Hayward Holdings, Inc. 2026 Q1 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended March 28, 2026. Hayward Holdings, Inc. is a global specialty water management company focused on pool and outdoor living technology and industrial flow control products. The company operates through two reportable segments: North America (NAM) and Europe & Rest of World (E&RW). The quarter included one fewer working day compared to the prior year period.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Net Sales | $255.2 million | $228.8 million |
| Gross Profit | $118.7 million | $105.3 million |
| Gross Margin | 46.5% | 46.0% |
| Operating Income | $42.5 million | $33.5 million |
| Net Income | $23.4 million | $14.3 million |
| Diluted EPS | $0.11 | $0.06 |
| Adjusted EBITDA | $56.4 million | $49.1 million |
| Cash & Equivalents | $135.8 million | $181.3 million (End of Q1 2025) |
| Long-Term Debt | $942.8 million | $943.5 million |
Material Changes vs. Prior Period
- Revenue Growth: Net sales increased 11.5% year-over-year, driven by an 8.6% increase in net price (offsetting inflation and tariffs), 1.9% favorable currency impact, and 1.0% volume growth.
- Profitability: Net income rose 63.0% to $23.4 million. Operating income increased by $9.0 million due to sales growth and operating efficiencies, partially offset by higher SG&A expenses.
- Cash Flow: Net cash used in operating activities increased significantly to $150.6 million (from $5.9 million used in Q1 2025). This was primarily due to a $151.6 million increase in accounts receivable, as the company did not sell receivables under its Receivables Purchase Agreement in Q1 2026, unlike the $100 million sold in Q1 2025.
- Segment Performance:
- NAM: Sales up 12.1%; Segment income up 16.2% to $50.5 million.
- E&RW: Sales up 8.7%; Segment income up 26.7% to $8.3 million, driven by operational efficiencies and currency translation.
Outlook, Risks, and Unusual Items
- Seasonality: The business is seasonal with lower cash flow in Q1 due to the "Early Buy" program extended payment terms. Cash is expected to improve in Q2 and Q3.
- Legal Proceedings: A securities class action settlement reached in principle in November 2025 received preliminary court approval in February 2026. The company recorded a $9.9 million loss contingency and $7.3 million insurance receivable. Four shareholder derivative lawsuits remain pending with no estimated loss range.
- Tariffs and Trade: Significant uncertainty remains regarding U.S. tariffs following a Supreme Court ruling striking down IEEPA tariffs in February 2026. The company may be eligible for refunds on previously paid tariffs, but timing and amounts are uncertain.
- Share Repurchases: The company repurchased 350,000 shares for $5.9 million in Q1 2026. $440.2 million remains available under the $450 million program authorized in July 2025.
- Debt: The company remains in compliance with all covenants. The First Lien Term Facility ($955 million) matures in May 2028. No mandatory prepayment was required for 2026.
Investor Verification Checklist
- Receivables Turnover: Verify the impact of the "Early Buy" program on accounts receivable aging and collection timelines in Q2.
- Tariff Refunds: Monitor updates on the eligibility and timing of potential tariff refunds following the Supreme Court ruling.
- Legal Settlement Finalization: Track the final settlement hearing scheduled for July 28, 2026, and any potential changes to the $9.9 million accrual.
- Derivative Litigation: Assess the status of the four pending shareholder derivative lawsuits and potential insurance coverage for defense costs.
- Inventory Levels: Review inventory build-up trends in Q1 to ensure alignment with Q2 demand expectations.