GPGI Inc (GPGI) Q1 2026 earnings summary

Executive summary

• CompoSecure achieved record sales and margin expansion, driven by robust demand from banks and fintechs and the deployment of the Resolute Operating System (ROS), while Husky faced significant market-driven weakness due to oil/resin price shocks, tariffs, and geopolitical disruptions, leading to order delays and reduced new orders.

• Leadership changes and targeted cost actions are underway at Husky to address near-term challenges, while both businesses accelerate ROS implementation for operational transformation and foundational growth.

• Full-year 2026 guidance was revised downward, reflecting ongoing strength at CompoSecure but caution for Husky amid persistent market headwinds.

• Completed the acquisition of Husky Technologies Limited for $4.98 billion, expanding into injection molding equipment and services markets.

Financial highlights

• Pro forma adjusted net sales for Q1 2026 were $421.2 million, up 3% year-over-year; adjusted EBITDA was $82.1 million, down 16% year-over-year, with margins at 19.5%, down 430 basis points.

• CompoSecure delivered record net sales of $130.4 million, up 26% year-over-year, and adjusted EBITDA of $47.6 million, up 37%, with margins expanding 300 basis points to 36.5%.

• Husky reported net sales of $290.8 million, down 5% year-over-year, and adjusted EBITDA of $38.2 million, down 40%, with margins eroding by 770 basis points to 13.2%.

• Net loss attributable to GPGI, Inc. was $235.0 million for Q1 2026, compared to net income of $21.5 million in Q1 2025.

• Adjusted EPS (diluted) for Q1 2026: $0.12, down from $0.25 in Q1 2025.

Outlook and guidance

• FY 2026 guidance: net sales $1.95B–$2.1B, adjusted EBITDA $550M–$610M, margins 28.2%–29%, and free cash flow $275M–$325M.

• Q2 2026 guidance: net sales $425M–$475M, adjusted EBITDA $105M–$120M, margins 24.7%–25.3%.

• Guidance reflects uncertainty from ongoing geopolitical conflicts, customer order delays, and macroeconomic ambiguity, with recovery dependent on resolution of these factors.

• CompoSecure projected to grow at a low double-digit rate, while Husky is expected to decline mid-single digits due to macro disruptions.

• Management expects continued integration of Husky and focus on deleveraging the balance sheet.