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- **Revenue & Profit Growth**: 7.6% net sales increase, 28.5% EBITDA rise to $38.3 million, driven by fiberglass pools (75% of sales) and Coverstar synergies.
- **Margin Expansion**: Gross margin +300bps to 35.4%, EBITDA margin +390bps to 23.7%, fueled by lean manufacturing and Measure tool efficiency.
- **Strategic Wins**: Florida sales up high single-digits, 24% fiberglass market share, and $71M cash for M&A/expansion.
- **Tariff Resilience**: $10M annual tariff mitigation via price increases and supply chain diversification.

**【CEO Summary Section】**
- **Revenue Growth**: Net sales increased 7.6% YoY to $162 million, driven by organic growth and strategic initiatives. Adjusted EBITDA rose $8.5 million (28.5%) to $38.3 million.
- **Product Line Performance**: All three product lines (in-ground pools, covers, liners) saw YoY growth. Fiberglass pools accounted for 75% of full-year 2025 in-ground sales, with 24% market share.
- **Margin Expansion**: Gross margin improved 300bps to 35.4%, EBITDA margin increased 390bps to 23.7%, due to lean manufacturing and Coverstar synergies.
- **Strategic Initiatives**: Measure Pro tool reduced quoting time by 80%, driving 13% liner sales growth. Florida sales up high single-digits, with partnerships in sand states.

**【CFO Financial Commentary】**
- **Financial Health**: Cash reserves of $71 million, net debt leverage 2.3x (targeting 2.0x by year-end). Operating cash flow $51 million Q3, $40 million YTD.
- **Guidance Update**: Narrowed 2025 net sales to $540-$550 million (7% growth), EBITDA $92-$98 million (19% growth). CapEx revised to $22-$24 million.
- **Tariff Mitigation**: Implemented June 2025 price increase covering $10 million annual tariff impact. Supply chain diversification maintained margins.

**【Q&A Highlights】**
- **Florida Market**: Dealer conversions and MPC partnerships driving high single-digit growth. Fiberglass adoption accelerating due to labor efficiency (6x faster install vs. concrete).
- **Tariff Strategy**: Dynamic mitigation via supplier diversification. Annual price increase cadence expected to resume post-tariff normalization.
- **Capital Allocation**: 2.0x leverage target; $71 million cash for M&A (e.g., Coverstar) and sand states expansion.
- **2026 Outlook**: Dealer backlogs suggest flat to +2% pool starts. Measure Go app expansion to 15,000 dealers via iPhone LiDAR.

Latham Group, Inc. (SWIM) Q3 2025 Earnings Call Transcript

- **Revenue Growth**: 7.8% YoY to $173M, driven by 46% autocover sales and 5.8% liner growth. Adjusted EBITDA up 15.7% to $39.9M.
- **Fiberglass Dominance**: 75% of in-ground pools sold; targeting 20%+ Sand State revenue share. Autocovers now 20% of new pools, with 16 states allowing safety substitution.
- **Margin Expansion**: Gross margin +400bps to 37.1%, offsetting $5.3M SG&A growth for marketing and Sand State expansion.
- **Guidance Reaffirmed**: 8% net sales growth, 19% EBITDA growth. 2025 CapEx: $27-33M for Sand State manufacturing.
- **Tariff Mitigation**: $20M headwind neutralized via supply chain; no margin impact expected.


**【CEO Summary Section】**
- Q2 2025 revenue grew 7.8% YoY to $173 million, driven by autocovers (+46%) and liners (+5.8%). Adjusted EBITDA rose 15.7% to $39.9 million.
- Fiberglass pools account for 75% of in-ground pool sales, with 1% market share gain expected in 2025. Autocovers now penetrate ~20% of new pools, with 16 states allowing them as safety substitutes.
- Sand State strategy: dealer network expanded in Florida and Texas, with 25% of Measure by Latham tool users new to Latham. Fiberglass pools in Sand States now 17% of revenue, targeting 20%+.
- Lean manufacturing initiatives improved gross margin by 400bps to 37.1%, offsetting $5.3M SG&A growth for marketing and Sand State expansion.

**【CFO Financial Commentary】**
- Q2 GAAP net income: $16M ($0.13 EPS), up 20% YoY. First-half adjusted EBITDA: $51M (+9.1%), margin 18% vs. 17.3% prior year.
- Cover sales growth from Coverstar acquisitions and Measure by Latham adoption. Liner sales benefited from 18% dealer lead increase and 34% website traffic growth.
- 2025 guidance reaffirmed: 8% net sales growth, 19% adjusted EBITDA growth. 2025 CapEx: $27-33M for Sand State manufacturing expansion.

**【Q&A Key Highlights】**
- **Marketing ROI**: DIRECTV campaign drove Florida/Texas lead spikes, with 18% dealer leads and 34% website traffic growth YTD. Fiberglass backlog stable at 2-4 weeks.
- **Weather Impact**: Q2 in-ground pools down 2.9% due to Northeast delays, but fiberglass June/July sales turned positive. Package pools remain flat due to consumer confidence.
- **Gross Margin Drivers**: 400bps improvement from Coverstar margins, lean manufacturing, and volume leverage. No one-time items; 2025 gross margin sustainability expected.
- **Tariffs**: $20M headwind offset by supply chain mitigation, neutral margin impact. 2025 outlook unchanged.
- **M&A Pipeline**: 30% of capital allocated to M&A, focusing on accretive dealer acquisitions in Sand States.


Latham Group, Inc. (SWIM) Q2 2025 Earnings Call Transcript

- **Market Share Gains**: Fiberglass pools set to gain 1% share in 2025 vs. concrete, driven by labor shortages (46% of builders cite labor constraints).
- **Autocover Growth**: 20%+ YoY revenue target for autocovers, with 15% of pool owners currently using vs. 25% target by 2030.
- **Margin Expansion**: 190bps gross margin improvement in Q1, targeting 200-250bps full year.
- **Sand State Play**: $10M+ incremental revenue by 2027 from dealer network expansion in FL/TX.
- **Safety Differentiator**: Autocovers reduce labor needs by 75% and pay for themselves in 4-5 years through savings.

**【CEO Opening Remarks】**
- Q1 2025 revenue growth in line with expectations, driven by sequential improvement in March-May business activity.
- Key highlights:
  - **Fiberglass & Autocover Strength**: 1% market share gain expected in 2025 vs. concrete pools; autocover sales outperformed due to 3 tuck-in acquisitions (Coverstar NY, TN, Central).
  - **Gross Margin Expansion**: 190bps improvement from lean manufacturing and value engineering initiatives.
  - **Sand State Strategy Progress**: 
    - Partnering with top dealers to expand in FL, TX, AZ, CA (2/3 of US pool starts).
    - Launched 2 new fiberglass models targeting sand state aesthetics.
    - 100% of Q1 SG&A spend allocated to Sand State expansion.
- **Measure by Latham Tool**: 50% of dealers who purchased were new to Latham, supporting market share growth in liners/covers.
- **Brand Momentum**: 
  - Most-searched fiberglass brand online with Q1 interest up significantly.
  - Industry-leading social media engagement and follower growth.
- **Safety Focus**: 50% of pool builders cite labor shortages as a barrier; autocovers reduce labor needs by 75%. Launched partnership with Bode Miller to promote pool safety.

**【CFO Financial Highlights】**
- **Gross Margin**: 190bps expansion to [X]% vs. prior year.
- **SG&A**: 100% of incremental spend allocated to Sand State strategy.
- **Leverage Ratio**: Improved to [X]x, reflecting disciplined capital allocation.
- **Free Cash Flow**: $[X]M, up [X]% YoY from working capital efficiency.

**【Q&A Highlights】**
- **Sand State Expansion Timeline**: Expect dealer network expansion in FL/TX to yield $10M+ incremental revenue by 2027.
- **Autocover Penetration**: 15% of pool owners currently use autocovers; targeting 25% by 2030.
- **Leverage Targets**: Maintain <3.0x leverage while pursuing accretive acquisitions.
- **2025 Outlook**: 
  - Fiberglass market share: +1%.
  - Autocover revenue: +20% YoY.
  - Gross margin: 200-250bps expansion.
  - Free cash flow: >$50M.


Latham (SWIM)-6 May 25-2025 Q1 Earnings call transcript

- **Market Leadership**: Fiberglass pools now 24% of U.S. starts (vs. 23% in 2023), with 75% of Latham's in-ground sales. 
- **Profitability Boost**: 30.2% gross margin (320bps YoY expansion) and $80M adjusted EBITDA. 
- **Strategic Acquisitions**: Coverstar Central adds $5M sales and $1M EBITDA, with two new dealers announced. 
- **Sand States Growth**: 17% of fiberglass sales in Sand States (vs. 15% prior), targeting 24% penetration. 
- **2025 Outlook**: 8% sales growth ($535-565M) and 19% EBITDA growth ($90-100M), driven by auto covers and Sand States expansion. 
- **Tariff Resilience**: $15M annualized impact mitigated via supplier diversification and production shifts. 
- **Cost Efficiency**: $13M annualized savings from lean manufacturing and restructuring.

**【CEO Summary Section】**
- **Market Outperformance**: Despite a 15% decline in U.S. pool starts, Latham achieved 75% of in-ground pool sales from fiberglass, up from 73% in 2023, with fiberglass pools representing 24% of U.S. pool starts (vs. 23% in 2023). 
- **Financial Highlights**: Adjusted EBITDA reached $80 million (15.8% margin), up 30 basis points YoY, driven by gross margin expansion and disciplined cost control. 
- **Strategic Initiatives**: Acquired Coverstar Central to vertically integrate automatic safety covers, contributing $5 million in incremental sales and $1 million in EBITDA. Launched Sand States strategy targeting Florida, Texas, Arizona, and California (66% of U.S. pool starts), with initial success in Texas (40% lead growth YoY). 
- **2025 Outlook**: Guided for 8% sales growth ($535-565M) and 19% EBITDA growth ($90-100M), driven by Sand States penetration, auto cover adoption, and Coverstar acquisitions. 

**【CFO Financial Commentary】**
- **Q4 2024 Results**: Net sales $87M (-4% YoY), gross margin 25% (130bps expansion), adjusted EBITDA $4M (-63% YoY) due to increased SG&A. 
- **Full Year 2024**: Net sales $509M (-10% YoY), gross margin 30.2% (320bps expansion), adjusted EBITDA $80M (-10% YoY) despite $18M net loss. 
- **Balance Sheet Strength**: $56M cash, $282M total debt, 2.8x net leverage ratio. 
- **2025 Guidance**: Capital expenditures $27-33M to support Sand States production and new fiberglass models. 

**【Q&A Key Themes】**
- **Sales Growth Breakdown**: 3% from Coverstar Central and 5% organic (fiberglass penetration + Sand States). 
- **Dealer Feedback**: 1/3 of large dealers report flat/backlog growth vs. 2024, with 17% Latham fiberglass sales in Sand States (vs. 15% prior). 
- **Tariff Mitigation**: $15M annualized impact offset by diversifying suppliers, pre-buying materials, and shifting production. 
- **EBITDA Growth Drivers**: 30bps gross margin expansion, $9M lean manufacturing savings, and Coverstar synergies. 
- **Sand States Strategy**: Targeting 24% fiberglass penetration in Sand States (vs. 24% U.S. average), with 2% YoY growth in 2024. 
- **Coverstar Acquisitions**: Two new dealers add $5M sales and $1M EBITDA, with potential for further M&A in auto covers. 
- **Cost Control**: $4M restructuring savings and $9M lean manufacturing savings, offsetting $8M higher SG&A for growth initiatives.

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