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PHOENIX, AZ - Leslie’s, Inc. (NASDAQ:LESL), a leading retail store chain with $1.33 billion in annual revenue, announced significant changes to its corporate governance structure following a recent shareholder vote. The company, currently trading at $0.82 per share and identified as undervalued by InvestingPro’s Fair Value model, held its annual meeting on March 12, 2025, where shareholders approved amendments to the company’s Certificate of Incorporation and bylaws.
The approved changes include a provision that will allow for the removal of directors without cause starting at the 2027 annual meeting. Additionally, the amendments provide for the exculpation of certain company officers from liability to the fullest extent permitted by Delaware law. These governance changes come at a crucial time for Leslie’s, which maintains strong liquidity with a current ratio of 1.76, according to InvestingPro data. The changes are effective immediately, as the company filed the Seventh Amended and Restated Certificate of Incorporation with the Delaware Secretary of State on the same day as the vote.
The election of directors was also on the agenda, with three Class I directors elected for a two-year term expiring in 2027 and one Class II director elected for a one-year term expiring in 2026. The shareholders ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending October 4, 2025. Furthermore, the compensation paid to the company’s named executive officers received approval on a non-binding advisory basis.
The detailed voting results included overwhelming support for the governance changes, with significant majorities voting for the removal amendment and the exculpation amendment. The ratification of Ernst & Young LLP as the company’s auditor and the advisory vote on executive compensation also passed with strong shareholder backing.
Leslie’s, Inc., headquartered at 2005 East Indian School Road, Phoenix, Arizona, continues to uphold its commitment to aligning the interests of its leadership with those of its shareholders. The information reported is based on the company’s latest 8-K filing with the Securities and Exchange Commission. Investors looking for deeper insights can access Leslie’s comprehensive Pro Research Report, available exclusively on InvestingPro, which includes detailed analysis of the company’s financial health, valuation metrics, and growth prospects. The platform currently features 14 additional ProTips for Leslie’s, with the next earnings announcement scheduled for April 30, 2025.
In other recent news, Leslie’s, Inc. reported its first-quarter fiscal 2025 results, which showed revenue of $175.2 million, surpassing expectations of $172.93 million. However, the company posted an adjusted loss per share of -$0.22, slightly missing analyst forecasts of -$0.21. Looking forward, Leslie’s provided guidance for the second quarter and full fiscal year 2025 that did not meet analyst estimates, projecting revenue of $1.304-1.37 billion for the year, below the consensus of $1.362 billion. Additionally, S&P Global Ratings downgraded Leslie’s credit rating from ’B+’ to ’B’, citing increased leverage and compressed profitability, with expectations for leverage to remain in the low-5x area over the next year.
The company’s strategic initiatives, such as the development of local fulfillment centers, are underway, although their impact on sales remains uncertain. Meanwhile, Leslie’s stock is set to be removed from the S&P SmallCap 600 index due to a decrease in market capitalization, following the spin-off of SanDisk from Western Digital Corp (NASDAQ:WDC). This change might affect the stock’s visibility and liquidity as index-tracking funds adjust their portfolios. Telsey Advisory Group also revised its price target for Leslie’s shares from $3.75 to $3.00, maintaining a Market Perform rating. The adjustment reflects concerns about ongoing demand pressures and the company’s financial performance, despite some positive trends in comparable store sales.
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