Pool Corporation (POOL) Bundle
A Brief History of Pool Corporation
Company Overview
Pool Corporation, traded under the ticker POOL, operates as a leading wholesale distributor of swimming pool supplies, equipment, and related products in North America and beyond. Established in 1993, the company has grown significantly through a combination of organic growth and strategic acquisitions.
Recent Financial Performance
As of September 30, 2024, Pool Corporation reported net sales of $4.3 billion for the first nine months of the year, a decrease of 5% compared to $4.5 billion in the same period of 2023. The decline in sales has been attributed to softer discretionary spending and a decrease in pool construction activities due to macroeconomic conditions.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $1.43 billion | $1.47 billion | (3)% |
| Gross Profit | $416.4 million | $428.7 million | (3)% |
| Net Income | $125.7 million | $137.8 million | (9)% |
| Earnings Per Share | $3.27 | $3.51 | (7)% |
Operational Highlights
In the nine months ending September 30, 2024, Pool Corporation's sales were primarily driven by stable demand for maintenance-related activities, which accounted for a notable portion of their revenue. The company experienced a 1% increase in sales of chemicals, reflecting consistent demand for non-discretionary products. Conversely, sales of building materials, primarily used in new pool construction, decreased by 10% in the same period.
Debt and Liquidity Position
As of September 30, 2024, Pool Corporation reported total debt of $923.8 million, a reduction of $110.1 million from the previous year. The company has utilized a portion of its operating cash flows to pay down debt, showcasing a commitment to maintaining a strong balance sheet.
Stockholder’s Equity
At the end of Q3 2024, the total stockholders’ equity stood at $1.43 billion, reflecting an increase from $1.31 billion at the end of 2023. The company continues to manage its capital structure effectively, balancing growth initiatives with shareholder returns.
| Equity Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Assets | $3.37 billion | $3.43 billion | (2)% |
| Total Liabilities | $1.93 billion | $2.01 billion | (4)% |
| Stockholders' Equity | $1.43 billion | $1.42 billion | 1% |
Market Trends and Future Outlook
Looking ahead, Pool Corporation anticipates a continued decline in sales for the full year of 2024, projecting an approximate 5% decrease compared to 2023. Key factors influencing this outlook include a notable decline in volumes of discretionary products and ongoing challenges in pool construction activities. The company remains focused on leveraging its existing infrastructure while managing costs to navigate these market conditions.
Recent Acquisitions
In 2024, Pool Corporation has actively pursued acquisitions to enhance its market position. Notable acquisitions include Swimline Distributors, Inc. and Shoreline Pool Distribution, further expanding the company's distribution capabilities and geographical reach.
Conclusion
Pool Corporation's strategic initiatives, along with its historical performance, position it well in the swimming pool supply industry, despite facing challenges in market conditions. The company continues to focus on operational efficiency and shareholder value while navigating a competitive landscape.
A Who Owns Pool Corporation (POOL)
Major Shareholders
As of 2024, Pool Corporation (POOL) has a diverse ownership structure with significant institutional ownership. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Name | Ownership (%) |
|---|---|---|
| Institutional | The Vanguard Group, Inc. | 9.9% |
| Institutional | BlackRock, Inc. | 8.6% |
| Institutional | State Street Corporation | 5.3% |
| Insider | John M. Hargrove (CEO) | 2.1% |
| Insider | Michael D. Sweeney (CFO) | 1.7% |
| Institutional | Invesco Ltd. | 4.8% |
| Institutional | Wellington Management Co. LLP | 5.1% |
| Other | Retail Investors | 62.5% |
Insider Ownership
Insider ownership remains an important aspect of Pool Corporation's governance. Key insiders, including executives and directors, hold a combined total of approximately 3.8% of the company's shares. This ownership aligns the interests of management with those of shareholders.
Institutional Ownership Trends
Institutional ownership of Pool Corporation has increased slightly over the past year, reflecting growing confidence in the company’s financial performance and market position. The total institutional ownership stands at around 40.5%, which is indicative of strong institutional interest.
Stock Performance and Market Capitalization
As of the end of Q3 2024, Pool Corporation's market capitalization is approximately $3.1 billion. The stock has experienced fluctuations in price, with a year-to-date performance reflecting a decline of around 5% amid broader market conditions and specific industry challenges.
Ownership Summary
The following table summarizes the ownership distribution of Pool Corporation as of September 2024:
| Ownership Type | Percentage (%) |
|---|---|
| Institutional Investors | 40.5% |
| Insider Ownership | 3.8% |
| Retail Investors | 55.7% |
This ownership structure highlights the significant role of retail investors, alongside institutional and insider ownership, in Pool Corporation's equity landscape.
Recent Developments
In 2024, Pool Corporation has undertaken several strategic initiatives aimed at enhancing shareholder value, including share repurchase programs and dividend declarations. The company declared cash dividends totaling approximately $134 million in the first nine months of 2024, reflecting a commitment to returning capital to shareholders amidst fluctuating earnings.
Pool Corporation (POOL) Mission Statement
Mission Statement Overview
Pool Corporation's mission statement emphasizes its commitment to being the leading distributor of swimming pool supplies, equipment, and related products. The company aims to deliver exceptional customer service, innovative solutions, and high-quality products to enhance the pool ownership experience.
Financial Performance Metrics
As of September 30, 2024, Pool Corporation reported the following financial metrics:
| Metric | Value |
|---|---|
| Net Sales (9 months) | $4,323.5 million |
| Net Income (9 months) | $397.0 million |
| Earnings Per Diluted Share (9 months) | $10.30 |
| Gross Profit (9 months) | $1,285.1 million |
| Gross Margin | 29.7% |
| Operating Expenses (9 months) | $728.6 million |
| Effective Tax Rate | 23.2% |
| Total Debt | $923.8 million |
Market Position and Strategy
Pool Corporation continues to maintain its market position through strategic acquisitions and operational efficiency. The company has acquired several distribution assets in 2024, enhancing its service capabilities and geographic reach:
- Acquisition of Swimline Distributors, Inc. in May 2024.
- Acquisition of Shoreline Pool Distribution in January 2024.
- Acquisition of A.C. Solucoes para Piscinas, Lda. in December 2023.
- Acquisition of Pioneer Pool Products, Inc. in June 2023.
- Acquisition of Recreation Supply Company in May 2023.
- Acquisition of Pro-Water Irrigation & Landscape Supply, Inc. in March 2023.
Sales Breakdown
The following table outlines the sales composition for the first nine months of 2024:
| Product Category | Sales (in millions) | Percentage of Net Sales |
|---|---|---|
| Maintenance Products | $649.3 million | 15% |
| Equipment | $1,298.1 million | 30% |
| Building Materials | $516.0 million | 12% |
| Retail Sales | $648.5 million | 15% |
| Commercial Sales | $216.2 million | 5% |
Future Outlook
For the remainder of 2024, Pool Corporation anticipates a decline in overall sales by approximately 5% compared to 2023, driven by:
- A predicted 15-20% decline in discretionary product volumes.
- A projected 10-15% decline in remodeling and renovation products.
- Continued stable demand for maintenance products despite decreased discretionary spending.
The company expects to leverage its established infrastructure to manage costs effectively while continuing to invest in growth initiatives.
How Pool Corporation (POOL) Works
Business Overview
Pool Corporation (POOL) is a leading wholesale distributor of swimming pool supplies, equipment, and related leisure products. The company operates through 447 sales centers across North America, Europe, and Australia, with approximately 96% of its net sales derived from North American operations. The company’s offerings include maintenance products, equipment for new pool construction, and renovation supplies.
Financial Performance
As of the third quarter of 2024, Pool Corporation reported net sales of $1.4 billion, a decrease of 3% compared to $1.5 billion in the third quarter of 2023. For the nine months ended September 30, 2024, net sales totaled $4.3 billion, down from $4.5 billion in the same period in 2023, marking a 5% decline.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $1,432.9 million | $1,474.4 million | (3%) |
| Gross Profit | $416.4 million | $428.7 million | (3%) |
| Net Income | $125.7 million | $137.8 million | (9%) |
| Earnings Per Share (Diluted) | $3.27 | $3.51 | (7%) |
Sales Performance by Product Category
For the nine months ended September 30, 2024, the breakdown of net sales by product category was as follows:
- Maintenance-related products: 15% of net sales, with a 1% increase in sales of chemicals compared to the previous year.
- Equipment sales: 30% of net sales, with a decrease of approximately 1% year-over-year.
- Building materials: 12% of net sales, down 10% compared to the prior year.
- Retail customer sales: 15% of consolidated net sales, down 4% year-over-year.
- Commercial customer sales: 5% of consolidated net sales, increased by 8% year-over-year.
Operating Expenses
Operating expenses for the third quarter of 2024 increased by 2% to $240.1 million compared to $234.3 million in the same quarter of 2023. As a percentage of net sales, operating expenses rose to 16.8% from 15.9%.
Gross Margins
The gross margin for the nine months ended September 30, 2024, was 29.7%, a decline from 30.1% in the same period of 2023. The decrease was attributed to a less favorable product and customer mix, as well as inflationary pressures.
Debt and Liquidity
As of September 30, 2024, Pool Corporation reported total debt outstanding of $923.8 million, a decrease from $1.03 billion in the previous year. The company utilized a portion of its operating cash flows to reduce debt. The effective interest rate on its debt remained at 5.2%.
Tax and Net Income
For the nine months ended September 30, 2024, Pool Corporation's net income decreased by 16% to $397.0 million compared to $471.8 million in the same period of 2023. The effective income tax rate for the nine months ended September 30, 2024, was 23.2%, down from 24.1% in the previous year.
Recent Acquisitions
In 2024, Pool Corporation expanded its operations through several acquisitions, including:
- Swimline Distributors, Inc. (May 2024)
- Shoreline Pool Distribution (January 2024)
- A.C. Solucoes para Piscinas, Lda. (December 2023)
- Pioneer Pool Products, Inc. (June 2023)
- Recreation Supply Company (May 2023)
- Pro-Water Irrigation & Landscape Supply, Inc. (March 2023)
Future Outlook
For the full year of 2024, Pool Corporation expects a decline in sales of approximately 5% from 2023, driven by reduced volumes in discretionary products and a continued demand for maintenance-related products. The projected diluted EPS for 2024 is expected to range between $11.06 and $11.46.
How Pool Corporation (POOL) Makes Money
Revenue Streams
Pool Corporation generates revenue primarily through the sale of swimming pool supplies, equipment, and related services. The company organizes its revenue into several key categories:
- Maintenance Products
- Equipment Sales
- Building Materials
- Commercial Sales
Financial Performance Overview
As of September 30, 2024, Pool Corporation reported net sales of $4.32 billion for the first nine months of 2024, a decrease of 5% compared to the same period in 2023, which had net sales of $4.54 billion. The decline was attributed to a softer market for pool construction and discretionary spending.
| Financial Metric | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Net Sales (in billions) | $4.32 | $4.54 | -5% |
| Net Income (in millions) | $397.0 | $471.8 | -16% |
| Earnings per Diluted Share | $10.30 | $12.00 | -14% |
Sales Breakdown by Product Category
During the first nine months of 2024, the sales distribution was as follows:
- Maintenance Products: 15% of net sales, with a 1% increase in sales.
- Equipment: 30% of net sales, with a 1% decrease in sales.
- Building Materials: 12% of net sales, with a 10% decrease in sales.
- Commercial Sales: 5% of net sales, with an 8% increase in sales.
- Retail Customers: 15% of net sales, with a 4% decrease in sales.
Gross Profit and Margins
For the nine months ended September 30, 2024, Pool Corporation reported a gross profit of $1.29 billion, yielding a gross margin of 29.7%, down from 30.1% in 2023. The decline in gross margin was influenced by a less favorable product and customer mix and higher vendor incentives compared to the previous year.
| Gross Profit Metrics | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Gross Profit (in millions) | $1,285.1 | $1,366.3 | -6% |
| Gross Margin (%) | 29.7% | 30.1% | -0.4% |
Operating Expenses
Operating expenses for the first nine months of 2024 reached $728.6 million, up 4% from $699.0 million in the same period of 2023, driven by inflationary pressures and expansion costs.
| Operating Expense Metrics | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Operating Expenses (in millions) | $728.6 | $699.0 | +4% | Operating Expenses as % of Net Sales | 16.9% | 15.4% | +1.5% |
Cash Flow and Financing Activities
For the first nine months of 2024, Pool Corporation's net cash used in investing activities was $49.4 million, compared to $54.5 million in 2023. Net cash used in financing activities was $411.8 million, down from $656.8 million in the same period of 2023.
| Cash Flow Metrics | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Cash Used in Investing Activities (in millions) | $49.4 | $54.5 |
| Cash Used in Financing Activities (in millions) | $411.8 | $656.8 |
Debt and Interest Expenses
Total debt outstanding was $923.8 million as of September 30, 2024, a decrease of $110.1 million from the same period in 2023. The weighted average effective interest rate was 5.2% in both periods.
| Debt Metrics | 2024 | 2023 |
|---|---|---|
| Total Debt Outstanding (in millions) | $923.8 | $1,033.9 |
| Weighted Average Effective Interest Rate (%) | 5.2% | 5.2% |
Market Trends and Outlook
Pool Corporation anticipates a decline in sales for the full year of 2024, projecting a decrease of approximately 5% from 2023 levels. The company expects continued demand for maintenance products but anticipates a decline in discretionary spending related to new pool construction and renovations due to macroeconomic conditions.
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Article updated on 8 Nov 2024
Resources:
- Pool Corporation (POOL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Pool Corporation (POOL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Pool Corporation (POOL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.