Vestis
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Vestis (VSTS) investor relations material

Vestis Q1 2026 earnings summary

Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.
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Q1 2026 earnings summary10 Feb, 2026

Executive summary

  • Q1 2026 revenue was $663.4 million, down 3% year-over-year, with a net loss of $6.4 million and adjusted EBITDA of $70.4 million (10.6% margin), reflecting sequential improvement and the launch of a strategic transformation plan targeting $75 million in annual cost savings by year-end 2026.

  • Operational improvements included a 7% increase in plant productivity, a 3% rise in on-time deliveries, and a 12% reduction in customer complaints year-over-year.

  • Commercial initiatives advanced decision support tools, strategic pricing, and local customer engagement, with new Market Development Representatives introduced.

  • Asset optimization included marketing non-core properties for sale, with proceeds intended for debt repayment.

  • No dividends were paid, and restrictions on dividends and share repurchases remain until leverage targets are met.

Financial highlights

  • Revenue declined by $20.4 million year-over-year, with rental revenue down $17.9 million and direct sales down $2.7 million; adjusted EBITDA margin was 10.6%, down from 11.9% in Q1 2025 but up 150 bps sequentially.

  • Net loss was $6.4 million compared to net income of $0.8 million in Q1 2025; adjusted EPS was $0.10 per diluted share.

  • Cost per pound improved by $0.02 year-over-year, equating to $10 million in adjusted EBITDA savings.

  • Free cash flow was $28.3 million, with $12.7 million benefit from working capital improvements; adjusted free cash flow excluding transformation costs was $42.9 million.

  • Net debt at quarter-end was $1.29 billion, with $316.7 million in available liquidity and no maturities until 2028.

Outlook and guidance

  • Fiscal 2026 revenue is expected to be flat to down 2% versus 2025, with adjusted EBITDA guidance reaffirmed at $285–$315 million and free cash flow guidance at $50–$60 million.

  • Sequential quarterly adjusted EBITDA improvements of about 5% are anticipated starting Q2.

  • Effective tax rate for 2026 projected at 25–30%.

Explain Q1 revenue decline despite flat volume
Quantify Q1 transformation cash payments
Update on non-core asset sales for debt repayment
Commercial actions to improve revenue quality?
Connect plant productivity to operating leverage
Drivers of remaining FY26 EBITDA improvement?
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Frequently asked questions

Vestis Corporation is a provider of uniform rentals and workplace supplies, serving a wide array of customers across the United States and Canada. With over 75 years of experience in the industry, Vestis caters to more than 300,000 customer locations, ranging from Fortune 500 companies to locally owned small businesses. The company's service offerings are comprehensive, including a full-service uniform rental program, workplace supplies like towels and aprons, floor care products such as mats, linen services, managed restroom supply services, first aid and safety products, and cleanroom and other specialty garment processing. Vestis operates within an estimated $48 billion industry, engaging in sectors such as manufacturing, hospitality, retail, food processing, pharmaceuticals, healthcare, and automotive, providing services that help its customers reduce operating costs, enhance brand image, and maintain a safe and clean workplace. The company is headquartered in Roswell, Georgia, and its shares are listed on the NYSE.

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