Latham Group (SWIM) investor relations material

Executive summary

• Achieved 14.4% year-over-year net sales growth in Q2 2026, with 10.3% organic growth and strong Sand States and in-ground pool performance.

• Gross profit increased 9.6% to $70.1 million, though gross margin declined by 160 basis points due to $2.8 million in ramp-up costs.

• Raised full-year 2026 net sales growth guidance midpoint to 11.7% and adjusted EBITDA growth to 15.2%.

• Strategic focus on expanding fiberglass pool market share, increasing auto cover attachment rates, and targeted geographic expansion, especially in Sand States.

• Strategic initiatives include growing the core business, accelerating material conversion, advancing the autocover business, and pursuing accretive acquisitions.

Financial highlights

• Q2 2026 net sales: $197.5 million, up from $172.6 million in Q2 2025.

• In-ground pool sales: $96 million (+23%), cover sales: $41 million (+10%), liner sales: $60 million (+6%).

• Q2 adjusted EBITDA: $44.6 million (22.6% margin), up from $39.9 million in Q2 2025.

• Q2 net income: $12.8 million ($0.11 per diluted share), down from $16.0 million ($0.13 per share) a year ago, impacted by foreign currency losses.

• SG&A expenses increased 17.8% in Q2, reflecting investments in growth, acquisitions, and digital transformation.

Outlook and guidance

• Full-year 2026 net sales guidance raised to $600–$620 million (11.7% growth midpoint, 8.4% organic), adjusted EBITDA guidance increased to $110–$120 million (15.2% growth midpoint).

• CapEx guidance revised to $40–$45 million to align with demand trends.

• Guidance reflects strong first-half demand, ongoing growth initiatives, and mitigation of cost headwinds.

• U.S. pool starts in 2026 expected to remain flat compared to 2025, but company expects to outperform market.