Tag - KAI

Adept Technology Inc (Nasdaq:ADEP), Kandant Inc (Nasdaq:KAI), Perfumania Holdings Inc (Nasdaq:PERF) and Beasley Broadcast Group Inc (Nasdaq:BBGI) are among the biggest percentage Gainers in Thursday's trading among companies with market capitalizations under $1 billion.

Kadant Inc. (NYSE:KAI) CEO Bill Rainville said the world economy remains more challenging than the company, which supplies equipment to the papermaking and recycling industries, originally envisioned for the second half of the year. Rainville made the comments during a midday Thursday conference call with investors and analysts.

“Several large projects in Asia on which we had expected to recognize revenue in 2008 have been pushed into 2009 and a few China projects have been shelved, although none of these were in our backlog,” Rainville said. “Some economists have suggested signs of a moderate cooling in Europe’s economy as well. These events have caused us to reevaluate our outlook for the second half of the year but we remain optimistic about our performance and prospects in a challenging business environment.”

Kadant said in a release that it expects third-quarter GAAP earnings from continuing operations to range from $0.36 to $0.38 per share on revenue of between $86 million and $88 million. The outlook falls shy of Wall Street’s expectation of earnings of $0.52 per share on revenue of $102 million.

There are four major factors that benefit Kadant during a slower economy, the chief executive said. First, the company’s consumables and parts business, which makes up about half of sales, is stable during slowdowns, he said. Second, Kadant is geographically diverse. Third, the firm’s global manufacturing and sourcing capabilities allow Kadant to manage its cost as currencies and other factors change costs from region to region, he said. Finally, he said Kadant has a strong balance . . .

Kadant Inc. (NYSE:KAI) CEO Bill Rainville said the world economy remains more challenging than the company, which supplies equipment to the papermaking and recycling industries, originally envisioned for the second half of the year. Rainville made the comments during a midday Thursday conference call with investors and analysts.

“Several large projects in Asia on which we had expected to recognize revenue in 2008 have been pushed into 2009 and a few China projects have been shelved, although none of these were in our backlog,” Rainville said. “Some economists have suggested signs of a moderate cooling in Europe’s economy as well. These events have caused us to reevaluate our outlook for the second half of the year but we remain optimistic about our performance and prospects in a challenging business environment.”

Kadant said in a release that it expects third-quarter GAAP earnings from continuing operations to range from $0.36 to $0.38 per share on revenue of between $86 million and $88 million. The outlook falls shy of Wall Street’s expectation of earnings of $0.52 per share on revenue of $102 million.

There are four major factors that benefit Kadant during a slower economy, the chief executive said. First, the company’s consumables and parts business – which makes up about half of sales – is stable during slowdowns, he said. Second, Kadant is geographically diverse. Third, the firm’s global manufacturing and sourcing capabilities allow Kadant to manage its cost as currencies and other factors change costs from region to region, he said. Finally, he said Kadant has a strong balance sheet and access to capital that allows the company to pursue acquisitions.

The old-fashioned business of making paper may seem an unlikely investment choice for the e-age. But Kadant Inc. (NYSE: KAI), which makes the machinery that makes paper, also makes money. It beats pulp into cold hardboiled cash.

By grabbing overseas opportunities and establishing profitable acquisitions, Westford, Mass.-based Kadant has raised its earnings guidance for the year, and will end 2007 with plenty of financial flexibility. Barring a global slowdown, the company is expected to grow earnings 13% in 2008 as it continues to expand overseas—particularly in China—and retool aged equipment in North America.

Kadant’s technology-based systems prepare stock by recovering usable fiber from recycled materials and by preparing virgin fiber for entry into the paper machinery. It also sells paper machine accessories, as well as water-management systems that clean and condition papermaking fabrics. Its fluid-handling systems are used in the steel, rubber, plastics, food and textile industries.

Selling into the global pulp and paper industry, Kadant—in addition to China—is growing elsewhere in Asia and in Eastern Europe, concentrating on Russia. Although these are the key growth areas—Kadant does about 60% of its business overseas—there’s also demand in North America as companies upgrade systems to ease the impact of high energy prices.

“We believe (Kadant) continues to be on a growth track because of its strong position in China, as well as solid demand for its products that reduce energy and water usage,” Standard & Poor’s analysts said after third-quarter results were released in late October. Kadant will continue to grow in 2008 due to its solid presence in China, where significant new linerboard capacity is being added, S&P said.

Plus, high energy costs in North America are likely to boost demand for Kadant’s fluid handling products and software that improve dryer operations. S&P noted that the company is also working to boost sales of products outside the paper industry.