Kennametal Inc. is reducing its previously announced fiscal 2016 guidance.
The company has reported that its revenue expectations have been negatively impacted by further declines in its end markets as evidenced by continued declines in industrial production indices since prior guidance was issued in early November.
A particular impact was the declines in China automotive and US and China coal mining, as well as further reductions in O&G activity.
Currently, as a result of lower revenue expectations and the company's current lack of visibility to its end markets, it expects as much as a 30 – 60% decrease in previously announced guidance for fiscal 2016 adjusted earnings per diluted share.
The company will provide more detail at the time of the February 2016 Earnings call.
Don Nolan, President and CEO, stated: "Our served end markets are experiencing significant volatility and we are being challenged by the current global macroeconomic environment. As a result, our visibility into our end markets is poor and we have decided to reduce guidance for fiscal 2016. In this difficult time of end-market weakness, we will focus on controlling what we can control by tightly managing our costs and working capital, while not losing the capability to respond when the markets recover. We will continue to update our investors with changing trends throughout the remainder of the fiscal year."
Nolan continued: "Despite weak market conditions, we continue to make meaningful progress on critical initiatives to strengthen our foundation and ultimately grow our business, which we will outline in our meeting with investors tomorrow. When market conditions improve, we are confident that Kennametal will deliver substantially improved results."
Edited from press release by Harleigh Hobbs
Read the article online at: https://www.worldcoal.com/mining/16122015/kennametal-reduces-fiscal-2016-outlook-3299/