Helios Technologies, Inc. and its wholly owned subsidiaries (Helios) operate as a global leader in highly engineered motion control and electronic controls technology for diverse end markets, including construction, material handling, agriculture, industrial, mobile, energy, recreational vehicles, marine, and health and wellness.
Segments
The company operates under two business segments: Hydraulics and Electronics.
The Hydraulics segment designs and manufactures hydraulic motion control and f...
Helios Technologies, Inc. and its wholly owned subsidiaries (Helios) operate as a global leader in highly engineered motion control and electronic controls technology for diverse end markets, including construction, material handling, agriculture, industrial, mobile, energy, recreational vehicles, marine, and health and wellness.
Segments
The company operates under two business segments: Hydraulics and Electronics.
The Hydraulics segment designs and manufactures hydraulic motion control and fluid conveyance technology products, including cartridge valves, manifolds, quick release couplings, as well as engineers hydraulic solutions and in some cases complete systems.
The Electronics segment designs and manufactures customized electronic controls systems, displays, wire harnesses, and software solutions for a variety of end markets.
Strategy
During 2021, the company augmented its strategy to transform its business from a holding company to a global integrated operating company. At that same time, the company introduced the framework of the Helios Business System, ‘HBS’, which is at the heart of all the company does. The company is accomplishing this transformation into a global integrated operating company by leveraging sales, marketing, innovation, customer relationships and operational excellence across all the company’s businesses. The company’s progress as of December 30, 2023, through a very complex macro operating environment, is a direct reflection of the commitment of the company’s talented workforce executing its augmented strategy.
The company’s trusted global brands deliver technology solutions that ensure safety, reliability, connectivity and controls.
The company continues to explore acquisition opportunities as a way to accelerate growth in line with the company’s history of acquiring companies with niche technologies, as well as strong profitability. The company’s acquisition strategy includes bolt-on flywheel acquisitions and transformational acquisitions.
The company has approximately 230 engineers in the support of product innovation, as well as technical support and customer service. The company’s product innovation will aid organic growth and fill the expected demand resulting from the megatrends of automation, digitalization, regionalization and supply chain security, productivity and technology advancements.
Acquisitions
In January 2023, the company completed the acquisition of Schultes Precision Manufacturing, Inc. (‘Schultes’). Schultes is a highly trusted specialist in manufacturing precision machined components and assemblies for customers requiring very tight tolerances, superior quality, and exceptional value-added manufacturing processes. Serving the hydraulic, aerospace, communication, food services, medical device, and dental industries, Schultes brings the manufacturing quality, reliability, and responsiveness critical to its customers’ success. Schultes provides additional manufacturing know-how and expands the company’s business into new end markets with attractive secular tailwinds.
In May 2023, the company completed the acquisition of i3 Product Development (‘i3’). i3 is a custom engineering services firm, with over 55 engineers specializing in electronics, mechanical, industrial, embedded and software engineering. i3 specializes in working to transform customer’s ideas into industrial design solutions through rapid prototyping and creating 3D models in-house. Their solutions are used across many sectors, including medical, off-highway, recreational and commercial marine, power sports, health and wellness, agriculture, consumer goods, industrial, sports and fitness.
Business Segments
The company’s Hydraulics segment includes products sold under the Sun Hydraulics, Faster, Custom Fluidpower, Seungwon, NEM, Taimi, Daman and Schultes brands. The Electronics segment includes products sold under the Enovation Controls, Murphy, Zero Off, HCT, Balboa Water Group and Joyonway brands.
Hydraulics
The company is evolving how the company classifies the key technologies within the company’s Hydraulics segment into two categories based on Hydraulic system architecture: motion control technology (‘MCT’) and fluid conveyance technology (‘FCT’). MCT includes components used to control the flow and pressure of fluids in a system. FCT includes components used to convey fluids and fluid power through a system and are designed to grant maximum flexibility of design and reliability. MCT includes the company’s cartridge valve technology (‘CVT’) where the company pioneered a fundamentally different design platform employing a floating nose construction that results in a self-alignment characteristic. This design provides better performance and reliability advantages compared with most competitors’ product offerings. The company’s cartridge valves are offered in several size ranges and include both electrically actuated and hydro-mechanical products. They are designed to be able to operate reliably at higher pressures than most competitors, making them equally suitable for both industrial and mobile applications.
Hydraulic systems are increasingly taking signals from on-board electronic control systems, making it necessary for hydraulic products to be capable of digital communication. In response to this the company has aggressively expanded its CVT offering of electrically actuated cartridge valves for both the mobile and industrial hydraulics markets and gained significant technology advancements in electro-hydraulic products in addition to parts-in-body and directional control valves with the acquisition of NEM.
Additionally, the company’s CVT ecoline family is a collection of products focused on increasing the energy efficiency of hydraulic systems. Also, an aggressive segment of new product development that focuses on disruptive technology is yielding results with the announcement of the ENERGEN product. ENERGEN is the first hydraulic cartridge valve with the capability to convert hydraulic flow into electrical power. The Sun Common line was introduced in 2022 to offer products better positioned for simpler, lower pressure applications.
The company’s FCT products transfer hydraulic fluid from one point to another. FCT includes the company’s quick release couplings (‘QRC’) products, which allow users to connect and disconnect quickly from any hydraulic circuit without leakage and ensure high-performance under high temperature and pressure using one or multiple couplers. Quick connection of multiple hydraulic lines can be accomplished through the use of the company’s casting solution or its signature MultiFaster product line. In particular, the simultaneous connection of several lines granted by the company’s Multifaster is an important feature in many applications and allows for dramatic reduction of connection time, even when the system is under pressure, and completely removes the risk of incorrect connections and related hazards for the equipment and the operators.
The company designs, engineers and distributes hydraulic coupling solutions primarily in the agriculture, construction equipment and industrial markets. In 2021, the company’s QRC subsidiary, Faster S.r.l, was selected as a recipient of the John Deere Supplier Innovation Award for 2020, for its multi-connection couplings with integrated valve system. The award was presented to a select group of Suppliers who demonstrated innovation in a product or service they provide to John Deere. Award selections are based on four factors: creativity, feasibility, collaboration and bottom-line impact. In synergy with the company’s Sun Hydraulics LLC business, the company’s engineering teams have combined the advantages and features of MultiFaster and Sun electro-hydraulic cartridge valves into an integrated manifold, reducing complexity and increasing reliability of the hydraulic circuit as a result.
The company’s recent strategic acquisitions have expanded the company’s addressable markets by gaining know-how and intellectual property, which grant the company access into industrial multi-connections, mostly automatically actuated, in fields like steel mills, automotive engine test beds, aeronautics and plastic injection. These multi-connections are typically custom designed for a particular application and handle not just hydraulic, but also various process fluids and electrical signals of low, medium and high voltage. In addition, the Taimi acquisition was a bolt-on technology that fits well with the company’s coupling offerings. Taimi developed a hose line accessory with innovative technology granting superior life and performance, not just for the swivel itself but effectively expanding the hose life by up to ten times in heavy duty applications where hose bending and torsion under severe pressure conditions are normal. This expanded the company’s market reach into mining, forestry equipment and high-end sailing solutions.
Many of the Faster, Taimi, Sun and NEM brand products can be easily combined to form an integrated hydraulic circuit, or system, of high technological content.
These circuits and systems provide engineered solutions that combine manifolds, CVT and QRC technology and allow users enhanced control of existing equipment, providing a competitive advantage and opportunities for higher margin. The systems the company designs and manufactures may include electro-hydraulic, remote control, electronic control, hydraulic machine control and human-machine interface (‘HMI’) display interfaces; are highly efficient; increase and optimize productivity; introduce safer operating procedures; are smaller in size than competitive products; allow for automation of existing equipment; and allow for ease of maintenance.
Electronics
The company is an international leader in custom-tailored solutions for many industrial and commercial applications, including engines, engine-driven equipment and specialty vehicles with a broad range of rugged and reliable instruments, such as displays, controls and instrumentation products through the company’s Enovation Controls, Zero Off, Murphy and HCT brands. With the Balboa and Joyonway brands, the company is also an industry leader in the health and wellness market providing globally comprehensive electronic control systems with proprietary and patented technology for therapy bath and traditional and swim spas from a single source.
As an innovative manufacturer of electronic controls and displays, the company serves a variety of markets, including off-highway, recreational marine, powersports and specialty vehicles, agriculture, water pumping, power generation, engine-driven industrial equipment, and health and wellness. The company partners directly with OEMs and support a worldwide network of authorized distributors and systems integrators.
The company’s focus is on creating customized systems that solve complex problems for niche mid-market volume customers. This allows the company to target customers or industries that see value in this level of integration, and as a result, the company’s product list contains a wide variety of OEM applications. Product categories include traditional mechanical and electronic gauge instrumentation, plug and go CAN-based instruments, robust environmentally sealed controllers, hydraulic controllers, pumps and water flow systems, engineered panels, process monitoring instrumentation, printed circuit board assembly and wiring harness design. The company’s technologies can be used in both mobile (DC power applications), as well as fixed (AC power applications), enabling the company to provide products and services across a broad base of applications.
The company’s PowerView and next generation OpenView lines of LCD displays offer its customers the ability to work with the company’s engineering teams to specify and utilize customized software and graphics for their electronics solutions. The company’s OpenView displays include the same robust features and quality of the company’s PowerView displays while also allowing the company’s customers the ability to use open source Linux-based operating system and various software development tools to create their own graphics and custom applications for their electronics solutions making implementation of OpenView products more adoptable and flexible for the company’s customers. All of the company’s displays offer easy-to-read, bonded LCD graphical interfaces with the industry's best viewability, even in direct sunlight or harsh weather conditions, and the ability to withstand a wide ambient temperature range. The company’s user friendly software configuration tools allow engineers and non-engineers alike to create customized systems to solve complex problems on their equipment making the user experience more seamless.
The company’s panel solutions offer customized design and simple, turnkey solutions and the company’s Custom Hardware Solutions team offers engineers dedicated to applications, wire harnesses, panels and software development. Engineers focus entirely on custom and standard solutions built to desired specifications. The company’s services for design and development include on-site installation and testing with reviews to ensure the solution works with the application out of the box.
Technology and Innovation
In 2021, the company established the Helios Center of Engineering Excellence (‘HCEE’) to serve both the Electronics and Hydraulics segments of Helios. HCEE plays an important role in protecting the business, market diversification, globalization and innovation of products and developing talent. Importantly, HCEE advances ongoing joint product development efforts to address the megatrend of the electrification of machines.
HCEE teams work cross functionally between the segments where engineers in the Electronics segment bring expertise to enable electrification of products and systems within the Hydraulics segment.
Manufacturing
Strategy
As part of the company’s transformation to an integrated operating company, the company has developed a unified operations strategy across the companies in its Electronics and Hydraulics segments. This strategy leverages the breadth of the company’s global footprint and depth of the company’s manufacturing capabilities.
Established manufacturing centers provide scale in North America, and the company continues to expand centers in both Asia and Europe to meet growing global demand. Manufacturing locations in the U.S., Canada, Mexico, Italy, Germany, South Korea, China and India provide a range of manufacturing options.
Hydraulics
The company’s Hydraulics operations footprint leverages manufacturing centers in North America, Europe, and Asia. Established supplier relationships and manufacturing capabilities in precision machining, finishing, heat treatment, process automation, and test allow the company to deliver quality and market leading hydraulic control solutions.
The company leverages Lean Six Sigma best practices and automation to continually improve the safety, quality, and productivity of the company’s operating processes.
Electronics
The company offers a wide range of advanced electronics manufacturing capabilities that deliver integrated electronic control solutions to diverse end markets. Manufacturing value streams incorporate high speed surface mount technology (‘SMT’), production lines with 3D solder paste inspection, 3D automated optical inspection and x-ray inspection to ensure quality and process control. Multipoint functional testing is conducted to ensure quality control of assembled products. Products are serialized and test data is captured against serial numbers and stored in a manufacturing execution system (‘MES’) database for product traceability.
Strategy
One of the key drivers of future growth for both the Electronics and Hydraulics segments is the company’s system sale approach that leverages electronic and hydraulic solutions from the company’s trusted brands.
The company’s two segments are consisted of approximately 125 direct sales and application specialists serving the company’s customers’ needs.
Hydraulics
In 2023, 68% of Helios’ sales were derived from the Hydraulics segment. The company’s 2023 Hydraulics segment sales were distributed fairly evenly among the company’s three major geographic regions with 42% to the Americas; 31% to Europe, the Middle East and Africa (‘EMEA’); and 27% to the Asia Pacific (‘APAC’).
The company markets and sells hydraulic products and engineered solutions through value-add distributors and directly to OEMs. The company’s global channel partner network includes representation in many industrialized markets, and approximately 46% of segment sales are attributed to the company’s channel partners who generally combine the company’s products with other hydraulic components to design a complete hydraulic system. Sales direct to OEMs for integration in their machines make up the remaining 54%. The company relies heavily on its distribution network in the U.S., while in the EMEA and APAC regions, sales are split more evenly between OEMs and distributors. Technical support is provided by local sales and application experts based in each region.
Electronics
Electronic products are sold globally to OEM customers, distributors and system integrators. OEM sales constituted 75% of total Electronics segment sales in 2023. Building strong, lasting partnerships with OEMs is a priority. The company relies on direct customer contacts to stimulate demand for its products. The company works with its OEM customers to design and deliver products for specific applications. The company’s hardware and software products are designed and modified with the customer utilizing the company’s extensive application knowledge to create unique system level products that cannot be easily replaced by simply switching out components. Customer service support and an in-house technical service department is available before, during and after the initial sale to create sustainable partnerships with the company’s customers. OEM customers continue to specify the company’s products in new projects based on the high level of engagement, quality products and delivery performance.
The company’s OEM sales team collaborates with large OEMs, whereas the distributor sales team works with an expanding number of distributors of varying sizes. Over the last few years, the company restructured its sales teams to create a more dedicated focus on distributor sales. Overall, approximately 25% of 2023 segment sales were derived from independent authorized distributor channel partners.
The company continues to execute on its strategic initiative to further diversify the company’s channels to market and end markets served. In addition to acquisitions, such as Balboa and Joyonway, this effort includes the development of new partners globally.
The company’s new product initiatives in the Electronics Segment are focused on general market products that will require less customization by the company’s engineering teams and provide a quicker sales cycle, making it easier for the products to be utilized in multiple new end markets and OEM applications.
Geographically, the company’s 2023 Electronics segment sales represented 84% to the Americas, 9% to EMEA, and 7% to APAC. There is a well-defined initiative to grow sales in EMEA and APAC as part of the company’s growth strategy. Additionally, synergies identified at the time of acquisition utilize customer relationships from the Hydraulics segment to create pull through of electronic products, and joint product development has created additional sales opportunities for both segments.
Patents and Trademarks
The company owns approximately 300 active patents and trademarks relating to certain of the company’s products and businesses.
Governmental Regulations
The company is subject to the U.S. Foreign Corrupt Practices Act (‘FCPA’) and anti-corruption laws, and similar laws in foreign countries, such as the U.K. Anti-Bribery Act of 2010.
The company is subject to numerous domestic and foreign regulations relating to the company’s operations worldwide. In particular, the company is subject to trade and import and export regulations in multiple jurisdictions, including sanctions administered by the Office of Foreign Asset Controls of the U.S. Treasury Department (OFAC).
The company's operations are subject to extensive and stringent governmental regulations, including regulations related to the Occupational Safety and Health Act (‘OSHA’) and similar safety and health regulations promulgated in other countries. The company's manufacturing locations are subject to the workplace safety rules and regulations of OSHA and local safety and health laws.
Research and Development
The company’s research and development costs totaled $19.2 for 2023.
History
The company was founded in 1970. It was incorporated in 1970. The company was formerly known as Sun Hydraulics Corporation and changed its name to Helios Technologies, Inc. in 2019.
