO Thank you, Shannon. Good morning, everyone. Welcome to Kadant's conference call to discuss its proposed acqu ...

Summary of Kadant's Acquisition of voestalpine BÖHLER Profil Conference Call Company and Industry - **Company**: Kadant (NYSE: KAI) - **Acquisition Target**: voestalpine BÖHLER Profil - **Industry**: Manufacturing of precision components for technically challenging applications Core Points and Arguments - **Acquisition Announcement**: Kadant announced the acquisition of voestalpine BÖHLER Profil, a company with over 150 years of history, located in Bruckbach, Austria, with a revenue of EUR 51.5 million for fiscal year 2025 [4][43]. - **Strategic Fit**: BÖHLER Profil has been a supplier to Kadant for over 30 years, providing critical components for wood processing and turbine engines. The acquisition aligns with Kadant's strategic focus on parts and consumables, which constitutes 100% of BÖHLER's business [5][44]. - **Purchase Price**: The acquisition is valued at approximately EUR 157 million, with an EBITDA multiple of about 10x, adjusted to approximately 8.5x when considering beneficial tax attributes [6][48]. - **Intercompany Revenue**: Post-acquisition, revenue from Kadant's businesses will be classified as intercompany revenue, which will not be included in Kadant's reported revenue. This will initially reduce reported revenue but is expected to enhance gross and EBITDA margins over time [7][46]. - **Dilution Impact**: The acquisition is expected to be dilutive in 2026 due to the need to work through existing inventory purchased before the acquisition closes. This process may take several quarters [8][55]. Financial Metrics - **Revenue and EBITDA**: BÖHLER Profil generated approximately EUR 52 million in revenue for the fiscal year ending March 31, 2025, with an adjusted EBITDA of EUR 15.6 million [6][48]. - **Leverage Ratio**: Kadant anticipates its leverage ratio will increase to just above 2 after the acquisition, with a borrowing rate of approximately 3.5% for the new debt in 2026 [9][48]. Additional Insights - **Market Opportunities**: Kadant plans to leverage BÖHLER's specialized manufacturing processes and patented technologies to expand market share both within and outside Kadant's existing operations [18][56]. - **Customer Base**: BÖHLER Profil serves a diverse customer base across various industries, including aviation, automotive, and industrial machinery, with historical growth rates of around 8% to 10% over the past five years [34][74]. - **Competitive Advantage**: BÖHLER's patented near-net-shaping technology significantly reduces machining time and costs, providing a competitive edge in the manufacturing of critical components [25][64]. Conclusion - The acquisition of voestalpine BÖHLER Profil is a strategic move for Kadant, enhancing its capabilities in parts and consumables while providing opportunities for growth and improved margins. The integration process will be closely monitored, particularly regarding the management of intercompany revenues and inventory turnover.

Acquisition of voestalpine BÖHLER Profil February 3, 2026 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 the financial and operating performance of voestalpine BÖHLER Profil, the benefits of the proposed acquisition of voestalpine BÖHLER Profil (the "Acquisition"), the pro ...

WESTFORD, Mass., Jan. 29, 2026 (GLOBE NEWSWIRE) -- Kadant Inc. (NYSE: KAI) has entered into a definitive agreement to acquire voestalpine BÖHLER Profil GmbH & Co KG (“voestalpine BÖHLER Profil”). The acquisition is expected to close in the first quarter of 2026, subject to certain Austrian regulatory approvals and the satisfaction of customary closing conditions, and will be financed primarily through borrowings under Kadant’s revolving credit facility. With over 150 years of experience, voestalpine BÖHLER ...

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Financial Data and Key Metrics Changes - Q3 2025 revenue was $271.6 million, flat compared to the prior year, with record aftermarket parts revenue of $188.4 million, up 6% year-over-year [6][12] - Adjusted EBITDA was $58 million, with an adjusted EBITDA margin of 21.4% [6][19] - GAAP EPS decreased 12% to $2.35, while adjusted EPS decreased 9% to $2.59, exceeding guidance by $0.36 due to higher-than-expected aftermarket parts revenue [18][19] - Gross margin improved to 45.2%, up 50 basis points from 44.7% in Q3 2024 [12][16] Business Line Data and Key Metrics Changes - Flow control segment revenue declined 3% to $94 million, with aftermarket parts revenue up 5% [7][8] - Industrial processing segment revenue decreased 4% to $106 million, with aftermarket parts revenue at a record $81 million, representing 76% of total revenue [8][9] - Material handling segment revenue increased 11% to a record $70 million, driven by an 18% increase in capital shipments [9][10] Market Data and Key Metrics Changes - Market demand for capital equipment remains sluggish, but there is increasing activity expected in Q4 2025 [5][10] - Capital bookings were flat compared to the previous year, primarily due to sustained weakness in capital project orders [7][24] - Operating rates in the U.S. are higher than in other regions, with paper side rates around low 80% and China at 60% [45][46] Company Strategy and Development Direction - The company is focusing on operational improvements and strategic acquisitions, including Clyde Industries and Babbini [22][25] - The acquisition strategy is supported by a renewed revolving credit facility, increasing borrowing capacity to $750 million [22] - The company anticipates a healthy aftermarket demand and improved business activity moving forward [10][25] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about capital orders moving forward, despite delays in bookings due to administrative processes [31][32] - The impact of tariffs is still present, creating uncertainty, but conditions are improving compared to earlier in the year [34][35] - The second half of 2025 is expected to show solid improvement across various metrics, with strong aftermarket parts activity anticipated [89] Other Important Information - Cash flow from operations was $47 million, and free cash flow was $44 million in Q3 2025 [6][19] - The company is monitoring tariff impacts and exploring alternative suppliers to mitigate costs [24] - The backlog at the end of Q3 was $273 million, with capital orders making up about 60% of that [73] Q&A Session Summary Question: Percentage of aftermarket parts revenue for each segment - Flow control: 74% current quarter vs. 70% prior year; Industrial processing: 76% current vs. 67% prior; Material handling: 52% current vs. 55% prior [29] Question: Clarification on capital bookings being pushed to 2026 - Management noted several projects are in late stages, but administrative requirements may delay bookings [31][32] Question: Impact of tariffs on capital equipment needs - Management indicated that while conditions are better, uncertainty remains, affecting customer caution [34][35] Question: Insights on factory utilization rates globally - U.S. operating rates are higher than global averages, with paper side at low 80% and China at 60% [45][46] Question: Backlog contribution from Clyde Industries - Expected backlog contribution from Clyde Industries is around $30 million [75]

Financial Performance - The company reported Q3 revenue of $272 million, flat compared to the prior year, with record aftermarket parts revenue up 6% to $188.4 million [6][12][17] - Adjusted EBITDA was $58 million with a margin of 21.4%, while GAAP EPS decreased 12% to $2.35 and adjusted EPS decreased 9% to $2.59 [6][17][18] - Cash flow from operations was $47 million and free cash flow was $44 million, demonstrating strong business model resilience [6][18] Business Segment Performance - Flow control segment revenue decreased 3% to $94 million, with aftermarket parts revenue up 5% [7][8] - Industrial processing segment revenue decreased 4% to $106 million, with aftermarket parts revenue at a record $81 million, representing 76% of total revenue [8][9] - Material handling segment revenue increased 11% to a record $70 million, driven by an 18% increase in capital shipments [9][10] Market Conditions - Market demand for capital equipment remains sluggish, but there is increasing activity anticipated in Q4 [5][10] - Capital project orders have been delayed, with many expected to push into 2026 due to administrative processes [23][30] Company Strategy and Industry Competition - The company is focused on enhancing operational efficiencies through initiatives like the 80/20 performance enhancement program [88] - Recent acquisitions, including Clyde Industries, are expected to contribute positively to future revenue and operational capabilities [9][24][88] Management Commentary - Management expressed optimism about future capital orders, despite current delays, and noted that economic headwinds are still a concern [7][30] - The company is monitoring tariff impacts and is actively seeking alternative suppliers to mitigate cost pressures [23][24] Other Important Information - The company increased its full-year revenue guidance to $1.036 billion to $1.046 billion, reflecting the impact of recent acquisitions [24] - SG&A expenses as a percentage of revenue increased to 27.9% in Q3, attributed to various factors including acquisition-related costs [16][17] Q&A Session Summary Question: What is the percentage of aftermarket parts revenue for each segment? - Flow control: 74% current quarter vs. 70% prior year; Industrial processing: 76% vs. 67%; Material handling: 52% vs. 55% [28] Question: Can you clarify the situation with capital bookings being pushed to 2026? - Management indicated that several projects are in late stages but may not be booked until administrative requirements are met [30] Question: How are tariffs affecting capital equipment demand? - Management noted that while conditions have improved, uncertainty remains, impacting customer decision-making [33][34] Question: What is the expected contribution from recent acquisitions? - Clyde Industries and Babini are anticipated to contribute approximately $23 to $25 million in revenue combined for Q4 [57] Question: What is the backlog status? - The company ended Q3 with a backlog of $273 million, with capital orders making up about 60% of that [72]

Financial Data and Key Metrics Changes - The company's Q3 revenue was flat year-over-year at $272 million, benefiting from record aftermarket parts revenue, which increased by 6% compared to the same period last year [6][13] - Adjusted EBITDA for Q3 was $58 million, with an adjusted EBITDA margin of 21.4% [6] - GAAP EPS decreased by 12% to $2.35, while adjusted EPS decreased by 9% to $2.59, exceeding the high end of guidance by $0.36 due to higher-than-expected aftermarket parts revenue [19][20] Business Line Data and Key Metrics Changes - In the flow control segment, revenue declined by 3% year-over-year, but new order activity increased by 5% [8] - The industrial processing segment saw a 4% decrease in revenue to $106 million, with aftermarket parts revenue reaching a record $81 million, representing 76% of total Q3 revenue [9] - The material handling segment achieved record revenue of $70 million, up 11% year-over-year, driven by an 18% increase in capital shipments [10] Market Data and Key Metrics Changes - Market demand for capital equipment remains sluggish, but there is increasing activity anticipated in early Q4 [5] - Capital bookings were below expectations due to weak market conditions in the pulp and paper industry, particularly affecting the industrial processing segment [25] Company Strategy and Development Direction - The company is focusing on its aftermarket parts business as a core strategic area, which has shown resilience during economic headwinds [5] - Recent acquisitions, including Clyde Industries, are expected to enhance operational capabilities and contribute to revenue growth in the upcoming quarters [10][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about capital orders moving forward, despite delays in booking due to administrative processes [31] - The company anticipates solid improvement in the second half of 2025, with expectations for increased demand for capital equipment and strong aftermarket parts activity [70] Other Important Information - The company renewed its revolving credit facility, increasing borrowing capacity from $400 million to $750 million, which supports its acquisition strategy [23] - Cash flow from operations and free cash flow for Q3 were $47 million and $44 million, respectively, indicating strong business model performance [20] Q&A Session Summary Question: Percentage of aftermarket parts revenue for segments - Flow control segment: 74% this quarter vs. 70% last year; industrial processing: 76% vs. 67%; material handling: 52% vs. 55% [29] Question: Clarification on capital bookings and demand - Management noted that several projects are in late stages, but administrative requirements may delay bookings into 2026 [31] Question: Impact of tariffs on sales and capital equipment needs - While conditions have improved, uncertainty remains, and clients are gradually adapting to the new environment [33] Question: Backlog and capital equipment orders - The backlog at the end of Q3 was $273 million, with capital orders making up about 60% [59][60] Question: Contribution from recent acquisitions - Expected revenue contribution from Clyde Industries and Babini is in the range of $23 to $25 million combined for Q4 [49]