Latham Group (SWIM) Q1 2026 earnings summary

Executive summary

• Achieved year-over-year sales growth across all product lines, with positive trends continuing into April despite adverse weather in North America.

• Double-digit sales growth in Florida, driven by new dealer sign-ups and targeted marketing, with continued execution of the Sand State strategy.

• Integration of Freedom Pools acquisition expanded presence in Australia and New Zealand, contributing to sales growth and expected to add $20 million in annual net sales and $4 million in adjusted EBITDA before synergies.

• Achieved #1 market share in every subcategory served, with a balanced portfolio across liners, covers, and in-ground pools.

• Leadership transition with Sean Gadd appointed CEO in January 2026.

Financial highlights

• Net sales for Q1 2026 were $117.3 million, up 5.3% from $111.4 million in Q1 2025.

• Adjusted EBITDA rose 9.2% to $12.2 million, with margin improving to 10.4% from 10.0% year-over-year.

• Gross margin expanded to 32% (31.7% in some reports), up 220 basis points year-over-year, driven by volume leverage and production efficiencies.

• SG&A expenses rose to $37 million (+20%), reflecting investments in sales, marketing, digital transformation, and acquisition costs.

• Net loss was $8.5 million (7.3% margin), up from $6.0 million (5.4% margin) last year, mainly due to higher SG&A and integration costs.

Outlook and guidance

• Reaffirmed full-year 2026 guidance: net sales growth of 9% and adjusted EBITDA growth of 12.7% at the midpoint, with net sales guidance of $580–$610 million and adjusted EBITDA of $105–$120 million.

• U.S. in-ground pool market expected to remain flat versus 2025.

• Capital expenditures projected at $42–$48 million for 2026, including facility upgrades and maintenance.

• Sufficient liquidity anticipated for the next 12 months, with ongoing investments in digital transformation and production capacity.

• Monitoring geopolitical and commodity cost risks, but confident in ability to manage through the season.