NEWS RELEASE CONTACT: Kent Yee Senior Vice President, CFO 713-996-4700 www.dxpe.com DXP ENTERPRISES, INC. REPORTS THIRD QUARTER 2024 RESULTS • $35.0 million in cash • $472.9 million in sales, a 6.1 percent sequential and 12.8 percent year-over-year increase • GAAP diluted EPS of $1.27 • $52.4 million in earnings before interest, taxes, depreciation & amortization and other non-cash charges ("Adjusted EBITDA") • Free Cash Flow of $24.4 million for the quarter, and $54.4 million for the nine months ended Sept ...

Financial Data and Key Metrics - Total sales for Q3 2024 increased by 12.8% year-over-year to $472.9 million, with adjusted EBITDA of $52.4 million, up 19.1% year-over-year [8][19] - Year-to-date sales through September 30 increased by 4.7%, with adjusted EBITDA up 6.5% [7] - Gross profit margins improved by 94 basis points to 30.9% in Q3 2024 compared to Q3 2023 [17] - Operating income margin was 8.4% in Q3 2024, a slight decline of 18 basis points compared to Q3 2023 [18] - Earnings per diluted share for Q3 2024 was $1.27, up from $0.93 in Q3 2023 [37] Business Segment Performance - **Innovative Pumping Solutions (IPS):** Sales grew 52.3% year-over-year to $89.8 million, driven by strong performance in energy and water-related projects [8][9] - **Service Centers:** Sales increased 7.6% year-over-year to $316.8 million, with operating income margins of 14.6% [8][19] - **Supply Chain Services (SCS):** Sales grew 0.7% year-over-year to $66.2 million, with operating income margins of 8.4% [8][19] - DXP Water now represents 45% of IPS sales, up from 31% in the previous year [9] Market Performance - Energy-related backlog grew 39.1% sequentially in Q3 2024, with significant project wins expected to impact revenue in Q1 or Q2 of 2025 [27] - Water and wastewater-related backlog also showed strong growth, driven by both organic and acquisition-related additions [28] - Regional growth was observed in North Central, North Texas, South Rockies, Southwest, and Canadian rotating equipment markets [13] Strategic Direction and Industry Competition - The company is focused on driving organic and acquisition growth, improving gross profit margins, and increasing productivity [6] - DXP is diversifying its business to reduce cyclicality, with a strong emphasis on water and wastewater projects, which now represent a significant portion of IPS sales [9][10] - The company has closed seven acquisitions year-to-date, with plans to close at least two more by the end of Q1 2025 [44] Management Commentary on Operating Environment and Future Outlook - Management remains optimistic about the future, citing strong demand in end markets and a robust acquisition pipeline [6][20] - The company expects to maintain double-digit EBITDA margins and continue growing sales above market rates [20][22] - DXP is investing in technology and processes to improve efficiency and support long-term growth [17] Other Important Information - The company has remediated all material weaknesses in its financial controls as of Q3 2024 [45] - DXP repurchased $5 million worth of shares in Q3 and has a new $85 million share repurchase program in place [44] - Free cash flow for Q3 was $24.4 million, down from $38.3 million in Q3 2023, primarily due to investments in project work [41] Q&A Session Summary Question: Acquisition Pipeline and Recent Deals - The company closed five acquisitions by the end of Q3 and two more in October, bringing the total to seven year-to-date [47] - Two additional acquisitions are expected to close by the end of Q1 2025 [47] - Recent acquisitions include a water wastewater business in Nebraska and a vacuum pump business in California [48] Question: Q4 Revenue Expectations - Management expects Q4 revenue to be softer historically, with fewer billing days due to holidays [51] - Sales per business day trend shows variability, with September reaching $8.77 million per day, but October dropping to $6.99 million per day [50] Question: EBITDA Margins and Operating Tailwinds - Adjusted EBITDA margins are expected to remain in the double digits, supported by growth in water and wastewater projects and accretive acquisitions [55] - SG&A expenses are expected to remain elevated as the company invests in growth initiatives [55] Question: Debt Refinancing and Interest Expense - The company reduced borrowing costs by 100 basis points in October, with run-rate interest expense expected to remain around $15.5 million to $16 million per quarter [57] Question: Portfolio Diversification and Potential Divestitures - Management is open to divesting parts of the portfolio that no longer align with the company's strategic direction, though no immediate plans are in place [60][62] Question: Capital Allocation and Seller Expectations - Seller valuations remain reasonable, and the company continues to focus on strategic acquisitions that align with its growth objectives [58]

We are in one of the busiest weeks of the current reporting cycle, and betting on stocks based on profit numbers and earnings surprises is in trend. But looking beyond profits and figuring out a company's cash position can be far more rewarding. In this regard, stocks like Limbach Holdings, Inc. (LMB) , DXP Enterprises, Inc. (DXPE) , Lands' End, Inc. (LE) and Euroseas Ltd. (ESEA) are worth buying. Even though profit is a company's goal, cash is necessary for its existence, development and success, and it is ...

In the latest market close, DXP Enterprises (DXPE) reached $49.40, with a +0.06% movement compared to the previous day. The stock's performance was behind the S&P 500's daily gain of 0.16%. Meanwhile, the Dow experienced a drop of 0.37%, and the technology-dominated Nasdaq saw an increase of 0.78%. Shares of the industrial products supplier witnessed a loss of 7.48% over the previous month, trailing the performance of the Industrial Products sector with its loss of 0.89% and the S&P 500's gain of 1.67%. The ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks. Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks. Luckily, Za ...

In the latest trading session, DXP Enterprises (DXPE) closed at $54.86, marking a +0.31% move from the previous day. This move lagged the S&P 500's daily gain of 0.77%. Elsewhere, the Dow saw an upswing of 0.47%, while the tech-heavy Nasdaq appreciated by 0.87%. The industrial products supplier's shares have seen an increase of 9.62% over the last month, surpassing the Industrial Products sector's gain of 8.52% and the S&P 500's gain of 4.87%. Investors will be eagerly watching for the performance of DXP En ...

When it comes to short-term investing or trading, they say "the trend is your friend." And there's no denying that this is the most profitable strategy. But making sure of the sustainability of a trend to profit from it is easier said than done. Often, the direction of a stock's price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it's important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate re ...

The most recent trading session ended with DXP Enterprises (DXPE) standing at $53.36, reflecting a +0.87% shift from the previouse trading day's closing. The stock exceeded the S&P 500, which registered a gain of 0.42% for the day. Elsewhere, the Dow gained 0.04%, while the tech-heavy Nasdaq added 0.38%. Shares of the industrial products supplier have depreciated by 3.82% over the course of the past month, underperforming the Industrial Products sector's gain of 6.17% and the S&P 500's gain of 2.06%. Invest ...

Here are three stocks with buy rank and strong momentum characteristics for investors to consider today, September 26th: DXP Enterprises, Inc. (DXPE) : This company that engages in distributing maintenance, repair, and operating products, equipment, and services to industrial customers has a Zacks Rank #1 and witnessed the Zacks Consensus Estimate for its current year earnings increasing 12.7% over the last 60 days. DXP's shares gained 14.5% over the last three months compared with the S&P 500's advance of ...

When it comes to short-term investing or trading, they say "the trend is your friend." And there's no denying that this is the most profitable strategy. But making sure of the sustainability of a trend to profit from it is easier said than done. Often, the direction of a stock's price movement reverses quickly after taking a position in it, making investors incur a short-term capital loss. So, it's important to ensure that there are enough factors -- such as sound fundamentals, positive earnings estimate re ...