30 September 202331 October 2025--12-3100010247952024-10-312023-01-3130 April 2023falseQ12024-12-312023-05-310001024795us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:UnpatentedTechnologyMember2022-01-010001024795hlio:CorporateReconcilingItemsAndEliminationsMember2022-01-010001024795us-gaap:RetainedEarningsMember2021-04-030001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-022022-04-020001024795hlio:CitibankMemberhlio:TermLoanMemberhlio:ShanghaiBranchTermLoanFacilityMember2022-04-020001024795srt:AsiaPacificMember2021-01-032021-04-030001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2022-01-010001024795hlio:TwoThousandNineteenEquityIncentivePlanMember2022-01-022022-04-020001024795hlio:NEMSRLMember2022-01-022022-04-020001024795us-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-04-020001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:ForeignCurrencyGainLossMember2022-01-022022-04-020001024795hlio:CitibankMemberhlio:FixedAssetFacilityMember2022-04-020001024795us-gaap:CustomerRelationshipsMember2022-01-010001024795hlio:HydraulicsMember2022-04-020001024795hlio:TradeNameAndBrandsMember2022-04-020001024795us-gaap:RevolvingCreditFacilityMembersrt:EuropeMember2022-04-020001024795hlio:CitibankMemberhlio:FixedAssetFacilityMember2022-01-022022-04-0200010247952021-01-020001024795us-gaap:PreferredStockMember2021-01-020001024795us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMember2022-04-020001024795us-gaap:ForeignExchangeContractMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795hlio:ElectronicsMember2022-04-020001024795hlio:CorporateReconcilingItemsAndEliminationsMember2022-01-022022-04-020001024795us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMember2022-01-010001024795hlio:ElectronicsMember2022-01-010001024795us-gaap:LiabilitiesTotalMember2022-04-020001024795hlio:HydraulicsMember2022-01-022022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:ElectronicsMember2022-01-010001024795hlio:RestrictedStockAndRestrictedStockUnitsMember2022-01-022022-04-020001024795hlio:ElectronicsMember2022-01-022022-04-020001024795hlio:WorkforceMember2022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:HydraulicsMember2022-04-020001024795us-gaap:CommonStockMember2022-04-020001024795us-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795us-gaap:CommonStockMember2021-01-020001024795hlio:RestrictedStockAndRestrictedStockUnitsMember2021-01-032021-04-030001024795us-gaap:OperatingSegmentsMemberhlio:HydraulicsMember2022-01-022022-04-020001024795us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestRateSwapMember2022-01-022022-04-020001024795us-gaap:UnpatentedTechnologyMember2022-04-020001024795us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMember2022-04-020001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-010001024795us-gaap:AdditionalPaidInCapitalMember2022-01-010001024795us-gaap:EmployeeStockOptionMember2022-01-022022-04-0200010247952022-01-022022-04-020001024795srt:MaximumMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-022022-04-020001024795hlio:CorporateReconcilingItemsAndEliminationsMember2022-04-020001024795hlio:OtherAccruedExpensesAndCurrentLiabilitiesMember2022-01-010001024795us-gaap:NondesignatedMemberus-gaap:OtherNoncurrentAssetsMemberus-gaap:ForeignExchangeForwardMember2022-04-020001024795hlio:TransferPricingDisputeResolutionMembersrt:MinimumMember2022-04-020001024795us-gaap:AdditionalPaidInCapitalMember2021-04-030001024795srt:AmericasMember2022-04-0200010247952022-04-020001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembersrt:MaximumMemberus-gaap:InterestRateSwapMember2022-01-022022-04-020001024795us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMember2022-01-010001024795us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForeignExchangeContractMember2022-01-010001024795hlio:OtherAccruedExpensesAndCurrentLiabilitiesMember2022-04-020001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2022-01-022022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:HydraulicsMember2022-01-010001024795us-gaap:CommonStockMember2021-01-032021-04-030001024795us-gaap:PreferredStockMember2021-04-030001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestRateSwapMember2021-01-032021-04-030001024795us-gaap:CommonStockMember2022-01-022022-04-020001024795us-gaap:OtherNoncurrentLiabilitiesMember2022-01-010001024795us-gaap:RealEstateMember2022-03-172022-03-170001024795hlio:WorkforceMember2022-01-010001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-04-030001024795hlio:CorporateReconcilingItemsAndEliminationsMember2021-01-032021-04-030001024795us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795hlio:EmployeeStockPurchasePlanAndUnitedKingdomPlanMember2022-04-020001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-01-032021-04-030001024795us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMember2022-04-020001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestRateSwapMember2022-04-020001024795hlio:EmployeeStockPurchasePlanAndUnitedKingdomPlanMember2021-01-032021-04-030001024795us-gaap:AccumulatedTranslationAdjustmentMember2022-01-010001024795srt:MaximumMember2022-04-020001024795hlio:InventoryTransactionsMember2021-01-032021-04-030001024795hlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2021-01-032021-04-030001024795hlio:RestrictedStockAndRestrictedStockUnitsMember2022-04-020001024795us-gaap:FairValueInputsLevel3Memberhlio:ContingentConsiderationMemberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:AccumulatedTranslationAdjustmentMember2021-01-032021-04-030001024795us-gaap:NoncompeteAgreementsMember2022-01-010001024795srt:AsiaPacificMember2022-04-020001024795us-gaap:RetainedEarningsMember2021-01-020001024795hlio:TwoThousandTwelveNonemployeeDirectorFeesPlanMember2021-01-032021-04-030001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherNoncurrentAssetsMemberus-gaap:InterestRateSwapMember2022-01-010001024795us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:OtherCurrentAssetsMember2022-04-020001024795us-gaap:NoncompeteAgreementsMember2022-04-020001024795hlio:CitibankMemberhlio:TermLoanMemberhlio:ShanghaiBranchTermLoanFacilityMember2022-01-022022-04-020001024795hlio:TimeBasedSharesMember2022-01-022022-04-020001024795srt:MaximumMemberhlio:TransferPricingDisputeResolutionMember2022-04-020001024795us-gaap:LiabilitiesTotalMember2022-01-010001024795us-gaap:CommonStockMember2022-01-010001024795srt:AsiaPacificMember2022-01-022022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:ElectronicsMember2022-04-020001024795us-gaap:AccumulatedTranslationAdjustmentMember2021-01-020001024795srt:AsiaPacificMember2022-01-010001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:ForeignCurrencyGainLossMember2021-01-032021-04-030001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2022-04-020001024795us-gaap:RetainedEarningsMember2021-01-032021-04-030001024795hlio:SydneyBranchTermLoanFacilityMemberhlio:CitibankMemberhlio:TermLoanMember2022-01-022022-04-020001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMembersrt:MinimumMemberus-gaap:InterestRateSwapMember2022-01-022022-04-020001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:OtherCurrentLiabilitiesMember2022-04-020001024795us-gaap:RevolvingCreditFacilityMemberhlio:CitibankMember2022-01-022022-04-020001024795us-gaap:EmployeeStockOptionMember2022-04-020001024795hlio:ContingentConsiderationMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795us-gaap:RetainedEarningsMember2022-04-020001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestRateSwapMember2022-01-022022-04-0200010247952021-01-032021-04-030001024795hlio:EmployeeStockPurchasePlanAndUnitedKingdomPlanMember2021-04-030001024795us-gaap:AccumulatedTranslationAdjustmentMember2022-04-020001024795hlio:SupplyAgreementMember2022-04-020001024795hlio:CitibankMember2022-04-020001024795us-gaap:RevolvingCreditFacilityMemberhlio:CitibankMember2022-04-020001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherNoncurrentAssetsMemberus-gaap:InterestRateSwapMember2022-04-020001024795us-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:FairValueInputsLevel3Memberhlio:ContingentConsiderationMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestExpenseMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestRateSwapMember2021-01-032021-04-030001024795us-gaap:RevolvingCreditFacilityMemberhlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-01-022022-04-020001024795us-gaap:CommonStockMember2021-04-030001024795us-gaap:AccumulatedTranslationAdjustmentMember2021-04-030001024795us-gaap:PerformanceSharesMember2022-01-022022-04-020001024795hlio:JoyonwayMemberhlio:HydraulicsMember2022-01-022022-04-020001024795us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-01-0200010247952022-01-010001024795srt:AmericasMember2022-01-022022-04-020001024795us-gaap:AdditionalPaidInCapitalMember2021-01-032021-04-030001024795us-gaap:RestrictedStockUnitsRSUMembersrt:MinimumMember2022-01-022022-04-020001024795us-gaap:AdditionalPaidInCapitalMember2022-01-022022-04-020001024795us-gaap:FairValueInputsLevel2Memberus-gaap:ForeignExchangeContractMemberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795hlio:ContingentConsiderationMemberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795us-gaap:EmployeeStockMember2022-01-022022-04-020001024795hlio:SydneyBranchTermLoanFacilityMemberhlio:CitibankMemberhlio:TermLoanMember2022-04-020001024795hlio:CitibankMember2022-01-022022-04-020001024795us-gaap:EMEAMember2021-01-032021-04-030001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMember2022-01-022022-04-020001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-04-030001024795us-gaap:RevolvingCreditFacilityMemberhlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-01-010001024795hlio:CitibankMember2022-01-010001024795us-gaap:NondesignatedMemberus-gaap:OtherNoncurrentAssetsMemberus-gaap:ForeignExchangeForwardMember2022-01-010001024795us-gaap:RevolvingCreditFacilityMemberhlio:CitibankMember2022-01-010001024795hlio:EmployeeStockPurchasePlanAndUnitedKingdomPlanMember2022-01-022022-04-020001024795us-gaap:PreferredStockMember2022-01-010001024795hlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-04-020001024795us-gaap:RevolvingCreditFacilityMemberhlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-04-020001024795srt:EuropeMember2022-04-020001024795us-gaap:EMEAMember2022-01-022022-04-020001024795us-gaap:EMEAMember2022-01-010001024795us-gaap:InterestRateSwapMemberus-gaap:FairValueMeasurementsRecurringMember2022-01-0100010247952022-04-290001024795us-gaap:CashFlowHedgingMember2021-01-032021-04-030001024795hlio:CitibankMemberhlio:WorkingCapitalFacilityMember2022-01-022022-04-020001024795hlio:JoyonwayMemberhlio:ElectronicsMember2022-01-022022-04-0200010247952022-01-012022-04-020001024795hlio:NEMSRLMemberhlio:ElectronicsMember2022-01-022022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:ElectronicsMember2021-01-032021-04-030001024795hlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-01-022022-04-020001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-032021-04-030001024795hlio:SupplyAgreementMember2022-01-010001024795hlio:JoyonwayMember2022-01-022022-04-020001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:OtherCurrentAssetsMember2022-01-010001024795us-gaap:OperatingSegmentsMemberhlio:HydraulicsMember2021-01-032021-04-030001024795hlio:InventoryTransactionsMember2022-01-022022-04-020001024795srt:MinimumMember2022-04-020001024795us-gaap:OtherNoncurrentLiabilitiesMember2022-04-020001024795us-gaap:AccumulatedTranslationAdjustmentMember2022-01-022022-04-020001024795us-gaap:CustomerRelationshipsMember2022-04-020001024795us-gaap:RetainedEarningsMember2022-01-022022-04-020001024795hlio:CitibankMemberhlio:WorkingCapitalFacilityMember2022-04-020001024795us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-01-010001024795hlio:NEMSRLMemberhlio:HydraulicsMember2022-01-022022-04-020001024795hlio:TradeNameAndBrandsMember2022-01-010001024795us-gaap:NondesignatedMemberus-gaap:ForeignExchangeForwardMemberus-gaap:OtherCurrentLiabilitiesMember2022-01-010001024795us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-04-020001024795hlio:HydraulicsMember2022-01-010001024795us-gaap:EMEAMember2022-04-020001024795us-gaap:PreferredStockMember2022-04-020001024795hlio:PNCBankNationalAssociationAsAdministrativeAgentAndLenderPartyMember2022-01-010001024795us-gaap:CashFlowHedgingMember2022-01-012022-04-020001024795us-gaap:RestrictedStockUnitsRSUMember2022-04-020001024795us-gaap:OperatingSegmentsMemberhlio:ElectronicsMember2022-01-022022-04-020001024795us-gaap:AdditionalPaidInCapitalMember2021-01-020001024795us-gaap:AdditionalPaidInCapitalMember2022-04-020001024795us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-020001024795us-gaap:RetainedEarningsMember2022-01-0100010247952021-04-030001024795srt:AmericasMember2022-01-010001024795srt:AmericasMember2021-01-032021-04-030001024795us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForeignExchangeContractMember2022-04-02iso4217:AUDiso4217:EURhlio:Countryxbrli:purexbrli:shareshlio:Segmentiso4217:CNYiso4217:USDxbrli:shareshlio:Contractiso4217:USD

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 2, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 0-21835

 

HELIOS TECHNOLOGIES, INC.

(Exact Name of Registration as Specified in its Charter)

 

 

Florida

 

59-2754337

(State or Other Jurisdiction of

Incorporation or Organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

7456 16th St E

SARASOTA, Florida

 

34243

(Address of Principal Executive Offices)

 

(Zip Code)

 

(941)362-1200

(Registrant’s Telephone Number, Including Area Code)

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock $.001 Par Value

 

HLIO

 

The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YesNo

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YesNo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

Non-accelerated filer

 

 

Smaller Reporting Company

 

 

 

 

 

Emerging growth company

 

 

 

 

 

 

 

 

 

 


 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

The registrant had 32,485,571 shares of common stock, par value $.001, outstanding as of April 29, 2022.

 


 

Helios Technologies, Inc.

INDEX

For the quarter ended

April 2, 2022

 

 

 

Page

 

 

 

PART I. FINANCIAL INFORMATION

 

3

 

 

 

 

 

Item 1.

Financial Statements

 

3

 

 

 

 

 

Consolidated Balance Sheets as of April 2, 2022 (unaudited) and January 1, 2022

 

3

 

 

 

 

 

Consolidated Statements of Operations for the Three Months Ended April 2, 2022 (unaudited) and April 3, 2021 (unaudited)

 

4

 

 

 

 

 

Consolidated Statements of Comprehensive Income for the Three Months Ended April 2, 2022 (unaudited) and April 3, 2021 (unaudited)

 

5

 

 

 

 

 

Consolidated Statements of Shareholders’ Equity for the Three Months Ended April 2, 2022 (unaudited) and April 3, 2021 (unaudited)

 

6

 

 

 

 

 

Consolidated Statements of Cash Flows for the Three Months Ended April 2, 2022 (unaudited) and April 3, 2021 (unaudited)

 

7

 

 

 

 

 

Condensed Notes to the Consolidated, Unaudited Financial Statements

 

8

 

 

 

 

 

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

20

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

28

 

 

 

 

 

 

Item 4.

Controls and Procedures

 

28

 

 

 

 

PART II. OTHER INFORMATION

 

29

 

 

 

 

 

 

Item 1.

Legal Proceedings

 

29

 

 

 

 

 

 

Item 1A.

Risk Factors

 

29

 

 

 

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

29

 

 

 

 

 

 

Item 3.

Defaults Upon Senior Securities

 

29

 

 

 

 

 

 

Item 4.

Mine Safety Disclosures

 

29

 

 

 

 

 

 

Item 5.

Other Information

 

29

 

 

 

 

 

 

Item 6.

Exhibits

 

30

 

 

2


 

PART I: FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS.

Helios Technologies, Inc.

Consolidated Balance Sheets

(in thousands, except per share data)

 

 

April 2, 2022

 

 

January 1, 2022

 

 

 

(unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

33,019

 

 

$

28,540

 

Restricted cash

 

 

39

 

 

 

41

 

Accounts receivable, net of allowance for credit losses of $1,119 and $1,212

 

 

151,350

 

 

 

134,561

 

Inventories, net

 

 

180,290

 

 

 

165,629

 

Income taxes receivable

 

 

1,796

 

 

 

2,762

 

Other current assets

 

 

21,871

 

 

 

20,101

 

Total current assets

 

 

388,365

 

 

 

351,634

 

Property, plant and equipment, net

 

 

170,411

 

 

 

174,210

 

Deferred income taxes

 

 

4,183

 

 

 

2,934

 

Goodwill

 

 

452,654

 

 

 

459,936

 

Other intangible assets, net

 

 

399,946

 

 

 

412,759

 

Other assets

 

 

19,322

 

 

 

13,873

 

Total assets

 

$

1,434,881

 

 

$

1,415,346

 

Liabilities and shareholders' equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

89,117

 

 

$

85,301

 

Accrued compensation and benefits

 

 

18,636

 

 

 

28,595

 

Other accrued expenses and current liabilities

 

 

29,863

 

 

 

28,254

 

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

 

 

18,141

 

 

 

18,125

 

Dividends payable

 

 

2,924

 

 

 

2,917

 

Income taxes payable

 

 

14,362

 

 

 

6,328

 

Total current liabilities

 

 

173,043

 

 

 

169,520

 

Revolving line of credit

 

 

238,932

 

 

 

242,312

 

Long-term non-revolving debt, net

 

 

179,864

 

 

 

183,897

 

Deferred income taxes

 

 

70,144

 

 

 

71,836

 

Other noncurrent liabilities

 

 

37,262

 

 

 

38,818

 

Total liabilities

 

 

699,245

 

 

 

706,383

 

Commitments and contingencies

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Preferred stock, par value $0.001, 2,000 shares authorized,
   
no shares issued or outstanding

 

 

 

 

 

 

Common stock, par value $0.001, 100,000 shares authorized,
   
32,478 and 32,407 shares issued and outstanding

 

 

32

 

 

 

32

 

Capital in excess of par value

 

 

395,873

 

 

 

394,641

 

Retained earnings

 

 

390,831

 

 

 

363,279

 

Accumulated other comprehensive loss

 

 

(51,100

)

 

 

(48,989

)

Total shareholders' equity

 

 

735,636

 

 

 

708,963

 

Total liabilities and shareholders' equity

 

$

1,434,881

 

 

$

1,415,346

 

 

The accompanying Condensed Notes to the Consolidated, Unaudited Financial Statements are an integral part of these financial statements.

3


 

Helios Technologies, Inc.

Consolidated Statements of Operations

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

 

 

(unaudited)

 

 

(unaudited)

 

Net sales

 

$

240,547

 

 

$

204,844

 

Cost of sales

 

 

156,904

 

 

 

129,477

 

Gross profit

 

 

83,643

 

 

 

75,367

 

Selling, engineering and administrative expenses

 

 

33,776

 

 

 

30,561

 

Amortization of intangible assets

 

 

6,980

 

 

 

10,198

 

Operating income

 

 

42,887

 

 

 

34,608

 

Interest expense, net

 

 

3,809

 

 

 

4,751

 

Foreign currency transaction (gain) loss, net

 

 

(924

)

 

 

464

 

Other non-operating expense (income), net

 

 

750

 

 

 

(1

)

Income before income taxes

 

 

39,252

 

 

 

29,394

 

Income tax provision

 

 

8,774

 

 

 

6,807

 

Net income

 

$

30,478

 

 

$

22,587

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

Basic

 

$

0.94

 

 

$

0.70

 

Diluted

 

$

0.94

 

 

$

0.70

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

Basic

 

 

32,439

 

 

 

32,193

 

Diluted

 

 

32,565

 

 

 

32,345

 

 

 

 

 

 

 

 

Dividends declared per share

 

$

0.09

 

 

$

0.09

 

 

The accompanying Condensed Notes to the Consolidated, Unaudited Financial Statements are an integral part of these financial statements.

4


 

Helios Technologies, Inc.

Consolidated Statements of Comprehensive Income

(in thousands)

 

 

 

Three Months Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

 

 

(unaudited)

 

 

(unaudited)

 

Net income

 

$

30,478

 

 

$

22,587

 

Other comprehensive loss

 

 

 

 

 

 

Foreign currency translation adjustments, net of tax

 

 

(7,735

)

 

 

(9,118

)

Unrealized gain on interest rate swap, net of tax

 

 

5,624

 

 

 

1,705

 

Total other comprehensive loss

 

 

(2,111

)

 

 

(7,413

)

Comprehensive income

 

$

28,367

 

 

$

15,174

 

 

The accompanying Condensed Notes to the Consolidated, Unaudited Financial Statements are an integral part of these financial statements.

 

5


 

Helios Technologies, Inc.

Consolidated Statements of Shareholders’ Equity (unaudited)

Three Months Ended

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital in

 

 

 

 

 

other

 

 

 

 

 

 

Preferred

 

 

Preferred

 

 

Common

 

 

Common

 

 

excess of

 

 

Retained

 

 

comprehensive

 

 

 

 

 

 

shares

 

 

stock

 

 

shares

 

 

stock

 

 

par value

 

 

earnings

 

 

loss

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 1, 2022

 

 

 

 

$

 

 

 

32,407

 

 

$

32

 

 

$

394,641

 

 

$

363,279

 

 

$

(48,989

)

 

$

708,963

 

Shares issued, restricted stock

 

 

 

 

 

 

 

 

64

 

 

 

 

 

 

70

 

 

 

 

 

 

 

 

 

70

 

Shares issued, ESPP

 

 

 

 

 

 

 

 

7

 

 

 

 

 

 

530

 

 

 

 

 

 

 

 

 

530

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,494

 

 

 

 

 

 

 

 

 

2,494

 

Cancellation of shares for payment of employee tax withholding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,862

)

 

 

 

 

 

 

 

 

(1,862

)

Dividends declared

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,926

)

 

 

 

 

 

(2,926

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30,478

 

 

 

 

 

 

30,478

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,111

)

 

 

(2,111

)

Balance at April 2, 2022

 

 

 

 

$

 

 

 

32,478

 

 

$

32

 

 

$

395,873

 

 

$

390,831

 

 

$

(51,100

)

 

$

735,636

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 2, 2021

 

 

 

 

$

 

 

 

32,120

 

 

$

32

 

 

$

371,778

 

 

$

270,320

 

 

$

(34,340

)

 

$

607,790

 

Shares issued, restricted stock

 

 

 

 

 

 

 

 

30

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued, other compensation

 

 

 

 

 

 

 

 

7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued, ESPP

 

 

 

 

 

 

 

 

10

 

 

 

 

 

 

333

 

 

 

 

 

 

 

 

 

333

 

Shares issued, acquisition

 

 

 

 

 

 

 

 

63

 

 

 

 

 

 

3,624

 

 

 

 

 

 

 

 

 

3,624

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,107

 

 

 

 

 

 

 

 

 

2,107

 

Cancellation of shares for payment of employee tax withholding

 

 

 

 

 

 

 

 

(4

)

 

 

 

 

 

(848

)

 

 

 

 

 

 

 

 

(848

)

Dividends declared

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,900

)

 

 

 

 

 

(2,900

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

22,587

 

 

 

 

 

 

22,587

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,413

)

 

 

(7,413

)

Balance at April 3, 2021

 

 

 

 

$

 

 

 

32,226

 

 

$

32

 

 

$

376,994

 

 

$

290,007

 

 

$

(41,753

)

 

$

625,280

 

 

The accompanying Condensed Notes to the Consolidated, Unaudited Financial Statements are an integral part of these financial statements.

6


 

Helios Technologies, Inc.

Consolidated Statements of Cash Flows

(in thousands)

 

 

Three Months Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

30,478

 

 

$

22,587

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

12,554

 

 

 

15,237

 

Stock-based compensation expense

 

 

2,494

 

 

 

2,107

 

Amortization of debt issuance costs

 

 

125

 

 

 

125

 

Benefit for deferred income taxes

 

 

(1,082

)

 

 

(906

)

Forward contract gains, net

 

 

(1,577

)

 

 

(2,402

)

Other, net

 

 

696

 

 

 

32

 

(Increase) decrease in:

 

 

 

 

 

 

Accounts receivable

 

 

(17,418

)

 

 

(28,051

)

Inventories

 

 

(15,471

)

 

 

(10,809

)

Income taxes receivable

 

 

938

 

 

 

565

 

Other current assets

 

 

(2,403

)

 

 

(2,614

)

Other assets

 

 

2,202

 

 

 

2,139

 

Increase (decrease) in:

 

 

 

 

 

 

Accounts payable

 

 

4,136

 

 

 

13,912

 

Accrued expenses and other liabilities

 

 

(8,053

)

 

 

(2,147

)

Income taxes payable

 

 

8,177

 

 

 

6,126

 

Other noncurrent liabilities

 

 

(1,108

)

 

 

(819

)

Net cash provided by operating activities

 

 

14,688

 

 

 

15,082

 

Cash flows from investing activities:

 

 

 

 

 

 

Acquisition of a business, net of cash acquired

 

 

1,271

 

 

 

(1,000

)

Amounts paid for net assets acquired

 

 

 

 

 

(2,400

)

Capital expenditures

 

 

(5,630

)

 

 

(5,036

)

Proceeds from dispositions of equipment

 

 

1,837

 

 

 

35

 

Cash settlement of forward contracts

 

 

707

 

 

 

1,544

 

Software development costs

 

 

(874

)

 

 

(623

)

Net cash used in investing activities

 

 

(2,689

)

 

 

(7,480

)

Cash flows from financing activities:

 

 

 

 

 

 

Borrowings on revolving credit facilities

 

 

23,548

 

 

 

6,602

 

Repayment of borrowings on revolving credit facilities

 

 

(23,605

)

 

 

(8,500

)

Repayment of borrowings on long-term non-revolving debt

 

 

(4,201

)

 

 

(4,029

)

Proceeds from stock issued

 

 

600

 

 

 

333

 

Dividends to shareholders

 

 

(2,917

)

 

 

(2,891

)

Other financing activities

 

 

(2,259

)

 

 

(974

)

Net cash used in financing activities

 

 

(8,834

)

 

 

(9,459

)

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

 

 

1,312

 

 

 

2,565

 

Net increase in cash, cash equivalents and restricted cash

 

 

4,477

 

 

 

708

 

Cash, cash equivalents and restricted cash, beginning of period

 

 

28,581

 

 

 

25,257

 

Cash, cash equivalents and restricted cash, end of period

 

$

33,058

 

 

$

25,965

 

 

The accompanying Condensed Notes to the Consolidated, Unaudited Financial Statements are an integral part of these financial statements.

7


 

HELIOS TECHNOLOGIES, INC.

CONDENSED NOTES TO THE CONSOLIDATED, UNAUDITED FINANCIAL STATEMENTS

(Currencies in thousands, except per share data)

 

 

1. COMPANY BACKGROUND

Helios Technologies, Inc. (“Helios,” or the “Company”) together with its wholly owned subsidiaries, is a global leader in highly engineered motion control and electronic controls technology for diverse end markets, including construction, material handling, agriculture, energy, recreational vehicles, marine and health and wellness. Helios sells its products to customers in over 90 countries around the world. The Company’s strategy for growth is to be the leading provider in niche markets, with premier products and solutions through innovative product development and acquisitions.

The Company operates in two business segments: Hydraulics and Electronics. There are three key technologies within the Hydraulics segment: cartridge valve technology (“CVT”), quick-release hydraulic coupling solutions (“QRC”) and hydraulic system design (“Systems”). CVT products provide functions important to a hydraulic system: to control rates and direction of fluid flow and to regulate and control pressures. QRC products allow users to connect and disconnect quickly from any hydraulic circuit without leakage and ensure high-performance under high temperature and pressure using one or multiple couplers. Systems provide engineered solutions for machine users, manufacturers or designers to fulfill complete system design requirements including electro-hydraulic, remote control, electronic control and programmable logic controller systems, as well as automation of existing equipment. The Electronics segment provides complete, fully-tailored display and control solutions for engines, engine-driven equipment, specialty vehicles, therapy baths and traditional and swim spas. This broad range of products is complemented by extensive application expertise and unparalleled depth of software, embedded programming, hardware and sustaining engineering teams.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for reporting on Form 10-Q. Accordingly, certain information and footnotes required by accounting principles generally accepted in the United States of America (“U.S. GAAP”) for complete financial statements are not included herein. The financial statements are prepared on a consistent basis (including normal recurring adjustments) and should be read in conjunction with the consolidated financial statements and related notes contained in the Annual Report on Form 10-K for the fiscal year ended January 1, 2022 (“Form 10-K”), filed by Helios with the Securities and Exchange Commission on March 1, 2022. In management’s opinion, all adjustments necessary for a fair presentation of the Company’s financial statements are reflected in the interim periods presented. Operating results for the three months ended April 2, 2022 are not necessarily indicative of the results that may be expected for the fiscal year ended December 31, 2022.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

8


 

Earnings Per Share

The following table presents the computation of basic and diluted earnings per common share (in thousands, except per share data):

 

 

Three Months Ended

 

 

 

April 2, 2022

 

 

April 3, 2021

 

Net income

 

$

30,478

 

 

$

22,587

 

 

 

 

 

 

 

 

Weighted average shares outstanding - Basic

 

 

32,439

 

 

 

32,193

 

Net effect of dilutive securities - Stock based compensation

 

 

126

 

 

 

152</