Houston-based pumps, pumping equipment and industrial supplies distributor DXP Enterprises reported its 2023 fourth quarter and full-year financial results on March 7, showing a double-digit annual sales gain despite a flat October-December period.

Fourth Quarter

For 4Q23, DXP posted total sales of $407 million, up narrowly from the $406 million of a year earlier. Operating profit of $51 million topped the $44 million of a year earlier. Adjusted EBITDA of $42 million topped the $32 million of a year earlier, with margin jumping 250 basis points to 10.3%. 

By business segment during 4Q:

• Service Centers sales of $257 million (63.1% of total) fell 8.0% year-over-year, while operating profit of $34 million increased 5.6%.
• Innovative Pumping Solutions sales of $89 million (21.9% of total) jumped 45.0% year-over-year, while operating profit of $13 million doubled the $6.8 million of a year earlier.
• Supply Chain Services sales of $61 million (15.0% of total) fell 6.7% year-over-year, while operating profit of $5 million fell 4.5%.

Full-Year

For all of 2023, DXP totaled annual revenue of $1.68 billion, up 13.4% vs. 2022. DXP closed three acquisitions during the year — Florida Valve, Riordan, and Alliance Pump & Mechanical — and noted that acquisitions contributed $33 million to its 2023 sales, or 2.0%.

2023 gross margin of 30.1% jumped 160 basis points vs. 2022.

The company’s 2023 operating profit of $139 million jumped 41.9%, and net profit of $69 million likewise increased 43.0%.

Adjusted EBITDA of $174 million in 2023 was far above the $127 million in 2022, with margin improving 180 bps.

“Fiscal 2023 financial performance reflects the execution of our end market diversification efforts, our plans to grow both organically and through acquisitions, and continuous improvement in our operations and efficiency,” DXP CFO Kent Yee said in the company’s financial report.

Other Notes

DXP has already announced three completed acquisitions in 2024: Hennesy Mechanical Sales, Kappe Associates and Pro-Seal.

In October 2023, DXP announced the closing on refinancing of existing Senior Secured Term Loan B borrowings and the raising of an incremental $125 million in TLB borrowings, which the company said will fund reinvestment in the business and acquisitions.

DXP was No. 22 on MDM’s 2023 Top Industrial Distributors List.