Q.E.P. CO., INC. REPORTS FISCAL 2026 FIRST QUARTER FINANCIAL RESULTS ANDDECLARES SECOND QUARTER CASH DIVIDEND
BOCA RATON, FLORIDA — July 15, 2025 — Q.E.P. CO., INC. (OTCQX: QEPC) (the “Company” or “QEP”) today announced its financial results for the first quarter ended May 31, 2025 and declared its second quarter cash dividend.
Results of Operations
Net sales for the quarter ended May 31, 2025 were $61.5 million, down $2.0 million or 3.1% from $63.5 million reported for the first quarter of fiscal 2025. The slight decline in net sales was primarily due to the ongoing softness in home improvement spending due to elevated interest rates and macroeconomic uncertainty.
Gross profit for the first quarter of fiscal 2026 increased $0.2 million or 0.1% to $22.7 million, up from $22.5 million for the same period in the prior year. As a percentage of net sales, gross margin improved to 36.9% in the first quarter of fiscal 2026, up from 35.4% in the first quarter of fiscal 2025, primarily due to the sell-through of inventory purchased before recent tariff increases. This improvement may be temporary, as future gross margins are expected to be impacted by higher landed costs resulting from newly imposed tariffs.
“Despite persistent economic headwinds, the first quarter results demonstrate the strength and resiliency of our business,” said Len Gould, President and Chief Executive Officer. “This is a reflection of the hard work of our people throughout QEP, and their efforts are to be applauded.”
Gould continued, “We continue to proactively expand and enhance our domestic manufacturing footprint and our sourcing capabilities. Earlier this week the Grand Opening of our latest adhesive production facility in Dalton, Georgia was held. This completed a multi-year effort to bring new technology and enhanced capacity to our lineup, along with the ability to ‘in-house’ formerly purchased items, which represents a major milestone for the Company, and a true win for our customers.”
Operating expenses totaled $16.9 million or 27.4% of net sales versus $17.3 million or 27.2% of net sales in the prior year period, reflecting lower variable expenses tied to sales volumes.
Interest income from the Company’s invested cash balances was $0.2 million, unchanged from the prior year.
The provision for income taxes as a percentage of income before taxes was 26% compared to 28% in the first quarter of fiscal 2025.
Net income was $4.4 million or $1.36 per diluted share, as compared to $4.5 million or $1.34 per diluted share for the prior year period. Excluding discontinued operations, adjusted net income for the first quarter of the prior year was $3.9 million or $1.17 per diluted share.