Helios Technologies (HLIO) Q1 2025 earnings summary

Executive summary

• Q1 2025 net sales were $195.5M, down 8% year-over-year but up 9% sequentially, exceeding guidance and internal estimates; Hydraulics declined 11% and Electronics were nearly flat.

• Adjusted EBITDA margin was 17.3%, with cash from operations up 7% year-over-year to $19.0M; net income was $7.3M, down 21% year-over-year.

• Management is focused on customer-centric go-to-market initiatives, operational efficiency, and innovation, with ongoing restructuring and leadership transitions.

• Early wins in new business, product launches, and positive order intake trends are supporting growth despite challenging markets.

• Debt reduced for seven consecutive quarters, with net debt to adjusted EBITDA improved to 2.7x from 3.1x year-over-year.

Financial highlights

• Net sales: $195.5M, down 8% year-over-year but $5M above high end of outlook; FX impact was -$2.3M.

• Adjusted EBITDA margin: 17.3% (down 90 bps YoY); operating margin: 8.7%; adjusted operating margin: 13.4%.

• Diluted EPS: $0.22, down 21% year-over-year; non-GAAP EPS: $0.44, down 17% year-over-year but up 33% sequentially.

• Cash from operations: $19.0M, up 7% year-over-year; inventory reduced by 11%; capital expenditures: $6.1M (3% of sales).

• Net debt to adjusted EBITDA at 2.7x; free cash flow conversion rate: 258% (trailing 12 months).

Outlook and guidance

• Q2 2025 net sales expected at $198M–$206M, up 1–5% sequentially; adjusted EBITDA margin projected at 17.5–18.5%.

• Non-GAAP EPS for Q2 expected at $0.46–$0.54, up 5–23% sequentially.

• Full-year outlook not withdrawn, but guidance now focused on next quarter due to tariff and demand uncertainties.

• Electronics segment sales expected to outpace Hydraulics; gross margin expected to expand sequentially.

• Capital expenditures for 2025 forecasted at 3–4% of sales.