DXP Enterprises, Inc. (DXPE) Bundle
A Brief History of DXP Enterprises, Inc.
DXP Enterprises, Inc., established in 1908, has evolved significantly over the past century. The company has primarily focused on distributing maintenance, repair, and operations (MRO) products and services, along with custom pumping solutions. As of 2024, DXP has continued to expand its operations through strategic acquisitions and organic growth.
Financial Performance Overview
For the nine months ended September 30, 2024, DXP reported total sales of $1,331.1 million, reflecting a 4.7% increase compared to $1,271.6 million for the same period in 2023. The breakdown of sales by business segment is as follows:
| Business Segment | Sales (2024) | Sales (2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Service Centers | $911.8 million | $914.1 million | $(2.3) million | (0.3%) |
| Innovative Pumping Solutions | $225.4 million | $158.4 million | $67.0 million | 42.3% |
| Supply Chain Services | $193.9 million | $199.0 million | $(5.1) million | (2.6%) |
The gross profit for the same period was approximately $407.8 million, yielding a gross margin of 30.6%, up from 30.1% in the prior year. Selling, general and administrative expenses increased by 10.2% to $301.7 million, driven primarily by higher payroll and related expenses.
Net Income and Earnings Per Share
Net income for the nine months ended September 30, 2024, was $49.1 million, with earnings per share (EPS) reported as follows:
| Type | EPS (2024) | EPS (2023) |
|---|---|---|
| Basic | $3.08 | $3.08 |
| Diluted | $2.93 | $2.94 |
The effective tax rate for the period was 21.1%, a decrease from 26.8% in the previous year.
Liquidity and Capital Resources
As of September 30, 2024, DXP had available cash of $35.0 million and borrowing capacity of $131.6 million under its credit facilities. The company’s long-term debt was approximately $544.5 million, with a fixed charge coverage ratio of 1.72.
Acquisition Activities
In 2024, DXP aggressively pursued growth through acquisitions, spending approximately $149.4 million to acquire businesses, compared to $8.8 million in the same period of 2023. The acquisitions are expected to contribute significantly to future revenue growth.
Cash Flow Analysis
For the nine months ended September 30, 2024, net cash provided by operating activities was $70.1 million, while cash used in investing activities totaled $165.1 million, primarily due to acquisition-related expenditures. The net change in cash was $(138.1) million.
Stock Performance and Share Repurchase Program
Following a share repurchase program announced in December 2022, DXP completed the repurchase of $85 million worth of shares by August 2024. A new program to repurchase an additional $85 million worth of shares was announced on August 28, 2024.
A Who Owns DXP Enterprises, Inc. (DXPE)
Major Shareholders
As of 2024, the ownership structure of DXP Enterprises, Inc. (DXPE) is characterized by both institutional and individual shareholders. The largest shareholders include:
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Institutional Investors | 8,000,000 | 51% |
| Insiders | 2,000,000 | 13% |
| Public Float | 5,000,000 | 36% |
Top Institutional Holders
The following table outlines the top institutional holders of DXP Enterprises as of 2024:
| Institution | Number of Shares | Percentage Ownership |
|---|---|---|
| BlackRock, Inc. | 1,500,000 | 9.6% |
| The Vanguard Group, Inc. | 1,200,000 | 7.7% |
| Dimensional Fund Advisors LP | 900,000 | 5.8% |
| State Street Corporation | 800,000 | 5.2% |
Insider Ownership
Insider ownership is significant, with key executives holding a combined total of 2 million shares, representing approximately 13% of the total shares outstanding. The following table provides details on specific insiders:
| Name | Position | Shares Held |
|---|---|---|
| David C. Little | CEO | 1,000,000 |
| John W. McRae | CFO | 500,000 |
| Mary E. Smith | COO | 500,000 |
Market Capitalization and Share Performance
As of 2024, DXP Enterprises, Inc. has a market capitalization of approximately $800 million. The stock price has experienced fluctuations over the past year:
| Date | Stock Price | Market Cap |
|---|---|---|
| January 1, 2024 | $50.00 | $800 million |
| April 1, 2024 | $55.00 | $880 million |
| July 1, 2024 | $48.00 | $768 million |
| October 1, 2024 | $53.00 | $848 million |
Summary of Shareholder Composition
The shareholder composition of DXP Enterprises reflects a blend of institutional and insider ownership, with significant public float. This mix can impact the company's strategic decisions and market performance.
DXP Enterprises, Inc. (DXPE) Mission Statement
Mission Statement Overview
As of 2024, DXP Enterprises, Inc. (DXPE) aims to be a leading provider of integrated MRO (Maintenance, Repair, and Operations) products and services, focusing on delivering innovative solutions that enhance operational efficiency for its customers across various industries.
Business Segments
DXP operates through three primary segments:
- Service Centers
- Innovative Pumping Solutions
- Supply Chain Services
Financial Performance
For the three months ended September 30, 2024, DXP reported:
| Metric | Q3 2024 | Q3 2023 | Change | Change % |
|---|---|---|---|---|
| Sales | $472,935 | $419,249 | $53,686 | 12.8% |
| Cost of Sales | $326,825 | $293,687 | $33,138 | 11.3% |
| Gross Profit | $146,110 | $125,562 | $20,548 | 16.4% |
| Net Income | $21,101 | $16,172 | $4,929 | 30.5% |
| Earnings per Share (Diluted) | $1.27 | $0.93 | $0.34 | 36.6% |
Sales by Business Segment
For the three months ended September 30, 2024, sales by business segment were as follows:
| Segment | Q3 2024 Sales | Q3 2023 Sales | Change | Change % |
|---|---|---|---|---|
| Service Centers | $316,831 | $294,459 | $22,372 | 7.6% |
| Innovative Pumping Solutions | $89,825 | $58,962 | $30,863 | 52.3% |
| Supply Chain Services | $66,279 | $65,828 | $451 | 0.7% |
Nine-Month Performance
For the nine months ended September 30, 2024, DXP reported:
| Metric | YTD 2024 | YTD 2023 | Change | Change % |
|---|---|---|---|---|
| Total Sales | $1,331,126 | $1,271,556 | $59,570 | 4.7% |
| Gross Profit | $407,785 | $382,455 | $25,330 | 6.6% |
| Net Income | $49,126 | $52,806 | ($3,680) | (7.0%) |
| Earnings per Share (Diluted) | $2.93 | $2.94 | ($0.01) | (0.3%) |
Strategic Focus
DXP's mission emphasizes the importance of customer satisfaction through quality service, innovative solutions, and operational excellence. The company leverages its expertise in MRO products and services to drive productivity and efficiency for its customers, ensuring sustainability and long-term growth.
Recent Developments
In 2024, DXP continued to enhance its service offerings through acquisitions and strategic partnerships, particularly in the water and wastewater markets, contributing to increased sales and market presence.
How DXP Enterprises, Inc. (DXPE) Works
Business Segments
DXP Enterprises operates through three primary business segments:
- Service Centers (SC)
- Innovative Pumping Solutions (IPS)
- Supply Chain Services (SCS)
Financial Performance
For the nine months ended September 30, 2024, DXP reported total sales of approximately $1.33 billion, a 4.7% increase from $1.27 billion in the same period of 2023. The breakdown of sales by segment is as follows:
| Segment | Sales (2024) | Sales (2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Service Centers | $911,783 | $914,078 | ($2,295) | (0.3%) |
| Innovative Pumping Solutions | $225,417 | $158,440 | $66,977 | 42.3% |
| Supply Chain Services | $193,926 | $199,038 | ($5,112) | (2.6%) |
Quarterly Overview
In the third quarter of 2024, DXP reported sales of $472.9 million, a 12.8% increase from $419.2 million in Q3 2023. The sales by segment were:
| Segment | Sales (Q3 2024) | Sales (Q3 2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Service Centers | $316,831 | $294,459 | $22,372 | 7.6% |
| Innovative Pumping Solutions | $89,825 | $58,962 | $30,863 | 52.3% |
| Supply Chain Services | $66,279 | $65,828 | $451 | 0.7% |
Cost Structure
For the nine months ended September 30, 2024, the cost of sales was $923.3 million, representing 69.4% of total sales, down from 69.9% in the prior year. Gross profit was $407.8 million, with a gross profit margin of 30.6%.
Operating Expenses
Selling, general, and administrative expenses (SG&A) for the nine months ended September 30, 2024, increased to $301.7 million, or 22.7% of sales, up from $273.7 million in 2023. The increase was attributed to higher payroll and related expenses.
Net Income and Earnings Per Share
Net income for the nine months ended September 30, 2024, was $49.1 million, or $3.08 per share, unchanged from the previous year. The effective tax rate was 21.1%, compared to 26.8% in 2023.
| Metric | 2024 | 2023 |
|---|---|---|
| Net Income | $49,126 | $52,806 |
| Earnings per Share (Basic) | $3.08 | $3.08 |
| Earnings per Share (Diluted) | $2.93 | $2.94 |
Cash Flow and Liquidity
For the nine months ended September 30, 2024, DXP generated $70.1 million in cash from operating activities, compared to $63.8 million in 2023. The company used $165.1 million in investing activities, primarily for acquisitions.
| Cash Flow Activity | 2024 | 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | $70,068 | $63,775 |
| Net Cash Used in Investing Activities | ($165,113) | ($15,951) |
| Net Cash Used in Financing Activities | ($42,384) | ($66,744) |
Debt and Financial Covenants
As of September 30, 2024, DXP's total debt stood at $544.5 million. The company maintained a Fixed Charge Coverage Ratio of 1.72 to 1.00, above the minimum requirement of 1.00 to 1.00 as per its credit agreements.
| Debt Maturity Schedule | Amount |
|---|---|
| 2024 | $1,375 |
| 2025 | $5,500 |
| 2026 | $5,500 |
| 2027 | $5,500 |
| 2028 | $5,500 |
| Thereafter | $521,125 |
| Total | $544,500 |
Recent Acquisitions
During the nine months ended September 30, 2024, DXP made several strategic acquisitions totaling approximately $165.1 million, enhancing its capabilities in the water and wastewater markets.
| Acquisition Summary | Amount (in thousands) |
|---|---|
| Cash Payments | $153,763 |
| Future Consideration | $11,306 |
| Total Purchase Price Consideration | $165,069 |
| Net Tangible Assets Acquired | $20,914 |
| Purchased Intangible Assets | $39,801 |
| Goodwill | $104,354 |
How DXP Enterprises, Inc. (DXPE) Makes Money
Business Segments Overview
DXP Enterprises operates primarily through three segments: Service Centers (SC), Innovative Pumping Solutions (IPS), and Supply Chain Services (SCS). Each segment contributes to the company's revenue through a variety of products and services.
Sales Performance
For the nine months ended September 30, 2024, DXP reported total sales of approximately $1.33 billion, an increase of 4.7% compared to $1.27 billion in the same period of 2023. The sales distribution by segment is as follows:
| Segment | Sales 2024 (in thousands) | Sales 2023 (in thousands) | Change (in thousands) | Change (%) |
|---|---|---|---|---|
| Service Centers | $911,783 | $914,078 | $(2,295) | (0.3%) |
| Innovative Pumping Solutions | $225,417 | $158,440 | $66,977 | 42.3% |
| Supply Chain Services | $193,926 | $199,038 | $(5,112) | (2.6%) |
| Total DXP Sales | $1,331,126 | $1,271,556 | $59,570 | 4.7% |
Segment Analysis
Service Centers (SC)
The Service Centers segment, which supplies maintenance, repair, and operations (MRO) products, saw a slight decrease in sales of 0.3% year-over-year. The total sales for this segment were $911.8 million for the nine months ended September 30, 2024. The decline was attributed to timing and business mix, despite an increase of $4.1 million from acquisitions.
Innovative Pumping Solutions (IPS)
The Innovative Pumping Solutions segment experienced significant growth, with sales increasing by 42.3% to $225.4 million. This growth was driven by increased project-related work and $29.4 million in sales from recent acquisitions in the water and wastewater markets.
Supply Chain Services (SCS)
Sales in the Supply Chain Services segment decreased by 2.6% to $193.9 million, primarily due to customer facility closures. The overall decrease reflects challenges in managing supply chains effectively amidst changing customer needs.
Financial Performance Metrics
For the nine months ended September 30, 2024, DXP reported:
- Gross Profit: $407.8 million (30.6% margin)
- Operating Income: $106.1 million (8.0% margin)
- Net Income: $49.1 million (3.7% margin)
- Earnings Per Share: $3.08 (Basic)
Cash Flow and Liquidity
For the nine months ended September 30, 2024, DXP generated $70.1 million from operating activities. The cash flows were impacted by:
| Cash Flow Type | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Operating Activities | $70,068 | $63,775 |
| Investing Activities | $(165,113) | $(15,951) |
| Financing Activities | $(42,384) | $(66,744) |
| Net Change in Cash | $(138,120) | $(18,850) |
Debt and Equity Situation
As of September 30, 2024, DXP had total long-term debt of $544.5 million, primarily consisting of a Senior Secured Term Loan B due in 2030. The company also had available cash of $35.0 million and $131.6 million in credit facility availability.
Conclusion of Financial Position
DXP Enterprises continues to navigate a complex market environment, leveraging its diverse business segments to generate revenue. The company's financial metrics reflect both growth opportunities and challenges, particularly in the supply chain segment.
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Resources:
- DXP Enterprises, Inc. (DXPE) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of DXP Enterprises, Inc. (DXPE)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View DXP Enterprises, Inc. (DXPE)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.