BOA & Primaloft Parent Compass Diversified Reports First Quarter 2026 Financial Results
07/May/2026
Compass Diversified (NYSE: CODI) (“CODI” or the “Company”), an owner of leading middle-market businesses, announced today its consolidated operating results for the three months ended March 31, 2026.
"The first quarter of 2026 was a quarter of execution, with strong subsidiary performance led by our Consumer vertical, and a meaningful divestiture at an attractive valuation," said Elias Sabo, Chief Executive Officer of Compass Diversified. "We are delivering against the priorities we laid out for shareholders at the beginning of the year."
Sabo continued, "A single quarter does not make a turnaround. Trust is earned through consistent execution, and that is what we expect to deliver for shareholders going forward."
On November 16, 2025, CODI deconsolidated Lugano Holding, Inc. ("Lugano"). Accordingly, CODI’s GAAP results for the three months ended March 31, 2026 do not include Lugano’s operating results. Certain non-GAAP results and their associated growth rates are presented excluding Lugano’s 2025 results to facilitate comparisons of year-over-year performance for our remaining subsidiaries.
Despite a 5.9 percent dip in overall GAAP revenue to $426.9 million, CODI managed to lean into efficiency, posting a robust 24.2 percent increase in total adjusted EBITDA, which climbed to $56.5 million from $45.5 million in the prior year.
The Top Performers: BOA and Velocity Outdoor
The star of the quarter was undoubtedly BOA. The brand, known for its performance fit solutions, saw sales grow 6.7 percent to $52.1 million. The bottom line was even more impressive, with non-GAAP adjusted EBITDA jumping 10.7 percent to $22 million, signaling strong operational margins and continued demand in the technical footwear and gear sectors.
Velocity Outdoor—the parent company of Ravin crossbows, CenterPoint archery, and King’s Camo—showed signs of a successful turnaround. The segment reported:
Sales: $13.8 million (up 4.7% from $13.2 million).
Profitability: A positive adjusted EBITDA of $273,000, a significant swing from the $1.4 million loss recorded in the same period last year.
The Challenges: 5.11 and PrimaLoft
The quarter was less kind to CODI’s larger lifestyle and technical apparel brands. 5.11, usually a reliable engine for the company, saw revenues dip 4.2 percent to $123.8 million. Adjusted EBITDA for the brand remained relatively resilient but still slipped 1.7 percent to $14.6 million.
PrimaLoft faced steeper declines as the textile and insulation market adjusted. Sales fell 7.3 percent to $21.9 million, while adjusted EBITDA took a 14.8 percent hit, landing at $8.5 million compared to $9.9 million a year ago.
Portfolio Snapshot: Gains and Gaps
Beyond the headline brands, CODI’s diverse portfolio showed varying degrees of momentum:
Subsidiary | Performance Trend |
The Honey Pot Co. | Reported healthy gains, continuing its upward trajectory. |
Arnold Magnetic Technologies | Remained flat, providing a steady baseline. |
Lugano Diamonds | Experienced a revenue decline during the quarter. |
Altor Solutions | Also saw a dip in sales performance. |
While the revenue contraction at 5.11 and PrimaLoft weighed on the top line, the significant jump in total adjusted EBITDA suggests that CODI’s management is successfully optimizing costs and benefiting from high-margin growth in specific pockets of the portfolio.
As the 2026 fiscal year progresses, investors will likely keep a sharp eye on whether BOA can maintain its pace and if 5.11 can find its footing in a shifting retail environment.
Financial Summary – (GAAP)
Q1 2026 (GAAP)
Net revenues were $426.9 million, down 5.9% vs Q1 2025
Net loss from continuing operations was $30.8 million vs $49.8 million in Q1 2025
Financial Summary – (non-GAAP)
Q1 2026 (non-GAAP – Excluding Lugano in the prior year period)
Net revenues were $426.9 million, flat to Q1 2025
Branded Consumer: $257.0 million, up 2.3% vs Q1 2025
Industrial: $169.9 million, down 3.3% vs Q1 2025
Subsidiary Adjusted EBITDA was $83.9 million, up 6.3% vs Q1 2025
Branded Consumer: $59.4 million, up 11.6% vs Q1 2025
Industrial: $24.4 million, down 4.5% vs Q1 2025
Recent Business Updates
Completed the sale of Sterno’s food service business for an enterprise value of $292.5 million, with net proceeds used to repay outstanding debt.
The Sterno transaction generated proceeds to CODI of approximately $280 million, reducing senior secured indebtedness below 1.0x, sufficient to avoid second quarter milestone fees associated with excess leverage under the Company’s senior secured credit arrangements, as of June 30, 2026.
Liquidity and Capital Resources
As of March 31, 2026, CODI had approximately $65.2 million in cash and cash equivalents and approximately $100 million in revolver availability.
2026 Outlook
The Company is updating its fiscal 2026 financial guidance to reflect the sale of Sterno's food service business. The updated guidance is at or above the expectations set at the start of the year, adjusting for the divested business.
2026 Outlook
Subsidiary Adjusted EBITDA Low High (millions)
Branded Consumer $ 225.0 - $ 260.0
Industrial $ 95.0 - $ 105.0
Subsidiary Adjusted EBITDA $ 320.0 -$ 365.0
In reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K, CODI has not reconciled 2026 Subsidiary Adjusted EBITDA to its comparable GAAP measure because it does not provide guidance on Income (Loss) from Continuing Operations and because management cannot predict, with sufficient certainty, all of the inputs necessary to provide such a reconciliation. For the same reasons, CODI is unable to address the probable significance of the unavailable information, which could be material to future results.
