DXP Enterprises, Inc. (NASDAQ: DXPE) is pleased to
provide shareholders with a preannouncement of DXP’s performance
for the three months ended June 30, 2021, which features growth in
sequential sales, improvement in gross margins and solid free cash
flow generation.
David R. Little, Chairman and CEO commented, “Today, based on
preliminary financial information, we are pleased to announce
sequential sales growth in all three business segments for the
second quarter of 2021. I am pleased that DXP’s performance
continues to strengthen as we accelerate into the COVID-19
recovery. Most of our customers and the markets we serve continue
to show improvement. We remain encouraged by the sequential
increases despite the continued choppiness. Thank you to all our
customers and DXPeople for the support and efforts to remain safe
and healthy while moving forward.”
Preliminary Results:
($ thousands, unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
Sales
2021
2020
2021
2020
Service Centers
$
209,458
$
153,848
$
395,856
$
336,433
Innovative Pumping Solutions
36,727
60,479
59,972
130,500
Supply Chain Services
39,331
37,074
75,304
85,451
Total DXP Sales
$
285,516
$
251,401
$
531,132
$
552,384
Other Items:
Three Months Ended June
30,
Six Months Ended June
30,
2021
2020
2021
2020
Net cash from operating activities
$
11,403
$
63,376
$
21,955
$
61,764
Less: purchases of property and
equipment
(846)
(1,898)
(1,526)
(5,133)
Plus: proceeds from sales of property and
equipment
—
123
1,297
123
Free cash flow
$
10,557
$
61,601
$
21,726
$
56,754
Kent Yee, CFO, added, “Our second quarter sequential sales
growth of 16.2 percent and $10.6 million in free cash flow was
great to see. As of June 30, 2021, we had $79.3 million in cash and
cash equivalents, despite completing two acquisitions during 2021,
four acquisitions at year-end 2020 and share repurchases completed
towards the end of the quarter.”
The preliminary results above are unaudited and are based on
management’s initial review of DXP’s financial results for the
three month period ended June 30, 2021.
Earnings Conference Call Update
DXP is currently in its quiet period ahead of its second quarter
2021 earnings call and will not host a call to provide additional
commentary regarding this preannouncement. We will now host a
conference call regarding June 30, 2021 second quarter results on
the Company’s website (www.dxpe.com) no later than Friday, August
13, 2021. The Company will provide an update, when appropriate.
Non-GAAP Financial Measures
DXP supplements reporting of net income with non-GAAP
measurement, free cash flow. This supplemental information should
not be considered in isolation or as a substitute for the unaudited
GAAP measurements.
Free Cash Flow reconciles to the most directly comparable GAAP
financial measure of cash flows from operations as provided above.
We believe Free Cash Flow is an important liquidity metric because
it measures, during a given period, the amount of cash generated
that is available to fund acquisitions, make investments, repay
debt obligations, repurchase company shares, and for certain other
activities.
About DXP Enterprises, Inc.
DXP Enterprises, Inc. is a leading products and service
distributor that adds value and total cost savings solutions to
industrial customers throughout the United States, Canada and
Dubai. DXP provides innovative pumping solutions, supply chain
services and maintenance, repair, operating and production ("MROP")
services that emphasize and utilize DXP’s vast product knowledge
and technical expertise in rotating equipment, bearings, power
transmission, metal working, industrial supplies and safety
products and services. DXP's breadth of MROP products and service
solutions allows DXP to be flexible and customer-driven, creating
competitive advantages for our customers. DXP’s business segments
include Service Centers, Innovative Pumping Solutions and Supply
Chain Services. For more information, go to www.dxpe.com.
The Private Securities Litigation Reform Act of 1995 provides a
“safe-harbor” for forward-looking statements. Certain information
included in this press release (as well as information included in
oral statements or other written statements made by or to be made
by the Company) contains statements that are forward-looking. These
forward-looking statements include without limitation those about
the Company’s expectations regarding the impact of and recovery
from the COVID-19 pandemic and the impact of low commodity prices
of oil and gas; the Company’s business, the Company’s future
profitability, cash flow, liquidity, and growth. Such
forward-looking information involves important risks and
uncertainties that could significantly affect anticipated results
in the future; and accordingly, such results may differ from those
expressed in any forward-looking statement made by or on behalf of
the Company. These risks and uncertainties include, but are not
limited to; decreases in oil and natural gas prices; decreases in
oil and natural gas industry expenditure levels, which may result
from decreased oil and natural gas prices or other factors; ability
to obtain needed capital, dependence on existing management,
leverage and debt service, domestic or global economic conditions,
economic risks related to the impact of COVID-19, ability to manage
changes and the continued health or availability of management
personnel and changes in customer preferences and attitudes. In
some cases, you can identify forward-looking statements by
terminology such as, but not limited to, “may,” “will,” “should,”
“intend,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”
“predict,” “potential,” “goal,” or “continue” or the negative of
such terms or other comparable terminology. For more information,
review the Company’s filings with the Securities and Exchange
Commission. More information on these risks and other potential
factors that could affect the Company’s business and financial
results is included in the Company’s filings with the SEC,
including in the “Risk Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” sections
of the Company’s most recently filed periodic reports on Form 10-K
and Form 10-Q and subsequent filings. The Company assumes no
obligation to update any forward-looking statements or information,
which speak as of their respective dates.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210805006190/en/
Kent Yee, (713) 996-4700 Senior Vice President, CFO
www.dxpe.com
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