Q.E.P. Co Inc Reports Second Quarter and Six-Month Fiscal 2027 Financial Results
News related to:Q.E.P. Co., Inc · 3 min read
BOCA RATON, Fla., Oct. 15, 2026 /CourierPR/ -- Q.E.P. Co., Inc., a manufacturer and distributor of flooring installation solutions, reported financial results for the first six months and second quarter of fiscal year 2027, which ended on August 31, 2026. Net sales for the six-month period reached $122.0 million, marking an increase of $2.8 million or 2.4% from the $119.2 million reported in the same period of fiscal 2026. For the second quarter alone, net sales stood at $61.1 million, up $3.4 million or 5.9% from $57.7 million reported in the second quarter of fiscal 2026.
The growth in sales was attributed to the continued expansion in the professional distribution channel, particularly in adhesive products, and successful retail initiatives.
Operating expenses for the first six months of fiscal 2027 amounted to $30.0 million, or 24.6% of net sales, compared to $32.9 million or 27.6% of net sales in the corresponding fiscal 2026 period. For the second quarter, operating expenses were $13.5 million, or 22.1% of net sales, compared to $16.0 million or 27.8% of net sales in the second quarter of fiscal 2026. The increase in operating expenses was primarily due to higher shipping, general and administrative, and selling and marketing expenses.
Gross profit for the first six months of fiscal 2027 was $42.7 million, down $0.6 million or 1.4% from $43.3 million in the same period of fiscal 2026. For the second quarter, gross profit was $20.9 million, up $0.3 million or 1.5% from $20.6 million in the second quarter of fiscal 2026. Gross margins for the first six months and second quarter of fiscal 2027 were 35.0% and 34.2%, respectively, down from 36.3% and 35.7% in the same periods of the prior fiscal year. The decline in gross margins reflects the continued impact of higher tariff costs and more recent increases in fuel and other input costs.
The company's financial strength provided a solid foundation during uncertain times, allowing it to return capital to stockholders through regular quarterly cash dividends and stock repurchases of $9.2 million during the first six months of fiscal 2027. Interest income for the first six months of fiscal 2027 was $0.7 million, up $0.3 million from $0.4 million in the same period of fiscal 2026. Excluding interest income related to the International Emergency Economic Powers Act (IEEPA) tariff refunds, operating expenses increased compared with the prior-year periods.
Net income from continuing operations for the first six months and second quarter of fiscal 2027 was $9.9 million and $5.8 million, respectively, or $3.29 and $1.97 per diluted share. For the comparable periods of fiscal 2026, net income from continuing operations was $8.0 million and $3.5 million, respectively, or $2.45 and $1.09 per diluted share.
Earnings before interest, taxes, depreciation, and amortization (EBITDA) from continuing operations for the first six months and second quarter of fiscal 2027 were $13.6 million and $7.9 million, respectively, or 11.2% and 12.9% of net sales. This compares to EBITDA of $11.1 million and $5.0 million, or 9.3% and 8.6% of net sales for the corresponding periods of fiscal 2026. Fiscal 2027 EBITDA includes refunds of IEEPA tariffs previously paid and recognized as expenses of $5.7 million for the first six months and $4.8 million for the second quarter. Management does not expect these refunds to be indicative of ongoing operating results.
Cash provided by operations during the first six months of fiscal 2027 was $17.3 million, reflecting the receipt of IEEPA tariff refunds and higher trade payables and accrued liabilities. The company used cash generated from operations to repurchase shares of common stock, pay dividends, fund capital expenditures, and increase available cash. As of August 31, 2026, working capital remained stable at $74.7 million, compared to $75.5 million as of February 28, 2026. The company ended the second quarter of fiscal 2027 with a net cash position of $40.1 million, compared to $34.1 million as of February 28, 2026.