What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-04 compared with 2025-03-05 · 388 added, 282 removed, 809 unchanged (45% of the section changed)

4 unchanged sentences

Consolidated Statements of Operations for the Years Ended December 31, 202 5 , 202 4 and 20 23

Consolidated Statements of Comprehensive Loss for the Years Ended December 31, 2024, 2023 and 2022

Consolidated Statements of Comprehensive Income ( Loss ) for the Years Ended December 31, 202 5 , 202 4 and 20 23

Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 202 5 , 202 4 and 2 0 23

30 unchanged sentences

Current assets:

Cash $ 71,043 $ 56,398

Trade receivables, net 39,914 32,299

7 unchanged sentences

Operating lease right-of-use assets 30,723 28,259

Goodwill 155,189 152,625

Intangible assets, net 268,073 292,913

Other assets 4,214 3,644

Total assets $ 823,223 $ 794,207

Liabilities and Stockholders’ Equity

1 unchanged sentence

Accounts payable $ 19,283 $ 13,141

Accounts payable – related party

Current maturities of long-term debt 3,250 3,250

25 unchanged sentences

Year Ended December 31,

2025 2024 2023

Net sales $ 545,912 $ 508,520 $ 566,492

Cost of sales 363,824 354,776 413,548

Gross profit 182,088 153,744 152,944

Selling, general, and administrative expense 122,565 108,364 110,296

Underwriting fees related to offering of common stock

Amortization 28,944 27,103 26,519

Income from operations 30,579 18,277 16,129

1 unchanged sentence

Interest expense, net 25,805 24,840 30,916

Loss on extinguishment of debt

Other expense (income), net

Other (income) expense, net ( 3,492 ) 6,237 ( 1,004 )

Total other expense, net 22,313 31,077 29,912

Earnings from equity method investment 5,222 4,060 3,723

(Loss) income before income taxes

Income (loss) before income taxes 13,488 ( 8,740 ) ( 10,060 )

Income tax expense (benefit) 2,364 9,120 ( 7,672 )

Net loss per share attributable to common stockholders:

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Net income (loss) per share attributable to common stockholders:

Basic $ 0.10 $ ( 0.15 ) $ ( 0.02 )

Diluted $ 0.09 $ ( 0.15 ) $ ( 0.02 )

Weighted-average common shares outstanding – basic and diluted

Basic 116,424,673 115,434,828 112,899,586

Diluted 119,822,088 115,434,828 112,899,586

The accompanying notes are an integral part of these consolidated financial statements.

Latham Group, Inc.

Consolidated Statements of Comprehensive Loss

Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

Year Ended December 31,

Other comprehensive loss, net of tax:

2025 2024 2023

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustments 1,168 ( 1,511 ) ( 6 )

Total other comprehensive loss, net of tax

Comprehensive loss

Total other comprehensive income (loss), net of tax 1,168 ( 1,511 ) ( 6 )

Comprehensive income (loss) $ 12,292 $ ( 19,371 ) $ ( 2,394 )

The accompanying notes are an integral part of these consolidated financial statements.

2 unchanged sentences

(in thousands, except share amounts)

Common Stock Additional

Capital Accumulated

Deficit Accumulated

Comprehensive

Stockholders’

Shares Amount

Balances at January 1, 2023 114,667,975 $ 11 $ 440,880 $ ( 54,568 ) $ ( 3,533 ) $ 382,790

Cumulative effect of adoption of new accounting standard- leases (Note 2)

Cumulative effect of adoption of new revenue recognition standard (Note 2)

Net loss — — — ( 2,388 ) — ( 2,388 )

Foreign currency translation adjustments — — — — ( 6 ) ( 6 )

Proceeds from sale of common stock

Repurchase and retirement of common stock

( 13,800,244 )

Repurchases and retirements of common stock under Repurchase Program

( 4,483,620 )

Retirement of restricted stock ( 155,450 ) — — — — —

2 unchanged sentences

Balances at December 31, 2023 114,871,782 11 459,684 ( 56,956 ) ( 3,539 ) 399,200

Net loss — — — ( 17,860 ) — ( 17,860 )

Foreign currency translation adjustments — — — — ( 1,511 ) ( 1,511 )

Retirement of restricted stock

Issuance of common stock upon release of restricted stock units 893,057 1 — — — 1

1 unchanged sentence

Balances at December 31, 2024 115,764,839 12 467,076 ( 74,816 ) ( 5,050 ) 387,222

Net income — — — 11,124 — 11,124

Foreign currency translation adjustments — — — — 1,168 1,168

Issuance of common stock upon release of restricted stock units 1,447,840 — — — — —

Common stock withheld for taxes on restricted stock units ( 445,752 ) — ( 2,900 ) — — ( 2,900 )

Stock-based compensation expense — — 9,247 — — 9,247

5 unchanged sentences

Year Ended December 31,

2025 2024 2023

Cash flows from operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 51,354 44,446 40,751

Gain on insurance proceeds received for capital — — ( 1,463 )

Unrealized foreign currency loss (gains)

Unrealized foreign currency (gains) loss ( 4,131 ) 6,223 ( 110 )

Amortization of deferred financing costs and debt discount 1,720 1,720 1,720

3 unchanged sentences

Stock-based compensation expense 9,247 7,392 18,804

Underwriting fees related to offering of common stock

Loss on extinguishment of debt

Bad debt expense 1,736 2,069 5,379

5 unchanged sentences

Trade receivables ( 9,223 ) ( 2,378 ) 13,040

Inventories 2,840 22,695 68,190

Prepaid expenses and other current assets ( 1,622 ) ( 1,992 ) ( 1,326 )

Income tax receivable ( 8,214 ) ( 2,981 ) 1,333

Other assets ( 244 ) 1,263 ( 4,346 )

Accounts payable 5,803 ( 4,039 ) ( 8,512 )

4 unchanged sentences

Purchases of property and equipment ( 25,385 ) ( 20,116 ) ( 33,189 )

Deposit on property purchases ( 12,000 ) — —

Capital reimbursed from insurance proceeds — — 1,463

Proceeds from the sale of property and equipment

Acquisition of business, net of cash acquired ( 4,934 ) ( 64,527 ) —

1 unchanged sentence

Cash flows from financing activities:

Proceeds from long-term debt borrowings

Payments on long-term debt borrowings ( 3,250 ) ( 21,250 ) ( 13,250 )

1 unchanged sentence

Payments on revolving credit facilities ( 25,000 ) — ( 48,000 )

Deferred financing fees paid

Proceeds from the issuance of common stock

Repayments of finance lease obligations ( 823 ) ( 771 ) ( 625 )

Repurchase and retirement of common stock

Net cash (used in) provided by financing activities

Common stock withheld for taxes on restricted stock units ( 2,900 ) — —

Net cash used in financing activities ( 6,973 ) ( 22,021 ) ( 13,875 )

Effect of exchange rate changes on cash 507 ( 1,008 ) ( 631 )

Net (decrease) increase in cash

Net increase (decrease) in cash 14,645 ( 46,365 ) 70,137

Cash at beginning of period 56,398 102,763 32,626

5 unchanged sentences

Purchases of property and equipment included in accounts payable and accrued expenses $ 1,148 $ 510 $ 955

Capitalized internal-use software included in accounts payable – related party

Right-of-use operating and finance lease assets obtained in exchange for lease liabilities 10,353 5,426 6,193

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Severe weather may also affect net sales in all periods.

On January 1, 2022, the Company adopted ASU 2016-02, “Leases (Topic 842),” and the related amendments The optional transition method of adoption was used, in which the cumulative effect of initially applying the new standard to existing leases was $ 0.3 million to record the operating lease right-of-use assets and the related liabilities as of January 1, 2022.

Under this method of adoption, the comparative information has not been revised and continues to be reported under the previously applicable lease accounting guidance.

For leases with initial terms greater than 12 months, the Company considers these right-of-use assets and records the related asset and obligation at the present value of lease payments over the term.

3 unchanged sentences

The Company estimates an incremental borrowing rate to discount the lease payments based on information available at lease commencement because the implicit rate of the lease is generally not known.

The Company leases vehicles, manufacturing facilities, office space, land, and equipment under operating leases.

The Company leases manufacturing facilities, office space, land, and certain vehicles under operating leases.

The Company also leases certain vehicles and equipment under finance leases.

The Company determines if an arrangement is a lease at inception.

2 unchanged sentences

Revenue Recognition

Under ASC 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.

Under FASB ASC 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.

To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

the contract(s) with a customer;

(ii) identify the performance obligations in the contract;

14 unchanged sentences

For each product shipped, the transaction price by product is specified in the purchase order.

The Company recognizes revenue on the transaction price less any estimated rebates, cash discounts, or other sales incentives.

Customer rebates, cash discounts, and other sales incentives are estimated by applying the portfolio approach using the most-likely-amount method and are recorded as a reduction to revenue.

The Company recognizes revenue on the transaction price less any estimated rebates or other sales incentives.

Customer rebates and other sales incentives are estimated by applying the portfolio approach using the most-likely-amount method and are recorded as a reduction to revenue.

Estimates are updated each reporting period and any changes are allocated to the performance obligations on the same basis as at inception.

17 unchanged sentences

Warranty costs are recorded within cost of sales on the consolidated statements of operations.

The Company’s provision for product warranties was recorded within accrued expenses and other current liabilities and other long-term liabilities on the consolidated balance sheets as of December 31, 2024 and 2023.

The Company’s provision for product warranties was recorded within accrued

expenses and other current liabilities and other long-term liabilities on the consolidated balance sheets as of December 31, 2025 and 2024.

Cost of Sales

48 unchanged sentences

Equity Method Investments

Investments and ownership interests in common stock or in-substance common stock are accounted for under the equity method accounting if the Company has the ability to exercise significant influence over the entity, but does

not have a controlling financial interest.

The Company also uses the equity method of accounting for investments in a partnership or limited liability company with specific ownership accounts, if the Company has an ownership interest of 5% or more.

6 unchanged sentences

Under the cumulative earnings approach, the Company compares the distributions received to its cumulative equity-method earnings since inception.

Any distributions received up to the amount of cumulative equity earnings are be considered a return on investment and classified in operating activities.

Any distributions received up to the amount of cumulative equity earnings are considered a return on investment and classified in operating activities.

Any excess distributions would be considered a return of investment and classified in investing activities.

14 unchanged sentences

Depreciation and amortization expense are recognized using the straight-line method over the estimated useful lives of each respective asset category as follows:

Building and improvements

Molds and dyes

Machinery and equipment (including computer equipment and software)

Furniture and fixtures

Building and improvements 25 years

Molds and dyes 5 – 10 years

Machinery and equipment (including computer equipment and software) 3 – 10 years

Furniture and fixtures 5 – 7 years

Vehicles 5 years

Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful lives of the improvements.

15 unchanged sentences

The weighted-average estimated useful lives (in years) of the Company’s definite-lived intangible assets are as follows:

Trade names and trademarks

14 – 15 years

Dealer relationships

Patented technology

Non-competition agreements

Franchise relationships

Order backlog

10 – 12 months

Asset Estimated

Trade names and trademarks 9 – 25 years

Technology 15 years

Pool designs 14 – 15 years

Dealer relationships 5 – 13 years

Patented technology 5 – 10 years

Non-competition agreements 5 years

Franchise relationships 4 years

Order backlog 10 – 12 months

The Company accounts for goodwill as the excess of the purchase price over the net amount of identifiable assets acquired and liabilities assumed in a business combination measured at fair value.

3 unchanged sentences

Impairment testing is performed for the Company’s reporting unit by first assessing qualitative factors to see if further testing of goodwill is required.

If the Company concludes that it is more likely than not that its reporting unit’s

fair value is less than its carrying amount based on the qualitative assessment, then a quantitative test is required.

If the Company concludes that it is more likely than not that its reporting unit’s fair value is less than its carrying amount based on the qualitative assessment, then a quantitative test is required.

The Company may also choose to bypass the qualitative assessment and perform the quantitative test.

8 unchanged sentences

Segment Reporting

The Company identifies operating segments based on how the chief operating decision maker manages the business, allocates resources, makes operating decisions, and evaluates operating performance.

The Company identifies operating segments based on how the chief operating decision maker ("CODM") manages the business, allocates resources, makes operating decisions, and evaluates operating performance.

The Company conducts its business as one operating and reportable segment that designs, manufactures, and markets in-ground swimming pools, pool covers, and pool liners.

The Company’s Chief Executive Officer, who is the chief operating decision maker, reviews financial information presented on a consolidated basis for purposes of assessing financial performance and allocating resources.

The Company’s Chief Executive Officer, who is the CODM, reviews financial information presented on a consolidated basis for purposes of assessing financial performance and allocating resources.

The Company accounts for income taxes using the asset and liability method.

1 unchanged sentence

Changes in deferred tax assets and liabilities are recorded in the provision for income taxes.

The Company evaluates the realizability of its deferred tax assets and establishes a valuation allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized.

The Company evaluates the realizability of its deferred tax assets and establishes a valuation

allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized.

Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected, scheduling of anticipated reversals of taxable temporary differences, and considering prudent and feasible tax planning strategies.

9 unchanged sentences

The Company’s policy is to classify interest and penalties related to unrecognized tax benefits as a component of income tax expense (benefit) within the consolidated statements of operations.

The Company had $ 0.0 million of

accrued interest and no accrued penalties as of December 31, 2024 and December 31, 2023.

The Company had no accrued interest and no accrued penalties as of December 31, 2025 and December 31, 2024.

The Company reinvests earnings of foreign operations indefinitely and, accordingly, does not provide for income taxes that could result from the remittance of such earnings.

The Company has evaluated the impact of Pillar Two (as defined below) in the jurisdictions in which the Company operates and has determined no additional top up tax is required.

The Company has evaluated the impact of Pillar Two in the jurisdictions in which the Company operates and has determined no additional top up tax is required.

Stock-Based Compensation

7 unchanged sentences

Treasury zero-coupon issues similar in duration to the expected term of the stock-based award.

The Company considers the historical volatility of the Company’s stock price, as well as its implied volatility.

Due to the lack of a public market for the Company’s common stock and lack of company-specific historical and implied volatility data, the Company has based its computation of expected volatility on the historical volatility of a representative group of public companies with similar characteristics to the Company.

The historical volatility is calculated based on a period of time corresponding with expected term assumption.

The Company utilized a dividend yield of zero, since it has no history or plan of declaring dividends on its common stock.

12 unchanged sentences

The related foreign currency translation adjustments are recorded as a component of accumulated other comprehensive income (loss) in stockholders’ equity.

Transaction gains and losses associated with the Company’s international subsidiaries, which are denominated in currencies other than the Company’s foreign entities’ functional currencies, are recognized as a component of other expense (income), net within the consolidated statements of operations.

Transaction gains and losses associated with the Company’s international subsidiaries, which are denominated in currencies other than the Company’s foreign entities’ functional currencies, are recognized as a component of other (income) expense, net within the consolidated statements of operations.

Advertising Costs

2 unchanged sentences

Comprehensive Income (Loss)

Comprehensive income (loss) is a measure of net income (loss) and all other changes in equity that result from transactions other than with equity holders and would normally be recorded in the consolidated statements of stockholders’ equity and the consolidated statements of comprehensive income.

Other comprehensive income (loss) consists of foreign currency translation adjustments.

9 unchanged sentences

Recently Issued Accounting Pronouncements

The Company qualifies as “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 and has elected to “opt in” to the extended transition related to complying with new or revised accounting standards, which means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company will adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and will do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company.

The Company may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”), in an effort to enhance the transparency and decision usefulness of income tax disclosures.

For all entities, ASU 2023-09 is effective for fiscal years beginning after December 15, 2024.

The amendments should be applied prospectively with retrospective application permitted.

Early adoption is also permitted.

The Company is currently evaluating ASU 2023-09 and its potential impact on the notes to the consolidated financial statements.

In March 2024, the FASB issued ASU 2024-01, Compensation – Stock Compensation (Topic 718):

Scope Application of Profits Interest and Similar Awards (“ASU 2024-01”), which improves financial reporting by providing clarity on when an entity should apply the scope guidance in paragraph 718-10-15-3.

ASU 2024-01 is effective for public business entities for fiscal years beginning after December 15, 2024.

For all other entities, the amendments are effective for fiscal years beginning after December 15, 2025.

The amendments should be applied retrospectively to all prior periods presented in the financial statements, with early adoption permitted.

The Company is currently evaluating ASU 2024-01 and its potential impact on the condensed consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40 (“ASU 2024-03”)), which improves disclosures to provide more detailed information about a business entity’s expenses.

3 unchanged sentences

The Company is currently evaluating ASU 2024-03 and its potential impact on the consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which offers a practical expedient for public companies valuing their current expected credit losses.

ASU 2025-05 is effective for public business entities for fiscal years beginning after December 15, 2025 and interim reporting periods within those annual reporting periods.

The amendments should be applied prospectively.

The Company is currently evaluating ASU 2025-05 and its potential impact on the consolidated financial statements.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270) (“ASU 2025-11”), which improves the navigability of the required interim disclosures and clarifying when that guidance is applicable.

ASU 2025-11 is effective for public business entities for interim reporting periods within annual fiscal years beginning after December 15, 2027.

The amendments should be applied retrospectively to all prior periods presented in the financial statements, with early adoption permitted.

The Company is currently evaluating ASU 2025-11 and its potential impact on the consolidated financial statements.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures (“ASU 2023-07”), requiring public entities to disclose information about their reportable segments’ significant expenses and other segment items on an interim and annual basis.

Public entities with a single reportable segment are required to apply the disclosure requirements in ASU 2023-07, as well as all existing segment disclosures and reconciliation requirements in ASC 280 on an interim and annual basis.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”), in an effort to enhance the transparency and decision usefulness of income tax disclosures.

For all entities, ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025.

The amendments should be applied prospectively with retrospective application permitted.

The Company adopted ASU 2023-09 during the year ended December 31, 2025.

6 unchanged sentences

The Company incurred $ 0.9 million in transaction costs.

The results of Coverstar Central’s operations have been included in the condensed consolidated financial statements since that date.

The results of Coverstar Central’s operations have been included in the consolidated financial statements since that date.

Coverstar Central is an automatic safety cover dealer based in the United States.

1 unchanged sentence

Additionally, the acquisition provides the Company with an increase in dealer and franchise relationships.

The Company accounted for the Coverstar Central Acquisition using the acquisition method of accounting in accordance with FASB ASC 805, Business Combinations (“ASC 805”).

The Company accounted for the Coverstar Central Acquisition using the acquisition method of accounting in accordance with FASB ASC 805, Business Combinations .

This requires that the assets acquired and liabilities assumed be measured at fair value.

2 unchanged sentences

The Company recorded the assets acquired and liabilities assumed at their respective fair values as of the Acquisition Date.

The fair value of assets acquired and liabilities assumed recorded in the condensed consolidated financial statements may be subject to adjustment pending completion of final evaluation.

These fair value estimates will be reevaluated and adjusted, if needed, during the measurement period of up to one year from the Acquisition Date, and recorded as adjustments to goodwill.

The following summarizes the allocation for the Company’s acquisition of Coverstar Central as of December 31, 2024:

(in thousands)

August 2, 2024

These fair value estimates were evaluated during the measurement period of up to one year from the Acquisition Date, and are no longer subject to change.

The following summarizes the purchase price allocation for the Company’s acquisition of Coverstar Central:

(in thousands) August 2, 2024

Total consideration $ 71,516

Trade receivables 7,020

Inventories 4,293

Prepaid expenses and other current assets 53

7 unchanged sentences

Total fair value of net assets acquired, excluding goodwill 49,469

Goodwill $ 22,047

The excess of the total consideration over the fair value of the identifiable assets acquired and the liabilities assumed in the acquisition was allocated to goodwill in the amount of $ 22.0 million.

3 unchanged sentences

Definite-lived intangible assets:

(in thousands)

(in thousands) Amortization

Period (in years)

1 unchanged sentence

Order backlog 420 1

The following are the incremental net sales and incremental net loss from Coverstar Central included in the Company’s results from the Acquisition Date through December 31, 2024:

(in thousands)

Pro Forma Financial Information (Unaudited)

3 unchanged sentences

(in thousands) 2025 2024 2023

Net (loss) income

Net sales $ 545,912 $ 520,795 $ 586,717

Net income (loss) $ 11,308 $ ( 12,634 ) $ 2,794

The pro forma financial information presented above reflects the effects as a result of the acquisition, including the amortization expense from acquired intangible assets, the additional cost of sales from acquired inventory, the elimination of intercompany transactions and the removal of certain costs (primarily payroll costs) that would not have occurred and any related tax effects.

Transaction costs for Coverstar Central are reflected within pro forma net income for the year ended December 31, 2023.

In addition, the Company acquired two of its smaller autocover dealers in February 2025.

Other Business Combinations

In February 2025, the Company completed the acquisition of two autocover dealers located in New York and Tennessee for a purchase price of $ 5.6 million.

This acquisition qualified as a business combination.

This transaction resulted in an increase to goodwill and intangibles, but was not material to our consolidated financial statements, and as a result, additional business combination disclosures for this acquisition have been omitted.

EQUITY METHOD INVESTMENT

4 unchanged sentences

or the Company determined the purchase price per common unit paid by Premier Group Holdings Inc., indicating the amount paid for the common units of Premier Pools & Spas reflects the price that would be paid in an arm’s-length transaction.

As a result of the transaction, the Company received cash proceeds of $ 6.8 million and recorded a gain on the sale of equity method investment of $ 3.9 million.

The Company’s post-sale ownership interest in Premier Pools & Spas was 20.1 % following such transaction.

On December 17, 2021, Premier Pools & Spas issued additional non-voting common units to Premier Group Holdings Inc.

As a result of the transaction, the Company recorded a gain on the sale of equity method investment of $ 1.0 million.

The Company’s ownership interest in Premier Pools & Spas after the issuance of additional non-voting common units is 18.2 % while its voting interest remains 20.1 %.

The Company historically has concluded that it held common stock of Premier Pools & Spas and had the ability to exercise significant influence over Premier Pools & Spas but did not have a controlling financial interest.

The Company historically concluded that it held common stock of Premier Pools & Spas and had the ability to exercise significant influence over Premier Pools & Spas but did not have a controlling financial interest.

As required when there is a change in facts or circumstances, the Company reassessed its ability to exercise significant influence during the quarter ended December 31, 2022.

11 unchanged sentences

As of December 31, 2025 and 2024, the Company’s carrying amount for the equity method investment in Premier Pools & Spas was $ 26.5 million and $ 24.9 million, respectively.

During the year ended December 31, 2024, Premier Pools & Spas paid the Company dividends of $ 5.1 million that are presented on the consolidated statement of cash flows as distribution received from equity method investment.

During the year ended December 31, 2023, Premier Pools & Spas paid the Company dividends of $ 2.9 million that are presented on the consolidated statement of cash flows

as distribution received from equity method investment.

Premier Pools & Spas paid the Company dividends that are presented on the consolidated statements of cash flows as distribution received from equity method investment of $ 3.6 million and $ 5.1 million for the years ended December 31, 2025 and 2024, respectively.

The Company recorded its interest in net earnings of Premier Pools & Spas of $ 5.2 million and $ 4.1 million for the years ended December 31, 2025 and 2024, respectively, which included basis difference adjustments of $ 0.2 million and $ 0.2 million, respectively.

23 unchanged sentences

The following table sets forth the carrying amount and fair value of the term loans (in thousands):

Value Estimated

Fair Value Carrying

Value Estimated

Term Loan $ 279,841 $ 279,841 $ 281,521 $ 276,946

Interest rate swap

2 unchanged sentences

As of December 31, 2025 and 2024, the Company’s interest rate swap was a liability of $ 1.1 million and $ 0.4 million, respectively, which was recorded within other long-term liabilities on the consolidated balance sheets.

See Note 9 for further detail.

GOODWILL AND INTANGIBLE ASSETS, NET

1 unchanged sentence

Balance as of December 31, 2023 $ 131,363

Acquisition 22,047

Foreign currency translation adjustment ( 785 )

Balance as of December 31, 2024 152,625

Acquisition 1,947

Foreign currency translation adjustment 617

Balance as of December 31, 2025 $ 155,189

The Company performed an annual test for goodwill impairment in the fourth quarter of the year ended December 31, 2024 in accordance with Step 0 of ASC 350 and determined that goodwill was not impaired.

The Company performed an annual test for goodwill impairment in the fourth quarter of the year ended December 31, 2023 in accordance with Step 1 of ASC 350 and determined that goodwill was not impaired.

The Company performed an annual test for goodwill impairment in the fourth quarter of the years ended December 31, 2025 and December 31, 2024 in accordance with Step 0 of FASB ASC 350, Intangibles - Goodwill and Other and determined that goodwill was not impaired.

Intangible Assets

1 unchanged sentence

December 31, 2025

Amount Foreign

Translation Accumulated

Amortization Net

Trade names and trademarks $ 148,100 $ ( 112 ) $ 42,784 $ 105,204

Patented technology 16,126 — 11,776 4,350

Franchise relationships

Technology 13,000 — 3,540 9,460

Pool designs 13,628 ( 78 ) 4,845 8,705

Dealer relationships 238,551 — 98,197 140,354

Order backlog 2,020 — 2,020 —

Non-competition agreements

$ 431,425 $ ( 190 ) $ 163,162 $ 268,073

Intangible assets, net as of December 31, 2024 consisted of the following (in thousands):

December 31, 2024

Amount Foreign

Translation Accumulated

Amortization Net

Trade names and trademarks $ 148,100 $ ( 592 ) $ 36,183 $ 111,325

Patented technology 16,126 ( 9 ) 10,303 5,814

Franchise relationships

Technology 13,000 — 2,673 10,327

Pool designs 13,628 ( 293 ) 3,909 9,426

Dealer relationships 235,176 ( 3 ) 79,397 155,776

Order backlog 2,020 — 1,775 245

Non-competition agreements

$ 428,050 $ ( 897 ) $ 134,240 $ 292,913

The Company recognized $ 28.9 million, $ 27.1 million, and $ 26.5 million of amortization expense related to intangible assets during the years ended December 31, 2025, 2024, and 2023, respectively.

The Company estimates that amortization expense related to definite-lived intangible assets will be as follows in each of the next five fiscal years and thereafter (in thousands):

Estimated Future

Fiscal Year Ending

Fiscal Year Ending Estimated Future

2026 $ 28,719

Thereafter 138,943

INVENTORIES, NET

2 unchanged sentences

Finished goods 23,953 27,779

$ 74,926 $ 77,101

PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of the following (in thousands):

Land $ 2,727 $ 2,684

Building and improvements 43,452 38,567

4 unchanged sentences

Leasehold improvements 15,577 13,744

Vehicles 6,003 5,134

Construction in progress 15,988 17,497

203,002 174,738

Accumulated depreciation ( 84,182 ) ( 61,890 )

$ 118,820 $ 112,848

Depreciation and amortization expense related to property and equipment during the years ended December 31, 2025, 2024 and 2023 was $ 21.6 million, $ 16.5 million, and $ 13.8 million, respectively.

Construction in progress recorded as of December 31, 2025 and 2024 primarily related to an ongoing effort to increase fiberglass molds and fiberglass production capacity as well as our ongoing digital transformation project costs.

The Company recorded aggregate losses on sales and disposals of property and equipment of $ 0.1 million, $ 0.3 million, and $ 0.2 million during the years ended December 31, 2024, 2023 and 2022, respectively.

The Company recorded aggregate gains on sales and disposals of property and equipment of less than $ 0.1 million during the year ended December 31, 2025 and aggregate losses on sales and disposals of property and equipment of $ 0.4 million and $ 0.1 million during the years ended December 31, 2024 and 2023, respectively.

LONG-TERM DEBT

The components of the Company’s outstanding debt obligations consisted of the following (in thousands):

Term Loan $ 284,813 $ 288,063

Revolving Credit Facility — —

Unamortized discount and debt issuance costs ( 4,972 ) ( 6,542 )

Total debt 279,841 281,521

Current portion of long-term debt ( 3,250 ) ( 3,250 )

Total long-term debt $ 276,591 $ 278,271

On February 23, 2022, Latham Pool Products entered into an agreement (the “Credit Agreement”) with Barclays Bank PLC, which provides a senior secured multicurrency revolving line of credit (the “Revolving Credit Facility”) in an initial principal amount of $ 75.0 million and a U.S.

Dollar senior secured term loan (the “Term Loan”) in an initial principal amount of $ 325.0 million.

On the closing date, proceeds under the Credit Agreement were used to terminate the previous credit agreement by repayment of $ 294.0 million of outstanding debt thereunder and for general corporate purposes.

As of December 31, 2024, the Company was in compliance with all financial covenants under the Credit Agreement.

On February 23, 2022, Latham Pool Products and certain subsidiary guarantors entered into a credit and guaranty agreement (the “Credit Agreement”) with Barclays Bank PLC, which provides a senior secured multicurrency revolving line of credit (the “Revolving Credit Facility”) in an initial principal amount of $ 75.0 million and a U.S.

Dollar senior secured term loan facility (the “Term Loan”) in an initial principal amount of $ 325.0 million.

The Company is required to meet certain financial covenants, including maintaining specific liquidity measurements.

There are also negative covenants, including certain restrictions on the Company's ability to incur additional indebtedness, create liens, make investments, consolidate or merge with other entities, enter into transactions with affiliates, make prepayments with respect to certain indebtedness and make restricted payments and other distributions.

Revolving Credit Facility

2 unchanged sentences

The Revolving Credit Facility matures on February 23, 2027.

Loans outstanding under the Revolving Credit Facility

denominated in U.S.

Loans outstanding under the Revolving Credit Facility denominated in U.S.

Dollars and Canadian Dollars bear interest, at the borrower’s option, at a rate per annum based on Term SOFR or CDO (each, as defined in the Credit Agreement), as applicable, plus a margin of 3.50 %, or at a rate per annum based on the Base Rate or the Canadian Prime Rate (each, as defined in the Credit Agreement), plus a margin of 2.50 %.

1 unchanged sentence

A commitment fee accrues on any unused portion of the commitments under the Revolving Credit Facility.

The commitment fee is due and payable quarterly in arrears and is, initially, 0.375 % per annum and will, thereafter, accrue at a rate per annum ranging from 0.25 % to 0.50 %, depending on the First Lien Net Leverage Ratio (as defined in the Credit Agreement, the “First Lien Net Leverage Ratio”).

Borrowings under the Revolving Credit Facility are due at maturity.

The commitment fee is due and payable quarterly in arrears and initially was 0.375 % per annum and, thereafter, accrues at a rate per annum ranging from 0.25 % to 0.50 %, depending on the First Lien Net Leverage Ratio (as defined in the Credit Agreement).

Borrowings under the Revolving Credit Facility are not subject to amortization and are due at maturity.

The Company incurred debt issuance costs of $ 0.8 million related to the Revolving Credit Facility.

The debt issuance costs were recorded within other assets on the consolidated balance sheet and are being amortized over the life of the Revolving Credit Facility.

The Company is required to meet certain financial covenants, including maintaining specific liquidity measurements.

There are also negative covenants, including certain restrictions on the Company’s ability to incur additional indebtedness, create liens, make investments, consolidate, or merge with other entities, enter into transactions with affiliates, make prepayments with respect to certain indebtedness, and make restricted payments and other distributions.

As of December 31, 2025, there were no outstanding borrowings on the Revolving Credit Facility and $ 75.0 million was available for future borrowing.

1 unchanged sentence

The Term Loan matures on February 23, 2029.

Loans outstanding under the Term Loan bear interest, at the borrower’s option, at a rate per annum based on Term SOFR (as defined in the Credit Agreement), plus a margin ranging from 3.75 % to 4.00 %, depending on the First Lien Net Leverage Ratio, or based on the Base Rate (as defined in the Credit Agreement), plus a margin ranging from 2.75 % to 3.00 %, depending on the First Lien Net Leverage Ratio.

Loans outstanding under the Term Loan bear interest, at the borrower’s option, at a rate per annum based on Term SOFR (each, as defined in the Credit Agreement), plus a margin ranging from 3.75 % to 4.00 %, depending on the First Lien Net Leverage Ratio, or based on the Base Rate (as defined in the Credit Agreement), plus a margin ranging from 2.75 % to 3.00 %, depending on the First Lien Net Leverage Ratio.

Loans under the Term Loan are subject to scheduled quarterly amortization payments of $ 812,500 , equal to 0.25 % of the initial principal amount of the Term Loan.

The Term Loan contains customary mandatory prepayment provisions, including requirements to make mandatory prepayments with 50 % of any excess cash flow and with 100 % of the net cash proceeds from the incurrence of indebtedness not otherwise permitted to be incurred by the covenants, asset sales, and casualty and condemnation events, in each case, subject to customary exceptions.

indebtedness not otherwise permitted to be incurred by the covenants, asset sales, and casualty and condemnation events, in each case, subject to customary exceptions.

During the fiscal year ended December 31, 2024, the Company made a payment of $ 18.0 million in addition to the required annual payments $ 3.3 million.

No additional payments are expected in the year ended December 31, 2025.

Outstanding borrowings as of December 31, 2024 were $ 281.5 million, net of discount and debt issuance costs of $ 6.5 million.

No additional payments were made in the year ended December 31, 2025.

Outstanding borrowings as of December 31, 2025 were $ 279.8 million, net of unamortized discount and debt issuance costs of $ 5.0 million.

In connection with the Term Loan, the Company is subject to various negative, reporting, financial, and other covenants, including maintaining specific liquidity measurements.

1 unchanged sentence

The effective interest rate was 8.91 % at December 31, 2025, including the impact of the Company’s interest rate swap.

As of December 31, 2024, the Company was in compliance with all financial covenants under the Credit Agreement.

Interest Rate Risk

Interest rate risk associated with the Credit Agreement is mitigated partially through an interest rate swap.

The Company executed an interest rate swap on April 30, 2020.

The swap had an effective date of May 18, 2020 and a termination date of May 18, 2023.

In February 2022, the Company amended its interest rate swap to change the index rate from LIBOR to SOFR in connection with the entry into the Credit Agreement.

Under the terms of the amended swap, the Company fixed its SOFR borrowing rate at 0.496 % on a notional amount of $ 200.0 million.

The interest rate swap was not designated as a hedging instrument for accounting purposes.

The Company entered into an interest rate swap that was executed on March 10, 2023, in connection with its Credit Agreement.

The swap has an effective date of May 18, 2023 and a termination date of May 18, 2026.

Under the terms of the swap, the Company fixed its SOFR borrowing rate at 4.3725 % on a notional amount of $ 161.0 million.

The interest rate swap is not designated as a hedging instrument for accounting purposes.

Refer to Note 5 for additional detail.

Interest rate risk associated with the Credit Agreement is mitigated partially through interest rate swaps.

The Company entered into an interest rate swap that was executed on March 10, 2023, (the "2023 Interest Rate Swap").

The 2023 Interest Rate Swap had an effective date of May 18, 2023 and a termination date of May 18, 2026.

Under the terms of the 2023 Interest Rate Swap, the Company fixed its SOFR borrowing rate at 4.3725 % on a notional amount of $ 161.0 million.

The 2023 Interest Rate Swap was not designated as a hedging instrument for accounting purposes (see Note 5 for additional detail).

Subsequently, the Company entered into a new interest rate swap that was executed on June 4, 2025 (the “2025 Interest Rate Swap”).

As part of the 2025 Interest Rate Swap, the Company terminated the 2023 Interest Rate Swap prior to its May 18, 2026 termination date.

The 2025 Interest Rate Swap became effective on May 19, 2025 and has a termination date of May 18, 2027.

Under the terms of the 2025 Interest Rate Swap, the Company fixed its SOFR borrowing rate at 3.92 % on a notional amount of $ 140.0 million.

The 2025 Interest Rate Swap is not designated as a hedging instrument for accounting purposes (see Note 5).

Debt Maturities

Principal payments due on the outstanding debt in the next five fiscal years, excluding any potential payments based on excess cash flow levels, are as follows (in thousands):

Fiscal Year Ending

Principal payments due on the outstanding debt, excluding the Revolving Credit Facility, in the next five fiscal years, excluding any potential payments based on excess cash flow levels, are as follows (in thousands):

Fiscal Year Ending Term Loan

The obligations under the Credit Agreement are guaranteed by certain wholly owned subsidiaries (the “Guarantors”) of the Company that are party to that certain security agreement, which was executed in connection with the Credit Agreement.

11 unchanged sentences

Accrued interest 2,020 4,153

Income taxes payable

Deferred revenue 4,329 3,794

1 unchanged sentence

Total accrued expenses and other current liabilities $ 48,979 $ 47,410

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consisted of the following (in thousands):

Deposits $ 12,863 $ 556

Prepaid expenses 4,174 2,972

Prepaid insurance 1,615 1,538

Vendor rebate receivable 1,325 1,040

A/R other 685 1,034

Prepaid inventory 7 1,239

Other prepaids 274 157

Total prepaid expenses and other current assets $ 20,943 $ 8,536

Allowance for Bad Debt

The allowance for bad debt consisted of the following (in thousands):

2025 2024 2023

Balance at the beginning of the year $ 5,869 $ 7,544 $ 3,161

4 unchanged sentences

The warranty reserve activity consisted of the following (in thousands):

2025 2024 2023

Balance at the beginning of the fiscal year $ 2,647 $ 3,161 $ 3,990

2 unchanged sentences

Balance at the end of the fiscal year $ 3,349 $ 2,647 $ 3,161

The Company leases vehicles, manufacturing facilities, office space, land, and equipment under operating leases.

The Company leases manufacturing facilities, office space, land, and certain vehicles under operating leases.

The Company also leases certain vehicles and equipment under finance leases.

As of December 31, 2025, our operating leases substantially have remaining terms of one year to eleven years , some of which include options to extend and/or terminate the leases.

1 unchanged sentence

The components of lease expense for the years ended December 31, 2025 and 2024 were as follows (in thousands):

December 31, 2024

December 31, 2023

December 31, 2025 December 31, 2024

Operating lease expense $ 9,084 $ 8,613

5 unchanged sentences

Operating and finance lease right of use assets and lease-related liabilities as of December 31, 2025 and 2024 were as follows (in thousands):

December 31, 2024

December 31, 2023

Classification

December 31, 2025 December 31, 2024 Classification

Lease right-of-use assets:

Operating leases

Operating lease right-of-use assets

Finance leases

Operating leases $ 30,723 $ 28,259 Operating lease right-of-use assets

Finance leases 2,714 3,261 Other assets

Total lease right-of-use assets $ 33,437 $ 31,520

Lease-related liabilities

Operating leases

Current operating lease liabilities

Finance leases

Accrued expenses and other current liabilities

Operating leases

Non-current operating lease liabilities

Finance leases

Other long-term liabilities

Operating leases $ 7,630 $ 7,176 Current operating lease liabilities

Finance leases 815 779 Accrued expenses and other current liabilities

Operating leases 23,964 22,138 Non-current operating lease liabilities

Finance leases 2,125 2,678 Other long-term liabilities

Total lease liabilities $ 34,534 $ 32,771

The table below presents supplemental information related to leases as of December 31, 2025 and 2024:

December 31, 2024

December 31, 2023

December 31, 2025 December 31, 2024

Weighted-average remaining lease term (years)

5 unchanged sentences

The table below presents supplemental information related to the cash flows for operating leases recorded on the consolidated statements of cash flows (in thousands):

December 31, 2024

December 31, 2023

December 31, 2025 December 31, 2024

Cash paid for amounts included in the measurement of lease liabilities:

1 unchanged sentence

The following table summarizes fiscal year maturities of operating lease liabilities as of the year ended December 31, 2025 (in thousands):

Operating Leases

Finance Leases

Operating Leases Finance Leases Total

2026 $ 9,244 $ 1,016 $ 10,260

2027 7,409 924 8,333

2028 6,080 912 6,992

2029 5,456 428 5,884

2030 4,858 97 4,955

Thereafter 3,383 4 3,387

Total lease payments 36,430 3,381 39,811

Interest ( 4,836 ) ( 441 ) ( 5,277 )

Present value of lease liability $ 31,594 $ 2,940 $ 34,534

The following table sets forth the Company’s disaggregation of net sales by product line (in thousands):

2025 2024 2023

In-ground Swimming Pools $ 261,960 $ 259,214 $ 297,828

Covers 160,764 131,335 140,949

Liners 123,188 117,971 127,715

$ 545,912 $ 508,520 $ 566,492

The Company is subject to United States federal, state, and local income taxes, as well as other foreign income taxes.

The domestic and foreign components of its (loss) income before income taxes are as follows (in thousands):

(Loss) income before income taxes:

Current and deferred income tax expense (benefit) is composed of the following (in thousands):

Current income tax expense:

The domestic and foreign components of its income (loss) before income taxes and total income taxes paid are as follows (in thousands):

2025 2024 2023

Income (loss) before income taxes:

United States $ 9,168 $ 559 $ ( 16,303 )

Foreign 4,320 ( 9,299 ) 6,243

Total $ 13,488 $ ( 8,740 ) $ ( 10,060 )

Year Ended December 31,

2025 2024 2023

Federal $ 6,139 $ 12,271 $ 4,985

State 1,659 $ 2,520 1,050

Foreign 382 $ 684 955

Total income taxes paid $ 8,180 $ 15,475 $ 6,990

Year Ended December 31,

2025 2024 2023

Jurisdictions greater than 5%

United States Federal $ 6,139 $ 12,271 $ 4,985

Australia * * *

New Zealand * * 670

* The amount of income taxes paid during the year does not meet the five percent disaggregation threshold.

Income tax expense (benefit) from continuing operations is composed of the following (in thousands):

2025 2024 2023

Current income tax expense (benefit):

United States federal $ ( 1,314 ) $ 8,364 $ 710

United States state and local 737 1,890 515

Foreign 536 544 788

Total current tax expense ( 41 ) 10,798 2,013

Deferred income tax (benefit) expense:

United States federal 2,041 ( 7,335 ) ( 8,965 )

United States state and local 298 ( 968 ) ( 1,000 )

Foreign 66 6,625 280

Total deferred tax (benefit) $ 2,405 $ ( 1,678 ) $ ( 9,685 )

Total income tax expense (benefit):

The reconciliation of the statutory federal income tax rate with the Company’s effective income tax rate is as follows (% of Loss Before Income Taxes):

December 31, 2024

December 31, 2023

United States federal $ 727 $ 1,029 $ ( 8,255 )

United States state and local 1,035 922 ( 485 )

Foreign 602 7,169 1,068

Total income tax expense (benefit) $ 2,364 $ 9,120 $ ( 7,672 )

December 31, 2025 Year Ended

December 31, 2024 Year Ended

December 31, 2023

Federal statutory tax rate $ 2,833 21.0 % $ ( 1,835 ) 21.0 % $ ( 2,113 ) 21.0 %

Domestic state and local income taxes, net of federal effect 1,330 9.9 % 1,469 ( 16.8 ) % ( 1,411 ) 14.2 %

Research and Development Tax Credit ( 1,339 ) ( 9.9 ) % — — % — — %

Effects of Cross-Border Tax Laws

Global intangible low taxed income — — % ( 171 ) 2.0 % 337 ( 3.4 ) %

Foreign derived intangible income ( 278 ) ( 2.1 ) % 118 ( 1.4 ) % ( 45 ) 0.4 %

Canadian branch accounting ( 223 ) ( 1.7 ) % ( 1,642 ) 18.8 % ( 117 ) 1.2 %

Nontaxable or Nondeductible Items

Meals and entertainment 256 1.9 % 332 ( 3.8 ) % 298 ( 3.0 ) %

Executive compensation disallowance 778 5.8 % 242 ( 2.8 ) % 329 ( 3.3 ) %

Nondeductible stock compensation ( 504 ) ( 3.7 ) % 179 ( 2.1 ) % 2,706 ( 26.9 ) %

Foreign restructuring — — % 1,509 ( 17.3 ) % — — %

Capital loss expiration — — % 3,171 ( 36.3 ) % — — %

Partnership income ( 449 ) ( 3.3 ) % ( 242 ) 2.8 % ( 15 ) 0.1 %

Nondeductible expenses and other adjustments 264 2.0 % 32 ( 0.5 ) % ( 261 ) 2.5 %

Change in Unrecognized Tax Benefits — — % — — % ( 10,237 ) 101.8 %

Change in valuation allowance — — % ( 3,171 ) 36.3 % 3,114 ( 31.0 ) %

Foreign Tax Effects

Foreign rate differential ( 10 ) ( 0.1 ) % ( 147 ) 1.7 % 511 ( 5.1 ) %

State income tax, net of federal benefit

Uncertain tax positions

Amortization 241 1.8 % 274 ( 3.1 ) % 374 ( 3.7 ) %

Penalties and fines — — % — — % 411 ( 4.1 ) %

Restructuring gain — — % ( 111 ) 1.3 % ( 2,141 ) 21.4 %

Other 5 — % 3 — % 6 ( 0.1 ) %

Foreign rate differential 138 1.0 % ( 430 ) 4.9 % ( 25 ) 0.2 %

Nondeductible expenses and adjustments — — % — — % 542 ( 5.4 ) %

Change in valuation allowance ( 742 ) ( 5.5 ) % 8,700 ( 99.5 ) % — — %

Transaction costs not deductible for tax

Other non-deductible expense

Non-deductible stock compensation

Canadian branch income

Foreign tax restructuring

Other permanent items

Restructuring — — % 749 ( 8.6 ) % — — %

Other ( 37 ) ( 0.3 ) % 8 ( 0.1 ) % ( 7 ) 0.1 %

Foreign rate differential 97 0.7 % 82 ( 0.9 ) % 74 ( 0.7 ) %

Other 4 — % 1 — % ( 2 ) — %

Total $ 2,364 17.5 % $ 9,120 ( 104.4 ) % $ ( 7,672 ) 76.2 %

For the year ended December 31, 2025, state and local income taxes in California, Illinois, Indiana, Minnesota, New Jersey, Tennessee and Utah comprise the majority of the domestic state and local income taxes.

For the year ended December 31, 2024 these states were Illinois, Indiana, Minnesota, New Jersey, Pennsylvania, Tennessee and Utah and in 2023, they were California, Florida, Illinois, Indiana, New Jersey, Pennsylvania and Tennessee.

The following table summarizes changes in the valuation allowance (in thousands):

2025 2024 2023

Balance at January 1 $ 8,700 $ 3,114 $ —

Additions — 8,700 3,114

Deductions ( 402 ) ( 3,114 ) —

Balance at December 31 $ 8,298 $ 8,700 $ 3,114

As of December 31, 2024, after consideration of all evidence, both positive and negative, management concluded that it is not more likely than not that it would be able to realize all of its deferred tax assets of one of its foreign subsidiaries and that a valuation allowance of $ 8.7 million was necessary as of December 31, 2024.

In the prior year, there was a valuation allowance for the Company's capital loss carryforward deferred tax asset which was reversed in the current year because the capital loss carryforward expired.

As of December 31, 2025 and 2024, after consideration of all evidence, both positive and negative, management concluded that it is not more likely than not that it would be able to realize all of its deferred tax assets of one of its foreign subsidiaries and that a valuation allowance of $ 8.3 million and $ 8.7 million was necessary as of December 31, 2025 and 2024, respectively.

During the year ended December 31, 2023, there was a valuation allowance for the Company's capital loss carryforward deferred tax asset which was reversed in 2024 because the capital loss carryforward expired.

It is reasonably possible that the Company’s estimates of future taxable income may change within the next 12 months, resulting in a change to the valuation allowance in one or more jurisdictions.

The Inflation Reduction Act (“IRA”) was passed into law on August 16, 2022.

The key provisions from the IRA include the implementation of a 15% alternative book income minimum tax, an excise tax on stock buybacks, and significant tax incentives for energy and climate initiatives.

The Company evaluated the key provisions under the IRA and concluded that the provisions are not applicable to Latham for year ended December 31, 2024.

The Organization for Economic Cooperation and Development introduced a framework to implement a global 15% minimum corporate tax (“Pillar Two”).

The European Union issued a directive to its member states to enact the Pillar Two in their local laws effective after December 2023.

A number of other countries have implemented similar legislation with effective dates for the year ended 2024.

The Company has evaluated the impact of Pillar Two in the jurisdictions in which the Company operates and has determined no additional top up tax is required.

On July 4, 2025, the President signed into law the One Big Beautiful Bill Act ("OBBBA").

The OBBBA maintains the 21.0% corporate tax rate and makes permanent many of the beneficial expired and expiring tax provisions originally enacted in the Tax Cuts and Jobs Act of 2017, including the immediate expensing of domestic research and development expenditures, more favorable interest deductibility and 100 percent bonus depreciation with effective dates in 2025.

Revisions to the international tax framework are effective for the year ended December 31, 2026.

Deferred Income Taxes

1 unchanged sentence

These items are stated at the enacted tax rates that are expected to be in effect when taxes are actually paid or recovered.

The Company has elected with respect to its treatment of global intangible low-tax income ("GILTI") to account for taxes on GILTI as incurred.

Deferred income tax assets and liabilities recorded on the consolidated balance sheets as of December 31, 2025 and 2024 consist of the following (in thousands):

1 unchanged sentence

Net operating loss carryforwards $ 11,179 $ 10,001

Capital loss carryforwards

Fixed assets foreign 97 —

Inventories, net 2,105 3,082

5 unchanged sentences

Transaction costs 1,130 1,180

Future branch taxes

Operating lease liabilities 7,602 6,968

Other 1,135 2,276

Gross deferred tax assets 35,257 34,040

9 unchanged sentences

Operating lease right-of-use assets ( 7,392 ) ( 6,717 )

Other ( 4 ) —

Total deferred tax liabilities ( 60,510 ) ( 56,958 )

Net deferred tax liabilities $ ( 34,269 ) $ ( 32,347 )

ASC 740, Income Taxes , requires that the Company reduce its deferred income tax assets by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that all or a portion of a deferred tax asset will not be realized.

During 2024, the Company filed an amended return to account for the tax treatment of leases and as a result has recorded a deferred tax asset for operating lease liabilities and a deferred tax liability for operating lease right-of-use assets as of December 31, 2024.

Classification in the Consolidated Balance Sheet

Non-current deferred tax assets $ 718 $ 729

Non-current deferred tax liabilities ( 34,269 ) ( 32,347 )

Net deferred tax liabilities $ ( 33,551 ) $ ( 31,618 )

FASB ASC 740, Accounting for Income Taxes requires that the Company reduce its deferred income tax assets by a valuation allowance if, based on the weight of the available evidence, it is more likely than not that all or a portion of a deferred tax asset will not be realized.

The Company reinvests earnings of foreign operations indefinitely and, accordingly, does not provide for income taxes that could result from the remittance of such earnings.

1 unchanged sentence

Tax Uncertainties

The liability related to uncertain tax positions, exclusive of interest, was $ 6.4 million at December 31, 2022.

As of December 31, 2023, the statute of limitations expired with respect to the Company’s 2019 U.S.

Federal income tax return for which the uncertain tax position liability had been recorded.

As a result of the expiration of the statute of limitations, the Company released the uncertain tax position liability with a corresponding net tax benefit of $ 7.5 million (a gross tax benefit of $ 10.6 million from the liability release offset by tax expense of $ 3.1 million from establishing a valuation allowance on an associated deferred tax asset).

Federal income tax return

for which the uncertain tax position liability had been recorded.

There was no liability related to uncertain tax positions as of December 31, 2025 and 2024.

The Company is subject to income taxes in the U.S., certain states and numerous foreign jurisdictions.

1 unchanged sentence

Accordingly, additional provisions on federal and foreign tax-related matters could be recorded in the future as revised estimates are made or the underlying matters are settled or otherwise resolved.

The Company files a federal consolidated tax return that includes all U.S.

The Company files a federal consolidated tax return which includes all U.S.

entities as well several combined/consolidated state tax returns and separate state tax returns.

In addition, the Company files Canadian and Australian tax returns for its Canadian, Australian, and New Zealand entities.

In addition, the Company files Canadian, Australian and New Zealand tax returns for its Canadian, Australian, and New Zealand entities.

The Company is subject to the regular examination of our income tax returns by tax authorities.

5 unchanged sentences

Tax years and tax periods ended December 31, 2021 through present are open for state examination.

The Latham 2019 Illinois return is currently under examination by the state of Illinois.

Tax years and tax periods from June 30, 2022 through present are currently open for examination in Canada.

1 unchanged sentence

Tax years and tax periods from March 31, 2021 through present are currently open for examination in New Zealand.

The following is a reconciliation of the beginning and ending amount of uncertain tax positions (in thousands):

Balance at the beginning of the year

Gross amounts of increases and decreases in unrecognized tax benefits as a result of tax positions taken during a prior period

Gross amounts of increases and decreases in unrecognized tax benefits as a result of tax positions taken during the current period

The amounts of decreases in the unrecognized tax benefits relating to settlements with taxing authorities

Reductions to unrecognized tax benefits as a result of a lapse of the applicable statute of limitations

Balance at the end of the year

COMMITMENTS AND CONTINGENCIES

In the ordinary course of its business, the Company is involved in various legal proceedings involving contractual and employment claims, personal injury claims, intellectual property claims, product liability claims, and warranty claimes.

The Company does not believe there are any pending legal proceedings that will have a material impact on the Company’s financial position, results of operations, or cash flows.

From time to time, the Company may be involved in legal proceedings in the ordinary course of business, including, among other things, contract and employment claims, personal injury claims, intellectual property claims, product liability claims and warranty claims, some of which may be covered by insurance.

As of December 31, 2025, there were no legal proceedings against the Company that it believes would have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.

However, the results of any current or future legal proceedings cannot be predicted with certainty and, regardless of the outcome, the Company may incur significant costs and experience a diversion of management resources as a result of legal proceedings.

At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies.

1 unchanged sentence

STOCK-BASED COMPENSATION

On April 12, 2021, the Company’s stockholders approved the 2021 Omnibus Equity Incentive Plan (the “2021 Omnibus Equity Plan”), which became effective on April 22, 2021.

The 2021 Omnibus Equity Plan provides for the issuance of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, and other stock-based and cash-based awards.

The maximum grant date fair value of cash and equity awards that may be awarded to a non-employee director under the 2021 Omnibus Equity Plan during any one fiscal year, together with any cash fees paid to such non-employee director during such fiscal year, is $ 750,000 .

On May 2, 2023, at the 2023 annual meeting of stockholders the Company, the stockholders approved the first amendment (the “Equity Plan First Amendment”) to the Latham Group, Inc.

2021 Omnibus Equity Plan, which was previously approved by the Board of the Company.

The Equity Plan First Amendment became effective upon stockholder approval, and provides for (i) an increase by 8,000,000 shares of the share pool, i.e.

the maximum number of shares of the Company’s common stock that may be issued pursuant to awards granted under the 2021 Omnibus Equity Plan, (ii) a prohibition on recycling of shares withheld or remitted to pay taxes for all awards, (iii) a minimum vesting period of one year for all awards, with an exception for shares representing 5 % of the share pool, and (iv) a prohibition on the transfer of stock options and stock appreciation rights for value or to third-party financial institutions without stockholder approval.

Except as amended by the Equity Plan First Amendment, the other terms of the 2021 Omnibus Equity Plan remain in full force and effect.

Subsequent to the Equity Plan First Amendment, the maximum aggregate number of shares reserved for issuance under the 2021 Omnibus Equity Plan is 21,170,212 shares.

On April 12, 2021, the Company’s stockholders approved the 2021 Omnibus Equity Incentive Plan (the "2021 Omnibus Equity Plan"), which became effective on April 22, 2021, and was further amended on May 2, 2023 to, among other things, increase the maximum aggregate number of shares reserved for issuance under the 2021 Omnibus Equity Plan to 21,170,212 shares.

The following table summarizes the Company’s stock-based compensation expense (in thousands):

2025 2024 2023

Cost of sales $ — $ — $ 81

Selling, general, and administrative 9,247 7,392 18,723

The recognized income tax benefit related to stock-based compensation was $ 0.6 million, $ 0.5 million and $ 0.8 million for the years ended December 31, 2024, December 31, 2023, and December 31, 2022 respectively.

$ 9,247 $ 7,392 $ 18,804

The recognized income tax benefit related to stock-based compensation was $ 0.7 million, $ 0.6 million and $ 0.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.

As of December 31, 2025, total unrecognized stock-based compensation expense related to all unvested stock-based awards was $ 7.0 million, which is expected to be recognized over a weighted-average period of 1.78 years.

The following table sets forth the significant assumptions used in the Black-Scholes option-pricing model on a weighted-average basis to determine the fair value of stock appreciation rights awards granted:

December 31, 2023

Risk-free interest rate

Expected volatility

Expected term (in years)

Expected dividend yield

No stock appreciation rights were awarded during the year ended December 31, 2024.

The following table sets forth the significant assumptions used in the Black-Scholes option-pricing model on a weighted-average basis to determine the fair value of option awards granted:

December 31, 2022

Risk-free interest rate

Expected volatility

Expected term (in years)

Expected dividend yield

No stock options were granted under this plan during the year ended December 31, 2024.

No stock options or stock appreciation rights were awarded during the year ended December 31, 2025.

Restricted Stock Awards

The following table represents the Company’s restricted stock awards activity during the year ended December 31, 2024:

Average Grant-

Date Fair Value

Outstanding at January 1, 2024

Outstanding at December 31, 2024

The Company's restricted stock awards vested in the year ended December 31, 2024 and none are outstanding during the year ended December 31, 2025.

Restricted Stock Units

The following table represents the Company’s restricted stock units activity during the year ended December 31, 2025:

Shares Weighted-

Average Grant-

1 unchanged sentence

Outstanding at January 1, 2025 4,200,759 $ 3.25

Granted 903,766 7.12

Vested ( 1,374,814 ) 3.28

Forfeited ( 394,117 ) 3.73

Outstanding at December 31, 2025 3,335,594 $ 4.22

1 unchanged sentence

The following table represents the Company’s stock option activity during the year ended December 31, 2025:

Shares Weighted-

Exercise Price

Contract Term

per Share Weighted-

Contract Term Aggregate

Intrinsic Value

(in thousands)

(in years) (in thousands)

Outstanding at January 1, 2025 1,383,738 $ 15.20

Exercised — —

Forfeited ( 34,719 ) 15.38

Expired ( 198,307 ) 17.31

Outstanding at December 31, 2025 1,150,712 $ 14.84 4.63 $ 75

4 unchanged sentences

Stock Appreciation Rights

During the quarter ended April 1, 2023, as a portion of the annual equity award grants to the Company’s executive officers, the Compensation Committee of the Board approved stock appreciation rights for an aggregate of 790,181 shares of the Company’s common stock, with a strike price of $ 3.24 per share (the “Contingent Grants”).

At the time of such approval, the Company did not have enough shares of the Company’s common stock in the share pool under the 2021 Omnibus Equity Plan to support such grant.

As of April 1, 2023, the Contingent Grants remained subject to stockholder approval of the Equity Plan First Amendment.

On May 2, 2023, following stockholder approval of the Equity Plan First Amendment, the foregoing stock appreciation right awards became effective without condition.

The following table represents the Company’s stock appreciation rights activity during the year ended December 31, 2025:

Shares Weighted-

Exercise Price

Contract Term

per Share Weighted-

Contract Term Aggregate

Intrinsic Value

(in thousands)

(in years) (in thousands)

Outstanding at January 1, 2025 660,556 $ 3.15

Exercised ( 73,026 ) 3.24

Forfeited ( 73,027 ) 3.24

Outstanding at December 31, 2025 514,503 $ 3.12 4.81 $ 1,661

2 unchanged sentences

The aggregate intrinsic value of stock appreciation rights is calculated as the difference between the strike price of the stock appreciation rights and the fair value of the Company’s common stock for those stock appreciation rights that had strike prices lower than the fair value of the Company’s common stock.

No stock appreciation rights were granted during the year ended December 31, 2024.

The weighted average grant-date fair value of stock appreciation rights granted during the year ended December 31, 2023 was $ 1.08 per share.

No stock appreciation rights were granted during the years ended December 31, 2025 or December 31, 2024.

Performance Stock Units

During the year ended December 31, 2024, the Compensation Committee of the Board approved the grant of performance stock units (“PSUs”) as a portion of the annual equity award to the Company’s executive officers.

The PSUs will be earned at 0 % to 200 % of the target PSUs (with 100 % of PSUs being earned at target performance, and linear interpolation between threshold and target and maximum performance) based on the Company’s achievement of Adjusted EBITDA, as defined in the award agreement, over a one -fiscal year performance period ending December 31, 2024.

Any earned PSUs cliff vest on the third anniversary of the grant date.

During the year ended December 31, 2025, the Compensation Committee of the Board approved the grant of performance stock units (“PSUs”) as a portion of the annual equity award to the Company’s senior management.

The 2025 PSU program includes three equal tranches of grants.

Each tranche has an annual performance period, with performance goals established for 2025 in dollars and in 2026 and 2027 as a percentage of growth from actual performance in the prior year.

Any earned PSUs cliff vest on the third anniversary of the grant date for the first tranche.

Thirty-three percent of the target number of PSUs awarded on each grant date will be earned at 0 % to 200 % of the target PSUs based on the Company's achievement of the applicable Adjusted EBITDA performance goal (with 100 % of PSUs being earned at target performance, and linear interpolation between threshold and target and maximum performance) as defined in the award agreement, for each year of the three-year performance period beginning on January 1, 2025 and ending December 31, 2027.

Adjusted EBITDA is considered a performance condition and the grant date fair value corresponds with management’s expectation of the probable outcome of the performance condition as of the grant date.

The grant date fair value is determined based on the fair market value of the Company’s stock at market close on the grant date multiplied by the target number of shares subject to the award.

The grant date fair value was determined based on the fair market value of the Company’s stock at market close on the grant date multiplied by the target number of shares subject to the award and adjusted for management's expectation of the probable outcome of the performance condition.

The probability of achieving the performance criteria is assessed quarterly during the performance period.

Compensation expense related to unvested PSUs is recognized ratably over the service period.

Compensation expense related to unvested PSUs is recognized ratably over the performance period.

The following table represents the Company’s PSU activity during the year ended December 31, 2025:

Shares Weighted-

Outstanding at January 1, 2025 807,771 $ 4.06

Granted 325,613 7.31

Adjustment for performance achievement (1)

Forfeited ( 182,521 ) 3.67

Outstanding at December 31, 2025 (2)

941,803 $ 5.25

(1) Represents the adjustment to previously granted PSUs based on the Company’s performance as of December 31, 2025.

(2) An additional 195,254 PSUs could potentially be included if the maximum performance level of 200 % is earned for all PSUs granted during the fiscal year ended December 31, 2025

STOCKHOLDERS’ EQUITY

Offering of Common Stock

On January 11, 2022, the Company completed an offering of 13,800,000 shares of common stock, par value $ 0.0001 per share, including the exercise in full by the underwriters of their option to purchase up to 1,800,000 additional shares of common stock, at a public offering price of $ 19.50 per share.

The Company received proceeds of $ 257.7 million from this offering, net of $ 11.4 million of underwriting fees.

The proceeds of $ 257.7 million were used to purchase 13,800,000 shares of common stock from certain of the Company’s stockholders, primarily investment funds managed by Pamplona Capital Management (the “Sponsor”) and Wynnchurch Capital, L.P., and also a small percentage of shares of common stock owned by some of the Company’s directors and executive officers.

Repurchase Program

On May 10, 2022, the Board of the Company approved a stock repurchase program (the “Repurchase Program”), which authorizes the Company to repurchase up to $ 100 million of the Company’s shares of common stock over the next three years .

The Company may effect these repurchases in open market transactions, privately negotiated purchases, or other acquisitions.

The Company is not obligated to repurchase any of its shares of its common stock under the Repurchase Program and the timing and amount of any repurchases will depend on market conditions, the Company’s stock price, alternative uses of capital, the terms of the Company’s debt instruments, and other factors.

During the year ended December 31, 2022, the Company repurchased and concurrently retired 4,483,620 shares of the Company’s common stock for an aggregate amount of $ 23.0 million, pursuant to the Repurchase Program.

All of the shares were repurchased under a Rule 10b5-1 trading plan.

No shares were repurchased during the years ended December 31, 2024 or 2023.

As of December 31, 2024, $ 77.0 million remained available under our Repurchase Program.

As of and December 31, 2024 and 2023, 115,764,839 and 114,828,896 shares of common stock were issued and outstanding for accounting purposes, respectively.

NET LOSS PER SHARE

Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):

On May 10, 2022, the Board of the Company approved a stock repurchase program (the “Repurchase Program”), which authorized the Company to repurchase up to $ 100 million of the Company’s shares of common stock over the next three years .

The Company was authorized to effect these repurchases in open market transactions, privately negotiated purchases, or other acquisitions.

The Company was not obligated to repurchase any of its shares of its common stock under the Repurchase Program and the timing and amount of any repurchases was subject to market conditions, the Company’s stock price, alternative uses of capital, the terms of the Company’s debt instruments, and other factors.

The Repurchase Program ended on May 10, 2025, and the Board has not authorized a new stock repurchase program.

As of December 31, 2025 and 2024, 116,766,927 and 115,764,839 shares of common stock were issued and outstanding for accounting purposes, respectively.

NET INCOME (LOSS) PER SHARE

Basic and diluted net income (loss) per share attributable to common stockholders was calculated as follows (in thousands, except share and per share data):

Year Ended December 31,

Net loss attributable to common stockholders

2025 2024 2023

Net income (loss) attributable to common stockholders $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Weighted-average common shares outstanding

Net loss per share attributable to common stockholders:

Basic 116,424,673 115,434,828 112,899,586

Diluted 119,822,088 115,434,828 112,899,586

Net income (loss) per share attributable to common stockholders:

Basic $ 0.10 $ ( 0.15 ) $ ( 0.02 )

Diluted $ 0.09 $ ( 0.15 ) $ ( 0.02 )

The following table includes the number of shares that may be dilutive common shares in the future that were not included in the computation of diluted net loss per share because the effect was anti-dilutive:

Year Ended December 31,

2025 2024 2023

Restricted stock awards — 10,722 697,822

5 unchanged sentences

Expense Reimbursement

The Company entered into a Stockholders’ Agreement with the Sponsor and Wynnchurch Capital, L.P.

The Company entered into a Stockholders’ Agreement with Pamplona Capital Management ("the Sponsor") and Wynnchurch Capital, L.P.

on April 27, 2021.

5 unchanged sentences

The Company conducts business as one operating and reportable segment that designs, manufactures, and markets in-ground swimming pools, pool covers, and pool liners.

The Company’s Chief Executive Officer, who is the chief operating decision maker (“CODM”), reviews financial information presented on a consolidated basis for purposes of assessing financial performance and allocating resources.

The Company’s Chief Executive Officer, who is the CODM, reviews financial information presented on a consolidated basis for purposes of assessing financial performance and allocating resources.

The Company reports consolidated net income (loss), as management believes that is the measure most consistent with the measurement principles in the Company’s consolidated financial statements.

2 unchanged sentences

Year Ended December 31,

2025 2024 2023

Net sales $ 545,912 $ 508,520 $ 566,492

Other cost of sales (1)

346,540 339,078 398,293

Other selling, general and administrative expense (2)

104,078 93,138 86,385

Depreciation 21,560 16,494 13,817

Amortization (3)

29,794 27,952 26,934

Stock-based compensation expense 9,247 7,392 18,804

Strategic initiative costs (4)

2,806 3,329 4,092

Acquisition and integration related costs (5)

785 2,348 911

Restructuring charges (6)

523 512 3,727

Interest expense, net 25,805 24,840 30,916

Odessa fire (7)

Other expense (income), net

— — ( 2,600 )

Other (income) expense, net ( 3,492 ) 6,237 ( 1,004 )

Earnings from equity method investment ( 5,222 ) ( 4,060 ) ( 3,723 )

Income tax expense (benefit) 2,364 9,120 ( 7,672 )

Loss on extinguishment of debt

Underwriting fees related to offering of common stock

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

(1) Other cost of sales includes total cost of sales (as presented in the statements of operations) excluding depreciation, stock-based compensation, restructuring charges, and strategic initiative costs.

8 unchanged sentences

Net sales by geographic area was as follows (in thousands):

2025 2024 2023

United States $ 462,076 $ 429,336 $ 475,024

Canada 50,105 48,138 58,443

Australia 21,783 21,455 22,534

New Zealand 6,277 5,721 6,030

Other 5,671 3,870 4,461

Total $ 545,912 $ 508,520 $ 566,492

Our long-lived assets by geographic area, which consist of property and equipment, net were as follows (in thousands):

1 unchanged sentence

United States $ 76,736 $ 72,827

Canada 34,890 34,882

Australia 5,293 4,018

New Zealand 1,901 1,121

Total $ 118,820 $ 112,848

SUBSEQUENT EVENT

On February 5, 2026, the Company entered into an agreement to purchase four of its production facilities that are currently being leased for $ 17.6 million, $ 12.0 million of which was a deposit made during the year ended December 31, 2025.

On February 26, 2026, the Company acquired Freedom Pools, a fiberglass manufacturer and installer operating in Australia and New Zealand.

The purchase price was approximately $ 17.0 million, and the transaction was fully funded with cash on hand.

CONDENSED FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY ONLY)

4 unchanged sentences

Investment in subsidiary $ 405,861 $ 387,222

Total assets $ 405,861 $ 387,222

Liabilities and Stockholders’ Equity

17 unchanged sentences

(in thousands, except share and per share data)

Equity in net loss of subsidiary

Net loss attributable to common stockholders

Net loss per share

Net loss per share attributable to common stockholders – basic and diluted

2025 2024 2023

Equity in net income (loss) of subsidiary $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Net income (loss) attributable to common stockholders $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Net income (loss) per share

Net income (loss) per share attributable to common stockholders – basic and diluted

Basic $ 0.10 $ ( 0.15 ) $ ( 0.02 )

Diluted $ 0.09 $ ( 0.15 ) $ ( 0.02 )

Weighted-average common shares outstanding – basic and diluted

Basic 116,424,673 115,434,828 112,899,586

Diluted 119,822,088 115,434,828 112,899,586

The accompanying notes are an integral part of these condensed financial statements.

1 unchanged sentence

(Parent Company Only)

Condensed Statements of Comprehensive Loss

Condensed Statements of Comprehensive Income (Loss)

(in thousands)

Equity in other comprehensive loss of subsidiary

Comprehensive loss

2025 2024 2023

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Equity in other comprehensive income (loss) of subsidiary 1,168 ( 1,511 ) ( 6 )

Comprehensive income (loss) $ 12,292 $ ( 19,371 ) $ ( 2,394 )

The accompanying notes are an integral part of these condensed financial statements.

3 unchanged sentences

(in thousands)

2025 2024 2023

Cash flows from operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Equity in net loss of subsidiary

Net income (loss) $ 11,124 $ ( 17,860 ) $ ( 2,388 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Equity in net (income) loss of subsidiary ( 11,124 ) 17,860 2,388

Net cash provided by operating activities — — —

19 unchanged sentences

is able to transfer assets from Latham Pool Products in order to pay certain tax liabilities.

These condensed parent company financial statements have been prepared using the same accounting principles and policies described in the notes to the condensed financial statements, with the only exception being that the parent company accounts for its subsidiary using the equity method.

These condensed parent company financial statements have been prepared using the same accounting principles and policies described in Note 2 of the consolidated financial statements, with the only exception being that the parent company accounts for its subsidiary using the equity method compared to the consolidation method employed by Latham Pool Products with its subsidiaries.

During the year ended December 31, 2023, the Company repurchased and concurrently retired 4,483,620 shares of the Company’s common stock for an aggregate amount of $ 23.0 million, pursuant to the Repurchase Program.

The Company received proceeds of $ 257.7 million from this offering, net of $ 11.4 million of underwriting fees.

The proceeds of $ 257.7 million were used to purchase 13,800,000 shares of common stock from certain of the Company’s stockholders, primarily investment funds managed by the Sponsor and Wynnchurch Capital, L.P., and also a small percentage of shares of common stock owned by some of the Company’s directors and executive officers.

On April 27, 2021, the Company completed its initial public offering (the “IPO”), pursuant to which it issued and sold 23,000,000 shares of common stock, inclusive of 3,000,000 shares sold by the Company pursuant to the full exercise of the underwriters’ option to purchase additional shares.

The aggregate net proceeds received by the Company from the IPO were $ 399.3 million, after deducting underwriting discounts and commissions and other offering costs.

Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data