Boyd Group Services (TSE:BYD) reported second-quarter 2026 revenue above $1 billion for the first time, as the company expanded its footprint, integrated Joe Hudson’s Collision Center and advanced its Project 360 cost-transformation program.
Revenue rose 30% year over year to $1.013 billion, while adjusted EBITDA increased 45% to $135.9 million. Adjusted EBITDA margin expanded 140 basis points to 13.4%, compared with 12.0% in the second quarter of 2025.
Joe Hudson integration accelerates synergy plans
Boyd said it completed the system conversion across all Joe Hudson’s locations during the quarter, creating a unified operating platform for the acquired business. Kaner said the conversion caused temporary sales disruption, but targeted efforts to improve throughput and local execution were gaining traction.
The company raised its 2026 synergy target from the Joe Hudson’s acquisition to $35 million, up from its previous estimate of $20 million. Kaner attributed the increase primarily to the faster pace of integration, including quicker access to operational data, accelerated back-office consolidation and movement to common supply-chain contracts.
Joe Hudson’s locations contributed $175 million in sales during the quarter. Boyd said the integration has included systems conversion, rebranding, substantial back-office migration, supply-chain alignment and internalization of scanning and calibration services. Kaner said there was “not really a lot left to do from an integration perspective,” allowing the company to apply its operating model across the acquired network of 258 locations.
Combined Project 360 savings and Joe Hudson’s synergies totaled about $15 million in the second quarter, management said. Gross profit rose 31% to $480 million, with gross margin increasing 60 basis points to 47.4%. The company cited stronger paint and parts margins, savings initiatives, and increased margins from scanning, calibration and sublet services.
Same-store sales outpace repair-volume trends
Boyd generated 2.9% same-store sales growth in the second quarter, despite estimating that industry repairable claims volumes were flat to down 2% year over year based on claims-processing data. Management said the comparison marked an improvement from the claims-volume decline experienced in the second quarter of 2025.
Kaner said same-store sales remained positive in the low-single digits in July, though he cautioned that monthly results can vary significantly and should not be viewed as indicative of an entire quarter.
The company attributed its outperformance to market-share gains, insurer relationships, improved carrier performance and a 2025 regional incentive realignment that tied field leadership compensation to performance for Boyd’s three largest clients. Kaner said the initiative has increased opportunities flowing into stores, with the company focused on converting those opportunities into repair work.
Management said growth in total cost of repair remained limited. Kaner pointed to several near-term pressures, including greater repair-versus-replace activity during periods of lower industry demand and a modest increase in alternative-parts usage. However, he said the longer-term outlook remains supported by the increasing cost to repair newer vehicles. According to Kaner, repairs for vehicles zero to three years old cost about C$2,000 more than the overall average repair and are approaching C$6,000.
On total losses, Kaner said the company expects only modest longer-term movement, estimating potential annual growth of roughly 0.3 percentage points. He noted that insurers, automakers and consumers all have incentives to limit total losses, while vehicle aging could exert some upward pressure. He also cited Rhode Island legislation requiring an 85% total-loss threshold, compared with an industry level that he said is closer to 70%.
Expanded footprint supports growth
Revenue growth included $211 million of incremental contributions from 340 locations that were not in operation for the full prior-year period. Boyd’s location footprint grew 32% year over year, supported by the Joe Hudson’s acquisition and new-location development.
Kaner said Boyd expects acquisition activity to accelerate in the second half, consistent with its historical pattern of starting the year slowly and finishing strongly. The company sees a “robust pipeline” of potential acquisitions in the fragmented collision-repair industry.
The company plans 13 new startups for the remainder of 2026, including 10 new-industry locations planned for the fourth quarter. Some planned projects were delayed or canceled after Boyd evaluated overlap with the Joe Hudson’s acquisition, Kaner said. Management said it ultimately aims to return its new-location pipeline to a more typical pace of about eight openings per quarter.
Boyd also sees room to improve technician capacity utilization. Kaner said the company tracks technician productivity through hours per technician per week and believes some additional capacity remains, even as it continues recruiting technicians. He said the company’s same-store growth has already absorbed part of that capacity.
Earnings and balance sheet
Operating expenses declined to 33.9% of sales from 34.8% a year earlier, an improvement of 90 basis points driven by Project 360 and Joe Hudson’s synergies.
Reported net earnings were $1.3 million, compared with $5.4 million in the prior-year period. Chief Financial Officer Jeff Murray said earnings were affected by higher depreciation and amortization associated with location growth, higher financing costs and a $5 million increase in amortization related to a revision of the initial purchase-price allocation for the acquisition.
Excluding that incremental intangible amortization, net earnings would have been $6.4 million, Murray said. Adjusted net earnings increased 47% to $22.4 million, while adjusted earnings per share rose to $0.80 from $0.71 a year earlier.
For full-year 2026, Boyd maintained its expectation for maintenance capital expenditures of 1.6% to 1.8% of sales. Capital expenditures tied to the Joe Hudson’s acquisition remain estimated at $30 million, with approximately $9.8 million invested through the second quarter.
Pro forma net leverage improved to about 2.8 times at quarter-end from 3.1 times at the end of fiscal 2025. Management said the company’s balance sheet and capital-light business model provide flexibility to fund future growth initiatives.
About Boyd Group Services (TSE:BYD)
Boyd Group Services Inc is a Canadian corporation and controls The Boyd Group Inc and its subsidiaries. Boyd Group Services Inc shares trade on the Toronto Stock Exchange (TSX) under the symbol BYD.TO and the New York Stock Exchange (NYSE) under the symbol BGSI. For more information on The Boyd Group Inc or Boyd Group Services Inc, please visit our website at https://www.boydgroup.com .
