Q2 2025 Leslie's Inc Earnings Call Transcript
Key Points
- Leslies Inc (LESL) achieved a 174 basis point improvement in conversion rates, attributed to enhanced in-stock levels and team expertise.
- The company successfully launched 26 Local Fulfillment Centers (LFCs) on time and under budget, improving inventory management and customer service.
- Leslies Inc (LESL) introduced a new loyalty program with tiered benefits, aiming to increase customer engagement and retention.
- The partnership with Uber for same-day delivery is expected to enhance customer convenience and optimize asset utilization.
- Pro sales showed a 700 basis point improvement year over year, indicating strong momentum in the professional segment.
- Sales declined by 6% year over year, primarily due to weaker foot traffic and colder temperatures affecting demand.
- Gross margin decreased from 28.8% to 24.8%, impacted by increased distribution center and occupancy costs, as well as mix and volume challenges.
- SG&A expenses rose to 52.1% of net sales, driven by higher labor costs and executive transition expenses.
- The company reported an adjusted EBITDA loss of $36 million for the quarter, reflecting ongoing financial challenges.
- Leslies Inc (LESL) faces tariff exposure estimated at $10 to $12 million annually, which could impact product costs.
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Good afternoon and welcome to the fiscal 2nd quarter 2025 earnings conference call for Leslie's. At this time, all participants are in a listen-only mode. Following the prepared remarks, management will conduct a question and answer session.
If you require any operator assistance during the conference call, please press 0 on the telephone keypad. As a reminder, this conference call is being recorded and will be available for replay later today on the company's investor relations website.
I will now turn the call over to Elizabeth Eisleben, senior Vice President, investor and public relations.
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Good afternoon and thank you for joining us today to discuss our fiscal 2nd quarter that ended March 29th and the progress we're making across our strategic initiatives.
I'm joined today by Jason McDonnell, our Chief
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