), within a few days after releasing its fourth quarter and
fiscal year 2013 results, announced the successful completion of
the acquisition of operating assets of Comercializadora Emura
S.R.L. and certain related entities (Emura). The deal was
originally announced in May, 2013.
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Addition of Emura will enable Kennametal to diversify and balance
its tungsten sourcing capabilities. The acquisition is expected
to be immediately accretive to earnings. Financial terms have
been kept under wraps.
Kennametal has over time preferred accretive acquisitions and
dispositions of non-core assets as its primary tool as it
progresses on a growth strategy of shifting its business
portfolio toward favored growth markets.
Prior to Emura, the acquisition of Deloro Stellite Holdings in
2012 deserves special mention. The acquired assets have been
integrated into Kennametal's Infrastructure segment and have
strengthened the company's product portfolio offered under the
segment. In fiscal 2013, the Stellite acquisition contributed
roughly 6% to total revenue growth and $0.03 per share accretion
A little discussion on Kennametal's recently reported quarter
results has been provided below:
Considering both the top-line and the bottom-line, results have
been weak for Kennametal in the fourth quarter and fiscal year
2013 due to considerable decrease in organic revenue and negative
impacts from foreign currency translation. Major operating areas
including Americas, Europe and Asia exhibited revenue declines.
Talking of the company's long-term debt which currently stands at
$704 million, further increase will likely raise the company's
financial obligations and, hence, prove detrimental to the
In the last 30 days, the Zacks Consensus Estimate for Kennametal
has been revised down by 6.5% to $3.01 for fiscal 2014 and
lowered by 4.3% to $3.57 for fiscal 2015.
Kennametal Inc. currently has a market capitalization of $3.5
billion. The stock carries a Zacks Rank #5 (Strong Sell). Other
stocks in the same space include
Lincoln Electric Holdings Inc.
) - reported adjusted earnings of 91 cents per share, up 12% year
over year and ahead of the Zacks Consensus Estimate of 90 cents,
Blount International Inc.
) - is expected to release its figures on Aug 7, 2013, and
) - with earnings figures expected to release on Aug 8, 2013.