Exhibit 99.1

img252001787_0.jpg 

NEWS

RELEASE

 

FOR IMMEDIATE RELEASE

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

Strong organic sales growth of 30% in the quarter driven by high demand, operational flexibility, diversified end markets, and new products
Executed well against supply chain constraints and material costs; Net income grew to $27.8 million, up 114% over the prior-year period
Adjusted EBITDA1 margin expanded 170 basis points over prior-year period to 25.1%
Diluted EPS of $0.86 up 115% from last year; Non-GAAP Cash EPS of $1.07 up 102%
Generated $32.5 million of cash from operations and $25.7 million of free cash flow; further reduced net debt to adjusted EBITDA leverage ratio to 2.0x2
Raising revenue and Non-GAAP Cash EPS expectations for fiscal 2021 and holding margins reflecting strong results year-to-date in continued challenging environment amidst robust demand

SARASOTA, FL, November 8, 2021 — 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 third quarter ended October 2, 2021. Results include the acquisitions of BWG Holdings I Corp. (known as “Balboa Water Group” or “Balboa acquisition”), on November 6, 2020, and NEM S.r.l. (“NEM”) on July 9, 2021.

Josef Matosevic, the Company’s President and Chief Executive Officer, commented, “We continue to outperform the market due to excellent execution by the Helios team. Our consistent strong results are driven by our strategic initiatives to protect our business, leverage our manufacturing footprint, advance our innovation pipeline and diversify our markets. We are mitigating the challenges related to material shortages while protecting our margins with our manufacturing strategy. As a result, we have been able to hold our lead times and gain market share because of our ability to deliver. In fact, we furthered our ‘in the region for the region’ approach with the acquisition of assets of Joyonway in October. This is a fast-growing developer of control panels, software, systems and accessories for the health and wellness industry that operates in two locations in China, which are in the hub of electronics and software development for that country.”

He concluded, “Through all of this, we are staying true to our focus as a pure electronics and hydraulics business that delivers high-quality innovative products to our customers. We are evolving and leveraging our businesses to bring more unified system solutions to the market. We have expanded our engineering capacity and are developing additional internal capabilities to ‘make versus buy’ and remain focused on continuing to create value for our customers.”

 

1 Adjusted EBITDA is a non-GAAP measure. See comments regarding the use of non-GAAP measures and the reconciliation of GAAP to non-GAAP measures in the tables of this release

2 On a pro-forma basis for Balboa Water Group and NEM

 

Helios Technologies | 7456 16th St East | Sarasota, FL 34243 | 941-362-1200

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 2

Third Quarter 2021 Consolidated Results

($ in millions, except per share data)

Q3 2021

 

 

Q3 2020

 

 

Change

 

 

% Change

 

Net sales

$

223.2

 

 

$

122.6

 

 

$

100.6

 

 

 

82

%

Gross profit

$

80.9

 

 

$

46.9

 

 

$

34.0

 

 

 

72

%

Gross margin

 

36.2

%

 

 

38.3

%

 

 

(210

)

bps

 

 

Operating income

$

40.7

 

 

$

18.3

 

 

$

22.4

 

 

 

122

%

Operating margin

 

18.2

%

 

 

14.9

%

 

 

330

 

bps

 

 

Non-GAAP adjusted operating margin

 

22.5

%

 

 

19.3

%

 

 

320

 

bps

 

 

Net income

$

27.8

 

 

$

13.0

 

 

$

14.8

 

 

 

114

%

Diluted EPS

$

0.86

 

 

$

0.40

 

 

$

0.46

 

 

 

115

%

Non-GAAP cash net income

$

34.8

 

 

$

17.0

 

 

$

17.8

 

 

 

105

%

Non-GAAP cash EPS

$

1.07

 

 

$

0.53

 

 

$

0.54

 

 

 

102

%

Adjusted EBITDA

$

55.9

 

 

$

28.7

 

 

$

27.2

 

 

 

95

%

Adjusted EBITDA margin

 

25.1

%

 

 

23.4

%

 

 

170

 

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 all markets, in particular agriculture, construction equipment, recreation and health & wellness. Results included $63.8 million in sales from acquisitions. (See the table in this release that provides acquired revenue by segment by quarter). In addition, the Company experienced strong organic sales growth of $36.9 million, 30.1%, compared with the prior-year period.
Strength in demand across all regions as markets recovered from the impacts of the COVID-19 pandemic.
Foreign currency translation adjustment on sales: $1.1 million favorable.

Profits and margins

Gross profit and margin drivers: gross profit benefitted from increased volume during the quarter. Gross margin declined by 210 basis points compared with the prior-year period, as manufacturing labor efficiencies and improved leverage of our fixed cost base on the higher sales were offset by increases in logistics and raw material costs. In addition, the business model of the Balboa acquisition has lower gross margins but higher operating margins.
Selling, engineering and administrative (“SEA”) expenses: as a percentage of sales, improved 490 basis points to 14.7% compared with the 2020 third quarter, reflecting both the business model of the Balboa acquisition and continued cost management initiatives.
Amortization of intangible assets: $7.4 million was up from $4.6 million in the prior year reflecting the Company’s acquisitions.

Non-operating items

Net interest expense: $3.8 million in the quarter, up $1.1 million compared with the prior-year period due to higher debt balances.
Effective tax rate: 25.5% compared with 20.7% in the prior-year period due to a reduction in available tax incentives and increased earnings in higher tax jurisdictions such as Italy, Germany, and Australia.

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 3

Net income, earnings per share, non-GAAP cash earnings per share and adjusted EBITDA

GAAP net income and earnings per share: $27.8 million and $0.86 per share.
Non-GAAP cash earnings per share: $1.07 compared with $0.53 last year due to strong demand, operational efficiencies, and better-than-expected performance of the Balboa acquisition.
Adjusted EBITDA margin: improved 170 basis points to 25.1% compared with the prior-year period due to higher volume and operational efficiencies.

Year-to-date 2021 Consolidated Results

($ in millions, except per share data)

2021

 

 

2020

 

 

Change

 

 

% Change

 

Net sales

$

651.5

 

 

$

371.4

 

 

$

280.1

 

 

 

75

%

Gross profit

$

238.5

 

 

$

143.5

 

 

$

95.0

 

 

 

66

%

Gross margin

 

36.6

%

 

 

38.6

%

 

 

(200

)

bps

 

 

Operating income

$

117.4

 

 

$

25.0

 

 

$

92.4

 

 

 

370

%

Operating margin

 

18.0

%

 

 

6.7

%

 

 

1130

 

bps

 

 

Non-GAAP adjusted operating margin

 

22.8

%

 

 

19.7

%

 

 

310

 

bps

 

 

Net income

$

81.0

 

 

$

8.7

 

 

$

72.3

 

 

NM

 

Diluted EPS

$

2.51

 

 

$

0.27

 

 

$

2.24

 

 

NM

 

Non-GAAP cash net income

$

105.1

 

 

$

52.7

 

 

$

52.4

 

 

 

99

%

Non-GAAP cash EPS

$

3.26

 

 

$

1.64

 

 

$

1.62

 

 

 

99

%

Adjusted EBITDA

$

164.7

 

 

$

86.1

 

 

$

78.6

 

 

 

91

%

Adjusted EBITDA margin

 

25.3

%

 

 

23.2

%

 

 

210

 

bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NM = Not meaningful

 

 

 

 

 

 

 

 

 

 

 

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 growth reflected strong demand across all regions and markets, in particular agriculture, construction equipment, recreation, and health & wellness. Results included $180.2 million in sales related to acquisitions. (See the table in this release that provides acquired revenue by segment by quarter). In addition, the Company experienced significant organic growth, $99.9 million, 26.9%, compared with the 2020 period.
Foreign currency translation adjustment on sales: $13.8 million favorable.

Profits and margins

Gross profit and margin drivers: gross profit benefitted from increased volume during the period. Gross margin declined by 200 basis points compared with the prior-year period, as manufacturing labor efficiencies and improved leverage of our fixed cost base on the higher sales were offset by increases in logistics and raw material costs. In addition, the business model of the Balboa acquisition has lower gross margins but higher operating margins.
Selling, engineering and administrative (“SEA”) expenses: 14.7% as a percentage of sales, improved 500 basis points compared with the prior-year period, reflecting both the lower SEA expenses relative to sales for the Balboa acquisition and continued cost containment initiatives.

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 4

Amortization of intangible assets: increased $12.0 million to $25.3 million from the prior year reflecting the Balboa acquisition.
Goodwill impairment charge: last year’s first quarter included a $31.9 million impairment charge resulting from weakened market outlook primarily due to the COVID-19 pandemic.

Non-operating items

Net interest expense: $4.4 million increase to $13.0 million compared with the prior-year period reflecting higher debt balances.
Effective tax rate: 22.0% compared with 16.9% in the prior year, excludes non-taxable goodwill impairment charge, included certain one-time benefits in the second quarter of 2020 that reduced the effective tax rate for the period.

Net income, earnings per share, non-GAAP cash earnings per share and adjusted EBITDA

GAAP net income and earnings per share: $81.0 million and $2.51 per share.
Non-GAAP cash earnings per share: $3.26 compared with $1.64 in the prior-year period driven by strong demand, operational efficiencies and strong performance of the Balboa acquisition.
Adjusted EBITDA margin: 25.3%, up 210 basis points compared with the prior-year period due to higher volume and operational efficiencies.

Hydraulics Segment Review

(Refer to sales by geographic region and segment data in accompanying tables)

($ in millions)

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

Three Months Ended

 

 

 

 

 

 

 

 

 

Q3 2021

 

 

Q3 2020

 

 

Change

 

 

% Change

 

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

Americas

$

45.2

 

 

$

27.7

 

 

$

17.5

 

 

 

63

%

 

EMEA

 

44.8

 

 

 

32.1

 

 

 

12.7

 

 

 

40

%

 

APAC

 

43.4

 

 

 

38.4

 

 

 

5.0

 

 

 

13

%

 

Total Segment Sales

$

133.4

 

 

$

98.2

 

 

$

35.2

 

 

 

36

%

 

Gross Profit

$

50.2

 

 

$

35.5

 

 

$

14.7

 

 

 

41

%

 

Gross Margin

 

37.6

%

 

 

36.1

%

 

 

150

 

bps

 

 

 

SEA Expenses

$

18.4

 

 

$

16.6

 

 

$

1.8

 

 

 

11

%

 

Operating Income

$

31.8

 

 

$

18.9

 

 

$

12.9

 

 

 

68

%

 

Operating Margin

 

23.8

%

 

 

19.2

%

 

 

460

 

bps

 

 

 

Third Quarter Hydraulics Segment Review

Higher sales in all regions were driven by demand from U.S. and European agriculture and construction equipment markets, as well as mobile and industrial equipment markets; foreign currency exchange rates had a $1.0 million favorable adjustment on sales.
Gross margin of 37.6%, up 150 basis points, was driven by improved leverage on higher volume, production labor efficiencies and a favorable sales mix.
Operating margin of 23.8% improved 460 basis points, reflecting disciplined cost management efforts.

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 5

Electronics Segment Review

(Refer to sales by geographic region and segment data in accompanying tables)

($ in millions)

 

 

 

 

 

 

 

 

 

 

Electronics

Three Months Ended

 

 

 

 

 

 

 

 

Q3 2021

 

 

Q3 2020

 

 

Change

 

 

% Change

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

Americas

$

64.2

 

 

$

21.4

 

 

$

42.8

 

 

 

200

%

EMEA

 

11.1

 

 

 

1.5

 

 

 

9.6

 

 

 

640

%

APAC

 

14.5

 

 

 

1.5

 

 

 

13.0

 

 

 

867

%

Total Segment Sales

$

89.8

 

 

$

24.4

 

 

$

65.4

 

 

 

268

%

Gross Profit

$

31.3

 

 

$

11.4

 

 

$

19.9

 

 

 

175

%

Gross Margin

 

34.9

%

 

 

46.8

%

 

 

(1190

)

bps

 

 

SEA Expenses

$

12.9

 

 

$

6.7

 

 

$

6.2

 

 

 

93

%

Operating Income

$

18.4

 

 

$

4.7

 

 

$

13.7

 

 

 

291

%

Operating Margin

 

20.5

%

 

 

19.2

%

 

 

130

 

bps

 

 

Third Quarter Electronics Segment Review

Higher sales included $59.0 million related to the acquisition of Balboa. Strong demand from health and wellness and recreational markets drove sales, partially offset by supply chain constraints.
Gross margin reflects the different business model of the Balboa acquisition, which has lower gross margins that are offset by a lower SEA expense structure. Additionally, raw material, freight and logistics costs increased as a result of materials shortages and efforts to meet customer requirements on a timely basis.
Operating margin of 20.5% demonstrates the business model of the Balboa acquisition, which has an inherently lower operating expense structure and higher volume than the organic business. SEA expenses increased due to the incremental expenses from the acquisition.

Balance Sheet and Cash Flow Review

Total debt at quarter-end was $471.2 million compared with $462.4 million at January 2, 2021.
Cash and cash equivalents at October 2, 2021 were $47.7 million, up $22.5 million from the end of 2020.
Inventory increased $37.8 million from the end of 2020 as the Company continues to purchase parts ahead of material shortages.
Pro-forma net debt-to-adjusted EBITDA improved to 2.0x at the end of the third quarter 2021 compared with 3.0x (pro-forma for Balboa and NEM) at the end of 2020, further demonstrating the Company’s ability to rapidly de-lever the balance sheet following an acquisition. At the end of the third quarter 2021, the Company had $120.9 million available on its revolving lines of credit.
Net cash provided by operations was $32.5 million in the third quarter 2021 compared with $36.7 million in the prior-year period.
Capital expenditures were $6.7 million in the quarter. The Company expects to spend between$25 to $27 million in capital investments in 2021.

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 6

2021 Outlook

The following provides the Company’s expectations for 2021. This assumes constant currency, using quarter end rates, and that markets served are not further impacted by the global pandemic.

 

Previous 2021
Guidance provided on 8/9/21

Updated 2021
Guidance

% Change at
Mid-Point from Previous Guidance

Consolidated revenue

$800 - $830 million

$840 - $860 million

4%

Adjusted EBITDA

$188 - $203 million

$197 - $211 million

4%

Adjusted EBITDA margin

23.5% - 24.5%

23.5% - 24.5%

unchanged

Interest expense

$16 - $18 million

$16 - $17 million

-3%

Effective tax rate

22% - 24%

22% - 24%

unchanged

Depreciation

$22 - $23 million

$21 - $22 million

-4%

Amortization

$32 - $33 million

$32 - $33 million

unchanged

Capital expenditures % total revenue

~4% of sales

~3% of sales

-100 bps

Non-GAAP Cash EPS

$3.60 -$3.80

$3.75 -$4.10

6%

Webcast

The Company will host a conference call and webcast today 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 Monday, November 15, 2021. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13723737. 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, 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

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 7

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) conditions in the capital markets, including the interest rate environment and the availability of capital; (ii) our failure to realize the benefits expected from the Balboa acquisition, our failure to promptly and effectively integrate the Balboa acquisition and the ability of Helios to retain and hire key personnel, and maintain relationships with suppliers (iii) 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; (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; and (v) 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 2, 2021.

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 margin. 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 2021 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.

 

For more information, contact:
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 

Financial Tables Follow:

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 8

HELIOS TECHNOLOGIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

 

Three Months Ended

 

 

Nine Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

 

% Change

 

 

October 2,
2021

 

 

September 26,
2020

 

 

% Change

 

Net sales

$

223,241

 

 

$

122,645

 

 

 

82

%

 

$

651,499

 

 

$

371,422

 

 

 

75

%

Cost of sales

 

142,299

 

 

 

75,702

 

 

 

88

%

 

 

413,036

 

 

 

227,910

 

 

 

81

%

Gross profit

 

80,942

 

 

 

46,943

 

 

 

72

%

 

 

238,463

 

 

 

143,512

 

 

 

66

%

Gross margin

 

36.2

%

 

 

38.3

%

 

 

 

 

 

36.6

%

 

 

38.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, engineering and administrative expenses

 

32,786

 

 

 

24,042

 

 

 

36

%

 

 

95,757

 

 

 

73,306

 

 

 

31

%

Amortization of intangible assets

 

7,407

 

 

 

4,558

 

 

 

63

%

 

 

25,285

 

 

 

13,323

 

 

 

90

%

Goodwill impairment

 

-

 

 

 

-

 

 

 NM

 

 

 

-

 

 

 

31,871

 

 

 NM

 

Operating income

 

40,749

 

 

 

18,343

 

 

 

122

%

 

 

117,421

 

 

 

25,012

 

 

 

370

%

Operating margin

 

18.2

%

 

 

14.9

%

 

 

 

 

 

18.0

%

 

 

6.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

3,813

 

 

 

2,730

 

 

 

40

%

 

 

12,965

 

 

 

8,572

 

 

 

51

%

Foreign currency transaction gain (loss), net

 

304

 

 

 

(727

)

 

 

(142

)%

 

 

1,271

 

 

 

(319

)

 

 

(498

)%

Other non-operating income, net

 

(616

)

 

 

(22

)

 

 NM

 

 

 

(727

)

 

 

(132

)

 

 

451

%

Income before income taxes

 

37,248

 

 

 

16,362

 

 

 

128

%

 

 

103,912

 

 

 

16,891

 

 

 NM

 

Income tax provision

 

9,488

 

 

 

3,380

 

 

 

181

%

 

 

22,870

 

 

 

8,224

 

 

 

178

%

Net income

$

27,760

 

 

$

12,982

 

 

 

114

%

 

$

81,042

 

 

$

8,667

 

 

 NM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net income per common share

$

0.86

 

 

$

0.40

 

 

 

115

%

 

$

2.51

 

 

$

0.27

 

 

 NM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted weighted average shares outstanding

 

32,385

 

 

 

32,095

 

 

 

 

 

 

32,272

 

 

 

32,079

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

$

0.09

 

 

$

0.09

 

 

 

 

 

$

0.27

 

 

$

0.27

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NM = Not meaningful

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 9

HELIOS TECHNOLOGIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

 

October 2,
2021

 

 

January 2,
2021

 

Assets

(Unaudited)

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

$

47,687

 

 

$

25,216

 

Restricted cash

 

41

 

 

 

41

 

Accounts receivable, net of allowance for

 

 

 

 

 

  credit losses of $1,333 and $1,493

 

136,812

 

 

 

97,623

 

Inventories, net

 

148,186

 

 

 

110,372

 

Income taxes receivable

 

3,892

 

 

 

1,103

 

Other current assets

 

20,130

 

 

 

19,664

 

Total current assets

 

356,748

 

 

 

254,019

 

Property, plant and equipment, net

 

165,778

 

 

 

163,177

 

Deferred income taxes

 

3,537

 

 

 

6,645

 

Goodwill

 

463,034

 

 

 

443,533

 

Other intangible assets, net

 

416,913

 

 

 

419,375

 

Other assets

 

11,982

 

 

 

10,230

 

Total assets

$

1,417,992

 

 

$

1,296,979

 

Liabilities and shareholders’ equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

$

73,927

 

 

$

59,477

 

Accrued compensation and benefits

 

26,370

 

 

 

22,985

 

Other accrued expenses and current liabilities

 

28,586

 

 

 

24,941

 

Current portion of long-term non-revolving debt, net

 

15,368

 

 

 

16,229

 

Dividends payable

 

2,916

 

 

 

2,891

 

Income taxes payable

 

10,733

 

 

 

1,489

 

Total current liabilities

 

157,900

 

 

 

128,012

 

Revolving line of credit

 

276,326

 

 

 

255,909

 

Long-term non-revolving debt, net

 

178,534

 

 

 

189,932

 

Deferred income taxes

 

78,026

 

 

 

78,864

 

Other noncurrent liabilities

 

38,760

 

 

 

36,472

 

Total liabilities

 

729,546

 

 

 

689,189

 

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,

 

 

 

 

 

   32,400 and 32,121 issued and outstanding

 

32

 

 

 

32

 

Capital in excess of par value

 

391,461

 

 

 

371,778

 

Retained earnings

 

342,643

 

 

 

270,320

 

Accumulated other comprehensive loss

 

(45,690

)

 

 

(34,340

)

Total shareholders’ equity

 

688,446

 

 

 

607,790

 

Total liabilities and shareholders’ equity

$

1,417,992

 

 

$

1,296,979

 

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 10

HELIOS TECHNOLOGIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

Nine Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

Cash flows from operating activities:

 

 

 

 

 

Net income

$

81,042

 

 

$

8,667

 

Adjustments to reconcile net income to

 

 

 

 

 

net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

41,131

 

 

 

25,805

 

Goodwill Impairment

 

-

 

 

 

31,871

 

Stock-based compensation expense

 

6,233

 

 

 

3,830

 

Amortization of debt issuance costs

 

374

 

 

 

537

 

Provision (benefit) for deferred income taxes

 

2,230

 

 

 

(2,937

)

Forward contract (gains) / losses, net

 

(3,401

)

 

 

2,513

 

Other, net

 

(135

)

 

 

1,287

 

(Increase) decrease in operating assets:

 

 

 

 

 

Accounts receivable

 

(36,634

)

 

 

(4,685

)

Inventories

 

(35,759

)

 

 

7,776

 

Income taxes receivable

 

(1,893

)

 

 

(2,874

)

Other current assets

 

(288

)

 

 

(1,382

)

Other assets

 

3,989

 

 

 

2,613

 

Increase (decrease) in operating liabilities:

 

 

 

 

 

Accounts payable

 

11,945

 

 

 

1,387

 

Accrued expenses and other liabilities

 

8,079

 

 

 

955

 

Income taxes payable

 

9,599

 

 

 

3,548

 

Other noncurrent liabilities

 

(4,527

)

 

 

(1,884

)

Net cash provided by operating activities

 

81,985

 

 

 

77,027

 

Cash flows from investing activities:

 

 

 

 

 

Acquisition of a business, net of cash acquired

 

(48,481

)

 

 

-

 

Amounts paid for net assets acquired

 

(2,400

)

 

 

-

 

Capital expenditures

 

(17,054

)

 

 

(7,155

)

Proceeds from dispositions of equipment

 

82

 

 

 

103

 

Cash settlement of forward contracts

 

1,433

 

 

 

(1,742

)

Software development costs

 

(1,785

)

 

 

(227

)

Net cash used in investing activities

 

(68,205

)

 

 

(9,021

)

Cash flows from financing activities:

 

 

 

 

 

Borrowings on revolving credit facilities

 

71,198

 

 

 

11,000

 

Repayment of borrowings on revolving credit facilities

 

(44,500

)

 

 

(55,609

)

Borrowings on long-term non-revolving debt

 

-

 

 

 

5,812

 

Repayment of borrowings on long-term non-revolving debt

 

(12,178

)

 

 

(5,905

)

Proceeds from stock issued

 

1,353

 

 

 

1,027

 

Dividends to shareholders

 

(8,694

)

 

 

(8,660

)

Other financing activities

 

(2,851

)

 

 

(1,937

)

Net cash provided by (used in) financing activities

 

4,328

 

 

 

(54,272

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

4,363

 

 

 

(3,414

)

Net increase in cash, cash equivalents and restricted cash

 

22,471

 

 

 

10,320

 

Cash, cash equivalents and restricted cash, beginning of period

 

25,257

 

 

 

22,162

 

Cash, cash equivalents and restricted cash, end of period

$

47,728

 

 

$

32,482

 

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 11

HELIOS TECHNOLOGIES

SEGMENT DATA

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Nine Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

 

October 2,
2021

 

 

September 26,
2020

 

Sales:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

133,404

 

 

$

98,206

 

 

$

385,549

 

 

$

304,113

 

Electronics

 

89,837

 

 

 

24,439

 

 

 

265,950

 

 

 

67,309

 

Consolidated

$

223,241

 

 

$

122,645

 

 

$

651,499

 

 

$

371,422

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit and margin:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

50,223

 

 

$

35,547

 

 

$

146,548

 

 

$

112,695

 

 

 

37.6

%

 

 

36.1

%

 

 

38.0

%

 

 

37.1

%

Electronics

 

31,277

 

 

 

11,396

 

 

 

92,473

 

 

 

30,817

 

 

 

34.9

%

 

 

46.8

%

 

 

34.8

%

 

 

45.7

%

Corporate and other

 

(558

)

 

 

-

 

 

 

(558

)

 

 

-

 

Consolidated

$

80,942

 

 

$

46,943

 

 

$

238,463

 

 

$

143,512

 

 

 

36.2

%

 

 

38.3

%

 

 

36.6

%

 

 

38.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) and margin:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

31,799

 

 

$

18,942

 

 

$

92,200

 

 

$

62,413

 

 

 

23.8

%

 

 

19.2

%

 

 

23.9

%

 

 

20.5

%

Electronics

 

18,445

 

 

 

4,683

 

 

 

56,324

 

 

 

10,400

 

 

 

20.5

%

 

 

19.2

%

 

 

21.2

%

 

 

15.5

%

Corporate and other

 

(9,495

)

 

 

(5,282

)

 

 

(31,103

)

 

 

(47,801

)

Consolidated

$

40,749

 

 

$

18,343

 

 

$

117,421

 

 

$

25,012

 

 

 

18.2

%

 

 

14.9

%

 

 

18.0

%

 

 

6.7

%

ORGANIC AND ACQUIRED REVENUE

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Full Year Ended

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

March 28,

 

 

June 27,

 

 

September 26,

 

 

January 2,

 

 

January 2,

 

 

April 3,

 

 

July 3,

 

 

October 2,

 

 

October 2,

 

 

2020

 

 

2020

 

 

2020

 

 

2021

 

 

2021

 

 

2021

 

 

2021

 

 

2021

 

 

2021

 

Hydraulics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

103,818

 

 

$

102,089

 

 

$

98,206

 

 

$

103,079

 

 

$

407,192

 

 

$

119,106

 

 

$

133,039

 

 

$

128,672

 

 

$

380,817

 

 Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,732

 

 

 

4,732

 

Total

$

103,818

 

 

$

102,089

 

 

$

98,206

 

 

$

103,079

 

 

$

407,192

 

 

$

119,106

 

 

$

133,039

 

 

$

133,404

 

 

$

385,549

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

25,665

 

 

$

17,205

 

 

$

24,439

 

 

$

22,481

 

 

$

89,790

 

 

$

29,459

 

 

$

30,191

 

 

$

30,808

 

 

$

90,459

 

Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

26,058

 

 

 

26,058

 

 

 

56,279

 

 

 

60,183

 

 

 

59,029

 

 

 

175,491

 

Total

$

25,665

 

 

$

17,205

 

 

$

24,439

 

 

$

48,539

 

 

$

115,848

 

 

$

85,738

 

 

$

90,374

 

 

$

89,837

 

 

$

265,950

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

129,483

 

 

$

119,294

 

 

$

122,645

 

 

$

125,560

 

 

$

496,982

 

 

$

148,565

 

 

$

163,230

 

 

$

159,480

 

 

$

471,276

 

Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

26,058

 

 

 

26,058

 

 

 

56,279

 

 

 

60,183

 

 

 

63,761

 

 

 

180,223

 

Total

$

129,483

 

 

$

119,294

 

 

$

122,645

 

 

$

151,618

 

 

$

523,040

 

 

$

204,844

 

 

$

223,413

 

 

$

223,241

 

 

$

651,499

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 12

HELIOS TECHNOLOGIES

ADDITIONAL INFORMATION

(Unaudited)

2021 Sales by Geographic Region and Segment

 

 

 

 

 

 

 

 

 

($ in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

% Change y/y

Q2

 

% Change y/y

Q3

 

% Change y/y

YTD 2021

 

% Change y/y

 

 

 

Americas:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

34.3

 

(8%)

$

41.7

 

22%

$

45.2

 

63%

$

121.2

 

22%

 

 

 

Electronics

 

65.0

 

201%

 

64.1

 

378%

 

64.2

 

200%

 

193.3

 

243%

 

 

 

Consol. Americas

 

99.3

 

69%

 

105.8

 

122%

 

109.4

 

123%

 

314.5

 

102%

 

 

 

% of total

 

48

%

 

 

47

%

 

 

49

%

 

 

48

%

 

 

 

 

EMEA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

43.3

 

29%

$

46.6

 

49%

$

44.8

 

40%

$

134.7

 

39%

 

 

 

Electronics

 

9.3

 

272%

 

11.0

 

479%

 

11.1

 

640%

 

31.5

 

434%

 

 

 

Consol. EMEA

 

52.6

 

46%

 

57.6

 

74%

 

55.9

 

66%

 

166.2

 

62%

 

 

 

% of total

 

26

%

 

 

26

%

 

 

25

%

 

 

26

%

 

 

 

 

APAC:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

41.5

 

26%

$

44.7

 

22%

$

43.4

 

13%

$

129.6

 

20%

 

 

 

Electronics

 

11.4

 

613%

 

15.3

 

705%

 

14.5

 

867%

 

41.2

 

724%

 

 

 

Consol. APAC

 

52.9

 

53%

 

60.0

 

55%

 

57.9

 

45%

 

170.8

 

51%

 

 

 

% of total

 

26

%

 

 

27

%

 

 

26

%

 

 

26

%

 

 

 

 

Total

$

204.8

 

58%

$

223.4

 

87%

$

223.2

 

82%

$

651.5

 

75%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020 Sales by Geographic Region and Segment

 

 

 

 

 

 

 

 

 

($ in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1

 

% Change y/y

Q2

 

% Change y/y

Q3

 

% Change y/y

Q4

 

% Change y/y

YTD 2020

 

% Change y/y

Americas:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

37.3

 

(10%)

$

34.2

 

(17%)

$

27.7

 

(36%)

$

31.3

 

(14%)

$

130.5

 

(20%)

Electronics

 

21.6

 

(17%)

 

13.4

 

(50%)

 

21.4

 

(11%)

 

37.5

 

92%

 

93.9

 

(2%)

Consol. Americas

 

58.9

 

(13%)

 

47.6

 

(30%)

 

49.1

 

(27%)

 

68.8

 

24%

 

224.4

 

(13%)

% of total

 

45

%

 

 

40

%

 

 

40

%

 

 

45

%

 

 

43

%

 

EMEA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

33.5

 

(20%)

$

31.2

 

(15%)

$

32.1

 

1%

$

34.4

 

11%

$

131.2

 

(7%)

Electronics

 

2.5

 

0%

 

1.9

 

6%

 

1.5

 

(29%)

 

4.9

 

145%

 

10.8

 

29%

Consol. EMEA

 

36.0

 

(19%)

 

33.1

 

(14%)

 

33.6

 

(1%)

 

39.3

 

19%

 

142.0

 

(5%)

% of total

 

28

%

 

 

28

%

 

 

27

%

 

 

26

%

 

 

27

%

 

APAC:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

33.0

 

(0%)

$

36.7

 

3%

$

38.4

 

10%

$

37.4

 

6%

$

145.5

 

5%

Electronics

 

1.6

 

(11%)

 

1.9

 

12%

 

1.5

 

(17%)

 

6.1

 

221%

 

11.1

 

54%

Consol. APAC

 

34.6

 

(1%)

 

38.6

 

3%

 

39.9

 

9%

 

43.5

 

17%

 

156.6

 

7%

% of total

 

27

%

 

 

32

%

 

 

33

%

 

 

29

%

 

 

30

%

 

Total

$

129.5

 

(12%)

$

119.3

 

(17%)

$

122.6

 

(11%)

$

151.6

 

20%

$

523.0

 

(6%)

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 13

HELIOS TECHNOLOGIES

Non-GAAP Adjusted Operating Income RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Nine Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

 

October 2,
2021

 

 

September 26,
2020

 

GAAP operating income

$

40,749

 

 

$

18,343

 

 

$

117,421

 

 

$

25,012

 

Acquisition-related amortization of intangible assets

 

7,407

 

 

 

4,558

 

 

 

25,285

 

 

 

13,323

 

Acquisition and financing-related expenses

 

654

 

 

 

101

 

 

 

2,901

 

 

 

176

 

Restructuring charges

 

55

 

 

 

64

 

 

 

472

 

 

 

361

 

CEO and officer transition costs

 

-

 

 

 

622

 

 

 

569

 

 

 

2,431

 

Goodwill impairment

 

-

 

 

 

-

 

 

 

-

 

 

 

31,871

 

Inventory step-up amortization

 

558

 

 

 

-

 

 

 

558

 

 

 

-

 

Acquisition integration costs

 

845

 

 

 

-

 

 

 

1,729

 

 

 

-

 

Other

 

(99

)

 

 

-

 

 

 

(99

)

 

 

-

 

Non-GAAP adjusted operating income

$

50,169

 

 

$

23,688

 

 

$

148,836

 

 

$

73,174

 

GAAP operating margin

 

18.2

%

 

 

14.9

%

 

 

18.0

%

 

 

6.7

%

Non-GAAP adjusted operating margin

 

22.5

%

 

 

19.3

%

 

 

22.8

%

 

 

19.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Nine Months Ended

 

 

Twelve Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

 

October 2,
2021

 

 

September 26,
2020

 

 

October 2,
2021

 

Net income

$

27,760

 

 

$

12,982

 

 

$

81,042

 

 

$

8,667

 

 

$

86,592

 

Interest expense, net

 

3,813

 

 

 

2,730

 

 

 

12,965

 

 

 

8,572

 

 

 

17,678

 

Income tax provision

 

9,488

 

 

 

3,380

 

 

 

22,870

 

 

 

8,224

 

 

 

24,475

 

Depreciation and amortization

 

12,989

 

 

 

8,784

 

 

 

41,131

 

 

 

25,805

 

 

 

55,021

 

EBITDA

 

54,050

 

 

 

27,876

 

 

 

158,008

 

 

 

51,268

 

 

 

183,766

 

Acquisition and financing-related expenses

 

654

 

 

 

101

 

 

 

2,901

 

 

 

176

 

 

 

9,989

 

Restructuring charges

 

55

 

 

 

64

 

 

 

472

 

 

 

361

 

 

 

473

 

CEO and officer transition costs

 

-

 

 

 

622

 

 

 

569

 

 

 

2,431

 

 

 

730

 

Goodwill impairment

 

-

 

 

 

-

 

 

 

-

 

 

 

31,871

 

 

 

-

 

Inventory step-up amortization

 

558

 

 

 

-

 

 

 

558

 

 

 

-

 

 

 

2,432

 

Acquisition integration costs

 

845

 

 

 

-

 

 

 

1,729

 

 

 

-

 

 

 

1,985

 

Other

 

(216

)

 

 

(13

)

 

 

481

 

 

 

(47

)

 

 

482

 

Adjusted EBITDA

$

55,946

 

 

$

28,650

 

 

$

164,718

 

 

$

86,060

 

 

$

199,857

 

Adjusted EBITDA margin

 

25.1

%

 

 

23.4

%

 

 

25.3

%

 

 

23.2

%

 

 

24.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balboa Water Group & NEM pre-acquisition adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

 

7,502

 

TTM Pro forma adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

 

$

207,359

 

 

 

 

 

Helios Technologies’ Effective Execution of Augmented Strategy Drives 82% Sales Growth and Strong Cash Generation in Third Quarter 2021

November 8, 2021

Page 14

HELIOS TECHNOLOGIES

Non-GAAP Cash Net Income RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Nine Months Ended

 

 

October 2,
2021

 

 

September 26,
2020

 

 

October 2,
2021

 

 

September 26,
2020

 

Net income

$

27,760

 

 

$

12,982

 

 

$

81,042

 

 

$

8,667

 

Amortization of intangible assets

 

7,487

 

 

 

4,558

 

 

 

25,431

 

 

 

13,323

 

Acquisition and financing-related expenses

 

654

 

 

 

101

 

 

 

2,901

 

 

 

176

 

Restructuring charges

 

55

 

 

 

64

 

 

 

472

 

 

 

361

 

CEO and officer transition costs

 

-

 

 

 

622

 

 

 

569

 

 

 

2,431

 

Goodwill impairment

 

-

 

 

 

-

 

 

 

-

 

 

 

31,871

 

Inventory Amortization Step-up

 

558

 

 

 

-

 

 

 

558

 

 

 

-

 

Acquisition integration costs

 

845

 

 

 

-

 

 

 

1,729

 

 

 

-

 

Other

 

(216

)

 

 

(13

)

 

 

481

 

 

 

(47

)

Tax effect of above

 

(2,347

)

 

 

(1,333

)

 

 

(8,035

)

 

 

(4,061

)

Non-GAAP cash net income

$

34,796

 

 

$

16,981

 

 

$

105,148

 

 

$

52,721

 

Non-GAAP cash net income per diluted share

$

1.07

 

 

$

0.53

 

 

$

3.26

 

 

$

1.64

 

Net Debt-to-Adjusted EBITDA RECONCILIATION

(In thousands)

(Unaudited)

 

 

As of

 

 

 

October 2,
2021

 

Current portion of long-term non-revolving debt, net

 

$

15,368

 

Revolving lines of credit

 

 

277,347

 

Long-term non-revolving debt, net

 

 

178,534

 

Total debt

 

 

471,249

 

Less: Cash and cash equivalents

 

 

47,687

 

Net debt

 

$

423,562

 

 

 

 

 

TTM Pro forma adjusted EBITDA*

 

$

207,359

 

Ratio of net debt to TTM pro forma adjusted EBITDA

 

 

2.04

 

*On a pro-forma basis for Balboa Water Group and NEM

 

 

 

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 2021 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. When planning, forecasting and analyzing future periods, the Company does so primarily on a non-GAAP basis without preparing a GAAP analysis.