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Kennametal Announces Fiscal Third Quarter 2014 Results

May 1, 2014

- Total sales growth of 15 percent; organic sales growth of 3 percent

LATROBE, Pa., May 1, 2014 /PRNewswire/ — Kennametal Inc. (NYSE: KMT) today reported results for the fiscal third quarter 2014, with earnings per diluted share (EPS) of $0.64, compared with the prior year quarter EPS of $0.67. The current quarter adjusted EPS were $0.74, absent nonrecurring charges and the results of the Tungsten Materials Business (TMB).

“We delivered solid results in the March quarter,” said Kennametal Chairman, President and CEO Carlos Cardoso. “We continued to experience growth in industrial markets such as general engineering and transportation. Customer demand related to our served infrastructure markets have stabilized in certain areas, but remain somewhat mixed. As always, we will stay focused on further improving margins and cash flows.”

Cardoso added, “The integration of our Tungsten Materials Business is on-track to deliver key objectives. The related restructuring actions are expected to result in productivity improvements as well as significant cost savings. We remain dedicated to building on our respective strengths to bring even greater value for the combined entity.”

Fiscal 2014 Third Quarter Key Developments

    --  Sales were $755 million, compared with $655 million in the same quarter
        last year. Sales increased by 15 percent, reflecting a 12 percent
        increase from the TMB acquisition, a 3 percent organic increase and a 1
        percent increase from more business days, partially offset by a 1
        percent decrease from unfavorable currency exchange.
    --  Operating income was $77 million, compared with $75 million in the same
        quarter last year. Excluding nonrecurring charges and TMB results,
        adjusted operating income was $86 million. Operating margin was 10.2
        percent, compared with an operating margin of 11.4 percent in the prior
        year. Adjusted operating margin was 12.7 percent.
    --  The reported effective tax rate was 24.1 percent compared to 18.5
        percent in the prior year quarter. The prior year rate was favorably
        impacted by the extension of the credit for increasing research
        activities contained in the American Taxpayer Relief Act of 2012 that
        was enacted in the March 2013 quarter.
    --  During the quarter, TMB contributed sales of $78 million and on-going
        operating income of $3 million or $0.01 per share, excluding the
        inventory step-up purchase accounting impact of $8 million or $0.07 per
        share. Integration efforts are on-track related to the acquisition.
    --  Restructuring and related charges of $3 million pre-tax or $0.02 per
        share were incurred during the current quarter.
    --  EPS were $0.64, compared with the prior year quarter EPS of $0.67.
        Adjusted EPS were $0.74 in the current year period.
    --  Adjusted return on invested capital (ROIC) was 7.8 percent as of March
        31, 2014 due to increased debt related to acquisitions.
    --  Year-to-date, the company generated $153 million in cash flow from
        operating activities, compared with $150 million in the prior year
        period. Net capital expenditures were $85 million and $52 million for
        the nine months ended March 31, 2014 and 2013, respectively. The company
        realized free operating cash flow of $68 million compared with $98
        million for the same period last year.

Segment Developments for the Fiscal 2014 Third Quarter

    --  Industrial segment sales of $400 million increased 13 percent from $353
        million in the prior year quarter. This increase was due to 8 percent
        growth related to the TMB acquisition, 5 percent organic growth and a 1
        percent increase due to more business days, partially offset by a 1
        percent decrease from unfavorable currency exchange.
    --  Excluding TMB, Industrial sales increased 8 percent in general
        engineering and 5 percent in transportation, partially offset by a 3
        percent decrease in aerospace and defense. General engineering increased
        due to continued demand from distribution channels and the
        transportation market benefited from increased demand in the light
        vehicle markets world-wide. Aerospace and defense reflected higher
        comparables related to government orders in the prior year quarter.
        Sales increased in all geographies. On a regional basis sales increased
        11 percent in Asia, 9 percent in Europe and 1 percent in the Americas
        due to the weather effects in North America.
    --  Industrial segment operating income was $51 million for both the current
        and prior year periods. Excluding nonrecurring charges and TMB results,
        adjusted operating income was $58 million. Industrial adjusted operating
        margin was 15.6 percent compared with 14.5 percent in the prior year.
    --  Infrastructure segment sales of $356 million increased 18 percent from
        $303 million in the prior year. The increase was driven by 16 percent
        growth related to the TMB acquisition and a 3 percent favorable impact
        from more business days, partially offset by a 1 percent decrease due to
        unfavorable currency exchange. Organic growth was flat.
    --  Excluding TMB, Infrastructure sales increased by 9 percent in energy,
        partially offset by a decrease of 6 percent in earthworks. Energy sales
        continued to improve year over year, reflecting improving demand in oil
        and gas drilling activity in the U.S., coupled with continued gains in
        production, completion and process applications. Earthworks sales
        decreased due to persistently weak underground coal and surface mining
        markets in the U.S. and China. On a regional basis sales grew 4 percent
        in Europe and 3 percent in the Americas even with the weather impacts in
        North America, partially offset by a decrease of 9 percent in Asia.
    --  Infrastructure segment operating income was $28 million, compared with
        $26 million in the same quarter of the prior year. Excluding
        nonrecurring charges and TMB results, adjusted operating income was $31
        million. Infrastructure adjusted operating margin was 10.2 percent
        compared with 8.6 percent in the prior year.

As previously disclosed, segment results were restated for certain sales reclassifications based on products and technologies.

Fiscal 2014 Year-To-Date Key Developments

    --  Sales were $2,065 million, compared with $1,918 million in the same
        period last year. Sales increased by 8 percent, driven by 6 percent
        growth related to the TMB acquisition and 2 percent increase due to more
        business days.
    --  Operating income was $185 million, compared with $206 million in the
        same period last year. Excluding nonrecurring charges and TMB results,
        adjusted operating income was $208 million. Operating margin was 9.0
        percent compared with an operating margin of 10.7 percent in the prior
        year. Adjusted operating margin was 10.7 percent.
    --  Restructuring and related charges of $5 million pre-tax or $0.04 per
        share were recorded year-to-date.
    --  EPS were $1.42, compared with the prior year period EPS of $1.76.
        Adjusted EPS was $1.74 in the current year period.

Earnings Per Diluted Share Reconciliation for the Quarter and Year-To-Date Periods ended March 31, 2014


    FY 2014                               Third    Year-
                                         Quarter   To-
                                                   Date
    -------                             -------   -----

    Reported EPS                                   $0.64          $1.42

    TMB results:

         Base operating income             (0.04)          (0.05)

         Depreciation and amortization
          step-up                           0.03           0.05
         -----------------------------      ----           ----

         On-going operating income         (0.01)            -

         Inventory step-up                  0.07           0.14

    Acquisition-related charges             0.02           0.05

    Restructuring and related
     charges                                0.02           0.04

    Tax repatriation expense                   -           0.09

    Adjusted EPS                                   $0.74          $1.74
    ============                                   =====          =====

Reconciliations of all non-GAAP financial measures are set forth in the tables attached, and corresponding descriptions are contained in the company’s report on Form 8-K, to which this news release is attached.

Outlook

The company now expects fiscal 2014 total sales growth in the range of 10 to 11 percent. TMB is estimated to contribute 7 to 8 percent sales growth. Organic sales growth is projected to range from 2 to 3 percent. Previously, the company had forecast total sales growth ranging from 12 to 13 percent, with organic sales growth ranging from 2 to 4 percent.

With one quarter remaining in fiscal 2014, Kennametal is tightening its EPS guidance to range from $2.60 to $2.70, compared with previous expectations of $2.60 to $2.75. These ranges exclude the impact of the TMB acquisition and nonrecurring items.

Below is a detail of the fiscal year 2014 guidance related to the Kennametal base business, the TMB acquisition impact and nonrecurring items.


    Fiscal Year 2014 Guidance:
    --------------------------

    KMT base business                         $2.60 - $2.70

    TMB results:

         Base operating income                $0.10 - $0.15

         Depreciation and amortization
          step-up                           ($0.07 - $0.09)

    Total on-going operations                 $2.63 - $2.76
    =========================                 =============

    Nonrecurring charges:

         TMB Inventory step-up                       ($0.14)

         Acquisition-related charges        ($0.03 - $0.06)

         Restructuring and related charges  ($0.10 - $0.15)

         Tax repatriation expense                    ($0.09)
                                                     ------

         Total nonrecurring charges         ($0.36 - $0.44)
         ==========================         ===============

The company continues to expect to generate cash flow from operations ranging from $280 million and $310 million for fiscal 2014. Based on anticipated capital expenditures of approximately $130 million to $140 million, the company expects to generate between $150 million and $170 million of free operating cash flow for the fiscal year.

Dividend Declared

Kennametal also announced that its board of directors declared a quarterly cash dividend of $0.18 per share. The dividend is payable May 28, 2014 to shareowners of record as of the close of business on May 13, 2014.

Kennametal advises shareowners to note monthly order trends, for which the company generally makes a disclosure ten business days after the conclusion of each month. This information is available via the Investor Relations section of Kennametal’s corporate website at www.kennametal.com.

The company will discuss its fiscal 2014 third quarter results in a live webcast at 10:00 a.m. Eastern Time today. This event will be broadcast live on the company’s website, www.kennametal.com. To access the webcast, select “Investor Relations” and then “Events.” A recorded replay of this event also will be available on the company’s website through June 2, 2014.

Certain statements in this release may be forward-looking in nature, or “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements that do not relate strictly to historical or current facts. For example, statements about Kennametal’s outlook for earnings, sales volumes, and cash flow for fiscal year 2014 and our expectations regarding future growth and financial performance are forward-looking statements. Any forward looking statements are based on current knowledge, expectations and estimates that involve inherent risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, our actual results could vary materially from our current expectations. There are a number of factors that could cause our actual results to differ from those indicated in the forward-looking statements. They include: economic recession; availability and cost of the raw materials we use to manufacture our products; our foreign operations and international markets, such as currency exchange rates, different regulatory environments, trade barriers, exchange controls, and social and political instability; changes in the regulatory environment in which we operate, including environmental, health and safety regulations; our ability to protect and defend our intellectual property; competition; our ability to retain our management and employees; demands on management resources; demand for and market acceptance of our products; integrating acquisitions and achieving the expected savings and synergies; business divestitures; global or regional catastrophic events; energy costs; commodity prices; labor relations; demand for and market acceptance of new and existing products; and implementation of environmental remediation matters. Many of these risks and other risks are more fully described in Kennametal’s latest annual report on Form 10-K and its other periodic filings with the Securities and Exchange Commission. We can give no assurance that any goal or plan set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. We undertake no obligation to release publicly any revisions to forward-looking statements as a result of future events or developments.

Celebrating more than 75 years as an industrial technology leader, Kennametal Inc. delivers productivity to customers seeking peak performance in demanding environments. The company provides innovative wear-resistant products, application engineering and services backed by advanced material science, serving customers in 60 countries across diverse sectors of aerospace, earthworks, energy, industrial production, transportation and infrastructure. With approximately 14,000 employees and nearly $3 billion in sales, the company realizes half of its revenue from outside North America, and 40% globally from innovations introduced in the past five years. Recognized among the “World’s Most Ethical Companies” (Ethisphere); “Outstanding Corporate Innovator” (Product Development Management Association); and “America’s Safest Companies” (EHS Today) with a focus on 100% safety, Kennametal and its foundation invest in technical education, industrial technologies and material science to deliver the promise of progress and economic prosperity to people everywhere. For more information, visit the company’s website at www.kennametal.com.


                                                               FINANCIAL HIGHLIGHTS

    CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

                                                                                           Three Months
                                                                                              Ended              Nine Months Ended

                                                                                           March 31,                 March 31,

    (in thousands, except per share amounts)                                           2014              2013             2014              2013
    ---------------------------------------                                            ----              ----             ----              ----

    Sales                                                                                    $755,242          $655,360         $2,064,986        $1,917,963

    Cost of goods sold                                                              516,287             446,865            1,420,823             1,301,673
    ------------------                                                              -------             -------            ---------             ---------

         Gross profit                                                               238,955             208,495            644,163             616,290

    Operating expense                                                               152,298             128,328            434,983             394,967

    Restructuring charges                                                             2,703                -            5,013                -

    Amortization of intangibles                                                       7,124             5,194            18,791             15,501
    ---------------------------                                                       -----             -----            ------             ------

         Operating income                                                            76,830             74,973            185,376             205,822

    Interest expense                                                                  8,883             7,504            24,001             20,430

    Other expense (income), net                                                        (561)              749              906               502
    ---------------------------                                                        ----               ---              ---               ---

         Income from continuing operations before income taxes                       68,508             66,720            160,469             184,890

         Provision for income taxes                                                  16,514             12,344            45,750             40,158
         --------------------------                                                  ------             ------            ------             ------

    Net income                                                                       51,994             54,376            114,719             144,732

    Less: Net income attributable to noncontrolling interests                         1,129               460            1,808             2,285

    Net income attributable to Kennametal                                                     $50,865           $53,916           $112,911          $142,447
    =====================================                                                     =======           =======           ========          ========

    PER SHARE DATA ATTRIBUTABLE TO KENNAMETAL SHAREOWNERS

    Basic earnings per share                                                                    $0.65             $0.68              $1.44             $1.79
    ========================                                                                    =====             =====              =====             =====

    Diluted earnings per share                                                                  $0.64             $0.67              $1.42             $1.76
    ==========================                                                                  =====             =====              =====             =====

    Dividends per share                                                                         $0.18             $0.16              $0.54             $0.48
    ===================                                                                         =====             =====              =====             =====

    Basic weighted average shares outstanding                                        78,718             79,294            78,631             79,744
    =========================================                                        ======             ======            ======             ======

    Diluted weighted average shares outstanding                                      79,744             80,619            79,622             80,912
    ===========================================                                      ======             ======            ======             ======


    CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

    (in thousands)                                                            March 31,
                                                                                 2014              June 30, 2013
    --------------                                                           ---------             -------------

     ASSETS

    Cash and cash equivalents                                                             $161,819                 $377,316

    Accounts receivable, net                                                    528,454               445,322

    Inventories                                                                 738,857               578,795

    Other current assets                                                        109,919               98,040
    --------------------                                                        -------               ------

    Total current assets                                                      1,539,049               1,499,473

    Property, plant and equipment, net                                          885,627               741,482

    Goodwill and other intangible assets, net                                 1,323,749               944,520

    Other assets                                                                126,818               115,564

    Total assets                                                                        $3,875,243               $3,301,039
    ============                                                                          ========               ==========

     LIABILITIES

    Current maturities of long-term debt and capital leases, including notes              $113,424                  $44,319

         payable

    Accounts payable                                                            203,669               190,623

    Other current liabilities                                                   272,245               232,651
    -------------------------                                                   -------               -------

    Total current liabilities                                                   589,338               467,593

    Long-term debt and capital leases                                         1,022,129               703,626

    Other liabilities                                                           329,218               317,527
    -----------------                                                           -------               -------

    Total liabilities                                                         1,940,685               1,488,746

    KENNAMETAL SHAREOWNERS' EQUITY                                            1,901,801               1,781,826

    NONCONTROLLING INTERESTS                                                     32,757               30,467

    Total liabilities and equity                                                        $3,875,243               $3,301,039
    ============================                                                          ========               ==========

    SEGMENT DATA (UNAUDITED)         Three Months
                                         Ended     Nine Months Ended

                                      March 31,        March 31,

    (in thousands)                           2014                     2013       2014  2013
    -------------                            ----                     ----       ----  ----

    Outside Sales:

    Industrial                                          $399,669             $352,793         $1,108,546          $1,023,994

    Infrastructure                        355,573                    302,567          956,440             893,969

    Total outside sales                                 $755,242             $655,360         $2,064,986          $1,917,963
    ===================                                   ======               ======           ========            ========

    Sales By Geographic Region:

    North America                                       $351,532             $289,508           $923,100            $852,675

    Western Europe                        238,260                    199,225          641,548             559,812

    Rest of World                         165,450                    166,627          500,338             505,476
                                          -------                    -------          -------

    Total sales by geographic region                    $755,242             $655,360         $2,064,986          $1,917,963
    ================================                      ======               ======           ========            ========

    Operating Income:

    Industrial                                           $51,403              $51,173           $124,441            $131,177

    Infrastructure                         28,012                    26,120           68,305             81,623

    Corporate (1)                          (2,585)                   (2,320)          (7,370)             (6,978)

    Total operating income                               $76,830              $74,973           $185,376            $205,822
    ======================                               =======              =======           ========            ========

    (1) Represents unallocated corporate expenses.

    NOTE: Previously disclosed segment results were restated for certain sales reclassifications based on products and technologies.

In addition to reported results under generally accepted accounting principles in the United States of America (GAAP), the following financial highlight tables include where appropriate, a reconciliation of adjusted results including sales, operating income and margin, net income, diluted EPS, Industrial sales, Industrial operating income and margin, Infrastructure sales, Infrastructure operating income and margin, free operating cash flow and return on invested capital (which are non-GAAP financial measures), to the most directly comparable GAAP measures. For those adjustments that are presented ‘net of tax’, the tax effect of the adjustment can be derived by calculating the difference between the pre-tax and the post-tax adjustments presented. The tax effect on adjustments is calculated by preparing an overall tax calculation including the adjustments and then a tax calculation excluding the adjustments. The difference between these calculations results in the tax impact of the adjustments.

Management believes that investors should have available the same information that management uses to assess operating performance, determine compensation and assess the capital structure of the company. These non-GAAP measures should not be considered in isolation or as a substitute for the most comparable GAAP measures. Investors are cautioned that non-GAAP financial measures utilized by the company may not be comparable to non-GAAP financial measures used by other companies. Reconciliations of all non-GAAP financial measures are set forth in the attached tables and descriptions of certain non-GAAP financial measures are contained in our report on Form 8-K to which this release is attached.


    THREE MONTHS ENDED MARCH 31, 2014 - (UNAUDITED)

    (in thousands, except percents)                 Sales    Operating Income   Net Income (2) Diluted
                                                                                                EPS
    -------------------------------                   -----    ---------------- -------------- ------

    2014 Reported Results                                          $755,242            76,830                           $50,865         $0.64

    2014 Reported Operating Margin                                       10.2 %

    TMB results:

         Base results                               (77,667)                           (7,380)                 (3,892)          (0.04)

         Depreciation & amortization step-up              -                             3,917                    2,488            0.03

         Inventory step-up                                -                             7,721                    5,769            0.07

    Acquisition-related charges                           -                             2,446                    1,703            0.02

    Restructuring and related charges                     -                             2,779                    1,747            0.02

    2014 Adjusted Results                                          $677,575                            $86,313         $58,680         $0.74
    =====================                                            ======                            =======         =======         =====

    2014 Adjusted Operating Margin                                       12.7 %
    ==============================                                       =====

    (2) Represents amounts
     attributable to Kennametal
     Shareowners.

    THREE MONTHS ENDED MARCH 31, 2014 - (UNAUDITED)

    (in thousands, except percents)                 Industrial  Infrastructure   Industrial       Infrastructure

                                                      Sales         Sales        Operating Income      Operating Income
    ---                                               -----         -----        ----------------      ----------------

    2014 Reported Results                                               $399,669                            $355,573             $51,403          $28,012

    2014 Reported Operating Margin                                                 12.9 %                                 7.9 %

    TMB results:

         Base sales and operating income               (28,394)                  (49,273)                                (2,858)          (4,522)

         Depreciation & amortization step-up                 -                        -                                 1,279            2,638

         Inventory step-up                                   -                        -                                 5,412            2,309

    Acquisition-related charges                              -                        -                                   955            1,491

    Restructuring and related charges                        -                        -                                 1,569            1,210
                                                           ---                      ---                                 -----            -----

    2014 Adjusted Results                                               $371,275                            $306,300             $57,760          $31,138
    =====================                                               ========                            ========             =======          =======

    2014 Adjusted Operating Margin                                                 15.6 %                                10.2 %
    ==============================                                                 =====                                 =====

    NINE MONTHS ENDED MARCH 31, 2014 - (UNAUDITED)

    (in thousands, except percents)                  Sales   Operating Income    Net Income (2)     Diluted
                                                                                                EPS
    -------------------------------                    -----   ----------------  --------------     ------

    2014 Reported Results                                            $2,064,986                            $185,376         $112,911        $1.42

    2014 Reported Operating Margin                                         9.0 %

    TMB results:

         Base results                              (122,493)                      (9,267)                           (3,801)          (0.05)

         Depreciation & amortization step-up               -                        5,990                             3,816            0.05

         Inventory step-up                                 -                       15,420                            11,518            0.14

    Acquisition-related charges                            -                        5,278                             3,734            0.05

    Restructuring and related charges                      -                        5,091                             3,482            0.04

    Tax repatriation expense                               -                           -                             7,170            0.09
                                                         ---                         ---                             -----            ----

    2014 Adjusted Results                                            $1,942,493                            $207,888         $138,830        $1.74
    =====================                                              ========                            ========         ========        =====

    2014 Adjusted Operating Margin                                        10.7 %
    ==============================                                        =====

    FREE OPERATING CASH FLOW       Nine Months
     (UNAUDITED)                      Ended

                                    March 31,

    (in thousands)                        2014            2013
    -------------                         ----            ----

    Net cash flow from operating
     activities                                 $153,242           $150,358

    Purchases of property, plant
     and equipment                     (85,961)           (53,808)

    Proceeds from disposals of
     property, plant and equipment         928           1,763

    Free operating cash flow                     $68,209            $98,313
    ========================                     =======            =======


    RETURN ON INVESTED CAPITAL (UNAUDITED)

    March 31, 2014 (in thousands, except percents)

    Invested Capital                                         3/31/2014                         12/31/2013                           9/30/2013                 6/30/2013                    3/31/2013                         Average
    ----------------                                         ---------                         ----------                           ---------                 ---------                    ---------                         -------

    Debt                                                                            $1,135,553                          $1,145,729                   $706,331                     $747,945                     $751,030                        $897,318

    Total equity                                             1,934,558                            1,903,304                              1,873,194                    1,812,293                      1,753,834                             1,855,437
                                                             ---------                            ---------                              ---------                    ---------                      ---------                             ---------

    Total                                                                           $3,070,111                          $3,049,033                 $2,579,525                   $2,560,238                   $2,504,864                      $2,752,755
    =====                                                                           ==========                          ==========                 ==========                   ==========                   ==========                        ========

                                                                                                          Three Months Ended

    Interest Expense                                                                           3/31/2014                           12/31/2013                 9/30/2013                    6/30/2013                         Total
    ----------------                                                                           ---------                           ----------                 ---------                    ---------                         -----

    Interest expense                                                                                                      $8,883                     $8,037                       $7,081                       $7,042                         $31,043
    ----------------                                                                                                      ------                     ------                       ------                       ------

    Income tax benefit                                                                                                                                                                                              7,792
                                                                                                                                                                                                                    -----

    Total interest expense, net of tax                                                                                                                                                                                                $23,251
                                                                                                                                                                                                                                      =======

    Net Income                                                                                 3/31/2014                           12/31/2013                 9/30/2013                    6/30/2013                         Total
    ----------                                                                                 ---------                           ----------                 ---------                    ---------                         -----

    Net income attributable to                                                                                           $50,865                    $24,209                      $37,837                      $60,818                        $173,729

         Kennametal, as reported

    Acquisition-related                                                                           1,703                               1,258                      775                          -                            3,736

         charges

    Restructuring and related                                                                     1,747                               1,733                       -                          -                            3,480

         charges

    Tax repatriation expense                                                                        -                               7,170                       -                          -                            7,170

    Noncontrolling interest                                                                       1,129                                 (42)                     721                       1,366                            3,174
                                                                                                  -----                                                                                                                  -----

    Net income, adjusted                                                                                                 $55,444                    $34,328                      $39,333                      $62,184                        $191,289
    ====================                                                                                                 =======                    =======                      =======                      =======

    Total interest expense, net of tax                                                                                                                                                                             23,251
                                                                                                                                                                                                                   ------

                                                                                                                                                                                                                                     $214,540

    Average invested capital                                                                                                                                                                                                       $2,752,755
                                                                                                                                                                                                                                     --------

    Adjusted Return on Invested Capital                                                                                                                                                                              7.8 %
                                                                                                                                                                                                                     ====

    Return on invested capital calculated utilizing net income, as reported is as follows:

    Net income attributable to Kennametal, as reported                                                                                                                                                                                       $173,729

    Total interest expense, net of tax                                                                                                                                                                                     23,251
    ----------------------------------                                                                                                                                                                                     ------

                                                                                                                                                                                                                                             $196,980

    Average invested capital                                                                                                                                                                                                               $2,752,755

    Return on Invested Capital                                                                                                                                                                                               7.2 %
    ==========================                                                                                                                                                                                               ====

SOURCE Kennametal Inc.


Source: PR Newswire



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