10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

	Form 10-K
☑	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934
	For the Fiscal Year Ended	April 3, 2022
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934
	Commission File No. 0-7647

HAWKINS, INC.

(Exact Name of Registrant as Specified in its Charter)

Minnesota	41-0771293
(State of Incorporation)	(I.R.S. Employer Identification No.)
2381 Rosegate, Roseville, Minnesota	55113
(Address of Principal Executive Offices)	(Zip Code)

(612) 331-6910

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol:	Name of exchange on which registered:
Common Shares, par value $.01 per share	HWKN	Nasdaq Stock Market LLC
Securities registered pursuant to Section 12(g) of the Act:    None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☑    No  ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ☐    No  ☑

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☑    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).    Yes  ☑    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.   ☑   

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☑

The aggregate market value of voting stock held by non-affiliates of the Registrant on September 26, 2021 (the last business day of the Registrant’s most recently completed second fiscal quarter) was approximately $706.8 million based upon the closing sale price for the Registrant’s common shares on that date as reported by The Nasdaq Stock Market LLC, excluding all shares held by officers and directors of the Registrant and by the Trustees of the Registrant’s Employee Stock Ownership Plan and Trust.

As of May 13, 2022, the Registrant had 21,078,132 shares of common shares outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of our definitive Proxy Statement for the annual meeting of shareholders to be held August 3, 2022, are incorporated by reference in Part III of this Annual Report on Form 10-K

FORWARD-LOOKING STATEMENTS

The information presented in this Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements have been made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. These statements are not historical facts, but rather are based on our current expectations, estimates and projections, and our beliefs and assumptions. Words such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will” and similar expressions may identify forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. These factors could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. These risks and uncertainties are described in the risk factors and elsewhere in this Annual Report on Form 10-K. We caution you not to place undue reliance on these forward-looking statements, which reflect our management’s view only as of the date of this Annual Report on Form 10-K. We are not obligated to update these statements or publicly release the result of any revisions to them to reflect events or circumstances after the date of this Annual Report on Form 10-K or to reflect the occurrence of unanticipated events.

As used in this Annual Report on Form 10-K, except where otherwise stated or indicated by the context, “Hawkins,” “we,” “us,” “the Company,” “our,” or “the Registrant” means Hawkins, Inc. References to "fiscal 2023" means our fiscal year ending April 2, 2023, “fiscal 2022” means our fiscal year ended April 3, 2022, “fiscal 2021” means our fiscal year ended March 28, 2021, “fiscal 2020” means our fiscal year ended March 29, 2020, and “fiscal 2019” means our fiscal year ended March 31, 2019.

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Hawkins, Inc.

Annual Report on Form 10-K

For the Fiscal Year Ended April 3, 2022

 

		Page
PART I
ITEM 1.	Business	1
ITEM 1A.	Risk Factors	4
ITEM 1B.	Unresolved Staff Comments	11
ITEM 2.	Properties	12
ITEM 3.	Legal Proceedings	12
ITEM 4.	Mine Safety Disclosures	12
PART II
ITEM 5.	Market for the Company’s Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities	13
ITEM 6.	Reserved	14
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
ITEM 7A.	Quantitative and Qualitative Disclosures about Market Risk	21
ITEM 8.	Financial Statements and Supplementary Data	22
ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	48
ITEM 9A.	Controls and Procedures	48
ITEM 9B.	Other Information	49
ITEM 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	49
PART III
ITEM 10.	Directors, Executive Officers, and Corporate Governance	50
ITEM 11.	Executive Compensation	51
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management And Related Stockholder Matters	51
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	51
ITEM 14.	Principal Accountant Fees and Services	51
PART IV
ITEM 15.	Exhibits and Financial Statement Schedules	52
ITEM 16.	Form 10-K Summary	54

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PART I

ITEM 1. BUSINESS

We are a leading specialty chemical and ingredients company that formulates, distributes, blends and manufactures products for our Industrial, Water Treatment and Health and Nutrition customers. We believe that we create value for our customers through superb service and support, quality products, personalized applications and trustworthy, creative employees.

We conduct our business in three segments: Industrial, Water Treatment, and Health and Nutrition.

Industrial Segment.  Our Industrial Group specializes in providing industrial chemicals, products and services to industries such as agriculture, chemical processing, electronics, energy, food, pharmaceutical and plating. This group’s principal products are acids, alkalis and food-grade and pharmaceutical salts and ingredients.

The Industrial Group:

•Manufactures sodium hypochlorite (bleach), agricultural products and certain food-grade and pharmaceutical products, including liquid phosphates, lactates and other blended products;

•Receives, stores and distributes various chemicals in bulk quantities, including liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia and potassium hydroxide;

•Repackages water treatment chemicals for our Water Treatment Group and bulk industrial chemicals to sell in smaller quantities to our customers;

•Performs custom blending of chemicals according to customer formulas and specifications; and

•Performs contract and private label bleach packaging.

The group’s sales are concentrated primarily in the central United States, while the group’s products sold into the food and pharmaceutical markets are sold nationally. The Industrial Group relies on a specially trained sales staff that works directly with customers on their specific needs. The group conducts its business primarily through manufacturing locations and terminal operations. Agricultural sales within this group tend to be seasonal, with higher sales due to the application of fertilizer during the planting season of March through June given the regions of the country where we are located.

Water Treatment Segment.  Our Water Treatment Group specializes in providing chemicals, products, equipment, services and solutions for potable water, municipal and industrial wastewater, industrial process water, non-residential swimming pool water and agricultural water. This group has the resources and flexibility to treat systems ranging in size from a single small well to a multi-million-gallon-per-day facility.

The group utilizes delivery routes operated by our employees who typically serve as route driver, salesperson and trained technician to deliver our products and diagnose our customers’ water treatment needs. We believe that the high level of service provided by these individuals allows us to serve as the trusted water treatment expert for many of the municipalities and other customers that we serve. We also believe that there are significant synergies between our Water Treatment and Industrial Groups in that we are able to obtain a competitive cost position on many of the chemicals sold by the Water Treatment Group due to the volumes of these chemicals purchased by our Industrial Group. In addition, our Industrial and Water Treatment groups share certain resources, which leverage fixed costs across both groups.

The Water Treatment group operates out of 37 warehouses supplying products and services to customers primarily in the central United States, and along the south from Florida to Texas. In fiscal 2022, we added four locations, all by acquisition. We expect to invest in existing and new branches to expand the group’s geographic coverage. Our Water Treatment Group has historically experienced higher sales during April to September, primarily due to a seasonal increase in chemicals used by municipal water treatment facilities.

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Health and Nutrition Segment. Our Health and Nutrition Group specializes in providing ingredient distribution, processing and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, health and wellness products. This group offers a diverse product portfolio including minerals, vitamins and amino acids, excipients, joint products, botanicals and herbs, sweeteners and enzymes.

The Health and Nutrition Group relies on a specially trained sales and product development staff that works directly with customers on their specific needs. The group’s extensive product portfolio combined with value-added services, including product formulation, sourcing and distribution, processing and blending and quality control and compliance, positions this group as a one-stop ingredient solutions provider to its customers. The group operates out of facilities in California and New York and its products are sold nationally and, in certain cases, internationally.

Raw Materials.  We have numerous suppliers, including many of the major chemical producers in the United States. We source our health and nutrition ingredients from a wide array of domestic and international vendors. We typically have distributorship agreements or supply contracts with our suppliers that are periodically renewed. We believe that most of the products we purchase can be obtained from alternative sources should existing relationships be terminated. We are dependent upon the availability of our raw materials. While we believe that we have adequate sources of supply for our raw material and product requirements, we cannot be sure that supplies will be consistently available in the future. In the event that certain raw materials become generally unavailable, suppliers may extend lead times or limit or cut off the supply of materials to us. As a result, we may not be able to supply or manufacture products for our customers.

Intellectual Property.  Our intellectual property portfolio is of economic importance to our business. When appropriate, we have pursued, and we will continue to pursue, patents covering our products. We also have obtained certain trademarks for our products to distinguish them from our competitors’ products. We regard many of the formulas, information and processes that we generate and use in the conduct of our business as proprietary and protectable under applicable copyright, patent, trademark, trade secret and unfair competition laws.

Customer Concentration.  In fiscal 2022, none of our customers accounted for 10% or more of our total sales.

Competition.  We operate in a competitive industry and compete with many producers, distributors and sales agents offering products equivalent to substantially all of the products we offer. Many of our competitors are larger than we are and may have greater financial resources, although no one competitor is dominant in all of the markets we serve. We compete by offering quality products with outstanding customer service at competitive prices coupled with value-added services or product formulation where needed. Because of our long-standing relationships with many of our suppliers, we are often able to leverage those relationships to obtain products when supplies are limited or to obtain competitive pricing.

Working Capital. Due to the nature of our operations, which includes purchases of large quantities of bulk chemicals, the timing of purchases can result in significant changes in working capital and the resulting operating cash flow. Historically, our cash requirements for working capital increase during the period from March through November as caustic soda inventory levels increase with most of our barges received during this period.

Regulatory Matters. We are subject to numerous federal, state and local environmental, health and safety laws and regulations in the jurisdictions in which we operate, including the management, storage, transportation and disposal of chemicals and wastes; product regulation; air water and soil contamination; and the investigation and cleanup of any spills or releases that may result from our management, handling, storage, sale, or transportation of chemicals and other products. In addition, societal concerns regarding the safety of chemicals in commerce and their potential impact on the environment have resulted in a growing trend towards increasing levels of product safety and environmental protection regulations. These concerns have led to, and could continue to result in, more stringent regulatory intervention by governmental authorities.

In addition, we operate a fleet of more than 200 commercial vehicles, primarily in our Water Treatment Group, which are highly regulated, including by the U.S. Department of Transportation (“DOT”). The DOT governs transportation matters including authorization to engage in motor carrier service, including the necessary permits to conduct our businesses, equipment operation, and safety.

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The manufacture, packaging, labeling, advertising, promotion, distribution and sale of our agricultural, food, pharmaceutical, pesticide and health and nutrition products are subject to regulation by numerous national and local governmental agencies in the United States and other countries. The primary regulatory bodies in the United States are the Food and Drug Administration (the “FDA”), the Environmental Protection Agency, the United States Department of Agriculture and the Federal Trade Commission, and we are also subject to similar regulators in other countries. In particular, the FDA’s current good manufacturing practices (“GMPs”) describe policies and procedures designed to ensure that nutraceuticals, pharmaceuticals and dietary supplements are produced in a quality manner, do not contain contaminants or impurities, and are accurately labeled and cover the manufacturing, packaging, labeling and storing of supplements, with requirements for quality control, design and construction of manufacturing plants, testing of ingredients and final products, record keeping, and complaints processes.

Further information related to government regulation applicable to our business is included in this Annual Report on Form 10-K, in Part I, Item 1A - Risk Factors.

Human Capital. Our team is a key to our success and we are committed to creating a workplace that attracts top talent, develops leaders and drives performance on behalf of our customers and shareholders.

We strive to recruit the best people for the job regardless of race, color, nationality, gender, age, disability, sexual orientation or any other status protected by law. It is our policy to comply fully with all applicable laws relating to discrimination in the workplace and are committed to advancing an inclusive, collaborative and respectful culture.

The health and safety of our employees is our highest priority. We work to ensure our employees have a thorough understanding of health and safety precautions that need to be taken in all business functions. Specific safety initiatives include accident prevention work, improving process controls, safety training, safety committees, safety audits, incident investigation and improvement measures.

We have ensured the safety of our employees and our customers during the COVID-19 pandemic by implementing contingency and continuity plans to respond quickly and appropriately to identified risks, safe work practices in accordance with the guidance provided by the US Centers for Disease Control and Prevention ("CDC"). Through communication, enhanced resources and leadership, we were able to support our employees, serve our customers and keep our facilities operating and safe during the pandemic.

We strive to provide employees with competitive wages commensurate with their skill levels, experience, knowledge and the regional market. Full-time employees are eligible for health, dental and vision insurance, paid and unpaid leaves, 401(K) plan, retirement plans, life and disability/accident coverage and our employee assistance program.

As of April 3, 2022, we had 813 employees across the United States, of which 807 were full-time employees,. Approximately 38% of our employees were female or racially and ethnically diverse, and approximately 10% were covered by a collective bargaining agreement. Of the eight members of our Board of Directors, two are female, six are male, one is Asian American and seven are white.

Available Information.  Our Internet address is www.hawkinsinc.com. We have made available, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable, amendments to those reports, as soon as reasonably practicable after we electronically file these materials with, or furnish them to, the Securities and Exchange Commission. Reports of beneficial ownership filed by our directors and executive officers pursuant to Section 16(a) of the Exchange Act are also available on our website. We are not including the information contained on our website as part of, or incorporating it by reference into, this Annual Report on Form 10-K. The SEC also maintains an internet site that contains reports, proxy and information statements, and other information regarding our company at http://www.sec.gov.

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ITEM 1A. RISK FACTORS

You should consider carefully the following material factors regarding risks relating to an investment in our securities and when reading the information, including the financial information, contained in this Annual Report on Form 10-K. Shareholders are cautioned that these and other factors may affect future performance and cause actual results to differ materially from those that may be anticipated.

COMPETITIVE AND REPUTATIONAL RISKS

We operate in a highly competitive environment and face significant competition and price pressure.

We operate in a highly competitive industry and compete with producers, manufacturers, distributors and sales agents offering products equivalent to substantially all of the products we offer. Competition is based on several key criteria, including product price, product performance, product quality, product availability and security of supply, breadth of product offerings, geographic reach, responsiveness of product development in cooperation with customers, technical expertise and customer service. Many of our competitors are larger than we are and may have greater financial resources, more product offerings and a broader geographic reach. As a result, these competitors may be able to offer a broader array of products to a larger geographic area and may be better able than us to withstand changes in conditions within our industry, changes in the prices and availability of raw materials and changes in general economic conditions as well as be able to introduce innovative products that reduce demand for or the profit from our products. Additionally, competitors’ pricing decisions could compel us to decrease our prices, which could adversely affect our margins and profitability. Our ability to maintain or increase our profitability would be dependent upon our ability to offset competitive decreases in the prices and margins of our products by improving production efficiency, investing in infrastructure to reduce freight costs, identifying and selling higher margin products, providing higher levels of technical expertise and customer service, and improving existing products through innovation and research and development. If we are unable to maintain our profitability or competitive position, we could lose market share to our competitors and experience reduced profitability.

Our businesses expose us to potential product liability claims and recalls, which could adversely affect our financial condition and performance.

The repackaging, blending, mixing and distribution of products by us, including chemical products and products used in food or food ingredients or with medical, pharmaceutical or dietary supplement applications, involve an inherent risk of exposure to product liability claims, product recalls, product seizures and related adverse publicity, including, without limitation, claims for exposure to our products, spills or release of our products, personal injuries, food-related claims and property damage or environmental claims. A product liability claim, judgment or recall against our customers could also result in substantial and unexpected expenditures for us, affect consumer confidence in our products and divert management’s attention from other responsibilities. Although we maintain product liability insurance, there can be no assurance that the type or level of coverage is adequate or that we will be able to continue to maintain our existing insurance or obtain comparable insurance at a reasonable cost, if at all. A product recall or a partially or completely uninsured judgment against us could have a material adverse effect on our business, financial condition and results of operations.

Changes in our customers’ needs or failure of our products to meet customers’ specifications could adversely affect our sales and profitability.

Our products are used for a broad range of applications by our customers. Changes in our customers’ product needs or processes, or reductions in demand for their end products, may enable or require our customers to reduce or eliminate consumption of the products that we provide. Customers may also find alternative materials or processes that no longer require our products. Consequently, it is important that we develop new products to replace the sales of products that mature and decline in use.

Our products provide important performance attributes to our customers’ products. If our products fail to meet the customers’ specifications or comply with applicable laws or regulations, perform in a manner inconsistent with the customers’ expectations or have a shorter useful life than required, a customer could seek replacement of the product or damages for costs incurred as a result of the product failure. A successful claim or series of claims against us could have a material adverse effect on our financial condition and results of operations and could result in a loss of one or more customers. Reductions in demand for our products could adversely affect our sales and financial results and result in facility closures.

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Adverse publicity or negative public perception regarding particular ingredients or products or the dietary supplement industry in general could adversely affect the financial performance of those portions of our business.

Purchasing decisions made by consumers of products that contain our ingredients may be affected by adverse publicity or negative public perception regarding particular ingredients or products or the dietary supplement industry in general. This negative public perception may include publicity regarding the risks, efficacy, legality or quality of particular ingredients or products in general or of other companies or our products or ingredients specifically. Negative public perception may also arise from regulatory investigations, regardless of whether those investigations involve us. We are highly dependent upon consumers’ perception of the safety and quality of products that contain our ingredients as well as similar products distributed by other companies. Thus, the mere publication of reports asserting that such products may be harmful could have a material adverse effect on us, regardless of whether these reports are scientifically supported. Publicity related to dietary supplements or food ingredients may also result in increased regulatory scrutiny of our industry. Adverse publicity may have a material adverse effect on our business, financial condition, results of operations and cash flows.

Failure to adequately protect critical data and technology systems could materially affect our operations.

Information technology system failures, network disruptions and breaches of data security due to internal or external factors including phishing or cyber-attacks could disrupt our operations by causing delays or cancellation of customer orders, impede the manufacture or shipment of products or cause standard business processes to become ineffective, resulting in the unintentional disclosure of information or damage to our reputation. While we have taken steps to address these concerns by implementing network security and internal control measures, including employee training, comprehensive monitoring of our networks and systems, maintenance of backup and protective systems and disaster recovery and incident response plans, our employees, systems, networks, products, facilities and services remain vulnerable to phishing attacks and cyber-assault, and, as such, there can be no assurance that a system failure, network disruption or data security breach will not have a material adverse effect on our business, financial condition, operating results or cash flows.

RISKS RELATED TO OUR INDUSTRY

Fluctuations in the prices and availability of our raw materials, which may be cyclical in nature, could have a material adverse effect on our operations and the margins we receive on sales of our products.

We experience regular and recurring fluctuations in the pricing of our raw materials. Those fluctuations can be significant and occur rapidly. The cyclicality of commodity markets, such as the market for caustic soda, primarily results from changes in the balance between supply and demand and the level of general economic activity. We cannot predict whether the markets for our raw materials will favorably impact or negatively impact the margins we can realize.

The prices we pay for our principal chemical raw materials generally lag the market prices of the underlying raw material. The cost of inventory we have on hand, particularly inventories of our bulk commodity chemicals where we have significant volumes stored at our facilities, generally will lag the current market pricing of such inventory. The pricing within our supply contracts generally adjusts quarterly or monthly. While we attempt to maintain competitive pricing and stable margin dollars, the potential variance in our cost of inventory from the current market pricing can cause significant volatility in our margins realized. We do not engage in futures or other derivatives contracts to hedge against fluctuations in future prices. We may enter into sales contracts where the selling prices for our products are fixed for a period of time, exposing us to volatility in raw materials prices that we acquire on a spot market or short-term contractual basis. We attempt to pass commodity pricing changes to our customers, but we may be unable to or be delayed in doing so. Our inability to pass through price increases or any limitation or delay in our passing through price increases could adversely affect our profit margins.

We are also dependent upon the availability of our raw materials. In the event that raw materials are in short supply or unavailable, raw material suppliers may extend lead times or limit or cut off supplies. As a result, we may not be able to supply or manufacture products for some or all of our customers. Constraints on the supply or delivery of critical raw materials could disrupt our operations and adversely affect the performance of our businesses.

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Demand for our products is affected by general economic conditions and by the cyclical nature of many of the industries we serve, which could cause significant fluctuations in our sales volumes and results.

Demand for our products is affected by general economic conditions. A decline in general economic or business conditions in the industries served by our customers could have a material adverse effect on our businesses. Although we sell to areas traditionally considered non-cyclical, such as water treatment, food products and health and nutritional ingredients, many of our customers are in businesses that are cyclical in nature, such as the industrial manufacturing and energy industries which include the ethanol and agriculture industries. Downturns in these industries could adversely affect our sales and our financial results by affecting demand for and pricing of our products.

Our business is subject to hazards common to chemical businesses, any of which could interrupt our production and adversely affect our results of operations.

Our business is subject to hazards common to chemical manufacturing, blending, storage, handling and transportation, including explosions, fires, severe weather, natural disasters, mechanical failure, unscheduled downtime, transportation interruptions, traffic accidents involving our delivery vehicles, chemical spills, discharges or releases of toxic or hazardous substances or gases and other risks. These hazards could cause personal injury and loss of life, severe damage to or destruction of property and equipment, and environmental contamination. In addition, the occurrence of material operating problems or the absence of personnel due to pandemics or other disasters at any of our facilities due to any of these hazards may make it impossible for us to make sales to our customers and may result in a negative public or political reaction. Many of our facilities are near significant residential populations which increases the risk of negative public or political reaction should an environmental issue occur and could lead to adverse zoning or other regulatory actions that could limit our ability to operate our business in those locations. Accordingly, these hazards and their consequences could have a material adverse effect on our operations as a whole, including our results of operations and cash flows, both during and after the period of operational difficulties.

Environmental problems at any of our facilities could result in significant unexpected costs.

We are subject to federal, state and local environmental regulations regarding the ownership of real property and the operations conducted on real property. Under various federal, state and local laws, ordinances and regulations, we may own or operate real property or may have arranged for the disposal or treatment of hazardous or toxic substances at a property and, therefore, may become liable for the costs of removal or remediation of certain hazardous substances released on or in our property or disposed of by us, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). Such liability may be imposed whether or not we knew of, or were responsible for, the presence of these hazardous or toxic substances. Further, future changes in environmental laws or regulations may require additional investment in capital equipment or the implementation of additional compliance programs in the future. The cost of investigation, remediation or removal of such substances may be substantial.

In the conduct of our operations, we have handled and do handle materials that are considered hazardous, toxic or volatile under federal, state and local laws. The accidental release of such products cannot be completely eliminated. In addition, we operate or own facilities located on or near real property that was formerly owned and operated by others. These properties may have been used in ways that involved hazardous materials. Contaminates may migrate from, within or through any such property, which may give rise to claims against us. Third parties who are responsible for contamination may not have funds, or may not make funds available when needed, to pay remediation costs imposed upon us jointly with them under environmental laws and regulations.

Our Water Treatment Group and our agricultural product sales within our Industrial Group are subject to seasonality and weather conditions, which could adversely affect our results of operations.

Our Water Treatment Group has historically experienced higher sales during April to September, primarily due to a seasonal increase in chemicals used by municipal water treatment facilities. Our agricultural product sales within our Industrial Group are also seasonal, primarily corresponding with the planting season. Demand in both of these areas is also affected by weather conditions, as either higher or lower than normal precipitation or temperatures may affect water usage and the timing and the amount of consumption of our products. We cannot assure you that seasonality or fluctuating weather conditions will not have a material adverse effect on our results of operations.

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OPERATIONAL RISKS

Disruptions within our supply chain have negatively impacted, and could continue to negatively impact, our production, financial condition and results of operations.

We have been, and could continue to be, adversely affected by disruptions within our supply chain and transportation network. The raw materials we need are transported by truck, rail, barge or ship by third-party providers. The costs of transporting our products or necessary raw materials could be negatively affected by factors outside of our control, including rail service interruptions or rate increases, extreme weather events, tariffs, rising fuel costs and capacity constraints. Recently, the unprecedented congestion in ocean shipping has, and will continue to, adversely impact the reliability of our imported raw materials, and transport driver shortages have caused extended lead times for domestic shipments. In addition, rail shipments have become increasingly unreliable, with significant delays in service and increased costs. Significant delays or increased costs relating to transportation could materially affect our financial condition and results of operations.

Similar supply chain issues have impacted and could continue to impact both our suppliers and our customers. The supply of our necessary raw materials could be interrupted due to shortages of raw materials, effects of economic, political or financial market conditions on a supplier's operations, labor disputes or weather conditions affecting products or shipments, transportation disruptions, natural disasters, outbreaks of disease, information system disruptions or other reasons beyond our control. Similar disruptions at our customers could reduce demand for our products, reducing our sales and profitability. Product shortages or delays in deliveries, along with other factors such as price inflation and higher transportation costs, have also resulted in price increases from our suppliers. We may be unable to pass these price increases on to our customers, which could erode our profit margins. These supply chain constraints, increased product costs and inflationary pressures could continue or escalate in the future, which would have an adverse impact on our business and results of operations.

We are highly dependent upon transportation infrastructure to ship and receive our products and delays in these shipments could adversely affect our results of operations.

Although we maintain a number of owned trucks and trailers, we rely heavily upon transportation provided by third parties (including common carriers, barge companies, rail companies and trans-ocean cargo companies) to deliver products to us and to our customers. Our access to third-party transportation is not guaranteed, and we may be unable to transport our products in a timely manner, or at all, in certain circumstances, or at economically attractive rates. Disruptions in transportation are common, are often out of our control, and can happen suddenly and without warning. Rail limitations, such as limitations in rail capacity, availability of railcars, workforce shortages and adverse weather conditions have disrupted or delayed rail shipments in the past and could do so in the future. Barge shipments are delayed or impossible under certain circumstances, including during times of high or low water levels, when waterways are frozen and when locks and dams are inoperable. The availability and reliability of truck transportation has been negatively impacted by a number of factors, including limited availability of qualified drivers and equipment, and limitations on drivers’ hours of service. The volumes handled by, and operating challenges at, ocean ports have at times been volatile and can delay the receipt of goods, or cause the cost of shipping goods to be more expensive. Our failure to ship or receive products in a timely and efficient manner could have a material adverse effect on our financial condition and results of operations.

If we are unable to retain key personnel or attract new skilled personnel, it could have an adverse impact on our businesses.

Because of the specialized and technical nature of our businesses, our future performance is dependent on the continued service of, and on our ability to attract and retain, qualified management, scientific, technical and support personnel. The unanticipated departure of key members of our management team could have an adverse impact on our business.

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We may not be able to successfully consummate future acquisitions or dispositions or integrate acquisitions into our business, which could result in unanticipated expenses and losses.

As part of our business growth strategy, we have acquired businesses and may pursue acquisitions in the future. Our ability to pursue this strategy will be limited by our ability to identify appropriate acquisition candidates and our financial resources, including available cash and borrowing capacity. In addition, we may seek to divest of businesses that are underperforming or not core to our future business. The expense incurred in consummating transactions, the time it takes to integrate an acquisition or our failure to integrate businesses successfully could result in unanticipated expenses and losses. Furthermore, we may not be able to realize the anticipated benefits from acquisitions.

The process of integrating acquired operations into our existing operations may result in unforeseen operating difficulties and may require significant financial resources that would otherwise be available for the ongoing development or expansion of existing operations. The risks associated with the integration of acquisitions include potential disruption of our ongoing businesses and distraction of management, unforeseen claims, liabilities, adjustments, charges and write-offs, difficulty in conforming the acquired business’ standards, processes, procedures and controls with our operations, and challenges arising from the increased scope, geographic diversity and complexity of the expanded operations.

Our businesses are subject to risks stemming from natural disasters or other extraordinary events outside of our control, which could interrupt our production and adversely affect our results of operations.

Natural disasters have the potential of interrupting our operations and damaging our properties, which could adversely affect our businesses. Flooding of the Mississippi River has temporarily shifted the Company’s terminal operations out of its buildings four times since the spring of 2010, including most recently the spring of 2019. We can give no assurance that flooding or other natural disasters will not recur or that there will not be material damage or interruption to our operations in the future from such disasters.

Chemical-related assets may be at greater risk of future terrorist attacks than other possible targets in the United States. Federal law imposes site security requirements, specifically on chemical facilities, which have increased our overhead expenses. Federal regulations have also been adopted to increase the security of the transportation of hazardous chemicals in the United States. We ship and receive materials that are classified as hazardous and we believe we have met these requirements, but additional federal and local regulations that limit the distribution of hazardous materials are being considered. Bans on movement of hazardous materials through certain cities could adversely affect the efficiency of our logistical operations. Broader restrictions on hazardous material movements could lead to additional investment and could change where and what products we provide.

The occurrence of extraordinary events, including future terrorist attacks, wars, global health developments and pandemics (including the COVID-19 outbreak), or escalation of hostilities, cannot be predicted, but their occurrence can be expected to negatively affect the economy in general, and specifically the markets for our products. The resulting damage from a direct attack on our assets, or assets used by us, could include loss of life and property damage. In addition, available insurance coverage may not be sufficient to cover all of the damage incurred or, if available, may be prohibitively expensive.

We may not be able to renew our leases of land where four of our operations facilities reside.

We lease the land where our three main terminals are located and where another significant manufacturing plant is located. These leases, including all renewal periods, have expiration dates from 2023 to 2044. The failure to secure extended lease terms on any one of these facilities may have a material adverse impact on our business, as they are where a portion of our chemicals are manufactured and where the majority of our bulk chemicals are stored. While we can make no assurances, based on historical experience and anticipated future needs, we intend to extend these leases and believe that we will be able to renew our leases as the renewal periods expire. If we are unable to renew three of our leases (two relate to terminals and one to manufacturing) any property remaining on the land becomes the property of the lessor, and the lessor has the option to either maintain the property or remove the property at our expense. The fourth lease provides that we turn any property remaining on the land over to the lessor for them to maintain or remove at their expense. The cost to relocate our operations could have a material adverse effect on our results of operations and financial condition.

8

LEGAL AND REGULATORY RISKS

Environmental, health and safety, transportation and storage laws and regulations cause us to incur substantial costs and may subject us to future liabilities and risks.

We are subject to numerous federal, state and local environmental, health and safety laws and regulations in the jurisdictions in which we operate, including the management, storage, transportation and disposal of chemicals and wastes; product regulation; air water and soil contamination; and the investigation and cleanup of any spills or releases that may result from our management, handling, storage, sale, or transportation of chemicals and other products. The nature of our business exposes us to risks of liability under these laws and regulations. Ongoing compliance with such laws and regulations is an important consideration for us and we invest substantial capital and incur significant operating costs in our compliance efforts. In addition, societal concerns regarding the safety of chemicals in commerce and their potential impact on the environment have resulted in a growing trend towards increasing levels of product safety and environmental protection regulations. These concerns have led to, and could continue to result in, more stringent regulatory intervention by governmental authorities. In addition, these concerns could influence public perceptions, impact the commercial viability of the products we sell and increase the costs to comply with increasingly complex regulations, which could have a negative impact on our business, financial condition and results of operations.

In addition, we operate a fleet of more than 200 commercial vehicles, primarily in our Water Treatment Group, which are highly regulated, including by the U.S. Department of Transportation (“DOT”). The DOT governs transportation matters including authorization to engage in motor carrier service, including the necessary permits to conduct our businesses, equipment operation, and safety. We are audited periodically by the DOT to ensure that we are in compliance with various safety, hours-of-service, and other rules and regulations. If we were found to be out of compliance, the DOT could severely restrict or otherwise impact our operations, which could have a material adverse effect on our operations as a whole, including our results of operations and cash flows.

If we violate applicable laws or regulations, in addition to being required to correct such violations, we could be held liable in administrative, civil or criminal proceedings for substantial fines and other sanctions that could disrupt, limit or halt our operations, which could have a material adverse effect on our operations as a whole, including our results of operations and cash flows. Liabilities associated with the investigation and cleanup of releases of hazardous substances, as well as personal injury, property damages or natural resource damages arising out of such releases of hazardous substances, may be imposed in many situations without regard to violations of laws or regulations or other fault, and may also be imposed jointly and severally (so that a responsible party may be held liable for more than its share of the losses involved, or even the entire loss). Such liabilities can be difficult to identify and the extent of any such liabilities can be difficult to predict. We use, and in the past have used, hazardous substances at many of our facilities, and have generated, and continue to generate, hazardous wastes at a number of our facilities. We have in the past been, and may in the future be, subject to claims relating to exposure to hazardous materials and the associated liabilities may be material.

9

Our food, pharmaceutical and health and nutrition products are subject to government regulation, both in the United States and abroad, which could increase our costs significantly and limit or prevent the sale of such products.

The manufacture, packaging, labeling, advertising, promotion, distribution and sale of our food, pharmaceutical pesticide and health and nutrition products are subject to regulation by numerous national and local governmental agencies in the United States and other countries. The primary regulatory bodies in the United States are the Food and Drug Administration (the “FDA”), the Environmental Protection Agency, the United States Department of Agriculture and the Federal Trade Commission, and we are also subject to similar regulators in other countries. Failure to comply with these regulatory requirements may result in various types of penalties or fines. These include injunctions, product withdrawals, recalls, product seizures, fines and criminal prosecutions. Individual states also regulate our products. A state may interpret claims or products presumptively valid under federal law as illegal under that state’s regulations. Approvals or licensing may be conditioned on reformulation of products or may be unavailable with respect to certain products or product ingredients. Any of these government agencies, as well as legislative bodies, can change existing regulations, or impose new ones, or could take aggressive measures, causing or contributing to a variety of negative consequences, including:

•    stopping the sale of products,

•requirements for the reformulation of certain or all products to meet new standards,

•    the recall or discontinuance of certain or all products,

•    additional record-keeping requirements,

•    expanded documentation of the properties of certain or all products,

•    expanded or different labeling,

•    adverse event tracking and reporting, and

•    additional scientific substantiation.

In particular, the FDA’s current GMPs describe policies and procedures designed to ensure that nutraceuticals, pharmaceuticals and dietary supplements are produced in a quality manner, do not contain contaminants or impurities, and are accurately labeled and cover the manufacturing, packaging, labeling and storing of supplements, with requirements for quality control, design and construction of manufacturing plants, testing of ingredients and final products, record keeping, and complaints processes. Those who manufacture, package or store dietary supplements must comply with current GMPs. If we or our suppliers fail to comply with current GMPs, the FDA may take enforcement action against us or our suppliers.

Any or all of the potential negative consequences described above could have a material adverse effect on us or substantially increase the cost of doing business in these areas. There can be no assurance that the regulatory environment in which we operate will not change or that such regulatory environment, or any specific action taken against us, will not result in a material adverse effect on us.

10

FINANCIAL RISKS

The insurance that we maintain may not fully cover all potential exposures.

We maintain lines of commercial insurance, such as property, general liability and casualty insurance, but such insurance may not cover all risks associated with the hazards of our businesses and is subject to limitations, including deductibles and limits on the liabilities covered. We may incur losses beyond the limits or outside the coverage of our insurance policies, including liabilities for environmental remediation and product liability. In addition, from time to time, various types of insurance for companies in the chemical, food or health and nutrition products industries have not been available on commercially acceptable terms or, in some cases, have not been available at all. In the future, we may not be able to obtain coverage at current levels, and our premiums may increase significantly on coverage that we maintain.

Failure to comply with the covenants under our credit facility may have a material adverse effect.

We are party to a credit agreement (the “Credit Agreement”) with U.S. Bank National Association and other lenders (collectively, the “Lenders”), which includes secured revolving credit facilities (the “Revolving Loan Facility”) totaling $250.0 million. The Revolving Loan Facility includes a $10.0 million letter of credit subfacility and $25.0 million swingline subfacility. At April 3, 2022, we had $126.0 million outstanding under the Revolving Loan Facility.

We may make payments on the Revolving Loan Facility from time to time. If we are unable to generate sufficient cash flow or otherwise obtain funds necessary to make payments on our credit facilities, we could be in default when the facilities become due in 2027. We are also required to comply with several financial covenants under the Credit Agreement. Our ability to comply with these financial covenants may be affected by events beyond our control, which could result in a default under the Credit Agreement; such default may have a material adverse effect on our business, financial condition, operating results or cash flows.

The Credit Agreement also contains other customary affirmative and negative covenants, including covenants that restrict our ability to incur additional indebtedness, dispose of significant assets, make certain investments, including any acquisitions other than permitted acquisitions, make certain payments, enter into sale and leaseback transactions, grant liens on its assets or rate management transactions, subject to certain limitations. These restrictions may adversely affect our business.

Impairment to the carrying value of our goodwill or other intangible assets could adversely affect our financial condition and consolidated results of operations.

Goodwill represents the excess of the cost of acquired businesses over the fair value of identifiable tangible net assets and identifiable intangible assets purchased. Goodwill is tested at least annually for impairment and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. A significant amount of judgment is involved in determining if an indication of impairment exists. Factors may include, among others: a significant decline in our expected future cash flows; a sustained, significant decline in our stock price and market capitalization; a significant adverse change in the business climate; unanticipated competition; and slower growth rates. An adverse change in these factors may have a significant impact on the recoverability of the net assets recorded, and any resulting impairment charge in the future could have a material adverse effect on our financial condition and consolidated results of operations.

We evaluate the useful lives of our intangible assets to determine if they are definite- or indefinite-lived. Reaching a determination on useful life requires significant judgments and assumptions regarding the future effects of obsolescence, demand, competition, other economic factors (such as the stability of the industry, legislative action that results in an uncertain or changing regulatory environment, and expected changes in distribution channels), and the expected lives of other related groups of assets.

We cannot accurately predict the amount and timing of any impairment of goodwill and other intangible assets. Should the value of these assets become impaired, there could be a material adverse effect on our financial condition and consolidated results of operations.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

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ITEM 2. PROPERTIES

Our facilities material to our operations consist of our locations described below. In addition to the facilities listed below, our Water Treatment group operates out of 33 additional warehouse locations, the majority of which are owned by us. We believe that our facilities are adequate and suitable for the purposes they serve. Unless noted, each facility is owned by us and is primarily used as office and warehouse space. We believe that we carry customary levels of insurance covering the replacement of damaged property.

Group	Location	Approx. Square Feet
Corporate headquarters	Roseville, MN	50,000
Health and Nutrition	Fullerton, CA (1)	55,800
	Florida, NY (2)	107,000
Industrial	Minneapolis, MN (3)	177,000
	Centralia, IL (4)	77,000
	Dupo, IL (5)	64,000
	St. Paul, MN (6)	32,000
	Rosemount, MN (7)	105,000
Industrial and Water Treatment	St. Paul, MN (8)	59,000
	Camanche, IA	95,000
	Memphis, TN	41,000
Water Treatment	Apopka, FL	32,100

(1)This is a leased facility comprising administrative offices and a distribution facility. The lease runs through January 2026.

(2)This is comprised of (i) a 79,000 square foot manufacturing plant which sits on approximately 16 acres and (ii) a leased 28,000 square foot warehouse located in close proximity that is leased until December 2022.

(3)This manufacturing location sits on approximately 11 acres of land.

(4)This manufacturing facility includes 12 acres of land owned by the Company.

(5)The land for this manufacturing and packaging facility is leased from a third party, with the lease expiring in May 2023.

(6)These terminal operations, located at two sites on opposite sides of the Mississippi River, are made up of three buildings, outside storage tanks for the storage of liquid bulk chemicals, including caustic soda, as well as numerous smaller tanks for storing and mixing chemicals. The land is leased from the Port Authority of the City of St. Paul, Minnesota. One of the applicable leases runs through 2033, while the other one runs through 2044 including all available lease extensions.

(7)This includes two adjacent facilities comprising a total of 56 acres of land owned by the Company. These manufacturing facilities have outside storage tanks for the storage of bulk chemicals, as well as numerous smaller tanks for storing and mixing chemicals.

(8)This facility, which consists of a 59,000 square-foot building located on approximately 10 acres of land, has outside storage capacity for liquid bulk chemicals, as well as numerous smaller tanks for storing and mixing chemicals. The land is leased from the Port Authority of the City of St. Paul, Minnesota and runs until 2029.

ITEM 3. LEGAL PROCEEDINGS

There are no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which we or any of our subsidiaries are a party or of which any of our property is the subject.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5. MARKET FOR THE COMPANY’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common shares are listed on the Nasdaq Global Select Market under the symbol “HWKN.” As of May 13, 2022, shares of our common shares were held by approximately 387 shareholders of record.

The following graph compares the cumulative total shareholder return on our common shares with the cumulative total returns of the Nasdaq Industrial Index, the Nasdaq Composite Index, the Russell 2000 Index and the Standard & Poor’s (“S&P”) Small Cap 600 Index for our last five completed fiscal years. The graph assumes the investment of $100 in our stock and each of those indices on April 2, 2017, and reinvestment of all dividends.

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ITEM 6. RESERVED

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is a discussion and analysis of our financial condition and results of operations for fiscal 2022 and 2021. This discussion should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

We have omitted discussion of the earliest of the three years covered by our consolidated financial statements presented in this report because that disclosure was already included in our Annual Report on Form 10-K for fiscal 2021, filed with the SEC on June 2, 2021. You are encouraged to reference Part II, Item 7, within that report, for a discussion of our financial condition and results of operations for fiscal 2020 compared to fiscal 2021.

Overview

We derive substantially all of our revenues from the sale of specialty chemicals and ingredients that we formulate, distribute, blend and manufacture for our Industrial, Water Treatment and Health and Nutrition customers.

Financial Overview

Highlights of fiscal 2022 include:

•Sales of $774.5 million, a 30% increase from fiscal 2021;

•Gross profit of $146.5 million, an increase of $22.8 million, or 18% from fiscal 2021;

•An increase in selling, general and administrative (“SG&A”) expenses of $7.4 million year over year, but a decrease of 160 basis points as a percentage of sales when compared to fiscal 2021;

We focus on total profitability dollars when evaluating our financial results as opposed to profitability as a percentage of sales, as sales dollars tend to fluctuate as raw material prices rise and fall, particularly in our Industrial and Water Treatment segments. The costs for certain of our raw materials can rise or fall rapidly, causing fluctuations in gross profit as a percentage of sales.

We use the last in, first out (“LIFO”) method of valuing the majority of our inventory in our Industrial and Water Treatment segments, which causes the most recent product costs to be recognized in our income statement. The LIFO inventory valuation method and the resulting cost of sales are consistent with our business practices of pricing to current chemical raw material prices. Inventories in our Health and Nutrition segment are valued using the first-in, first-out (“FIFO”) method.

We disclose the sales of our bulk commodity products as a percentage of total sales dollars for our Industrial and Water Treatment segments. Our definition of bulk commodity products includes products that we do not modify in any way, but receive, store, and ship from our facilities, or direct ship to our customers in large quantities.

Business and Property Acquisitions

On December 30, 2021, we acquired substantially all the assets of NAPCO Chemical Company, Inc. and its affiliates ("NAPCO") under the terms of an asset purchase agreement among us, NAPCO and certain other parties thereto. NAPCO manufactures and distributes water treatment chemicals from three locations in Texas. The results of operations are included as part of our Water Treatment segment from the date of acquisition forward.

On October 29, 2021, we acquired substantially all the assets of Water and Waste Specialties, LLC, under the terms of an asset purchase agreement with Water and Waste Specialties and its shareholders. Water and Waste Specialties was a water treatment chemical distribution company operating primarily in Alabama. The results of operations since the acquisition date are included in our Water Treatment segment.

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On September 20, 2021, we acquired substantially all the assets of Southeast Water Systems LLC, under the terms of an asset purchase agreement with Southeast Water Systems and its shareholders. Southeast Water Systems supplied and installed water treatment chemical equipment to its customers located primarily in Alabama, southern Georgia and the Florida panhandle. The results of operations since the acquisition date are included in our Water Treatment segment.

In the fourth quarter of fiscal 2021, we acquired substantially all the assets of C & L Aqua Professionals, Inc. and LC Blending, Inc. (together, “C&L Aqua”) under the terms of an asset purchase agreement among us, C&L Aqua and its shareholders. C&L Aqua was a water treatment chemical distribution company operating primarily in Louisiana. The results of operations since the acquisition date are included in our Water Treatment segment.

In the third quarter of fiscal 2021, we acquired a manufacturing facility to allow further expansion and growth in both our Industrial and Water Treatment segments. This site is adjacent to our facility in Rosemount, Minnesota, adding 40,000 square feet of manufacturing and warehouse space on 28 acres of land to bring us to a total of 105,000 square feet of space on 56 acres of land, with rail access at both of the sites. The expansion will allow for future growth and provide supply chain flexibility on certain raw materials to better serve our customers.

In the second quarter of fiscal 2021, we acquired substantially all the assets of American Development Corporation of Tennessee, Inc. (“ADC”) under the terms of an asset purchase agreement among us, ADC and its shareholders. ADC was a water treatment chemical distribution company operating primarily in Tennessee, Georgia and Kentucky. The results of operations since the acquisition date are included in our Water Treatment segment.

The aggregate annual revenue of the three businesses acquired in fiscal 2022 totaled approximately $17 million, as determined using the applicable twelve-month period preceding each respective acquisition date. The aggregate annual revenue from the fiscal 2021 acquisitions totaled approximately $25 million, as determined using the applicable twelve-month period preceding each respective acquisition date.

Stock Split

On March 1, 2021, we effected a two-for-one split of our common stock and adjusted the par value from $.05 per share to $0.01 per share. At the same time, we increased the number of authorized shares from 30 million to 60 million. Our consolidated financial statements, related notes, and other financial data contained in this report have been adjusted to give retroactive effect to the stock split for all periods presented.

Statement on COVID-19

During the pandemic caused by COVID-19, federal, state and local governments around the world implemented stringent measures to help control the spread of the virus, including, from time to time, quarantines, “shelter in place” and “stay at home” orders, travel restrictions or bans, business curtailments, school closures, and other protective measures. While most restrictions have eased since the start of the COVID-19 pandemic, certain restrictions remain in place or new restrictions may be implemented in the future.

All of our manufacturing facilities have qualified as essential operations (or the equivalent) under applicable federal and state orders. As a result, all of our manufacturing sites and facilities have continued to operate, with no significant impact to our output levels.

During the public health crisis, we remained focused on the health and safety of our employees, customers and suppliers and maintaining safe and reliable operations of our manufacturing sites. As our operations and products are essential to critical national infrastructure, it is imperative that we continue to supply materials including the products needed to maintain safe drinking water, ingredients essential for large-scale food, pharmaceutical and other health product manufacturing and nutrition products needed to support our country's critical infrastructure.

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Results of Operations

The following table sets forth certain items from our statement of income as a percentage of sales for fiscal 2022 and 2021: 

	Fiscal 2022		Fiscal 2021
Sales	100.0	%	100.0	%
Cost of sales	(81.1)	%	(79.3)	%
Gross profit	18.9	%	20.7	%
Selling, general and administrative expenses	(9.7)	%	(11.3)	%
Operating income	9.2	%	9.4	%
Interest expense, net	(0.2)	%	(0.2)	%
Other income	—	%	0.2	%
Income before income taxes	9.0	%	9.4	%
Income tax provision	(2.3)	%	(2.5)	%
Net income	6.7	%	6.9	%

Fiscal 2022 Compared to Fiscal 2021

Sales

Sales were $774.5 million for fiscal 2022, an increase of $177.7 million, or 30%, from sales of $596.9 million for fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $17.5 million in additional sales.

Industrial Segment.  Industrial segment sales increased $113.6 million, or 42%, to $386.9 million for fiscal 2022, as compared to $273.4 million for fiscal 2021. Sales of bulk commodity products in the Industrial segment were approximately 16% of sales dollars in fiscal 2022 and 14% of sales dollars in fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $10.0 million in additional sales in our Industrial segment. In addition, the increase in sales was driven by increased selling prices on many of our products driven by higher costs on many of our raw materials, as well as increased sales of our bulk and our manufactured, blended and repackaged products.

Water Treatment Segment.  Water Treatment segment sales increased $58.1 million, or 34%, to $228.1 million for fiscal 2022, as compared to $170.0 million for fiscal 2021. Sales of bulk commodity products in the Water Treatment segment were approximately 9% of sales dollars in both fiscal 2022 and fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $3.9 million in additional sales in our Water Treatment segment. In addition, sales increased as a result of increased demand for our products as well as the added sales from acquisitions.

Health and Nutrition Segment. Health and Nutrition segment sales increased $6.0 million, or 4%, to $159.5 million for fiscal 2022, as compared to $153.5 million for fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $3.6 million in additional sales in our Health and Nutrition segment. In addition, sales increased as a result of an increase in sales of our specialty distributed products, which was partially offset by the normalizing of demand for our manufactured products when compared to the temporary COVID-driven increase in demand these products experienced in the prior year.

Gross Profit

Gross profit increased $22.8 million, or 18%, to $146.5 million, or 19% of sales, for fiscal 2022, from $123.8 million, or 21% of sales, for fiscal 2021. During fiscal 2022, the LIFO reserve increased, and gross profits decreased, by $15.8 million, primarily due to rising input costs. In fiscal 2021, the LIFO reserve decreased, and gross profits increased, by $0.1 million. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $3.6 million in additional gross profit.

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Industrial Segment.  Gross profit for the Industrial segment increased $16.3 million, or 38%, to $59.6 million, or 15% of sales, for fiscal 2022, from $43.3 million, or 16% of sales, for fiscal 2021. During fiscal 2022, the LIFO reserve increased, and gross profits decreased, by $10.4 million, primarily due to rising raw material costs. In fiscal 2021, the LIFO reserve decreased, and gross profits increased, by $0.2 million. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $1.9 million in additional gross profit in our Industrial segment. In addition, gross profit increased as a result of the increase in sales, partially offset by the negative impact resulting from the increase in the LIFO reserve.

Water Treatment Segment.  Gross profit for the Water Treatment segment increased $7.8 million, or 17%, to $54.6 million, or 24% of sales, for fiscal 2022, from $46.8 million, or 28% of sales, for fiscal 2021. During fiscal 2022, the LIFO reserve increased, and gross profits decreased, by $5.4 million, primarily due to rising raw material costs. During fiscal 2021, the LIFO reserve increased, and gross profit decreased, by $0.1 million. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $1.0 million in additional gross profit in our Water Treatment segment. In addition, gross profit increased as a result of the increase in sales.

Health and Nutrition Segment. Gross profit for our Health and Nutrition segment decreased $1.3 million, or 4%, to $32.3 million, or 20% of sales, for fiscal 2022, from $33.6 million, or 22% of sales, for fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $0.7 million in additional gross profit in our Health and Nutrition segment. This increase from the 53rd week was more than offset by a decrease in gross profit resulting from a decline in sales of our manufactured products which generally have higher per-unit margins than our specialty distributed products.

Selling, General and Administrative Expenses

SG&A expenses increased $7.4 million to $75.3 million, or 10% of sales, for fiscal 2022, from $67.9 million, or 11% of sales, for fiscal 2021. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $1.0 million in additional SG&A expense. In addition, expenses increased in part due to the added costs from the acquired businesses in the Water Treatment segment, an increase in variable incentive compensation, increased costs due to added personnel and other resources as we invest to grow the business, and normalization of travel and other variable expenses to pre-COVID levels.

Operating Income

Operating income was $71.2 million, or 9% of sales, for fiscal 2022, as compared to $55.9 million, or 9% of sales, for fiscal 2021 due to the combined impact of the factors discussed above. We estimated the impact of the 53rd week in fiscal 2022 to be approximately $3 million in additional operating income.

Interest Expense, Net

Interest expense was $1.4 million for fiscal 2022, a decrease of $0.1 million from interest expense of $1.5 million for fiscal 2021. Lower borrowing rates compared to the prior year more than offset the increase in outstanding borrowings in the current year.

Income Tax Provision

Our effective tax rate was approximately 26.5% for both fiscal 2022 and fiscal 2021. The effective tax rate is impacted by projected levels of annual taxable income, permanent items, and state taxes.

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Selected Quarterly Financial Data

Selected financial data for our fiscal quarters is shown below. No changes have been made to previously reported information.

 

(In thousands, except per share data)	Fiscal 2022
	First		Second		Third		Fourth		Total
Sales	$	181,241	$	183,277	$	187,050	$	222,973	$	774,541
Gross profit	38,974		37,287		33,940		36,319		146,520
Selling, general, and administrative expenses	16,856		17,679		19,681		21,110		75,326
Operating income	22,118		19,608		14,259		15,209		71,194
Net income	16,628		14,133		10,204		10,577		51,542
Basic earnings per share	$	0.79	$	0.67	$	0.49	$	0.51	$	2.46
Diluted earnings per share	$	0.79	$	0.67	$	0.48	$	0.50	$	2.44
	Fiscal 2021
	First		Second		Third		Fourth
Sales	$	143,172	$	147,801	$	142,927	$	162,971	$	596,871
Gross profit	30,976		32,797		28,239		31,750		123,762
Selling, general, and administrative expenses	15,038		16,221		17,750		18,875		67,884
Operating income	15,938		16,576		10,489		12,875		55,878
Net income	11,788		12,190		7,921		9,081		40,980
Basic earnings per share	$	0.56	$	0.58	$	0.38	$	0.43	$	1.95
Diluted earnings per share	$	0.55	$	0.57	$	0.37	$	0.43	$	1.93
	Fiscal 2020
	First		Second		Third		Fourth
Sales	$	147,336	$	140,043	$	120,406	$	132,413	$	540,198
Gross profit	28,797		27,994		21,478		22,648		100,917
Selling, general, and administrative expenses	14,836		14,817		14,702		14,891		59,246
Operating income	13,961		13,177		6,776		7,757		41,671
Net income	9,807		9,250		4,547		4,763		28,367
Basic earnings per share	$	0.46	$	0.44	$	0.22	$	0.23	$	1.34
Diluted earnings per share	$	0.46	$	0.43	$	0.21	$	0.22	$	1.33

Earnings per share may not equal the face of the Consolidated Statements of Income due to rounding.

Liquidity and Capital Resources

Cash provided by operating activities in fiscal 2022 was $42.8 million compared to $43.8 million in fiscal 2021. The decrease in cash provided by operating activities in fiscal 2022 as compared to fiscal 2021 was driven by higher inventory levels and increases in customer receivables resulting from higher sales, mostly offset by an increase in net income and accounts payable. The inventory increase was driven by increased raw material costs as well as a conscious management decision to increase inventory levels due to increased customer demand and supply chain issues. Due to the nature of our operations, which includes purchases of large quantities of bulk chemicals, the timing of purchases can result in significant changes in working capital and the resulting operating cash flow. Historically, our cash requirements for working capital increase during the period from March through November as caustic soda inventory levels increase as most of our barges are received during this period.

18

Cash used in investing activities was $49.8 million in fiscal 2022 compared to $71.4 million in fiscal 2021. Capital expenditures were $28.5 million in fiscal 2022 and $20.8 million in fiscal 2021. Total cash used in investing activities in fiscal 2022 included an aggregate of $21.5 million for Water Treatment group acquisitions compared to $51.0 million in Water Treatment group acquisition spending in fiscal 2021. Capital expenditures in fiscal 2022 included vehicles and trucks, facility improvements, and pharmaceutical ingredient manufacturing capabilities, along with other new and replacement equipment. Capital expenditures in fiscal 2021 included pharmaceutical ingredient manufacturing capabilities, vehicles and trucks, and the purchase of a previously leased Water Treatment branch facility, along with other new and replacement equipment.

Cash provided by financing activities was $7.4 million in fiscal 2022, as compared to $26.4 million in fiscal 2021. Cash provided by financing activities included net debt borrowings of $27.0 million in fiscal 2022, compared to net debt borrowings of $39.0 million in fiscal 2021, which was used primarily to fund our acquisitions in both fiscal years. We paid out cash dividends of $11.1 million in fiscal 2022 and $10.0 million in fiscal 2021. In fiscal 2022, we used $8.5 million to repurchase shares under our board-authorized share repurchase program, and in fiscal 2021, we used $4.1 million to repurchase shares under the program.

Our cash balance was $3.5 million at April 3, 2022, an increase of $0.5 million as compared with March 28, 2021. Cash flows generated by operations and financing activities during fiscal 2022 were offset by the cash expended for acquisitions in fiscal 2022, capital expenditures and dividend payments.

We were party to an amended and restated credit agreement (the “Prior Credit Agreement”) with U.S. Bank as Sole Lead Arranger and Sole Book Runner, and other lenders from time to time party thereto (collectively, the “Lenders”), whereby U.S. Bank was also serving as Administrative Agent. The Prior Credit Agreement provided us with senior secured revolving credit facilities (the “Prior Revolving Loan Facility”) totaling $150.0 million. The Prior Revolving Loan Facility included a $5.0 million letter of credit subfacility and $15.0 million swingline subfacility. The Prior Revolving Loan Facility was scheduled to terminate on November 30, 2023, and was secured by substantially all of our personal property assets and those of our subsidiaries.

On March 31, 2022, we entered into a second amended and restated credit agreement (the “Credit Agreement”) with U.S. Bank National Association (“U.S. Bank”) as Sole Lead Arranger and Sole Book Runner, and other lenders from time to time party thereto (collectively, the “Lenders”), whereby U.S. Bank is also serving as Administrative Agent. The Credit Agreement refinanced the revolving loan under our previous credit agreement with U.S. Bank and provides us with senior secured revolving credit facilities (the “Revolving Loan Facility”) totaling $250 million. The Revolving Loan Facility includes a $10 million letter of credit subfacility and $25 million swingline subfacility. The Revolving Loan Facility has a five-year maturity date, maturing on April 30, 2027. The Revolving Loan Facility is secured by substantially all of our personal property assets and those of our subsidiaries.

We used $126.0 million of the proceeds from the Revolving Loan Facility to refinance the obligations under the previous credit facility. We may use the remaining amount of the Revolving Loan Facility for working capital, capital expenditures, share repurchases, restricted payments and acquisitions permitted under the Credit Agreement, and other general corporate purposes.

Borrowings under the Revolving Loan Facility bear interest at a rate per annum equal to one of the following, plus, in both cases, an applicable margin based upon our leverage ratio: (a) Term SOFR, which includes a credit spread adjustment of 0.10%, for an interest period of one, three or six months as selected by us, reset at the end of the selected interest period, or (b) a base rate determined by reference to the highest of (1) U. S. Bank’s prime rate, (2) the Federal Funds Effective Rate plus 0.5%, or (3) one-month Term SOFR for U.S. dollars plus 1.0%. The Term SOFR margin is between 0.85% and 1.35%, depending on our leverage ratio. The base rate margin is between 0.00% and 0.35%, depending on our leverage ratio. At April 3, 2022, the effective interest rate on our borrowings was 1.2%.

In addition to paying interest on the outstanding principal under the Revolving Loan Facility, we are required to pay a commitment fee on the unutilized commitments thereunder. The commitment fee is between 0.15% and 0.25%, depending on our leverage ratio.

Debt issuance costs paid to the Lenders are being amortized as interest expense over the term of the Credit Agreement. As of April 3, 2022, the unamortized balance of these costs was $0.4 million, and is reflected as a reduction of debt on our balance sheet.

19

The Credit Agreement requires us to maintain (a) a minimum fixed charge coverage ratio of 1.15 to 1.00 and (b) a maximum total cash flow leverage ratio of 3.0 to 1.0. The Credit Agreement also contains other customary affirmative and negative covenants, including covenants that restrict our ability to incur additional indebtedness, dispose of significant assets, make certain investments, including any acquisitions other than permitted acquisitions, make certain payments, enter into sale and leaseback transactions, grant liens on our assets or enter into rate management transactions, subject to certain limitations. We are permitted to make distributions, pay dividends and repurchase shares so long as no default or event of default exists or would exist as a result thereof. We were in compliance with all covenants of the Credit Agreement as of April 3, 2022 and expect to remain in compliance with all covenants for the next 12 months.

The Credit Agreement contains customary events of default, including failure to comply with covenants in the Credit Agreement and other loan documents, cross default to other material indebtedness, failure by us to pay or discharge material judgments, bankruptcy, and change of control. The occurrence of an event of default would permit the lenders to terminate their commitments and accelerate loans under the Credit Facility.

We have in place an interest rate swap agreement to manage the risk associated with a portion of our variable-rate long-term debt. We do not utilize derivative instruments for speculative purposes. The interest rate swap involves the exchange of fixed-rate and variable-rate payments without the exchange of the underlying notional amount on which the interest payments are calculated. The notional amount of the swap agreement is $60 million and it will terminate on May 1, 2027.

As part of our growth strategy, we have acquired businesses and may pursue acquisitions or other strategic relationships in the future that we believe will complement or expand our existing businesses or increase our customer base. We believe we could borrow additional funds under our current or new credit facilities or sell equity for strategic reasons or to further strengthen our financial position.

Contractual Obligations and Commercial Commitments

The following table provides aggregate information about our contractual payment obligations and the periods in which payments are due: 

	Payments Due by Fiscal Period
Contractual Obligation	2023		2024		2025		2026		2027		More than 5  Years		Total
	(In thousands)
Senior secured revolver (1)	$	—	$	—	$	—	$	—	$	—	$	126,000	$	126,000
Interest payments (2)	$	1,833	$	1,833	$	1,833	$	1,833	$	1,833	$	152	$	9,317
Operating lease obligations (3)	$	1,889	$	1,515	$	1,450	$	1,388	$	1,359	$	5,171	$	12,772
Pension withdrawal liability (4)	$	467	$	467	$	467	$	467	$	467	$	3,037	$	5,372

(1)    Represents balance outstanding as of April 3, 2022, and assumes such amount remains outstanding until its maturity date, as periodic payments are not required under the terms of our Credit Agreement. However, it is our intention to pay down our debt with available excess cash flow. See Note 9 of our consolidated Financial Statements for further information.

(2)    Represents interest payments and commitment fees payable on outstanding balances under our revolver, and assumes interest rates remain unchanged from the rate as of April 3, 2022.

(3)    As reported under ASC Topic 842

(4)    This relates to our withdrawal from a multiemployer pension plan. Payments on this obligation will continue through 2034.

Critical Accounting Estimates

In preparing the financial statements, we follow U.S. generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, sales and expenses, and related disclosure of contingent assets and liabilities. We re-evaluate our estimates on an on-going basis. Our estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions and conditions. We have determined we have no critical accounting estimates material to our consolidated financial position, results of operations or cash flow.

20

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are subject to the risk inherent in the cyclical nature of commodity chemical prices. However, we do not currently purchase forward contracts or otherwise engage in hedging activities with respect to the purchase of commodity chemicals. We attempt to pass changes in the cost of our materials on to our customers; however, there are no assurances that we will be able to pass on the increases in the future.

We are exposed to market risks related to interest rates. Our exposure to changes in interest rates is limited to borrowings under our credit facility. A 25-basis point change in interest rates on the variable-rate portion of debt not covered by the interest rate swap would potentially increase or decrease annual interest expense by approximately $0.3 million. Other types of market risk, such as foreign currency risk, do not arise in the normal course of our business activities.

21

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID: 248)	23
Report of Independent Registered Public Accounting Firm (PCAOB ID: 185)	25
Consolidated Balance Sheets	26
Consolidated Statements of Income	27
Consolidated Statements of Comprehensive Income	28
Consolidated Statements of Shareholders’ Equity	29
Consolidated Statements of Cash Flows	30
Notes to Consolidated Financial Statements	31

22

Report of Independent Registered Public Accounting Firm

Board of Directors and Shareholders

Hawkins, Inc.

Opinion on internal control over financial reporting

We have audited the internal control over financial reporting of Hawkins, Inc. (a Minnesota corporation) and subsidiaries (the “Company”) as of April 3, 2022, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of April 3, 2022, based on criteria established in the 2013 Internal Control—Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Company as of and for the year ended April 3, 2022, and our report dated May 18, 2022 expressed an unqualified opinion on those financial statements.

Basis for opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting (“Management’s Report”). Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Our audit of, and opinion on, the Company’s internal control over financial reporting does not include the internal control over financial reporting of NAPCO Chemical Company, Inc. (“NAPCO”), a wholly-owned subsidiary, whose financial statements reflect total assets and revenues constituting less than 4% and less than 1%, respectively, of the related consolidated financial statement amounts as of and for the year ended April 3, 2022. As indicated in Management’s Report, NAPCO was acquired during fiscal 2022. Management’s assertion on the effectiveness of the Company’s internal control over financial reporting excluded internal control over financial reporting of NAPCO.

Definition and limitations of internal control over financial reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ GRANT THORNTON LLP

Minneapolis, Minnesota

May 18, 2022

23

Report of Independent Registered Public Accounting Firm

Board of Directors and Shareholders

Hawkins, Inc.

Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of Hawkins, Inc. (a Minnesota corporation) and subsidiaries (the “Company”) as of April 3, 2022 and March 28, 2021 and the related consolidated statements of income, comprehensive income, shareholders’ equity, and cash flows for the years then ended, and the related notes and financial statement schedule included under Item 15(a) (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of April 3, 2022 and March 28, 2021, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of April 3, 2022 based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated May 18, 2022 expressed an unqualified opinion.

Basis for opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical audit matters

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

/s/ GRANT THORNTON LLP

We have served as the Company’s auditor since 2021.

Minneapolis, Minnesota

May 18, 2022

24

Report of Independent Registered Public Accounting Firm

Board of Directors and Shareholders

Hawkins, Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of income, comprehensive income, shareholders’ equity, and cash flows of Hawkins, Inc. and subsidiaries (the Company) for the year ended March 29, 2020 and the related notes and financial statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the results of operations of the Company and its cash flows for the year ended March 29, 2020, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

/s/ KPMG LLP

We served as the Company’s auditor from 2009 to 2020.

Minneapolis, Minnesota

May 20, 2020, except as to the stock split and par value adjustments as described in Note 1, which are as of June 2, 2021

25

HAWKINS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per-share data)

	April 3, 2022		March 28, 2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	3,496	$	2,998
Trade accounts receivables, net	122,826		90,603
Inventories	94,985		63,864
Prepaid expenses and other current assets	6,431		5,542
Total current assets	227,738		163,007
PROPERTY, PLANT, AND EQUIPMENT:
Land	16,640		15,235
Buildings and improvements	118,369		120,410
Machinery and equipment	114,763		109,353
Transportation equipment	43,968		37,646
Office furniture and equipment	10,315		17,760
	304,055		300,404
Less accumulated depreciation	142,209		155,792
Net property, plant, and equipment	161,846		144,612
OTHER ASSETS:
Right-of-use assets	10,606		11,630
Goodwill	77,401		70,720
Intangible assets, net	80,193		76,368
Deferred compensation plan asset	6,783		5,726
Other	2,761		487
Total other assets	177,744		164,931
Total assets	$	567,328	$	472,550
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable — trade	$	66,693	$	37,313
Accrued payroll and employee benefits	19,034		18,048
Current portion of long-term debt	9,913		9,907
Short-term lease liability	1,657		1,587
Container deposits	1,558		1,452
Other current liabilities	2,611		2,155
Total current liabilities	101,466		70,462
LONG-TERM DEBT, LESS CURRENT PORTION	115,644		88,845
LONG-TERM LEASE LIABILITY	9,143		10,231
PENSION WITHDRAWAL LIABILITY	4,276		4,631
DEFERRED INCOME TAXES	23,422		24,445
DEFERRED COMPENSATION LIABILITY	8,402		7,322
OTHER LONG-TERM LIABILITIES	2,374		1,368
Total liabilities	264,727		207,304
COMMITMENTS AND CONTINGENCIES (Note 13)
SHAREHOLDERS’ EQUITY:
Common shares; authorized: 60,000,000 shares of $0.01 par value; 20,889,777 and 20,969,746 shares issued and outstanding for 2022 and 2021, respectively	209		210
Additional paid-in capital	46,717		51,138
Retained earnings	254,384		213,898
Accumulated other comprehensive income	1,291		—
Total shareholders’ equity	302,601		265,246
Total liabilities and shareholders’ equity	$	567,328	$	472,550

See accompanying notes to consolidated financial statements.

26

HAWKINS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except share and per-share data)

	Fiscal Year Ended
	April 03, 2022		March 28, 2021		March 29, 2020
Sales	$	774,541	$	596,871	$	540,198
Cost of sales	(628,021)		(473,109)		(439,281)
Gross profit	146,520		123,762		100,917
Selling, general and administrative expenses	(75,326)		(67,884)		(59,246)
Operating income	71,194		55,878		41,671
Interest expense, net	(1,404)		(1,467)		(2,511)
Other income (expense)	189		1,440		(204)
Income before income taxes	69,979		55,851		38,956
Income tax expense	(18,437)		(14,871)		(10,589)
Net income	$	51,542	$	40,980	$	28,367
Weighted average number of shares outstanding-basic	20,947,234		21,024,344		21,159,978
Weighted average number of shares outstanding-diluted	21,135,258		21,260,296		21,308,800
Basic earnings per share	$	2.46	$	1.95	$	1.34
Diluted earnings per share	$	2.44	$	1.93	$	1.33
Cash dividends declared per common share	$	0.52250	$	0.47125	$	0.46125

See accompanying notes to consolidated financial statements.

27

HAWKINS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

 

	Fiscal Year Ended
	April 3, 2022		March 28, 2021		March 29, 2020
Net income	$	51,542	$	40,980	$	28,367
Other comprehensive income, net of tax:
Unrealized gain (loss) on interest rate swap	1,291		79		(396)
Total other comprehensive income (loss)	1,291		79		(396)
Total comprehensive income	$	52,833	$	41,059	$	27,971

See accompanying notes to consolidated financial statements.

28

HAWKINS, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In thousands, except share data)

	Common Shares			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Shareholders’ Equity
	Shares	Amount
BALANCE — March 31, 2019	21,184,900	$	212	$	52,927	$	164,405	$	317	$	217,861
Cash dividends declared	—	—		—		(9,825)		—		(9,825)
Share-based compensation expense	—	—		2,273		—		—		2,273
Vesting of restricted stock	71,944	—		—		—		—		—
Shares surrendered for payroll taxes	(18,320)	—		(343)		—		—		(343)
ESPP shares issued	77,100	1		1,399		—		—		1,400
Shares repurchased	(291,166)	(2)		(5,851)		—		—		(5,853)
Other comprehensive loss, net of tax	—	—		—		—		(396)		(396)
Net Income	—	—		—		28,367		—		28,367
BALANCE — March 29, 2020	21,024,458	$	211	$	50,405	$	182,947	$	(79)	$	233,484
Cash dividends declared and paid	—	—		—		(10,029)		—		(10,029)
Share-based compensation expense	—	—		3,343		—		—		3,343
Vesting of restricted stock	26,542	—		—		—		—		—
Shares surrendered for payroll taxes	(3,314)	—		(54)		—		—		(54)
ESPP shares issued	88,148	1		1,582		—		—		1,583
Shares repurchased	(166,088)	(2)		(4,138)		—		—		(4,140)
Other comprehensive loss, net of tax	—	—		—		—		79		79
Net income	—	—		—		40,980		—		40,980
BALANCE — March 28, 2021	20,969,746	$	210	$	51,138	$	213,898	$	—	$	265,246
Cash dividends declared and paid	—	—		—		(11,056)		—		(11,056)
Share-based compensation expense	—	—		3,818		—		—		3,818
Vesting of restricted stock	134,230	1		(1)		—		—		—
Shares surrendered for payroll taxes	(45,390)	—		(1,467)		—		—		(1,467)
ESPP shares issued	71,692	—		1,772		—		—		1,772
Shares repurchased	(240,501)	(2)		(8,543)		—		—		(8,545)
Other comprehensive income, net of tax	—	—		—		—		1,291		1,291
Net income	—	—		—		51,542		—		51,542
BALANCE — April 3, 2022	20,889,777	$	209	$	46,717	$	254,384	$	1,291	$	302,601

See accompanying notes to consolidated financial statements.

29

HAWKINS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Fiscal Year Ended
	April 3, 2022		March 28, 2021		March 29, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	51,542	$	40,980	$	28,367
Reconciliation to cash flows provided by operating activities:
Depreciation and amortization	24,129		22,669		21,584
Operating leases	1,899		1,896		2,033
(Gain) loss on deferred compensation assets	(189)		(1,440)		233
Deferred income taxes	(1,501)		(689)		(1,421)
Stock compensation expense	3,818		3,343		2,273
Other	545		203		656
Changes in operating accounts (using) providing cash, net of acquisitions:
Trade receivables	(30,526)		(21,323)		(3,387)
Inventories	(30,034)		(7,960)		6,045
Accounts payable	25,138		2,551		4,228
Accrued liabilities	2,723		7,554		663
Lease liabilities	(1,907)		(1,837)		(2,025)
Income taxes	214		(235)		586
Other	(3,014)		(1,919)		(933)
Net cash provided by operating activities	42,837		43,793		58,902
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant, and equipment	(28,512)		(20,794)		(24,549)
Acquisitions	(21,546)		(51,000)		—
Other	302		362		346
Net cash used in investing activities	(49,756)		(71,432)		(24,203)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends paid	(11,056)		(10,029)		(9,825)
New shares issued	1,772		1,583		1,400
Shares surrendered for payroll taxes	(1,467)		(54)		(343)
Shares repurchased	(8,545)		(4,140)		(5,853)
Payments for debt issuance costs	(287)		—		—
Payments on senior secured revolving loan	(15,000)		(37,000)		(44,000)
Borrowings on senior secured revolving loan	42,000		76,000		19,000
Net cash provided by (used in) financing activities	7,417		26,360		(39,621)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	498		(1,279)		(4,922)
CASH AND CASH EQUIVALENTS - beginning of year	2,998		4,277		9,199
CASH AND CASH EQUIVALENTS - end of year	$	3,496	$	2,998	$	4,277
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION-
Cash paid during the year for income taxes	$	19,726	$	15,783	$	11,415
Cash paid for interest	1,197		1,288		2,413
Noncash investing activities - Capital expenditures in accounts payable	3,733		626		1,041

See accompanying notes to consolidated financial statements.

30

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — Nature of Business and Significant Accounting Policies

Nature of Business - We have three reportable segments: Industrial, Water Treatment and Health and Nutrition. The Industrial Group specializes in providing industrial chemicals, products and services to industries such as agriculture, chemical processing, electronics, energy, food, pharmaceutical and plating. This group also manufactures and sells certain food-grade products, including liquid phosphates, lactates and other blended products. The Water Treatment Group specializes in providing chemicals, products, equipment, services and solutions for potable water, municipal and industrial wastewater, industrial process water and non-residential swimming pool water. This group has the resources and flexibility to treat systems ranging in size from a single small well to a multi-million-gallon-per-day facility. Our Health and Nutrition Group specializes in providing ingredient distribution, processing and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, health and wellness products. This group offers a diverse product portfolio including minerals, botanicals and herbs, vitamins and amino acids, excipients, joint products, sweeteners and enzymes.

Fiscal Year - Our fiscal year is a 52 or 53-week year ending on the Sunday closest to March 31. Our fiscal 2022 was 53 weeks and our fiscal 2021 fiscal 2020 were both 52 weeks. Fiscal 2023 will be 52 weeks.

Principles of Consolidation - The consolidated financial statements include the accounts of Hawkins, Inc. and its wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated.

Estimates - The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, particularly receivables, inventories, property, plant and equipment, right-of-use assets, goodwill, intangibles, accrued expenses, short-term and long-term lease liability, income taxes and related accounts and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition - Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. Revenue is recognized when we satisfy our performance obligations under the contract. We recognize revenue upon transfer of control of the promised products to the customer, with revenue recognized at the point in time the customer obtains control of the products. Net sales include products and shipping charges, net of estimates for product returns and any related sales rebates. We estimate product returns based on historical return rates. Using probability assessments, we estimate sales rebates expected to be paid over the term of the contract. The majority of our contracts have a single performance obligation and are short term in nature. Sales taxes that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. We offer certain customers cash discounts and volume rebates as sales incentives. The discounts and volume rebates are recorded as a reduction in sales at the time revenue is recognized in an amount estimated based on historical experience and contractual obligations.

Shipping and Handling - All shipping and handling amounts billed to customers are included in revenues. Costs incurred related to the shipping and the handling of products are included in cost of sales.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Fair Value Measurements - The financial assets and liabilities that are re-measured and reported at fair value for each reporting period are an interest rate swap and marketable securities. There are no fair value measurements with respect to nonfinancial assets or liabilities that are recognized or disclosed at fair value in our consolidated financial statements on a recurring basis.

Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1:  Valuation is based on quoted prices in active markets for identical assets or liabilities.

Level 2:  Valuation is based on quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for the asset or liability.

Level 3:  Valuation is based upon unobservable inputs for the asset or liability that are supported by little or no market activity. These fair values are determined using pricing models for which the assumptions utilize management’s estimates or market participant assumptions.

In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Cash Equivalents - Cash equivalents include all liquid debt instruments (primarily cash funds and money market accounts) purchased with an original maturity of three months or less. The cash balances, maintained at large commercial banking institutions with strong credit ratings, may, at times, exceed federally insured limits.

Trade Receivables and Concentrations of Credit Risk - Financial instruments, which potentially subject us to a concentration of credit risk, principally consist of trade receivables. We sell our principal products to a large number of customers in many different industries. As of April 3, 2022, we had a significant concentration of credit risk, with a single customer representing approximately 13% of our total trade receivables. There are no other concentrations of credit risk with other single customers from a particular service or geographic area that would significantly impact us in the near term.

To reduce credit risk, we routinely assess the financial strength of our customers. Receivables are reported net of an allowance for credit losses as determined by management at the end of each reporting period. Our receivable allowance in based on an estimate of expected credit losses, with the estimate based on a number of qualitative and quantitative factors that, based on collection experience, may have an impact on repayment risk and ability to collect.

Inventories - Inventories, consisting primarily of finished goods, are primarily valued at the lower of cost or net realizable value, with cost for approximately 73% of our inventory determined using the last-in, first-out (“LIFO”) method. Cost for the other 27% of our total inventory is determined using the first-in, first-out (“FIFO”) method.

Leases - We determine if an arrangement is a lease at inception. Right-of-use ("ROU") assets include operating leases. Lease liabilities for operating leases are classified in "short-term lease liabilities" and "long-term lease liabilities" in our consolidated balance sheet.

ROU assets and related liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Lease and non-lease components are generally accounted for separately for real estate leases. For non-real estate leases, we account for the lease and non-lease components as a single lease component.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Property, Plant and Equipment - Property is stated at cost and depreciated or amortized over the lives of the assets, using the straight-line method. Estimated lives are: 10 to 40 years for buildings and improvements; 3 to 20 years for machinery and equipment; and 3 to 10 years for transportation equipment and office furniture and equipment including computer systems. Leasehold improvements are amortized over the lesser of their estimated useful lives or the remaining lease term. Depreciation and amortization expense is recorded in our Consolidated Statement of Income within cost of goods sold and selling, general and administrative expense, depending on the use of the underlying asset. We recorded depreciation expense of $17.7 million for fiscal 2022, $16.8 million for fiscal 2021 and $16.5 million for fiscal 2020.

Significant improvements that add to productive capacity or extend the lives of properties are capitalized. Costs for repairs and maintenance are charged to expense as incurred. When property is retired or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts and any related gains or losses are included in income.

We review the recoverability of long-lived assets to be held and used, such as property, plant and equipment, when events or changes in circumstances occur that indicate the carrying value of the asset group may not be recoverable, such as prolonged industry downturn or significant reductions in projected future cash flows. The assessment of possible impairment is based on our ability to recover the carrying value of the asset group from the expected future pre-tax cash flows (undiscounted) of the related asset group. If these cash flows are less than the carrying value of such asset group, an impairment loss would be measured by the amount the carrying value exceeds the fair value of the long-lived asset group. The measurement of impairment requires us to estimate future cash flows and the fair value of long-lived assets. We did not incur any asset write-off charge in fiscal 2022 related to the impairment of long-lived assets. Asset write-off charges were $0.2 million during fiscal 2021 and $0.6 million during fiscal 2020.

Goodwill and Identifiable Intangible Assets - Goodwill represents the excess of the cost of acquired businesses over the fair value of identifiable tangible net assets and identifiable intangible assets purchased. Goodwill is tested at least annually for impairment, and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. Our annual test for impairment is as of the first day of our fourth fiscal quarter. As of December 27, 2021, we performed an analysis of qualitative factors for our Industrial, Water Treatment and Health and Nutrition reporting units to determine whether it is more likely than not that the fair value of either of these reporting units was less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform a quantitative goodwill impairment test for any of these reporting units.

Goodwill impairment assessments were also completed in the fourth quarters of fiscal 2021 and 2020 and similarly, we did not record a goodwill impairment charge.

Our primary identifiable intangible assets include customer lists, trade secrets, non-competition agreements, trademarks and trade names acquired in previous business acquisitions. Identifiable intangible assets with finite lives are amortized whereas identifiable intangible assets with indefinite lives are not amortized. The values assigned to the intangible assets with finite lives are being amortized on average over a remaining useful life of approximately 12 years. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. No such events or changes in circumstances occurred during fiscal 2022, 2021 or 2020. Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. The impairment test consists of a qualitative assessment to determine whether it is more likely than not that the asset is impaired. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform an annual quantitative impairment test for fiscal 2022, 2021 or 2020.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Income Taxes - We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income tax expense in the period that includes the enactment date. The deferred tax assets and liabilities are analyzed regularly, and management assesses the likelihood that deferred tax assets will be recovered from future taxable income. We record any interest and penalties related to income taxes as income tax expense in the consolidated statements of income.

We recognize the effect of income tax positions only if those positions are more-likely-than-not to be sustained. Recognized income tax positions are measured at the largest amount of tax with a greater than 50 percent likelihood of being realized upon ultimate settlement with the related tax authority. Changes in recognition or measurement are reflected in the period in which the facts and circumstances change.

Stock-Based Compensation - We account for stock-based compensation on a fair value basis. The estimated grant date fair value of each stock-based award is recognized in expense over the requisite service period (generally the vesting period). Non-vested share awards are recorded as expense over the requisite service periods based on the stock price on the date of grant.

Earnings Per Share - Basic earnings per share (“EPS”) are computed by dividing net income by the weighted-average number of common shares outstanding. Diluted EPS are computed by dividing net income by the weighted-average number of common shares outstanding including the incremental shares assumed to be issued as performance units and restricted stock. Basic and diluted EPS were calculated using the following:

	April 03, 2022	March 28, 2021	March 29, 2020
Weighted average common shares outstanding — basic	20,947,234	21,024,344	21,159,978
Dilutive impact of stock performance units and restricted stock	188,024	235,952	148,822
Weighted average common shares outstanding — diluted	21,135,258	21,260,296	21,308,800

There were no shares or stock options excluded from the calculation of weighted average common shares for diluted EPS for fiscal 2022, 2021 or 2020.

Stock Split - In fiscal 2021, we effected a two-for-one stock split of our common stock and adjusted the par value of our common stock to $.01 par value. Our consolidated financial statements, related notes, and other financial data contained in this report have been adjusted to give retroactive effect to the stock split for all periods presented.

Derivative Instruments and Hedging Activities - We are subject to interest rate risk associated with our variable rate debt. We have in place an interest rate swap agreement which has been designated as a cash flow hedge, the purpose of which is to eliminate the cash flow impact of interest rate changes on a portion of our variable-rate debt. The interest rate swap is measured at fair value on the contract date and is subsequently remeasured to fair value at each reporting date. Changes in the fair value of a derivative that is highly effective, and that is designated and qualifies as a cash flow hedge, are recorded in other comprehensive income, until the consolidated statement of income is affected by the variability in cash flows of the designated hedged item. To the extent that the hedge is ineffective, changes in the fair value are recognized in the Statement of Income.

Recently Issued Accounting Pronouncements

We do not expect that any recently issued accounting pronouncements will have a material effect on our financial statements.

Recently Adopted Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes, removing certain exceptions for investments, intra-period allocations and interim calculations and adding guidance to reduce complexity in accounting for income taxes. We adopted this guidance at the beginning of fiscal 2022. Our adoption of this ASU did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.

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HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 2 — Acquisitions

Acquisition of NAPCO Chemical Company, Inc.: On December 30, 2021, we acquired substantially all the assets of NAPCO Chemical Company, Inc. ("NAPCO"), under the terms of an asset purchase agreement with NAPCO and certain other parties thereto, to further the geographic reach of our Water Treatment segment. We paid $18.5 million at closing for the acquisition, and an additional $0.5 million for a working capital adjustment. NAPCO manufactures and distributes water treatment chemicals from three locations in Texas. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of NAPCO acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $19 million purchase price, we allocated $9.4 million to finite-lived intangible assets, primarily customer relationships to be amortized over 18 years, $3.6 million to property, plant and equipment and $1.5 million to net working capital. The residual amount of $4.5 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

Acquisition of Water and Waste Specialties, Inc.: On October 29, 2021, we acquired substantially all the assets of Water and Waste Specialties, Inc., under the terms of a purchase agreement with Water and Waste Specialties and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $1.4 million at closing for the acquisition. Water and Waste Specialties was a water treatment chemical distribution company operating primarily in Alabama. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of Water and Waste Specialties acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $1.4 million purchase price, we allocated $0.5 million to finite-lived intangible assets, primarily customer relationships to be amortized over 11 years, and $0.4 million to property, plant and equipment. The residual amount of $0.5 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

Acquisition of Southeast Water Systems LLC: On September 20, 2021, we acquired substantially all the assets of Southeast Water Systems LLC, under the terms of an asset purchase agreement with Southeast Water Systems and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $1.2 million at closing for the acquisition and may pay up to an additional $1.0 million over the next three years based on achieving certain goals. Southeast Water Systems supplied and installed water treatment chemical equipment to its customers located primarily in Alabama, southern Georgia and the Florida panhandle. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of Southeast Water Systems acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $2.2 million purchase price, which includes a contingent consideration liability of $1.0 million, we allocated $0.4 million to finite-lived intangible assets, primarily customer relationships to be amortized over 10 years, and $0.1 million to property, plant and equipment. The residual amount of $1.7 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Acquisition of C&L Aqua Professionals, Inc. and LC Blending, Inc.: In fiscal 2021, we acquired substantially all the assets of C&L Aqua Professionals, Inc. and LC Blending, Inc. (together, "C&L Aqua") under the terms of an asset purchase agreement among us, C&L Aqua and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $16 million for the acquisition. C&L Aqua was a water treatment chemical distribution company operating primarily in Louisiana. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of C&L Aqua acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the $16 million purchase price, we preliminarily allocated $8.2 million to finite-lived intangible assets, primarily customer relationships to be amortized over 18 years, $3.6 million to property, plant and equipment, and $1.1 million to net working capital. The residual amount of $3.1 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes.

Acquisition of Property: In fiscal 2021, we acquired a manufacturing facility on 28 acres located adjacent to our facility in Rosemount, Minnesota to allow further expansion and growth in both our Industrial and Water Treatment segments. We paid $10 million for the property. The purchase of this facility adds approximately 40,000 square feet of manufacturing and warehouse space to bring us to a total of 105,000 square feet of space on 56 acres of land in the area, with rail access at both of the sites to allow for future growth and provide for supply chain flexibility on certain raw materials to better serve our customers.

This acquisition has been accounted for as an asset acquisition, under which the total purchase price is allocated to the net tangible assets acquired based on their estimated fair values. Of the $10 million purchase price, $4.6 million was allocated to buildings, $3.7 million was allocated to land, $1.4 million was allocated to equipment, and $0.3 million was allocated to site improvements.

Acquisition of American Development Corporation of Tennessee, Inc.: In fiscal 2021, we acquired substantially all the assets of American Development Corporation of Tennessee, Inc. (“ADC”) under the terms of an asset purchase agreement among us, ADC and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $25 million for the acquisition. ADC was a water treatment chemical distribution company operating primarily in Tennessee, Georgia and Kentucky. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of ADC acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the $25 million purchase price, we allocated $13.3 million to finite-lived intangible assets, primarily customer relationships to be amortized over 17 years, $1.6 million to property, plant and equipment, and $0.9 million to net working capital. The residual amount of $9.2 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 3 — Revenue

Our revenue arrangements generally consist of a single performance obligation to transfer promised goods or services. We disaggregate revenues from contracts with customers by both operating segments and types of product sold. Reporting by operating segment is pertinent to understanding our revenues, as it aligns to how we review the financial performance of our operations. Types of products sold within each operating segment help us to further evaluate the financial performance of our segments.

The following table disaggregates external customer net sales by major revenue stream:

	Fiscal Year Ended April 3, 2022:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	318,514	$	205,350	$	34,690	$	558,554
Distributed specialty products (2)	—		—		124,312		124,312
Bulk products (3)	61,443		20,211		—		81,654
Other	6,981		2,572		468		10,021
Total external customer sales	$	386,938	$	228,133	$	159,470	$	774,541
	Fiscal Year Ended March 28, 2021:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	231,427	$	152,694	$	38,270	$	422,391
Distributed specialty products (2)	—		—		115,317		115,317
Bulk products (3)	38,378		16,067		—		54,445
Other	3,556		1,243		(81)		4,718
Total external customer sales	$	273,361	$	170,004	$	153,506	$	596,871
	Fiscal Year Ended March 29, 2020:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	222,161	$	139,917	$	14,770	$	376,848
Distributed specialty products (2)	—		—		90,065		90,065
Bulk products (3)	49,864		18,481		—		68,345
Other	3,199		1,497		244		4,940
Total external customer sales	$	275,224	$	159,895	$	105,079	$	540,198

(1)For our Industrial and Water Treatment segments, this line includes our non-bulk specialty products that we either manufacture, blend, repackage, resell in their original form, or direct ship to our customers in smaller quantities, and services we provide for our customers. For our Health and Nutrition segment, this line includes products manufactured, processed or repackaged in our facility and/or with our equipment

(2)This line includes non-manufactured distributed specialty products in our Health and Nutrition segment, which may be sold out of one of our facilities or direct shipped to our customers

(3)This line includes bulk products in our Industrial and Water Treatment segments that we do not modify in any way, but receive, store, and ship from our facilities, or direct ship to our customers in large quantities.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 4 — Derivative Instruments

We have in place an interest rate swap agreement to manage the risk associated with a portion of our variable-rate long-term debt. We do not utilize derivative instruments for speculative purposes. The interest rate swap involves the exchange of fixed-rate and variable-rate payments without the exchange of the underlying notional amount on which the interest payments are calculated. The notional amount of the swap agreement is $60 million and it will terminate on May 1, 2027. We have designated this swap as a cash flow hedge and have determined that it qualified for hedge accounting treatment. For so long as the hedge is effective, changes in fair value of the cash flow hedge are recorded in other comprehensive income or loss (net of tax) until income or loss from the cash flows of the hedged item is realized.

We previously had in place an interest rate swap agreement to manage the risk associated with a portion of our variable-rate long-term debt. The $20 million swap agreement terminated on December 23, 2020. We had designated this swap as a cash flow hedge and determined that it qualified for hedge accounting treatment. For so long as the hedge was effective, changes in fair value of the cash flow hedge were recorded in other comprehensive income or loss (net of tax) until income or loss from the cash flows of the hedged item was realized.

For the years ended April 3, 2022 and March 28, 2021, we recorded $1.3 million and $0.1 million in other comprehensive income related to unrealized gains (net of tax) on the cash flow hedge. For the year ended March 29, 2020, we recorded $0.4 million in other comprehensive income related to unrealized losses (net of tax) on the cash flow hedge described above. Included in other other long-term assets on our consolidated balance sheet was $1.8 million as of April 3, 2022. Included in other current liabilities on our consolidated balance sheet was $0.1 million as of March 29, 2020.

By their nature, derivative instruments are subject to market risk. Derivative instruments are also subject to credit risk associated with counterparties to the derivative contracts. Credit risk associated with derivatives is measured based on the replacement cost should the counterparty with a contract in a gain position to us fail to perform under the terms of the contract. While the current interest rate swap is in effect, we do not anticipate nonperformance by the counterparty.

Note 5 – Fair Value Measurements

Our financial assets and liabilities are measured at fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The carrying value of cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short-term nature of these instruments. Because of the variable-rate nature of our debt under our credit facility, our debt also approximates fair value.  

Assets and Liabilities Measured at Fair Value on a Recurring Basis.  The fair value hierarchy requires the use of observable market data when available. In instances where inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

Our financial assets that are measured at fair value on a recurring basis are an interest rate swap and assets held in a deferred compensation retirement plan. Both of these assets are classified as other long-term assets on our balance sheet, with the portion of the deferred compensation retirement plan assets expected to be paid within twelve months classified as current assets. The fair value of the interest rate swap is determined by the respective counterparties based on interest rate changes. Interest rate swaps are valued based on observable interest rate yield curves for similar instruments. The deferred compensation plan assets relate to contributions made to a non-qualified compensation plan on behalf of certain employees who are classified as “highly compensated employees” as determined by IRS guidelines. The assets are part of a rabbi trust and the funds are held in mutual funds. The fair value of the deferred compensation is based on the quoted market prices for the mutual funds at the end of the period.

The following table summarizes the balances of assets measured at fair value on a recurring basis as of April 3, 2022 and March 28, 2021.

(In thousands)		April 3, 2022		March 28, 2021
Assets
Deferred compensation plan assets	Level 1	$	7,038	$	5,946
Interest rate swap	Level 2	1,769		—

 0

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 6 – Assets Held for Sale

We have no assets classified as held for sale as of April 3, 2022. Included in assets held for sale as of March 28, 2021 was $0.7 million for an office building in St. Louis, Missouri that was utilized in the administration of our Industrial segment, and $0.2 million for a water treatment branch located in Eldridge, Iowa, which has been relocated to another owned facility. Both were sold in the first quarter of fiscal 2022. These amounts were recorded as assets held for sale within prepaid expenses and other current assets on our balance sheet.

Note 7 — Inventories

Inventories at April 3, 2022 and March 28, 2021 consisted of the following:

	2022		2021
(In thousands)
Inventory (FIFO basis)	$	116,325	$	69,438
LIFO reserve	(21,340)		(5,574)
Net inventory	$	94,985	$	63,864

The FIFO value of inventories accounted for under the LIFO method was $83.7 million at April 3, 2022 and $46.8 million at March 28, 2021. The remainder of the inventory was valued and accounted for under the FIFO method.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 8 — Goodwill and Other Identifiable Intangible Assets

The carrying amount of goodwill for each of our three reportable segments were as follows:

(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Balance as of March 29, 2020	$	6,495	$	7,000	$	44,945	$	58,440
Addition due to acquisitions	—		12,280		—		12,280
Balance as of March 28, 2021	$	6,495	$	19,280	$	44,945	$	70,720
Addition due to acquisitions	—		6,681		—		6,681
Balance as of April 3, 2022	$	6,495	$	25,961	$	44,945	$	77,401

The following is a summary of our identifiable intangible assets as of April 3, 2022 and March 28, 2021:

	2022
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	109,644	$	(32,399)	$	77,245
Trademarks and trade names	6,370		(4,746)		1,624
Other finite-life intangible assets	3,904		(3,807)		97
Total finite-life intangible assets	119,918		(40,952)		78,966
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	121,145	$	(40,952)	$	80,193

	2021
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	99,588	$	(26,522)	$	73,066
Trademarks and trade names	6,210		(4,275)		1,935
Other finite-life intangible assets	3,833		(3,693)		140
Total finite-life intangible assets	109,631		(34,490)		75,141
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	110,858	$	(34,490)	$	76,368

Intangible asset amortization expense was $6.5 million during fiscal 2022, $5.8 million during fiscal 2021, and $5.1 million during fiscal 2020.

The estimated future amortization expense for identifiable intangible assets is as follows:

(In thousands)	Intangible Assets
Fiscal 2023	$	6,923
Fiscal 2024	6,707
Fiscal 2025	6,707
Fiscal 2026	6,606
Fiscal 2027	6,305
Thereafter	45,718
Total	$	78,966

40

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 9 – Debt

On March 31, 2022, we entered into a second amended and restated credit agreement (the “Credit Agreement”) with U.S. Bank National Association (“U.S. Bank”) as Sole Lead Arranger and Sole Book Runner, and other lenders from time to time party thereto (collectively, the “Lenders”), whereby U.S. Bank is also serving as Administrative Agent. The Credit Agreement refinanced the revolving loan under our previous credit agreement with U.S. Bank and provides us with senior secured revolving credit facilities (the “Revolving Loan Facility”) totaling $250.0 million. The Revolving Loan Facility includes a $15 million letter of credit subfacility and $25 million swingline subfacility. The Revolving Loan Facility has a five-year maturity date, maturing on April 30, 2027. The Revolving Loan Facility is secured by substantially all of our personal property assets and those of our subsidiaries.

We used $126.0 million of the proceeds from the Revolving Loan Facility to refinance the obligations under the previous credit facility. We may use the remaining amount of the Revolving Loan Facility for working capital, capital expenditures, share repurchases, restricted payments and acquisitions permitted under the Credit Agreement, and other general corporate purposes.

At April 3, 2022, the effective interest rate on our borrowings was 1.2%. In addition to paying interest on the outstanding principal under the Revolving Loan Facility, we are required to pay a commitment fee on the unutilized commitments thereunder. The commitment fee is between 0.15% and 0.25%, depending on our leverage ratio.

Debt issuance costs of $0.3 million paid to the lenders in connection with the Credit Agreement, as well as unamortized debt issuance costs of $0.1 million paid in connection with the previous credit facility, are reflected as a reduction of debt and are being amortized as interest expense over the term of the Revolving Loan Facility.

The Credit Agreement requires us to maintain (a) a minimum fixed charge coverage ratio of 1.15 to 1.00 and (b) a maximum total cash flow leverage ratio of 3.0 to 1.0. The Credit Agreement also contains other customary affirmative and negative covenants, including covenants that restrict our ability to incur additional indebtedness, dispose of significant assets, make certain investments, including any acquisitions other than permitted acquisitions, make certain payments, enter into sale and leaseback transactions, grant liens on our assets or enter into rate management transactions, subject to certain limitations. We are permitted to make distributions, pay dividends and repurchase shares so long as no default or event of default exists or would exist as a result thereof. We are permitted to make distributions, pay dividends and repurchase shares so long as no default or event of default exists or would exist as a result thereof. As of April 3, 2022, we were in compliance with all required covenants.

Debt at April 3, 2022 and March 28, 2021 consisted of the following:

(In thousands)	April 3, 2022		March 28, 2021
Senior secured revolving loan	$	126,000	$	99,000
Less: unamortized debt issuance costs	(443)		(248)
Total debt, net of debt issuance costs	125,557		98,752
Less: current portion of long-term debt, net of current unamortized debt issuance costs	(9,913)		(9,907)
Total long-term debt	$	115,644	$	88,845

41

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 10 — Share-Based Compensation 

Performance-Based Restricted Stock Units.  Our Board of Directors has approved a performance-based equity compensation arrangement for our executive officers. This performance-based arrangement provides for the grant of performance-based restricted stock units that represent a possible future issuance of restricted shares of our common shares based on our pre-tax income target for the applicable fiscal year. The actual number of restricted shares to be issued to each executive officer will be determined when our final financial information becomes available after the applicable fiscal year and will be between zero shares and 88,524 shares in the aggregate for fiscal 2022. The restricted shares issued, if any, will fully vest two years after the end of the fiscal year on which the performance is based. We record the compensation expense for the outstanding performance share units and then-converted restricted stock over the life of the awards.

The following table represents the restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	65,766	$	21.83
Granted	138,504	17.25
Vested	(55,240)	23.01
Forfeited	—	—
Outstanding at end of fiscal 2020	149,030	$	17.13
Granted	129,626	18.69
Vested	(10,526)	15.68
Forfeited	(29,010)	17.92
Outstanding at end of fiscal 2021	239,120	$	17.94
Granted	111,618	31.74
Vested	(123,002)	17.25
Forfeited	(13,258)	18.69
Outstanding at end of fiscal 2022	214,478	$	25.48

The weighted average grant date fair value of performance-based restricted shares issued in fiscal 2022 was $31.74, fiscal 2021 was $18.69 and fiscal 2020 was $17.25. We recorded compensation expense on performance-based restricted stock of approximately $2.9 million for fiscal 2022, $2.5 million for fiscal 2021 and $1.5 million for fiscal 2020, substantially all of which was recorded in selling, general and administrative (“SG&A”) expense in the Consolidated Statements of Income. The total fair value of performance-based restricted stock units vested was $2.1 million in fiscal 2022, $0.2 million in fiscal 2021 and $1.3 million in fiscal 2020.

Until the performance-based restricted stock units result in the issuance of restricted stock, the amount of expense recorded each period is dependent upon our estimate of the number of shares that will ultimately be issued and our then current common share price. Upon issuance of restricted stock, we record compensation expense over the remaining vesting period using the award date closing price. Unrecognized compensation expense related to non-vested restricted stock and non-vested restricted share units as of April 3, 2022 was $3.9 million and is expected to be recognized over a weighted average period of 1.2 years.

42

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Restricted Stock Awards.  As part of their retainer, our non-employee directors receive restricted stock for their Board services. The restricted stock awards are expensed over a one-year vesting period, based on the market value on the date of grant.

The following table represents the Board’s restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	16,704	$	17.95
Granted	16,016	21.84
Vested	(16,704)	17.95
Forfeited	—	—
Outstanding at end of fiscal 2020	16,016	$	21.84
Granted	13,186	25.59
Vested	(16,016)	21.84
Forfeited	(1,958)	25.53
Outstanding at end of fiscal 2021	11,228	$	25.60
Granted	10,287	32.80
Vested	(11,228)	25.60
Forfeited	—	—
Outstanding at end of fiscal 2022	10,287	$	32.80

Annual expense related to the value of restricted stock was $0.3 million in fiscal 2022, 2021 and 2020, and was recorded in SG&A expense in the Consolidated Statements of Income. Unrecognized compensation expense related to non-vested restricted stock awards as of April 3, 2022 was $0.1 million and is expected to be recognized over a weighted average period of 0.3 years.

Note 11 — Share Repurchases

Our board of directors has authorized the repurchase of up to 1,600,000 shares of our outstanding common shares. The shares may be repurchased on the open market or in privately negotiated transactions subject to applicable securities laws and regulations. Upon repurchase of the shares, we reduce our common shares for the par value of the shares with the excess applied against additional paid-in capital. We repurchased 240,501 common shares at an aggregate purchase price of $8.5 million during fiscal 2022. We repurchased 166,088 common shares at an aggregate purchase price of $4.1 million during fiscal 2021. We repurchased 291,166 common shares at an aggregate purchase price of $5.9 million during fiscal 2020. As of April 3, 2022, the number of shares available to be purchased under the share repurchase program was 311,005.

Note 12 — Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans

Company Sponsored Plans. The majority of our non-bargaining unit employees are eligible to participate in a company-sponsored profit sharing plan. Contributions are made at our discretion subject to a maximum amount allowed under the Internal Revenue Code (“IRC”). The profit sharing plan contribution level for each employee depends upon date of hire, and was 2.5% or 5.0% of each employee’s eligible compensation for fiscal 2022, 2021 and 2020. We also have in place a retirement plan covering our collective bargaining unit employees. The retirement plan provides for a contribution of 2.5% or 5.0% of each employee’s eligible annual wages depending on their hire date. In addition to the employer contributions described above, both the profit sharing plan and the retirement plan include a 401(k) plan that allows employees to contribute pre-tax earnings up to the maximum amount allowed under the IRC, with an employer match of up to 5% of the employee’s eligible compensation.

We have two employee stock ownership plans (“ESOPs”), one covering the majority of our non-bargaining unit employees and the other covering our collective bargaining unit employees. Contributions to the plan covering our non-bargaining unit employees are made at our discretion. Contributions to both plans are subject to a maximum amount allowed under the IRC, and were 2.5% or 5.0% of each employee’s eligible wages, depending on each eligible employee’s hire date, for fiscal 2022, 2021 and 2020.

43

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

We have a nonqualified deferred compensation plan covering employees who are classified as “highly compensated employees” as determined by IRS guidelines for the plan year and who were hired on or before April 1, 2012. Employees who are eligible for the nonqualified deferred compensation plan for any plan year are not eligible for the profit sharing plan contribution or the ESOP contributions described above for that plan year. Our contribution to the nonqualified deferred compensation plan for fiscal 2022, 2021 and 2020 was 10% of each employee’s eligible compensation, subject to the maximum amount allowed under the IRC.

We have an employee stock purchase plan (“ESPP”) covering substantially all of our employees. The ESPP allows employees to purchase newly-issued shares of the Company’s common shares at a discount from market. The number of new shares issued under the ESPP was 71,692 in fiscal 2022, 88,148 in fiscal 2021 and 77,100 in fiscal 2020.

The following represents the contribution expense for these company-sponsored plans for fiscal 2022, 2021 and 2020:

(In thousands)	2022		2021		2020
Non-bargaining unit employee plans:
Profit sharing	$	1,056	$	994	$	631
401(k) matching contributions	3,122		2,650		2,399
ESOP	1,056		994		631
Nonqualified deferred compensation plan	1,355		1,327		1,262
Bargaining unit employee plans	589		555		481
ESPP - all employees	549		556		431
Total contribution expense	$	7,727	$	7,076	$	5,835

In 2013, we withdrew from a collectively bargained multiemployer pension plan and recorded a liability for our share of the unfunded vested benefits. Payments of approximately $0.5 million per year are being made through 2034.

Note 13 — Commitments and Contingencies

Litigation.  As of April 3, 2022, there were no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which we or any of our subsidiaries are a party or of which any of our property is the subject. Legal fees associated with such matters are expensed as incurred.

Asset Retirement Obligations. We have three leases of land which contain terms that state that at the end of the lease term, we have a specified amount of time to remove the property and buildings. Including available lease extensions, these leases expire in 2023, 2033 and 2044. At that time, anything that remains on the land becomes the property of the lessor, and the lessor has the option to either maintain the property or remove the property at our expense. We have not been able to reasonably estimate the fair value of the asset retirement obligations, primarily due to the combination of the following factors: certain of the leases do not expire in the near future; we have a history of extending the leases with the lessors and currently intend to do so at expiration of the lease periods; the lessors do not have a history of terminating leases with their tenants; and because it is more likely than not that the buildings will have value at the end of the lease life and therefore, may not be removed by either the lessee or the lessor. Therefore, in accordance with accounting guidance related to asset retirement and environmental obligations, we have not recorded an asset retirement obligation as of April 3, 2022. We will continue to monitor the factors surrounding the requirement to record an asset retirement obligation and will recognize the fair value of a liability in the period in which it is incurred and a reasonable estimate can be made.

44

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 14 — Income Taxes

The provisions for income taxes for fiscal 2022, 2021 and 2020 were as follows:

	2022		2021		2020
(In thousands)
Federal — current	$	14,736	$	11,169	$	8,447
State — current	5,202		4,391		3,563
Total current	19,938		15,560		12,010
Federal — deferred	(1,054)		(302)		(976)
State — deferred	(447)		(387)		(445)
Total deferred	(1,501)		(689)		(1,421)
Total provision	$	18,437	$	14,871	$	10,589

Reconciliations of the provisions for income taxes to the applicable federal statutory income tax rate for fiscal 2022, 2021 and 2020 are listed below.

	2022		2021		2020
Statutory federal income tax	21.0	%	21.0	%	21.0	%
State income taxes, net of federal deduction	5.6	%	5.9	%	5.7	%
ESOP dividend deduction on allocated shares	(0.2)	%	(0.2)	%	(0.3)	%
Other — net	(0.1)	%	(0.1)	%	0.8	%
Total	26.3	%	26.6	%	27.2	%

The tax effects of items comprising our net deferred tax liability as of April 3, 2022 and March 28, 2021 are as follows:

(In thousands)	2022		2021
Deferred tax assets:
Trade receivables	$	99	$	134
Stock compensation accruals	1,823		1,341
Pension withdrawal liability	1,250		1,344
Lease liability	2,916		3,191
Other	3,097		2,882
Total deferred tax assets	$	9,185	$	8,892
Deferred tax liabilities:
Inventories	$	(1,288)	$	(2,815)
Prepaid expenses	(937)		(864)
Excess of tax over book depreciation	(12,234)		(11,249)
Intangible assets	(14,806)		(15,269)
ROU asset	(2,864)		(3,140)
Unrealized gain on interest rate swap	(478)		—
Total deferred tax liabilities	$	(32,607)	$	(33,337)
Net deferred tax liabilities	$	(23,422)	$	(24,445)

As of April 3, 2022, the Company has determined that it is more likely than not that the deferred tax assets at April 3, 2022 will be realized either through future taxable income or reversals of taxable temporary differences.

We are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. The tax years prior to our fiscal year ended March 31, 2019 are closed to examination by the Internal Revenue Service, and with few exceptions, state and local income tax jurisdictions.

45

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 15 – Leases

Lease Obligations. As of April 3, 2022, we were obligated under operating lease agreements for certain manufacturing facilities, warehouse space, the land on which some of our facilities sit, vehicles and information technology equipment. Our leases have remaining lease terms of 1 year to 23 years, some of which include options to extend the lease for up to 15 years.

As of April 3, 2022 and March 28, 2021, our operating lease components with initial or remaining terms in excess of one year were classified on the consolidated balance sheet within right-of-use assets, short-term lease liability and long-term lease liability.

Total lease expense was $2.9 million for the twelve months ended April 3, 2022 and $2.8 million for the twelve months ended March 28, 2021, and includes leases less than 12 months in duration.

Other information related to our operating leases was as follows:

	April 3, 2022		March 28, 2021
Lease Term and Discount Rate
Weighted average remaining lease term (years)	8.91		9.73
Weighted average discount rate	2.6	%	2.7	%

Maturities of lease liabilities as of April 3, 2022 were as follows:

(In thousands)	Operating Leases
Fiscal 2023	$	1,889
Fiscal 2024	1,515
Fiscal 2025	1,450
Fiscal 2026	1,388
Fiscal 2027	1,359
Thereafter	5,171
Total	$	12,772
Less: Interest	(1,972)
Present value of lease liabilities	$	10,800

46

HAWKINS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 16 — Segment Information

We have three reportable segments: Industrial, Water Treatment and Health and Nutrition. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Product costs and expenses for each segment are based on actual costs incurred along with cost allocations of shared and centralized functions.

We evaluate performance based on operating income. Reportable segments are defined primarily by product and type of customer. Segments are responsible for the sales, marketing and development of their products and services. Other than our Health and Nutrition segment, the segments do not have separate customer service or purchasing functions. There are no intersegment sales and no operating segments have been aggregated.

Reportable Segments	Industrial		Water Treatment		Health and Nutrition		Total
(In thousands)
Fiscal Year Ended April 3, 2022:
Sales	$	386,938	$	228,133	$	159,470	$	774,541
Gross profit	59,606		54,571		32,343		146,520
Selling, general, and administrative expenses	28,127		31,357		15,842		75,326
Operating income	31,479		23,214		16,501		71,194
Identifiable assets*	$	236,934	$	143,889	$	167,034	$	547,857
Capital expenditures	$	18,812	$	8,939	$	761	$	28,512
Fiscal Year Ended March 28, 2021:
Sales	$	273,361	$	170,004	$	153,506	$	596,871
Gross profit	43,337		46,793		33,632		123,762
Selling, general, and administrative expenses	27,033		24,453		16,398		67,884
Operating income	16,304		22,340		17,234		55,878
Identifiable assets*	$	181,478	$	109,761	$	166,558	$	457,797
Capital expenditures	$	13,713	$	6,732	$	349	$	20,794
Fiscal Year Ended March 29, 2020:
Sales	$	275,224	$	159,895	$	105,079	$	540,198
Gross profit	38,936		41,902		20,079		100,917
Selling, general, and administrative expenses	24,123		19,801		15,322		59,246
Operating income	14,813		22,101		4,757		41,671
Identifiable assets*	$	173,068	$	63,506	$	139,780	$	376,354
Capital expenditures	$	14,933	$	9,160	$	456	$	24,549

* Unallocated assets not included, consisting primarily of cash and cash equivalents, investments and prepaid expenses, were $19.5 million at April 3, 2022, $14.8 million at March 28, 2021 and $13.0 million at March 29, 2020.

47

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Annual Report on Form 10-K, we conducted an evaluation, under supervision and with the participation of management, including the chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective. Disclosure controls and procedures are defined by Rules 13a-15(e) and 15d-15(e) of the Exchange Act as controls and other procedures that are designed to ensure that information required to be disclosed by us in reports filed with the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or person performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (1) pertain to maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as of April 3, 2022, based on the criteria described in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In making this assessment as of April 3, 2022, we have excluded the Texas water treatment operations acquired from NAPCO Chemical Company, Inc. on December 30, 2021. The financial statements of this business comprise less than 4% of total assets and less than 1% of total revenues in our consolidated financial amounts as of and for the year ended April 3, 2022. We have excluded this business because we have not had sufficient time to make an assessment of its internal controls using the COSO criteria in accordance with Section 404 of the Sarbanes-Oxley Act of 2002. In excluding this business from our assessment, we have considered the “Frequently Asked Questions” as set forth by the office of the Chief Accountant and the Division of Corporate Finance on June 24, 2004, as revised on September 24, 2007, which acknowledges that it may not be possible to conduct an assessment of an acquired business’s internal control over financial reporting in the period between the consummation date and the date of management’s assessment and contemplates that such business would be excluded from management’s assessment in the year of acquisition. Based on this assessment, management believes that our internal control over financial reporting was effective as of April 3, 2022.

Our independent registered public accounting firm has issued an attestation report on our internal control over financial reporting for April 3, 2022 which is included in the Report of Independent Registered Public Accounting Firm in Item 8 of this Annual Report on 10-K.

Changes in Internal Control Procedures

There was no change in our internal control over financial reporting during the fourth quarter of fiscal 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

48

ITEM 9B. OTHER INFORMATION

None.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not Applicable.

49

PART III

Certain information required by Part III is incorporated by reference from Hawkins’ definitive Proxy Statement for the Annual Meeting of Shareholders to be held on August 3, 2022 (the “2022 Proxy Statement”). Except for those portions specifically incorporated in this Form 10-K by reference to the 2022 Proxy Statement, no other portions of the 2022 Proxy Statement are deemed to be filed as part of this Form 10-K.

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Information about our Executive Officers

Our current executive officers, their ages and offices held, are set forth below:

Name	Age	Office
Patrick H. Hawkins	51	Chief Executive Officer and President
Jeffrey P. Oldenkamp	49	Executive Vice President, Chief Financial Officer and Treasurer
Richard G. Erstad	58	Vice President, General Counsel and Secretary
Drew M. Grahek	52	Vice President — Operations
Douglas A. Lange	52	Vice President — Water Treatment Group
David J. Mangine	64	Vice President — Industrial Group
Theresa R. Moran	59	Vice President — Purchasing, Logistics and Sales Support
Shirley A. Rozeboom	60	Vice President — Health and Nutrition

Patrick H. Hawkins has been our Chief Executive Officer and President and member of our board since 2011. Mr. Hawkins has held the position of President since 2010. He joined the Company in 1992 and served as the Business Director - Food and Pharmaceuticals, a position he held from 2009 to 2010. Previously he served as Business Manager - Food and Co-Extrusion Products from 2007 to 2009 and Sales Representative - Food Ingredients from 2002 to 2007. He previously served the Company in various other capacities, including Plant Manager, Quality Director and Technical Director.

Jeffrey P. Oldenkamp has been our Executive Vice President, Chief Financial Officer and Treasurer since October 2021. Mr. Oldenkamp joined Hawkins in May 2017 and assumed the role of Chief Financial Officer, Vice President and Treasurer in June 2017. Prior to joining Hawkins, Mr. Oldenkamp was with MTS Systems Corporation, a supplier of high-performance test systems and sensors, where he served as Chief Financial Officer from 2015 to May 2017 and as Vice President of Finance for the MTS Test business from 2014 to 2015, and with Nilfisk-Advance, Inc., a global manufacturer of professional cleaning equipment, where he served as Americas Operations Chief Financial Officer and Vice President from 2012 to 2014.

Richard G. Erstad has been our Vice President, General Counsel and Secretary since 2008. Mr. Erstad was General Counsel and Secretary of BUCA, Inc., a restaurant company, from 2005 to 2008. Mr. Erstad had previously been an attorney with the corporate group of Faegre & Benson LLP, a law firm, from 1996 to 2005, where his practice focused on securities law and mergers and acquisitions. He is a member of the Minnesota Bar.

Drew M. Grahek has been our Vice President - Operations since September 2018.  Prior to joining Hawkins, Mr. Grahek was Adjunct Faculty at the University of Minnesota College of Continuing Education and a Business Administrator in the Archdiocese of St. Paul and Minneapolis from June 2017 to June 2018; Director of Service Operations and Supply Chain with Ulta Beauty, Inc. from April 2016 to June 2017; and Director of Stores with Field and Stream Outdoor Stores, a division of Dick’s Sporting Goods, Inc. from July 2015 to April 2016.  Previously, he spent a total of 23 years at Target Corporation in a variety of operations, merchandising and property management positions. 

Douglas A. Lange has been our Vice President - Water Treatment Group since June 2020. Prior to attaining this position, Mr. Lange served the Company as General Manager and Product Development Manager for the Water Treatment Group after joining the company in January 2019. Prior to joining the Company, Mr. Lange was with H.B. Fuller Company, a global supplier of special adhesives, where he served as Global Marketing Manager and Product Manager for specialty markets in electronics and wood products from 2011 to January 2019. Mr. Lange served in various roles in the specialty adhesives market for a total of 21 years prior to joining the Company.

50

David J. Mangine has been our Vice President - Industrial Group since 2021. Mr. Mangine served as the Industrial Sales Manager from 2011 to 2021, after joining Hawkins in 2000 as an Account Manager.

Theresa R. Moran has been our Vice President - Purchasing, Logistics and Sales Support since June 2017. Since joining the Company in 1981, Ms. Moran has served the Company in a variety of positions, including Administration Operations Manager from 1999 to 2007, Director - Process Improvement from 2007 until 2010 and Vice President - Quality and Support from 2010 to June 2017.

Shirley A. Rozeboom was named Vice President - Health and Nutrition in April 2019. Ms. Rozeboom had held the position of Senior Vice President of Sales for Stauber since 2012. Previously, she held the positions of Director of Sales at Stauber from 2008 to 2012 and Account Executive from 2000 to 2008.

The disclosure under the headings “Election of Directors,” “Corporate Governance,” and, if applicable, “Delinquent Section 16(a) Reports” of the 2022 Proxy Statement is incorporated herein by reference.

We have adopted a Code of Business Conduct and Ethics that applies to all of our directors and employees, including our principal executive officer, principal financial officer, controller and other persons performing similar functions. We have posted the Code of Business Conduct and Ethics on our website located at www.hawkinsinc.com. Hawkins’ Code of Business Conduct and Ethics is also available in print to any shareholder who requests it in writing from our Corporate Secretary. We intend to post on our website any amendment to, or waiver from, a provision of our Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, controller and other persons performing similar functions within four business days following the date of such amendment or waiver. We are not including the information contained on our website as part of, or incorporating it by reference into, this report.

ITEM 11. EXECUTIVE COMPENSATION

The disclosure under the heading “Compensation of Executive Officers and Directors” in the 2022 Proxy Statement is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The disclosure under the headings “Security Ownership of Management and Beneficial Ownership” and “Equity Compensation Plan Information” in the 2022 Proxy Statement is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The disclosure under the headings “Election of Directors” and “Related Party Transactions” of the 2022 Proxy Statement is incorporated herein by reference.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The disclosure under the heading “Independent Registered Public Accounting Firm’s Fees” of the 2022 Proxy Statement is incorporated herein by reference.

51

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)(1)	FINANCIAL STATEMENTS OF THE COMPANY
	The following financial statements of Hawkins, Inc. are filed as part of this Annual Report on Form 10-K:
	Reports of Independent Registered Public Accounting Firms.
	Consolidated Balance Sheets at April 3, 2022 and March 28, 2021.
	Consolidated Statements of Income for the fiscal years ended April 3, 2022, March 28, 2021 and March 29, 2020.
	Consolidated Statements of Comprehensive Income for the fiscal years ended April 3, 2022, March 28, 2021 and March 29, 2020.
	Consolidated Statements of Shareholders’ Equity for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020.
	Consolidated Statements of Cash Flows for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020.
	Notes to Consolidated Financial Statements.
(a)(2)	FINANCIAL STATEMENT SCHEDULES OF THE COMPANY
	The additional financial data listed below is included as a schedule to this Annual Report on Form 10-K and should be read in conjunction with the financial statements presented in Part II, Item 8. Schedules not included with this additional financial data have been omitted because they are not required, or the required information is included in the financial statements or the notes.
	The following financial statement schedule for the fiscal years 2022, 2021 and 2020.
	Schedule II — Valuation and Qualifying Accounts.
(a)(3)	EXHIBITS

52

Exhibit Index

 

Exhibit	Description	Method of Filing
3.1	Restated Articles of Incorporation. (1)	Incorporated by Reference
3.2	Amended and Restated By-Laws. (2)	Incorporated by Reference
4.1	Description of Securities. (3)	Incorporated by Reference
10.1*	Hawkins, Inc. 2010 Omnibus Incentive Plan. (4)	Incorporated by Reference
10.2*	Hawkins, Inc. Executive Severance Plan. (5)	Incorporated by Reference
10.3*	Employee Stock Purchase Plan, as amended. (6)	Incorporated by Reference
10.4	Second Amended and Restated Credit Agreement, dated as of March 31, 2022, among the Company, U.S. Bank National Association, and certain financial institutions. (7)	Incorporated by Reference
10.5*	Hawkins, Inc. 2019 Equity Incentive Plan. (8)	Incorporated by Reference
10.6*	Form of Performance Stock Unit Award Notice and Restricted Stock Agreement under the Company’s 2019 Equity Incentive Plan. (9)	Incorporated by Reference
10.7*	Nine Year LTI with Shirley Rozeboom. (10)	Incorporated by Reference
16.1	Correspondence from KPMG LLP dated February 11, 2020. (11)	Incorporated by Reference
21	Subsidiaries of the registrant.	Filed Electronically
23.1	Consent of Grant Thornton LLP.	Filed Electronically
23.2	Consent of KPMG LLP.	Filed Electronically
24.1	Powers of Attorney.	Filed Electronically
31.1	Certification by Chief Certification by Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act. Officer pursuant to Rule 13a-14(a) of the Exchange Act.	Filed Electronically
31.2	Certification by Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act.	Filed Electronically
32.1	Section 1350 Certification by Chief Executive Officer.	Filed Electronically
32.2	Section 1350 Certification by Chief Financial Officer.	Filed Electronically
101	Financial statements from the Annual Report on Form 10-K of Hawkins, Inc. for the period ended April 3, 2022, filed with the SEC on May 18, 2022, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Consolidated Balance Sheets at April 3, 2022 and March 28, 2021 (ii) the Consolidated Statements of Income for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020, (iii) the Consolidated Statements of Comprehensive Income for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020, (iv) the Consolidated Statements of Shareholders’ Equity for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020, (v) Consolidated Statements of Cash Flows for the fiscal years ended April 3, 2022, March 28, 2021, and March 29, 2020, and (iv) Notes to Consolidated Financial Statements.	Filed Electronically
104	Cover Page Interactive Data File (embedded within the inline XBRL document)	Filed Electronically

* Management contract or compensation plan or arrangement required to be filed as an exhibit to this Annual Report on Form 10-K.

(1)Incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K dated February 26, 2021 and filed March 2, 2021.

(2)Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated October 28, 2009 and filed November 3, 2009.

(3)Incorporated by reference to Exhibit 4.1 to the Company’s Annual Report on Form 10-K filed June 2,2021.

(4)Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed June 6, 2011.

(5)Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 3, 2011.

(6)Incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 filed November 2, 2018.

(7)Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form 8-K filed December 3, 2018.

(8)Incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 29, 2019.

(9)Incorporated by reference to Exhibit 10.10 to the Company’s Annual Report on Form 10-K filed May 20,2020.

(10)Incorporated by reference to Exhibit 10.7 to the Company’s Annual Report on Form 10-K filed June 2,2021.

(11)Incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K dated February 11, 2020.

ITEM 16. FORM 10-K SUMMARY

None

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		HAWKINS, INC.
		By	/s/  Patrick H. Hawkins
			Patrick H. Hawkins Chief Executive Officer and President
Dated:	May 18, 2022

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Patrick H. Hawkins		May 18, 2022
Patrick H. Hawkins	Chief Executive Officer, President and Director
	(principal executive officer)
/s/ Jeffrey P. Oldenkamp		May 18, 2022
Jeffrey P. Oldenkamp	Executive Vice President and Chief Financial Officer
	(principal financial officer and principal accounting officer)
*	Director	May 18, 2022
James A. Faulconbridge
*	Director	May 18, 2022
Mary J. Schumacher
*	Director	May 18, 2022
Jeffrey E. Spethmann
*	Director	May 18, 2022
Daniel J. Stauber
*	Director	May 18, 2022
Yi "Faith" Tang
*	Director	May 18, 2022
James T. Thompson
*	Director	May 18, 2022
Jeffrey L. Wright

* Patrick H. Hawkins, by signing his name hereto, does hereby sign this document on behalf of each of the above-named directors of the registrant pursuant to Powers of Attorney duly executed by such persons.

By:	/s/ Patrick H. Hawkins
	Patrick H. Hawkins
	Attorney-in-fact

SCHEDULE II

HAWKINS, INC.

VALUATION AND QUALIFYING ACCOUNTS

FOR THE FISCAL YEARS ENDED April 3, 2022, March 28, 2021 AND March 29, 2020

 

			Additions
Description	Balance at Beginning of Year		Charged to Costs and Expenses		Charged to Other Accounts		Deductions Write-Offs		Balance at End of  Year
	(In thousands)
Reserve deducted from asset to which it applies:
Fiscal Year Ended April 3, 2022:
Allowance for credit losses	$	497	$	—	$	—	$	(130)	$	367
Fiscal Year Ended March 28, 2021:
Allowance for credit losses	$	784	$	—	$	—	$	(287)	$	497
Fiscal Year Ended March 29, 2020:
Allowance for credit losses	$	620	$	448	$	—	$	(284)	$	784

EX-21

Exhibit 21

Subsidiaries of Hawkins, Inc.

Subsidiary	State of Organization
Stauber Holdings, Inc.	Minnesota
Stauber Performance Ingredients, Inc., a subsidiary of Stauber Holdings, Inc.	Minnesota
NAPCO Chemical Company, Inc.	Minnesota

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Hawkins, Inc.:

We have issued our reports dated May 18, 2022, with respect to the consolidated financial statements and internal control over financial reporting included in the Annual Report of Hawkins, Inc. on Form 10-K for the year ended April 3, 2022. We consent to the incorporation by reference of said reports in the Registration Statements of Hawkins, Inc. on Forms S-8 (File Nos. 333-87582, 333-123080, 333-172761, 333-174735, 333-228128 and 333-234432).

/s/ Grant Thornton LLP

Minneapolis, Minnesota

May 18, 2022

EX-23.2

Exhibit 23.2

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Hawkins, Inc.:

We consent to the incorporation by reference in the registration statements (No. 333-87582, 333-123080, 333-172761, 333-174735, 333-228128, 333-234432) on Form S-8 of our report dated May 20, 2020, except as to the stock split and par value adjustment as described in Note 1, which are as of June 2, 2021, with respect to the consolidated financial statements of Hawkins, Inc.

/s/ KPMG LLP

Minneapolis, Minnesota

May 18, 2022

EX-24.1

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ James A. Faulconbridge

James A. Faulconbridge

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ Mary J. Schumacher

Mary J. Schumacher

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ Jeffrey E. Spethmann

Jeffrey E. Spethmann

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ Daniel J. Stauber

Daniel J. Stauber

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ Yi “Faith” Tang

Yi “Faith” Tang

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ James T. Thompson

James Thompson

April 27, 2022

HAWKINS, INC.

Power of Attorney

The undersigned director of Hawkins, Inc., a Minnesota corporation (the “Company”), does hereby make, constitute and appoint Patrick H. Hawkins and Jeffrey P. Oldenkamp, and either of them, the undersigned’s true and lawful attorneys-in-fact and agents, with power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director of the Company to an Annual Report on Form 10-K for the fiscal year ended April 3, 2022 or other applicable form, and any amendments thereto, to be filed by the Company with the U.S. Securities and Exchange Commission, Washington, D.C. (the “SEC”), and to file the same with all exhibits thereto and other supporting documents in connection therewith with the SEC, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and to perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted.

IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney as of the date set forth below.

/s/ Jeffrey L. Wright

Jeffrey L. Wright

April 27, 2022

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATIONS

I, Patrick H. Hawkins, certify that:

1.I have reviewed this annual report on Form 10-K of Hawkins, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 18, 2022

/s/ Patrick H. Hawkins

Patrick H. Hawkins

Chief Executive Officer and President

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

CERTIFICATIONS

I, Jeffrey P. Oldenkamp, certify that:

1.I have reviewed this annual report on Form 10-K of Hawkins, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 18, 2022

/s/ Jeffrey P. Oldenkamp

Jeffrey P. Oldenkamp

Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Hawkins, Inc. (the Company) on Form 10-K for the period ended April 3, 2022, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Patrick H. Hawkins, Chief Executive Officer and President of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;

and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Patrick H. Hawkins

Patrick H. Hawkins

Chief Executive Officer and President

May 18, 2022

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Hawkins, Inc. (the Company) on Form 10-K for the period ended April 3, 2022, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Jeffrey P. Oldenkamp, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;

and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Jeffrey P. Oldenkamp

Jeffrey P. Oldenkamp

Executive Vice President and Chief Financial Officer

May 18, 2022

XML

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Apr. 03, 2022	Mar. 29, 2020	May 13, 2022	Sep. 26, 2021
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Apr. 03, 2022
Document Transition Report	false
Entity File Number	0-7647
Entity Registrant Name	HAWKINS, INC.
Entity Incorporation, State or Country Code	MN
Entity Tax Identification Number	41-0771293
Entity Address, Address Line One	2381 Rosegate
Entity Address, City or Town	Roseville
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55113
City Area Code	612
Local Phone Number	331-6910
Title of 12(b) Security	Common Shares, par value $.01 per share
Trading Symbol	HWKN
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float				$ 706.8
Entity Common Stock, Shares Outstanding			21,078,132
Entity Central Index Key	0000046250
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--04-03
Auditor Firm ID	248	185
Auditor Name	GRANT THORNTON LLP	KPMG LLP
Auditor Location	Minneapolis, Minnesota	Minneapolis, Minnesota

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
CURRENT ASSETS:
Cash and cash equivalents	$ 3,496	$ 2,998
Trade accounts receivables, net	122,826	90,603
Inventories	94,985	63,864
Prepaid expenses and other current assets	6,431	5,542
Total current assets	227,738	163,007
PROPERTY, PLANT, AND EQUIPMENT:
Land	16,640	15,235
Buildings and improvements	118,369	120,410
Machinery and equipment	114,763	109,353
Transportation equipment	43,968	37,646
Office furniture and equipment	10,315	17,760
Property, plant and equipment, gross	304,055	300,404
Less accumulated depreciation	142,209	155,792
Net property, plant, and equipment	161,846	144,612
OTHER ASSETS:
Right-of-use assets	10,606	11,630
Goodwill	77,401	70,720
Intangible assets, net	80,193	76,368
Deferred compensation plan asset	6,783	5,726
Other	2,761	487
Total other assets	177,744	164,931
Total assets	567,328	472,550
CURRENT LIABILITIES:
Accounts payable — trade	66,693	37,313
Accrued payroll and employee benefits	19,034	18,048
Current portion of long-term debt	9,913	9,907
Short-term lease liability	1,657	1,587
Container deposits	1,558	1,452
Other current liabilities	2,611	2,155
Total current liabilities	101,466	70,462
LONG-TERM DEBT, LESS CURRENT PORTION	115,644	88,845
LONG-TERM LEASE LIABILITY	9,143	10,231
PENSION WITHDRAWAL LIABILITY	4,276	4,631
DEFERRED INCOME TAXES	23,422	24,445
DEFERRED COMPENSATION LIABILITY	8,402	7,322
OTHER LONG-TERM LIABILITIES	2,374	1,368
Total liabilities	264,727	207,304
Commitments and Contingencies
SHAREHOLDERS’ EQUITY:
Common shares; authorized: 60,000,000 shares of $0.01 par value; 20,889,777 and 20,969,746 shares issued and outstanding for 2022 and 2021, respectively	209	210
Additional paid-in capital	46,717	51,138
Retained earnings	254,384	213,898
Accumulated other comprehensive income	1,291	0
Total shareholders’ equity	302,601	265,246
Total liabilities and shareholders’ equity	$ 567,328	$ 472,550

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Apr. 03, 2022	Mar. 28, 2021
Statement of Financial Position [Abstract]
Common stock, shares authorized (shares)	60,000,000
Common Stock, Par or Stated Value Per Share	$ 0.01
Common Stock, Shares, Issued	20,889,777	20,969,746
Common Stock, Shares, Outstanding	20,889,777	20,969,746

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Condensed Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Sales	$ 774,541	$ 596,871	$ 540,198
Cost of sales	(628,021)	(473,109)	(439,281)
Gross profit	146,520	123,762	100,917
Selling, general and administrative expenses	(75,326)	(67,884)	(59,246)
Operating income	71,194	55,878	41,671
Interest expense, net	(1,404)	(1,467)	(2,511)
Other income (expense)	189	1,440	(204)
Income before income taxes	69,979	55,851	38,956
Income tax expense	(18,437)	(14,871)	(10,589)
Net income	$ 51,542	$ 40,980	$ 28,367
Weighted average number of shares outstanding-basic	20,947,234	21,024,344	21,159,978
Weighted average number of shares outstanding-diluted	21,135,258	21,260,296	21,308,800
Earnings Per Share
Basic earnings per share	$ 2.46	$ 1.95	$ 1.34
Diluted earnings per share
Diluted earnings per share	2.44	1.93	1.33
Cash dividends declared per common share	$ 0.52250	$ 0.47125	$ 0.46125

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Statement of Comprehensive Income [Abstract]
Net income	$ 51,542	$ 40,980	$ 28,367
Unrealized gain (loss) on interest rate swap	1,291	79	(396)
Total other comprehensive income (loss)	1,291	79	(396)
Total comprehensive income	$ 52,833	$ 41,059	$ 27,971

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Consolidated Statements of Shareholders' Equity and Comprehensive Income (Loss) Statement - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Shares outstanding, beginning balance at Mar. 31, 2019		21,184,900
Stockholders' equity, beginning balance at Mar. 31, 2019	$ 217,861	$ 212	$ 52,927	$ 164,405	$ 317
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared	(9,825)	0	0	(9,825)	0
Share-based compensation expense	2,273	$ 0	2,273	0	0
Vesting of restricted stock (shares)		71,944
Vesting of restricted stock	0	$ 0	0	0	0
Shares surrendered for payroll taxes (shares)		(18,320)
Shares surrendered for payroll taxes	(343)	$ 0	(343)	0	0
ESPP shares issued (shares)		77,100
ESPP shares issued	1,400	$ 1	1,399	0	0
Shares repurchased (Shares)		(291,166)
Shares repurchased	(5,853)	$ (2)	(5,851)	0	0
Other comprehensive loss, net of tax	(396)	0	0	0	(396)
Net income	28,367	$ 0	0	28,367	0
Shares outstanding, ending balance at Mar. 29, 2020		21,024,458
Stockholders' equity, ending balance at Mar. 29, 2020	233,484	$ 211	50,405	182,947	(79)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared	(10,029)	0	0	(10,029)	0
Share-based compensation expense	3,343	$ 0	3,343	0	0
Vesting of restricted stock (shares)		26,542
Vesting of restricted stock	0	$ 0	0	0	0
Shares surrendered for payroll taxes (shares)		(3,314)
Shares surrendered for payroll taxes	(54)	$ 0	(54)	0	0
ESPP shares issued (shares)		88,148
ESPP shares issued	1,583	$ 1	1,582	0	0
Shares repurchased (Shares)		(166,088)
Shares repurchased	(4,140)	$ (2)	(4,138)	0	0
Other comprehensive loss, net of tax	79	0	0	0	79
Net income	40,980	$ 0	0	40,980	0
Shares outstanding, ending balance at Mar. 28, 2021		20,969,746
Stockholders' equity, ending balance at Mar. 28, 2021	265,246	$ 210	51,138	213,898	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Cash dividends declared	(11,056)	0	0	(11,056)	0
Share-based compensation expense	3,818	$ 0	3,818	0	0
Vesting of restricted stock (shares)		134,230
Vesting of restricted stock	0	$ 1	(1)	0	0
Shares surrendered for payroll taxes (shares)		(45,390)
Shares surrendered for payroll taxes	(1,467)	$ 0	(1,467)	0	0
ESPP shares issued (shares)		71,692
ESPP shares issued	1,772	$ 0	1,772	0	0
Shares repurchased (Shares)		(240,501)
Shares repurchased	(8,545)	$ (2)	(8,543)	0	0
Other comprehensive loss, net of tax	1,291	0	0	0	1,291
Net income	51,542	$ 0	0	51,542	0
Shares outstanding, ending balance at Apr. 03, 2022		20,889,777
Stockholders' equity, ending balance at Apr. 03, 2022	$ 302,601	$ 209	$ 46,717	$ 254,384	$ 1,291

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 51,542	$ 40,980	$ 28,367
Reconciliation to cash flows provided by operating activities:
Depreciation and amortization	24,129	22,669	21,584
Operating leases	1,899	1,896	2,033
(Gain) loss on deferred compensation assets	(189)	(1,440)	233
Deferred income taxes	(1,501)	(689)	(1,421)
Stock compensation expense	3,818	3,343	2,273
Other	545	203	656
Changes in operating accounts (using) providing cash, net of acquisitions:
Trade receivables	(30,526)	(21,323)	(3,387)
Inventories	(30,034)	(7,960)	6,045
Accounts payable	25,138	2,551	4,228
Accrued liabilities	2,723	7,554	663
Lease liabilities	1,907	1,837	2,025
Income taxes	214	(235)	586
Other	(3,014)	(1,919)	(933)
Net cash provided by operating activities	42,837	43,793	58,902
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant, and equipment	(28,512)	(20,794)	(24,549)
Acquisitions	(21,546)	(51,000)	0
Other	302	362	346
Net cash used in investing activities	(49,756)	(71,432)	(24,203)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends paid	(11,056)	(10,029)	(9,825)
New shares issued	1,772	1,583	1,400
Shares surrendered for payroll taxes	(1,467)	(54)	(343)
Shares repurchased	(8,545)	(4,140)	(5,853)
Payments for debt issuance costs	(287)	0	0
Payments on senior secured revolving loan	(15,000)	(37,000)	(44,000)
Borrowings on senior secured revolving loan	42,000	76,000	19,000
Net cash provided by (used in) financing activities	7,417	26,360	(39,621)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	498	(1,279)	(4,922)
CASH AND CASH EQUIVALENTS - beginning of year	2,998	4,277	9,199
CASH AND CASH EQUIVALENTS - end of year	3,496	2,998	4,277
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION-
Cash paid during the year for income taxes	19,726	15,783	11,415
Cash paid for interest	1,197	1,288	2,413
Noncash investing activities - Capital expenditures in accounts payable	$ 3,733	$ 626	$ 1,041

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Nature of Business and Significant Accounting Policies

12 Months Ended

Apr. 03, 2022

Accounting Policies [Abstract]

Nature of Business and Significant Accounting Policies

Nature of Business and Significant Accounting Policies

Nature of Business - We have three reportable segments: Industrial, Water Treatment and Health and Nutrition. The Industrial Group specializes in providing industrial chemicals, products and services to industries such as agriculture, chemical processing, electronics, energy, food, pharmaceutical and plating. This group also manufactures and sells certain food-grade products, including liquid phosphates, lactates and other blended products. The Water Treatment Group specializes in providing chemicals, products, equipment, services and solutions for potable water, municipal and industrial wastewater, industrial process water and non-residential swimming pool water. This group has the resources and flexibility to treat systems ranging in size from a single small well to a multi-million-gallon-per-day facility. Our Health and Nutrition Group specializes in providing ingredient distribution, processing and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, health and wellness products. This group offers a diverse product portfolio including minerals, botanicals and herbs, vitamins and amino acids, excipients, joint products, sweeteners and enzymes.

Fiscal Year - Our fiscal year is a 52 or 53-week year ending on the Sunday closest to March 31. Our fiscal 2022 was 53 weeks and our fiscal 2021 fiscal 2020 were both 52 weeks. Fiscal 2023 will be 52 weeks.

Principles of Consolidation - The consolidated financial statements include the accounts of Hawkins, Inc. and its wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated.

Estimates - The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, particularly receivables, inventories, property, plant and equipment, right-of-use assets, goodwill, intangibles, accrued expenses, short-term and long-term lease liability, income taxes and related accounts and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition - Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. Revenue is recognized when we satisfy our performance obligations under the contract. We recognize revenue upon transfer of control of the promised products to the customer, with revenue recognized at the point in time the customer obtains control of the products. Net sales include products and shipping charges, net of estimates for product returns and any related sales rebates. We estimate product returns based on historical return rates. Using probability assessments, we estimate sales rebates expected to be paid over the term of the contract. The majority of our contracts have a single performance obligation and are short term in nature. Sales taxes that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. We offer certain customers cash discounts and volume rebates as sales incentives. The discounts and volume rebates are recorded as a reduction in sales at the time revenue is recognized in an amount estimated based on historical experience and contractual obligations.

Shipping and Handling - All shipping and handling amounts billed to customers are included in revenues. Costs incurred related to the shipping and the handling of products are included in cost of sales.

Fair Value Measurements - The financial assets and liabilities that are re-measured and reported at fair value for each reporting period are an interest rate swap and marketable securities. There are no fair value measurements with respect to nonfinancial assets or liabilities that are recognized or disclosed at fair value in our consolidated financial statements on a recurring basis.

Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1:  Valuation is based on quoted prices in active markets for identical assets or liabilities.

Level 2:  Valuation is based on quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for the asset or liability.

Level 3:  Valuation is based upon unobservable inputs for the asset or liability that are supported by little or no market activity. These fair values are determined using pricing models for which the assumptions utilize management’s estimates or market participant assumptions.

In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Cash Equivalents - Cash equivalents include all liquid debt instruments (primarily cash funds and money market accounts) purchased with an original maturity of three months or less. The cash balances, maintained at large commercial banking institutions with strong credit ratings, may, at times, exceed federally insured limits.

Trade Receivables and Concentrations of Credit Risk - Financial instruments, which potentially subject us to a concentration of credit risk, principally consist of trade receivables. We sell our principal products to a large number of customers in many different industries. As of April 3, 2022, we had a significant concentration of credit risk, with a single customer representing approximately 13% of our total trade receivables. There are no other concentrations of credit risk with other single customers from a particular service or geographic area that would significantly impact us in the near term.

To reduce credit risk, we routinely assess the financial strength of our customers. Receivables are reported net of an allowance for credit losses as determined by management at the end of each reporting period. Our receivable allowance in based on an estimate of expected credit losses, with the estimate based on a number of qualitative and quantitative factors that, based on collection experience, may have an impact on repayment risk and ability to collect.

Inventories - Inventories, consisting primarily of finished goods, are primarily valued at the lower of cost or net realizable value, with cost for approximately 73% of our inventory determined using the last-in, first-out (“LIFO”) method. Cost for the other 27% of our total inventory is determined using the first-in, first-out (“FIFO”) method.

Leases - We determine if an arrangement is a lease at inception. Right-of-use ("ROU") assets include operating leases. Lease liabilities for operating leases are classified in "short-term lease liabilities" and "long-term lease liabilities" in our consolidated balance sheet.

ROU assets and related liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Lease and non-lease components are generally accounted for separately for real estate leases. For non-real estate leases, we account for the lease and non-lease components as a single lease component.

Property, Plant and Equipment - Property is stated at cost and depreciated or amortized over the lives of the assets, using the straight-line method. Estimated lives are: 10 to 40 years for buildings and improvements; 3 to 20 years for machinery and equipment; and 3 to 10 years for transportation equipment and office furniture and equipment including computer systems. Leasehold improvements are amortized over the lesser of their estimated useful lives or the remaining lease term. Depreciation and amortization expense is recorded in our Consolidated Statement of Income within cost of goods sold and selling, general and administrative expense, depending on the use of the underlying asset. We recorded depreciation expense of $17.7 million for fiscal 2022, $16.8 million for fiscal 2021 and $16.5 million for fiscal 2020.

Significant improvements that add to productive capacity or extend the lives of properties are capitalized. Costs for repairs and maintenance are charged to expense as incurred. When property is retired or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts and any related gains or losses are included in income.

We review the recoverability of long-lived assets to be held and used, such as property, plant and equipment, when events or changes in circumstances occur that indicate the carrying value of the asset group may not be recoverable, such as prolonged industry downturn or significant reductions in projected future cash flows. The assessment of possible impairment is based on our ability to recover the carrying value of the asset group from the expected future pre-tax cash flows (undiscounted) of the related asset group. If these cash flows are less than the carrying value of such asset group, an impairment loss would be measured by the amount the carrying value exceeds the fair value of the long-lived asset group. The measurement of impairment requires us to estimate future cash flows and the fair value of long-lived assets. We did not incur any asset write-off charge in fiscal 2022 related to the impairment of long-lived assets. Asset write-off charges were $0.2 million during fiscal 2021 and $0.6 million during fiscal 2020.

Goodwill and Identifiable Intangible Assets - Goodwill represents the excess of the cost of acquired businesses over the fair value of identifiable tangible net assets and identifiable intangible assets purchased. Goodwill is tested at least annually for impairment, and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. Our annual test for impairment is as of the first day of our fourth fiscal quarter. As of December 27, 2021, we performed an analysis of qualitative factors for our Industrial, Water Treatment and Health and Nutrition reporting units to determine whether it is more likely than not that the fair value of either of these reporting units was less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform a quantitative goodwill impairment test for any of these reporting units.

Goodwill impairment assessments were also completed in the fourth quarters of fiscal 2021 and 2020 and similarly, we did not record a goodwill impairment charge.

Our primary identifiable intangible assets include customer lists, trade secrets, non-competition agreements, trademarks and trade names acquired in previous business acquisitions. Identifiable intangible assets with finite lives are amortized whereas identifiable intangible assets with indefinite lives are not amortized. The values assigned to the intangible assets with finite lives are being amortized on average over a remaining useful life of approximately 12 years. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. No such events or changes in circumstances occurred during fiscal 2022, 2021 or 2020. Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. The impairment test consists of a qualitative assessment to determine whether it is more likely than not that the asset is impaired. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform an annual quantitative impairment test for fiscal 2022, 2021 or 2020.

Income Taxes - We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income tax expense in the period that includes the enactment date. The deferred tax assets and liabilities are analyzed regularly, and management assesses the likelihood that deferred tax assets will be recovered from future taxable income. We record any interest and penalties related to income taxes as income tax expense in the consolidated statements of income.

We recognize the effect of income tax positions only if those positions are more-likely-than-not to be sustained. Recognized income tax positions are measured at the largest amount of tax with a greater than 50 percent likelihood of being realized upon ultimate settlement with the related tax authority. Changes in recognition or measurement are reflected in the period in which the facts and circumstances change.

Stock-Based Compensation - We account for stock-based compensation on a fair value basis. The estimated grant date fair value of each stock-based award is recognized in expense over the requisite service period (generally the vesting period). Non-vested share awards are recorded as expense over the requisite service periods based on the stock price on the date of grant.

Earnings Per Share - Basic earnings per share (“EPS”) are computed by dividing net income by the weighted-average number of common shares outstanding. Diluted EPS are computed by dividing net income by the weighted-average number of common shares outstanding including the incremental shares assumed to be issued as performance units and restricted stock. Basic and diluted EPS were calculated using the following:

	April 03, 2022	March 28, 2021	March 29, 2020
Weighted average common shares outstanding — basic	20,947,234	21,024,344	21,159,978
Dilutive impact of stock performance units and restricted stock	188,024	235,952	148,822
Weighted average common shares outstanding — diluted	21,135,258	21,260,296	21,308,800

There were no shares or stock options excluded from the calculation of weighted average common shares for diluted EPS for fiscal 2022, 2021 or 2020.

Stock Split - In fiscal 2021, we effected a two-for-one stock split of our common stock and adjusted the par value of our common stock to $.01 par value. Our consolidated financial statements, related notes, and other financial data contained in this report have been adjusted to give retroactive effect to the stock split for all periods presented.

Derivative Instruments and Hedging Activities - We are subject to interest rate risk associated with our variable rate debt. We have in place an interest rate swap agreement which has been designated as a cash flow hedge, the purpose of which is to eliminate the cash flow impact of interest rate changes on a portion of our variable-rate debt. The interest rate swap is measured at fair value on the contract date and is subsequently remeasured to fair value at each reporting date. Changes in the fair value of a derivative that is highly effective, and that is designated and qualifies as a cash flow hedge, are recorded in other comprehensive income, until the consolidated statement of income is affected by the variability in cash flows of the designated hedged item. To the extent that the hedge is ineffective, changes in the fair value are recognized in the Statement of Income.

Recently Issued Accounting Pronouncements

We do not expect that any recently issued accounting pronouncements will have a material effect on our financial statements.

Recently Adopted Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes, removing certain exceptions for investments, intra-period allocations and interim calculations and adding guidance to reduce complexity in accounting for income taxes. We adopted this guidance at the beginning of fiscal 2022. Our adoption of this ASU did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.

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Acquisitions

12 Months Ended

Apr. 03, 2022

Business Combination and Asset Acquisition [Abstract]

Business Combination Disclosure

Acquisitions

Acquisition of NAPCO Chemical Company, Inc.: On December 30, 2021, we acquired substantially all the assets of NAPCO Chemical Company, Inc. ("NAPCO"), under the terms of an asset purchase agreement with NAPCO and certain other parties thereto, to further the geographic reach of our Water Treatment segment. We paid $18.5 million at closing for the acquisition, and an additional $0.5 million for a working capital adjustment. NAPCO manufactures and distributes water treatment chemicals from three locations in Texas. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of NAPCO acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $19 million purchase price, we allocated $9.4 million to finite-lived intangible assets, primarily customer relationships to be amortized over 18 years, $3.6 million to property, plant and equipment and $1.5 million to net working capital. The residual amount of $4.5 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

Acquisition of Water and Waste Specialties, Inc.: On October 29, 2021, we acquired substantially all the assets of Water and Waste Specialties, Inc., under the terms of a purchase agreement with Water and Waste Specialties and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $1.4 million at closing for the acquisition. Water and Waste Specialties was a water treatment chemical distribution company operating primarily in Alabama. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of Water and Waste Specialties acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $1.4 million purchase price, we allocated $0.5 million to finite-lived intangible assets, primarily customer relationships to be amortized over 11 years, and $0.4 million to property, plant and equipment. The residual amount of $0.5 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

Acquisition of Southeast Water Systems LLC: On September 20, 2021, we acquired substantially all the assets of Southeast Water Systems LLC, under the terms of an asset purchase agreement with Southeast Water Systems and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $1.2 million at closing for the acquisition and may pay up to an additional $1.0 million over the next three years based on achieving certain goals. Southeast Water Systems supplied and installed water treatment chemical equipment to its customers located primarily in Alabama, southern Georgia and the Florida panhandle. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of Southeast Water Systems acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the total $2.2 million purchase price, which includes a contingent consideration liability of $1.0 million, we allocated $0.4 million to finite-lived intangible assets, primarily customer relationships to be amortized over 10 years, and $0.1 million to property, plant and equipment. The residual amount of $1.7 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes. The purchase price allocation is final.

Acquisition of C&L Aqua Professionals, Inc. and LC Blending, Inc.: In fiscal 2021, we acquired substantially all the assets of C&L Aqua Professionals, Inc. and LC Blending, Inc. (together, "C&L Aqua") under the terms of an asset purchase agreement among us, C&L Aqua and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $16 million for the acquisition. C&L Aqua was a water treatment chemical distribution company operating primarily in Louisiana. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of C&L Aqua acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the $16 million purchase price, we preliminarily allocated $8.2 million to finite-lived intangible assets, primarily customer relationships to be amortized over 18 years, $3.6 million to property, plant and equipment, and $1.1 million to net working capital. The residual amount of $3.1 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes.

Acquisition of Property: In fiscal 2021, we acquired a manufacturing facility on 28 acres located adjacent to our facility in Rosemount, Minnesota to allow further expansion and growth in both our Industrial and Water Treatment segments. We paid $10 million for the property. The purchase of this facility adds approximately 40,000 square feet of manufacturing and warehouse space to bring us to a total of 105,000 square feet of space on 56 acres of land in the area, with rail access at both of the sites to allow for future growth and provide for supply chain flexibility on certain raw materials to better serve our customers.

This acquisition has been accounted for as an asset acquisition, under which the total purchase price is allocated to the net tangible assets acquired based on their estimated fair values. Of the $10 million purchase price, $4.6 million was allocated to buildings, $3.7 million was allocated to land, $1.4 million was allocated to equipment, and $0.3 million was allocated to site improvements.

Acquisition of American Development Corporation of Tennessee, Inc.: In fiscal 2021, we acquired substantially all the assets of American Development Corporation of Tennessee, Inc. (“ADC”) under the terms of an asset purchase agreement among us, ADC and its shareholders, to further the geographic reach of our Water Treatment segment. We paid $25 million for the acquisition. ADC was a water treatment chemical distribution company operating primarily in Tennessee, Georgia and Kentucky. The results of operations since the acquisition date, and the assets, including the goodwill associated with this acquisition, are included in our Water Treatment segment. Costs associated with this transaction were not material and were expensed as incurred.

The acquisition has been accounted for as a business combination, under which the total purchase price is allocated to the net tangible and intangible assets and liabilities of ADC acquired in connection with the acquisition based on their estimated fair values. We estimated the fair values of the assets acquired and liabilities assumed using a discounted cash flow analysis (income approach). Of the $25 million purchase price, we allocated $13.3 million to finite-lived intangible assets, primarily customer relationships to be amortized over 17 years, $1.6 million to property, plant and equipment, and $0.9 million to net working capital. The residual amount of $9.2 million was allocated to goodwill. The goodwill recognized as a result of this acquisition is primarily attributable to strategic and synergistic benefits, as well as the assembled workforce. Such goodwill is expected to be deductible for tax purposes.

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Revenue

12 Months Ended

Apr. 03, 2022

Revenue [Abstract]

Revenue from Contract with Customer

Revenue

Our revenue arrangements generally consist of a single performance obligation to transfer promised goods or services. We disaggregate revenues from contracts with customers by both operating segments and types of product sold. Reporting by operating segment is pertinent to understanding our revenues, as it aligns to how we review the financial performance of our operations. Types of products sold within each operating segment help us to further evaluate the financial performance of our segments.

The following table disaggregates external customer net sales by major revenue stream:

	Fiscal Year Ended April 3, 2022:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	318,514	$	205,350	$	34,690	$	558,554
Distributed specialty products (2)	—		—		124,312		124,312
Bulk products (3)	61,443		20,211		—		81,654
Other	6,981		2,572		468		10,021
Total external customer sales	$	386,938	$	228,133	$	159,470	$	774,541
	Fiscal Year Ended March 28, 2021:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	231,427	$	152,694	$	38,270	$	422,391
Distributed specialty products (2)	—		—		115,317		115,317
Bulk products (3)	38,378		16,067		—		54,445
Other	3,556		1,243		(81)		4,718
Total external customer sales	$	273,361	$	170,004	$	153,506	$	596,871
	Fiscal Year Ended March 29, 2020:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	222,161	$	139,917	$	14,770	$	376,848
Distributed specialty products (2)	—		—		90,065		90,065
Bulk products (3)	49,864		18,481		—		68,345
Other	3,199		1,497		244		4,940
Total external customer sales	$	275,224	$	159,895	$	105,079	$	540,198

(1)For our Industrial and Water Treatment segments, this line includes our non-bulk specialty products that we either manufacture, blend, repackage, resell in their original form, or direct ship to our customers in smaller quantities, and services we provide for our customers. For our Health and Nutrition segment, this line includes products manufactured, processed or repackaged in our facility and/or with our equipment

(2)This line includes non-manufactured distributed specialty products in our Health and Nutrition segment, which may be sold out of one of our facilities or direct shipped to our customers

(3)This line includes bulk products in our Industrial and Water Treatment segments that we do not modify in any way, but receive, store, and ship from our facilities, or direct ship to our customers in large quantities.

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Derivative Instruments

12 Months Ended

Apr. 03, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivative Instruments

We have in place an interest rate swap agreement to manage the risk associated with a portion of our variable-rate long-term debt. We do not utilize derivative instruments for speculative purposes. The interest rate swap involves the exchange of fixed-rate and variable-rate payments without the exchange of the underlying notional amount on which the interest payments are calculated. The notional amount of the swap agreement is $60 million and it will terminate on May 1, 2027. We have designated this swap as a cash flow hedge and have determined that it qualified for hedge accounting treatment. For so long as the hedge is effective, changes in fair value of the cash flow hedge are recorded in other comprehensive income or loss (net of tax) until income or loss from the cash flows of the hedged item is realized.

We previously had in place an interest rate swap agreement to manage the risk associated with a portion of our variable-rate long-term debt. The $20 million swap agreement terminated on December 23, 2020. We had designated this swap as a cash flow hedge and determined that it qualified for hedge accounting treatment. For so long as the hedge was effective, changes in fair value of the cash flow hedge were recorded in other comprehensive income or loss (net of tax) until income or loss from the cash flows of the hedged item was realized.

For the years ended April 3, 2022 and March 28, 2021, we recorded $1.3 million and $0.1 million in other comprehensive income related to unrealized gains (net of tax) on the cash flow hedge. For the year ended March 29, 2020, we recorded $0.4 million in other comprehensive income related to unrealized losses (net of tax) on the cash flow hedge described above. Included in other other long-term assets on our consolidated balance sheet was $1.8 million as of April 3, 2022. Included in other current liabilities on our consolidated balance sheet was $0.1 million as of March 29, 2020.

By their nature, derivative instruments are subject to market risk. Derivative instruments are also subject to credit risk associated with counterparties to the derivative contracts. Credit risk associated with derivatives is measured based on the replacement cost should the counterparty with a contract in a gain position to us fail to perform under the terms of the contract. While the current interest rate swap is in effect, we do not anticipate nonperformance by the counterparty.

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Fair Value Measurements

12 Months Ended

Apr. 03, 2022

Fair Value Disclosures [Abstract]

Fair Value, Measurement Inputs, Disclosure [Text Block]

Fair Value Measurements

Our financial assets and liabilities are measured at fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The carrying value of cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value because of the short-term nature of these instruments. Because of the variable-rate nature of our debt under our credit facility, our debt also approximates fair value.  

Assets and Liabilities Measured at Fair Value on a Recurring Basis.  The fair value hierarchy requires the use of observable market data when available. In instances where inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

Our financial assets that are measured at fair value on a recurring basis are an interest rate swap and assets held in a deferred compensation retirement plan. Both of these assets are classified as other long-term assets on our balance sheet, with the portion of the deferred compensation retirement plan assets expected to be paid within twelve months classified as current assets. The fair value of the interest rate swap is determined by the respective counterparties based on interest rate changes. Interest rate swaps are valued based on observable interest rate yield curves for similar instruments. The deferred compensation plan assets relate to contributions made to a non-qualified compensation plan on behalf of certain employees who are classified as “highly compensated employees” as determined by IRS guidelines. The assets are part of a rabbi trust and the funds are held in mutual funds. The fair value of the deferred compensation is based on the quoted market prices for the mutual funds at the end of the period.

The following table summarizes the balances of assets measured at fair value on a recurring basis as of April 3, 2022 and March 28, 2021.

(In thousands)		April 3, 2022		March 28, 2021
Assets
Deferred compensation plan assets	Level 1	$	7,038	$	5,946
Interest rate swap	Level 2	1,769		—

 0

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Assets Held for Sale	12 Months Ended
	Apr. 03, 2022
Assets Held For Sale [Abstract]
Disclosure of Long Lived Assets Held-for-sale [Table Text Block]	Assets Held for Sale We have no assets classified as held for sale as of April 3, 2022. Included in assets held for sale as of March 28, 2021 was $0.7 million for an office building in St. Louis, Missouri that was utilized in the administration of our Industrial segment, and $0.2 million for a water treatment branch located in Eldridge, Iowa, which has been relocated to another owned facility. Both were sold in the first quarter of fiscal 2022. These amounts were recorded as assets held for sale within prepaid expenses and other current assets on our balance sheet.

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Inventories

12 Months Ended

Apr. 03, 2022

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories at April 3, 2022 and March 28, 2021 consisted of the following:

	2022		2021
(In thousands)
Inventory (FIFO basis)	$	116,325	$	69,438
LIFO reserve	(21,340)		(5,574)
Net inventory	$	94,985	$	63,864

The FIFO value of inventories accounted for under the LIFO method was $83.7 million at April 3, 2022 and $46.8 million at March 28, 2021. The remainder of the inventory was valued and accounted for under the FIFO method.

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Goodwill and Intangible Assets

12 Months Ended

Apr. 03, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Other Identifiable Intangible Assets

The carrying amount of goodwill for each of our three reportable segments were as follows:

(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Balance as of March 29, 2020	$	6,495	$	7,000	$	44,945	$	58,440
Addition due to acquisitions	—		12,280		—		12,280
Balance as of March 28, 2021	$	6,495	$	19,280	$	44,945	$	70,720
Addition due to acquisitions	—		6,681		—		6,681
Balance as of April 3, 2022	$	6,495	$	25,961	$	44,945	$	77,401

The following is a summary of our identifiable intangible assets as of April 3, 2022 and March 28, 2021:

	2022
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	109,644	$	(32,399)	$	77,245
Trademarks and trade names	6,370		(4,746)		1,624
Other finite-life intangible assets	3,904		(3,807)		97
Total finite-life intangible assets	119,918		(40,952)		78,966
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	121,145	$	(40,952)	$	80,193

	2021
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	99,588	$	(26,522)	$	73,066
Trademarks and trade names	6,210		(4,275)		1,935
Other finite-life intangible assets	3,833		(3,693)		140
Total finite-life intangible assets	109,631		(34,490)		75,141
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	110,858	$	(34,490)	$	76,368

Intangible asset amortization expense was $6.5 million during fiscal 2022, $5.8 million during fiscal 2021, and $5.1 million during fiscal 2020.

The estimated future amortization expense for identifiable intangible assets is as follows:

(In thousands)	Intangible Assets
Fiscal 2023	$	6,923
Fiscal 2024	6,707
Fiscal 2025	6,707
Fiscal 2026	6,606
Fiscal 2027	6,305
Thereafter	45,718
Total	$	78,966

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Debt

12 Months Ended

Apr. 03, 2022

Debt Disclosure [Abstract]

Debt

Debt

On March 31, 2022, we entered into a second amended and restated credit agreement (the “Credit Agreement”) with U.S. Bank National Association (“U.S. Bank”) as Sole Lead Arranger and Sole Book Runner, and other lenders from time to time party thereto (collectively, the “Lenders”), whereby U.S. Bank is also serving as Administrative Agent. The Credit Agreement refinanced the revolving loan under our previous credit agreement with U.S. Bank and provides us with senior secured revolving credit facilities (the “Revolving Loan Facility”) totaling $250.0 million. The Revolving Loan Facility includes a $15 million letter of credit subfacility and $25 million swingline subfacility. The Revolving Loan Facility has a five-year maturity date, maturing on April 30, 2027. The Revolving Loan Facility is secured by substantially all of our personal property assets and those of our subsidiaries.

We used $126.0 million of the proceeds from the Revolving Loan Facility to refinance the obligations under the previous credit facility. We may use the remaining amount of the Revolving Loan Facility for working capital, capital expenditures, share repurchases, restricted payments and acquisitions permitted under the Credit Agreement, and other general corporate purposes.

At April 3, 2022, the effective interest rate on our borrowings was 1.2%. In addition to paying interest on the outstanding principal under the Revolving Loan Facility, we are required to pay a commitment fee on the unutilized commitments thereunder. The commitment fee is between 0.15% and 0.25%, depending on our leverage ratio.

Debt issuance costs of $0.3 million paid to the lenders in connection with the Credit Agreement, as well as unamortized debt issuance costs of $0.1 million paid in connection with the previous credit facility, are reflected as a reduction of debt and are being amortized as interest expense over the term of the Revolving Loan Facility.

The Credit Agreement requires us to maintain (a) a minimum fixed charge coverage ratio of 1.15 to 1.00 and (b) a maximum total cash flow leverage ratio of 3.0 to 1.0. The Credit Agreement also contains other customary affirmative and negative covenants, including covenants that restrict our ability to incur additional indebtedness, dispose of significant assets, make certain investments, including any acquisitions other than permitted acquisitions, make certain payments, enter into sale and leaseback transactions, grant liens on our assets or enter into rate management transactions, subject to certain limitations. We are permitted to make distributions, pay dividends and repurchase shares so long as no default or event of default exists or would exist as a result thereof. We are permitted to make distributions, pay dividends and repurchase shares so long as no default or event of default exists or would exist as a result thereof. As of April 3, 2022, we were in compliance with all required covenants.

Debt at April 3, 2022 and March 28, 2021 consisted of the following:

(In thousands)	April 3, 2022		March 28, 2021
Senior secured revolving loan	$	126,000	$	99,000
Less: unamortized debt issuance costs	(443)		(248)
Total debt, net of debt issuance costs	125,557		98,752
Less: current portion of long-term debt, net of current unamortized debt issuance costs	(9,913)		(9,907)
Total long-term debt	$	115,644	$	88,845

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Share Based Compensation

12 Months Ended

Apr. 03, 2022

Share-based Payment Arrangement [Abstract]

Share-Based Compensation

Share-Based Compensation 

Performance-Based Restricted Stock Units.  Our Board of Directors has approved a performance-based equity compensation arrangement for our executive officers. This performance-based arrangement provides for the grant of performance-based restricted stock units that represent a possible future issuance of restricted shares of our common shares based on our pre-tax income target for the applicable fiscal year. The actual number of restricted shares to be issued to each executive officer will be determined when our final financial information becomes available after the applicable fiscal year and will be between zero shares and 88,524 shares in the aggregate for fiscal 2022. The restricted shares issued, if any, will fully vest two years after the end of the fiscal year on which the performance is based. We record the compensation expense for the outstanding performance share units and then-converted restricted stock over the life of the awards.

The following table represents the restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	65,766	$	21.83
Granted	138,504	17.25
Vested	(55,240)	23.01
Forfeited	—	—
Outstanding at end of fiscal 2020	149,030	$	17.13
Granted	129,626	18.69
Vested	(10,526)	15.68
Forfeited	(29,010)	17.92
Outstanding at end of fiscal 2021	239,120	$	17.94
Granted	111,618	31.74
Vested	(123,002)	17.25
Forfeited	(13,258)	18.69
Outstanding at end of fiscal 2022	214,478	$	25.48

The weighted average grant date fair value of performance-based restricted shares issued in fiscal 2022 was $31.74, fiscal 2021 was $18.69 and fiscal 2020 was $17.25. We recorded compensation expense on performance-based restricted stock of approximately $2.9 million for fiscal 2022, $2.5 million for fiscal 2021 and $1.5 million for fiscal 2020, substantially all of which was recorded in selling, general and administrative (“SG&A”) expense in the Consolidated Statements of Income. The total fair value of performance-based restricted stock units vested was $2.1 million in fiscal 2022, $0.2 million in fiscal 2021 and $1.3 million in fiscal 2020.

Until the performance-based restricted stock units result in the issuance of restricted stock, the amount of expense recorded each period is dependent upon our estimate of the number of shares that will ultimately be issued and our then current common share price. Upon issuance of restricted stock, we record compensation expense over the remaining vesting period using the award date closing price. Unrecognized compensation expense related to non-vested restricted stock and non-vested restricted share units as of April 3, 2022 was $3.9 million and is expected to be recognized over a weighted average period of 1.2 years.

Restricted Stock Awards.  As part of their retainer, our non-employee directors receive restricted stock for their Board services. The restricted stock awards are expensed over a one-year vesting period, based on the market value on the date of grant.

The following table represents the Board’s restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	16,704	$	17.95
Granted	16,016	21.84
Vested	(16,704)	17.95
Forfeited	—	—
Outstanding at end of fiscal 2020	16,016	$	21.84
Granted	13,186	25.59
Vested	(16,016)	21.84
Forfeited	(1,958)	25.53
Outstanding at end of fiscal 2021	11,228	$	25.60
Granted	10,287	32.80
Vested	(11,228)	25.60
Forfeited	—	—
Outstanding at end of fiscal 2022	10,287	$	32.80

Annual expense related to the value of restricted stock was $0.3 million in fiscal 2022, 2021 and 2020, and was recorded in SG&A expense in the Consolidated Statements of Income. Unrecognized compensation expense related to non-vested restricted stock awards as of April 3, 2022 was $0.1 million and is expected to be recognized over a weighted average period of 0.3 years.

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Share Repurchase Program	12 Months Ended
	Apr. 03, 2022
Share Repurchase Program [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	Share Repurchases Our board of directors has authorized the repurchase of up to 1,600,000 shares of our outstanding common shares. The shares may be repurchased on the open market or in privately negotiated transactions subject to applicable securities laws and regulations. Upon repurchase of the shares, we reduce our common shares for the par value of the shares with the excess applied against additional paid-in capital. We repurchased 240,501 common shares at an aggregate purchase price of $8.5 million during fiscal 2022. We repurchased 166,088 common shares at an aggregate purchase price of $4.1 million during fiscal 2021. We repurchased 291,166 common shares at an aggregate purchase price of $5.9 million during fiscal 2020. As of April 3, 2022, the number of shares available to be purchased under the share repurchase program was 311,005.

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Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans

12 Months Ended

Apr. 03, 2022

Retirement Benefits [Abstract]

Profit Sharing, Employee Stock Ownership Plan, Employee Stock Purchase Plan and Defined Contribution Pension Plan Contribution Expense

Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans

Company Sponsored Plans. The majority of our non-bargaining unit employees are eligible to participate in a company-sponsored profit sharing plan. Contributions are made at our discretion subject to a maximum amount allowed under the Internal Revenue Code (“IRC”). The profit sharing plan contribution level for each employee depends upon date of hire, and was 2.5% or 5.0% of each employee’s eligible compensation for fiscal 2022, 2021 and 2020. We also have in place a retirement plan covering our collective bargaining unit employees. The retirement plan provides for a contribution of 2.5% or 5.0% of each employee’s eligible annual wages depending on their hire date. In addition to the employer contributions described above, both the profit sharing plan and the retirement plan include a 401(k) plan that allows employees to contribute pre-tax earnings up to the maximum amount allowed under the IRC, with an employer match of up to 5% of the employee’s eligible compensation.

We have two employee stock ownership plans (“ESOPs”), one covering the majority of our non-bargaining unit employees and the other covering our collective bargaining unit employees. Contributions to the plan covering our non-bargaining unit employees are made at our discretion. Contributions to both plans are subject to a maximum amount allowed under the IRC, and were 2.5% or 5.0% of each employee’s eligible wages, depending on each eligible employee’s hire date, for fiscal 2022, 2021 and 2020.

We have a nonqualified deferred compensation plan covering employees who are classified as “highly compensated employees” as determined by IRS guidelines for the plan year and who were hired on or before April 1, 2012. Employees who are eligible for the nonqualified deferred compensation plan for any plan year are not eligible for the profit sharing plan contribution or the ESOP contributions described above for that plan year. Our contribution to the nonqualified deferred compensation plan for fiscal 2022, 2021 and 2020 was 10% of each employee’s eligible compensation, subject to the maximum amount allowed under the IRC.

We have an employee stock purchase plan (“ESPP”) covering substantially all of our employees. The ESPP allows employees to purchase newly-issued shares of the Company’s common shares at a discount from market. The number of new shares issued under the ESPP was 71,692 in fiscal 2022, 88,148 in fiscal 2021 and 77,100 in fiscal 2020.

The following represents the contribution expense for these company-sponsored plans for fiscal 2022, 2021 and 2020:

(In thousands)	2022		2021		2020
Non-bargaining unit employee plans:
Profit sharing	$	1,056	$	994	$	631
401(k) matching contributions	3,122		2,650		2,399
ESOP	1,056		994		631
Nonqualified deferred compensation plan	1,355		1,327		1,262
Bargaining unit employee plans	589		555		481
ESPP - all employees	549		556		431
Total contribution expense	$	7,727	$	7,076	$	5,835

In 2013, we withdrew from a collectively bargained multiemployer pension plan and recorded a liability for our share of the unfunded vested benefits. Payments of approximately $0.5 million per year are being made through 2034.

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Commitments and Contingencies

12 Months Ended

Apr. 03, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Litigation.  As of April 3, 2022, there were no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which we or any of our subsidiaries are a party or of which any of our property is the subject. Legal fees associated with such matters are expensed as incurred.

Asset Retirement Obligations. We have three leases of land which contain terms that state that at the end of the lease term, we have a specified amount of time to remove the property and buildings. Including available lease extensions, these leases expire in 2023, 2033 and 2044. At that time, anything that remains on the land becomes the property of the lessor, and the lessor has the option to either maintain the property or remove the property at our expense. We have not been able to reasonably estimate the fair value of the asset retirement obligations, primarily due to the combination of the following factors: certain of the leases do not expire in the near future; we have a history of extending the leases with the lessors and currently intend to do so at expiration of the lease periods; the lessors do not have a history of terminating leases with their tenants; and because it is more likely than not that the buildings will have value at the end of the lease life and therefore, may not be removed by either the lessee or the lessor. Therefore, in accordance with accounting guidance related to asset retirement and environmental obligations, we have not recorded an asset retirement obligation as of April 3, 2022. We will continue to monitor the factors surrounding the requirement to record an asset retirement obligation and will recognize the fair value of a liability in the period in which it is incurred and a reasonable estimate can be made.

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Income Taxes

12 Months Ended

Apr. 03, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The provisions for income taxes for fiscal 2022, 2021 and 2020 were as follows:

	2022		2021		2020
(In thousands)
Federal — current	$	14,736	$	11,169	$	8,447
State — current	5,202		4,391		3,563
Total current	19,938		15,560		12,010
Federal — deferred	(1,054)		(302)		(976)
State — deferred	(447)		(387)		(445)
Total deferred	(1,501)		(689)		(1,421)
Total provision	$	18,437	$	14,871	$	10,589

Reconciliations of the provisions for income taxes to the applicable federal statutory income tax rate for fiscal 2022, 2021 and 2020 are listed below.

	2022		2021		2020
Statutory federal income tax	21.0	%	21.0	%	21.0	%
State income taxes, net of federal deduction	5.6	%	5.9	%	5.7	%
ESOP dividend deduction on allocated shares	(0.2)	%	(0.2)	%	(0.3)	%
Other — net	(0.1)	%	(0.1)	%	0.8	%
Total	26.3	%	26.6	%	27.2	%

The tax effects of items comprising our net deferred tax liability as of April 3, 2022 and March 28, 2021 are as follows:

(In thousands)	2022		2021
Deferred tax assets:
Trade receivables	$	99	$	134
Stock compensation accruals	1,823		1,341
Pension withdrawal liability	1,250		1,344
Lease liability	2,916		3,191
Other	3,097		2,882
Total deferred tax assets	$	9,185	$	8,892
Deferred tax liabilities:
Inventories	$	(1,288)	$	(2,815)
Prepaid expenses	(937)		(864)
Excess of tax over book depreciation	(12,234)		(11,249)
Intangible assets	(14,806)		(15,269)
ROU asset	(2,864)		(3,140)
Unrealized gain on interest rate swap	(478)		—
Total deferred tax liabilities	$	(32,607)	$	(33,337)
Net deferred tax liabilities	$	(23,422)	$	(24,445)

As of April 3, 2022, the Company has determined that it is more likely than not that the deferred tax assets at April 3, 2022 will be realized either through future taxable income or reversals of taxable temporary differences.

We are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. The tax years prior to our fiscal year ended March 31, 2019 are closed to examination by the Internal Revenue Service, and with few exceptions, state and local income tax jurisdictions.

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Leases

12 Months Ended

Apr. 03, 2022

Leases [Abstract]

Lessee, Operating Leases

Leases

Lease Obligations. As of April 3, 2022, we were obligated under operating lease agreements for certain manufacturing facilities, warehouse space, the land on which some of our facilities sit, vehicles and information technology equipment. Our leases have remaining lease terms of 1 year to 23 years, some of which include options to extend the lease for up to 15 years.

As of April 3, 2022 and March 28, 2021, our operating lease components with initial or remaining terms in excess of one year were classified on the consolidated balance sheet within right-of-use assets, short-term lease liability and long-term lease liability.

Total lease expense was $2.9 million for the twelve months ended April 3, 2022 and $2.8 million for the twelve months ended March 28, 2021, and includes leases less than 12 months in duration.

Other information related to our operating leases was as follows:

	April 3, 2022		March 28, 2021
Lease Term and Discount Rate
Weighted average remaining lease term (years)	8.91		9.73
Weighted average discount rate	2.6	%	2.7	%

Maturities of lease liabilities as of April 3, 2022 were as follows:

(In thousands)	Operating Leases
Fiscal 2023	$	1,889
Fiscal 2024	1,515
Fiscal 2025	1,450
Fiscal 2026	1,388
Fiscal 2027	1,359
Thereafter	5,171
Total	$	12,772
Less: Interest	(1,972)
Present value of lease liabilities	$	10,800

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Segment Information

12 Months Ended

Apr. 03, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information

We have three reportable segments: Industrial, Water Treatment and Health and Nutrition. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Product costs and expenses for each segment are based on actual costs incurred along with cost allocations of shared and centralized functions.

We evaluate performance based on operating income. Reportable segments are defined primarily by product and type of customer. Segments are responsible for the sales, marketing and development of their products and services. Other than our Health and Nutrition segment, the segments do not have separate customer service or purchasing functions. There are no intersegment sales and no operating segments have been aggregated.

Reportable Segments	Industrial		Water Treatment		Health and Nutrition		Total
(In thousands)
Fiscal Year Ended April 3, 2022:
Sales	$	386,938	$	228,133	$	159,470	$	774,541
Gross profit	59,606		54,571		32,343		146,520
Selling, general, and administrative expenses	28,127		31,357		15,842		75,326
Operating income	31,479		23,214		16,501		71,194
Identifiable assets*	$	236,934	$	143,889	$	167,034	$	547,857
Capital expenditures	$	18,812	$	8,939	$	761	$	28,512
Fiscal Year Ended March 28, 2021:
Sales	$	273,361	$	170,004	$	153,506	$	596,871
Gross profit	43,337		46,793		33,632		123,762
Selling, general, and administrative expenses	27,033		24,453		16,398		67,884
Operating income	16,304		22,340		17,234		55,878
Identifiable assets*	$	181,478	$	109,761	$	166,558	$	457,797
Capital expenditures	$	13,713	$	6,732	$	349	$	20,794
Fiscal Year Ended March 29, 2020:
Sales	$	275,224	$	159,895	$	105,079	$	540,198
Gross profit	38,936		41,902		20,079		100,917
Selling, general, and administrative expenses	24,123		19,801		15,322		59,246
Operating income	14,813		22,101		4,757		41,671
Identifiable assets*	$	173,068	$	63,506	$	139,780	$	376,354
Capital expenditures	$	14,933	$	9,160	$	456	$	24,549

* Unallocated assets not included, consisting primarily of cash and cash equivalents, investments and prepaid expenses, were $19.5 million at April 3, 2022, $14.8 million at March 28, 2021 and $13.0 million at March 29, 2020.

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Valuation and Qualifying Accounts

12 Months Ended

Apr. 03, 2022

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]

VALUATION AND QUALIFYING ACCOUNTS

FOR THE FISCAL YEARS ENDED April 3, 2022, March 28, 2021 AND March 29, 2020

 

			Additions
Description	Balance at Beginning of Year		Charged to Costs and Expenses		Charged to Other Accounts		Deductions Write-Offs		Balance at End of  Year
	(In thousands)
Reserve deducted from asset to which it applies:
Fiscal Year Ended April 3, 2022:
Allowance for credit losses	$	497	$	—	$	—	$	(130)	$	367
Fiscal Year Ended March 28, 2021:
Allowance for credit losses	$	784	$	—	$	—	$	(287)	$	497
Fiscal Year Ended March 29, 2020:
Allowance for credit losses	$	620	$	448	$	—	$	(284)	$	784

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Nature of Business and Significant Accounting Policies (Policies)

12 Months Ended

Apr. 03, 2022

Accounting Policies [Abstract]

Fiscal Year

Our fiscal year is a 52 or 53-week year ending on the Sunday closest to March 31. Our fiscal 2022 was 53 weeks and our fiscal 2021 fiscal 2020 were both 52 weeks. Fiscal 2023 will be 52 weeks.

Principles of Consolidation

The consolidated financial statements include the accounts of Hawkins, Inc. and its wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated.

Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, particularly receivables, inventories, property, plant and equipment, right-of-use assets, goodwill, intangibles, accrued expenses, short-term and long-term lease liability, income taxes and related accounts and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products. Revenue is recognized when we satisfy our performance obligations under the contract. We recognize revenue upon transfer of control of the promised products to the customer, with revenue recognized at the point in time the customer obtains control of the products. Net sales include products and shipping charges, net of estimates for product returns and any related sales rebates. We estimate product returns based on historical return rates. Using probability assessments, we estimate sales rebates expected to be paid over the term of the contract. The majority of our contracts have a single performance obligation and are short term in nature. Sales taxes that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. We offer certain customers cash discounts and volume rebates as sales incentives. The discounts and volume rebates are recorded as a reduction in sales at the time revenue is recognized in an amount estimated based on historical experience and contractual obligations. Shipping and Handling - All shipping and handling amounts billed to customers are included in revenues. Costs incurred related to the shipping and the handling of products are included in cost of sales.

Fair Value Measurements

The financial assets and liabilities that are re-measured and reported at fair value for each reporting period are an interest rate swap and marketable securities. There are no fair value measurements with respect to nonfinancial assets or liabilities that are recognized or disclosed at fair value in our consolidated financial statements on a recurring basis.

Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date:

Level 1:  Valuation is based on quoted prices in active markets for identical assets or liabilities.

Level 2:  Valuation is based on quoted prices in active markets for similar assets or liabilities, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable or can be corroborated by observable market data for the asset or liability.

Level 3:  Valuation is based upon unobservable inputs for the asset or liability that are supported by little or no market activity. These fair values are determined using pricing models for which the assumptions utilize management’s estimates or market participant assumptions.

In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

Cash Equivalents

Cash equivalents include all liquid debt instruments (primarily cash funds and money market accounts) purchased with an original maturity of three months or less. The cash balances, maintained at large commercial banking institutions with strong credit ratings, may, at times, exceed federally insured limits.

Trade Receivables

Financial instruments, which potentially subject us to a concentration of credit risk, principally consist of trade receivables. We sell our principal products to a large number of customers in many different industries. As of April 3, 2022, we had a significant concentration of credit risk, with a single customer representing approximately 13% of our total trade receivables. There are no other concentrations of credit risk with other single customers from a particular service or geographic area that would significantly impact us in the near term. To reduce credit risk, we routinely assess the financial strength of our customers. Receivables are reported net of an allowance for credit losses as determined by management at the end of each reporting period. Our receivable allowance in based on an estimate of expected credit losses, with the estimate based on a number of qualitative and quantitative factors that, based on collection experience, may have an impact on repayment risk and ability to collect.

Inventories

Inventories, consisting primarily of finished goods, are primarily valued at the lower of cost or net realizable value, with cost for approximately 73% of our inventory determined using the last-in, first-out (“LIFO”) method. Cost for the other 27% of our total inventory is determined using the first-in, first-out (“FIFO”) method.

Leases

We determine if an arrangement is a lease at inception. Right-of-use ("ROU") assets include operating leases. Lease liabilities for operating leases are classified in "short-term lease liabilities" and "long-term lease liabilities" in our consolidated balance sheet.

ROU assets and related liabilities are recognized at commencement date based on the present value of the lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Lease and non-lease components are generally accounted for separately for real estate leases. For non-real estate leases, we account for the lease and non-lease components as a single lease component.

Property, Plant and Equipment

Property is stated at cost and depreciated or amortized over the lives of the assets, using the straight-line method. Estimated lives are: 10 to 40 years for buildings and improvements; 3 to 20 years for machinery and equipment; and 3 to 10 years for transportation equipment and office furniture and equipment including computer systems. Leasehold improvements are amortized over the lesser of their estimated useful lives or the remaining lease term. Depreciation and amortization expense is recorded in our Consolidated Statement of Income within cost of goods sold and selling, general and administrative expense, depending on the use of the underlying asset. We recorded depreciation expense of $17.7 million for fiscal 2022, $16.8 million for fiscal 2021 and $16.5 million for fiscal 2020.

Significant improvements that add to productive capacity or extend the lives of properties are capitalized. Costs for repairs and maintenance are charged to expense as incurred. When property is retired or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts and any related gains or losses are included in income.

We review the recoverability of long-lived assets to be held and used, such as property, plant and equipment, when events or changes in circumstances occur that indicate the carrying value of the asset group may not be recoverable, such as prolonged industry downturn or significant reductions in projected future cash flows. The assessment of possible impairment is based on our ability to recover the carrying value of the asset group from the expected future pre-tax cash flows (undiscounted) of the related asset group. If these cash flows are less than the carrying value of such asset group, an impairment loss would be measured by the amount the carrying value exceeds the fair value of the long-lived asset group. The measurement of impairment requires us to estimate future cash flows and the fair value of long-lived assets. We did not incur any asset write-off charge in fiscal 2022 related to the impairment of long-lived assets. Asset write-off charges were $0.2 million during fiscal 2021 and $0.6 million during fiscal 2020.

Goodwill and Identifiable Intangible Assets

Goodwill represents the excess of the cost of acquired businesses over the fair value of identifiable tangible net assets and identifiable intangible assets purchased. Goodwill is tested at least annually for impairment, and is tested for impairment more frequently if events or changes in circumstances indicate that the asset might be impaired. Our annual test for impairment is as of the first day of our fourth fiscal quarter. As of December 27, 2021, we performed an analysis of qualitative factors for our Industrial, Water Treatment and Health and Nutrition reporting units to determine whether it is more likely than not that the fair value of either of these reporting units was less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform a quantitative goodwill impairment test for any of these reporting units. Goodwill impairment assessments were also completed in the fourth quarters of fiscal 2021 and 2020 and similarly, we did not record a goodwill impairment charge. Our primary identifiable intangible assets include customer lists, trade secrets, non-competition agreements, trademarks and trade names acquired in previous business acquisitions. Identifiable intangible assets with finite lives are amortized whereas identifiable intangible assets with indefinite lives are not amortized. The values assigned to the intangible assets with finite lives are being amortized on average over a remaining useful life of approximately 12 years. Identifiable intangible assets that are subject to amortization are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. No such events or changes in circumstances occurred during fiscal 2022, 2021 or 2020. Identifiable intangible assets not subject to amortization are tested for impairment annually or more frequently if events warrant. The impairment test consists of a qualitative assessment to determine whether it is more likely than not that the asset is impaired. Based on management’s analysis of qualitative factors, we determined that it was not necessary to perform an annual quantitative impairment test for fiscal 2022, 2021 or 2020.

Income Taxes

We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income tax expense in the period that includes the enactment date. The deferred tax assets and liabilities are analyzed regularly, and management assesses the likelihood that deferred tax assets will be recovered from future taxable income. We record any interest and penalties related to income taxes as income tax expense in the consolidated statements of income.We recognize the effect of income tax positions only if those positions are more-likely-than-not to be sustained. Recognized income tax positions are measured at the largest amount of tax with a greater than 50 percent likelihood of being realized upon ultimate settlement with the related tax authority. Changes in recognition or measurement are reflected in the period in which the facts and circumstances change.

Stock-Based Compensation

We account for stock-based compensation on a fair value basis. The estimated grant date fair value of each stock-based award is recognized in expense over the requisite service period (generally the vesting period). Non-vested share awards are recorded as expense over the requisite service periods based on the stock price on the date of grant.

Earnings Per Share

Basic earnings per share (“EPS”) are computed by dividing net income by the weighted-average number of common shares outstanding. Diluted EPS are computed by dividing net income by the weighted-average number of common shares outstanding including the incremental shares assumed to be issued as performance units and restricted stock. Basic and diluted EPS were calculated using the following:

	April 03, 2022	March 28, 2021	March 29, 2020
Weighted average common shares outstanding — basic	20,947,234	21,024,344	21,159,978
Dilutive impact of stock performance units and restricted stock	188,024	235,952	148,822
Weighted average common shares outstanding — diluted	21,135,258	21,260,296	21,308,800

There were no shares or stock options excluded from the calculation of weighted average common shares for diluted EPS for fiscal 2022, 2021 or 2020.

Stock Split - In fiscal 2021, we effected a two-for-one stock split of our common stock and adjusted the par value of our common stock to $.01 par value. Our consolidated financial statements, related notes, and other financial data contained in this report have been adjusted to give retroactive effect to the stock split for all periods presented.

Derivatives Instruments and Hedging Activities

We are subject to interest rate risk associated with our variable rate debt. We have in place an interest rate swap agreement which has been designated as a cash flow hedge, the purpose of which is to eliminate the cash flow impact of interest rate changes on a portion of our variable-rate debt. The interest rate swap is measured at fair value on the contract date and is subsequently remeasured to fair value at each reporting date. Changes in the fair value of a derivative that is highly effective, and that is designated and qualifies as a cash flow hedge, are recorded in other comprehensive income, until the consolidated statement of income is affected by the variability in cash flows of the designated hedged item. To the extent that the hedge is ineffective, changes in the fair value are recognized in the Statement of Income.

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Nature of Business and Significant Accounting Policies (Tables)

12 Months Ended

Apr. 03, 2022

Accounting Policies [Abstract]

Schedule of earnings per share, basic and diluted

Basic and diluted EPS were calculated using the following:

	April 03, 2022	March 28, 2021	March 29, 2020
Weighted average common shares outstanding — basic	20,947,234	21,024,344	21,159,978
Dilutive impact of stock performance units and restricted stock	188,024	235,952	148,822
Weighted average common shares outstanding — diluted	21,135,258	21,260,296	21,308,800

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Revenue (Tables)

12 Months Ended

Apr. 03, 2022

Revenue [Abstract]

Disaggregation of Revenue [Table Text Block]

The following table disaggregates external customer net sales by major revenue stream:

	Fiscal Year Ended April 3, 2022:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	318,514	$	205,350	$	34,690	$	558,554
Distributed specialty products (2)	—		—		124,312		124,312
Bulk products (3)	61,443		20,211		—		81,654
Other	6,981		2,572		468		10,021
Total external customer sales	$	386,938	$	228,133	$	159,470	$	774,541
	Fiscal Year Ended March 28, 2021:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	231,427	$	152,694	$	38,270	$	422,391
Distributed specialty products (2)	—		—		115,317		115,317
Bulk products (3)	38,378		16,067		—		54,445
Other	3,556		1,243		(81)		4,718
Total external customer sales	$	273,361	$	170,004	$	153,506	$	596,871
	Fiscal Year Ended March 29, 2020:
(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Manufactured, blended or repackaged products (1)	$	222,161	$	139,917	$	14,770	$	376,848
Distributed specialty products (2)	—		—		90,065		90,065
Bulk products (3)	49,864		18,481		—		68,345
Other	3,199		1,497		244		4,940
Total external customer sales	$	275,224	$	159,895	$	105,079	$	540,198

(1)For our Industrial and Water Treatment segments, this line includes our non-bulk specialty products that we either manufacture, blend, repackage, resell in their original form, or direct ship to our customers in smaller quantities, and services we provide for our customers. For our Health and Nutrition segment, this line includes products manufactured, processed or repackaged in our facility and/or with our equipment

(2)This line includes non-manufactured distributed specialty products in our Health and Nutrition segment, which may be sold out of one of our facilities or direct shipped to our customers

(3)This line includes bulk products in our Industrial and Water Treatment segments that we do not modify in any way, but receive, store, and ship from our facilities, or direct ship to our customers in large quantities.

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Fair Value Measurements (Tables)

12 Months Ended

Apr. 03, 2022

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

The following table summarizes the balances of assets measured at fair value on a recurring basis as of April 3, 2022 and March 28, 2021.

(In thousands)		April 3, 2022		March 28, 2021
Assets
Deferred compensation plan assets	Level 1	$	7,038	$	5,946
Interest rate swap	Level 2	1,769		—

 0

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Inventories (Tables)

12 Months Ended

Apr. 03, 2022

Inventory Disclosure [Abstract]

Summary of Inventories

Inventories at April 3, 2022 and March 28, 2021 consisted of the following:

	2022		2021
(In thousands)
Inventory (FIFO basis)	$	116,325	$	69,438
LIFO reserve	(21,340)		(5,574)
Net inventory	$	94,985	$	63,864

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Apr. 03, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

The carrying amount of goodwill for each of our three reportable segments were as follows:

(In thousands)	Industrial		Water Treatment		Health and Nutrition		Total
Balance as of March 29, 2020	$	6,495	$	7,000	$	44,945	$	58,440
Addition due to acquisitions	—		12,280		—		12,280
Balance as of March 28, 2021	$	6,495	$	19,280	$	44,945	$	70,720
Addition due to acquisitions	—		6,681		—		6,681
Balance as of April 3, 2022	$	6,495	$	25,961	$	44,945	$	77,401

Summary of intangible assets

The following is a summary of our identifiable intangible assets as of April 3, 2022 and March 28, 2021:

	2022
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	109,644	$	(32,399)	$	77,245
Trademarks and trade names	6,370		(4,746)		1,624
Other finite-life intangible assets	3,904		(3,807)		97
Total finite-life intangible assets	119,918		(40,952)		78,966
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	121,145	$	(40,952)	$	80,193

	2021
	Gross Amount		Accumulated Amortization		Net carrying value
(In thousands)
Finite-life intangible assets:
Customer relationships	$	99,588	$	(26,522)	$	73,066
Trademarks and trade names	6,210		(4,275)		1,935
Other finite-life intangible assets	3,833		(3,693)		140
Total finite-life intangible assets	109,631		(34,490)		75,141
Indefinite-life intangible assets	1,227		—		1,227
Total intangible assets, net	$	110,858	$	(34,490)	$	76,368

Schedule of future amortization expense

The estimated future amortization expense for identifiable intangible assets is as follows:

(In thousands)	Intangible Assets
Fiscal 2023	$	6,923
Fiscal 2024	6,707
Fiscal 2025	6,707
Fiscal 2026	6,606
Fiscal 2027	6,305
Thereafter	45,718
Total	$	78,966

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Debt (Tables)

12 Months Ended

Apr. 03, 2022

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

Debt at April 3, 2022 and March 28, 2021 consisted of the following:

(In thousands)	April 3, 2022		March 28, 2021
Senior secured revolving loan	$	126,000	$	99,000
Less: unamortized debt issuance costs	(443)		(248)
Total debt, net of debt issuance costs	125,557		98,752
Less: current portion of long-term debt, net of current unamortized debt issuance costs	(9,913)		(9,907)
Total long-term debt	$	115,644	$	88,845

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Share Based Compensation (Tables)

12 Months Ended

Apr. 03, 2022

Performance-Based Restricted Stock [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of performance-based restricted stock units

The following table represents the restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	65,766	$	21.83
Granted	138,504	17.25
Vested	(55,240)	23.01
Forfeited	—	—
Outstanding at end of fiscal 2020	149,030	$	17.13
Granted	129,626	18.69
Vested	(10,526)	15.68
Forfeited	(29,010)	17.92
Outstanding at end of fiscal 2021	239,120	$	17.94
Granted	111,618	31.74
Vested	(123,002)	17.25
Forfeited	(13,258)	18.69
Outstanding at end of fiscal 2022	214,478	$	25.48

Restricted Stock Awards [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of restricted stock awards

The following table represents the Board’s restricted stock activity for fiscal 2021 and 2022:

	Shares	Weighted- Average Grant Date Fair Value
Outstanding at beginning of fiscal 2020	16,704	$	17.95
Granted	16,016	21.84
Vested	(16,704)	17.95
Forfeited	—	—
Outstanding at end of fiscal 2020	16,016	$	21.84
Granted	13,186	25.59
Vested	(16,016)	21.84
Forfeited	(1,958)	25.53
Outstanding at end of fiscal 2021	11,228	$	25.60
Granted	10,287	32.80
Vested	(11,228)	25.60
Forfeited	—	—
Outstanding at end of fiscal 2022	10,287	$	32.80

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Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans (Tables)

12 Months Ended

Apr. 03, 2022

Retirement Benefits [Abstract]

Schedule of contribution expenses

The following represents the contribution expense for these company-sponsored plans for fiscal 2022, 2021 and 2020:

(In thousands)	2022		2021		2020
Non-bargaining unit employee plans:
Profit sharing	$	1,056	$	994	$	631
401(k) matching contributions	3,122		2,650		2,399
ESOP	1,056		994		631
Nonqualified deferred compensation plan	1,355		1,327		1,262
Bargaining unit employee plans	589		555		481
ESPP - all employees	549		556		431
Total contribution expense	$	7,727	$	7,076	$	5,835

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Income Taxes (Tables)

12 Months Ended

Apr. 03, 2022

Income Tax Disclosure [Abstract]

Schedule of provisions for income taxes

The provisions for income taxes for fiscal 2022, 2021 and 2020 were as follows:

	2022		2021		2020
(In thousands)
Federal — current	$	14,736	$	11,169	$	8,447
State — current	5,202		4,391		3,563
Total current	19,938		15,560		12,010
Federal — deferred	(1,054)		(302)		(976)
State — deferred	(447)		(387)		(445)
Total deferred	(1,501)		(689)		(1,421)
Total provision	$	18,437	$	14,871	$	10,589

Schedule of effective income tax rate reconciliation

Reconciliations of the provisions for income taxes to the applicable federal statutory income tax rate for fiscal 2022, 2021 and 2020 are listed below.

	2022		2021		2020
Statutory federal income tax	21.0	%	21.0	%	21.0	%
State income taxes, net of federal deduction	5.6	%	5.9	%	5.7	%
ESOP dividend deduction on allocated shares	(0.2)	%	(0.2)	%	(0.3)	%
Other — net	(0.1)	%	(0.1)	%	0.8	%
Total	26.3	%	26.6	%	27.2	%

Schedule of deferred tax assets and liabilities

The tax effects of items comprising our net deferred tax liability as of April 3, 2022 and March 28, 2021 are as follows:

(In thousands)	2022		2021
Deferred tax assets:
Trade receivables	$	99	$	134
Stock compensation accruals	1,823		1,341
Pension withdrawal liability	1,250		1,344
Lease liability	2,916		3,191
Other	3,097		2,882
Total deferred tax assets	$	9,185	$	8,892
Deferred tax liabilities:
Inventories	$	(1,288)	$	(2,815)
Prepaid expenses	(937)		(864)
Excess of tax over book depreciation	(12,234)		(11,249)
Intangible assets	(14,806)		(15,269)
ROU asset	(2,864)		(3,140)
Unrealized gain on interest rate swap	(478)		—
Total deferred tax liabilities	$	(32,607)	$	(33,337)
Net deferred tax liabilities	$	(23,422)	$	(24,445)

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Leases (Tables)

12 Months Ended

Apr. 03, 2022

Leases [Abstract]

Other information related to our operating leases

Other information related to our operating leases was as follows:

	April 3, 2022		March 28, 2021
Lease Term and Discount Rate
Weighted average remaining lease term (years)	8.91		9.73
Weighted average discount rate	2.6	%	2.7	%

Lessee, Operating Lease, Liability, Maturity

Maturities of lease liabilities as of April 3, 2022 were as follows:

(In thousands)	Operating Leases
Fiscal 2023	$	1,889
Fiscal 2024	1,515
Fiscal 2025	1,450
Fiscal 2026	1,388
Fiscal 2027	1,359
Thereafter	5,171
Total	$	12,772
Less: Interest	(1,972)
Present value of lease liabilities	$	10,800

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Segment Information (Tables)

12 Months Ended

Apr. 03, 2022

Segment Reporting [Abstract]

Summary of Segment Information

Reportable Segments	Industrial		Water Treatment		Health and Nutrition		Total
(In thousands)
Fiscal Year Ended April 3, 2022:
Sales	$	386,938	$	228,133	$	159,470	$	774,541
Gross profit	59,606		54,571		32,343		146,520
Selling, general, and administrative expenses	28,127		31,357		15,842		75,326
Operating income	31,479		23,214		16,501		71,194
Identifiable assets*	$	236,934	$	143,889	$	167,034	$	547,857
Capital expenditures	$	18,812	$	8,939	$	761	$	28,512
Fiscal Year Ended March 28, 2021:
Sales	$	273,361	$	170,004	$	153,506	$	596,871
Gross profit	43,337		46,793		33,632		123,762
Selling, general, and administrative expenses	27,033		24,453		16,398		67,884
Operating income	16,304		22,340		17,234		55,878
Identifiable assets*	$	181,478	$	109,761	$	166,558	$	457,797
Capital expenditures	$	13,713	$	6,732	$	349	$	20,794
Fiscal Year Ended March 29, 2020:
Sales	$	275,224	$	159,895	$	105,079	$	540,198
Gross profit	38,936		41,902		20,079		100,917
Selling, general, and administrative expenses	24,123		19,801		15,322		59,246
Operating income	14,813		22,101		4,757		41,671
Identifiable assets*	$	173,068	$	63,506	$	139,780	$	376,354
Capital expenditures	$	14,933	$	9,160	$	456	$	24,549

* Unallocated assets not included, consisting primarily of cash and cash equivalents, investments and prepaid expenses, were $19.5 million at April 3, 2022, $14.8 million at March 28, 2021 and $13.0 million at March 29, 2020.

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Nature of Business and Significant Accounting Policies -Textual (Details)	12 Months Ended
	Apr. 03, 2022 Segment
Accounting Policies [Abstract]
Number of reportable segments (segment)	3
Percentage of LIFO Inventory	73.00%
Percentage of FIFO inventory	27.00%

XML

Nature of Business and Significant Accounting Policies -PP&E (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Property, Plant and Equipment [Line Items]
Depreciation	$ 17,700	$ 16,800	$ 16,500
Asset Impairment Charges		$ 200	$ 600
Average [Member]
Property, Plant and Equipment [Line Items]
Finite-lived intangible asset, useful life	12 years
Building and Building Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	10 years
Building and Building Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	40 years
Machinery and Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	3 years
Machinery and Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	20 years
Transportation Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	3 years
Transportation Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	10 years
Office Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	3 years
Office Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, estimated useful lives	10 years

XML

Nature of Business and Significant Accounting Policies -EPS (Details) - shares	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Accounting Policies [Abstract]
Weighted Average Number of Shares Outstanding, Basic	20,947,234	21,024,344	21,159,978
Dilutive impact of stock options, performance units, and restricted stock (shares)	188,024	235,952	148,822
Weighted average common shares outstanding — diluted (shares)	21,135,258	21,260,296	21,308,800
Weighted Average Number Diluted Shares Outstanding Adjustment	0	0	0

XML

Business Combinations and Asset Acquisitions (Details) - USD ($) $ in Thousands				3 Months Ended	12 Months Ended
	Dec. 30, 2021	Oct. 29, 2021	Sep. 20, 2021	Apr. 03, 2022	Mar. 28, 2021
NAPCO Chemical Company, Inc. [Member]
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross	$ 18,500			$ 19,000
Other Payments to Acquire Businesses				$ 500
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	9,400
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment	3,600
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other	1,500
Goodwill, Acquired During Period	$ 4,500
Water and Waste Specialties, Inc.
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross		$ 1,400
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles		500
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment		400
Goodwill, Acquired During Period		$ 500
Southeast Water Systems LLC
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross			$ 1,200
Business Combination, Consideration Transferred, Liabilities Incurred			1,000
Business Combination, Consideration Transferred			2,200
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles			400
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment			100
Goodwill, Acquired During Period			$ 1,700
C&L Aqua Professionals, Inc. and LC Blending, Inc.
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross					$ 16,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles					8,200
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment					3,600
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other					1,100
Goodwill, Acquired During Period					3,100
Property
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross					10,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Buildings					4,600
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Land					3,700
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Equipment					1,400
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Site Improvements					300
American Development Corporation of Tennessee, Inc.
Asset Acquisition [Line Items]
Payments to Acquire Businesses, Gross					25,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles					13,300
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment					1,600
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other					900
Goodwill, Acquired During Period					$ 9,200

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Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Disaggregation of Revenue [Line Items]
Sales	$ 774,541	$ 596,871	$ 540,198
Industrial [Member]
Disaggregation of Revenue [Line Items]
Sales	386,938	273,361	275,224
Water Treatment [Member]
Disaggregation of Revenue [Line Items]
Sales	228,133	170,004	159,895
Health and Nutrition [Member]
Disaggregation of Revenue [Line Items]
Sales	159,470	153,506	105,079
Manufactured, blended or repackaged products [Member]
Disaggregation of Revenue [Line Items]
Sales	558,554	422,391	376,848
Manufactured, blended or repackaged products [Member] | Industrial [Member]
Disaggregation of Revenue [Line Items]
Sales	318,514	231,427	222,161
Manufactured, blended or repackaged products [Member] | Water Treatment [Member]
Disaggregation of Revenue [Line Items]
Sales	205,350	152,694	139,917
Manufactured, blended or repackaged products [Member] | Health and Nutrition [Member]
Disaggregation of Revenue [Line Items]
Sales	34,690	38,270	14,770
Distributed specialty products
Disaggregation of Revenue [Line Items]
Sales	124,312	115,317	90,065
Distributed specialty products | Industrial [Member]
Disaggregation of Revenue [Line Items]
Sales	0	0	0
Distributed specialty products | Water Treatment [Member]
Disaggregation of Revenue [Line Items]
Sales	0	0	0
Distributed specialty products | Health and Nutrition [Member]
Disaggregation of Revenue [Line Items]
Sales	124,312	115,317	90,065
Bulk products [Member]
Disaggregation of Revenue [Line Items]
Sales	81,654	54,445	68,345
Bulk products [Member] | Industrial [Member]
Disaggregation of Revenue [Line Items]
Sales	61,443	38,378	49,864
Bulk products [Member] | Water Treatment [Member]
Disaggregation of Revenue [Line Items]
Sales	20,211	16,067	18,481
Bulk products [Member] | Health and Nutrition [Member]
Disaggregation of Revenue [Line Items]
Sales	0	0	0
Other [Member]
Disaggregation of Revenue [Line Items]
Sales	10,021	4,718	4,940
Other [Member] | Industrial [Member]
Disaggregation of Revenue [Line Items]
Sales	6,981	3,556	3,199
Other [Member] | Water Treatment [Member]
Disaggregation of Revenue [Line Items]
Sales	2,572	1,243	1,497
Other [Member] | Health and Nutrition [Member]
Disaggregation of Revenue [Line Items]
Sales	$ 468	$ (81)	$ 244

XML

Derivative Instruments (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020	Dec. 27, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative, Notional Amount	$ 60,000			$ 20,000
Other comprehensive income, net of tax	1,300	$ 100	$ (400)
Cash Flow Hedge Derivative Instrument Assets at Fair Value	$ 1,800
Cash Flow Hedge Derivative Instrument Liabilities at Fair Value		$ 100

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Fair Value Measurements (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan asset	$ 6,783	$ 5,726
Interest rate swap	1,800
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Deferred compensation plan asset	7,038	5,946
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Interest rate swap	$ 1,769	$ 0

XML

Assets Held for Sale (Details) - USD ($) $ in Millions	Apr. 03, 2022	Mar. 28, 2021
Assets Held For Sale [Abstract]
Assets Held-for-sale, Long Lived, Fair Value Disclosure	$ 0.0
Assets Held-for-sale, Long Lived, Fair Value Disclosure	$ 0.0
Industrial [Member]
Assets Held For Sale [Abstract]
Assets Held-for-sale, Long Lived, Fair Value Disclosure		$ 0.7
Assets Held-for-sale, Long Lived, Fair Value Disclosure		0.7
Water Treatment [Member]
Assets Held For Sale [Abstract]
Assets Held-for-sale, Long Lived, Fair Value Disclosure		0.2
Assets Held-for-sale, Long Lived, Fair Value Disclosure		$ 0.2

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Inventories (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
Summary of Inventories
Inventory (FIFO basis)	$ 116,325	$ 69,438
LIFO reserve	(21,340)	(5,574)
Net inventory	$ 94,985	$ 63,864

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Inventories-Textual (Details) - USD ($) $ in Millions	Apr. 03, 2022	Mar. 28, 2021
Inventories (Textual) [Abstract]
Finished goods (LIFO basis)	$ 83.7	$ 46.8

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Goodwill and Intangible Assets-Goodwill Rollforward (Details) $ in Thousands	12 Months Ended
	Apr. 03, 2022 USD ($) Segment	Mar. 28, 2021 USD ($)	Mar. 29, 2020 USD ($)
Goodwill [Line Items]
Number of Reportable Segments | Segment	3
Goodwill	$ 77,401	$ 70,720	$ 58,440
Goodwill, Period Increase (Decrease)	6,681	12,280
Industrial [Member]
Goodwill [Line Items]
Goodwill	6,495	6,495	6,495
Goodwill, Period Increase (Decrease)	0	0
Water Treatment [Member]
Goodwill [Line Items]
Goodwill	25,961	19,280	7,000
Goodwill, Period Increase (Decrease)	6,681	12,280
Health and Nutrition [Member]
Goodwill [Line Items]
Goodwill	44,945	44,945	$ 44,945
Goodwill, Period Increase (Decrease)	$ 0	$ 0

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Goodwill and Intangible Assets-Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Finite-Lived Intangible Assets [Line Items]
Gross Amount	$ 119,918	$ 109,631
Accumulated Amortization	(40,952)	(34,490)
Net carrying value	78,966	75,141
Indefinite-life intangible assets	1,227	1,227
Intangible Assets, Gross (Excluding Goodwill)	121,145	110,858
Finite-Lived Intangible Assets, Accumulated Amortization	40,952	34,490
Total intangible assets, net	80,193	76,368
Amortization of Intangible Assets	6,500	5,800	$ 5,100
Customer relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	109,644	99,588
Accumulated Amortization	(32,399)	(26,522)
Net carrying value	77,245	73,066
Finite-Lived Intangible Assets, Accumulated Amortization	32,399	26,522
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Amount	6,370	6,210
Accumulated Amortization	(4,746)	(4,275)
Net carrying value	1,624	1,935
Finite-Lived Intangible Assets, Accumulated Amortization	4,746	4,275
Other Intangible Assets
Finite-Lived Intangible Assets [Line Items]
Gross Amount	3,904	3,833
Accumulated Amortization	(3,807)	(3,693)
Net carrying value	97	140
Finite-Lived Intangible Assets, Accumulated Amortization	$ 3,807	$ 3,693

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Goodwill and Intangible Assets-Future Amortization (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
Estimated amortization expense [Abstract]
Fiscal 2023	$ 6,923
Fiscal 2024	6,707
Fiscal 2025	6,707
Fiscal 2026	6,606
Fiscal 2027	6,305
Thereafter	45,718
Total	$ 78,966	$ 75,141

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Debt (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020	Mar. 31, 2022
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 250,000
Revolving Loan Facility Letter of Credit	15,000
Revolving Loan Facility Swingline Subfacility	25,000
Payment for Debt Extinguishment or Debt Prepayment Cost	$ 126,000
Line of Credit Facility, Interest Rate at Period End	1.20%
Payments of Debt Issuance Costs	$ 287	$ 0	$ 0
Unamortized Debt Issuance Expense	$ 443	$ 248		$ 100
Minimum [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.15%
Fixed charge coverage ratio	100.00%
Cash flow leverage ratio	100.00%
Maximum [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.25%
Fixed charge coverage ratio	115.00%
Cash flow leverage ratio	300.00%

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Debt (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 31, 2022	Mar. 28, 2021
Debt Instrument [Line Items]
Unamortized Debt Issuance Expense	$ (443)	$ (100)	$ (248)
Total debt, net of debt issuance costs	125,557		98,752
Less Current Portion of Long-term Debt	(9,913)		(9,907)
Long-term Debt, Excluding Current Maturities	115,644		88,845
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Total long-term Debt	$ 126,000		$ 99,000

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Share Based Compensation-Restricted and Performance Shares Rollforward (Details) - $ / shares	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Performance-Based Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning Balance, Shares	239,120	149,030	65,766
Granted, Shares	111,618	129,626	138,504
Vested, Shares	(123,002)	(10,526)	(55,240)
Forfeited or expired, Shares	(13,258)	(29,010)	0
Ending Balance, Shares	214,478	239,120	149,030
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Beginning Balance, Weighted average grant date fair value (usd per share)	$ 17.94	$ 17.13	$ 21.83
Granted, Weighted average grant date fair value (usd per share)	31.74	18.69	17.25
Vested, Weighted average grant date fair value (usd per share)	17.25	15.68	23.01
Forfeited or expired, Weighted average grant date fair value (usd per share)	18.69	17.92	0
Ending Balance, Weighted average grant date fair value (usd per share)	$ 25.48	$ 17.94	$ 17.13
Restricted Stock Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Beginning Balance, Shares	11,228	16,016	16,704
Granted, Shares	10,287	13,186	16,016
Vested, Shares	(11,228)	(16,016)	(16,704)
Forfeited or expired, Shares	0	(1,958)	0
Ending Balance, Shares	10,287	11,228	16,016
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Beginning Balance, Weighted average grant date fair value (usd per share)	$ 25.60	$ 21.84	$ 17.95
Granted, Weighted average grant date fair value (usd per share)	32.80	25.59	21.84
Vested, Weighted average grant date fair value (usd per share)	25.60	21.84	17.95
Forfeited or expired, Weighted average grant date fair value (usd per share)	0	25.53	0
Ending Balance, Weighted average grant date fair value (usd per share)	$ 32.80	$ 25.60	$ 21.84

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Share Based Compensation-Textual (Details) - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Performance-Based Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of restricted stock to be issued minimum	0
Range of restricted stock to be issued maximum	88,524
Weighted average grant date fair value (usd per share)	$ 31.74	$ 18.69	$ 17.25
Compensation expense	$ 2.9	$ 2.5	$ 1.5
Equity instruments other than options, vested in period, total fair value	2.1	$ 0.2	$ 1.3
Cost not yet recognized	$ 3.9
Performance-Based Restricted Stock [Member] | Weighted Average [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized, period for recognition	1 year 2 months 12 days
Restricted Stock Awards [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant date fair value (usd per share)	$ 32.80	$ 25.59	$ 21.84
Compensation expense	$ 0.3	$ 0.3	$ 0.3
Cost not yet recognized	$ 0.1
Restricted Stock Awards [Member] | Weighted Average [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized, period for recognition	3 months 18 days

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Share Repurchase Program (Details) - USD ($) $ in Millions	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Stock Repurchase Program, Number of Shares Authorized to be Repurchased	1,600,000
Stock Repurchased During Period, Value	$ 8.5	$ 4.1	$ 5.9
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased	311,005
Common Stock [Member]
Stock Repurchased During Period, Shares	240,501	166,088	291,166

XML

Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Defined Contribution Plan Disclosure [Line Items]
Profit sharing	$ 1,056	$ 994	$ 631
401(k) matching contributions	3,122	2,650	2,399
ESOP	1,056	994	631
Nonqualified deferred compensation plan	1,355	1,327	1,262
ESPP - all employees	549	556	431
Total contribution expense	7,727	7,076	5,835
Bargaining Unit Employee Plans [Member]
Defined Contribution Plan Disclosure [Line Items]
Bargaining unit employee plans	$ 589	$ 555	$ 481

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Profit Sharing, Employee Stock Ownership, Employee Stock Purchase and Pension Plans -Textual (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Defined Contribution Plan Disclosure [Line Items]
Multi Employer Pension Plan Withdrawal Liability Payment Over Period of Years	$ 500
Common Stock [Member]
Defined Contribution Plan Disclosure [Line Items]
ESPP shares issued (shares)	71,692	88,148	77,100
Deferred Profit Sharing [Member] | Qualified Plan [Member] | Minimum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	2.50%	2.50%
Deferred Profit Sharing [Member] | Qualified Plan [Member] | Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	5.00%	5.00%
Deferred Profit Sharing [Member] | Nonqualified Plan [Member] | Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	10.00%	10.00%
401 (k) plan [Member] | Qualified Plan [Member] | Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	5.00%
Employee Stock Ownership Plan (ESOP), Plan [Domain] | Qualified Plan [Member] | Minimum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	2.50%	2.50%
Employee Stock Ownership Plan (ESOP), Plan [Domain] | Qualified Plan [Member] | Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	5.00%	5.00%
Bargaining Unit Employee Plans [Member] | Deferred Profit Sharing [Member] | Qualified Plan [Member] | Minimum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	2.50%
Bargaining Unit Employee Plans [Member] | Deferred Profit Sharing [Member] | Qualified Plan [Member] | Maximum [Member]
Defined Contribution Plan Disclosure [Line Items]
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	5.00%

XML

Commitment and Contingencies-Textual (Details)	12 Months Ended
	Apr. 03, 2022 lease
Commitments and Contingencies Disclosure [Abstract]
Number of Leases	3

XML

Income Taxes-Provision of Income Tax (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Income Tax Examination [Line Items]
Federal — current	$ 14,736	$ 11,169	$ 8,447
State — current	5,202	4,391	3,563
Total current	19,938	15,560	12,010
Federal — deferred	(1,054)	(302)	(976)
State — deferred	(447)	(387)	(445)
Total deferred	(1,501)	(689)	(1,421)
Total provision	$ 18,437	$ 14,871	$ 10,589

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Income Taxes-Effective Income Tax Rate Reconciliation (Details)	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Income Tax Disclosure [Abstract]
Statutory federal income tax (percent)	21.00%	21.00%	21.00%
State income taxes, net of federal deduction (percent)	5.60%	5.90%	5.70%
ESOP dividend deduction on allocated shares (percent)	(0.20%)	(0.20%)	(0.30%)
Other — net (percent)	(0.10%)	(0.10%)	0.80%
Total (percent)	26.30%	26.60%	27.20%

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Income Taxes Income Taxes-Deferred Tax Assets (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
Deferred tax assets:
Trade receivables	$ 99	$ 134
Stock compensation accruals	1,823	1,341
Pension withdrawal liability	1,250	1,344
Lease liability	2,916	3,191
Other	3,097	2,882
Total deferred tax assets	9,185	8,892
Deferred tax liabilities:
Inventories	(1,288)	(2,815)
Prepaid expenses	(937)	(864)
Excess of tax over book depreciation	(12,234)	(11,249)
Intangible assets	(14,806)	(15,269)
ROU asset	2,864	3,140
Unrealized gain on interest rate swap	(478)	0
Total deferred tax liabilities	(32,607)	(33,337)
Net deferred tax liabilities	$ (23,422)	$ (24,445)

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Leases (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021
Lessee, Operating Lease, Option to Extend	15 years
Operating Lease, Expense	$ 2,900	$ 2,800
Minimum [Member]
Lessee, Operating Lease, Renewal Term	1 year
Maximum [Member]
Lessee, Operating Lease, Renewal Term	23 years

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Leases (Details) - USD ($) $ in Thousands	Apr. 03, 2022	Mar. 28, 2021
Leases [Abstract]
Weighted average remaining lease term (years)	8 years 10 months 28 days	9 years 8 months 23 days
Weighted average discount rate	2.60%	2.70%
Fiscal 2023	$ 1,889
Fiscal 2024	1,515
Fiscal 2025	1,450
Fiscal 2026	1,388
Fiscal 2027	1,359
Thereafter	5,171
Total	12,772
Less: Interest	1,972
Present value of lease liabilities	$ 10,800

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Segment Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020
Summary of Segment Information
Sales	$ 774,541	$ 596,871	$ 540,198
Gross profit	146,520	123,762	100,917
Selling, general, and administrative expenses	75,326	67,884	59,246
Operating income	71,194	55,878	41,671
Assets	567,328	472,550
Capital expenditures	28,512	20,794	24,549
Industrial [Member]
Summary of Segment Information
Sales	386,938	273,361	275,224
Gross profit	59,606	43,337	38,936
Selling, general, and administrative expenses	28,127	27,033	24,123
Operating income	31,479	16,304	14,813
Assets	236,934	181,478	173,068
Capital expenditures	18,812	13,713	14,933
Water Treatment [Member]
Summary of Segment Information
Sales	228,133	170,004	159,895
Gross profit	54,571	46,793	41,902
Selling, general, and administrative expenses	31,357	24,453	19,801
Operating income	23,214	22,340	22,101
Assets	143,889	109,761	63,506
Capital expenditures	8,939	6,732	9,160
Health and Nutrition [Member]
Summary of Segment Information
Sales	159,470	153,506	105,079
Gross profit	32,343	33,632	20,079
Selling, general, and administrative expenses	15,842	16,398	15,322
Operating income	16,501	17,234	4,757
Assets	167,034	166,558	139,780
Capital expenditures	761	349	456
Identifiable
Summary of Segment Information
Assets	547,857	457,797	376,354
Unallocated
Summary of Segment Information
Assets	$ 19,500	$ 14,800	$ 13,000

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Segment Information-Textual (Details) $ in Millions	12 Months Ended
	Apr. 03, 2022 USD ($) Segment
Segment Reporting Information [Line Items]
Number of reportable segments (segment)	3
Intersegment Sales | $	$ 0
Number of Operating Segments Aggregated	0

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Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Apr. 03, 2022	Mar. 28, 2021	Mar. 29, 2020	Mar. 31, 2019
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]
Allowance for doubtful accounts receivable	$ 367	$ 497	$ 784	$ 620
Valuation Allowances and Reserves, Additions for Adjustments	0	0	448
SEC Schedule, 12-09, Valuation Allowances and Reserves, Additions, Charge to Other Account	0	0	0
Valuation Allowances and Reserves, Deductions	$ (130)	$ (287)	$ (284)