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Kennametal Inc. Reports Operating Results (10-Q)

November 05, 2010 | About:
10qk

10qk

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Kennametal Inc. (KMT) filed Quarterly Report for the period ended 2010-09-30.

Kennametal Inc. has a market cap of $2.86 billion; its shares were traded at around $34.93 with a P/E ratio of 31.8 and P/S ratio of 1.6. The dividend yield of Kennametal Inc. stocks is 1.3%.KMT is in the portfolios of Chuck Royce of Royce& Associates, Pioneer Investments, Columbia Wanger of Columbia Wanger Asset Management, Bruce Kovner of Caxton Associates.

Highlight of Business Operations:

Cash Flow Provided by Operating Activities During the three months ended September 30, 2010, cash flow provided by operating activities was $26.4 million, compared to $17.3 million for the prior year period. Cash flow provided by operating activities for the current year period consisted of net income and non-cash items amounting to $68.7 million, partially offset by changes in certain assets and liabilities netting to $42.3 million. Contributing to the changes in certain assets and liabilities was an increase in inventory of $34.0 million driven by an increase in production to meet expected increases in demand, a decrease in accounts payable and accrued liabilities of $9.6 million, and a decrease in other of $5.8 million, partially offset by an increase in domestic and foreign income taxes of $6.3 million.

During the three months ended September 30, 2009, cash flow provided by operating activities consisted of net loss and non-cash items amounting to $19.6 million of cash generation partially offset by changes in certain assets and liabilities netting to $2.3 million. Contributing to the changes in certain assets and liabilities were a decrease in accounts receivable of $2.2 million and a decrease in inventories of $16.8 million, partially offset by a decrease in accounts payable and accrued liabilities of $6.7 million, a decrease in accrued income taxes of $5.3 million and a decrease in other liabilities of $9.3 million.

At September 30, 2010, total assets increased $112.9 million to $2,380.7 million from $2,267.8 million at June 30, 2010. Total liabilities increased $8.7 million to $943.1 million at September 30, 2010 from $934.4 million at June 30, 2010.

Working capital was $608.9 million at September 30, 2010, an increase of $86.0 million from $522.9 million at June 30, 2010. The increase in working capital was driven primarily by an increase in inventories of $53.8 million driven by an increase in production to meet expected increases in demand, an increase in accounts receivable of $16.1 million due to the increase in sales, an increase in cash and cash equivalents of $6.1 million, and a decrease in current maturities of long-term debt and capital leases, including notes payable of $17.9 million, partially offset by an increase in accrued income taxes and accrued expenses of $15.5 million. Foreign currency effects accounted for $19.7 million, $16.9 million, $9.8 million and $5.9 million of the change in inventory, accounts receivable, cash and cash equivalents and accrued income taxes and accrued expenses, respectively.

Property, plant and equipment, net increased $12.9 million from $664.5 million at June 30, 2010 to $677.4 million at September 30, 2010, primarily due to capital additions of $10.1 million, favorable foreign currency impact of $23.4 million, partially offset by, depreciation expense of $19.8 million.

Kennametal shareowners equity was $1,417.1 million at September 30, 2010, an increase of $101.6 million from $1,315.5 million at June 30, 2010. The increase was primarily due to net income attributable to Kennametal of $34.9 million and foreign currency translation adjustments of $72.7 million, partially offset by cash dividends paid to shareowners of $10.0 million.

Read the The complete Report

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