☒
|
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
|
Delaware
|
|
52-1762325
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock, $.01 par value
|
|
KAI
|
|
New York Stock Exchange
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
|
|
Emerging growth company
|
☐
|
|
|
Page
|
PART I: Financial Information
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||
PART II: Other Information
|
||
|
|
|
|
|
|
|
|
March 28,
2020 |
|
December 28,
2019 |
||||
(In thousands, except share and per share amounts)
|
|
|
||||||
|
|
|
|
|
||||
Assets
|
|
|
|
|
||||
Current Assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
60,012
|
|
|
$
|
66,786
|
|
Restricted cash
|
|
2,063
|
|
|
1,487
|
|
||
Accounts receivable
|
|
93,850
|
|
|
98,438
|
|
||
Less: allowance for credit losses
|
|
2,712
|
|
|
2,698
|
|
||
Accounts receivable, net
|
|
91,138
|
|
|
95,740
|
|
||
Inventories
|
|
102,718
|
|
|
102,715
|
|
||
Unbilled revenue
|
|
12,194
|
|
|
13,162
|
|
||
Other current assets
|
|
19,556
|
|
|
17,686
|
|
||
Total Current Assets
|
|
287,681
|
|
|
297,576
|
|
||
Property, Plant, and Equipment, at Cost
|
|
179,639
|
|
|
181,341
|
|
||
Less: accumulated depreciation and amortization
|
|
95,891
|
|
|
95,309
|
|
||
Property, Plant, and Equipment, at Cost, Net
|
|
83,748
|
|
|
86,032
|
|
||
Other Assets
|
|
39,932
|
|
|
45,851
|
|
||
Intangible Assets, Net (Note 1)
|
|
166,690
|
|
|
173,896
|
|
||
Goodwill (Note 1)
|
|
330,997
|
|
|
336,032
|
|
||
Total Assets
|
|
$
|
909,048
|
|
|
$
|
939,387
|
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
|
||||
Current Liabilities:
|
|
|
|
|
||||
Current maturities of long-term obligations (Note 4)
|
|
$
|
2,687
|
|
|
$
|
2,851
|
|
Accounts payable
|
|
41,196
|
|
|
45,852
|
|
||
Accrued payroll and employee benefits
|
|
22,036
|
|
|
31,968
|
|
||
Customer deposits
|
|
25,588
|
|
|
24,012
|
|
||
Advanced billings
|
|
8,335
|
|
|
11,280
|
|
||
Other current liabilities
|
|
30,057
|
|
|
30,206
|
|
||
Total Current Liabilities
|
|
129,899
|
|
|
146,169
|
|
||
Long-Term Obligations (Note 4)
|
|
292,689
|
|
|
298,174
|
|
||
Other Long-Term Liabilities
|
|
62,188
|
|
|
67,965
|
|
||
|
|
|
|
|
||||
Commitments and Contingencies (Note 11)
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
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
|
|
105,457
|
|
|
106,698
|
|
||
Retained earnings
|
|
445,027
|
|
|
435,249
|
|
||
Treasury stock at cost, 3,154,644 and 3,214,888 shares
|
|
(77,302
|
)
|
|
(78,778
|
)
|
||
Accumulated other comprehensive items (Note 7)
|
|
(50,554
|
)
|
|
(37,620
|
)
|
||
Total Kadant Stockholders' Equity
|
|
422,774
|
|
|
425,695
|
|
||
Noncontrolling interest
|
|
1,498
|
|
|
1,384
|
|
||
Total Stockholders' Equity
|
|
424,272
|
|
|
427,079
|
|
||
Total Liabilities and Stockholders' Equity
|
|
$
|
909,048
|
|
|
$
|
939,387
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
(In thousands, except per share amounts)
|
|
|
||||||
|
|
|
|
|
||||
Revenue (Notes 1 and 10)
|
|
$
|
159,127
|
|
|
$
|
171,316
|
|
|
|
|
|
|
||||
Costs and Operating Expenses:
|
|
|
|
|
|
|
||
Cost of revenue
|
|
90,804
|
|
|
100,801
|
|
||
Selling, general, and administrative expenses
|
|
45,592
|
|
|
49,319
|
|
||
Research and development expenses
|
|
3,076
|
|
|
2,621
|
|
||
|
|
139,472
|
|
|
152,741
|
|
||
|
|
|
|
|
||||
Operating Income
|
|
19,655
|
|
|
18,575
|
|
||
|
|
|
|
|
||||
Interest Income
|
|
51
|
|
|
56
|
|
||
Interest Expense
|
|
(2,459
|
)
|
|
(3,504
|
)
|
||
Other Expense, Net
|
|
(32
|
)
|
|
(99
|
)
|
||
|
|
|
|
|
||||
Income Before Provision for Income Taxes
|
|
17,215
|
|
|
15,028
|
|
||
Provision for Income Taxes (Note 3)
|
|
4,559
|
|
|
3,963
|
|
||
Net Income
|
|
12,656
|
|
|
11,065
|
|
||
|
|
|
|
|
||||
Net Income Attributable to Noncontrolling Interest
|
|
(125
|
)
|
|
(165
|
)
|
||
|
|
|
|
|
||||
Net Income Attributable to Kadant
|
|
$
|
12,531
|
|
|
$
|
10,900
|
|
|
|
|
|
|
||||
Earnings per Share Attributable to Kadant (Note 2)
|
|
|
|
|
|
|
||
Basic
|
|
$
|
1.10
|
|
|
$
|
0.98
|
|
Diluted
|
|
$
|
1.09
|
|
|
$
|
0.96
|
|
|
|
|
|
|
||||
Weighted Average Shares (Note 2)
|
|
|
|
|
|
|
||
Basic
|
|
11,432
|
|
|
11,133
|
|
||
Diluted
|
|
11,508
|
|
|
11,385
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
(In thousands)
|
|
|
||||||
|
|
|
|
|
||||
Net Income
|
|
$
|
12,656
|
|
|
$
|
11,065
|
|
Other Comprehensive Items:
|
|
|
|
|
|
|
||
Foreign currency translation adjustment
|
|
(12,574
|
)
|
|
(465
|
)
|
||
Pension and other post-retirement liability adjustments, net (net of tax of $20 and $8)
|
|
50
|
|
|
21
|
|
||
Effect of other post-retirement plan settlement
|
|
(119
|
)
|
|
—
|
|
||
Deferred loss on cash flow hedges (net of tax of $119 and $104)
|
|
(302
|
)
|
|
(237
|
)
|
||
Total other comprehensive items
|
|
(12,945
|
)
|
|
(681
|
)
|
||
Comprehensive (Loss) Income
|
|
(289
|
)
|
|
10,384
|
|
||
Comprehensive Income Attributable to Noncontrolling Interest
|
|
(114
|
)
|
|
(132
|
)
|
||
Comprehensive (Loss) Income Attributable to Kadant
|
|
$
|
(403
|
)
|
|
$
|
10,252
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
(In thousands)
|
|
|
||||||
|
|
|
|
|
||||
Operating Activities
|
|
|
|
|
||||
Net income attributable to Kadant
|
|
$
|
12,531
|
|
|
$
|
10,900
|
|
Net income attributable to noncontrolling interest
|
|
125
|
|
|
165
|
|
||
Net income
|
|
12,656
|
|
|
11,065
|
|
||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
7,598
|
|
|
8,231
|
|
||
Stock-based compensation expense
|
|
1,639
|
|
|
1,553
|
|
||
Provision for losses on accounts receivable
|
|
103
|
|
|
64
|
|
||
Gain on sale of property, plant, and equipment
|
|
(10
|
)
|
|
(200
|
)
|
||
Other items, net
|
|
(877
|
)
|
|
596
|
|
||
Changes in current assets and liabilities, net of effects of acquisition:
|
|
|
|
|
|
|
||
Accounts receivable
|
|
1,929
|
|
|
(1,190
|
)
|
||
Unbilled revenue
|
|
844
|
|
|
(1,055
|
)
|
||
Inventories
|
|
(3,735
|
)
|
|
(3,263
|
)
|
||
Other current assets
|
|
(1,107
|
)
|
|
(189
|
)
|
||
Accounts payable
|
|
(3,440
|
)
|
|
3,872
|
|
||
Other current liabilities
|
|
(9,431
|
)
|
|
(9,608
|
)
|
||
Net cash provided by operating activities
|
|
6,169
|
|
|
9,876
|
|
||
|
|
|
|
|
||||
Investing Activities
|
|
|
|
|
|
|
||
Acquisition, net of cash acquired
|
|
—
|
|
|
(175,288
|
)
|
||
Purchases of property, plant, and equipment
|
|
(2,686
|
)
|
|
(2,168
|
)
|
||
Proceeds from sale of property, plant, and equipment
|
|
14
|
|
|
293
|
|
||
Net cash used in investing activities
|
|
(2,672
|
)
|
|
(177,163
|
)
|
||
|
|
|
|
|
||||
Financing Activities
|
|
|
|
|
|
|
||
Proceeds from issuance of long-term obligations
|
|
—
|
|
|
189,000
|
|
||
Repayment of long-term obligations
|
|
(2,969
|
)
|
|
(6,404
|
)
|
||
Dividends paid
|
|
(2,628
|
)
|
|
(2,444
|
)
|
||
Tax withholding payments related to stock-based compensation
|
|
(2,318
|
)
|
|
(2,647
|
)
|
||
Proceeds from issuance of Company common stock
|
|
913
|
|
|
723
|
|
||
Payment of debt issuance costs
|
|
—
|
|
|
(36
|
)
|
||
Net cash (used in) provided by financing activities
|
|
(7,002
|
)
|
|
178,192
|
|
||
|
|
|
|
|
||||
Exchange Rate Effect on Cash, Cash Equivalents, and Restricted Cash
|
|
(2,693
|
)
|
|
153
|
|
||
|
|
|
|
|
||||
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash
|
|
(6,198
|
)
|
|
11,058
|
|
||
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period
|
|
68,273
|
|
|
46,117
|
|
||
Cash, Cash Equivalents, and Restricted Cash at End of Period
|
|
$
|
62,075
|
|
|
$
|
57,175
|
|
|
|
Three Months Ended March 28, 2020
|
||||||||||||||||||||||||||||||||
(In thousands, except share and per 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 28, 2019
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
106,698
|
|
|
$
|
435,249
|
|
|
3,214,888
|
|
|
$
|
(78,778
|
)
|
|
$
|
(37,620
|
)
|
|
$
|
1,384
|
|
|
$
|
427,079
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,531
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
125
|
|
|
12,656
|
|
|||||||
Dividend declared – Common Stock, $0.24 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,753
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,753
|
)
|
|||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(1,241
|
)
|
|
—
|
|
|
(60,244
|
)
|
|
1,476
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,934
|
)
|
|
(11
|
)
|
|
(12,945
|
)
|
|||||||
Balance at March 28, 2020
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
105,457
|
|
|
$
|
445,027
|
|
|
3,154,644
|
|
|
$
|
(77,302
|
)
|
|
$
|
(50,554
|
)
|
|
$
|
1,498
|
|
|
$
|
424,272
|
|
|
|
Three Months Ended March 30, 2019
|
||||||||||||||||||||||||||||||||
(In thousands, except share and per 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 29, 2018
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
104,731
|
|
|
$
|
393,578
|
|
|
3,514,163
|
|
|
$
|
(86,111
|
)
|
|
$
|
(39,376
|
)
|
|
$
|
1,603
|
|
|
$
|
374,571
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,900
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
165
|
|
|
11,065
|
|
|||||||
Adoption of ASU No. 2016-02, Leases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|||||||
Dividend declared – Common Stock, $0.23 per share
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,570
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,570
|
)
|
|||||||
Activity under stock plans
|
|
—
|
|
|
—
|
|
|
(1,951
|
)
|
|
—
|
|
|
(64,435
|
)
|
|
1,579
|
|
|
—
|
|
|
—
|
|
|
(372
|
)
|
|||||||
Other comprehensive items
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(648
|
)
|
|
(33
|
)
|
|
(681
|
)
|
|||||||
Balance at March 30, 2019
|
|
14,624,159
|
|
|
$
|
146
|
|
|
$
|
102,780
|
|
|
$
|
401,891
|
|
|
3,449,728
|
|
|
$
|
(84,532
|
)
|
|
$
|
(40,024
|
)
|
|
$
|
1,735
|
|
|
$
|
381,996
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
Cash Paid for Interest
|
|
$
|
2,212
|
|
|
$
|
2,782
|
|
Cash Paid for Income Taxes, Net of Refunds
|
|
$
|
4,698
|
|
|
$
|
4,679
|
|
|
|
|
|
|
||||
Non-Cash Investing Activities:
|
|
|
|
|
||||
Post-closing acquisition adjustment
|
|
$
|
—
|
|
|
$
|
1,567
|
|
|
|
|
|
|
||||
Liabilities assumed of acquired business
|
|
$
|
—
|
|
|
$
|
29,664
|
|
|
|
|
|
|
||||
Non-cash additions to property, plant, and equipment
|
|
$
|
128
|
|
|
$
|
193
|
|
|
|
|
|
|
||||
Non-Cash Financing Activities:
|
|
|
|
|
|
|
||
Issuance of Company common stock upon vesting of restricted stock units
|
|
$
|
3,670
|
|
|
$
|
3,278
|
|
Dividends declared but unpaid
|
|
$
|
2,753
|
|
|
$
|
2,570
|
|
(In thousands)
|
|
March 28,
2020 |
|
March 30,
2019 |
|
December 28,
2019 |
|
December 29,
2018 |
||||||||
Cash and cash equivalents
|
|
$
|
60,012
|
|
|
$
|
56,478
|
|
|
$
|
66,786
|
|
|
$
|
45,830
|
|
Restricted cash
|
|
2,063
|
|
|
697
|
|
|
1,487
|
|
|
287
|
|
||||
Total Cash, Cash Equivalents, and Restricted Cash
|
|
$
|
62,075
|
|
|
$
|
57,175
|
|
|
$
|
68,273
|
|
|
$
|
46,117
|
|
|
|
March 28,
2020 |
|
December 28,
2019 |
||||
(In thousands)
|
|
|
||||||
Raw Materials
|
|
$
|
49,617
|
|
|
$
|
49,332
|
|
Work in Process
|
|
14,495
|
|
|
15,344
|
|
||
Finished Goods
|
|
38,606
|
|
|
38,039
|
|
||
|
|
$
|
102,718
|
|
|
$
|
102,715
|
|
(In thousands)
|
|
Gross
|
|
Accumulated
Amortization |
|
Currency
Translation |
|
Net
|
||||||||
March 28, 2020
|
|
|
|
|
|
|
|
|
||||||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
171,583
|
|
|
$
|
(55,194
|
)
|
|
$
|
(6,077
|
)
|
|
$
|
110,312
|
|
Product technology
|
|
56,011
|
|
|
(28,776
|
)
|
|
(2,096
|
)
|
|
25,139
|
|
||||
Tradenames
|
|
6,527
|
|
|
(2,551
|
)
|
|
(458
|
)
|
|
3,518
|
|
||||
Other
|
|
17,964
|
|
|
(13,416
|
)
|
|
(605
|
)
|
|
3,943
|
|
||||
|
|
252,085
|
|
|
(99,937
|
)
|
|
(9,236
|
)
|
|
142,912
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
24,100
|
|
|
—
|
|
|
(322
|
)
|
|
23,778
|
|
||||
Acquired Intangible Assets
|
|
$
|
276,185
|
|
|
$
|
(99,937
|
)
|
|
$
|
(9,558
|
)
|
|
$
|
166,690
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 28, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Definite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
|
$
|
171,583
|
|
|
$
|
(51,798
|
)
|
|
$
|
(4,141
|
)
|
|
$
|
115,644
|
|
Product technology
|
|
56,011
|
|
|
(27,819
|
)
|
|
(1,709
|
)
|
|
26,483
|
|
||||
Tradenames
|
|
6,527
|
|
|
(2,421
|
)
|
|
(427
|
)
|
|
3,679
|
|
||||
Other
|
|
17,964
|
|
|
(13,295
|
)
|
|
(593
|
)
|
|
4,076
|
|
||||
|
|
252,085
|
|
|
(95,333
|
)
|
|
(6,870
|
)
|
|
149,882
|
|
||||
Indefinite-Lived
|
|
|
|
|
|
|
|
|
||||||||
Tradenames
|
|
24,100
|
|
|
—
|
|
|
(86
|
)
|
|
24,014
|
|
||||
Acquired Intangible Assets
|
|
$
|
276,185
|
|
|
$
|
(95,333
|
)
|
|
$
|
(6,956
|
)
|
|
$
|
173,896
|
|
(In thousands)
|
|
Flow Control
|
|
Industrial Processing
|
|
Material Handling
|
|
Total
|
||||||||
Balance at December 28, 2019 (a)
|
|
|
|
|
|
|
|
|
||||||||
Gross balance
|
|
$
|
97,680
|
|
|
$
|
207,536
|
|
|
$
|
116,325
|
|
|
$
|
421,541
|
|
Accumulated impairment losses
|
|
—
|
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
||||
Net balance
|
|
97,680
|
|
|
122,027
|
|
|
116,325
|
|
|
336,032
|
|
||||
2020 Adjustment
|
|
|
|
|
|
|
|
|
||||||||
Currency translation
|
|
(1,552
|
)
|
|
(3,182
|
)
|
|
(301
|
)
|
|
(5,035
|
)
|
||||
Total 2020 adjustment
|
|
(1,552
|
)
|
|
(3,182
|
)
|
|
(301
|
)
|
|
(5,035
|
)
|
||||
Balance at March 28, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross balance
|
|
96,128
|
|
|
204,354
|
|
|
116,024
|
|
|
416,506
|
|
||||
Accumulated impairment losses
|
|
—
|
|
|
(85,509
|
)
|
|
—
|
|
|
(85,509
|
)
|
||||
Net balance
|
|
$
|
96,128
|
|
|
$
|
118,845
|
|
|
$
|
116,024
|
|
|
$
|
330,997
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
Balance at Beginning of Year
|
|
$
|
6,467
|
|
|
$
|
5,726
|
|
Provision charged to expense
|
|
1,270
|
|
|
1,076
|
|
||
Usage
|
|
(1,365
|
)
|
|
(925
|
)
|
||
Acquisition
|
|
—
|
|
|
295
|
|
||
Currency translation
|
|
(162
|
)
|
|
(3
|
)
|
||
Balance at End of Period
|
|
$
|
6,210
|
|
|
$
|
6,169
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
|
|
March 30,
|
||||
(In thousands)
|
|
2020
|
|
2019
|
||||
Point in Time
|
|
$
|
136,092
|
|
|
$
|
148,276
|
|
Over Time
|
|
23,035
|
|
|
23,040
|
|
||
|
|
$
|
159,127
|
|
|
$
|
171,316
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
|
|
March 30,
|
||||
(In thousands)
|
|
2020
|
|
2019
|
||||
Revenue by Product Type:
|
|
|
|
|
|
|
||
Parts and Consumables
|
|
$
|
105,098
|
|
|
$
|
112,850
|
|
Capital
|
|
54,029
|
|
|
58,466
|
|
||
|
|
$
|
159,127
|
|
|
$
|
171,316
|
|
Revenue by Geography:
|
|
|
|
|
|
|
||
North America
|
|
$
|
93,823
|
|
|
$
|
100,876
|
|
Europe
|
|
36,014
|
|
|
38,985
|
|
||
Asia
|
|
15,908
|
|
|
17,078
|
|
||
Rest of World
|
|
13,382
|
|
|
14,377
|
|
||
|
|
$
|
159,127
|
|
|
$
|
171,316
|
|
|
|
March 28,
2020 |
|
December 28,
2019 |
||||
(In thousands)
|
|
|
||||||
Accounts Receivable
|
|
$
|
91,138
|
|
|
$
|
95,740
|
|
Contract Assets
|
|
$
|
12,194
|
|
|
$
|
13,162
|
|
Contract Liabilities
|
|
$
|
35,663
|
|
|
$
|
37,216
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 28, 2020
|
|
March 30, 2019
|
||||
Balance at Beginning of Period
|
|
$
|
2,698
|
|
|
$
|
2,897
|
|
Provision charged to expense
|
|
103
|
|
|
64
|
|
||
Accounts written off
|
|
(26
|
)
|
|
(17
|
)
|
||
Currency translation
|
|
(63
|
)
|
|
7
|
|
||
Balance at End of Period
|
|
$
|
2,712
|
|
|
$
|
2,951
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
(In thousands, except per share amounts)
|
|
|
||||||
|
|
|
|
|
||||
Net Income Attributable to Kadant
|
|
$
|
12,531
|
|
|
$
|
10,900
|
|
|
|
|
|
|
||||
Basic Weighted Average Shares
|
|
11,432
|
|
|
11,133
|
|
||
Effect of Stock Options, Restricted Stock Units and Employee Stock Purchase Plan Shares
|
|
76
|
|
|
252
|
|
||
Diluted Weighted Average Shares
|
|
11,508
|
|
|
11,385
|
|
||
|
|
|
|
|
||||
Basic Earnings per Share
|
|
$
|
1.10
|
|
|
$
|
0.98
|
|
|
|
|
|
|
||||
Diluted Earnings per Share
|
|
$
|
1.09
|
|
|
$
|
0.96
|
|
|
|
March 28,
2020 |
|
December 28,
2019 |
||||
(In thousands)
|
|
|
||||||
Revolving Credit Facility, due 2023
|
|
$
|
260,485
|
|
|
$
|
265,419
|
|
Commercial Real Estate Loan, due 2020 to 2028
|
|
19,163
|
|
|
19,425
|
|
||
Senior Promissory Notes, due 2023 to 2028
|
|
10,000
|
|
|
10,000
|
|
||
Finance Leases, due 2020 to 2025
|
|
2,079
|
|
|
2,308
|
|
||
Other Borrowings, due 2020 to 2023
|
|
3,773
|
|
|
4,000
|
|
||
Unamortized Debt Issuance Costs
|
|
(124
|
)
|
|
(127
|
)
|
||
Total
|
|
295,376
|
|
|
301,025
|
|
||
Less: Current Maturities of Long-Term Obligations
|
|
(2,687
|
)
|
|
(2,851
|
)
|
||
Long-Term Obligations
|
|
$
|
292,689
|
|
|
$
|
298,174
|
|
|
(In thousands)
|
|
Foreign
Currency
Translation
Adjustment
|
|
Pension and Other Post-Retirement Benefit Liability Adjustments
|
|
Deferred Loss on Cash Flow Hedges
|
|
Total
|
||||||||
Balance at December 28, 2019
|
|
$
|
(36,145
|
)
|
|
$
|
(831
|
)
|
|
$
|
(644
|
)
|
|
$
|
(37,620
|
)
|
Other comprehensive (loss) income before reclassifications
|
|
(12,563
|
)
|
|
38
|
|
|
(345
|
)
|
|
(12,870
|
)
|
||||
Reclassifications from AOCI
|
|
—
|
|
|
(107
|
)
|
|
43
|
|
|
(64
|
)
|
||||
Net current period other comprehensive items
|
|
(12,563
|
)
|
|
(69
|
)
|
|
(302
|
)
|
|
(12,934
|
)
|
||||
Balance at March 28, 2020
|
|
$
|
(48,708
|
)
|
|
$
|
(900
|
)
|
|
$
|
(946
|
)
|
|
$
|
(50,554
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
||||||
(In thousands)
|
|
March 28,
2020 |
|
March 30,
2019 |
|
Statement of Income
Line Item
|
||||
Retirement Benefit Plans (a)
|
|
|
||||||||
Recognized net actuarial loss
|
|
$
|
(15
|
)
|
|
$
|
(16
|
)
|
|
Other expense, net
|
Amortization of prior service cost
|
|
(2
|
)
|
|
—
|
|
|
Other expense, net
|
||
Total expense before income taxes
|
|
(17
|
)
|
|
(16
|
)
|
|
|
||
Income tax benefit
|
|
124
|
|
|
4
|
|
|
Provision for income taxes
|
||
|
|
107
|
|
|
(12
|
)
|
|
|
||
Cash Flow Hedges (b)
|
|
|
|
|
|
|
|
|
||
Interest rate swap agreements
|
|
(34
|
)
|
|
20
|
|
|
Interest expense
|
||
Forward currency-exchange contracts
|
|
(23
|
)
|
|
—
|
|
|
Cost of revenue
|
||
Total (expense) income before income taxes
|
|
(57
|
)
|
|
20
|
|
|
|
||
Income tax benefit (provision)
|
|
14
|
|
|
(5
|
)
|
|
Provision for income taxes
|
||
|
|
(43
|
)
|
|
15
|
|
|
|
||
Total Reclassifications
|
|
$
|
64
|
|
|
$
|
3
|
|
|
|
(a)
|
Included in the computation of net periodic benefit cost. See Note 6, Retirement Benefit Plans, for additional information.
|
(b)
|
|
|
|
|
March 28, 2020
|
|
December 28, 2019
|
||||||||||||
|
|
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:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contract
|
|
Other Current Assets
|
|
$
|
72
|
|
|
$
|
1,328
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2015 Swap Agreement
|
|
Other Current Assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
10,000
|
|
Derivatives in a Liability Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contracts
|
|
Other Current Liabilities
|
|
$
|
(52
|
)
|
|
$
|
842
|
|
|
$
|
(75
|
)
|
|
$
|
4,825
|
|
2018 Swap Agreement
|
|
Other Long-Term Liabilities
|
|
$
|
(1,275
|
)
|
|
$
|
15,000
|
|
|
$
|
(770
|
)
|
|
$
|
15,000
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Derivatives in an Asset Position:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward currency-exchange contracts
|
|
Other Current Assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
387
|
|
Derivatives in a Liability Position:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward currency-exchange contracts
|
|
Other Current Liabilities
|
|
$
|
(8
|
)
|
|
$
|
1,032
|
|
|
$
|
(43
|
)
|
|
$
|
2,545
|
|
(In thousands)
|
|
Interest Rate Swap
Agreements
|
|
Forward Currency-
Exchange
Contracts
|
|
Total
|
||||||
Unrealized Loss, Net of Tax, at December 28, 2019
|
|
$
|
(589
|
)
|
|
$
|
(55
|
)
|
|
$
|
(644
|
)
|
Loss reclassified to earnings (a)
|
|
26
|
|
|
17
|
|
|
43
|
|
|||
(Loss) gain recognized in AOCI
|
|
(403
|
)
|
|
58
|
|
|
(345
|
)
|
|||
Unrealized (Loss) Gain, Net of Tax, at March 28, 2020
|
|
$
|
(966
|
)
|
|
$
|
20
|
|
|
$
|
(946
|
)
|
•
|
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.
|
|
|
Fair Value as of March 28, 2020
|
||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
6,689
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,689
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
3,329
|
|
|
$
|
—
|
|
|
$
|
3,329
|
|
Forward currency-exchange contract
|
|
$
|
—
|
|
|
$
|
72
|
|
|
$
|
—
|
|
|
$
|
72
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
2018 Swap Agreement
|
|
$
|
—
|
|
|
$
|
1,275
|
|
|
$
|
—
|
|
|
$
|
1,275
|
|
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
60
|
|
|
|
Fair Value as of December 28, 2019
|
||||||||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money market funds and time deposits
|
|
$
|
9,920
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,920
|
|
Banker's acceptance drafts (a)
|
|
$
|
—
|
|
|
$
|
5,230
|
|
|
$
|
—
|
|
|
$
|
5,230
|
|
2015 Swap Agreement
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
11
|
|
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
2018 Swap Agreement
|
|
$
|
—
|
|
|
$
|
770
|
|
|
$
|
—
|
|
|
$
|
770
|
|
Forward currency-exchange contracts
|
|
$
|
—
|
|
|
$
|
118
|
|
|
$
|
—
|
|
|
$
|
118
|
|
(a)
|
Included in accounts receivable in the accompanying condensed consolidated balance sheet.
|
|
|
March 28, 2020
|
|
December 28, 2019
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
(In thousands)
|
|
|
|
|
||||||||||||
Debt Obligations:
|
|
|
|
|
|
|
|
|
||||||||
Revolving credit facility
|
|
$
|
260,485
|
|
|
$
|
260,485
|
|
|
$
|
265,419
|
|
|
$
|
265,419
|
|
Commercial real estate loan
|
|
19,163
|
|
|
21,656
|
|
|
19,425
|
|
|
20,541
|
|
||||
Senior promissory notes
|
|
10,000
|
|
|
10,662
|
|
|
10,000
|
|
|
10,803
|
|
||||
|
|
$
|
289,648
|
|
|
$
|
292,803
|
|
|
$
|
294,844
|
|
|
$
|
296,763
|
|
•
|
Flow Control – Custom-engineered products, systems, and technologies that control the flow of fluids used in industrial and commercial applications to keep critical processes running efficiently in the packaging, tissue, food processing, metals, and other industrial sectors. The Company's products include rotary sealing devices, steam systems, expansion joints, doctor systems, roll and fabric cleaning devices, and filtration and fiber recovery systems.
|
•
|
Industrial Processing – Equipment, machinery, and technologies used to recycle paper and paperboard and process timber for use in the packaging, tissue, paper, wood products and alternative fuel industries, among others. The Company's primary products include stock preparation systems and recycling equipment, debarkers, stranders, chippers, and logging machinery.
|
•
|
Material Handling – Products and engineered systems used to handle bulk and discrete materials for secondary processing or transport in the mining, aggregates, food processing, waste management, and pulp and paper industries, among others. The Company's primary products include conveying and vibratory equipment and balers. In addition, the Company manufactures and sells biodegradable, absorbent granules used as carriers in agricultural applications and for oil and grease absorption.
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
|
|
March 30,
|
||||
(In thousands)
|
|
2020
|
|
2019
|
||||
Revenue
|
|
|
|
|
||||
Flow Control
|
|
$
|
57,149
|
|
|
$
|
61,144
|
|
Industrial Processing
|
|
64,709
|
|
|
72,274
|
|
||
Material Handling
|
|
37,269
|
|
|
37,898
|
|
||
|
|
$
|
159,127
|
|
|
$
|
171,316
|
|
|
|
Three Months Ended
|
||||||
|
|
March 28,
|
|
March 30,
|
||||
(In thousands)
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
||||
Income Before Provision for Income Taxes
|
|
|
|
|
|
|
||
Flow Control
|
|
$
|
13,330
|
|
|
$
|
12,984
|
|
Industrial Processing
|
|
9,436
|
|
|
11,854
|
|
||
Material Handling (a)
|
|
4,134
|
|
|
731
|
|
||
Corporate (b)
|
|
(7,245
|
)
|
|
(6,994
|
)
|
||
Total operating income
|
|
19,655
|
|
|
18,575
|
|
||
Interest expense, net (c)
|
|
(2,408
|
)
|
|
(3,448
|
)
|
||
Other expense, net (c)
|
|
(32
|
)
|
|
(99
|
)
|
||
|
|
$
|
17,215
|
|
|
$
|
15,028
|
|
|
|
|
|
|
||||
Capital Expenditures
|
|
|
|
|
|
|
||
Flow Control
|
|
$
|
821
|
|
|
$
|
471
|
|
Industrial Processing
|
|
1,464
|
|
|
1,363
|
|
||
Material Handling
|
|
398
|
|
|
333
|
|
||
Corporate
|
|
3
|
|
|
1
|
|
||
|
|
$
|
2,686
|
|
|
$
|
2,168
|
|
•
|
Flow Control – Custom-engineered products, systems, and technologies that control the flow of fluids used in industrial and commercial applications to keep critical processes running efficiently in the packaging, tissue, food processing, metals, and other industrial sectors. Our products include rotary sealing devices, steam systems, expansion joints, doctor systems, roll and fabric cleaning devices, and filtration and fiber recovery systems.
|
•
|
Industrial Processing – Equipment, machinery, and technologies used to recycle paper and paperboard and process timber for use in the packaging, tissue, paper, wood products and alternative fuel industries, among others. Our products include stock preparation systems and recycling equipment, debarkers, stranders, chippers, and logging machinery.
|
•
|
Material Handling – Products and engineered systems used to handle bulk and discrete materials for secondary processing or transport in the mining, aggregates, food processing, waste management, and pulp and paper industries, among others. Our products include conveying and vibratory equipment and balers. In addition, we manufacture and sell biodegradable, absorbent granules used as carriers in agricultural applications and for oil and grease absorption.
|
•
|
safeguarding our workplaces and protecting our employees;
|
•
|
serving the needs of our customers to ensure that customers are able to provide the critical supplies needed in response to the pandemic;
|
•
|
working closely with our supply chain to minimize any potential disruption; and
|
•
|
preserving our balance sheet and liquidity position
|
|
|
Three Months Ended
|
||||
|
|
March 28,
2020 |
|
March 30,
2019 |
||
Flow Control
|
|
52.9
|
%
|
|
51.2
|
%
|
Industrial Processing
|
|
38.4
|
%
|
|
38.9
|
%
|
Material Handling
|
|
35.5
|
%
|
|
29.3
|
%
|
Consolidated Gross Profit Margin
|
|
42.9
|
%
|
|
41.2
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||||||||
(In thousands, except percentages) |
|
March 28,
2020 |
|
% of Revenue
|
|
March 30,
2019 |
|
% of Revenue
|
|
Increase (Decrease)
|
|
% Change
|
||||||||
Flow Control
|
|
$
|
15,942
|
|
|
28
|
%
|
|
$
|
17,267
|
|
|
28
|
%
|
|
$
|
(1,325
|
)
|
|
(8)%
|
Industrial Processing
|
|
13,820
|
|
|
21
|
%
|
|
15,177
|
|
|
21
|
%
|
|
(1,357
|
)
|
|
(9)%
|
|||
Material Handling
|
|
8,681
|
|
|
23
|
%
|
|
9,962
|
|
|
26
|
%
|
|
(1,281
|
)
|
|
(13)%
|
|||
Corporate
|
|
7,149
|
|
|
N/A
|
|
|
6,913
|
|
|
N/A
|
|
|
236
|
|
|
3%
|
|||
Consolidated SG&A Expenses
|
|
$
|
45,592
|
|
|
29
|
%
|
|
$
|
49,319
|
|
|
29
|
%
|
|
$
|
(3,727
|
)
|
|
(8)%
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
March 28,
2020 |
|
March 30,
2019 |
||||
Net Cash Provided by Operating Activities
|
|
$
|
6,169
|
|
|
$
|
9,876
|
|
Net Cash Used in Investing Activities
|
|
(2,672
|
)
|
|
(177,163
|
)
|
||
Net Cash (Used in) Provided by Financing Activities
|
|
(7,002
|
)
|
|
178,192
|
|
||
Exchange Rate Effect on Cash, Cash Equivalents, and Restricted Cash
|
|
(2,693
|
)
|
|
153
|
|
||
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash
|
|
$
|
(6,198
|
)
|
|
$
|
11,058
|
|
•
|
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;
|
•
|
economic sanctions, trade embargoes, or other adverse trade regulations;
|
•
|
environmental and other regulations can adversely impact our ability to operate our facilities;
|
•
|
disruption from climate change, natural disaster, including earthquakes and/or tornadoes, fires, war, terrorist activity, and other force majeure events beyond our control;
|
•
|
changes in zoning laws that may require relocation of our manufacturing operations;
|
•
|
disruption from fast-spreading health epidemics which have and may continue to result in widespread interruption of business operations;
|
•
|
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;
|
•
|
fluctuations in foreign currency exchange rates and foreign interest rates beyond our control;
|
•
|
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*
|
|
|
|
|
|
10.2
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32**
|
|
|
|
|
|
101.INS
|
|
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
101.SCH
|
|
Inline XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.CAL
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
101.DEF
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
101.LAB
|
|
Inline XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
101.PRE
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
104
|
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
|
|
|
|
*
|
Indicates management contract or compensatory plan or arrangement.
|
||
**
|
Furnished herewith.
|
|
KADANT INC.
|
|
|
Date: May 6, 2020
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
•
|
An annual retainer of $65,000.
|
•
|
An additional annual retainer for our non-executive chairman of the board of $60,000.
|
•
|
An additional annual retainer for chairmen of the following committees:
|
•
|
audit committee - $10,000;
|
•
|
compensation committee - $7,500;
|
•
|
nominating and corporate governance committee - $5,000; and
|
•
|
risk oversight committee - $5,000.
|
•
|
Reimbursement of out-of pocket expenses incurred in attending or participating in meetings of our board of directors or its committees.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended March 28, 2020 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: May 6, 2020
|
/s/ Jeffrey L. Powell
|
|
Jeffrey L. Powell
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the period ended March 28, 2020 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: May 6, 2020
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Executive Vice President and Chief Financial Officer
|
|
|
Dated: May 6, 2020
|
/s/ Jeffrey L. Powell
|
|
Jeffrey L. Powell
|
|
President and Chief Executive Officer
|
|
|
|
/s/ Michael J. McKenney
|
|
Michael J. McKenney
|
|
Executive Vice President and Chief Financial Officer
|