Acme United Q2 2026 Earnings Call Transcript

Acme United (AMEX: ACU ) released second-quarter financial results and hosted an earnings call on Thursday. Read the complete transcript below. This transcript is brought to you APIs. For real-time access to our entire catalog, please visit for a consultation.

22. 3 million in sales for the quarter, with plans to expand its product offerings to retail and improve profitability through cost reductions. S. margins were impacted by tariffs.

Strategic growth initiatives include expanding Spill Magic capacity, advancing MedNap's regulatory compliance, and launching new SmartCompliance software for automatic replenishment. Future outlook is positive with expected growth in first aid and cutting tools, improving profitability at MiMedic, and continued margin expansion as high-tariff inventory is sold off. SG&A expenses increased due to MiMedic's advertising costs, impacting the bottom line, but net income still showed improvement compared to Q2 2025. The Canadian segment experienced modest growth, driven by the first aid business, with some weakness in the Westcott segment.

The company is actively pursuing further acquisitions and retail distribution expansion for MiMedic products. Full Transcript OPERATOR Good day and welcome to the Acme United second quarter 2026 financial results conference call. At this time, I'd like to turn the call over to your host, Walter Johnsen, Chairman and CEO. Please go ahead, sir.

Walter Johnsen, Chairman and CEO Good morning. Welcome to the second quarter 2026 earnings conference call for Acme United Corporation. I am Walter C. Johnsen, Chairman and CEO.

With me is Paul Driscoll, our Chief Financial Officer, who will first read a safe harbor statement. Paul Driscoll, CFO Forward-looking statements in this conference call, including, without limitation, statements related to the company's plans, strategies, objectives, expectations, intentions, and adequacy of capital and other resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Investors are cautioned that such forward-looking statements may involve risks and uncertainties, including, among others, those arising as a result of a challenging global macroeconomic environment characterized by continued high inflation, high interest rates, and the imposition of new tariffs or changes in existing tariff rates. In addition, we have experienced supply chain disruptions, and we may experience these disruptions in the future. We are also subject to additional risks and uncertainties as described in our periodic filings with the Securities and Exchange Commission and in our current earnings release. Walter Johnsen, Chairman and CEO Thank you, Paul.

Acme United made progress. During the second quarter of 2026, our net sales increased from $54 million to $63 million, an increase of 16%. 22. As you may remember, we acquired MiMedic in January 2026.

This addition to the Acme United family sells high-quality first aid kits designed to save lives. It extends the reach of our product line from simple retail kits to advanced ones with chest seals, tourniquets, and tools to clear airways. MiMedic today sells mostly directly to consumers and is seasonal. It has high gross margins and also high advertising and marketing costs.

Net sales in 2025 were $19 million. 3 million, with breakeven operations as expected. We are working to increase the core direct-to-consumer business as well as expand the product offering to retail. At the same time, we are addressing the product cost through our strong Asian sourcing team, consolidating freight with other Acme United shipments to reduce costs, and eliminating duplicate corporate functions.

The intention is to have strong profits from MiMedic during all quarters, with particular strength in the fourth quarter. This will take time, but we are realizing savings already. Our core businesses performed well in the second quarter. In the United States, net sales of first aid and medical products increased 10%, with growth in particular at mass market retailers.

Other strong contributors in the quarter were the Safety Maid promotional first aid business, MedNap antiseptic wipes, and Spill Magic cleanup products. Also in the United States, the Westcott cutting tools business increased 8% during the second quarter. As you may remember, our retail business last year was hurt by tariff and cost uncertainty, and many of our customers canceled their seasonal promotions. This has recovered, and we are seeing a resumption of growth.

Our Canadian business increased 3%, driven by industrial, retail, and online sales of our first aid business. In Europe, net sales increased 19% with strong growth of our Westcott cutting tools. 6% due to high margins at MiMedic. Without MiMedic, gross margins in the United States declined approximately 100 basis points due to the costs of high tariffs that were capitalized in our inventory and are now being sold.

This is an improvement from the first quarter, and we anticipate continued gross margin expansion as these products are sold in the coming quarters. When the war with Iran began, we placed orders for approximately $10 million of extra inventory to buffer potential product shortages and cost increases. We continue to maintain this extra level of stock a