DXP 1Q Sales Dip YoY, Bump Up Sequentially - Modern Distribution Management

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DXP 1Q Sales Dip YoY, Bump Up Sequentially

Gross margin had a modest annual improvement, while EBITDA shrunk.
DXP Enterprises 2

Houston-based pumps, pumping equipment and industrial supplies distributor DXP Enterprises reported its 2024 first quarter financial results on May 8, showing a modest annual sales decrease and sequential increase.

The company posted 1Q total sales of $413 million, down 2.7% year-over-year and up 1.4% from 4Q23. Gross margin of 30.0% was up 50 basis points year-over-year.

By DXP business segment during 1Q24:

  • Service Centers sales of $288 million were down 5.7% year-over-year, with a 14.0% operating margin
  • Innovative Pumping Solutions sales of $62 million jumped 21.0% year-over-year, with an 11.2% operating margin
  • Supply Chain Services sales of $62 million were down 7.5% year-over-year, with an 8.5% operating margin

DXP’s 1Q operating profit of $29 million trailed the $35 million of a year earlier, while net profit of $11 million likewise trailed the $18 million of a year earlier. Adjusted EBITDA of $40 million on 9.8% margin trailed the $43 million and 10.2% of a year earlier.

“Our first quarter results reflect sequential sales growth driven by acquisitions, strong free cash flow, and continued efforts to expand and grow our business,” DXP Chief Executive David Little said in the company’s financial release. “We are encouraged by the sequential increases and the start to the year. As we look ahead to the rest of 2024, we remain optimistic around market conditions, our ability to execute our growth initiatives and the diversity of our end markets to deliver growth in 2024.”

During the quarter, DXP completed its previously announced acquisitions of Hennesy Mechanical Sales, Kappe Associates, and Pro-Seal, Inc.

DXP had 2023 total sales of $1.68 billion.

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