This quarter's results met expectations. The core reason was that revenue declined 4% due to weather and tariff impacts, but cost discipline and operational efficiency drove margin improvement, leading to EPS growth.

Key data: Revenue $1.1 billion, down 4% YoY; Adjusted EBITDA margin 22.3%, up 50 bps YoY; Adjusted EPS $3.63, up 1% YoY.

Business progress: CCM revenue fell 5%, but margins improved to 27.4%, benefiting from procurement discipline and Carlisle Operating System (COS) efficiency; CWT revenue fell 1%, with margins declining to 15.2% due to unfavorable product mix. This quarter, the ThermaThin R-7 insulation product was launched and won an industry award. The company plans to release 10-12 new products in 2026, concentrated in the second half. Two rounds of price increases (5%-8% each) took effect in April, all used to offset high single-digit raw material inflation, contributing no incremental profit. Management emphasized that geopolitical risks (Iran conflict/Strait of Hormuz) could cause energy cost volatility, but further price increases are being prepared.

Guidance and outlook: Reiterated full-year revenue growth of approximately 3% , EBITDA margin expansion of approximately 50 bps, all driven by price increases; CCM Q2 margin approximately 31%, CWT full-year margin expansion of at least 100 bps. Management is cautious about the second half, as no recovery in new construction demand is assumed.

Risk/highlight signals: Positive signal is management stating that "orders improved at the end of the quarter, with March momentum better than the start of the year," and April activity is in line with seasonality; negative signal is a clear warning that the Iran conflict could "materially increase energy and input cost volatility," and price increases are fully offset by cost inflation, with no incremental profit.