Item 2.02 Results of Operations and Financial Condition

On April 26, 2012, Kennametal Inc. (Kennametal or the Company) issued an earnings announcement for its fiscal third quarter ended March 31, 2012.

The press release contains certain non-generally accepted accounting principles (GAAP) financial measures. The following GAAP financial measures have been presented on an adjusted basis: sales, operating income and margin, Industrial operating income and margin and Infrastructure sales, operating income and margin. Adjustments include the impact of the acquisition for the three months ended March 31, 2012 and restructuring and related charges for the three months ended March 31, 2011. Management adjusts for these items in measuring and compensating internal performance and to more readily compare the Company's financial performance period-to-period. The press release also contains free operating cash flow and adjusted return on invested capital (ROIC), which are both non-GAAP measures and are defined below.

Management believes that presentation of these non-GAAP financial measures provides useful information about the results of operations of the Company for the current and past periods. Management believes that investors should have available the same information that management uses to assess operating performance, determine compensation and assess the capital structure of the Company. These non-GAAP measures should not be considered in isolation or as a substitute for the most comparable GAAP measures. Investors are cautioned that non-GAAP financial measures utilized by the Company may not be comparable to non-GAAP financial measures used by other companies.

Free Operating Cash Flow

Free operating cash flow is a non-GAAP financial measure and is defined by the Company as cash provided by operations (which is the most directly comparable GAAP measure) less capital expenditures plus proceeds from disposals of fixed assets. Management considers free operating cash flow to be an important indicator of Kennametal's cash generating capability because it better represents cash generated from operations that can be used for dividends, debt repayment, strategic initiatives (such as acquisitions), and other investing and financing activities.

Adjusted Return on Invested Capital

Adjusted Return on Invested Capital is a non-GAAP financial measure and is defined by the Company as the previous 12 months' net income, adjusted for interest expense, noncontrolling interest expense and special items, divided by the sum of the previous five quarters average balances of debt and total equity. The most directly comparable GAAP measure is return on invested capital calculated utilizing GAAP net income. Management believes that this financial measure provides additional insight into the underlying capital structure and performance of the Company. Management utilizes this non-GAAP measure in determining compensation and assessing the operations of the Company.

A copy of the Company's earnings announcement is furnished under Exhibit 99.1 attached hereto. Reconciliations of the above non-GAAP financial measures are included in the earnings announcement.

Additionally, during our quarterly earnings teleconference we may use various non-GAAP financial measures to describe the underlying operating results. Accordingly, we have compiled below certain reconciliations as required by Regulation G. These non-GAAP measures should not be considered in isolation or as a substitute for the most comparable GAAP measures. Investors are cautioned that non-GAAP financial measures utilized by the Company may not be comparable to non-GAAP financial measures used by other companies.

THREE MONTHS ENDED MARCH 31, 2012 (UNAUDITED)



                                                       Operating       Operating
       (in thousands, except percents)     Sales         Income         Margin
       2012 Reported Results             $ 696,411     $  103,292            14.8 %
       Acquisition impact                   22,558          4,608

       2012 Adjusted Results             $ 673,853     $  107,900            16.0 %

Debt to Capital

Debt to Capital is a non-GAAP financial measure and is defined by Kennametal as total debt divided by the sum of total equity plus total debt. The most directly comparable GAAP measure is debt to equity, which is defined as total debt divided by total equity. Management believes that Debt to Capital provides additional insight into the underlying capital structure and performance of the Company.

           DEBT TO CAPITAL (UNAUDITED)        March 31,        June 30,
           (in thousands, except percents)      2012             2011
           Total debt                        $   640,871      $   312,882
           Total equity                        1,745,699        1,658,641

           Debt to equity, GAAP                     36.7 %           18.9 %

           Total debt                        $   640,871      $   312,882
           Total equity                        1,745,699        1,658,641

           Total capital                     $ 2,386,570      $ 1,971,523

           Debt to capital                          26.9 %           15.9 %

(d) Exhibits

99.1 Fiscal 2012 Third Quarter Earnings Announcement