Hawkins with lower Sales but higher Adjusted EBITDA
United States chemical distributor Hawkins, Inc. (Roseville (Minneapolis), MN, United States) yesterday published results for Q4-FY2020 and Fiscal 2020. Sales for the three months ended on 31.3.2020 were USD 132.4 mn, virtaully flat when compared wth the same period in fiscal 2019 at USD 133.1. Adjusted EBITDA was USD 13.1 mn, an increase of 10.3% compared to the USD 11.9 mn realised in Q4-FY2019.
Sales for the full fiscal year 2020 were 540.2 mn, a decline of 2.9% when compared with the USD 556.3 mn realised in FY2019. Hawkins said the The decrease in sales was driven primarily by lower pricing due to lower costs of one of the major commodities, offset by increased volumes sold of certain manufactured, blended and re-packaged products. Sales in the Industrial segment were USD 275.2 mn, down USD 6.7 mn or 2.4%. Sales in Water Treatment increased USD 10.4 mn or 7% to USD 159.9 mn. Sales in Health and Nutrition decreased by USD 19.9 mn or 15.9% to USD 105.1mn
Gross Profit in FY2020 was USD 100.9 mn (equivalent to 18.7% of sales), an increase of USD 5.0 mn over the USD 95.9 mn or 17.2% of sales in FY2019. Adjusted EBITDA was USD 65.3 mn (12.9% of sales), which compares with USD 60.7 mn or 9.8% of sales achieved in FY2019.
Net Income was USD 28.4 mn or USD 2.66 per diluted share. This compares with a figures of USD 24.4 mn and USD 2.29 for fiscal 2019, respectively.
Hawkins said it has used USD 25 mn from the record operating cash flow of USD 58.9 mn for the full year to pay down debt. The company now has a debt level of USD 55.7 mn, resulting in a leverage ration below 1.0x.
Regarding COVID-19, the company notes that the “pandemic has created tremendous uncertainty in the economy. The financial impact … has been mixed, as sales to certain end-markets such as Food, Bottled Bleach and Health & Nutrition have benefited [certain] reporting segments, while decreased sales to other end-markets such as Ethanol, Pools & Resorts have negatively impacted them. As uncertainty continues with this pandemic, the company expects mixed results to continue for the foreseeable future.”
Source: Hawkins press releases
HGE – DCG / 21.05.2020