Full Year 2025 Net Sales increased 5.4% to a record
Midpoint of 2026 Net Sales guidance reflects an increase of 6.3% versus 2025
Fourth Quarter 2025 Highlights (Thirteen Weeks Ended
- Net sales increased 4.5% to
$365.1 million versus Q4 2024 - Net income totaled
$1.6 million , or$0.01 per diluted share, compared to net loss of$(1.2) million , or$(0.01) per diluted share, in the prior year quarter - Adjusted diluted EPS1 was
$0.10 per diluted share compared to$0.10 per diluted share in the prior year quarter - Adjusted EBITDA1 increased 2.3% to
$57.5 million versus Q4 2024
Full Year 2025 Highlights (Fifty-Two Weeks Ended
- Net sales increased 5.4% to a record
$1.55 billion versus 2024 - Net income totaled
$40.3 million , or$0.20 per diluted share, compared to net loss of$17.3 million , or$0.09 per diluted share, in 2024 - Adjusted diluted EPS1 was
$0.58 per diluted share, compared to$0.49 per diluted share in 2024 - Adjusted EBITDA1 increased 13.9% to
$275.3 million versus 2024 - Net cash provided by operating activities totaled
$105 .2 million compared to$183 .3 million in 2024 - Free Cash Flow1 totaled
$35 .1 million compared to$98 .1 million in 2024 - Hillman repurchased approximately 1.4 million shares of its common stock at an average price of
$9.07 per share, totaling$12 .4 million
Balance Sheet and Liquidity at
- Gross debt decreased to
$693.1 million from$718.6 million atDecember 30, 2024 - Net debt1 decreased to
$665.8 million from$674.0 million atDecember 30, 2024 - Liquidity available totaled
$306 million , consisting of$279 million of available borrowing under the revolving credit facility and$27 million of cash and equivalents - Net debt1 to trailing twelve month Adjusted EBITDA improved to 2.4x times from 2.8x at
December 30, 2024
Management Commentary
"We continued prudent investing into growth opportunities during year, including our MinuteKey 3.5 fleet, which we expect to generate healthy returns on invested capital during 2026 and beyond.
"Looking to 2026, we are confident we will grow both our top and bottom line, while we seek strategic opportunities to grow via M&A and expand our leading market share position. We remain focused on driving value for shareholders during 2026 and beyond."
Full Year 2026 Guidance
Hillman has provided the following guidance based on its current view of the market and its performance expectations during fiscal 2026.
| Full Year 2026 Guidance | |
| Adjusted EBITDA1 | |
| Free Cash Flow1 |
- Adjusted EBITDA, Adjusted Diluted EPS, Net Debt, and Free Cash Flow are non-GAAP financial measures. Refer to the "Reconciliation of Adjusted EBITDA”, "Reconciliation of Adjusted Earnings per Share", "Reconciliation of Net Debt" and "Reconciliation of Free Cash Flow" sections of this press release for additional information as well as reconciliations between the company’s GAAP and non-GAAP financial results
Fourth Quarter and Full Year 2025 Results Presentation
Hillman plans to host a conference call and webcast presentation today,
| Date: Today, | ||
| Time: | ||
| Listen-only Webcast: https://edge.media-server.com/mmc/p/3tnsam2j | ||
A webcast replay will be available approximately one hour after the conclusion of the call using the Audio-Only Webcast link above.
Hillman’s earnings release and results presentation are expected to be filed with the
About
Forward Looking Statements
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 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 tariffs, 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) seasonality; (6) large customer concentration; (7) the ability to recruit and retain qualified employees; (8) the outcome of any legal proceedings that may be instituted against the Company; (9) adverse changes in currency exchange rates; or (10) 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 its Annual Report on Form 10-K for the fiscal year ended
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:
Vice President of Investor Relations &
513-826-5495
IR@hillmangroup.com
Condensed Consolidated Statement of Net Income, GAAP Basis
(dollars in thousands)
Unaudited
| Thirteen Weeks Ended | Thirteen Weeks Ended | Fifty-two Weeks Ended | Fifty-two Weeks Ended | ||||||||||
| Net sales | $ | 365,139 | $ | 349,562 | $ | 1,552,224 | $ | 1,472,595 | |||||
| Cost of sales (exclusive of depreciation and amortization shown separately below) | 191,419 | 182,885 | 795,875 | 764,691 | |||||||||
| Selling, warehouse, general and administrative expenses | 120,899 | 118,722 | 502,000 | 488,702 | |||||||||
| Depreciation | 20,527 | 18,183 | 79,870 | 68,766 | |||||||||
| Amortization | 15,295 | 15,417 | 61,232 | 61,274 | |||||||||
| Other expense (income), net | 266 | 358 | (722 | ) | 361 | ||||||||
| Income from operations | 16,733 | 13,997 | 113,969 | 88,801 | |||||||||
| Interest expense, net | 13,423 | 14,925 | 56,467 | 59,241 | |||||||||
| Refinancing costs | — | — | 906 | 3,008 | |||||||||
| Income (loss) before income taxes | 3,310 | (928 | ) | 56,596 | 26,552 | ||||||||
| Income tax expense | 1,712 | 294 | 16,291 | 9,297 | |||||||||
| Net income (loss) | $ | 1,598 | $ | (1,222 | ) | $ | 40,305 | $ | 17,255 | ||||
| Basic income (loss) per share | $ | 0.01 | $ | (0.01 | ) | $ | 0.20 | $ | 0.09 | ||||
| Weighted average basic shares outstanding | 197,167 | 196,689 | 197,451 | 196,108 | |||||||||
| Diluted income (loss) per share | $ | 0.01 | $ | (0.01 | ) | $ | 0.20 | $ | 0.09 | ||||
| Weighted average diluted shares outstanding | 199,552 | 196,689 | 199,480 | 198,915 | |||||||||
Condensed Consolidated Balance Sheets
(dollars in thousands)
Unaudited
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 27,276 | $ | 44,510 | |||
| Accounts receivable, net of allowances of | 114,926 | 109,788 | |||||
| Inventories, net | 485,938 | 403,673 | |||||
| Other current assets | 18,342 | 15,213 | |||||
| Total current assets | 646,482 | 573,184 | |||||
| Property and equipment, net of accumulated depreciation of | 231,482 | 224,174 | |||||
| 830,747 | 828,553 | ||||||
| Other intangibles, net of accumulated amortization of | 546,171 | 605,859 | |||||
| Operating lease right of use assets | 75,152 | 81,708 | |||||
| Other assets | 26,160 | 17,025 | |||||
| Total assets | $ | 2,356,194 | $ | 2,330,503 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 141,662 | $ | 139,057 | |||
| Current portion of debt and finance lease obligations | 14,830 | 12,975 | |||||
| Current portion of operating lease liabilities | 17,947 | 16,850 | |||||
| Accrued expenses: | |||||||
| Salaries and wages | 35,790 | 34,977 | |||||
| Pricing allowances | 8,098 | 7,651 | |||||
| Income and other taxes | 9,466 | 10,377 | |||||
| Other accrued expenses | 29,766 | 31,843 | |||||
| Total current liabilities | 257,559 | 253,730 | |||||
| Long-term debt | 668,337 | 691,726 | |||||
| Deferred tax liabilities | 131,870 | 124,611 | |||||
| Operating lease liabilities | 63,459 | 71,474 | |||||
| Other non-current liabilities | 6,462 | 6,591 | |||||
| Total liabilities | 1,127,687 | 1,148,132 | |||||
| Commitments and Contingencies | |||||||
| Stockholders' equity: | |||||||
| Common stock, 0.0001 par, 500,000,000 shares authorized, 197,857,100 and 196,487,532 issued and outstanding at | 20 | 20 | |||||
| (12,423 | ) | — | |||||
| Additional paid-in capital | 1,457,422 | 1,442,958 | |||||
| Accumulated deficit | (178,646 | ) | (218,951 | ) | |||
| Accumulated other comprehensive loss | (37,866 | ) | (41,656 | ) | |||
| Total stockholders' equity | 1,228,507 | 1,182,371 | |||||
| Total liabilities and stockholders' equity | $ | 2,356,194 | $ | 2,330,503 | |||
Condensed Consolidated Statement of Cash Flows
(dollars in thousands)
Unaudited
| Year Ended | Year Ended | ||||||
| Cash flows from operating activities: | |||||||
| Net income | $ | 40,305 | $ | 17,255 | |||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
| Depreciation and amortization | 141,102 | 130,040 | |||||
| Gain on dispositions of property and equipment | 73 | 56 | |||||
| Deferred income taxes | 4,717 | (5,038 | ) | ||||
| Deferred financing and original issue discount amortization | 5,021 | 5,065 | |||||
| Loss on debt restructuring, net of third party fees paid | 906 | 3,008 | |||||
| Cash paid to third parties in connection with debt restructuring | (906 | ) | (1,554 | ) | |||
| Stock-based compensation expense | 14,246 | 13,463 | |||||
| Customer bankruptcy reserve | — | 8,640 | |||||
| Change in fair value of contingent consideration | (240 | ) | 228 | ||||
| Changes in operating items: | |||||||
| Accounts receivable, net | (4,121 | ) | (4,545 | ) | |||
| Inventories, net | (79,432 | ) | 8,710 | ||||
| Other assets | (14,980 | ) | (6,004 | ) | |||
| Accounts payable | 1,689 | (7,784 | ) | ||||
| Accrued salaries and wages | 711 | 12,707 | |||||
| Other accrued liabilities | (3,906 | ) | 9,089 | ||||
| Net cash provided by operating activities | 105,185 | 183,336 | |||||
| Cash flows from investing activities: | |||||||
| Acquisition of business, net of cash received | — | (57,900 | ) | ||||
| Capital expenditures | (70,100 | ) | (85,219 | ) | |||
| Other investing activities | (251 | ) | (278 | ) | |||
| Net cash used for investing activities | (70,351 | ) | (143,397 | ) | |||
| Cash flows from financing activities: | |||||||
| Repayments of senior term loans | (8,512 | ) | (106,383 | ) | |||
| Borrowings of revolving credit loans | 131,000 | 177,000 | |||||
| Repayments of revolving credit loans | (157,000 | ) | (115,000 | ) | |||
| Repurchases of common stock | (12,423 | ) | — | ||||
| Financing fees | — | (33 | ) | ||||
| Principal payments under finance lease obligations | (5,683 | ) | (3,682 | ) | |||
| Proceeds from exercise of stock options | 1,207 | 9,657 | |||||
| Payments of contingent consideration | (265 | ) | (260 | ) | |||
| Other financing activities | (544 | ) | (567 | ) | |||
| Net cash used for financing activities | (52,220 | ) | (39,268 | ) | |||
| Effect of exchange rate changes on cash | 152 | 5,286 | |||||
| Net (decrease) increase in cash and cash equivalents | (17,234 | ) | 5,957 | ||||
| Cash and cash equivalents at beginning of period | 44,510 | 38,553 | |||||
| Cash and cash equivalents at end of period | $ | 27,276 | $ | 44,510 | |||
Reconciliations of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measures
The Company uses non-GAAP financial measures to analyze underlying business performance and trends. The Company believes that providing these non-GAAP financial measures enhances the Company’s and investors’ ability to compare the Company’s past financial performance with its current performance. These non-GAAP financial measures are provided as supplemental information to the financial measures presented in this press release that are calculated and presented in accordance with GAAP. Non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures determined or calculated in accordance with GAAP. The Company’s definitions of its non-GAAP financial measures may not be comparable to similarly titled measures reported by other companies. Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, reconciliations to GAAP financial measures are not provided for forward-looking non-GAAP measures. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.
Non-GAAP financial measures such as consolidated adjusted EBITDA and Adjusted Diluted Earnings per Share (EPS) exclude from the relevant GAAP metrics items that neither relate to the ordinary course of the Company’s business, nor reflect the Company’s underlying business performance.
Reconciliation of Adjusted EBITDA (Unaudited)
(dollars in thousands)
Adjusted EBITDA is a non-GAAP financial measure and is the primary basis used to measure the operational strength and performance of our businesses, as well as to assist in the evaluation of underlying trends in our businesses. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of our businesses and from intangible assets recognized in business combinations. It is also unaffected by our capital and tax structures, as our management excludes these results when evaluating our operating performance. Our management and Board of Directors use this financial measure to evaluate our consolidated operating performance and the operating performance of our operating segments and to allocate resources and capital to our operating segments. Additionally, we believe that Adjusted EBITDA is useful to investors because it is one of the bases for comparing our operating performance with that of other companies in our industries, although our measure of Adjusted EBITDA may not be directly comparable to similar measures used by other companies.
| Thirteen Weeks Ended | Thirteen Weeks Ended | Fifty-two Weeks Ended 2025 | Fifty-two Weeks Ended | ||||||||||
| Net income (loss) | $ | 1,598 | $ | (1,222 | ) | $ | 40,305 | $ | 17,255 | ||||
| Income tax expense | 1,712 | 294 | 16,291 | 9,297 | |||||||||
| Interest expense, net | 13,423 | 14,925 | 56,467 | 59,241 | |||||||||
| Depreciation | 20,527 | 18,183 | 79,870 | 68,766 | |||||||||
| Amortization | 15,295 | 15,417 | 61,232 | 61,274 | |||||||||
| EBITDA | $ | 52,555 | $ | 47,597 | $ | 254,165 | $ | 215,833 | |||||
| Stock compensation expense | 3,507 | 3,721 | 14,246 | 13,463 | |||||||||
| Restructuring and other costs(1) | 1,198 | (214 | ) | 4,058 | 2,978 | ||||||||
| Litigation expense(2) | — | 5,000 | 1,950 | 5,000 | |||||||||
| Transaction and integration expense(3) | 17 | 250 | 232 | 1,243 | |||||||||
| Change in fair value of contingent consideration | 260 | (85 | ) | (240 | ) | 228 | |||||||
| Refinancing charges(4) | — | — | 906 | 3,008 | |||||||||
| Total adjusting items | $ | 4,982 | $ | 8,672 | $ | 21,152 | $ | 25,920 | |||||
| Adjusted EBITDA | $ | 57,537 | $ | 56,269 | $ | 275,317 | $ | 241,753 | |||||
| (1) | Restructuring and other costs includes consulting and other costs associated with severance related to our distribution center relocations and corporate restructuring activities. 2024 includes costs associated with the Cybersecurity Incident that occurred in | |
| (2) | Litigation expense includes an accrual for the tentative settlement of a | |
| (3) | Transaction and integration expense includes professional fees and other costs related to acquisition activity, including without limitation the | |
| (4) | In the first quarters of 2025 and 2024, we entered into a Repricing Amendment (2025 Repricing Amendment and 2024 Repricing Amendment) on our existing Senior Term Loan due |
Reconciliation of Adjusted Diluted EPS
(in thousands, except per share data)
Unaudited
We define Adjusted Diluted EPS as reported diluted EPS excluding the effect of one-time, non-recurring activity and volatility associated with our income tax expense. The Company believes that Adjusted Diluted EPS provides further insight and comparability in operating performance as it eliminates the effects of certain items that are not comparable from one period to the next. The following is a reconciliation of reported diluted EPS from continuing operations to Adjusted Diluted EPS from continuing operations:
| Thirteen Weeks Ended | Thirteen Weeks Ended | Fifty-two Weeks Ended | Fifty-two Weeks Ended | |||||||||||||
| Reconciliation to Adjusted Net Income | ||||||||||||||||
| Net Income (Loss) | $ | 1,598 | $ | (1,222 | ) | $ | 40,305 | $ | 17,255 | |||||||
| Remove adjusting items(1) | 4,982 | 8,672 | 21,152 | 25,920 | ||||||||||||
| Remove amortization expense | 15,295 | 15,417 | 61,232 | 61,274 | ||||||||||||
| Remove tax benefit on adjusting items and amortization expense(2) | (1,867 | ) | (2,301 | ) | (6,730 | ) | (7,230 | ) | ||||||||
| Adjusted Net Income | $ | 20,008 | $ | 20,566 | $ | 115,959 | $ | 97,219 | ||||||||
| Reconciliation to Adjusted Diluted Earnings per Share | ||||||||||||||||
| Diluted Earnings per Share | $ | 0.01 | $ | (0.01 | ) | $ | 0.20 | $ | 0.09 | |||||||
| Remove adjusting items(1) | 0.02 | 0.04 | 0.11 | 0.13 | ||||||||||||
| Remove amortization expense | 0.08 | 0.08 | 0.31 | 0.31 | ||||||||||||
| Remove tax benefit on adjusting items and amortization expense(2) | (0.01 | ) | (0.01 | ) | (0.03 | ) | (0.04 | ) | ||||||||
| Adjusted Diluted Earnings per Share | $ | 0.10 | $ | 0.10 | $ | 0.58 | $ | 0.49 | ||||||||
| Reconciliation to Adjusted Diluted Shares Outstanding | ||||||||||||||||
| Diluted Shares, as reported | 199,552 | 196,689 | 199,480 | 198,915 | ||||||||||||
| Non-GAAP dilution adjustments | ||||||||||||||||
| Dilutive effect of stock options and awards(3) | — | 3,860 | — | — | ||||||||||||
| Adjusted Diluted Shares | 199,552 | 200,549 | 199,480 | 198,915 | ||||||||||||
| Note: Adjusted EPS may not add due to rounding. | |||
| (1) | Please refer to "Reconciliation of Adjusted EBITDA" table above for additional information on adjusting items. See "Per share impact of Adjusting Items" table below for the per share impact of each adjustment | ||
| (2) | We have calculated the income tax effect of the non-GAAP adjustments shown above at the applicable statutory rate of 25% for the | ||
| a. | The tax impact of stock compensation expense was calculated using the statutory rates above, excluding certain awards that are non-deductible. | ||
| b. | Amortization expense for financial accounting purposes was offset by the tax benefit of deductible amortization expense using the statutory rate of 25%. | ||
| (3) | Diluted shares on a GAAP basis for the thirteen and fifty-two weeks ended | ||
Per Share Impact of Adjusting Items
| Thirteen Weeks Ended | Thirteen Weeks Ended | Fifty-two Weeks Ended | Fifty-two Weeks Ended | |||||||||
| Stock compensation expense | $ | 0.02 | $ | 0.02 | $ | 0.07 | $ | 0.07 | ||||
| Restructuring and other costs | 0.01 | — | 0.02 | 0.01 | ||||||||
| Litigation expense | — | 0.02 | 0.01 | 0.03 | ||||||||
| Acquisition and integration expense | — | — | — | 0.01 | ||||||||
| Change in fair value of contingent consideration | — | — | — | — | ||||||||
| Refinancing charges | — | — | — | 0.02 | ||||||||
| Total adjusting items | $ | 0.02 | $ | 0.04 | $ | 0.11 | $ | 0.13 | ||||
Note: Adjusting items may not tie due to rounding.
Reconciliation of Net Debt
We define Net Debt as reported gross debt less cash on hand. Net debt is not defined under
| Revolving loans | $ | 36,000 | $ | 62,000 | |
| Senior term loan, due 2028 | 636,960 | 645,470 | |||
| Finance leases and other obligations | 20,090 | 11,085 | |||
| Gross debt | $ | 693,050 | $ | 718,555 | |
| Less cash | 27,276 | 44,510 | |||
| Net debt | $ | 665,774 | $ | 674,045 | |
Reconciliation of Free Cash Flow
We calculate free cash flow as cash flows from operating activities less capital expenditures. Free cash flow is not defined under
| Fifty-two Weeks Ended | Fifty-two Weeks Ended | ||||||
| Net cash provided by operating activities | $ | 105,185 | $ | 183,336 | |||
| Capital expenditures | (70,100 | ) | (85,219 | ) | |||
| Free cash flow | $ | 35,085 | $ | 98,117 | |||
Source:
