Tennant : Reports 2026 First-Quarter Results Presentation

Published: 2026-05-05 11:13:08 ET TNC

Published on 05/05/2026 at 11:13 am EDT

Earnings Release Call

May 5, 2026

https://www.investors.tennantco.com

First Quarter 2026 Results

Adj. Diluted EPS*

$0.58/share

$1.12/share in Q1 2025

Adj. EBITDA*

$29.1M

9.8% Adj. EBITDA Margin

Net Sales

$297.9M

-1.9% Organic Decline

First Quarter

Highlights

Order Momentum Continues

Orders grew 10% during the first quarter, demonstrating strong and broad-based demand momentum

Backlog grew $32 million in the first quarter, as robust order entry outpaced shipments during the quarter

TNC Earnings Release Call | First Quarter 2026

Profitability Improvements

Gross margin and Adjusted EBITDA strengthened sequentially from the fourth quarter of 2025, as ERP stabilization drove improved throughput and operational execution

Return Capital to Shareholders

Returned capital to shareholders through dividends totaling $5.5 million and share repurchases for $60 million during the first quarter, representing ~5% of outstanding shares at the start of the year

*Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation

Tennant Company

ERP North America Recovery

North America ERP Recovery on Track; Shifting from Stabilization to Optimization

Stabilization Complete Shift to Optimization

Core workflows (order management, production scheduling, fulfillment) operating reliably at scale by quarter end

Operational performance improved sequentially each month through Q1

Focus moved from fixing functionality to driving throughput, labor productivity, and system-enabled performance

TNC Earnings Release Call | First Quarter 2026

Active work to phase out remaining manual workarounds and address friction points identified during stabilization

Path to Margin Recovery

EMEA Phase Deferred

Enterprise-level gross margin exit rate of approximately 40% in March supports confidence in continued recovery

Steady Q1 improvement reinforces trajectory of progressive gross margin expansion through the year

EMEA implementation intentionally pushed beyond 2026 to keep focus on North America recovery

Lessons learned from North America informing approach to future regional rollouts

Tennant Company

TNC Robotics Momentum

Acting Decisively to Capture the Robotic Cleaning Inflection Point

Brain Corp Partnership Extended

Exclusivity arrangement extended three additional years, securing exclusive BrainOS® access in our category

BrainOS® Clean 2.0 and SelfPath AI delivering 22% better floor coverage, 55% more autonomous operation, and 3x faster fleet deployment in early real-world use

New Products, New Channels

Launched X16 SWEEP (industrial robotic sweeper) and X2 ROVR (small-format scrubber); plan to bring 10 new AMR products to market over the next 24 months

TNC Earnings Release Call | First Quarter 2026

Expanding channel reach via BSCs and distribution partners; on track to deliver $250M in AMR revenue by 2028

Proven Scale

and Leadership

Profitable, U.S.-based robotics business; 11,500+ robots shipped

cumulatively since 2018

Q1 AMR sales (equipment and autonomy service fees) of approximately

$27M, or 9% of total net sales

X16 SWEEP

industrial robotic sweeper

TNC Robotics Venture Activated

Dedicated venture operating with the speed and urgency of an entrepreneurial startup

Accelerated by the full power of the core business: proven portfolio, preferred brands, channel reach, and 1,000+ field service technicians

X2 ROVR

small-format

scrubber

Tennant Company

Capital Allocation Framework

Disciplined Capital Allocation Driving Long-Term Shareholder Value

Invest in the Business

Prioritize organic growth, R&D, and operational improvements

Target ~3.0% to 3.5% of sales in R&D; $20M to $25M annual capex

Maintain Balance Sheet Strength

Targeted net leverage of 1x to 2x adjusted EBITDA

Expect leverage to trend toward lower end of range by year-end 2026

TNC Earnings Release Call | First Quarter 2026

Pursue Strategic M&A

Evaluate opportunities that meet strategic and financial criteria

Recent EMEA distributor acquisitions strengthened portfolio and capabilities

Return Capital to Shareholders

Share repurchases

$60M Deployed ~950K Shares $63 Avg Price ~5% of Shares Outstanding

Q1 2026 share repurchases: high-conviction response to event-driven dislocation

Continued disciplined dividend growth

First Quarter 2026

Tennant Company Earnings Release Call | First Quarter 2026

https://www.investors.tennantco.com

Tennant Company

First-Quarter 2026 Financial Performance

Net Income In millions of USD Adjusted EPS*

$13.1

$0.2

$1.12

First-quarter net income of $0.2M, compared to $13.1M in the prior year

Gross margin compression associated with ERP recovery efforts and shifting customer mix, coupled with higher operating and interest expense

Effective tax rate increased to 80.5% from 23.8% due to an increase of discrete tax costs associated with share-based compensation

Q1'25 Q1'26

First-quarter adjusted EPS* of $0.58 per diluted share

$0.58

TNC Earnings Release Call | First Quarter 2026

Reflects lower operating performance from ERP recovery activities and ongoing operational stabilization efforts in the quarter

Excludes amortization expense, ERP modernization costs, ERP amortization costs, legal contingency costs, legal and financial advisory costs, and restructuring-related charges

*Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation

Tennant Company

First-Quarter 2026 Results

Net Sales Adjusted EBITDA*

$290 M

$12 M

($16 M)

$12 M $298 M

$41 M

$12 M

($7 M)

($14 M)

($3 M)

$29 M

Q1'25 Net Sales Price Volume FX Q1'26 Net Sales

Q1'25 Adj. EBITDA

Price Volume Margin S&A / Other Q1'26

Adj. EBITDA

By Region**

Product Categories

Gross Margin decreased 330 bps to 38.1%

TNC Earnings Release Call | First Quarter 2026

Driven primarily by incremental labor, freight and expedited costs associated with our ERP recovery efforts earlier in the quarter

-3.0%

+1.0%

-2.0%

-1.9%

Americas

EMEA APAC

Total

Service

Parts and Consumables

Equipment

$50 M

$55 M

$67 M

$65 M

$173 M

$178 M

2025 Q1 Net Sales 2026 Q1 Net Sales

Decline was further impacted by mix, while pricing and cost fully offset tariffs and other inflationary pressures

Adjusted S&A* as a percent of net sales increased 90 bps to 29.6%

Driven by higher compensation and benefits, and higher software fees, compounded by lower North America volumes

Adjusted EBITDA Margin* decreased 430 bps to 9.8%

*Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation

**Organic net sales (decline) growth

Driven by gross margin compression related to ERP recovery costs and

tariff-related inflation, coupled with deleverage in S&A expense

Tennant Company

Capital Deployment

Cash Flow

$106 M

($31 M) ($3 M)

$85 M

($60 M) ($6 M)

($8 M)

$83 M

YE 2025 Q1 2026

Total Debt $273.6M $358.7M

Net Debt $167.2M $276.1M

Net Leverage* 1.00x 1.78x

2025 Cash Operating

Perfomance

CapEx Debt, net Share Repurchases Dividends Other Q1'26 Cash

Revolver Availability $289.3M

Capital Allocation Priorities

Invest in the Business

$3M of capital expenditures

$8M spent on ERP modernization

$6M on Income Statement

$2M on Balance Sheet

$11M spent on R&D investments

Shareholder Return

TNC Earnings Release Call | First Quarter 2026

$6M of Dividends

$60M on repurchases of ~950k shares of common stock

*Based on trailing twelve months Adjusted EBITDA 10

TNC Earnings Release Call | First Quarter 2026

Full-Year Guidance

(1) Non-GAAP Measures: refer to the Appendix of this presentation for additional information and reconciliation

$1.240B - $1.280B

Net Sales

3.0% - 6.5%

Organic Net Sales Growth

$4.05 - $4.65

Diluted EPS

$4.70 - $5.30

Adjusted Diluted EPS(1)

$175M - $190M

Adjusted EBITDA(1)

14.1% - 14.8%

Adjusted EBITDA Margin(1)

~$25M

Capital Expenditures

24% - 29%

Adjusted Effective Tax Rate(1)

https://www.investors.tennantco.com

TNC Earnings Release Call | First Quarter 2026

First Quarter 2026

Tennant Company Earnings Release Call | First Quarter 2026

https://www.investors.tennantco.com

Tennant Company

Non-GAAP Financial Measures

This presentation and the related conference call include presentation of Non-GAAP measures that include or exclude special items of a nonrecurring and/or nonoperational nature (hereinafter referred to as "special items"). Management believes that the Non-GAAP measures provide useful information to investors regarding the Company's results of operations and financial condition because they permit a more meaningful comparison and understanding of Tennant Company's operating performance for the current, past or future periods.

Management uses these Non-GAAP measures to monitor and evaluate ongoing operating results and trends and to gain an understanding of the comparative operating performance of the Company.

The Company believes that disclosing S&A expense - as adjusted, S&A expense as a percent of net sales - as adjusted, operating income - as adjusted, operating margin - as adjusted, income before income taxes - as adjusted, income tax expense - as adjusted, net income - as adjusted, net income per diluted share - as adjusted, EBITDA - as adjusted, and EBITDA margin - as adjusted (collectively, the "Non-GAAP measures"), excluding the impacts from special items, is useful to investors as a measure of operating performance. The Company uses these measures to monitor and evaluate operating performance. The Non-GAAP measures are financial measures that do not reflect United States Generally Accepted Accounting Principles (GAAP). The Company calculates the Non-GAAP measures by adjusting for legal contingency costs, ERP modernization costs, ERP amortization costs, legal and financial advisory costs, restructuring-related costs, transaction-related costs and amortization expense. The Company calculates income tax expense - as adjusted by adjusting for the tax effect of these Non-GAAP measures. The Company calculates net income per diluted share - as adjusted by adjusting for the after-tax effect of these Non-GAAP measures and dividing the result by the diluted weighted average shares outstanding. The Company calculates EBITDA margin - as adjusted by dividing EBITDA - as adjusted by net sales.

Tennant Company

TNC Earnings Release Call | First Quarter 2026

SUPPLEMENTAL NON-GAAP FINANCIAL TABLES

Tennant Company

TNC Earnings Release Call | First Quarter 2026

SUPPLEMENTAL NON-GAAP FINANCIAL TABLES

Tennant Company

TNC Earnings Release Call | First Quarter 2026

SUPPLEMENTAL NON-GAAP FINANCIAL TABLES

Tennant Company

TNC Earnings Release Call | First Quarter 2026

SUPPLEMENTAL NON-GAAP FINANCIAL TABLES

Tennant Company

TNC Earnings Release Call | First Quarter 2026

SUPPLEMENTAL NON-GAAP FINANCIAL TABLES

Disclaimer

Tennant Company published this content on May 05, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 05, 2026 at 15:12 UTC.