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Pennsylvania
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25-0900168
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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World Headquarters
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1600 Technology Way
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P.O. Box 231
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Latrobe, Pennsylvania
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15650-0231
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Capital Stock, par value $1.25 per share
|
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New York Stock Exchange
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Preferred Stock Purchase Rights
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New York Stock Exchange
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Large accelerated filer [X]
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Accelerated filer [ ]
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Non-accelerated filer [ ] (Do not check if smaller reporting company)
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Smaller reporting company [ ]
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Item No.
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Page
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1
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1A.
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1B.
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2.
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3.
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4.
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5.
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6.
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7.
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7A.
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8.
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9.
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9A.
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9B.
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10.
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11.
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12.
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13.
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14.
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15.
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Location
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Owned/Leased
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Principal Products
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Segment
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United States:
|
|
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Grant, Alabama
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Owned
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Carbide Blanks & Wear Parts
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Infrastructure
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Gurley, Alabama
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Owned
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Metallurgical Powders
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Infrastructure
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Huntsville, Alabama
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Owned
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Metallurgical Powders
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Infrastructure
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Irondale, Alabama
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Owned
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Custom Fabricated Wear Plate Solutions and Pins
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Infrastructure
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Madison, Alabama
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Owned
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Tungsten Heavy Alloy
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Infrastructure
|
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Rogers, Arkansas
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Owned/Leased
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Carbide Products and Pelletizing Die Plates
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Infrastructure
|
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University Park, Illinois
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Owned
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Custom Fabricated Wear Plate Solutions
|
Infrastructure
|
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Rockford, Illinois
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Owned
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Indexable Tooling
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Industrial
|
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Goshen, Indiana
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Leased
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Powders; Welding Rods, Wires and Machines
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Infrastructure
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New Albany, Indiana
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Leased
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High Wear Coating for Steel Parts
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Infrastructure
|
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Greenfield, Massachusetts
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Owned
|
High-Speed Steel Taps
|
Industrial
|
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Shelby Township, Michigan
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Leased
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Thermal Deburring and High Energy Finishing
|
Industrial
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Traverse City, Michigan
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Owned
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Wear Parts
|
Industrial
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Elko, Nevada
|
Owned
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Custom Fabricated Wear Plate Solutions
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Infrastructure
|
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Fallon, Nevada
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Owned
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Metallurgical Powders
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Infrastructure
|
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Asheboro, North Carolina
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Owned
|
Carbide Round Tools
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Industrial
|
|
Henderson, North Carolina
|
Owned
|
Metallurgical Powders
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Infrastructure
|
|
Roanoke Rapids, North Carolina
|
Owned
|
Metalworking Inserts
|
Industrial
|
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Cleveland, Ohio
|
Leased
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Distribution
|
Industrial
|
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Orwell, Ohio
|
Owned
|
Metalworking Inserts
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Industrial
|
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Solon, Ohio
|
Owned
|
Metalworking Toolholders
|
Industrial
|
|
Whitehouse, Ohio
|
Owned
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Metalworking Inserts and Round Tools
|
Industrial
|
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Bedford, Pennsylvania
|
Owned/Leased
|
Mining and Construction Tools and Wear Parts and Distribution
|
Infrastructure
|
|
Irwin, Pennsylvania
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Owned/Leased
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Carbide Wear Parts and Abrasive Flow Machining
|
Industrial
|
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Latrobe, Pennsylvania
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Owned
|
Metallurgical Powders
|
Infrastructure
|
|
New Castle, Pennsylvania
|
Owned/Leased
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Specialty Metals and Alloys
|
Industrial
|
Quarter ended
|
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September 30
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|
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December 31
|
|
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March 31
|
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June 30
|
|
||||
Fiscal 2014
|
|
|
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||||||||
High
|
|
$
|
47.95
|
|
|
$
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52.37
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|
|
$
|
52.18
|
|
|
$
|
49.24
|
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Low
|
|
37.98
|
|
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43.10
|
|
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38.85
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42.66
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|
||||
Dividends
|
|
0.18
|
|
|
0.18
|
|
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0.18
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0.18
|
|
||||
Fiscal 2013
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
$
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40.95
|
|
|
$
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41.51
|
|
|
$
|
44.59
|
|
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$
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43.86
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Low
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31.62
|
|
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33.95
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|
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37.87
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35.49
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||||
Dividends
|
|
0.16
|
|
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0.16
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|
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0.16
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0.16
|
|
|
2009
|
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2010
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2011
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2012
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2013
|
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2014
|
|
||||||
Kennametal
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$
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100.00
|
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$
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135.21
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$
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227.56
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$
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181.16
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$
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215.74
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$
|
261.24
|
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Old Peer Group Index
|
100.00
|
|
128.60
|
|
202.06
|
|
177.05
|
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218.57
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|
282.10
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||||||
New Peer Group Index
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100.00
|
|
134.42
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|
209.82
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179.67
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211.20
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270.56
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|
||||||
S&P Midcap 400
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100.00
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124.93
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174.13
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170.07
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212.90
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|
266.63
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||||||
S&P 1500 Composite
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100.00
|
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115.57
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152.14
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159.18
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192.81
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|
240.44
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|
||||||
Russell 3000
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100.00
|
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115.72
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153.18
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159.06
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193.20
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241.92
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Period
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Total Number
of Shares Purchased
(1)
|
|
|
Average Price
Paid per Share
|
|
|
Total Number of
Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
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Maximum Number
of Shares that May
Yet Be Purchased
Under the Plans or
Programs
(2)
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April 1 through April 30, 2014
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1,031
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|
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$
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44.69
|
|
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—
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10,100,100
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May 1 through May 31, 2014
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6,623
|
|
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46.78
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—
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10,100,100
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June 1 through June 30, 2014
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5,841
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47.17
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—
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10,100,100
|
|
|
Total
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13,495
|
|
|
$
|
46.79
|
|
|
—
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|
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(1)
|
During the fourth quarter of 2014, 2,194 shares were purchased on the open market on behalf of Kennametal to fund the Company’s dividend reinvestment program. Also, during the current period employees delivered 4,301 shares of restricted stock to Kennametal, upon vesting, to satisfy tax withholding requirements and 7,000 shares of Kennametal stock as payment for the exercise price of stock options.
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(2)
|
On July 25, 2013, the Company publicly announced an amended repurchase program for up to 17 million shares of its outstanding capital stock.
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|
|
2014
|
2013
|
2012
|
2011
|
2010
|
|||||||||||
OPERATING RESULTS (in thousands)
|
|
|
|
||||||||||||||
Sales
|
|
$
|
2,837,190
|
|
$
|
2,589,373
|
|
$
|
2,736,246
|
|
$
|
2,403,493
|
|
$
|
1,884,067
|
|
|
Cost of goods sold
|
|
1,940,187
|
|
1,744,369
|
|
1,741,996
|
|
1,519,102
|
|
1,256,339
|
|
||||||
Operating expense
|
|
589,768
|
|
527,850
|
|
561,490
|
|
538,530
|
|
477,487
|
|
||||||
Restructuring charges
|
|
17,608
|
|
—
|
|
—
|
|
12,586
|
|
43,923
|
|
||||||
Interest expense
|
|
32,451
|
|
27,472
|
|
27,215
|
|
22,760
|
|
25,203
|
|
||||||
Provision for income taxes
|
|
66,611
|
|
59,693
|
|
79,136
|
|
63,856
|
|
26,977
|
|
||||||
Income from continuing operations attributable to Kennametal
|
|
158,366
|
|
203,265
|
|
307,230
|
|
229,727
|
|
47,842
|
|
||||||
Net income attributable to Kennametal
|
(1
|
)
|
158,366
|
|
203,265
|
|
307,230
|
|
229,727
|
|
46,419
|
|
|||||
FINANCIAL POSITION (in thousands)
|
|
|
|
|
|
|
|||||||||||
Working capital
|
|
$
|
962,440
|
|
$
|
1,031,880
|
|
$
|
704,340
|
|
$
|
446,064
|
|
$
|
522,926
|
|
|
Total assets
|
|
3,868,086
|
|
3,301,039
|
|
3,034,188
|
|
2,754,469
|
|
2,267,823
|
|
||||||
Long-term debt, including capital leases, excluding current maturities
|
|
981,666
|
|
703,626
|
|
490,608
|
|
1,919
|
|
314,675
|
|
||||||
Total debt, including capital leases and notes payable
|
|
1,061,783
|
|
747,945
|
|
565,745
|
|
312,882
|
|
337,668
|
|
||||||
Total Kennametal shareowners' equity
|
|
1,929,256
|
|
1,781,826
|
|
1,643,850
|
|
1,638,072
|
|
1,315,500
|
|
||||||
PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREOWNERS
|
|
|
|||||||||||||||
Basic earnings from continuing operations
|
|
$
|
2.01
|
|
$
|
2.56
|
|
$
|
3.83
|
|
$
|
2.80
|
|
$
|
0.59
|
|
|
Basic earnings
|
(2
|
)
|
2.01
|
|
2.56
|
|
3.83
|
|
2.80
|
|
0.57
|
|
|||||
Diluted earnings from continuing operations
|
|
1.99
|
|
2.52
|
|
3.77
|
|
2.76
|
|
0.59
|
|
||||||
Diluted earnings
|
(3
|
)
|
1.99
|
|
2.52
|
|
3.77
|
|
2.76
|
|
0.57
|
|
|||||
Dividends
|
|
0.72
|
|
0.64
|
|
0.54
|
|
0.48
|
|
0.48
|
|
||||||
Book value (at June 30)
|
|
24.52
|
|
22.89
|
|
20.53
|
|
20.19
|
|
16.06
|
|
||||||
Market Price (at June 30)
|
|
46.28
|
|
38.83
|
|
33.15
|
|
42.21
|
|
25.43
|
|
||||||
OTHER DATA (in thousands, except number of employees)
|
|
|
|
||||||||||||||
Capital expenditures
|
|
$
|
117,376
|
|
$
|
82,835
|
|
$
|
103,036
|
|
$
|
83,442
|
|
$
|
56,679
|
|
|
Number of employees (at June 30)
|
|
13,521
|
|
12,648
|
|
12,932
|
|
11,612
|
|
11,047
|
|
||||||
Basic weighted average shares outstanding
|
78,678
|
|
79,463
|
|
80,216
|
|
82,063
|
|
80,966
|
|
|||||||
Diluted weighted average shares outstanding
|
79,667
|
|
80,612
|
|
81,439
|
|
83,173
|
|
81,690
|
|
|||||||
KEY RATIOS
|
|
|
|
|
|
|
|||||||||||
Sales growth
|
|
9.6
|
%
|
(5.4
|
)%
|
13.8
|
%
|
27.6
|
%
|
(5.8
|
)%
|
||||||
Gross profit margin
|
|
31.6
|
|
32.6
|
|
36.3
|
|
36.8
|
|
33.3
|
|
||||||
Operating profit margin
|
|
9.3
|
|
11.4
|
|
15.2
|
|
13.4
|
|
4.9
|
|
(1)
|
Net income attributable to Kennametal includes loss from discontinued operations of $(1.4) million for 2010.
|
(2)
|
Basic earnings per share includes basic loss from discontinued operations per share of $(0.02) for 2010.
|
(3)
|
Diluted earnings per share includes diluted loss from discontinued operations per share of $(0.02) for 2010.
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
External sales
|
|
$
|
1,524,075
|
|
|
$
|
1,386,690
|
|
|
$
|
1,560,157
|
|
Operating income
|
|
177,040
|
|
|
192,828
|
|
|
278,105
|
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
External sales
|
|
$
|
1,313,115
|
|
|
$
|
1,202,683
|
|
|
$
|
1,176,089
|
|
Operating income
|
|
94,940
|
|
|
111,453
|
|
|
146,768
|
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Corporate unallocated expense
|
|
$
|
(8,548
|
)
|
|
$
|
(7,887
|
)
|
|
$
|
(8,464
|
)
|
Contractual Obligations
|
|
|
|
Total
|
|
|
2015
|
|
|
2016-2017
|
|
|
2018-2019
|
|
|
Thereafter
|
|
||||||
Long-term debt
|
|
(1
|
)
|
|
$
|
1,126,572
|
|
|
$
|
33,048
|
|
|
$
|
50,839
|
|
|
$
|
326,445
|
|
|
$
|
716,240
|
|
Notes payable
|
|
(2
|
)
|
|
73,509
|
|
|
73,509
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Pension benefit payments
|
|
|
|
(3)
|
|
48,958
|
|
|
99,271
|
|
|
107,754
|
|
|
(3)
|
||||||||
Postretirement benefit payments
|
|
|
|
(3)
|
|
2,307
|
|
|
4,407
|
|
|
4,080
|
|
|
(3)
|
||||||||
Capital leases
|
|
(4
|
)
|
|
3,127
|
|
|
247
|
|
|
2,682
|
|
|
198
|
|
|
—
|
|
|||||
Operating leases
|
|
|
|
74,432
|
|
|
21,569
|
|
|
22,889
|
|
|
6,004
|
|
|
23,970
|
|
||||||
Purchase obligations
|
|
(5
|
)
|
|
927,759
|
|
|
365,993
|
|
|
497,812
|
|
|
34,077
|
|
|
29,877
|
|
|||||
Unrecognized tax benefits
|
|
(6
|
)
|
|
22,048
|
|
|
663
|
|
|
—
|
|
|
—
|
|
|
21,385
|
|
|||||
Total
|
|
|
|
|
|
$
|
546,294
|
|
|
$
|
677,900
|
|
|
$
|
478,558
|
|
|
$
|
791,466
|
|
(1)
|
Long-term debt includes interest obligations of $140.1 million. Interest obligations were determined assuming interest rates as of
June 30, 2014
|
(2)
|
Notes payable includes interest obligations of $1.0 million. Interest obligations were determined assuming interest rates as of
June 30, 2014
remain constant.
|
(3)
|
Annual payments are expected to continue into the foreseeable future at the amounts noted in the table.
|
(4)
|
Capital leases include interest obligations of $0.2 million.
|
(5)
|
Purchase obligations consist of purchase commitments for materials, supplies and machinery and equipment as part of the ordinary conduct of business. Purchase obligations with variable price provisions were determined assuming market prices as of
June 30, 2014
remain constant.
|
(6)
|
Unrecognized tax benefits are positions taken or expected to be taken on an income tax return that may result in additional payments to tax authorities. These amounts include interest of $1.3 million and penalty of $0.4 million accrued related to such positions as of
June 30, 2014
. The amount included for 2015 is expected to be settled within the next twelve months. The remaining amount of unrecognized tax benefits is included in the ‘Thereafter’ column as we are not able to reasonably estimate the timing of potential future payments of the total amount included in the 'Thereafter' column, $16.4 million of income tax credits would be available in the U.S. to offset the payment if made to the relevant tax authority. If a tax authority agrees with the tax position taken or expected to be taken or the applicable statute of limitations expires, then additional payments will not be necessary.
|
Other Commercial Commitments
|
|
Total
|
|
|
2015
|
|
|
2016-2017
|
|
|
2018-2019
|
|
|
Thereafter
|
|
|||||
Standby letters of credit
|
|
$
|
4,564
|
|
|
$
|
4,564
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Guarantees
|
|
26,919
|
|
|
18,908
|
|
|
183
|
|
|
275
|
|
|
7,553
|
|
|||||
Total
|
|
$
|
31,483
|
|
|
$
|
23,472
|
|
|
$
|
183
|
|
|
$
|
275
|
|
|
$
|
7,553
|
|
Year ended June 30 (in thousands, except per share data)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Sales
|
$
|
2,837,190
|
|
|
$
|
2,589,373
|
|
|
$
|
2,736,246
|
|
Cost of goods sold
|
1,940,187
|
|
|
1,744,369
|
|
|
1,741,996
|
|
|||
Gross profit
|
897,003
|
|
|
845,004
|
|
|
994,250
|
|
|||
Operating expense
|
589,768
|
|
|
527,850
|
|
|
561,490
|
|
|||
Restructuring charges (Note 14)
|
17,608
|
|
|
—
|
|
|
—
|
|
|||
Amortization of intangibles
|
26,195
|
|
|
20,760
|
|
|
16,351
|
|
|||
Operating income
|
263,432
|
|
|
296,394
|
|
|
416,409
|
|
|||
Interest expense
|
32,451
|
|
|
27,472
|
|
|
27,215
|
|
|||
Other expense (income), net
|
2,172
|
|
|
2,313
|
|
|
(775
|
)
|
|||
Income before income taxes
|
228,809
|
|
|
266,609
|
|
|
389,969
|
|
|||
Provision for income taxes
|
66,611
|
|
|
59,693
|
|
|
79,136
|
|
|||
Net income
|
162,198
|
|
|
206,916
|
|
|
310,833
|
|
|||
Less: Net income attributable to noncontrolling interests
|
3,832
|
|
|
3,651
|
|
|
3,603
|
|
|||
Net income attributable to Kennametal
|
$
|
158,366
|
|
|
$
|
203,265
|
|
|
$
|
307,230
|
|
PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREOWNERS
|
|
|
|||||||||
Basic earnings per share
|
$
|
2.01
|
|
|
$
|
2.56
|
|
|
$
|
3.83
|
|
Diluted earnings per share
|
$
|
1.99
|
|
|
$
|
2.52
|
|
|
$
|
3.77
|
|
Dividends per share
|
$
|
0.72
|
|
|
$
|
0.64
|
|
|
$
|
0.54
|
|
Basic weighted average shares outstanding
|
78,678
|
|
|
79,463
|
|
|
80,216
|
|
|||
Diluted weighted average shares outstanding
|
79,667
|
|
|
80,612
|
|
|
81,439
|
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Net income
|
|
$
|
162,198
|
|
|
$
|
206,916
|
|
|
$
|
310,833
|
|
Unrealized loss on derivatives designated and qualified as cash flow hedges, net of income tax benefit of $0.4 million, $0.4 million and $7.0 million, respectively
|
|
(706
|
)
|
|
(611
|
)
|
|
(11,165
|
)
|
|||
Reclassification of unrealized loss (gain) on expired derivatives designated and qualified as cash flow hedges, net of income tax benefit (expense) of $1.2 million, $0.9 million and ($0.1) million, respectively
|
|
1,987
|
|
|
1,377
|
|
|
(186
|
)
|
|||
Unrecognized net pension and other postretirement benefit (loss) gain, net of income tax benefit (expense) of $3.9 million, ($25.0) million and $50.6 million, respectively
|
|
(11,990
|
)
|
|
39,376
|
|
|
(90,686
|
)
|
|||
Reclassification of net pension and other postretirement benefit loss, net of income tax benefit of $0.5 million, $5.5 million and $3.0 million, respectively
|
|
2,184
|
|
|
9,679
|
|
|
5,964
|
|
|||
Foreign currency translation adjustments, net of income tax (expense) benefit of ($1.7) million, ($1.2) million and $5.1 million, respectively
|
|
31,763
|
|
|
9,223
|
|
|
(140,797
|
)
|
|||
Total comprehensive income
|
|
185,436
|
|
|
265,960
|
|
|
73,963
|
|
|||
Less: comprehensive income (loss) attributable to noncontrolling interests
|
|
4,198
|
|
|
3,101
|
|
|
(76
|
)
|
|||
Comprehensive income attributable to Kennametal Shareowners
|
|
$
|
181,238
|
|
|
$
|
262,859
|
|
|
$
|
74,039
|
|
As of June 30 (in thousands, except per share data)
|
2014
|
|
|
2013
|
|
||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
177,929
|
|
|
$
|
377,316
|
|
Accounts receivable, less allowance for doubtful accounts of $14,027 and $11,949
|
531,515
|
|
|
445,322
|
|
||
Inventories (Note 7)
|
703,766
|
|
|
578,795
|
|
||
Deferred income taxes (Note 11)
|
47,897
|
|
|
49,707
|
|
||
Other current assets
|
64,089
|
|
|
48,333
|
|
||
Total current assets
|
1,525,196
|
|
|
1,499,473
|
|
||
Property, plant and equipment:
|
|
|
|
||||
Land and buildings
|
437,783
|
|
|
381,215
|
|
||
Machinery and equipment
|
1,638,215
|
|
|
1,466,942
|
|
||
Less accumulated depreciation
|
(1,191,540
|
)
|
|
(1,106,675
|
)
|
||
Property, plant and equipment, net
|
884,458
|
|
|
741,482
|
|
||
Other assets:
|
|
|
|
||||
Investments in affiliated companies
|
495
|
|
|
671
|
|
||
Goodwill (Note 2)
|
975,576
|
|
|
721,755
|
|
||
Other intangible assets, less accumulated amortization of $139,245 and $111,440 (Note 2)
|
343,176
|
|
|
222,765
|
|
||
Deferred income taxes (Note 11)
|
41,006
|
|
|
39,590
|
|
||
Other
|
98,179
|
|
|
75,303
|
|
||
Total other assets
|
1,458,432
|
|
|
1,060,084
|
|
||
Total assets
|
$
|
3,868,086
|
|
|
$
|
3,301,039
|
|
LIABILITIES
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current maturities of long-term debt and capital leases (Note 9)
|
$
|
7,662
|
|
|
$
|
3,738
|
|
Notes payable to banks (Note 10)
|
72,455
|
|
|
40,581
|
|
||
Accounts payable
|
206,891
|
|
|
190,623
|
|
||
Accrued income taxes
|
16,953
|
|
|
19,471
|
|
||
Accrued vacation pay
|
38,456
|
|
|
39,410
|
|
||
Accrued payroll
|
61,436
|
|
|
49,023
|
|
||
Other current liabilities (Note 8)
|
158,903
|
|
|
124,747
|
|
||
Total current liabilities
|
562,756
|
|
|
467,593
|
|
||
Long-term debt and capital leases, less current maturities (Note 9)
|
981,666
|
|
|
703,626
|
|
||
Deferred income taxes (Note 11)
|
118,092
|
|
|
102,935
|
|
||
Accrued postretirement benefits (Note 12)
|
22,516
|
|
|
19,461
|
|
||
Accrued pension benefits (Note 12)
|
158,268
|
|
|
142,784
|
|
||
Accrued income taxes (Note 11)
|
21,384
|
|
|
27,530
|
|
||
Other liabilities
|
41,796
|
|
|
24,817
|
|
||
Total liabilities
|
1,906,478
|
|
|
1,488,746
|
|
||
Commitments and contingencies (Note 18)
|
|
|
|
||||
EQUITY
|
|
|
|
||||
Kennametal Shareowners’ Equity:
|
|
|
|
||||
Preferred stock, no par value; 5,000 shares authorized; none issued
|
—
|
|
|
—
|
|
||
Capital stock, $1.25 par value; 120,000 shares authorized; 78,672 and 77,842 shares issued
|
98,340
|
|
|
97,303
|
|
||
Additional paid-in capital
|
395,890
|
|
|
374,300
|
|
||
Retained earnings
|
1,501,157
|
|
|
1,399,227
|
|
||
Accumulated other comprehensive loss
|
(66,131
|
)
|
|
(89,004
|
)
|
||
Total Kennametal Shareowners’ Equity
|
1,929,256
|
|
|
1,781,826
|
|
||
Noncontrolling interests
|
32,352
|
|
|
30,467
|
|
||
Total equity
|
1,961,608
|
|
|
1,812,293
|
|
||
Total liabilities and equity
|
$
|
3,868,086
|
|
|
$
|
3,301,039
|
|
Year ended June 30 (in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
OPERATING ACTIVITIES
|
|
|
|
|
|
||||||
Net income
|
$
|
162,198
|
|
|
$
|
206,916
|
|
|
$
|
310,833
|
|
Adjustments for non-cash items:
|
|
|
|
|
|
||||||
Depreciation
|
104,027
|
|
|
92,344
|
|
|
87,722
|
|
|||
Amortization
|
26,195
|
|
|
20,760
|
|
|
16,351
|
|
|||
Stock-based compensation expense
|
17,641
|
|
|
21,874
|
|
|
21,500
|
|
|||
Restructuring charges
|
3,408
|
|
|
—
|
|
|
—
|
|
|||
Deferred income tax provision
|
23,119
|
|
|
232
|
|
|
28,602
|
|
|||
Other
|
2,106
|
|
|
2,577
|
|
|
(12,702
|
)
|
|||
Changes in certain assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(45,041
|
)
|
|
33,801
|
|
|
(10,891
|
)
|
|||
Inventories
|
(5,310
|
)
|
|
5,879
|
|
|
(63,833
|
)
|
|||
Accounts payable and accrued liabilities
|
13,748
|
|
|
(90,449
|
)
|
|
(57,003
|
)
|
|||
Accrued income taxes
|
(12,485
|
)
|
|
949
|
|
|
(14,157
|
)
|
|||
Other
|
(17,733
|
)
|
|
(10,733
|
)
|
|
(16,842
|
)
|
|||
Net cash flow provided by operating activities
|
271,873
|
|
|
284,150
|
|
|
289,580
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Purchases of property, plant and equipment
|
(117,376
|
)
|
|
(82,835
|
)
|
|
(103,036
|
)
|
|||
Disposals of property, plant and equipment
|
1,236
|
|
|
3,016
|
|
|
6,886
|
|
|||
Business acquisition, net of cash acquired (Note 4)
|
(634,615
|
)
|
|
(500
|
)
|
|
(382,562
|
)
|
|||
Purchase of technology license
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|||
Proceeds from sale of business
|
10,225
|
|
|
—
|
|
|
—
|
|
|||
Other
|
356
|
|
|
(379
|
)
|
|
1,447
|
|
|||
Net cash flow used for investing activities
|
(740,174
|
)
|
|
(80,698
|
)
|
|
(487,265
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Net increase (decrease) in notes payable
|
31,568
|
|
|
(833
|
)
|
|
38,198
|
|
|||
Net (decrease) increase in short-term revolving and other lines of credit
|
(3,600
|
)
|
|
(23,600
|
)
|
|
27,200
|
|
|||
Term debt borrowings
|
736,079
|
|
|
944,152
|
|
|
1,509,767
|
|
|||
Term debt repayments
|
(450,928
|
)
|
|
(736,562
|
)
|
|
(1,324,426
|
)
|
|||
Purchase of capital stock
|
(14,165
|
)
|
|
(121,408
|
)
|
|
(66,876
|
)
|
|||
Sale of subsidiary stock
|
—
|
|
|
26,665
|
|
|
—
|
|
|||
Settlement of interest rate swap agreement (Note 6)
|
—
|
|
|
—
|
|
|
(22,406
|
)
|
|||
Dividend reinvestment and the effect of employee benefit and stock plans
|
26,676
|
|
|
17,356
|
|
|
24,635
|
|
|||
Cash dividends paid to Shareowners
|
(56,436
|
)
|
|
(51,011
|
)
|
|
(43,631
|
)
|
|||
Other
|
1,214
|
|
|
(2,612
|
)
|
|
(11,162
|
)
|
|||
Net cash flow provided by financing activities
|
270,408
|
|
|
52,147
|
|
|
131,299
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(1,494
|
)
|
|
5,251
|
|
|
(21,713
|
)
|
|||
CASH AND CASH EQUIVALENTS
|
|
|
|
|
|
||||||
Net (decrease) increase in cash and cash equivalents
|
(199,387
|
)
|
|
260,850
|
|
|
(88,099
|
)
|
|||
Cash and cash equivalents, beginning of year
|
377,316
|
|
|
116,466
|
|
|
204,565
|
|
|||
Cash and cash equivalents, end of year
|
$
|
177,929
|
|
|
$
|
377,316
|
|
|
$
|
116,466
|
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||
Year ended June 30 (in thousands)
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|||
CAPITAL STOCK
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at beginning of year
|
77,842
|
|
|
$
|
97,303
|
|
|
80,085
|
|
|
$
|
100,106
|
|
|
81,129
|
|
|
$
|
101,411
|
|
Dividend reinvestment
|
7
|
|
|
9
|
|
|
6
|
|
|
8
|
|
|
8
|
|
|
10
|
|
|||
Capital stock issued under employee benefit and stock plans
|
1,155
|
|
|
1,443
|
|
|
837
|
|
|
1,047
|
|
|
956
|
|
|
1,195
|
|
|||
Purchase of capital stock
|
(332
|
)
|
|
(415
|
)
|
|
(3,086
|
)
|
|
(3,858
|
)
|
|
(2,008
|
)
|
|
(2,510
|
)
|
|||
Balance at end of year
|
78,672
|
|
|
98,340
|
|
|
77,842
|
|
|
97,303
|
|
|
80,085
|
|
|
100,106
|
|
|||
ADDITIONAL PAID-IN CAPITAL
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at beginning of year
|
|
|
374,300
|
|
|
|
|
447,433
|
|
|
|
|
470,758
|
|
||||||
Dividend reinvestment
|
|
|
319
|
|
|
|
|
253
|
|
|
|
|
282
|
|
||||||
Capital stock issued under employee benefit and stock plans
|
|
|
35,019
|
|
|
|
|
31,649
|
|
|
|
|
40,758
|
|
||||||
Sale of subsidiary stock to noncontrolling
interests
|
|
|
—
|
|
|
|
|
12,515
|
|
|
|
|
—
|
|
||||||
Purchase of capital stock
|
|
|
(13,748
|
)
|
|
|
|
(117,550
|
)
|
|
|
|
(64,365
|
)
|
||||||
Balance at end of year
|
|
|
395,890
|
|
|
|
|
374,300
|
|
|
|
|
447,433
|
|
||||||
RETAINED EARNINGS
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at beginning of year
|
|
|
1,399,227
|
|
|
|
|
1,246,973
|
|
|
|
|
983,374
|
|
||||||
Net income
|
|
|
158,366
|
|
|
|
|
203,265
|
|
|
|
|
307,230
|
|
||||||
Cash dividends paid to Shareowners
|
|
|
(56,436
|
)
|
|
|
|
(51,011
|
)
|
|
|
|
(43,631
|
)
|
||||||
Balance at end of year
|
|
|
1,501,157
|
|
|
|
|
1,399,227
|
|
|
|
|
1,246,973
|
|
||||||
ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at beginning of year
|
|
|
(89,004
|
)
|
|
|
|
(150,662
|
)
|
|
|
|
82,529
|
|
||||||
Unrealized loss on derivatives designated and qualified as cash flow hedges, net of tax
|
|
|
(706
|
)
|
|
|
|
(611
|
)
|
|
|
|
(11,165
|
)
|
||||||
Reclassification of unrealized loss (gain) on expired derivatives designated and qualified as cash flow hedges, net of tax
|
|
|
1,987
|
|
|
|
|
1,377
|
|
|
|
|
(186
|
)
|
||||||
Unrecognized net pension and other postretirement benefit (loss) gain, net of tax
|
|
|
(11,990
|
)
|
|
|
|
39,376
|
|
|
|
|
(90,686
|
)
|
||||||
Reclassification of net pension and other postretirement benefit loss, net of tax
|
|
|
2,184
|
|
|
|
|
9,679
|
|
|
|
|
5,964
|
|
||||||
Foreign currency translation adjustments, net of tax
|
|
|
31,398
|
|
|
|
|
9,772
|
|
|
|
|
(137,118
|
)
|
||||||
Other comprehensive income (loss), net of tax
|
|
|
22,873
|
|
|
|
|
59,593
|
|
|
|
|
(233,191
|
)
|
||||||
Sale of subsidiary stock to noncontrolling
interests
|
|
|
—
|
|
|
|
|
2,065
|
|
|
|
|
—
|
|
||||||
Balance at end of year
|
|
|
(66,131
|
)
|
|
|
|
(89,004
|
)
|
|
|
|
(150,662
|
)
|
||||||
NONCONTROLLING INTERESTS
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at beginning of year
|
|
|
30,467
|
|
|
|
|
24,371
|
|
|
|
|
20,569
|
|
||||||
Net income
|
|
|
3,832
|
|
|
|
|
3,651
|
|
|
|
|
3,603
|
|
||||||
Other comprehensive (loss) income, net of tax
|
|
|
366
|
|
|
|
|
(550
|
)
|
|
|
|
(3,679
|
)
|
||||||
Sale of subsidiary stock to noncontrolling
interests
|
|
|
—
|
|
|
|
|
7,727
|
|
|
|
|
—
|
|
||||||
Purchase of noncontrolling interests
|
|
|
—
|
|
|
|
|
(479
|
)
|
|
|
|
—
|
|
||||||
Acquisition by noncontrolling interests
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
5,211
|
|
||||||
Cash dividends paid to noncontrolling interests
|
|
|
(2,313
|
)
|
|
|
|
(4,253
|
)
|
|
|
|
(1,333
|
)
|
||||||
Balance at end of year
|
|
|
32,352
|
|
|
|
|
30,467
|
|
|
|
|
24,371
|
|
||||||
Total equity, June 30
|
|
|
$
|
1,961,608
|
|
|
|
|
$
|
1,812,293
|
|
|
|
|
$
|
1,668,221
|
|
(in thousands)
|
Industrial
|
|
|
Infrastructure
|
|
|
Total
|
|
|||
Goodwill
|
$
|
407,610
|
|
|
$
|
462,582
|
|
|
$
|
870,192
|
|
Accumulated impairment losses
|
(150,842
|
)
|
|
—
|
|
|
(150,842
|
)
|
|||
Balance as of June 30, 2012
|
$
|
256,768
|
|
|
$
|
462,582
|
|
|
$
|
719,350
|
|
Translation
|
1,315
|
|
|
1,090
|
|
|
2,405
|
|
|||
Change in goodwill
|
1,315
|
|
|
1,090
|
|
|
2,405
|
|
|||
Goodwill
|
408,925
|
|
|
463,672
|
|
|
872,597
|
|
|||
Accumulated impairment losses
|
(150,842
|
)
|
|
—
|
|
|
(150,842
|
)
|
|||
Balance as of June 30, 2013
|
$
|
258,083
|
|
|
$
|
463,672
|
|
|
$
|
721,755
|
|
Acquisition
|
$
|
60,100
|
|
|
$
|
183,477
|
|
|
$
|
243,577
|
|
Translation
|
3,312
|
|
|
6,932
|
|
|
10,244
|
|
|||
Change in goodwill
|
63,412
|
|
|
190,409
|
|
|
253,821
|
|
|||
Goodwill
|
472,337
|
|
|
654,081
|
|
|
1,126,418
|
|
|||
Accumulated impairment losses
|
(150,842
|
)
|
|
—
|
|
|
(150,842
|
)
|
|||
Balance as of June 30, 2014
|
$
|
321,495
|
|
|
$
|
654,081
|
|
|
$
|
975,576
|
|
|
Estimated
Useful Life
(in years)
|
|
June 30, 2014
|
|
June 30, 2013
|
||||||||||||
(in thousands)
|
|
Gross Carrying
Amount
|
|
|
Accumulated
Amortization
|
|
|
Gross Carrying
Amount
|
|
|
Accumulated
Amortization
|
|
|||||
Contract-based
|
3 to 15
|
|
$
|
23,446
|
|
|
$
|
(10,820
|
)
|
|
$
|
21,450
|
|
|
$
|
(8,374
|
)
|
Technology-based and other
|
4 to 20
|
|
54,842
|
|
|
(28,516
|
)
|
|
38,005
|
|
|
(26,006
|
)
|
||||
Customer-related
|
10 to 21
|
|
285,751
|
|
|
(76,376
|
)
|
|
178,318
|
|
|
(58,148
|
)
|
||||
Unpatented technology
|
10 to 30
|
|
61,867
|
|
|
(12,549
|
)
|
|
45,972
|
|
|
(9,761
|
)
|
||||
Trademarks
|
5 to 20
|
|
19,256
|
|
|
(10,984
|
)
|
|
14,055
|
|
|
(9,151
|
)
|
||||
Trademarks
|
Indefinite
|
|
37,259
|
|
|
—
|
|
|
36,405
|
|
|
—
|
|
||||
Total
|
|
|
$
|
482,421
|
|
|
$
|
(139,245
|
)
|
|
$
|
334,205
|
|
|
$
|
(111,440
|
)
|
Year ended June 30 (in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Cash paid during the period for:
|
|
|
|
|
|
||||||
Interest
|
$
|
29,836
|
|
|
$
|
24,432
|
|
|
$
|
27,395
|
|
Income taxes
|
49,393
|
|
|
51,098
|
|
|
55,728
|
|
|||
|
|
|
|
|
|
||||||
Supplemental disclosure of non-cash information:
|
|
|
|
|
|
||||||
Changes in accounts payable related to purchases of property, plant and equipment
|
2,100
|
|
|
(8,600
|
)
|
|
—
|
|
Year ended June 30 (in thousands)
|
2014
|
|
|
2013
|
|
||
Pro forma (unaudited):
|
|
|
|
||||
Net Sales
|
$
|
2,941,005
|
|
|
$
|
2,902,160
|
|
Net income attributable to Kennametal
|
$
|
175,804
|
|
|
$
|
190,863
|
|
|
|
|
|
||||
Per share data attributable to Kennametal Shareowners :
|
|
|
|
||||
Basic earnings per share
|
$
|
2.23
|
|
|
$
|
2.40
|
|
Diluted earnings per share
|
$
|
2.21
|
|
|
$
|
2.37
|
|
(in thousands)
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Derivatives
(1)
|
$
|
—
|
|
|
$
|
253
|
|
|
$
|
—
|
|
|
$
|
253
|
|
Total assets at fair value
|
$
|
—
|
|
|
$
|
253
|
|
|
$
|
—
|
|
|
$
|
253
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
(1)
|
$
|
—
|
|
|
$
|
1,053
|
|
|
$
|
—
|
|
|
$
|
1,053
|
|
Contingent considerations
|
—
|
|
|
—
|
|
|
14,000
|
|
|
14,000
|
|
||||
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
1,053
|
|
|
$
|
14,000
|
|
|
$
|
15,053
|
|
(in thousands)
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Derivatives
(1)
|
$
|
—
|
|
|
$
|
775
|
|
|
$
|
—
|
|
|
$
|
775
|
|
Total assets at fair value
|
$
|
—
|
|
|
$
|
775
|
|
|
$
|
—
|
|
|
$
|
775
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Derivatives
(1)
|
$
|
—
|
|
|
$
|
530
|
|
|
$
|
—
|
|
|
$
|
530
|
|
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
530
|
|
|
$
|
—
|
|
|
$
|
530
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Derivatives designated as hedging instruments
|
|
|
|
||||
Other current assets - range forward contracts
|
$
|
184
|
|
|
$
|
658
|
|
Other current liabilities - range forward contracts
|
(6
|
)
|
|
(522
|
)
|
||
Other assets - range forward contracts
|
42
|
|
|
69
|
|
||
Total derivatives designated as hedging instruments
|
220
|
|
|
205
|
|
||
Derivatives not designated as hedging instruments
|
|
|
|
||||
Other current assets - currency forward contracts
|
27
|
|
|
48
|
|
||
Other current liabilities - currency forward contracts
|
(1,047
|
)
|
|
(8
|
)
|
||
Total derivatives not designated as hedging instruments
|
(1,020
|
)
|
|
40
|
|
||
Total derivatives
|
$
|
(800
|
)
|
|
$
|
245
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Other expense (income), net - currency forward contracts
|
$
|
1,057
|
|
|
$
|
1,210
|
|
|
$
|
(1,149
|
)
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Losses recognized in other comprehensive loss, net
|
$
|
(702
|
)
|
|
$
|
(611
|
)
|
|
$
|
(11,165
|
)
|
Losses reclassified from accumulated other comprehensive loss into other expense (income), net
|
$
|
1,399
|
|
|
$
|
1,116
|
|
|
$
|
270
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Finished goods
|
$
|
371,599
|
|
|
$
|
303,307
|
|
Work in process and powder blends
|
308,129
|
|
|
244,180
|
|
||
Raw materials
|
126,004
|
|
|
137,602
|
|
||
Inventories at current cost
|
805,732
|
|
|
685,089
|
|
||
Less: LIFO valuation
|
(101,966
|
)
|
|
(106,294
|
)
|
||
Total inventories
|
$
|
703,766
|
|
|
$
|
578,795
|
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
||
Accrued employee benefits
|
|
$
|
27,306
|
|
|
$
|
21,663
|
|
Payroll, state and local taxes
|
|
16,401
|
|
|
14,885
|
|
||
Accrued restructuring (Note 14)
|
|
9,002
|
|
|
—
|
|
||
Other
|
|
106,194
|
|
|
88,199
|
|
||
Total other current liabilities
|
|
$
|
158,903
|
|
|
$
|
124,747
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
2.65% Senior Unsecured Notes due 2019 net of discount of $0.4 million for 2014 and $0.5 million for 2013
|
$
|
399,595
|
|
|
$
|
399,519
|
|
3.875% Senior Unsecured Notes due 2022 net of discount of $0.3 million for 2014 and $0.3 million for 2013
|
299,720
|
|
|
299,683
|
|
||
Credit Agreement:
|
|
|
|
||||
Euro-denominated borrowings, 1.1% to 1.3% in 2014, due 2018
|
200,112
|
|
|
—
|
|
||
U.S. Dollar-denominated borrowings, 1.2% in 2014 and 1.1% in 2013, due 2018
|
87,000
|
|
|
3,600
|
|
||
Capital leases with terms expiring through 2018 at 1.6% to 5.4% in 2014 and
2.3% to 5.4% in 2013
|
2,886
|
|
|
4,553
|
|
||
Other
|
15
|
|
|
9
|
|
||
Total debt and capital leases
|
989,328
|
|
|
707,364
|
|
||
Less current maturities:
|
|
|
|
||||
Long-term debt
|
(7,512
|
)
|
|
(3,600
|
)
|
||
Capital leases
|
(135
|
)
|
|
(129
|
)
|
||
Other
|
(15
|
)
|
|
(9
|
)
|
||
Total current maturities
|
(7,662
|
)
|
|
(3,738
|
)
|
||
Long-term debt and capital leases, less current maturities
|
$
|
981,666
|
|
|
$
|
703,626
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Income before income taxes:
|
|
|
|
|
|
||||||
United States
|
$
|
59,160
|
|
|
$
|
87,499
|
|
|
$
|
95,410
|
|
International
|
169,649
|
|
|
179,110
|
|
|
294,559
|
|
|||
Total income before income taxes
|
$
|
228,809
|
|
|
$
|
266,609
|
|
|
$
|
389,969
|
|
Current income taxes:
|
|
|
|
|
|
||||||
Federal
|
$
|
15,108
|
|
|
$
|
10,645
|
|
|
$
|
23,313
|
|
State
|
896
|
|
|
3,441
|
|
|
2,275
|
|
|||
International
|
27,488
|
|
|
45,375
|
|
|
24,946
|
|
|||
Total current income taxes
|
43,492
|
|
|
59,461
|
|
|
50,534
|
|
|||
Deferred income taxes:
|
|
|
|
|
|
||||||
Federal
|
$
|
10,157
|
|
|
$
|
12,951
|
|
|
$
|
13,637
|
|
State
|
(62
|
)
|
|
2,433
|
|
|
4,104
|
|
|||
International
|
13,024
|
|
|
(15,152
|
)
|
|
10,861
|
|
|||
Total deferred income taxes:
|
23,119
|
|
|
232
|
|
|
28,602
|
|
|||
Provision for income taxes
|
$
|
66,611
|
|
|
$
|
59,693
|
|
|
$
|
79,136
|
|
Effective tax rate
|
29.1
|
%
|
|
22.4
|
%
|
|
20.3
|
%
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Income taxes at U.S. statutory rate
|
$
|
80,083
|
|
|
$
|
93,313
|
|
|
$
|
136,489
|
|
State income taxes, net of federal tax benefits
|
1,593
|
|
|
4,051
|
|
|
4,110
|
|
|||
U.S. income taxes provided on international income
|
2,423
|
|
|
3,067
|
|
|
8,164
|
|
|||
Combined tax effects of international income
|
(22,580
|
)
|
|
(30,692
|
)
|
|
(50,574
|
)
|
|||
Change in valuation allowance and other uncertain tax positions
|
(2,603
|
)
|
|
(4,550
|
)
|
|
(16,243
|
)
|
|||
Impact of domestic production activities deduction
|
(942
|
)
|
|
(3,546
|
)
|
|
(3,810
|
)
|
|||
Research and development credit
|
(1,385
|
)
|
|
(4,141
|
)
|
|
(1,515
|
)
|
|||
Change in indefinite reinvestment assertion
|
7,170
|
|
|
—
|
|
|
—
|
|
|||
Other
|
2,852
|
|
|
2,191
|
|
|
2,515
|
|
|||
Provision for income taxes
|
$
|
66,611
|
|
|
$
|
59,693
|
|
|
$
|
79,136
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
52,812
|
|
|
$
|
50,984
|
|
Inventory valuation and reserves
|
20,612
|
|
|
21,935
|
|
||
Pension benefits
|
2,427
|
|
|
6,402
|
|
||
Other postretirement benefits
|
8,432
|
|
|
9,163
|
|
||
Accrued employee benefits
|
29,034
|
|
|
33,666
|
|
||
Other accrued liabilities
|
12,981
|
|
|
9,368
|
|
||
Hedging activities
|
14,996
|
|
|
13,994
|
|
||
Tax credits and other carryforwards
|
2,082
|
|
|
1,708
|
|
||
Other
|
14,617
|
|
|
20,918
|
|
||
Total
|
157,993
|
|
|
168,138
|
|
||
Valuation allowance
|
(17,860
|
)
|
|
(15,569
|
)
|
||
Total deferred tax assets
|
$
|
140,133
|
|
|
$
|
152,569
|
|
Deferred tax liabilities:
|
|
|
|
||||
Tax depreciation in excess of book
|
$
|
107,171
|
|
|
$
|
107,623
|
|
Intangible assets
|
70,957
|
|
|
64,614
|
|
||
Total deferred tax liabilities
|
$
|
178,128
|
|
|
$
|
172,237
|
|
Total net deferred tax liabilities
|
$
|
(37,995
|
)
|
|
$
|
(19,668
|
)
|
(in thousands)
|
|
2014
|
|
|
2013
|
|
||
Balance at beginning of year
|
|
$
|
26,798
|
|
|
$
|
7,298
|
|
Increases for tax positions of prior years
|
|
1,461
|
|
|
—
|
|
||
Decreases for tax positions of prior years
|
|
(6,982
|
)
|
|
—
|
|
||
Increases for tax positions related to the current year
|
|
116
|
|
|
23,231
|
|
||
Decreases related to settlement with taxing authority
|
|
(2,161
|
)
|
|
(3,813
|
)
|
||
Foreign currency translation
|
|
1,134
|
|
|
82
|
|
||
Balance at end of year
|
|
$
|
20,366
|
|
|
$
|
26,798
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation, beginning of year
|
$
|
890,831
|
|
|
$
|
958,306
|
|
Service cost
|
6,910
|
|
|
7,797
|
|
||
Interest cost
|
41,084
|
|
|
38,183
|
|
||
Participant contributions
|
15
|
|
|
28
|
|
||
Actuarial losses (gains)
|
56,925
|
|
|
(71,974
|
)
|
||
Benefits and expenses paid
|
(43,948
|
)
|
|
(40,898
|
)
|
||
Currency translation adjustments
|
16,994
|
|
|
173
|
|
||
Effect of acquired business
|
1,093
|
|
|
—
|
|
||
Plan settlements
|
—
|
|
|
(784
|
)
|
||
Benefit obligation, end of year
|
$
|
969,904
|
|
|
$
|
890,831
|
|
Change in plans' assets:
|
|
|
|
||||
Fair value of plans' assets, beginning of year
|
$
|
796,079
|
|
|
$
|
783,843
|
|
Actual return on plans' assets
|
108,640
|
|
|
47,660
|
|
||
Company contributions
|
10,902
|
|
|
9,788
|
|
||
Participant contributions
|
15
|
|
|
28
|
|
||
Benefits and expenses paid
|
(43,948
|
)
|
|
(40,898
|
)
|
||
Plan settlements
|
—
|
|
|
(784
|
)
|
||
Currency translation adjustments
|
12,576
|
|
|
(3,558
|
)
|
||
Fair value of plans' assets, end of year
|
$
|
884,264
|
|
|
$
|
796,079
|
|
Funded status of plans
|
$
|
(85,640
|
)
|
|
$
|
(94,752
|
)
|
Amounts recognized in the balance sheet consist of:
|
|
|
|
||||
Long-term prepaid benefit
|
$
|
81,307
|
|
|
$
|
57,385
|
|
Short-term accrued benefit obligation
|
(8,679
|
)
|
|
(9,353
|
)
|
||
Accrued pension benefits
|
(158,268
|
)
|
|
(142,784
|
)
|
||
Net amount recognized
|
$
|
(85,640
|
)
|
|
$
|
(94,752
|
)
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Unrecognized net actuarial losses
|
$
|
121,799
|
|
|
$
|
113,452
|
|
Unrecognized net prior service credits
|
(939
|
)
|
|
(1,498
|
)
|
||
Unrecognized transition obligations
|
1,105
|
|
|
1,101
|
|
||
Total
|
$
|
121,965
|
|
|
$
|
113,055
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Projected benefit obligation
|
$
|
190,679
|
|
|
$
|
184,805
|
|
Accumulated benefit obligation
|
189,391
|
|
|
183,056
|
|
||
Fair value of plan assets
|
23,390
|
|
|
34,405
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Service cost
|
$
|
6,910
|
|
|
$
|
7,797
|
|
|
$
|
6,982
|
|
Interest cost
|
41,084
|
|
|
38,183
|
|
|
42,107
|
|
|||
Expected return on plans' assets
|
(59,527
|
)
|
|
(56,111
|
)
|
|
(51,376
|
)
|
|||
Amortization of transition obligation
|
78
|
|
|
69
|
|
|
65
|
|
|||
Amortization of prior service cost
|
(234
|
)
|
|
(195
|
)
|
|
(186
|
)
|
|||
Settlement loss
|
—
|
|
|
158
|
|
|
1,253
|
|
|||
Recognition of actuarial losses
|
2,642
|
|
|
14,961
|
|
|
8,259
|
|
|||
Net periodic pension (income) cost
|
$
|
(9,047
|
)
|
|
$
|
4,862
|
|
|
$
|
7,104
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation, beginning of year
|
$
|
21,422
|
|
|
$
|
24,574
|
|
Service cost
|
55
|
|
|
72
|
|
||
Interest cost
|
1,006
|
|
|
938
|
|
||
Actuarial losses (gains)
|
3,658
|
|
|
(907
|
)
|
||
Benefits paid
|
(1,665
|
)
|
|
(3,255
|
)
|
||
Benefit obligation, end of year
|
$
|
24,476
|
|
|
$
|
21,422
|
|
Funded status of plan
|
$
|
(24,476
|
)
|
|
$
|
(21,422
|
)
|
Amounts recognized in the balance sheet consist of:
|
|
|
|
||||
Short-term accrued benefit obligation
|
$
|
(1,960
|
)
|
|
$
|
(1,961
|
)
|
Accrued postretirement benefits
|
(22,516
|
)
|
|
(19,461
|
)
|
||
Net amount recognized
|
$
|
(24,476
|
)
|
|
$
|
(21,422
|
)
|
(in thousands)
|
2014
|
|
|
2013
|
|
||
Unrecognized net actuarial losses
|
$
|
8,554
|
|
|
$
|
5,213
|
|
Unrecognized net prior service credits
|
(452
|
)
|
|
(563
|
)
|
||
Total
|
$
|
8,102
|
|
|
$
|
4,650
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Service cost
|
$
|
55
|
|
|
$
|
72
|
|
|
$
|
75
|
|
Interest cost
|
1,006
|
|
|
938
|
|
|
1,029
|
|
|||
Amortization of prior service credit
|
(111
|
)
|
|
(111
|
)
|
|
(89
|
)
|
|||
Recognition of actuarial loss (gains)
|
317
|
|
|
417
|
|
|
(56
|
)
|
|||
Net periodic other postretirement benefit cost
|
$
|
1,267
|
|
|
$
|
1,316
|
|
|
$
|
959
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Discount Rate:
|
|
|
|
|
|
|||
U.S. plans
|
4.4
|
%
|
|
4.9
|
%
|
|
4.0
|
%
|
International plans
|
2.9-4.3%
|
|
|
3.5-4.8%
|
|
|
4.0-5.0%
|
|
Rates of future salary increases:
|
|
|
|
|
|
|||
U.S. plans
|
3.0-5.0%
|
|
|
3.0-5.0%
|
|
|
3.0-5.0%
|
|
International plans
|
2.5-3.0%
|
|
|
2.5-3.0%
|
|
|
2.5-4.0%
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Discount Rate:
|
|
|
|
|
|
|||
U.S. plans
|
4.9
|
%
|
|
4.0
|
%
|
|
5.5
|
%
|
International plans
|
3.5-4.8%
|
|
|
4.0-5.5%
|
|
|
5.5-5.8%
|
|
Rates of future salary increases:
|
|
|
|
|
|
|||
U.S. plans
|
3.0-5.0%
|
|
|
3.0-5.0%
|
|
|
3.0-5.0%
|
|
International plans
|
2.5-3.0%
|
|
|
2.5-4.0%
|
|
|
2.0-3.5%
|
|
Rate of return on plans assets:
|
|
|
|
|
|
|||
U.S. plans
|
8.0
|
%
|
|
8.0
|
%
|
|
8.0
|
%
|
International plans
|
5.0-6.0%
|
|
|
5.6
|
%
|
|
5.8
|
%
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Health care costs trend rate assumed for next year
|
7.5
|
%
|
|
7.8
|
%
|
|
8.1
|
%
|
Rate to which the cost trend rate gradually declines
|
5.0
|
%
|
|
4.5
|
%
|
|
4.5
|
%
|
Year that the rate reaches the rate at which it is assumed to remain
|
2024
|
|
|
2029
|
|
|
2029
|
|
(in thousands)
|
1% Increase
|
|
|
1% Decrease
|
|
||
Effect on total service and interest cost components
|
$
|
50
|
|
|
$
|
(44
|
)
|
Effect on other postretirement obligation
|
1,266
|
|
|
(1,112
|
)
|
|
2014
|
|
|
2013
|
|
|
Target %
|
|
Equity
|
34
|
%
|
|
34
|
%
|
|
30
|
%
|
Fixed Income
|
63
|
%
|
|
61
|
%
|
|
70
|
%
|
Other
|
3
|
%
|
|
5
|
%
|
|
—
|
%
|
(in thousands)
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Corporate fixed income securities
|
$
|
—
|
|
|
$
|
409,167
|
|
|
$
|
—
|
|
|
$
|
409,167
|
|
Common / collective trusts:
|
|
|
|
|
|
|
|
||||||||
Value funds
|
—
|
|
|
117,479
|
|
|
—
|
|
|
117,479
|
|
||||
Growth funds
|
—
|
|
|
64,830
|
|
|
—
|
|
|
64,830
|
|
||||
Balanced funds
|
—
|
|
|
22,262
|
|
|
—
|
|
|
22,262
|
|
||||
Common stock
|
101,527
|
|
|
—
|
|
|
—
|
|
|
101,527
|
|
||||
Government securities:
|
|
|
|
|
|
|
|
||||||||
U.S. Government securities
|
—
|
|
|
66,709
|
|
|
—
|
|
|
66,709
|
|
||||
Foreign government securities
|
—
|
|
|
41,202
|
|
|
—
|
|
|
41,202
|
|
||||
Other fixed income securities
|
—
|
|
|
36,469
|
|
|
—
|
|
|
36,469
|
|
||||
Other
|
3,156
|
|
|
21,463
|
|
|
—
|
|
|
24,619
|
|
||||
Total investments
|
$
|
104,683
|
|
|
$
|
779,581
|
|
|
$
|
—
|
|
|
$
|
884,264
|
|
(in thousands)
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
||||
Corporate fixed income securities
|
$
|
—
|
|
|
$
|
363,027
|
|
|
$
|
—
|
|
|
$
|
363,027
|
|
Common / collective trusts:
|
|
|
|
|
|
|
|
||||||||
Value funds
|
—
|
|
|
105,903
|
|
|
—
|
|
|
105,903
|
|
||||
Growth funds
|
—
|
|
|
57,477
|
|
|
—
|
|
|
57,477
|
|
||||
Balanced funds
|
—
|
|
|
19,370
|
|
|
—
|
|
|
19,370
|
|
||||
Common stock
|
89,420
|
|
|
—
|
|
|
—
|
|
|
89,420
|
|
||||
Government securities:
|
|
|
|
|
|
|
|
||||||||
U.S. Government securities
|
—
|
|
|
54,857
|
|
|
—
|
|
|
54,857
|
|
||||
Foreign government securities
|
—
|
|
|
29,115
|
|
|
—
|
|
|
29,115
|
|
||||
Other fixed income securities
|
—
|
|
|
36,750
|
|
|
—
|
|
|
36,750
|
|
||||
Other
|
1,625
|
|
|
38,535
|
|
|
—
|
|
|
40,160
|
|
||||
Total investments
|
$
|
91,045
|
|
|
$
|
705,034
|
|
|
$
|
—
|
|
|
$
|
796,079
|
|
Attributable to Kennametal:
|
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
||||||||
Balance, June 30, 2013
|
$
|
(83,936
|
)
|
$
|
7,413
|
|
$
|
(12,481
|
)
|
$
|
(89,004
|
)
|
Other comprehensive loss before
reclassifications |
(11,990
|
)
|
31,398
|
|
(706
|
)
|
18,702
|
|
||||
Amounts Reclassified from AOCL
|
2,184
|
|
—
|
|
1,987
|
|
4,171
|
|
||||
Net current period other comprehensive loss
|
(9,806
|
)
|
31,398
|
|
1,281
|
|
22,873
|
|
||||
AOCL, June 30, 2014
|
$
|
(93,742
|
)
|
$
|
38,811
|
|
$
|
(11,200
|
)
|
$
|
(66,131
|
)
|
|
|
|
|
|
||||||||
Attributable to noncontrolling interests:
|
|
|
|
|
||||||||
Balance, June 30, 2013
|
$
|
—
|
|
$
|
721
|
|
$
|
—
|
|
$
|
721
|
|
Other comprehensive loss before
reclassifications |
—
|
|
366
|
|
—
|
|
366
|
|
||||
Net current period other comprehensive loss
|
—
|
|
366
|
|
—
|
|
366
|
|
||||
AOCL, June 30, 2014
|
$
|
—
|
|
$
|
1,087
|
|
$
|
—
|
|
$
|
1,087
|
|
Attributable to Kennametal:
|
Post-retirement benefit plans
|
Currency translation adjustment
|
Derivatives
|
Total
|
||||||||
Balance, June 30, 2012
|
$
|
(132,991
|
)
|
$
|
(4,424
|
)
|
$
|
(13,247
|
)
|
$
|
(150,662
|
)
|
Other comprehensive loss before
reclassifications |
39,376
|
|
9,772
|
|
(611
|
)
|
48,537
|
|
||||
Amounts Reclassified from AOCL
|
9,679
|
|
—
|
|
1,377
|
|
11,056
|
|
||||
Sale of subsidiary stock to noncontrolling
interest
|
—
|
|
2,065
|
|
—
|
|
2,065
|
|
||||
Net current period other comprehensive loss
|
49,055
|
|
11,837
|
|
766
|
|
61,658
|
|
||||
AOCL, June 30, 2013
|
$
|
(83,936
|
)
|
$
|
7,413
|
|
$
|
(12,481
|
)
|
$
|
(89,004
|
)
|
|
|
|
|
|
||||||||
Attributable to noncontrolling interests:
|
|
|
|
|
||||||||
Balance, June 30, 2012
|
$
|
—
|
|
$
|
1,271
|
|
$
|
—
|
|
$
|
1,271
|
|
Other comprehensive loss before
reclassifications |
—
|
|
(550
|
)
|
—
|
|
(550
|
)
|
||||
Net current period other comprehensive loss
|
—
|
|
(550
|
)
|
—
|
|
(550
|
)
|
||||
AOCL, June 30, 2013
|
$
|
—
|
|
$
|
721
|
|
$
|
—
|
|
$
|
721
|
|
Details about AOCL components
(in thousands) |
Year ended June 30, 2014
|
Year ended June 30, 2013
|
Affected line item in the Income Statement
|
||||
Gains and losses on cash flow hedges:
|
|
|
|
||||
Forward starting interest rate swaps
|
$
|
1,945
|
|
$
|
1,872
|
|
Interest expense
|
Currency exchange contracts
|
1,260
|
|
363
|
|
Other expense (income), net
|
||
Total before tax
|
3,205
|
|
2,235
|
|
|
||
Tax benefit
|
1,218
|
|
858
|
|
Provision for income taxes
|
||
Net of tax
|
$
|
1,987
|
|
$
|
1,377
|
|
|
|
|
|
|
||||
Post-retirement benefit plans:
|
|
|
|
||||
Amortization of transition obligations
|
$
|
78
|
|
$
|
69
|
|
See pension note 12
|
Amortization of prior service credit
|
(345
|
)
|
(306
|
)
|
See pension note 12
|
||
Recognition of actuarial losses
|
2,959
|
|
15,378
|
|
See pension note 12
|
||
Total before tax
|
2,692
|
|
15,141
|
|
|
||
Tax (benefit) expense
|
(508
|
)
|
5,462
|
|
Provision for income taxes
|
||
Net of tax
|
$
|
2,184
|
|
$
|
9,679
|
|
|
(in thousands)
|
June 30, 2013
|
|
Expense
|
|
Asset Write-Down
|
|
Translation
|
|
Cash Expenditures
|
|
June 30, 2014
|
||||||||||||
Industrial
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Severance
|
$
|
—
|
|
|
$
|
9,536
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
(3,732
|
)
|
|
$
|
5,815
|
|
Facilities
|
—
|
|
|
2,829
|
|
|
(2,395
|
)
|
|
14
|
|
|
(4
|
)
|
|
444
|
|
||||||
Other
|
—
|
|
|
136
|
|
|
—
|
|
|
13
|
|
|
(82
|
)
|
|
67
|
|
||||||
Total Industrial
|
$
|
—
|
|
|
$
|
12,501
|
|
|
$
|
(2,395
|
)
|
|
$
|
38
|
|
|
$
|
(3,818
|
)
|
|
$
|
6,326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Infrastructure
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Severance
|
$
|
—
|
|
|
$
|
4,034
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
(1,580
|
)
|
|
$
|
2,458
|
|
Facilities
|
—
|
|
|
1,197
|
|
|
(1,013
|
)
|
|
8
|
|
|
(2
|
)
|
|
190
|
|
||||||
Other
|
—
|
|
|
57
|
|
|
—
|
|
|
6
|
|
|
(35
|
)
|
|
28
|
|
||||||
Total Infrastructure
|
$
|
—
|
|
|
5,288
|
|
|
(1,013
|
)
|
|
18
|
|
|
(1,617
|
)
|
|
2,676
|
|
|||||
Total
|
$
|
—
|
|
|
$
|
17,789
|
|
|
$
|
(3,408
|
)
|
|
$
|
56
|
|
|
$
|
(5,435
|
)
|
|
$
|
9,002
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Risk-free interest rate
|
1.3
|
%
|
|
0.6
|
%
|
|
1.1
|
%
|
Expected life (years)
(2)
|
4.5
|
|
|
4.5
|
|
|
4.5
|
|
Expected volatility
(3)
|
40.3
|
%
|
|
49.5
|
%
|
|
47.6
|
%
|
Expected dividend yield
|
1.7
|
%
|
|
1.5
|
%
|
|
1.5
|
%
|
|
Options
|
|
|
Weighted
Average
Exercise Price
|
|
|
Weighted
Average
Remaining
Life (years)
|
|
Aggregate
Intrinsic value
(in thousands)
|
|
||
Options outstanding, June 30, 2013
|
2,729,068
|
|
|
$
|
30.40
|
|
|
|
|
|
||
Granted
|
346,127
|
|
|
45.22
|
|
|
|
|
|
|||
Exercised
|
(769,672
|
)
|
|
26.16
|
|
|
|
|
|
|||
Lapsed and forfeited
|
(40,699
|
)
|
|
39.47
|
|
|
|
|
|
|||
Options outstanding, June 30, 2014
|
2,264,824
|
|
|
$
|
33.95
|
|
|
5.7
|
|
$
|
27,927
|
|
Options vested and expected to vest, June 30, 2014
|
2,236,967
|
|
|
$
|
33.85
|
|
|
5.6
|
|
$
|
27,807
|
|
Options exercisable, June 30, 2014
|
1,475,761
|
|
|
$
|
31.00
|
|
|
4.4
|
|
$
|
22,549
|
|
|
Performance
Vesting
Stock
Units
|
|
|
Performance
Vesting
Weighted
Average Fair
Value
|
|
|
Time Vesting
Stock Units
|
|
|
Time Vesting
Weighted
Average Fair
Value
|
|
||
Unvested performance vesting and time vesting restricted stock units, June 30, 2013
|
367,612
|
|
|
$
|
32.08
|
|
|
815,210
|
|
|
$
|
34.53
|
|
Granted
|
82,449
|
|
|
45.24
|
|
|
312,862
|
|
|
45.17
|
|
||
Vested
|
(156,798
|
)
|
|
26.89
|
|
|
(318,868
|
)
|
|
33.01
|
|
||
Performance metric not achieved
|
(95,907
|
)
|
|
45.24
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
(65,878
|
)
|
|
39.77
|
|
||
Unvested performance vesting and time vesting restricted stock units, June 30, 2014
|
197,356
|
|
|
$
|
40.92
|
|
|
743,326
|
|
|
$
|
39.20
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Sales:
|
|
|
|
|
|
||||||
Industrial
|
$
|
1,524,075
|
|
|
$
|
1,386,690
|
|
|
$
|
1,560,157
|
|
Infrastructure
|
1,313,115
|
|
|
1,202,683
|
|
|
1,176,089
|
|
|||
Total sales
|
$
|
2,837,190
|
|
|
$
|
2,589,373
|
|
|
$
|
2,736,246
|
|
|
|
|
|
|
|
||||||
Operating income:
|
|
|
|
|
|
||||||
Industrial
|
$
|
177,040
|
|
|
$
|
192,828
|
|
|
$
|
278,105
|
|
Infrastructure
|
94,940
|
|
|
111,453
|
|
|
146,768
|
|
|||
Corporate
|
(8,548
|
)
|
|
(7,887
|
)
|
|
(8,464
|
)
|
|||
Total operating income
|
$
|
263,432
|
|
|
$
|
296,394
|
|
|
$
|
416,409
|
|
|
|
|
|
|
|
||||||
Interest expense
|
$
|
32,451
|
|
|
$
|
27,472
|
|
|
$
|
27,215
|
|
Other expense (income), net
|
2,172
|
|
|
2,313
|
|
|
(775
|
)
|
|||
Income before income taxes
|
$
|
228,809
|
|
|
$
|
266,609
|
|
|
$
|
389,969
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization:
|
|
|
|
|
|
||||||
Industrial
|
$
|
65,820
|
|
|
$
|
60,458
|
|
|
$
|
61,422
|
|
Infrastructure
|
64,339
|
|
|
52,583
|
|
|
42,587
|
|
|||
Corporate
|
63
|
|
|
63
|
|
|
64
|
|
|||
Total depreciation and amortization
|
$
|
130,222
|
|
|
$
|
113,104
|
|
|
$
|
104,073
|
|
|
|
|
|
|
|
||||||
Equity income:
|
|
|
|
|
|
||||||
Industrial
|
$
|
34
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Infrastructure
|
50
|
|
|
42
|
|
|
7
|
|
|||
Total equity income
|
$
|
84
|
|
|
$
|
42
|
|
|
$
|
7
|
|
|
|
|
|
|
|
||||||
Total assets:
|
|
|
|
|
|
||||||
Industrial
|
$
|
1,449,688
|
|
|
$
|
1,190,026
|
|
|
$
|
1,256,048
|
|
Infrastructure
|
1,986,724
|
|
|
1,522,470
|
|
|
1,516,033
|
|
|||
Corporate
|
431,674
|
|
|
588,543
|
|
|
262,107
|
|
|||
Total assets
|
$
|
3,868,086
|
|
|
$
|
3,301,039
|
|
|
$
|
3,034,188
|
|
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
|
|
||||||
Industrial
|
$
|
71,628
|
|
|
$
|
47,501
|
|
|
$
|
71,587
|
|
Infrastructure
|
45,748
|
|
|
35,334
|
|
|
31,449
|
|
|||
Total capital expenditures
|
$
|
117,376
|
|
|
$
|
82,835
|
|
|
$
|
103,036
|
|
|
|
|
|
|
|
||||||
Investments in affiliated companies:
|
|
|
|
|
|
||||||
Industrial
|
$
|
—
|
|
|
$
|
234
|
|
|
$
|
251
|
|
Infrastructure
|
495
|
|
|
437
|
|
|
434
|
|
|||
Total investments in affiliated companies
|
$
|
495
|
|
|
$
|
671
|
|
|
$
|
685
|
|
(in thousands)
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||
Sales:
|
|
|
|
|
|
||||||
United States
|
$
|
1,198,541
|
|
|
$
|
1,052,466
|
|
|
$
|
1,170,117
|
|
Germany
|
511,209
|
|
|
454,807
|
|
|
475,076
|
|
|||
China
|
248,212
|
|
|
239,418
|
|
|
214,427
|
|
|||
Italy
|
107,511
|
|
|
94,183
|
|
|
80,520
|
|
|||
United Kingdom
|
105,041
|
|
|
92,614
|
|
|
82,635
|
|
|||
India
|
81,455
|
|
|
83,401
|
|
|
105,136
|
|
|||
Canada
|
78,163
|
|
|
93,257
|
|
|
80,007
|
|
|||
Other
|
507,058
|
|
|
479,227
|
|
|
528,328
|
|
|||
Total sales
|
$
|
2,837,190
|
|
|
$
|
2,589,373
|
|
|
$
|
2,736,246
|
|
|
|
|
|
|
|
||||||
Total assets:
|
|
|
|
|
|
||||||
United States
|
$
|
1,842,453
|
|
|
$
|
1,228,923
|
|
|
$
|
1,177,705
|
|
Germany
|
538,661
|
|
|
646,983
|
|
|
485,442
|
|
|||
China
|
341,949
|
|
|
311,053
|
|
|
281,386
|
|
|||
Switzerland
|
264,928
|
|
|
207,000
|
|
|
216,661
|
|
|||
Italy
|
178,141
|
|
|
172,764
|
|
|
172,513
|
|
|||
Canada
|
133,481
|
|
|
138,959
|
|
|
134,662
|
|
|||
India
|
94,897
|
|
|
94,914
|
|
|
95,618
|
|
|||
United Kingdom
|
79,657
|
|
|
107,738
|
|
|
104,805
|
|
|||
Other
|
393,919
|
|
|
392,705
|
|
|
365,396
|
|
|||
Total assets:
|
$
|
3,868,086
|
|
|
$
|
3,301,039
|
|
|
$
|
3,034,188
|
|
For the quarter ended (in thousands, except
per share data)
|
September 30
|
|
|
December 31
|
|
|
March 31
|
|
|
June 30
|
|
||||
2014
|
|
|
|
|
|
|
|
||||||||
Sales
|
$
|
619,808
|
|
|
$
|
689,936
|
|
|
$
|
755,242
|
|
|
$
|
772,204
|
|
Gross profit
|
198,237
|
|
|
206,971
|
|
|
238,955
|
|
|
252,840
|
|
||||
Net income attributable to Kennametal
|
37,837
|
|
|
24,209
|
|
|
50,865
|
|
|
45,455
|
|
||||
Basic earnings per share attributable to Kennametal
(4)
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.48
|
|
|
0.31
|
|
|
0.65
|
|
|
0.58
|
|
||||
Diluted earnings per share attributable to Kennametal
(4)
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.48
|
|
|
0.30
|
|
|
0.64
|
|
|
0.57
|
|
||||
2013
|
|
|
|
|
|
|
|
||||||||
Sales
|
$
|
629,459
|
|
|
$
|
633,144
|
|
|
$
|
655,360
|
|
|
$
|
671,410
|
|
Gross profit
|
208,348
|
|
|
199,447
|
|
|
208,495
|
|
|
228,714
|
|
||||
Net income attributable to Kennametal
|
46,390
|
|
|
42,142
|
|
|
53,916
|
|
|
60,818
|
|
||||
Basic earnings per share attributable to Kennametal
(4)
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.58
|
|
|
0.53
|
|
|
0.68
|
|
|
0.77
|
|
||||
Diluted earnings per share attributable to Kennametal
(4)
|
|
|
|
|
|
|
|
||||||||
Net income
|
0.57
|
|
|
0.52
|
|
|
0.67
|
|
|
0.76
|
|
(a)
|
Evaluation of Disclosure Controls and Procedures
|
(b)
|
Management’s Report on Internal Control over Financial Reporting
|
(c)
|
Attestation Report of the Independent Registered Public Accounting Firm
|
(d)
|
Changes in Internal Control over Financial Reporting
|
|
|
|
|
|
|
|
|
|
|
|
KENNAMETAL INC.
|
||
Date: August 13, 2014
|
|
|
|
By:
|
|
/s/ Martha Fusco
|
|
|
|
|
|
|
Martha Fusco
|
|
|
|
|
|
|
Vice President Finance and Corporate Controller
|
|
|
|
|
|
SIGNATURE
|
|
TITLE
|
|
DATE
|
|
|
|
||
/s/ CARLOS M. CARDOSO
Carlos M. Cardoso
|
|
Chairman, President and Chief Executive Officer
|
|
August 13, 2014
|
|
|
|
||
/s/ FRANK P. SIMPKINS
Frank P. Simpkins
|
|
Vice President and Chief Financial Officer
|
|
August 13, 2014
|
|
|
|
||
/s/ MARTHA FUSCO
Martha Fusco
|
|
Vice President Finance and Corporate Controller
|
|
August 13, 2014
|
|
|
|
|
|
/s/ CINDY L. DAVIS
Cindy L. Davis
|
|
Director
|
|
August 13, 2014
|
|
|
|
|
|
/s/ RONALD M. DEFEO
Ronald M. DeFeo
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ PHILIP A. DUR
Philip A. Dur
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ WILLIAM J. HARVEY
William J. Harvey
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ TIMOTHY R. MCLEVISH
Timothy R. McLevish
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ WILLIAM R. NEWLIN
William R. Newlin
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ LAWRENCE W. STRANGHOENER
Lawrence W. Stranghoener
|
|
Director
|
|
August 13, 2014
|
|
|
|
||
/s/ STEVEN H. WUNNING
Steven H. Wunning
|
|
Director
|
|
August 13, 2014
|
2
|
|
|
Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession
|
|
|
2.1
|
|
|
Share Sale and Purchase Agreement relating to Deloro Stellite Holdings 1 Limited dated 2012
|
|
Exhibit 2.1 of the Form 10-Q filed February 8, 2012 (File No. 001-05318) is incorporated herein by reference.
|
2.2
|
|
|
Warranty Agreement relating to Deloro Stellite Holdings 1 Limited dated January 13, 2012
|
|
Exhibit 2.2 of the Form 10-Q filed February 8, 2012 (File No. 001-05318) is incorporated herein by reference.
|
2.3
|
|
|
Tax Deed Covenant relating to Deloro Stellite Holdings 1 Limited dated March 1, 2012
|
|
Exhibit 2.1 of the Form 10-Q filed May 9, 2012 (File No. 001-05318) is incorporated herein by reference.
|
2.4
|
|
|
Purchase Agreement relating to the Tungsten Materials Business of Allegheny Technologies Incorporated dated as of September 13, 2013
|
|
Exhibit 2.1 of the Form 10-Q filed November 7, 2013 (File No. 001-05318) is incorporated herein by reference.
|
|
|
|
|
|
|
3
|
|
|
Articles of Incorporation and Bylaws
|
|
|
3.1
|
|
|
Amended and Restated Articles of Incorporation as amended through October 30, 2006
|
|
Exhibit 3.1 of the December 31, 2006 Form 10-Q filed February 9, 2007 (File No. 001-05318) is incorporated herein by reference.
|
3.2
|
|
|
Bylaws of Kennametal Inc. as amended through January 24, 2012
|
|
Exhibit 3.3 of the Form 8-K filed January 26, 2012 (File No. 001-05318) is incorporated herein by reference.
|
|
|
|
|
|
|
4
|
|
|
Instruments Defining the Rights of Security Holders, Including Indentures
|
|
|
4.1
|
|
|
Indenture, dated as of June 19, 2002, by and between the Registrant and Bank One Trust Company, N.A., as trustee
|
|
Exhibit 4.1 of the Form 8-K filed June 20, 2002 (File No. 001-05318) is incorporated herein by reference.
|
4.2
|
|
|
First Supplemental Indenture, dated as of June 19, 2002, by and between the Registrant and Bank One Trust Company, N.A., as trustee
|
|
Exhibit 4.2 of the Form 8-K filed June 20, 2002 (File No. 001-05318) is incorporated herein by reference.
|
4.3
|
|
|
Indenture dated February 14, 2012 between Kennametal Inc. and U.S. Bank National Association
|
|
Exhibit 4.1 of the Form 8-K filed February 14, 2012 (File No. 001-05318) is incorporated herein by reference.
|
4.4
|
|
|
First Supplemental Indenture dated February 14, 2012 between Kennametal Inc. and U.S. Bank National Association (including Form of 3.875% Note due 2022)
|
|
Exhibit 4.2 of the Form 8-K filed February 14, 2012 (File No. 001-05318) is incorporated herein by reference.
|
4.5
|
|
|
Second Supplemental Indenture dated November 7, 2012 between Kennametal Inc. and U.S. Bank National Association (including Form of 2.65% Note due 2019)
|
|
Exhibit 4.4 of the Form 8-K filed November 7, 2012 (File No. 001-05318) is incorporated herein by reference.
|
|
|
|
|
|
|
10
|
|
|
Material Contracts
|
|
|
10.1*
|
|
|
Kennametal Inc. Management Performance Bonus Plan
|
|
Appendix A to the 2011 Proxy Statement filed September 12, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.2*
|
|
|
Deferred Fee Plan for Outside Directors, as amended and restated effective December 30, 2008
|
|
Exhibit 10.1 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.3*
|
|
|
Executive Deferred Compensation Trust Agreement
|
|
Exhibit 10.5 of the June 30, 1988 Form 10-K (File No. 001-05318) is incorporated herein by reference.
|
10.4*
|
|
|
Directors Stock Incentive Plan, as amended and restated effective December 30, 2008
|
|
Exhibit 10.2 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.5*
|
|
|
Performance Bonus Stock Plan of 1995, as amended and restated effective December 30, 2008
|
|
Exhibit 10.3 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.6*
|
|
|
Stock Option and Incentive Plan of 1996
|
|
Exhibit 10.14 of the September 30, 1996 Form 10-Q filed November 13, 1996 (File No. 001-05318) is incorporated herein by reference.
|
10.7*
|
|
|
Kennametal Inc. 1999 Stock Plan
|
|
Exhibit 10.5 of the Form 8-K filed June 11, 1999 (File No. 001-05318) is incorporated herein by reference.
|
10.8*
|
|
|
Kennametal Inc. Stock Option and Incentive Plan of 1999
|
|
Exhibit A of the 1999 Proxy Statement filed September 20, 1999 (File No. 001-05318) is incorporated herein by reference.
|
10.9*
|
|
|
Kennametal Inc. Stock and Incentive Plan of 2002 (as amended on October 21, 2008)
|
|
Appendix A to the 2008 Proxy Statement filed September 8, 2008 (File No. 001-05318) is incorporated herein by reference.
|
10.10*
|
|
|
Forms of Award Agreements under the Kennametal Inc. Stock and Incentive Plan of 2002, as amended
|
|
Exhibit 10.18 of the June 30, 2004 Form 10-K filed September 10, 2004 (File No. 001-05318) is incorporated herein by reference.
|
10.11*
|
|
|
Form of Kennametal Inc. Restriced Unit Award (granted under the Kennametal Inc. Stock and Incentive Plan of 2002, as amended)
|
|
Exhibit 10.1 of the September 30, 2009 Form 10-Q filed November 5, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.12*
|
|
|
Form of Kennametal Inc. Performance Unit Award (granted under the Kennametal Inc. Stock and Incentive Plan of 2002, as amended)
|
|
Exhibit 10.1 of Form 10-Q filed November 5, 2010 (File No. 001-05318) is incorporated herein by reference.
|
10.13*
|
|
|
Form of Employment Agreement with Carlos M Cardoso
|
|
Exhibit 10.9 of the June 30, 2000 Form 10-K filed September 22, 2000 (File No. 001-05318) is incorporated herein by reference.
|
10.14*
|
|
|
Letter Agreement amending Employment Agreement with Carlos M. Cardoso
|
|
Exhibit 10.2 of the Form 8-K filed December 9, 2005 (File No. 001-05318) is incorporated herein by reference.
|
10.15*
|
|
|
Amendment No. 3 to Employment Agreement with Carlos M. Cardoso
|
|
Exhibit 10.5 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.16*
|
|
|
Form of Amended and Restated Employment Agreement with Named Executive Officers (other than Mr. Cardoso)
|
|
Exhibit 10.1 of the December 31, 2006 Form 10-Q filed February 9, 2007 (File No. 001-05318) is incorporated herein by reference.
|
10.17*
|
|
|
Form of Amendment to Amended and Restated Employment Agreement with Named Executive Officers (other than Mr. Cardoso)
|
|
Exhibit 10.6 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.18*
|
|
|
Schedule of Named Executive Officers who have entered into the Form of Amended and Restated Employment Agreement and Form of Amendment as set forth in Exhibits 10.16 and 10.17
|
|
Exhibit 10.19 of the Form 10-K filed August 13, 2013 (File No. 001-05318) is incorporated herein by reference.
|
10.19*
|
|
|
Form of Indemnification Agreement for Named Executive Officers
|
|
Exhibit 10.2 of the Form 8-K filed March 22, 2005 (File No. 001-05318) is incorporated herin by reference.
|
10.20*
|
|
|
Schedule of Named Executive Officers who have entered into the Form of Indemnification Agreement as set forth in Exhibit 10.20
|
|
Exhibit 10.21 of the Form 10-K filed August 13, 2013 (File No. 001-05318) is incorporated herin by reference.
|
10.21*
|
|
|
Kennametal Inc. Executive Retirement Plan (for Designated Others) (as amended effective December 30, 2008)
|
|
Exhibit 10.8 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.22*
|
|
|
Kennametal Inc. Supplemental Executive Retirement Plan (as amended effective December 30, 2008)
|
|
Exhibit 10.9 of the December 31, 2008 Form 10-Q filed February 4, 2009 (File No. 001-05318) is incorporated herein by reference.
|
10.23*
|
|
|
Description of Compensation Payable to Non-Employee Directors
|
|
Exhibit 10.24 of the Form 10-K filed August 13, 2013 (File No. 001-05318) is incorporated herin by reference.
|
10.24
|
|
|
Third Amended and Restated Credit Agreement dated as of June 25, 2010 among Kennametal Inc., Kennametal Europe GmbH, Bank of America, N.A., London Branch (as Euro Swingline Lender), PNC Bank, National Association and JPMorgan Chase Bank, N.A. (as Co-Syndication Agents), Citizens Bank of Pennsylvania and Bank of Tokyo- Mitsubishi UFJ Trust Company (as Co-Documentation Agents), Bank of America, N.A. (as the Administrative Agent), and the following lenders: Bank of America, N.A., PNC Bank, National Association, JPMorgan Chase Bank, N.A., Bank of Tokyo-Mitsubishi UFJ Trust Company, Citizens Bank of Pennsylvania, Mizuho Corporate Bank, Ltd., Comerica Bank, Commerzbank AG New York and Grand Cayman Branches, HSBC Bank USA, National Association, Intesa Sanpaolo S.p.A New York Branch, U.S. Bank National Association, First Commonwealth Bank and TriState Capital Bank
|
|
Exhibit 10.1 of Form 8-K filed June 30, 2010 (File No. 001-05318) is incorporated herein by reference.
|
10.25
|
|
|
Amendment No. 1, dated as of October 21, 2011, to the Third Amended and Restated Credit Agreement by and among Kennametal Inc., Kennametal Europe GmbH, Bank of America, N.A., Bank of America, N.A., London Branch, PNC Bank, National Association, JPMorgan Chase Bank, N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., Citizens Bank of Pennsylvania, Mizuho Corporate Bank, Ltd., HSBC Bank USA, N.A., U.S. Bank National Association, Comerica Bank, Commerzbank AG New York and Grand Cayman Branches,The Huntington National Bank, First Commonwealth Bank and Intesa Sanpaolo S.p.A .
|
|
Exhibit 10.1 of Form 8-K filed October 27, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.26
|
|
|
Amendment No. 2, dated as of April 5, 2013, to the Third Amended and Restated Credit Agreement by and among Kennametal Inc., Kennametal Europe GmbH, Bank of America, N.A., Bank of America, N.A., London Branch, PNC Bank, National Association, JPMorgan Chase Bank, N.A., The Bank of Tokyo-Mitsubishi UFJ, Ltd., Citizens Bank of Pennsylvania, Mizuho Corporate Bank, Ltd., HSBC Bank USA, N.A., U.S. Bank National Association, Commerzbank AG New York and Grand Cayman Branches,The Huntington National Bank, Compass Bank and First Commonwealth Bank.
|
|
Exhibit 10.1 of Form 8-K filed April 11, 2013 (File No. 001-05318) is incorporated herein by reference.
|
10.27
|
|
|
Form of Third Amended and Restated Guarantee (in connection with the Third Amended and Restated Credit Agreement)
|
|
Exhibit 10.26 of Form 10-K filed August 12, 2010 (File No. 001-05318) is incorporated herein by reference.
|
10.28*
|
|
|
Stock and Incentive Plan of 2010
|
|
Exhibit A of the 2010 Proxy Statement filed September 13, 2010 (File No. 001-05318) is incorporated herein by reference.
|
10.29*
|
|
|
Form of Kennametal Inc. Performance Unit Award (granted under the Kennametal Inc. Stock and Incentive Plan of 2010)
|
|
Exhibit 10.2 of Form 10-Q filed February 8, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.30*
|
|
|
Form of Kennametal Inc. Restricted Unit Award (granted under the Kennametal Inc. Stock and Incentive Plan of 2010)
|
|
Exhibit 10.3 of Form 10-Q filed February 8, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.31*
|
|
|
Form of Kennametal Inc. Restricted Unit Award for Non-Employee Directors (granted under the Kennametal Inc. Stock and Incentive Plan of 2010)
|
|
Exhibit 10.4 of Form 10-Q filed February 8, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.32*
|
|
|
Form of Kennametal Inc. Nonstatutory Stock Option Award (granted under the Kennametal Inc. Stock and Incentive Plan of 2010)
|
|
Exhibit 10.5 of Form 10-Q filed February 8, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.33*
|
|
|
Form of Kennametal Inc. Nonstatutory Stock Option Award for Non-Employee Directors (granted under the Kennametal Inc. Stock and Incentive Plan of 2010)
|
|
Exhibit 10.6 of Form 10-Q filed February 8, 2011 (File No. 001-05318) is incorporated herein by reference
|
10.34*
|
|
|
Form of Performance Unit Award (granted under Kennametal Inc. Stock and Incentive Plan 2010)
|
|
Exhibit 10.2 of Form 10-Q filed November 8, 2011 (File No. 001-05318) is incorporated herein by reference
|
10.35*
|
|
|
Form of Officer's Employment Agreement
|
|
Exhibit 10.1 of Form 8-K filed May 13, 2011 (File No. 001-05318) is incorporated herein by reference.
|
10.36*
|
|
|
Schedule of Executive Officers who have entered into the Form of Officer's Employment Agreement as set forth in Exhibit 10.35.
|
|
Filed herewith.
|
(In thousands)
For the year ended June 30
|
|
Balance at
Beginning
of Year
|
|
|
Charges to
Costs and
Expenses
|
|
|
Charged to
Other
Comprehensive
(Loss) Income
|
|
|
Recoveries
|
|
|
Other
Adjustments
|
|
|
|
Deductions
from
Reserves
|
|
|
Balance at
End of Year
|
|
|||||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Allowance for
doubtful accounts
|
|
$
|
11,949
|
|
|
$
|
2,880
|
|
|
$
|
—
|
|
|
$
|
207
|
|
|
$
|
111
|
|
|
(1)
|
$
|
(1,120
|
)
|
(2)
|
$
|
14,027
|
|
Reserve for excess and obsolete inventory
|
|
52,739
|
|
|
9,252
|
|
|
—
|
|
|
—
|
|
|
1,317
|
|
|
(1)
|
(10,571
|
)
|
(3)
|
52,737
|
|
|||||||
Deferred tax asset valuation allowance
|
|
15,569
|
|
|
3,001
|
|
|
24
|
|
|
—
|
|
|
505
|
|
|
(1)
|
(1,239
|
)
|
(4)
|
17,860
|
|
|||||||
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Allowance for
doubtful accounts
|
|
$
|
12,530
|
|
|
$
|
1,532
|
|
|
$
|
—
|
|
|
$
|
193
|
|
|
$
|
55
|
|
|
(1)
|
$
|
(2,361
|
)
|
(2)
|
$
|
11,949
|
|
Reserve for excess and obsolete inventory
|
|
55,042
|
|
|
6,688
|
|
|
—
|
|
|
—
|
|
|
508
|
|
|
(1)
|
(9,499
|
)
|
(3)
|
52,739
|
|
|||||||
Deferred tax asset valuation allowance
|
|
19,502
|
|
|
(148
|
)
|
|
—
|
|
|
—
|
|
|
(2,288
|
)
|
|
(6)
|
(1,497
|
)
|
(4)
|
15,569
|
|
|||||||
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Allowance for
doubtful accounts
|
|
$
|
20,958
|
|
|
$
|
(3,467
|
)
|
|
$
|
—
|
|
|
$
|
306
|
|
|
$
|
(1,260
|
)
|
|
(1)
|
$
|
(4,007
|
)
|
(2)
|
$
|
12,530
|
|
Reserve for excess and obsolete inventory
|
|
55,283
|
|
|
8,115
|
|
|
—
|
|
|
—
|
|
|
(4,130
|
)
|
|
(1)
|
(4,226
|
)
|
(3)
|
55,042
|
|
|||||||
Deferred tax asset valuation allowance
|
|
25,662
|
|
|
(6,970
|
)
|
|
—
|
|
|
—
|
|
|
810
|
|
|
(5)
|
—
|
|
|
19,502
|
|
ADJ. ROIC
|
|||
|
FY15
|
FY16
|
FY17
|
Maximum
|
14%
|
14%
|
14%
|
Target
|
10%
|
10%
|
10%
|
Threshold
|
7%
|
7%
|
7%
|
•
|
If the Company or a member of the Peer Group splits its stock, such company’s TSR will be adjusted for the stock split
|
•
|
If a member of the Peer Group is acquired by another company, the acquired Peer Group company will be removed from the Peer Group for the entire Performance Period
|
•
|
If a member of the Peer Group sells, spins
‐
off, or disposes of a portion of its business representing more than 50% of such Company’s total assets during the Performance Period, such Company will be removed from the Peer Group
|
•
|
If a member of the Peer Group acquires another company, the acquiring Peer Group company will remain in the Peer Group for the Performance Period
|
•
|
If a member of the Peer Group is delisted on all major stock exchanges, such delisted company will be removed from the Peer Group for the entire Performance Period
|
•
|
Members of the Peer Group that file for bankruptcy, liquidation or similar reorganization during the Performance Period will remain in the Peer Group, positioned below the lowest performing nonbankrupt member of the Peer Group
|
Company Name
|
Exchange:Ticker
|
Acuity Brands, Inc.
|
NYSE:AYI
|
AECOM Technology Corporation
|
NYSE:ACM
|
AGCO Corporation
|
NYSE:AGCO
|
Alliant Techsystems Inc.
|
NYSE:ATK
|
AO Smith Corp.
|
NYSE:AOS
|
B/E Aerospace Inc.
|
NasdaqGS:BEAV
|
Carlisle Companies Incorporated
|
NYSE:CSL
|
CLARCOR Inc.
|
NYSE:CLC
|
Crane Co.
|
NYSE:CR
|
Donaldson Company, Inc.
|
NYSE:DCI
|
Esterline Technologies Corp.
|
NYSE:ESL
|
Exelis Inc.
|
NYSE:XLS
|
Fortune Brands Home & Security, Inc.
|
NYSE:FBHS
|
GATX Corp.
|
NYSE:GMT
|
Graco Inc.
|
NYSE:GGG
|
Granite Construction Incorporated
|
NYSE:GVA
|
Harsco Corporation
|
NYSE:HSC
|
Hubbell Inc.
|
NYSE:HUB.B
|
Huntington Ingalls Industries, Inc.
|
NYSE:HII
|
IDEX Corporation
|
NYSE:IEX
|
ITT Corporation
|
NYSE:ITT
|
KBR, Inc.
|
NYSE:KBR
|
Lennox International, Inc.
|
NYSE:LII
|
Lincoln Electric Holdings Inc.
|
NasdaqGS:LECO
|
MSC Industrial Direct Co. Inc.
|
NYSE:MSM
|
Nordson Corporation
|
NasdaqGS:NDSN
|
NOW Inc.
|
NYSE:DNOW
|
Oshkosh Corporation
|
NYSE:OSK
|
Regal Beloit Corporation
|
NYSE:RBC
|
SPX Corporation
|
NYSE:SPW
|
Terex Corp.
|
NYSE:TEX
|
Timken Co.
|
NYSE:TKR
|
Trinity Industries Inc.
|
NYSE:TRN
|
Triumph Group, Inc.
|
NYSE:TGI
|
United Rentals, Inc.
|
NYSE:URI
|
URS Corporation
|
NYSE:URS
|
Valmont Industries, Inc.
|
NYSE:VMI
|
Watsco Inc.
|
NYSE:WSO
|
Westinghouse Air Brake Technologies Corporation
|
NYSE:WAB
|
Woodward, Inc.
|
NasdaqGS:WWD
|
1.
|
I have reviewed this annual report on Form 10-K of Kennametal Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions)
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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August 13, 2014
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/s/ Carlos M. Cardoso
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Carlos M. Cardoso
Chairman, President and Chief Executive Officer
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1.
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I have reviewed this annual report on Form 10-K of Kennametal Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions)
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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August 13, 2014
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/s/ Frank P. Simpkins
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Frank P. Simpkins
Vice President and Chief Financial Officer
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1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Corporation.
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