Helios Technologies (HLIO) CJS Securities 26th Annual "New Ideas for the New Year” Investor Conference summary

Company Overview, Strategy, and Transformation

• Focuses on highly engineered hydraulics and electronic solutions for diverse markets, emphasizing quality, safety, and rugged environments.

• Growth driven by diversification, product innovation, acquisitions since 2016, and recent divestitures to streamline the portfolio.

• Leadership changes and talent development have supported strategic reviews, operational improvements, and future growth.

• Maintains a strong financial profile with a market cap of $2.1 billion and ample liquidity.

• Commitment to shareholder returns, with over 28 years of consecutive quarterly dividends and a share repurchase program.

Financial Performance, Capital Allocation, and Outlook

• Achieved annual sales of $825 million, with adjusted EBITDA margin for 2025E projected at 19.3%.

• Net debt to adjusted EBITDA improved to 2.4x by 3Q25, with over $400 million in liquidity and $419 million total debt.

• Adjusted free cash flow conversion was 223% for TTM 3Q25, with strong cash flow generation and disciplined working capital management.

• Initiated a share repurchase program in 2025, buying back over 300,000 shares year-to-date and 50,000 shares in 3Q25.

• Capital allocation priorities include debt reduction, organic investment, shareholder returns, and strategic acquisitions.

Business Segments, Market Positioning, and Performance

• Operates two main segments: Hydraulics (65% of sales) and Electronics (35% of sales), with flagship brands and global reach.

• Hydraulics segment serves mobile, agriculture, industrial, and recreational markets, generating $528M in TTM 3Q25 sales.

• Electronics segment focuses on health & wellness, industrial, and recreational markets, with $279M in TTM 3Q25 sales.

• Geographic sales mix is balanced: 54% Americas, 23% EMEA, 23% APAC, with a global manufacturing and employee footprint.

• Mobile, recreational, and agriculture markets showed year-over-year growth in Q3, with hydraulics up 9% and electronics up 21%.