Kennametal Inc. (NYSE: KMT) has reported record annual sales, profitability and returns in its recently published fiscal 2012 full-year results.
The company reported sales of $2.7 billion in fiscal 2012, up 14% from $2.4 billion in the previous year. The sales increase reflects 9% organic growth, a 4% acquisition contribution and 1% from more business days in 2012, stated the company.
Operating income was $416 million compared with $322 million last year. Before net acquisition-related costs in the current year of $5 million and costs associated with restructuring in fiscal 2011 of $21 million, operating income was $422 million and $343 million, respectively. Adjusted operating margin was 15.9% for fiscal 2012, compared with adjusted operating margin of 14.3% last year.
“Fiscal 2012 was an excellent year for Kennametal,” stated Chairman, President and Chief Executive Officer Carlos Cardoso. “We outperformed our markets, set new records, and delivered 15% earnings before interest and taxes (EBIT) margin and 15% return on invested capital (ROIC), a full year ahead of schedule. This performance marks our second straight year of record profitability and returns. Consistent with our strategies, we established clear goals, realized ongoing improvements in operational efficiencies and successfully managed multiple headwinds.”
Fourth quarter shows 10th consecutive quarter of organic growth
Sales were $739 million in the fourth quarter, compared with $694 million in the same quarter last year. The sales increase reflected a 10% acquisition contribution, 1% organic growth and 1% from more business days in the 2012 quarter, partially offset by a 5% unfavourable effect from currency exchange.
Operating income was $117 million compared with $115 million in the same quarter last year. Operating income included $1 million of net acquisition-related loss, while the prior year’s operating income included restructuring and related charges of $7 million. Operating income increased as a result of higher sales volume, pricing and lower employment and restructuring costs, all of which offset higher raw material costs. Operating margin excluding the impact of the acquisition of Stellite was 17.6%, compared to an adjusted operating margin of 17.5% in the prior year.
“The June quarter represented our 10th consecutive quarter of organic growth, reflecting successful execution of our strategies across the diverse markets and geographies we serve. In addition, we further increased sales and strengthened our core business as a result of the recent Stellite acquisition. Our company specific initiatives continue to position Kennametal to achieve significant margin and earnings expansion. We remain committed to delivering shareowner value.” Cardoso added.
Posted by: Paul Whittaker, Editor ipmd.net, [email protected]