On this page of StockholderLetter.com we present the 4/17/2024 shareholder letter from Hayward Holdings, Inc. — ticker symbol HAYW. Reading current and past HAYW letters to shareholders can bring important insights into the investment thesis.
e (SQTER] 4ZIVZMI =IEV .R 7IZMI

WE MAKE BACKYARDS BETTER. At Hayward, we ve always been about perfecting pool and outdoor living a mission we remain committed to pursuing. We re moving toward an exciting future that s as good for the environment as it is for the pool owner. No matter what tomorrow brings, we ll still be hard at work building our better one backyard at a time.
With the Company performing at a high level, channel inventory levels largely normalized, and with the installed base of pools continuously growing, we expect to resume a sales and earnings ]uo |_ |u-f;1|ou % 8 F B F B HAYWARD | 2023 ANNUAL REPORT Total net sales reduced by 24% in 2023 as consumers faced challenging macroeconomic and geopolitical conditions and our channel partners reduced the level of inventory on hand. I am encouraged by the execution of the entire Hayward team, as we achieved strong financial and operating results amid lower sales volumes. Gross profit margin expanded to a post-IPO record of 48.1% and cash provided by operating activities increasing 59% in 2023. These are tremendous accomplishments. With the Company performing at a high level, channel inventory levels largely normalized, and with the installed base of pools continuously growing, we expect to resume a sales and earnings growth trajectory.
X The ability to innovate is one of our biggest differentiators. We continue to prioritize new product development, increasing our investment in research, development, and engineering by 10% to $25 million in 2023. We excel in critical product categories on the pool pad like IoT Controllers, Variable Speed Pumps, Water Sanitization, and LED Lighting, and intend to continue bringing industry-leading solutions to the market to support our customers and improve the pool ownership experience. % k ) We view operational excellence as a significant competitive advantage. We demonstrated our lean manufacturing and continuous improvement capabilities again in 2023, rightsizing our production levels and cost structure, further consolidating our vertically integrated manufacturing footprint, and investing in automation and other productivity initiatives. We also successfully completed our prior enterprise cost reduction program, resulting in annualized selling, general, and administrative savings of approximately $28 million. received a 2023 Regional Top Rated award from Morningstar Sustainalytics and an upgrade to an A rating by MSCI. More recently, we received the 2024 ENERGY STAR Partner of the Year Award from the U.S. Environmental Protection Agency. X e { In 2024, we will continue to pursue our mission of delivering exceptional products, outstanding service, and innovative technology to transform the experience of water. We are confident in our ability to successfully execute in this dynamic environment and remain very positive about the long-term growth outlook for the pool industry, particularly the strength of the aftermarket. Our business is well positioned to drive exceptional financial returns and value to all stakeholders in the years ahead. Thank you for your interest and investment in Hayward. I look forward to continuing our journey together in 2024 and beyond. Regards, The individuals who build and service pools are the backbone of our industry, and their voice is critical to the development of our product and commercial strategies. We believe in building strong partnerships and helping our loyal dealers grow their businesses in the years ahead, resulting in increased advocacy of Hayward products in the backyard. To that end, we increased investments in market-leading programs and events, including our Totally Hayward loyalty program, customer rewards trips, and partner summits. KEVIN P. HOLLERAN PRESIDENT AND CHIEF EXECUTIVE OFFICER, MEMBER OF THE BOARD OF DIRECTORS At Hayward, our vision to inspire happiness and well-being through safe, smart and sustainable solutions drives everything we do. We are committed to delivering impressive operational and financial results in the most responsible and sustainable way and were pleased to be recognized by third-party experts for our performance. During the year, Hayward 2023 ANNUAL REPORT | HAYWARD
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 • Benford's Law Stocks icon HAYW Benford's Law Stock Score = 88


HAYW 4/17/2024 Shareholder/Stockholder Letter Transcript:

         e                      
(SQTER] 4ZIVZMI     =IEV .R 7IZMI  


WE MAKE
BACKYARDS
BETTER.
At Hayward, we   ve always been about perfecting
pool and outdoor living    a mission we remain
committed to pursuing. We   re moving toward an
exciting future that   s as good for the environment
as it is for the pool owner. No matter what
tomorrow brings, we   ll still be hard at work
building our better   one backyard at a time.

With the Company performing
at a high level, channel inventory
levels largely normalized, and
with the installed base of pools
continuously growing, we expect
to resume a sales and earnings
]uo  |_ |u-f;1|ou      
%       8                                     
F                                         B                 
                                       F                                          



                     B                                                         




HAYWARD | 2023 ANNUAL REPORT

Total net sales reduced by 24% in 2023 as
consumers faced challenging macroeconomic
and geopolitical conditions and our channel
partners reduced the level of inventory on hand.
I am encouraged by the execution of the entire
Hayward team, as we achieved strong financial
and operating results amid lower sales volumes.
Gross profit margin expanded to a post-IPO
record of 48.1% and cash provided by operating
activities increasing 59% in 2023. These are
tremendous accomplishments. With the Company
performing at a high level, channel inventory levels
largely normalized, and with the installed base of
pools continuously growing, we expect to resume a
sales and earnings growth trajectory.

                     X                  
The ability to innovate is one of our biggest
differentiators. We continue to prioritize new
product development, increasing our investment
in research, development, and engineering by
10% to $25 million in 2023. We excel in critical
product categories on the pool pad like IoT
Controllers, Variable Speed Pumps, Water
Sanitization, and LED Lighting, and intend to
continue bringing industry-leading solutions
to the market to support our customers and
improve the pool ownership experience.
%                       k                     )                  
We view operational excellence as a significant
competitive advantage. We demonstrated our
lean manufacturing and continuous improvement
capabilities again in 2023, rightsizing our
production levels and cost structure, further
consolidating our vertically integrated
manufacturing footprint, and investing in
automation and other productivity initiatives.
We also successfully completed our prior
enterprise cost reduction program, resulting in
annualized selling, general, and administrative
savings of approximately $28 million.
received a 2023    Regional Top Rated    award
from Morningstar Sustainalytics and an upgrade
to an    A    rating by MSCI. More recently, we
received the 2024 ENERGY STAR    Partner of
the Year Award from the U.S. Environmental
Protection Agency.
X             e                  {            
In 2024, we will continue to pursue our mission
of delivering exceptional products, outstanding
service, and innovative technology to transform
the experience of water. We are confident in our
ability to successfully execute in this dynamic
environment and remain very positive about the
long-term growth outlook for the pool industry,
particularly the strength of the aftermarket. Our
business is well positioned to drive exceptional
financial returns and value to all stakeholders in
the years ahead.
Thank you for your interest and investment
in Hayward. I look forward to continuing our
journey together in 2024 and beyond.
Regards,

The individuals who build and service pools
are the backbone of our industry, and their
voice is critical to the development of our
product and commercial strategies. We believe
in building strong partnerships and helping
our loyal dealers grow their businesses in the
years ahead, resulting in increased advocacy of
Hayward products in the backyard. To that end,
we increased investments in market-leading
programs and events, including our Totally
Hayward loyalty program, customer rewards
trips, and partner summits.
KEVIN P. HOLLERAN
PRESIDENT AND CHIEF EXECUTIVE OFFICER,
MEMBER OF THE BOARD OF DIRECTORS

At Hayward, our vision     to inspire happiness
and well-being through safe, smart and
sustainable solutions     drives everything we
do. We are committed to delivering impressive
operational and financial results in the most
responsible and sustainable way and were
pleased to be recognized by third-party experts
for our performance. During the year, Hayward
2023 ANNUAL REPORT | HAYWARD


shareholder letter icon 4/17/2024 Letter Continued (Full PDF)
 

HAYW Stockholder/Shareholder Letter (Hayward Holdings, Inc.) 4/17/2024 | www.StockholderLetter.com
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