Hillman Solutions Corp.
For the period ended Jun 28, 2025. Filed Aug 5, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2025 · Filed Aug 5, 2025
HLMN$8.32-2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-29; filed 2025-04-29.
0001822492-25-000095
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-28; filed 2025-08-05.
0001822492-25-000172
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 110 previous paragraphs and 159 current paragraphs.
61 unchanged; 38 reworded; 41 added; 9 removed; 2 previous and 19 current paragraphs rearranged.
Tables are not compared: 8 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (41)
Current report
Segment Realignment
Current report
In the second quarter of 2025, the Company realigned its Hardware and Protective Solutions segment to include the sales of accessories, which are now managed by the Hardware and Protective Solutions leadership team. Previously, accessories were included under the Robotics and Digital Solutions segment leadership team. See Note 16 - Segment Reporting of the Notes to Condensed Consolidated Financial Statements for additional information.
Current report
•Hardware net sales increased by $10.2 million primarily due to price increases of $5.3 million and $5.1 million in new business.
Current report
•Warehouse expense increased $2.0 million primarily due to higher sales volumes along with increased shipping costs and additional expense related to our distribution center consolidation project.
Current report
•Selling expense increased $0.3 million due to increased variable compensation.
Current report
•General and administrative (“G&A”) was comparable to prior year.
Current report
•Warehouse expense increased $0.4 million due to inflation in labor and shipping costs.
Current report
•Selling expense decreased by $0.2 million primarily due to lower severance costs associated with restructuring activities in the prior year.
Current report
Depreciation expense increased $3.6 million due to capital spend on merchandising racks.
Current report
Canada's income from operations was comparable to prior year.
Current report
Interest expense, net, was comparable to prior year quarter.
Current report
Twenty-six weeks ended June 28, 2025 vs the Twenty-six weeks ended June 29, 2024
Current report
•Net sales for the twenty-six weeks ended June 28, 2025 were $762.1 million compared to $729.7 million for the twenty-six weeks ended June 29, 2024, an increase of approximately $32.4 million or 4.4%.
Current report
•Net income for the twenty-six weeks ended June 28, 2025 was $15.5 million, or $0.08 per diluted share, compared to net income of $11.0 million, or $0.06 per diluted share for the twenty-six weeks ended June 29, 2024.
Current report
•Adjusted EBITDA(1) totaled $129.8 million versus $120.7 million in the twenty-six weeks ended June 28, 2025 and in the twenty-six weeks ended June 29, 2024, respectively.
Current report
RESULTS OF OPERATIONS
Current report
Net Sales by Segment
Current report
Hardware and Protective Solutions net sales increased by $39.3 million in the twenty-six weeks ended June 28, 2025 due to the following:
Current report
•Hardware net sales increased by $1.9 million primarily driven by $3.0 million in price increases offset by decreased volume.
Current report
•Protective equipment net sales increased by $37.3 million primarily driven by $32.5 million of additional sales related to the Intex acquisition and the remainder was due to higher volume.
Current report
Robotics and Digital Solutions net sales in the twenty-six weeks ended June 28, 2025 increased by $2.1 million primarily driven by $6.7 million of increased prices offset by decreased volume of key and engraving sales.
Current report
Robotics and Digital Solutions cost of sales as a percentage of net sales decreased primarily due to price increases and sales mix.
Current report
Canada cost of sales as a percentage of net sales increased primarily due to increased shipping and product costs.
Current report
•Warehouse expense increased $0.9 million due to inflation in shipping costs along with rent and maintenance.
Current report
•Selling expense increased by $0.3 million primarily due to increased compensation and benefit expense.
Current report
•Warehouse expense increased $0.4 million due to inflation in labor and shipping costs.
Current report
•General and administrative (“G&A”) decreased $1.3 million due to reduced compensation and benefit expense.
Current report
Canada SG&A decreased due to the following:
Current report
•Selling expense decreased by $0.7 million primarily due to decreased compensation and benefit expense along with lower severance costs associated with restructuring activities in the prior year.
Current report
•G&A decreased by $0.7 million primarily driven by lower severance costs associated with restructuring activities in the prior year and decreased compensation and benefit expense.
Current report
Other Operating Expenses
Current report
Depreciation expense increased $6.6 million due to capital spend on merchandising racks along with key duplication kiosks.
Current report
In the twenty-six weeks ended June 29, 2024, other income (expense) consisted primarily of a $0.8 million loss on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob.
Current report
Income from Operations
Current report
Income Taxes
Current report
For the twenty-six weeks ended June 28, 2025 and twenty-six weeks ended June 29, 2024, the effective income tax rate was 29.7% and 29.5%, respectively. The Company recorded an income tax provision for the twenty-six weeks ended June 28, 2025 of $6.6 million based on a pre-tax income of $22.1 million, and an income tax provision for the twenty-six weeks ended June 29, 2024 of $4.6 million based on a pre-tax provision of $15.7 million.
Current report
32 | June 28, 2025 Form 10-Q
Current report
33 | June 28, 2025 Form 10-Q
Current report
Our revolver payments, net of draws, used cash of $13.0 million in the twenty-six weeks ended June 28, 2025 as we worked to pay down our debt.
Current report
We drew approximately $65.0 million on our revolver, in the twenty-six weeks ended June 29, 2024, primarily to fund seasonal inventory purchases along with the acquisition of Koch referenced above. We were able to fully repay the draws during the twenty-six weeks ended June 29, 2024 using cash generated from our operations. On a net basis, the activity on the revolver had no impact to our cash flows used for financing activities in the twenty-six weeks ended June 29, 2024.
Showing the first 40 of 41 passages. Open the source sections for the rest.
Removed paragraphs (9)
Previous report
2025 Term Loan Repricing
Previous report
On January 14, 2025, the Company entered into a Repricing Amendment (2025 Repricing Amendment) on its existing Senior Term Loan due July 14, 2028. The 2025 Repricing Amendment (i) reduces the interest rate per annum applicable to the Term Loan outstanding from SOFR plus a margin varying from 2.25% to 2.50% to SOFR plus a margin of 2.00%, as well as a 1.00% margin for ABR Loans and (ii) implements a 1% prepayment premium for the existing Term Loan to apply to Repricing Transactions that occur within six months after the effective date of the 2025 Repricing Amendment. In connection with the closing of the 2025 Repricing Amendment, the Company expensed $0.9 million of new fees.
Previous report
•Hardware net sales decreased by $8.4 million primarily due to decreased volume of $6.8 million driven by market softness and the remaining was driven by reduced price.
Previous report
•Selling expense was comparable to prior year.
Previous report
•Warehouse expense was comparable to prior year.
Previous report
Depreciation expense increased $3.1 million due to capital spend on merchandising racks.
Previous report
Investing Cash Flows:
Previous report
Our revolver payments, net of draws, provided cash of $18.0 million in the thirteen weeks ended March 29, 2025 to fund capital expenditures to support the seasonality of business.
Previous report
In the thirteen weeks ended March 30, 2024, revolver repayments, net of draws, provided $18.0 million primarily to fund the acquisition of Koch Industries, Inc, referenced above.
Reworded paragraphs (38)
Previous wording
Hillman Solutions Corp. and its wholly-owned subsidiaries (collectively, “Hillman” or “Company”) are one of the largest providers of hardware-related products and related merchandising services to retail markets in North America. Our principal business is operated through our wholly-owned subsidiary, Hillman Solutions Corp. and its wholly-owned subsidiaries (collectively, “Hillman Group”), which had net sales of $359.3 million in the thirteen weeks ended March 29, 2025. Hillman sells its products to hardware stores, home improvement centers, mass merchants, pet supply stores, and other retail outlets principally in the United States, Canada, and Mexico. Product lines include thousands of small hardware parts such as fasteners and related items; threaded rod and metal shapes; keys and accessories; builder's hardware; personal protective equipment, such as gloves and eyewear; rope and chain; and identification items, such as tags and letters, numbers, and signs. We support product sales with services that include design and installation of merchandising systems, maintenance of appropriate in-store inventory levels, and break-fix for our robotics kiosks.
Current wording
Hillman Solutions Corp. and its wholly-owned subsidiaries (collectively, “Hillman” or “Company”) are one of the largest providers of hardware-related products and related merchandising services to retail markets in North America. Our principal business is operated through our wholly-owned subsidiary, Hillman Solutions Corp. and its wholly-owned subsidiaries (collectively, “Hillman Group”), which had net sales of $402.8 million in the thirteen weeks ended June 28, 2025 and $762.1 million in the twenty-six weeks ended June 28, 2025. Hillman sells its products to hardware stores, home improvement centers, mass merchants, pet supply stores, and other retail outlets principally in the United States, Canada, and Mexico. Product lines include thousands of small hardware parts such as fasteners and related items; threaded rod and metal shapes; keys and accessories; builder's hardware; personal protective equipment, such as gloves and eyewear; rope and chain; and identification items, such as tags and letters, numbers, and signs. We support product sales with services that include design and
Previous wording
In the first quarter of 2025 and during April 2025, the U.S. government announced tariffs on imports from countries from which we import products and components. Subsequent to their announcement, there have been changes to the effective dates and amounts, and as a result, we are unable to fully quantify the impact that tariffs, when ultimately enacted, will have on our results of operations given the dynamic tariff environment.
Current wording
In the first half of 2025, the U.S. government announced tariffs on imports from countries from which we import products and components. Subsequent to their announcements, there have been changes to the effective dates and amounts, and as a result, we are unable to fully quantify the impact that tariffs, when ultimately enacted, will have on our results of operations given the dynamic tariff environment.
Previous wording
We estimate we source approximately 33% of our products from China, 33% from suppliers based in North America, and 33% from all other countries. Based on the current facts and tariff environment as of the date of this filing, we expect the tariffs to drive an increase in our net working capital. Our current expectation is to raise our prices to cover the higher tariff impacted inventory cost, though there are no assurances that we will be successful in doing so, and price increases could impact future demand for our products. We continue to analyze the impact of these actions and what, if any, steps, including pricing actions, we may take to mitigate the impact of the tariffs.
Current wording
We estimate we source approximately 33% of our products from China, 33% from suppliers based in North America, and 33% from all other countries. Based on the current facts and tariff environment as of the date of this filing, we expect the tariffs to drive an increase in our net working capital. We have raised our prices to offset the tariff costs that are expected to increase our cost of sales, although these price increases could impact future demand for our products. We continue to analyze the impact of these actions and what, if any, steps, including pricing actions, we may take to mitigate the impact of the tariffs. We are also exploring alternative suppliers in other countries as part of our sourcing strategy to reduce the impact of these tariffs.
Previous wording
We are exposed to the risk of unfavorable changes in foreign currency exchange rates for the U.S. dollar versus local currency of our suppliers, particularly those located in China and Taiwan, because we purchase a majority of our products for resale from multiple vendors located in these countries. The purchase price of these products is routinely negotiated in U.S. dollar amounts rather than the local currency of the vendors and our suppliers' profit margins decrease when the U.S. dollar declines in value relative to the local currency. This puts pressure on our suppliers to increase prices to us. The U.S. dollar declined in value relative to the CNY by approximately 0.5% in the thirteen weeks ended March 29, 2025, increased by 2.8% in 2024, and increased by 2.9% in 2023. The U.S. dollar increased in value relative to the Taiwan dollar by approximately 1.0% in the thirteen weeks ended March 29, 2025, increased by 7.1% in 2024, and declined by 0.4% in 2023.
Current wording
We are exposed to the risk of unfavorable changes in foreign currency exchange rates for the U.S. dollar versus local currency of our suppliers, particularly those located in China and Taiwan, because we purchase a majority of our products for resale from multiple vendors located in these countries. The purchase price of these products is routinely negotiated in U.S. dollar amounts rather than the local currency of the vendors and our suppliers' profit margins decrease when the U.S. dollar declines in value relative to the local currency. This puts pressure on our suppliers to increase prices to us. The U.S. dollar declined in value relative to the CNY by approximately 1.7% in the twenty-six weeks ended June 28, 2025, increased by 2.8% in 2024, and increased by 2.9% in 2023. The U.S. dollar declined in value relative to the Taiwan dollar by approximately 11.4% in the twenty-six weeks ended June 28, 2025, increased by 7.1% in 2024, and declined by 0.4% in 2023.
Previous wording
We are also exposed to risk of unfavorable changes in the Canadian dollar exchange rate versus the U.S. dollar. Our sales in Canada are denominated in Canadian dollars, while a majority of the products are sourced in U.S. dollars. A weakening of the Canadian dollar versus the U.S. dollar results in lower sales in terms of U.S. dollars while the cost of sales remains unchanged. We have a practice of hedging some of our Canadian subsidiary's purchases denominated in U.S. dollars. The U.S. dollar declined in value relative to the Canadian dollar by approximately 0.8% in the thirteen weeks ended March 29, 2025, increased by 9.0% in 2024, and declined by 2.4% in 2023.
Current wording
We are also exposed to risk of unfavorable changes in the Canadian dollar exchange rate versus the U.S. dollar. Our sales in Canada are denominated in Canadian dollars, while a majority of the products are sourced in U.S. dollars. A weakening of the Canadian dollar versus the U.S. dollar results in lower sales in terms of U.S. dollars while the cost of sales remains unchanged. We have a practice of hedging some of our Canadian subsidiary's purchases denominated in U.S. dollars. The U.S. dollar declined in value relative to the Canadian dollar by approximately 5.1% in the twenty-six weeks ended June 28, 2025, increased by 9.0% in 2024, and declined by 2.4% in 2023.
Previous wording
•Net sales for the thirteen weeks ended March 29, 2025 were $359.3 million compared to net sales of $350.3 million for the thirteen weeks ended March 30, 2024, an increase of approximately $9.0 million or 2.6%.
Current wording
•Net sales for the thirteen weeks ended June 28, 2025 were $402.8 million compared to net sales of $379.4 million for the thirteen weeks ended June 29, 2024, an increase of approximately $23.4 million or 6.2%.
Previous wording
•Net loss for the thirteen weeks ended March 29, 2025 was $(0.3) million, or $(0.00) per diluted share, compared to net loss of $(1.5) million, or $(0.01) per diluted share for the thirteen weeks ended March 30, 2024.
Current wording
•Net income for the thirteen weeks ended June 28, 2025 was $15.8 million, or $0.08 per diluted share, compared to net income of $12.5 million, or $0.06 per diluted share for the thirteen weeks ended June 29, 2024.
Previous wording
•Adjusted EBITDA(1) totaled $54.5 million versus $52.3 million in the thirteen weeks ended March 29, 2025 and in the thirteen weeks ended March 30, 2024, respectively.
Current wording
•Adjusted EBITDA(1) totaled $75.2 million versus $68.4 million in the thirteen weeks ended June 28, 2025 and in the thirteen weeks ended June 29, 2024, respectively.
Previous wording
(1)Adjusted EBITDA is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net loss to Adjusted EBITDA.
Current wording
(1)Adjusted EBITDA is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income to Adjusted EBITDA.
Previous wording
The increase in total net sales during the first quarter of 2025 was driven primarily driven by the factors described below:
Current wording
The increase in total net sales during the second quarter of 2025 was primarily driven by the factors described below:
Previous wording
Hardware and Protective Solutions' net sales increased by $14.5 million in the thirteen weeks ended March 29, 2025 due to the following:
Current wording
Hardware and Protective Solutions' net sales increased by $24.6 million in the thirteen weeks ended June 28, 2025 due to the following:
Previous wording
•Protective equipment net sales increased by $23.0 million primarily due to $16.1 million in sales related to the Intex acquisition and increased volume of $7.2 million.
Current wording
•Protective equipment net sales increased by $14.4 million primarily due to $16.4 million in additional sales related to the Intex acquisition, partially offset by lower volume.
Previous wording
Robotics and Digital Solutions' net sales in the thirteen weeks ended March 29, 2025 increased by $1.0 million primarily due to increased prices.
Current wording
Robotics and Digital Solutions' net sales in the thirteen weeks ended June 28, 2025 increased by $1.3 million primarily due to price increases.
Previous wording
Canada net sales decreased by $6.5 million primarily due to reduced volume of $4.5 million driven by market softness and an unfavorable impact of the exchange rate from Canadian dollars to U.S. dollars.
Current wording
Canada net sales decreased by $2.5 million primarily due to reduced volume of $1.2 million driven by market softness and an unfavorable impact of the exchange rate from Canadian dollars to U.S. dollars.
Previous wording
Hardware and Protective Solutions' cost of sales as a percentage of net sales increased primarily due a higher mix of Protective Solutions sales which generally have higher costs than Hardware Solutions.
Current wording
Hardware and Protective Solutions' cost of sales as a percentage of net sales increased primarily due to a higher mix of Protective Solutions sales which generally have higher costs than Hardware Solutions, in addition to increased product and shipping costs.
Previous wording
Robotics and Digital Solutions' cost of sales as a percentage of net sales increased due to increased product and shipping costs.
Current wording
Robotics and Digital Solutions' cost of sales as a percentage of net sales decreased due to price increases and sales mix.
Previous wording
Canada cost of sales as a percentage of net sales was comparable to prior year.
Current wording
Canada cost of sales as a percentage of net sales increased primarily due to increased product and shipping costs.
Previous wording
•Selling expense increased $2.5 million primarily due to increased variable selling expenses due to the shift from full-service keys to self-service keys, which have a higher variable selling cost.
Current wording
•Selling expense increased $1.3 million primarily due to increased variable selling expenses due to the shift from full-service keys to self-service keys, which have a higher variable selling cost.
Previous wording
•G&A expense decreased by $0.9 million primarily due to reduced variable compensation.
Current wording
•G&A expense decreased $0.3 million. The decrease was primarily due to decreased variable compensation expense.
Previous wording
Canada SG&A increased due to the following:
Current wording
Canada SG&A decreased due to the following:
Previous wording
•Selling expense decreased by $0.5 million primarily due to reduced variable compensation expenses.
Current wording
•G&A decreased by $0.5 million primarily due to lower severance costs associated with restructuring activities in the prior year.
Previous wording
•Warehouse expense decreased by $0.9 million primarily due primarily due to lower sales volumes along with improved operational efficiencies.
Current wording
•Warehouse expense decreased by $0.3 million primarily due to lower sales volumes.
Previous wording
In the thirteen weeks ended March 29, 2025, other income (expense) consisted primarily of a $0.3 million gain on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob (see Note 15 - Fair Value Measurements of the Notes to Condensed Consolidated Financial Statements for additional information). In addition, we recorded income related to certain rebates received of $0.2 million along with exchange rate losses of $0.1 million in the thirteen weeks ended March 29, 2025.
Current wording
In the thirteen weeks ended June 28, 2025, other income (expense) consisted primarily of exchange rate gains of $0.3 million in the thirteen weeks ended June 28, 2025, and a $0.2 million gain on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob (see Note 15 - Fair Value Measurements of the Notes to Condensed Consolidated Financial Statements for additional information). In addition, we recorded income related to certain rebates received of $0.2 million.
Previous wording
In the thirteen weeks ended March 30, 2024, other income (expense) consisted primarily of a $0.3 million loss on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob. We also recorded exchange rate gains of $0.2 million in the thirteen weeks ended March 30, 2024.
Current wording
In the thirteen weeks ended June 29, 2024, other income (expense) consisted primarily of a $0.4 million loss on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob.
Previous wording
Income from operations in our Hardware and Protective Solutions segment increased $1.8 million due to the changes in net sales, cost of sales, and SG&A expenses described above in addition to an increase in depreciation expense of $1.7 million due to capital spend on merchandising racks.
Current wording
Income from operations in our Hardware and Protective Solutions segment increased $4.5 million due to the changes in net sales, cost of sales, and SG&A expenses described above, in addition to an increase in depreciation expense of $1.9 million due to capital spend on merchandising racks.
Previous wording
For the thirteen weeks ended March 29, 2025 and thirteen weeks ended March 30, 2024, the effective income tax rate was 9.7% and 24.5%, respectively. The Company recorded an income tax benefit for the thirteen weeks ended March 29, 2025 of $34 thousand based on a pre-tax loss of $351 thousand, and an income tax benefit for the thirteen weeks ended March 30, 2024 of $0.5 million based on a pre-tax loss of $2.0 million.
Current wording
For the thirteen weeks ended June 28, 2025 and thirteen weeks ended June 29, 2024, the effective income tax rate was 29.4% and 29.0%, respectively. The Company recorded an income tax provision for the thirteen weeks ended June 28, 2025 of $6.6 million based on a pre-tax income of $22.4 million, and an income tax provision for the thirteen weeks ended June 29, 2024 of $5.1 million based on a pre-tax income of $17.6 million.
Previous wording
•General and administrative (“G&A”) increased $1.6 million. The increase was primarily due an increased investment into information technology along with $1.4 million in corporate restructuring expense partially offset by decreased variable compensation expense.
Current wording
•General and administrative (“G&A”) increased $1.5 million. The increase was primarily driven by an increased investment into information technology.
Previous wording
Amortization expense in the thirteen weeks ended March 29, 2025 increased by $0.2 million primarily due to increased intangible assets related to the Intex acquisition (see Note 4 - Acquisitions for additional information).
Current wording
Amortization expense in the twenty-six weeks ended June 28, 2025 increased by $0.2 million primarily due to the additional amortization related to the Intex acquisition.
Previous wording
Income from operations in our Robotics and Digital Solutions segment decreased $2.3 million. The $2.3 million decrease is primarily due to the changes in net sales, cost of sales, and SG&A expenses described above, in addition to an increase in depreciation expense of $1.5 million due to capital spend on key duplication kiosks and machines and an increase of $0.7 million in other income driven by the changes in revaluation of the contingent consideration described above.
Current wording
Income from operations in our Robotics and Digital Solutions segment decreased $1.8 million. The $1.8 million decrease is primarily due to the changes in net sales, cost of sales, and SG&A expenses described above, offset by an increase in depreciation expense of $3.1 million due to capital spend on key duplication kiosks and machines and an increase of $1.3 million in other expense driven by the changes in revaluation of the contingent consideration described above.
Previous wording
Canada's income from operations decreased by $0.8 million primarily due to the changes in net sales, cost of sales and SG&A expenses described above. In the thirteen weeks ended March 29, 2025, Canada recorded exchange rate losses of $0.2 million and in the thirteen weeks ended March 30, 2024, Canada recorded exchange rate gains of $0.1 million.
Current wording
Canada's income from operations decreased by $0.7 million primarily due to the changes in net sales, cost of sales and SG&A expenses described above offset by exchange rate gains of $0.1 million in the twenty-six weeks ended June 28, 2025 and exchange rate losses of $0.5 million in the twenty-six weeks ended June 29, 2024.
Previous wording
Interest expense, net, decreased $0.8 million in the thirteen weeks ended March 29, 2025, primarily due to a reduction in outstanding debt and a reduction in interest rate spreads driven by the debt repricing in the first quarter of 2025 (see Note 9 - Long-term Debt of the Notes to Condensed Consolidated Financial Statements for additional information).
Current wording
Interest expense, net, decreased $0.9 million in the twenty-six weeks ended June 28, 2025 primarily due to a reduction in outstanding debt and a reduction in interest rate spreads driven by the debt repricing in the first quarter of 2025(see Note 9 - Long-term Debt of the Notes to Condensed Consolidated Financial Statements for additional information).
Previous wording
combinations. It is also unaffected by our capital and tax structures, as our management excludes these results when evaluating our operating performance. Our management uses this financial measure to evaluate our consolidated operating performance and the operating performance of our operating segments as well as to allocate resources and capital to our operating segments. Additionally, we believe that Adjusted EBITDA is useful to investors because it is one of the bases for comparing our operating performance with that of other companies in our industries, although our measure of Adjusted EBITDA may not be directly comparable to similar measures used by other companies.
Current wording
Adjusted EBITDA is a non-GAAP financial measure and is the primary basis used to measure the operational strength and performance of our businesses, as well as to assist in the evaluation of underlying trends in our businesses. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of our businesses and from intangible assets recognized in business combinations. It is also unaffected by our capital and tax structures, as our management excludes these results when evaluating our operating performance. Our management uses this financial measure to evaluate our consolidated operating performance and the operating performance of our operating segments as well as to allocate resources and capital to our operating segments. Additionally, we believe that Adjusted EBITDA is useful to investors because it is one of the bases for comparing our operating performance with that of other companies in our industries, although our measure of Adjusted EBITDA may not be directly comparable to similar measures used by other companies.
Previous wording
Our working capital position, which we define as current assets minus current liabilities, of $347.0 million as of March 29, 2025 represents an increase of $27.5 million from the December 28, 2024 level of $319.5 million driven by seasonality of the business. We expect to generate sufficient operating cash flows to meet our short-term liquidity needs, and we expect to maintain access to the capital markets, although there can be no assurance of our ability to do so. However, disruption and volatility in the global capital markets and economic uncertainties driven by increases in tariffs could impact our capital resources and liquidity in the future. We do expect the current tariff environment to increase our costs of products we import, which will increase our working capital position and unfavorably impact our future cash flows (see Recent Developments - Tariff Environment of Item 2 - Management’s Discussion and Analysis and Risk Factors of Part II - Other Information for additional information).
Current wording
Our working capital position, which we define as current assets minus current liabilities, of $350.3 million as of June 28, 2025 represents an increase of $30.8 million from the December 28, 2024 level of $319.5 million driven by seasonality of the business and tariff costs. We expect to generate sufficient operating cash flows to meet our short-term liquidity needs, and we expect to maintain access to the capital markets, although there can be no assurance of our ability to do so. However, disruption and volatility in the global capital markets and economic uncertainties driven by increases in tariffs could impact our capital resources and liquidity in the future. We do expect the current tariff environment to increase our costs of products we import, which will increase our working capital position and unfavorably impact our future cash flows (see Recent Developments - Tariff Environment of Item 2 - Management’s Discussion and Analysis and Risk Factors of Part II - Other Information for additional information).
Previous wording
Net cash used for operating activities for the thirteen weeks ended March 29, 2025 was unfavorably impacted by increases in accounts receivable due to the seasonality of our business in addition to a decrease in accrued incentive compensation related to the payout of 2024 incentive compensation.
Current wording
Net cash provided by operating activities for the twenty-six weeks ended June 28, 2025 was favorably impacted by increased accounts payable due to the timing of inventory purchases and payments. Inventory and accounts payable were both impacted by the recently enacted tariffs. Net cash provided by operating activities was unfavorably impacted by a decrease in accrued incentive compensation related to the payout of 2024 incentive compensation.
Previous wording
Net cash provided by operating activities for the thirteen weeks ended March 30, 2024 was unfavorably impacted by an increase in accounts receivable due to higher sales.
Current wording
Net cash provided by operating activities for the twenty-six weeks ended June 29, 2024 was unfavorably impacted by increases in accounts receivable due to the seasonality of our business, and increased inventory driven by demand as we normalize our inventory levels. Additionally, we saw increased accounts payable due to the timing of inventory purchases and payments.
Previous wording
Cash of $20.7 million and $17.8 million was used in the thirteen weeks ended March 29, 2025 and thirteen weeks ended March 30, 2024, respectively, to invest in new key duplicating and engraving kiosks and merchandising racks.
Current wording
Cash of $38.2 million and $40.1 million was used in the twenty-six weeks ended June 28, 2025 and twenty-six weeks ended June 29, 2024, respectively, to invest in new key duplicating kiosks and merchandising racks.
Previous wording
The Company used $2.1 million of cash for principal payments on the senior term loan. As of March 29, 2025, we have outstanding borrowings of $643.3 million on the term loan. See Note 9 - Long-term Debt of the Notes to Condensed Consolidated Financial Statements for additional information.
Current wording
The Company used $4.3 million of cash for principal payments on the senior term loan. As of June 28, 2025, we have outstanding borrowings of $641.2 million on the term loan. See Note 9 - Long-term Debt of the Notes to Condensed Consolidated Financial Statements for additional information.
Previous wording
In the thirteen weeks ended March 29, 2025 and thirteen weeks ended March 30, 2024 the Company received $0.3 million and $5.9 million from the exercise of stock options, respectively.
Current wording
In the twenty-six weeks ended June 28, 2025 and twenty-six weeks ended June 29, 2024 the Company received $0.5 million and $6.4 million from the exercise of stock options, respectively.
Rearranged current paragraphs (19)
Current report — wording carried from elsewhere
installation of merchandising systems, maintenance of appropriate in-store inventory levels, and break-fix for our robotics kiosks.
Current report — wording carried from elsewhere
Amortization expense in the thirteen weeks ended June 28, 2025 was comparable to prior year quarter.
Current report — wording carried from elsewhere
Income from operations in our Robotics and Digital Solutions segment was comparable to prior year.
Current report — wording carried from elsewhere
FINANCIAL SUMMARY AND OTHER KEY METRICS
Current report — wording carried from elsewhere
The following analysis of results of operations includes a brief discussion of the factors that affected our operating results and a comparative analysis of the twenty-six weeks ended June 28, 2025 and the twenty-six weeks ended June 29, 2024.
Current report — wording carried from elsewhere
(1)Adjusted EBITDA is a non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section for additional information, including our definition and our use of Adjusted EBITDA, and for a reconciliation from net income to Adjusted EBITDA.
Current report — wording carried from elsewhere
The increase in total net sales during the twenty-six weeks ended June 28, 2025 was primarily driven by the factors described below:
Current report — wording carried from elsewhere
Canada net sales decreased by $9.0 million primarily due to volume decreases of $5.6 million and an unfavorable impact of the exchange rate from Canadian dollars to U.S. dollars of $2.8 million.
Current report — wording carried from elsewhere
Cost of Sales (excluding depreciation and amortization)
Current report — wording carried from elsewhere
The following table summarizes cost of sales by segment:
Current report — wording carried from elsewhere
Hardware and Protective Solutions cost of sales as a percentage of net sales increased primarily due to a higher mix of Protective Solutions sales which generally have higher costs than Hardware Solutions in addition to increased product and shipping costs.
Current report — wording carried from elsewhere
Selling, Warehouse, and General and Administrative Expenses
Current report — wording carried from elsewhere
The following table summarizes selling, warehouse, and general and administrative expense ("SG&A") by segment:
Current report — wording carried from elsewhere
Hardware and Protective Solutions SG&A increased due to the following:
Current report — wording carried from elsewhere
Robotics and Digital Solutions SG&A increased due to the following:
Current report — wording carried from elsewhere
•Selling expense increased by $3.7 million primarily due to the shift from full-service keys to self-service keys, which have a higher variable selling cost.
Current report — wording carried from elsewhere
In the twenty-six weeks ended June 28, 2025, other income (expense) consisted primarily of a $0.6 million gain on the revaluation of the contingent consideration associated with the acquisition of Resharp and Instafob (see Note 15 - Fair Value Measurements of the Notes to Condensed Consolidated Financial Statements for additional information). In addition, we recorded income related to certain rebates received of $0.4 million along with exchange rate gains of $0.1 million in the twenty-six weeks ended June 28, 2025.
Current report — wording carried from elsewhere
Income from operations in our Hardware and Protective Solutions segment increased $5.9 million due to the changes in net sales, cost of sales, and SG&A expenses described above in addition to an increase in depreciation expense of $3.6 million due to capital spend on merchandising racks.
Current report — wording carried from elsewhere
In 2025 and 2024, the effective tax rate differed from the U.S. federal statutory tax rate due to state and foreign income taxes and certain non-deductible expenses (see Note 8 - Income Taxes of the Notes to Condensed Consolidated Financial Statements for additional information).
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
•G&A decreased by $0.3 million primarily due to reduced variable compensation.
Previous report — wording carried elsewhere
Adjusted EBITDA is a non-GAAP financial measure and is the primary basis used to measure the operational strength and performance of our businesses, as well as to assist in the evaluation of underlying trends in our businesses. This measure eliminates the significant level of noncash depreciation and amortization expense that results from the capital-intensive nature of our businesses and from intangible assets recognized in business