DXP Enterprises Announces 2013 Second Quarter Results

DXP Enterprises Announces 2013 Second Quarter Results

HOUSTON--(BUSINESS WIRE)-- DXP Enterprises, Inc. (Nasdaq: DXPE) today announced net income of $13.7 million for the second quarter ended June 30, 2013, with diluted earnings per share of $0.90 compared to net income of $12.2 million and diluted earnings per share of $0.80 for the second quarter of 2012. Sales increased $46.0 million, or 17.6%, to approximately $307.9 million from $261.9 million for the same period in 2012. After excluding sales from acquisitions of $45.3 million, on a same store sales basis, sales for the second quarter of 2013 increased $0.7 million, or 0.3% from 2012 on a same store sales basis.

Net income for the six months ended June 30, 2013 was $27.0 million, with diluted earnings per share of $1.77 compared to net income of $23.8 million and diluted earnings per share of $1.57 for the first half of 2012. Sales for the six months ended June 30, 2013 increased $83.9 million, or 16.3%, to approximately $598.0 million from $514.2 million for the same period in 2012.


Net income for the second quarter sequentially increased 3.9% from $13.2 million to $13.7 million in the second quarter of 2013. Likewise, sales sequentially increased 6.2% from $290.1 million in the first quarter to $307.9 million in the second quarter.

David R. Little, Chairman and Chief Executive Officer, remarked, "We are pleased with our second quarter results and see positive momentum in parts of our businesses. During the quarter, we delivered organic growth consistent with our expectations outlined in the first quarter. We completed two acquisitions in the second quarter, Natpro and Tucker Tool. DXP's Service Centers, Supply Chain Services and Innovative Pumping Solutions are focused on battling for market share in today's choppy environment while not losing sight of profitability and cash flow generation.

As we look to the second half of the year, we maintain a conservative macro outlook, while remaining confident in our ability to grow organically and via acquisitions. We will continue to fund growth and initiatives that we believe will strengthen DXP's presence in North America."

Mac McConnell, Senior Vice President and CFO, added, "We are pleased to report sequential sales and earnings growth. While we experienced organic sequential growth, we were impacted by one-time acquisition costs and seasonality in Canada. Our leverage ratio under our credit facility at June 30, 2013 was a modest 1.9:1. Subsequent to the quarter end, we closed two additional acquisitions, Alaska Pump and Tool-Tech."

DXP will host a conference call to be web cast live on the Company's website (www.dxpe.com) at 5:00 P.M. Eastern time today.

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 and Sonora, Mexico. 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, 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.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: ability to obtain needed capital, dependence on existing management, leverage and debt service, domestic or global economic conditions, and changes in customer preferences and attitudes.For more information, review the Company's filings with the Securities and Exchange Commission.

DXP ENTERPRISES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME


(in thousands, except per share amounts) (unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2013

2012

2013

2012

Sales

$

307,942

$

261,894

$

598,039

$

514,181

Cost of sales

216,427

185,265

417,417

366,078

Gross profit

91,515

76,629

180,622

148,103

Selling, general and

administrative expense

68,250

55,782

134,653

107,351

Operating income

23,265

20,847

45,969

40,752

Other expense (income)

21

3

22

(12

)

Interest expense

1,689

762

3,316

1,591

Income before income taxes

21,555

20,082

42,631

39,173

Provision for income taxes

7,806

7,905

15,650

15,350

Net income

13,749

12,177

26,981

23,823

Preferred stock dividend

22

22

45

45

Net income attributable to

common shareholders

$

13,727

$

12,155

$

26,936

$

23,778

Basic earnings per share

$

0.95

$

0.84

$

1.87

$

1.66

Weighted average common

shares outstanding

14,451

14,392

14,424

14,360

Diluted earnings per share

$

0.90

$

0.80

$

1.77

$

1.57

Weighted average common shares

and common equivalent

shares outstanding

15,291

15,232

15,264

15,200

SEGMENT DATA

(in thousands)

Three Months Ended June 30,

Six Months Ended June 30,

Service

Centers

IPS

SCS

Total

Service

Centers

IPS

SCS

Total

2013

Sales

$

217,925

$

52,954

$

37,063

$

307,942

$

428,023

$

94,477

$

75,539

$

598,039

Operating income for reportable segments

$

23,376

$

8,090

$

3,160

$

34,626

$

48,420

$

15,208

$

6,347

$

69,975

2012

Sales

$

184,106

$

35,177

$

42,611

$

261,894

$

359,178

$

74,612

$

80,391

$

514,181

Operating income for reportable segments

$

22,491

$

6,939

$

3,902

$

33,332

$

41,045

$

15,187

$

6,719

$

62,951

Unaudited Reconciliation of Non-GAAP Financial Information

The following table is a reconciliation of EBITDA*, a non-GAAP financial measure, to income before income taxes, calculated and reported in accordance with U.S. GAAP (in thousands):

Three months ended

June 30,

Six months ended

June 30,

2013

2012

2013

2012

Income before income taxes

$

21,555

$

20,082

$

42,631

$

39,173

Plus interest expense

1,689

762

3,316

1,591

Plus depreciation and amortization

5,602

3,661

10,492

6,809

EBITDA*

$

28,846

$

24,505

$

56,439

$

47,573

*EBITDA - earnings before interest, taxes, depreciation and amortization



DXP Enterprises, Inc.
Mac McConnell, 713-996-4700
Senior Vice President, Finance & CFO
www.dxpe.com

KEYWORDS: United States Mexico North America Central America Texas

INDUSTRY KEYWORDS:

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