Hawkins (HWKN) Q2 2026 earnings summary

Executive summary

• Sales for the quarter ended September 28, 2025, rose 14% year-over-year to a record $280.4 million, with all segments contributing to growth for the second consecutive quarter.

• Adjusted EBITDA reached $50.4 million, a 9% increase year-over-year, and trailing 12-month adjusted EBITDA exceeded $178 million.

• Net income for the quarter was $22.6 million, down from $24.1 million in the prior year, primarily due to higher SG&A, amortization, and interest expenses from acquisitions.

• Major acquisitions, including WaterSurplus for $149.9 million, drove significant revenue and asset growth.

Financial highlights

• Gross profit increased 12% year-over-year to $67.6 million, maintaining a 24% gross margin.

• Operating income was $33.9 million, up 1% from the prior year.

• SG&A expenses rose 27% to $33.7 million, driven by acquisition-related costs and higher personnel expenses.

• Diluted EPS for the quarter was $1.08, down 7% from the prior year.

• Cash from operations for the six months was $71.0 million, up from $59.2 million year-over-year.

Outlook and guidance

• Management expects the effective tax rate for the full year to be approximately 26% to 27%.

• Water Treatment and Industrial Solutions segments are expected to continue growing in the second half, while Food & Health Sciences is projected to be flat or down due to tougher comparisons and competitive pressures.

• The WaterSurplus acquisition is expected to be accretive in fiscal 2027, with $17 million in annualized acquisition-related expenses anticipated for fiscal 2026.

• Cash balances, credit facility, and operating cash flows are expected to be sufficient for ongoing operations.