Myers Industries Q2 Earnings Call Highlights

Key Points

• Strong second-quarter performance: Revenue rose 9.8% year over year, while adjusted EPS increased 60.6% to $0.53 and adjusted EBITDA grew 30.6%. Infrastructure and food-and-beverage revenue climbed 52% and 48%, respectively.
• Margins improved and leverage declined: Adjusted operating margin expanded to 16.7%, while free cash flow reached $26.5 million. Myers reduced net debt by $21.2 million, lowering net leverage to 1.9 times.
• Growth opportunities remain balanced with near-term risks: European military ammunition packaging is expanding, with revenue expected to grow 10%–15% annually through 2028. However, infrastructure demand may moderate seasonally, and higher resin costs are expected to pressure third-quarter margins.

Myers Industries NYSE: MYE reported second-quarter 2026 revenue growth of 9.8% year over year, supported by strength in infrastructure and food and beverage markets, while adjusted margins and earnings also improved as the company advanced its Focused Transformation program.

President and Chief Executive Officer Aaron Schapper said the quarter reflected progress in strengthening the business through improved operating efficiency, cost management, pricing actions and investments in selected growth platforms. Adjusted earnings per share rose 60.6% from the prior year to $0.53, while adjusted EBITDA increased 30.6%.

Infrastructure and Food & Beverage Drive Growth

Infrastructure revenue increased 52% during the quarter, driven by utility-related projects supporting data-center construction and demand for composite ground protection products on large construction projects. Schapper said some construction customers are converting from wood to composite ground matting, which is designed to provide stable work surfaces and reduce potential environmental remediation costs.

Signature’s turf protection products were also used at multiple FIFA World Cup events, increasing awareness of the company’s offerings, Schapper said. Chief Financial Officer Samantha Rutty said demand connected to the World Cup contributed to a particularly strong second quarter for the infrastructure business, though the company expects turf protection demand to moderate after the event concluded.

Food and beverage revenue rose 48%, led by demand for seed boxes and intermediate bulk containers, or IBCs. Myers raised its full-year outlook for the food and beverage end market to moderate growth from a prior expectation of a slight decline. Rutty said the update reflected both second-quarter performance and continued quoting activity and backlog, particularly for IBC products.

Net sales would have increased 13% year over year excluding the impact of Myers’ fourth-quarter 2025 decision to exit low-margin products and idle two rotational molding facilities in Alliance, Ohio, according to Rutty. The actions represent approximately $5 million of quarterly revenue, primarily in industrial and consumer markets, but were expected to benefit earnings.

Margins Expand, Debt Falls

Adjusted gross margin expanded 310 basis points to 34.6%, driven by volume, product mix, pricing and lower manufacturing costs despite higher resin costs. Adjusted operating margin increased 410 basis points to 16.7%, while adjusted EBITDA margin rose 350 basis points to 21.8%.

Second-quarter operating cash flow was $32.1 million, and capital expenditures totaled $5.6 million, resulting in free cash flow of $26.5 million, up 10.5% from the first quarter. Myers ended the quarter with $47.6 million in cash and total liquidity of $292.3 million.

The company reduced net debt by $21.2 million during the quarter, lowering its net leverage ratio to 1.9 times from 2.8 times a year earlier. Rutty said Myers plans to further reduce debt during 2026. The company also restructured its borrowings with a new $250 million revolving credit facility and a $250 million term loan, extending debt maturities to 2031 without changing total debt.

Myers expects full-year capital expenditures to equal about 3.5% of sales, with spending directed toward organic growth, productivity initiatives, infrastructure, European military production, automation and mold and press replacements.

Military Packaging Expansion in Europe

Schapper highlighted military ammunition packaging as a growth platform. Myers supplies ammunition containers to U.S. defense customers and NATO allied nations, and said its engineered packaging can reduce weight by up to 40% compared with traditional wood and steel products.

The company began producing military ammunition containers in Europe through Scepter International Poland, with initial customer shipments beginning in April. In response to an analyst question, Schapper said Myers historically exported military products to Europe but determined that establishing local production with a Poland partner would better serve customers seeking supply closer to home. Myers supplies raw materials, tooling, engineering expertise and product specifications under the arrangement, he said.

Myers also introduced a 120-millimeter tank container that uses the same mold base as its established 155-millimeter C137 artillery container. Schapper said the shared tooling platform allows the company to expand its offering with limited incremental capital investment.

Ammo packaging revenue increased to $49 million in 2025 from $20 million in 2024. Management said it sees a serviceable market of approximately $300 million and expects ammunition packaging revenue to grow at a compound annual rate of 10% to 15% through 2028.

Outlook Includes Seasonality and Resin-Cost Pressure

Myers reaffirmed its outlook for other end markets. It expects continued strong infrastructure growth, although third-quarter activity is expected to be somewhat softer than the second quarter because of seasonality, drier ground conditions and reduced World Cup-related demand. Rutty said backlog entering the third quarter remained strong compared with the prior year.

The company expects stable vehicle-market sales overall, with continuing weakness in U.S. recreational vehicles tied to higher interest rates, fuel prices and weak consumer confidence. Myers expects strong growth in marine and commercial vehicle demand, while automotive original-equipment manufacturer program launches are expected to support component packaging demand beginning in the second half of the year. Schapper said the company expects passenger automotive activity to show improvement more specifically in the fourth quarter.

Management expects stable consumer sales and average storm activity. It also said higher resin costs, influenced by geopolitical conditions and Middle East conflict, are likely to pressure third-quarter margins. Myers has taken selective and contractual pricing actions, though Rutty said price recovery typically lags increases in material costs.

Schapper also said Myers is continuing to work through the sales process for its MTS business, though he did not provide a timetable.

About Myers Industries (NYSE:MYE)

Myers Industries, Inc is a diversified manufacturer of polymer products serving industrial, commercial and consumer markets. The company designs, produces and markets a broad range of molded and fabricated plastic components, including pallets, bulk containers, tanks and drums used in material handling and storage applications. Myers Industries leverages proprietary polymer technologies to provide durable, reusable solutions that help customers optimize supply chain efficiency and reduce environmental impact.

Myers operates primarily through two business segments.

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