Industry Overview - The Zacks Industrial Services industry is currently facing challenges due to a prolonged contraction in the manufacturing sector, with customers being cautious about spending and rising input costs adding to the difficulties [1][4][5] - The industry comprises companies providing industrial equipment products and MRO services, serving a diverse range of customers including commercial, government, healthcare, and manufacturing [3] Current Trends - The manufacturing sector contributes approximately 70% to the industry's revenues, with recent data indicating a slight increase in industrial production by 1.6% over the past year, but the manufacturing index has been in contraction territory for several months [4] - The New Orders Index has contracted for four consecutive months, reflecting weak demand as companies are hesitant to invest in capital and inventory due to inflation and monetary policy [4] - Some industry players report easing supply-chain issues, which could lead to improved demand once conditions normalize [4] Pricing and Cost Management - The industry is experiencing significant inflation, with rising labor, freight, and fuel costs, leading companies to implement pricing actions and cost-cutting measures to mitigate these challenges [5] - Companies are focusing on improving productivity and efficiency while diversifying their supplier base to combat high costs [5] E-commerce Growth - E-commerce is expected to be a significant growth driver for the industry, with global e-commerce sales projected to rise from $5.8 trillion in 2023 to $8 trillion by 2027, reflecting a CAGR of 8.4% [6] - The U.S. e-commerce market is currently valued at $843 billion and is anticipated to exceed $1 trillion by 2026, with a CAGR of 11.82% from 2024 to 2028 [6] - Industrial service companies are investing heavily in digital capabilities to capitalize on the growing demand for tailored solutions and rapid product delivery [6] Industry Performance - The Zacks Industrial Services Industry currently holds a Zacks Industry Rank of 227, placing it in the bottom 10% of 251 Zacks industries, indicating bearish prospects in the near term [7] - Over the past year, the industry has underperformed compared to its sector and the Zacks S&P 500 composite, with a decline of 3.0% against the sector's growth of 7.8% and the S&P 500's increase of 18.6% [9] Valuation Metrics - The industry is trading at a forward 12-month EV/EBITDA ratio of 25.77X, significantly higher than the S&P 500's 14.99X and the Industrial Products sector's 18.92X [10] - Historically, the industry has traded between 6.04X and 29.00X over the past five years, with a median of 19.17X [10] Company Highlights - **W.W. Grainger, Inc. (GWW)**: Reported a 3% increase in revenues and a 5% increase in earnings in the second quarter, focusing on customer base expansion and digital capabilities [10][11] - **Global Industrial Company (GIC)**: Achieved a 6.8% increase in revenues, with strong performance in e-commerce and strategic acquisitions contributing to growth [11][12] - **DMC Global (BOOM)**: Experienced sequential improvement in sales and EBITDA, with a focus on operational efficiencies and cost management leading to margin recovery [12][13]

DMC Global Inc. (NASDAQ:BOOM) Q2 2024 Results Conference Call August 1, 2024 5:00 PM ET Company Participants Geoff High - Vice President, Investor Relations Michael Kuta - Chief Executive Officer Eric Walter - Chief Financial Officer Conference Call Participants Gerry Sweeney - Roth Capital Partners Stephen Gengaro - Stifel Ken Newman - KeyBanc Capital Markets Operator Greetings, and welcome to the DMC Global Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. A brief que ...

DMC Global (BOOM) reported $171.18 million in revenue for the quarter ended June 2024, representing a year-over-year decline of 9.3%. EPS of $0.29 for the same period compares to $0.72 a year ago. The reported revenue represents a surprise of +3.46% over the Zacks Consensus Estimate of $165.45 million. With the consensus EPS estimate being $0.13, the EPS surprise was +123.08%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determi ...

DMC Global (BOOM) came out with quarterly earnings of $0.29 per share, beating the Zacks Consensus Estimate of $0.13 per share. This compares to earnings of $0.72 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 123.08%. A quarter ago, it was expected that this diversified holding company would post earnings of $0.19 per share when it actually produced earnings of $0.21, delivering a surprise of 10.53%. Over the last four quar ...

Financial Performance - Net sales for Q2 2024 were $171,179,000, a decrease of 9.2% from $188,664,000 in Q2 2023[8] - Gross profit for Q2 2024 was $46,413,000, down 25.0% from $61,890,000 in Q2 2023[8] - Net income attributable to DMC Global Inc. stockholders for Q2 2024 was $4,012,000, a decline of 70.7% compared to $13,703,000 in Q2 2023[9] - Operating income for Q2 2024 was $11,685,000, a decrease of 56.6% from $26,997,000 in Q2 2023[8] - Comprehensive income attributable to DMC Global Inc. stockholders for Q2 2024 was $3,497,000, down from $14,149,000 in Q2 2023[11] - The net income for the six months ended June 30, 2024, was $8,612,000, compared to $19,665,000 for the same period in 2023, indicating a decrease of approximately 56.2%[18] - Net income attributable to DMC Global Inc. stockholders for the six months ended June 30, 2024, was $6,575, a decrease of 55% compared to $14,612 for the same period in 2023[130] - Adjusted EBITDA attributable to DMC Global Inc. decreased to $19,420 for the three months ended June 30, 2024, from $31,776 in the same period in 2023, a decline of 39%[111] - Adjusted EBITDA attributable to DMC Global Inc. was $36,103 for the six months ended June 30, 2024, down 30% from $51,867 in 2023[131] Assets and Liabilities - Total assets as of June 30, 2024, were $869,485,000, a decrease from $884,495,000 as of December 31, 2023[5] - Total liabilities decreased to $266,416,000 as of June 30, 2024, from $286,440,000 as of December 31, 2023[5] - Cash and cash equivalents were $14,567,000 as of June 30, 2024, down from $31,040,000 as of December 31, 2023[5] - The total debt as of June 30, 2024, was $84,112 million, down from $115,851 million as of December 31, 2023, showing a reduction of about 27.5%[62] - The redeemable noncontrolling interest was valued at $187,080 million as of June 30, 2024, compared to $187,760 million on December 31, 2023[29] - The company reported a significant increase in accounts payable, which rose to $22,070,000 for the six months ended June 30, 2024, compared to $10,015,000 in 2023[18] Cash Flow - Cash flows provided by operating activities for the six months ended June 30, 2024, were $15,783,000, down from $18,544,000 in the prior year, reflecting a decline of about 9.5%[18] - The company experienced a net cash decrease of $16,473,000 for the six months ended June 30, 2024, compared to a decrease of $6,420,000 in the same period of 2023[18] - Net cash flows used in financing activities for the six months ended June 30, 2024, totaled $39,727, which included net credit facility repayments of $31,500[173] Inventory and Expenses - Total inventories as of June 30, 2024, amounted to $174,791 million, compared to $166,712 million as of December 31, 2023, indicating an increase of about 4.5%[54][55] - Consolidated SG&A expenses were $27,122 in Q2 2024, down from $29,226 in Q2 2023, mainly due to reduced compensation and outside services costs[101] - Selling and distribution expenses decreased by $802 for the six months ended June 30, 2024, primarily due to lower compensation and marketing costs[126] Strategic Initiatives - The company reported a strategic review expense of $2,020,000 in Q2 2024, which was not present in Q2 2023[8] - Strategic review expenses amounted to $4,189 for the six months ended June 30, 2024, related to a review of strategic alternatives for business segments[126] - DMC expects Arcadia Products to drive future growth, leveraging new digital technologies and increased manufacturing capacity[103] Market Conditions - The company’s expected loss rate reflects uncertainties in market conditions, including supply chain disruptions and rising interest rates[23] - The company is currently evaluating the impact of recent accounting standards updates on its financial statements and disclosures, which may affect future reporting[51][52] Shareholder Information - The Stockholder Protection Rights Agreement was adopted on June 5, 2024, allowing shareholders to purchase shares at $75.00 if certain conditions are met[68] - The company suspended its quarterly dividend indefinitely as of April 23, 2020, with future dividends subject to Board discretion[173]

Exhibit 99.1 FOR IMMEDIATE RELEASE: CONTACT: Geoff High, Vice President of Investor Relations 303-604-3924 DMC GLOBAL REPORTS SECOND QUARTER FINANCIAL RESULTS • Second quarter sales were $171.2 million, up 3% sequentially and down 9% vs. Q2 2023 • Net income was $6.3 million, while net income attributable to DMC was $4.0 million • Adjusted net income attributable to DMC* was $5.7 million, or $0.29 per diluted share • Adjusted EBITDA* attributable to DMC was $19.4 million, up 16% sequentially and down 39% vs ...

Core Insights - DMC Global Inc. has appointed Simon Bates as an independent director, bringing nearly 30 years of leadership experience in the building products industry [4][5] - The appointment fulfills a requirement from a cooperation agreement with Bradley L. Radoff and his affiliate to add a director with relevant expertise [2] Company Overview - DMC Global operates innovative, asset-light manufacturing businesses that provide unique, highly engineered products and differentiated solutions [7] - The company consists of several businesses, including Arcadia, DynaEnergetics, and NobelClad, which have established leadership positions in their respective markets [7] - DMC is based in Broomfield, Colorado, and trades on Nasdaq under the symbol "BOOM" [7] Leadership Experience - Simon Bates previously served as CEO of Argos North America and president, CEO, and director of GCP Applied Technologies Inc., both significant players in the building products sector [1] - Bates has also held leadership roles at CRH plc, enhancing his expertise in the industry [1] Board Composition - With the addition of Simon Bates, the DMC board now consists of eight directors [5] - Bates will serve on the Corporate Governance and Nominating Committee and the Compensation Committee [5] Educational Background - Simon Bates holds a bachelor's degree in economics from the University of York and postgraduate degrees in accounting, finance, and marketing from various UK universities [6]

To simplify its portfolio and focus more on the Arcadia Products business, DMC Global's board initiated a review of strategic alternatives for the DynaEnergetics and NobelClad segments in the first quarter of 2024. The board has been supervising the assessment process, which includes sale options, a merger or other business combinations involving one or both businesses. However, no definitive timeline has been set for the conclusion of the process and the company stated that it might not even materialize in ...

BROOMFIELD, Colo., June 14, 2024 (GLOBE NEWSWIRE) -- DMC Global Inc. (NASDAQ:BOOM) ("DMC" or the "Company") today commented on Steel Connect's recent unsolicited proposal (the "Proposal"). DMC's board of directors (the "Board") previously announced a review of strategic alternatives. The Board will consider the Proposal as part of its ongoing deliberations, in consultation with its legal and financial advisors and in accordance with its fiduciary duties. In the meantime, stockholders need not take any actio ...

BROOMFIELD, Colo., June 06, 2024 (GLOBE NEWSWIRE) -- DMC Global Inc. (NASDAQ:BOOM) today announced its board of directors (the "Board") has unanimously adopted a limited-duration Stockholder Protection Rights Agreement (the "Rights Plan") to protect stockholder interests. The Rights Plan is intended to enable stockholders to realize the full value of their investment in DMC Global while reducing the likelihood that any entity, person or group gains control of the Company through openmarket accumulation with ...