Financial Data and Key Metrics Changes - Net sales increased by 7% to $244 million, driven by a 5% increase in net price and a 2% increase in volume [4][7][15] - Adjusted EBITDA increased by 16% to $59 million, with adjusted EBITDA margin expanding by 170 basis points to 24.2% [4][7][15] - Gross profit margin increased by 150 basis points to 51.2% [4][7][15] - Net leverage reduced to 1.8x, the lowest level in nearly four years [5][19] Business Line Data and Key Metrics Changes - North American net sales increased by 7% to $208 million, with net price realization increasing by 7% and stable volume [16][17] - European and rest of the world net sales increased by 11% to $36 million, with an 8% increase in volume offsetting a 1% reduction in net price realization [17][18] Market Data and Key Metrics Changes - Strong demand trends were reported, particularly in North America and Canada, with Canada seeing over 20% growth [8][27] - The aftermarket model remains resilient, with approximately 85% of sales aligned with serving the aftermarket needs of the existing installed base [8][9] Company Strategy and Development Direction - The company is focused on expanding customer relationships, developing innovative products, and leveraging operational excellence capabilities [5][6] - Investments are being made in advanced engineering and product development, particularly with the introduction of the OmniX automation platform [11][12][34] - The company is also pursuing additional acquisition opportunities in residential and commercial pool sectors [21][47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and raised full-year guidance for net sales and adjusted EBITDA [6][22][23] - The company anticipates solid cash flow generation and a conversion of greater than 100% of net income [23] - Management noted that the macroeconomic and tariff environment continues to evolve, but they remain positive about the long-term growth outlook for the pool industry [24][23] Other Important Information - The company is implementing AI tools to enhance customer service, with new AI agents resolving approximately 80% of inbound calls without human intervention [14][13] - The company has authorized a share repurchase program of up to $450 million over three years [21][22] Q&A Session Summary Question: Demand trends since July and upside in Q3 - Management noted strong sales out demand, particularly in September, and highlighted improved performance in Canada and Europe [26][27][28] Question: Early buy program and price increase reception - The early buy program is tracking well, with discounts offered to mitigate price increases due to inflation and tariffs [29][30] Question: Investments in new products and their impact on sales - The company is making targeted investments in new product development, particularly in technology and innovation, which is expected to drive future sales [33][34] Question: Impact of private label competition - Management believes that their loyal dealer base will continue to appreciate the value proposition of Hayward products despite competition from lower-priced alternatives [40][41] Question: Increase in cash flow guidance - The increase in cash flow guidance is attributed to improved EBITDA, project timing, and working capital management [43][44] Question: International market margin improvements - European margins improved due to stabilization of production capabilities and a cumulative tariff refund [74][75] Question: Tariff refunds and supply chain realignment - The company is actively pursuing tariff refunds and has made significant progress in reducing exposure to China [82][84]

Financial Data and Key Metrics Changes - Net sales increased by 7% to $244 million, driven by a 5% increase in net price and a 2% increase in volume [4][7][15] - Adjusted EBITDA increased by 16% to $59 million, with an adjusted EBITDA margin of 24.2%, up 170 basis points [4][7][15] - Gross profit margin expanded by 150 basis points to 51.2% [4][15] - Cash flow from operations year-to-date was $283 million, compared to $276 million in the previous year [20] Business Line Data and Key Metrics Changes - North American net sales increased by 7% to $208 million, with a 7% increase in net price realization and stable volume [16][17] - European and rest of the world net sales increased by 11% to $36 million, with an 8% increase in volume offsetting a 1% reduction in net price realization [17][18] - Adjusted segment income margins in Europe increased to 18.5% from 8.4% a year ago [18] Market Data and Key Metrics Changes - Strong demand trends were reported, particularly in Canada, which saw over 20% growth [28] - The U.S. market experienced improved out-the-door sales growth rates for Hayward products, especially in September [8][26] - The aftermarket model remains resilient, with approximately 85% of sales aligned with serving existing installed base needs [8][9] Company Strategy and Development Direction - The company is focusing on expanding customer relationships, developing innovative products, and leveraging operational excellence [5][6] - Strategic initiatives include tariff mitigation actions and investments in advanced engineering and product development [11][12] - The company is also pursuing additional acquisition opportunities in residential and commercial pool sectors [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and raised full-year guidance for net sales and adjusted EBITDA [6][22] - The company expects net sales to increase approximately 4% to 5.5% for the full year, with adjusted EBITDA projected to increase by 5% to 7% [22][23] - Management noted that the macroeconomic and tariff environment continues to evolve, but they remain positive about long-term growth in the pool industry [24] Other Important Information - The company has reduced net leverage to 1.8 times, the lowest level in nearly four years, providing enhanced financial flexibility [5][19] - The board authorized a share repurchase program of up to $450 million over three years [21] Q&A Session Summary Question: How did the season progress since July, and where did you see the upside in the third quarter? - Management noted strong sales out demand, particularly in September, and highlighted improved performance in Canada and Europe [26][28] Question: How do you think about the early buy program relative to the market being flat? - Management indicated that the early buy program is tracking expectations and that they are managing price increases carefully to mitigate inflation impacts [30][31] Question: Can you discuss your investments in new products and how they are impacting sales? - Management emphasized targeted investments in engineering and new product development, particularly with the OmniX platform, which is expected to drive future growth [34][36] Question: What are your capital allocation priorities moving forward? - Management stated that they will focus on organic capex, M&A opportunities, and share repurchases, with an emphasis on automation and supply chain improvements [49][50] Question: How are you addressing the impact of tariffs and supply chain realignment? - Management reported significant progress in reducing exposure to China and successfully applying for tariff refunds, which positively impacted margins [82][84]

Financial Data and Key Metrics Changes - The company reported net sales of $1.5 billion for Q3 2025, reflecting a 1% year-over-year increase, with gross margin expanding by 50 basis points to 29.6% [4][22][23] - Diluted EPS increased by 4% to $3.40 from $3.27 in the same quarter last year [23] - Operating income improved by $2 million year-over-year, totaling $178 million for the quarter [23] Business Line Data and Key Metrics Changes - Maintenance product sales performed well, particularly in parts and private label chemical volumes [4][8] - Building materials sales increased by 4%, driven by private label offerings and customer experience enhancements [10] - Equipment sales, excluding cleaners, also rose by 4%, primarily due to price benefits and steady replacement volume [11] Market Data and Key Metrics Changes - Florida experienced 1% growth, while Texas remained flat, and California and Arizona each saw a 3% decline [8] - In Europe, net sales decreased by 1% in local currency but increased by 6% in U.S. dollars, with southern countries showing growth [9] - Chemical sales declined by 4% due to deflation, but overall demand for chemicals was considered stable [9][10] Company Strategy and Development Direction - The company shared a strategic roadmap focused on innovation and growth plans during its International Sales Conference [5] - Investments in technology, particularly the POOL360 platform, are seen as key differentiators and are driving customer adoption [14][16] - The company aims to expand its market share through strategic acquisitions and new sales center openings, with a target of 8 to 10 new centers for the year [15][24] Management's Comments on Operating Environment and Future Outlook - Management noted that uncertainty around tariffs and high borrowing rates are impacting consumer sentiment and discretionary spending [6] - Despite challenges, new pool construction sales have outperformed industry permit data, indicating share expansion [7] - The company expects full-year sales performance to be relatively flat to slightly up, with diluted EPS guidance confirmed at $10.81-$11.31 [15][27] Other Important Information - The company completed one acquisition during the quarter, adding two locations in key markets [15] - Inventory levels increased by 4% to $1.2 billion, attributed to product inflation and stocking for new locations [24] - Cash flows from operations year-to-date totaled $286 million, down from $487 million in the prior year due to higher tax payments and working capital investments [24] Q&A Session Summary Question: Early signs of stabilization in housing and consumer trends - Management noted that permit data is sporadic, but overall activity levels seem to have firmed up, with positive comments from builder and remodel customers [32] Question: Investments in innovation and technology - Management emphasized that technology investments are aimed at enhancing customer experience and productivity, with a focus on the POOL360 platform [34][39] Question: Customer risk and margin implications - Management acknowledged consolidation at the customer level but sees it as an opportunity to leverage their technology suite for better integration and efficiency [47] Question: Chemical sales weakness and inflation - Management clarified that there has been some deflation in the sanitizer category, but overall chemical sales remain stable [55][56] Question: Pricing expectations for the next year - Management indicated that pricing increases are expected to be in line with historical trends, with innovation helping to mitigate customer fatigue regarding price hikes [90][92] Question: Adoption rates for POOL360 - Management expressed confidence in the growth potential for POOL360 adoption, aiming for a target of 25% to 30% in the coming years [94][96]

Financial Data and Key Metrics Changes - The company reported net sales of $1.5 billion for Q3 2025, reflecting a 1% increase year-over-year, with gross margin expanding by 50 basis points to 29.6% [4][24] - Diluted earnings per share (EPS) increased by 4% to $3.40 from $3.27 in the same quarter last year [27] - Operating income improved by $2 million year-over-year, totaling $178 million for the quarter [26] Business Line Data and Key Metrics Changes - Maintenance product sales performed well, particularly in parts and private label chemical volumes [7] - Building materials sales increased by 4%, driven by private label offerings and improved customer experience [12] - Equipment sales, excluding cleaners, also rose by 4%, primarily due to price benefits and steady replacement volume [13] Market Data and Key Metrics Changes - Florida experienced 1% growth, while Texas remained flat, and California and Arizona saw declines of 3% each [8] - In Europe, net sales decreased by 1% in local currency but increased by 6% in U.S. dollars [10] - The company noted that permit data was down mid-single digits year-over-year, indicating variability across different regions [6] Company Strategy and Development Direction - The company is focused on innovation and investment in its POOL360 applications, which are gaining adoption among customers [5] - A strategic roadmap for the next year was shared with the management team, emphasizing innovative products and growth plans [5] - The company aims to leverage its technology suite to enhance customer experience and drive future growth [16][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the team's ability to adapt to macroeconomic challenges, including elevated borrowing rates and consumer sentiment [6][20] - The outlook for 2025 remains cautious, with expectations for full-year sales performance to be relatively flat to slightly up [19] - Management highlighted the importance of further interest rate cuts to stimulate demand for new pool construction [6] Other Important Information - The company completed one acquisition during the quarter, adding two locations in key markets, and opened one greenfield site, bringing the total to six new sales centers year-to-date [17][18] - The company confirmed its diluted EPS guidance for the year to a range of $10.81 to $11.31, reflecting $0.11 in realized ASU benefits year-to-date [19][31] Q&A Session Summary Question: What is driving the early signs of stabilization in the market? - Management noted that permit data is sporadic but overall activity levels seem to have firmed up, with positive comments from builder and remodel customers [36] Question: Can you elaborate on the investments in innovation and technology? - Management emphasized that investments in technology are aimed at enhancing customer experience and productivity, with tools like POOL360 being central to this strategy [39][40] Question: How does customer consolidation impact margins and what levers are available? - Management indicated that customer consolidation presents an opportunity to leverage their technology suite, which can help larger customers operate more efficiently [50] Question: What is the outlook for chemical pricing and deflation? - Management acknowledged slight deflation in the sanitizer category but stated that overall chemical sales remain stable, with no alarming trends [56][58] Question: What are the expectations for sales and EPS in the fourth quarter? - Management expects fourth-quarter sales to be flat to slightly up, with weather conditions playing a significant role in construction and remodel activities [79][82]

Core Insights - Pool Corporation reported a 1% increase in net sales for Q3 2025, reaching $1.5 billion, driven by sustained customer demand for maintenance products and improved sales in building materials [3][10] - Gross profit grew by $12.8 million, with gross margin increasing by 50 basis points to 29.6% compared to the same period in 2024, benefiting from price increases and supply chain management [4][10] - The company confirmed its annual earnings guidance range of $10.81 to $11.31 per diluted share, including a year-to-date tax benefit from ASU 2016-09 of $0.11 [10][14] Financial Performance - Net income for Q3 2025 increased to $127.0 million from $125.7 million in Q3 2024 [6] - Earnings per diluted share rose by 4% to $3.40 in Q3 2025, compared to $3.27 in the same period of 2024 [7][10] - For the nine months ended September 30, 2025, net sales remained flat at $4.3 billion compared to the same period in 2024, with a slight decrease in gross margin from 29.7% to 29.6% [8][9] Operating Expenses - Selling and administrative expenses increased by 5% compared to Q3 2024, attributed to higher employee-related costs and inflationary pressures [5] - Operating income for Q3 2025 increased by $1.6 million, maintaining an operating margin of 12.3% [5][10] Balance Sheet and Liquidity - As of September 30, 2025, total assets increased by 4% to $3.5 billion, with inventory rising by 4% to $1.2 billion [12][23] - Total debt outstanding increased by $138.2 million to $1.1 billion, primarily due to share repurchases [12] - Net cash provided by operations decreased to $285.7 million for the first nine months of 2025, down from $488.6 million in the same period of 2024 [13] Strategic Developments - The company opened four new locations in Q3 2025, enhancing its industry-leading position and customer experience through expanded private-label offerings [2] - Pool Corporation celebrated its 30th anniversary as a public company, highlighting its long-term strategic focus and commitment to customer value [2]

Financial Data and Key Metrics Changes - Net sales increased by 5% to approximately $300 million, driven by a 5% increase in net price realization, a 2% decrease in volume, and a 2% contribution from the Core King acquisition [7][18] - Gross profit margins reached a record 52.7%, with adjusted EBITDA margin increasing to 29.5%, marking the tenth consecutive quarter of year-over-year gross margin expansion [6][11] - Net leverage was significantly reduced to 2.1 times, the lowest level in over three years, providing enhanced financial flexibility [6][23] Business Line Data and Key Metrics Changes - North American net sales increased by 6% to $255 million, driven by a 6% net price realization and a 3% contribution from the Clor King acquisition [20] - In Europe and Rest of World, net sales increased by 3% to $44 million, with a 1% contribution from favorable net pricing and a 3% favorable foreign currency translation [22] Market Data and Key Metrics Changes - End demand improved in June, resulting in customer orders generally aligning with normal seasonal patterns for the quarter [8] - Nondiscretionary aftermarket maintenance demand remained resilient, while discretionary elements of the market faced pressure [8][27] Company Strategy and Development Direction - The company is focused on mitigating tariff impacts while supporting margins and fulfilling commitments to shareholders and customers [6][12] - Investments are being made in advanced engineering and new product development to drive future growth, particularly in high-growth regions [11][25] - The company aims to increase its presence in the commercial pool business, which has seen significant growth post-acquisition of Clor King [10][87] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the dynamic environment and refined guidance for full-year 2025, expecting net sales to increase approximately 2% to 5% [7][26] - The company anticipates solid cash flow generation in 2025, with a conversion of greater than 100% of net income [27] Other Important Information - The company has authorized a share repurchase of up to $450 million over three years [25][94] - The tariff environment remains uncertain, with an estimated total annualized tariff impact of approximately $30 million [13][14] Q&A Session Summary Question: Outlook for gross margin in the second half - Management highlighted that the strong Q2 gross margin performance was driven by productivity improvements and product line rationalization, with expectations for continued margin protection despite potential percentage moderation [34][37] Question: New pool market outlook - Management expects modestly down pool data for the year but sees potential for improvement as interest rates and the housing market stabilize [39][42] Question: Guidance adjustments and volume outlook - The company adjusted its volume outlook to reflect stronger performance, with expectations for a negative 1% overall on volume [46][48] Question: SG&A increase and future expectations - The increase in SG&A is attributed to targeted investments in engineering and customer care, with a goal to leverage SG&A as a percentage of sales in the medium term [56][57] Question: Trends in sell-in versus sell-through - Management noted that Q2 saw a strong sell-through, with healthy order profiles and expectations for normal inventory levels as the season progresses [63][65] Question: Repair versus replace dynamics - There is a noticeable trend towards repairing equipment rather than replacing it, driven by economic pressures [66][68] Question: M&A pipeline and opportunities - The company has a healthy pipeline of M&A opportunities, focusing on both domestic and international bolt-on acquisitions [88][90]

Financial Data and Key Metrics Changes - The company reported net sales of $1.8 billion for the second quarter, reflecting a 1% increase year-over-year, indicating solid execution in strategic areas despite macroeconomic challenges [7][19][27] - Gross margin remained stable at 30%, consistent with the same period last year, showcasing effective management in a challenging environment [16][24] - Diluted earnings per share increased to $5.17, up 4% from $4.99 in the second quarter of the previous year [26] Business Line Data and Key Metrics Changes - Maintenance products showed strong performance, particularly in private label chemical products, contributing positively to sales [7][13] - Sales related to new construction and renovation activities improved during the quarter, creating less drag on overall sales compared to previous quarters [8][10] - Equipment sales, including cleaners, increased by 1%, reflecting stable replacement volumes despite a decrease in new construction units [14] Market Data and Key Metrics Changes - Florida and Arizona experienced solid sales growth of 2%, driven by population growth and favorable weather, outperforming national averages [9][10] - Texas and California faced challenges with new pool construction, with sales down 23%, attributed to macroeconomic headwinds and reduced consumer confidence [10][11] - European net sales increased by 2% in local currency and 7% in U.S. dollars, with growth particularly noted in southern European countries [11][12] Company Strategy and Development Direction - The company continues to focus on digital innovation, with the POOL360 platform transactions now representing 17% of net sales, indicating strong customer adoption [17] - Strategic openings in markets with higher pool densities are aimed at expanding market share and enhancing long-term success [18] - The company anticipates modest sales growth in the second half of the year, with full-year performance expected to be relatively flat [19][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals of the industry, supported by demographic trends and the desirability of at-home leisure [19][32] - The company remains cautious about new pool construction due to macroeconomic conditions and the absence of interest rate cuts, which are critical for housing turnover [52][62] - Management highlighted the resilience of the maintenance and repair business, which continues to perform well despite economic uncertainties [37][52] Other Important Information - The company opened two new locations during the quarter, contributing to its growth strategy [18][29] - Inventory levels increased by 3% year-over-year, reflecting new product offerings and supply chain actions [27][28] - Share repurchases totaled $104 million during the quarter, indicating a commitment to returning value to shareholders [29] Q&A Session Summary Question: Full year outlook considering tariffs and pricing dynamics - Management noted that the maintenance and repair business remains resilient, and larger renovation projects are being phased to make them more manageable for consumers [38][39] Question: Impact of interest rates on new pool construction - Management indicated that without interest rate cuts, new pool construction is unlikely to rebound significantly this year, affecting overall demand [52][62] Question: Gross margin outlook and competitive pricing - Management confirmed that competitive activity has normalized, and gross margins are expected to remain stable despite some pricing pressures [54][56] Question: Inventory management and product shortages - Management reassured that inventory levels are well-managed and there are no significant product shortages affecting operations [87][82] Question: Chemical pricing dynamics - Management acknowledged ongoing pricing pressures in chemicals but noted that the competitive landscape has not worsened significantly [95][96]

Group 1 - Pool Corp. holds a dominant market share in a fragmented and growing market, providing a strong investment case [2] - Approximately two-thirds of Pool Corp.'s sales are derived from the maintenance and repair of existing swimming pools, including chemicals and equipment [4] - The company exhibits relatively high profit margins and consistently high return on invested capital (ROIC), indicating effective investment strategies [5] Group 2 - Pool Corp.'s margins and ROIC experienced a decline in 2022 due to a correction following the pandemic-induced spending boom [7] - Despite a slowdown in new pool construction, the growing installed base of pools is expected to drive revenue from maintenance and repair services [8] - The company is anticipated to return to its long-term growth trajectory once the new pool construction market stabilizes [8]

Financial Data and Key Metrics Changes - The company reported net sales of $1.1 billion for the first quarter, a decrease of 4% year-over-year, but a decline of only 2% on a same selling day basis, indicating an improving trend towards the end of the quarter [13][14] - Gross margins were reported at 29.2%, down from 30.2% in the first quarter of 2024, but reflecting year-over-year improvement when adjusted for a prior year tax benefit [15][39] - Operating income decreased to $77.5 million, with diluted earnings per share at $1.42, down from $2.04 in the prior year [18][43] Business Line Data and Key Metrics Changes - Maintenance product sales performed well, with chemicals showing volume and revenue growth, including double-digit growth in private label chemical products [14][36] - New construction and remodel activities continued to be affected by tight discretionary spending, but the drag on top-line sales was less severe than in previous quarters [14][37] - Equipment sales, excluding cleaners, declined by 4% during the quarter, while commercial business sales increased by 7% [25][26] Market Data and Key Metrics Changes - Sales increased by 2% in Arizona, remained flat in California, declined by 1% in Florida, and decreased by 11% in Texas, with challenging weather impacting sales in Texas and Florida [19][20] - In Europe, net sales declined by 4% in local currency and 6% in US dollars, with positive trends noted in Spain and Portugal [20][21] - Horizon's net sales also declined by 4%, impacted by commodity pricing deflation, particularly in PVC [22] Company Strategy and Development Direction - The company aims to achieve above-market growth through strategic initiatives focused on customer experience, private label products, and expanding its footprint [6][31] - The company is expanding its wholesale distribution network, having opened two new locations in the first quarter, bringing the total to nearly 450 [28] - The Pinch A Penny franchise network is expanding, with new stores opening to capture the do-it-yourself market [29] Management's Comments on Operating Environment and Future Outlook - Management noted that the macroeconomic environment continues to weigh on new pool construction, with high interest rates causing a wait-and-see pattern in demand for large discretionary purchases [7][52] - There is cautious optimism regarding improving trends in sales, particularly in Florida and California, with expectations for some growth in new pool construction in the second half of the year [69][70] - The company confirmed its full-year EPS guidance range of $11.10 to $11.60, including an estimated benefit from ASU [30][60] Other Important Information - The company has a strong balance sheet, with total debt reported at $1 billion and a leverage ratio of 1.47, at the lower end of its target [47] - Cash flow from operating activities was reported at $27 million, with significant cash outflows related to inventory purchases and deferred tax payments [48] - The company plans to continue share repurchases, having completed $56 million in repurchases during the quarter [49] Q&A Session Summary Question: Expectations for second quarter top line growth - Management expects low single-digit top line growth in the second quarter, consistent with full-year guidance [64][65] Question: Price expectations for the second quarter - Price increases are expected to be more pronounced in the second half of the year, with some impact in the second quarter [66][67] Question: New pool ASP and remodel expectations - The higher-end consumer market remains strong, with no significant trade-downs observed, although remodel projects are being spaced out over time [80][82][85] Question: Impact of macroeconomic conditions on margins - If macro conditions worsen, discretionary spending on new pool construction will be most affected, but maintenance and repair business remains strong [109][110] Question: Positioning of Pinch A Penny in a softening market - No significant shift to DIY from do-it-for-me has been observed, with both channels performing well [114][116] Question: Competitive pricing environment - Competitive pricing remains a challenge, but the company focuses on long-term value and customer experience rather than unsustainable pricing wars [122][125]