Latham Q3 2026 Sales Rise 12.5% on Fiberglass Growth

Latham Group (SWIM) reported a 12.5% increase in fiscal third-quarter net sales as fiberglass pools drove strong growth in its in-ground pool business, while higher production volumes and manufacturing efficiencies lifted profitability. The company also narrowed its full-year sales and adjusted EBITDA guidance around unchanged midpoints.

Net sales for the quarter ended September 26 rose to $182.2 million from $161.9 million a year earlier. Organic sales increased 8.4%, indicating that acquisitions contributed part of the reported growth.

GAAP net income increased to $12.1 million, or 6.6% of sales, from $8.1 million and 5.0% a year earlier. Adjusted EBITDA rose to $45.3 million from $38.3 million, while adjusted EBITDA margin expanded 110 basis points to 24.8%.

Gross margin improved 130 basis points to 36.7%. Latham attributed the expansion to better plant absorption from higher volumes, along with benefits from lean manufacturing and value-engineering initiatives. Those gains more than offset increased sales and marketing spending intended to support the company’s growth strategy.

For the first three quarters of fiscal 2026, net sales increased 11.4% to $497.0 million, including organic growth of 7.9%. Adjusted EBITDA reached $102.0 million, compared with $89.4 million in the prior-year period, and adjusted EBITDA margin rose 50 basis points to 20.5%. GAAP net income was $16.3 million, down from $18.1 million a year earlier.

Fiberglass pools lead product growth

Third-quarter in-ground pool sales increased 22.6%, or 13.9% organically, with the growth driven almost entirely by fiberglass pools. Year-to-date in-ground pool sales were up 17.4%, including 9.9% organic growth.

Pool cover sales increased 8.7% in the quarter and 8.4% year to date. The company said automatic safety covers and revenue synergies from earlier Coverstar acquisitions supported the gains.

Sales in the Sand States—Florida, Texas, Arizona and California—rose 21.1% in the third quarter and 16.6% over the first three quarters, led by Florida and Texas. These markets remain a central part of Latham’s strategy to increase the adoption of fiberglass pools as an alternative to concrete.

Latham said it added field sales resources in Florida and plans further expansion in Texas and Arizona. The company also appointed a new chief commercial officer and added leaders in sales strategy and operations. Year-to-date consumer leads increased 25%, while website traffic rose 11%.

As part of its local market-development efforts, Latham held three community events in Florida during the quarter that generated 15 pool sales. It is also working with a national homebuilder to offer Latham fiberglass pools in Florida, with one pool installed at a model home.

Full-year outlook narrowed around unchanged midpoints

Latham now expects 2026 net sales of $605 million to $615 million, compared with its previous range of $600 million to $620 million. The revised range retains a midpoint of $610 million, representing projected year-over-year growth of 11.7%.

The company narrowed its adjusted EBITDA outlook to $112 million to $118 million from $110 million to $120 million. The $115 million midpoint is also unchanged and implies 15.2% growth.

Capital expenditure guidance remains $40 million to $45 million. The forecast includes the purchase of four production sites and the acquisition of Freedom Pools.

Management is forecasting that new U.S. pool starts in 2026 will be approximately flat with 2025, making product conversion, geographic expansion, replacement demand and operating efficiencies important components of Latham’s growth plans. Its broader strategy also includes expanding the automatic-cover business and pursuing acquisitions that add revenue synergies or extend its geographic reach.

At September 26, Latham reported $292.5 million of total debt and $94.8 million of cash, resulting in net debt of $197.7 million. Its net debt leverage ratio was 1.8 times based on last-12-month adjusted EBITDA of $112.5 million.

The outlook reflects management’s expectations as of November 3, 2026. Latham cautioned that actual performance could differ materially because of risks described in its regulatory filings and earnings release. The forward-looking statements also do not incorporate the potential effects of future acquisitions, mergers, dispositions, joint ventures or investments.