Hayward Holdings Reports 3.3% Revenue Growth, Net Income Increase in Q3 2024

Hayward Holdings, Inc. reported a solid performance for the third quarter and the first nine months of fiscal 2024, with net sales reaching $227.6 million for the three months ended September 28, 2024, a 3.3% increase from $220.3 million in the same period of the previous year. For the nine months, net sales totaled $724.5 million, up 1.5% from $714.0 million. The growth was primarily driven by a 5.6% increase in pricing, net of discounts, although this was partially offset by a decline in sales volume due to market conditions in the Middle East and Asia, as well as reduced new construction and remodeling activity in the U.S.

Gross profit for the third quarter increased to $113.1 million, a 7.3% rise from $105.4 million, resulting in a gross profit margin of 49.7%, up from 47.8%. For the nine-month period, gross profit was $362.8 million, compared to $339.8 million, with a margin increase to 50.1% from 47.6%. Operating income also saw significant growth, reaching $33.4 million for the third quarter, up from $28.9 million, and $132.3 million for the nine months, compared to $119.7 million.

Net income for the third quarter was $16.5 million, an increase from $11.8 million in the prior year, while for the nine months, net income rose to $63.9 million from $49.7 million. The earnings per share for the third quarter were $0.08, up from $0.06, and for the nine months, it was $0.30 compared to $0.23.

The company’s strategic developments included the acquisition of ChlorKing HoldCo, LLC for $61.6 million, which is expected to enhance its product offerings. The acquisition was funded through cash on hand and incurred transaction expenses of $0.7 million in the third quarter.

Financially, Hayward improved its liquidity position, with cash and cash equivalents increasing to $274.2 million as of September 28, 2024, from $178.1 million at the end of 2023. The company also made significant progress in reducing its long-term debt, which decreased to $959.9 million from $1.1 billion at the end of 2023, following a voluntary prepayment of $123.1 million on its Incremental Term Loan B.

Despite these positive developments, the company faced challenges, including increased warranty expenses and rising selling, general, and administrative expenses, which grew by 8.5% in the third quarter compared to the previous year. The effective tax rate for the third quarter was 21.1%, up from a tax benefit of 23.7% in the prior year, reflecting a shift in tax obligations.

Overall, Hayward Holdings, Inc. demonstrated resilience in its financial performance amid market fluctuations, supported by strategic acquisitions and effective cost management.