Q2 2026 Vestis Corp Earnings Call Transcript
Key Points
- Vestis Corp (VSTS) reported a significant improvement in adjusted EBITDA, marking the first year-over-year growth in over two years, with a 19% increase to approximately $75 million.
- The company achieved a $0.02 reduction in cost per pound, contributing to improved operating leverage and financial performance.
- Operational excellence initiatives led to a 270 basis point improvement in on-time delivery, an 11% increase in plant productivity, and a 4% decline in customer complaints.
- Vestis Corp (VSTS) successfully sold two inactive non-operating facilities, generating $6.5 million in net proceeds used to repay debt.
- The company raised its full-year fiscal 2026 guidance for adjusted EBITDA and free cash flow, reflecting strong execution against its transformation plan.
- Revenue for the second quarter was approximately $659 million, down about $6 million or 0.9% year over year, primarily due to a 1.2% reduction in volume.
- Volume declined by approximately 6 million pounds year over year, with the lost volume carrying an average revenue per pound of approximately $1, indicating lower quality revenue.
- The company is still in the early stages of its transformation plan, with more work needed to fully realize the benefits of its strategic initiatives.
- Despite improvements, the company faces challenges in maintaining revenue growth, with expectations for flat to down 2% revenue for fiscal 2026 compared to the previous year.
- Vestis Corp (VSTS) is navigating a competitive market environment, with potential impacts from industry consolidation and the need to adapt its strategy accordingly.
Welcome to the Vestis Corporation fiscal second-quarter 2026 earnings conference call. I would now like to turn the call over to Stefan Neely with Investor Relations.
Thank you, operator, and thank you all for joining us on the call this morning. Leading the call with me today is Jim Barber, President and Chief Executive Officer; and Adam Bowen, Interim Chief Financial Officer. Also with us on the call today is Bill Seward, Chief Operating Officer. Jim and Adam will provide prepared remarks, and then we will open the line to questions.
Before I turn the call over to Jim, I want to remind everyone that today's discussion contains forward-looking statements about future business and financial expectations. The Private Securities Litigation Reform Act of 1995 provides a safe harbor from civil litigation for such forward-looking statements. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in
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