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POOL CORP

POOL
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Business Summary

Pool Corporation operates in the outdoor living industry, which services more than 14.0 million swimming pools and hot tubs in the United States alone, including approximately 5.5 million in-ground swimming pools . The industry has experienced long-term growth driven by favorable demographic and socioeconomic trends such as population migration toward the southern United States, increased homeowner spending on outdoor living spaces, healthy home equity levels, and increased demand for automation and sustainable, energy-efficient products. Based on industry data, the company estimates that new in-ground pool construction units decreased 3% to 5% from 62,000 units in 2024 to just below 60,000 units in 2025 , primarily due to cautious consumer discretionary spending and elevated financing costs. The company believes that the installed base of swimming pools generates recurring revenue, with approximately 64% of sales from recurring maintenance and minor repair of existing pool installations, 22% from pool remodeling, renovations and upgrades, and 14% from new pool construction .

Pool Corporation is the world's largest wholesale distributor of swimming pool supplies, equipment and related leisure products and is one of the leading distributors of irrigation and landscape maintenance products in the United States. The company faces intense competition from many regional and local distributors and from a limited number of other national wholesale distributors, as well as from mass market retailers and large pool supply retailers. The company's largest suppliers include Pentair plc, Zodiac Pool Systems, Inc. and Hayward Holdings, Inc., which accounted for approximately 20%, 12% and 11%, respectively, of the cost of products sold in 2025 . The company believes its competitive advantages include the breadth and availability of products offered, the quality and level of customer service, the availability of sales and marketing programs, consistency and stability of business relationships, competitive product pricing, and geographic proximity to the customer. The company's primary markets with the highest concentration of swimming pools are California, Florida, Texas and Arizona, collectively representing approximately 53% of 2025 net sales .

Pool Corporation generates revenue by distributing swimming pool supplies, equipment and related leisure products, irrigation and landscape maintenance products, and hardscapes, tile and stone products to a customer base that generally includes pool builders, pool service companies, retail stores, commercial pool operators and landscape contractors. The company operates through five distribution networks: SCP Distributors, Superior Pool Products, Horizon Distributors, National Pool Trends (NPT), and Sun Wholesale Supply. The company serves approximately 125,000 customers , the majority of whom are small, entrepreneurial, family-owned businesses, and no single customer represents 10% or more of 2025 sales . The company's business model is characterized by a mix of recurring maintenance revenue and transactional income from remodeling and new construction, with approximately 64% of sales from recurring maintenance and minor repair, 22% from remodeling and renovations, and 14% from new pool construction .

Pool Corporation offers more than 200,000 manufacturer, proprietary and exclusive brand products across over 700 product lines and approximately 40 product categories . The company sells pool maintenance products such as chemicals, supplies and pool accessories; repair and replacement parts for pool equipment including cleaners, filters, heaters, pumps and lights; building materials such as concrete, plumbing and electrical components, pool surfaces, decking materials, tile, hardscapes and natural stone; pool equipment and components for new construction and remodeling; irrigation and related products including system components and professional turf care equipment; commercial pool products including safety equipment and commercial pumps and filters; fiberglass pools and hot tubs and packaged pool kits; and other pool construction and recreational products such as grills and components for outdoor kitchens. Sales for the pool and hot tub chemicals product category represented approximately 14% of total net sales in 2025, 15% in 2024 and 14% in 2023 . No other product categories accounted for 10% or more of total net sales in any of the last three fiscal years .

The company's NPT network primarily serves the swimming pool market with pool tile and composite pool finish products and also serves the irrigation and landscape industry through NPT hardscapes and other outdoor living products. In addition to 19 dedicated NPT sales centers , the company operates 124 SCP and Superior sales centers featuring consumer showrooms . Sun Wholesale Supply distributes swimming pool supplies, equipment and related leisure products, primarily servicing independently owned and operated Pinch A Penny franchise locations, and also owns and operates a specialty chemical re-packaging plant that sells proprietary pool chemical products principally to the Pinch A Penny franchised store network and also provides chemical products to the SCP and Superior networks. The company considers the commercial market to be a key growth opportunity and in 2025 designated four commercial warehouses throughout the country to serve these customers more efficiently .

During 2025, the company opened 8 new sales centers, consolidated or closed 3 sales centers, and acquired 3 locations . The company acquired Great Plains Supply and Spa Products in Kansas in August 2025, Porpoise Pool & Patio, Inc. in October 2025, and Vegas Stone Brokers in Nevada in October 2025 . The company repurchased 739,315 shares of common stock as part of its publicly announced plan during the fourth quarter of 2025 at an average price of $246.31 per share . In April 2025, the Board authorized an additional $309.2 million under the share repurchase program, bringing the total authorization available to $600.0 million . As of February 20, 2026, $331.0 million of the authorized amount remained available for use . The company paid $184.9 million in quarterly cash dividend payments to shareholders during 2025 . The company also refinanced its credit facilities during the year, entering into a Fourth Amended and Restated Credit Agreement on July 10, 2025 .

Net sales for 2025 were $5,289.4 million , comparable to $5,311.0 million in 2024. Gross margin was 29.7% in both 2025 and 2024, though 2024 gross margin included a 20 basis points benefit from the reversal of $12.6 million for estimated import taxes. Operating income was $580.2 million in 2025, down 6% from $617.2 million in 2024. Net income decreased to $406.4 million in 2025 compared to $434.3 million in 2024. Earnings per diluted share declined 4% to $10.85 in 2025 compared to $11.30 in 2024. Net cash provided by operations was $365.9 million in 2025. Total debt outstanding of $1.2 billion at December 31, 2025 increased $249.1 million compared to December 31, 2024, primarily to fund open market share repurchases of $341.1 million in 2025 and working capital needs.

Business Outlook

Management expects sales to be a low single digit increase compared to 2025, impacted by normal weather patterns for 2026, slight growth in sales of pool maintenance products, consistent new construction units to 2025, flat to slightly up renovation and remodel activity, inflationary product cost increases of approximately 1% to 2% , and the same number of selling days each quarter compared to 2025. The company projects gross margin for the full year of 2026 to be similar to the 2025 gross margin of 29.7% . The company projects that 2026 earnings will be in the range of $10.85 to $11.15 per diluted share . The 2026 guidance does not include any estimated unrealized tax benefits related to stock option exercises, stock option expirations or restricted stock awards vesting in 2026. The company expects its effective tax rate will be around 25% without the impact of ASU 2016-09.

The company plans to broaden its geographic presence by opening 5 to 8 new sales centers in 2026 and by making selective acquisitions if and when appropriate opportunities arise. The company expects to continue to realize sales growth through market share gains and continued expansion of product offerings with a focus on proprietary and exclusive brands such as Regal, E-Z Clor, SuperPro and PoolStyle lines. The company plans to continue expanding its POOL360 technologies to provide additional resources for customers, including POOL360 WaterTest and POOL360 PoolService mobile applications that link into the POOL360 B2B platform. The company also plans to continue to make strategic acquisitions and open new sales centers to further penetrate existing markets and expand into both new geographic markets and new product categories.

The company expects to leverage its existing infrastructure and strategically manage discretionary spending. The company projects that operating expenses in 2026 will be impacted by an increase of approximately $10.0 million to $15.0 million as performance-based compensation normalizes, $5.0 million of spend to add greenfields to the sales center network, utilization of technological solutions to enhance capacity creation, inflationary increases in areas such as labor and occupancy costs with some offsets from efficiency initiatives, and leverage from enhanced profitability efforts at recent greenfield locations.

The company projects capital expenditures for 2026 will be approximately 1% to 1.5% of net sales . The company expects to continue to use cash for the payment of dividends as and when declared by the Board and to fund opportunistic share repurchases at its discretion over the next year. As of February 20, 2026, $331.0 million remained available to purchase shares of common stock under the current Board-approved share repurchase plan program. The company expects to repurchase additional shares in the open market from time to time subject to market conditions, funded with cash provided by operations and borrowings under its credit and receivables facilities.

The company expects inflationary product cost increases to be approximately 1% to 2% in 2026 . The company expects write-offs as a percentage of net sales to approximate 0.10% of net sales in 2026 . The company expects that the geographic mix of approximately 95% of sales in North America, 4% in Europe and less than 1% in Australia will be similar over the next few years .

The company's outlook is based on reasonable expectations for industry demand, pricing and inflationary conditions, variable expense reductions, realization of digital transformation initiatives and leverage of existing investments in the business. The company bases its assumptions on normal weather conditions and does not incorporate alternative weather predictions into its guidance. The company notes that favorable weather positively impacts industry activity by accelerating growth, expanding the number of available construction days, extending the pool season and pool usage and positively impacting demand for discretionary products, while unfavorable weather typically impedes growth.

Risk Factors

The company faces material risks from adverse weather conditions, as weather is one of the principal external factors affecting the business; in 2025, the company generated 61% of net sales and 78% of operating income in the second and third quarters , and unfavorable weather during these quarters in the largest geographic regions can significantly affect results. The company is highly dependent on maintaining favorable relationships with suppliers, as the three largest suppliers—Pentair plc, Zodiac Pool Systems, Inc. and Hayward Holdings, Inc.—accounted for 20%, 12% and 11%, respectively, of the cost of products sold in 2025 , and a decision by these suppliers to sell directly to end users would have an adverse effect. The company faces intense competition in its four largest markets of California, Florida, Texas and Arizona, which represented approximately 53% of net sales in 2025 , and the entry of significant new competitors into these markets could negatively impact sales. The cost of servicing variable rate debt could reduce profitability if interest rates remain elevated; as of December 31, 2025, the company had $1.2 billion in total debt with variable interest rates on portions not covered by interest rate swap contracts, and a sensitivity analysis showed that a 1.0% increase in variable interest rates would decrease pretax income by approximately $13.7 million and earnings per share by approximately $0.27 per diluted share .

Management Priorities

Management's message emphasizes that the company is well positioned to benefit from inherent long-term growth opportunities in the industry fueled by favorable population migration trends, product developments and technological advancements as consumers focus on more sustainable and energy-efficient products. Management notes that during the COVID-19 pandemic from 2020 through 2022, the company experienced unprecedented demand, but beginning in the latter half of 2022, these trends moderated resulting in lagging new pool construction and remodeling activities. Management highlights that full-year 2025 results include a fifth consecutive year of sales exceeding $5.0 billion, diluted earnings per share of $10.85 and double-digit operating margin. Management's strategic priorities for the period ahead include broadening geographic presence by opening 5 to 8 new sales centers in 2026 , making selective acquisitions, and continuing to invest in digital transformation and technology to provide best-in-class service to customers. Management projects that 2026 earnings will be in the range of $10.85 to $11.15 per diluted share .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Our Industry
  2. [2] Item 7, MD&A — Current Trends and Outlook
  3. [3] Item 1, Business — Our Industry
  4. [4] Item 1, Business — Purchasing and Suppliers
  5. [5] Item 1, Business — Customers and Products
  6. [6] Item 1, Business — Customers and Products
  7. [7] Item 1, Business — Customers and Products
  8. [8] Item 1, Business — Our Industry
  9. [9] Item 1, Business — Customers and Products
  10. [10] Item 1, Business — Customers and Products
  11. [11] Item 1, Business — Customers and Products
  12. [12] Item 1, Business — Customers and Products
  13. [13] Item 1, Business — Operating Strategy
  14. [14] Item 1, Business — Operating Strategy
  15. [15] Item 1, Business — Customers and Products
  16. [16] Item 2, Properties
  17. [17] Item 2, Properties; Item 8, Note 2 — Acquisitions
  18. [18] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  19. [19] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  20. [20] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  21. [21] Item 7, MD&A — 2025 Financial Overview
  22. [22] Item 7, MD&A — Liquidity and Capital Resources
  23. [23] Item 8, Consolidated Statements of Income
  24. [24] Item 8, Consolidated Statements of Income
  25. [25] Item 7, MD&A — Results of Operations
  26. [26] Item 7, MD&A — 2025 Financial Overview
  27. [27] Item 8, Consolidated Statements of Income
  28. [28] Item 8, Consolidated Statements of Income
  29. [29] Item 8, Consolidated Statements of Income
  30. [30] Item 8, Consolidated Statements of Income
  31. [31] Item 8, Consolidated Statements of Income
  32. [32] Item 8, Consolidated Statements of Income
  33. [33] Item 8, Consolidated Statements of Cash Flows
  34. [34] Item 7, MD&A — 2025 Financial Overview
  35. [35] Item 7, MD&A — 2025 Financial Overview
  36. [36] Item 7, MD&A — 2025 Financial Overview
  37. [37] Item 7, MD&A — Current Trends and Outlook
  38. [38] Item 7, MD&A — Current Trends and Outlook
  39. [39] Item 7, MD&A — Current Trends and Outlook
  40. [40] Item 7, MD&A — Current Trends and Outlook
  41. [41] Item 7, MD&A — Current Trends and Outlook
  42. [42] Item 7, MD&A — Current Trends and Outlook
  43. [43] Item 7, MD&A — Current Trends and Outlook
  44. [44] Item 7, MD&A — Liquidity and Capital Resources
  45. [45] Item 5, Market for Registrant's Common Equity — Issuer Purchases of Equity Securities
  46. [46] Item 1, Business — Economic Environment
  47. [47] Item 7, MD&A — Critical Accounting Estimates — Allowance for Doubtful Accounts
  48. [48] Item 1, Business — Customers and Products
  49. [49] Item 1A, Risk Factors — Risks Relating to Our Business and Industry
  50. [50] Item 1A, Risk Factors — Risks Relating to Our Business and Industry
  51. [51] Item 1A, Risk Factors — Risks Relating to Our Business and Industry
  52. [52] Item 8, Consolidated Balance Sheets
  53. [53] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  54. [54] Item 7A, Quantitative and Qualitative Disclosures about Market Risk
  55. [55] Item 5, Market for Registrant's Common Equity — Stock Performance Graph
  56. [56] Item 7, MD&A — Current Trends and Outlook
  57. [57] Item 7, MD&A — Current Trends and Outlook
  58. [58] Item 8, Consolidated Statements of Income
  59. [59] Item 8, Consolidated Statements of Income
  60. [60] Item 8, Consolidated Statements of Income
  61. [61] Item 8, Consolidated Statements of Income
  62. [62] Item 8, Consolidated Statements of Income
  63. [63] Item 8, Consolidated Statements of Income
  64. [64] Item 8, Consolidated Statements of Income
  65. [65] Item 8, Consolidated Statements of Income
  66. [66] Item 8, Consolidated Statements of Income
  67. [67] Item 8, Consolidated Statements of Income
  68. [68] Item 8, Consolidated Statements of Income
  69. [69] Item 8, Consolidated Statements of Income
  70. [70] Item 7, MD&A — Results of Operations
  71. [71] Item 8, Consolidated Statements of Income
  72. [72] Item 8, Consolidated Statements of Income
  73. [73] Item 8, Consolidated Statements of Income
  74. [74] Item 7, MD&A — 2025 Financial Overview
  75. [75] Item 8, Consolidated Statements of Cash Flows
  76. [76] Item 8, Consolidated Statements of Cash Flows
  77. [77] Item 8, Consolidated Statements of Cash Flows
  78. [78] Item 8, Consolidated Balance Sheets
  79. [79] Item 8, Consolidated Balance Sheets
  80. [80] Item 7, MD&A — 2025 Financial Overview
  81. [81] Item 7, MD&A — 2025 Financial Overview
  82. [82] Item 7, MD&A — 2025 Financial Overview
  83. [83] Item 7, MD&A — 2025 Financial Overview
  84. [84] Item 7, MD&A — Critical Accounting Estimates — Impairment of Goodwill

Analysis on 6/9/2026