Compass Diversified Reports Second Quarter 2025 Financial Results

WESTPORT, Conn., Dec. 29, 2025 (GLOBE NEWSWIRE) — 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 June 30, 2025 and filed its Quarterly Report on Form 10-Q for the period. The Company expects to file its Quarterly Report on Form 10-Q for the third quarter of 2025 in the coming weeks.

“We continue to make meaningful progress toward bringing our financial reporting up to date,” said Elias Sabo, Chief Executive Officer of Compass Diversified. “While this work is ongoing, our priorities remain unchanged: delivering strong operating performance across our eight subsidiaries and maintaining a disciplined approach to capital allocation as we focus on generating long-term value for our shareholders.”

2025 Outlook (Reiterated)

CODI reiterates its expectation for full-year 2025 subsidiary Adjusted EBITDA of $330 million to $360 million, excluding Lugano Holding, Inc.

Note Regarding Use of Non-GAAP Financial Measures

Adjusted EBITDA and Adjusted Earnings (Loss) are non-GAAP measures used by the Company to assess its performance. We have reconciled Adjusted EBITDA to Income (Loss) from Continuing Operations and Adjusted Earnings (Loss) to Net Income (Loss) on the attached schedules. We consider Income (Loss) from Continuing Operations to be the most directly comparable GAAP financial measure to Adjusted EBITDA and Net Income (Loss) to be the most directly comparable GAAP financial measure to Adjusted Earnings (Loss). We believe that Adjusted EBITDA and Adjusted Earnings (Loss) provides useful information to investors and reflect important financial measures as each excludes the effects of items which reflect the impact of long-term investment decisions, rather than the performance of near-term operations. When compared to Net Income (Loss) and Income (Loss) from Continuing Operations, Adjusted Earnings (Loss) and Adjusted EBITDA, respectively, are each limited in that they do not reflect the periodic costs of certain capital assets used in generating revenues of our businesses or the non-cash charges associated with impairments, as well as certain cash charges. The presentation of Adjusted EBITDA allows investors to view the performance of our businesses in a manner similar to the methods used by us and the management of our businesses, provides additional insight into our operating results and provides a measure for evaluating targeted businesses for acquisition. The presentation of Adjusted Earnings (Loss) provides insight into our operating results.

Pro forma net sales is defined as net sales including the historical net sales relating to the pre-acquisition periods of The Honey Pot Co., assuming that the Company acquired The Honey Pot Co. on January 1, 2024. We have reconciled pro forma net sales to net sales, the most directly comparable GAAP financial measure, on the attached schedules. We believe that pro forma net sales is useful information for investors as it provides a better understanding of sales performance, and relative changes thereto, on a comparable basis. Pro forma net sales is not necessarily indicative of what the actual results would have been if the acquisition had in fact occurred on the date or for the periods indicated nor does it purport to project net sales for any future periods or as of any date.

In reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K, we have not reconciled 2025 Subsidiary Adjusted EBITDA to its comparable GAAP measure because we do not provide guidance on Net Income (Loss) from Continuing Operations or the applicable reconciling items as a result of the uncertainty regarding, and the potential variability of, these items. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results.

Adjusted EBITDA, Adjusted Earnings and pro forma net sales are not meant to be a substitute for GAAP measures and may be different from or otherwise inconsistent with non-GAAP financial measures used by other companies.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including without limitation, CODI’s expectations with respect to the timing of its delinquent financial statements, CODI’s expectations regarding its future performance, liquidity and leverage, the future performance of CODI’s subsidiaries, and the filing or delay of CODI’s periodic reports. Such forward-looking statements may be identified by, among other things, the use of forward-looking terminology such as “believe,” “expect,” “may,” “could,” “would,” “plan,” “intend,” “estimate,” “predict,” “future,” “potential,” “continue,” “should” or “anticipate” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. These statements are based on beliefs and assumptions by CODI’s Board of Directors and management, and on information currently available to CODI’s Board of Directors and management. These statements involve risk and uncertainties that could cause actual results and outcomes to differ, perhaps materially, including but not limited to: changes in the economy, financial markets and political environment, including changes in inflation, interest rates and U.S. tariff and import/export regulations; risks associated with possible disruption in CODI’s operations or the economy generally due to terrorism, war, natural disasters, or social, civil or political unrest; future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities); environmental risks affecting the business or operations of our subsidiaries; disruption in the global supply chain, labor shortages and labor costs; our business prospects and the prospects of our subsidiaries; the impact of, and ability to successfully complete and integrate, acquisitions that we have made or may make; the ability to successfully complete when we’ve executed divestitures agreements; the dependence of our future success on the general economy and its impact on the industries in which we operate; the ability of our subsidiaries to achieve their objectives; the adequacy of our cash resources and working capital; the timing of cash flows, if any, from the operations of our subsidiaries; CODI’s ability to regain compliance with NYSE continued listing requirements; the cooperation of, and future concessions granted by, CODI’s lenders; control deficiencies identified or that may be identified in the future that will result in material weaknesses in CODI’s internal control over financial reporting; and litigation relating to the Lugano Holding, Inc. (“Lugano”) investigation, including CODI’s representations regarding its financial statements, and current and future litigation, enforcement actions or investigations relating to CODI’s internal controls, restatement reviews,
the Lugano investigation or related matters. Please see CODI’s Amendment No. 1 to Annual Report on Form 10-K/A for the year ended December 31, 2024 filed with the SEC on December 8, 2025 for other risk factors that you should consider in connection with such forward-looking statements. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date such statements have been made. Except as required by law, CODI does not undertake any public obligation to update any forward-looking statements to reflect events, circumstances, or new information after the date of this press release, or to reflect the occurrence of unanticipated events.

Investor Relations

Compass Diversified
[email protected]

Compass Diversified Holdings Condensed Consolidated Balance Sheets

	June 30, 2025			December 31, 2024
(in thousands)	(Unaudited)			(As Restated)
Assets
Current assets
Cash and cash equivalents	$	73,757		$	59,659
Accounts receivable, net		216,378			207,172
Inventories, net		605,480			571,248
Prepaid expenses and other current assets		134,004			126,692
Total current assets		1,029,619			964,771
Property, plant and equipment, net		216,587			244,746
Goodwill		895,420			895,916
Intangible assets, net		938,685			983,396
Other non-current assets		194,279			208,593
Total assets	$	3,274,590		$	3,297,422

Liabilities and stockholders’ equity
Current liabilities
Accounts payable and accrued expenses	$	428,640		$	421,715
Due to related party		18,204			18,036
Current portion, long-term debt		30,000			1,774,290
Subsidiary financing arrangements		183,959			169,765
Other current liabilities		51,144			49,617
Total current liabilities		711,947			2,433,423
Deferred income taxes		111,840			108,091
Long-term debt		1,827,036			—
Other non-current liabilities		213,037			225,334
Total liabilities		2,863,860			2,766,848
Stockholders’ equity
Total stockholders’ equity attributable to Holdings		601,880			678,620
Noncontrolling interest		(191,150	)		(148,046	)
Total stockholders’ equity		410,730			530,574
Total liabilities and stockholders’ equity	$	3,274,590		$	3,297,422

Compass Diversified Holdings Consolidated Statements of Operations (Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
		2025			2024			2025			2024
(in thousands, except per share data)				(As Restated)						(As Restated)
Net sales	$	478,690		$	426,705		$	932,465		$	837,531
Cost of sales		270,149			238,520			527,892			474,394
Gross profit		208,541			188,185			404,573			363,137
Operating expenses:
Selling, general and administrative expense		162,112			137,581			312,489			275,305
Management fees		19,035			18,739			37,898			36,681
Amortization expense		23,117			24,385			46,468			47,596
Impairment expense		31,515			—			31,515			8,182
Operating income (loss)		(27,238	)		7,480			(23,797	)		(4,627	)
Other income (expense):
Interest expense, net		(34,096	)		(29,596	)		(69,947	)		(54,863	)
Amortization of debt issuance costs		(971	)		(1,004	)		(2,096	)		(2,009	)
Loss on debt modification		(2,827	)		—			(2,827	)
Gain (loss) on sale of Crosman		—			(24,606	)		—			(24,606	)
Other income (expense), net		1,713			(40,642	)		(11,968	)		(88,084	)
Net loss from continuing operations before income taxes		(63,419	)		(88,368	)		(110,635	)		(174,189	)
Provision for income taxes		17,358			15,593			19,896			18,703
Loss from continuing operations		(80,777	)		(103,961	)		(130,531	)		(192,892	)
Income from discontinued operations, net of income tax		—			872			—			1,189
Gain on sale of discontinued operations		2,805			—			2,849			3,345
Net loss		(77,972	)		(103,089	)		(127,682	)		(188,358	)
Less: Net loss from continuing operations attributable to noncontrolling interest		(26,755	)		(29,802	)		(46,472	)		(58,558	)
Less: Net loss from discontinued operations attributable to noncontrolling interest		—			(235	)		—			(571	)
Net income (loss) attributable to Holdings	$	(51,217	)	$	(73,052	)	$	(81,210	)	$	(129,229	)

Amounts attributable to Holdings
Loss from continuing operations	$	(54,022	)	$	(74,159	)	$	(84,059	)	$	(134,334	)
Income from discontinued operations		—			1,107			—			1,760
Gain on sale of discontinued operations, net of income tax		2,805			—			2,849			3,345
Net loss attributable to Holdings	$	(51,217	)	$	(73,052	)	$	(81,210	)	$	(129,229	)

Basic income (loss) per common share attributable to Holdings
Continuing operations	$	(0.92	)	$	(1.13	)	$	(1.43	)	$	(2.66	)
Discontinued operations		0.04			0.01			0.04			0.07
	$	(0.88	)	$	(1.12	)	$	(1.39	)	$	(2.59	)

Basic weighted average number of common shares outstanding		75,236			75,389			75,236			75,332

Cash distributions declared per Trust common share	$	0.25		$	0.25		$	0.50		$	0.50

Compass Diversified Holdings Net Income (Loss) to Non-GAAP Adjusted Earnings and Non-GAAP Adjusted EBITDA (Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands, except per share amounts)		2025			2024			2025			2024
				(As Restated)						(As Restated)
Net loss	$	(77,972	)	$	(103,089	)	$	(127,682	)	$	(188,358	)
Income from discontinued operations, net of tax		—			872			—			1,189
Gain on sale of discontinued operations, net of tax		2,805			—			2,849			3,345
Net loss from continuing operations	$	(80,777	)	$	(103,961	)	$	(130,531	)	$	(192,892	)
Less: loss from continuing operations attributable to noncontrolling interest		(26,755	)		(29,802	)		(46,472	)		(58,558	)
Net income (loss) attributable to Holdings – continuing operations	$	(54,022	)	$	(74,159	)	$	(84,059	)	$	(134,334	)
Adjustments:
Distributions paid – preferred shares		(9,714	)		(6,101	)		(18,148	)		(12,146	)
Amortization expense – intangibles and inventory step up		23,117			25,406			46,468			51,285
Impairment expense		31,515			—			31,515			8,182
(Gain) loss on sale of Crosman		—			24,606			—			24,606
Tax effect – loss on sale of Crosman		—			7,254			—			7,254
Stock compensation		4,189			3,680			8,201			7,751
Acquisition expenses		—			—			—			3,479
Integration services fee		—			875			875			875
Other		3,881			130			5,427			402
Adjusted Earnings	$	(1,034	)	$	(18,309	)	$	(9,721	)	$	(42,646	)
Plus (less):
Depreciation expense		11,062			10,337			23,363			21,071
Income tax provision		17,358			15,593			19,896			18,703
Interest expense		34,096			29,596			69,947			54,863
Amortization of debt issuance costs		971			1,004			2,096			2,009
Loss on debt modification		2,827			—			2,827			—
Tax effect – loss on sale of Crosman					(7,254	)		—			(7,254	)
Income from continuing operations attributable to noncontrolling interest		(26,755	)		(29,802	)		(46,472	)		(58,558	)
Distributions paid – preferred shares		9,714			6,101			18,148			12,146
Other (income) expense		(1,714	)		40,642			11,968			88,084
Adjusted EBITDA	$	46,525		$	47,908		$	92,052		$	88,418

Compass Diversified Holdings Net Income (Loss) from Continuing Operations to Non-GAAP Consolidated Adjusted EBITDA Reconciliation Three Months Ended June 30, 2025 (Unaudited)

	Corporate				5.11		BOA			Lugano			PrimaLoft			THP			Velocity Outdoor			Altor		Arnold			Sterno			Consolidated
Income (loss) from continuing operations	$	(19,259	)	$	4,858		$	9,014		$	(68,808	)	$	261		$	835		$	(2,564	)	$	1,434	$	(13,335	)	$	6,787		$	(80,777	)
Adjusted for:
Provision (benefit) for income taxes		—			1,318			1,057			1			534			351			69			629		11,198			2,201			17,358
Interest expense, net		27,083			(3	)		(1	)		6,887			(6	)		(5	)		(12	)		—		153			—			34,096
Intercompany interest		(41,043	)		3,747			3,736			16,430			4,014			2,422			1,675			4,699		2,119			2,201			—
Depreciation and amortization		(106	)		5,531			5,248			1,475			5,339			4,159			1,368			5,923		2,703			3,510			35,150
EBITDA		(30,498	)		15,451			19,054			(44,015	)		10,142			7,762			536			12,685		2,838			14,699			8,654
Other (income) expense		(3	)		(242	)		42			(1,786	)		11			42			(83	)		375		23			(93	)		(1,714	)
Noncontrolling shareholder compensation		—			622			1,368			626			619			419			17			242		4			272			4,189
Impairment expense		—									31,515																				31,515
Other⁽¹⁾		—																					2,492		1,295			94			3,881
Adjusted EBITDA	$	(30,501	)	$	15,831		$	20,464		$	(13,660	)	$	10,772		$	8,223		$	470		$	15,794	$	4,160		$	14,972		$	46,525

⁽¹⁾ Other represents non-recurring operating expenses that are included by management in the calculation of Adjusted EBITDA when analyzing monthly operating results of our subsidiaries. In the current year, the calculation of Adjusted EBITDA for Arnold includes the add-back of certain expenses that have been incurred related to the relocation of two of Arnold’s facilities in the United States and severance costs related to chief executive officer at Arnold. For Altor, other includes the add-back of certain expenses incurred related to restructuring of their facilities after the acquisition of Lifoam.

Compass Diversified Holdings Net Income (Loss) from Continuing Operations to Non-GAAP Consolidated Adjusted EBITDA Reconciliation Three Months Ended June 30, 2024 (Unaudited)

	Corporate				5.11	BOA			Lugano			PrimaLoft			THP			Velocity Outdoor			Altor			Arnold			Sterno			Consolidated
									(As Restated)																					(As Restated)
Income (loss) from continuing operations	$	(9,340	)	$	5,457	$	8,995		$	(74,582	)	$	325		$	(4,114	)	$	(39,226	)	$	2,701		$	2,258		$	3,565		$	(103,961	)
Adjusted for:
Provision (benefit) for income taxes		—			1,807		1,929			387			664			(1,402	)		8,717			1,098			1,190			1,202			15,592
Interest expense, net		26,448			2		(9	)		3,035			(3	)		(3	)		10			—			116			—			29,596
Intercompany interest		(38,772	)		3,254		5,299			13,579			4,430			2,924			2,364			1,868			1,797			3,257			—
Depreciation and amortization		203			5,708		5,411			1,290			5,323			5,507			2,006			4,085			2,261			4,955			36,749
EBITDA		(21,461	)		16,228		21,625			(56,291	)		10,739			2,912			(26,129	)		9,752			7,622			12,979			(22,024	)
Other (income) expense		502			108		57			39,197			3			(13	)		26,195			(572	)		(61	)		(168	)		65,248
Noncontrolling shareholder compensation		—			552		1,419			699			315			472			176			252			5			(210	)		3,680
Integration services fee		—														875															875
Other		(2	)													—												131			129
Adjusted EBITDA	$	(20,961	)	$	16,888	$	23,101		$	(16,395	)	$	11,057		$	4,246		$	242		$	9,432		$	7,566		$	12,732		$	47,908

Compass Diversified Holdings Net Income (Loss) from Continuing Operations to Non-GAAP Consolidated Adjusted EBITDA Reconciliation Six Months Ended June 30, 2025 (Unaudited)

	Corporate				5.11		BOA			Lugano			PrimaLoft			THP			Velocity Outdoor			Altor		Arnold			Sterno			Consolidated
Income (loss) from continuing operations	$	(28,023	)	$	8,764		$	17,257		$	(120,442	)	$	(176	)	$	2,589		$	(6,731	)	$	1,206	$	(14,941	)	$	9,966		$	(130,531	)
Adjusted for:
Provision (benefit) for income taxes		—			2,462			2,223			(255	)		928			770			113			642		9,815			3,198			19,896
Interest expense, net		53,926			(2	)		(2	)		15,762			(13	)		(7	)		(13	)		—		296			—			69,947
Intercompany interest		(80,936	)		7,091			7,720			31,805			8,143			5,024			3,096			9,553		4,034			4,470			—
Depreciation and amortization		(32	)		11,303			10,496			3,068			10,654			8,319			2,737			13,115		5,281			6,986			71,927
EBITDA		(52,238	)		29,618			37,694			(70,062	)		19,536			16,695			(798	)		24,516		4,485			24,620			34,066
Other (income) expense		12			(137	)		105			11,729			12			39			(210	)		590		21			(193	)		11,968
Non-controlling shareholder compensation		—			1,167			2,714			1,542			1,168			444			122			487		8			549			8,201
Impairment expense		—			—			—			31,515			—			—			—			—		—			—			31,515
Acquisition expenses		—			—			—			—			—			—			—			—		—			—			—
Integration services fee		—			—			—			—			—			875			—			—		—			—			875
Other⁽¹⁾		—			—			—			—			—			—			—			3,054		2,210			163			5,427
Adjusted EBITDA	$	(52,226	)	$	30,648		$	40,513		$	(25,276	)	$	20,716		$	18,053		$	(886	)	$	28,647	$	6,724		$	25,139		$	92,052

Compass Diversified Holdings Net Income (Loss) from Continuing Operations to Non-GAAP Consolidated Adjusted EBITDA Reconciliation Six Months Ended June 30, 2024 (Unaudited)

	Corporate				5.11		BOA			Lugano			PrimaLoft			THP			Velocity Outdoor			Altor		Arnold			Sterno			Consolidated
										(As Restated)																				(As Restated)
Income (loss) from continuing operations	$	(16,734	)	$	8,857		$	12,346		$	(145,430	)	$	(988	)	$	(7,604	)	$	(55,199	)	$	3,394	$	3,909		$	4,557		$	(192,892	)
Adjusted for:
Provision (benefit) for income taxes		—			3,010			2,469			545			584			(2,569	)		9,297			1,726		1,986			1,655			18,703
Interest expense, net		50,041			(1	)		(12	)		4,730			(5	)		(25	)		54			—		81			—			54,863
Intercompany interest		(76,587	)		6,780			10,791			25,337			9,046			4,920			5,582			3,877		3,497			6,757			—
Depreciation and amortization		484			11,581			10,849			2,400			10,650			10,645			5,282			8,170		4,414			9,890			74,365
EBITDA		(42,796	)		30,227			36,443			(112,418	)		19,287			5,367			(34,984	)		17,167		13,887			22,859			(44,961	)
Other (income) expense		463			74			132			83,836			3			(30	)		25,898			2,664		(9	)		(341	)		112,690
Non-controlling shareholder compensation		—			1,086			2,848			1,203			995			617			370			504		9			119			7,751
Impairment expense		—			—			—			—			—						8,182			—		—			—			8,182
Acquisition expenses		—			—			—			—			—			3,479			—			—		—			—			3,479
Integration services fee		—			—			—			—			—			875			—			—		—			—			875
Other		(3	)		—			—			—			—			90			—			—		—			315			402
Adjusted EBITDA	$	(42,336	)	$	31,387		$	39,423		$	(27,379	)	$	20,285		$	10,398		$	(534	)	$	20,335	$	13,887		$	22,952		$	88,418

Compass Diversified Holdings Net Sales to Pro Forma Net Sales Reconciliation (unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)		2025		2024		2025		2024
			(As Restated)				(As Restated)
Net Sales	$	478,690	$	426,705	$	932,465	$	837,531
Acquisitions⁽¹⁾		—		—		—		10,671
Pro Forma Net Sales	$	478,690	$	426,705	$	932,465	$	848,202

⁽¹⁾ Acquisitions reflects the net sales for The Honey Pot Co. on a pro forma basis as if the Company had acquired The Honey Pot Co. on January 1, 2024.

Compass Diversified Holdings Subsidiary Pro Forma Net Sales (unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
		2025		2024		2025		2024
(in thousands)			(As Restated)				(As Restated)
Branded Consumer
5.11	$	131,442	$	123,201	$	260,812	$	248,175
BOA		48,369		54,160		97,246		97,063
Lugano		26,771		12,025		53,616		22,818
PrimaLoft		24,855		25,291		48,500		47,832
The Honey Pot⁽¹⁾		32,798		24,182		68,989		55,018
Velocity Outdoor		15,213		18,711		28,414		48,610
Total Branded Consumer	$	279,448	$	257,570	$	557,577	$	519,516

Niche Industrial
Altor Solutions	$	83,305		52,213	$	159,562	$	105,617
Arnold Magnetics		38,432		43,155		72,440		84,442
Sterno		77,505		73,767		142,886		138,627
Total Niche Industrial	$	199,242	$	169,135	$	374,888	$	328,686

Total Subsidiary Net Sales	$	478,690	$	426,705	$	932,465	$	848,202

⁽¹⁾ Net sales for The Honey Pot Co. are pro forma as if the Company had acquired this business on January 1, 2024.