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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30,
2025
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
to
POOL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
0-26640
36-3943363
(State or other jurisdiction
(Commission File Number)
(I.R.S. Employer
of incorporation)
Identification No.)
109 Northpark Boulevard,
Covington,
Louisiana
70433-5001
(Address of principal executive
(Zip Code)
offices)
(985)
892-5521
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.001 per share
POOL
Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
☒
No
☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes
☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
☐
No x
As of October 24, 2025, there were
37,249,484
shares of the registrant's common stock outstanding.
Equity in earnings of unconsolidated investments, net
15
64
56
180
Net income
$
127,013
$
125,701
$
374,816
$
397,025
Earnings per share attributable to common stockholders:
Basic
$
3.41
$
3.29
$
10.01
$
10.37
Diluted
$
3.40
$
3.27
$
9.97
$
10.30
Weighted average common shares outstanding:
Basic
37,090
37,983
37,272
38,104
Diluted
37,223
38,187
37,420
38,330
Cash dividends declared per common share
$
1.25
$
1.20
$
3.70
$
3.50
The accompanying Notes are an integral part of the Consolidated Financial Statements.
1
POOL CORPORATION
Consolidated Statement
s of Comprehensive Income
(Unaudited)
(In thousands)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Net income
$
127,013
$
125,701
$
374,816
$
397,025
Other comprehensive (loss) income:
Foreign currency translation (loss) gain
(
1,632
)
5,066
15,653
(
3,286
)
Unrealized loss on interest rate swaps, net of the change in taxes of $
584
, $
2,192
, $
2,289
and $
1,909
(
1,753
)
(
6,577
)
(
6,868
)
(
5,727
)
Total other comprehensive (loss) income
(
3,385
)
(
1,511
)
8,785
(
9,013
)
Comprehensive income
$
123,628
$
124,190
$
383,601
$
388,012
The accompanying Notes are an integral part of the Consolidated Financial Statements.
2
POOL CORPORATION
Consolidated
Balance Sheets
(In thousands, except share data)
September 30,
September 30,
December 31,
2025
2024
2024
(Unaudited)
(Unaudited)
(Audited)
Assets
Current assets:
Cash and cash equivalents
$
128,483
$
91,347
$
77,862
Receivables, net
138,072
119,538
115,835
Receivables pledged under receivables facility
305,537
306,155
199,026
Product inventories, net
1,223,809
1,180,491
1,289,300
Prepaid expenses and other current assets
53,138
43,168
47,091
Total current assets
1,849,039
1,740,699
1,729,114
Property and equipment, net
267,408
243,308
251,324
Goodwill
705,266
700,147
698,910
Other intangible assets, net
285,409
292,722
290,732
Equity interest investments
1,514
1,434
1,439
Operating lease assets
319,898
309,648
314,853
Other assets
72,137
79,431
81,812
Total assets
$
3,500,671
$
3,367,389
$
3,368,184
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable
$
457,319
$
401,702
$
525,235
Accrued expenses and other current liabilities
147,122
185,118
171,194
Short-term borrowings and current portion of long-term debt
12,881
44,683
49,473
Current operating lease liabilities
102,189
95,412
98,284
Total current liabilities
719,511
726,915
844,186
Deferred income taxes
79,101
65,106
81,408
Long-term debt, net
1,049,121
879,146
900,883
Other long-term liabilities
47,342
43,612
44,959
Non-current operating lease liabilities
225,706
220,101
223,283
Total liabilities
2,120,781
1,934,880
2,094,719
Stockholders’ equity:
Common stock,
0.001
par value;
100,000,000
shares authorized;
37,315,849
,
38,083,401
and
37,691,942
shares issued and
outstanding at September 30, 2025, September 30, 2024 and
December 31, 2024, respectively
37
38
38
Additional paid-in capital
665,203
632,523
638,615
Retained earnings
719,529
802,379
648,476
Accumulated other comprehensive loss
(
4,879
)
(
2,431
)
(
13,664
)
Total stockholders’ equity
1,379,890
1,432,509
1,273,465
Total liabilities and stockholders’ equity
$
3,500,671
$
3,367,389
$
3,368,184
The accompanying Notes are an integral part of the Consolidated Financial Statements.
3
POOL CORPORATION
Condensed Consolidated Sta
tements of Cash Flows
(Unaudited)
(In thousands)
Nine Months Ended
September 30,
2025
2024
Operating activities
Net income
$
374,816
$
397,025
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
30,438
26,848
Amortization
6,598
6,514
Share-based compensation
17,385
14,391
Equity in earnings of unconsolidated investments, net
(
56
)
(
180
)
Other
459
3,123
Changes in operating assets and liabilities, net of effects of acquisitions:
Receivables
(
123,914
)
(
80,362
)
Product inventories
77,407
181,326
Prepaid expenses and other assets
73,226
57,151
Accounts payable
(
69,794
)
(
109,021
)
Accrued expenses and other liabilities
(
100,822
)
(
8,196
)
Net cash provided by operating activities
285,743
488,619
Investing activities
Acquisition of businesses, net of cash acquired
(
7,116
)
(
4,435
)
Purchases of property and equipment, net of sale proceeds
(
48,123
)
(
45,951
)
Other investments, net
(
508
)
944
Net cash used in investing activities
(
55,747
)
(
49,442
)
Financing activities
Proceeds from revolving line of credit
1,417,100
1,146,900
Payments on revolving line of credit
(
1,390,400
)
(
1,274,400
)
Proceeds from term loan under credit facility
125,000
—
Payments on term loan under credit facility
(
87,500
)
(
18,750
)
Proceeds from asset-backed financing
437,600
623,900
Payments on asset-backed financing
(
370,400
)
(
606,300
)
Payments on term facility
(
19,938
)
—
Proceeds from short-term borrowings and current portion of long-term debt
17,431
8,873
Payments on short-term borrowings and current portion of long-term debt
(
16,523
)
(
8,643
)
Payments of deferred financing costs
(
1,397
)
(
1,731
)
Proceeds from stock issued under share-based compensation plans
9,203
11,955
Payments of cash dividends
(
138,664
)
(
134,181
)
Repurchases of common stock
(
163,884
)
(
159,408
)
Net cash used in financing activities
(
182,372
)
(
411,785
)
Effect of exchange rate changes on cash and cash equivalents
2,997
(
2,585
)
Change in cash and cash equivalents
50,621
24,807
Cash and cash equivalents at beginning of period
77,862
66,540
Cash and cash equivalents at end of period
$
128,483
$
91,347
The accompanying Notes are an integral part of the Consolidated Financial Statements.
4
POOL CORPORATION
Consolidated Statements of
Changes in Stockholders’ Equity
(Unaudited)
(In thousands)
Common Stock
Additional
Paid-In
Retained
Accumulated
Other
Comprehensive
Shares
Amount
Capital
Earnings
Loss
Total
Balance at December 31, 2024
37,692
$
38
$
638,615
$
648,476
$
(
13,664
)
$
1,273,465
Net income
—
—
—
53,545
—
53,545
Foreign currency translation
—
—
—
—
3,927
3,927
Interest rate swaps, net of the change in taxes $
970
—
—
—
—
(
2,911
)
(
2,911
)
Repurchases of common stock, net of retirements
(
169
)
—
—
(
56,530
)
—
(
56,530
)
Share-based compensation
—
—
6,055
—
—
6,055
Issuance of stock under share-based compensation plans
137
—
6,383
—
—
6,383
Declaration of cash dividends
—
—
—
(
45,243
)
—
(
45,243
)
Balance at March 31, 2025
37,660
$
38
$
651,053
$
600,248
$
(
12,648
)
$
1,238,691
Net income
—
—
—
194,258
—
194,258
Foreign currency translation
—
—
—
—
13,358
13,358
Interest rate swaps, net of the change in taxes of $
735
—
—
—
—
(
2,204
)
(
2,204
)
Repurchases of common stock, net of retirements
(
351
)
(
1
)
—
(
105,322
)
—
(
105,323
)
Share-based compensation
—
—
6,895
—
—
6,895
Issuance of stock under share-based compensation plans
5
—
397
—
—
397
Declaration of cash dividends
—
—
—
(
46,954
)
—
(
46,954
)
Balance at June 30, 2025
37,314
$
37
$
658,345
$
642,230
$
(
1,494
)
$
1,299,118
Net income
—
—
—
127,013
—
127,013
Foreign currency translation
—
—
—
—
(
1,632
)
(
1,632
)
Interest rate swaps, net of the change in taxes of $
584
—
—
—
—
(
1,753
)
(
1,753
)
Repurchases of common stock, net of retirements
(
11
)
—
—
(
3,208
)
—
(
3,208
)
Share-based compensation
—
—
4,435
—
—
4,435
Issuance of stock under share-based compensation plans
13
—
2,423
—
—
2,423
Declaration of cash dividends
—
—
—
(
46,506
)
—
(
46,506
)
Balance at September 30, 2025
37,316
$
37
$
665,203
$
719,529
$
(
4,879
)
$
1,379,890
5
Common Stock
Additional
Paid-In
Retained
Accumulated
Other
Comprehensive
Shares
Amount
Capital
Earnings
Income (Loss)
Total
Balance at December 31, 2023
38,355
$
38
$
606,177
$
699,990
$
6,582
$
1,312,787
Net income
—
—
—
78,885
—
78,885
Foreign currency translation
—
—
—
—
(
3,668
)
(
3,668
)
Interest rate swaps, net of the change in taxes of $(
742
)
—
—
—
—
2,226
2,226
Repurchases of common stock, net of retirements
(
41
)
—
—
(
16,304
)
—
(
16,304
)
Share-based compensation
—
—
5,328
—
—
5,328
Issuance of stock under share-based compensation plans
148
—
8,773
—
—
8,773
Declaration of cash dividends
—
—
—
(
42,343
)
—
(
42,343
)
Balance at March 31, 2024
38,462
$
38
$
620,278
$
720,228
$
5,140
$
1,345,684
Net income
—
—
—
192,439
—
192,439
Foreign currency translation
—
—
—
—
(
4,684
)
(
4,684
)
Interest rate swaps, net of the change in taxes of $
459
—
—
—
—
(
1,376
)
(
1,376
)
Repurchases of common stock, net of retirements
(
181
)
—
—
(
68,519
)
—
(
68,519
)
Share-based compensation
—
—
5,016
—
—
5,016
Issuance of stock under share-based compensation plans
8
—
1,053
—
—
1,053
Declaration of cash dividends
—
—
—
(
45,944
)
—
(
45,944
)
Balance at June 30, 2024
38,289
$
38
$
626,347
$
798,204
$
(
920
)
$
1,423,669
Net income
—
—
—
125,701
—
125,701
Foreign currency translation
—
—
—
—
5,066
5,066
Interest rate swaps, net of the change in taxes of $
2,192
—
—
—
—
(
6,577
)
(
6,577
)
Repurchases of common stock, net of retirements
(
219
)
—
—
(
75,632
)
—
(
75,632
)
Share-based compensation
—
—
4,047
—
—
4,047
Issuance of stock under share-based compensation plans
13
—
2,129
—
—
2,129
Declaration of cash dividends
—
—
—
(
45,894
)
—
(
45,894
)
Balance at September 30, 2024
38,083
$
38
$
632,523
$
802,379
$
(
2,431
)
$
1,432,509
The accompanying Notes are an integral part of the Consolidated Financial Statements.
6
POOL CORPORATION
Notes to Consolidated Fin
ancial Statements
(Unaudited)
Note 1 – Summary of Significant Accounting Policies
Pool Corporation (the
Company
, which may also be referred to as
we, us
or
our
) prepared the unaudited interim Consolidated Financial Statements following U.S. generally accepted accounting principles (GAAP) and the requirements of the Securities and Exchange Commission (SEC) for interim financial information. As permitted under those rules, we have condensed or omitted certain footnotes and other financial information required for complete financial statements.
The interim Consolidated Financial Statements include all normal and recurring adjustments that are necessary for a fair presentation of our financial position and operating results. All significant intercompany accounts and intercompany transactions have been eliminated.
A description of our significant accounting policies is included in our 2024 Annual Report on Form 10-K. You should read the interim Consolidated Financial Statements in conjunction with the Consolidated Financial Statements and accompanying notes in our 2024 Annual Report on Form 10-K. The results for our three and nine months ended September 30, 2025 are not necessarily indicative of the expected results for our fiscal year ending December 31, 2025.
Income Taxes
We reduce federal and state income taxes payable by the tax benefits associated with the exercise of nonqualified stock options and the lapse of restrictions on restricted stock awards. To the extent realized tax deductions exceed the amount of previously recognized deferred tax benefits related to share-based compensation, we record an excess tax benefit. We record all excess tax benefits as a component of income tax benefit or expense on the Consolidated Statements of Income in the period in which stock options are exercised or restrictions on restricted stock awards lapse. In the third quarter of 2025, we recorded an excess tax benefit of
$
0.3
million
compared to
$
0.5
million
in the third quarter of 2024. For the nine months ended September 30, 2025, we recorded an excess tax benefit of
$
4.2
million
compared to
$
8.3
million
in the nine months ended September 30, 2024.
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law in the U.S., including a broad range of tax reform provisions. We currently do not expect the changes resulting from the OBBBA to have a material impact on our results of operations.
Retained Earnings
We account for the retirement of repurchased shares as a reduction of Retained earnings. As of September 30, 2025, the Retained earnings on our Consolidated Balance Sheets reflects (i) cumulative net income, (ii) the cumulative impact of adjustments for changes in accounting pronouncements, (iii) share retirements since the inception of our share repurchase programs of
$
2.9
billion
and (iv) cumulative dividends of
$
1.4
billion
.
Accumulated Other Comprehensive Loss
The table below presents the components of our Accumulated other comprehensive loss balance (in thousands):
September 30,
December 31,
2025
2024
2024
Foreign currency translation adjustments
$
(
13,435
)
$
(
15,985
)
$
(
29,088
)
Unrealized gains on interest rate swaps, net of tax
8,556
13,554
15,424
Accumulated other comprehensive loss
$
(
4,879
)
$
(
2,431
)
$
(
13,664
)
7
Recent Accounting Pronouncements Pending Adoption
The following table summarizes recent accounting pronouncements that we plan to adopt in future periods:
Standard
Description
Effective Date
Effect on Financial
Statements and Other
Significant Matters
Accounting Standards Update (ASU) 2025-06,
Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software
In September 2025, the Financial Accounting Standards Board (FASB) issued ASU 2025-06,
Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software,
which modernizes the accounting for internal-use software to current development practices, clarifies when to begin capitalizing costs and enhances disclosure requirements.
For annual periods beginning after December 15, 2027, including interim periods within those fiscal years. The ASU may be adopted on a prospective or retrospective basis with early adoption permitted.
We are currently evaluating the impact that the adoption of this standard will have on our consolidated financial statements and related disclosures.
ASU 2025-05,
Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets
In June 2025, the FASB issued ASU 2025-05,
Financial Instruments — Credit Losses (Topic 326): Modifications to Receivable and Contract Assets,
which reduces the cost and complexity of applying the current expected credit loss model to current accounts receivable and current contract assets for public business entities through a practical expedient to assume that current conditions as of the balance sheet date will continue for the remaining life of those assets.
For annual periods beginning after December 15, 2025, including interim periods within those fiscal years. The ASU may be adopted on a prospective basis with early adoption permitted.
We do not expect that the adoption of this standard will have a material impact on our consolidated financial statements or related disclosures.
ASU 2024-03,
Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
and related amendments
In November 2024, the FASB issued ASU 2024-03,
Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
, which adds new disclosure requirements, including more detailed information about certain income statement expense line items and a separate disclosure for selling expenses.
For annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The ASU may be adopted on a prospective or retrospective basis with early adoption permitted.
We are currently evaluating the impact that the adoption of this standard will have on our disclosures.
ASU 2023-09,
Income Taxes (Topic 740):
Improvements to Income Tax Disclosures
In December 2023, the FASB issued ASU 2023-09,
Income Taxes (Topic 740): Improvements to Income Tax Disclosures
, which will require enhancements and further transparency for decision usefulness to various income tax disclosures, most notably the tax rate reconciliation and income taxes paid.
For annual periods beginning after December 15, 2024. This ASU may be adopted on a prospective basis. Retrospective application and early adoption are also permitted.
We expect that the adoption of this standard will expand our disclosures but do not expect the adoption of this standard to have a material impact on our consolidated financial statements.
8
Standard
Description
Effective Date
Effect on Financial
Statements and Other
Significant Matters
ASU 2023-06,
Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative
In October 2023, the FASB issued ASU 2023-06,
Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative
, which will impact various disclosure areas, including the statement of cash flows, accounting changes and error corrections, earnings per share, debt, equity, derivatives, and transfers of financial assets.
On the date the related disclosures are removed from Regulation S-X or Regulation S-K by the SEC and will no longer be effective if the SEC has not removed the applicable disclosure requirement by June 30, 2027. Early adoption is prohibited.
We do not expect that the adoption of this standard will have a material impact on our consolidated financial statements or related disclosures.
Note 2 – Earnings Per Share
We calculate basic and diluted earnings per share using the two-class method. Earnings per share under the two-class method is calculated using net income attributable to common stockholders, which is net income reduced by the earnings allocated to participating securities. Our participating securities include share-based payment awards that contain a non-forfeitable right to receive dividends and are considered to participate in undistributed earnings with common shareholders. Participating securities excluded from weighted average common shares outstanding were
184,000
for the three and nine months ended September 30, 2025 and
206,000
for the
three and nine months ended September 30, 2024.
The table below presents the computation of earnings per share, including the reconciliation of basic and diluted weighted average shares outstanding (in thousands, except per share data):
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Net income
$
127,013
$
125,701
$
374,816
$
397,025
Amounts allocated to participating securities
(
626
)
(
654
)
(
1,847
)
(
2,071
)
Net income attributable to common stockholders
$
126,387
$
125,047
$
372,969
$
394,954
Weighted average common shares outstanding:
Basic
37,090
37,983
37,272
38,104
Effect of dilutive securities:
Stock options and employee stock purchase plan
133
204
148
226
Diluted
37,223
38,187
37,420
38,330
Earnings per share attributable to common stockholders:
Basic
3.41
$
3.29
10.01
$
10.37
Diluted
3.40
$
3.27
9.97
$
10.30
Anti-dilutive stock options excluded from diluted earnings per share computations
(¹)
188
88
190
57
(1)
Since these options have exercise prices that are higher than the average market prices of our common stock, including them in the calculation would have an anti-dilutive effect on earnings per share.
9
Note 3 – Acquisitions
In August 2025, we acquired the distribution assets of Great Plains Supply Pool and Spa Products, a wholesale distributor of swimming pool products and supplies, adding
one
location in Kansas and
one
location in Texas.
In May 2024, we acquired the distribution assets of Swimline Distributors, Inc., a wholesale distributor of swimming pool products and supplies, adding
one
location in Georgia
.
In January 2024, we acquired the distribution assets of Shoreline Pool Distribution, a wholesale distributor of swimming pool products and supplies, adding
one
location in Mississippi.
We have completed our accounting for these acquisitions, subject to adjustments for standard holdback provisions per the terms of the purchase agreements, which are not material.
Note 4 – Fair Value Measurements and Interest Rate Swaps
Recurring Fair Value Measurements
Our assets and liabilities that are measured at fair value on a recurring basis include the unrealized gains or losses on our interest rate swap contracts and our deferred compensation plan asset and liability. The three levels of the fair value hierarchy under the accounting guidance are described below:
Level 1
Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in
active markets.
Level 2
Inputs to the valuation methodology include:
•
quoted prices for similar assets or liabilities in active markets;
•
quoted prices for identical or similar assets or liabilities in inactive markets;
•
inputs other than quoted prices that are observable for the asset or liability; or
•
inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3
Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The table below presents our assets and liabilities measured and recorded at fair value on a recurring basis (in thousands):
Fair Value at September 30,
Input Level
Classification
2025
2024
Assets
Unrealized gains on interest rate swaps
Level 2
Prepaid expenses and other current assets
$
—
$
1,905
Unrealized gains on interest rate swaps
Level 2
Other assets
11,453
16,213
Deferred compensation plan asset
Level 1
Other assets
19,535
18,179
Liabilities
Deferred compensation plan liability
Level 1
Other long-term liabilities
$
19,535
$
18,179
Interest Rate Swaps
We utilize interest rate swap contracts to reduce our exposure to fluctuations in variable interest rates for future interest payments on a portion of our variable rate borrowings.
We use significant other observable market data or assumptions (Level 2 inputs) in determining the fair value of our interest rate swap contracts that we believe market participants would use in pricing similar assets or liabilities, including assumptions about counterparty risk. Our fair value estimates reflect an income approach based on the terms of the interest rate swap contracts and inputs corroborated by observable market data including interest rate curves.
10
We recognize any differences between the variable interest rate in effect and the fixed interest rates per our swap contracts as an adjustment to interest expense over the life of the swaps. To the extent our derivatives are effective in offsetting the variability of the hedged cash flows, we record the changes in the estimated fair value of our interest rate swap contracts to Accumulated other comprehensive loss on the Consolidated Balance Sheets.
Our interest rate swaps in effect during the first nine months of 2025 were previously forward-starting and converted the variable interest rate to a fixed interest rate on a portion of our variable rate borrowings. Interest expense related to the notional amounts under our swap contracts was based on the fixed rates plus the applicable margin on our variable rate borrowings. We recorded changes in the estimated fair value of these interest rate swap contracts to Accumulated other comprehensive loss on the Consolidated Balance Sheets.
We currently have two swap contracts in place. The following table provides additional details related to these swap contracts:
Derivative
Inception Date
Effective Date
Termination
Date
Notional
Amount
(in millions)
Fixed Interest
Rate
Interest rate swap 1
March 9, 2020
September 29, 2022
February 26, 2027
$
150.0
0.6690
%
Interest rate swap 2
March 9, 2020
February 28, 2025
February 26, 2027
$
150.0
0.7630
%
One of our interest rate swap contracts terminated on February 28, 2025. The following table provides additional details related to this former swap contract:
Derivative
Inception Date
Effective Date
Termination
Date
Notional
Amount
(in millions)
Fixed Interest
Rate
Former interest rate swap 1
February 5, 2020
February 26, 2021
February 28, 2025
$
150.0
1.3260
%
For the interest rate swap contracts in effect at September 30, 2025, a portion of the change in the estimated fair value between periods relates to future interest expense. Recognition of the change in fair value between periods attributable to accrued interest is reclassified from Accumulated other comprehensive loss on the Consolidated Balance Sheets to Interest and other non-operating expenses, net on the Consolidated Statements of Income. These amounts were not material in the three and nine-month periods ended September 30, 2025 or September 30, 2024.
Failure of any of our swap counterparties would result in the loss of any potential benefit to us under our swap agreements. In this case, we would still be obligated to pay the variable interest payments underlying our debt agreements. Additionally, failure of our swap counterparties would not eliminate our obligation to continue to make payments under our existing swap agreements if we were in a net pay position.
Our interest rate swap contracts are subject to master netting arrangements. According to our accounting policy, we do not offset the fair values of assets with the fair values of liabilities related to these contracts.
Other
Our deferred compensation plan asset represents investments in securities (primarily mutual funds) traded in an active market (Level 1 inputs) held for the benefit of certain employees as part of our deferred compensation plan. We record an equal and offsetting deferred compensation plan liability, which represents our obligation to participating employees. Changes in the fair value of the plan asset and liability are reflected in Selling and administrative expenses on the Consolidated Statements of Income.
The carrying values of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate fair value due to the short maturity of those instruments. The carrying value of our long-term debt approximates its fair value. Our determination of the estimated fair value reflects a discounted cash flow model using our estimates, including assumptions related to borrowing rates (Level 3 inputs).
11
Note 5 – Debt
The table below presents the components of our debt (in thousands):
September 30,
2025
2024
Variable rate debt
Current portion of long-term debt:
Australian credit facility
$
12,881
$
13,433
Current portion of term loans under credit facility
—
31,250
Short-term borrowings and current portion of long-term debt
$
12,881
$
44,683
Long-term portion:
Revolving credit facility
$
221,300
$
125,000
Term loan under credit facility
500,000
437,500
Term facility
90,000
109,938
Receivables securitization facility
241,300
209,300
Less: financing costs, net
3,479
2,592
Long-term debt, net
1,049,121
879,146
Total debt
$
1,062,002
$
923,829
Credit Facility
Our Credit Facility provides for
$
1.3
billion
in borrowing capacity consisting of an
$
800.0
million
revolving credit facility and a
$
500.0
million
term loan facility. Under our Credit Facility at September 30, 2025, there was
$
221.3
million
of revolving borrowings outstanding, a
$
500.0
million
term loan,
$
14.4
million
of standby letters of credit outstanding and
$
564.3
million
available for borrowing.
On July 10, 2025, we entered into the Fourth Amended and Restated Credit Agreement (the Amended Agreement), by and among us, as U.S. Borrower, SCP Distributors Canada Inc., as Canadian Borrower, SCP International, Inc., as Euro Borrower, Wells Fargo Bank, National Association, as Administrative Agent, and certain other lenders party thereto. The Amended Agreement amends and restates the terms of our predecessor credit agreement principally by refinancing the predecessor
$
500.0
million
term loan, extending the term loan maturity date from September 26, 2026 to September 30, 2029 and removing the term secured overnight financing rate (Term SOFR) adjustment of
0.10
%
. Under the Amended Agreement, the term loan requires quarterly amortization payments commencing on September 30, 2027, with all remaining principal due on September 30, 2029. Revolving and term loan borrowings under the Amended Agreement continue to bear interest at a variable rate based on one-month Term SOFR, plus an applicable margin.
Otherwise, the Amended Agreement retains the core features of the predecessor credit agreement, including:
•
$
1.3
billion
in borrowing capacity, consisting of:
o
an
$
800.0
million
revolving credit facility;
o
a
$
500.0
million
term loan facility;
•
an accordion feature permitting us to request one or more incremental term loans or revolving credit facility commitment increases up to
$
250.0
million
;
•
an option permitting us to extend the maturity date of the revolving credit facility up to two years, subject to various conditions and restrictions; and
•
sublimits for the issuance of swingline loans and standby letters of credit.
12
Substantially all of the other terms of the term loan and revolving credit facility in the Amended Agreement remain similar to the predecessor credit agreement. The Amended Agreement continues to require us to maintain a maximum average total leverage ratio and a minimum fixed charge coverage ratio consistent with the terms specified in the predecessor credit agreement. All obligations under the Amended Agreement continue to be guaranteed on an unsecured basis by substantially all of our existing and future domestic subsidiaries. The Amended Agreement also continues to contain various customary affirmative and negative covenants and events of default. Failure to comply with any of the financial covenants or the occurrence of any other events of default would permit the lenders to, among other things, require immediate payment of all amounts outstanding under the Amended Agreement.
Term Facility
Under our Term Facility, there was
$
90.0
million
outstanding at September 30, 2025.
On July 10, 2025, we also entered into the Fourth Amendment to Credit Agreement, by and among us, as Borrower, the guarantors party thereto, and Bank of America, N.A., as lender (the Fourth Amendment), which amends that certain Credit Agreement by and among us, as borrower, the guarantors party thereto and Bank of America, N.A., as lender, dated as of December 30, 2019, as amended by that certain First Amendment to Credit Agreement dated October 12, 2021, that certain Second Amendment to Credit Agreement, dated June 30, 2023, and that certain Third Amendment to Credit Agreement, dated September 30, 2024 (as amended, the Term Agreement). The Fourth Amendment principally extends the maturity of the term loan under the Term Agreement from December 30, 2026 to September 30, 2029 to be concurrent with the maturity of the loans under the Amended Agreement and removes the Term SOFR adjustment of
0.10
%
. Term loan borrowings under the Term Agreement bear interest at a variable rate based on one-month Term SOFR, plus an applicable margin. Under the Term Agreement, the term loan is repaid in quarterly installments of
1.250
%
of the term loan on the last business day of each quarter beginning in the third quarter of 2027 with the final principal repayment due September 30, 2029.
Receivables Securitization Facility
Under our Receivables Securitization Facility, there was
$
241.3
million
outstanding at September 30, 2025.
Our accounts receivable securitization facility (the Receivables Facility) enables us to borrow up to
$
210.0
million
to
$
375.0
million
depending on the time of year, by providing for the sale of certain of our receivables to a wholly-owned subsidiary (the Securitization Subsidiary). The Securitization Subsidiary transfers variable undivided percentage interests in the receivables and related rights to certain third-party financial institutions in exchange for cash proceeds, limited to the applicable funding capacities.
We account for the sale of the receivable interests as a secured borrowing on our Consolidated Balance Sheets. The receivables subject to the agreement collateralize the cash proceeds received from the third-party financial institutions. We classify the entire outstanding balance as Long-term debt, net on our Consolidated Balance Sheets as we intend and have the ability to refinance the obligations on a long-term basis. We present the receivables that collateralize the cash proceeds separately as Receivables pledged under receivables facility on our Consolidated Balance Sheets.
13
Note 6 - Segment Information
Since all of our sales centers have similar operations and share similar economic characteristics, we aggregate our sales centers into a single reportable segment and one reportable revenue stream. These similarities include (i) the nature of our products and services, (ii) the types of customers served and (iii) the distribution methods we use. Our chief operating decision maker (CODM) is our president and chief executive officer. Our CODM evaluates each sales center based on individual performance that includes both financial and operational measures. These measures include operating income, accounts receivable and inventory management criteria.
The accounting policies for our segment are the same as those described in Note 1 of our “Notes to Consolidated Financial Statements,” included in Part II, Item 8 in our 2024 Annual Report on Form 10-K and in Note 1 above.
The table below presents segment revenue, operating expenses and operating income and reconciles segment operating income to consolidated income before taxes and equity in earnings (in thousands):
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Net sales
$
1,451,131
$
1,432,879
$
4,307,187
$
4,323,474
Cost of sales
1,021,948
1,016,476
3,030,474
3,038,370
Gross profit
429,183
416,403
1,276,713
1,285,104
Compensation expenses
127,737
119,855
383,921
370,019
Freight out expenses
24,801
27,109
70,573
73,334
Other selling and administrative expenses
98,658
93,086
294,024
285,197
Operating income
177,987
176,353
528,195
556,554
Reconciliation:
Interest and other non-operating expenses, net
12,004
12,355
35,387
39,818
Income before income taxes and equity in earnings
$
165,983
$
163,998
$
492,808
$
516,736
The tables below present supplemental information for our segment (in thousands):
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Depreciation
$
10,634
$
9,257
$
30,438
$
26,848
Amortization
2,286
2,313
6,598
6,514
September 30,
2025
2024
Receivables, net
$
138,072
$
119,538
Receivables pledged under receivables facility
305,537
306,155
Product inventories, net
1,223,809
1,180,491
14
Item 2. Management’s Discussion and Analysis of F
inancial Condition and Results of Operations
You should read the following discussion in conjunction with the accompanying interim Consolidated Financial Statements and notes, the Consolidated Financial Statements and accompanying notes in our 2024 Annual Report on Form 10-K and Management’s Discussion and Analysis in our 2024 Annual Report on Form 10-K.
Forward-Looking Statements
This report contains forward-looking information that involves risks and uncertainties. Our forward-looking statements express our current expectations or forecasts of possible future results or events, including projections of earnings and other financial performance measures, statements of management’s expectations regarding our strategic, operational and capital allocation plans and objectives, management’s views on industry, economic, competitive, technological and regulatory conditions and other forecasts of trends and other matters. Forward-looking statements speak only as of the date of this filing, and we undertake no obligation to publicly update or revise such statements to reflect new circumstances or unanticipated events as they occur. You can identify these statements by the fact that they do not relate strictly to historic or current facts and often use words such as “anticipate,” “estimate,” “expect,” “intend,” “believe,” “will,” “outlook,” “project,” “may,” “can,” “plan,” “target,” “potential,” “should” and other words and expressions of similar meaning.
No assurance can be given that the expected results in any forward-looking statement will be achieved, and actual results may differ materially due to one or more factors, including the sensitivity of our business to weather conditions; changes in economic conditions, consumer discretionary spending, the housing market, inflation or interest rates; our ability to maintain favorable relationships with suppliers and manufacturers; competition from other leisure product alternatives or mass merchants; our ability to continue to execute our growth strategies; changes in the regulatory environment; new or additional taxes, duties or tariffs; excess tax benefits or deficiencies recognized under ASU 2016-09 and other risks detailed in our 2024 Annual Report on Form 10-K, as updated by our subsequent filings with the U.S. Securities and Exchange Commission. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
OVERVIEW
Financial Results
Third quarter ended September 30, 2025 compared to the third quarter
ended September 30, 2024
Net sales increased 1% in the third quarter of 2025. We continued to support sustained customer demand for maintenance products and were pleased to see continuous improvement in sales for our building materials products.
Gross profit grew by $12.8 million and gross margin increased 50 basis points to 29.6% compared to 29.1% in the same period of 2024. Gross margin benefited from mid-season price increases, continued progress on our pricing optimization initiatives and our continued focus on supply chain management.
Selling and administrative expenses (operating expenses) increased 5% compared to the third quarter of 2024, reflecting higher employee-related and facility costs due to sales center network expansion and inflationary pressures, as well as ongoing investments in our customer-facing technology initiatives.
Operating income increased $1.6 million compared to the third quarter of 2024. Operating margin was 12.3% in both the third quarter of 2025 and the third quarter of 2024.
Net income increased to $127.0 million compared to $125.7 million in the third quarter of 2024.
Earnings per diluted share increased 4% to $3.40 in the third quarter of 2025 compared to $3.27 in the same period of 2024. We recorded a $0.3 million, or $0.01 per diluted share, tax benefit from Accounting Standards Update (ASU) 2016-09,
Improvements to Employee Share-Based Payment Accounting
, in the third quarter of 2025 compared to a tax benefit of $0.5 million, or $0.01 per diluted share, realized in the same period of 2024. Adjusting for the impact from ASU 2016-09 in both periods, earnings per diluted share increased 4% to $3.39 compared to $3.26 in the third quarter of 2024.
See RESULTS OF OPERATIONS below for definitions of our non-GAAP measures and reconciliations of our non-GAAP measures to GAAP measures.
References to product line and product category data throughout this report generally reflect data related to the North American swimming pool market, as this data is more readily available for analysis and represents the largest component of our operations.
15
In this Form 10-Q and other of our public disclosures, we estimate the impact that favorable or unfavorable weather had on our operating results. In connection with these estimates, we make several assumptions and rely on various third-party sources. It is possible that others assessing the same data could reach conclusions that differ from ours.
Financial Position and Liquidity
As of September 30, 2025, total net receivables, including pledged receivables, increased 4% compared to September 30, 2024, primarily due to higher sales in September 2025. Our days sales outstanding (DSO), as calculated on a trailing four quarters basis, was 25.9 days at September 30, 2025 and 26.7 days at September 30, 2024. Our allowance for doubtful accounts balance was $8.3 million at September 30, 2025 and $10.0 million at September 30, 2024.
Our inventory balance was $1.2 billion at September 30, 2025, an increase of $43.3 million, or 4%, from September 30, 2024, reflecting increases from inflation (including mid-season vendor price increases), new and acquired sales centers and strategic inventory purchases.
Our inventory reserve was $29.0 million at September 30, 2025 and $28.6 million at September 30, 2024. Our inventory turns, as calculated on a trailing four quarters basis, were 2.8 times at both September 30, 2025 and September 30, 2024.
Total debt outstanding increased $138.2 million to $1.1 billion at September 30, 2025, primarily to fund open market share repurchases of $159.1 million in the first nine months of 2025.
For additional information, see “Liquidity and Capital Resources” below.
Current Trends and Outlook
For a detailed discussion of trends impacting us through 2024, see the Current Trends and Outlook section of Management’s Discussion and Analysis included in Part II, Item 7 of our 2024 Annual Report on Form 10-K.
We expect sales for the full year of 2025 to be relatively flat compared to 2024. We primarily source our products domestically and expect that U.S. tariffs announced so far in 2025 and their resulting price increases will positively impact net sales by approximately 1%, contributing to an estimated benefit of 2% from price for the full year of 2025.
We expect gross margin for the full year of 2025 to be in line with our 2024 gross margin of 29.7%. Our efforts in pricing optimization and supply chain initiatives are expected to mitigate headwinds from less favorable product and customer mix that are currently pressuring our ability to attain our long-term gross margin target of 30.0%.
We expect to leverage our existing infrastructure and strategically manage discretionary spending while continuing to invest in our sales center network and consumer-facing technology initiatives. We project that our operating expenses for 2025 will increase around 3% compared to 2024.
In 2025, we expect our effective tax rate will be around 25.0% without the impact of ASU 2016-09. Due to ASU 2016-09, we expect our effective tax rate will fluctuate from quarter to quarter, particularly in periods when employees elect to exercise their vested stock options or when restrictions on share-based awards lapse. We recorded a $4.2 million, or $0.11 per diluted share, tax benefit from ASU 2016-09 for the nine months ended September 30, 2025. We may recognize additional tax benefits related to stock option exercises during the fourth quarter of 2025. We have not included any expected tax benefits in our full year guidance beyond what we have recognized as of September 30, 2025.
We expect 2025 diluted EPS in the range of $10.81 to $11.31, including the impact of year-to-date tax benefits of $0.11. We expect to continue to use cash for the payment of cash dividends as and when declared by our Board of Directors (Board) and to fund opportunistic share repurchases under our Board-authorized share repurchase program.
The forward-looking statements in the foregoing section and elsewhere in this report are based on current market conditions and our current business plans, speak only as of the filing date of this report, are based on several assumptions and are subject to significant risks and uncertainties, including the risks detailed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. See “Cautionary Statement for Forward-Looking Statements.”
16
RESULTS OF OPERATIONS
As of September 30, 2025, we conducted operations through 454 sales centers in North America, Europe and Australia. For the nine months ended September 30, 2025, approximately 95% of our net sales were from our operations in North America.
The following table presents information derived from the Consolidated Statements of Income expressed as a percentage of net sales:
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Net sales
100.0
%
100.0
%
100.0
%
100.0
%
Cost of sales
70.4
70.9
70.4
70.3
Gross profit
29.6
29.1
29.6
29.7
Selling and administrative expenses
17.3
16.8
17.4
16.9
Operating income
12.3
12.3
12.3
12.9
Interest and other non-operating expenses, net
0.8
0.9
0.8
0.9
Income before income taxes and equity in earnings
11.4
%
11.4
%
11.4
%
12.0
%
Note: Due to rounding, percentages presented in the table above may not add to Operating income or Income before income taxes and equity in earnings.
We have included the results of operations from acquisitions in 2025 and 2024 in our consolidated results since the acquisition dates.
Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024
Base Business
When calculating our base business results, we exclude for a period of 15 months sales centers that are acquired, opened in new markets or closed. We also exclude consolidated sales centers when we do not expect to maintain the majority of the existing business and existing sales centers that we consolidate with acquired sales centers.
We generally allocate corporate overhead expenses to excluded sales centers on the basis of their net sales as a percentage of total net sales. After 15 months, we include acquired, consolidated and new market sales centers in the base business calculation including the comparative prior year period.
We have not provided separate base business income statements within this Form 10-Q as our base business results for the three and nine-month periods ended September 30, 2025
closely
approximated consolidated results for the same period. Acquired and new market sales centers excluded from base business contributed less than 1% to the change in our reported net sales.
The table below summarizes the changes in our sales center count during the first nine months of 2025:
December 31, 2024
448
Acquired locations
2
New locations
6
Closed/Consolidated locations
(2
)
September 30, 2025
454
17
Net Sales
Three Months Ended
September 30,
(in millions)
2025
2024
Change
Net sales
$
1,451.1
$
1,432.9
$
18.2
1%
Net sales of $1.5 billion in the third quarter of 2025 increased 1% compared to $1.4 billion in the third quarter of 2024. Recurring maintenance product sales were stable, and we saw growth in sales of building materials products.
The following factors impacted our sales during the quarter and are listed in order of estimated magnitude:
•
steady maintenance product sales;
•
improved demand for building materials products (see discussion below); and
•
a benefit of 2% from inflationary product cost increases, net of price deflation on some items, compared to a 1% benefit in the third quarter of 2024.
In the third quarter of 2025, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased 4% versus the same period last year, and collectively represented approximately 29% of net sales for the period. The increase in sales of equipment reflects benefits from price and some increase from volumes sold of maintenance-related products. Sales of building materials, which are primarily used in new pool construction and remodeling, increased 4% compared to the same period in 2024 and represented approximately 11% of net sales in the third quarter of 2025.
Gross Profit
Three Months Ended
September 30,
(in millions)
2025
2024
Change
Gross profit
$
429.2
$
416.4
$
12.8
3%
Gross margin
29.6
%
29.1
%
Gross margin improved by 50 basis points to 29.6% in the third quarter of 2025 compared to 29.1% in the third quarter of 2024, while gross profit increased 3% over the same period. The expansion of our gross margin was driven by mid-season price increases, ongoing pricing optimization efforts and disciplined supply chain management, amid continued headwinds from customer mix.
Operating Expenses
Three Months Ended
September 30,
(in millions)
2025
2024
Change
Selling and administrative expenses
$
251.2
$
240.1
$
11.1
5%
Operating expenses as a % of net sales
17.3
%
16.8
%
Selling and administrative expenses in the third quarter of 2025 increased 5% compared to the third quarter of 2024, primarily driven by higher employee-related and facility costs due to sales center network expansion and inflationary pressures, as well as ongoing investments in our customer-facing technology initiatives. These increases were partially offset by reductions in variable costs.
18
Interest and Other Non-Operating Expenses, Net
Interest and other non-operating expenses, net for the third quarter of 2025 decreased $0.4 million compared to the third quarter of 2024. Our weighted average effective interest rate decreased to 4.5% in the third quarter of 2025 compared to 5.2% in the third quarter of 2024 on average outstanding debt of $1.1 billion and $946.1 million for the respective periods.
Income Taxes
Our effective income tax rate was 23.5% for the three months ended September 30, 2025 compared to 23.4% for the three months ended September 30, 2024. We recorded a $0.3 million, or $0.01 per diluted share, tax benefit from ASU 2016-09 in the quarter ended September 30, 2025 compared to a benefit of $0.5 million, or $0.01 per diluted share, in the same period last year. Without the benefit from ASU 2016-09 in both periods, our effective tax rate was 23.7% in both the third quarter of 2025 and the third quarter of 2024. Our third quarter effective income tax rate is historically lower compared to other quarters due to the annual expiration of statutes of limitations in the various jurisdictions where we have recorded uncertain tax positions.
Net Income and Earnings Per Share
Net income increased to $127.0 million in the third quarter of 2025 compared to $125.7 million in the third quarter of 2024. Earnings per diluted share increased 4% to $3.40 in the third quarter of 2025 compared to $3.27 in the same period of 2024. Adjusting for the impact from ASU 2016-09 in both periods, earnings per diluted share increased 4% to $3.39 compared to $3.26 in the third quarter of 2024.
See the reconciliation of GAAP to non-GAAP measures below.
19
Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024
Net Sales
Nine Months Ended
September 30,
(in millions)
2025
2024
Change
Net sales
$
4,307.2
$
4,323.5
$
(16.3
)
(0)%
Net sales for the first nine months of 2025 remained consistent with net sales for the same period last year. Despite ongoing macroeconomic constraints in the first nine months of 2025, non-discretionary spending remained steady, while discretionary activities improved sequentially. In the first quarter of the year, discretionary projects remained pressured from macroeconomic conditions and unfavorable weather. In the second quarter of 2025, we saw sales expansion compared to the second quarter of 2024 and discretionary activities were less of a drag on overall sales. Net sales also increased in the third quarter of 2025 from the third quarter of 2024, supported by price, sustained demand for maintenance products and growth in sales of building materials products from the same period of the prior year.
The following factors impacted our sales in the first nine months of 2025 and are listed in order of estimated magnitude:
•
stable maintenance product sales;
•
lower sales volume of products used in pool construction and discretionary activities (see discussion below); and
•
a benefit of approximately 2% from inflationary product cost increases, net of price deflation on some items, compared to a 1% benefit in the first nine months of 2024.
In the first nine months of 2025, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased approximately 1% compared to the same period last year and collectively represented 30% of net sales in the first nine months of 2025. The increase in sales of equipment reflects benefits from price and some increase from volumes sold of maintenance-related products. Sales of building materials, which are primarily used in new pool construction and remodeling, decreased 1% compared to the first nine months of 2024 and represented approximately 12% of net sales in the first nine months of 2025.
Gross Profit
Nine Months Ended
September 30,
(in millions)
2025
2024
Change
Gross profit
$
1,276.7
$
1,285.1
$
(8.4
)
(1)%
Gross margin
29.6
%
29.7
%
Gross margin declined 10 basis points to 29.6% in the nine months ended September 30, 2025 compared to 29.7% in the first nine months of 2024. Gross margin in the first nine months of 2024 benefited 30 basis points from the non-recurring reversal of $12.6 million for estimated import taxes. In the first nine months of 2025, our gross margin reflected positive impacts from our strategic pricing and supply chain initiatives, partially offset by a less advantageous customer and product mix and the absence of the non-recurring import tax reversal recognized in the prior year.
Operating Expenses
Nine Months Ended
September 30,
(in millions)
2025
2024
Change
Selling and administrative expenses
$
748.5
$
728.6
$
19.9
3%
Operating expenses as a % of net sales
17.4
%
16.9
%
Operating expenses for the nine months ended September 30, 2025 were up 3% compared to the prior year period. Expense growth was primarily driven by inflationary impacts, particularly on base wages and facility costs, and continued investments in our technology initiatives and sales center network expansion.
20
Interest and Other Non-Operating Expenses, Net
Interest and other non-operating expenses, net for the first nine months of 2025 decreased $4.4 million compared to the same period last year. Our weighted average effective interest rate decreased to 4.5% from 5.2% for the respective periods on average outstanding debt of $1.0 billion for both the nine months ended September 30, 2025 and nine months ended September 30, 2024.
Income Taxes
Our effective income tax rate was 24.0% for the nine months ended September 30, 2025 compared to 23.2% for the nine months ended September 30, 2024. We recorded a $4.2 million, or $0.11 per diluted share, tax benefit from ASU 2016-09 in the nine months ended September 30, 2025 compared to an $8.3 million, or $0.21 per diluted share, tax benefit in the same period of 2024. Without the benefits from ASU 2016-09, our effective tax rate was 24.8% for both the nine months ended September 30, 2025 and the nine months ended September 30, 2024.
Net Income and Earnings Per Share
Net income decreased 6% to $374.8 million for the nine months ended September 30, 2025 compared to $397.0 million for the nine months ended September 30, 2024. Earnings per diluted share decreased 3% to $9.97 for the nine months ended September 30, 2025 versus $10.30 per diluted share for the nine months ended September 30, 2024. Adjusting for the impact from ASU 2016-09 in both periods, earnings per diluted share decreased 2% to $9.86 for the nine months ended September 30, 2025 compared to $10.09 for the nine months ended September 30, 2024. See the reconciliation of GAAP to non-GAAP measures below.
Reconciliation of Non-GAAP Financial Measures
The non-GAAP measure described below should be considered in the context of all of our other disclosures in this Form 10-Q.
Adjusted Diluted EPS
We have included adjusted diluted EPS, a non-GAAP financial measure, as a supplemental disclosure, because we believe this measure is useful to management, investors and others in assessing our period-to-period operating performance.
Adjusted diluted EPS is a key measure used by management to demonstrate the impact of tax benefits from ASU 2016-09 on our diluted EPS and to provide investors and others with additional information about our potential future operating performance to supplement GAAP measures.
We believe this measure should be considered in addition to, not as a substitute for, diluted EPS presented in accordance with GAAP, and in the context of our other disclosures in this Form 10-Q. Other companies may calculate this non-GAAP financial measure differently than we do, which may limit its usefulness as a comparative measure.
The table below presents a reconciliation of diluted EPS to adjusted diluted EPS.
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2025
2024
2025
2024
Diluted EPS
$
3.40
$
3.27
$
9.97
$
10.30
ASU 2016-09 tax benefit
(0.01
)
(0.01
)
(0.11
)
(0.21
)
Adjusted diluted EPS
$
3.39
$
3.26
$
9.86
$
10.09
21
Seasonality and Quarterly Fluctuations
Our business is seasonal. In general, sales and operating income are highest during the second and third quarters, which represent the peak months of both swimming pool use and installation and irrigation and landscape installations and maintenance. Sales are lower during the first and fourth quarters. In 2024, we generated approximately 60% of our net sales and 73% of our operating income in the second and third quarters of the year.
We typically experience a build-up of product inventories and accounts payable during the winter months in anticipation of the peak selling season. Excluding borrowings to finance acquisitions and share repurchases, our peak borrowing usually occurs during the second quarter, primarily because extended payment terms offered by our suppliers typically are payable in April, May and June, while our peak accounts receivable collections typically occur in June, July and August.
The following table presents certain unaudited quarterly income statement and balance sheet data for the most recent eight quarters to illustrate seasonal fluctuations in these amounts. We believe this information reflects all normal and recurring adjustments considered necessary for a fair presentation of this data. The results of any one or more quarters are not necessarily a good indication of results for an entire fiscal year or of continuing future trends for a variety of reasons, including the seasonal nature of our business and the impact of new and acquired sales centers.
(Unaudited)
QUARTER
(in thousands)
2025
2024
2023
Third
Second
First
Fourth
Third
Second
First
Fourth
Statement of Income Data
Net sales
$
1,451,131
$
1,784,530
$
1,071,526
$
987,480
$
1,432,879
$
1,769,784
$
1,120,810
$
1,003,050
Gross profit
429,183
535,161
312,369
290,244
416,403
530,141
338,560
293,775
Operating income
177,987
272,670
77,538
60,651
176,353
271,481
108,720
79,344
Net income
127,013
194,258
53,545
37,300
125,701
192,439
78,885
51,437
Balance Sheet Data
Total receivables, net
$
443,609
$
576,804
$
497,076
$
314,861
$
425,693
$
577,529
$
527,175
$
342,910
Product inventories, net
1,223,809
1,330,221
1,460,680
1,289,300
1,180,491
1,295,600
1,496,947
1,365,466
Accounts payable
457,319
529,316
890,167
525,235
401,702
515,645
907,806
508,672
Total debt
1,062,002
1,229,919
1,025,090
950,356
923,829
1,116,553
979,177
1,053,320
We expect that our quarterly results of operations will continue to fluctuate depending on the timing and amount of revenue contributed by new and acquired sales centers. Based on our peak summer selling season, we generally open new sales centers and close or consolidate sales centers, when warranted, either in the first quarter before the peak selling season begins or in the fourth quarter after the peak selling season ends.
22
Weather is one of the principal external factors affecting our business. The table below presents some of the possible effects resulting from various weather conditions.
Weather
Possible Effects
Hot and dry
•
Increased purchases of chemicals and supplies
for existing swimming pools
•
Increased purchases of above-ground pools and
irrigation and lawn care products
Unseasonably cool weather or extraordinary amounts
•
Fewer pool and irrigation and landscape
of rain
installations
•
Decreased purchases of chemicals and supplies
•
Decreased purchases of impulse items such as
above-ground pools and accessories
Unseasonably early warming trends in spring/late cooling
•
A longer pool and landscape season, thus positively
trends in fall
impacting our sales
(primarily in the northern half of the U.S. and Canada)
Unseasonably late warming trends in spring/early cooling
•
A shorter pool and landscape season, thus negatively
trends in fall
impacting our sales
(primarily in the northern half of the U.S. and Canada)
Weather Impacts on 2025 and 2024 Results
Temperatures in the third quarter of 2025 were above average in several regions, including the Northwest, Midwest, South and Western regions. Localized flooding occurred early in the quarter, followed by drought conditions across the Central and Western regions. In the third quarter of 2024, temperatures were slightly warmer than the third quarter of 2025, and there were more variable weather conditions in the third quarter of 2024 with several notable weather events. Overall, weather conditions did not significantly impact our sales results for the third quarter of 2025.
Weather conditions in the second quarter of 2025 were generally marked by above-average temperatures and higher-than-normal precipitation. Warm conditions generally supported seasonal trends, though localized disruptions occurred due to severe storms, flash flooding and tornado outbreaks, particularly in April and May. Around mid-June, we observed intense heat across many regions, further supporting demand in key markets. Overall, while weather patterns were variable, we believe that the net impact on our results was broadly neutral. In the second quarter of 2024, weather across the U.S. was mixed, with wetter conditions in the central regions and Texas, drier conditions in the West, and warmer-than-average temperatures, especially in June, supporting maintenance activities and leading to varied impacts across our markets.
Weather conditions in the first quarter of 2025 were mixed across our key markets. Early January snowstorms and overall cooler temperatures through much of February negatively impacted early season sales activity. While March brought warmer and drier weather, these improvements provided only partial relief to our sales trends and were insufficient to offset the slower start to the quarter. During the first quarter of 2024, above-average temperatures in some regions, including California, contributed positively to economic activities. However, the adverse effects of cooler and wetter weather in Florida and the Southeast, and excessive precipitation in Texas and the Northeast, outweighed the positives, resulting in an overall unfavorable impact on net sales.
23
CRITICAL ACCOUNTING ESTIMATES
We prepare our Consolidated Financial Statements in accordance with U.S. generally accepted accounting principles (GAAP), which require management to make estimates and assumptions that affect reported amounts and related disclosures. Management identifies critical accounting estimates as:
•
those that require the use of assumptions about matters that are inherently and highly uncertain at the time the estimates are made; and
•
those for which changes in the estimates or assumptions, or the use of different estimates and assumptions, could have a material impact on our consolidated results of operations or financial condition.
Management has discussed the development, selection and disclosure of our critical accounting estimates with the Audit Committee of our Board. For a description of our critical accounting estimates that require us to make the most difficult, subjective or complex judgments, please see our 2024 Annual Report on Form 10-K. We have not changed any of these policies from those previously disclosed in that report.
Recent Accounting Pronouncements
See Note 1 of “Notes to Consolidated Financial Statements,” included in Part I, Item 1 of this Form 10-Q for discussion of recent accounting pronouncements.
LIQUIDITY AND CAPITAL RESOURCES
Liquidity is defined as the ability to generate adequate amounts of cash to meet short-term and long-term cash needs. We assess our liquidity in terms of our ability to generate cash to fund our operating activities, taking into consideration the seasonal nature of our business. Significant factors which could affect our liquidity include the following:
•
cash flows generated from operating activities;
•
the adequacy of available bank lines of credit;
•
the quality of our receivables;
•
acquisitions;
•
dividend payments;
•
capital expenditures;
•
changes in income tax laws and regulations;
•
the timing and extent of share repurchases; and
•
the ability to attract long-term capital with satisfactory terms.
Our primary capital needs are seasonal working capital obligations, debt repayment obligations and other general corporate initiatives, including acquisitions, opening new sales centers, customer-facing technology-related investments, dividend payments and discretionary share repurchases. Our primary working capital obligations are for the purchase of inventory, payroll, rent, other facility costs and selling and administrative expenses. Our working capital obligations fluctuate during the year, driven primarily by seasonality and the timing of inventory purchases. Our primary sources of working capital are cash from operations supplemented by bank borrowings, which have historically been sufficient to support our growth and finance acquisitions. We have funded our capital expenditures and share repurchases in substantially the same manner.
We prioritize our use of cash based on investing in our business, maintaining a prudent capital structure, including a modest amount of debt, and returning cash to our shareholders through dividends and share repurchases. Our specific priorities for the use of cash are as follows:
•
capital expenditures primarily for maintenance and growth of our sales center network, technology-related investments and vehicle fleet;
payment of cash dividends as and when declared by our Board;
•
repayment of debt to maintain an average total target leverage ratio (as defined below) between 1.5 and 2.0; and
•
discretionary repurchases of our common stock under our Board-authorized share repurchase program.
24
We focus our capital expenditure plans based on the needs of our existing sales centers and the opening of new sales centers. Our capital spending primarily relates to leasehold improvements, delivery and service vehicles and information technology. In recent years, we have increased our investment in technology and automation enabling us to operate more efficiently and better serve our customers.
Historically, our capital expenditures have averaged roughly 1.0% of net sales. Capital expenditures were 1.1% of net sales in 2024 and 2023. Based on management’s current plans, we project capital expenditures for 2025 will be approximately 1.0% to 1.5% of net sales.
Sources and Uses of Cash
The following table summarizes our cash flows (in thousands):
Nine Months Ended
September 30,
2025
2024
Provided by operating activities
$
285,743
$
488,619
Used in investing activities
(55,747
)
(49,442
)
Used in financing activities
(182,372
)
(411,785
)
Net cash provided by operations was $285.7 million in the first nine months of 2025 compared to net cash provided by operations of $488.6 million in the first nine months of 2024. The difference in cash flow primarily relates to working capital investments, including increases in inventory in the first nine months of 2025, and $68.5 million in federal tax payments from 2024 that were deferred into 2025 due to relief granted by the IRS.
Net cash used in investing activities for the first nine months of 2025 increased $6.3 million compared to the first nine months of 2024, primarily due to a $2.7 million increase in acquisition costs and a $2.2 million increase in net capital expenditures.
Net cash used in financing activities was $182.4 million for the first nine months of 2025 compared to $411.8 million for the first nine months of 2024, primarily reflecting $112.4 million of net debt proceeds in the first nine months of 2025 versus $128.4 million of net debt payments in the first nine months of 2024, partially offset by a $4.5 million increase in both share repurchases and dividend payments in the first nine months of 2025 versus the same period in 2024.
Future Sources and Uses of Cash
To supplement cash from operations as our primary source of working capital, we plan to continue to utilize our three major credit facilities, which are the Fourth Amended and Restated Credit Facility (the Credit Facility), the term facility provided under the below-defined Term Agreement (the Term Facility) and the Receivables Securitization Facility (the Receivables Facility). For additional details regarding these facilities, see the summary descriptions below and more complete descriptions in Note 5 of our “Notes to Consolidated Financial Statements,” included in Part II, Item 8 in our 2024 Annual Report on Form 10-K and Note 5 of “Notes to Consolidated Financial Statements” included in Part I, Item 1 of this Form 10-Q.
Credit Facility
Our Credit Facility, as recently amended, provides for $1.3 billion in borrowing capacity consisting of an $800.0 million revolving credit facility and a $500.0 million term loan facility. The Credit Facility also includes an accordion feature permitting us to request one or more incremental term loans or revolving credit facility commitment increases up to $250.0 million and sublimits for the issuance of swingline loans and standby letters of credit. We pay interest on revolving and term loan borrowings under the Credit Facility at a variable rate based on the one-month Term SOFR, plus an applicable margin. The term loan requires quarterly amortization payments commencing on September 30, 2027, with all remaining principal due on September 30, 2029. We intend to continue to use the Credit Facility for general corporate purposes, for future share repurchases and to fund future growth initiatives.
At September 30, 2025, there was $221.3 million of revolving borrowings outstanding, a $500.0 million term loan outstanding, $14.4 million of standby letters of credit outstanding and $564.3 million available for borrowing. The weighted average effective interest rate for the Credit Facility as of September 30, 2025 was approximately 3.8%, excluding commitment fees and including the impact of our interest rates swaps.
25
Term Facility
Our Term Facility, as recently amended, provides for $90.0 million in borrowing capacity. Proceeds from the Term Facility were used to pay down the Credit Facility in December 2019, adding borrowing capacity for future share repurchases, acquisitions and growth-oriented working capital expansion. We pay interest on borrowings under the Term Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Term Facility is repaid in quarterly installments of 1.250% of the Term Facility beginning in the third quarter of 2027, with the final principal repayment due on September 30, 2029. We may prepay amounts outstanding under the Term Facility without penalty other than interest breakage costs.
At September 30, 2025, there was $90.0 million outstanding under the Term Facility with a weighted average effective interest rate of 5.3%.
Receivables Securitization Facility
Our two-year accounts receivable securitization facility (the Receivables Facility) offers us a low-cost form of financing. Under this facility, we can borrow up to $375.0 million between April through May and from $210.0 million to $350.0 million during the remaining months of the year. We pay interest on borrowings under the Receivables Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Receivables Facility matures on October 30, 2026.
The Receivables Facility provides for the sale of certain of our receivables to a wholly-owned subsidiary (the Securitization Subsidiary). The Securitization Subsidiary transfers variable undivided percentage interests in the receivables and related rights to certain third-party financial institutions in exchange for cash proceeds, limited to the applicable funding capacities. Upon payment of the receivables by customers, rather than remitting to the financial institutions the amounts collected, we retain such collections as proceeds for the sale of new receivables until payments become due.
At September 30, 2025, there was $241.3 million outstanding under the Receivables Facility at a weighted average effective interest rate of 5.1%, excluding commitment fees.
Financial Covenants
Financial covenants of the Credit Facility, Term Facility and Receivables Facility include maintenance of a maximum average total leverage ratio and a minimum fixed charge coverage ratio, which are our most restrictive financial covenants. As of September 30, 2025, the calculations of these two covenants are detailed below:
•
Maximum Average Total Leverage Ratio
. On the last day of each fiscal quarter, our average total leverage ratio must be less than 3.25 to 1.00. Average Total Leverage Ratio is the ratio of the sum of (i) Total Non-Revolving Funded Indebtedness as of such date, (ii) the trailing twelve months (TTM) Average Total Revolving Funded Indebtedness and (iii) the TTM Average Accounts Securitization Proceeds divided by TTM EBITDA (as those terms are defined in the Credit Facility). As of September 30, 2025, our average total leverage ratio equaled 1.58 (compared to 1.47 as of June 30, 2025) and the TTM average total indebtedness amount used in this calculation was $1.0 billion.
•
Minimum Fixed Charge Coverage Ratio
. On the last day of each fiscal quarter, our fixed charge ratio must be greater than or equal to 2.25 to 1.00. Fixed Charge Ratio is the ratio of the TTM EBITDAR divided by TTM Interest Expense paid or payable in cash plus TTM Rental Expense (as those terms are defined in the Credit Facility). As of September 30, 2025, our fixed charge ratio equaled 4.88 (compared to 4.90 as of June 30, 2025) and TTM Rental Expense was $110.9 million.
The Credit Facility and Term Facility limit the declaration and payment of dividends on our common stock to a manner consistent with past practice, provided no default or event of default has occurred and is continuing, or would result from the payment of dividends. We may declare and pay quarterly dividends so long as (i) the amount per share of such dividends is not greater than the most recently publicly announced amount of dividends per share and (ii) our Average Total Leverage Ratio is less than 3.25 to 1.00 both immediately before and after giving pro forma effect to such dividends. Under the Credit Facility and Term Facility, we may repurchase shares of our common stock provided no default or event of default has occurred and is continuing, or would result from the repurchase of shares, and our maximum average total leverage ratio (determined on a pro forma basis) is less than 3.25 to 1.00.
Other covenants in each of our credit facilities include restrictions on our ability to grant liens, incur indebtedness, make investments, merge or consolidate, and sell or transfer assets. Failure to comply with any of our financial covenants or any other terms of our credit facilities could result in, among other things, higher interest rates on our borrowings or the acceleration of the maturities of our outstanding debt.
26
Interest Rate Swaps
We utilize interest rate swap contracts to reduce our exposure to fluctuations in variable interest rates for future interest payments on our variable rate borrowings. Interest expense related to the notional amounts under all swap contracts is based on the fixed rates plus the applicable margin on the respective borrowings.
As of September 30, 2025, we had two interest rate swap contracts in place, each of which has the effect of converting our exposure to variable interest rates on a portion of our variable rate borrowings to fixed interest rates. For more information, see Note 4 of “Notes to Consolidated Financial Statements” included in Part I, Item 1 of this Form 10-Q.
Compliance and Future Availability
As of September 30, 2025, we were in compliance with all material covenants and financial ratio requirements under our Credit Facility, our Term Facility and our Receivables Facility. We believe we will remain in compliance with all material covenants and financial ratio requirements throughout the next twelve months. For additional information regarding our debt arrangements, see Note 5 of “Notes to Consolidated Financial Statements,” included in Part II, Item 8 of our 2024 Annual Report on Form 10-K, as updated by Note 5 of “Notes to Consolidated Financial Statements,” included in Part I, Item 1 of this Form 10-Q.
We believe we have adequate availability of capital to fund present operations and the current capacity to finance any working capital needs that may arise. We continually evaluate potential acquisitions and hold discussions with acquisition candidates. If suitable acquisition opportunities arise that would require financing, we believe that we would have the ability to finance any such transactions.
As of October 24, 2025, we were authorized to purchase up to $493.2 million of our common stock under our current Board-approved share repurchase program. We expect to continue to repurchase shares on the open market from time to time subject to market conditions. We plan to fund these repurchases with cash provided by operations and borrowings under the above-described credit facilities.
27
Item 3. Quantitative and Qualitative
Disclosures About Market Risk
Interest Rate Risk
There have been no material changes in our exposure to interest rate risk during the nine months ended September 30, 2025 from what we reported in our 2024 Annual Report on Form 10-K. For additional information on our interest rate risk, refer to “Quantitative and Qualitative Disclosures about Market Risk” included in Part II, Item 7A in our 2024 Annual Report on Form 10-K.
Currency Risk
There have been no material changes in our exposure to currency risk during the nine months ended September 30, 2025 from what we reported in our 2024 Annual Report on Form 10-K. For additional information on our currency risk, refer to “Quantitative and Qualitative Disclosures about Market Risk” included in Part II, Item 7A in our 2024 Annual Report on Form 10-K.
Item 4. Controls and
Procedures
The term “disclosure controls and procedures” is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the Act). The rules refer to the controls and other procedures designed to ensure that information required to be disclosed in reports that we file or submit under the Act is (1) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (2) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. As of September 30, 2025, management, including our CEO and CFO, performed an evaluation of the effectiveness of our disclosure controls and procedures. Based on that evaluation, management, including our CEO and CFO, concluded that as of September 30, 2025, our disclosure controls and procedures were effective.
We maintain a system of internal control over financial reporting that is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Based on the most recent evaluation, we have concluded that no change in our internal control over financial reporting occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
The effectiveness of our system of disclosure controls and procedures or internal control over financial reporting is subject to certain limitations, including the exercise of judgment in designing, implementing and evaluating such systems, the assumptions used in identifying the likelihood of future events and the inability to eliminate misconduct completely. As a result, there can be no assurance that our control systems will detect all errors or fraud. By their nature, our system can provide only reasonable assurance regarding management's control objectives.
28
PART II. OTH
ER INFORMATION
Item 1. Legal
Proceedings
From time to time, we are subject to various claims and litigation arising in the ordinary course of business, including product liability, personal injury, commercial, contract and employment matters. While the outcome of any litigation is inherently unpredictable, based on currently available facts and our current insurance coverages, we do not believe that the ultimate resolution of any of these matters will have a material adverse impact on our financial condition, results of operations or cash flows.
Item 1A. Risk
Factors
Our operations and financial results are subject to various risks and uncertainties, which could adversely affect our business, financial condition or future results. We urge you to carefully consider (i) the other information set forth in this report and (ii) the risk factors discussed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to our risk factors from those disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024.
Item 2. Unregistered Sales of Equity Se
curities and Use of Proceeds
The table below summarizes the repurchases of our common stock in the third quarter of 2025:
Period
Total Number
of Shares
Purchased
(1)
Average Price
Paid per Share
Total Number of
Shares Purchased
as Part of Publicly
Announced Plan
(2)
Maximum Approximate
Dollar Value of Shares
That May Yet be
Purchased
Under the Plan
(2)
July 1-31, 2025
—
$
—
—
$
515,684,868
August 1-31, 2025
—
$
—
—
$
515,684,868
September 1-30, 2025
10,551
$
306.69
8,861
$
512,986,230
Total
10,551
$
306.69
8,861
(1)
Includes 1,690 shares of our common stock surrendered to us during the third quarter of 2025 by employees in order to satisfy minimum tax withholding obligations in connection with certain exercises of employee stock options or lapses upon vesting of restrictions on previously restricted share awards, and/or to cover the exercise price of such options granted under our share-based compensation plans.
(2)
In April 2025, our Board authorized an additional $309.2 million under our share repurchase program for the repurchase of shares of our common stock in the open market at prevailing market prices bringing the total authorization available under the program to $600.0 million. As of October 24, 2025, $493.2 million of the authorized amount remained available for use under our current share repurchase program. The share repurchase program does not obligate us to acquire any specific amount of shares and does not have an expiration date.
Our Board may declare future dividends at their discretion, after considering various factors, including our earnings, capital requirements, financial position, contractual restrictions and other relevant business considerations. For a description of restrictions on dividends in our Credit Facility and Term Facility, see the “Liquidity and Capital Resources” section of Management’s Discussion and Analysis in Part I, Item 2 of this Form 10-Q. We cannot assure shareholders or potential investors that dividends will be declared or paid any time in the future if our Board determines that there is a better use of our funds.
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Item 5. Other
Information
Amended and Restated Officer Employment Agreements
Effective on October 27, 2025, the Compensation Committee of the Company’s Board of Directors approved the amendment and restatement of the employment agreements (the Prior Agreements) in place with the Company’s named executive officers (the Amended Agreements). The principal terms of the Amended Agreements are substantially similar to the Prior Agreements but include an additional benefit providing for potential severance benefits in connection with a termination without Cause or with Good Reason within two years following a Change in Control (as such terms are defined in the Amended Agreements). Specifically, in connection with such a termination, (i) Mr. Arvan, the Company’s chief executive officer, will receive his base salary for a period of one hundred four weeks, and each of our other named executive officers will receive his or her base salary for a period of seventy-eight weeks, (ii) the executive will be eligible for certain welfare benefits for a period of eighteen months, and (iii) the executive will receive his or her target bonus for the year of termination. These benefits are conditioned on the executive’s continued compliance with the restrictive covenants set forth in the Amended Agreements. In all other material respects, the Amended Agreements are otherwise substantially similar to the Prior Agreements.
The foregoing description of the Amended Agreements does not purport to be complete and is subject to, and qualified in its entirety by, the description of the Prior Agreements contained in the Company’s full text of the Amended Agreements, a form of which is attached to this Form 10-Q as Exhibit 10.3 and incorporated by reference herein.
Trading Plans
During the quarter ended September 30, 2025
, none of our directors or officers (as defined in Rule 16a-1(f) under the Exchange Act)
adopted
or
terminated
any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408(a) of Regulation S-K).
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Item 6.
Exhibits
Exhibits filed as part of this report are listed below.
Fourth Amended and Restated Credit Agreement dated July 10, 2025, by and among Pool Corporation, as U.S. Borrower, SCP Distributors Canada Inc., as Canadian Borrower, SCP International, Inc., as Euro Borrower, Wells Fargo Bank, National Association, as Administrative Agent, and certain other lenders party thereto.
Fourth Amendment to Credit Agreement dated July 10, 2025, by and among Pool Corporation, as Borrower, the guarantors party thereto, and Bank of America, N.A., as lender.
Certification by Chief Financial Officer pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Certification by Chief Executive Officer pursuant to Rule 13a-14(a) and 15d‑14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Certification by Chief Executive Officer and Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
X
101.INS
+
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)
X
31
+ Attached as Exhibit 101 to this report are the following items formatted in iXBRL (Inline Extensible Business Reporting Language):
1.
Consolidated Statements of Income for the three and nine months ended September 30, 2025 and September 30, 2024;
2.
Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2025 and September 30, 2024;
3.
Consolidated Balance Sheets at September 30, 2025, December 31, 2024 and September 30, 2024;
4.
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and September 30, 2024;
5.
Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2025 and September 30, 2024; and
6.
Notes to Consolidated Financial Statements.
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SIGN
ATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on October 29, 2025.
POOL CORPORATION
By:
/s/ Melanie Housey Hart
Melanie Housey Hart
Senior Vice President and Chief Financial Officer, and duly authorized signatory on behalf of the registrant
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