Kadant Inc. Reports Record Fourth Quarter Revenue and Strong Cash Flow for Fiscal Year 2025

WESTFORD, Mass., February 18, 2026 – Kadant Inc. (NYSE: KAI), a global supplier of technologies and engineered systems that drive Sustainable Industrial Processing®, today reported financial results for the fourth quarter and fiscal year ended January 3, 2026.

🔹 Fourth Quarter 2025 Highlights

• Revenue: Increased 11% to a record $286.2 million (vs. $258.0 million in Q4 2024)

  • +8% from acquisitions

  • +3% from favorable foreign currency translation

• Gross Margin: 43.9% (up 50 basis points)

• Net Income: $24.0 million (flat year-over-year)

• GAAP EPS: $2.04 (flat YoY)

• Adjusted EPS: $2.27 (up 1%)

• Adjusted EBITDA: $58.0 million (up 11%), representing 20.3% of revenue

• Operating Cash Flow: $60.8 million (up 17%)

• Free Cash Flow: $54.7 million (up 18%)

• Bookings: $270.0 million (up 12%)

  • Organic bookings up 1%

Management credited strong execution and contributions from recent acquisitions for record revenue and solid cash generation despite a challenging macro environment.

🔹 Fiscal Year 2025 Highlights

• Revenue: $1.052 billion (flat vs. record $1.053 billion in FY2024)

  • Organic revenue declined 4%

  • +3% from acquisitions

  • +1% from FX translation

• Gross Margin: 45.2% (up 90 basis points)

• Net Income: $102.0 million (down 9%)

• GAAP EPS: $8.65 (down 9%)

• Adjusted EPS: $9.26 (down 10%)

• Adjusted EBITDA: $216.3 million (down 6%), margin 20.6%

• Operating Cash Flow: Record $171.3 million (up 10%)

• Free Cash Flow: Record $154.3 million (up 15%)

• Bookings: Record $1.034 billion (up 5%)

  • Organic bookings up 1%

The company maintained margin strength and record cash generation despite softer organic revenue trends.

🔹 Segment Performance (FY2025)

• Flow Control

  • Revenue: $382.9 million (+3%)

  • Gross Margin: 52.3%

  • Adjusted EBITDA: $106.4 million

• Industrial Processing

  • Revenue: $409.5 million (–5%)

  • Gross Margin: 43.0%

  • Adjusted EBITDA: $97.3 million

• Material Handling

  • Revenue: $259.9 million (+4%)

  • Gross Margin: 38.1%

  • Adjusted EBITDA: $57.0 million

Parts and consumables represented 71% of revenue and 72% of bookings in FY2025, highlighting the strength of recurring aftermarket demand.

🔹 Capital Expenditure & Cash Deployment

• Q4 Capital Expenditures: $6.1 million

• FY2025 Capital Expenditures: $17.0 million (vs. $21.0 million in FY2024)

• Strong free cash flow supports:

  • Acquisition strategy

  • Debt repayments

  • Strategic investments

Total debt obligations stood at $372.7 million as of January 3, 2026 (vs. $286.5 million at year-end 2024).

🔹 Restructuring, Impairments & Other Costs

During FY2025, the company recorded:

• Land remediation costs: $871,000

• Restructuring costs: $155,000

• Impairment costs: $287,000

These were primarily within the Industrial Processing segment.

🔹 Acquisition Activity

Acquisitions contributed:

• $21.9 million in Q4 revenue

• $36.7 million in FY2025 revenue

The company continues to execute its acquisition strategy as a key growth driver.

🔹 2026 Outlook

Management expressed optimism entering 2026, citing improving business activity and strengthening capital project bookings.

Full Year 2026 Guidance:

• Revenue: $1.160 – $1.185 billion

• GAAP EPS: $10.27 – $10.62

• Adjusted EPS: $10.40 – $10.75

Q1 2026 Guidance:

• Revenue: $270 – $280 million

• GAAP EPS: $1.69 – $1.79

• Adjusted EPS: $1.78 – $1.88

The outlook reflects steady aftermarket demand, a strong balance sheet, and robust cash flow generation.