Pool Corporation

Good day and welcome to the Poole Corporation second quarter 2026 conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad, and to withdraw your question, please press star then two. We do ask that you please limit yourself to one question and one follow-up. Please also note, today's event is being recorded. I'd now like to turn the conference over to Kristen Byers, Director of Investor Relations. Please go ahead.

Welcome to our second quarter 2026 earnings conference call. During today's call, our discussion, comments, and responses to questions may include forward-looking statements, including management's outlook for 2026 and future periods. Actual results may differ materially from those discussed today. Information regarding the factors and variables that could cause actual results to differ from projected results are discussed in our 10-K. In addition, we may make references to non-GAAP financial measures in our comments. A description, reconciliation of non-GAAP financial measures are included in our press release or posted on our corporate website in the investor relations section. Additionally, we have provided a presentation summarizing key points from our press release and today's call, which can also be found on our investor relations website. I am now pleased to introduce John Watwood, our president and CEO, who will begin today's call.

Thanks, Kristen. Good morning, everyone, and thank you for joining our call. Before we cover the first of the quarter, I first want to thank our employees for the tireless efforts and their dedication to our customers day in and day out, especially during these critical pool season months. I also want to take a moment, as this is my first earnings call as Pool Corp CEO, to share my perspective on our business and where we are headed. I came into Pool Corp with a deep appreciation for what makes distribution businesses successful. Branch-level execution, strong supplier partnerships, technical sales expertise, disciplined inventory and service-level management, and seamless coordination across local markets. These capabilities have supported Pool Corp's value proposition for more than 30 years and provide us a strong foundation for continued growth. Additionally, the structural drivers of Pool Corp's business model are powerful. a large installed base of pools that naturally grows each year and generates recurring revenues from ongoing maintenance and periodic remodel activities, a professional customer base that depends on our scale and service, and a distribution network that is difficult to replicate. With our eyes set on crisp execution, I believe we can continue to generate above-market growth and control how we respond to any type of industry backdrop. Our fundamental strategy is unchanged. We aim to be the best worldwide distributor of outdoor lifestyle products by growing our share with our customers, building density in our network, and executing consistently across every market we serve. Our products must be on the shelves when the customer walks in the door and when it comes down to service, supplier relationships, and operational discipline. Every investment and initiative we make has to support the customer experience Strengthen supplier relationships, improve productivity, and generate an appropriate return. If it doesn't, we don't do it, and where it does, we will invest with discipline. To deliver on that strategy, we are focused on four priorities, each built to grow the business. First, sales excellence. Our growth starts with serving our customers better than anyone else. We are equipping our sales teams with the talent, training, and tools to help our existing customers grow their business with us and to broaden our reach to new customers. Our digital platform, our proprietary products, and the expertise in every sales center are how we deliver that value. When we make our customers more successful, we capture share and we grow. Second, pricing and supply chain discipline. pricing sharply and competitively, running strong chemical and building materials playbooks, and growing our private label of proprietary brands, which deepen customer loyalty and strengthen our margins. Third, operational execution. Running our sales centers with speed and consistency, holding a high service standard across all 455 locations, and getting our recently opened greenfields to their full potential. And fourth, growth through disciplined M&A. adding density, new markets, and capabilities where the operational and financial fit is clear. Together, these four priorities are how we drive profitable growth, widen our competitive advantages, and create long-term value for our shareholders. None of this works without our people. At every level of the organization, our team should know what's expected of them, understand how their work matters, and feel empowered to serve our customers. Over the last six months, I've spent significant time in the field with our operators, customers, and suppliers, met with employees across various functions, levels, and locations, and more recently with our shareholders. Everything I've seen and heard confirms what excited me about joining PoolCorp. This is a great business built by passionate employees, the best suppliers, and hundreds of thousands of customers who trust us to service and partner with them. I am proud to lead Pooled Corp's global team of employees as we work to deliver even higher levels of performance. Now, I'll discuss how the business performed during the quarter and Melanie will take you through the financial detail. Net sales grew 2% in the second quarter, a result that reflects the resilience of our model as strength in our reoccurring maintenance business and continued share gains in building materials offset a soft new construction and discretionary environment. Where we serve our customers best, we win. Our large and growing installed base drove healthy, recurring maintenance demand, building materials grew 4%, and that outperformance reflects our national pool trend showrooms, our product breadth, and the way our teams help builders bring their projects to life. Our proprietary and private label offerings continue to gain traction, and Pool360 reached 18% of sales, deepening how our customers engage with us and extending our reach. In Europe, Sales grew 11% on strong demand and improving sentiment. The softness we saw was concentrated where the cycle is weakest. New pool construction stayed muted as U.S. pool permits are tracking down low single digits year-to-date, and discretionary demand remained measured, felt most in our year-round markets. Our overall sales in California, Texas, and Arizona were down mid-single digits, and Florida declined 1%. Much of that drag was our horizon irrigation and landscape business, which is concentrated in those markets and saw further pressure as residential projects slowed. Our seasonal markets, by contrast, grew 6%. Equipment grew 3% on price and repair-related demand, while chemicals declined 2% on pricing. Sales to retail customers were down 1%, and pinch-a-penny franchise sales were flat. On gross margin, higher inbound freight was the primary pressure, and it's an area we're actively working to offset. Melanie will cover the additional details behind our gross margin performance and implications to the full year. Consistent with our productivity first posture, we remain deliberate on network expansion, adding one location in a key U.S. pool market, and closing one horizon location. The greenfields we've opened over the past year continue to ramp, and their performance is improving. The class of 2022 and the remaining classes are trending in the right direction, but we still have room to grow as these locations mature. Across the rest of our network, ongoing process improvements and the continued adoption of our digital tools remain a focus for driving efficiency and productivity and getting more from the investments we've already made. Taken together, The quarter reinforces our strategy and our confidence, and we remain on track to achieve our adjusted earning guidance range of $10.87 a share to $11.17 a share. In closing, I would like to emphasize how honored I am to lead the Pool Corp team and generate further value from the fundamentals of our business and the investments put in place over the past several years. We compete in large markets with recurring, repeat demand, and I don't take for granted the advantages we have built to serve them. A distribution network that's hard to replicate, supplier relationships built over decades, and one of the broadest product assortments in the industry. We are continually investing in the tools and services that make it simpler for customers to grow their businesses with us, and we are doing that from a position of financial flexibility with ample capital available to reinvest. positioning us to emerge stronger as the cycle recovers. I'm grateful to our employees, suppliers, and customers for the solid foundation they have built. I will now turn the call over to Melanie Hart, our Chief Financial Officer, to review our second quarter results in more detail.