Agreed to
Raises FY 2026 Net Sales and Adj. EBITDA outlook
Second Quarter 2026 Highlights (Thirteen weeks ended
- Net sales increased 9.8% to
$442.3 million compared to$402.8 million in the prior year quarter - Net income increased to
$21.1 million , or$0.11 per diluted share, compared to$15.8 million , or$0.08 per diluted share, in the prior year quarter - Adjusted diluted EPS1 totaled
$0.17 per diluted share, unchanged from the prior year quarter - Adjusted EBITDA1 increased to
$77.1 million compared to$75.2 million in the prior year quarter - Net cash provided by operating activities increased to
$68.5 million compared to$48.1 million in the prior year quarter - Free Cash Flow1 increased to
$70.2 million compared to$31.2 million in the prior year quarter - Repurchased approximately 1.7 million shares of its common stock at an average price of
$7.62 per share, which totaled$13.3 million - Subsequent to the quarter end, successfully closed the refinancing of its existing credit facilities, consisting of a new
$735 million senior secured Term Loan B and a$375 million asset-based revolving credit facility - Subsequent to the quarter end, entered into a definitive agreement to acquire
Kanebridge for$315 million , with closing expected around the start of Q4 2026
Balance Sheet and Liquidity at
- Gross debt was
$701.3 million compared to$693.1 million onDecember 27, 2025 - Net debt1 was
$665.4 million compared to$665.8 million onDecember 27, 2025 - Liquidity available totaled
$331.3 million ; consisting of$295.5 million of available borrowing under the revolving credit facility and$35.8 million of cash and equivalents - Net debt1 to trailing twelve month Adjusted EBITDA was 2.4x at quarter end unchanged from 2.4x on
December 27, 2025
Management Commentary
"Hillman delivered a strong second quarter, with robust free cash flow and top line growth of 10%, which is in line with our long-term growth targets," commented
"Given our continued execution and the expected contribution from the
"We continue to execute our Blueprint for strategic growth.
Full Year 2026 Guidance - Updated
Based on year-to-date performance and its expectations for the remainder of the year, management updated its guidance most recently provided on
| Previous FY 2026 Guidance | Updated FY 2026 Guidance | |
| Adjusted EBITDA1 | ||
| Free Cash Flow1 | ||
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.
Second Quarter 2026 Results Presentation
Hillman plans to host a conference call and webcast presentation on
Date:
Time:
Listen-Only Webcast: https://edge.media-server.com/mmc/p/8mb5xri2
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
About
Founded in 1964 and headquartered in
Forward-Looking Statements
All statements made in this press release that are considered 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 and statements relating to the
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 – Corporate Development, 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 | Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||||||||
| Net sales | $ | 442,251 | $ | 402,803 | $ | 812,324 | $ | 762,146 | ||||||||
| Cost of sales (exclusive of depreciation and amortization shown separately below) | 234,162 | 208,338 | 435,658 | 399,078 | ||||||||||||
| Selling, warehouse, general and administrative expenses | 133,983 | 123,707 | 258,554 | 242,759 | ||||||||||||
| Depreciation | 22,535 | 19,848 | 44,534 | 39,243 | ||||||||||||
| Amortization | 15,223 | 15,257 | 30,499 | 30,672 | ||||||||||||
| Other income, net | (4,585 | ) | (664 | ) | (5,068 | ) | (938 | ) | ||||||||
| Income from operations | 40,933 | 36,317 | 48,147 | 51,332 | ||||||||||||
| Interest expense, net | 13,042 | 13,892 | 26,047 | 28,352 | ||||||||||||
| Refinancing costs | — | — | — | 906 | ||||||||||||
| Income before income taxes | 27,891 | 22,425 | 22,100 | 22,074 | ||||||||||||
| Income tax expense | 6,771 | 6,593 | 5,712 | 6,559 | ||||||||||||
| Net income | $ | 21,120 | $ | 15,832 | $ | 16,388 | $ | 15,515 | ||||||||
| Basic and diluted income per share | $ | 0.11 | $ | 0.08 | $ | 0.08 | $ | 0.08 | ||||||||
| Weighted average basic and diluted shares outstanding | 195,881 | 197,593 | 196,254 | 197,439 | ||||||||||||
| Diluted income per share | $ | 0.11 | $ | 0.08 | $ | 0.08 | $ | 0.08 | ||||||||
| Weighted average diluted shares outstanding | 196,891 | 198,676 | 197,993 | 199,257 | ||||||||||||
Condensed Consolidated Balance Sheets
(dollars in thousands)
Unaudited
2025 | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 35,839 | $ | 27,276 | ||||
| Accounts receivable, net of allowances of | 154,694 | 114,926 | ||||||
| Inventories, net | 455,085 | 485,938 | ||||||
| Other current assets | 24,152 | 18,342 | ||||||
| Total current assets | 669,770 | 646,482 | ||||||
| Property and equipment, net of accumulated depreciation of | 228,637 | 231,482 | ||||||
| 829,833 | 830,747 | |||||||
| Other intangibles, net of accumulated amortization of | 515,187 | 546,171 | ||||||
| Operating lease right of use assets | 101,219 | 75,152 | ||||||
| Other assets | 31,532 | 26,160 | ||||||
| Total assets | $ | 2,376,178 | $ | 2,356,194 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 131,510 | $ | 141,662 | ||||
| Current portion of debt and financing lease liabilities | 15,252 | 14,830 | ||||||
| Current portion of operating lease liabilities | 20,884 | 17,947 | ||||||
| Accrued expenses: | ||||||||
| Salaries and wages | 15,610 | 35,790 | ||||||
| Pricing allowances | 11,980 | 8,098 | ||||||
| Income and other taxes | 9,899 | 9,466 | ||||||
| Other accrued liabilities | 41,706 | 29,766 | ||||||
| Total current liabilities | 246,841 | 257,559 | ||||||
| Long-term debt | 678,112 | 668,337 | ||||||
| Deferred tax liabilities | 132,938 | 131,870 | ||||||
| Operating lease liabilities | 86,771 | 63,459 | ||||||
| Other non-current liabilities | 6,309 | 6,462 | ||||||
| Total liabilities | $ | 1,150,971 | $ | 1,127,687 | ||||
| Commitments and contingencies (Note 6) | ||||||||
| Stockholders' equity: | ||||||||
| Common stock: | 20 | 20 | ||||||
| (35,823 | ) | (12,423 | ) | |||||
| Additional paid-in capital | 1,463,264 | 1,457,422 | ||||||
| Accumulated deficit | (162,258 | ) | (178,646 | ) | ||||
| Accumulated other comprehensive loss | (39,996 | ) | (37,866 | ) | ||||
| Total stockholders' equity | 1,225,207 | 1,228,507 | ||||||
| Total liabilities and stockholders' equity | $ | 2,376,178 | $ | 2,356,194 | ||||
Condensed Consolidated Statement of Cash Flows
(dollars in thousands)
Unaudited
| Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 16,388 | $ | 15,515 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 75,033 | 69,915 | ||||||
| Deferred income taxes | (467 | ) | (3,101 | ) | ||||
| Deferred financing and original issue discount amortization | 2,506 | 2,511 | ||||||
| Stock-based compensation expense | 7,362 | 6,835 | ||||||
| Loss on debt restructuring | — | 906 | ||||||
| Cash paid to third parties in connection with debt restructuring | — | (906 | ) | |||||
| Gain on acquisition, net of tax | (4,721 | ) | — | |||||
| Gain on disposal of property and equipment | (77 | ) | (63 | ) | ||||
| Change in fair value of contingent consideration | (352 | ) | (567 | ) | ||||
| Changes in operating items: | ||||||||
| Accounts receivable, net | (31,935 | ) | (30,905 | ) | ||||
| Inventories, net | 41,804 | (20,812 | ) | |||||
| Other assets | (11,349 | ) | (7,702 | ) | ||||
| Accounts payable | (13,395 | ) | 29,015 | |||||
| Accrued salaries and wages | (20,134 | ) | (10,681 | ) | ||||
| Other accrued expenses | 7,800 | (1,908 | ) | |||||
| Net cash provided by operating activities | 68,463 | 48,052 | ||||||
| Net cash from investing activities | ||||||||
| Acquisition of business, net of cash received | (7,218 | ) | — | |||||
| Capital expenditures | (32,595 | ) | (38,175 | ) | ||||
| Other investing activities | (96 | ) | (109 | ) | ||||
| Net cash used for investing activities | (39,909 | ) | (38,284 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Repayments of senior term loans | (4,255 | ) | (4,256 | ) | ||||
| Borrowings on revolving credit loans | 105,645 | 79,000 | ||||||
| Repayments of revolving credit loans | (95,617 | ) | (92,000 | ) | ||||
| Principal payments under finance lease obligations | (3,193 | ) | (2,653 | ) | ||||
| Proceeds from exercise of stock options | 1,483 | 490 | ||||||
| Repurchases of common stock | (23,400 | ) | — | |||||
| Payments of contingent consideration | (141 | ) | (137 | ) | ||||
| Other financing activities | (477 | ) | (855 | ) | ||||
| Net cash used for financing activities | (19,955 | ) | (20,411 | ) | ||||
| Effect of exchange rate changes on cash | (36 | ) | 321 | |||||
| Net increase (decrease) in cash and cash equivalents | 8,563 | (10,322 | ) | |||||
| Cash and cash equivalents at beginning of period | 27,276 | 44,510 | ||||||
| Cash and cash equivalents at end of period | $ | 35,839 | $ | 34,188 | ||||
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 use this financial measure to evaluate our consolidated operating performance and the operating performance of our operating segments as well as 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 | Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||||||||
| Net income | $ | 21,120 | $ | 15,832 | $ | 16,388 | $ | 15,515 | ||||||||
| Income tax benefit | 6,771 | 6,593 | 5,712 | 6,559 | ||||||||||||
| Interest expense, net | 13,042 | 13,892 | 26,047 | 28,352 | ||||||||||||
| Depreciation | 22,535 | 19,848 | 44,534 | 39,243 | ||||||||||||
| Amortization | 15,223 | 15,257 | 30,499 | 30,672 | ||||||||||||
| EBITDA | $ | 78,691 | $ | 71,422 | $ | 123,180 | $ | 120,341 | ||||||||
| Stock compensation expense | 3,355 | 3,557 | 7,362 | 6,835 | ||||||||||||
| Restructuring and other (1) | (577 | ) | 420 | 1,434 | 2,111 | |||||||||||
| Transaction and integration expense (2) | (4,481 | ) | 70 | (4,389 | ) | 128 | ||||||||||
| Change in fair value of contingent consideration | 157 | (241 | ) | (352 | ) | (567 | ) | |||||||||
| Refinancing costs (3) | — | — | — | 906 | ||||||||||||
| Total adjusting items | (1,546 | ) | 3,806 | 4,055 | 9,413 | |||||||||||
| Adjusted EBITDA | $ | 77,145 | $ | 75,228 | $ | 127,235 | $ | 129,754 | ||||||||
| (1) | Includes consulting and other costs associated with severance related to our distribution center relocations and corporate restructuring activities. |
| (2) | Transaction and integration expense includes professional fees and other costs related to acquisition activity, including the acquisitions of |
| (3) | In the first quarter of 2025, we entered into a Repricing Amendment on our existing Senior Term Loan due |
Reconciliation of Adjusted Diluted Earnings Per Share
(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 | Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||||||||
| Reconciliation to Adjusted Net Income | ||||||||||||||||
| Net Income | $ | 21,120 | $ | 15,832 | $ | 16,388 | $ | 15,515 | ||||||||
| Remove adjusting items (1) | (1,546 | ) | 3,806 | 4,055 | 9,413 | |||||||||||
| Remove amortization expense | 15,223 | 15,257 | 30,499 | 30,672 | ||||||||||||
| Remove tax benefit on adjusting items and amortization expense (2) | (1,101 | ) | (1,176 | ) | (2,607 | ) | (2,896 | ) | ||||||||
| Adjusted Net Income | $ | 33,696 | $ | 33,719 | $ | 48,335 | $ | 52,704 | ||||||||
| Reconciliation to Adjusted Diluted Earnings per Share | ||||||||||||||||
| Diluted Earnings per Share | $ | 0.11 | $ | 0.08 | $ | 0.08 | $ | 0.08 | ||||||||
| Remove adjusting items (1) | (0.01 | ) | 0.02 | 0.02 | 0.05 | |||||||||||
| Remove amortization expense | 0.08 | 0.08 | 0.15 | 0.15 | ||||||||||||
| Remove tax benefit on adjusting items and amortization expense (2) | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | ||||||||
| Adjusted Diluted Earnings per Share | $ | 0.17 | $ | 0.17 | $ | 0.24 | $ | 0.26 | ||||||||
| Diluted Shares, as reported | 196,891 | 198,676 | 197,993 | 199,257 | ||||||||||||
| Note: Adjusted EPS may not add due to rounding. | |||
| (1) | Please refer to the "Reconciliation of Adjusted EBITDA" table above for additional information on adjusting items. See the "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%. | ||
Per Share Impact of Adjusting Items
| Thirteen Weeks Ended | Thirteen Weeks Ended | Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||||||
| Stock compensation expense | $ | 0.02 | $ | 0.02 | $ | 0.04 | $ | 0.03 | ||||||
| Restructuring and other costs | 0.00 | 0.00 | 0.01 | 0.01 | ||||||||||
| Transaction and integration expense | (0.02 | ) | 0.00 | (0.02 | ) | 0.00 | ||||||||
| Change in fair value of contingent consideration | 0.00 | 0.00 | 0.00 | 0.00 | ||||||||||
| Refinancing costs | 0.00 | 0.00 | 0.00 | 0.00 | ||||||||||
| Total adjusting items | $ | (0.01 | ) | $ | 0.02 | $ | 0.02 | $ | 0.05 | |||||
| Note: Adjusting items may not add 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 | $ | 46,000 | $ | 36,000 | ||
| Senior term loan, due 2028 | 632,705 | 636,960 | ||||
| Finance leases and other obligations | 22,561 | 20,090 | ||||
| Gross debt | $ | 701,266 | $ | 693,050 | ||
| Less cash | 35,839 | 27,276 | ||||
| Net debt | $ | 665,427 | $ | 665,774 | ||
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
| Thirteen Weeks Ended | Thirteen Weeks Ended | Twenty-six Weeks Ended | Twenty-six Weeks Ended | |||||||||||||
| Net cash provided by operating activities | $ | 87,996 | $ | 48,707 | $ | 68,463 | $ | 48,052 | ||||||||
| Capital expenditures | (17,780 | ) | (17,517 | ) | (32,595 | ) | (38,175 | ) | ||||||||
| Free cash flow | $ | 70,216 | $ | 31,190 | $ | 35,868 | $ | 9,877 | ||||||||
Source:
