Kennametal Inc. (NYSE: KMT), headquartered in Latrobe, Pennsylvania, USA, has reported results for its fiscal first-quarter 2015, stating sales for the period totalled $695 million, compared with $620 million in the same quarter last year.
Operating income was $61 million, compared with $59 million in the same quarter last year. Operating income also included $7 million of restructuring and related charges, primarily due to equipment relocation and facility expenses. Adjusted operating margin was 9.9%, compared with an adjusted operating margin of 9.7% in the prior year.
“September quarter sales growth was driven by ongoing demand strength in our Industrial segment; however, our Infrastructure business was challenged by continued weak conditions in underground mining and road construction, partially offset by modest improvement in the oil and gas sector. We are pleased to have made significant progress in integrating the Tungsten Materials Business, and we are accelerating measures to reduce costs and improve efficiencies that should position Kennametal for improved profitability,” stated Carlos Cardoso, Kennametal Chairman and Chief Executive Officer.
Kennametal is updating its outlook due to weaker economic conditions anticipated for the remainder of fiscal 2015. Key factors include softer customer demand in the Eurozone, lower drilling activity in the oil and gas sector, as well as a continued decline in underground mining production levels.
The company now expects fiscal 2015 total sales growth in the range of 2 to 4%, with organic sales growth of 1 to 3%. Previously, the company had forecast total sales growth in the range of 5 to 7%, with organic sales growth of 3 to 5%.