Latham Group Stock Earnings Reports

Latham reported a solid start to FY2026 with Q1 net sales of $117M, up 5% year-over-year (3% organic, 2% from the Freedom Pools acquisition). All product lines grew: In-Ground pools +4% (largely Freedom contribution), covers +6%, liners +9%. Gross margin expanded 220 bps to 32% driven by operating leverage and lean manufacturing/value engineering; adjusted EBITDA rose 9% to $12M and adjusted EBITDA margin expanded to 10.4%. SG&A increased 20% to $37M due to strategic sales/marketing investments, digital initiatives and acquisition-related earn-out expense (Coverstar Central earn-out ~ $9M for 2026). Q1 net loss was $9M; cash was $27M and total debt $311M (net leverage ~2.8x). CapEx was $23M reflecting purchases of four fiberglass manufacturing facilities and other investments; full-year CapEx guidance is $42–48M. Management reaffirmed 2026 guidance for ~9% revenue growth and ~13% adjusted EBITDA growth, highlighted a focused push to accelerate fiberglass adoption in the “sand states” (notably Florida) and integration of Freedom Pools (Australia/New Zealand). They are monitoring higher transportation and commodity cost risks from oil price volatility and Middle East tensions and have implemented temporary fuel surcharges (estimated ~60 bps impact) as a mitigation. Overall, management is confident in seasonal order trends (April pickup), margin initiatives, and their playbook to gain share even if U.S. pool starts remain roughly flat.