Q.E.P. Co., Inc. Reports Fiscal 2026 First Quarter Financial Results and Declares Second Quarter Cash Dividend

Core Points - Q.E.P. Co., Inc. reported a net sales decline of 3.1% to $61.5 million for the first quarter ended May 31, 2025, primarily due to reduced home improvement spending amid high interest rates and economic uncertainty [2][4] - The company's gross profit increased slightly to $22.7 million, with a gross margin improvement to 36.9% from 35.4% year-over-year, attributed to inventory sell-through before tariff increases [3][4] - Net income for the quarter was $4.4 million or $1.36 per diluted share, compared to $4.5 million or $1.34 per diluted share in the prior year [6][15] - The company declared a quarterly cash dividend of $0.20 per share, reflecting its commitment to returning value to shareholders [10] Financial Performance - Net sales decreased by $2.0 million or 3.1% from the previous year [2] - Gross profit increased by $0.2 million or 0.1% year-over-year [3] - Operating expenses totaled $16.9 million, representing 27.4% of net sales, slightly up from 27.2% in the prior year [4] - EBITDA from continuing operations rose to $6.1 million or 10.0% of net sales, compared to $5.6 million or 8.8% in the same quarter last year [7] Cash Flow and Balance Sheet - Cash provided by operating activities was $2.6 million, down from $6.1 million in the prior year, due to a strategic inventory build [8] - As of May 31, 2025, working capital was $70.2 million, an increase from $67.4 million at the end of fiscal 2025 [9] - Aggregate available cash, net of outstanding debt, was $30.4 million, up from $28.4 million at the end of fiscal 2025 [9] Strategic Developments - The company opened a new adhesive production facility in Dalton, Georgia, enhancing its domestic manufacturing capabilities [4] - Q.E.P. continues to focus on expanding its sourcing capabilities and improving operational efficiencies [4]