Dorman Products (DORM) investor relations material

Executive summary

• Net sales reached $541M in Q2 2025, up 7.6%-8% year-over-year, driven by strong Light Duty demand and new product launches.

• Adjusted diluted EPS rose 23% to $2.06, and adjusted operating margin improved to 16.3%, up 70 basis points from last year.

• Operating cash flow was $9M, impacted by higher tariffs and increased inventory investment.

• Heavy Duty segment saw slight growth despite market pressures; Specialty Vehicle sales declined 3% due to weak consumer sentiment.

• Cost savings from supply chain, productivity, and automation initiatives contributed to margin expansion.

Financial highlights

• Net sales grew 7.6%-8% year-over-year to $541M in Q2 2025.

• Adjusted gross margin reached 40.6%, a 100 basis point increase from last year.

• Adjusted operating income was $88M, up 12% year-over-year; adjusted operating margin improved to 16.3%.

• Adjusted diluted EPS was $2.06, a 23% increase year-over-year.

• Operating cash flow dropped to $9M from $63M in Q2 2024 due to tariff-related inventory investments.

Outlook and guidance

• Net sales growth for 2025 now expected in the 7%-9% range, up from prior 3%-5% guidance.

• Adjusted diluted EPS guidance raised to $8.60-$8.90; diluted EPS guidance to $8.05-$8.35.

• Tariff-related price increases to take effect in Q3, expected to boost Q3 margins before higher costs impact Q4.

• Guidance based on current tariffs and excludes impacts from future major events.

• Guidance assumes a 24% effective tax rate.