Slide 1: First Quarter 2020 Earnings
First Quarter 2020 Earnings May 5, 2020 Tricia L. Fulton Interim President & CEO Chief Financial Officer www.heliostechnologies.com © 2020 Helios Technologies 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation and oral statements made by management in connection herewith that are not historical facts are “forward‐looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. Forward‐looking statements involve risks and uncertainties, a
Slide 3: Q1 2020 Financial Results Highlights
Q1 2020 Financial Results Highlights ($ in millions, except EPS) $129.5 (12%) ($0.54) NM Sales GAAP EPS(1) 23.5% (20) bps $0.56 (11%) Adjusted EBITDA(2) Non-GAAP Cash EPS(3) (1) Includes $0.99 per share charge for goodwill impairment (after-tax) (2) See supplemental slide for Adjusted EBITDA reconci
Slide 4: Q1 2020 Business Summary
Q1 2020 Business Summary COST MANAGEMENT EFFORTS & PRODUCTION EFFICIENCIES DROVE 160 BASIS POINT GROSS MARGIN EXPANSION CVT ENGINEERING CENTER OF EXCELLENCE NEAR COMPLETION NET DEBT REDUCTION OF $11.1 MILLION EXPANDS ALREADY STRONG LIQUIDITY POSITION NEW ACE™ AND MCx™ INTRODUCTIONS EXPAND ABILITY TO
Slide 5: 2020 Helios Outlook
2020 Helios Outlook • Withdrew 2020 guidance due to the impact of COVID-19 pandemic • Cost containment actions already taken Temporary 20% salary reduction for officers Permanent layoffs and temporary salary reductions at Enovation Controls A hiring freeze Reduction in the use of contingent
Slide 6: Q1 – Consolidated Results
Q1 – Consolidated Results Sales Adjusted EBITDA Margin(1) GAAP EPS(2) Non-GAAP Cash EPS(3) ($ in millions) $146.9 $0.51 $129.5 2019 23.7% 23.5% $0.63 $1.23 $0.56 2020 2019 2020 2019 2020 2019 2020 $(0.54) (1) See supplemental slide for Adjusted EBITDA reconciliation and other important disclaimers r
Slide 7: Q1 – Hydraulics Segment
Q1 – Hydraulics Segment ($ in millions) First Quarter Highlights Sales Gross Margin Operating Margin Drivers of Sales Decline Softer end market demand and reduced order taking $116.5 38.2% 20.7% 20.4% Unfavorable impact of approximately $5 million $103.8 36.6% due to facility closures and regula
Slide 8: Q1 – Electronics Segment
Q1 – Electronics Segment ($ in millions) First Quarter Highlights Sales Gross Margin Operating Margin Drivers of Sales Decline Softer demand in recreational and oil & gas markets $30.4 47.5% 21.4% 180 bps Gross Margin Improvement $25.7 18.7% Continued cost management efforts 45.7% Non-recurrin
Slide 9: Cash Flow and Capitalization Review
Cash Flow and Capitalization Review ($ in millions) Q1 2019 Q1 2020 Cash Flow Review $19.8 $8.8 Improved free cash flow benefited from reduction in $15.1 $2.9 capital expenditures $12.2 $11.0 Re-evaluated 2020 CapEx and only proceeding with high priority and critical projects Net Cash from Cap E
Slide 10: Vision 2025
Vision 2025 ACHIEVE GLOBAL technology leadership IN THE INDUSTRIAL GOODS SECTOR by 2025 WITH CRITICAL MASS EXCEEDING $1B in sales WHILE MAINTAINING superior profitability & financial strength. DESIGNER AND MANUFACTURER OF INTELLIGENT SYSTEMS & CONTROLS www.heliostechnologies.com © 2020 Helios Techno
Slide 11: Supplemental Information
Supplemental Information www.heliostechnologies.com www.heliostechnologies.com © 2020 © 2020 Helios Technologies Helios Technologies 11
Slide 12: Segment Data
Segment Data ($ in thousands) Three Months Ended Ma rch 28, Ma rch 30, 2020 2019 Sales: Hydraulics $ 103,818 $ 116,463 Electronics 25,665 30,388 Consolidated $ 129,483 $ 146,851 Gross profit and margin: Hydraulics $ 39,674 $ 42,634 38.2% 36.6% Electronics 12,176 13,875 47.5% 45.7% Corporate and othe
Slide 13: Sales by Geographic Region & Segment
Sales by Geographic Region & Segment (Unaudited) 2 0 2 0 Sales by Geographic Region and Segment 2 0 1 9 Sales by Geographic Region and Segment ($ in millions) ($ in millions) % % % % % % Q1 of Total Q1 of Total Q2 of Total Q3 of Total Q4 of Total 2019 of Total Americas: Americas: Hydraulics $ 37.3 H
Slide 14: Adjusted Operating Income Reconciliation
Adjusted Operating Income Reconciliation (Unaudited) T hree Months Ended ($ in thousands) Ma rch 28, Ma rch 30, 2020 2019 G A A P opera ti ng ( l os s ) i ncom e $ ( 10,033) $ 25,832 Acquisition-related amortization of intangible assets 4,348 4,460 Acquisition and financing-related expenses 74 11 CE
Slide 15: Non-GAAP Cash Net Income Reconciliation
Non-GAAP Cash Net Income Reconciliation (Unaudited) Three Months Ended ($ in thousands) Ma rch 28, Ma rch 30, 2020 2019 N et ( l os s ) i ncom e $ ( 17,223) $ 16,404 Amortization of intangible assets 4,348 4,460 Acquisition and financing-related expenses 74 11 CEO transition costs 165 - Goodwill imp
Slide 16: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation (Unaudited) Three Months Ended ($ in thousands) Ma rch 28, Ma rch 30, 2020 2019 N et ( l os s ) i ncom e $ ( 17,223) $ 16,404 Interest expense, net 2,951 4,385 Income tax provision 4,208 4,655 Depreciation and amortization 8,376 8,571 EBITDA ( 1,688) 34,015 Acquisition
Slide 17: First Quarter 2020 Earnings
First Quarter 2020 Earnings May 5, 2020 www.heliostechnologies.com © 2020 Helios Technologies 17