Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $111.4 million, slightly above $110.6 million in Q1 2024, reflecting positive momentum in fiberglass pools and auto covers [17] - Gross margin increased by 190 basis points to approximately 30% from 28% in the prior year, driven by lean manufacturing and value engineering initiatives [18][19] - SG&A expenses rose to $31 million, up from $26 million in Q1 2024, primarily due to strategic investments in sales and marketing [19] Business Line Data and Key Metrics Changes - Inbound pool sales were $58 million, down 4% from Q1 2024, impacted by soft industry conditions and adverse weather [18] - Cover sales increased by 18% to $32 million, benefiting from organic growth and acquisitions [18] - Liner sales decreased by 8% to $22 million compared to the previous year [18] Market Data and Key Metrics Changes - Fiberglass pools are expected to gain an additional 1% market share in the in-ground pool sector in 2025, driven by cost advantages and easier installation compared to concrete pools [6] - Labor scarcity is seen as a tailwind for fiberglass pools, with 46% of pool builders citing limited access to qualified labor as a significant issue [7] Company Strategy and Development Direction - The company is focusing on expanding its presence in Florida, Texas, Arizona, and California, which account for about two-thirds of annual new pool starts [13] - Key priorities include expanding the dealer base, targeting master plan communities, aligning product offerings with market demand, and targeted marketing campaigns [13] - The company aims to significantly increase its market share in the Sand States through strategic partnerships and new product launches [14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the pool market, maintaining expectations for 2025 revenue growth of 8% at the midpoint [23] - The company anticipates continued progress in fiberglass awareness and adoption initiatives, supported by positive feedback from dealers and increased consumer engagement [22] - Management noted that the current business trends are encouraging, with a solid start to 2025 and expectations for higher year-on-year comparisons in the stronger second and third quarters [24] Other Important Information - The company announced the resignation of its Chief Commercial Officer, with confidence in the strength of its commercial team to continue executing the sales and marketing strategy [16] - Capital expenditures are expected to range between $27 million and $33 million in 2025, reflecting investments in new production modes and facility expansions [21] Q&A Session Summary Question: Outlook for margin expansion and SG&A leverage - Management indicated that SG&A leverage is expected to increase as year-over-year growth sets in, with sales projected to increase by about 8% [27] Question: Reaction to new molds and marketing efforts in Sand States - Management reported positive trends in sales and strong progress with builders in Florida, indicating an acceleration in market share gains [28][30] Question: Risks and opportunities in the fiberglass pool market - Management noted that while the decision to purchase a pool is a long-term process, they have not seen any slowdown in consumer interest or buying decisions [36][39] Question: Impact of tariffs on costs and pricing strategy - Management quantified the tariff headwind at approximately 350 to 400 basis points, with pricing increases aimed at mitigating the remaining impact [41][42] Question: Demand environment and consumer appetite for automatic safety covers - Management confirmed strong demand for auto covers, with high attachment rates on new pools and significant interest in safety features [75][72]