Helios Technologies falls after Q3 misses, FY22 outlook lowered

MicroStockHub

Hydraulics and electronics solutions provider Helios Technologies (HLIO) fell ~10% after Q3 results missed consensus and FY22 outlook was lowered.

Q3 non-GAAP EPS of $0.90 misses by $0.07, and revenue of $207.2M (-7.2% Y/Y) misses by $10.92M.

The non-GAAP EPS reflects an estimated $0.05 impact from Hurricane Ian and $0.03 impact from FX compared with prior-year period.

An estimated $5.3M of product was not shipped in the quarter due to Hurricane Ian. Sales included $2.9M in revenue from acquisitions, the company said in its earnings release.

Gross margin was down 280 basis points Y/Y to 33.4%, driven by higher raw material costs and higher energy costs in the EMEA region partially offset by the impact of price increases.

Net income was down 27% on a yearly basis to $20.4M.

Adjusted EBITDA was down 14% to $48.0M.

Cash and cash equivalents at Oct. 1 were $36.8M, down $4.5M from Q2-end and up $8.3M from 2021-end.

The company reduced its FY22 revenue outlook to $885M - $910M from ~$930M. Consensus revenue estimate is $924.50M.

EPS estimate was lowered to $3.85 - $4.05 from ~$4.35. Consensus EPS estimate is $4.29.

"We are cautious given inflation, the decline in consumer spending. China restrictions. The war in Ukraine and FX high inflation may continue to slow the global economy and is also causing a pullback in consumer spending, which is directly impacting the health and wellness market," CFO Tricia Fulton said during the Q3 earnings call.