Helios Technologies Reports Mixed Q3 Results Amid Challenging Market Conditions, Sees Profitability Improvement

Helios Technologies, Inc. reported its financial results for the third quarter and the nine months ended September 28, 2024, reflecting a mixed performance amid challenging market conditions. The company’s net sales for the third quarter were $194.5 million, a decrease of 3.4% from $201.4 million in the same period of 2023. Year-to-date net sales also declined by 2.5%, totaling $626.4 million compared to $642.2 million in the prior year. The decline in sales was attributed to lower demand in agriculture, mobile, industrial, and recreational markets, although there was some offset from growth in the health and wellness sector.

Despite the drop in sales, Helios Technologies achieved a significant increase in profitability. The gross profit for the third quarter rose to $60.5 million, up from $59.7 million a year earlier, while operating income surged to $22.2 million, a 60.9% increase from $13.8 million in Q3 2023. Net income for the quarter reached $11.4 million, a substantial increase from $3.5 million in the prior year, resulting in a net income per share of $0.34, compared to $0.11 in Q3 2023.

For the nine-month period, net income slightly increased to $34.2 million from $34.1 million in the previous year, with net income per share remaining stable at $1.03. The company reported a notable improvement in cash flow, with net cash provided by operating activities rising to $86.4 million, up from $50.2 million in the same period of 2023.

Helios Technologies has been active in strategic acquisitions, completing the purchase of Schultes Precision Manufacturing, Inc. in January 2023 and i3 Product Development, Inc. in May 2023. These acquisitions are expected to enhance the company’s capabilities in precision manufacturing and custom engineering services, respectively. The company also reported goodwill from these acquisitions totaling $37.7 million.

In terms of financial position, total assets decreased to $1,571.7 million from $1,590.4 million at the end of 2023, while total liabilities also declined to $686.2 million from $735.8 million. Shareholders' equity increased to $885.5 million, up from $854.6 million, supported by retained earnings rising to $500.8 million.

The company has also undergone restructuring activities, particularly in its Hydraulics segment, establishing new Regional Operational Centers of Excellence and optimizing operations in Europe. These efforts are expected to enhance efficiency and align production with market demands.

Overall, while Helios Technologies faced headwinds in sales, its profitability metrics improved significantly, supported by strategic acquisitions and operational efficiencies.