Hillenbrand, Inc. (HI): Business Model Canvas [Dec-2025 Updated]

You're looking at Hillenbrand, Inc. (HI) right at a critical pivot-a pure-play industrial equipment powerhouse shedding non-core assets just before the Lone Star acquisition finalizes. Honestly, their new model is all about selling highly-engineered, mission-critical gear, which is why you see a solid $1.52 billion backlog as of September 30, 2025, supporting their $2.67 billion in total net revenue for fiscal year 2025. Before you start valuing the post-deal entity, you need to see the engine room; the Business Model Canvas below maps out exactly how they capture value from specialized engineering while managing that $1.36 billion in net debt.

Hillenbrand, Inc. (HI) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Hillenbrand, Inc. (HI) established or solidified leading up to the late 2025 period, especially those tied to its portfolio transformation and the pending take-private transaction. These partnerships are critical to understanding where the company was placing its bets.

The company's strategy involved significant divestitures to focus on core industrial segments, which naturally involved key transaction partners. Here's a look at the financial scale of these alliances:

The agreement with Lone Star Funds centers on an all-cash transaction at $32.00 per share. This represented a premium of about 37% over the unaffected closing share price on August 12, 2025, and a 53% premium over the 90-day volume-weighted average price before that date. This deal, if closed, means Hillenbrand transitions from a publicly traded firm on the NYSE to private ownership. So, this partnership is really an exit for public shareholders.

The relationship with Bain Capital is a retained minority interest following the sale of the majority stake in the Milacron injection molding and extrusion business (MIME). Hillenbrand received $287 million for the sale of the approximate 51% majority interest, yielding after-tax net proceeds of about $250 million, which was directed toward debt paydown. For context, the divested MIME business generated $526 million in revenue and $64 million in adjusted EBITDA in fiscal year 2024.

Hillenbrand, Inc. has been actively building out its Food, Health, and Nutrition (FHN) portfolio through strategic acquisitions. The company achieved its targeted $30 million run rate cost synergies from the Linxis and FPM acquisitions ahead of schedule, just 20 months post-close. These FHN businesses, bolstered by deals like the 2023 acquisition of Schenck Process' food and performance materials business for $730 million and the 2022 purchase of Peerless Food Equipment for $59 million, represented just under 30% of total revenue on a pro forma basis as of Q2 2025.

The divestiture of the minority stake in TerraSource Holdings to Astec Industries in July 2025 was a clear move to simplify the portfolio and reduce leverage. The total transaction value was approximately $245 million, with Hillenbrand, Inc. netting approximately $115 million in cash proceeds, which was used to pay down debt. Prior to this sale, Hillenbrand held a 49% stake in the joint venture.

Regarding global suppliers for raw materials and outsourced manufacturing services, the company's focus in late 2025 was on mitigating external pressures. Management highlighted a localized supply chain strategy designed to counter tariff risks. While specific supplier contract values aren't public, the company's Q3 2025 revenue of $599 million reflected customer delays due to macroeconomic uncertainty and tariff announcements, showing the direct impact of the supply chain environment on realized revenue.

• The company used proceeds from divestitures (MIME and TerraSource) to reduce debt by over $300 million during the year.
• As of March 31, 2025, Hillenbrand's net debt stood at $1.46 billion, with a net debt to pro forma adjusted EBITDA ratio of 3.4x, inclusive of the Milacron cash proceeds.
• Hillenbrand declared a fourth quarter dividend of $0.225 per share.

Finance: review the debt reduction schedule against the projected closing date of the Lone Star transaction by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Key Activities

You're looking at the core actions Hillenbrand, Inc. (HI) takes to generate revenue and manage its portfolio as of late 2025. These activities are centered on highly engineered equipment and the integration of recent strategic moves, like the divestiture of the Batesville business and the ongoing integration of acquired entities.

Designing and engineering highly-specialized industrial processing equipment.

This activity underpins the Advanced Process Solutions (APS) segment, which serves markets like food processing and plastics. While specific R&D spend isn't itemized here, the focus is on delivering systems that complement acquisitions like LINXIS Group. The success of this design and engineering is reflected in the overall backlog, which, on a pro forma basis for the full year 2025, stood at $52 million, showing a 2% increase compared to the prior year.

Manufacturing and assembling mission-critical capital equipment globally.

This involves the production within the APS and Molding Technology Solutions (MTS) segments. The MTS segment saw a significant drop in reported net revenue, down 32%, but on a pro forma basis, the net revenue decrease was only 3% for fiscal year 2025. The APS segment's net revenue decreased 10% for the full year 2025. These figures show the direct output of the manufacturing and assembly activities, though they were impacted by lower capital equipment volumes across the board.

The relative performance of the core segments in fiscal year 2025 provides a snapshot of the capital equipment focus:

Executing the Hillenbrand Operating Model (HOM) to drive operational efficiency.

The Hillenbrand Operating Model (HOM) is the framework used to manage operations, focusing on areas like Operational Excellence and Commercial Excellence to drive margin expansion and strong free cash flow. The execution of HOM is measured through profitability metrics. For the full year 2025, the pro forma Adjusted EBITDA margin was 15%, a decrease of 180 basis points year-over-year. Furthermore, the company managed its capital structure, ending September 30, 2025, with net debt of $1.36 billion and a net debt to pro forma adjusted EBITDA ratio of 3.7x.

The HOM is also used to manage portfolio refinement, which included using proceeds from the divestiture of the MIME business and the sale of a minority stake in TerraSource (approximately $115 million from TerraSource) to pay down debt by over $300 million during fiscal year 2025.

Integrating recent acquisitions like LINXIS Group for commercial synergies.

Integrating acquired businesses is a key activity to spur growth. Hillenbrand, Inc. completed the LINXIS Group acquisition in October 2022 for an enterprise value of approximately €572 million. By the third quarter of fiscal year 2025, the company announced it had achieved $30 million in run-rate cost synergies associated with the LINXIS and FPM acquisitions, ahead of schedule. This integration is intended to enhance commercial synergy potential, particularly within the Food, Health, and Nutrition (FHN) business.

Providing high-margin aftermarket service and parts support.

This activity is a component of both the APS and MTS segments. The full year 2025 pro forma net revenue was negatively impacted by lower aftermarket parts and service volumes, which, alongside lower capital equipment volumes, contributed to the overall pro forma net revenue being down 9%. The Advanced Process Solutions (APS) segment specifically reported achieving record aftermarket orders in the prior year, indicating this is a historically strong, high-margin component of the business that faced volume headwinds in 2025.

The company's overall full year 2025 net revenue was $2.67 billion, a 16% decrease from the prior year, largely due to the MIME divestiture.

Finance: draft 13-week cash view by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Key Resources

You're looking at the core assets Hillenbrand, Inc. relies on to generate revenue, and honestly, it's a mix of tangible scale and intangible expertise.

The foundation rests on a carefully curated Portfolio of leading industrial brands. While the company has been refining its portfolio, including the divestiture of the MIME business, the core strength remains in its established names serving critical processing needs.

• - Portfolio of leading industrial brands: Coperion, Rotex, Mold-Masters, Herbold Meckesheim.
• - Global manufacturing footprint and extensive distribution network across 100+ countries.
• - Deep domain expertise in plastics, compounding, and material separation technologies.
• - Intellectual property (IP) and patents related to extrusion and molding systems.
• - Backlog of $1.52 billion as of September 30, 2025, providing revenue visibility.

That backlog figure is key; it shows committed future revenue, even as the company navigates market shifts. Here's a look at the scale of the operation as of the end of fiscal year 2025, September 30, 2025.

The global reach is supported by this operational scale. Hillenbrand, Inc. maintains operations across the Americas, Europe, the Middle East, and Asia, leveraging its distribution channels to serve customers worldwide.

The expertise in specific technologies is what underpins the value proposition for those brands. This is evident in the segment results, even after portfolio adjustments.

• Advanced Process Solutions (APS) Adjusted EBITDA Margin for FY 2025: 18.6%.
• Molding Technology Solutions (MTS) Pro Forma Adjusted EBITDA Margin for Q4 2025: 22.3%.

The company returned capital to shareholders through dividends during the year, too.

• Shareholder Dividends Paid (FY 2025): Approximately $63 million.

Also, the recent announcement of the pending acquisition by Lone Star Funds values the enterprise at approximately $3.8 billion, which reflects the market's view of the remaining core assets' worth.

Hillenbrand, Inc. (HI) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Hillenbrand, Inc. for their heavy-duty processing needs. It's about providing the machinery that keeps complex industrial lines running, day in and day out.

The primary value is delivering highly-engineered, mission-critical processing solutions for complex industrial applications. This is delivered through their segments, where the Advanced Process Solutions (APS) segment serves industries including durable plastics, food, and recycling, while the Molding Technology Solutions (MTS) segment offers equipment for those same areas, though MTS pro forma net revenue decreased by 3% in fiscal year 2025. APS net revenue saw a larger drop, decreasing by 10% for the full year 2025.

A key component of the value is the promise of long-term reliability and high uptime via stable aftermarket parts and service. Honestly, this is where the recurring value lives, even if the immediate numbers show pressure. For the full fiscal year 2025, the combined impact of lower capital equipment and aftermarket parts and service volumes contributed to a pro forma net revenue decrease of 9%. Still, the company returned approximately $63 million to shareholders via quarterly dividends in fiscal year 2025, showing a commitment to returning capital even while navigating volume softness.

Hillenbrand, Inc. offers integrated systems for plastics, food, and recycling end-markets, reducing customer complexity. They serve customers in over 100 countries, which speaks to the global need for these integrated solutions. The focus on these specific, large end-markets is clear in their strategic positioning. Here's a snapshot of the financial context around the end of fiscal year 2025:

The company is also positioning its technology for sustainable solutions, like plastics recycling equipment. This aligns with their stated purpose to Shape What Matters For Tomorrow™. They have been actively refining their portfolio, using proceeds from divestitures to pay down debt-for instance, using approximately $115 million from a TerraSource stake sale in Q3 2025 to reduce debt. Furthermore, they achieved $30 million in run-rate cost synergies from the Linxis and FPM acquisitions earlier than planned, which helps fund future strategic moves, including sustainable technology development.

Finally, the value proposition rests on deep expertise in compounding, extrusion, and material handling. This expertise is embodied in their segment structure, which serves the durable plastics, food, and recycling markets. The full-year 2025 adjusted EPS was $2.49, a 25% decrease, showing the margin pressure from lower volumes and inflation, but the GAAP EPS was $0.61, up from $(3.03) the prior year, largely due to non-cash charges. You can see the commitment to shareholders continues with a declared quarterly dividend of $0.2275 per share in December 2025, representing an annual dividend of $0.90 per share and a yield of about 2.83%.

The core value is the engineered equipment, but the financial structure shows the ongoing work to streamline operations, evidenced by the 180 basis point drop in pro forma adjusted EBITDA margin to 15% for FY 2025. Finance: draft 13-week cash view by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Customer Relationships

You're looking at how Hillenbrand, Inc. manages its connections with customers, which is key given the cyclical nature of industrial capital goods. The relationships are tiered, moving from deep, project-based commitments to ongoing service needs.

Dedicated, long-standing relationships with large industrial customers form the bedrock, especially within the newly focused portfolio areas. The company's strategic pivot emphasizes the Food, Health, and Nutrition (FHN) segment, which accounted for 25% of revenue in fiscal year 2025. These relationships are cemented by designing, manufacturing, and servicing highly-engineered, mission-critical equipment that meets complex processing requirements. The pro forma backlog, representing expected future revenue realization, stood at $52 million as of the end of fiscal year 2025, showing a 2% increase compared to the prior year, indicating continued commitment from customers on awarded contracts.

For specialized sales and engineering support for capital equipment projects, the relationship is intensive but project-dependent. The performance of the capital equipment segments shows the variability here. For instance, full year Advanced Process Solutions (APS) net revenue decreased 10% in fiscal year 2025. On a pro forma basis, the Molding Technology Solutions (MTS) segment saw net revenue decrease by 3%.

The structure of these customer interactions can be broken down by segment performance for the twelve months ended September 30, 2025:

The relationship shifts to transactional and recurring for aftermarket parts and service, which is a critical focus area for margin stability. Management remains laser-focused on driving high-margin aftermarket revenue, even as aftermarket parts and service volumes contributed to the overall pro forma net revenue decline of 9% for the full year 2025. The company's liquidity position of $632 million as of Q3 2025 helps support the necessary service infrastructure.

Support extends to customer-specific training and technical consulting services, often tied to the complex machinery sold. While direct financial figures for training revenue aren't isolated, the health of future sales is implied by operational indicators. Customer quote pipelines remain healthy, reinforcing confidence in the long-term strategy, and the company continues to execute integration initiatives and drive productivity improvements.

• Net debt to adjusted EBITDA ratio stood at 3.9x as of Q3 2025, reflecting a deleveraging trajectory that supports long-term customer commitments.
• The company is capitalizing on demand for sterile packaging solutions and modular food processing systems in regions like Asia-Pacific and Europe.

Finance: draft 13-week cash view by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Channels

You're looking at how Hillenbrand, Inc. gets its engineered equipment and solutions to its global customer base as of late 2025. The structure relies on a mix of direct engagement for large projects and a supporting network for aftermarket and international reach.

The overall scale of the business moving through these channels for the fiscal year ending September 30, 2025, was $2.67 billion in net revenue, down from $3.18 billion the prior year. The Molding Technology Solutions (MTS) segment specifically uses a combination of direct sales and a global network of independent sales representatives and distributors to move its equipment and systems.

Global direct sales force for large capital equipment and systems.

Direct sales are a primary route for large capital equipment, especially within the MTS segment. This approach is necessary for the highly-engineered, customized nature of the processing equipment Hillenbrand, Inc. provides to customers in over 100 countries. The company's focus has shifted toward higher margin/growth businesses serving the performance materials and Food, Health, and Nutrition (FHN) end markets.

Regional service centers for aftermarket parts and field service.

The aftermarket parts and service business is critical, driving record performance for two consecutive years leading up to FY 2025. This support is delivered through a global network of service professionals. The Advanced Process Solutions (APS) segment supports its offerings with distribution centers, service centers, and sales offices spread across key regions.

The physical locations supporting service and sales, as detailed in late 2025 filings, include:

E-commerce platforms for certain parts and components, defintely.

While specific e-commerce revenue figures aren't public, the strategy involves digital channels for parts and components, which is a key part of driving aftermarket revenue. This digital presence supports the sale of mission-critical processing equipment components like extruders, mixers, and feeders.

Network of independent agents and distributors in select international markets.

Independent sales representatives and distributors form a key part of the MTS sales strategy, with representatives being compensated by commission. This network helps Hillenbrand, Inc. reach its global customer base where direct sales may be less efficient. The company's overall structure is designed to maintain leadership positions even during economic downturns through this broad network.

The company's Q3 2025 net revenue was $652 million. Finance: draft 13-week cash view by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Customer Segments

You're looking at the core customer base for Hillenbrand, Inc. as of late 2025, right after they reported their Fiscal Year 2025 results. The business model clearly segments its focus across its two main operational groups: Advanced Process Solutions (APS) and Molding Technology Solutions (MTS). This split dictates where their equipment and systems land in the industrial landscape.

The Advanced Process Solutions (APS) segment is clearly geared toward high-volume, continuous processing industries. This group targets the large-scale chemical and plastics manufacturers, along with global food and pharmaceutical processing companies. You also see them serving the industrial recycling and waste management operators. To give you a sense of scale, for the third quarter ending June 30, 2025, the APS segment generated net revenue of $507 million, which was an 11% decrease year-over-year, primarily due to lower capital equipment volume. For the full fiscal year 2025, the pro forma revenue for APS saw a 10% decrease.

The Molding Technology Solutions (MTS) segment, even after the divestiture of the Milacron injection molding and extrusion (MIME) business, still focuses heavily on plastics processing. This directly serves customers in the automotive, consumer goods, and medical device manufacturing spaces. For that same Q3 2025 period, the pro forma revenue for MTS was $92 million, representing a pro forma decrease of 2%. Overall, Hillenbrand, Inc.'s reported net revenue for the full fiscal year 2025 was $2.67 billion, down 15.99% from the prior year.

Here's a quick look at how the segment revenue stacked up in the third quarter of fiscal 2025, which shows the relative size of the customer bases served by each division:

It's important to note the strategic shift; management highlighted that through acquisitions like Linxis and FPM, the company dramatically increased its exposure to the Food, Health, and Nutrition (FHN) sectors, moving from less than 3% of revenue in fiscal 2022 to over 25% in fiscal 2025. This means the global food and pharmaceutical processing companies are an increasingly central customer segment for the APS group.

You can see the focus on these core industrial customers reflected in the company's capital allocation decisions, too. Despite the revenue pressures, Hillenbrand, Inc. raised its quarterly dividend to $0.2275, which annualizes to $0.91 per share, offering a yield of approximately 2.9% as of late 2025. This commitment to shareholder returns suggests confidence in the long-term demand from these established industrial customer segments, even as the company navigates its portfolio simplification ahead of the pending acquisition at an enterprise value of approximately $3.8 billion.

The key customer groups Hillenbrand, Inc. is serving include:

• Large-scale plastics and chemicals manufacturers (APS and MTS).
• Global food and pharmaceutical processing companies (APS).
• Industrial recycling and waste management operators (APS).
• Automotive, consumer goods, and medical device manufacturers (MTS).

Hillenbrand, Inc. (HI) - Canvas Business Model: Cost Structure

You're looking at the core expenditures that drive Hillenbrand, Inc.'s operations as of the close of fiscal year 2025. These are the costs that must be covered by revenue from engineered equipment and solutions, so understanding their scale is key to assessing profitability.

The largest component of cost is definitely the Cost of goods sold (COGS) for engineered equipment. This is a significant variable cost that scales directly with sales volume. For the full fiscal year 2025, COGS totaled $1,773.0 million. This figure reflects the direct costs associated with producing the equipment and parts sold across their segments.

Next, you see the fixed and semi-fixed operating costs. Selling, General, and Administrative (SG&A) expenses for fiscal year 2025 were reported at $650.0 million. This covers everything from running the corporate structure to supporting the global sales force that drives demand for their highly-engineered products.

Investment in the future is captured by Research and development (R&D). While the full-year figure isn't explicitly broken out in the latest summaries, the Gross R&D costs for the first quarter of fiscal year 2025 were $46 million. This spend supports the development of new processing technologies, which is vital for maintaining a competitive edge in their industrial end markets.

Financing costs are a material part of the structure, especially given the debt load. As of the end of fiscal year 2025, Hillenbrand, Inc. reported net debt of $1.36 billion. The associated cost, the Interest expense, net for the full fiscal year 2025, was $92.8 million.

Finally, sustaining the asset base requires ongoing investment in property, plant, and equipment. Capital expenditures for fiscal year 2025 were approximately $38 million.

Here's a quick look at these major cost structure elements for the full fiscal year 2025:

The cost structure is heavily weighted toward variable costs (COGS) given the nature of equipment manufacturing, but the fixed overhead (SG&A) and financing costs remain substantial, especially when servicing the $1.36 billion in net debt. The company also incurred $83.5 million in Impairment charges during FY 2025, which is a non-cash cost but impacts reported profitability.

You can see the relationship between revenue and major costs below:

• - Cost of goods sold (COGS) for engineered equipment, a significant variable cost: $1,773.0 million (FY 2025).
• - Research and development (R&D) for new processing technologies: Gross R&D costs were $46 million for Q1 2025.
• - Selling, General, and Administrative (SG&A) expenses, including global sales force: $650.0 million (FY 2025).
• - Interest expense on net debt of $1.36 billion as of FY 2025 end: Full-year Interest expense, net was $92.8 million.
• - Capital expenditures of approximately $38 million in fiscal year 2025.

Finance: draft 13-week cash view by Friday.

Hillenbrand, Inc. (HI) - Canvas Business Model: Revenue Streams

You're looking at how Hillenbrand, Inc. brought in its money for the fiscal year ending September 30, 2025. Honestly, the revenue picture is dominated by selling big, engineered equipment, but the recurring bits are what keep things steady.

The core of the revenue generation comes from two main operational areas, which feed the streams you listed. You see revenue from the sale of the actual machinery, and then the follow-on business from keeping that machinery running smoothly.

• - Sales of Advanced Process Solutions (APS) capital equipment and systems.
• - Sales of Molding Technology Solutions (MTS) equipment and hot runner systems.
• - High-margin, recurring revenue from aftermarket parts and services.

Here's the quick math on the top-line performance for the full year:

When you break down the pro forma revenue performance for the full year 2025, you see that lower volumes in capital equipment and aftermarket parts and services were the main drag, though favorable foreign currency impact and pricing helped offset some of that. To be fair, the divestiture of the Milacron injection molding and extrusion (MIME) business significantly impacted the reported numbers, especially for the MTS segment.

Looking at the segment performance for the full year 2025 provides more color on where the equipment sales revenue comes from:

• - Full year Advanced Process Solutions (APS) net revenue decreased 10% compared to the prior year.
• - Full year Molding Technology Solutions (MTS) net revenue decreased 32%, or decreased 3% on a pro forma basis.
• - Pro forma net revenue for the full year was down 9%.

For context on the fourth quarter of 2025, the APS segment brought in net revenue of $557 million, which was a 6% decrease versus the prior year's fourth quarter, driven by lower capital equipment and aftermarket parts and service volumes. The MTS segment's Q4 net revenue was $95 million, a 62% decrease, largely due to the MIME divestiture. Finance: draft 13-week cash view by Friday.