Kennametal Inc., Latrobe, PA, reported second quarter sales of $569 million, a decrease of 12% from the same quarter a year ago. Profit was $15.7 million, down 68.7%.
For the first six months of fiscal year 2009, sales were down 1.6% to $1.23 billion. Profit was down 39.9% to $51.1 million.
"Kennametal has made solid progress in executing strategies to balance our businesses across served geographies and end markets. However, we are not immune to the rapid and significant global decline in industrial production that has taken place over the past few months," said President and CEO Carlos Cardoso. "As a result, we continue to take actions to reduce our costs and right size our business in line with current economic conditions while minimizing the impact of such on our customers."
Kennametal continued to implement restructuring plans to reduce costs and improve efficiencies in its operations. Those plans include the previously announced elimination of 1,200 positions.
Metalworking Solutions & Services Group sales decreased 21% during the quarter, driven primarily by an organic sales decline of 15%, unfavorable foreign currency effects of 5% and 1% from the impact of divestitures. Demand in most industry and market sectors has weakened.
On a regional basis, Europe and India reported organic sales declines of 17% each. North America experienced a decline of 16%. Asia Pacific and Latin America also experienced organic sales declines of 9% and 2%, respectively.
Advanced Materials Solutions Group sales increased 5% during the quarter: 8% from the impact of acquisitions was partially offset by a negative 3% from unfavorable foreign currency effects. Organic sales were flat as increased mining and construction sales and higher energy-related sales were offset by lower sales of engineered products.