Financial Data and Key Metrics Changes - Net sales for Q4 2023 were $91 million, down from $108 million in Q4 2022, reflecting lower volumes and a 23% decline in in-ground pool sales [89] - Full year net sales were $566 million, compared to $696 million in the prior year, with in-ground swimming pool sales down 23% year-over-year [90] - Adjusted EBITDA for the full year was $88 million, down from $143 million in the prior year, resulting in an adjusted EBITDA margin of 15.5% compared to 20.6% in 2022 [91] - Gross margin for Q4 2023 reached 23.3%, an increase of 540 basis points from 17.9% in Q4 2022, driven by cost reduction programs [74] Business Line Data and Key Metrics Changes - Liner sales for the full year were $128 million, down 16%, while cover sales were $141 million, declining 11% [75] - Fiberglass product sales accounted for approximately 73% of in-ground pool sales for the full year 2023, with a compounded annual growth rate of about 15% since 2019 [85] - Sales of fiberglass pools declined 20% year-over-year, which was about 10 percentage points better than the overall market decline [5] Market Data and Key Metrics Changes - Fiberglass now accounts for approximately 22% of new pool starts in the U.S., up from 21% in 2022 and 18% in 2021, indicating a growing market share [69] - The overall U.S. new in-ground pool installation market is estimated to have declined by 30% in 2023 compared to 2022 [90] - The company anticipates a 15% decline in new pool starts for 2024, reflecting cautious market conditions [117] Company Strategy and Development Direction - The company is focused on driving the adoption of fiberglass pools and automatic safety covers, aiming to capture additional market share as conditions improve [95] - Continued investments in cost reduction, lean manufacturing, and digital transformation are prioritized to enhance operational efficiency [95] - The company plans to leverage its strong dealer network and consumer engagement to increase fiberglass penetration in markets dominated by concrete pools [85] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2024, noting that lower interest rates and improved consumer confidence are not expected to benefit the peak pool buying season [72] - The company is positioned to capitalize on a potential market recovery in 2025, with expectations of increased pool starts [121] - Management highlighted the importance of maintaining flexibility in pricing strategies to stimulate demand amid current economic conditions [152] Other Important Information - The company ended 2023 with a record cash position of over $100 million, providing substantial financial flexibility [68] - Capital expenditures for 2023 were $33 million, down from $40 million in the prior year, with projections for 2024 ranging from $18 million to $22 million [76][77] - The company repaid $13 million of term debt in 2023, ending the year with total debt of $301 million and a net debt leverage ratio of 2.25 [76][128] Q&A Session Summary Question: How is the company managing the balance sheet for 2024? - The company is pleased with its cash flow generation and has reduced net working capital, especially inventory, leading to a cash position of $102.8 million at year-end [12] Question: What are the key items to consider for 2024 EBITDA guidance? - Key items include the impact of lower volume and fixed costs, modest deflation, and ongoing investments in lead generation and fiberglass conversion [99] Question: What is the outlook for gross margins in 2024? - Gross margins are expected to remain roughly in line with 2023 levels, with slight tailwinds from cost containment actions [134] Question: How is the company positioned for a potential market recovery? - The company has a strong vendor base and supply chain, allowing for quick adjustments to production if market conditions improve [49] Question: What is the current capacity utilization rate? - The company is in a good position regarding capacity utilization, with no immediate need for additional plants [138]

Exhibit 99 Latham Group, Inc. Reports Fourth Quarter and Full Year 2023 Financial Results and Provides 2024 Guidance Full Year 2023 Sales Outperformed the U.S. In-Ground Pool Market in 2023 Driven by Continued Fiberglass Conversion Substantially Reduced Cost Structure During 2023 Full Year Operating Cash Flow of $116 Million Yielded Record Cash Position of $100 Million at Year-End 2024 Guidance Anticipates Continued Ability to Outperform Industry Amid Difficult Market Conditions Fourth Quarter 2023 Highligh ...

Latham Group, Inc. (NASDAQ:SWIM) Q3 2023 Earnings Conference Call November 7, 2023 9:00 AM ET Company Participants Nicole Harlowe - IR Scott Rajeski - President and CEO Mark Borseth - Interim CFO Oliver Gloe - Incoming CFO Conference Call Participants Ryan Merkel - William Blair Anika Dholakia - Barclays Shaun Calnan - Bank of America Keith Hughes - Truist Charles Perron-Piche - Goldman Sachs Operator Good day, and welcome to the Latham Group Third Quarter Fiscal 2023 Earnings Conference Call. [Operator Ins ...

Financial Performance - Net sales decreased by 15.1%, or $28.6 million, to $160.8 million for the fiscal quarter ended September 30, 2023, compared to $189.4 million for the same quarter in 2022[113]. - Net income decreased by $5.7 million to $6.2 million, representing a 3.8% net income margin for the fiscal quarter ended September 30, 2023, compared to net income of $11.9 million for the same quarter in 2022[113]. - Adjusted EBITDA decreased by $6.2 million to $36.1 million for the fiscal quarter ended September 30, 2023, compared to $42.3 million for the same quarter in 2022[113]. - For the three fiscal quarters ended September 30, 2023, net sales decreased by 19.1%, or $112.2 million, to $475.6 million compared to $587.8 million for the same period in 2022[113]. - Net income was $6.2 million for the fiscal quarter ended September 30, 2023, a decrease of $5.7 million, or 48.2%, compared to the same quarter in the previous year[134]. - Adjusted EBITDA decreased by $60.8 million, or 43.7%, to $78.1 million for the three fiscal quarters ended September 30, 2023, compared to $138.9 million for the same period in 2022[152]. Cost Management - The company expects to realize $18.0 million in total cost savings in 2023 due to cost reduction plans initiated in response to economic uncertainty[115]. - Selling, general, and administrative expenses decreased by $3.3 million, or 12.4%, to $23.4 million for the fiscal quarter ended September 30, 2023[128]. Operational Changes - The company is focusing on converting from concrete to fiberglass swimming pools, supported by lead generation efforts and dealer strategy[114]. - The Kingston, Ontario facility was completed in April 2023, along with acquired fiberglass manufacturing assets in Seminole, Oklahoma[114]. - The company operates approximately 2,000 employees across over 30 locations, dedicated to designing and manufacturing high-quality pool products[110]. Debt and Financing - Interest expense, net increased by $12.1 million, or 131.4%, to $21.3 million for the three fiscal quarters ended September 30, 2023[145]. - The Term Loan matures on February 23, 2029, with outstanding borrowings of $301.6 million as of September 30, 2023[167][169]. - The company has a stock repurchase program authorized for up to $100 million, with $77.0 million remaining available for repurchases as of September 30, 2023[170]. Cash Flow and Liquidity - As of September 30, 2023, the company had $78.1 million in cash, $301.6 million in outstanding borrowings, and $75.0 million available under its Revolving Credit Facility[160]. - For the three fiscal quarters ended September 30, 2023, net cash provided by operating activities was $88.1 million, a significant increase from $5.2 million in the same period last year[173][174]. - The company reported a net cash increase of $45.5 million for the three fiscal quarters ended September 30, 2023, compared to a decrease of $13.3 million in the prior year[172]. Inventory and Receivables - The company experienced a $61.7 million decrease in inventories, contributing positively to cash flow, while trade receivables increased by $28.7 million due to the timing of net sales[173]. Future Considerations - The company plans to perform a quantitative assessment for goodwill impairment testing as of October 1, 2023, which may result in a non-cash impairment charge in the fiscal quarter ended December 31, 2023[186]. - A leadership transition was announced with Oliver Gloe appointed as Chief Financial Officer effective November 13, 2023[116]. Market Position - The company holds the 1 position in North America in every product category in which it competes[106]. Margins - Gross margin decreased by 1.2% to 29.9% of net sales for the fiscal quarter ended September 30, 2023, compared to 31.1% for the same quarter in the previous year[127]. - Gross margin for the three fiscal quarters ended September 30, 2023, decreased by 5.8% to 27.7% of net sales compared to 33.5% for the same period in the previous year[141]. - Adjusted EBITDA margin was 16.4% for the three fiscal quarters ended September 30, 2023, down from 23.6% for the same period in 2022, primarily due to the decrease in net sales[153]. Taxation - Effective tax rate was 140.7% for the three fiscal quarters ended September 30, 2023, compared to 65.6% for the same period in the previous year[149]. - Net loss margin was 0.5% for the three fiscal quarters ended September 30, 2023, compared to a net income margin of 2.3% for the same period in 2022, reflecting a $15.8 million increase in net loss and a $112.2 million decrease in net sales[151].

Nicole Harlowe - IR Scott Rajeski - President and CEO Mark Borseth - Interim CFO Operator Nicole Harlowe Scott Rajeski Company Participants Tim Wojs - Baird Keith Hughes - Truist Shaun Calnan - Bank of America Matt Bouley - Barclays Andrew Carter - Stifel Susan Maklari - Goldman Sachs I would like now to turn the conference over to Nicole Harlowe, Investor Relations representative. Please go ahead. On today's call are Latham's President and CEO, Scott Rajeski; and Interim CFO, Mark Borseth. Following their ...

Disclaimer Adjusted EBITDA and Adjusted EBITDA Margin Although depreciation and amortization are eliminated in the calculation of Adjusted EBITDA and Adjusted EBITDA margin, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA and Adjusted EBITDA margin do not reflect any costs of such replacements. Net sales and Adjusted EBITDA results above our expectations in spite of the continued challenging macroeconomic environment and 1 difficult year-over-year ...

Financial Data and Key Metrics Changes - The company reported net sales of $138 million for Q1 2023, a decrease of $54 million or 28% compared to Q1 2022, which had set a high record due to elevated backlogs and increased production levels [65][88] - Adjusted EBITDA for Q1 was $11 million, down $37 million or 77% from Q1 2022, with an adjusted EBITDA margin of 8%, down from 25% in the prior year [13][66] - Gross profit decreased by $38 million or 53% year-over-year, with gross margin dropping to 24.2% from 36.9% [105] Business Line Data and Key Metrics Changes - In-ground pool sales declined 30% to $79 million, driven by wholesaler destocking and lower fiberglass pool sales compared to the strong Q1 2022 [102] - Sales of liners fell 44% to $26 million, also impacted by strong sales in the previous year due to elevated backlogs [102] - Sales for the cover product line remained flat year-over-year at $33 million, indicating strength in the automatic safety covers market [70] Market Data and Key Metrics Changes - The U.S. fiberglass penetration expanded to 21% in 2022, gaining 3 points of share despite a 16% decline in overall U.S. in-ground pool installations [74][84] - The company noted that much of the softness in overall U.S. pool starts was in the concrete pool market, particularly in regions where they are underpenetrated [87] Company Strategy and Development Direction - The company is focused on recruiting new dealers and enhancing lead generation efforts, which have shown momentum in website activity and lead generation tools [5][25] - The company aims to drive material conversion from concrete to fiberglass pools, supported by lead generation and digital tools [73][84] - The launch of "Measure by Latham," an AI-powered digital measuring tool, is expected to modernize the measurement experience for dealers and drive growth in winter safety covers and in-ground liners [86][101] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals and growth opportunities despite macroeconomic challenges, including higher interest rates and inflation [67][74] - The company anticipates a normalization of packaged pool inventory in the wholesale distribution channel to remain a headwind through the first half of 2023 [72] - Management reaffirmed the fiscal year 2023 outlook for net sales of $565 million to $615 million and adjusted EBITDA of $90 million to $110 million [107] Other Important Information - The company has implemented cost reduction initiatives expected to yield annualized savings of about $12 million in fiscal 2023 [81] - Capital expenditures for Q1 were $10 million, up from $7 million in the same period last year, primarily for investments in manufacturing facilities [72] Q&A Session All Questions and Answers Question: Can you talk about where you outperformed versus your expectations coming into the year? - Management noted that they outperformed slightly in all three product lines, reflecting stronger demand than expected, but it is still early in the season to consider raising guidance [95] Question: What are you hearing from your dealers in terms of backlogs and leads turning into actual projects? - Management indicated that dealers still have good backlogs through the first half of the year and are focusing on driving lead generation to maintain activity in the second half of 2023 [104]

Table of Contents 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 December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-40358 LATHAM GROUP, Inc. (Exact name of registrant as specified in its charter) Delaware 83-2797583 (State or other jurisdict ...

Latham Group, Inc. (NASDAQ:SWIM) Q4 2022 Earnings Call Transcript March 7, 2023 9:00 AM ET Company Participants Nicole Harlowe Edelman - Investor Relations Scott Rajeski - President & Chief Executive Officer Rob Masson - Chief Financial Officer Conference Call Participants Elizabeth Langan - Barclays Tim Wojs - Baird Sean Callan - Bank of America Charles Perron-Piché - Goldman Sachs Josh Pokrzywinski - Morgan Stanley Andrew Carter - Stifel Operator Good morning, and welcome to the Latham Group, Inc. Fourth ...

Q4 & FY 2022 Earnings Call March 7, 2023 Nasdaq Listed Forward-looking Statements Certain statements in this presentation constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this presentation other than statements of historical fact may constitute forward-looking statements, including statements regarding our future operating results and financial position, our business strategy and plans, business and market trends, o ...