Core Viewpoint - Kennametal Inc. reported strong adjusted earnings for Q3 fiscal 2025, significantly exceeding expectations, despite a decline in revenues year-over-year [1][2]. Revenue Performance - Total revenues for Kennametal were $486.4 million, a decrease of 5.7% from the previous year, and missed the Zacks Consensus Estimate of $490 million [2]. - Revenue breakdown by region showed a 3% decline in American operations to $240.4 million, a 4% decrease in Europe, the Middle East, and Africa to $151.3 million, and a 1% drop in Asia Pacific to $94.8 million [2]. - The Metal Cutting segment generated revenues of $304.3 million, down 7% year-over-year, with organic revenues declining 4% [3]. - The Infrastructure segment reported revenues of $182.1 million, a 4% decrease year-over-year, with organic revenues down 2% [4]. Margin and Cost Analysis - Cost of goods sold decreased by 9% year-over-year to $330 million, leading to a gross profit increase of 2% to $156.4 million and a gross margin improvement of 250 basis points to 32.2% [5]. - Operating income rose 25.7% year-over-year to $44.1 million, with an operating margin increase of 230 basis points to 9.1% [5]. - Interest expenses were reported at $6.2 million, down 8.3% from the previous year [6]. Balance Sheet and Cash Flow - As of the end of Q3, cash and cash equivalents stood at $97.5 million, down from $128 million in the previous quarter, while long-term debt increased slightly to $596.6 million [7]. - In the first nine months of fiscal 2025, net cash generated from operating activities was $129.7 million, compared to $163.5 million in the same period last year [8]. - Free operating cash flow was reported at $63 million, down from $84 million in the previous fiscal year [8]. Dividend and Share Repurchase - The company declared a quarterly cash dividend of 20 cents per share, with a total payout of $46.6 million, and repurchased shares worth $55.1 million [9][11]. Guidance - Kennametal updated its fiscal 2025 outlook, projecting sales between $1.97 billion and $1.99 billion, and adjusted earnings per share in the range of $1.30 to $1.45 [12]. - Free operating cash flow is expected to exceed 125% of net income, with capital spending anticipated at approximately $90 million [12].

Company Overview - Kennametal Inc. is an industrial technology leader with over 85 years of experience, focusing on materials science, tooling, and wear-resistant solutions [1] - The company serves various sectors including aerospace and defense, earthworks, energy, general engineering, and transportation, helping customers manufacture with precision and efficiency [1] - Kennametal employs approximately 8,400 individuals across nearly 100 countries [1] Financial Performance - In fiscal 2024, Kennametal generated revenues of $2 billion [1] Upcoming Events - Kennametal will attend the KeyBanc Capital Markets Industrials & Basic Materials Conference in Boston, MA on May 28, 2025 [1] - Key attendees from Kennametal include Patrick Watson (Vice President and CFO), Michael Pici (Vice President, Investor Relations), and John Witt (Vice President Finance and Corporate Controller) [1]

[PART I - FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed consolidated financial statements, management's discussion and analysis, and disclosures on market risk and internal controls for the period ended March 31, 2025 [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for the three and nine months ended March 31, 2025, and 2024, including Statements of Income, Comprehensive Income, Balance Sheets, and Cash Flows, along with detailed notes [Condensed Consolidated Statements of Income (Unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20%28Unaudited%29) For the third quarter of fiscal 2025, sales decreased to $486.4 million from $515.8 million year-over-year, while net income attributable to Kennametal increased significantly to $31.5 million from $19.0 million, resulting in diluted EPS rising to $0.41 from $0.24 Q3 & Nine Months FY2025 vs FY2024 Income Statement Highlights | Metric (in thousands, except per share) | Q3 2025 | Q3 2024 | Change | 9 Months 2025 | 9 Months 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Sales | $486,399 | $515,794 | -5.7% | $1,450,398 | $1,503,591 | -3.5% | | Gross Profit | $156,365 | $153,262 | +2.0% | $452,405 | $455,757 | -0.7% | | Operating Income | $44,060 | $35,227 | +25.1% | $111,753 | $108,824 | +2.7% | | Net Income Attributable to Kennametal | $31,482 | $18,976 | +65.9% | $71,533 | $72,141 | -0.8% | | Diluted EPS | $0.41 | $0.24 | +70.8% | $0.91 | $0.90 | +1.1% | [Condensed Consolidated Balance Sheets (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28Unaudited%29) As of March 31, 2025, total assets were $2.49 billion, a slight decrease from $2.50 billion at June 30, 2024, with total liabilities also seeing a minor decrease to $1.21 billion and Kennametal Shareholders' Equity decreasing to $1.24 billion Balance Sheet Highlights | Metric (in thousands) | March 31, 2025 | June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $97,467 | $127,971 | -23.8% | | Inventories | $555,989 | $514,632 | +8.0% | | Total current assets | $1,013,360 | $1,002,592 | +1.1% | | Total assets | $2,490,503 | $2,503,758 | -0.5% | | Total liabilities | $1,211,587 | $1,215,159 | -0.3% | | Total Kennametal Shareholders' Equity | $1,236,868 | $1,249,875 | -1.0% | [Condensed Consolidated Statements of Cash Flow (Unaudited)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flow%20%28Unaudited%29) For the nine months ended March 31, 2025, net cash from operating activities was $129.7 million, a decrease from $163.5 million in the prior year, mainly due to a significant increase in inventories, while investing and financing activities used $60.1 million and $98.0 million respectively Nine Months Ended Cash Flow Summary | Cash Flow Activity (in thousands) | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash flow provided by operating activities | $129,730 | $163,460 | | Net cash flow used in investing activities | ($60,055) | ($86,111) | | Net cash flow used in financing activities | ($98,026) | ($88,659) | | Net decrease in cash and cash equivalents | ($30,504) | ($13,902) | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) The notes provide detailed explanations for the financial statements, including information on restructuring charges, segment data, and a new legal proceeding initiated against the company seeking over $330 million in damages - In January 2025, the company announced new restructuring actions expected to incur pre-tax charges of approximately **$25 million**[32](index=32&type=chunk) - A lawsuit was filed against the company in February 2025 by MachiningCloud, Inc. for breach of contract, seeking more than **$330 million** in damages, which the company intends to vigorously defend[60](index=60&type=chunk) Segment Operating Income (Q3 2025 vs Q3 2024) | Segment (in thousands) | Q3 2025 | Q3 2024 | | :--- | :--- | :--- | | Metal Cutting | $24,900 | $30,809 | | Infrastructure | $19,423 | $5,140 | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a 6% year-over-year sales decrease for Q3 2025 to $486.4 million, driven by organic decline and unfavorable currency effects, while operating income increased due to an advanced manufacturing production credit, lower raw material costs, and restructuring savings - Q3 2025 sales decreased **6%** from the prior year quarter to **$486.4 million**, reflecting a **3%** organic sales decline and a **3%** unfavorable currency exchange effect[69](index=69&type=chunk) - Q3 2025 operating income increased by **$8.8 million** year-over-year, primarily due to a **~$10 million** advanced manufacturing production credit (Inflation Reduction Act), lower raw material costs, and **~$6 million** in restructuring savings[70](index=70&type=chunk) - The company estimates a potential annual exposure of approximately **$80 million** related to additional tariffs and is working to mitigate negative impacts[72](index=72&type=chunk) [Results of Operations](index=24&type=section&id=RESULTS%20OF%20CONTINUING%20OPERATIONS) For Q3 2025, sales decreased 6% year-over-year, with an organic decline of 3%, while gross profit margin improved to 32.1% from 29.7% due to an advanced manufacturing production credit and lower raw material costs, also impacting the effective tax rate End Market Sales Growth (Decline) - Q3 2025 vs Q3 2024 | End Market | As Reported | Constant Currency | | :--- | :--- | :--- | | Aerospace & Defense | 4% | 7% | | Energy | (3)% | (1)% | | General Engineering | (8)% | (5)% | | Transportation | (6)% | (2)% | | Earthworks | (8)% | (7)% | - Gross profit margin for Q3 2025 was **32.1%**, compared to **29.7%** in the prior year quarter, boosted by a **~$10 million** advanced manufacturing production credit[77](index=77&type=chunk) - The effective tax rate for Q3 2025 was **23.6%**, down from **27.4%** in Q3 2024, primarily due to the benefit from the advanced manufacturing production credit[85](index=85&type=chunk) [Business Segment Review](index=25&type=section&id=BUSINESS%20SEGMENT%20REVIEW) In Q3 2025, the Metal Cutting segment's sales fell 7% to $304.3 million, with operating income decreasing to $24.9 million, while the Infrastructure segment's sales decreased 4% to $182.1 million but its operating income surged to $19.4 million from $5.1 million year-over-year, primarily due to an advanced manufacturing production credit Segment Performance - Q3 2025 vs Q3 2024 | Segment (in thousands) | Sales Q3 2025 | Sales Q3 2024 | Operating Income Q3 2025 | Operating Income Q3 2024 | | :--- | :--- | :--- | :--- | :--- | | Metal Cutting | $304,349 | $326,561 | $24,900 | $30,809 | | Infrastructure | $182,050 | $189,233 | $19,423 | $5,140 | - Metal Cutting Q3 operating income decreased due to lower sales volumes, unfavorable currency effects, and inflation, partially offset by pricing and restructuring savings[92](index=92&type=chunk) - Infrastructure Q3 operating income surged primarily due to a **~$10 million** advanced manufacturing production credit, favorable pricing-to-raw material cost timing, and restructuring savings[99](index=99&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) As of March 31, 2025, the company maintained a solid liquidity position with $97.5 million in cash and $689.8 million available under its $700 million credit facility, with operating cash flow for the first nine months of fiscal 2025 decreasing to $129.7 million primarily due to higher inventory levels - As of March 31, 2025, the company was in compliance with all credit agreement covenants and had **$689.8 million** of additional availability under its revolving credit facility[107](index=107&type=chunk) - During the nine months ended March 31, 2025, the company repurchased **$55 million** of its common stock under a **$200 million** three-year program authorized in February 2024[110](index=110&type=chunk) - Cash flow from operating activities decreased to **$129.7 million** for the nine months ended March 31, 2025, from **$163.5 million** in the prior year period, largely due to a **$41.3 million** increase in inventories[112](index=112&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company states that there have been no material changes to its market risk exposures since the end of the previous fiscal year, June 30, 2024 - There have been no material changes to our market risk exposures since June 30, 2024[129](index=129&type=chunk) [Controls and Procedures](index=37&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation, the CEO and CFO concluded that the Company's disclosure controls and procedures are effective to provide reasonable assurance as of March 31, 2025[130](index=130&type=chunk) - There were no changes in the Company's internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[131](index=131&type=chunk) [Other Information](index=37&type=section&id=ITEM%205.%20OTHER%20INFORMATION) The company reports that none of its directors or officers adopted, modified, or terminated a Rule 10b5-1 trading plan or a non-Rule 10b5-1 trading arrangement for the purchase or sale of company securities during the quarter ended March 31, 2025 - In the quarter ended March 31, 2025, none of the company's directors or officers adopted, modified or terminated a Rule 10b5-1 trading arrangement[132](index=132&type=chunk) [PART II - OTHER INFORMATION](index=38&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) This section details legal proceedings, equity security transactions, and a list of exhibits filed with the report [Legal Proceedings](index=38&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is party to various legal claims that arise in the ordinary course of business, and while the ultimate outcome is uncertain, management does not currently believe these proceedings will materially affect its financial position, with a significant new lawsuit from MachiningCloud, Inc. seeking over $330 million disclosed in the Notes to Condensed Consolidated Financial Statements - The company is party to legal claims and proceedings that arise in the ordinary course of business[134](index=134&type=chunk) - This section refers to the Notes to Condensed Consolidated Financial Statements for further information, which includes details on a lawsuit from MachiningCloud, Inc. seeking over **$330 million** in damages[134](index=134&type=chunk)[60](index=60&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=38&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%2C%20USE%20OF%20PROCEEDS%2C%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) During the quarter ended March 31, 2025, the company repurchased a total of 1,146,780 shares at an average price of $22.01 per share, with approximately $145 million remaining available for repurchase under the current program authorized in February 2024 Issuer Purchases of Equity Securities (Q3 2025) | Period | Total Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Publicly Announced Program | | :--- | :--- | :--- | :--- | | January 2025 | 6,445 | $24.01 | — | | February 2025 | 582,895 | $22.33 | 580,000 | | March 2025 | 557,440 | $21.66 | 555,364 | | **Total** | **1,146,780** | **$22.01** | **1,135,364** | - As of March 31, 2025, approximately **$145 million** remained available for repurchase under the **$200 million**, three-year share repurchase program[135](index=135&type=chunk) [Exhibits](index=39&type=section&id=ITEM%206.%20EXHIBITS) This section lists the exhibits filed with the 10-Q report, including CEO and CFO certifications and XBRL interactive data files - Lists filed exhibits, including CEO/CFO certifications (**31.1**, **31.2**, **32.1**) and XBRL data files (**101** series)[138](index=138&type=chunk)

Core Insights - Kennametal reported revenue of $486.4 million for the quarter ended March 2025, a year-over-year decline of 5.7% [1] - The EPS for the same period was $0.47, compared to $0.30 a year ago, indicating a significant increase [1] - The reported revenue fell short of the Zacks Consensus Estimate of $490.31 million, resulting in a surprise of -0.80% [1] - The company delivered an EPS surprise of +80.77%, with the consensus EPS estimate being $0.26 [1] Performance Metrics - Total Sales in the Infrastructure segment were $182.05 million, slightly below the average estimate of $183.52 million, reflecting a year-over-year change of -3.8% [4] - Total Sales in the Metal Cutting segment were $304.35 million, compared to the average estimate of $307.12 million, representing a year-over-year decline of -6.8% [4] - Operating Income (loss) for Corporate was -$0.26 million, better than the average estimate of -$0.69 million [4] - Proforma Operating Income for Infrastructure was $20.94 million, exceeding the average estimate of $12.93 million [4] - Proforma Operating Income for Metal Cutting was $29.22 million, surpassing the average estimate of $23.01 million [4] Stock Performance - Kennametal shares have returned +13% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Financial Data and Key Metrics Changes - Sales decreased by 6% year over year, with metal cutting sales declining 4% organically and infrastructure declining 2% organically [9][25] - Adjusted EPS increased to $0.47 compared to $0.30 in the prior year quarter, driven by restructuring benefits and an advanced manufacturing tax credit [12][28] - Adjusted EBITDA and operating margins were 17.9% and 10.3% respectively, compared to 14.2% and 8.1% in the prior year quarter [27] Business Line Data and Key Metrics Changes - Metal cutting sales were down 7% year over year, with a 4% organic decline and unfavorable foreign currency exchange of 3% [29] - Infrastructure sales declined 4% year over year, with an organic decline of 2% and unfavorable foreign currency exchange of 2% [32] - Aerospace and defense sales increased by 28%, while energy declined by 3% mainly in The Americas [33] Market Data and Key Metrics Changes - EMEA remained the slowest market, down 4% on a constant currency basis [9] - Transportation and general engineering were impacted by market conditions in EMEA and The Americas [11] - Earthworks within the infrastructure segment was affected by lower mining activity in The Americas and Asia Pacific [11] Company Strategy and Development Direction - The company announced a restructuring action to lower structural costs by reducing employment costs and consolidating manufacturing operations [7] - Focus on growth initiatives in aerospace and defense, with expectations of long-term demand for energy and industrial production [11][12] - Commitment to executing value creation pillars to deliver above-market growth and continuous improvement [13] Management's Comments on Operating Environment and Future Outlook - Management noted modest declines across most markets, with some positive macro data points on industrial production in the U.S. [8] - The company expects to see positive trends from a growing middle class impacting general engineering and medical applications [11] - Management remains cautious about the economic impact of recent trade policies and is actively monitoring the situation [12][20] Other Important Information - The company achieved approximately $6 million in restructuring savings in the quarter and is on pace to achieve a $15 million run rate savings [10] - The estimated annual impact of tariffs is approximately $80 million, with actions underway to mitigate these costs [20] - The company returned $40 million to shareholders through share repurchase and dividend programs [37] Q&A Session Summary Question: Outlook for the fourth quarter and demand trends - Management indicated steady improvement in demand trends, with general engineering and transportation remaining flat, while aerospace and defense showed slight improvement [50][51] Question: Specifics on tariff mitigation actions - Management expressed confidence in fully mitigating the direct impact of tariffs, with actions already in progress [56][58] Question: Competitive dynamics and tariff relevance - Management noted competitive pressures in the earthworks segment due to soft coal prices and demand versus capacity issues in China [72][75] Question: Inventory position and strategic inventory management - Management acknowledged an increase in inventory, particularly in work-in-progress and raw materials, as a strategic move in response to changing demand [96][97] Question: Pricing outlook and cost management - Management confirmed that the pricing outlook remains at approximately 2%, excluding tariff impacts, with potential for higher pricing due to tariff surcharges [109][110]

Financial Data and Key Metrics Changes - Sales decreased by 6% year over year, with metal cutting sales declining 4% organically and infrastructure declining 2% organically [9][25] - Adjusted EPS increased to $0.47 compared to $0.30 in the prior year quarter, driven by restructuring benefits and an advanced manufacturing tax credit [12][28] - Adjusted EBITDA and operating margins were 17.9% and 10.3% respectively, compared to 14.2% and 8.1% in the prior year quarter [27] Business Line Data and Key Metrics Changes - Metal cutting sales were down 7% year over year, with a 4% organic decline and unfavorable foreign currency exchange of 3% [29] - Infrastructure sales declined 4% year over year, with an organic decline of 2% and unfavorable foreign currency exchange of 2% [32] - Aerospace and defense sales increased by 28%, while energy declined by 3% mainly in The Americas [33] Market Data and Key Metrics Changes - EMEA remained the slowest market, down 4% on a constant currency basis, while The Americas and Asia Pacific both declined by 1% [9][30] - General engineering and transportation were largely impacted by market conditions in EMEA and The Americas [11][30] - Aerospace and defense showed slight improvement as supply chain constraints eased [49] Company Strategy and Development Direction - The company is focused on executing growth initiatives in aerospace and defense, despite overall market weakness [8][10] - A restructuring action was announced to lower structural costs by reducing employment costs and consolidating manufacturing operations [7][10] - The company aims to fully mitigate the impact of tariffs through various actions, including optimizing product flow and evaluating alternative supply options [20][21] Management's Comments on Operating Environment and Future Outlook - Management noted that while there are short-term pressures across end markets, long-term trends for industrial production remain positive [11][12] - The company expects to achieve a $15 million annualized run rate savings from restructuring actions by June 30 [40] - Management remains committed to executing value creation initiatives to deliver a strong finish to fiscal 2025 [43] Other Important Information - The company returned $40 million to shareholders through share repurchase and dividend programs [36] - The estimated annual impact of tariffs is approximately $80 million, with ongoing mitigation actions in place [20][21] Q&A Session Summary Question: Can you discuss the outlook for the fourth quarter and demand trends? - Management indicated steady improvement in demand trends, with general engineering and transportation remaining flat, while aerospace and defense showed slight improvement [48][50] Question: Can you provide more details on tariff mitigation actions? - Management confirmed that they are confident in fully mitigating the direct impact of tariffs and have already begun implementing several actions [54][56] Question: What were the biggest surprises in the quarter relative to previous guidance? - The advanced manufacturing tax credit was a significant driver of performance, with tungsten prices expected to impact costs moving forward [66][68] Question: How is the competitive landscape affected by tariffs? - Management noted that they are performing better than peers and are well-positioned to utilize their global footprint to mitigate tariff impacts [73][74] Question: Are there any opportunities for M&A or portfolio optimization due to the changing trade situation? - Management acknowledged ongoing discussions regarding strategic priorities and potential portfolio actions in light of the tariff situation [81] Question: What is the pricing outlook for the final quarter of the year? - Management confirmed that the pricing outlook remains at approximately 2%, excluding tariff impacts [107]

Financial Data and Key Metrics Changes - Sales decreased by 6% year over year, with metal cutting sales declining 4% organically and infrastructure declining 2% organically [8][23] - Adjusted EPS increased to $0.47 compared to $0.30 in the prior year quarter, driven by restructuring benefits and an advanced manufacturing tax credit [11][26] - Adjusted EBITDA and operating margins were 17.9% and 10.3% respectively, compared to 14.2% and 8.1% in the prior year quarter [25] Business Line Data and Key Metrics Changes - Metal cutting sales were down 7% year over year, with a 4% organic decline and unfavorable foreign currency exchange of 3% [28] - Infrastructure sales declined 4% year over year, with an organic decline of 2% and unfavorable foreign currency exchange of 2% [31] - Aerospace and defense sales increased by 28%, while energy sales grew by 2% [32] Market Data and Key Metrics Changes - EMEA remained the slowest market, down 4% on a constant currency basis, while The Americas and Asia Pacific both declined by 1% [8][28] - General engineering and transportation were impacted by market conditions in EMEA and The Americas, while aerospace and defense showed slight improvement [10][29] Company Strategy and Development Direction - The company is focused on executing growth initiatives in aerospace and defense, despite overall market weakness [7][10] - A restructuring action was announced to lower structural costs by reducing employment costs and consolidating manufacturing operations [6][12] - The company aims to fully mitigate the impact of tariffs through various actions, including optimizing product flow and evaluating alternative supply options [19][20] Management's Comments on Operating Environment and Future Outlook - Management noted that most markets have been modestly declining for over thirty months, but they remain focused on controllable factors [7][10] - The company tightened its fiscal 2025 sales outlook to reflect the latest forecasts of specific market drivers and general market conditions [12][37] - Management expressed confidence in long-term mega trends for industrial production, including growth in aerospace and defense [10][40] Other Important Information - The company achieved approximately $6 million in restructuring savings during the quarter and is on pace to achieve a $15 million run rate savings [9][11] - The estimated annual impact of tariffs is approximately $80 million, with ongoing mitigation actions in place [19][96] - The company returned $40 million to shareholders through share repurchase and dividend programs [35] Q&A Session Summary Question: Can you discuss the outlook for the fourth quarter and demand trends? - Management indicated steady improvement in demand trends, with most markets remaining flat, and noted that they expect to gain market share [44][49] Question: Can you provide more details on tariff mitigation efforts? - Management confirmed that they are confident in fully mitigating the direct impact of tariffs and are already implementing several actions [52][54] Question: What were the biggest surprises in the quarter relative to previous guidance? - Management highlighted the advanced manufacturing tax credit as a significant driver of performance, with overall cost structure coming in better than expected [60][66] Question: How is the competitive landscape affected by tariffs? - Management noted that they are performing better than peers and are well-positioned to utilize their global footprint to mitigate tariff impacts [71][72] Question: Are there any opportunities for M&A or portfolio optimization due to the changing trade situation? - Management acknowledged ongoing discussions regarding strategic priorities and potential portfolio actions in light of the tariff situation [80] Question: What is the pricing outlook for the remainder of the year? - Management confirmed that the pricing outlook remains at approximately 2%, excluding tariff impacts, but could be higher with tariff surcharges [105][106]

Company Performance - Kennametal reported quarterly earnings of $0.47 per share, exceeding the Zacks Consensus Estimate of $0.26 per share, and up from $0.30 per share a year ago, representing an earnings surprise of 80.77% [1] - The company posted revenues of $486.4 million for the quarter ended March 2025, which missed the Zacks Consensus Estimate by 0.80% and decreased from year-ago revenues of $515.79 million [2] - Over the last four quarters, Kennametal has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Outlook - The stock has underperformed the market, losing about 17.5% since the beginning of the year compared to the S&P 500's decline of 4.7% [3] - The current consensus EPS estimate for the coming quarter is $0.37 on revenues of $520.2 million, and for the current fiscal year, it is $1.13 on revenues of $1.97 billion [7] - The estimate revisions trend for Kennametal is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Manufacturing - Tools & Related Products industry, to which Kennametal belongs, is currently in the bottom 11% of over 250 Zacks industries, suggesting a challenging environment [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Kennametal's stock performance [5]

FY25 Third Quarter Earnings Call Presentation May 7, 2025 Q3 FY25 EARNINGS Safe Harbor Statement 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, adjusted operating income, adj ...

Exhibit 99.1 DATE: May 7, 2025 PITTSBURGH, (May 7, 2025) – 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 Reductio ...