Hillman Solutions Corp. ((HLMN)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Hillman Solutions Corp. recently conducted its earnings call, revealing a generally positive sentiment driven by strong financial performance in the second quarter and effective management of tariff-related challenges. The company announced an increase in full-year guidance and a share repurchase program, although it acknowledged challenges such as declining sales in Canada and potential volume declines in the latter half of the year. Overall, the sentiment remains optimistic due to robust execution and a promising outlook despite some hurdles.
Strong Second Quarter Results
Hillman Solutions Corp. reported impressive financial results for the second quarter of 2025, with net sales reaching $402.8 million, marking a 6.2% increase compared to the same period last year. The company also saw a significant rise in adjusted EBITDA, which increased by 10.1% to $75.2 million, and an improvement in adjusted EBITDA margins by 70 basis points to 18.7%.
Successful Tariff Management and Strategic Positioning
The company has successfully navigated tariff-related cost increases and is strategically reducing its reliance on product sourcing from China. By the end of 2025, Hillman aims to decrease its sourcing from China to approximately 20%, a significant reduction from nearly 50% in 2018.
Upgraded Full Year Guidance
Hillman has raised its full-year 2025 net sales guidance to a range of $1.535 billion to $1.575 billion, reflecting a 4% to 7% growth over 2024. Additionally, the adjusted EBITDA guidance has been increased to a range of $265 million to $275 million, representing a 10% to 14% growth over the previous year.
Successful Acquisition and Business Expansion
The acquisition of Intex has contributed a 4-point increase to Hillman’s top-line growth. Furthermore, the Robotics and Digital Solutions (RDS) segment showed a 2.3% increase in net sales, underscoring the success of the MinuteKey 3.5 strategy.
Share Repurchase Program
In a move to enhance shareholder value, Hillman has introduced a $100 million share repurchase program, marking its first such initiative since going public in 2021.
Decline in Canadian Sales
Despite the overall positive performance, Hillman reported a 5.6% decline in net sales in its Canadian business, attributed to soft market volumes and foreign exchange headwinds.
Gross Margin Decline
The second quarter saw a slight decline in adjusted gross margins by 40 basis points to 48.3%, primarily due to the Intex acquisition, which has lower gross margins.
Potential Volume Declines
Looking ahead, Hillman anticipates a potential 9% decline in market volumes in the second half of the year, driven by expected price increases and challenging market conditions.
Forward-Looking Guidance
Hillman Solutions Corp. has increased its full-year guidance, with the midpoint of 2025 net sales now projected at $1.555 billion, reflecting a 4% to 7% growth over 2024. The adjusted EBITDA guidance has also been raised to a midpoint of $270 million, indicating a 10% to 14% growth over the previous year. The company is optimistic about continued growth into 2026, with expectations of net sales increasing in the high single to low double digits and adjusted EBITDA in the low to mid-single digits.
In summary, Hillman Solutions Corp.’s earnings call conveyed a positive outlook, bolstered by strong second-quarter results and strategic initiatives such as tariff management and business expansion. While challenges like declining Canadian sales and potential volume declines remain, the company’s upgraded guidance and share repurchase program reflect confidence in its future performance.