Kadant Inc. supplies technologies and engineered systems worldwide. The company operates through three segments: Flow Control, Industrial Processing, and Material Handling. The ...
Kadant Inc. operates through three business segments: Flow Control, Industrial Processing, and Material Handling. The Flow Control segment develops and markets fluid-handling systems, rotary joints, syphons, expansion joints, steam and condensate systems, doctor blades, cleaning showers, and water-filtration systems. The Industrial Processing segment offers debarkers, chippers, engineered knife systems, pulping ...Kadant Inc. operates through three business segments: Flow Control, Industrial Processing, and Material Handling. The Flow Control segment develops and markets fluid-handling systems, rotary joints, syphons, expansion joints, steam and condensate systems, doctor blades, cleaning showers, and water-filtration systems. The Industrial Processing segment offers debarkers, chippers, engineered knife systems, pulping equipment, boiler cleaning technologies, and screw presses. The Material Handling segment provides vibratory and conveying equipment, baling components, and fiber-based products.
With approximately 3,900 employees across 22 countries, Kadant generates revenue through direct sales, independent agents, and distributors. As of the latest TTM data, the company has a market cap of around $3.99 billion, with a price-to-earnings ratio of 36.3 and a net profit margin of 9.5%. Its gross profit margin is 44.4%, indicating strong profitability. The company maintains a healthy balance sheet with a current ratio of 9.28 and no debt, as indicated by debt-to-equity ratio of 0. Its return on equity stands at 11.4%, and it pays a dividend yield of 0.4%.
Kadant has a history of innovation and growth, having been incorporated in 1991 as Thermo Fibertek Inc. and renamed to Kadant in 2001 after a spin-off from Thermo Electron. Under CEO Jeffrey L. Powell, who has served since 2019, the company continues to expand globally. The company focuses on 'Sustainable Industrial Processing' and launched new products like the Foundations fiber product line. With a strong emphasis on R&D (1.4% of revenue), Kadant aims to deliver engineered solutions that enhance efficiency and sustainability for its customers.
YoYYoY means Year-over-Year. It compares the latest annual value with the previous annual value to show long-term trend strength.
QoQQoQ means Quarter-over-Quarter. It compares the latest quarter with the immediately previous quarter to show short-term momentum changes.
RevenueThe total money that came through the front door from selling things, before paying a single bill. Think of it as the grand total of every credit card swipe from customers. (YoY compares this year to last year's performance, while QoQ compares the current three months to the previous three).
$1.1B
-0.1%
-1.6%
Net IncomeThe absolute bottom line. If the company paid every single supplier, employee, banker, and tax collector, this is the actual money left in their pocket at the end of the day.
$102.0M
-8.6%
+6.2%
Gross MarginThe basic markup. If they sell a $100 pair of sneakers, this percentage tells you how much of that price tag is profit right after paying for the rubber and shoelaces, but before paying for things like store rent or TV commercials.
+45.2%
+2.2%
+2.5%
Operating MarginThe 'day job' efficiency score. Out of every dollar a customer spends, this shows how many cents the company keeps after making the product AND paying for all the everyday corporate overhead (like salaries, marketing, and keeping the lights on).
+14.9%
-8.1%
+2.7%
Net MarginThe final take-home percentage. When you strip away every conceivable cost, tax, and interest payment, this is the exact number of cents the company truly gets to keep from every dollar in sales.
+9.7%
-8.5%
+7.9%
Free Cash FlowThe holy grail of corporate cash. It's the spendable, physical money left over after the business pays for its daily operations AND buys the big, expensive upgrades (like new factories or servers) it needs to survive. This is the 'free' money they can use to pay dividends or buy back stock.
$154.3M
+14.9%
+128.1%
FCF MarginThe ultimate cash conversion rate. It shows how good the company is at turning regular sales directly into cold, hard, spendable cash. A high percentage means the business is an absolute cash-printing machine.
+14.7%
+15.0%
+131.9%
Debt / EquityThe financial risk gauge. It compares how much of the company's empire was built using borrowed money (loans) versus the owners' own money (shareholders). A high number means they are heavily leveraged and playing a riskier game; a low number means they are playing it safe.
38.2%
+0.3%
-100.0%
Current RatioThe 12-month survival check. It simply compares the cash they have right now (plus things they can quickly turn into cash) against the immediate bills they absolutely must pay this year. A score above 1 means they have enough in the wallet to cover the upcoming bills without panicking.
2.14x
-7.4%
+4.7%
Total AssetsThe absolute size of the company's empire. It bundles together absolutely everything of value they own—from the cash in the register and the inventory in the warehouse, to the software patents in the vault and the factories on the ground.
Operator: Good day, and thank you for standing by. Welcome to the Q1 2026 Kadant Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Michael McKenney, Executive Vice President and Chief Financial Officer. Please go ahead.
Michael McKenney: Thank you, Therese. Good morning, everyone, and welcome to Kadant's First Quarter 2026 Earnings Call. With me on the call today is Jeff Powell, our President and Chief Executive Officer. Before we begin, let me read our safe harbor statement. Various remarks that we may make today about Kadant's future plans and expectations, financial and operating results and prospects are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results to differ materially from these forward-looking statements as a result of various important factors, including those outlined at the beginning of our slide presentation and those discussed under the heading Risk Factors in our annual report on Form 10-K for the fiscal year ended January 3, 2026, and subsequent filings with the Securities and Exchange Commission. In addition, any forward-looking statements we make during this webcast represent our views and estimates only as of today. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views or estimates change. During this webcast, we will refer to some non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is contained in our first quarter earnings press release and the slides presented on the webcast and discussed in the conference call, which are available in the Investors section of our website at kadant.com. Finally, I wanted to note that when we refer to GAAP earnings per share or EPS and adjusted EPS on this call, we are referring to each of these measures as calculated on a diluted basis. With that, I'll turn the call over to Jeff Powell, who will give you an update on Kadant's business and future prospects. Following Jeff's remarks, I'll give an overview of our financial results for the quarter, and we will then have our Q&A session. Jeff?
Jeffrey Powell: Thanks, Mike. Hello, everyone. Thank you for joining us this morning to review our first quarter results and discuss our business outlook for 2026. The first quarter was a strong start to the year, highlighted by robust demand and solid earnings growth. We delivered strong profitability while continuing to see healthy demand in our aftermarket business and improving capital business. …
