Latham Group (SWIM) Q2 2026 earnings summary

Executive summary

• Net sales increased 14.4% year-over-year to $197.5 million in Q2 2026, driven by 10.3% organic growth and the Freedom Pools acquisition, with strong momentum in the Sand States and in-ground pool segment.

• Adjusted EBITDA rose 11.9% to $44.6 million, with margin at 22.6%, and gross profit increased 9.6% to $70.1 million despite a gross margin dip to 35.5% due to ramp-up costs.

• Net income for Q2 was $12.8 million (6.5% margin), down from $16.0 million (9.3% margin) a year ago, impacted by foreign currency losses and margin pressures.

• Full-year 2026 guidance was raised to 11.7% net sales growth and 15.2% adjusted EBITDA growth at the midpoints, with CapEx guidance revised to $40–$45 million.

• Strategic priorities include expanding in core markets, driving fiberglass conversion, increasing auto cover attachment, and pursuing accretive acquisitions.

Financial highlights

• Q2 2026 net sales: $197.5 million (up 14.4% year-over-year); in-ground pool sales up 22.5%, covers up 10%, liners up 6%.

• Q2 adjusted EBITDA: $44.6 million (22.6% margin); gross profit: $70.1 million (35.5% margin); net income: $12.8 million.

• Six-month net sales: $314.8 million; six-month net income: $4.2 million.

• Net debt at quarter-end: $236.3 million; cash: $43.5 million; total debt: $279.8 million.

• Net debt leverage ratio: 2.2x; effective tax rate: 32.4% for the quarter.

Outlook and guidance

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

• CapEx guidance revised to $40–$45 million; majority of ramp-up costs expected to be recovered in H2.

• Guidance reflects higher volumes, share gains, and operating leverage recapture; U.S. pool starts expected to remain flat.

• Management expects continued outperformance of market trends and substantial growth opportunities.

• Mitigation strategies in place for transportation and commodity cost headwinds.