Earnings

GPGI Restores Sequential Sales and EBITDA After First-Quarter Drop

The Tip Desk · August 6, 2026 · 3 min read

Pro forma adjusted net sales were $473.2 million and adjusted EBITDA $113.9 million, inside the May outlook, as the company kept its full-year 2026 ranges.

GPGI, Inc. (GPGI), a diversified multi-industry platform, reported second-quarter 2026 pro forma adjusted net sales of $473.2 million, down 4% from a year earlier, after first-quarter sales had been up 3% year over year.

Sequentially, sales rose from $421.2 million in the first quarter. Pro forma adjusted EBITDA was $113.9 million, down 13% from the year-ago period, with a pro forma adjusted EBITDA margin of 24.1%, down 230 basis points.

The company said results were consistent with expectations and with the revised guidance range introduced in the first quarter. Executive Chairman Dave Cote said GPGI continued to see record strength at CompoSecure and was effectively navigating transient market headwinds at Husky, and that the company is well positioned to deliver in the second half of 2026 and for an acceleration in 2027. Chief Investment Officer Tom Knott said the long-term strategy remains on track and that both businesses are being made better as teams embrace the Resolute Operating System.

Actual second-quarter figures fell inside the May outlook of adjusted net sales of $425 million to $475 million and adjusted EBITDA of $105 million to $120 million.

GAAP net income was $50.3 million. On a non-GAAP consolidated basis, net sales were $473.2 million, cost of sales was $308.2 million, and gross profit was $165.0 million. Selling, general, and administrative expenses were $148.4 million. Other income included a $96.2 million gain on extinguishment of debt, offset by $33.1 million of interest expense. Reconciling items added back to arrive at pro forma adjusted EBITDA included a $23.6 million fair-value inventory step-up, $64.3 million of depreciation and amortization, $6.1 million of stock-based compensation, $3.6 million of severance, and $1.3 million of Husky transaction costs.

Cash and short-term investments were $114.8 million on a non-GAAP basis, including $107.1 million held at GPGI Holdings and not included in GAAP results. Total debt was $2,115.0 million on a pro forma basis.

The company reiterated its full-year 2026 outlook: pro forma adjusted net sales of $1,950 million to $2,100 million, flat year over year at the midpoint; pro forma adjusted EBITDA of $550 million to $610 million, up 7% at the midpoint; pro forma adjusted free cash flow of $275 million to $325 million; and a target of non-GAAP year-end net LTM leverage of approximately 3.0 times. Those ranges were already lower than the March outlook of $2,183 million to $2,228 million in sales, $620 million to $650 million in EBITDA, and $325 million to $375 million in free cash flow, with leverage then targeted at less than 3.0 times.

In the first quarter, the company cited unexpected market headwinds at Husky from an oil and resin price shock and continued tariff uncertainty, and said it was taking necessary cost actions. Cote’s second-quarter comment that Husky headwinds were transient and that CompoSecure remained at record strength framed the quarter as a return toward the May ranges rather than a further break.

GPGI currently consists of CompoSecure, a leader in metal payment cards, security, and authentication solutions, and Husky, a maker of injection molding machines, molds, hot runners, controllers, and auxiliaries used to produce plastic products. After the February 2025 spin-off of Resolute Holdings Management, the company accounts for GPGI Holdings under the equity method for GAAP results and presents adjusted and pro forma measures that consolidate the operating businesses and, for pro forma figures, give effect to the Husky combination as if it had occurred on January 1, 2025.

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