Kennametal reported stronger sales, profit and earnings numbers in its latest quarter amid improvement in some of its end markets and soaring prices for tungsten, company officials said.
The cutting tool and engineered components manufacturer posted just shy of $530 million in sales in its fiscal second quarter, an increase of 10% from the $482 million in its previous Q2. Sales in the metal cutting segment were up 11% to $331 million, while sales in the infrastructure business rose 8% to $198 million.
President and CEO Sanjay Chowbey said that Kennametal’s sales and adjusted earnings came in above company projections as it saw “buy-ahead in response to the tungsten pricing environment and modest improvement in certain end markets.” Tungsten prices have jumped to record levels for a number of reasons, including export controls imposed by China.
Kennametal officials attributed a rise in operating income in the metal cutting segment to pricing and tariff surcharges in addition to higher sales, greater production volumes and savings from restructuring — although tariffs, inflation and higher compensation costs partially offset that total.
Kennametal’s quarterly profit rose from $145 million to $173.9 million year-over-year, while net income jumped from $19 million to $35.2 million.
The company raised its full-year sales forecast from the $2.1 billion to $2.17 billion outlined in early November up to between $2.19 billion and $2.25 billion.
"Looking ahead, we remain focused on driving above market growth, improving our cost structure and shaping a smarter portfolio to deliver long-term value for shareholders,” Chowbey said in a statement.
