Kadant (KAI) Tops Q1 EPS by 11c, Beats on Revenues; Raises FY18 EPS/Revenue Guidance Above Consensus

Kadant (NYSE: KAI) reported Q1 EPS of $1.07, $0.11 better than the analyst estimate of $0.96. Revenue for the quarter came in at $149 million versus the consensus estimate of $145.32 million.

First Quarter 2018 Highlights

• Revenue increased 45% to $149 million
• GAAP diluted EPS increased 20% to $0.96
• Adjusted diluted EPS increased 30% to $1.07
• Net income increased 21% to $11 million
• Adjusted EBITDA increased 49% to $24 million and represented 16% of revenue
• Gross margin was 44.3%
• Bookings increased 53% to a record $182 million
• Record bookings and revenue for parts and consumables of $103 and $96 million, respectively
• Backlog increased 24% sequentially to a record $180 million
• Cash flow from operations was $7 million

Summary and Outlook“We are encouraged by our bookings trend and the excellent start to 2018,” Mr. Painter continued. “Based on our record bookings performance in the first quarter, as well as our outlook for the remainder of the year, we are increasing our guidancefor 2018. We expect to report full year revenue of $625 to $635 million, increased from our previous guidance of $605 to $615 million. We expect to achieve GAAP diluted EPS of $4.98 to $5.08 in 2018, increased from our previous guidance of $4.74 to $4.84. The 2018 guidance incorporates an increase in our forecasted interest and tax expense. The 2018 guidance includes pre-tax restructuring costs of $1.7 million, or $0.11 per diluted share, discrete tax expense of $0.4 million, or $0.04 per diluted share, and pre-tax amortization expense associated with acquired backlog of $0.2 million, or $0.02 per diluted share. Excluding these expenses, we expect adjusted diluted EPS of $5.15 to $5.25 for 2018. For the second quarter of 2018, we expect GAAP diluted EPS of $0.89 to $0.94 on revenue of $150 to $154 million. The second quarter of 2018 guidance includes pre-tax restructuring costs of $0.8 million, or $0.06 per diluted share. Excluding this expense, we expect adjusted diluted EPS of $0.95 to $1.00 for the second quarter of 2018.”

GUIDANCE:

Kadant sees FY2018 EPS of $5.15-$5.25, versus the consensus of $5.02. Kadant sees FY2018 revenue of $625-635 million, versus the consensus of $613.76 million.

For earnings history and earnings-related data on Kadant (KAI) click here.

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