- Providing best in class lead times through execution of
manufacturing and operations strategy along with focused inventory
investments resulted in strong revenue growth of 17% in the quarter
and 14% organic growth; achieved $241 million in revenue
- Operational efficiencies and strong operating leverage
enabled net income of $30.5 million, up 35% over the prior-year
period
- Innovation empowered new customer wins, market share gains
and stronger brand value
- Achieved diluted EPS of $0.94 in the quarter; Diluted
Non-GAAP Cash EPS of $1.18 up 19%
- Strong financial flexibility with net debt to adjusted
EBITDA leverage ratio to 1.79x1
- 2022 outlook reaffirmed including revenue between $930
million to $950 million, approximately 8% growth at the midpoint of
range based on macroenvironment; on path to achieve strategic goal
of at least $1 billion in revenue by 2023
Helios Technologies, Inc. (NYSE: HLIO) (“Helios” or the
“Company”), a global leader in highly engineered motion control and
electronic controls technology for diverse end markets, today
reported financial results for the first quarter ended April 2,
2022. Results include the assets of BJN Technologies, LLC (“BJN”)
on January 21, 2021, NEM S.r.l. (“NEM”) on July 9, 2021 and
Shenzhen Joyonway Electronics & Technology Co., Ltd
(“Joyonway”) on October 11, 2021.
Josef Matosevic, the Company’s President and Chief Executive
Officer, commented, “We delivered another quarter of outperformance
as the Helios team continues to execute well in challenging
conditions. We are providing our customers with industry leading
delivery schedules, innovating to create higher value hence
stickier solutions to garner customer loyalty, and our sales and
engineering teams are highly engaged with customers to enable their
success. Of note, our 34% earnings growth validates the significant
operating leverage inherent in the business. With our solid cash
generation and strong balance sheet, we have the financial strength
to execute our augmented strategy to deliver accelerated growth
both organically and through acquisitions while also being very
well positioned to weather challenges presented from the global
macroenvironment.
On a run rate basis, we are well on our way of meeting our goal
to reach at least $1 billion in revenue by 2023. We reaffirm our
guidance for the full year both top and bottom line, despite the
continued macroeconomic headwinds and tougher visibility in the
second half of the year.”
He concluded, “Our recent announcement about another flywheel
acquisition of Taimi R&D, Inc. is a clear demonstration of the
continued success we are having finding high-quality bolt-on
businesses that enhance our already leading technical expertise and
fill in portfolio areas with proprietary scalable technology
solutions.”
1 On a pro-forma basis for NEM and Joyonway
First Quarter 2022 Consolidated Results
($ in millions, except per share data)
Q1 2022 Q1
2021 Change % Change Net sales
$
240.5
$
204.8
$
35.7
17
%
Gross profit
$
83.6
$
75.4
$
8.2
11
%
Gross margin
34.8
%
36.8
%
(200
)
bps Operating income
$
42.9
$
34.6
$
8.3
24
%
Operating margin
17.8
%
16.9
%
90
bps Non-GAAP adjusted operating margin
21.8
%
22.8
%
(100
)
bps Net income
$
30.5
$
22.6
$
7.9
35
%
Diluted EPS
$
0.94
$
0.70
$
0.24
34
%
Non-GAAP cash net income
$
38.3
$
31.7
$
6.6
21
%
Diluted Non-GAAP cash EPS
$
1.18
$
0.99
$
0.19
19
%
Adjusted EBITDA
$
59.0
$
51.3
$
7.7
15
%
Adjusted EBITDA margin
24.5
%
25.1
%
(60
)
bps
See the attached tables for additional important disclosures
regarding Helios’s use of non-GAAP adjusted operating income,
non-GAAP adjusted operating margin, non-GAAP cash net income,
non-GAAP cash earnings per share, adjusted EBITDA (earnings before
net interest expense, income taxes, depreciation and amortization)
and adjusted EBITDA margin (adjusted EBITDA as a percentage of
sales) as well as reconciliations of GAAP operating income to
non-GAAP adjusted operating income and non-GAAP adjusted operating
margin and GAAP net income to non-GAAP cash net income, non-GAAP
cash earnings per share, adjusted EBITDA and Adjusted EBITDA
margin. Helios believes that, when used in conjunction with
measures prepared in accordance with GAAP, the non-GAAP measures
described above help improve the understanding of its operating
performance.
Sales
- Sales reflected strong demand across most of our markets with
our mobile equipment and health and wellness end markets leading
the growth. Responsive manufacturing processes was an enabler of
growth allowing us to deliver products and solutions to customers
in a timely manner amidst supply chain constraints. Sales included
$7.2 million in revenue from acquisitions. Organic growth in the
quarter was 14%. (See the table in this release that provides
acquired revenue by segment by quarter).
- Strength in demand across the Americas and EMEA, with moderate
growth in APAC.
- Foreign currency translation adjustment on sales: $4.7 million
unfavorable.
Profits and margins
- Gross profit and margin drivers: gross profit benefitted from
increased volume during the quarter while gross margin declined by
200 basis points compared with the prior-year period, due to
increases in logistics, raw material and labor costs.
- Selling, engineering and administrative expenses: as a
percentage of sales, decreased 90 basis points to 14.0% compared
with the 2021 first quarter, reflecting both the benefit of fixed
cost leverage on higher sales partially offset by higher operating
expenses.
- Amortization of intangible assets: $7.0 million down from $10.2
million in the prior year reflecting timing related to the
Company’s acquisitions.
Non-operating items
- Net interest expense: $3.8 million in the quarter, down $1.0
million compared with the prior-year period due to lower debt
balances.
- Effective tax rate: 22.4% compared with 23.2% in the prior-year
period reflecting levels of income in varying tax
jurisdictions.
Net income, earnings per share, non-GAAP
cash earnings per share and adjusted EBITDA
- GAAP net income and diluted earnings per share: $30.5 million
and $0.94 per share, up 34%.
- Diluted Non-GAAP cash earnings per share: $1.18 compared with
$0.99 last year, up 19% due to higher sales, operational
efficiencies, and strong operating leverage.
- Adjusted EBITDA margin: 60 basis point impact to 24.5% compared
with the prior-year period as higher volume was offset by increases
in logistics expenses related to supply chain challenges, material
inflation and labor costs.
Hydraulics Segment Review
(Refer to sales by geographic region and segment data in
accompanying tables)
($ in millions)
Hydraulics
Three Months Ended Q1 2022 Q1 2021
Change % Change Net Sales Americas
$
43.1
$
34.3
$
8.8
26
%
EMEA
52.9
43.3
9.6
22
%
APAC
41.1
41.5
(0.4
)
(1
%)
Total Segment Sales
$
137.1
$
119.1
$
18.0
15
%
Gross Profit
$
50.8
$
45.4
$
5.4
12
%
Gross Margin
37.1
%
38.1
%
(100
)
bps SEA Expenses
$
19.2
$
17.3
$
1.9
11
%
Operating Income
$
31.6
$
28.1
$
3.5
13
%
Operating Margin
23.1
%
23.6
%
(50
)
bps
First Quarter Hydraulics Segment
Review
- Higher sales were driven by improved demand in the Americas and
EMEA regions, as well as many of our end markets driven by the
mobile and industrial equipment markets; foreign currency exchange
rates had a $4.5 million unfavorable adjustment on sales.
- Gross profit and margin drivers: gross profit increased $5.4
million, or 12%, compared with the same quarter of the prior year
primarily due to higher sales volume partially offset by
unfavorable foreign exchange. Gross margin reflects price increases
and fixed cost leverage on the higher sales that were more than
offset by increases in raw material, logistics and labor costs and
the unfavorable impacts from exchange rates.
- Operating income increased $3.5 million, or 13%, while
operating margin of 23.1% reflects flow through of gross margin
offset by fixed cost leverage on higher sales and disciplined cost
management.
Electronics Segment Review
(Refer to sales by geographic region and segment data in
accompanying tables)
($ in millions)
Electronics
Three Months Ended Q1 2022 Q1 2021
Change % Change Net Sales Americas
$
77.7
$
65.0
$
12.7
20
%
EMEA
11.8
9.3
2.5
27
%
APAC
13.9
11.4
2.5
22
%
Total Segment Sales
$
103.4
$
85.7
$
17.7
21
%
Gross Profit
$
32.8
$
30.0
$
2.8
9
%
Gross Margin
31.7
%
35.0
%
(330
)
bps SEA Expenses
$
12.3
$
11.7
$
0.6
5
%
Operating Income
$
20.5
$
18.3
$
2.2
12
%
Operating Margin
19.8
%
21.4
%
(160
)
bps
First Quarter Electronics Segment
Review
- Higher sales were driven by improved demand in our health and
wellness and recreational end markets, as well as successful
capacity improvement initiatives, partially offset by supply chain
constraints.
- Gross profit and margin drivers: gross profit increased $2.8
million compared with the first quarter of the prior year,
primarily due to the increased sales volume. Gross margin reflects
price increases and fixed cost leverage on higher sales that were
more than offset by increases in raw material, freight, logistics
and labor costs.
- Operating income increased $2.2 million, or 12%, while
operating margin of 19.8% reflects flow through of gross margin
offset by fixed cost leverage on higher sales and disciplined cost
management.
Balance Sheet and Cash Flow Review
- Total debt at quarter-end was $438.1 million compared with
$445.0 million at January 2, 2022, reflecting repayments, net of
borrowings, on our credit facilities of $4.3 million in the
quarter.
- Cash and cash equivalents at April 2, 2022 were $33.0 million,
up $4.5 million from the end of 2021.
- Inventory increased $14.7 million, or 8.9%, from the end of
2021 driven by the macro issues in the supply chain. These issues
include the Company purchasing parts ahead of material shortages,
holding some inventory for past due orders where one or two
components have been delayed in the supply chain, along with
customers changing shipping schedules once the Company has already
manufactured the products.
- Pro-forma net debt-to-adjusted EBITDA improved to 1.79x at the
end of the first quarter of 2022 (pro-forma for NEM and Joyonway)
compared with 1.89x (pro-forma for the NEM and Balboa acquisitions)
at the end of 2021, further demonstrating the Company’s ability to
de-lever the balance sheet following an acquisition. At the end of
2022 first quarter, the Company had $159.4 million available on its
revolving lines of credit.
- Net cash provided by operations was $14.7 million in the first
quarter 2022 compared with $15.1 million in the prior-year
period.
- Capital expenditures were $5.6 million, or approximately 2% of
sales. The Company expects to spend between 3% to 5% of sales in
capital investments in 2022.
- Paid 101st sequential quarterly cash dividend on April 20,
2022.
2022 Outlook
The Company reaffirms its expectations for 2022. This assumes
constant currency, using quarter end rates, is based on organic
growth only, and that markets served are not further impacted by
the global pandemic or the geo-political environment.
2021 Actual
2022 Outlook
Consolidated revenue
$869.2 million
$930 - $950 million
Adjusted EBITDA
$214.1 million
$219 - $238 million
Adjusted EBITDA margin
24.6%
23.5% - 25.0%
Interest expense
$16.9 million
$14 - $15 million
Effective tax rate
20.3%
21% - 23%
Depreciation
$21.4 million
$24.5 - $26.5 million
Amortization
$33.0 million
$28 - $29 million
Capital expenditures % total revenue
3%
3% - 5% of sales
Diluted Non-GAAP Cash EPS
$4.25
$4.35 - $4.60
Webcast
The Company will host a conference call and webcast tomorrow,
May 10, at 9:00 a.m. Eastern Time to review its financial and
operating results and discuss its corporate strategies and outlook.
A question-and-answer session will follow. The conference call can
be accessed by calling (201) 689-8573. The audio webcast will be
available at www.heliostechnologies.com.
A telephonic replay will be available from approximately 12:00
p.m. ET on the day of the call through Tuesday, May 17, 2022. To
listen to the archived call, dial (412) 317-6671 and enter
conference ID number 13728206. The webcast replay will be available
in the investor relations section of the Company’s website at
www.heliostechnologies.com, where a transcript will also be posted
once available.
About Helios Technologies
Helios Technologies is a global leader in highly engineered
motion control and electronic controls technology for diverse end
markets, including construction, material handling, agriculture,
energy, recreational vehicles, marine and health and wellness.
Helios sells its products to customers in over 90 countries around
the world. Its strategy for growth is to be the leading provider in
niche markets, with premier products and solutions through
innovative product development and acquisition. The Company has
paid a cash dividend to its shareholders every quarter since
becoming a public company in 1997. For more information please
visit: www.heliostechnologies.com.
FORWARD-LOOKING INFORMATION
This news release contains “forward‐looking statements” within
the meaning of Section 21E of the Securities Exchange Act of 1934.
Forward‐looking statements involve risks and uncertainties, and
actual results may differ materially from those expressed or
implied by such statements. They include statements regarding
current expectations, estimates, forecasts, projections, our
beliefs, and assumptions made by Helios Technologies, Inc.
(“Helios” or the “Company”), its directors or its officers about
the Company and the industry in which it operates, and assumptions
made by management, and include among other items, (i) the
Company’s strategies regarding growth, including its intention to
develop new products and make acquisitions; (ii) the effectiveness
of creating the Center of Engineering Excellence; (iii) the
Company’s financing plans; (iv) trends affecting the Company’s
financial condition or results of operations; (v) the Company’s
ability to continue to control costs and to meet its liquidity and
other financing needs; (vi) the declaration and payment of
dividends; and (vii) the Company’s ability to respond to changes in
customer demand domestically and internationally, including as a
result of standardization. In addition, we may make other written
or oral statements, which constitute forward-looking statements,
from time to time. Words such as “may,” “expects,” “projects,”
“anticipates,” “intends,” “plans,” “believes,” “seeks,”
“estimates,” variations of such words, and similar expressions are
intended to identify such forward-looking statements. Similarly,
statements that describe our future plans, objectives or goals also
are forward-looking statements. These statements are not
guaranteeing future performance and are subject to a number of
risks and uncertainties. Our actual results may differ materially
from what is expressed or forecasted in such forward-looking
statements, and undue reliance should not be placed on such
statements. All forward-looking statements are made as of the date
hereof, and we undertake no obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Factors that could cause the actual results to differ materially
from what is expressed or forecasted in such forward‐looking
statements include, but are not limited to, (i) supply chain
disruption and the potential inability to procure goods; (ii)
conditions in the capital markets, including the interest rate
environment and the availability of capital; (iii) inflation
(including hyperinflation) or recession; (iv) changes in the
competitive marketplace that could affect the Company’s revenue
and/or cost bases, such as increased competition, lack of qualified
engineering, marketing, management or other personnel, and
increased labor and raw materials costs; (v) risks related to
health epidemics, pandemics and similar outbreaks and similar
outbreaks, including, without limitation, the current COVID-19
pandemic, which may among other things, adversely affect our supply
chain, material costs, and work force and may have material adverse
effects on our business, financial position, results of operations
and/or cash flows; (vi) risks related to our international
operations, including the potential impact of the ongoing conflict
between Russia and Ukraine; and (vii) new product introductions,
product sales mix and the geographic mix of sales nationally and
internationally. Further information relating to factors that could
cause actual results to differ from those anticipated is included
but not limited to information under the heading Item 1. “Business”
and Item 1A. “Risk Factors” in the Company’s Form 10-K for the year
ended January 1, 2022.
This news release will discuss some historical non-GAAP
financial measures, which the Company believes are useful in
evaluating its performance. The determination of the amounts that
are excluded from these non-GAAP measures is a matter of management
judgment and depends upon, among other factors, the nature of the
underlying expense or income recognized in a given period. You
should not consider the inclusion of this additional information in
isolation or as a substitute for results prepared in accordance
with GAAP.
This news release also presents forward-looking statements
regarding non-GAAP Adjusted EBITDA, Adjusted EBITDA margin and
Diluted non-GAAP cash EPS. The Company is unable to present a
quantitative reconciliation of these forward-looking non-GAAP
financial measures to their most directly comparable
forward-looking GAAP financial measures because such information is
not available, and management cannot reliably predict the necessary
components of such GAAP measures without unreasonable effort or
expense. In addition, the Company believes that such
reconciliations would imply a degree of precision that would be
confusing or misleading to investors. The unavailable information
could have a significant impact on the Company’s 2022 financial
results. These non-GAAP financial measures are preliminary
estimates and are subject to risks and uncertainties, including,
among others, changes in connection with quarter-end and year-end
adjustments. Any variation between the Company’s actual results and
preliminary financial data set forth above may be material.
Financial Tables Follow:
HELIOS TECHNOLOGIES
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per
share data) (Unaudited)
(Unaudited)
Three Months Ended April 2, 2022
April 3, 2021 % Change Net sales
$
240,547
$
204,844
17
%
Cost of sales
156,904
129,477
21
%
Gross profit
83,643
75,367
11
%
Gross margin
34.8
%
36.8
%
Selling, engineering and administrative expenses
33,776
30,561
11
%
Amortization of intangible assets
6,980
10,198
(32
)%
Operating income
42,887
34,608
24
%
Operating margin
17.8
%
16.9
%
Interest expense, net
3,809
4,751
(20
)%
Foreign currency transaction (gain) loss, net
(924
)
464
(299
)%
Other non-operating expense (income), net
750
(1
)
NM
Income before income taxes
39,252
29,394
34
%
Income tax provision
8,774
6,807
29
%
Net income
$
30,478
$
22,587
35
%
Net income per share: Basic
$
0.94
$
0.70
34
%
Diluted
$
0.94
$
0.70
34
%
Weighted average shares outstanding: Basic
32,439
32,193
Diluted
32,565
32,345
Dividends declared per share
$
0.09
$
0.09
NM = Not meaningful
HELIOS TECHNOLOGIES
CONSOLIDATED BALANCE SHEETS (In thousands,
except per share data)
April 2, 2022 January 1, 2022 (Unaudited)
Assets Current assets: Cash and cash equivalents
$
33,019
$
28,540
Restricted cash
39
41
Accounts receivable, net of allowance for credit losses of $1,119
and $1,212
151,350
134,561
Inventories, net
180,290
165,629
Income taxes receivable
1,796
2,762
Other current assets
21,871
20,101
Total current assets
388,365
351,634
Property, plant and equipment, net
170,411
174,210
Deferred income taxes
4,183
2,934
Goodwill
452,654
459,936
Other intangible assets, net
399,946
412,759
Other assets
19,322
13,873
Total assets
$
1,434,881
$
1,415,346
Liabilities and shareholders’ equity Current liabilities:
Accounts payable
$
89,117
$
85,301
Accrued compensation and benefits
18,636
28,595
Other accrued expenses and current liabilities
29,863
28,254
Current portion of long-term non-revolving debt, net
18,141
18,125
Dividends payable
2,924
2,917
Income taxes payable
14,362
6,328
Total current liabilities
173,043
169,520
Revolving line of credit
238,932
242,312
Long-term non-revolving debt, net
179,864
183,897
Deferred income taxes
70,144
71,836
Other noncurrent liabilities
37,262
38,818
Total liabilities
699,245
706,383
Commitments and contingencies
-
-
Shareholders’ equity: Preferred stock, par value $0.001,
2,000 shares authorized, no shares issued or outstanding
-
-
Common stock, par value $0.001, 100,000 shares authorized, 32,478
and 32,407 issued and outstanding
32
32
Capital in excess of par value
395,873
394,641
Retained earnings
390,831
363,279
Accumulated other comprehensive loss
(51,100
)
(48,989
)
Total shareholders’ equity
735,636
708,963
Total liabilities and shareholders’ equity
$
1,434,881
$
1,415,346
HELIOS
TECHNOLOGIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)
(Unaudited)
Three Months Ended April 2, 2022 April 3,
2021 Cash flows from operating activities: Net income
$
30,478
$
22,587
Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation and amortization
12,554
15,237
Stock-based compensation expense
2,494
2,107
Amortization of debt issuance costs
125
125
Benefit for deferred income taxes
(1,082
)
(906
)
Forward contract gains, net
(1,577
)
(2,402
)
Other, net
696
32
(Increase) decrease in operating assets: Accounts receivable
(17,418
)
(28,051
)
Inventories
(15,471
)
(10,809
)
Income taxes receivable
938
565
Other current assets
(2,403
)
(2,614
)
Other assets
2,202
2,139
Increase (decrease) in operating liabilities: Accounts payable
4,136
13,912
Accrued expenses and other liabilities
(8,053
)
(2,147
)
Income taxes payable
8,177
6,126
Other noncurrent liabilities
(1,108
)
(819
)
Net cash provided by operating activities
14,688
15,082
Cash flows from investing activities: Acquisition of a
business, net of cash acquired
1,271
(1,000
)
Amounts paid for net assets acquired
-
(2,400
)
Capital expenditures
(5,630
)
(5,036
)
Proceeds from dispositions of equipment
1,837
35
Cash settlement of forward contracts
707
1,544
Software development costs
(874
)
(623
)
Net cash used in investing activities
(2,689
)
(7,480
)
Cash flows from financing activities: Borrowings on
revolving credit facilities
23,548
6,602
Repayment of borrowings on revolving credit facilities
(23,605
)
(8,500
)
Repayment of borrowings on long-term non-revolving debt
(4,201
)
(4,029
)
Proceeds from stock issued
600
333
Dividends to shareholders
(2,917
)
(2,891
)
Other financing activities
(2,259
)
(974
)
Net cash used in financing activities
(8,834
)
(9,459
)
Effect of exchange rate changes on cash, cash equivalents and
restricted cash
1,312
2,565
Net increase in cash, cash equivalents and restricted cash
4,477
708
Cash, cash equivalents and restricted cash, beginning of period
28,581
25,257
Cash, cash equivalents and restricted cash, end of period
$
33,058
$
25,965
HELIOS TECHNOLOGIES
SEGMENT DATA (In thousands)
(Unaudited)
Three Months Ended April 2, 2022 April 3,
2021 Sales: Hydraulics
$
137,106
$
119,106
Electronics
103,441
85,738
Consolidated
$
240,547
$
204,844
Gross profit and margin: Hydraulics
$
50,838
$
45,409
37.1
%
38.1
%
Electronics
32,805
29,958
31.7
%
35.0
%
Consolidated
$
83,643
$
75,367
34.8
%
36.8
%
Operating income (loss) and margin: Hydraulics
$
31,633
$
28,073
23.1
%
23.6
%
Electronics
20,523
18,280
19.8
%
21.4
%
Corporate and other
(9,269
)
(11,745
)
Consolidated
$
42,887
$
34,608
17.8
%
16.9
%
ORGANIC
AND ACQUIRED REVENUE (In thousands) (Unaudited)
Three Months Ended Full Year Ended Three
Months Ended April 3, July 3, October 2,
January 1, January 1, April 2,
2021
2021
2021
2022
2022
2022
Hydraulics Organic
$
119,106
$
133,039
$
128,672
$
125,200
$
506,017
$
130,691
Acquisition
-
-
4,732
5,700
10,432
6,415
Total
$
119,106
$
133,039
$
133,404
$
130,900
$
516,449
$
137,106
Electronics Organic
$
29,459
$
30,191
$
30,808
$
66,107
$
156,565
$
102,663
Acquisition
56,279
60,183
59,029
20,680
196,171
778
Total
$
85,738
$
90,374
$
89,837
$
86,787
$
352,736
$
103,441
Consolidated Organic
$
148,565
$
163,230
$
159,480
$
191,307
$
662,582
$
233,354
Acquisition
56,279
60,183
63,761
26,380
206,603
7,193
Total
$
204,844
$
223,413
$
223,241
$
217,687
$
869,185
$
240,547
HELIOS TECHNOLOGIES
ADDITIONAL INFORMATION
(Unaudited)
2022 Sales by Geographic Region and Segment ($ in
millions)
Q1 % Change y/y Americas: Hydraulics
$
43.1
26
%
Electronics
77.7
20
%
Consol. Americas
120.8
22
%
% of total
50
%
EMEA: Hydraulics
$
52.9
22
%
Electronics
11.8
27
%
Consol. EMEA
64.7
23
%
% of total
27
%
APAC: Hydraulics
$
41.1
(1
%)
Electronics
13.9
22
%
Consol. APAC
55.0
4
%
% of total
23
%
Total
$
240.5
17
%
2021 Sales by Geographic Region and Segment ($ in
millions)
Q1 % Change y/y Q2 % Change
y/y Q3 % Change y/y Q4 % Change y/y
Americas: Hydraulics
$
34.3
(8
%)
$
41.7
22
%
$
45.2
63
%
$
46.5
49
%
Electronics
65.0
201
%
64.1
378
%
64.2
200
%
$
64.5
72
%
Consol. Americas
99.3
69
%
105.8
122
%
109.4
123
%
111.0
61
%
% of total
48
%
47
%
49
%
51
%
EMEA: Hydraulics
$
43.3
29
%
$
46.6
49
%
$
44.8
40
%
$
45.3
32
%
Electronics
9.3
272
%
11.0
479
%
11.1
640
%
$
10.6
116
%
Consol. EMEA
52.6
46
%
57.6
74
%
55.9
66
%
55.9
42
%
% of total
26
%
26
%
25
%
26
%
APAC: Hydraulics
$
41.5
26
%
$
44.7
22
%
$
43.4
13
%
$
39.1
5
%
Electronics
11.4
613
%
15.3
705
%
14.5
867
%
$
11.7
92
%
Consol. APAC
52.9
53
%
60.0
55
%
57.9
45
%
50.8
17
%
% of total
26
%
27
%
26
%
23
%
Total
$
204.8
58
%
$
223.4
87
%
$
223.2
82
%
$
217.7
44
%
HELIOS TECHNOLOGIES
Non-GAAP Adjusted Operating Income
RECONCILIATION (In thousands) (Unaudited)
Three Months Ended April 2, 2022
April 3, 2021 GAAP operating income
$
42,887
$
34,608
Acquisition-related amortization of intangible assets
6,980
10,198
Acquisition and financing-related expenses
859
922
Restructuring charges
268
418
Officer transition costs
302
-
Acquisition integration costs
1,119
594
Non-GAAP adjusted operating income
$
52,415
$
46,740
GAAP operating margin
17.8
%
16.9
%
Non-GAAP adjusted operating margin
21.8
%
22.8
%
Adjusted EBITDA RECONCILIATION
(In thousands) (Unaudited)
Three Months Ended Twelve Months Ended
April 2, 2022 April 3, 2021 April 2, 2022
Net income
$
30,478
$
22,587
$
112,487
Interest expense, net
3,809
4,751
15,929
Income tax provision
8,774
6,807
28,550
Depreciation and amortization
12,554
15,237
51,718
EBITDA
55,615
49,382
208,684
Acquisition and financing-related expenses
859
922
5,678
Restructuring charges
268
418
323
Officer transition costs
302
-
619
Inventory step-up amortization
-
-
558
Acquisition integration costs
1,119
594
3,374
Change in fair value of contingent consideration
836
-
1,886
Other
-
-
626
Adjusted EBITDA
$
58,999
$
51,316
$
221,748
Adjusted EBITDA margin
24.5
%
25.1
%
24.5
%
Pre-acquisition adjusted EBITDA, NEM and Joyonway
4,334
TTM Pro forma adjusted EBITDA
$
226,082
HELIOS TECHNOLOGIES Non-GAAP
Cash Net Income RECONCILIATION (In thousands) (Unaudited)
Three Months Ended April 2, 2022
April 3, 2021 Net income
$
30,478
$
22,587
Amortization of intangible assets
7,105
10,231
Acquisition and financing-related expenses
859
922
Restructuring charges
268
418
Officer transition costs
302
-
Acquisition integration costs
1,119
594
Change in fair value of contingent consideration
836
-
Tax effect of above
(2,622
)
(3,041
)
Non-GAAP cash net income
$
38,345
$
31,711
Non-GAAP cash net income per diluted share
$
1.18
$
0.99
Net Debt-to-Adjusted EBITDA
RECONCILIATION (In thousands) (Unaudited)
As of April 2, 2022 Current portion of
long-term non-revolving debt, net
$
18,141
Revolving lines of credit
240,086
Long-term non-revolving debt, net
179,864
Total debt
438,091
Less: Cash and cash equivalents
33,019
Net debt
$
405,072
TTM Pro forma adjusted EBITDA*
$
226,082
Ratio of net debt to TTM pro forma adjusted EBITDA
1.79
*On a pro-forma basis for NEM and Joyonway
Non-GAAP Financial Measures and Non-GAAP Forward-looking
Financial Measures:
Adjusted operating income, adjusted operating margin, EBITDA,
adjusted EBITDA, adjusted EBITDA margin, net debt-to-adjusted
EBITDA, cash net income and cash net income per diluted share are
not measures determined in accordance with generally accepted
accounting principles in the United States, commonly known as GAAP.
Nevertheless, Helios believes that providing non-GAAP information
such as adjusted operating income, adjusted operating margin,
EBITDA, adjusted EBITDA, adjusted EBITDA margin, net
debt-to-adjusted EBITDA, cash net income and cash net income per
diluted share are important for investors and other readers of
Helios’s financial statements, as they are used as analytical
indicators by Helios’s management to better understand operating
performance. Because adjusted operating income, adjusted operating
margin, adjusted EBITDA, adjusted EBITDA margin, net
debt-to-adjusted EBITDA, cash net income and cash net income per
diluted share are non-GAAP measures and are thus susceptible to
varying calculations, adjusted operating income, adjusted operating
margin, EBITDA, adjusted EBITDA, adjusted EBITDA margin, net
debt-to-adjusted EBITDA, cash net income and cash net income per
diluted share, as presented, may not be directly comparable with
other similarly titled measures used by other companies.
The Company does not provide a reconciliation of forward-looking
non-GAAP financial measures, such as adjusted EBITDA, adjusted
EBITDA margin and cash net income and cash net income per diluted
share disclosed above in our 2022 Outlook, to their comparable GAAP
financial measures because it could not do so without unreasonable
effort due to the unavailability of the information needed to
calculate reconciling items and due to the variability, complexity
and limited visibility of the adjusting items that would be
excluded from the non-GAAP financial measures in future
periods.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509006031/en/
Tania Almond Vice President, Investor Relations, Corporate
Communication and Risk Management (941) 362-1333
tania.almond@HLIO.com Deborah Pawlowski Kei Advisors LLC (716)
843-3908 dpawlowski@keiadvisors.com
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