WESTFORD, Mass., Feb. 16, 2022 (GLOBE NEWSWIRE) -- Kadant Inc. (NYSE:KAI) reported its financial results for the fourth quarter and fiscal year ended January 1, 2022.

Fourth Quarter Financial Highlights

Operating cash flow increased 51% to a record $61 million.
Free cash flow increased 47% to a record $56 million.
Bookings increased 17% to $231 million.
Revenue increased 30% to a record $219 million.
GAAP diluted EPS increased 48% to a record $2.07.
Adjusted diluted EPS increased 50% to a record $2.31.
Net income increased 49% to $24 million.
Adjusted EBITDA was a record $45 million and represented 20.5% of revenue.

Fiscal Year Financial Highlights

Records Achieved in Each of the Following Metrics:

Operating cash flow increased 75% to $162 million.
Free cash flow increased 75% to $150 million.
Bookings increased 38% to $893 million.
Ending backlog of $310 million.
Revenue increased 24% to $787 million.
GAAP diluted EPS increased 51% to $7.21.
Adjusted diluted EPS increased 57% to $7.83.
Net income increased 52% to $84 million.
Adjusted EBITDA increased 38% to $159 million and represented 20.3% of revenue.

Note: Percent changes above are based on comparison to the prior year period. Free cash flow, adjusted diluted EPS, adjusted EBITDA, adjusted EBITDA margin, and changes in organic revenue are non-GAAP financial measures that exclude certain items as detailed later in this press release under the heading "Use of Non-GAAP Financial Measures."

Management Commentary

"Solid execution by our businesses led to an exceptional finish to a record-setting year," said Jeffrey L. Powell, president and chief executive officer. "Improved operating leverage drove our adjusted EBITDA margin to 20.5 percent and generated record operating cash flow of $61 million in the fourth quarter. Strong demand for our wood processing equipment and robust aftermarket demand across all our operating segments led to strong bookings and a record backlog. Revenue in the fourth quarter was up 30 percent to a record $219 million benefiting from strong demand for both capital and parts that continued throughout most of 2021.

"For the full-year 2021, our diluted EPS and adjusted diluted EPS increased more than 50 percent to $7.21 and $7.83, respectively. While supply chain issues, labor shortages, and raw materials inflation remain a challenge, our strong focus on operational excellence and our decentralized business structure have proven valuable in offsetting these headwinds. Our global team performed exceptionally well under challenging circumstances, and they deserve a lot of credit for the results we achieved in 2021."

Fourth Quarter 2021 compared to 2020

Revenue increased 30 percent to $218.5 million compared to $168.4 million in 2020. Organic revenue increased 18 percent, which excludes 12 percent from acquisitions. Gross margin was 42.4 percent compared to 44.1 percent in 2020.

GAAP diluted earnings per share (EPS) increased 48 percent to $2.07 compared to $1.40 in 2020. Adjusted diluted EPS increased 50 percent to $2.31 compared to $1.54 in 2020. Adjusted diluted EPS in 2021 excludes $0.23 of acquisition-related costs, $0.08 of impairment and restructuring costs, a $0.04 discrete tax benefit, and a $0.03 gain on the sale of a building. Adjusted diluted EPS in 2020 excludes $0.13 of impairment and restructuring costs and $0.01 of acquired backlog amortization. Net income was $24.2 million compared to $16.2 million in 2020. Adjusted EBITDA increased 39 percent to $44.8 million compared to $32.1 million in the prior year quarter. Operating cash flow increased 51 percent to a record $61.0 million compared to $40.3 million in 2020.

Bookings increased 17 percent to a record $230.8 million compared to $196.5 million in 2020. Organic bookings increased six percent, which excludes 11 percent from acquisitions.

Fiscal Year 2021 compared to 2020

Revenue increased 24 percent to $786.6 million compared to $635.0 million in 2020. Organic revenue increased 15 percent, which excludes five percent from acquisitions and four percent from the favorable effect of foreign currency translation. Gross margin was 42.9 percent compared to 43.7 percent in 2020.

GAAP diluted EPS increased 51 percent to $7.21 compared to $4.77 in 2020. Adjusted diluted EPS increased 57 percent to $7.83 compared to $5.00 in 2020. Adjusted diluted EPS in 2021 excludes $0.60 of acquisition-related costs, $0.08 of impairment and restructuring costs, a $0.04 discrete tax benefit, and a $0.03 gain on the sale of a building. Adjusted diluted EPS in 2020 excludes $0.19 of impairment and restructuring costs, $0.07 of acquisition-related costs, and a $0.03 discrete tax benefit. Net income was $84.0 million compared to $55.2 million in 2020. Adjusted EBITDA increased 38 percent to $159.4 million and 20.3 percent of revenue compared to $115.9 million and 18.3 percent of revenue in 2020. Operating cash flow increased 75 percent to $162.4 million compared to $92.9 million in 2020.

Bookings increased 38 percent to $893.2 million compared to $648.5 million in 2020. Organic bookings increased 28 percent, which excludes six percent from acquisitions and four percent from the favorable effect of foreign currency translation.

Summary and Outlook

"Our record backlog at the end of 2021 positions us well for a solid start to 2022," Mr. Powell continued. "Project activity remains healthy and demand for parts has continued to show resiliency in the first weeks of 2022. Persistent supply chain challenges and future policy responses to inflationary pressures introduce less visibility into the latter half of 2022. That said, we expect to deliver strong financial performance in the coming year with full year GAAP diluted EPS of $8.50 to $8.70 on revenue of $870 to $890 million in 2022. Adjusted diluted EPS is expected to be $8.55 to $8.75 in 2022, which excludes pre-tax amortization expense associated with acquisition-related backlog of $0.7 million, or $0.05 per diluted share. The 2022 guidance includes a negative effect from foreign currency translation, which is lowering revenue by $12 million and adjusted diluted EPS by $0.15. For the first quarter of 2022, we expect revenue of $212 to $217 million, GAAP diluted EPS of $1.95 to $2.05, and excluding $0.05 per diluted share of amortization expense associated with acquired backlog, adjusted diluted EPS of $2.00 to $2.10.

Conference Call

Kadant will hold a webcast with a slide presentation for investors on Thursday, February 17, 2022, at 11:00 a.m. eastern time to discuss its fourth quarter and full-year performance, as well as future expectations. To access the webcast, including the slideshow and accompanying audio, go to www.kadant.com and click on "Investors." To listen to the webcast via teleconference, call 888-326-8410 within the U.S., or +1-704-385-4884 outside the U.S. and reference participant passcode 9569006. Prior to the call, our earnings release and the slides used in the webcast presentation will be filed with the Securities and Exchange Commission and will be available at www.sec.gov. An archive of the webcast presentation will be available on our website until March 18, 2022.

Shortly after the webcast, Kadant will post its updated general investor presentation incorporating the fourth quarter and fiscal year results on its website at www.kadant.com under the "Investors" section.

Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures, including increases or decreases in revenue excluding the effect of acquisitions and foreign currency translation (organic revenue), adjusted operating income, adjusted net income, adjusted diluted EPS, earnings before interest, taxes, depreciation, and amortization (EBITDA), adjusted EBITDA, adjusted EBITDA margin, and free cash flow.

We believe these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our core business, operating results, or future outlook. We believe that the inclusion of such measures helps investors gain an understanding of our underlying operating performance and future prospects, consistent with how management measures and forecasts our performance, especially when comparing such results to previous periods or forecasts and to the performance of our competitors. Such measures are also used by us in our financial and operating decision-making and for compensation purposes. We also believe this information is responsive to investors' requests and gives them an additional measure of our performance.

The non-GAAP financial measures included in this press release are not meant to be considered superior to or a substitute for the results of operations prepared in accordance with GAAP. In addition, the non-GAAP financial measures included in this press release have limitations associated with their use as compared to the most directly comparable GAAP measures, in that they may be different from, and therefore not comparable to, similar measures used by other companies.

We present increases or decreases in organic revenue, which excludes the effect of acquisitions and foreign currency translation, to provide investors insight into underlying revenue trends. Revenue in the fourth quarter of 2021 included $19.6 million from acquisitions. Revenue in 2021 included $32.9 million from acquisitions and a $22.2 million favorable foreign currency effect.

Our non-GAAP financial measures exclude impairment and restructuring costs, acquisition costs, amortization expense related to acquired profit in inventory and backlog, gain or loss on sale, and discrete tax items. Free cash flow excludes capital expenditures from cash flow from operations. These items are excluded as they are not indicative of our core operating results and are not comparable to other periods, which have differing levels of incremental costs, expenditures or income, or none at all.

Fourth Quarter

Adjusted operating income, adjusted EBITDA, and adjusted EBITDA margin exclude:

Pre-tax impairment and restructuring costs of $1.0 million in 2021 and $2.1 million in 2020.
Pre-tax gain on sale of $0.5 million in 2021.
Pre-tax acquisition costs of $1.0 million in 2021.
Pre-tax expense related to acquired backlog amortization of $0.6 million in 2021 and $0.2 million in 2020.
Pre-tax expense related to amortization of acquired profit in inventory of $2.1 million in 2021.

Adjusted net income and adjusted diluted EPS exclude:

After-tax impairment and restructuring costs of $1.0 million in 2021 and $1.5 million ($2.1 million net of tax of $0.6 million) in 2020.
After-tax gain on sale of $0.4 million ($0.5 million net of tax of $0.1 million) in 2021.
After-tax acquisition costs of $0.7 million ($1.0 million net of tax of $0.3 million) in 2021.
After-tax expense related to acquired backlog amortization of $0.5 million ($0.6 million net of tax of $0.1 million) in 2021 and $0.1 million ($0.2 million net of tax of $0.1 million) in 2020.
After-tax expense related to amortization of acquired profit in inventory of $1.5 million ($2.1 million net of tax of $0.6 million) in 2021.
A discrete tax benefit of $0.4 million in 2021.

Free cash flow is calculated as operating cash flow less:

Capital expenditures of $5.1 million in 2021 and $2.2 million in 2020.

Fiscal Year

Adjusted operating income, adjusted EBITDA, and adjusted EBITDA margin exclude:

Pre-tax impairment and restructuring costs of $1.0 million in 2021 and $3.0 million in 2020.
Pre-tax gain on sale of $0.5 million.
Pre-tax acquisition costs of $3.7 million in 2021 and $0.5 million in 2020.
Pre-tax expense related to acquired backlog amortization of $1.3 million in 2021 and $0.5 million in 2020.
Pre-tax expense related to amortization of acquired profit in inventory of $4.3 million in 2021.

Adjusted net income and adjusted diluted EPS exclude:

After-tax impairment and restructuring costs of $1.0 million in 2021 and $2.2 million ($3.0 million net of tax of $0.8 million) in 2020.
After-tax gain on sale of $0.4 million ($0.5 million net of tax of $0.1 million) in 2021.
After-tax acquisition costs of $3.1 million ($3.7 million net of tax of $0.6 million) in 2021 and $0.4 million ($0.5 million net of tax of $0.1 million) in 2020.
After-tax expense related to acquired backlog amortization of $1.0 million ($1.3 million net of tax of $0.3 million) in 2021 and $0.4 million ($0.5 million net of tax of $0.1 million) in 2020.
After-tax expense related to amortization of acquired profit in inventory of $3.0 million ($4.3 million net of tax of $1.3 million) in 2019.
A discrete tax benefit of $0.4 million in 2021 and $0.3 million in 2020.

Free cash flow is calculated as operating cash flow less:

Capital expenditures of $12.8 million in 2021 and $7.6 million in 2020.

Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in this press release.

Financial Highlights (unaudited)
(In thousands, except per share amounts and percentages)

			Three Months Ended						Twelve Months Ended
Consolidated Statement of Income			Jan. 1, 2022			Jan. 2, 2021			Jan. 1, 2022			Jan. 2, 2021
Revenue			$	218,516		$	168,431		$	786,579		$	635,028
Costs and Operating Expenses:
	Cost of revenue			125,877			94,212			449,214			357,722
	Selling, general, and administrative expenses			57,773			47,387			208,787			181,905
	Research and development expenses			2,856			2,766			11,403			11,298
	Impairment and other costs, net (h)			465			2,053			465			2,979
				186,971			146,418			669,869			553,904
Operating Income				31,545			22,013			116,710			81,124
Interest Income				91			41			267			181
Interest Expense				(1,324	)		(1,363	)		(4,821	)		(7,423	)
Other Expense, Net				(33	)		(100	)		(104	)		(195	)
Income Before Provision for Income Taxes				30,279			20,591			112,052			73,687
Provision for Income Taxes				5,919			4,210			27,171			17,948
Net Income				24,360			16,381			84,881			55,739
Net Income Attributable to Noncontrolling Interest				(203	)		(174	)		(838	)		(543	)
Net Income Attributable to Kadant			$	24,157		$	16,207		$	84,043		$	55,196

Earnings per Share Attributable to Kadant:
		Basic	$	2.08		$	1.41		$	7.26		$	4.81
		Diluted	$	2.07		$	1.40		$	7.21		$	4.77

Weighted Average Shares:
		Basic		11,606			11,513			11,579			11,482
		Diluted		11,689			11,608			11,655			11,564

			Three Months Ended						Three Months Ended
Adjusted Net Income and Adjusted Diluted EPS (a)			Jan. 1, 2022			Jan. 1, 2022			Jan. 2, 2021			Jan. 2, 2021
Net Income and Diluted EPS Attributable to Kadant, as Reported			$	24,157		$	2.07		$	16,207		$	1.40
Adjustments for the Following:
	Impairment and Restructuring Costs, Net of Tax (h)			980			0.08			1,543			0.13
	Gain on Sale, Net of Tax (h)			(391	)		(0.03	)		—			—
	Acquisition Costs, Net of Tax (b)			725			0.06			—			—
	Acquired Backlog Amortization, Net of Tax (c)			479			0.04			132			0.01
	Acquired Profit in Inventory, Net of Tax (d)			1,484			0.13			—			—
	Discrete Tax Items			(419	)		(0.04	)		—			—
Adjusted Net Income and Adjusted Diluted EPS (a)			$	27,015		$	2.31		$	17,882		$	1.54

			Twelve Months Ended						Twelve Months Ended
Adjusted Net Income and Adjusted Diluted EPS (a)			Jan. 1, 2022			Jan. 1, 2022			Jan. 2, 2021			Jan. 2, 2021
Net Income and Diluted EPS Attributable to Kadant, as Reported			$	84,043		$	7.21		$	55,196		$	4.77
Adjustments for the Following:
	Impairment and Restructuring Costs, Net of Tax (h)			980			0.08			2,210			0.19
	Gain on Sale, Net of Tax (h)			(391	)		(0.03	)		—			—
	Acquisition Costs, Net of Tax (b)			3,050			0.26			355			0.03
	Acquired Backlog Amortization, Net of Tax (c)			973			0.08			407			0.04
	Acquired Profit in Inventory, Net of Tax (d)			3,033			0.26			—			—
	Discrete Tax Items			(419	)		(0.04	)		(338	)		(0.03	)
Adjusted Net Income and Adjusted Diluted EPS (a)			$	91,269		$	7.83		$	57,830		$	5.00

			Three Months Ended									Increase Excluding Acquisitions and FX (a,e)
Revenue by Segment			Jan. 1, 2022			Jan. 2, 2021			Increase			Increase Excluding Acquisitions and FX (a,e)
Flow Control			$	78,019		$	60,115		$	17,904		$	4,920
Industrial Processing				95,307			69,109			26,198			25,193
Material Handling				45,190			39,207			5,983			342
			$	218,516		$	168,431		$	50,085		$	30,455

Percentage of Parts and Consumables Revenue				63	%		67	%

			Twelve Months Ended						Increase			Increase Excluding Acquisitions and FX (a,e)
			Jan. 1, 2022			Jan. 2, 2021			Increase			Increase Excluding Acquisitions and FX (a,e)
Flow Control			$	288,788		$	225,444		$	63,344		$	33,698
Industrial Processing				328,762			261,577			67,185			53,584
Material Handling				169,029			148,007			21,022			9,188
			$	786,579		$	635,028		$	151,551		$	96,470

Percentage of Parts and Consumables Revenue				65	%		66	%

			Three Months Ended						Increase			Increase (Decrease) Excluding Acquisitions and FX (e)
Bookings by Segment			Jan. 1, 2022			Jan. 2, 2021			Increase			Increase (Decrease) Excluding Acquisitions and FX (e)
Flow Control			$	83,706		$	61,878		$	21,828		$	8,892
Industrial Processing				94,924			94,759			165			(1,065	)
Material Handling				52,200			39,898			12,302			4,860
			$	230,830		$	196,535		$	34,295		$	12,687

Percentage of Parts and Consumables Bookings				61	%		61	%

			Twelve Months Ended						Increase			Increase Excluding Acquisitions and FX (e)
			Jan. 1, 2022			Jan. 2, 2021			Increase			Increase Excluding Acquisitions and FX (e)
Flow Control			$	308,185		$	228,591		$	79,594		$	49,346
Industrial Processing				402,325			273,644			128,681			111,280
Material Handling				182,668			146,242			36,426			20,221
			$	893,178		$	648,477		$	244,701		$	180,847

Percentage of Parts and Consumables Bookings				59	%		65	%

			Three Months Ended						Twelve Months Ended
Business Segment Information			Jan. 1, 2022			Jan. 2, 2021			Jan. 1, 2022			Jan. 2, 2021
Gross Margin:
		Flow Control		48.9	%		52.5	%		51.0	%		52.9	%
		Industrial Processing		40.2	%		42.3	%		40.1	%		41.3	%
		Material Handling		35.8	%		34.3	%		34.4	%		33.7	%
				42.4	%		44.1	%		42.9	%		43.7	%

Operating Income:
		Flow Control	$	13,610		$	14,170		$	65,509		$	51,530
		Industrial Processing		22,120			10,824			66,569			42,971
		Material Handling		4,602			4,034			17,543			14,375
		Corporate		(8,787	)		(7,015	)		(32,911	)		(27,752	)
			$	31,545		$	22,013		$	116,710		$	81,124

Adjusted Operating Income (a,f):
		Flow Control	$	16,839		$	14,108		$	72,680		$	52,189
		Industrial Processing		21,655			12,840			66,277			45,788
		Material Handling		6,042			4,310			20,394			14,907
		Corporate		(8,787	)		(7,015	)		(32,911	)		(27,752	)
			$	35,749		$	24,243		$	126,440		$	85,132

Capital Expenditures:
		Flow Control	$	2,298		$	1,141		$	4,128		$	2,808
		Industrial Processing		1,692			663			6,412			3,123
		Material Handling		1,090			372			2,211			1,539
		Corporate		3			—			20			125
			$	5,083		$	2,176		$	12,771		$	7,595

			Three Months Ended						Twelve Months Ended
Cash Flow and Other Data			Jan. 1, 2022			Jan. 2, 2021			Jan. 1, 2022			Jan. 2, 2021
Operating Cash Flow			$	61,010		$	40,283		$	162,420		$	92,884
Less: Capital Expenditures				(5,083	)		(2,176	)		(12,771	)		(7,595	)
Free Cash Flow (a)			$	55,927		$	38,107		$	149,649		$	85,289

Depreciation and Amortization Expense			$	9,705		$	8,074		$	34,302		$	31,334

Balance Sheet Data									Jan. 1, 2022			Jan. 2, 2021
Assets
Cash, Cash Equivalents, and Restricted Cash									$	94,161		$	66,640
Accounts Receivable, net										117,209			91,540
Inventories										134,356			106,814
Contract Assets										8,626			7,576
Property, Plant, and Equipment, net										107,989			84,642
Intangible Assets										199,343			160,965
Goodwill										396,887			351,753
Other Assets										73,641			57,641
									$	1,132,212		$	927,571
Liabilities and Stockholders' Equity
Accounts Payable									$	59,250		$	32,264
Debt Obligations										264,597			227,963
Other Borrowings										4,917			5,511
Other Liabilities										237,832			164,928
	Total Liabilities									566,596			430,666
	Stockholders' Equity									565,616			496,905
									$	1,132,212		$	927,571

		Three Months Ended						Twelve Months Ended
Adjusted Operating Income and Adjusted EBITDA Reconciliation (a)		Jan. 1, 2022			Jan. 2, 2021			Jan. 1, 2022			Jan. 2, 2021
Consolidated
	Net Income Attributable to Kadant	$	24,157		$	16,207		$	84,043		$	55,196
	Net Income Attributable to Noncontrolling Interest		203			174			838			543
	Provision for Income Taxes		5,919			4,210			27,171			17,948
	Interest Expense, Net		1,233			1,322			4,554			7,242
	Other Expense, Net		33			100			104			195
	Operating Income		31,545			22,013			116,710			81,124
	Impairment and Restructuring Costs (h)		980			2,053			980			2,979
	Gain on Sale (h)		(515	)		—			(515	)		—
	Acquisition Costs (b)		1,036			—			3,655			485
	Acquired Backlog Amortization (c)		635			177			1,326			544
	Acquired Profit in Inventory (d)		2,068			—			4,284			—
	Adjusted Operating Income (a)		35,749			24,243			126,440			85,132
	Depreciation and Amortization		9,070			7,897			32,976			30,790
	Adjusted EBITDA (a)	$	44,819		$	32,140		$	159,416		$	115,922
	Adjusted EBITDA Margin (a,g)		20.5	%		19.1	%		20.3	%		18.3	%

Flow Control
	Operating Income	$	13,610		$	14,170		$	65,509		$	51,530
	Impairment and Restructuring Costs (Income) (h)		980			(62	)		980			659
	Acquisition Costs (b)		967			—			2,710			—
	Acquired Backlog Amortization (c)		46			—			399			—
	Acquired Profit in Inventory (d)		1,236			—			3,082			—
	Adjusted Operating Income (a)		16,839			14,108			72,680			52,189
	Depreciation and Amortization		2,494			1,604			7,967			6,333
	Adjusted EBITDA (a)	$	19,333		$	15,712		$	80,647		$	58,522
	Adjusted EBITDA Margin (a,g)		24.8	%		26.1	%		27.9	%		26.0	%

Industrial Processing
	Operating Income	$	22,120		$	10,824		$	66,569		$	42,971
	Impairment and Restructuring Costs (h)		—			1,933			—			2,138
	Gain on Sale (h)		(515	)		—			(515	)		—
	Acquisition Costs (b)		50			—			163			485
	Acquired Backlog Amortization (c)		—			83			60			194
	Adjusted Operating Income (a)		21,655			12,840			66,277			45,788
	Depreciation and Amortization		3,325			3,371			13,407			12,969
	Adjusted EBITDA (a)	$	24,980		$	16,211		$	79,684		$	58,757
	Adjusted EBITDA Margin (a,g)		26.2	%		23.5	%		24.2	%		22.5	%

Material Handling
	Operating Income	$	4,602		$	4,034		$	17,543		$	14,375
	Restructuring Costs		—			182			—			182
	Acquisition Costs (b)		19			—			782			—
	Acquired Backlog Amortization (c)		589			94			867			350
	Acquired Profit in Inventory (d)		832			—			1,202			—
	Adjusted Operating Income (a)		6,042			4,310			20,394			14,907
	Depreciation and Amortization		3,221			2,862			11,474			11,278
	Adjusted EBITDA (a)	$	9,263		$	7,172		$	31,868		$	26,185
	Adjusted EBITDA Margin (a,g)		20.5	%		18.3	%		18.9	%		17.7	%

Corporate
	Operating Loss	$	(8,787	)	$	(7,015	)	$	(32,911	)	$	(27,752	)
	Depreciation and Amortization		30			60			128			210
	EBITDA (a)	$	(8,757	)	$	(6,955	)	$	(32,783	)	$	(27,542	)

(a)	Represents a non-GAAP financial measure.

(b)	Represents transaction costs associated with our acquisitions.

(c)	Represents intangible amortization expense associated with acquired backlog.

(d)	Represents expense within cost of revenue associated with amortization of acquired profit in inventory.

(e)	Represents the increase (decrease) resulting from the exclusion of acquisitions and from the conversion of current period amounts reported in local currencies into U.S. dollars at the exchange rate of the prior period compared to the U.S. dollar amount reported in the prior period.

(f)	See reconciliation to the most directly comparable GAAP financial measure under "Adjusted Operating Income and Adjusted EBITDA Reconciliation."

(g)	Calculated as adjusted EBITDA divided by revenue in each period.

(h)	The fourth quarter and full-year 2021 include an intangible asset impairment charge of $499, restructuring and other costs of $481, and a gain on the sale of a building of $515 ($391 after tax). The fourth quarter of 2020 includes an intangible asset impairment charge of $1,861 ($1,389 after tax) and restructuring costs of $192 ($154 after tax), and the full-year 2020 includes an intangible asset impairment charge of $1,861 ($1,389 after tax) and restructuring costs of $1,118 ($821 after tax).

About Kadant

Kadant Inc. is a global supplier of technologies and engineered systems that drive Sustainable Industrial Processing. The Company's products and services play an integral role in enhancing efficiency, optimizing energy utilization, and maximizing productivity in process industries. Kadant is based in Westford, Massachusetts, with approximately 2,900 employees in 20 countries worldwide. For more information, visit www.kadant.com.

Safe Harbor Statement

The following constitutes a "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This press release contains forward-looking statements that involve a number of risks and uncertainties, including forward-looking statements about our future financial and operating performance, demand for our products, and economic and industry outlook. These forward-looking statements represent our expectations as of the date of this press release. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. 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 set forth under the heading "Risk Factors" in Kadant's annual report on Form 10-K for the fiscal year ended January 2, 2021 and subsequent filings with the Securities and Exchange Commission. These include risks and uncertainties relating to the impact of the COVID-19 pandemic on our operating and financial results; adverse changes in global and local economic conditions; the variability and difficulty in accurately predicting revenues from large capital equipment and systems projects; health epidemics; our acquisition strategy; levels of residential construction activity; reductions by our wood processing customers of their capital spending or production of oriented strand board; changes to the global timber supply; development and use of digital media; cyclical economic conditions affecting the global mining industry; demand for coal, including economic and environmental risks associated with coal; failure of our information systems or breaches of data security and cybertheft; implementation of our internal growth strategy; supply chain constraints, inflationary pressure, price increases and shortages in raw materials; competition; changes in our tax provision or exposure to additional tax liabilities; our ability to successfully manage our manufacturing operations; disruption in production; future restructurings; loss of key personnel and effective succession planning; protection of intellectual property; climate change; adequacy of our insurance coverage; global operations; policies of the Chinese government; the variability and uncertainties in sales of capital equipment in China; currency fluctuations; economic conditions and regulatory changes caused by the United Kingdom's exit from the European Union; changes to government regulations and policies around the world; compliance with government regulations and policies and compliance with laws; environmental laws and regulations; environmental, health and safety laws and regulations impacting the mining industry; our debt obligations; restrictions in our credit agreement and note purchase agreement; substitution of an alternative index for LIBOR; soundness of financial institutions; fluctuations in our share price; and anti-takeover provisions.

Contacts

Investor Contact Information:

Michael McKenney, 978-776-2000

IR@kadant.com

or

Media Contact Information:

Wes Martz, 269-278-1715

media@kadant.com

Kadant Reports Fourth Quarter and Fiscal Year 2021 Results