PoolCorp (POOL) investor relations material

Financial performance and guidance

• Q1 2026 net sales grew 6%, with operating income up 7% and a 10 basis point margin expansion, exceeding expectations.

• Full-year diluted EPS guidance reaffirmed at $10.87-$11.17, reflecting 2%-3% growth over prior year.

• Gross margin for Q1 was 29%, down 20 basis points year-over-year, mainly due to product mix and increased early buy activity.

• Inventory rose 14% year-over-year to $1.7 billion, supporting new locations, product introductions, and seasonal demand.

• Interest expense projected at $49-$51 million for the year, with a tax rate of approximately 25%.

Strategic priorities and business developments

• Focus remains on leveraging existing investments in network, technology, and people, with measured expansion of five new sales centers planned for 2026.

• Digital platform Pool360 reached 13% of Q1 net sales, with ongoing enhancements and a long-term penetration target above 25%.

• Private label and proprietary products, especially in chemicals, are gaining traction and contributing to higher margins.

• Early buy programs and supply chain actions are positioning the company well for the peak season.

• Capital allocation remains disciplined, with $64 million in share repurchases during Q1 and $271 million remaining under authorization.

Market trends and operational outlook

• Maintenance and remodel activity in the 5.5 million installed pool base is the primary growth driver, not new pool construction.

• Geographic performance varied: California and Texas saw strong growth, while Florida was slightly down due to weather and irrigation softness.

• Equipment sales grew 7% in Q1, driven by both price and volume, though this diluted gross margin due to lower relative margins.

• Expense growth is expected to moderate through 2026 as new sales centers mature and capacity is absorbed.

• No significant changes in consumer demand or pricing environment anticipated; chemical prices and discretionary demand remain stable.