Spectrum Brands (SPB) Q1 2026 earnings summary

Executive summary

• Q1 FY26 net sales declined 3.3% year-over-year to $677.0 million, but net income from continuing operations rose 19.5% to $29.4 million, driven by a one-time tax benefit and lower share count.

• Adjusted EBITDA was $62.6 million, down 19.5% year-over-year, with margin declining to 9.2% from 11.1%.

• Global Pet Care returned to growth, with net sales up 8.3% (organic +5.8%), while Home & Garden and Home & Personal Care saw declines.

• Nearly $60 million in adjusted free cash flow was generated, and significant capital was returned to shareholders through buybacks, including a new $300 million repurchase program.

• Strategic priorities remain: maintaining a strong balance sheet, operational excellence, investing in people, and transformation through innovation, M&A, and ERP initiatives.

Financial highlights

• Q1 net sales were $677.0 million, down 3.3% year-over-year; organic net sales declined 6.0%.

• Gross profit fell to $241.6 million (35.7% margin), down 6.3% year-over-year.

• Operating income was $27.1 million, down from $44.7 million in the prior year.

• Adjusted EBITDA was $62.6 million, down from $77.8 million; adjusted diluted EPS rose to $1.40, driven by tax benefit and share reduction.

• Cash flow from operating activities improved to $67.7 million; adjusted free cash flow was $59.7 million.

Outlook and guidance

• Fiscal 2026 guidance reiterated: net sales expected to be flat to up low single digits, with low single digit adjusted EBITDA growth.

• Adjusted free cash flow conversion targeted at approximately 50% of adjusted EBITDA.

• Growth anticipated in Global Pet Care and Home & Garden, offset by a decline in Home & Personal Care.

• Q2 expected to remain challenging, with Home & Garden growth weighted to the second half.

• Long-term net leverage ratio targeted at 2.0–2.5x.