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Vestis Reports First Quarter 2026 Results and Reaffirms Fiscal 2026 Outlook

Staff Report From Georgia CEO

Thursday, February 12th, 2026

Vestis Corporation (NYSE: VSTS), a leading provider of uniforms and workplace supplies, today announced its results for the first quarter ended January 2, 2026.

First Quarter 2026 Highlights

  • Revenue of $663.4 million

  • Operating Income of $16.6 million

  • Net Loss of $6.4 million or $(0.05) per diluted share

  • Adjusted Net Income* of $13.1 million or $0.10 per diluted share

  • Adjusted EBITDA* of $70.4 million

  • Cash Flow Provided by Operating Activities of $37.7 million, Free Cash Flow* of $28.3 million, and Adjusted Free Cash Flow* of $42.9 million

  • Available liquidity of $316.7 million including $41.5 million Cash and Cash Equivalents on hand

 

Management Commentary

"Our first quarter results reflect a solid start to our fiscal 2026 and strong execution against our business transformation plan focused on unlocking operating leverage while elevating the customer experience," said Jim Barber, President and CEO. "Based on our performance to date and initiatives underway, we are reaffirming our fiscal 2026 outlook and expect continued sequential improvements in quarterly Adjusted EBITDA throughout the year."

"We have made meaningful progress advancing our operational excellence priorities," continued Barber. "During the quarter we saw significant improvements in plant productivity, on-time deliveries and customer satisfaction. Moving forward, we are driving continued standardization across the network, strengthening service quality, and better aligning resources across our footprint where we are encouraged by the pace of improvement in service consistency."

"Commercially, we are focused on improving revenue quality," concluded Barber. "Momentum from progress to date, coupled with investment in new customer and product segmentation tools, is expected to drive increased profitability as we progress through the year."

Strategic Business Transformation

During the first fiscal quarter of 2026, the Company launched a strategic business transformation plan ("the Plan") designed to make the Company more customer focused, agile and efficient – while positioning it for long-term profitable growth. Once fully implemented, the Plan is expected to generate annual operating cost savings of at least $75 million by the end of fiscal 2026 and to enhance revenue. The Plan is on track and structured around three strategic priorities: Operational Excellence, Commercial Excellence and Asset & Network Optimization.

  • Operational Excellence: During the first quarter, the Company executed on its initiative to reduce costs in our plant operations while improving service quality. These efforts resulted in a 7% improvement in plant productivity, a 3% improvement in on-time deliveries and a 12% reduction in customer complaints, when compared to the first quarter of 2025.

  • Commercial Excellence: During the first quarter, the Company made progress in its implementation of critical decision support tools that will enable successful strategic execution and improved revenue quality. These initiatives will lay the foundation to establish improved commercial engagement, a more favorable product sales mix, a strategic pricing model and better customer penetration.

  • Asset & Network Optimization: During the first quarter, the Company undertook market studies and analyzed key inputs for network optimization as it strategically evaluates its network of assets and the growth opportunities within its markets. In addition, the Company is actively marketing several non-core properties for sale to optimize its asset footprint. The Company intends to use proceeds of non-core properties sold to repay debt.

First Quarter 2026 Financial Performance

Revenue for the fiscal first quarter totaled $663.4 million, a decrease of $20.4 million year over year or 3.0% on flat total volume as measured by pounds processed through our market centers. The decrease in revenue versus the prior year period reflects a $17.9 million decrease in rental revenue, a $2.7 million decrease in direct sales revenue and a $0.2 million positive impact of foreign exchange on currency related to our Canadian business. The decrease in revenue versus the prior year period also reflects a decrease in revenue per pound, driven by changes in product sales mix within the Company’s rental business, related to increases in certain workplace supplies products, such as linen, and attributable to commercial practices that were in place before our strategic business transformation but are no longer in effect.

Net loss for the fiscal first quarter totaled ($6.4) million or ($0.05) per diluted share, compared to net income of $0.8 million, or $0.01 per diluted share, during the first quarter of fiscal 2025, a decrease of $7.2 million. Net loss as a percentage of revenue, or net margin, was (1.0%) during the first quarter of fiscal 2026, compared to 0.1% in the prior year period.

Adjusted EBITDA* for the fiscal first quarter was $70.4 million, or 10.6% of revenue, compared to $81.2 million or 11.9% of revenue, in the first quarter of 2025. The decreases year over year are primarily attributable to a 2.8% decrease in revenue per pound, which was partially offset by improvements in operating expenses resulting from the Company’s strategic business transformation.

Net loss and Adjusted EBITDA* improved sequentially compared to the fourth quarter of fiscal 2025, when net loss was ($12.5) million or (1.8)% of revenue, and Adjusted EBITDA* was $64.7 million, or 9.1% of revenue. When compared to the fourth quarter of fiscal 2025, the improvements reflect the sequential improvement in cost per pound* and resulting operating leverage*, supported by the successful execution of the Company’s business transformation plan.

Cash Flow and Balance Sheet

Net cash provided by operating activities during the first quarter of fiscal 2026 was $37.7 million and Free Cash Flow* was $28.3 million. Net cash provided by operating activities during the first quarter of fiscal 2026 includes $14.6 million in non-recurring cash payments associated with the Company’s strategic business transformation plan. Excluding the impact of these payments, net cash provided by operating activities and Adjusted Free Cash Flow* increased by $48.5 million and $53.9 million, respectively, when compared to the first quarter of fiscal 2025. The increase in net cash provided by operating activities reflects a $12.7 million benefit from cash generated from working capital in the first quarter of fiscal 2026, a working capital improvement of $27.2 million when compared to the first quarter of fiscal 2025.

During the first quarter of 2026, we invested $9.4 million in property and equipment, the majority of which is related to investment in our plant operations, supporting the Company’s operational excellence initiatives.

As of January 2, 2026, Vestis had total cash and excess availability under its revolving credit facility of $316.7 million as compared to $313.3 million at the end of the first quarter of 2025.

Fiscal Year 2026 Outlook

Today, the Company reaffirmed its outlook for fiscal 2026. The Company continues to expect fiscal 2026 revenue to be between flat to down 2% and Adjusted EBITDA* to be in the range of $285 million and $315 million. Additionally, the Company expects fiscal 2026 Free Cash Flow* to be in the range of $50 million to $60 million.

For fiscal 2026, the Company expects that Adjusted EBITDA* will improve approximately 5% on a sequential basis for each of the remaining quarters of the fiscal year, driven by the Company’s business transformation efforts and a reduction in its operating cost per pound.

First Quarter 2026 Results Conference Call & Webcast

Vestis will host a conference call on Tuesday, February 10, 2026, at 8:30 a.m. Eastern Time to discuss its fiscal first quarter 2026 results.

For a live webcast of the conference call and to access the accompanying investor presentation, please visit the investor relations section of the Company’s website at www.vestis.com.

To participate in the live teleconference:

Unites States Live: 800-267-6316
International Live: 203-518-9783
Access Code: VSTSQ126

A replay of the live event will also be available on the Company’s website shortly after the conclusion of the call.