David Lance Hays

David Lance Hays asked about Dorman's market share position across its light-duty, heavy-duty, and specialty vehicle segments in Q3, considering the strong light-duty sales and sequential improvements in other segments. He also inquired about Dorman's appetite for M&A and the current state of its acquisition pipeline, given its healthy balance sheet.

Answer

Kevin Olsen, President and CEO, Dorman Products, stated that Dorman believes it is gaining share in light-duty due to new product efforts, particularly new-to-aftermarket parts. In heavy-duty, he noted growth from tariff pricing and key customer wins, with significant runway in a large market. For specialty vehicles, despite flat sales, Dorman believes it is outperforming the market and gaining share through non-discretionary repair portfolio expansion and geographic growth. Regarding M&A, Kevin Olsen outlined segment-specific strategies and described the funnel as strong, though actionable targets have been slowed by tariff uncertainty. David Hession, SVP and CFO, Dorman Products, added that the strong balance sheet provides the capacity for M&A and absorbing higher inventory costs.

David Lance Hays asked about Dorman Products' share position across its light-duty, heavy-duty, and specialty vehicle segments in Q3, given strong light-duty sales and sequential improvements in the other two. He also inquired about the company's appetite for M&A and the current state of its acquisition pipeline.

Answer

Kevin Olsen, President and CEO, stated that Dorman believes it is taking share in light-duty due to new products. In heavy-duty, he noted nice growth from tariff pricing and customer wins, seeing significant runway. For specialty vehicles, despite flat sales, Dorman believes it is outperforming the market by taking share, driven by non-discretionary portfolio expansion and geographic growth. Regarding M&A, Mr. Olsen outlined segment-specific strategies (technology/geographic for light-duty, brand/product for specialty, channel for heavy-duty) and noted a strong funnel, though actionable targets have slowed due to tariff uncertainty. David Hession, SVP and CFO, highlighted the strong balance sheet (0.92x leverage) for funding inventory and M&A.

David Lance Hays from Wells Fargo asked for indications on franchise unit growth for fiscal 2026 to better understand the ramp to 150 units per year by 2027. He also requested an update on the performance of the fleet business.

Answer

CEO Lori Flees stated that the new unit pipeline continues to accelerate. Existing franchisees are on pace, while newer franchisees from the refranchising deals are ramping up on a more back-end loaded timeline, as expected. She also confirmed that the fleet business continues to perform strongly, with its growth outpacing the consumer side, aided by expanding partnerships with franchisees for regional and local accounts.