Financial Analysis

"12. Commitments and Contingencies Litigation The Company is involved in litigation arising in the normal course of business, including involving product liability claims. Where appropriate, these matters have been submitted to the Companys insurance carrier. The Company determines whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. It is not possible to quantify the ultimate liability, if any, in these matters. On August 2, 2023, a securities class action complaint was filed in the United States District Court for the District of New Jersey against the Company and certain of its current directors and officers (Kevin Holleran and Eifion Jones) and MSD Partners, L.P. and CCMP Capital Advisors, LP on behalf of a putative class of stockholders who acquired shares of the Companys Common Stock between March 2, 2022 and July 27, 2022. That action is captioned City of Southfield Fire and Police Retirement System vs. Hayward Holdings, Inc., et al ., 2:23-cv-04146-WJM-ESK (D.N.J.) (City of Southfield). On September 28, 2023, a second, related securities class action complaint was filed in the United States District Court for the District of New Jersey against the Company and certain of its current directors and officers (Kevin Holleran and Eifion Jones) and MSD Partners, L.P. and CCMP Capital Advisors, LP on behalf of a putative class of stockholders who acquired shares of the Companys Common St …

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15. Stock-based Compensation Stock-based compensation expense recorded in the unaudited condensed consolidated statements of operations for equity-classified stock-based awards for the three and six months ended June 27, 2026 was $4.0 million and $7.6 million, respectively, and was $3.4 million and $6.3 million, respectively, for the three and six months ended June 28, 2025. The Company has established two equity incentive plans, the 2021 Equity Incentive Plan (the 2021 Plan ), as described below, and the 2017 Equity Incentive Plan. The Company no longer grants awards under the 2017 Equity Incentive Plan. 2021 Equity Incentive Plan In March 2021, the Company adopted the 2021 Plan. Under the 2021 Plan, up to 13,737,500 shares of Common Stock may be granted to employees, directors and consultants in the form of stock options, restricted stock units and other stock-based awards. The terms of awards granted under the 2021 Plan are determined by the Compensation Committee of the Board of Directors, subject to the provisions of the 2021 Plan. Options granted under the 2021 Plan expire no later than 10 years from the date of grant. The vesting period of stock options and restricted stock units granted under the 2021 Plan is generally three years from the date of grant. During the six months ended June 27, 2026, the Company granted 692,439 time-based restricted stock units and 322,873 performance-based restricted stock units (at the target performance level) under the 2021 Plan with …

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9. Fair Value Measurements The Company is required to disclose the estimated fair values of all financial instruments, even if they are not carried at their fair value. The fair values of financial instruments are estimates based upon market conditions and perceived risks. These estimates require managements judgment and may not be indicative of the future fair values of the assets and liabilities. The accounting guidance for fair value measurements and disclosures establishes a three-level fair value hierarchy: Level 1 - Inputs are based on quoted prices in active markets for identical assets and liabilities. Level 2 - Inputs are based on observable inputs other than quoted prices in active markets for identical or similar assets and liabilities. Level 3 - One or more inputs are unobservable and significant. Financial and nonfinancial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Companys financial instruments include cash and cash equivalents, short-term investments, accounts receivable, and accounts payable. The carrying amount of these instruments approximate fair value because of their short-term nature. The Companys interest rate swaps, net investment hedge and foreign exchange contracts are measured in the financial statements at fair value on a recurring basis. The fair values of these instruments are estimated using industry standard valuation models using market-based …

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6. Income Taxes The Companys effective tax rate for the three months ended June 27, 2026 and June 28, 2025 was 23.0% and 24.6%, respectively, after discrete items. The change in the Companys effective tax rate was primarily driven by lower state taxes. The Companys effective tax rate for the six months ended June 27, 2026 and June 28, 2025 was 22.8% and 24.3%, respectively. The change in the Companys effective tax rate was primarily driven by lower state taxes. The Company will recognize a tax benefit in the financial statements for an uncertain tax position only if the Companys assessment is that the position is more likely than not (i.e., a likelihood greater than 50 percent) to be allowed by the tax jurisdiction based solely on the technical merits of the position. The term tax position refers to a position in a previously filed tax return or a position expected to be taken in a future tax return that is reflected in measuring current or deferred income tax assets and liabilities for financial reporting purposes. There were uncertain tax positions of $0.5 million as of both June 27, 2026 and December 31, 2025. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Ma …

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13. Leases The Companys operating and finance lease portfolio is described in Note 15. Leases of Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025. Supplemental cash flow information related to leases was as follows (in thousands): Six Months Ended June 27, 2026 June 28, 2025 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,128 $ 2,783 Finance leases 631 344 Supplemental balance sheet information related to leases was as follows (in thousands): June 27, 2026 December 31, 2025 Operating leases Other non-current assets $ 49,999 $ 54,242 Accrued expenses and other liabilities 8,816 10,048 Other non-current liabilities 48,134 51,351 Total operating lease liabilities 56,950 61,399 Finance leases Property, plant and equipment 4,882 4,262 Accumulated depreciation (975) (588) Property, plant and equipment, net 3,907 3,674 Current maturities of long-term debt 1,005 839 Long-term debt 2,899 2,800 Total finance lease liabilities $ 3,904 $ 3,639 …

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7. Long-Term Debt, Net Long-term debt, net, consists of the following (in thousands): June 27, 2026 December 31, 2025 Term Facility, due June 23, 2033 $ 960,000 $ 955,000 Other bank debt 1,317 4,826 Finance lease obligations 3,904 3,639 Subtotal 965,221 963,465 Less: Current portion of the long-term debt (10,811) (13,261) Less: Unamortized debt issuance costs (8,797) (6,657) Total $ 945,613 $ 943,547 On June 23, 2026, Hayward Industries, Inc. (the US Borrower), a New Jersey corporation and a wholly owned subsidiary of the Company, Hayward Pool Products Canada, Inc. / Produits de Piscines Hayward Canada, Inc., a Canadian federal corporation and a wholly owned subsidiary of the Company (together with the US Borrower, the Borrowers), and Hayward Intermediate, Inc., a Delaware corporation and a wholly owned subsidiary of the Company, entered into an Amended and Restated First Lien Credit Agreement (the Credit Agreement), which Credit Agreement refinanced in full and extended the maturities of the Borrowers previously outstanding term loans. In connection with the entry into the Credit Agreement, the Borrowers previously outstanding asset-based revolving credit facility was terminated on June 23, 2026 with no outstanding borrowings. Pursuant to the Credit Agreement, the Company (i) borrowed $960.0 million of new term loans (the Term Loans) in U.S. dollars under a seven-year term loan facility (the Term Facility) and (ii) entered into a $425.0 million five-year revolving credit fac …

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Recently Issued Accounting Standards Disaggregation of Income Statement Expenses In November 2024, the Financial Accounting Standards Board ( FASB ) issued Accounting Standards Update ( ASU ) 2024-03, Disaggregation of Income Statement Expenses , which includes requirements that an entity disclose in the notes to the financial statements specified information about certain costs and expenses, including the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation and (d) intangible asset amortization included in each relevant expense caption presented on the statement of operations. The standard also requires disclosure of a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, as well as the total amount of selling expenses and an entitys definition of selling expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is evaluating the impact of the standard on its disclosures. Intangibles - Goodwill and Other Internal-Use Software In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-Use Software , which modernizes the accounting for internal-use software by eliminating references to prescriptive development stages and replacing them with a principles-based capital …

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17. Related-Party Transactions During the three and six months ended June 27, 2026 and June 28, 2025, the Company did not incur any significant related-party transactions.

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16. Acquisitions and Restructuring Acquisition and restructuring related expense, net consists of the following (in thousands): Three Months Ended Six Months Ended June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Business restructuring costs (income) $ 748 $ (8) $ 1,253 $ 205 Acquisition transaction and integration costs 1,573 3,286 Total $ 748 $ 1,565 $ 1,253 $ 3,491 Restructuring During the three months ended June 27, 2026, the Company incurred $0.7 million of costs as part of a transformation program in E&RW. During the six months ended June 27, 2026, the Company incurred $1.3 million in costs which includes costs for a transformation program in E&RW and termination benefits for the restructuring of several teams in NAM. During the three months ended June 28, 2025, the Company incurred a reduction in expense of $0.2 million to finalize the relocation of its corporate office functions to Charlotte, North Carolina from Berkeley Heights, New Jersey. The finalized total cost to execute the program was $5.7 million. The following tables summarize the status of the Companys restructuring related expense and related liability balances (in thousands): 2026 Activity Liability as of January 1, 2026 Costs Recognized Cash Payments Liability as of June 27, 2026 One-time termination benefits $ 831 $ 1,253 $ (883) $ 1,201 Facility-related 9 (9) Other 8 (8) Total $ 848 $ 1,253 $ (900) $ 1,201 2025 Activity Liability as of January 1, 2025 Costs Recognized Cash Payments Liabi …

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3. Revenue The following table disaggregates net sales between product groups and geographic regions, respectively (in thousands): Three Months Ended Six Months Ended June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Product groups Residential pool $ 283,389 $ 267,680 $ 507,191 $ 469,458 Commercial pool 21,047 19,413 38,964 34,423 Flow control 13,942 12,510 27,439 24,563 Total $ 318,378 $ 299,603 $ 573,594 $ 528,444 Geographic United States $ 257,642 $ 235,524 $ 449,786 $ 408,596 Canada 20,016 19,651 37,669 33,648 Europe 26,462 27,549 58,227 55,507 Rest of World 14,258 16,879 27,912 30,693 Total International 60,736 64,079 123,808 119,848 Total $ 318,378 $ 299,603 $ 573,594 $ 528,444

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10. Segments and Related Information The Companys operational and management structure is aligned to its key geographies and go-to market strategy resulting in two reportable segments: North America (NAM) and Europe & Rest of World (E&RW). Operating segments have not been aggregated to form the reportable segments. The Companys CODM is the President and Chief Executive Officer. The Company determined its reportable segments based on how the Companys CODM reviews the Companys operating results in assessing performance and allocating resources. The CODM uses segment income in assessing performance of and allocating resources to the reportable segments. Segment income is defined as net sales less cost of sales, less segment selling, general and administrative expense (SG&A) and segment research development and engineering expense (RD&E), excluding acquisition and restructuring related expense, as well as amortization of intangible assets recorded within SG&A expense. The CODM does not evaluate reportable segments using asset information as these are managed on an enterprise-wide basis. The accounting policies of the segments are the same as those of Hayward. NAM manufactures and sells residential and commercial swimming pool equipment and supplies as well as equipment that controls the flow of fluids. E&RW manufactures and sells residential and commercial swimming pool equipment and supplies. The Company sells its products primarily through distributors a …

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14. Stockholders Equity Preferred Stock The Companys Second Restated Certificate of Incorporation authorizes the Company to issue up to 100,000,000 shares of preferred stock, $0.001 value per share, all of which is undesignated. Common Stock The Companys Second Restated Certificate of Incorporation authorizes the Company to issue up to 750,000,000 shares of Common Stock, $0.001 value per share. Each share of Common Stock is entitled to one vote on all matters submitted to a vote of the Companys stockholders. The holders of Common Stock are entitled to receive dividends, if any, as may be declared by the Board of Directors. Dividends paid For the three and six months ended June 27, 2026 and June 28, 2025, no dividends were declared or paid to the Companys common stockholders. Share Repurchase Program On July 28, 2025, the Board of Directors authorized the Companys share repurchase program (the Share Repurchase Program) such that the Company is authorized to repurchase from time to time up to an aggregate of $450 million of its outstanding shares of Common Stock, which authorization expires on July 28, 2028. During the three months ended June 27, 2026, the Company repurchased approximately 4.1 million shares of Common Stock in the open market at an average price per share of $14.24, for an aggregate consideration of approximately $58.0 million, as part of the Share Repurchase Program. For the six months ended June 27, 2026, the Company repurchased approximately 4.4 million shar …

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