Companies / Medline Borrower
Medline Borrower MDLN
Capital Structure
| Cap Structure | Amt Out. | Mkt Price | Yield | Lev. Through | View |
|---|---|---|---|---|---|
| Unrestricted Cash | $2,321.0 | ||||
| 3.875% Senior Secured Notes due 2029 | 4,500.0 | 96.9%* | 5.22% | NA | Neutral |
| 6.250% Senior Secured Notes due 2029 | 1,000.0 | 101.7%* | 5.50% | NA | Bearish |
| 5.000% Senior Secured Notes due 2031 | 1,250.0 | 100.0% | 5.00% | NA | Neutral |
| Senior Secured Term Loan due 2033 (2033 Refinancing Term Loan Facility) | 2,743.0 | 100.0% | N/a | NA | Neutral |
| 5.250% Senior Secured Notes due 2033 | 750.0 | 100.0% | 5.25% | NA | Neutral |
| 5.250% Senior Notes due 2029 | 2,500.0 | 99.4%* | 5.48% | NA | Neutral |
| Total Debt | $12,579.0 | NA | |||
| Net Debt | $10,258.0 | NA |
Last Twelve Months
| Revenue | -- |
| Implied Costs | -- |
| Adj. EBITDA | -- |
| (-) Interest Expense | (61) |
| (-) Capex | (96) |
| Memo: FCF | $316 |
| Total Liquidity | $3,283.0 |
Medline Borrower
| 9/26/26 | Face Value / Adj. EBITDA | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cap Structure | Coupon | Maturity | Amt Out. | Mkt Price | YTM | Next Call | Yield to Call | View | 2023A | 2024A | 2025A | LTM |
| Unrestricted Cash | $2,321.0 | |||||||||||
| Undrawn Revolver ($1,000mm facility) | 962.0 | |||||||||||
| Total Liquidity | $3,283.0 | |||||||||||
| 3.875% Senior Secured Notes due 2029 | 3.875% | 4/1/2029 | 4,500.0 | 96.9%* | 5.22% | 10/1/2025 @ 100 | 10.41% | Neutral | ||||
| 6.250% Senior Secured Notes due 2029 | 6.25% | 4/1/2029 | 1,000.0 | 101.7%* | 5.50% | 4/1/2027 @ 101.563 | 5.83% | Bearish | ||||
| 5.000% Senior Secured Notes due 2031 | 5.00% | 6/15/2031 | 1,250.0 | 100.0% | 5.00% | 5/15/2031 @ 100 | 5.00% | Neutral | ||||
| Senior Secured Term Loan due 2033 (2033 Refinancing Term Loan Facility) | S + 150 | 5/28/2033 | 2,743.0 | 100.0% | N/a | 11/28/2026 @ 100 | N/a | Neutral | ||||
| 5.250% Senior Secured Notes due 2033 | 5.25% | 6/15/2033 | 750.0 | 100.0% | 5.25% | 4/15/2033 @ 100 | 5.25% | Neutral | ||||
| Total Secured Debt | $10,243.0 | 4.5x | 3.2x | NA | NA | |||||||
| Net Secured Debt | $7,922.0 | 3.5x | 2.5x | NA | NA | |||||||
| 5.250% Senior Notes due 2029 | 5.25% | 10/1/2029 | 2,500.0 | 99.4%* | 5.48% | 10/1/2025 @ 100 | 6.52% | Neutral | ||||
| Other debt, discounts and issuance costs | N/a | N/a | (164.0) | |||||||||
| Total Debt | $12,579.0 | 5.5x | 4.0x | NA | NA | |||||||
| Net Debt | $10,258.0 | 4.5x | 3.2x | NA | NA | |||||||
| Adj. EBITDA | $2,279 | $3,184 | -- | -- | ||||||||
Key Financials
| 2023A | 2024A | 2025A | LTM | |
|---|---|---|---|---|
| Revenue | $23,231 | $25,507 | -- | -- |
| Y/Y Growth | 9.8% | |||
| (-) Cost of Revenue | (17,346) | (18,531) | -- | (16,912) |
| Gross Profit | $5,885 | $6,976 | -- | -- |
| Gross Margin | 25.3% | 27.3% | ||
| (-) SG&A | (3,867) | (4,108) | -- | (3,782) |
| (+/-) Other Operating Costs, net of D&A | 183 | 255 | -- | -- |
| EBITDA | $2,201 | $3,123 | -- | -- |
| (+) Add-backs: stock comp, restructuring, impairments | 78 | 61 | -- | -- |
| Adj. EBITDA | $2,279 | $3,184 | -- | -- |
| Margin | 9.8% | 12.5% | ||
| (-) Restructuring and other cash add-backs | -- | -- | -- | -- |
| Cash EBITDA | $2,279 | $3,184 | -- | -- |
| (-) Interest Expense (Cash Only) | (1,126) | (1,022) | -- | (61) |
| (-) Cash Taxes | (52) | (101) | -- | (216) |
| (-) Capex | (275) | (354) | -- | (96) |
| (+/-) Working Capital and Other | 584 | (292) | -- | -- |
| Memo: FCF | $1,410 | $1,415 | -- | $316 |
| % of Debt | 11.2% | 11.2% | 2.5% |
Liquidity
| Unrestricted Cash | $2,321.0 |
| Undrawn Revolver | 962.0 |
| Total Liquidity | $3,283.0 |
| (-) Debt due through 2028 | -0.0 |
| (+/-) Free cash flow, last twelve months | 316.0 |
| Liquidity after maturities and a year of cash flow | $3,599.0 |
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Key Financials
| 2023A | 2024A | 2025A | LTM | |
|---|---|---|---|---|
| Revenue | $23,231 | $25,507 | -- | -- |
| Y/Y Growth | 9.8% | |||
| (-) Cost of Revenue | (17,346) | (18,531) | -- | (16,912) |
| Gross Profit | $5,885 | $6,976 | -- | -- |
| Gross Margin | 25.3% | 27.3% | ||
| (-) SG&A | (3,867) | (4,108) | -- | (3,782) |
| (+/-) Other Operating Costs, net of D&A | 183 | 255 | -- | -- |
| EBITDA | $2,201 | $3,123 | -- | -- |
| (+) Add-backs: stock comp, restructuring, impairments | 78 | 61 | -- | -- |
| Adj. EBITDA | $2,279 | $3,184 | -- | -- |
| Margin | 9.8% | 12.5% | ||
| (-) Restructuring and other cash add-backs | -- | -- | -- | -- |
| Cash EBITDA | $2,279 | $3,184 | -- | -- |
| (-) Interest Expense (Cash Only) | (1,126) | (1,022) | -- | (61) |
| (-) Cash Taxes | (52) | (101) | -- | (216) |
| (-) Capex | (275) | (354) | -- | (96) |
| (+/-) Working Capital and Other | 584 | (292) | -- | -- |
| Memo: FCF | $1,410 | $1,415 | -- | $316 |
| % of Debt | 11.2% | 11.2% | 2.5% |
Earnings call: Q3 2026 · Nov 4, 2026
Sales grew about 10% again and Medline raised its organic sales guide, held EBITDA guidance, prepaid $750 million of term loan and authorized a $1 billion buyback.
Takeaways
- Q3 net sales rose 10.4% to $7.86 billion, with organic growth of 10.5%. Growth came from existing customers and new contracts signed in 2025. Supply Chain Solutions grew 13.9% and Medline Brand grew 6.6%.
- Adjusted EBITDA rose 11.8% to $960 million, a 12.2% margin. That includes $81 million of net IEEPA tariff refund benefit. Without it, EBITDA was about $879 million and margin fell to about 11.2% from 12.1%, hit by inflation in inventory costs, higher operating expenses and customer mix.
- Cash flow is strong. Nine month operating cash flow was $2.2 billion and free cash flow was $1.8 billion after $348 million of capex. Tariff refunds and favorable working capital helped.
- Net leverage fell to 2.5x at September 26, from 2.9x at June 27 and 3.1x at March 28. Total debt was $12.7 billion against $2.3 billion of cash.
- One-off hits continue below Adjusted EBITDA. Nine month losses from the Tracy, California distribution center fire were $316 million net of insurance. In October Medline began exiting all Medline Brand beds, with costs estimated at up to $220 million over 2026 and 2027.
- Tariff refunds remain a swing factor. Nine month net refund benefit was $324 million, partly offset by money owed back to customers. Guidance excludes these refunds.
Debt and capital
- Total debt was $12.74 billion at September 26, 2026, about flat versus $12.75 billion at June 27. Cash was $2.32 billion. Net leverage was 2.5x.
- In October Medline prepaid $750 million of its 2033 Refinancing Term Loan, cutting gross debt to roughly $12.0 billion.
- The board approved a $1 billion repurchase program in October covering Class A shares and Medline Holdings, LP units. Management framed priorities as reinvestment, continued debt paydown and opportunistic returns.
- Earlier refinancing (May 28, 2026 8-K): Medline Borrower issued $1.25 billion of 5.000% senior secured notes due 2031 and $750 million of 5.250% senior secured notes due 2033. It also put in place a roughly $2.75 billion 2033 term loan.
- Those proceeds repaid the 2028 dollar term loan in full, refinanced about $724 million of the 2030 term loan and redeemed about $500 million of the 6.250% secured notes due 2029. The new notes carry collateral release terms tied to an investment grade event.
Guidance
- Full year 2026 organic sales growth raised to 10.0% to 10.5%, from 9.0% to 10.0% in August. This is the third raise of the year (8.5% to 9.5% guide in May).
- Full year 2026 Adjusted EBITDA held at $3.3 billion to $3.4 billion. The range excludes the $324 million of net IEEPA tariff refunds booked through nine months.
- The bed market exit is not expected to materially affect 2026 results or guidance, per the October 21 8-K.
Tone: Confident and steady: management stressed double digit growth, cash generation and deleveraging while one-off fire, tariff and recall items cloud GAAP earnings.
Last quarter: Third quarter 2026
Sales rose 10.4% and Adjusted EBITDA rose 11.8%, helped by tariff refunds; EBITDA guidance held and net leverage fell to 2.5x.
Results
- Net sales were $7,856mm, up 10.4% from $7,115mm, with organic sales up 10.5%.
- Adjusted EBITDA was $960mm, up from $859mm; margin was 12.2% versus 12.1%.
- Net income was $318mm versus $322mm, and gross margin fell to 24.5% from 26.4%.
- Nine-month free cash flow was $1,804mm after $348mm of capex, which implies about $884mm in the quarter and $141mm of quarterly capex.
- Trailing twelve-month Adjusted EBITDA was $3,601mm and reported net leverage was 2.5x.
Why
- Growth came from existing customers and new customer contracts signed in 2025.
- Results include $81mm of net IEEPA tariff refund benefit in the quarter and $324mm over nine months, booked in the Medline Brand segment.
- Medline Brand Adjusted EBITDA rose 14.9% to $943mm, while Supply Chain Solutions fell 10.2% to $184mm as its margin dropped to 4.4% from 5.5%.
- Inflation in inventory costs, higher operating expenses and customer mix weighed on profit; a $122mm LIFO charge was added back to Adjusted EBITDA.
Balance sheet and guidance
- Total debt was $12,743mm against $2,321mm of cash and $1,287mm of short-term investments, for net debt of $9,135mm.
- After quarter end the company prepaid $750mm of its 2033 refinancing term loan and the board approved a $1bn share buyback.
- The tax receivable agreement liability rose to $4,415mm in total ($4,403mm long-term) from $3,542mm at year end.
- Full year 2026 organic sales growth raised to 10.0% to 10.5% from 9.0% to 10.0%.
- Full year 2026 Adjusted EBITDA of $3.3bn to $3.4bn reaffirmed; this range excludes IEEPA tariff refunds.
What to watch
- Guidance excludes tariff refunds, so nine-month EBITDA without the $324mm benefit is about $2,472mm and the range implies roughly $828mm to $928mm in the fourth quarter.
- Supply Chain Solutions margin keeps slipping as that segment grows faster, and gross margin fell nearly two points on inflation and mix.
- Tracy distribution center fire costs ($316mm net over nine months) and insurance recoveries, plus FDA remediation and the bed recall, sit in add-backs.
Filings
Earnings releases 4
- Nov 4, 20268-K for Nov 4, 2026: Results · Presentation or supplement
- Aug 5, 20268-K for Aug 5, 2026: Results · Presentation or supplement
- May 6, 20268-K for May 6, 2026: Results · Presentation or supplement
- Feb 25, 20268-K for Feb 25, 2026: Results · Presentation or supplement
Annual reports (10-K) 1
- Feb 25, 202610-K for Dec 31, 2025
Quarterly reports (10-Q) 3
- Nov 4, 202610-Q for Sep 26, 2026
- Aug 5, 202610-Q for Jun 27, 2026
- May 6, 202610-Q for Mar 28, 2026
Current reports (8-K) 6
- Oct 21, 20268-K for Oct 21, 2026: Regulation FD
- Oct 15, 20268-K for Oct 13, 2026: Director or officer change
- Jul 9, 20268-K for Jul 7, 2026: Director or officer change
- Jun 12, 20268-K for Jun 11, 2026: Shareholder vote
- Jun 2, 20268-K for May 28, 2026: Material agreement; New debt; Other event
- Dec 22, 20258-K for Dec 16, 2025: Material agreement; Director or officer change; Bylaw change; Other event
Proxy statements 1
- Apr 23, 2026DEF 14A for Jun 11, 2026
Coming up
- Feb 24, 2027Results. Full-year results for the period ending 2026-12-31. The date is an estimate: last year's filing date moved forward a year.
Recent 8-K filings
- Nov 4, 2026Reported results
- Oct 21, 2026Regulation FD disclosure
- Oct 15, 2026Director or officer change
- Aug 5, 2026Reported results
- Jul 9, 2026Director or officer change