Kennametal Inc. (KMT) announced in a recent regulatory filing that it is implementing several strategic measures to enhance its long-term competitiveness. These actions align with commitments made during its Investor Day on September 8, 2023, and involve plans to close between three to five plants by the conclusion of Fiscal 2027.
In the Metal Cutting segment, Kennametal intends to close its Greenfield, MA facility and consolidate two sites near Barcelona, Spain, into a single modern facility. The operations at the Greenfield location are expected to end by April 2025, with the closure largely completed by December 31, 2025. The Barcelona facilities' consolidation is anticipated to be mostly finalized by June 30, 2025.
Additionally, in response to challenging market conditions, particularly in Europe, Kennametal is launching a global initiative to reduce structural expenses primarily through a decrease in professional workforce. These combined actions are projected to achieve approximately $15 million in annual pre-tax savings by the end of Fiscal 2025.
The company estimates incurring about $25 million in pre-tax charges to execute these initiatives, which include approximately $10 million for cash-related facility costs, $10 million for severance-related cash payments, and $5 million for non-cash facility charges.
