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Kennametal Announces Fiscal 2025 Second Quarter Results
KennametalKennametal(US:KMT) Prnewswireยท2025-02-05 11:30

Core Insights - Kennametal Inc. reported a decline in sales and earnings for the second quarter of fiscal 2025, with sales of $482 million, down 3% from $495 million in the prior year quarter, and earnings per diluted share (EPS) of $0.23 compared to $0.29 in the prior year quarter [1][3][8] Financial Performance - The company achieved an adjusted EPS of $0.25, down from $0.30 in the prior year quarter [1][8] - Operating income increased to $32 million, representing a margin of 6.6%, compared to $28 million and a margin of 5.7% in the prior year quarter [6][29] - Year-to-date net cash flow from operating activities was $101 million, up from $88 million in the prior year period, with free operating cash flow (FOCF) of $57 million compared to $36 million in the prior year [8][32] Market Conditions - The company noted weakening conditions in several end markets, particularly in EMEA, leading to a reduction in the full-year outlook [2][8] - Organic sales declined by 6%, partially offset by a favorable business days effect of 3% [3][34] Restructuring and Cost Management - Kennametal achieved approximately $6 million in incremental year-over-year restructuring savings, contributing to an annualized run rate pre-tax savings of about $35 million [4][6] - Additional restructuring actions announced on January 14, 2025, are expected to deliver annualized run rate pre-tax savings of approximately $15 million by the end of fiscal 2025 [5][8] Segment Performance - Metal Cutting sales decreased by 4% to $298 million, with an operating income margin of 5.6%, down from 8.2% in the prior year quarter [13][29] - Infrastructure sales remained flat at $184 million, with an operating income margin of 8.5%, significantly improved from 1.8% in the prior year quarter [14][29] Dividend and Share Repurchase - The company declared a quarterly cash dividend of $0.20 per share, payable on February 25, 2025 [17] - During the quarter, Kennametal repurchased 525 thousand shares for $15 million, with a total of 1.1 million shares repurchased for $30 million under a $200 million program [10][8]