Hawkins, Inc. Reports 8% Sales Growth in Q3, Driven by Water Treatment Segment

Hawkins, Inc. reported a notable increase in financial performance for the three and nine months ended December 29, 2024, compared to the same periods in the previous fiscal year. The company achieved sales of $226.2 million for the third quarter, marking an 8% increase from $208.5 million in the prior year. For the nine-month period, sales rose by 5% to $729.1 million, up from $696.1 million. Net income for the third quarter was $15.0 million, slightly higher than $14.9 million a year earlier, while net income for the nine months increased to $68.0 million from $61.5 million. The basic earnings per share remained stable at $0.72 for the third quarter, with a year-to-date figure of $3.27, up from $2.95.

The company experienced significant changes in its operational segments, particularly in the Water Treatment segment, which saw a 22% increase in sales to $99.8 million, driven by contributions from recent acquisitions and increased sales volumes. Conversely, the Industrial segment reported a slight decline in sales, down 1% to $92.0 million, attributed to lower selling prices and competitive pressures. The Health and Nutrition segment also saw a modest increase of 3% in sales, reaching $34.5 million. Overall, gross profit for the third quarter increased by 15% to $48.4 million, reflecting improved margins across segments.

Hawkins, Inc. has been active in expanding its business through acquisitions, completing several significant transactions in the past year. Notably, the company acquired Waterguard, Inc. for $18.0 million, Wofford Water Service, Inc. for $3.4 million, and Intercoastal Trading, Inc. for $22.0 million, among others. These acquisitions are expected to enhance Hawkins' capabilities in the water treatment chemicals market and contribute to future revenue growth. The total annual revenue from these acquired businesses is estimated at approximately $105 million.

Operationally, Hawkins reported a decrease in cash provided by operating activities to $80.3 million for the nine months ended December 29, 2024, down from $117.6 million in the prior year, primarily due to unfavorable changes in inventory and receivables. The company’s cash balance increased to $8.3 million, up from $7.2 million at the end of the previous fiscal year. Hawkins also maintained a share repurchase program, having repurchased 105,541 shares at a total cost of $9.1 million during the nine-month period.

Looking ahead, Hawkins, Inc. anticipates continued growth driven by its strategic acquisitions and operational efficiencies. The company expects to leverage its expanded product offerings and customer base to enhance profitability. Management remains optimistic about the future, projecting that cash flows from operations, along with available credit facilities, will be sufficient to meet ongoing operational needs and support further growth initiatives.