DXP reports 7.4% sales increase for fiscal '24
DXP Enterprises Inc. reported fiscal 2024 sales of $1.8 billion, up 7.4% from fiscal 2023. Fourth quarter 2024 sales rose 15.7% versus Q4-23.
Fourth quarter 2024 financial highlights:
- Sales were $470.9 million for the fourth quarter of 2024, compared to $407.0 million for the fourth quarter of 2023.
- Diluted earnings per share for the fourth quarter of 2024 was $1.29 based upon 16.5 million diluted shares, compared to $0.94 per share in the fourth quarter of 2023 based on 17.0 million diluted shares. Adjusted diluted earnings per shares was $1.38 per share compared to $1.12 per share for the fourth quarter of 2023.
- Adjusted earnings before interest, taxes, depreciation and amortization and other non-cash charges ("Adjusted EBITDA") for the fourth quarter of 2024 was $50.3 million compared to $41.9 million for the fourth quarter of 2023. Adjusted EBITDA as a percentage of sales was 10.7% and 10.3 percent, respectively.
- Free cash flow (cash flow from operating activities less capital expenditures) for the fourth quarter was $22.7 million or 46.4% of EBITDA.
Fiscal year 2024 financial highlights:
- Sales increased 7.4% to $1.8 billion, compared to $1.7 billion for fiscal 2023.
- Diluted earnings per share for 2024 was $4.22 based upon 16.7 million diluted shares, compared to $3.89 per share in 2023, based on 17.7 million basic shares. Adjusted diluted earnings per share was $4.51 per share compared to $4.09 per share in 2023.
- Net income for the year increased $1.7 million to $70.5 million, compared to $68.8 million for fiscal 2023.
- Adjusted EBITDA for 2024 was $191.3 million compared to $174.3 million for 2023. Adjusted EBITDA as a percentage of sales was 10.6% and 10.4%, respectively.
- Free cash flow for fiscal 2024 was $77.1 million or 42.3% of EBITDA compared to $94.0 million in fiscal 2023.
Business segment financial highlights:
- Service Centers’ revenue for the fiscal year was $1.2 billion, an increase of 1.9% year-over-year with a 14.3% operating income margin.
- Innovative Pumping Solutions’ revenue for the fiscal year was $323.0 million, an increase of 47.7% year over year with an 16.6% operating income margin.
- Supply Chain Services’ revenue for the fiscal year was $256.4 million, a decrease of 1.5% year-over-year with a 8.5% operating margin.
"Fiscal 2024 was another great year for DXP," said Chairman and CEO David R. Little. "DXPeople drove fourth quarter results, with strong performance or year-over-year growth across all business segments. Broad based business strength across the business helped us deliver 7.4% revenue growth on a year-over-year basis. This growth has fueled good momentum going into 2025. DXP’s Innovative Pumping Solutions sales were up 47.7% to $323.0 million, followed by Service Centers sales growing 1.9% to $1.2 billion and Supply Chain Services sales declining 1.5% to $256.4 million. Congratulations to all of our DXPeople for their hard work and efforts to serve our customers.
"The sales momentum from the fourth quarter accompanied by our backlogs continues to position us for success as we move into 2025," Little continued. "Additionally, we strengthened our balance sheet in the fourth quarter, similar to this time last year, raising a new Term Loan B which put an incremental $105 million in cash on the balance sheet. DXP’s balanced end markets, and our ability to continue to execute on acquisitions have set the stage for 2025. We see positive dynamics in our traditional end markets like oil & gas, as well as positive outlooks for end markets like water & wastewater. As a result of our strategies and our focus on managing our businesses for both the near- and long-term, we are differentiating ourselves from competitors, leveraging a broad set of assets to drive attractive returns and further advance our goals. DXP’s strategy to grow our core rotating equipment business and capabilities and expand into other highly engineered or value-added solutions for our customers, continues to deliver strong results. Over the last three years, DXP has generated an average annual return on equity of 16.5 percent and has returned approximately $118.7 million to its shareholders through share repurchases. We are confident our growth strategy, coupled with a continued focus on improving margins and maintaining operational discipline, and our evolving capital allocation model will drive shareholder value."
Kent Yee, Chief Financial Officer added, "DXP completed an outstanding fiscal 2024, with strong underlying sales growth, operating leverage, earnings per share and free cash flow generation. The DXP team delivered a strong finish to Fiscal 2024, which represents the most profitable year in our Company’s history. Fiscal 2024 financial performance continues to reflect 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. Total sales and adjusted EBITDA grew 7.4% and 9.8%, respectively.
"Our fiscal 2024 diluted earnings per share was $4.22. We are pleased with the fourth quarter, and year-end results. Once again, we positioned our balance sheet in the fourth quarter to support our growth plans in 2025. DXP ended the year with $148.4 million in cash on the balance sheet and net debt of $500.6 million. DXP’s secured leverage ratio or net debt to EBITDA was 2.4:1.0 with a covenant EBITDA of $206.2 million for fiscal 2024. We remain optimistic that DXP’s best days are ahead of us. With our strong balance sheet and broad product offering and solution, we believe DXP is unparalleled with respect to its ability to leverage these market drivers for continued growth. We expect to drive both organic and acquisition driven growth while driving shareholder and stakeholder value."
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