Kadant (KAI) investor relations material

Business model and strategic positioning

• Over 70% of revenue comes from aftermarket parts and consumables, supporting recurring revenue and strong customer relationships.

• Operates a decentralized, asset-light model with a focus on sustainable industrial processing technologies.

• Global presence with $656M revenue from North America, $242M from Europe, $88M from Asia, and $66M from the rest of the world in FY 2025.

• Balanced end-market exposure: 38% general industrial, 22% wood processing, 20% packaging, 20% paper.

• Strategic growth driven by secular trends, infrastructure investment, and the circular economy.

Operating segments and markets

• Three main segments: Flow Control (36% of 2025 revenue), Industrial Processing (39%), and Material Handling (25%).

• Flow Control serves packaging, paper, tissue, converting, energy, food & beverage, defense, and specialty machinery.

• Industrial Processing targets packaging, corrugated, tissue, pulp, OSB, lumber, and mass timber markets.

• Material Handling focuses on aggregates, recyclers, waste management, cement, copper, food, waste-to-energy, paper, and pharma.

Growth drivers and market trends

• Growth supported by decarbonization, electrification, automation, robotics, AI, and digitalization.

• E-commerce and home delivery are increasing demand for packaging and containerboard, with U.S. e-commerce sales projected to grow 9% annually through 2029.

• Regulatory and societal shifts are driving migration from plastics to cellulose-based, recyclable materials.

• Robust demand for lumber and engineered wood, with increased use of cross-laminated timber in construction.

• Infrastructure investments and digitalization initiatives are fueling demand for efficient material handling and smart industrial solutions.