Exhibit 99.1

img252001787_0.jpg 

NEWS

RELEASE

 

FOR IMMEDIATE RELEASE

Helios Technologies Outperforms on Augmented Strategy to Deliver
44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

•
Strong organic sales growth of 26% in the quarter and 27% for the year driven by innovation and responsiveness to meet strong demand and capture greater market share
•
Fundamental strength in operational strategy drives conversion to earnings; Fourth quarter net income grew to $23.6 million, up nearly 4x over the prior-year period
•
Achieved diluted EPS of $0.72 in the quarter; Diluted Non-GAAP Cash EPS of $1.01 up 68%
•
Full year adjusted EBITDA[1]margin expanded 140 basis points to 24.6%
•
Generated $113.2 million of cash from operations and $86.4 million of free cash flow in 2021; further reduced net debt to adjusted EBITDA leverage ratio to 1.89x[2]
•
Providing initial guidance for 2022 (organic only) with revenue expected to be $930 million to $950 million, approximately 8% growth at the midpoint of range; on path to achieve strategic goal of $1 billion in revenue by 2023


SARASOTA, FL, February 28, 2022 — 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 fourth quarter and year ended January 1, 2022. Results include the acquisitions of BWG Holdings I Corp. (known as “Balboa Water Group” or “Balboa acquisition”) on November 6, 2020, 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, “Our consistent exceptional performance is the direct result of the augmented strategy that we established and the excellent execution by our management team as well as the contributions of all of our colleagues around the world. Every day they are working to meet or exceed our customers’ requirements, advance innovative technology solutions, and exercise robust agility to address the challenges presented with the global macro economy. The depth and breadth of our innovation is validated by our strong organic growth as we introduce breakthrough technologies and capture greater market share. Our operating strategy is enabling our ability to remain highly responsive to our customers with lead times that well outpace the competition, even while operating conditions are less than ideal given supply shortages and material inflation. We are executing on our manufacturing roadmap to balance “make vs. buy” decisions and investing where needed to ensure we have capacity to meet the demand.”

He concluded, “Our augmented strategy is delivering on accelerated growth and our goal of $1 billion in revenue by 2023 is in our line of sight. We have tremendous potential as an organization, and I am very optimistic that it will be further unleashed when we move beyond these uniquely challenging times.”
 

[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 NEM and Joyonway

 

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

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 2

Fourth Quarter 2021 Consolidated Results

($ in millions, except per share data)

Q4 2021

 

 

Q4 2020

 

 

Change

 

 

% Change

 

Net sales

$

217.7

 

 

$

151.6

 

 

$

66.1

 

 

 

44

%

Gross profit

$

74.3

 

 

$

52.7

 

 

$

21.6

 

 

 

41

%

Gross margin

 

34.2

%

 

 

34.8

%

 

 

(60

)

bps

 

 

Operating income

$

31.9

 

 

$

10.4

 

 

$

21.5

 

 

 

207

%

Operating margin

 

14.6

%

 

 

6.9

%

 

 

770

 

bps

 

 

Non-GAAP adjusted operating margin

 

19.8

%

 

 

18.8

%

 

 

100

 

bps

 

 

Net income

$

23.6

 

 

$

5.6

 

 

$

18.0

 

 

 

321

%

Diluted EPS

$

0.72

 

 

$

0.17

 

 

$

0.55

 

 

 

324

%

Non-GAAP cash net income

$

32.9

 

 

$

19.2

 

 

$

13.7

 

 

 

71

%

Diluted Non-GAAP cash EPS

$

1.01

 

 

$

0.60

 

 

$

0.41

 

 

 

68

%

Adjusted EBITDA

$

49.3

 

 

$

35.1

 

 

$

14.2

 

 

 

40

%

Adjusted EBITDA margin

 

22.7

%

 

 

23.2

%

 

 

(50

)

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, and responsive manufacturing processes to deliver products and solutions to customers in a timely manner against supply chain constraints. Results included $26.4 million in sales from acquisitions. (See the table in this release that provides acquired revenue by segment by quarter).In addition, the Company experienced significant organic sales growth of $39.7 million, or 26%, 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: $1.5 million unfavorable.

Profits and margins

•
Gross profit and margin drivers: gross profit benefitted from increased volume during the quarter while gross margin declined by 60 basis points compared with the prior-year period, as improved leverage of our fixed cost base on the higher sales was offset by increases in logistics and raw material costs and reduced manufacturing labor efficiencies. 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 610 basis points to 16.0% compared with the 2020 fourth quarter, reflecting both the benefit of fixed cost leverage on higher sales and continued cost management initiatives.
•
Amortization of intangible assets: $7.5 million down from $8.8 million in the prior year reflecting timing related to the Company’s acquisitions.

Non-operating items

•
Net interest expense: $3.9 million in the quarter, down $0.8 million compared with the prior-year period due to lower debt balances.

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 3

•
Effective tax rate: 13.6% compared with 22.4% in the prior-year period due to positive impacts from the release of reserves related to previously disclosed tax controversies regarding transfer pricing matters in the US, UK, and Germany.

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

•
GAAP net income and diluted earnings per share: $23.6 million and $0.72 per share.
•
Diluted Non-GAAP cash earnings per share: $1.01 compared with $0.60 last year due to higher sales, operational efficiencies, and strong outperformance from the Balboa acquisition.
•
Adjusted EBITDA margin: declined 50 basis points to 22.7% compared with the prior-year period as higher volume was offset by material inflation and operational inefficiencies related to supply chain challenges.

2021 Consolidated Results

($ in millions, except per share data)

2021

 

 

2020

 

 

Change

 

 

% Change

 

Net sales

$

869.2

 

 

$

523.0

 

 

$

346.2

 

 

 

66

%

Gross profit

$

312.8

 

 

$

196.2

 

 

$

116.6

 

 

 

59

%

Gross margin

 

36.0

%

 

 

37.5

%

 

 

(150

)

bps

 

 

Operating income

$

149.3

 

 

$

35.4

 

 

$

113.9

 

 

 

322

%

Operating margin

 

17.2

%

 

 

6.8

%

 

 

1040

 

bps

 

 

Non-GAAP adjusted operating margin

 

22.1

%

 

 

19.5

%

 

 

260

 

bps

 

 

Net income

$

104.6

 

 

$

14.2

 

 

$

90.4

 

 

 

637

%

Diluted EPS

$

3.22

 

 

$

0.44

 

 

$

2.78

 

 

 

632

%

Non-GAAP cash net income

$

138.1

 

 

$

71.9

 

 

$

66.2

 

 

 

92

%

Diluted Non-GAAP cash EPS

$

4.25

 

 

$

2.24

 

 

$

2.01

 

 

 

90

%

Adjusted EBITDA

$

214.1

 

 

$

121.2

 

 

$

92.9

 

 

 

77

%

Adjusted EBITDA margin

 

24.6

%

 

 

23.2

%

 

 

140

 

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 growth reflected strong demand across all regions and markets, in particular agriculture, construction equipment, recreation, and health & wellness. Results included $206.6 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 strong organic growth of $139.5 million, or 27%, compared with 2020.
•
Foreign currency translation adjustment on sales: $12.4 million favorable.

Profits and margins

•
Gross profit and margin drivers: gross profit benefitted from increased volume during the period. Gross margin declined by 150 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.

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 4

•
Selling, engineering and administrative (“SEA”) expenses: 15.0% as a percentage of sales, improved
540 basis points compared with the prior-year period, reflecting both the lower SEA expenses relative to sales for the Balboa acquisition, fixed cost leverage on higher sales, and continued cost containment initiatives.
•
Amortization of intangible assets: increased $10.7 million to $32.8 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: $3.6 million increase to $16.9 million compared with the prior-year period reflecting higher debt balances.
•
Effective tax rate: 20.3% compared with 17.6% 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 diluted earnings per share: $104.6 million and $3.22 per share.
•
Diluted Non-GAAP cash earnings per share: $4.25 compared with $2.24 in the prior-year period driven by strong demand, operational efficiencies and strong performance of the Balboa acquisition.
•
Adjusted EBITDA margin: 24.6%, up 140 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

 

 

 

 

 

 

 

 

 

Q4 2021

 

 

Q4 2020

 

 

Change

 

 

% Change

 

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

Americas

$

46.5

 

 

$

31.3

 

 

$

15.2

 

 

 

49

%

 

EMEA

 

45.3

 

 

 

34.4

 

 

 

10.9

 

 

 

32

%

 

APAC

 

39.1

 

 

 

37.4

 

 

 

1.7

 

 

 

5

%

 

Total Segment Sales

$

130.9

 

 

$

103.1

 

 

$

27.8

 

 

 

27

%

 

Gross Profit

$

46.8

 

 

$

37.6

 

 

$

9.2

 

 

 

24

%

 

Gross Margin

 

35.8

%

 

 

36.5

%

 

 

(70

)

bps

 

 

 

SEA Expenses

$

19.2

 

 

$

18.0

 

 

$

1.2

 

 

 

7

%

 

Operating Income

$

27.6

 

 

$

19.6

 

 

$

8.0

 

 

 

41

%

 

Operating Margin

 

21.1

%

 

 

19.0

%

 

 

210

 

bps

 

 

 

Fourth 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 $1.5 million unfavorable adjustment on sales.
•
Gross margin of 35.8% reflects improved leverage on higher volume offset by reduced production labor efficiencies related to COVID absenteeism and higher material and freight costs.

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 5

•
Operating margin of 21.1% improved 210 basis points, reflecting improved leverage of our fixed cost base and disciplined cost management efforts.

Electronics Segment Review

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

($ in millions)

 

 

 

 

 

 

 

 

 

 

Electronics

Three Months Ended

 

 

 

 

 

 

 

 

Q4 2021

 

 

Q4 2020

 

 

Change

 

 

% Change

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

Americas

$

64.5

 

 

$

37.5

 

 

$

27.0

 

 

 

72

%

EMEA

 

10.6

 

 

 

4.9

 

 

 

5.7

 

 

 

116

%

APAC

 

11.7

 

 

 

6.1

 

 

 

5.6

 

 

 

92

%

Total Segment Sales

$

86.8

 

 

$

48.5

 

 

$

38.3

 

 

 

79

%

Gross Profit

$

27.5

 

 

$

17.0

 

 

$

10.5

 

 

 

62

%

Gross Margin

 

31.7

%

 

 

35.0

%

 

 

(330

)

bps

 

 

SEA Expenses

$

12.1

 

 

$

8.0

 

 

$

4.1

 

 

 

51

%

Operating Income

$

15.4

 

 

$

9.0

 

 

$

6.4

 

 

 

71

%

Operating Margin

 

17.7

%

 

 

18.5

%

 

 

(80

)

bps

 

 

Fourth Quarter Electronics Segment Review

•
Higher sales included $20.7 million related to the acquisitions of Balboa and Joyonway. 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 17.7% reflects flow through of gross margin impacts offset by fixed cost leverage on higher sales.

Balance Sheet and Cash Flow Review

•
Total debt at year-end was $445.0 million compared with $462.4 million at January 2, 2021.
•
Cash and cash equivalents at January 1, 2022 were $28.5 million compared with $25.2 million at the end of 2020.
•
Inventory increased $55.3 million from the end of 2020 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 1.89x at the end of 2021 (pro-forma for NEM and Joyonway) compared with 3.0x (pro-forma for Balboa) 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 2021, the Company had $158.0 million available on its revolving lines of credit.
•
Net cash provided by operations was $113.2 million in 2021 compared with $108.6 million in the prior-year period.
•
Capital expenditures were $26.8 million for the full year of 2021. The Company expects to spend between 3% to 5% of sales in capital investments in 2022.

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 6

2022 Outlook

The following provides the Company’s 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, March 1st 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, March 8, 2022. To listen to the archived call, dial (412) 317-6671 and enter conference ID number 13725927. 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,”

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 7

“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; and (vi) 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, 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.

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 Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 8

HELIOS TECHNOLOGIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

For the Year Ended

 

 

January 1,
2022

 

 

January 2,
2021

 

 

% Change

 

 

January 1,
2022

 

 

January 2,
2021

 

 

% Change

 

Net sales

$

217,687

 

 

$

151,618

 

 

 

44

%

 

$

869,185

 

 

$

523,040

 

 

 

66

%

Cost of sales

 

143,343

 

 

 

98,902

 

 

 

45

%

 

 

556,380

 

 

 

326,812

 

 

 

70

%

Gross profit

 

74,344

 

 

 

52,716

 

 

 

41

%

 

 

312,805

 

 

 

196,228

 

 

 

59

%

Gross margin

 

34.2

%

 

 

34.8

%

 

 

 

 

 

36.0

%

 

 

37.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, engineering and administrative expenses

 

34,927

 

 

 

33,525

 

 

 

4

%

 

 

130,685

 

 

 

106,831

 

 

 

22

%

Amortization of intangible assets

 

7,527

 

 

 

8,791

 

 

 

(14

)%

 

 

32,811

 

 

 

22,114

 

 

 

48

%

Goodwill impairment

 

-

 

 

 

-

 

 

NM

 

 

 

-

 

 

 

31,871

 

 

NM

 

Operating income

 

31,890

 

 

 

10,400

 

 

 

207

%

 

 

149,309

 

 

 

35,412

 

 

 

322

%

Operating margin

 

14.6

%

 

 

6.9

%

 

 

 

 

 

17.2

%

 

 

6.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

3,907

 

 

 

4,714

 

 

 

(17

)%

 

 

16,871

 

 

 

13,286

 

 

 

27

%

Foreign currency transaction (gain) loss, net

 

(301

)

 

 

(1,237

)

 

 

(76

)%

 

 

970

 

 

 

(1,555

)

 

 

(162

)%

Other non-operating expense (income), net

 

1,016

 

 

 

(233

)

 

 

(536

)%

 

 

289

 

 

 

(366

)

 

 

(179

)%

Income before income taxes

 

27,268

 

 

 

7,156

 

 

 

281

%

 

 

131,179

 

 

 

24,047

 

 

 

446

%

Income tax provision

 

3,713

 

 

 

1,605

 

 

 

131

%

 

 

26,583

 

 

 

9,829

 

 

 

170

%

Net income

$

23,555

 

 

$

5,551

 

 

 

324

%

 

$

104,596

 

 

$

14,218

 

 

 

636

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

0.73

 

 

$

0.17

 

 

 

329

%

 

$

3.24

 

 

$

0.44

 

 

 

636

%

Diluted

$

0.72

 

 

$

0.17

 

 

 

324

%

 

$

3.22

 

 

$

0.44

 

 

 

632

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

32,403

 

 

 

32,113

 

 

 

 

 

 

32,304

 

 

 

32,088

 

 

 

 

Diluted

 

32,579

 

 

 

32,211

 

 

 

 

 

 

32,475

 

 

 

32,210

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

$

0.09

 

 

$

0.09

 

 

 

 

 

$

0.36

 

 

$

0.36

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NM = Not meaningful

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 9

HELIOS TECHNOLOGIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

 

January 1,
2022

 

 

January 2,
2021

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

$

28,540

 

 

$

25,216

 

Restricted cash

 

41

 

 

 

41

 

Accounts receivable, net of allowance for

 

 

 

 

 

  credit losses of $1,212 and $1,493

 

134,561

 

 

 

97,623

 

Inventories, net

 

165,629

 

 

 

110,372

 

Income taxes receivable

 

2,762

 

 

 

1,103

 

Other current assets

 

20,101

 

 

 

19,664

 

Total current assets

 

351,634

 

 

 

254,019

 

Property, plant and equipment, net

 

174,210

 

 

 

163,177

 

Deferred income taxes

 

2,934

 

 

 

6,645

 

Goodwill

 

459,936

 

 

 

443,533

 

Other intangible assets, net

 

412,759

 

 

 

419,375

 

Other assets

 

13,873

 

 

 

10,230

 

Total assets

$

1,415,346

 

 

$

1,296,979

 

Liabilities and shareholders’ equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

$

85,301

 

 

$

59,477

 

Accrued compensation and benefits

 

28,595

 

 

 

22,985

 

Other accrued expenses and current liabilities

 

28,254

 

 

 

24,941

 

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

 

18,125

 

 

 

16,229

 

Dividends payable

 

2,917

 

 

 

2,891

 

Income taxes payable

 

6,328

 

 

 

1,489

 

Total current liabilities

 

169,520

 

 

 

128,012

 

Revolving line of credit

 

242,312

 

 

 

255,909

 

Long-term non-revolving debt, net

 

183,897

 

 

 

189,932

 

Deferred income taxes

 

71,836

 

 

 

78,864

 

Other noncurrent liabilities

 

38,818

 

 

 

36,472

 

Total liabilities

 

706,383

 

 

 

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,

 

 

 

 

 

   32,407 and 32,121 issued and outstanding

 

32

 

 

 

32

 

Capital in excess of par value

 

394,641

 

 

 

371,778

 

Retained earnings

 

363,279

 

 

 

270,320

 

Accumulated other comprehensive loss

 

(48,989

)

 

 

(34,340

)

Total shareholders’ equity

 

708,963

 

 

 

607,790

 

Total liabilities and shareholders’ equity

$

1,415,346

 

 

$

1,296,979

 

 

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 10

HELIOS TECHNOLOGIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

 

For the Year Ended

 

 

January 1,
2022

 

 

January 2,
2021

 

Cash flows from operating activities:

 

 

 

 

 

Net income

$

104,596

 

 

$

14,218

 

Adjustments to reconcile net income to

 

 

 

 

 

net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

54,401

 

 

 

39,695

 

Goodwill Impairment

 

-

 

 

 

31,871

 

Stock-based compensation expense

 

8,880

 

 

 

5,781

 

Amortization of debt issuance costs

 

498

 

 

 

1,107

 

Benefit for deferred income taxes

 

(1,403

)

 

 

(3,631

)

Amortization of acquisition- related inventory step up

 

558

 

 

 

1,874

 

Forward contract (gains) / losses, net

 

(4,685

)

 

 

5,458

 

Other, net

 

55

 

 

 

1,006

 

(Increase) decrease in operating assets:

 

 

 

 

 

Accounts receivable

 

(32,352

)

 

 

727

 

Inventories

 

(52,549

)

 

 

570

 

Income taxes receivable

 

(688

)

 

 

1,731

 

Other current assets

 

729

 

 

 

(1,856

)

Other assets

 

5,332

 

 

 

4,030

 

Increase (decrease) in operating liabilities:

 

 

 

 

 

Accounts payable

 

23,792

 

 

 

10,569

 

Accrued expenses and other liabilities

 

8,087

 

 

 

3,806

 

Income taxes payable

 

5,686

 

 

 

(5,127

)

Other noncurrent liabilities

 

(7,735

)

 

 

(3,273

)

Net cash provided by operating activities

 

113,202

 

 

 

108,556

 

Cash flows from investing activities:

 

 

 

 

 

Acquisition of a business, net of cash acquired

 

(61,106

)

 

 

(217,029

)

Capital expenditures

 

(26,794

)

 

 

(14,580

)

Proceeds from dispositions of equipment

 

175

 

 

 

100

 

Cash settlement of forward contracts

 

2,356

 

 

 

(3,524

)

Software development costs

 

(2,499

)

 

 

(865

)

Amounts paid for net assets acquired

 

(2,400

)

 

 

-

 

Net cash used in investing activities

 

(90,268

)

 

 

(235,898

)

Cash flows from financing activities:

 

 

 

 

 

Borrowings on revolving credit facilities

 

81,189

 

 

 

117,565

 

Repayment of borrowings on revolving credit facilities

 

(86,823

)

 

 

(79,609

)

Borrowings on long-term non-revolving debt

 

12,026

 

 

 

119,727

 

Repayment of borrowings on long-term non-revolving debt

 

(16,244

)

 

 

(5,958

)

Proceeds from stock issued

 

1,822

 

 

 

1,344

 

Debt issuance costs

 

(11,610

)

 

 

(11,550

)

Dividends to shareholders

 

-

 

 

 

(1,714

)

Payment of contingent consideration liabilities

 

(328

)

 

 

(830

)

Other financing activities

 

(2,628

)

 

 

(1,234

)

Net cash (used in) provided by financing activities

 

(22,596

)

 

 

137,741

 

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

 

2,986

 

 

 

(7,304

)

Net increase in cash, cash equivalents and restricted cash

 

3,324

 

 

 

3,095

 

Cash, cash equivalents and restricted cash, beginning of period

 

25,257

 

 

 

22,162

 

Cash, cash equivalents and restricted cash, end of period

$

28,581

 

 

$

25,257

 

 

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 11

HELIOS TECHNOLOGIES

SEGMENT DATA

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

For the Year Ended

 

 

January 1,
2022

 

 

January 2,
2021

 

 

January 1,
2022

 

 

January 2,
2021

 

Sales:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

130,900

 

 

$

103,079

 

 

$

516,449

 

 

$

407,192

 

Electronics

 

86,787

 

 

 

48,539

 

 

 

352,736

 

 

 

115,848

 

Consolidated

$

217,687

 

 

$

151,618

 

 

$

869,185

 

 

$

523,040

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit and margin:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

46,819

 

 

$

37,617

 

 

$

193,366

 

 

$

150,312

 

 

 

35.8

%

 

 

36.5

%

 

 

37.5

%

 

 

36.9

%

Electronics

 

27,525

 

 

 

16,973

 

 

 

119,997

 

 

 

47,790

 

 

 

31.7

%

 

 

35.0

%

 

 

34.0

%

 

 

41.3

%

Corporate and other

 

-

 

 

 

(1,874

)

 

 

(558

)

 

 

(1,874

)

Consolidated

$

74,344

 

 

$

52,716

 

 

$

312,805

 

 

$

196,228

 

 

 

34.2

%

 

 

34.8

%

 

 

36.0

%

 

 

37.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) and margin:

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

27,627

 

 

$

19,584

 

 

$

119,824

 

 

$

81,996

 

 

 

21.1

%

 

 

19.0

%

 

 

23.2

%

 

 

20.1

%

Electronics

 

15,371

 

 

 

8,963

 

 

 

71,695

 

 

 

19,363

 

 

 

17.7

%

 

 

18.5

%

 

 

20.3

%

 

 

16.8

%

Corporate and other

 

(11,108

)

 

 

(18,147

)

 

 

(42,210

)

 

 

(65,947

)

Consolidated

$

31,890

 

 

$

10,400

 

 

$

149,309

 

 

$

35,412

 

 

 

14.6

%

 

 

6.9

%

 

 

17.2

%

 

 

6.8

%

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 12

ORGANIC AND ACQUIRED REVENUE

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

Full Year Ended

 

 

Three Months Ended

 

 

Full Year Ended

 

 

March 28,

 

 

June 27,

 

 

September 26,

 

 

January 2,

 

 

January 2,

 

 

April 3,

 

 

July 3,

 

 

October 2,

 

 

January 1,

 

 

January 1,

 

 

2020

 

 

2020

 

 

2020

 

 

2021

 

 

2021

 

 

2021

 

 

2021

 

 

2021

 

 

2022

 

 

2022

 

Hydraulics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

103,818

 

 

$

102,089

 

 

$

98,206

 

 

$

103,079

 

 

$

407,192

 

 

$

119,106

 

 

$

133,039

 

 

$

128,672

 

 

$

125,200

 

 

$

506,017

 

Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,732

 

 

 

5,700

 

 

 

10,432

 

Total

$

103,818

 

 

$

102,089

 

 

$

98,206

 

 

$

103,079

 

 

$

407,192

 

 

$

119,106

 

 

$

133,039

 

 

$

133,404

 

 

$

130,900

 

 

$

516,449

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electronics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

25,665

 

 

$

17,205

 

 

$

24,439

 

 

$

22,481

 

 

$

89,790

 

 

$

29,459

 

 

$

30,191

 

 

$

30,808

 

 

$

66,107

 

 

$

156,565

 

Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

26,058

 

 

 

26,058

 

 

 

56,279

 

 

 

60,183

 

 

 

59,029

 

 

 

20,680

 

 

 

196,171

 

Total

$

25,665

 

 

$

17,205

 

 

$

24,439

 

 

$

48,539

 

 

$

115,848

 

 

$

85,738

 

 

$

90,374

 

 

$

89,837

 

 

$

86,787

 

 

$

352,736

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Organic

$

129,483

 

 

$

119,294

 

 

$

122,645

 

 

$

125,560

 

 

$

496,982

 

 

$

148,565

 

 

$

163,230

 

 

$

159,480

 

 

$

191,307

 

 

$

662,582

 

Acquisition

 

-

 

 

 

-

 

 

 

-

 

 

 

26,058

 

 

 

26,058

 

 

 

56,279

 

 

 

60,183

 

 

 

63,761

 

 

 

26,380

 

 

 

206,603

 

Total

$

129,483

 

 

$

119,294

 

 

$

122,645

 

 

$

151,618

 

 

$

523,040

 

 

$

204,844

 

 

$

223,413

 

 

$

223,241

 

 

$

217,687

 

 

$

869,185

 

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 13

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

Q4

 

% Change y/y

YTD 2021

 

% Change y/y

Americas:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

34.3

 

(8%)

$

41.7

 

22%

$

45.2

 

63%

$

46.5

 

49%

$

167.7

 

29%

Electronics

 

65.0

 

201%

 

64.1

 

378%

 

64.2

 

200%

$

64.5

 

72%

 

257.8

 

175%

Consol. Americas

 

99.3

 

69%

 

105.8

 

122%

 

109.4

 

123%

 

111.0

 

61%

 

425.5

 

90%

% of total

 

48

%

 

 

47

%

 

 

49

%

 

 

51

%

 

 

49

%

 

EMEA:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

43.3

 

29%

$

46.6

 

49%

$

44.8

 

40%

$

45.3

 

32%

$

180.0

 

37%

Electronics

 

9.3

 

272%

 

11.0

 

479%

 

11.1

 

640%

$

10.6

 

116%

 

42.0

 

289%

Consol. EMEA

 

52.6

 

46%

 

57.6

 

74%

 

55.9

 

66%

 

55.9

 

42%

 

222.0

 

56%

% of total

 

26

%

 

 

26

%

 

 

25

%

 

 

26

%

 

 

26

%

 

APAC:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hydraulics

$

41.5

 

26%

$

44.7

 

22%

$

43.4

 

13%

$

39.1

 

5%

$

168.7

 

16%

Electronics

 

11.4

 

613%

 

15.3

 

705%

 

14.5

 

867%

$

11.7

 

92%

 

52.9

 

377%

Consol. APAC

 

52.9

 

53%

 

60.0

 

55%

 

57.9

 

45%

 

50.8

 

17%

 

221.7

 

42%

% of total

 

26

%

 

 

27

%

 

 

26

%

 

 

23

%

 

 

26

%

 

Total

$

204.8

 

58%

$

223.4

 

87%

$

223.2

 

82%

$

217.7

 

44%

$

869.2

 

66%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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 Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 14

HELIOS TECHNOLOGIES

Non-GAAP Adjusted Operating Income RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

For the Year Ended

 

 

January 1,
2022

 

 

January 2,
2021

 

 

January 1,
2022

 

 

January 2,
2021

 

GAAP operating income

$

31,890

 

 

$

10,400

 

 

$

149,309

 

 

$

35,412

 

Acquisition-related amortization of intangible assets

 

7,527

 

 

 

8,791

 

 

 

32,811

 

 

 

22,114

 

Acquisition and financing-related expenses

 

2,840

 

 

 

7,088

 

 

 

5,741

 

 

 

7,264

 

Restructuring charges

 

-

 

 

 

-

 

 

 

472

 

 

 

361

 

CEO and officer transition costs

 

(252

)

 

 

161

 

 

 

319

 

 

 

2,592

 

Goodwill impairment

 

-

 

 

 

-

 

 

 

-

 

 

 

31,871

 

Inventory step-up amortization

 

-

 

 

 

1,874

 

 

 

558

 

 

 

1,874

 

Acquisition integration costs

 

1,121

 

 

 

257

 

 

 

2,850

 

 

 

257

 

Other

 

-

 

 

 

-

 

 

 

(99

)

 

 

-

 

Non-GAAP adjusted operating income

$

43,126

 

 

$

28,571

 

 

$

191,961

 

 

$

101,745

 

GAAP operating margin

 

14.6

%

 

 

6.9

%

 

 

17.2

%

 

 

6.8

%

Non-GAAP adjusted operating margin

 

19.8

%

 

 

18.8

%

 

 

22.1

%

 

 

19.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

For the Year Ended

 

 

 

January 1,
2022

 

 

 

January 2,
2021

 

 

January 1,
2022

 

 

January 2,
2021

 

 

Net income

$

23,555

 

 

 

$

5,551

 

 

$

104,596

 

 

$

14,218

 

 

Interest expense, net

 

3,907

 

 

 

 

4,714

 

 

 

16,871

 

 

 

13,286

 

 

Income tax provision

 

3,713

 

 

 

 

1,605

 

 

 

26,583

 

 

 

9,829

 

 

Depreciation and amortization

 

13,270

 

 

 

 

13,890

 

 

 

54,401

 

 

 

39,695

 

 

EBITDA

 

44,445

 

 

 

 

25,760

 

 

 

202,451

 

 

 

77,028

 

 

Acquisition and financing-related expenses

 

2,840

 

 

 

 

7,088

 

 

 

5,741

 

 

 

7,264

 

 

Restructuring charges

 

-

 

 

 

 

-

 

 

 

472

 

 

 

361

 

 

CEO and officer transition costs

 

(252

)

 

 

 

161

 

 

 

319

 

 

 

2,592

 

 

Goodwill impairment

 

-

 

 

 

 

-

 

 

 

-

 

 

 

31,871

 

 

Inventory step-up amortization

 

-

 

 

-

 

 

1,874

 

 

 

558

 

 

 

1,874

 

 

Acquisition integration costs

 

1,121

 

 

 

 

257

 

 

 

2,850

 

 

 

257

 

 

Change in fair value of contingent consideration

 

1,050

 

 

 

 

-

 

 

 

1,050

 

 

 

(47

)

 

Other

 

144

 

 

 

 

-

 

 

 

625

 

 

 

-

 

 

Adjusted EBITDA

$

49,348

 

 

 

$

35,140

 

 

$

214,066

 

 

$

121,200

 

 

Adjusted EBITDA margin

 

22.7

%

 

 

 

23.2

%

 

 

24.6

%

 

 

23.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-acquisition adjusted EBITDA, 2021 NEM and Joyonway, 2020 Balboa

 

 

 

 

 

 

 

 

6,335

 

 

 

22,589

 

 

TTM Pro forma adjusted EBITDA

 

 

 

 

 

 

 

$

220,401

 

 

$

143,789

 

 

 

 

 

 

Helios Technologies Outperforms on Augmented Strategy to Deliver 44% Revenue Growth and 324% EPS Growth in the Fourth Quarter 2021

February 28, 2022

Page 15

HELIOS TECHNOLOGIES

Non-GAAP Cash Net Income RECONCILIATION

(In thousands)

(Unaudited)

 

Three Months Ended

 

 

For the Year Ended

 

 

January 1,
2022

 

 

January 2,
2021

 

 

January 1,
2022

 

 

January 2,
2021

 

Net income

$

23,555

 

 

$

5,551

 

 

$

104,596

 

 

$

14,218

 

Amortization of intangible assets

 

7,611

 

 

 

8,791

 

 

 

33,042

 

 

 

22,114

 

Acquisition and financing-related expenses

 

2,840

 

 

 

7,088

 

 

 

5,741

 

 

 

7,264

 

Restructuring charges

 

-

 

 

 

-

 

 

 

472

 

 

 

361

 

CEO and officer transition costs

 

(252

)

 

 

161

 

 

 

319

 

 

 

2,592

 

Goodwill impairment

 

-

 

 

 

-

 

 

 

-

 

 

 

31,871

 

Inventory Amortization Step-up

 

-

 

 

 

1,874

 

 

 

558

 

 

 

1,874

 

Acquisition integration costs

 

1,121

 

 

 

257

 

 

 

2,850

 

 

 

257

 

Change in fair value of contingent consideration

 

1,050

 

 

 

-

 

 

 

1,050

 

 

 

(47

)

Other

 

144

 

 

 

-

 

 

 

625

 

 

 

-

 

Tax effect of above

 

(3,129

)

 

 

(4,543

)

 

 

(11,164

)

 

 

(8,604

)

Non-GAAP cash net income

$

32,940

 

 

$

19,179

 

 

$

138,089

 

 

$

71,900

 

Non-GAAP cash net income per diluted share

$

1.01

 

 

$

0.60

 

 

$

4.25

 

 

$

2.24

 

Net Debt-to-Adjusted EBITDA RECONCILIATION

(In thousands)

(Unaudited)

 

 

As of

 

 

 

January 1,
2022

 

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

 

$

18,125

 

Revolving lines of credit

 

 

243,023

 

Long-term non-revolving debt, net

 

 

183,897

 

Total debt

 

 

445,045

 

Less: Cash and cash equivalents

 

 

28,540

 

Net debt

 

$

416,505

 

TTM Pro forma adjusted EBITDA*

 

$

220,401

 

Ratio of net debt to TTM pro forma adjusted EBITDA

 

 

1.89

 

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