Q2 2026 FGI Industries Ltd Earnings Call
Speaker #1: Good day, and welcome to the FGI Industries Inc. second quarter 2026 results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
Operator: Good day, and welcome to the FGI Industries Ltd. Second Quarter 2026 Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Jae Chung, Chief Financial Officer. Please go ahead.
Operator: Good day, and welcome to the FGI Industries Ltd. Second Quarter 2026 Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Jae Chung, Chief Financial Officer. Please go ahead.
Speaker #1: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your telephone keypad.
Speaker #1: To withdraw your question, please press star, then 2. Please note this event is being recorded. I would now like to turn the conference over to Jay Chung, Chief Financial Officer.
Speaker #1: Please go ahead.
Speaker #2: Thank you. Welcome to FGI Industries 2026 second quarter results conference call. Leading the call today are Chief Executive Officer David Bruce and Chief Financial Officer Jay Chung.
Jae Chung: Thank you. Welcome to FGI Industries 2026 second quarter results conference call. Leading the call today are Chief Executive Officer, David Bruce, and Chief Financial Officer, Jae Chung. We issued a press release after the market closed yesterday detailing our recent operational and financial results. I would like to remind you that management's commentary and responses to questions on today's conference call may include forward-looking statements, which by their nature are uncertain and outside of the company's control. Although these forward-looking statements are based on management's current expectations and beliefs, actual results may differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the Risk Factors section of our latest filings with the SEC, including our Form 10-K for the year ended 31 December 2025.
Jae Chung: Thank you. Welcome to FGI Industries 2026 second quarter results conference call. Leading the call today are Chief Executive Officer, David Bruce, and Chief Financial Officer, Jae Chung. We issued a press release after the market closed yesterday detailing our recent operational and financial results. I would like to remind you that management's commentary and responses to questions on today's conference call may include forward-looking statements, which by their nature are uncertain and outside of the company's control. Although these forward-looking statements are based on management's current expectations and beliefs, actual results may differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the Risk Factors section of our latest filings with the SEC, including our Form 10-K for the year ended 31 December 2025.
Speaker #2: We issued a press release after the market closed yesterday, detailing our recent operational and financial results. I would like to remind you that management's commentary and responses to questions on today's conference call may include forward-looking statements which, by their nature, are uncertain and outside of the company's control.
Speaker #2: Although these forward-looking statements are based on management's current expectations and beliefs, actual results may differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the risk factors section of our latest filings with the SEC, including our Form 10-K for the year ended December 31, 2025.
Speaker #2: Additionally, please note that you can find reconciliations of historical non-GAAP financial measures in the press release issued yesterday and in the appendix of this presentation, which is available on the company's website.
Jae Chung: Additionally, please note that you can find reconciliations of historical non-GAAP financial measures in the press release issued yesterday and in the appendix of this presentation, which is available on the company's website. Today's call will begin with a performance review and strategic update from Dave Bruce, followed by a financial review from Jae Chung. At the conclusion of these prepared remarks, we will open the line for questions. With that, I'll turn the call over to Dave.
Jae Chung: Additionally, please note that you can find reconciliations of historical non-GAAP financial measures in the press release issued yesterday and in the appendix of this presentation, which is available on the company's website. Today's call will begin with a performance review and strategic update from Dave Bruce, followed by a financial review from Jae Chung. At the conclusion of these prepared remarks, we will open the line for questions. With that, I'll turn the call over to Dave.
Speaker #2: Today's call will begin with a performance review and strategic update from Dave Bruce, followed by a financial review from Jay Chung. At the conclusion of these prepared remarks, we will open the line for questions.
Speaker #2: With that, I'll turn the call over to Dave.
Speaker #3: Thank you, Jay. Good morning, everyone, and thank you for joining our call today. I am pleased to report another quarter of revenue growth and improved operating expense performance for FGI.
David Bruce: Thank you, Jae. Good morning, everyone, and thank you for joining our call today. I am pleased to report another quarter of revenue growth and improved operating expense performance for FGI. Revenue increased 2.9% year over year in the second quarter, and we remain disciplined in managing our cost structure, delivering lower operating expenses while continuing to invest in our brands, products, and channels for our BPC growth strategy. These efforts continue to strengthen our market position and create new opportunities for long-term growth. Our strongest performance came from our sanitaryware and shower systems businesses, both of which delivered year over year revenue growth. Sanitaryware benefited from the normalization of customer purchasing activity following last year's tariff related disruptions, along with contributions from recently launched customer programs. Our shower systems business also continued to gain traction as new products and expanded customer distribution contributed to growth.
David Bruce: Thank you, Jae. Good morning, everyone, and thank you for joining our call today. I am pleased to report another quarter of revenue growth and improved operating expense performance for FGI. Revenue increased 2.9% year over year in the second quarter, and we remain disciplined in managing our cost structure, delivering lower operating expenses while continuing to invest in our brands, products, and channels for our BPC growth strategy. These efforts continue to strengthen our market position and create new opportunities for long-term growth. Our strongest performance came from our sanitaryware and shower systems businesses, both of which delivered year over year revenue growth. Sanitaryware benefited from the normalization of customer purchasing activity following last year's tariff related disruptions, along with contributions from recently launched customer programs. Our shower systems business also continued to gain traction as new products and expanded customer distribution contributed to growth.
Speaker #3: Revenue increased 2.9% year over year in the second quarter, and we remain disciplined in managing our cost structure delivering lower operating expenses while continuing to invest in our brands, products, and channels where BPC growth strategy.
Speaker #3: These efforts continue to strengthen our market position and create new opportunities for long-term growth. Our strongest performance came from our sanitary wear and showers systems businesses, both of which delivered year over year revenue growth.
Speaker #3: Sanitary wear benefited from the normalization of customer purchasing activity following last year's tariff-related disruptions. Along with contributions from recently launched customer programs, our shower systems business also continued to gain traction as new products and expanded customer distribution contributed to growth.
Speaker #3: While market conditions remain mixed, particularly within our bath furniture and other product categories, we continue to manage the business with discipline and remain focused on opportunities where we see the strongest long-term potential.
David Bruce: While market conditions remain mixed, particularly within our bath furniture and other product categories, we continue to manage the business with discipline and remain focused on opportunities where we see the strongest long-term potential. Looking ahead, we expect Covered Bridge Cabinetry to resume growth in the H2 of the year. We also expect continued momentum in our shower systems business as recently introduced products and customer programs continue to expand, providing additional opportunities for growth through the remainder of 2026. Although the external environment continues to evolve, including ongoing trade and tariff developments, I am proud of how our team has remained focused on execution. Their ability to adapt to changing market conditions while continuing to serve our customers has positioned FGI well for the remainder of the year. With that, I'll turn the call over to Jae for a more detailed review of our financial results.
David Bruce: While market conditions remain mixed, particularly within our bath furniture and other product categories, we continue to manage the business with discipline and remain focused on opportunities where we see the strongest long-term potential. Looking ahead, we expect Covered Bridge Cabinetry to resume growth in the H2 of the year. We also expect continued momentum in our shower systems business as recently introduced products and customer programs continue to expand, providing additional opportunities for growth through the remainder of 2026. Although the external environment continues to evolve, including ongoing trade and tariff developments, I am proud of how our team has remained focused on execution. Their ability to adapt to changing market conditions while continuing to serve our customers has positioned FGI well for the remainder of the year. With that, I'll turn the call over to Jae for a more detailed review of our financial results.
Speaker #3: Looking ahead, we expect covered bridge cabinetry to resume growth in the second half of the year. We also expect continued momentum in our shower systems business as recently introduced products and customer programs continue to expand, providing additional opportunities for growth through the remainder of 2026.
Speaker #3: Although the external environment continues to evolve, including ongoing trade and tariff developments, I am proud of how our team has remained focused on execution.
Speaker #3: Their ability to adapt to changing market conditions while continuing to serve our customers has positioned FGI well for the remainder of the year. With that, I'll turn the call over to Jay for a more detailed review of our financial results.
Speaker #2: Thank you, Dave, and good morning, everyone. I will begin by providing additional details on the quarter, followed by an update on our current liquidity and balance sheet.
Jae Chung: Thank you, Dave, and good morning, everyone. I will begin by providing additional details on the quarter, followed by an update on our current liquidity and balance sheet. For the Q2 2026, revenue totaled $31.9 million, an increase of 2.9% compared to the Q2 2025. Gross profit was $10.7 million in the quarter, an increase of 22.5% year over year. Our gross margin increased to 33.4% in the quarter, compared to 28.1% the prior year, driven by trade related recoveries in the quarter. Our operating expenses decreased to $9.3 million compared to $9.5 million in the prior year, due primarily to lower selling and distribution costs and optimizing our warehouse operations. These efforts are part of our broader initiative to diversify our supply chain and reduce freight costs. We expect to begin operations at a new warehouse in Texas to support distribution across the Southern United States.
Jae Chung: Thank you, Dave, and good morning, everyone. I will begin by providing additional details on the quarter, followed by an update on our current liquidity and balance sheet. For the Q2 2026, revenue totaled $31.9 million, an increase of 2.9% compared to the Q2 2025. Gross profit was $10.7 million in the quarter, an increase of 22.5% year over year. Our gross margin increased to 33.4% in the quarter, compared to 28.1% the prior year, driven by trade related recoveries in the quarter. Our operating expenses decreased to $9.3 million compared to $9.5 million in the prior year, due primarily to lower selling and distribution costs and optimizing our warehouse operations. These efforts are part of our broader initiative to diversify our supply chain and reduce freight costs. We expect to begin operations at a new warehouse in Texas to support distribution across the Southern United States.
Speaker #2: For the second quarter 2026, revenue totaled $31.9 million and increased 2.9% compared to the second quarter of 2025. Gross profit was $10.7 million in the quarter and increased 22.5% year over year.
Speaker #2: Our gross margin increased to 33.4% in the quarter, compared to 28.1% in the prior year, driven by trade-related recoveries in the quarter. Our operating expenses decreased to $9.3 million, compared to $9.5 million in the prior year, due primarily to lower selling and distribution costs and optimizing our warehouse operations.
Speaker #2: These efforts are part of our broader initiative to diversify our supply chain and reduce freight costs. We expect to begin operations at a new warehouse in Texas to support distribution across the southern United States.
Speaker #2: GAAP operating gain was $1.4 million, improving from an operating loss of $0.8 million in the prior year period. The improvement in the operating loss was a result of trade-related recoveries, which were reflected in the cost of goods sold, and a decrease in total operating expenses.
Jae Chung: GAAP operating gain was $1.4 million, improving from an operating loss of $0.8 million in the prior year period. The improvement in the operating loss was a result of trade related recoveries which were reflected in the cost of goods sold and a decrease in total operating expenses. GAAP net income attributable to shareholders was $1.3 million, compared to a loss of $1.2 million in the same period last year. Adjusted net income was $1.2 million, compared to a loss of $1.2 million in the same period last year. Moving to our balance sheet, at the end of the Q2, FGI had $7.9 million in total liquidity. Our 2026 guidance remains unchanged and does not include trade related recoveries. Our revenue guidance is $134 to $141 million. The adjusted operating income guidance is $0.7 million to $2.5 million.
Jae Chung: GAAP operating gain was $1.4 million, improving from an operating loss of $0.8 million in the prior year period. The improvement in the operating loss was a result of trade related recoveries which were reflected in the cost of goods sold and a decrease in total operating expenses. GAAP net income attributable to shareholders was $1.3 million, compared to a loss of $1.2 million in the same period last year. Adjusted net income was $1.2 million, compared to a loss of $1.2 million in the same period last year. Moving to our balance sheet, at the end of the Q2, FGI had $7.9 million in total liquidity. Our 2026 guidance remains unchanged and does not include trade related recoveries. Our revenue guidance is $134 to $141 million. The adjusted operating income guidance is $0.7 million to $2.5 million.
Speaker #2: GAAP net income attributable to shareholders was $1.3 million, compared to a loss of $1.2 million in the same period last year. Adjusted net income was $1.2 million, compared to a loss of $1.2 million in the same period last year.
Speaker #2: Moving to our balance sheet, at the end of the second quarter, FGI had 7.9 million in total liquidity. Our 2026 guidance remains unchanged and does not include trade-related recoveries.
Speaker #2: Our revenue guidance is 134 to 141 million dollars. The adjusted operating income guidance is 0.7 million to 2.5 million dollars. The adjusted net income guidance is a loss of 0.3 million to a gain of 1.1 million dollars.
Jae Chung: The adjusted net income guidance is a loss of $0.3 million to a gain of $1.1 million. Please note that the guidance for adjusted operating income excludes certain non-recurring items. Adjusted net income excludes certain non-recurring items and includes an adjustment for minority interest. That concludes our prepared remarks. Operator, we are now ready for the question and answer portion of our call.
Jae Chung: The adjusted net income guidance is a loss of $0.3 million to a gain of $1.1 million. Please note that the guidance for adjusted operating income excludes certain non-recurring items. Adjusted net income excludes certain non-recurring items and includes an adjustment for minority interest. That concludes our prepared remarks. Operator, we are now ready for the question and answer portion of our call.
Speaker #2: Please note that the guidance for adjusted operating income excludes certain non-recurring items. Adjusted net income excludes certain non-recurring items and includes an adjustment for minority interest.
Speaker #2: That concludes our prepared remarks. Operator, we are now ready for the question and answer portion of our call.
Speaker #4: We will now begin the question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys.
Operator: We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. The first question comes from Reuben Garner with The Benchmark Company. Please go ahead.
Operator: We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster. The first question comes from Reuben Garner with The Benchmark Company. Please go ahead.
Speaker #4: If at any time your question has been addressed and you would like to withdraw your question, please press star, then 2. At this time, we will pause momentarily to assemble our roster.
Speaker #4: The first question comes from Ruben Garner with the benchmark company. Please go ahead.
Speaker #2: Thank you. Good morning, guys.
Reuben Garner: Thank you. Good morning, guys.
Reuben Garner: Thank you. Good morning, guys.
Speaker #5: Hey, good morning, Ruben.
David Bruce: Hey, good morning, Reuben.
David Bruce: Hey, good morning, Reuben.
Speaker #2: Good morning, Ruben. You referenced tariffs a few times. I was wondering if you could offer some clarity on any refunds you may have received to date what might be on the come, and then I guess the net effect for you guys.
Jae Chung: Morning.
Jae Chung: Morning.
Reuben Garner: You referenced tariffs a few times. I was wondering if you could offer some clarity on any refunds you may have received to date, what might be on the come, and then I guess the net effect for you guys. I know there's been a little part year and a half, but just kind of where it's all shaking out today.
Reuben Garner: You referenced tariffs a few times. I was wondering if you could offer some clarity on any refunds you may have received to date, what might be on the come, and then I guess the net effect for you guys. I know there's been a little part year and a half, but just kind of where it's all shaking out today.
Speaker #2: I know there's been a little part year and a half, but just kind of where it's all shaken out today.
Speaker #6: Yeah. Hey, Ruben. We're in the process of finalizing our Q, and the specific information on the amount of the refund will be in the Q to be released tomorrow.
Jae Chung: Yeah. Hey, Reuben. We're in the process of finalizing our Q, and the specific information on the amount of the refund will be in the Q to be released tomorrow. As far as further recoveries specifically related to APA, we believe we've received all or the vast majority of it. You can see the actual numbers tomorrow.
Jae Chung: Yeah. Hey, Reuben. We're in the process of finalizing our Q, and the specific information on the amount of the refund will be in the Q to be released tomorrow. As far as further recoveries specifically related to APA, we believe we've received all or the vast majority of it. You can see the actual numbers tomorrow. Dave, do you want to comment?
Speaker #6: As far as further recoveries specifically related to AIPA, we believe we've received all or the vast majority of it. So you can see the actual numbers tomorrow.
Speaker #6: And Dave, do you want to comment?
Reuben Garner: Dave, do you want to comment?
Speaker #5: Yeah, I think that we view any of these recoveries as really it's just a partial offset to the impact that we had to absorb going all the way back to last year.
David Bruce: Yeah, I think that we view any of these recoveries as really just a partial offset to the impact that we had to absorb going all the way back to last year. We still continue to pay various trade-related expenses, not only tariffs, but also other duties and VAT tax drawbacks that some of our suppliers are impacted by. We expect, quite frankly, some additional tariff levies to be impacted at the beginning of next year. So it's an ongoing, I'll call it an ongoing saga with the tariffs. It's not something that we anticipate is going to go away, and we continue to support our customers as we have recently and in the past, right? So we're looking at the recoveries as a one-time thing here, but the impact of tariffs are going to continue.
David Bruce: Yeah, I think that we view any of these recoveries as really just a partial offset to the impact that we had to absorb going all the way back to last year. We still continue to pay various trade-related expenses, not only tariffs, but also other duties and VAT tax drawbacks that some of our suppliers are impacted by. We expect, quite frankly, some additional tariff levies to be impacted at the beginning of next year. So it's an ongoing, I'll call it an ongoing saga with the tariffs. It's not something that we anticipate is going to go away, and we continue to support our customers as we have recently and in the past, right? So we're looking at the recoveries as a one-time thing here, but the impact of tariffs are going to continue.
Speaker #5: And we still continue to pay various trade-related expenses, not only tariffs, but also other duties and VAT tax drawbacks that some of our suppliers are impacted by.
Speaker #5: And we expect quite frankly, some additional tariff levies to be impacted at the beginning of next year. So this is not a it's an ongoing I'll call it an ongoing saga with the tariffs.
Speaker #5: It's not something that we anticipate's going to go away. And we continue to support our customers as we have recently and in the past, right?
Speaker #5: So we're looking at the recoveries as a one-time thing here, but the impact of tariffs are going to continue.
Speaker #6: How about at your customer? What have you seen in terms of discounting relative to, I don't know, normal discounting this time of year? Has that been increased at all with the changes in the tariffs, or inventory levels, or anything else at the retail level?
Reuben Garner: How about at your customer? What have you seen in terms of discounting relative to, I don't know, normal discounting this time of year? Has that been increased at all with the changes in the tariffs or inventory levels or anything else at the retail level?
Reuben Garner: How about at your customer? What have you seen in terms of discounting relative to, I don't know, normal discounting this time of year? Has that been increased at all with the changes in the tariffs or inventory levels or anything else at the retail level?
Speaker #5: Yeah, I think discounting I would call it more a promotional opportunities. We've taken I shouldn't say taken, but we've worked closely with some of our customers on promotional opportunities.
David Bruce: Yeah, I think discounting, I would call it more promotional opportunities. We've taken, I shouldn't say taken, but we've worked closely with some of our customers on promotional opportunities. We drove some larger promotions with our sanitaryware in the quarter. The market overall, as we've discussed before, continues to be relatively flat in the R&R space. Promoting products is becoming a viable way for us to drive continued growth and market share. I think that's what we see more than anything is opportunities to reach out to our customers and offer some discounting to try to drive incremental business.
David Bruce: Yeah, I think discounting, I would call it more promotional opportunities. We've taken, I shouldn't say taken, but we've worked closely with some of our customers on promotional opportunities. We drove some larger promotions with our sanitaryware in the quarter. The market overall, as we've discussed before, continues to be relatively flat in the R&R space. Promoting products is becoming a viable way for us to drive continued growth and market share. I think that's what we see more than anything is opportunities to reach out to our customers and offer some discounting to try to drive incremental business.
Speaker #5: We drove some larger promotions with our sanitary wear in the quarter. The market overall, as we've discussed before, continues to be relatively flat in the R&R space.
Speaker #5: Promoting products is becoming a viable way for us to drive continued growth and market share. And I think that's what we see more than anything is opportunities to reach out to our customers and offer some discounting to try to drive incremental business.
Speaker #6: Okay. And then last one for me, your the products that you guys the branded sort of FGI branded products that you've been trying to grow the last couple of years, what's kind of next on that front?
Reuben Garner: Okay, and then last one for me. The products that you guys, the FGI-branded products that you've been trying to grow the last couple of years, what's next on that front? Any big opportunities on the come in terms of expanding those kind of higher margin businesses for you?
Reuben Garner: Okay, and then last one for me. The products that you guys, the FGI-branded products that you've been trying to grow the last couple of years, what's next on that front? Any big opportunities on the come in terms of expanding those kind of higher margin businesses for you?
Speaker #6: Are there any major opportunities coming up in terms of expanding those higher-margin businesses for you?
Speaker #5: Yeah, I think that's a great question. We're really we've become really successful and continue to be successful with our branded products and our particularly in our shower systems business.
David Bruce: Yeah, I think that's a great question. We've become really successful and continue to be successful with our branded products, particularly in our shower systems business. That would be across our doors, bases, and walls. I think in the call we mentioned, it was just a quick blurb, but we mentioned our new distribution center that we are going to open by the end of this year in Houston. We're entering that quite shortly. That is going to be another avenue for us to expand territories on our wholesale business with our contract brand. So we're very excited about that. We've been working on that for a long time. So yeah, our BPC strategy, despite the fact that we also obviously are large supporters of our larger customers' proprietary and private label, we continue to expand our own brand presence strategically throughout the market.
David Bruce: Yeah, I think that's a great question. We've become really successful and continue to be successful with our branded products, particularly in our shower systems business. That would be across our doors, bases, and walls. I think in the call we mentioned, it was just a quick blurb, but we mentioned our new distribution center that we are going to open by the end of this year in Houston. We're entering that quite shortly. That is going to be another avenue for us to expand territories on our wholesale business with our contract brand. So we're very excited about that. We've been working on that for a long time. So yeah, our BPC strategy, despite the fact that we also obviously are large supporters of our larger customers' proprietary and private label, we continue to expand our own brand presence strategically throughout the market.
Speaker #5: That would be across our doors, bases, and walls. And I think in the call—we mentioned it, it was just a quick blurb—but we mentioned our new distribution center that we are going to open by the end of this year in Houston.
Speaker #5: We're entering that quite shortly. That is going to be another avenue for us to expand territories on our wholesale business with our contract brand.
Speaker #5: So we're very excited about that. We've been working on that for a long time. So yeah, that our BPC strategy despite the fact that we also obviously are a large supporters of our larger customers' proprietary and private label, we continue to expand our own brand presence strategically throughout the market.
Speaker #6: All right. Thanks for the detail, guys. And good luck.
Reuben Garner: Thanks for the details, guys, and good luck.
Reuben Garner: Thanks for the details, guys, and good luck.
Speaker #5: Great. Thanks.
David Bruce: Great. Thanks.
David Bruce: Great. Thanks.
Speaker #4: The next question comes from Greg Gibbis with Northland Securities. Please go ahead.
Operator: The next question comes from Greg Gibbes with Northland Securities. Please go ahead.
Operator: The next question comes from Greg Gibbes with Northland Securities. Please go ahead.
Speaker #7: Hey, thanks. Good morning, Dave, Jay. I wanted to maybe just ask more basically about your visibility on that cap growth, given you reaffirmed guidance, and what kind of gives you confidence in how the back half will trend.
Greg Gibbes: Hey, thanks. Good morning, Dave, Jay. I wanted to maybe just ask more basically on just kind of your visibility on H2 growth, given you reaffirmed by guidance and what kind of gives you confidence in how the H2 will trend, whether it's kind of your discussions with customers or just overall demand you're seeing in the market, if anything's changed maybe since your last provided guidance.
Greg Gibas: Hey, thanks. Good morning, Dave, Jay. I wanted to maybe just ask more basically on just kind of your visibility on H2 growth, given you reaffirmed by guidance and what kind of gives you confidence in how the H2 will trend, whether it's kind of your discussions with customers or just overall demand you're seeing in the market, if anything's changed maybe since your last provided guidance.
Speaker #7: Whether it's in your discussions with customers or just overall demand you're seeing in the market, if anything's changed, maybe since your last provided guidance.
Speaker #7: Thanks.
Speaker #5: Yeah, I think things have held where we had expected. The market, like I mentioned, just on the previous call, it's relatively soft. There's still a cautionary tone in the market when it comes to building up inventory order placements have been relatively consistent and cadence on shipping.
David Bruce: Yeah, I think things have held where we had expected. The market, like I mentioned just on the previous call, it's relatively soft. There's still a cautionary tone in the market when it comes to building up inventory. Order placements have been relatively consistent and cadence on shipping. We didn't change guidance. I would venture to say that we're probably based on the softer market, looking at maybe more lower ends on the guidance levels. We're also optimistic because we still are implementing some new programs to customers that will launch. Some of those were delayed just due to various market issues, not anything in particular to do with the sales. We would anticipate, we've taken all that into account to understand would we have wanted to change the guide? We want to keep the guide where it's at.
David Bruce: Yeah, I think things have held where we had expected. The market, like I mentioned just on the previous call, it's relatively soft. There's still a cautionary tone in the market when it comes to building up inventory. Order placements have been relatively consistent and cadence on shipping. We didn't change guidance. I would venture to say that we're probably based on the softer market, looking at maybe more lower ends on the guidance levels. We're also optimistic because we still are implementing some new programs to customers that will launch. Some of those were delayed just due to various market issues, not anything in particular to do with the sales. We would anticipate, we've taken all that into account to understand would we have wanted to change the guide? We want to keep the guide where it's at.
Speaker #5: But we didn't change guidance. I would venture to say that we're probably based on the softer market looking at maybe a more lower end on the guidance levels.
Speaker #5: But we're also optimistic because we still are implementing some of our some new programs that customers that will launch some of those were delayed just due to various market issues.
Speaker #5: Not anything in particular to do with the sales, but we would anticipate we've taken all that into account to understand would we have wanted to change the guide.
Speaker #5: And we want to keep the guide where it's at, but we would probably venture to say we're going to look towards more the lower side, just based on the cautionary tone right now in the marketplace and some of the pressures that exist.
David Bruce: We would probably venture to say we're going to look towards more the lower side, just based on the cautionary tone right now in the marketplace and some of the pressures that exist.
David Bruce: We would probably venture to say we're going to look towards more the lower side, just based on the cautionary tone right now in the marketplace and some of the pressures that exist.
Speaker #7: Great. That's helpful. And then maybe similarly, just if you could discuss kind of puts and takes of kind of the demand across your channels geographically, but also kind of customer type.
Greg Gibbes: Great. That is helpful. Then maybe similarly, just if you could discuss kind of puts and takes of the demand across your channels geographically, but also kind of customer type.
Greg Gibas: Great. That is helpful. Then maybe similarly, just if you could discuss kind of puts and takes of the demand across your channels geographically, but also kind of customer type.
Speaker #5: Sure. Yeah, we've had a little more pressure in our Canadian sales. That's been the most pressured this year. Initially in the first part of the year, it was across both of our wholesale and retail.
David Bruce: Sure. Yeah, we have had a little more pressure in our Canadian sales. That has been the most pressured this year. Initially, in the first part of the year, it was across both of our wholesale and retail. Wholesale is recovering slowly. Retail has been a little bit of a struggle. There has been a lot of competitive and pricing pressures up in the market, which we are addressing. Then in the US, it has been more of, like I said, sort of a cautionary flat market other than where we are taking share on incremental gains on new programs. Then on our European business, very similar. They have been pretty strong and consistent. Order cadence has been good. We have been expanding into our wholesale trade in the European market. But there has not been any outlying bigger wins outside of with the market pressure over there, obviously, that still exists.
David Bruce: Sure. Yeah, we have had a little more pressure in our Canadian sales. That has been the most pressured this year. Initially, in the first part of the year, it was across both of our wholesale and retail. Wholesale is recovering slowly. Retail has been a little bit of a struggle. There has been a lot of competitive and pricing pressures up in the market, which we are addressing. Then in the US, it has been more of, like I said, sort of a cautionary flat market other than where we are taking share on incremental gains on new programs. Then on our European business, very similar. They have been pretty strong and consistent. Order cadence has been good.
Speaker #5: Wholesales recovering slowly. Retail's been a little bit of a struggle. There's been a lot of competitive and pricing pressures up in the market, which we're addressing.
Speaker #5: And then, in the US, it’s been more of, like I said, sort of a cautionary, flat market, other than where we’re taking share on incremental gains on new programs.
Speaker #5: And then on our European business, it's very similar. They've been pretty strong and consistent. Order cadence has been good. We've been expanding into our wholesale trade in the European market.
David Bruce: We have been expanding into our wholesale trade in the European market. But there has not been any outlying bigger wins outside of with the market pressure over there, obviously, that still exists. But we have been very proud of actually the progress we have been able to make and particularly taking share on that wholesale side, which has been very important over in Europe.
Speaker #5: But there hasn't been any outlying bigger wins outside of with the market pressure over there, obviously, that still exists. But we've been very proud of actually the progress we've been able to make in taking particularly taking share on that wholesale side, which has been very important over in Europe.
David Bruce: But we have been very proud of actually the progress we have been able to make and particularly taking share on that wholesale side, which has been very important over in Europe.
Speaker #7: Okay. Got it. Appreciate the color there.
Greg Gibbes: Okay. Got it. Appreciate the color there.
Greg Gibas: Okay. Got it. Appreciate the color there.
Speaker #4: This concludes our question and answer session. I would like to turn the conference back over to David Bruce for any closing remarks.
Operator: This concludes our question and answer session. I would like to turn the conference back over to David Bruce for any closing remarks.
Operator: This concludes our question and answer session. I would like to turn the conference back over to David Bruce for any closing remarks.
Speaker #5: Thank you for your time and interest today. We really appreciate your continued support of FGI. Stay well, and if we don't connect during the quarter, we look forward to speaking with you on our next call.
David Bruce: Thank you for your time and interest today. We really appreciate your continued support of FGI. Stay well, and if we don't connect during the quarter, we look forward to speaking with you on our next call.
David Bruce: Thank you for your time and interest today. We really appreciate your continued support of FGI. Stay well, and if we don't connect during the quarter, we look forward to speaking with you on our next call.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
Operator: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
