Third Quarter 2024 Earnings
August 7, 2024
Third Quarter 2024
Earnings Call
Mike Egeck
Chief Executive Officer
Scott Bowman
Chief Financial Officer
: LESL
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Our Mission
As the trusted leader in pool and spa care, we are committed to delivering unparalleled expertise, service, and innovative solutions
Backyard moments that
become memories
Purpose
Consumer
Need
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Pride and joy in the pool |
Core |
Get it right |
Here to serve |
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Beliefs |
Make it easy |
Have some fun |
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A clean, safe, and beautiful pool |
Leslie's |
Trusted pool expertise and products |
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Solution |
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Leslie's is the largest and most trusted direct-to-consumer brand in the advantaged pool and spa industry
Pool & Spa Care Industry
Large & Fragmented Market: 14M+ bodies of water / $15B+ TAM
Consistent Growth: The installed base of pools has grown each year for 50+ years
Annuity-likeDemand: Predominately non- discretionary products
Favorable Dynamics: Continued investment in the home and migration to the sunbelt
1,000+ locations, more than our 20 largest competitors combined
80% of U.S. pools are within 20 miles of a
Leslie's location
Digital sales ~5x our largest competitor
National, customer-centricloyalty program
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Third Quarter Key Takeaways
Reported fiscal Q3 2024 results met the Company's revised guidance
- July 17th guidance revision reflected cold and wet weather in April and May
- Performance improved in June with warm and dry weather
Outperformed industry sales and gained share in Q3
Delivered chemical sales growth as weather improved
- Down 1% for the quarter
- Up 5% in June
- Volumes are now positive year-to-date
Reduced inventory by 31% or $134 million year-over-year
- Maintained high levels of in-stock and strong NPS scores
Focused on initiatives to help drive long term profitability and shareholder value as industry consumer demand normalizes
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Third Quarter 2024 Results
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(7)% |
Sales of $570M |
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Includes (230)bps headwind from |
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Sales change |
June 2023 chemical price actions |
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Comp sales: (7)% |
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40% |
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Gross Profit of $229M |
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Gross margin |
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Year-over-year change in gross |
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profit: (9)% |
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• |
Gross margin rate contracted (101) |
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bps vs. prior year quarter |
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Adj. EBITDA1 of $109M
• Adj. EBITDA1 lower by $20M vs. prior year quarter
Adj. EPS1 of $0.34
• Compared to $0.41 a year ago
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PRO Pool |
Residential Pool |
Residential Hot Tub |
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(2)% |
(8)% |
(4)% |
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Sales change |
Sales change |
Sales change |
Key Updates
- Total sales (7)% driven by:
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- Transactions (2)% and Average Order Value (5)%
- Customer File flat and Average Revenue per Customer (7)%
- Non-discretionarysales (6)%
- Discretionary sales (10)%
- Chemical sales (1)%, including a (440)bps impact from the June 2023 chemical price actions
- Equipment sales (15)%
- Inventory (31)% or $134M
- Unfavorable weather across non-seasonal and seasonal markets
- Traffic declined 5% year-over-year driven by unfavorable weather
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3Q FY2 0 24 |
Note: Unless otherwise stated, all comparisons are relative to the prior year period |
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1 See Appendix for reconciliation of non-GAAP measures to the most directly comparable GAAP measures |
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EARNINGS |
Sales Bridge - Third Quarter 2024 versus Prior Year
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3Q FY2 0 24 |
8 |
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EARNINGS |
Adjusted EBITDA Bridge - Third Quarter 2024 versus Prior Year
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3Q FY2 0 24 |
9 |
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EARNINGS |
Strategic Growth Initiatives Update
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Third Quarter 2024 Update |
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Grow Our |
• Third quarter customer file improved to flat year-over-year as file growth stabilizes post-pandemic |
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Consumer File |
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Deepen Customer |
• Average revenue per customer declined 7% year-over-year |
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• Average revenue per customer for loyalty members outperformed, down 4% year-over-year |
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Relationships |
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• 4,254 PRO Partner contracts in place, up 15% versus a year ago |
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The PRO Market |
• 108 PRO locations, up 10% versus a year ago |
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• Leslie's PRO website supporting PRO Partners |
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Location Growth |
• Opened 13 new stores year-to-date; on track to open 15 new stores in fiscal 2024 |
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Disruptive |
• AccuBlue Home® smart tech water testing device gaining momentum with great customer feedback |
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Innovation |
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3Q FY2 0 24 |
10 |
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EARNINGS |
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Disclaimer
Leslie's Inc. published this content on 07 August 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 07 August 2024 20:58:36 UTC.
