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FORM 10-Q
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HAWKINS, INC.
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(Exact name of registrant as specified in its charter)
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Minnesota
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41-0771293
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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2381 Rosegate, Roseville, Minnesota
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55113
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(Address of principal executive offices)
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(Zip code)
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(612) 331-6910
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(Registrant’s telephone number, including area code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $.05 per share
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HWKN
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Nasdaq Stock Market LLC
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Large accelerated filer
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¨
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Accelerated filer
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ý
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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CLASS
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Shares Outstanding at October 25, 2019
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Common Stock, par value $.05 per share
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10,628,976
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Page
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PART I.
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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September 29,
2019 |
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March 31,
2019 |
||||
ASSETS
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||||
CURRENT ASSETS:
|
|
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|
|
||||
Cash and cash equivalents
|
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$
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4,056
|
|
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$
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9,199
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Trade receivables — less allowance for doubtful accounts:
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$909 as of September 29, 2019 and $620 as of March 31, 2019
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65,396
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63,966
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Inventories
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60,804
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60,482
|
|
||
Income taxes receivable
|
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—
|
|
|
527
|
|
||
Prepaid expenses and other current assets
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2,848
|
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5,235
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Total current assets
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133,104
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139,409
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|
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PROPERTY, PLANT, AND EQUIPMENT:
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257,996
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244,861
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Less accumulated depreciation
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133,578
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126,233
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Net property, plant, and equipment
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124,418
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118,628
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OTHER ASSETS:
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Right-of-use assets
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9,529
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—
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Goodwill
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58,440
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58,440
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Intangible assets, net
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63,189
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65,726
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|
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Other
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4,362
|
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3,396
|
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Total other assets
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135,520
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127,562
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Total assets
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$
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393,042
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$
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385,599
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LIABILITIES AND SHAREHOLDERS’ EQUITY
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CURRENT LIABILITIES:
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Accounts payable — trade
|
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$
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29,624
|
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$
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29,314
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Accrued payroll and employee benefits
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8,862
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12,483
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Income tax payable
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735
|
|
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—
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Current portion of long-term debt
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9,907
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9,907
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||
Short-term lease liability
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1,664
|
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—
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Container deposits
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1,352
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1,299
|
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Other current liabilities
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1,709
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2,393
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||
Total current liabilities
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53,853
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55,396
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LONG-TERM DEBT, LESS CURRENT PORTION
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64,705
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74,658
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LONG-TERM LEASE LIABILITY
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7,873
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—
|
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PENSION WITHDRAWAL LIABILITY
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5,148
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5,316
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DEFERRED INCOME TAXES
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26,581
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26,673
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OTHER LONG-TERM LIABILITIES
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5,447
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5,695
|
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Total liabilities
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163,607
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167,738
|
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COMMITMENTS AND CONTINGENCIES
|
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—
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—
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SHAREHOLDERS’ EQUITY:
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|
||||
Common stock; authorized: 30,000,000 shares of $0.05 par value; 10,546,453 and 10,592,450 shares issued and outstanding as of September 29, 2019 and March 31, 2019, respectively
|
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527
|
|
|
530
|
|
||
Additional paid-in capital
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50,282
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52,609
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Retained earnings
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178,557
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164,405
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Accumulated other comprehensive income
|
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69
|
|
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317
|
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||
Total shareholders’ equity
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229,435
|
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217,861
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Total liabilities and shareholders’ equity
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$
|
393,042
|
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$
|
385,599
|
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Three Months Ended
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Six Months Ended
|
||||||||||||
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September 29,
2019 |
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September 30,
2018 |
|
September 29,
2019 |
|
September 30,
2018 |
||||||||
Sales
|
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$
|
140,043
|
|
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$
|
145,324
|
|
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$
|
287,379
|
|
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$
|
295,124
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Cost of sales
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(112,049
|
)
|
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(119,552
|
)
|
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(230,588
|
)
|
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(240,895
|
)
|
||||
Gross profit
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27,994
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25,772
|
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56,791
|
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54,229
|
|
||||
Selling, general and administrative expenses
|
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(14,817
|
)
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(14,941
|
)
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(29,653
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)
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(29,920
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)
|
||||
Operating income
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13,177
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10,831
|
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27,138
|
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24,309
|
|
||||
Interest expense, net
|
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(666
|
)
|
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(811
|
)
|
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(1,429
|
)
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(1,745
|
)
|
||||
Other income
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26
|
|
|
78
|
|
|
143
|
|
|
76
|
|
||||
Income before income taxes
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12,537
|
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10,098
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|
25,852
|
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22,640
|
|
||||
Income tax expense
|
|
(3,287
|
)
|
|
(2,689
|
)
|
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(6,795
|
)
|
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(6,108
|
)
|
||||
Net income
|
|
$
|
9,250
|
|
|
$
|
7,409
|
|
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$
|
19,057
|
|
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$
|
16,532
|
|
|
|
|
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||||||||
Weighted average number of shares outstanding - basic
|
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10,575,538
|
|
|
10,675,833
|
|
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10,589,922
|
|
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10,662,210
|
|
||||
Weighted average number of shares outstanding - diluted
|
|
10,633,117
|
|
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10,719,059
|
|
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10,663,864
|
|
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10,714,381
|
|
||||
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||||||||
Basic earnings per share
|
|
$
|
0.87
|
|
|
$
|
0.69
|
|
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$
|
1.80
|
|
|
$
|
1.55
|
|
Diluted earnings per share
|
|
$
|
0.87
|
|
|
$
|
0.69
|
|
|
$
|
1.79
|
|
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$
|
1.54
|
|
|
|
|
|
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||||||||
Cash dividends declared per common share
|
|
$
|
0.23
|
|
|
$
|
0.225
|
|
|
$
|
0.46
|
|
|
$
|
0.225
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
September 29,
2019 |
|
September 30,
2018 |
|
September 29,
2019 |
|
September 30,
2018 |
||||||||
Net income
|
|
$
|
9,250
|
|
|
$
|
7,409
|
|
|
$
|
19,057
|
|
|
$
|
16,532
|
|
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized (loss) gain on interest rate swap
|
|
(69
|
)
|
|
(15
|
)
|
|
(248
|
)
|
|
12
|
|
||||
Total comprehensive income
|
|
$
|
9,181
|
|
|
$
|
7,394
|
|
|
$
|
18,809
|
|
|
$
|
16,544
|
|
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
Shareholders’ Equity |
|||||||||||||
Shares
|
|
Amount
|
|
||||||||||||||||||||
BALANCE — March 31, 2019
|
|
10,592,450
|
|
|
$
|
530
|
|
|
$
|
52,609
|
|
|
$
|
164,405
|
|
|
$
|
317
|
|
|
$
|
217,861
|
|
Cash dividends paid
|
|
|
|
|
|
|
|
(2,460
|
)
|
|
|
|
(2,460
|
)
|
|||||||||
Share-based compensation expense
|
|
|
|
|
|
509
|
|
|
|
|
|
|
509
|
|
|||||||||
Vesting of restricted stock
|
|
27,620
|
|
|
1
|
|
|
(1
|
)
|
|
|
|
|
|
—
|
|
|||||||
Shares surrendered for payroll taxes
|
|
(9,160
|
)
|
|
(1
|
)
|
|
(342
|
)
|
|
|
|
|
|
(343
|
)
|
|||||||
Shares repurchased
|
|
(47,136
|
)
|
|
(2
|
)
|
|
(1,801
|
)
|
|
|
|
|
|
(1,803
|
)
|
|||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
(179
|
)
|
|
(179
|
)
|
||||||
Net income
|
|
|
|
|
|
|
|
|
|
|
9,807
|
|
|
|
|
9,807
|
|
||||||
BALANCE — June 30, 2019
|
|
10,563,774
|
|
|
$
|
528
|
|
|
$
|
50,974
|
|
|
$
|
171,752
|
|
|
$
|
138
|
|
|
$
|
223,392
|
|
Cash dividends paid
|
|
|
|
|
|
|
|
(2,445
|
)
|
|
|
|
(2,445
|
)
|
|||||||||
Share-based compensation expense
|
|
|
|
|
|
636
|
|
|
|
|
|
|
636
|
|
|||||||||
Vesting of restricted stock
|
|
8,352
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|||||||
ESPP shares issued
|
|
18,586
|
|
|
1
|
|
|
660
|
|
|
|
|
|
|
661
|
|
|||||||
Shares repurchased
|
|
(44,259
|
)
|
|
(2
|
)
|
|
(1,988
|
)
|
|
|
|
|
|
(1,990
|
)
|
|||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
(69
|
)
|
|
(69
|
)
|
||||||
Net income
|
|
|
|
|
|
|
|
|
|
|
9,250
|
|
|
|
|
9,250
|
|
||||||
BALANCE — September 29, 2019
|
|
10,546,453
|
|
|
$
|
527
|
|
|
$
|
50,282
|
|
|
$
|
178,557
|
|
|
$
|
69
|
|
|
$
|
229,435
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
Shareholders’ Equity |
|||||||||||||
Shares
|
|
Amount
|
|
||||||||||||||||||||
BALANCE — April 1, 2018
|
|
10,631,992
|
|
|
$
|
532
|
|
|
$
|
53,877
|
|
|
$
|
147,242
|
|
|
$
|
596
|
|
|
$
|
202,247
|
|
Share-based compensation expense
|
|
|
|
|
|
470
|
|
|
|
|
|
|
470
|
|
|||||||||
Vesting of restricted stock
|
|
24,567
|
|
|
1
|
|
|
(1
|
)
|
|
|
|
|
|
—
|
|
|||||||
Shares surrendered for payroll taxes
|
|
(8,105
|
)
|
|
—
|
|
|
(265
|
)
|
|
|
|
|
|
(265
|
)
|
|||||||
ESPP shares issued
|
|
22,531
|
|
|
1
|
|
|
676
|
|
|
|
|
|
|
677
|
|
|||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
27
|
|
|
27
|
|
|||||||||
Net income
|
|
|
|
|
|
|
|
9,123
|
|
|
|
|
9,123
|
|
|||||||||
BALANCE — July 1, 2018
|
|
10,670,985
|
|
|
$
|
534
|
|
|
$
|
54,757
|
|
|
$
|
156,365
|
|
|
$
|
623
|
|
|
$
|
212,279
|
|
Cash dividends paid
|
|
|
|
|
|
|
|
(2,412
|
)
|
|
|
|
(2,412
|
)
|
|||||||||
Share-based compensation expense
|
|
|
|
|
|
513
|
|
|
|
|
|
|
513
|
|
|||||||||
Vesting of restricted stock
|
|
8,484
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
(15
|
)
|
|
(15
|
)
|
|||||||||
Net income
|
|
|
|
|
|
|
|
7,409
|
|
|
|
|
7,409
|
|
|||||||||
BALANCE — September 30, 2018
|
|
10,679,469
|
|
|
$
|
534
|
|
|
$
|
55,270
|
|
|
$
|
161,362
|
|
|
$
|
608
|
|
|
$
|
217,774
|
|
|
|
Six Months Ended
|
||||||
|
|
September 29,
2019 |
|
September 30,
2018 |
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
19,057
|
|
|
$
|
16,532
|
|
Reconciliation to cash flows:
|
|
|
|
|
||||
Depreciation and amortization
|
|
10,739
|
|
|
11,005
|
|
||
Operating leases
|
|
106
|
|
|
—
|
|
||
Amortization of debt issuance costs
|
|
47
|
|
|
68
|
|
||
Gain on deferred compensation assets
|
|
(143
|
)
|
|
(76
|
)
|
||
Stock compensation expense
|
|
1,145
|
|
|
984
|
|
||
(Gain) loss from property disposals
|
|
(43
|
)
|
|
68
|
|
||
Changes in operating accounts providing (using) cash:
|
|
|
|
|
||||
Trade receivables
|
|
(1,409
|
)
|
|
(2,891
|
)
|
||
Inventories
|
|
(323
|
)
|
|
(8,035
|
)
|
||
Accounts payable
|
|
238
|
|
|
2,372
|
|
||
Accrued liabilities
|
|
(4,504
|
)
|
|
316
|
|
||
Income taxes
|
|
1,262
|
|
|
3,351
|
|
||
Other
|
|
944
|
|
|
1,161
|
|
||
Net cash provided by operating activities
|
|
27,116
|
|
|
24,855
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Purchases of property, plant, and equipment
|
|
(14,088
|
)
|
|
(4,211
|
)
|
||
Other
|
|
209
|
|
|
109
|
|
||
Net cash used in investing activities
|
|
(13,879
|
)
|
|
(4,102
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Cash dividends paid
|
|
(4,905
|
)
|
|
(7,116
|
)
|
||
New shares issued
|
|
661
|
|
|
677
|
|
||
Shares surrendered for payroll taxes
|
|
(343
|
)
|
|
(265
|
)
|
||
Shares repurchased
|
|
(3,793
|
)
|
|
—
|
|
||
Net payments on revolver borrowings
|
|
(10,000
|
)
|
|
(10,000
|
)
|
||
Payments on term loan borrowings
|
|
—
|
|
|
(5,000
|
)
|
||
Net cash used in financing activities
|
|
(18,380
|
)
|
|
(21,704
|
)
|
||
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
|
(5,143
|
)
|
|
(951
|
)
|
||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
|
9,199
|
|
|
4,990
|
|
||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
|
$
|
4,056
|
|
|
$
|
4,039
|
|
|
|
|
|
|
||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
|
|
|
|
|
||||
Cash paid for income taxes
|
|
$
|
5,533
|
|
|
$
|
2,757
|
|
Cash paid for interest
|
|
$
|
1,419
|
|
|
$
|
1,650
|
|
Noncash investing activities - capital expenditures in accounts payable
|
|
$
|
567
|
|
|
$
|
154
|
|
|
Three months ended September 29, 2019
|
||||||||||||||
(In thousands)
|
Industrial
|
|
Water
Treatment |
|
Health and
Nutrition |
|
Total
|
||||||||
Bulk / Distributed specialty products (1)
|
$
|
11,700
|
|
|
$
|
4,971
|
|
|
$
|
22,892
|
|
|
$
|
39,563
|
|
Manufactured, blended or repackaged products (2)
|
55,506
|
|
|
40,487
|
|
|
3,189
|
|
|
99,182
|
|
||||
Other
|
884
|
|
|
410
|
|
|
4
|
|
|
1,298
|
|
||||
Total external customer sales
|
$
|
68,090
|
|
|
$
|
45,868
|
|
|
$
|
26,085
|
|
|
$
|
140,043
|
|
|
|
|
|
|
|
|
|
||||||||
|
Three months ended September 30, 2018
|
||||||||||||||
(In thousands)
|
Industrial
|
|
Water
Treatment |
|
Health and
Nutrition |
|
Total
|
||||||||
Bulk / Distributed specialty products (1)
|
$
|
15,307
|
|
|
$
|
5,982
|
|
|
$
|
29,624
|
|
|
$
|
50,913
|
|
Manufactured, blended or repackaged products (2)
|
53,204
|
|
|
36,305
|
|
|
3,499
|
|
|
93,008
|
|
||||
Other
|
891
|
|
|
426
|
|
|
86
|
|
|
1,403
|
|
||||
Total external customer sales
|
$
|
69,402
|
|
|
$
|
42,713
|
|
|
$
|
33,209
|
|
|
$
|
145,324
|
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended September 29, 2019
|
||||||||||||||
(In thousands)
|
Industrial
|
|
Water
Treatment |
|
Health and
Nutrition |
|
Total
|
||||||||
Bulk / Distributed specialty products (1)
|
$
|
26,790
|
|
|
$
|
9,679
|
|
|
$
|
47,495
|
|
|
$
|
83,964
|
|
Manufactured, blended or repackaged products (2)
|
114,900
|
|
|
78,637
|
|
|
7,333
|
|
|
200,870
|
|
||||
Other
|
1,725
|
|
|
804
|
|
|
16
|
|
|
2,545
|
|
||||
Total external customer sales
|
$
|
143,415
|
|
|
$
|
89,120
|
|
|
$
|
54,844
|
|
|
$
|
287,379
|
|
|
|
|
|
|
|
|
|
||||||||
|
Six months ended September 30, 2018
|
||||||||||||||
(In thousands)
|
Industrial
|
|
Water
Treatment |
|
Health and
Nutrition |
|
Total
|
||||||||
Bulk / Distributed specialty products (1)
|
$
|
30,243
|
|
|
$
|
11,804
|
|
|
$
|
60,301
|
|
|
$
|
102,348
|
|
Manufactured, blended or repackaged products (2)
|
111,236
|
|
|
70,964
|
|
|
7,684
|
|
|
189,884
|
|
||||
Other
|
1,941
|
|
|
814
|
|
|
137
|
|
|
2,892
|
|
||||
Total external customer sales
|
$
|
143,420
|
|
|
$
|
83,582
|
|
|
$
|
68,122
|
|
|
$
|
295,124
|
|
(1)
|
For our Industrial and Water Treatment segments, this line includes our bulk products that we do not modify in any way, but receive, store, and ship from our facilities, or direct ship to our customers in large quantities. For our Health and Nutrition segment, this line includes our non-manufactured distributed specialty products, which may be sold out of one of our facilities or direct shipped to our customers.
|
(2)
|
For our Industrial and Water Treatment segments, this line includes our non-bulk specialty products that we either manufacture, blend, repackage, resell in their original form, or direct ship to our customers in smaller quantities, and services we provide for our
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
September 29,
2019 |
|
September 30,
2018 |
|
September 29,
2019 |
|
September 30,
2018 |
||||
Weighted-average common shares outstanding—basic
|
|
10,575,538
|
|
|
10,675,833
|
|
|
10,589,922
|
|
|
10,662,210
|
|
Dilutive impact of performance units and restricted stock
|
|
57,579
|
|
|
43,226
|
|
|
73,942
|
|
|
52,171
|
|
Weighted-average common shares outstanding—diluted
|
|
10,633,117
|
|
|
10,719,059
|
|
|
10,663,864
|
|
|
10,714,381
|
|
|
|
|
Level 1:
|
|
Quoted prices in active markets for identical assets or liabilities.
|
Level 2:
|
|
Quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for the asset or liability.
|
Level 3:
|
|
Unobservable inputs for the asset or liability that are supported by little or no market activity. These fair values are determined using pricing models for which the assumptions utilize management’s estimates or market participant assumptions.
|
|
|
September 29, 2019
|
|||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||
Interest rate swap
|
|
—
|
|
|
$
|
95
|
|
|
—
|
|
|
Deferred compensation plan assets
|
|
$
|
4,008
|
|
|
—
|
|
|
—
|
|
|
|
March 31, 2019
|
|||||||||
(In thousands)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||
Interest rate swap
|
|
—
|
|
|
$
|
435
|
|
|
—
|
|
|
Deferred compensation plan assets
|
|
$
|
2,637
|
|
|
—
|
|
|
—
|
|
|
|
September 29,
2019 |
|
March 31,
2019 |
||||
(In thousands)
|
|
|
||||||
Inventory (FIFO basis)
|
|
$
|
65,523
|
|
|
$
|
65,526
|
|
LIFO reserve
|
|
(4,719
|
)
|
|
(5,044
|
)
|
||
Net inventory
|
|
$
|
60,804
|
|
|
$
|
60,482
|
|
|
|
September 29, 2019
|
|
March 31, 2019
|
||||||||||||||||||||
(In thousands)
|
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Finite-life intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships
|
|
$
|
78,383
|
|
|
$
|
(19,155
|
)
|
|
$
|
59,228
|
|
|
$
|
78,383
|
|
|
$
|
(16,910
|
)
|
|
$
|
61,473
|
|
Trademarks and trade names
|
|
6,045
|
|
|
(3,378
|
)
|
|
2,667
|
|
|
6,045
|
|
|
(3,115
|
)
|
|
2,930
|
|
||||||
Other finite-life intangible assets
|
|
3,648
|
|
|
(3,581
|
)
|
|
67
|
|
|
3,648
|
|
|
(3,552
|
)
|
|
96
|
|
||||||
Total finite-life intangible assets
|
|
88,076
|
|
|
(26,114
|
)
|
|
61,962
|
|
|
88,076
|
|
|
(23,577
|
)
|
|
64,499
|
|
||||||
Indefinite-life intangible assets
|
|
1,227
|
|
|
—
|
|
|
1,227
|
|
|
1,227
|
|
|
—
|
|
|
1,227
|
|
||||||
Total intangible assets
|
|
$
|
89,303
|
|
|
$
|
(26,114
|
)
|
|
$
|
63,189
|
|
|
$
|
89,303
|
|
|
$
|
(23,577
|
)
|
|
$
|
65,726
|
|
|
|
September 29,
2019 |
|
March 31,
2019 |
||||
|
|
|
||||||
(In thousands)
|
|
|
|
|
||||
Senior secured revolving loan
|
|
$
|
75,000
|
|
|
$
|
85,000
|
|
Less: unamortized debt issuance costs
|
|
(388
|
)
|
|
(435
|
)
|
||
Total debt, net of debt issuance costs
|
|
74,612
|
|
|
84,565
|
|
||
Less: current portion of long-term debt
|
|
(9,907
|
)
|
|
(9,907
|
)
|
||
Total long-term debt
|
|
$
|
64,705
|
|
|
$
|
74,658
|
|
(In thousands)
|
|
September 29, 2019
|
||
Supplemental Cash Flow Information
|
|
|
||
Operating cash flows from leases
|
|
$
|
106
|
|
Lease Term and Discount Rate
|
|
|
||
Weighted average remaining lease term (years)
|
|
9.07
|
|
|
Weighted average discount rate
|
|
4.1
|
%
|
(In thousands)
|
|
Operating Leases
|
||
Remaining fiscal 2020
|
|
$
|
1,921
|
|
Fiscal 2021
|
|
1,472
|
|
|
Fiscal 2022
|
|
1,300
|
|
|
Fiscal 2023
|
|
1,148
|
|
|
Fiscal 2024
|
|
1,117
|
|
|
Thereafter
|
|
4,678
|
|
|
Total
|
|
$
|
11,636
|
|
Less: Interest
|
|
(2,099
|
)
|
|
Present value of lease liabilities
|
|
$
|
9,537
|
|
(In thousands)
|
|
Operating Leases
|
||
Fiscal 2020
|
|
$
|
2,198
|
|
Fiscal 2021
|
|
1,783
|
|
|
Fiscal 2022
|
|
1,407
|
|
|
Fiscal 2023
|
|
1,352
|
|
|
Fiscal 2024
|
|
1,183
|
|
|
Thereafter
|
|
5,473
|
|
|
Total
|
|
$
|
13,396
|
|
|
|
Shares
|
|
Weighted-
Average Grant
Date Fair Value
|
|||
Unvested at beginning of period
|
|
32,883
|
|
|
$
|
43.66
|
|
Granted
|
|
69,252
|
|
|
34.49
|
|
|
Vested
|
|
(27,620
|
)
|
|
46.01
|
|
|
Unvested at end of period
|
|
74,515
|
|
|
$
|
34.27
|
|
(In thousands)
|
|
Industrial
|
|
Water
Treatment
|
|
Health and Nutrition
|
|
Total
|
||||||||
Three months ended September 29, 2019:
|
|
|
|
|
|
|
|
|
||||||||
Sales
|
|
$
|
68,090
|
|
|
$
|
45,868
|
|
|
$
|
26,085
|
|
|
$
|
140,043
|
|
Gross profit
|
|
10,674
|
|
|
12,753
|
|
|
4,567
|
|
|
27,994
|
|
||||
Selling, general, and administrative expenses
|
|
5,895
|
|
|
5,134
|
|
|
3,788
|
|
|
14,817
|
|
||||
Operating income
|
|
4,779
|
|
|
7,619
|
|
|
779
|
|
|
13,177
|
|
||||
Three months ended September 30, 2018:
|
|
|
|
|
|
|
|
|
||||||||
Sales
|
|
$
|
69,402
|
|
|
$
|
42,713
|
|
|
$
|
33,209
|
|
|
$
|
145,324
|
|
Gross profit
|
|
8,328
|
|
|
11,710
|
|
|
5,734
|
|
|
25,772
|
|
||||
Selling, general, and administrative expenses
|
|
5,790
|
|
|
5,055
|
|
|
4,096
|
|
|
14,941
|
|
||||
Operating income
|
|
2,538
|
|
|
6,655
|
|
|
1,638
|
|
|
10,831
|
|
||||
Six months ended September 29, 2019:
|
|
|
|
|
|
|
|
|
||||||||
Sales
|
|
$
|
143,415
|
|
|
$
|
89,120
|
|
|
$
|
54,844
|
|
|
$
|
287,379
|
|
Gross profit
|
|
21,589
|
|
|
24,844
|
|
|
10,358
|
|
|
56,791
|
|
||||
Selling, general and administrative expenses
|
|
11,991
|
|
|
10,122
|
|
|
7,540
|
|
|
29,653
|
|
||||
Operating income
|
|
9,598
|
|
|
14,722
|
|
|
2,818
|
|
|
27,138
|
|
||||
Six months ended September 30, 2018:
|
|
|
|
|
|
|
|
|
||||||||
Sales
|
|
$
|
143,420
|
|
|
$
|
83,582
|
|
|
$
|
68,122
|
|
|
$
|
295,124
|
|
Gross profit
|
|
18,771
|
|
|
23,147
|
|
|
12,311
|
|
|
54,229
|
|
||||
Selling, general and administrative expenses
|
|
11,277
|
|
|
10,156
|
|
|
8,487
|
|
|
29,920
|
|
||||
Operating income
|
|
7,494
|
|
|
12,991
|
|
|
3,824
|
|
|
24,309
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
|
Three months ended
|
|
Six Months Ended
|
||||||||
|
|
September 29, 2019
|
|
September 30, 2018
|
|
September 29, 2019
|
|
September 30, 2018
|
||||
Sales
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
|
(80.0
|
)%
|
|
(82.3
|
)%
|
|
(80.2
|
)%
|
|
(81.6
|
)%
|
Gross profit
|
|
20.0
|
%
|
|
17.7
|
%
|
|
19.8
|
%
|
|
18.4
|
%
|
Selling, general and administrative expenses
|
|
(10.6
|
)%
|
|
(10.3
|
)%
|
|
(10.3
|
)%
|
|
(10.1
|
)%
|
Operating income
|
|
9.4
|
%
|
|
7.4
|
%
|
|
9.5
|
%
|
|
8.3
|
%
|
Interest expense, net
|
|
(0.5
|
)%
|
|
(0.6
|
)%
|
|
(0.5
|
)%
|
|
(0.6
|
)%
|
Other income (expense)
|
|
—
|
%
|
|
0.1
|
%
|
|
—
|
%
|
|
—
|
%
|
Income before income taxes
|
|
8.9
|
%
|
|
6.9
|
%
|
|
9.0
|
%
|
|
7.7
|
%
|
Income tax expense
|
|
(2.3
|
)%
|
|
(1.9
|
)%
|
|
(2.4
|
)%
|
|
(2.1
|
)%
|
Net income
|
|
6.6
|
%
|
|
5.0
|
%
|
|
6.6
|
%
|
|
5.6
|
%
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program
|
|
Maximum Number of Shares that May Yet be Purchased under Plans or Programs
|
|||||
7/1/2019 - 7/28/2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
457,244
|
|
7/29/2019 - 8/25/2019
|
|
44,259
|
|
|
45.00
|
|
|
44,259
|
|
|
412,985
|
|
|
8/26/2019 - 9/29/2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
412,985
|
|
|
Total
|
|
44,259
|
|
|
|
|
44,259
|
|
|
|
Exhibit
|
|
|
Description
|
|
Method of Filing
|
3.1
|
|
|
|
Incorporated by Reference
|
|
3.2
|
|
|
|
Incorporated by Reference
|
|
10.1
|
|
|
|
Incorporated by Reference
|
|
10.2
|
|
|
|
Incorporated by Reference
|
|
10.3
|
|
|
|
|
Filed Electronically
|
31.1
|
|
|
|
Filed Electronically
|
|
31.2
|
|
|
|
Filed Electronically
|
|
32.1
|
|
|
|
Filed Electronically
|
|
32.2
|
|
|
|
Filed Electronically
|
|
101
|
|
|
Financial statements from the Quarterly Report on Form 10-Q of Hawkins, Inc. for the period ended September 29, 2019 filed with the SEC on October 30, 2019 formatted in Extensible Business Reporting Language (XBRL); (i) the Condensed Consolidated Balance Sheets at September 29, 2019 and March 31, 2019, (ii) the Condensed Consolidated Statements of Income for the three and six months ended September 29, 2019 and September 30, 2018, (iii) the Condensed Consolidated Statements of Comprehensive Income for the three and six months ended September 29, 2019 and September 30, 2018, (iv) the Condensed Consolidated Statements of Shareholder's Equity for the three and six months ended September 29, 2019 and September 30, 2018, (v) the Condensed Consolidated Statements of Cash Flows for the six months ended September 29, 2019 and September 30, 2018, and (vi) Notes to Condensed Consolidated Financial Statements.
|
|
Filed Electronically
|
(1)
|
Incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2010, filed on July 29, 2010 (File no. 000-07647).
|
(2)
|
Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated October 28, 2009 and filed November 3, 2009 (File no. 000-07647).
|
(3)
|
Incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 filed November 2, 2018 (File no. 333-228128).
|
(4)
|
Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form 8-K filed December 3, 2018 (File no. 000-07647).
|
HAWKINS, INC.
|
|
||
|
|
|
|
By:
|
|
/s/ Jeffrey P. Oldenkamp
|
|
|
|
Jeffrey P. Oldenkamp
|
|
|
|
Vice President, Chief Financial Officer, and Treasurer
|
|
|
|
(On behalf of the registrant and as principal financial and accounting officer)
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Hawkins, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Patrick H. Hawkins
|
|
Patrick H. Hawkins
|
|
Chief Executive Officer and President
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Hawkins, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Jeffrey P. Oldenkamp
|
|
Jeffrey P. Oldenkamp
|
|
Vice President, Chief Financial Officer, and Treasurer
|
/s/ Patrick H. Hawkins
|
Patrick H. Hawkins
|
Chief Executive Officer and President
|
October 30, 2019
|
/s/ Jeffrey P. Oldenkamp
|
Jeffrey P. Oldenkamp
|
Vice President, Chief Financial Officer, and Treasurer
|
October 30, 2019
|