- Consolidated Net Sales Growth Net sales rose 1% to $154.4M, with maintenance products up 2% to $148.9M (96% of total sales).
- EMEA Segment Surge Sales increased 5% to $58.7M, driven by a 27% rise in WD-40 Specialist sales.
- Gross Margin Expansion Gross margin improved 140 bps to 56.2%, aided by lower chemical costs and higher pricing.
- Adjusted EBITDA Margin Decline Margin dipped to 17% from 18%, but expected to rebound to 20-22% post-home care divestiture impact.
- Dividend Increase Quarterly dividend raised 8% to $1.02/share, prioritizing 50%+ payout ratio and $7.8M in share repurchases.
Segment Performance
The Americas segment was the bright spot, with sales increasing 4% to $71.9 million, driven by higher sales of maintenance products in the US and Latin America. EMEA sales also grew 5% to $58.7 million, fueled by a 27% increase in WD-40 Specialist sales. However, Asia Pacific sales declined 10% to $23.9 million, due to lower sales of WD-40 Multi-Use Product in distributor markets.
Cost Structure and Guidance
The company's cost of doing business was 40% of net sales, compared to 37% last year, due to strategic investments in people and brand-building efforts. WD-40 reaffirmed its full-year 2026 guidance, expecting a strong rebound in sales later in the fiscal year. The company is focused on its four by four strategic framework, which includes lead geographic expansion, accelerating premiumization, driving WD-40 Specialist growth, and turbocharging digital commerce.
Valuation and Dividend Yield
With a P/E Ratio of 30.74 and an EV/EBITDA ratio of 24.65, WD-40's valuation appears to be pricing in a significant growth premium. However, the company's Dividend Yield of 1.85% and a disciplined capital allocation strategy, with a target of returning greater than 50% of earnings to stockholders through dividends, may provide a floor for the stock. The recent quarterly cash dividend of $1.02 per share, an increase of more than 8% over the prior quarter, is a positive sign.