[Executive Summary](index=1&type=section&id=Executive%20Summary) This section provides an overview of Leslie's, Inc.'s third quarter fiscal 2025 performance, highlighting key financial results and management's strategic response to challenging market conditions [Third Quarter Fiscal 2025 Performance Highlights](index=1&type=section&id=Third%20Quarter%20Fiscal%202025%20Performance%20Highlights) Leslie's, Inc. reported financial results for the third quarter of fiscal 2025 below expectations, primarily due to challenging weather conditions and competitive pricing dynamics during its peak selling season, experiencing significant declines across key financial metrics compared to the prior year period Third Quarter Fiscal 2025 Performance (Millions) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | Change (%) | | :--------------------------- | :------------------- | :------------------- | :--------- | | Sales | $500.3 | $569.6 | -12.2% | | Comparable Sales | - | - | -12.4% | | Gross Profit | $197.9 | $228.8 | -13.5% | | Gross Margin | 39.6% | 40.2% | -0.6 pp | | Operating Income | $68.3 | $97.7 | -30.1% | | Net Income | $21.7 | $60.7 | -64.2% | | Adjusted Net Income | $37.9 | $63.3 | -40.1% | | Diluted EPS | $0.12 | $0.33 | -63.6% | | Adjusted Diluted EPS | $0.20 | $0.34 | -41.2% | | Adjusted EBITDA | $81.6 | $109.5 | -25.5% | [Management Commentary and Strategic Outlook](index=1&type=section&id=Management%20Commentary%20and%20Strategic%20Outlook) CEO Jason McDonell acknowledged the challenging quarter, citing weather and competitive pricing, with the company actively mitigating costs and bringing in additional resources to accelerate strategic initiatives aimed at improving profitability and driving long-term growth through an ongoing strategic and operational review - Faced significant headwinds from weather and competitive pricing dynamics in a compressed demand period[2](index=2&type=chunk) - Implemented cost mitigation efforts, including reducing labor hours to align with softer demand and reduced store traffic[2](index=2&type=chunk) - Engaged additional resources to accelerate key initiatives, identify, and execute strategic priorities for improved profitability and long-term growth[2](index=2&type=chunk)[3](index=3&type=chunk) [Company Information](index=2&type=section&id=Company%20Information) This section details Leslie's, Inc.'s identity as the leading direct-to-customer brand in the U.S. pool and spa care industry, outlining its market position and operational model [About Leslie's](index=2&type=section&id=About%20Leslie's) Leslie's, Inc., founded in 1963, is the largest direct-to-customer brand in the U.S. pool and spa care industry, serving both residential and professional customers with an extensive and largely exclusive assortment of essential products through an integrated ecosystem of over 1,000 physical locations and a robust digital platform - Largest and most trusted direct-to-customer brand in the U.S. pool and spa care industry[8](index=8&type=chunk) - Serves residential customers and pool professionals nationwide with essential and largely exclusive pool and spa care products[8](index=8&type=chunk) - Operates an integrated ecosystem of over **1,000 physical locations** and a robust digital platform[8](index=8&type=chunk) [Financial Performance - Third Quarter Fiscal 2025](index=1&type=section&id=Financial%20Performance%20-%20Third%20Quarter%20Fiscal%202025) This section presents a detailed analysis of Leslie's, Inc.'s financial results for the third quarter of fiscal 2025, including sales, profitability, and adjusted financial measures [Key Financial Results](index=1&type=section&id=Key%20Financial%20Results) The third quarter of fiscal 2025 saw a significant decline in sales and profitability compared to the prior year, with sales decreasing by **12.2%**, leading to a **13.5%** drop in gross profit and a **30.1%** reduction in operating income, while net income and diluted EPS also fell sharply Key Financial Results (Millions) | Metric | Q3 FY2025 (Millions) | Q3 FY2024 (Millions) | Change (%) | | :--------------------------- | :------------------- | :------------------- | :--------- | | Sales | $500.3 | $569.6 | -12.2% | | Comparable Sales | - | - | -12.4% | | Gross Profit | $197.9 | $228.8 | -13.5% | | Gross Margin | 39.6% | 40.2% | -0.6 pp | | Selling, General & Admin. Expenses | $129.6 | $131.1 | -1.1% | | Operating Income | $68.3 | $97.7 | -30.1% | | Interest Expense | $15.8 | $18.2 | -13.2% | | Net Income | $21.7 | $60.7 | -64.2% | | Diluted EPS | $0.12 | $0.33 | -63.6% | | Adjusted Net Income | $37.9 | $63.3 | -40.1% | | Adjusted Diluted EPS | $0.20 | $0.34 | -41.2% | | Adjusted EBITDA | $81.6 | $109.5 | -25.5% | | Cash & Cash Equivalents (period end) | $42.7 | $74.4 | -42.6% | | Inventories (period end) | $273.2 | $302.2 | -9.6% | [Condensed Consolidated Statements of Operations (Q3)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%28Q3%29) The condensed consolidated statements of operations for the three months ended June 28, 2025, show a decrease in sales to **$500.3 million** from **$569.6 million** in the prior year, leading to a net income of **$21.7 million**, significantly lower than **$60.7 million** in the comparable period of the prior fiscal year Condensed Consolidated Statements of Operations (Thousands) | Metric (Thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | | Sales | $500,347 | $569,638 | | Cost of merchandise and services sold | $302,457 | $340,798 | | Gross profit | $197,890 | $228,840 | | Selling, general and administrative expenses | $129,572 | $131,145 | | Operating income (loss) | $68,318 | $97,695 | | Interest expense | $15,764 | $18,156 | | Net income (loss) before taxes | $52,554 | $79,539 | | Income tax expense (benefit) | $30,824 | $18,889 | | Net income (loss) | $21,730 | $60,650 | | Basic EPS | $0.12 | $0.33 | | Diluted EPS | $0.12 | $0.33 | | Basic Weighted average shares outstanding | 185,490 | 184,834 | | Diluted Weighted average shares outstanding | 185,490 | 184,861 | [Adjusted Financial Measures (Q3)](index=7&type=section&id=Adjusted%20Financial%20Measures%20%28Q3%29) For the third quarter, Adjusted EBITDA decreased by **25.5%** to **$81.6 million**, and Adjusted net income fell by **40.1%** to **$37.9 million**, reflecting the overall decline in profitability when excluding certain non-recurring or non-cash items Adjusted Financial Measures (Thousands) | Metric (Thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | | :--------------------------- | :------------------------------- | :------------------------------- | | Adjusted EBITDA | $81,570 | $109,469 | | Adjusted net income (loss) | $37,937 | $63,297 | | Adjusted diluted earnings per share | $0.20 | $0.34 | [Financial Performance - Nine Months Ended June 28, 2025](index=7&type=section&id=Financial%20Performance%20-%20Nine%20Months%20Ended%20June%2028%2C%202025) This section provides a comprehensive review of Leslie's, Inc.'s financial performance for the nine-month period ending June 28, 2025, covering statements of operations, balance sheets, and cash flows [Condensed Consolidated Statements of Operations (9 Months)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%289%20Months%29) For the nine months ended June 28, 2025, Leslie's reported a net loss of **$74.2 million**, a significant increase from the **$13.5 million** net loss in the prior year period, with sales also decreasing to **$852.7 million** from **$932.3 million** Condensed Consolidated Statements of Operations (Thousands) | Metric (Thousands) | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | | Sales | $852,709 | $932,262 | | Cost of merchandise and services sold | $563,156 | $598,686 | | Gross profit | $289,553 | $333,576 | | Selling, general and administrative expenses | $309,313 | $302,879 | | Operating income (loss) | $(19,760) | $30,697 | | Interest expense | $47,425 | $53,380 | | Net income (loss) before taxes | $(67,185) | $(22,683) | | Income tax expense (benefit) | $6,969 | $(9,227) | | Net income (loss) | $(74,154) | $(13,456) | | Basic EPS | $(0.40) | $(0.07) | | Diluted EPS | $(0.40) | $(0.07) | | Basic Weighted average shares outstanding | 185,256 | 184,614 | | Diluted Weighted average shares outstanding | 185,256 | 184,614 | [Adjusted Financial Measures (9 Months)](index=7&type=section&id=Adjusted%20Financial%20Measures%20%289%20Months%29) For the nine-month period, Adjusted EBITDA significantly decreased to **$16.2 million** from **$65.8 million** in the prior year, and the Adjusted net loss also widened to **$49.9 million** from **$5.5 million**, indicating a substantial deterioration in adjusted profitability Adjusted Financial Measures (Thousands) | Metric (Thousands) | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--------------------------- | :------------------------------ | :------------------------------ | | Adjusted EBITDA | $16,193 | $65,771 | | Adjusted net income (loss) | $(49,877) | $(5,465) | | Adjusted diluted earnings per share | $(0.27) | $(0.03) | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 28, 2025, total assets decreased to **$989.5 million** from **$1,105.2 million** a year prior, with cash and cash equivalents seeing a notable decline, inventories reduced, total liabilities decreased, but stockholders' deficit widened Condensed Consolidated Balance Sheets (Thousands) | Metric (Thousands) | June 28, 2025 | June 29, 2024 | | :--------------------------------- | :------------ | :------------ | | Cash and cash equivalents | $42,684 | $74,438 | | Inventories | $273,192 | $302,209 | | Total current assets | $385,130 | $457,009 | | Total assets | $989,493 | $1,105,188 | | Accounts payable | $91,587 | $108,935 | | Total current liabilities | $261,971 | $285,881 | | Long-term debt, net | $751,547 | $768,598 | | Total liabilities | $1,235,660 | $1,273,345 | | Total stockholders' deficit | $(246,167) | $(168,157) | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended June 28, 2025, the company reported net cash used in operating activities of **$39.4 million**, a significant shift from net cash provided by operating activities of **$60.4 million** in the prior year, with investing activities also using cash, while financing activities saw net cash used of **$7.5 million** Condensed Consolidated Statements of Cash Flows (Thousands) | Activity (Thousands) | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--------------------------------- | :------------------------------ | :------------------------------ | | Net cash (used in) provided by operating activities | $(39,398) | $60,410 | | Net cash used in investing activities | $(18,947) | $(34,247) | | Net cash used in financing activities | $(7,476) | $(7,145) | | Net (decrease) increase in cash and cash equivalents | $(65,821) | $19,018 | | Cash and cash equivalents, end of period | $42,684 | $74,438 | - Repaid approximately **$27 million** on Term Loan during the nine months ended June 28, 2025[5](index=5&type=chunk)[29](index=29&type=chunk) [Fiscal Year 2025 Outlook](index=2&type=section&id=Fiscal%20Year%202025%20Outlook) This section outlines Leslie's, Inc.'s updated financial projections and expectations for the full fiscal year 2025, including sales, net loss, and Adjusted EBITDA guidance [Updated Full Year Fiscal 2025 Expectations](index=2&type=section&id=Updated%20Full%20Year%20Fiscal%202025%20Expectations) Leslie's updated its full-year fiscal 2025 expectations, projecting sales between **$1,210 million** and **$1,235 million**, anticipating a net loss of **$57 million** to **$65 million** and an Adjusted net loss of **$31 million** to **$39 million**, with Adjusted EBITDA expected to be between **$50 million** and **$60 million** Fiscal Year 2025 Guidance | Metric | FY2025 Guidance | | :---------------- | :------------------------------ | | Sales | $1,210 million to $1,235 million | | Net Loss | $57 million to $65 million | | Adjusted net loss | $31 million to $39 million | | Adjusted EBITDA | $50 million to $60 million | - The company believes it has sufficient coverage for liability obligations through cash on hand and additional cash generated from operations in Q4[5](index=5&type=chunk) [Non-GAAP Financial Measures Explanation](index=2&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) This section defines and explains the non-GAAP financial measures used by Leslie's, Inc., such as Adjusted EBITDA and Adjusted Net Income, and provides their reconciliation to GAAP equivalents [Explanation of Non-GAAP Measures](index=2&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Leslie's uses non-GAAP financial measures like comparable sales growth, Adjusted EBITDA, Adjusted net income (loss), and Adjusted diluted earnings per share to evaluate business strategies, make budgeting decisions, and compare performance, noting these measures are supplementary to GAAP results and not intended as substitutes - Non-GAAP measures are used to evaluate business strategies, make budgeting decisions, and compare performance against peers[9](index=9&type=chunk) - These measures should not be considered in isolation or as substitutes for GAAP results and may not be comparable to similarly titled measures of other companies[9](index=9&type=chunk) [Comparable Sales Growth Definition](index=3&type=section&id=Comparable%20Sales%20Growth%20Definition) Comparable sales growth measures the increase or decrease in sales from the comparable base (including locations, e-commerce, and third-party marketplaces) in a reporting period versus the prior period, serving as a key metric for management and the board to assess financial performance - Defined as the increase or decrease in sales recorded by the comparable base (locations, e-commerce, third-party marketplaces) in any reporting period compared to the prior period[10](index=10&type=chunk) - A key measure used by management and the board of directors to assess financial performance[10](index=10&type=chunk) [Adjusted EBITDA Definition](index=3&type=section&id=Adjusted%20EBITDA%20Definition) Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, equity-based compensation, executive transition costs, severance, strategic project costs, M&A costs, and other non-recurring items, serving as a key management and board measure, also used by analysts and investors, to evaluate business strategies and compare performance, but it is not a GAAP measure - Defined as earnings before interest, taxes, depreciation and amortization, equity-based compensation, executive transition costs, severance, strategic project costs, merger and acquisition costs, and other non-recurring, non-cash or discrete items[11](index=11&type=chunk) - Used by management, board, analysts, and investors to assess financial performance and evaluate business strategies[11](index=11&type=chunk) - Not a recognized GAAP measure and should not be construed as an indicator of operating performance in isolation from, or as a substitute for, net income or cash flows from operations[12](index=12&type=chunk) [Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) per Share Definition](index=3&type=section&id=Adjusted%20Net%20Income%20%28Loss%29%20and%20Adjusted%20Diluted%20Earnings%20%28Loss%29%20per%20Share%20Definition) Adjusted net income (loss) excludes equity-based compensation, executive transition costs, severance, strategic project costs, M&A costs, change in valuation allowance for deferred taxes, and other non-recurring items, with Adjusted diluted earnings per share calculated by dividing Adjusted net income (loss) by the diluted weighted average shares outstanding, both being key measures for management, the board, and external parties - Adjusted net income (loss) excludes equity-based compensation, executive transition costs, severance, strategic project costs, merger and acquisition costs, change in valuation allowance for deferred taxes, and other non-recurring items[14](index=14&type=chunk) - Adjusted diluted earnings per share is Adjusted net income (loss) divided by the diluted weighted average number of common shares outstanding[14](index=14&type=chunk) - These are key measures used by management, the board, analysts, and investors to assess financial performance[13](index=13&type=chunk) [GAAP to Non-GAAP Reconciliation](index=10&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliation) The reconciliation tables provide a detailed breakdown of adjustments made to GAAP net income (loss) to arrive at Adjusted EBITDA and Adjusted net income (loss) for both the three and nine months ended June 28, 2025, and June 29, 2024, with key adjustments including depreciation and amortization, equity-based compensation, strategic project costs, executive transition costs, and changes in valuation allowance for deferred taxes GAAP to Non-GAAP Reconciliation (Thousands) | Metric (Thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | Nine Months Ended June 28, 2025 | Nine Months Ended June 29, 2024 | | :--------------------------------- | :------------------------------- | :------------------------------- | :------------------------------ | :------------------------------ | | Net income (loss) | $21,730 | $60,650 | $(74,154) | $(13,456) | | Interest expense | $15,764 | $18,156 | $47,425 | $53,380 | | Income tax expense (benefit) | $30,824 | $18,889 | $6,969 | $(9,227) | | Depreciation and amortization expense | $8,572 | $8,246 | $25,080 | $24,419 | | Equity-based compensation expense | $1,581 | $2,246 | $5,242 | $7,683 | | Strategic project costs | $1,056 | $395 | $1,836 | $1,058 | | Executive transition costs and other | $2,043 | $887 | $3,795 | $1,914 | | **Adjusted EBITDA** | **$81,570** | **$109,469** | **$16,193** | **$65,771** | | Net income (loss) | $21,730 | $60,650 | $(74,154) | $(13,456) | | Equity-based compensation expense | $1,581 | $2,246 | $5,242 | $7,683 | | Strategic project costs | $1,056 | $395 | $1,836 | $1,058 | | Executive transition costs and other | $2,043 | $887 | $3,795 | $1,914 | | Change in valuation allowance | $16,930 | — | $21,496 | — | | Tax effects of these adjustments | $(5,403) | $(881) | $(8,092) | $(2,664) | | **Adjusted net income (loss)** | **$37,937** | **$63,297** | **$(49,877)** | **$(5,465)** | | Diluted earnings per share | $0.12 | $0.33 | $(0.40) | $(0.07) | | **Adjusted diluted earnings per share** | **$0.20** | **$0.34** | **$(0.27)** | **$(0.03)** | [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This press release contains forward-looking statements subject to substantial risks and uncertainties, which could cause actual results to differ materially from those indicated, as these statements are based on current expectations and projections, but new risks can emerge, and investors are cautioned not to unduly rely on these statements, as the company undertakes no obligation to update them - All statements other than historical facts are forward-looking and involve substantial risks and uncertainties[15](index=15&type=chunk) - Actual results could differ materially due to various factors, including execution of growth strategies, cash resources, supply disruptions, competition, weather sensitivity, economic changes, and regulatory developments[16](index=16&type=chunk)[17](index=17&type=chunk) - The company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date of the press release, except as required by law[19](index=19&type=chunk) [Investor Information](index=2&type=section&id=Investor%20Information) This section provides essential details for investors, including information on upcoming conference calls and contact details for investor and public relations inquiries [Conference Call Details](index=2&type=section&id=Conference%20Call%20Details) Leslie's, Inc. will host a conference call on August 6, 2025, at 5:00 p.m. Eastern time to discuss Q3 FY2025 financial results and strategic transformation initiatives, with a live audio webcast and replay available on the company's Investor Relations website - Conference call to discuss Q3 FY2025 financial results and strategic transformation initiatives on **August 6, 2025, at 5:00 p.m. Eastern time**[6](index=6&type=chunk) - Live audio webcast available online at https://ir.lesliespool.com/[6](index=6&type=chunk) - Replay of the conference call will be available on the Investor Relations website for **180 days**[7](index=7&type=chunk) [Contact Information](index=6&type=section&id=Contact%20Information) For investor and public relations inquiries, Elisabeth Eisleben, Senior Vice President, Investor & Public Relations, can be contacted via email - Contact: Elisabeth Eisleben, Senior Vice President, Investor & Public Relations[20](index=20&type=chunk) - Email: investorrelations@lesl.com[20](index=20&type=chunk)

Core Insights - Leslie's, Inc. reported financial results for the third quarter of fiscal 2025, indicating a challenging sales environment during the peak selling season due to adverse weather and competitive pricing pressures [2][4][5] - The company is focusing on cost mitigation strategies and strategic initiatives to enhance profitability and long-term growth [3][4] Financial Performance - Total sales for the third quarter were $500.3 million, a decrease of 12.2% from $569.6 million in the same period last year [5] - Comparable sales decreased by 12.4%, with new store contributions of $1.2 million [5] - Gross profit was $197.9 million, down 13.5% from $228.8 million, resulting in a gross margin of 39.6% compared to 40.2% in the prior year [5] - Net loss for the quarter was $21.7 million, compared to a net income of $60.7 million in the prior year [5][23] - Adjusted net loss ranged from $31 million to $39 million, with adjusted EBITDA between $50 million and $60 million for the full fiscal year [4] Cash Flow and Liquidity - Cash and cash equivalents decreased to $42.7 million as of June 28, 2025, down from $74.4 million a year earlier [5][27] - The company repaid approximately $27 million on its Term Loan during the nine months ended June 28, 2025 [4] Strategic Initiatives - The management is conducting a strategic and operational review to stabilize the company and position it for long-term growth [3] - Additional resources have been allocated to support the execution of strategic priorities aimed at improving profitability [2][3] Market Position - Leslie's is recognized as the largest direct-to-customer brand in the U.S. pool and spa care industry, serving both residential customers and pool professionals [9]

Core Insights - Leslie's, Inc. announced preliminary estimated financial results for Q3 fiscal 2025, indicating a challenging quarter due to adverse weather conditions impacting pool season [1][4][10] - The company is withdrawing its previously provided fiscal year 2025 guidance and plans to update expectations during the upcoming earnings call [3][6] Financial Performance - Net sales for the quarter are approximately $500 million, reflecting a decline of about 12% compared to the same quarter last year [10] - Estimated net income ranges from $20 million to $22 million, with adjusted net income projected between $35 million and $38 million [10][27] - Adjusted EBITDA is estimated to be between $79 million and $82 million [10][27] - Diluted earnings per share are expected to be between $0.11 and $0.12, while adjusted diluted earnings per share are projected to be between $0.19 and $0.21 [10][28] Strategic Initiatives - The CEO highlighted ongoing strategic and operational reviews aimed at improving sales and profitability, focusing on performance across various business segments [4][5] - The company is working with external resources to accelerate its return to long-term profitable growth, maintaining a cash balance of approximately $43 million at the end of the quarter [5][10] Upcoming Events - A conference call is scheduled for August 6, 2025, to discuss the financial results and progress on strategic transformation initiatives [6][7]

Core Viewpoint - Leslie's, Inc. is set to release its fiscal 2025 third quarter financial results on August 6, 2025, after market close, highlighting its ongoing strategic transformation initiatives [1][2]. Company Overview - Founded in 1963, Leslie's is the largest direct-to-customer brand in the U.S. pool and spa care industry, catering to both residential customers and pool professionals nationwide [3]. - The company offers a wide range of essential pool and spa care products through an integrated ecosystem of over 1,000 physical locations and a robust digital platform, allowing consumers to shop conveniently [3]. - Leslie's employs a dedicated team of associates and experts in pool and spa care, aiming to empower consumers with the necessary knowledge and solutions for maintaining their pools and spas [3]. Upcoming Events - A conference call will be held on August 6, 2025, at 5:00 p.m. Eastern time to discuss the financial results and the company's strategic initiatives, with a live webcast available online [2]. - A replay of the conference call will be accessible within approximately three hours after the call and will remain available for 180 days on the company's Investor Relations website [2].

Core Insights - Leslie's, Inc. has appointed Amy College as the new Chief Merchandising and Supply Chain Officer effective July 20, 2025, succeeding Moyo LaBode who left the company on July 15, 2025 [1][2] Company Overview - Leslie's, Inc. is the largest direct-to-customer brand in the U.S. pool and spa care industry, serving both residential customers and pool professionals nationwide [4] - The company operates over 1,000 physical locations and a robust digital platform, providing a wide range of essential pool and spa care products [4] Leadership Experience - Amy College brings over 25 years of retail operations leadership experience, having previously served as Chief Merchandising and Supply Chain Officer at Petco and held various leadership roles at Best Buy [2][3] - Her responsibilities will include merchandising, inventory, supply chain, logistics, manufacturing, and overseeing the company's digital marketplace business [1][2] Strategic Vision - The CEO of Leslie's expressed confidence in Amy College's strategic vision and operational expertise, highlighting her values-driven leadership style and commitment to customer experience as key factors for the company's transformation initiatives [3]

Financial Performance & Growth - FY21 sales reached over $1.3 billion, with a 20.7% sales growth[14] - FY21 Adjusted EBITDA was $271 million, reflecting a 48.0% growth[14] - First half of Fiscal Year 2022 (1H22) sales were $413 million, a 22% increase[26] - 1H22 Adjusted EBITDA grew by 5.5% to $10 million, with an Adjusted EBITDA margin of 2.4%[26] - The company revised its Fiscal Year 2022 sales guidance to $1.575 billion - $1.610 billion, representing a 17%-20% growth[30] - Revised Fiscal Year 2022 Adjusted EBITDA guidance is $315 million - $330 million, a 16%-22% increase[30] Strategic Initiatives & Market Position - The U.S pool & spa aftermarket opportunity is estimated at $14 billion[21] - The company operates 970 locations across 39 states[23, 29] - Digital properties capture 60% of specialty direct-to-consumer pool traffic[23] - The PRO business grew by 27% in 1H22 and accounts for approximately 15% of Last Twelve Months (LTM) total sales[29]

Company Overview - Leslie's is the largest direct-to-consumer brand in the pool and spa care industry, with fiscal year 2021 sales exceeding $1.3 billion, representing a 20.7% sales growth[14] - The company's adjusted EBITDA for fiscal year 2021 was $271 million, a 48% increase[14] - Leslie's operates 970 locations across 39 states[24] Market Opportunity - The U S pool and spa aftermarket opportunity is estimated at $14 billion[22, 35] - The addressable market includes 8.7 million residential pools representing a $7.6 billion total addressable market (TAM)[31] - There are 5.5 million addressable spas representing a $2 billion TAM[33] - The professional pool market includes 250,000 commercial pools and 45,000 pool professionals, representing a $4.3 billion TAM[35] Growth & Financial Performance - First half of fiscal year 2022 sales reached $413 million, a 22% increase[82] - The company's first half of fiscal year 2022 adjusted EBITDA grew by 5.5% to $10 million[82] - The PRO business grew by 27% in the first half of fiscal year 2022 and represents approximately 15% of last twelve months (LTM) total sales[85] Fiscal Year 2022 Guidance - Revised fiscal year 2022 sales guidance is between $1.575 billion and $1.61 billion, representing a 17%-20% growth[89] - Revised fiscal year 2022 adjusted EBITDA is projected to be between $315 million and $330 million, a 16%-22% increase[89]

Investment Rating - The report assigns a Neutral rating on Leslie's Inc. (LESL) with a 12-month price target of $3 based on EV/EBITDA multiples of 8.0x/9.0x/10.0x for downside/base/upside cases [40]. Core Insights - Memorial Day weekend demand for pools was in line with the previous year, and similar sales are expected for the summer, with chemical sales likely to remain stable but discretionary sales anticipated to decline [1][3]. - Google search trends indicate an increase in interest for pool-related topics in key states, suggesting a potential uptick in demand, although Leslie's Pool Supplies experienced a decline in search interest [19][24]. - Approximately 75% of surveyed retailers do not view Leslie's or Walmart as strong competitors in the pool supply market [3][16]. Summary by Sections Survey Results - A survey of 27 independent specialty pool retailers indicated that demand during Memorial Day 2025 was consistent with 2024, with no expectations for increased demand for chemicals or discretionary items [2][3]. - Retailers expressed that prices for pool supplies are not expected to be lower than the previous year [10]. Google Search Trends - Google search interest for "pool" in April and May 2025 remained stable compared to 2024, with increases noted against 2023 and pre-pandemic levels [24]. - Searches for Leslie's Pool Supplies showed a decline in interest compared to previous years, indicating potential challenges for the company [24][31]. Market Competitiveness - The majority of retailers surveyed do not consider Leslie's or Walmart as significant competitors, with 22% affirming Leslie's as a competitor and 5% for Walmart [3][16]. - Retailers are cautious about the competitive landscape, with many not expecting significant changes in market dynamics [3].

Core Insights - Leslie's, Inc. has launched a refreshed Pool Perks Rewards Program featuring loyalty tiers aimed at enhancing customer experience and engagement [1][2] Company Overview - Founded in 1963, Leslie's is the largest direct-to-customer brand in the U.S. pool and spa care industry, serving both residential customers and pool professionals [5] - The company operates over 1,000 physical locations and a robust digital platform, providing a wide range of essential pool and spa care products [5] Pool Perks Rewards Program - The new tiered rewards program allows members to earn 1 point per dollar spent, with additional benefits as they progress through the tiers [3] - Members receive qualified free shipping on orders over $75, and are eligible for local events and unique bonuses throughout the year [3][4] - Perks Members earn a $1 reward for every 50 points, Perks Elite Members earn a $1 reward for every 33 points and receive a $5 bonus reward, while Perks MVP Members earn a $1 reward for every 20 points and receive a $10 bonus reward [6]

Core Insights - Leslie's, Inc. has launched a refreshed Pool Perks Rewards Program featuring loyalty tiers aimed at enhancing customer experience and engagement [1][2] - The program is designed to reward residential customers for their purchases while promoting customer centricity and convenience [2] Program Details - Members earn 1 point per dollar spent, qualify for free shipping, and can participate in local events and bonuses as they progress through the loyalty tiers [3] - Perks and Perks Elite members receive free shipping on orders over $75, with additional charges for oversized items and same-day delivery [4] - Members can start earning rewards by visiting local stores or signing up online [4] Membership Benefits - Perks Members earn a $1 reward for every 50 points, while Perks Elite Members earn a $5 bonus reward and a 25% off coupon upon becoming an Elite Member, earning $1 for every 33 points [6] - Perks MVP Members receive a $10 bonus reward and a 50% off coupon upon becoming an MVP Member, earning $1 for every 20 points [6] Company Overview - Founded in 1963, Leslie's is the largest direct-to-customer brand in the U.S. pool and spa care industry, serving both residential customers and pool professionals [5] - The company operates over 1,000 physical locations and a robust digital platform, providing a wide range of essential pool and spa care products [5]