POOL CORP

Previous wording

As of June 30, 2026, total net receivables, including pledged receivables, increased 11% compared to June 30, 2025, primarily due to higher sales in June 2026. Our days sales outstanding (DSO), as calculated on a trailing four quarters basis, was 27.6 days at June 30, 2026 and 25.8 days at June 30, 2025. Our allowance for doubtful accounts balance was $8.5 million at June 30, 2026 and $8.3 million at June 30, 2025.

Current wording

As of September 30, 2026, total net receivables, including pledged receivables, increased 8% compared to September 30, 2025, primarily due to higher sales in September 2026. Our days sales outstanding (DSO), as calculated on a trailing four quarters basis, was 28.0 days at September 30, 2026 and 25.9 days at September 30, 2025. Our allowance for doubtful accounts balance was $10.3 million at September 30, 2026 and $8.3 million at September 30, 2025.

Previous wording

Our inventory balance was $1.4 billion at June 30, 2026, an increase of $48.5 million, or 4%, from June 30, 2025. The 4% year-over-year increase in inventory is down from the 14% increase reported in the first quarter of 2026, as we sell through our peak-season stocking levels. Our inventory levels reflect the impact of inflation and the addition of new and acquired sales centers over the past twelve months. Our inventory reserve was $24.1 million at June 30, 2026 and $27.7 million at June 30, 2025. Our inventory turns, as calculated on a trailing four quarters basis, was 2.6 times at June 30, 2026 and 2.8 times at June 30, 2025.

Current wording

Our inventory balance was $1.2 billion at September 30, 2026, a decrease of $38.6 million, or 3%, from September 30, 2025, compared to a 4% increase in sales from September 30, 2025. Our inventory reserve was $24.9 million at September 30, 2026 and $29.0 million at September 30, 2025. Our inventory turns, as calculated on a trailing four quarters basis, was 2.7 times at September 30, 2026 and 2.8 times at September 30, 2025.

Previous wording

Total debt outstanding increased $110.8 million to $1.3 billion at June 30, 2026, which helped to fund $266.7 million of open market share repurchases over the past twelve months.

Current wording

Total debt outstanding increased $104.9 million to $1.2 billion at September 30, 2026, which helped to fund $375.6 million of open market share repurchases over the past twelve months.

Previous wording

We expect sales for the full year of 2026 to increase by a low single-digit percentage compared to 2025.

Current wording

We expect net sales for the full year of 2026 to increase by 3% to 4% compared to 2025, with a 3% contribution from pricing.

Previous wording

We project gross margin for the full year of 2026 to be approximately 30 basis points below our 2025 gross margin of 29.7%. We expect our gross margin to be negatively impacted by higher inbound freight cost in the current year, partially offset by benefits from effective supply chain management, advantageous pricing strategies and increased private label sales. The prior year comparison is also impacted by margin benefit from mid-season price increases in the prior year. Our actual gross margin will depend on changes in product and customer mix and on amounts and timing of sales and inflationary price increases.

Current wording

We project gross margin for the full year of 2026 to be approximately 30 to 50 basis points below our 2025 gross margin of 29.7%. We expect higher inbound freight costs and customer mix to reduce our 2026 gross margin, while effective supply chain management, targeted pricing strategies and increased private label sales will partially offset these pressures. The year over year comparison is also impacted by margin benefit from prior year mid-season price increases. Our actual gross margin will depend on changes in product and customer mix and on amounts and timing of sales and inflationary price increases.

Previous wording

We expect to leverage our existing infrastructure and strategically manage discretionary spending while providing for a modest recovery in incentive compensation compared to the prior year. We project operating expenses for 2026 will increase approximately 3% compared to 2025, or 2% to 3% without the $8.3 million of CEO transition costs.

Current wording

We expect to leverage our existing infrastructure and strategically manage discretionary spending while providing for a modest recovery in incentive compensation compared to the prior year. We project operating expenses, excluding $8.3 million of CEO transition costs recorded in the second quarter of 2026, to grow at a slightly lower rate than net sales.

Previous wording

In 2026, we expect our effective tax rate will approximate 25.0% without the impact of Accounting Standards Update ASU 2016-09, Improvements to Employee Share-Based Payment Accounting. Under ASU 2016-09, we expect our effective tax rate will fluctuate from quarter to quarter, particularly in periods when employees elect to exercise their vested stock options or when restrictions on share-based awards lapse. We recorded a $0.7 million, or $0.02 per diluted share, tax benefit from ASU 2016-09 for the six months ended June 30, 2026.

Current wording

In 2026, we expect our effective tax rate will approximate 25.0% without the impact of ASU 2016-09. Under ASU 2016-09, we expect our effective tax rate will fluctuate from quarter to quarter, particularly in periods when employees elect to exercise their vested stock options or when restrictions on share-based awards lapse. We recorded a $0.7 million, or $0.02 per diluted share, tax benefit from ASU 2016-09 for the nine months ended September 30, 2026.

Previous wording

For 2026, we project diluted EPS in the range of $10.66 to $10.96, or $10.87 to $11.17, excluding the impact of CEO transition costs and including the impact of year-to-date tax GAAP benefits of $0.02. We may recognize additional tax benefits related to stock option exercises in 2026 from grants that expire in future years. We have not included any expected tax benefits in our full year guidance beyond what we have recognized as of June 30, 2026.

Current wording

For 2026, we project diluted EPS in the range of $10.66 to $10.96, or $10.87 to $11.17, excluding the impact of CEO transition costs and including the impact of year-to-date ASU 2016-09 tax benefits of $0.02. We may recognize additional tax benefits related to stock option exercises in 2026 from grants that expire in future years. We have not included any expected tax benefits in our full year guidance beyond what we have recognized as of September 30, 2026.

Previous wording

As of June 30, 2026, we conducted operations through 455 sales centers in North America, Europe and Australia. For the three and six months ended June 30, 2026, approximately 95% of our net sales were from our operations in North America.

Current wording

As of September 30, 2026, we conducted operations through 454 sales centers in North America, Europe and Australia. For the three and nine months ended September 30, 2026, approximately 95% of our net sales were from our operations in North America.

Previous wording

We have not provided separate base business income statements within this Form 10-Q as our base business results for the three and six months ended June 30, 2026 closely approximated consolidated results. Excluded sales centers contributed less than 1% to the change in our reported net sales.

Current wording

We have not provided separate base business income statements within this Form 10-Q as our base business results for the three and nine months ended September 30, 2026 closely approximated consolidated results. Excluded sales centers contributed less than 1% to the change in our reported net sales.

Previous wording

The table below summarizes the changes in our sales center count during the first six months of 2026:

Current wording

The table below summarizes the changes in our sales center count during the first nine months of 2026:

Previous wording

a benefit of approximately 3% from inflationary product cost increases;

Current wording

a benefit of approximately 3% from inflationary price increases;

Previous wording

building materials products growth (see discussion below), which helped offset overall declines in discretionary product sales.

Current wording

flat discretionary product sales, as growth in sales of building materials products (see discussion below) helped offset declines of other discretionary products.

Previous wording

In the second quarter of 2026, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased 3% versus the same period last year, and collectively represented approximately 29% of net sales for the period. Sales of building materials, which are primarily used in new pool construction and remodeling, increased 4% compared to the same period in 2025 and represented approximately 12% of net sales in the second quarter of 2026.

Current wording

In the third quarter of 2026, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased 5% versus the same period last year, and collectively represented approximately 30% of net sales for the period. Sales of building materials, which are primarily used in new pool construction and remodeling, increased 3% compared to the same period in 2025 and represented approximately 11% of net sales in the third quarter of 2026.

Previous wording

Interest and other non-operating expenses, net for the second quarter of 2026 increased $2.1 million compared to the second quarter of 2025, primarily due to an increase in average outstanding debt between periods. Our weighted average effective interest rate decreased to 4.2% in the second quarter of 2026 compared to 4.6% in the second quarter of 2025 on average outstanding debt of $1.3 billion and $1.1 billion for the respective periods.

Current wording

Interest and other non-operating expenses, net for the third quarter of 2026 decreased $0.2 million compared to the third quarter of 2025. Our weighted average effective interest rate decreased to 4.2% in the third quarter of 2026 compared to 4.5% in the third quarter of 2025 on average outstanding debt of $1.2 billion and $1.1 billion for the respective periods.

Previous wording

Our effective income tax rate was 25.8% for the three months ended June 30, 2026 compared to 25.4% for the three months ended June 30, 2025.

Current wording

Our effective income tax rate was 23.3% for the three months ended September 30, 2026 compared to 23.5% for the three months ended September 30, 2025. Our third quarter effective income tax rate is historically lower compared to other quarters due to the annual expiration of statutes of limitations in the various jurisdictions where we have recorded uncertain tax positions.

Previous wording

Net sales for the first six months of 2026 increased 4% from the same period last year. The following factors impacted our sales in the first six months of 2026 and are listed in order of estimated magnitude:

Current wording

Net sales for the first nine months of 2026 increased 4% from the same period last year. The following factors impacted our sales in the first nine months of 2026 and are listed in order of estimated magnitude:

Previous wording

a benefit of approximately 3% from inflationary product cost increases;

Current wording

a benefit of approximately 3% from inflationary price increases;

Previous wording

continued steady performance in maintenance products and private label chemical sales; and

Current wording

solid performance in maintenance products and private label chemical sales; and

Previous wording

building materials products growth (see discussion below), which helped offset overall declines in discretionary product sales.

Current wording

building materials products growth (see discussion below).

Previous wording

In the first six months of 2026, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased approximately 5% compared to the same period last year and collectively represented 31% of net sales in the first six months of 2026. The increase in sales of equipment reflects price increases and stable maintenance volumes. Sales of building materials, which are primarily used in new pool construction and remodeling, increased approximately 5% compared to the first six months of 2025 and represented approximately 12% of net sales in the first six months of 2026.

Current wording

In the first nine months of 2026, sales of equipment for maintenance, renovation and new construction activities, including swimming pool heaters, pumps, lights, filters and automation devices, increased approximately 5% compared to the same period last year and collectively represented 31% of net sales in the first nine months of 2026. The increase in sales of equipment reflects price increases and stable maintenance volumes. Sales of building materials, which are primarily used in new pool construction and remodeling, increased approximately 4% compared to the first nine months of 2025 and represented approximately 12% of net sales in the first nine months of 2026.

Previous wording

Gross profit increased 3% in the first six months of 2026 from the first six months of 2025. Gross margin declined 30 basis points to 29.4% in the six months ended June 30, 2026 compared to 29.7% in the first six months of 2025. Gross margin in the first six months of 2026 was impacted by increases in freight costs and an unfavorable shift in customer mix, partially offset by benefits from our supply chain optimization efforts.

Current wording

Gross profit increased 2% in the first nine months of 2026 from the first nine months of 2025. Gross margin declined 30 basis points to 29.3% in the nine months ended September 30, 2026 compared to 29.6% in the first nine months of 2025. The decrease in gross margin in the first nine months of 2026 was primarily driven by higher freight costs and a shift in customer and product mix. In addition, the year over year comparison was impacted by the margin benefit from prior year mid-season price increases that did not recur to the same extent in 2026.

Previous wording

Selling and administrative expenses (operating expenses) increased 4% to $273.1 million from $262.5 million in the same period in 2025, primarily driven by $8.3 million of CEO transition costs. CEO transition costs comprise $6.3 million of non-cash share-based compensation expense for awards previously granted but not fully amortized and $2.0 million of cash transition costs. Adjusting for the impact of CEO transition costs, operating expenses increased 1% to $264.8 million.

Current wording

Operating expenses increased 5% to $784.5 million compared to $748.5 million for the same period in 2025. Operating expenses for the nine months ended September 30, 2026 include $8.3 million of CEO transition costs, comprised of $6.3 million of non-cash share-based compensation expense for awards previously granted but not fully amortized and $2.0 million of cash transition costs. Adjusting for the impact of CEO transition costs, operating expenses increased 4%.

Previous wording

Interest and other non-operating expenses, net for the first six months of 2026 increased $3.3 million compared to the same period last year, primarily due to increases in average outstanding debt between periods. Our weighted average effective interest rate decreased to 4.2% from 4.5% for the respective periods on average outstanding debt of $1.2 billion for the six months ended June 30, 2026 and $1.0 billion for the six months ended June 30, 2025.

Current wording

Interest and other non-operating expenses, net for the first nine months of 2026 increased $3.0 million compared to the same period last year, primarily due to increases in average outstanding debt between periods. Our weighted average effective interest rate decreased to 4.2% from 4.5% for the respective periods on average outstanding debt of $1.2 billion for the nine months ended September 30, 2026 and $1.0 billion for the nine months ended September 30, 2025.

Previous wording

Our effective income tax rate was 25.4% for the six months ended June 30, 2026 compared to 24.2% for the six months ended June 30, 2025. We recorded a $0.7 million, or $0.02 per diluted share, tax benefit from ASU 2016-09 in the six months ended June 30, 2026 compared to a $3.9 million, or $0.10 per diluted share, tax benefit in the same period of 2025.

Current wording

Our effective income tax rate was 24.7% for the nine months ended September 30, 2026 compared to 24.0% for the nine months ended September 30, 2025. We recorded a $0.7 million, or $0.02 per diluted share, tax benefit from ASU 2016-09 in the nine months ended September 30, 2026 compared to a $4.2 million, or $0.11 per diluted share, tax benefit in the same period of 2025. Without the benefits from ASU 2016-09, our effective tax rate was 24.9% for the nine months ended September 30, 2026, compared to 24.8% for the nine months ended September 30, 2025.

Previous wording

Weather conditions in the second quarter of 2026 were characterized by above-average temperatures across many of our markets, with regional variability in precipitation. While severe storms and periods of heavy rainfall created localized disruptions in portions of the Midwest and South, warmer and drier conditions persisted across much of the West. Overall, the net impact on our second quarter results was broadly neutral. During the second quarter of 2025, the net impact of weather conditions were also generally neutral, with above-average temperatures being offset by localized disruptions from severe storms, flash flooding and tornado activity.

Current wording

Weather conditions in the second quarter of 2026 were characterized by above-average temperatures across many of our markets, with regional variability in precipitation. While severe storms and periods of heavy rainfall created localized disruptions in portions of the Midwest and South, warmer and drier conditions persisted across much of the West. Overall, the net impact on our second quarter results was broadly neutral. During the second quarter of 2025, the net impact of weather conditions was also generally neutral, with above-average temperatures being offset by localized disruptions from severe storms, flash flooding and tornado activity.

Previous wording

Management has discussed the development, selection and disclosure of our critical accounting estimates with the Audit Committee of our Board. For a description of our critical accounting estimates, please see the “Critical Accounting Estimates”

Current wording

Management has discussed the development, selection and disclosure of our critical accounting estimates with the Audit Committee of our Board. For a description of our critical accounting estimates, please see the “Critical Accounting Estimates” section included in Part II, Item 7 in our 2025 Annual Report on Form 10-K. We have not changed any of these policies from those previously disclosed in that report.

Previous wording

the timing and extent of share repurchases; and

Current wording

the timing and extent of discretionary share repurchases; and

Previous wording

Net cash used in investing activities for the first six months of 2026 increased $7.6 million compared to the first six months of 2025, primarily due to a $9.2 million increase in net capital expenditures.

Current wording

Net cash used in investing activities for the first nine months of 2026 decreased $8.3 million compared to the first nine months of 2025, primarily due to the absence of acquisition-related expenditures in 2026.

Previous wording

Net cash used in financing activities was $37.8 million for the first six months of 2026 compared to net cash provided by financing activities of $33.1 million for the first six months of 2025, primarily due to a decrease of $138.5 million in net debt proceeds between periods, partially offset by a $74.2 million decrease in share repurchases in the first six months of 2026 versus the same period in 2025.

Current wording

Net cash used in financing activities was $369.5 million for the first nine months of 2026 compared to $182.4 million for the first nine months of 2025. The increase in net cash used in financing activities reflects $33.1 million of net debt payments in the first nine months of 2026 compared to net debt proceeds of $112.4 million in the first nine months of 2025 and a $34.2 million increase in share repurchases.

Previous wording

At June 30, 2026, there was $424.4 million of revolving borrowings outstanding, a $500.0 million term loan outstanding, $15.7 million of standby letters of credit outstanding and $359.9 million available for borrowing under the Credit Facility. The weighted average effective interest rate for the Credit Facility as of June 30, 2026 was approximately 3.9%, excluding commitment fees and including the impact of our interest rate swaps.

Current wording

At September 30, 2026, there was $280.0 million of revolving borrowings outstanding, a $500.0 million term loan outstanding, $12.2 million of standby letters of credit outstanding and $507.8 million available for borrowing under the Credit Facility. The weighted average effective interest rate for the Credit Facility as of September 30, 2026 was approximately 3.9%, excluding commitment fees and including the impact of our interest rate swaps.

Previous wording

Our Term Facility provides for $90.0 million in borrowing capacity. We pay interest on borrowings under the Term Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Term Facility is repaid in quarterly installments of 1.250% of the Term Facility beginning in the third quarter of 2027, with the final principal repayment due on September 30, 2029. We may prepay amounts outstanding under the Term Facility without penalty other than interest breakage costs.

Current wording

Our Term Facility provides for $90.0 million in borrowing capacity. We pay interest on borrowings under the Term Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Term Facility requires quarterly amortization payments of 1.250% of the Term Facility beginning in the third quarter of 2027, with the final principal repayment due on September 30, 2029. We may prepay amounts outstanding under the Term Facility without penalty other than interest breakage costs.

Previous wording

At June 30, 2026, the Term Facility had an outstanding balance of $90.0 million at a weighted average effective interest rate of 4.9%.

Current wording

At September 30, 2026, the Term Facility had an outstanding balance of $90.0 million at a weighted average effective interest rate of 5.2%.

Previous wording

Our two-year Receivables Facility offers us a lower-cost form of financing. Under this facility, we can borrow up to $375.0 million between April through May and from $210.0 million to $350.0 million during the remaining months of the year. We pay interest on borrowings under the Receivables Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Receivables Facility matures on October 30, 2026. We classify the entire outstanding balance as Long-term debt, net on our Consolidated Balance Sheets as we intend and have the ability to refinance the obligations on a long-term basis.

Current wording

Our Receivables Facility offers us a lower-cost form of financing. Under this facility, we can borrow up to $400.0 million ($300.0 million committed and $100.0 million uncommitted) from March through September and up to $300.0 million ($200.0 million committed and $100.0 million uncommitted) during the remaining months of the year. We pay interest on borrowings under the Receivables Facility at a variable rate based on one-month Term SOFR, plus an applicable margin. The Receivables Facility matures on August 25, 2028.

Previous wording

At June 30, 2026, there was $315.5 million outstanding under the Receivables Facility at a weighted average effective interest rate of 4.6%, excluding commitment fees.

Current wording

At September 30, 2026, there was $286.0 million outstanding under the Receivables Facility at a weighted average effective interest rate of 4.7%, excluding commitment fees.

Previous wording

Maximum Average Total Leverage Ratio. On the last day of each fiscal quarter, our average total leverage ratio must be less than 3.25 to 1.00. Average Total Leverage Ratio is the ratio of the sum of (i) Total Non-Revolving Funded Indebtedness as of such date, (ii) the trailing twelve months (TTM) Average Total Revolving Funded Indebtedness and (iii) the TTM Average Accounts Securitization Proceeds divided by TTM EBITDA (as those terms are defined in the Credit Facility). As of June 30, 2026, our average total leverage ratio equaled 1.78 (compared to 1.73 as of March 31, 2026) and the TTM average total indebtedness amount used in this calculation was $1.2 billion.

Current wording

Maximum Average Total Leverage Ratio. On the last day of each fiscal quarter, our average total leverage ratio must be less than 3.25 to 1.00. Average Total Leverage Ratio is the ratio of the sum of (i) Total Non-Revolving Funded Indebtedness as of such date, (ii) the trailing twelve months (TTM) Average Total Revolving Funded Indebtedness and (iii) the TTM Average Accounts Securitization Proceeds divided by TTM EBITDA (as those terms are defined in the Credit Facility). As of September 30, 2026, our average total leverage ratio equaled 1.83 (compared to 1.78 as of June 30, 2026) and the TTM average total indebtedness amount used in this calculation was $1.2 billion.

Previous wording

Minimum Fixed Charge Coverage Ratio. On the last day of each fiscal quarter, our fixed charge ratio must be greater than or equal to 2.25 to 1.00. Fixed Charge Ratio is the ratio of the TTM EBITDAR divided by TTM Interest Expense paid or payable in cash plus TTM Rental Expense (as those terms are defined in the Credit Facility). As of June 30, 2026, our fixed charge ratio equaled 4.67 (compared to 4.73 as of March 31, 2026) and TTM Rental Expense was $115.4 million.

Current wording

Minimum Fixed Charge Coverage Ratio. On the last day of each fiscal quarter, our fixed charge ratio must be greater than or equal to 2.25 to 1.00. Fixed Charge Ratio is the ratio of the TTM EBITDAR divided by TTM Interest Expense paid or payable in cash plus TTM Rental Expense (as those terms are defined in the Credit Facility). As of September 30, 2026, our fixed charge ratio equaled 4.61 (compared to 4.67 as of June 30, 2026) and TTM Rental Expense was $117.5 million.

Previous wording

As of July 23, 2026, we were authorized to purchase up to $580.0 million of our common stock under our current Board-approved share repurchase program. We expect to continue to repurchase shares on the open market from time to time subject to market conditions. We plan to fund these repurchases with cash provided by operations and borrowings under the above-described credit facilities.

Current wording

As of October 21, 2026, we were authorized to purchase up to $468.4 million of our common stock under our current Board-approved share repurchase program. We expect to continue to repurchase shares on the open market from time to time subject to market conditions. We plan to fund these repurchases with cash provided by operations and borrowings under the credit facilities described above.