Scott Stringer's questions to Latham Group Inc (SWIM) leadership • Q4 2024
Question
Scott Stringer, on behalf of Greg Badishkanian at Wolfe Research, asked for the rationale behind the confidence in the full-year 8% sales growth guidance, given that Q1 2025 sales are expected to be flat year-over-year.
Answer
CFO Oliver Gloe explained that the flat Q1 performance is due to offsetting factors. While the company expects early benefits from its sand state and auto cover strategies, the timing of sales from the Coverstar Central acquisition shifts revenue recognition. Last year, Latham sold to Coverstar Central in Q1, but this year the combined entity sells to the end market in Q2. Gloe stated that as the year progresses into the seasonally strong Q2 and Q3, the Coverstar dynamic normalizes and the full benefits of the growth strategies are expected to materialize, driving the full-year growth.