Kadant (KAI) Tops Q1 EPS by 11c, Revenues Beat; Lifts FY19 EPS/Revenue Mid-Point Guidance, Affirms Q2 EPS/Revenue Views Below Consensus

Kadant (NYSE: KAI) reported Q1 EPS of $1.24, $0.11 better than the analyst estimate of $1.13. Revenue for the quarter came in at $171 million versus the consensus estimate of $164.3 million.

• Revenue increased 15% to a record $171 million
• GAAP diluted EPS was unchanged at $0.96
• Adjusted diluted EPS increased 16% to $1.24
• Net income was unchanged at $11 million
• Adjusted EBITDA increased 27% to $30 million and represented 17.5% of revenue
• Gross margin was 41.2%
• Bookings increased 1% to a record $184 million
• Revenue and bookings for parts and consumables were a record at $113 million and $120 million, respectively
• Backlog increased 16% sequentially to a record $200 million
• Cash flow from operations increased 37% to $10 million

“Strong operating performance across our businesses led to our adjusted EBITDA increasing 27 percent and cash flow from operations increasing 37 percent compared to the first quarter of 2018. We continued to see healthy market conditions in North America, while China experienced slower activity due to restrictions on wastepaper imports and weaker demand. We are seeing strong project activity in Southeast Asia as producers seek to build capacity outside of China.

“Our parts and consumables revenue and bookings in the first quarter were also outstanding, up 18 percent and 17 percent, respectively, compared to the first quarter of 2018. This continues to be a strategic focus of ours and I am pleased to see these positive results.”

GUIDANCE:

Kadant sees FY2019 EPS of $5.20-$5.35, versus the consensus of $5.31. Kadant sees FY2019 revenue of $700-710 million, versus the consensus of $706.57 million.

Kadant sees Q2 2019 EPS of $1.07-$1.13, versus the consensus of $1.17. Kadant sees Q2 2019 revenue of $165-170 million, versus the consensus of $172.86 million.

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

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