Hawkins, Inc. (HWKN): BCG Matrix [Dec-2025 Updated]

The late 2025 view of Hawkins, Inc.'s portfolio is sharp: the Water Treatment unit is a clear Star, posting 23% sales growth on $446.5 million in FY25 revenue, while the smallest Food & Health Sciences unit sits as a classic Question Mark after a 1% sales dip. Honestly, the core Industrial Solutions segment is a mixed bag, supporting the whole operation with Cash Cow stability but dragging margins down with its commoditized Dog products showing a low 19% gross margin. You need to know where the cash is flowing and where the future investment must go, so check out the breakdown below to see exactly where Hawkins, Inc. needs to double down or cut bait.

Background of Hawkins, Inc. (HWKN)

You're looking at Hawkins, Inc. (HWKN), a specialty chemical and ingredients company that has been around since it was founded in 1938. Honestly, the company's longevity speaks to its core business: supplying essential chemicals and services. Headquartered in Roseville, Minnesota, Hawkins, Inc. has built a significant presence across the United States, operating 64 facilities in 28 states as of late 2025.

Hawkins, Inc. structures its operations into three main segments: Water Treatment, Industrial, and Health and Nutrition. The Water Treatment segment is a major focus, providing chemicals, equipment, and solutions for things like municipal and industrial wastewater, potable water, and agricultural water needs. The Industrial segment handles a broad range of industrial chemicals, products, and services for sectors like agriculture, electronics, food, and pharmaceuticals, often involving custom blending and repackaging.

The Health and Nutrition segment focuses on ingredient distribution, processing, and formulation solutions. This supports manufacturers in the nutraceutical, functional food and beverage, dietary supplement, and personal care industries. This diversified approach helps Hawkins, Inc. maintain relevance across critical, non-cyclical end markets.

Looking at the most recent full fiscal year, which ended March 30, 2025 (Fiscal Year 2025), the company posted record annual sales of $974.4 million, marking a 6% increase over the prior year. That growth translated to a record gross profit of $225.5 million, up 16%, and record diluted Earnings Per Share (EPS) of $4.03, which was 12% higher than Fiscal Year 2024. The company also generated operating cash flow of $111.1 million and ended the year with a leverage ratio of 0.86x adjusted EBITDA.

More recently, for the second quarter of Fiscal Year 2026, ended September 28, 2025, the results were strong again. Revenue hit a record $280.4 million, a 14% jump year-over-year, with all three segments contributing to growth. The Water Treatment segment led the way with 21% revenue growth, while the Industrial Solutions segment grew 11%, and the Food and Health Sciences segment saw 2% growth. This performance pushed the trailing 12-month adjusted EBITDA past $178 million.

You should also note their commitment to shareholders; Hawkins, Inc. paid cash dividends of $0.70 per share for Fiscal Year 2025, an 11% increase, which marked the 40th consecutive year of paying a dividend. They are actively managing their balance sheet, having repaid $20 million on their line of credit during that second quarter of FY2026.

Hawkins, Inc. (HWKN) - BCG Matrix: Stars

The Water Treatment segment of Hawkins, Inc. is clearly positioned as a Star within the portfolio, demonstrating both market leadership and high growth, which necessitates substantial ongoing investment to secure future Cash Cow status.

This segment is the clear market leader, posting $446.5 million in fiscal 2025 sales. This figure represented a significant portion of the company's total fiscal 2025 revenue of $974.4 million. The segment's performance is the primary engine for overall company growth, which saw total revenue increase by 6% in fiscal 2025.

Segment sales grew by 23% in fiscal 2025, a performance driven by both strategic acquisitions and strong organic volume. Specifically, of the $83.2 million increase in segment sales year-over-year, $72 million was attributed to acquired businesses in fiscal 2025.

The high-growth trajectory is confirmed by recent results. The segment posted revenue growth of 21% in the second quarter of fiscal 2026 over the prior year period. Furthermore, management has projected that the Water Treatment segment revenue will exceed $500 million by fiscal 2026, signaling continued aggressive expansion.

Maintaining this leadership position in a rapidly expanding market requires significant capital investment, which aligns with the cash consumption typical of a Star. This investment is evident in the associated operating costs linked to growth through acquisition. For instance, selling, general, and administrative expenses for the full fiscal 2025 year increased by 19% to $106.4 million, largely due to $10.4 million in added costs from the acquired Water Treatment business, which included $4.2 million in amortization of intangibles. In the second quarter of fiscal 2026 alone, added costs from the acquired Water Treatment business in SG&A included $2.5 million in amortization of intangibles.

Here's a look at the recent growth metrics:

• Fiscal 2025 Water Treatment sales: $446.5 million.
• Fiscal 2025 segment sales growth: 23%.
• Q2 Fiscal 2026 segment sales growth: 21%.
• FY2025 acquisition-related SG&A amortization: $4.2 million.
• Projected FY2026 segment sales: Exceed $500 million.

The segment's profitability remains strong, with its gross profit margin at 29% of sales in Q1 fiscal 2026, up from 30% of sales in Q1 fiscal 2025, showing resilience despite integration costs.

You need to ensure the capital allocation plan supports this high-growth unit to convert its market leadership into sustained, high-margin cash generation. Finance: draft 13-week cash view by Friday.

Hawkins, Inc. (HWKN) - BCG Matrix: Cash Cows

You're looking at the core engine of Hawkins, Inc.'s financial stability, the segment that generates the surplus cash you need for everything else. That's the Cash Cow quadrant, and for Hawkins, Inc., the Industrial Solutions segment fits that role well.

This segment is your established market leader in a mature space. It doesn't require massive spending to grow its market share because it already has a strong footing. Honestly, the focus here is on efficiency and milking that existing position for all it's worth. If onboarding takes 14+ days, churn risk rises, but for this segment, the distribution network is the moat.

The numbers from fiscal 2025 clearly show this dynamic. The Industrial Solutions segment brought in $382.5 million in sales, making it the second-largest contributor to the top line, right behind the high-growth Water Treatment area. What's key is the cash generation. That segment delivered a gross profit of $72.6 million in fiscal 2025. That's a gross margin of about 19.0% on those sales, which is solid for a mature industrial chemical business.

Here's a quick look at how the segments stacked up in fiscal 2025, so you can see the relative scale:

What this estimate hides is that the gross profit for Health and Nutrition is not explicitly stated as $31.3M for FY2025, but the total gross profit was $225.5M, and Water Treatment was $121.6M. $225.5M - $121.6M - $72.6M (Industrial) = $31.3M. The margin is calculated based on the reported sales figure for H&N of $145.5M.

The Industrial Solutions segment is the workhorse that helps fund the company's ambitions elsewhere. You see this in the overall cash generation. For the full fiscal year 2025, Hawkins, Inc. generated $111.1 million in operating cash flow. Because Industrial Solutions has low capital expenditure needs-it's mostly about maintaining an established distribution network and blending capabilities-a significant portion of that $72.6 million gross profit flows down to the bottom line, helping cover corporate overhead and, crucially, funding the high-growth Water Treatment segment's acquisitions and capital needs.

You want to keep this segment healthy, not necessarily grow it aggressively. The strategy is about maintenance and maximizing the cash extraction. Think about what supports that stability:

• Maintains a high relative market share in mature chemical supply markets.
• Generated $72.6 million in gross profit in fiscal 2025.
• Contributed to total fiscal 2025 operating cash flow of $111.1 million.
• Its sales volume was up slightly year-over-year, despite lower selling prices.
• It provides the necessary cash to service corporate debt and pay shareholder dividends.

The focus for you, as an analyst, is monitoring margin stability. If competitive pricing pressures erode that 19.0% gross margin, the cash cow starts looking sickly. Finance: draft 13-week cash view by Friday.

Hawkins, Inc. (HWKN) - BCG Matrix: Dogs

You're looking at the units within Hawkins, Inc. that are dragging on overall performance, the classic BCG Matrix Dogs. For Hawkins, Inc., this quadrant is clearly anchored by certain parts of the Industrial Solutions segment, which deals with highly commoditized chemical distribution lines.

These products, which include basic acids and alkalis, operate in a mature, low-growth environment where market share gains are hard-won and margins are thin. The financial evidence from fiscal 2025 clearly points to this area as the laggard. The Industrial segment sales were $382.5 million in fiscal 2025, representing a 7% decrease from the prior year's $409.5 million in sales. This decline was primarily attributed to lower selling prices on certain products and unfavorable product mix shifts, which is the hallmark of dealing in commodities where pricing power is minimal.

The margin profile confirms the Dog status. The Industrial segment posted the lowest gross margin across the company for the full fiscal year 2025 at 19% of sales, which was $72.6 million in gross profit. This contrasts sharply with the high-growth Water Treatment segment, which achieved a 27% gross margin that year. Honestly, when you see a segment with the lowest margin and a sales decline, you know you're looking at a Dog.

Here's a quick comparison of the segments for fiscal 2025 to put that 19% margin in perspective:

The overall company revenue for fiscal 2025 was $974.4 million, so the Industrial segment still accounts for a significant portion at over 39% of the total top line, making its underperformance material. The strategy here should align with the Dog quadrant's mandate: minimal investment is warranted. The company's stated intent to evolve into a specialty ingredients company suggests these commodity distribution assets are candidates for harvesting or outright divestiture of non-core assets, rather than funding expensive turn-around plans.

The characteristics defining these units as Dogs include:

• Highly commoditized chemical distribution lines.
• Fiscal 2025 sales decline of 7%.
• Lowest segment gross margin at 19% in fiscal 2025.
• Sales decline driven by lower selling prices.

You've got money tied up in assets that aren't growing and aren't generating premium returns. Finance: draft a sensitivity analysis on the impact of divesting $382.5 million in Industrial segment revenue by Q4 2026.

Hawkins, Inc. (HWKN) - BCG Matrix: Question Marks

You're looking at the Food & Health Sciences segment of Hawkins, Inc. as a classic Question Mark. This part of the business sits in a high-growth market-think nutraceuticals and functional foods-but it hasn't captured significant market share yet. That's the setup for high risk and potentially high reward.

The segment was the smallest contributor to the top line, reporting $145.5 million in fiscal 2025 sales. To be fair, the market dynamics are strong, but Hawkins, Inc.'s own sales performance in fiscal 2025 was nearly flat, actually showing a slight decline of 1% for the year. This lack of traction in a growing space is what flags it as a Question Mark; it's consuming resources without delivering the growth expected of a Star.

The future for Food & Health Sciences requires a big, clear decision from management. You either invest heavily to aggressively gain market share-pushing it toward Star status-or you decide the capital is better deployed elsewhere and divest. The gross profit margin in fiscal 2025, or at least the most recent reported quarter, shows some underlying attractiveness. For the first quarter of fiscal 2026, the segment posted a gross profit margin of 22% of sales, which is solid, but the low overall market share keeps the risk profile elevated.

Here's a quick look at the segment's recent financial snapshot:

The core issue is cash consumption versus return. Question Marks, by definition, need cash infusions to fund the marketing and expansion required to build that market share. If they don't gain share quickly, the high growth market they are in will eventually slow, and the unit will transition into a Dog, meaning it consumes cash and generates low returns.

The strategic path forward centers on rapid execution. You need to see a clear path to higher returns on investment. The decision hinges on whether the potential upside justifies the necessary cash burn.

• Invest heavily to capture market share quickly.
• Focus marketing spend on buyer discovery.
• Monitor for rapid conversion to Star status.
• Prepare for divestiture if growth stalls.
• The segment's sales represented a small portion of the total $974 million revenue in fiscal 2025.

Honestly, a 1% sales decline in a growing market is a major red flag demanding immediate attention. Finance: draft the capital allocation proposal for a 20% investment increase in this segment versus a 100% divestiture scenario by next Wednesday.