Latham's New CEO: A Strategic Bet on Material Conversion

LATHAM, NY – December 08, 2025 – Latham Group, the largest manufacturer of in-ground residential swimming pools in North America, has announced a significant leadership transition that signals a strategic doubling-down on market disruption. The company has appointed Sean Gadd, a 21-year veteran of building materials giant James Hardie, as its new President and Chief Executive Officer, effective January 5, 2026. The move isn't merely a change at the top; it's a calculated decision to import a playbook that has successfully driven 'material conversion' in another sector of the home construction industry, with the explicit goal of accelerating the shift from traditional concrete pools to modern fiberglass.

Gadd will succeed Scott Rajeski, who is retiring after more than eight years as CEO. Rajeski, who will remain as a special advisor to ensure a smooth transition, has a notable legacy, having guided Latham (Nasdaq: SWIM) through its April 2021 IPO and a period of substantial growth. However, his successor arrives with a specific and potent mandate: to leverage a career's worth of experience in sales, marketing, and go-to-market strategy to fundamentally change consumer preferences in the pool industry.

A Legacy of Growth and a New Mandate

Scott Rajeski’s leadership saw Latham navigate both significant expansion and what the company has termed a "difficult industry environment." Under his tenure, Latham solidified its position as a market leader and advanced the adoption of fiberglass pools and automatic safety covers. "It has been a privilege to serve as the President & CEO of Latham," Rajeski noted, expressing pride in retiring with the company in a "strong financial position and in very capable hands."

Yet, the industry headwinds are real. The residential pool market, after a pandemic-fueled surge, has faced normalization, compounded by inflation, rising interest rates, and labor shortages. These pressures were reflected in Latham’s recent performance. The company’s third-quarter 2025 results fell short of analyst expectations, with revenue of $161.9 million and earnings per share of $0.07 missing consensus forecasts. While the company projects a market rebound to 78,000 new pools annually within the next five years, the immediate landscape remains challenging.

This is the complex environment Sean Gadd will inherit. His appointment is a clear signal from the board that the path forward requires not just steady leadership, but aggressive, strategic execution. As Chairman James E. Cline stated, "The Board believes Sean will be able to leverage his robust commercial experience, sector knowledge, and branding expertise to accelerate our ability to continue to gain share and further the conversion to fiberglass from concrete pools."

The Material Conversion Playbook

To understand the board's confidence, one must look at Gadd's transformative tenure at James Hardie. Most recently as President of North America, he was instrumental in the company’s substantial organic net sales growth. His success was built on a refined strategy of material conversion and deep market penetration.

At James Hardie, Gadd helped perfect a go-to-market strategy that drove the widespread adoption of fiber cement siding over traditional materials like wood and vinyl. This was achieved by moving beyond a simple B2B sales model and targeting the end-user: the homeowner. Through powerful brand-building campaigns and by educating both consumers and channel partners, James Hardie established a dominant 90% market share in the U.S. fiber cement category.

The parallels to Latham's mission are striking. Fiberglass pools, which already account for 75% of Latham's in-ground pool sales, hold just 24% of the total U.S. market. The vast majority of installations are still concrete. This gap represents a massive opportunity. Gadd's experience is in convincing an entire industry ecosystem—from builders to homeowners—to embrace a superior, more modern material. His challenge is to replicate that success, trading fiber cement for fiberglass.

"I am pleased to be joining Latham and am looking forward to building on its achievements to date," Mr. Gadd commented. "This is an excellent opportunity for me to utilize my experience in the building products category to drive further market penetration and adoption of Latham’s top-quality products."

Targeting the Sunbelt: A Cross-Industry Strategy

A key battleground for this strategy will be Latham’s "Sand State" initiative. This priority targets Florida, Texas, Arizona, and California—states that represent the lion's share of U.S. pool installations but where fiberglass adoption significantly lags the national average. Successfully converting these markets is crucial for Latham’s long-term growth.

Here again, Gadd’s background is directly relevant. His work at James Hardie involved building and nurturing extensive networks of distributors and building professionals while simultaneously creating pull-through demand from consumers. This dual-pronged approach is precisely what's needed to expand Latham's dealer network and educate a new generation of builders in the Sunbelt on the installation and benefits of fiberglass pools. The company has openly stated its goal is to replicate the 70% fiberglass penetration rate seen in Australia, a market that demonstrates the material's potential dominance.

Gadd's arrival signals a potential disruption. While pools and siding are different products, the underlying business dynamics—manufacturing, dealer-based distribution, and influencing homeowner choice during a major construction project—are remarkably similar. His fresh perspective, honed in the highly competitive building materials space, could inject new energy and innovative tactics into a more traditional industry.

Navigating the Future of Outdoor Living

Beyond simply swapping one pool material for another, Gadd's leadership is poised to position Latham at the center of broader trends reshaping the American backyard. The modern pool is no longer just a place to swim; it's the centerpiece of a comprehensive outdoor living experience, complete with smart automation, sustainable features, and luxury customization.

With over 60% of existing pools still lacking automation, the upgrade market is significant. Meanwhile, new buyers are increasingly demanding energy-efficient systems, saltwater solutions, and compact designs like plunge pools that fit smaller spaces. Gadd's experience in consumer-centric branding at James Hardie, which launched its successful 'It's Possible' campaign to homeowners, will be invaluable in marketing Latham's products not just as components, but as integral parts of a desirable lifestyle.

The appointment of Sean Gadd is therefore more than a succession plan; it's a strategic acquisition of talent and experience tailored for a specific mission. It represents a conviction that the strategies used to transform the exterior of the American home can be used to transform its backyard. Gadd's mandate is clear: to not just sell more pools, but to fundamentally reshape what homeowners expect from their backyard oasis, one fiberglass shell at a time.