Hillenbrand (HI) Q2 2025 earnings summary

Executive summary

• Completed divestiture of majority stake in Milacron, resulting in a $54.6M pre-tax loss and a shift to a 48.74% minority stake, with $265M in net proceeds used for debt reduction and a strategic focus on higher-margin, less cyclical businesses.

• Q2 2025 revenue was $716M, down 9% year-over-year, with a GAAP net loss of $41M (EPS $(0.58)), primarily due to the Milacron sale.

• Adjusted EPS was $0.60, down 21% year-over-year, reflecting lower APS volume and cost inflation, partially offset by favorable pricing.

• Operational execution exceeded expectations despite macroeconomic and tariff headwinds, with order activity improving in food, health, and nutrition markets, but overall backlog and orders declined.

• Cost synergy and integration initiatives remain on track, targeting $30M annual run-rate synergies by FY26.

Financial highlights

• Q2 2025 revenue was $716M, down 9% year-over-year; adjusted EBITDA was $98.8M, down 19%; adjusted EBITDA margin was 13.8%, down 180 bps.

• GAAP net loss of $41M, compared to net income of $6.1M prior year, due to non-cash loss on Milacron sale.

• Operating cash flow was $1M; capital expenditures were $9M; $16M paid in dividends.

• Total backlog at quarter-end was $1.6B, down 14–15% year-over-year.

• Cash and cash equivalents at quarter-end were $458M; liquidity stood at $770M.

Outlook and guidance

• FY25 revenue guidance: $2.56–$2.62B; adjusted EBITDA: $363–$395M; adjusted EPS: $2.10–$2.45, reflecting persistent macro headwinds and $15M in direct tariff costs.

• Q3 revenue expected at $569–$583M; adjusted EPS $0.46–$0.53.

• Full-year operating cash flow expected at $120M; CapEx at $40M.

• After-tax cash proceeds of ~$100M expected from the pending sale of TerraSource, anticipated to close in late Q3 or early Q4 2025.

• Guidance assumes continued soft demand and no near-term recovery in order patterns.