Hillman Reports Third Quarter 2024 Results
CINCINNATI, Nov. 05, 2024 (GLOBE NEWSWIRE) -- Hillman Solutions Corp. (NASDAQ:HLMN) (the "Company" or "Hillman"), a leading provider of hardware products and merchandising solutions, reported financial results for the thirteen and thirty-nine weeks ended September 28, 2024.
Third Quarter 2024 Highlights (Thirteen weeks ended September 28, 2024)
Net sales decreased (1.4)% to $393.3 million compared to $398.9 million in the prior year quarter
Net income totaled $7.4 million, or $0.04 per diluted share, compared to $5.1 million, or $0.03 per diluted share, in the prior year quarter
Adjusted diluted EPS1 was $0.16 per diluted share compared to $0.11 per diluted share in the prior year quarter
Adjusted EBITDA1 totaled $72.6 million compared to $66.8 million in the prior year quarter
Acquired Intex DIY, a leading supplier of wiping cloths, consumable rags and cleaning textiles
Subsequent to quarter end, Hillman won divisional 2024 Vendor Partner of the Year in Hardlines at Lowe's and won 2024 Partner of the Year in Hardware at Home Depot
Third Quarter YTD 2024 Highlights (Thirty-nine weeks ended September 28, 2024)
Net sales decreased (0.5)% to $1,123.0 million compared to $1,128.7 million in the prior year period
Net income totaled $18.5 million, or $0.09 per diluted share, compared to net income of $0.5 million, or $0.00 per diluted share, in the prior year period
Adjusted diluted EPS1 was $0.42 per diluted share compared to $0.30 per diluted share in the prior year period
Adjusted EBITDA1 totaled $193.2 million compared to $165.0 million in the prior year period
Net cash provided by operating activities was $140.2 million compared to $171.5 million in the prior year period
Free Cash Flow1 totaled $76.0 million compared to $119.3 million in the prior year period
Balance Sheet and Liquidity at September 28, 2024
Gross debt was $758.6 million, compared to $760.9 million on December 30, 2023, and $811.1 million on September 30, 2023
Net debt1 decreased to $698.7 million, compared to $722.4 million on December 30, 2023, and $771.8 million on September 30, 2023
Liquidity available totaled $324.6 million, consisting of $264.8 million of available borrowing under the revolving credit facility and $59.8 million of cash and equivalents
Net debt1 to trailing twelve month Adjusted EBITDA improved to 2.8x from 3.3x on December 30, 2023, and 3.7x on September 30, 2023
Management Commentary
"Our strong results for the third quarter were driven by efficient operations across the organization while taking great care of our customers," commented Doug Cahill, Chairman, President and CEO of Hillman. "Our 1,100 field sales and service folks continue to regularly manage the aisle for our customers, and our operations team has done a great job shipping our 114,000 SKUs to our customers on time and in full - demonstrated by our year-to-date fill rate of 95 percent."
"During the quarter we acquired Intex DIY, a leading supplier of cleaning rags, cloths, and textiles. This acquisition adds new products to our portfolio, and allows us to sell into new aisles and to new customers. We continue to seek bolt-on acquisitions like Intex DIY, that allow us to leverage our competitive moat to fuel long-term organic growth."
"Subsequent to the quarter end, we won 2024 vendor partner of the year awards at our top two customers, Lowe's and Home Depot. We are proud of this recognition and grateful for the hardworking Hillman team that made this happen. Taking care of our customers has always been the lifeblood of this company and has been the key driver our long-term success. As we look forward, the partnership and trust we have with our customers and our new business pipeline give us confidence that we are well positioned to grow our top and bottom line in 2025."
Full Year 2024 Guidance - Updated
Based on year-to-date performance and improved visibility on the remainder of the year, management is updating its guidance most recently provided on August 6, 2024 with Hillman's second quarter 2024 results.
Previous FY 2024 Guidance
Updated FY 2024 Guidance
Net Sales
$1.44 to $1.48 billion
$1.455 to $1.485 billion
Adjusted EBITDA1
$240 to $250 million
Approx. $250 million
Free Cash Flow1
$100 to $120 million
$100 to $115 million
Rocky Kraft, Hillman's chief financial officer commented: "We are increasing our top and bottom line guidance to reflect the acquisition of Intex, which closed in August of this year, and our strong bottom line results. We also lowered the top end of our free cash flow guide to better fall in line with our expectations."
1) Denotes Non-GAAP metric. For additional information, including our definitions, use of, and reconciliations of these metrics to the most directly comparable financial measures under GAAP, please see the reconciliations toward the end of the press release.
Third Quarter 2024 Results Presentation
Hillman plans to host a conference call and webcast presentation today, November 5, 2024, at 8:30 a.m. Eastern Time to discuss its results. Chairman, President, and Chief Executive Officer Doug Cahill; Chief Operating Officer Jon Michael Adinolfi, and Chief Financial Officer Rocky Kraft will host the results presentation.
Date: Tuesday, November 5, 2024
Time: 8:30 a.m. Eastern Time
Listen-Only Webcast: https://edge.media-server.com/mmc/p/fs2k9czt/
A webcast replay will be available approximately one hour after the conclusion of the call using the link above.
Hillman's quarterly presentation and Form 10-Q are expected to be filed with the SEC and posted to its Investor Relations website, https://ir.hillmangroup.com, prior to the webcast presentation.
About Hillman Solutions Corp.
Founded in 1964 and headquartered in Cincinnati, Ohio, Hillman Solutions Corp. ("Hillman") and its subsidiaries are leading North American providers of complete hardware solutions, delivered with outstanding customer service to over 46,000 locations. Hillman is celebrating 60 years of service this year, a significant milestone achieved by maintaining strong company values, an innovative culture, and delivering a "small business" experience with "big business" efficiency. Hillman designs innovative product and merchandising solutions for complex categories that deliver an outstanding customer experience to home improvement centers, mass merchants, national and regional hardware stores, pet supply stores, and OEM & industrial customers. For more information on Hillman, visit www.hillman.com.
Forward Looking Statements
All statements made in this press release that are consider to be forward-looking are made in good faith by the Company and are intended to qualify for the safe harbor from liability established by Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995. You should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "target", "goal", "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, the Company's expectations with respect to future performance. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside the Company's control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) unfavorable economic conditions that may affect our and our customers', suppliers' and other business partners' operations, financial condition and cash flows including spending on home renovation or construction projects, inflation, recessions, instability in the financial markets or credit markets; (2) increased supply chain costs, including raw materials, sourcing, transportation and energy; (3) the highly competitive nature of the markets that we serve; (4) the ability to continue to innovate with new products and services; (5) direct and indirect costs associated with the May 2023 ransomware attack, and our receipt of expected insurance receivables associated with that cyber security incident; (6) seasonality; (7) large customer concentration; (8) the ability to recruit and retain qualified employees; (9) the outcome of any legal proceedings that may be instituted against the Company; (10) adverse changes in currency exchange rates; or (11) regulatory changes and potential legislation that could adversely impact financial results. The foregoing list of factors is not exclusive, and readers should also refer to those risks that are included in the Company's filings with the Securities and Exchange Commission ("SEC"), including the Annual Report on Form 10-K filed on February 22, 2024. Given these uncertainties, current or prospective investors are cautioned not to place undue reliance on any such forward looking statements.
Except as required by applicable law, the Company does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements in this communication to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.
Contact:
Michael KoehlerVice President of Investor Relations &
HILLMAN SOLUTIONS CORP.
Condensed Consolidated Statement of Net Income (Loss), GAAP Basis(dollars in thousands) Unaudited
Thirteen WeeksEndedSeptember 28,2024
Thirteen WeeksEndedSeptember 30,2023
Thirty-nine WeeksEndedSeptember 28,2024
Thirty-nine WeeksEndedSeptember 30,2023
Net sales
$
393,296
$
398,943
$
1,123,033
$
1,128,669
Cost of sales (exclusive of depreciation and amortization shown separately below)
203,700
222,644
581,806
643,652
Selling, warehouse, general and administrative expenses
130,261
113,359
369,980
335,876
Depreciation
17,948
14,434
50,583
44,939
Amortization
15,354
15,583
45,857
46,733
Other (income) expense
(881
)
(1,819
)
3
841
Income from operations
26,914
34,742
74,804
56,628
Interest expense, net
15,108
16,728
44,316
52,880
Refinancing costs
—
—
3,008
—
Income before income taxes
11,806
18,014
27,480
3,748
Income tax expense
4,372
12,957
9,003
3,278
Net income
$
7,434
$
5,057
$
18,477
$
470
Basic income per share
$
0.04
$
0.03
$
0.09
$
0.00
Weighted average basic shares outstanding
196,297
194,794
195,914
194,662
Diluted income per share
$
0.04
$
0.03
$
0.09
$
0.00
Weighted average diluted shares outstanding
199,034
196,575
198,370
195,832
HILLMAN SOLUTIONS CORP.
Condensed Consolidated Balance Sheets(dollars in thousands)Unaudited
September 28, 2024
December 30, 2023
ASSETS
Current assets:
Cash and cash equivalents
$
59,820
$
38,553
Accounts receivable, net of allowances of 10,365 (2,770 - 2023)
129,633
103,482
Inventories, net
419,385
382,710
Other current assets
15,566
23,235
Total current assets
624,404
547,980
Property and equipment, net of accumulated depreciation of 374,289 (333,875 - 2023)
221,769
200,553
Goodwill
829,246
825,042
Other intangibles, net of accumulated amortization of 516,026 (470,791 - 2023)
622,562
655,293
Operating lease right of use assets
85,254
87,479
Other assets
14,332
14,754
Total assets
$
2,397,567
$
2,331,101
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
165,809
$
140,290
Current portion of debt and financing lease liabilities
13,039
9,952
Current portion of operating lease liabilities
16,331
14,407
Accrued expenses:
Salaries and wages
29,645
22,548
Pricing allowances
6,693
8,145
