8-K: SiteOne Landscape Supply Q1 2026 Earnings

SiteOne Landscape Supply reported mixed Q1 2026 results with a slight increase in net sales but a decrease in organic daily sales, alongside improved gross margins and Adjusted EBITDA growth.

Summary

• SiteOne Landscape Supply reported first quarter 2026 net sales of $940.1 million, a slight increase of $0.7 million compared to the prior year.
• Organic Daily Sales decreased by 1% due to unfavorable weather conditions impacting sales volume, despite positive pricing.
• Gross profit rose by 3% to $318.8 million, with gross margin improving by 90 basis points to 33.9%.
• Selling, general and administrative (SG&A) expenses increased as a percentage of net sales to 37.2%, primarily due to lower organic sales volume, though Base Business SG&A was flat on an adjusted basis.
• The company reported a net loss attributable to SiteOne of $26.6 million, a slight improvement from $27.3 million in the prior year.
• Adjusted EBITDA increased by 14% to $25.5 million, with the Adjusted EBITDA margin improving by 30 basis points to 2.7%.
• SiteOne completed the acquisitions of Bourget Flagstone and Reinders during the quarter and repurchased $20.0 million of shares.
• The company amended its ABL Facility, extending its maturity to April 2031.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral to slightly positive result, as the company navigated challenging weather and market conditions to achieve modest growth in key profitability metrics like gross margin and Adjusted EBITDA, while maintaining its full-year outlook.

Positives

• Net sales increased by $0.7 million to $940.1 million.
• Gross profit increased by 3% to $318.8 million.
• Gross margin improved by 90 basis points to 33.9%, driven by higher price realization and commercial initiatives.
• Adjusted EBITDA increased by 14% to $25.5 million.
• Adjusted EBITDA margin improved by 30 basis points to 2.7%.
• Net loss attributable to SiteOne decreased to $26.6 million from $27.3 million in the prior year.
• Cash used in operating activities decreased by $7.5 million to $122.1 million.
• Completed acquisitions of Bourget Flagstone and Reinders.
• Repurchased $20.0 million of shares under the share repurchase authorization.
• Amended ABL Facility and extended maturity to April 2031.

Negatives

• Organic Daily Sales decreased by 1% due to unfavorable weather conditions and lower sales volumes.
• SG&A as a percentage of Net sales increased by 70 basis points to 37.2% due to lower organic sales volume.
• Net loss attributable to SiteOne was $26.6 million.

Risks

• Unfavorable weather conditions impacting sales volume.
• Macroeconomic uncertainty negatively affecting new residential construction and repair/upgrade markets.
• Potential for supply chain disruptions, product or labor shortages.
• Cyclicality in residential and commercial construction markets.
• General business, economic, and financial market conditions.
• Volatility in product prices and operating costs.
• Risks associated with acquisitions and integration.
• Cybersecurity incidents and IT system failures.

Future Outlook

For the full year 2026, SiteOne expects overall prices to increase 2% to 3%. Despite a later start to the spring selling season due to weather, sales volume has improved in April. The company anticipates end market demand to be down modestly for the full year 2026 due to macroeconomic uncertainty affecting new residential construction and repair/upgrade markets. With commercial initiatives, sales volume is expected to be flat, leading to low single-digit Organic Daily Sales growth. Gross margin is expected to expand through increased pricing and private label growth. SG&A leverage is anticipated through operational initiatives. Including acquisitions, Adjusted EBITDA margin is expected to continue expanding in 2026. The fiscal year 2026 includes an extra week, which is expected to reduce Adjusted EBITDA by $4 million to $5 million. Full year 2026 Adjusted EBITDA is projected to be in the range of $425 million to $455 million, excluding unannounced acquisitions.

Management Comments

• "We are pleased with our first quarter performance as we more than offset the weather and market-related softness in sales volume and delivered Adjusted EBITDA growth with meaningful gross margin improvement and continued tight SG&A management."
• "Our teams are executing our commercial and operational initiatives well, which is allowing us to gain market share and expand our Adjusted EBITDA margin."
• "During the quarter, we were also very pleased to complete the acquisition of Reinders, a strong fifth-generation market leader in the Midwest, displaying the power of our acquisition strategy."
• "Looking ahead, we remain confident in our ability to navigate the near-term challenges, deliver superior value to our customers and suppliers, and execute our strategy to drive sustained performance and growth for shareholders."
• "We achieved 3% growth in pricing during the quarter, and we expect overall prices in 2026 to increase 2% to 3% for the full year."
• "In terms of end markets, we believe that the recent increase in macroeconomic uncertainty is negatively affecting the already weak new residential construction and the more resilient repair and upgrade end markets, more than offsetting maintenance growth and solid demand in new commercial construction."
• "As a result, we believe that overall end market demand will be down modestly for the full year 2026."
• "With the benefit of our commercial initiatives, we expect sales volume to be flat, yielding low single-digit Organic Daily Sales growth for the full year."
• "We also expect to expand our Gross margin through increased price realization and strong growth with private label products and small customers."
• "We expect to achieve SG&A leverage through our operational initiatives, which include focus branch improvements and delivery cost reduction."
• "Overall, including contributions from acquisitions, we expect to continue expanding our Adjusted EBITDA margin in 2026."

Industry Context

StockSavvy.ai notes that SiteOne Landscape Supply's Q1 2026 results reflect broader industry challenges including adverse weather impacting seasonal sales and macroeconomic uncertainty affecting construction and renovation markets. The company's ability to improve gross margins and Adjusted EBITDA despite lower organic sales volume highlights its operational initiatives and pricing power, which are key differentiators in a competitive landscape.

Stakeholder Impact

• Shareholders: Potential for sustained performance and growth, with continued expansion of Adjusted EBITDA margin. Share repurchases also benefit shareholders.
• Customers: Benefit from SiteOne's commercial initiatives and efforts to deliver superior value.
• Suppliers: Benefit from SiteOne's strategy to deliver superior value.
• Employees: Continued focus on operational initiatives and potential for growth within the company.

Next Steps

• Continue executing commercial and operational initiatives.
• Drive sustained performance and growth for shareholders.
• Navigate near-term challenges in end markets.
• Pursue unannounced acquisitions.

Key Dates

Recommendation

The company demonstrated resilience by improving margins and Adjusted EBITDA despite challenging weather and market conditions, and maintained its full-year guidance. However, the modest sales growth and continued macroeconomic uncertainty warrant a 'hold' rating until clearer signs of market recovery and sustained organic growth emerge.

Keywords

SiteOne Landscape Supply, 8-K, Q1 2026 Earnings, Landscape Supplies, Adjusted EBITDA, Gross Margin, Acquisitions, Financial Results