Hillman Solutions Q4 2024 Earnings Report

Hillman Solutions EPS Results

• Actual EPS: $0.10
• Consensus EPS: $0.11
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: $0.10

Hillman Solutions Revenue Results

• Actual Revenue: $349.56 million
• Expected Revenue: $350.45 million
• Beat/Miss: Missed by -$891.00 thousand
• YoY Revenue Growth: N/A

Hillman Solutions Announcement Details

• Quarter: Q4 2024
• Date: 2/18/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, February 18, 2025
• Conference Call Time: 8:30AM ET

Founded in 1964 and headquartered in Cincinnati, Ohio, Hillman is a leading North American provider of complete hardware solutions, delivered with industry best customer service to over 40,000 locations. Hillman designs innovative product and merchandising solutions for complex categories that deliver an outstanding customer experience to home improvement centers, mass merchants, national and regional hardware stores, pet supply stores, and OEM & Industrial customers. Leveraging a world-class distribution and sales network, Hillman delivers a “small business” experience with “big business” efficiency.

Hillman Solutions Q4 2024 Earnings Call Transcript

Key Takeaways

• Hillman delivered its highest EBITDA in company history in 2024 and earned Vendor of the Year awards from both Home Depot and Lowe’s, reflecting strong customer integration and operational execution.
• The 2024 acquisitions of Cook Industries (rope and chain hardware) and Intex DIY (cleaning textiles) expand Hillman’s adjacent aisle presence, unlock new organic growth opportunities, and leverage its in-store service “moat.”li>
• For 2025, Hillman targets net sales of $1.495–$1.575 billion, adjusted EBITDA of $255–$275 million, free cash flow of $90–$110 million, and plans to maintain adjusted gross margins above 47% with net leverage around 2.2×.
• CEO John Michael Adanolfi’s strategy aims for 5–6% annual organic growth—driven by 2–3% market recovery and 2–3% new business wins—augmented by 2–3 strategic bolt-on acquisitions per year, with a goal of reaching $2 billion in sales within 3–5 years.
• In Robotics & Digital Solutions, Hillman is rolling out Mini Key 3.5 kiosks—which duplicate smart fobs, transponders, RFID tags and feature endless-aisle ordering—with the expectation of returning the segment to growth and generating approximately $50 million of annual free cash flow once fully deployed.

Presentation

[Operator]

Good morning, and welcome to the Fourth Quarter twenty twenty four Results and Full Year '20 '20 '5 Guidance Presentation for Hillman Solutions Corp. My name is Shannon, and I'll be your conference call operator today. Before we begin, I would like to remind our listeners that today's presentation is being recorded and simultaneously webcast. The company's earnings release and earnings presentation were issued this morning. These documents and a replay of today's presentation can be accessed on Hillman's Investor Relations website at ir.hillmangroup.com.

[Operator]

I would now like to turn the call over to Michael Kaylor with Hillman.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

Thank you, Shannon. Good morning, everyone, and thank you for joining us. I'm Michael Kaylor, Vice President of Investor Relations and Treasury. Joining me on today's call are our newly appointed President and Chief Executive Officer, John Michael Adanolfi or JMA as we call him Rocky Craft, our Chief Financial Officer and Doug Cahill, our Executive Chairman. Before we begin, I would like to remind our audience that certain statements made on today's call may be considered forward looking and are subject to the safe harbor provisions of applicable securities laws.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

These forward looking statements are not guarantees of future performance and are subject to certain risks, uncertainties, assumptions and other factors, many of which are beyond the company's control and may cause actual results to differ materially from those projected in such statements. Some of the factors that could influence our results are contained in our periodic and annual reports filed with the SEC. For more information regarding these risks and uncertainties, please see Slide two in our earnings call slide presentation, which is available on our website. In addition, on today's call, we will refer to certain non GAAP financial measures. Information regarding our use of and reconciliations of these measures to our GAAP results are available in our earnings call slide presentation.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

Please note that Hillman expects its 10 ks to be filed with the SEC on Thursday of this week. With that, Doug will begin today's call with a recap of Hillman's twenty twenty four results and highlights. We will then turn the call over to J. M. A, who will give a brief overview of his perspective on Hillman and what makes this company so special, provide some market commentary and talk about our outlook for 2025.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

Rocky will then go through our 2024 financial results before giving a detailed walk through our 2025 guidance. J. May will then give some closing comments before we open things up for your questions. With that, it's my pleasure to turn the call over to our Executive Chairman, Doug Cahill. Doug?

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Thanks, Michael. Good morning, everyone, and thank you for joining us. During 2024, our team's dedication to our customers and our commitment to driving strong financial results for our investors came together to deliver an exceptional year for Hillman. Last January, Hillman celebrated its sixtieth anniversary marking six decades of taking great care of our customers and building on our robust legacy of service, a legacy that still drives how Hillman does business today. Hillman has differentiated itself from competitors by providing unparalleled service, building deep supplier and industry relationships and providing innovative solutions for our world class customers.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

This has been a key driver of Hillman's track record of growth and why we believe we were in a great position with our company and our customers as we look to the future. During 2024, Hillman accomplished something it has never done before. The Hillman team won Vendor of the Year awards in the same year from both Home Depot and Lowe's, our two biggest customers. We couldn't be more proud. This recognition is not just a reflection of what we've achieved, it's an indication of how deeply embedded we are with our customers.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

We believe that our customers view us as trusted partners and solution providers. Our teams have done a phenomenal job managing these relationships, and they are working hard to ensure that we deliver value each and every day at each and every store. These awards highlight a year where we saw the highest EBITDA in our company's history as we continue to run our business well and take care of our great care of our customers. Our record bottom line proves that our unique business model can produce healthy profits even with market conditions like we saw last year. On the M and A front, we made two accretive bolt on acquisitions.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

In January 2024, we acquired Cook Industries, a provider of rope and chain related hardware products. And in August 2024, we acquired Intex DIY, a supplier of wiping cloths, consumable rags and cleaning textiles. These acquisitions complement Hillman perfectly. They are in adjacent aisles to what we sell today and our teams can service these products at the shelves of our customers. Both acquisitions offer organic growth opportunities as we put more stuff on the truck while providing new white space for Hillman to grow.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

We can now offer our customers even more solutions. What a competitive advantage it is to buy a company and on day one, open new growth opportunities for those companies as they now have the Hillman moat behind them, in store service, direct ship capabilities and deep relationships at all levels to the best retailers in the industry. We become really the preferred buyer of those assets from both the seller and our customers' perspective. Now let's turn to our financial highlights for the year. For sixty years, Hillman has provided products used in repair, maintenance and remodel projects done by DIYers and PROs.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Despite market softness during 2024, net sales totaled $1,473,000,000 which is just shy of our 2023 results and just above the midpoint of our most recent guidance. For the year, our top line was obviously impacted as foot traffic and our retail customers declined nearly 6% compared to last the prior year. Existing home sales again fell to thirty year lows, totaling just $4,060,000 and remodel spending declined year over year. This led to a five point reduction in our market volume in 2024. Offsetting the markets was a four point contribution from Cook and Intex, two great acquisitions we made during the year and two point contribution from new business wins as we continue to win market share.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Price was a 1% headwind for the year. For the fourth quarter, our adjusted EBITDA increased 3.5% to $56,300,000 which was right in line with our expectations. Adjusted gross margins improved three ninety basis points to 48.1% for 2024 compared to 44.2% during 2023 and forty three percent during 2022. Driving our improved bottom line and gross margins were sustained operating efficiencies, lower cost of goods sold and a shift in selling a higher margin mix of products. As JMA will expand on in a few minutes, I believe we are running the business as well as we have at any time in my tenure at Hillman.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Additionally, in 2025, we're implementing performance based equity compensation for our top executives using a return on invested capital metric. This led 50% of their annual equity grants to return on invested capital going forward. Now let me give you a few comments on the performance of our two largest business. Hardware and Protective Solutions or HPS is our biggest business. HPS increased its adjusted EBITDA by 23% for the year with flat top line results and continues to be the poster child for the Hillman Mote and the value we bring to our customers that others don't.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Our Robotics and Digital Solutions business will be a great example of both our shareholders and top customers benefiting from the new strategy we successfully launched during 2024. RDS has always been the leader for Hillman in adjusted EBITDA margins and gross margins, but the capital we have invested and the returns on that capital have been a drag on our performance. JMA will expand on our strategy and share whether this business will become a great contributor of not only adjusted EBITDA and gross margin, but cash flow too, which will drive healthy return on invested capital as our strategy plays out. I love this company and I'm honored to have turned the CEO reins over to JMA. He is the perfect fit for this experienced team and customer first culture that we have built over many years at Hillman.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

I'm proud of the great job we do for our customers, our track record for bottom line growth and how we have strengthened the balance sheet and paid down over $900,000,000 of debt in the past four years. I will continue to support this company any way that I can. And with that, it is my pleasure to turn it over to J. M. A.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thanks, Doug. I'm grateful for the opportunity to be the sixth CEO in Hillman's sixty year history. When I look around Hillman, I'm excited and encouraged about the future. I'm surrounded by a fantastic leadership team and talented folks throughout our organization. We have world class customers who trust us and are true partners and we have excellent long term suppliers.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Hillman is a great company and I'm fired up about the future. Doug and I are fully aligned on the path forward and we see a clear opportunity to accelerate growth. When I think about our strategy, our customer relationships and the unique competitive moat that defines Hillman, we have challenged ourselves to profitably grow this business to $2,000,000,000 in net sales over the next three to five years. The question is how do we get there? Well, here's how.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

First, we remain laser focused on growing and protecting the core of our business. We will continue to take care of our customers and win new business, which will add 2% to 3% top line growth per year. We also expect to see the markets return to 2% to 3% volume growth in the future. Together, new business and market growth coupled with price results in organic top line growth of 5% to 6%. This follows the trend we have seen over the last twenty plus years, but to get back to this level of growth, we need the macro environment to improve and market growth to return.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Beyond organic growth, strategic acquisitions will play a critical role in scaling our business. Our plan is to execute two to three acquisitions per year. These acquisitions will complement our moat, strengthen our competitive position and create opportunities for long term organic growth and value creation. This company has executed over 35 transactions in its history and we know how to do it well. As Doug pointed out earlier, our moat and our experience make Hillman a great buyer.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We have the right focus, the right team and the right strategy. We have executed well and we've built a strong foundation for the future. As we position Hillman for its next sixty years of growth, we have accelerated our focus on technology and are implementing plans to leverage the cloud and artificial intelligence to make our company more effective and efficient. This will allow us to take better care of our customers, improve how we do business and further strengthen our relationships with our partners. In 2025, you will see us continue to invest in our cloud migration.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We are confident that an investment like this is necessary when you have over 111,000 SKUs and shipped to nearly 30,000 retail locations annually. We are excited about this migration as it will make Hillman easier to do business with and strengthen our moat. Speaking of, let me take a few minutes to give my perspective on the Hillman moat. The first piece of our mote is our 1,200 field sales and service folks. Our customers can trust that Hillman's Warriors will be in their stores, writing orders, organizing aisles and servicing our kiosks on a regular basis.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

This not only enables our retailers to sell more product, it reduces their in store labor issues for critical categories within the store. These are examples of value adds that you get when you do business with Hillman. The second part of our moat is our ability to ship store direct. We pick, pack and ship approximately 65% of what we sell directly to the retail locations of our customers. That means the majority of our products bypass the DC networks of our customers and are shipped directly to our retailer stores.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Importantly, with high fill rates, our customers can trust that Hillman's products will arrive at their stores on time and in full. The third part of our moat comes from our sixty years of experience. Our customers don't just buy products from us, they buy solutions. They look to Hillman to help them manage the category. We have insight to data that allows us to optimize category management, remove complexity and drive results for our customers.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

That makes Hillman a trusted partner. Approximately 90% of what we sell are company owned brands. Hillman's brands are well known among the DIYer and Pro. When you buy a Hillman product, the end user knows it's great product. Additionally, distributing brands that we own allows us to differentiate our offerings, often tailoring programs and packaging to meet the needs of our customers.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Lastly, we have long standing relationships with our customers. We've been working with our top five customers for nearly thirty years on average and are viewed as a partner rather than just a supplier. Over time, we've built great relationships throughout these world class organizations. This includes the associates in the store, store managers, merchants and leadership. Together as partners, both companies are 100% aligned on selling and satisfying the needs of the end user.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Before I turn it over to Rocky, let me give you my view of the market. Over the past few years, we've proven that we can successfully navigate a challenging macro environment while still growing our bottom line at an average clip of over 7% per year. It makes sense how the macro hasn't helped, considering the pull forward of home improvement activity during COVID pandemic, the sharp decline in existing home sales and the decrease in home improvement spending over the last few years. During 2025, we're hopeful that home improvement activity starts to pick up. That said, we aren't going to predict when the market turns, but we, like our customers, will be ready when it happens.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

And our customers believe that when it does turn, that run will last for several years. That said, even if the market looks like it did in 2024, we are confident that our business will grow in 2025. The HPS business is solid and stable in both good times and bad. Throughout 2024, we've enhanced our global supply chain and continued transitioning sourcing volume out of China into Vietnam, Taiwan, India and other countries. This strategy combined with the investments into our infrastructure has enabled Hillman to build an even more efficient distribution network that is ready for growth.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Our sales and service organization has never been stronger. Throughout 2024, we've aligned our U. S. Retail Leaders and our sales and service teams under Brett Hellman. Brett is the grandson of our founder, Max Hellman, and has been taking care of our customers at Hellman for over twenty years.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Brett has excelled in every level and has grown our business meaningfully throughout his career. He has assembled a fantastic team and implemented new strategies, which are already making an impact. Together, our sales, operations and other support functions are primed for 2025. During the year, we are launching new business in both our core HBS product categories as well as our newly acquired product categories from Cook and Intex. We have secured new business wins in Power Screws, Rope and Chain, Work Gear and several other areas that will get us back to growth in 2025.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Turning to RDS. With our Mini Key 3.5 strategy in place, we believe that RDS will return to growth in 2025. Let me tell you why. First, we have a new leader, Scott Moore, who took over as President of RDS last year. He's done a great job executing our Mini Key three:five rollout ahead of schedule and has breathed new life and renewed energy into our RDS teams.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Second, both of our top two RDS partners have agreed to have our MiniKey 3.5 machines in all their stores across the country by the end of twenty twenty six. These machines feature enhanced capabilities like the ability to duplicate smart auto fobs, auto transponders, RFID fobs and also have the endless aisle. All of these new machines will have credit card readers allowing the customer to complete transactions quickly and easily right at the kiosk. Our customers love our kiosks and our revenue sharing arrangements allow our customers to collect regular payments from Hillman without having to deploy capital or any resources in their stores. These two customers have made a decision that Hellman is their partner for both manual and full service keys.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

They rely on us to grow the business and so far we are. Our Mini Key 3.5 machines are generating a healthy lift in revenue versus Mini Key three point zero and that is before Hillman and our world class customers will be aggressively going after this new market together. On the manual side of key cutting, we continue to have great engagement with ACE. Their full service approach to key cutting continues to be a differentiator for their business. The Hillman mote adds tremendous value to the complex segment of manual key cutting.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

And lastly, we have sharpened our focus when it comes to RDS capital. As Rocky talked about on the earnings call last quarter, we are approaching our investment into RDS more prudently with a focus on generating attractive returns on invested capital. Because of this, we will not invest capital to build or upgrade machines where we don't expect to see a return on investment. As a result, we expect to see some attrition with customers outside of our top three RDS partners, which are Lowe's, Home Depot and ACE. We expect RDS related CapEx will peak in 2025 and will decline by about $20,000,000 in 2026 as we complete our Mini Key 3.5 rollout.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Once we have fully deployed capital for the rollout, we expect RDS alone to generate around $50,000,000 of free cash flow on an annualized basis. Now, let's take a step back and reflect on how we've executed over the last few years. During 2023, we did a great job normalizing inventory levels, paying down debt, executing sizable new business wins and setting up Helmut for streamline operations. Last year, we saw our investments into operations pay off as we took great care of our customers, delivered improvements in our global supply chain and executed two M and A deals. This year, we will continue this momentum.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We will return to growth as we leverage the Hillman mode to win new business and execute M and A. With that, I'll turn it to Rocky to talk numbers.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Thanks, J. M. A.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Before I get into our guidance for 2025, I'll provide a summary of our fourth quarter and year end results. Fourth quarter twenty twenty four net sales increased 0.5 to $349,600,000 versus the prior year quarter. 2024 full year net sales totaled $1,473,000,000 which is down slightly versus 2023 and came in slightly above the midpoint of our revised guidance range. Twenty twenty four's top line was the result of a four point contribution from Cook and Intex, a two point contribution from new business wins offset by a 1% headwind on price and a 5% headwind from market volumes. Fourth quarter adjusted gross profit margin decreased 50 basis points to 47.7% versus the prior year quarter, which was in line with our expectations.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

For the full year 2024, adjusted gross profit margin increased three ninety basis points to 48.1% from 44.2% during 2023. Our gross margin improvement for the year was the result of improved operating efficiencies, lower COGS and a higher margin mix of products sold. Q4 twenty twenty four adjusted SG and A as a percentage of sales decreased to 31.5% from 32.5 during the year ago quarter. For the full year 2024 adjusted SG and A as a percentage of sales increased to 31.6% from 29.5%. The quarterly decrease was due to our standard employee bonus expense accrual, which was larger in Q4 twenty twenty three compared to Q4 twenty twenty four.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

The annual increase was the result of 2024 standard employee bonus expense in the aggregate and IT expense, which were both greater in 2024 than 2023, as well as the true value charge, which I will touch on in a moment. Adjusted EBITDA in the fourth quarter increased 3.5% to $56,300,000 which was right in line with our expectations. After dialogue with the SEC, we revised our presentation of adjusted EBITDA to include the $8,600,000 write off of receivables from True Value, which was previously excluded from our adjusted EBITDA figures. The charge resulted from True Value's Chapter 11 filing in October of twenty twenty four, the details of which were fully disclosed in our Q3 earnings call. The majority of this impacted our third quarter and therefore our full year results.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

The impact on the fourth quarter was minimal. That said, our adjusted EBITDA for 2024 increased 10.2% to $241,800,000 which includes the $8,600,000 charge from True Value. Our adjusted EBITDA to net sales margin during the quarter was 16.4%, which compares favorably to 14.9% a year ago. Now let me turn to cash flow and the balance sheet. During 2024, operating activities generated $183,000,000 of cash versus $283,000,000 in 2023.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Remember that during 2023, we had an outsized working capital benefit as we were able to reduce our net inventories by over $100,000,000 throughout the year as we returned to normal inventory levels following the supply chain disruption from Asia. Capital expenditures for the year were $85,000,000 compared to $66,000,000 in 2023. The increase relates to the accelerated rollout of Minute Key 3.5 and continued rollout of the new fastener set at one of our major customers. As JMA discussed, we are taking a measured and prudent approach to our CapEx investments. As you will see in our proxy statement later this year, we are introducing performance shares that use return on invested capital as a metric to determine our executive team's equity compensation.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

We believe this aligns well with our shareholders' interest and will be beneficial over the long term. Free cash flow for the year totaled $98,100,000 versus $172,300,000 in 2023. Free cash flow came in a bit below our expectations, which was impacted by CapEx and our soft top line. During the year, we used free cash flow to pay down $48,000,000 of debt and to fund the acquisitions of both Cook and Intex. We ended 2024 with $674,000,000 of net debt versus $722,000,000 at the end of twenty twenty three.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Subsequent to the end of the quarter, we repriced our term note lowering the interest rate margin by 25 basis points on our borrowing cost, which now sit at SOFR plus 200 basis points. $360,000,000 of the term note balance is swapped to a fixed all in rate of 5.69% that runs through January of twenty twenty seven. Our net debt to trailing 12 adjusted EBITDA ratio at the end of twenty twenty four was 2.8 times, which improved from 3.3 times at the end of twenty twenty three. Our long term adjusted EBITDA to net debt leverage ratio target is to be at or below 2.5 times. This leverage allows us to grow the M and A, invest in future growth opportunities and to be opportunistic when it comes to using our balance sheet to add shareholder value.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Now let me talk about our guidance. For 2025, we anticipate full year net sales to be between $1,495,000,000 to $1,575,000,000 with a midpoint of $1,535,000,000 Historically, our top line has grown about 6% annually. This consists of approximately 1% price and 2% to three percent market growth, which looks a lot like GDP and 2% to 3% growth from new business wins. The midpoint of our 2025 top line guide includes the following assumptions. We're assuming that price is neutral for the year, a 1% decrease from overall market volumes, a 2.5% lift from new business wins and a 2.5% lift from the transaction which closed at the August 2024.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

To unpack our price assumptions for 2025, we expect that price will be a headwind of about 1% during the first half of the year based on the roll forward of price givebacks that went into place in 2024. We continue to monitor our costs closely, pushing from Asia, outbound freight, rents at our distribution center, the cost of labor, I could go on and on. None of these costs are going down in our business. And we must think strategically about how and when we can offset those costs. Our 2025 net sales figure will be closely tied to our customers' performance, which is predominantly driven by their sales.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Securing new business wins coupled with the overall health of the customer, consumer, repair and remodel activity and existing home sales will our outcomes. For our bottom line, we expect full year 2025 adjusted EBITDA to total between $255,000,000 and $275,000,000 The midpoint of $265,000,000 represents an increase of about 10% versus 2024. We expect our full year adjusted gross margins to come in above 47% for the year. Lastly, free cash flow during 2025 is expected to come in between $90,000,000 to $110,000,000 with a midpoint of $100,000,000 Impacting our free cash flow expectation for the year is $90,000,000 of CapEx, which is elevated due to the expansion of our MiniKey 3.5 fleet and fastener racking at one of our major customers. We expect that we will have 2025 around 2.2 times levered.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

This assumes we fall near the midpoint of our guidance and does not include any impact of M and A. During Q1 of twenty twenty five, we expect free cash flow to be negative and our leverage will likely tick up slightly as we build inventory to support our busy spring and summer seasons. This is typical for Hillman in the normal year. After the first quarter, we expect to generate cash each quarter and see our leverage decline throughout 2025. Other assumptions that are factored into our 2025 guide are as follows: Interest expense of $45,000,000 to $55,000,000 cash interest of $40,000,000 to $50,000,000 cash taxes of $15,000,000 to $25,000,000 CapEx as I said previously of approximately $90,000,000 restructuring related and other expenses we believe will total approximately $10,000,000 and our fully diluted weighted average share count will be approximately $2.00 1,000,000 shares.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Our success managing costs and executing M and A during 2024 were big positives for Hillman. Looking forward, we look to build on this and believe that our competitive moat and long standing relationships with our customers will allow us to win. We are laser focused on getting Hillman back to growth during 2025 and look forward to updating you on our progress throughout the year. With that, let me throw it back to JMA.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thanks, Rocky.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We are optimistic about the year. We are excited to keep playing offense. We are confident we will drive share gains and generate top line and bottom line growth during 2025. We will work tirelessly to fulfill our commitment to all of our stakeholders, which include our customers, our suppliers, team members and our investors. We look forward to updating you during the year with our progress.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

With that, we'll begin the Q and A portion of our call. Shannon, please open the call for questions.

[Operator]

Thank you. Our first question comes from Brian McNamara with Canaccord. Your line is now open.

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

Good morning guys. Thanks for taking the questions. First, I was wondering if you guys could break out organic growth in Q4 by price and volume or just give kind of a rough range?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. I think what we would tell you there, when you think about price for the whole business, it was pretty similar to what we saw for the full year, Brian. So just over down 1%. And then obviously the volumes are the offset of the remainder of the arithmetic there.

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

Got it. And then secondly, I appreciate all the color on RDS. I guess, why should Minit Key three point five drive sustainable growth in RDS kind of outside this kind of maybe one times uplift we might see this year? You still have the existing home sales headwind and the like, just it's a question we consistently get from investors.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Yes, Brian, good morning. Great question. What we're really excited about is what it opens up. As I shared briefly and we've talked about in the past, we really believe that expanding beyond home and office, what's in the machine, plus the endless aisle, auto fobs, transponders really opens up some new unique opportunities for us. So we're excited.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

We've seen, as I mentioned, some nice healthy lift, again some nice traction with the customers. So we just believe it's a better solution. And the interface and the fact that we're able to help the stores be more efficient with their customers is really just is starting to get some nice traction. So it is we believe it is different and we've seen some nice lift for the machines we have in the market.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

The only thing I would add to that, Brian, I mean, as you think about RBS, it's no different than the rest of our business and how we're thinking about the future. JMA said in his prepared remarks, we're not going to predict when housing returns, when interest rates turn, but we're confident that happens. Again, pick a timeframe, the next six months, eighteen months, twenty four months, and we're really setting our business up to take advantage of those tailwinds. It's consistent with what we're hearing from our large customers, quite frankly, from all of our customers. And we're going to be ready and RDS is no different.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We're putting in a better machine with more capabilities that are not only our customers, but our consumers love. And when that turns, not only do you have a better machine that's going to generate growth for us, but you're also going to have a tailwind. Again, not to predict when that is, but I think it's in the next several years.

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

Great. And then just quickly on your gross margin assumptions for the year. I remember last May, you guys negotiated some pretty favorable container rates. I think at the time, it was like 4x the spot rate. I think your that rate is currently like I think the spot is like 2x that rate right now.

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

I'm just curious like how should folks think about container rates as it's captured into your gross margin assumptions?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. I mean for us, Brian, yes, we did have a team did a great job getting good contract rates for the contract that's going to end in April of this year. We actually feel very good about where we're positioned. We will take an increase. Two things, one is for 2025, really limited impact just based on the time it turns to the P and L.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Plus that, we have a really nice, I'll say, flow of goods because we're heavier earlier in the year than later in the year. So we are preferred, I'll say, use if you will, our customer of these carriers. So between those two pieces, we still feel confident we're going to have increases, which we're factoring into our strategy for this year, but on the lower end of our original range. So we feel good about where our contracts will be placed for 2025.

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

Awesome. Thanks a

[Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets]

lot guys. Appreciate it.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thanks Brian.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Take care Brad.

[Operator]

Our next question comes from Ryan Merkel with William Blair. Your line is now open.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Hey everyone. Thanks for the questions. Just want to hear about trends through the fourth quarter, if you saw a bit of a slowdown in December. And then how is that tracking so far in 1Q? Is it kind of stable or are you seeing any kind of lift?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. I think for Q4 was interesting to us. I mean, December is always a tough month for us and everybody you cover, Ryan. So I don't know that it was that different, if you will, than November or October. It was definitely pressure.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We've seen a stabilization in Q1 of this year. I'll just say that the trend that we expect to coming out of Q4 is actually playing true in Q1. I'm just going to leave it at that at this point.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Got it. Okay. That's helpful. And then I want to ask about tariffs. And I think there's been a few developments obviously.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Just talk about maybe how you handled tariffs in 2,009 and then will this time be any different? And it doesn't sound like you would put anything in the guidance for that. Just want to clarify that.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. So it is a situation that we talk unfortunately way too frequently about, right. It is developing by the minute almost. I mean, we were on the phone talking about it at 06:45 this morning. It is something that we were going to manage it the same way we did in 2018.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So for us, we managed in 2018. We're priced at dollar for dollar. Our team did a great job executing with our retail partners. It's transactional. And as you know, we've done a nice job managing inflation and dealing with the price challenges that come out of whether it's the freight that went up and down tariffs and the overall inflation pressure.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So, we feel like we've got the tools in place to manage it. We don't know where this one is going to land right now. So, our teams are readying. We've got we meet on it very regularly. And when we have definition and clarity around it, we'll execute.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Yes.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

Hey, Ryan. One of the things I would just say, this is Doug. A lot of retailers have categories that have historically directly imported. And we think there's an opportunity there that we've not historically had because we've got multiple sources in multiple countries. And if you think about it from their perspective, they don't go deep on a lot of things that they directly import.

[Douglas Cahill, Executive Chairman at Hillman Solutions]

So I think you're going to see with this time around some opportunities for us to pick up categories that we can add to the truck and they can get it out of their distribution center and we can go to a different country for them if they like. But they're just not that deep in those kinds of relationships and we are. So I think there's going to be a bit of an opportunity this go around for us that we didn't have last time.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Yes, that's very interesting, Doug. Thanks for mentioning that. I'll pass it on. Thanks.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thanks, Ryan.

[Matthew Bouley, Senior Equity Research Analyst at Barclays]

Thanks, Ryan.

[Operator]

Our next question comes from the line of Matthew Bouley with Barclays. Your line is now open.

[Matthew Bouley, Senior Equity Research Analyst at Barclays]

Hey, good morning everyone. Thanks for taking the questions. Wanted to ask back on RDS growth in 2025, you guys were talking about that business returning to growth. Clearly coming up on much easier comparisons, I think the business was really almost close to flat by Q4. So should you be sort of or is the expectation that you'd be turning positive on RDS as soon as Q1?

[Matthew Bouley, Senior Equity Research Analyst at Barclays]

Or is it going to kind of ramp through the year as you continue to ramp Minute Key 3.5? And also, if you could add some color on the impact of the attrition that you mentioned? Thank you.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Maybe I'll start with the rate. And yes, the short answer is that we do believe, Matt, that we will return to growth even in the first quarter. Again, not I would tell you not what we expect to see in a year or two where we believe we get back to historic growth levels, which are kind of low double digits, but we would expect to be low single to maybe even mid single digit growth in the business because primarily of the rollout of what we're doing with 3.5 with our major customers.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. And as far as on the attrition piece of it, we actually as Frame, we've got alignment with our top customers on what we're going to do this year.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes, there is a customer in our mix where we've actually come to alignment on a better profile for us and candidly probably maybe for them as well, but we've got a good path forward with them. That will add a little bit of negative pressure for the year. We still feel confident that with what actions we have in place, the 3.5 rollout, which is going well and some other initiatives that we have going on that will more than cover that up that pressure up throughout the year.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So that's about as

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

far as I want to go on that topic.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Yes. I guess just to add a little there, when you think about what we're doing around capital and look, our capital is going to be up this year because of the rollouts at our major customers with 3.5. But if you think about those customers that are not those major customers, we're not going to build machines and put them into situations where the payback doesn't make sense for us or the return on invested capital isn't at least at or above where the company is. And so again, we feel really good about building machines for our major customers where that return is quick and is above, I'll call it the current corporate average.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

If it's not, we have to have some tough conversations and we've been having this.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

Got it. Okay. Thank you for that. Great color. Secondly, I wanted to touch on price again.

[Michael Koehler, VP of Investor Relations & Treasury at Hillman Solutions]

I think you said you were still going to be comping down a point on price in the first half, but you expect to be neutral for the year. So I guess the implication, would you be expecting to be positive on price in the second half? Does that have anything to do with kind of matching tariffs dollar for dollar as you mentioned? Or just is that a fair statement that you'd be expecting positive price and sort of what drives that? Thank you.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes, it's an astute question. And that's why we kind of phrase it that way. Our expectation would be that we would be taking price in strategic categories in the second half of the year. And what I will tell you is that is not related to tariff. Again, if you go back to my prepared remarks, we talked a lot about all of the areas in our business where we're seeing inflation.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

That's kind of across the board, we believe, not only with us, but with our customers as well as our competitors. And so, it is our expectation that we're going to bring some price to the market in 2025 regardless of what happens with tariffs.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Got it. Okay. Thanks guys. Good luck.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thank you. Thanks. Take care, man.

[Operator]

Our next question comes from the line of Lee Jagoda with CGA Securities. Your line is now open.

[Will Gildea, Equity Research Associate at CJS Securities]

Hi. This is Will on for Lee. How should we think about the Canadian business, both in terms of current trends in industrial production and how that could impact volumes as well as anything related to tariffs and trade war impacts? Thank you.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. Thanks, Will. So, yes, Canada is certainly seeing some market pressures. We actually have some nice new business wins in Canada that's offsetting some of that pressure. So, from our perspective, the Canadian markets, which had a tough 2024, we're running it well.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Our President runs that Scott Wright up there in Canada, do a nice job with his team. And we're aligned with our customers, so we have some nice new business wins to offset some of the market pressure we have out there. On the industrial side, we continue to see pressure there. So that portion of the business, which we don't really break out and specify numbers on, but we've seen some pressure there. We've, I'll say, rebuilt that business over the last several years and we feel like we've got a good path forward.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So Canada will see some pressure, but we feel confident in our results overall.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Yes. The only thing I think, Will, I would add there is the one thing that we've said continuously for the last several years is the one thing we don't control is the market and we're not going to be able to. When you think about our Canadian team and what they've done, they've done a really good job of making sure that we keep the profitability in that business at an appropriate level, even in the face of pretty significant headwinds from the market, bigger than we're seeing in The U. S.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Or have seen in The U. S. So we're confident again as we think about 2025 that we've got the right people in place, the right team in Canada, and they're going to perform from a profitability perspective regardless of what happens with the markets. Again, we're going to set the Canadian business up just like The U. S.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Business. So when that economy does turn, we can take full advantage of it. And again, we're highly confident the team we have there today to do that.

[Will Gildea, Equity Research Associate at CJS Securities]

That's very helpful. Thank you.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

You're welcome.

[Operator]

Our next question comes from the line of Brian Butler with Stifel. Your line is now open.

[Brian Butler, Analyst at Stifel Financial Corp]

Hey, good morning. Thanks for taking the questions. Hey, good morning, Brian. First one, just on the RDS, maybe to just kind of just level set everybody. When you think about the 3.5 rollout by the end of twenty twenty six, maybe as we restructured it as the top three customers, where do we stand now and how do we think about by the end of twenty twenty five and then being completed in 2026?

[Brian Butler, Analyst at Stifel Financial Corp]

How does that rollout kind of break out between the years?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes, I mean, so it is heavily more heavily indexed to 2026. I mean, we do start putting machines in place back half of this year at a higher bit higher clip overall when you aggregate them together, Brian. So we feel like a nice steady flow. The machines we did finish last year in good shape as far as actually delivering the number of machines that we put into the marketplace. So from a 3.5 perspective, we felt like we finished the year a bit ahead of where we expected to.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Lowe's was well on track with where we wanted to be, and then we're going to continue to see that roll up in 2025 where we'll finish up those machines in 2025 and the 2026, and we'll do the same thing at the Home Depot. We don't want to really get too much too far to the granularity beyond that, Brian, but we feel good about that ramp. It will be pretty steady '25 into '26 is the way I'd be thinking about it.

[Brian Butler, Analyst at Stifel Financial Corp]

Okay. That's helpful. And then on the new business, the 2.5% growth kind of looking into 25%, can you give some color between where that comes from? Is that more heavily weighted towards hardware or protective or RDF kind of fitting in there with the rollout?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. I mean, the rollout is a piece of it certainly, but the heavier piece of that is the HS side of that and the hardware side of the business, Brian. We have some really exciting new products. We're actually launching some patented products in concrete screws with our one of our largest customers. We're excited about that.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We also have structural screws and high performance construction fastener that we're rolling out. So actually some nice new business in what we call CFP. So we're excited about that piece of what we got work here on the protective slot side of the business. We've got some new rollouts there that should get some nice traction. We got some good customer wins.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

And we're excited about growth with our major customers in a number of categories. Plus, as you've heard us talk about in the past, they've broken chain win with ACES in full flow in 2025, so we'll continue to look to build on that. And then some things that we're not ready to share in detail, but we got some nice traction around the Intex business and some new opportunities with major customers there. So it is actually across the board, Brian, pretty healthy mix that our sales team is out there driving and we're pretty excited about '25.

[Brian Butler, Analyst at Stifel Financial Corp]

Okay, great. And if I can get one last one, just on the acquisition environment, I mean '25, is that set up now maybe more attractive being the market being as weak as it has that you have more sellers out there and more opportunity? Or how are you looking at acquisitions for 2025?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. We're excited about the market. I'd say I don't know that the market's changed that dynamically, Brian. I'll ask Rocky to add on or Doug to if I missed anything. But I would say right now, we've got more irons in the fire now than we did last time we spoke.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

We're actually pretty excited about having a couple of nice interesting deals in front of us that we think would be great compliments to Hillman and many of the comments you heard Doug and me say on this call, on previous calls, where they would actually fit into our culture, product segments and adjacency with the customer. So we're pretty excited about where we are today. I just don't know the environment's changed dramatically, but we're looking at deals and we'll certainly keep you posted as we have more to share.

[Brian Butler, Analyst at Stifel Financial Corp]

Great. Thanks for taking my questions.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

You're welcome. Thank you.

[Operator]

Our next question comes from the line of Dave Manthey with Baird. Your line is now open.

[David Manthey, Senior Research Analyst at Baird]

Yes. Thank you. Most of my questions have been answered here. But as we recalibrate our thoughts on RDS, what are the implications for longer term EBITDA margin expectations? At the IPO, I think you were signaling 20% plus EBITDA margin target with much of that being driven by RDS.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. I think Dave, as you think about RDS, our goal is to maintain the margin rate that we have in the business, so call it 32%, thirty three %, thirty four % EBITDA rate. The nice thing about it is, when you think about our core business, we've done a nice job expanding that in the HPS business, the EBITDA rate. I think our goal over the next several years would be to hang on to the rate in HPS. As you've heard us talk about there over a three to five year period, it's probably like only one percent expansion and that's really leveraging the fixed costs that we have in the business.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

And then what you do is you get the nice mix up because of RDS back to growth. We've had this nice margin expansion in the whole business over the last couple of years with RDS being depressed. And so that getting that business back to growth is really important for us to not only grow EBITDA, but also gross margins over the longer term. So again, we feel really confident that with that business back to growth, I'm not going to predict the year, but a 20% EBITDA rate is not out of the question when you think about that mix shift.

[David Manthey, Senior Research Analyst at Baird]

And then ultimately it sounds like you're focused on returns on capital anyway, but based on your conversation earlier, we should assume that you would expect returns on capital to drift up gradually over time?

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Yes. Well, obviously, when as we think about and you see in our proxy, we'll have some goals around what returns on invested capital are in the business and we would expect that we expand those every year at least for the next three to five at a minimum. Obviously, we look at Von that's pretty tough from a modeling perspective. But where we're coming from and where we're going, we believe there's nice expansion in ROIC over the next several years.

[David Manthey, Senior Research Analyst at Baird]

Sounds good. Thank you.

[Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C]

Thanks, Dave.

[Operator]

Our next question comes from Ruben Garner with Benchmark. Your line is now open.

[Reuben Garner, Equity Research Analyst at The Benchmark Company LLC]

Thank you. Good morning guys.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Hi Ruben.

[Reuben Garner, Equity Research Analyst at The Benchmark Company LLC]

Rocky, you mentioned in your outlook for this year about 2.5 points of new business kind of baked into the midpoint, I believe. How much of that do you guys already have in hand from new shelf space that you sort of won over the last six months or so?

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Yes, I think the way to look at it, Ruben, is basically all of that is committed. The challenge that we've seen, I would say, over the last couple of years is what's the replan associated with that business because of the market volumes. And so, look, we would tell you as we sit today, we're confident that not only can we hit that call it 2.5%, but we can be above that. The risk to it is just what happens to market volumes in those categories as we load them in. If they stay where they are or they improve, we could be we will be at the high end or could be even above that kind of normal 2% to 3% range.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

Still feel confident that the markets kind of stay where they are or soften a bit that will be at 2.5%. But that's the trick to our business. We control new business wins. We control price to an extent. We can control M and A, but it's really, really hard for us to control the market.

[Robert Kraft, CFO & Treasurer at Hillman Solutions]

So you can see, we predicted the markets this year will be down one at the midpoint of our guidance and we'll see what happens throughout the year because we just don't control footsteps that are big customers.

[Reuben Garner, Equity Research Analyst at The Benchmark Company LLC]

Got it. And then a two part question on kind of I guess risks if tied to pricing and tariffs. So in the past and it's been a couple of few years since you had to put pricing through, there were some costs associated with some of your customers and changing the stickers out at the store. Can you remind us how much of your business that affects, how much that would cost? And then anything you guys or your customers are doing from an inventory standpoint?

[Reuben Garner, Equity Research Analyst at The Benchmark Company LLC]

Are you you mentioned Q1 cash flow being impacted, but that was a seasonal comment. Like are you guys building inventory in anticipation of potential tariff risks? Are your customers doing anything like that? Just big picture on tariffs. Thank you.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So I'll let Rocky add on here. But Ruben, from a cost perspective, it's $1,000,000 to $2,000,000 depending on how many labels we put in the marketplace. So I think one point would be what we do. That's just for the traditional hardware channel and not every location. The answer to that kind of that question there.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

So from an overall perspective, we'll get into that piece of it. As far as the tariffs, our cost of cost,

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

we've said a lot of times we've touched on the line.

[Operator]

Thank you. This concludes the Q and A portion of today's call. I would like to turn the call back over to J. M. A.

[Operator]

For closing comments.

[Jon Michael Adinolfi, President & CEO at Hillman Solutions]

Thanks everyone for joining us this morning. Again, I would like to thank our customers, vendors, suppliers and importantly the hardworking Hillman team for their contributions. We look forward to updating you again in the near future. Thanks and have a great day. Shannon, you may now disconnect.

Participants

Executives

• Michael Koehler, VP of Investor Relations & Treasury
• Douglas Cahill, Executive Chairman
• Jon Michael Adinolfi, President & CEO
• Robert Kraft, CFO & Treasurer

Analysts

• Brian McNamara, MD - Senior Analyst Consumer at Canaccord Genuity - Global Capital Markets
• Ryan Merkel, Co-Group Head–Industrials at William Blair & Company, L.L.C
• Matthew Bouley, Senior Equity Research Analyst at Barclays
• Will Gildea, Equity Research Associate at CJS Securities
• Brian Butler, Analyst at Stifel Financial Corp
• David Manthey, Senior Research Analyst at Baird
• Reuben Garner, Equity Research Analyst at The Benchmark Company LLC