Financial Data and Key Metrics Changes - Net sales for Q4 were $389.2 million, a 2.2% decline from $397.9 million in the same quarter last year [26] - Same-store sales decreased by 6.8% on a 13-week basis compared to the same period in fiscal year 2024 [27] - Adjusted EBITDA for Q4 increased to $45.2 million from $43 million in Q4 2024 [31] - Net loss for Q4 was $162.8 million, or $17.54 per diluted share, compared to a net loss of $9.9 million, or $1.07 per diluted share in the prior year [30] - Full year 2025 sales were approximately $1.24 billion, down from $1.33 billion in 2024 [32] Business Line Data and Key Metrics Changes - Chemicals category sales were down approximately 7.1%, and equipment category sales were down 7.6% on a 13-week comparable basis [27] - The company experienced a net loss of over 160,000 residential customers, with a decline in residential traffic of 8.6% in 2025 [6][10] Market Data and Key Metrics Changes - The company noted a significant price-value challenge leading to market share loss [5] - The competitive pricing environment in Q4 was influenced by excess supply and aggressive pricing from competitors [80] Company Strategy and Development Direction - The company is focusing on cost optimization, cash and capital management, and improving the price-value equation [4][6] - Plans to close 80 to 90 underperforming stores, which will impact annual sales by approximately $25 million to $35 million but improve net EBITDA by $4 million to $10 million [17][34] - The company aims to enhance its customer value proposition through targeted marketing and improved pricing strategies [8][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging macroeconomic environment and its impact on consumer spending [38] - The company expects to generate the majority of its sales and earnings in the second half of the year due to the seasonal nature of the industry [38] - For fiscal 2026, the company anticipates sales between $1.1 billion and $1.25 billion and adjusted EBITDA of $55 million to $75 million [39] Other Important Information - The company is implementing a comprehensive expense reduction initiative and renegotiating contracts with vendors and suppliers [35] - Inventory levels were reduced by $26 million year-over-year, with a focus on improving in-stock percentages on core SKUs [29][32] Q&A Session Summary Question: Are supplier partners supporting the turnaround efforts? - Management confirmed that vendor partners have been supportive, allowing for better inventory forecasts and improved in-stock positions [49][51] Question: How much of the EBITDA guide is expected to convert into free cash flow? - The midpoint of the EBITDA guide assumes free cash flow positivity for the year [53] Question: Where do you see the most opportunity in pricing? - The focus is on key value items, particularly in the chemicals category, with a strategy to remain competitive against specialty and big box retailers [60][61] Question: What is the impact of store closures on revenue? - The closures are expected to have a $25 million to $35 million impact on revenue, but the majority of the stores being closed were unprofitable [70][72] Question: What is the plan to regain lost customers? - The company plans to target lost customers with customized marketing efforts based on their previous purchasing behavior [74][76] Question: Can you comment on competitive dynamics in Q4? - Management noted aggressive pricing in the marketplace and the need to remain competitive, which has led to sequential improvements in performance [80]

Financial Data and Key Metrics Changes - Net sales for Q4 were $389.2 million, a decline of 2.2% from $397.9 million in the same quarter last year [26] - Same-store sales decreased by 6.8% on a 13-week basis compared to the same period in fiscal year 2024 [27] - Gross margin for Q4 increased to 38.6% from 36% in the prior year, driven by favorable vendor rebates and freight costs [29] - Net loss for Q4 was $162.8 million, or $17.54 per diluted share, compared to a net loss of $9.9 million, or $1.07 per diluted share in the same quarter last year [30] - Adjusted EBITDA for Q4 increased to $45.2 million from $43 million in Q4 2024 [31] - Full year 2025 sales were approximately $1.24 billion, down from $1.33 billion in 2024 [31] Business Line Data and Key Metrics Changes - Chemicals sales were down approximately 7.1%, and equipment sales were down 7.6% on a 13-week comparable basis [27] - The company experienced a net loss of over 160,000 residential customers, with a decline in residential traffic of 8.6% in 2025 [6][10] Market Data and Key Metrics Changes - The company noted a competitive pricing environment in Q4, which affected sales performance [80] - The company is focusing on improving its price-value perception to regain market share lost due to pricing challenges [6][10] Company Strategy and Development Direction - The company is implementing immediate actions to improve operations and accelerate financial profitability, including closing 80-90 underperforming stores [7][17] - A restructuring of field teams is underway to enhance customer relationships and drive growth [11] - The company is focusing on a customer-centric approach, enhancing its value proposition through targeted marketing and pricing strategies [12][44] - Plans to optimize inventory and reduce SKU counts by over 2,000 are in place to improve operational efficiency [20][37] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging macroeconomic environment and its impact on consumer spending, but expressed confidence in the company's strategic direction [38] - The company expects to generate the majority of its sales and earnings in the second half of the year, consistent with the seasonal nature of the industry [39] - Guidance for fiscal 2026 includes expected sales of $1.1 billion to $1.25 billion and adjusted EBITDA of $55 million to $75 million [39] Other Important Information - The company ended the fiscal year with no outstanding borrowings on its line of credit and $752 million of net long-term debt [32] - A $184 million impairment charge was recorded in Q4, primarily related to goodwill and the closure of underperforming stores [30] Q&A Session Summary Question: Are supplier partners supporting the turnaround efforts? - Management confirmed that vendor partners have been supportive, allowing for better inventory forecasts and improved in-stock positions [49][51] Question: What is the expected free cash flow conversion for this year? - The midpoint of the guidance assumes free cash flow positivity for the year [52] Question: Where do the most pricing opportunities lie? - The focus is on key value items, particularly in the chemicals category, with a strategy to remain competitive against other retailers [60] Question: What is the impact of store closures on revenue? - The closures are expected to impact annual sales by approximately $25-$35 million, but the majority of the stores being closed were unprofitable [70][72] Question: How does the company plan to regain lost customers? - Targeted marketing efforts will be employed to reach former customers, leveraging data from the Pool Perks Loyalty Program [74][76] Question: What are the competitive dynamics observed in Q4? - Management noted aggressive pricing in the marketplace and the need to remain competitive, which has led to sequential improvements in performance [80]

Core Viewpoint - Pool Corp. is currently facing challenges due to external economic factors, leading to a significant decline in stock price, yet it remains a fundamentally strong company with potential long-term investment appeal [1][2][3]. Company Performance - Pool Corp. has experienced a 56% decline from its peak stock price, attributed to consumers struggling with affordability in housing and large projects post-pandemic [1][2]. - The company's earnings per share (EPS) have decreased from their peak, with sales growth reported at just 1% in the third quarter of the current year [7]. Dividend Yield - The stock's dividend yield is currently nearly 2%, the highest it has been in over a decade, indicating a potential value opportunity for investors [6]. - Pool Corp. has a strong history of dividend payments, having raised its dividend for 14 consecutive years, which reflects its commitment to returning value to shareholders [5][6]. Financial Resilience - Despite the economic challenges, Pool Corp. has substantial recurring revenue streams and a modest dividend payout ratio, positioning it well to navigate current adversities [9]. - The company has a long-standing track record, suggesting that it may be a worthwhile investment while its stock price is down [9].

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 [9] - Gross margin remained stable at 30%, consistent with the same period last year [18] - Operating income improved to $273 million compared to $271 million in the prior year [26] - Diluted earnings per share increased by 4% to $5.17 from $4.99 in the second quarter of the previous year [27] Business Line Data and Key Metrics Changes - Maintenance products showed strong performance, particularly in private label chemical products, contributing to overall sales growth [9] - Sales related to new construction and renovation activities improved, creating less drag on sales than in previous quarters [10] - Chemical sales grew by 1%, despite price deflation and weather challenges [14] - Equipment sales, including cleaners, increased by 1%, reflecting stable replacement volumes [15] Market Data and Key Metrics Changes - Florida and Arizona experienced solid sales growth of 2%, outperforming national averages due to population growth and favorable weather [11] - Texas and California faced challenges with new pool construction, with sales down 23% in both states [11] - European net sales increased by 2% in local currency and 7% in U.S. dollars, with growth particularly in southern countries [12][13] Company Strategy and Development Direction - The company is focused on maintaining its leadership position through strategic investments in digital innovation and expanding its footprint with new locations [19] - The strategy includes enhancing customer experience and expanding private label offerings to capture market share [20] - The company anticipates modest sales growth in the second half of the year, with a full-year performance expected to be relatively flat [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals of the industry, driven by demographic trends and the desirability of at-home leisure [20] - The company remains cautious about new pool construction due to macroeconomic headwinds and lack of interest rate cuts [52] - Management noted that while maintenance and repair business remains resilient, larger renovation projects are being phased to manage consumer spending [38] Other Important Information - The company opened two new locations during the quarter, contributing to its growth strategy [19] - Inventory levels increased by 3% year-over-year, reflecting new product offerings and seasonal stocking [27] - The company completed $104 million in share repurchases during the quarter, exceeding prior year repurchases [29] Q&A Session Summary Question: How should the company think about the full year given the dynamics with tariffs and pricing? - Management highlighted the resilience of the maintenance and repair business and noted that larger renovation projects are being broken into phases to manage costs [38] Question: Why was the EPS guidance lowered for the year? - The adjustment was due to the lack of anticipated interest rate cuts, which are crucial for stimulating new pool construction [52] Question: Are there any inventory benefits to margins in the second quarter? - Management indicated that supply chain improvements and price increases contributed positively to margins, with expectations for continued benefits in the second half [68] Question: What is the outlook for new construction and discretionary spending? - Management expressed skepticism about significant improvements in new construction due to ongoing economic pressures, but noted strong performance in maintenance [63] Question: Is there any product shortage or labor issue affecting the company? - Management reported no significant product shortages or labor issues, indicating that supply chains are generally in good shape [81]

Core Viewpoint - Pool Corporation will release its second quarter 2025 earnings results on July 24, 2025, before market opens, followed by a conference call to discuss the results [1] Group 1: Earnings Announcement - The earnings release will be available on the Company's website [1] - A live webcast and replay of the conference call will also be accessible online [1] - The conference call is scheduled for 10:00 a.m. Central Time (11:00 a.m. Eastern Time) on the same day [1] Group 2: Company Overview - Pool Corporation is the world's largest wholesale distributor of swimming pool and related backyard products [2] - The company operates approximately 445 sales centers across North America, Europe, and Australia [2] - Pool Corporation distributes over 200,000 products to around 125,000 wholesale customers [2]