Kennametal(US:KMT)2022-11-03 18:31Financial Performance - Sales for the three months ended September 30, 2022, were $494,792 thousand, an increase of 2.6% compared to $483,509 thousand in the same period of 2021[14] - Gross profit for the same period was $159,968 thousand, slightly down from $160,750 thousand year-over-year[14] - Net income attributable to Kennametal for the three months ended September 30, 2022, was $28,196 thousand, a decrease of 22.1% from $36,198 thousand in 2021[14] - Basic earnings per share decreased to $0.35 from $0.43, reflecting a decline of 18.6% year-over-year[14] - Operating income decreased to $48.5 million from $54.6 million in the prior year, primarily due to higher raw material costs of approximately $17 million and foreign currency exchange headwinds of about $6 million[61] - Earnings per diluted share (EPS) for the current quarter was $0.34, down from $0.43 in the prior year quarter[66] - Total sales for the three months ended September 30, 2022, were $494.8 million, a 2.7% increase from $483.5 million in the prior year[75] Assets and Liabilities - Total assets as of September 30, 2022, were $2,516,208 thousand, down from $2,573,524 thousand as of June 30, 2022[16] - Current liabilities increased to $497,488 thousand from $485,649 thousand in the previous quarter[16] - The company had $79.9 million of borrowings outstanding under its credit agreement as of September 30, 2022, compared to $19.0 million as of June 30, 2022[38] - As of September 30, 2022, total debt was $679.8 million, with $79.9 million of borrowings outstanding and $620.1 million of additional availability under the Credit Agreement[87][90] - Working capital decreased by $25.1 million to $514.0 million as of September 30, 2022, primarily due to increased borrowings of $64.1 million and a decrease in cash and cash equivalents of $21.0 million[97] Cash Flow - Net cash flow used in operating activities was $(10,748) thousand for the three months ended September 30, 2022, compared to $15,803 thousand in the same period of 2021[17] - Cash flow used in operating activities was $10.7 million, compared to cash flow provided of $15.8 million in the prior year[91] - Cash flow used in investing activities was $29.3 million, primarily for capital expenditures related to equipment upgrades[93] - Cash flow provided by financing activities was $23.1 million, including $60.9 million of borrowings under the Credit Agreement[95] Equity and Shareholder Returns - Total equity as of September 30, 2022, was $1,238.345 million, a decrease from $1,364.647 million as of September 30, 2021[48] - Cash dividends paid were $0.20 per share, totaling $(16.276) million for the three months ended September 30, 2022[48] - The company repurchased $19 million of common stock during the quarter, with a total of $105 million repurchased to date under its $200 million program[65] - Shareholders' equity decreased by $51.2 million to $1,201.4 million, mainly due to a comprehensive loss of $49.0 million and stock repurchases of $19.4 million[100] Segment Performance - The Metal Cutting segment reported sales of $299.9 million, while the Infrastructure segment reported sales of $194.9 million for the quarter[55] - Operating income for the Metal Cutting segment was $28.6 million, down from $29.2 million, primarily due to $5 million in higher raw material costs and foreign currency exchange headwinds[78] - Infrastructure operating income decreased to $20.8 million from $26.0 million, impacted by $13 million in higher raw material costs and supply chain disruptions[81] - Organic sales growth for the three months ended September 30, 2022, was 9% for Metal Cutting and 10% for Infrastructure, resulting in a total organic sales growth of 9%[106] Market and Economic Factors - The company experienced a 12% sales growth in the Americas region, while EMEA saw an 11% decline in sales[68] - Constant currency end market sales growth for Aerospace was 25%, while Energy and Earthworks saw growth of 15% and 11%, respectively[108] - Constant currency regional sales growth was 13% in the Americas, while EMEA experienced a decline of 11%[108] Other Financial Metrics - The effective income tax rate for the three months ended September 30, 2022, was 27.5%, slightly up from 27.0% in the same period of 2021[43] - The company recorded net periodic pension income of $(620,000) for the three months ended September 30, 2022, compared to $(4.1 million) for the same period in 2021[32] - The company incurred interest expense of $6,638 thousand for the three months ended September 30, 2022, compared to $6,321 thousand in the same period of 2021[14] - The company recorded a total comprehensive loss attributable to Kennametal shareholders of $(19,050) thousand for the three months ended September 30, 2022, compared to a comprehensive income of $24,104 thousand in 2021[15]