Fortune Brands Innovations (FBIN) investor relations material

Executive summary

• Leadership transition underway with interim CEO and CFO appointed, and a comprehensive CEO search in progress; board refresh includes new director and planned retirements.

• Q1 2026 net sales were $1,011.3 million, down 2.1% year-over-year due to lower sales volume across all segments, primarily from demand softness and declines in China.

• Net income for Q1 2026 was $24.2 million, down 53% year-over-year, impacted by $42.4 million in governance advisory and leadership change costs.

• Strategic focus on operational rigor, cost optimization, and prioritizing high-return investments to drive sales growth and margin improvement.

• Emphasis on leveraging strong brands and talent, with new campaigns and product launches in key segments.

Financial highlights

• Q1 2026 net sales were $1,011.3 million, down 2.1% year-over-year; excluding China, sales declined 1.2%.

• Operating income before charges/gains was $112.1 million, down 17.5%; reported operating income was $60.2 million, down 37.9%.

• EPS before charges/gains was $0.53, down 19.7%; reported EPS was $0.20, down 52%.

• Free cash flow for Q1 2026 was negative $139.5 million, reflecting typical seasonality.

• Net debt at quarter-end was $2.5 billion, with net debt to EBITDA at 2.9x.

Outlook and guidance

• Full-year 2026 net sales expected to be down low single digits or flat to up 2%; EPS before charges/gains guidance set at $3.00–$3.30.

• Operating margin before charges/gains expected at 13.5%–14.5%.

• Free cash flow guidance for 2026 is $350–$400 million.

• Second half margins expected to be up ~300 bps versus first half, with EPS more weighted to the second half.

• Guidance reflects persistent tariff environment, commodity/freight inflation, and cautious consumer sentiment.