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Investing.com -- Helios Technologies Inc (NYSE:HLIO) shares surged 8.8% after the motion control and electronic controls technology company reported second-quarter results that exceeded analyst expectations and raised its full-year outlook.
The company posted adjusted earnings per share of $0.59 for the second quarter, beating the analyst estimate of $0.50 by 18%. Revenue came in at $212.5 million, surpassing the consensus estimate of $201.47 million, though still representing a 3% decline YoY. The company also announced plans to divest its CFP unit as part of efforts to simplify its business and focus on core brands.
Helios shares jumped following the announcement as investors responded positively to the company’s improved guidance. For fiscal year 2025, Helios now expects revenue between $810 million and $830 million, up from its previous forecast of $775 million to $825 million and above the analyst consensus of $784 million. The company also raised its full-year adjusted EPS guidance to $2.30-$2.50, significantly higher than the consensus estimate of $1.93.
"The Helios team continued to execute on our financial priorities to drive sequential operating leverage, improve our cash conversion cycle, reduce debt, and strengthen our earnings power to be better positioned to capitalize on improving demand trends," said Sean Bagan, President, CEO and CFO of Helios.
Despite market challenges, the company generated strong cash flow, reducing its debt by 13% compared to the same period last year. The net debt-to-adjusted EBITDA leverage ratio improved to 2.6x from 3.0x a year ago.
The company’s Hydraulics segment saw a 3% sales decline to $140.9 million, while the Electronics segment sales fell 4% to $71.6 million. However, the company noted seven consecutive months of growth in its consolidated order book, suggesting improving market conditions ahead.
Helios also maintained its shareholder returns, paying its 114th consecutive quarterly dividend and repurchasing 200,000 shares for $6.5 million during the quarter.
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