x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
For the transition period from ________ to _________
|
Delaware
|
|
52-1762325
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
One Technology Park Drive
|
|
|
Westford, Massachusetts
|
|
01886
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
x
|
Accelerated filer
o
|
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
o
|
|
Emerging growth company
o
|
Class
|
|
Outstanding at July 27, 2018
|
Common Stock, $.01 par value
|
|
11,098,493
|
|
|
Page
|
PART I: Financial Information
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
PART II: Other Information
|
||
|
|
|
|
|
|
|
|
June 30,
2018 |
|
December 30,
2017 |
||||
(In thousands, except share and per share amounts)
|
|
|
||||||
Assets
|
|
|
|
|
||||
Current Assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
60,177
|
|
|
$
|
75,425
|
|
Restricted cash (Note 1)
|
|
975
|
|
|
1,421
|
|
||
Accounts receivable, less allowances of $3,120 and $2,879 (Note 1)
|
|
88,223
|
|
|
89,624
|
|
||
Inventories (Note 1)
|
|
96,261
|
|
|
84,933
|
|
||
Unbilled revenues
|
|
2,183
|
|
|
2,374
|
|
||
Other current assets
|
|
15,397
|
|
|
12,246
|
|
||
Total Current Assets
|
|
263,216
|
|
|
266,023
|
|
||
|
|
|
|
|
||||
Property, Plant, and Equipment, at Cost
|
|
167,382
|
|
|
165,231
|
|
||
Less: accumulated depreciation and amortization
|
|
87,495
|
|
|
85,508
|
|
||
Property, Plant, and Equipment, at Cost, Net
|
|
79,887
|
|
|
79,723
|
|
||
|
|
|
|
|
||||
Other Assets
|
|
14,353
|
|
|
14,311
|
|
||
Intangible Assets, Net (Note 1)
|
|
122,242
|
|
|
133,036
|
|
||
Goodwill (Note 1)
|
|
261,488
|
|
|
268,001
|
|
||
Total Assets
|
|
$
|
741,186
|
|
|
$
|
761,094
|
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
|
||||
Current Liabilities:
|
|
|
|
|
||||
Current maturities of long-term obligations (Note 5)
|
|
$
|
665
|
|
|
$
|
696
|
|
Accounts payable
|
|
35,069
|
|
|
35,461
|
|
||
Customer deposits
|
|
41,601
|
|
|
30,103
|
|
||
Accrued payroll and employee benefits
|
|
25,500
|
|
|
29,616
|
|
||
Advanced billings
|
|
11,463
|
|
|
7,316
|
|
||
Other current liabilities
|
|
26,487
|
|
|
29,038
|
|
||
Total Current Liabilities
|
|
140,785
|
|
|
132,230
|
|
||
|
|
|
|
|
||||
Long-Term Obligations (Notes 5 and 13)
|
|
206,231
|
|
|
241,384
|
|
||
Long-Term Deferred Income Taxes
|
|
26,484
|
|
|
29,085
|
|
||
Other Long-Term Liabilities
|
|
26,001
|
|
|
25,891
|
|
||
|
|
|
|
|
||||
Commitments and Contingencies (Note 12)
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
Stockholders' Equity:
|
|
|
|
|
|
|
||
Preferred stock, $.01 par value, 5,000,000 shares authorized; none issued
|
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 150,000,000 shares authorized; 14,624,159 shares issued
|
|
146
|
|
|
146
|
|
||
Capital in excess of par value
|
|
101,842
|
|
|
103,221
|
|
||
Retained earnings
|
|
361,262
|
|
|
342,893
|
|
||
Treasury stock at cost, 3,528,550 and 3,613,838 shares
|
|
(86,464
|
)
|
|
(88,554
|
)
|
||
Accumulated other comprehensive items (Note 8)
|
|
(36,853
|
)
|
|
(26,715
|
)
|
||
Total Kadant Stockholders' Equity
|
|
339,933
|
|
|
330,991
|
|
||
Noncontrolling interest
|
|
1,752
|
|
|
1,513
|
|
||
Total Stockholders' Equity
|
|
341,685
|
|
|
332,504
|
|
||
Total Liabilities and Stockholders' Equity
|
|
$
|
741,186
|
|
|
$
|
761,094
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
(In thousands, except per share amounts)
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Revenues (Notes 1 and 11)
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
|
|
|
|
|
|
|
|
|
||||||||
Costs and Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of revenues
|
|
86,749
|
|
|
57,390
|
|
|
169,863
|
|
|
111,230
|
|
||||
Selling, general, and administrative expenses
|
|
45,132
|
|
|
38,970
|
|
|
90,908
|
|
|
73,590
|
|
||||
Research and development expenses
|
|
2,728
|
|
|
2,222
|
|
|
5,597
|
|
|
4,369
|
|
||||
Restructuring costs (Note 2)
|
|
569
|
|
|
—
|
|
|
1,339
|
|
|
—
|
|
||||
|
|
135,178
|
|
|
98,582
|
|
|
267,707
|
|
|
189,189
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating Income
|
|
19,735
|
|
|
11,660
|
|
|
36,399
|
|
|
23,910
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Interest Income
|
|
122
|
|
|
102
|
|
|
305
|
|
|
206
|
|
||||
Interest Expense
|
|
(1,850
|
)
|
|
(392
|
)
|
|
(3,582
|
)
|
|
(740
|
)
|
||||
Other Expense, Net (Note 7)
|
|
(245
|
)
|
|
(217
|
)
|
|
(491
|
)
|
|
(421
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income Before Provision for Income Taxes
|
|
17,762
|
|
|
11,153
|
|
|
32,631
|
|
|
22,955
|
|
||||
Provision for Income Taxes (Note 4)
|
|
5,271
|
|
|
2,955
|
|
|
9,132
|
|
|
5,690
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net Income
|
|
12,491
|
|
|
8,198
|
|
|
23,499
|
|
|
17,265
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net Income Attributable to Noncontrolling Interest
|
|
(142
|
)
|
|
(102
|
)
|
|
(292
|
)
|
|
(218
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net Income Attributable to Kadant
|
|
$
|
12,349
|
|
|
$
|
8,096
|
|
|
$
|
23,207
|
|
|
$
|
17,047
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per Share Attributable to Kadant (Note 3):
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
1.11
|
|
|
$
|
0.74
|
|
|
$
|
2.10
|
|
|
$
|
1.55
|
|
Diluted
|
|
$
|
1.08
|
|
|
$
|
0.72
|
|
|
$
|
2.04
|
|
|
$
|
1.52
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted Average Shares (Note 3):
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
11,092
|
|
|
11,001
|
|
|
11,067
|
|
|
10,976
|
|
||||
Diluted
|
|
11,400
|
|
|
11,296
|
|
|
11,371
|
|
|
11,250
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Cash Dividends Declared per Common Share
|
|
$
|
0.22
|
|
|
$
|
0.21
|
|
|
$
|
0.44
|
|
|
$
|
0.42
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
(In thousands)
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Net Income
|
|
$
|
12,491
|
|
|
$
|
8,198
|
|
|
$
|
23,499
|
|
|
$
|
17,265
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other Comprehensive Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Foreign currency translation adjustment
|
|
(15,776
|
)
|
|
8,655
|
|
|
(10,440
|
)
|
|
13,687
|
|
||||
Pension and other post-retirement liability adjustments (net of tax provision of $75, $11, $109 and $60)
|
|
212
|
|
|
81
|
|
|
329
|
|
|
163
|
|
||||
Deferred (loss) gain on cash flow hedges (net of tax (benefit) provision of ($55), $1, ($47) and $16)
|
|
(173
|
)
|
|
7
|
|
|
(80
|
)
|
|
34
|
|
||||
Other Comprehensive Items
|
|
(15,737
|
)
|
|
8,743
|
|
|
(10,191
|
)
|
|
13,884
|
|
||||
Comprehensive (Loss) Income
|
|
(3,246
|
)
|
|
16,941
|
|
|
13,308
|
|
|
31,149
|
|
||||
Comprehensive Income Attributable to Noncontrolling Interest
|
|
(46
|
)
|
|
(219
|
)
|
|
(239
|
)
|
|
(381
|
)
|
||||
Comprehensive (Loss) Income Attributable to Kadant
|
|
$
|
(3,292
|
)
|
|
$
|
16,722
|
|
|
$
|
13,069
|
|
|
$
|
30,768
|
|
|
|
Six Months Ended
|
||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
||||
(In thousands)
|
|
|
||||||
|
|
|
|
|
||||
Operating Activities
|
|
|
|
|
||||
Net income attributable to Kadant
|
|
$
|
23,207
|
|
|
$
|
17,047
|
|
Net income attributable to noncontrolling interest
|
|
292
|
|
|
218
|
|
||
Net income
|
|
23,499
|
|
|
17,265
|
|
||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
11,943
|
|
|
6,531
|
|
||
Stock-based compensation expense
|
|
3,610
|
|
|
2,736
|
|
||
Provision for losses on accounts receivable
|
|
438
|
|
|
84
|
|
||
Loss on the sale of property, plant, and equipment
|
|
54
|
|
|
30
|
|
||
Other items, net
|
|
(869
|
)
|
|
2,161
|
|
||
Contributions to U.S. pension plan
|
|
—
|
|
|
(540
|
)
|
||
Changes in current assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
|
||
Accounts receivable
|
|
(974
|
)
|
|
(476
|
)
|
||
Unbilled revenues
|
|
2,228
|
|
|
(2,968
|
)
|
||
Inventories
|
|
(14,238
|
)
|
|
(6,147
|
)
|
||
Other current assets
|
|
(2,781
|
)
|
|
(2,652
|
)
|
||
Accounts payable
|
|
4,039
|
|
|
3,363
|
|
||
Other current liabilities
|
|
8,622
|
|
|
5,989
|
|
||
Net cash provided by operating activities
|
|
35,571
|
|
|
25,376
|
|
||
|
|
|
|
|
||||
Investing Activities
|
|
|
|
|
|
|
||
Purchases of property, plant, and equipment
|
|
(10,211
|
)
|
|
(3,435
|
)
|
||
Proceeds from sale of property, plant, and equipment
|
|
213
|
|
|
50
|
|
||
Acquisition
|
|
—
|
|
|
(165
|
)
|
||
Net cash used in investing activities
|
|
(9,998
|
)
|
|
(3,550
|
)
|
||
|
|
|
|
|
||||
Financing Activities
|
|
|
|
|
|
|
||
Repayment of debt
|
|
(46,838
|
)
|
|
(11,235
|
)
|
||
Proceeds from issuance of debt
|
|
16,000
|
|
|
8,000
|
|
||
Dividends paid
|
|
(4,756
|
)
|
|
(4,388
|
)
|
||
Tax withholding payments related to stock-based compensation
|
|
(3,641
|
)
|
|
(2,206
|
)
|
||
Proceeds from issuance of Company common stock
|
|
742
|
|
|
—
|
|
||
Payment of debt issuance costs
|
|
—
|
|
|
(1,147
|
)
|
||
Other financing activities
|
|
(258
|
)
|
|
(215
|
)
|
||
Net cash used in financing activities
|
|
(38,751
|
)
|
|
(11,191
|
)
|
||
|
|
|
|
|
||||
Exchange Rate Effect on Cash, Cash Equivalents, and Restricted Cash
|
|
(2,516
|
)
|
|
3,777
|
|
||
|
|
|
|
|
||||
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash
|
|
(15,694
|
)
|
|
14,412
|
|
||
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period
|
|
76,846
|
|
|
73,569
|
|
||
Cash, Cash Equivalents, and Restricted Cash at End of Period
|
|
$
|
61,152
|
|
|
$
|
87,981
|
|
(In thousands, except share amounts)
|
|
Common
Stock
|
|
Capital in
Excess of Par Value
|
|
Retained Earnings
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive Items
|
|
Noncontrolling Interest
|
|
Total
Stockholders' Equity
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at December 31, 2016
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
101,405
|
|
|
$
|
321,050
|
|
|
3,686,532
|
|
|
$
|
(90,335
|
)
|
|
$
|
(49,637
|
)
|
|
$
|
1,650
|
|
|
$
|
284,279
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,047
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
218
|
|
|
17,265
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Dividends declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,621
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,621
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(1,104
|
)
|
|
—
|
|
|
(66,694
|
)
|
|
1,634
|
|
|
—
|
|
|
—
|
|
|
530
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,721
|
|
|
163
|
|
|
13,884
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at July 1, 2017
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
100,301
|
|
|
$
|
333,476
|
|
|
3,619,838
|
|
|
$
|
(88,701
|
)
|
|
$
|
(35,916
|
)
|
|
$
|
2,031
|
|
|
$
|
311,337
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at December 30, 2017
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
103,221
|
|
|
$
|
342,893
|
|
|
3,613,838
|
|
|
$
|
(88,554
|
)
|
|
$
|
(26,715
|
)
|
|
$
|
1,513
|
|
|
$
|
332,504
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,207
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
292
|
|
|
23,499
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adoption of ASU No. 2014-09 (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
119
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Adoption of ASU No. 2016-16 (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Dividends declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,882
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,882
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(1,379
|
)
|
|
—
|
|
|
(85,288
|
)
|
|
2,090
|
|
|
—
|
|
|
—
|
|
|
711
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,138
|
)
|
|
(53
|
)
|
|
(10,191
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at June 30, 2018
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
101,842
|
|
|
$
|
361,262
|
|
|
3,528,550
|
|
|
$
|
(86,464
|
)
|
|
$
|
(36,853
|
)
|
|
$
|
1,752
|
|
|
$
|
341,685
|
|
|
|
Six Months Ended
|
||||||
(In thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
||||
Cash Paid for Interest
|
|
$
|
4,268
|
|
|
$
|
366
|
|
Cash Paid for Income Taxes, Net of Refunds
|
|
$
|
14,808
|
|
|
$
|
7,076
|
|
|
|
|
|
|
||||
Non-Cash Investing Activities:
|
|
|
|
|
|
|
||
Estimated post-closing adjustment (a)
|
|
$
|
237
|
|
|
$
|
—
|
|
|
|
|
|
|
||||
Non-cash additions to property, plant and equipment
|
|
$
|
1,033
|
|
|
$
|
390
|
|
|
|
|
|
|
||||
Non-Cash Financing Activities:
|
|
|
|
|
|
|
||
Issuance of Company common stock upon vesting of restricted stock units
|
|
$
|
3,264
|
|
|
$
|
2,814
|
|
Dividends declared but unpaid
|
|
$
|
2,442
|
|
|
$
|
2,311
|
|
(In thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
December 30,
2017 |
|
December 31,
2016 |
||||||||
Cash and cash equivalents
|
|
$
|
60,177
|
|
|
$
|
85,840
|
|
|
$
|
75,425
|
|
|
$
|
71,487
|
|
Restricted cash
|
|
975
|
|
|
2,141
|
|
|
1,421
|
|
|
2,082
|
|
||||
Total Cash, Cash Equivalents, and Restricted Cash
|
|
$
|
61,152
|
|
|
$
|
87,981
|
|
|
$
|
76,846
|
|
|
$
|
73,569
|
|
|
|
June 30,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Raw Materials and Supplies
|
|
$
|
45,522
|
|
|
$
|
38,952
|
|
Work in Process
|
|
24,722
|
|
|
18,203
|
|
||
Finished Goods
|
|
26,017
|
|
|
27,778
|
|
||
|
|
$
|
96,261
|
|
|
$
|
84,933
|
|
(In thousands)
|
|
Gross
|
|
Currency
Translation |
|
Accumulated
Amortization |
|
Net
|
||||||||
June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
113,283
|
|
|
$
|
(3,058
|
)
|
|
$
|
(33,555
|
)
|
|
$
|
76,670
|
|
Product technology
|
|
46,501
|
|
|
(1,351
|
)
|
|
(21,733
|
)
|
|
23,417
|
|
||||
Tradenames
|
|
5,227
|
|
|
(345
|
)
|
|
(1,747
|
)
|
|
3,135
|
|
||||
Other
|
|
13,744
|
|
|
(96
|
)
|
|
(11,277
|
)
|
|
2,371
|
|
||||
|
|
178,755
|
|
|
(4,850
|
)
|
|
(68,312
|
)
|
|
105,593
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
16,600
|
|
|
49
|
|
|
—
|
|
|
16,649
|
|
||||
Acquired Intangible Assets
|
|
$
|
195,355
|
|
|
$
|
(4,801
|
)
|
|
$
|
(68,312
|
)
|
|
$
|
122,242
|
|
|
|
|
|
|
|
|
|
|
(In thousands)
|
|
Gross
|
|
Currency
Translation |
|
Accumulated
Amortization |
|
Net
|
||||||||
December 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
113,301
|
|
|
$
|
(621
|
)
|
|
$
|
(28,789
|
)
|
|
$
|
83,891
|
|
Product technology
|
|
46,501
|
|
|
(737
|
)
|
|
(19,841
|
)
|
|
25,923
|
|
||||
Tradenames
|
|
5,227
|
|
|
(262
|
)
|
|
(1,504
|
)
|
|
3,461
|
|
||||
Other
|
|
13,754
|
|
|
(35
|
)
|
|
(10,863
|
)
|
|
2,856
|
|
||||
|
|
178,783
|
|
|
(1,655
|
)
|
|
(60,997
|
)
|
|
116,131
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
16,600
|
|
|
305
|
|
|
—
|
|
|
16,905
|
|
||||
Acquired Intangible Assets
|
|
$
|
195,383
|
|
|
$
|
(1,350
|
)
|
|
$
|
(60,997
|
)
|
|
$
|
133,036
|
|
(In thousands)
|
|
Papermaking Systems Segment
|
|
Wood Processing Systems Segment
|
|
Total
|
||||||
Balance at December 30, 2017
|
|
|
|
|
|
|
||||||
Gross balance
|
|
$
|
247,014
|
|
|
$
|
106,496
|
|
|
$
|
353,510
|
|
Accumulated impairment losses
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
|||
Net balance
|
|
161,505
|
|
|
106,496
|
|
|
268,001
|
|
|||
2018 Adjustments
|
|
|
|
|
|
|
||||||
Acquisitions (a)
|
|
(282
|
)
|
|
(75
|
)
|
|
(357
|
)
|
|||
Currency translation
|
|
(3,280
|
)
|
|
(2,876
|
)
|
|
(6,156
|
)
|
|||
Total 2018 adjustments
|
|
(3,562
|
)
|
|
(2,951
|
)
|
|
(6,513
|
)
|
|||
Balance at June 30, 2018
|
|
|
|
|
|
|
|
|
|
|||
Gross balance
|
|
243,452
|
|
|
103,545
|
|
|
346,997
|
|
|||
Accumulated impairment losses
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
|||
Net balance
|
|
$
|
157,943
|
|
|
$
|
103,545
|
|
|
$
|
261,488
|
|
|
|
Six Months Ended
|
||||||
(In thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
||||
Balance at December 30, 2017
|
|
$
|
5,498
|
|
|
$
|
3,843
|
|
Provision charged to expense
|
|
1,656
|
|
|
1,209
|
|
||
Usage
|
|
(881
|
)
|
|
(1,056
|
)
|
||
Currency translation
|
|
(192
|
)
|
|
224
|
|
||
Balance at June 30, 2018
|
|
$
|
6,081
|
|
|
$
|
4,220
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
|
|
July 1,
|
|
June 30,
|
|
July 1,
|
||||||||
(In thousands)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues by Product Line:
|
|
|
|
|
|
|
|
|
||||||||
Papermaking Systems:
|
|
|
|
|
|
|
|
|
||||||||
Stock-Preparation
|
|
$
|
56,376
|
|
|
$
|
46,178
|
|
|
$
|
101,859
|
|
|
$
|
87,331
|
|
Doctoring, Cleaning, & Filtration
|
|
29,543
|
|
|
27,033
|
|
|
56,765
|
|
|
52,383
|
|
||||
Fluid-Handling
|
|
32,531
|
|
|
22,520
|
|
|
65,417
|
|
|
44,567
|
|
||||
Papermaking Systems
|
|
$
|
118,450
|
|
|
$
|
95,731
|
|
|
$
|
224,041
|
|
|
$
|
184,281
|
|
Wood Processing Systems
|
|
33,152
|
|
|
11,393
|
|
|
72,293
|
|
|
21,336
|
|
||||
Fiber-based Products
|
|
3,311
|
|
|
3,118
|
|
|
7,772
|
|
|
7,482
|
|
||||
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
Revenues by Product Type:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Parts and Consumables
|
|
$
|
94,857
|
|
|
$
|
70,040
|
|
|
$
|
190,842
|
|
|
$
|
140,484
|
|
Capital
|
|
60,056
|
|
|
40,202
|
|
|
113,264
|
|
|
72,615
|
|
||||
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
Revenues by Geography:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
North America
|
|
$
|
75,375
|
|
|
$
|
51,557
|
|
|
$
|
152,991
|
|
|
$
|
101,723
|
|
Europe
|
|
45,032
|
|
|
33,952
|
|
|
86,525
|
|
|
66,703
|
|
||||
Asia
|
|
25,502
|
|
|
16,545
|
|
|
45,650
|
|
|
28,443
|
|
||||
Rest of World
|
|
9,004
|
|
|
8,188
|
|
|
18,940
|
|
|
16,230
|
|
||||
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
|
June 30,
|
|
June 30,
|
||||
(In thousands)
|
|
2018
|
|
2018
|
||||
Timing of Revenue Recognition:
|
|
|
|
|
|
|
||
Point in Time
|
|
$
|
145,998
|
|
|
$
|
288,003
|
|
Over Time
|
|
8,915
|
|
|
16,103
|
|
||
|
|
$
|
154,913
|
|
|
$
|
304,106
|
|
|
|
June 30,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Balances from Contracts with Customers:
|
|
|
|
|
||||
Accounts receivable
|
|
$
|
88,223
|
|
|
$
|
89,624
|
|
Contract assets
|
|
2,183
|
|
|
2,374
|
|
||
Contract liabilities
|
|
54,525
|
|
|
38,702
|
|
(In thousands)
|
|
Severance
|
|
Relocation
|
|
Other (a)
|
|
Total
|
||||||||
Balance at December 30, 2017
|
|
$
|
203
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
203
|
|
(Reversal) provision
|
|
(55
|
)
|
|
1,018
|
|
|
376
|
|
|
1,339
|
|
||||
Usage
|
|
—
|
|
|
(1,015
|
)
|
|
(356
|
)
|
|
(1,371
|
)
|
||||
Currency translation
|
|
(11
|
)
|
|
(3
|
)
|
|
—
|
|
|
(14
|
)
|
||||
Balance at June 30, 2018
|
|
$
|
137
|
|
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
157
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
||||||||
(In thousands, except per share amounts)
|
|
|
|
|
||||||||||||
Amounts Attributable to Kadant:
|
|
|
|
|
|
|
|
|
||||||||
Net Income
|
|
$
|
12,349
|
|
|
$
|
8,096
|
|
|
$
|
23,207
|
|
|
$
|
17,047
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic Weighted Average Shares
|
|
11,092
|
|
|
11,001
|
|
|
11,067
|
|
|
10,976
|
|
||||
Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares
|
|
308
|
|
|
295
|
|
|
304
|
|
|
274
|
|
||||
Diluted Weighted Average Shares
|
|
11,400
|
|
|
11,296
|
|
|
11,371
|
|
|
11,250
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic Earnings per Share
|
|
$
|
1.11
|
|
|
$
|
0.74
|
|
|
$
|
2.10
|
|
|
$
|
1.55
|
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted Earnings per Share
|
|
$
|
1.08
|
|
|
$
|
0.72
|
|
|
$
|
2.04
|
|
|
$
|
1.52
|
|
|
|
June 30,
2018 |
|
December 30,
2017 |
||||
(In thousands)
|
|
|
||||||
Revolving Credit Facility, due 2022
|
|
$
|
202,205
|
|
|
$
|
237,011
|
|
Obligations Under Capital Lease, due 2018 to 2022
|
|
4,362
|
|
|
4,633
|
|
||
Other Borrowings, due 2018 to 2023
|
|
329
|
|
|
436
|
|
||
Total
|
|
206,896
|
|
|
242,080
|
|
||
Less: Current Maturities of Long-Term Obligations
|
|
(665
|
)
|
|
(696
|
)
|
||
Long-Term Obligations
|
|
$
|
206,231
|
|
|
$
|
241,384
|
|
(In thousands)
|
|
Foreign
Currency
Translation
Adjustment
|
|
Unrecognized
Prior Service
Cost on
Retirement Benefit Plans
|
|
Net Actuarial Loss on Retirement Benefit Plans
|
|
Deferred Gain (Loss)
on Cash Flow Hedges
|
|
Total
|
||||||||||
Balance at December 30, 2017
|
|
$
|
(17,501
|
)
|
|
$
|
(319
|
)
|
|
$
|
(8,974
|
)
|
|
$
|
79
|
|
|
$
|
(26,715
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(10,387
|
)
|
|
1
|
|
|
14
|
|
|
(79
|
)
|
|
(10,451
|
)
|
|||||
Reclassifications from AOCI
|
|
—
|
|
|
36
|
|
|
278
|
|
|
(1
|
)
|
|
313
|
|
|||||
Net current period other comprehensive (loss) income
|
|
(10,387
|
)
|
|
37
|
|
|
292
|
|
|
(80
|
)
|
|
(10,138
|
)
|
|||||
Balance at June 30, 2018
|
|
$
|
(27,888
|
)
|
|
$
|
(282
|
)
|
|
$
|
(8,682
|
)
|
|
$
|
(1
|
)
|
|
$
|
(36,853
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
||||||||||||
(In thousands)
|
|
June 30,
2018 |
|
July 1,
2017 |
|
June 30,
2018 |
|
July 1,
2017 |
|
Statement of Income
Line Item
|
||||||||
Retirement Benefit Plans: (a)
|
|
|
|
|
|
|
||||||||||||
Recognized net actuarial loss
|
|
$
|
(184
|
)
|
|
$
|
(144
|
)
|
|
$
|
(369
|
)
|
|
$
|
(279
|
)
|
|
Other expense, net
|
Amortization of prior service cost
|
|
(24
|
)
|
|
(37
|
)
|
|
(48
|
)
|
|
(72
|
)
|
|
Other expense, net
|
||||
Total expense before income taxes
|
|
(208
|
)
|
|
(181
|
)
|
|
(417
|
)
|
|
(351
|
)
|
|
|
||||
Income tax benefit
|
|
51
|
|
|
64
|
|
|
103
|
|
|
123
|
|
|
Provision for income taxes
|
||||
|
|
(157
|
)
|
|
(117
|
)
|
|
(314
|
)
|
|
(228
|
)
|
|
|
||||
Cash Flow Hedges: (b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap agreements
|
|
(17
|
)
|
|
(6
|
)
|
|
(22
|
)
|
|
(18
|
)
|
|
Interest expense
|
||||
Forward currency-exchange contracts
|
|
24
|
|
|
—
|
|
|
24
|
|
|
(11
|
)
|
|
Cost of revenues
|
||||
Total income (expense) before income taxes
|
|
7
|
|
|
(6
|
)
|
|
2
|
|
|
(29
|
)
|
|
|
||||
Income tax (provision) benefit
|
|
(2
|
)
|
|
3
|
|
|
(1
|
)
|
|
11
|
|
|
Provision for income taxes
|
||||
|
|
5
|
|
|
(3
|
)
|
|
1
|
|
|
(18
|
)
|
|
|
||||
Total Reclassifications
|
|
$
|
(152
|
)
|
|
$
|
(120
|
)
|
|
$
|
(313
|
)
|
|
$
|
(246
|
)
|
|
|
(a)
|
Included in the computation of net periodic benefit cost. See
Note 7
for additional information.
|
(b)
|
See
Note 9
for additional information.
|
|
|
|
|
June 30, 2018
|
|
December 30, 2017
|
||||||||||||
|
|
Balance Sheet Location
|
|
Asset (Liability) (a)
|
|
Notional Amount (b)
|
|
Asset (Liability) (a)
|
|
Notional Amount
|
||||||||
(In thousands)
|
|
|
|
|
|
|||||||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||
Derivatives in an Asset Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
2015 Swap Agreement (c)
|
|
Other Long-Term Assets
|
|
$
|
209
|
|
|
$
|
10,000
|
|
|
$
|
126
|
|
|
$
|
10,000
|
|
Derivatives in a Liability Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
2018 Swap Agreement (c)
|
|
Other Long-Term Liabilities
|
|
$
|
(210
|
)
|
|
$
|
15,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Derivatives in an Asset Position:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
Other Current Assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
1,244
|
|
Derivatives in a Liability Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contracts
|
|
Other Current Liabilities
|
|
$
|
(52
|
)
|
|
$
|
2,712
|
|
|
$
|
(16
|
)
|
|
$
|
2,049
|
|
(a)
|
See
Note 10
for the fair value measurements relating to these financial instruments.
|
(b)
|
The total 2018 notional amounts are indicative of the level of the Company's recurring derivative activity.
|
(c)
|
The asset or liability balance represents the settlement value received from or paid to the counterparty in the event of early termination.
|
(In thousands)
|
|
Interest Rate Swap
Agreements
|
|
Forward Currency-
Exchange
Contracts
|
|
Total
|
||||||
Unrealized Gain, Net of Tax, at December 30, 2017
|
|
$
|
79
|
|
|
$
|
—
|
|
|
$
|
79
|
|
Loss (gain) reclassified to earnings (a)
|
|
17
|
|
|
(18
|
)
|
|
(1
|
)
|
|||
(Loss) gain recognized in AOCI
|
|
(97
|
)
|
|
18
|
|
|
(79
|
)
|
|||
Unrealized Loss, Net of Tax, at June 30, 2018
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
•
|
Level 1—Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
|
•
|
Level 3—Unobservable inputs based on the Company's own assumptions.
|
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
3,579
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,579
|
|
2015 Swap Agreement
|
|
$
|
—
|
|
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
209
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
10,735
|
|
|
$
|
—
|
|
|
$
|
10,735
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
52
|
|
|
$
|
—
|
|
|
$
|
52
|
|
2018 Swap Agreement
|
|
$
|
—
|
|
|
$
|
210
|
|
|
$
|
—
|
|
|
$
|
210
|
|
December 30, 2017
|
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
17,728
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,728
|
|
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
17
|
|
2015 Swap Agreement
|
|
$
|
—
|
|
|
$
|
126
|
|
|
$
|
—
|
|
|
$
|
126
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
15,960
|
|
|
$
|
—
|
|
|
$
|
15,960
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
16
|
|
(a)
|
Included in accounts receivable in the accompanying condensed consolidated balance sheet.
|
|
|
June 30, 2018
|
|
December 30, 2017
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
(In thousands)
|
|
|
|
|
||||||||||||
Long-term Debt Obligations:
|
|
|
|
|
|
|
|
|
||||||||
Revolving credit facility
|
|
$
|
202,205
|
|
|
$
|
202,205
|
|
|
$
|
237,011
|
|
|
$
|
237,011
|
|
Capital lease obligations
|
|
3,843
|
|
|
3,843
|
|
|
4,101
|
|
|
4,101
|
|
||||
Other borrowings
|
|
183
|
|
|
183
|
|
|
272
|
|
|
272
|
|
||||
|
|
$
|
206,231
|
|
|
$
|
206,231
|
|
|
$
|
241,384
|
|
|
$
|
241,384
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30,
|
|
July 1,
|
|
June 30,
|
|
July 1,
|
||||||||
(In thousands)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Papermaking Systems (a)
|
|
$
|
118,450
|
|
|
$
|
95,731
|
|
|
$
|
224,041
|
|
|
$
|
184,281
|
|
Wood Processing Systems (b)
|
|
33,152
|
|
|
11,393
|
|
|
72,293
|
|
|
21,336
|
|
||||
Fiber-based Products
|
|
3,311
|
|
|
3,118
|
|
|
7,772
|
|
|
7,482
|
|
||||
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
|
|
|
|
|
|
|
|
|
||||||||
Income Before Provision for Income Taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Papermaking Systems (c)
|
|
$
|
20,899
|
|
|
$
|
17,264
|
|
|
$
|
35,483
|
|
|
$
|
31,563
|
|
Wood Processing Systems (d)
|
|
5,313
|
|
|
(411
|
)
|
|
12,676
|
|
|
2,093
|
|
||||
Corporate and Fiber-based Products (e)
|
|
(6,477
|
)
|
|
(5,193
|
)
|
|
(11,760
|
)
|
|
(9,746
|
)
|
||||
Total operating income
|
|
19,735
|
|
|
11,660
|
|
|
36,399
|
|
|
23,910
|
|
||||
Interest expense, net (f)
|
|
(1,728
|
)
|
|
(290
|
)
|
|
(3,277
|
)
|
|
(534
|
)
|
||||
Other expense, net
|
|
(245
|
)
|
|
(217
|
)
|
|
(491
|
)
|
|
(421
|
)
|
||||
|
|
$
|
17,762
|
|
|
$
|
11,153
|
|
|
$
|
32,631
|
|
|
$
|
22,955
|
|
|
|
|
|
|
|
|
|
|
||||||||
Capital Expenditures:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Papermaking Systems
|
|
$
|
3,840
|
|
|
$
|
1,293
|
|
|
$
|
8,489
|
|
|
$
|
2,777
|
|
Wood Processing Systems
|
|
1,184
|
|
|
105
|
|
|
1,560
|
|
|
291
|
|
||||
Other
|
|
36
|
|
|
315
|
|
|
162
|
|
|
367
|
|
||||
|
|
$
|
5,060
|
|
|
$
|
1,713
|
|
|
$
|
10,211
|
|
|
$
|
3,435
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Includes $
5,430,000
in the three-month period ended
June 30, 2018
and $
11,330,000
in the
six
-month period ended
June 30, 2018
from 2017 acquisitions.
|
|
-
|
Stock-Preparation: custom-engineered systems and equipment, as well as standard individual components, for baling, pulping, de-inking, screening, cleaning, and refining primarily recycled fiber for preparation for entry into the paper machine, and recausticizing and evaporation equipment and systems used in the production of virgin pulp. Our baling equipment is also used to compress a variety of other secondary materials to prepare them for transport or storage;
|
|
-
|
Doctoring, Cleaning, & Filtration: doctoring, cleaning, and filtration systems and related consumables that keep paper machines and other industrial processes running efficiently; doctor blades made of a variety of materials to perform functions including cleaning, creping, web removal, flaking, and the application of coatings; and systems and equipment used to continuously clean fabrics and rolls, drain water from pulp mixtures, form the sheet or web, and filter the process water for reuse. Doctoring and cleaning systems are also used in other process industries such as carbon fiber, textiles and food processing; and
|
|
-
|
Fluid-Handling: rotary joints, precision unions, steam and condensate systems, components, and controls used to transfer fluids, power, and data in numerous process industries and expansion joints used in industrial piping systems.
|
|
-
|
Debarkers: ring and rotary debarkers and related parts and consumables that employ mechanical abrasion or log-to-log contact to efficiently remove bark from logs of all shapes and species;
|
|
-
|
Stranders: disc and ring stranders and related parts and consumables that cut batch-fed logs into strands for OSB production;
|
|
-
|
Chippers: disc, drum, and veneer chippers and related parts and consumables are high quality, robust chipper systems for waste-wood and whole-log applications found in pulp woodrooms, chip plants, sawmill, and planer mill sites; and
|
|
-
|
Logging machinery: feller bunchers, log loaders, and swing yarders that are used to harvest and gather timber for lumber production.
|
|
|
Three Months Ended
|
|
|
|
Less: Currency Translation
|
|
|
|
(Non-GAAP) Adjusted Total
|
||||||||||||||
(In thousands) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Total Increase
|
|
|
Less:
Acquisitions
|
|
Increase (Decrease)
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Stock-Preparation
|
|
$
|
56,376
|
|
|
$
|
46,178
|
|
|
$
|
10,198
|
|
|
$
|
2,943
|
|
|
$
|
—
|
|
|
$
|
7,255
|
|
Doctoring, Cleaning, & Filtration
|
|
29,543
|
|
|
27,033
|
|
|
2,510
|
|
|
561
|
|
|
—
|
|
|
1,949
|
|
||||||
Fluid-Handling
|
|
32,531
|
|
|
22,520
|
|
|
10,011
|
|
|
758
|
|
|
5,430
|
|
|
3,823
|
|
||||||
Papermaking Systems
|
|
118,450
|
|
|
95,731
|
|
|
22,719
|
|
|
4,262
|
|
|
5,430
|
|
|
13,027
|
|
||||||
Wood Processing Systems
|
|
33,152
|
|
|
11,393
|
|
|
21,759
|
|
|
398
|
|
|
23,440
|
|
|
(2,079
|
)
|
||||||
Fiber-based Products
|
|
3,311
|
|
|
3,118
|
|
|
193
|
|
|
—
|
|
|
—
|
|
|
193
|
|
||||||
|
|
$
|
154,913
|
|
|
$
|
110,242
|
|
|
$
|
44,671
|
|
|
$
|
4,660
|
|
|
$
|
28,870
|
|
|
$
|
11,141
|
|
|
|
Three Months Ended
|
||||
|
|
June 30,
2018 |
|
July 1,
2017 |
||
Papermaking Systems
|
|
45.3
|
%
|
|
48.2
|
%
|
Wood Processing Systems
|
|
38.9
|
%
|
|
44.9
|
%
|
Fiber-based Products
|
|
50.0
|
%
|
|
52.3
|
%
|
Consolidated Gross Margin
|
|
44.0
|
%
|
|
47.9
|
%
|
|
|
Three Months Ended
|
|
|
||||||||
(In thousands) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Increase
|
||||||
Papermaking Systems
|
|
$
|
30,070
|
|
|
$
|
26,777
|
|
|
$
|
3,293
|
|
Wood Processing Systems
|
|
6,978
|
|
|
5,413
|
|
|
1,565
|
|
|||
Corporate and Other
|
|
8,084
|
|
|
6,780
|
|
|
1,304
|
|
|||
|
|
$
|
45,132
|
|
|
$
|
38,970
|
|
|
$
|
6,162
|
|
|
|
Six Months Ended
|
|
|
|
Less: Currency Translation
|
|
|
|
(Non-GAAP) Adjusted Total
|
||||||||||||||
(In thousands) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Total Increase
|
|
|
Less:
Acquisitions
|
|
Increase (Decrease)
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Stock-Preparation
|
|
$
|
101,859
|
|
|
$
|
87,331
|
|
|
$
|
14,528
|
|
|
$
|
6,399
|
|
|
$
|
—
|
|
|
$
|
8,129
|
|
Doctoring, Cleaning, & Filtration
|
|
56,765
|
|
|
52,383
|
|
|
4,382
|
|
|
1,762
|
|
|
—
|
|
|
2,620
|
|
||||||
Fluid-Handling
|
|
65,417
|
|
|
44,567
|
|
|
20,850
|
|
|
2,357
|
|
|
11,330
|
|
|
7,163
|
|
||||||
Papermaking Systems
|
|
224,041
|
|
|
184,281
|
|
|
39,760
|
|
|
10,518
|
|
|
11,330
|
|
|
17,912
|
|
||||||
Wood Processing Systems
|
|
72,293
|
|
|
21,336
|
|
|
50,957
|
|
|
865
|
|
|
52,310
|
|
|
(2,218
|
)
|
||||||
Fiber-based Products
|
|
7,772
|
|
|
7,482
|
|
|
290
|
|
|
—
|
|
|
—
|
|
|
290
|
|
||||||
|
|
$
|
304,106
|
|
|
$
|
213,099
|
|
|
$
|
91,007
|
|
|
$
|
11,383
|
|
|
$
|
63,640
|
|
|
$
|
15,984
|
|
|
|
Six Months Ended
|
||||
|
|
June 30,
2018 |
|
July 1,
2017 |
||
Papermaking Systems
|
|
45.4
|
%
|
|
48.0
|
%
|
Wood Processing Systems
|
|
39.2
|
%
|
|
43.6
|
%
|
Fiber-based Products
|
|
53.5
|
%
|
|
53.9
|
%
|
Consolidated Gross Margin
|
|
44.1
|
%
|
|
47.8
|
%
|
|
|
Six Months Ended
|
|
|
||||||||
(In thousands) |
|
June 30,
2018 |
|
July 1,
2017 |
|
Increase
|
||||||
Papermaking Systems
|
|
$
|
60,826
|
|
|
$
|
52,962
|
|
|
$
|
7,864
|
|
Wood Processing Systems
|
|
14,277
|
|
|
7,254
|
|
|
7,023
|
|
|||
Corporate and Other
|
|
15,805
|
|
|
13,374
|
|
|
2,431
|
|
|||
|
|
$
|
90,908
|
|
|
$
|
73,590
|
|
|
$
|
17,318
|
|
–
|
agreements may be difficult to enforce and receivables difficult to collect through a foreign country's legal system;
|
–
|
foreign customers may have longer payment cycles;
|
–
|
foreign countries may impose additional withholding taxes or otherwise tax our foreign income, impose tariffs, adopt other restrictions on foreign trade, impose currency restrictions or enact other protectionist or anti-trade measures;
|
–
|
environmental and other regulations can adversely impact our ability to operate our facilities;
|
–
|
disruption from climate change, natural disaster, fires, war, terrorist activity, and other force majeure events beyond our control;
|
–
|
worsening economic conditions may result in worker unrest, labor actions, and potential work stoppages;
|
–
|
political unrest may disrupt commercial activities of ours or our customers;
|
–
|
it may be difficult to repatriate funds, due to unfavorable domestic and foreign tax consequences or other restrictions or limitations imposed by foreign governments; and
|
–
|
the protection of intellectual property in foreign countries may be more difficult to enforce.
|
Exhibit Number
|
|
|
|
Description of Exhibit
|
|
|
|
|
10.1*
|
|
|
|
|
|
31.1*
|
|
|
|
|
|
31.2*
|
|
|
|
|
|
32**
|
|
|
|
|
|
101.INS*
|
|
XBRL Instance Document.
|
|
|
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.CAL*
|
|
XBRL Taxonomy Calculation Linkbase Document.
|
|
|
|
101.LAB*
|
|
XBRL Taxonomy Label Linkbase Document.
|
|
|
|
101.PRE*
|
|
XBRL Taxonomy Presentation Linkbase Document.
|
|
|
|
101.DEF*
|
|
XBRL Taxonomy Definition Linkbase Document.
|
|
|
|
|
*
|
Filed herewith.
|
||
**
|
Furnished herewith.
|
|
KADANT INC.
|
|
|
Date: August 8, 2018
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
Notional Amount
|
|
USD 15,000,000
|
Trade Date:
|
|
May 16, 2018
|
Effective Date
|
|
May 16, 2018
|
Termination Date
|
|
June 30, 2023
|
Fixed Amounts
|
|
|
Fixed Rate Payer
|
|
Counterparty
|
Fixed Rate Payer Payment Dates
|
|
Payment Dates as specified in the Notional Schedule
|
|
|
|
Fixed Rate
|
|
3.15 percent
|
Fixed Rate Day Count Fraction
|
|
Actual/360
|
Business Days for Fixed Amounts
|
|
London, New York
|
Floating Amounts
|
|
|
Floating Rate Payer
|
|
Citizens
|
Floating Rate Payer Payment Dates
|
|
Payment Dates as specified in the Notional Schedule
|
|
|
|
Floating Rate Option
|
|
USD-LIBOR-BBA-Bloomberg- provided, however, that if the Floating Rate Option for any Calculation
period is less than 0.00%, then the Floating Rate Option for such calculation shall be deemed to be 0.00%.
|
Interpolation
|
|
Applicable
0.00%
|
Floor Rate
|
|
|
Designated Maturity
|
|
3 Month, with the exception of the initial Calculation Period which will be a Linear Interpolation of the 1 month and 2 month rates.
|
|
|
|
Floating Rate for the Initial Calculation Period
|
|
N/A
|
Spread
|
|
N/A
|
Floating Rate Day Count Fraction
|
|
Actual/360
|
Compounding
|
|
N/A
|
Reset Dates
|
|
The first day of each Calculation Period
|
Business Days for Floating Amounts
|
|
London, New York
|
Calculation Agent
|
|
As per The Agreement
|
|
|
|
Other Details
N/A
|
|
|
|
|
|
Account Details
|
|
|
Payments to the Counterparty:
|
|
|
Bank Name: Wells Fargo Bank
|
|
|
Account Number: 4162079339
|
|
|
Account Name: Kadant, Inc.
|
|
|
ABA Number: 121000248
|
|
|
|
|
|
Offices
|
|
|
The Office of Citizens for the Transaction is :
|
|
Boston
|
The Office of the Counterparty for the Transaction is :
|
|
Westford
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended
June 30, 2018
of Kadant 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
|
5.
|
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.
|
|
|
Date: August 8, 2018
|
/s/ Jonathan W. Painter
|
|
Jonathan W. Painter
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended
June 30, 2018
of Kadant 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
|
5.
|
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.
|
|
|
Date: August 8, 2018
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Chief Financial Officer
|
|
|
Dated: August 8, 2018
|
/s/ Jonathan W. Painter
|
|
Jonathan W. Painter
|
|
Chief Executive Officer
|
|
|
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Chief Financial Officer
|