Greetings, and welcome to the Distribution Solutions Third Quarter 2024 Earnings Conference Call. At this time, all participants are on a listen-only mode, and a question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Mr. Steven Hooser, with Investor Relations. Sir, the floor is yours. Good morning, everyone, and welcome to the Distribution Solutions Group Q3 2024 earnings call. Joining me on today's call are DSG's Chairman and Chief Executive Officer, Bryan King, and Executive Vice President and Chief Financial Officer, Ron Knutson. In conjunction with today's call, we have provided a financial results slide deck posted on the company's IR website at investor.distributionsolutionsgroup.com. Please note that statements on this call and in today's press release contain forward-looking statements concerning goals, beliefs, expectations, strategies, plans, future operating results, and underlying assumptions are subject to risks and uncertainties that could cause actual results to differ materially from those described. In addition, statements made during this call are based on the company's views as of today. The company anticipates that future developments may cause those views to change, and we may elect to update the forward-looking statements made today but disclaim any obligation to do so. Management will also refer to non-GAAP measures, and reconciliations to the nearest GAAP measures can be found at the end of the earnings release. The earnings release issued earlier today was posted on the Investor Relations section of our website. A copy of the release is also included in the current report on Form 8-K filed with the SEC. Lastly, this call is being webcast and on the internet via the Distribution Solutions Group Investor page on the company's website. A replay of this teleconference will be available through November 14, 2024. Now, I'd like to turn the call over to Bryan King. Bryan. Thanks, Steven, and good morning, everyone. Thank you all for joining us today. We plan to share a brief overview of the quarter's results with an update on our initiatives before opening the line for questions. Starting on slide four, we again reported record quarterly sales, up 6.6% compared to last year's third quarter. Although organic sales were down 2.1% this quarter, what stood out this quarter was the excellent traction we are seeing at Gexpro Services that includes new customer wins and the sequential progression that continued in certain end markets, including renewables, technology, and aerospace and defense. More broadly, we saw a continued lackluster industrial backdrop. However, our commitment to our shareholders is to focus on what is in our control, and in that regard, we are making solid progress. At Lawson, after a year of adding sales tools, reimagining our sales territories and processes, and implementing focused insights for customer engagements as we dig into our transactional data, we are excited to be in a position to begin adding to our sales rep count following a period of critical investments, new processes, and reconfiguration of our sales strategies that we believe will continue to allow our reps to operate at a higher level of productivity and, importantly, allow us to recruit and retain new reps into significantly more productive territories and provide them with better tools for success. We also confirmed, as part of this process, an additional 130 new sales territories. We've made good progress on integrations across DSG, most notably on TestEquity, Hisco, where we have captured more cost savings than we underwrote and are seeing the cross-selling wins we had anticipated with Hisco's OEM offering getting pulled into TestEquity and Gexpro Services' legacy customers. This industrial technology-focused vertical has made tremendous strides integrating all its acquisitions, and while it has faced a tough marketplace backdrop between excess test and measurement inventory in the channel and weak electronics manufacturing, the channel concerns have largely been cleaned up, and the vertical is enjoying stable activity even while broader industrial activity remains weak with a growing book-to-bill. We need to see the key end markets that have been soft, like electronics manufacturing, to spool back up to be able to demonstrate the earnings leverage that we've built into this vertical. Finally, the quarter highlights include announcing three acquisitions that went through a rigorous capital allocation process where each offered a unique value proposition to customers and the DSG platform and reflect a disciplined but programmatic and active capital acquisition strategy that is hitting stride while accomplishing defined objectives at attractive valuations. Despite an active hurricane season, DSG's consolidated organic sales improved slightly, up 0.2% in the third quarter compared to the second quarter and closer to 1% if you weigh in the ADS of the three verticals. We also have begun to lap easier sales comps from a year ago, which should be a positive as we end the year and begin 2025 despite seasonally slower months ahead. We generated third quarter consolidated adjusted EBITDA of $49.1 million, or 10.5%, which is an improvement over last year's third quarter of 10% and sequentially over the second quarter of 10.3% of sales. We are committed to carefully manage our costs to create better operating leverage. We're taking a disciplined approach, but it is a journey where we do not control the end markets, to optimize DSG's cost structure and sales processes with a line of sight around driving structurally higher margins and returns on invested capital. As I've said before, we are committed to building a better and more valuable business for all our partners, and appreciate that the progression will not be linear, and the challenging market backdrop of last year and longer in test and measurement equipment. That said, we have a committed and aligned team with a mandate to scour for levers to unlock incremental profitability and operational efficiencies while thoughtfully challenging each other around what is the best way to serve customers going forward. Our internal mandate is to unlock incremental profitability and operational efficiencies. This discipline unlocks cash flows and identifies areas to reinvest those cash flows into higher-return organic and inorganic opportunities that the collective shareholder-focused team embraces with an emphasis on monitoring leverage and strengthening our balance sheet as we continue to add key capabilities and services to our platform with a commitment to make DSG a structurally better partner long-term for our customers and customer-facing colleagues, as well as a better long-term compounder for our shareholders. We have underscored to shareholders the ongoing comprehensive deep dive by our DSG management teams with strong support from the LKCM Headwater team and external resources where we are looking to improve our long-term customer intimacy proposition and measure key profitability and return metrics and levers to drive them sustainably higher over time within each of our verticals. Our process is to rigorously evaluate opportunities for investment and then prioritize capital allocation to the best and highest returns on initiatives and acquisitions that drive accomplishing our long-term goals. We've maintained a healthy and active pipeline of acquisitions through the first nine months of 2024, with strategic acquisition opportunities being executed for each vertical. I'll now walk through the strategic rationale for the three most recent acquisitions and then cover other initiatives within each of the verticals afterwards. In August, we closed on our Source Atlantic acquisition, which generates significant scale and geographic expansion in Canada to improve our strategic North American footprint. As we discussed last quarter, Source Atlantic takes our Canadian business from a regional MRO player to a national MRO player in the country. The combined platform will have a breadth of leading positions in fasteners, safety supplies, and other specialty services, an offering that each business alone lacked. Our team has spent more time with a broader set of the Source Atlantic employees, which has increased our excitement about the talent, capabilities, growth culture, and operational discipline the Source Atlantic team is bringing to DSG. Not every acquisition can bring the rich heritage and thoughtful stewardship of a business like Source Atlantic does, where it has roots in Eastern Canada that go back to 1867. As Ron will explain further in a moment, the Canadian branch division is a new reportable segment that I felt like allows better visibility to our shareholders than having it integrated into our Lawson MRO platform, allowing us all to track and follow the growth of this Canadian business. Source Atlantic brings CAD 250 million, or approximately $180 million of annual revenue, 600 colleagues, and thousands of new customers to DSG. Enhancing our opportunity to serve our existing MRO customers and employees under both Bolt Supply and Lawson Canada were important underwriting elements in our decision to pursue this acquisition, as well as how to improve our strategic and revenue growth lens in Canada across DSG's three verticals. Our goal is to leverage the combined Source Atlantic Bolt-enhanced position in the Canadian market to improve growth in what we broadly see as a ripe and growing Canadian marketplace for our collective DSG offerings. Next, we recently announced our acquisition of ConRes Test Equipment, a carve-out from Continental Resources Incorporated. ConRes scored very high as an accretive use of capital across our priorities. Our analysis of TestEquity's value-added capabilities in its test and measurement lines of business brought to light significant opportunities to prioritize areas that bring more customer intimacy and value-added support to our customers with improvement desired in several key geographies, most notably the Northeast. The addition of a Northeast calibration laboratory and ConRes's employees offer DSG added sales and support in key growth markets in the Northeast where many of our global customers have a presence. We believe that an accretive acquisition like ConRes allows us to accelerate historical asset utilization rates, resulting in an appreciable improvement opportunity on our return on invested capital for our specialty lines of business like rental, use, and calibration. We also believe in the direction adding ConRes takes our test and measurement line of business and engaging a more holistic long-term lens to support our customers, customer-facing associates, and key vendors. ConRes reflects a transaction similar to terms in how we would assign value to purchasing a large fleet of used test and measurement equipment to place in inventory at what we believe is a point in time where the current market environment to grow our rental and used fleet is depressed. This allows for real upside as we did not have to ascribe value to the calibration lab, which was critical to our underwriting decision as it adds a third DSG lab in a key geography to an asset base and strategy where we are focused on unlocking additional value through more value-added services. We believe shareholders will benefit or will enjoy the benefits of immediately folding in cash flows and expanding engagement through established relationships with excellent customers. We already serve many of ConRes' top-tier national customers in other parts of the country. This tuck-in acquisition brings on day one about $12 million in annual revenues that we should be able to immediately enhance while executing towards improved asset utilization, driving our returns and margins higher. We also recently announced our Tech Component Resources, or TCR, acquisition. Although smaller than the other two businesses discussed today, this one is highly strategic to our Gexpro Services business as it provides an important beachhead operation in what is being called the global semiconductor supply chain hub in Southeast Asia as a distributor of fasteners, mechanical components, and other industrial products serving key existing OEM customers of Gexpro Services and now TCR. With its headquarters in Singapore and a second location in Malaysia, this business provides us with an expanded geographic footprint and an ability to pull through our best-in-class offering around products and service capabilities to best serve the expansion efforts of existing global customers. This gives our customers better access to Gexpro Services, which is a trusted partner for OEM Class C parts in a growing critical marketplace. Expanding DSG's market potential with a critical geographic footprint for products and service offerings in these regions of the world extends opportunities in key end markets including technology, semiconductor, industrial, and manufacturing. We know that Gexpro Services is well-positioned to expand TCR's products and service capabilities for a broader and more diversified selection of offerings, creating a superior customer value proposition. This small acquisition also fits well into our long-term customer strategy while enhancing our key profitability and return metric objectives for Gexpro Services, and we believe was an excellent allocation of a modest amount of capital for what it is accomplishing for existing customers and the value it will unlock. Let's turn to slide five, and I will provide updates on initiatives under our three business platforms and discuss our outlook in a few moments. Lawson. Lawson's MRO-focused vertical now includes the Canadian operating unit that we expanded significantly with Source Atlantic that we mentioned earlier. Under Cesar's leadership, we will manage and report the Bolt and Source Atlantic financial results separately from Lawson's business. We believe this provides important visibility for management as well as for investors to track and monitor our Canadian MRO growth strategy, and it is consistent with how we, as your partners, will manage and measure its accomplishments. Our MRO-focused vertical now represents 38% of DSG's consolidated revenues on a trailing 12-month basis, which includes all of Lawson's acquisitions to date. On the organic side, we continue to invest in our sales force transformation with a goal of 900 sales reps by year-end and a line of sight around 1,000 reps midway through next year. We also have identified, through our sales territory realignment and our rollout of new technology-enhanced sales tools and data insights, 134 new sales territories that we did not previously have identified. Our team's efforts have validated that new greenfield territories are about twice what they had been scoped at in previous periods. Our rep count increased by 22 in the third quarter. While still early, our territory remapping of reps through Lawson's new CRM is making excellent progress. We also understand that adding new reps requires an investment as they ramp up, even when offered a highly targeted book of business. Our commitment to our sales force is genuine, and as we are loading them with tools and support resources and actively incentivizing production and monitoring progress, we want the sales force to be motivated to earn more than Lawson outside sellers earned in the past. We needed these tools and measures to be in place to demonstrate to our sellers and those we are actively recruiting that we are in a different chapter of this business, a modern and growth chapter. We continue to train all reps in the development and engagement process with the goal of more consistent and even order flows for our customers. Getting the right people and technology synchronized on top of our territory optimization strategy is an investment that we understood when we started it with the recruitment of Cesar, and no one is more impatient about and more committed to this initiative than me. It takes time and discipline execution to produce the results we desire. For Lawson, I have believed wholeheartedly in it for a decade as the most important initiative for the shareholders, sellers, and customers of Lawson. Some of the technology tools and insights have taken longer to roll out than we wanted, and we have been slower to start backfilling and growing our sales force than we should have been, but we have made tremendous strides with great insights, ever-improving accountability, and are back in an investment growth mode around feet on the street, which we know in a VMI-centric business is paramount to growing customer engagement and revenues. We also added the three key acquisitions that addressed areas of opportunity to drive improved margins and returns across our MRO offering this year. We already discussed Source Atlantic, and we continue to tackle operational and selling initiatives on Emergent Safety Supply (ESS), with product brand extension strategies for Lawson in the safety category. We are extremely encouraged with how our S&S Automotive acquisition is already expanding our Kent Automotive division's product offering and presence both in the auto collision repair market and now opening more opportunities with auto dealerships. These category and brand expansion initiatives deliver growth, better margins, and an ability to scale into new markets and customers. S&S has an extremely profitable operating model and is helping inform our Kent Automotive division, which has enjoyed significant organic growth momentum on how to drive profitability to levels not previously contemplated. At Gexpro Services, we continue to see a resurgence of business in four key verticals: technology, renewables, transportation, and aerospace and defense. These end markets are now demonstrating year-over-year and strong sequential growth, which is encouraging. It is still early days, but project business also appears to be coming back, and we are staying diligent with tightly managing costs on a growing sales base. We are aligning resources to stay ahead of business acceleration in certain verticals, especially technology. In Gexpro Services, we are expanding our leadership team to drive the commercial efforts to expand and deepen our customer relationships while attracting new business. The growth in sales and managing our costs has resulted in strong net margin expansion in 2024. Our 2021 and 2022 acquisitions, which collectively had great 2022s, are now more integrated and present a stronger Gexpro Services total value-added proposition to customers. As a whole, they had a tough profitability year in 2023 as we invested in them, and some of their key markets softened. As many of their end markets are firming back up, those acquisitions are starting to demonstrate their renewed earnings benefit for the Gexpro Services vertical. We continue to be very pleased with our Frontier and Resolux acquisitions as they present expanded opportunities, and we are very excited about the upside potential for TCR that we just discussed earlier. At TestEquity Group, we continue to see an uptick in our test and measurement sales as compared to late 2023 and early 2024, a positive sign of growing demand and market activity. End market strength is demonstrated through improving metrics in aerospace and defense technology and R&D, which we believe aligns with new fiscal year budgets. Our commitment to our key vendors and customers during the last 18 months of choppiness has resulted in gaining market share in key areas and unlocked some key growth opportunities as we remain committed to capitalizing on our improved value proposition instead of capabilities for our channel partners created by pulling together TestEquity, TEquip, and Hisco most notably in this vertical and how they are able to better engage with the broader DSG capabilities. On the capital equipment side of this vertical, we are seeing record bookings for two months now, which we believe foretells a commitment by our customers to invest back in their business, even as we continue to face softness in our OEM order volume per invoice across certain manufacturing markets in the U.S. and Mexico, especially with our electronic manufacturing customers. Related to Hisco, our integration actions are mostly completed. Our cost takeouts largely realized, and growth initiatives are well underway. At TestEquity, our strategic focus continues to be on expanding wallet share with customers, driving repeatable business on the consumable side, and optimizing digital selling capabilities. We believe that supply chains have normalized for our key vendors. We've grown our market share with them through persistent commitment, and our approach and platform is allowing us to expand our vendor relationships. Although business remains choppy in some areas, we are seeing the benefit of our disciplined approach and improved platform across a number of our strategic imperatives this year and are optimistic that we will see sales and margins build quickly as our end markets return. With that, I will turn it over to Ron and then come back to add some closing comments. Thank you, Bryan, and good morning, everyone. As with Bryan, I will keep my comments brief, but will highlight a few key takeaways within each of the verticals for the quarter. Turning to slide six, DSG's consolidated revenue for the quarter was $468 million. This represents an increase of $29.1 million, or 6.6%, driven by $38.1 million coming from our 2024 acquisitions. Organic sales declined by 2.1% versus a year ago, and we will provide average daily sales by operating segment in a few moments. From the second to the third quarter, total sales sequentially grew by 6.5%, again fueled by our acquisitions, while organic sales were up 0.2%. For the quarter, we generated adjusted EBITDA of $49.1 million, up 12.4% over the prior year, and up 8.7% versus the second quarter. Our adjusted EBITDA margin improved to 10.5%, up 50 basis points compared to last year's quarter, and up 20 basis points sequentially. As expected, the acquisition of Source Atlantic in the quarter depressed our net margins by approximately 20 basis points. We reported operating income of $18.9 million for the quarter, inclusive of $12 million of acquisition-related and tangible amortization expense, and $11.5 million, primarily due to non-cash stock-based compensation and non-recurring charges such as retention and acquisition-related costs and other one-time items. Adjusted operating income improved to $42.5 million, or 9.1% of sales, compared to $38 million, or 8.7% of sales, compared to the year-ago quarter, and a sequential improvement from 8.8% of sales compared to Q2. We reported GAAP-diluted income per share of $0.46 for the quarter, inclusive of a $0.40 tax benefit as required under GAAP based on the anticipated effective tax rate for the full year. This compares to a loss per share of $0.03 in the year-ago quarter. Adjusted EPS was $0.37 for the quarter, compared to $0.40 in Q2 and $0.35 a year-ago quarter. Turning to slide seven, let me now comment briefly on each of the operating segments. Starting with Lawson, sales were $118 million, and average daily sales with one more selling day versus a year-ago were up 1.4% on acquired revenue this year. Organic average daily sales were down 10% due to lower sales rep counts and certain end market and customer headwinds. In particular, federal government contributed to approximately 50% of this decline as the ordering processes are being revamped at the federal level. Net rep counts increased between Q2 and Q3, and we ended the quarter with approximately 860 field sales reps compared to 835 at the end of Q2 and approximately 900 in the year-ago quarter. While we continue to build a stronger Lawson by investing in our sales support team, we have not yet seen the benefit of these investments roll through our financial results. These efforts take time as we are making numerous changes that will benefit our sales reps and our company on a longer-term basis. Lawson reported adjusted EBITDA of $15.5 million, or 13.1% of sales, down 50 basis points from Q2. We anticipated more uncertainty and choppiness in results for Lawson based on a ramp of sales reps and uncertainty around end markets and larger customer activity. Turning to slide eight, as Bryan previewed, we added a new reporting segment that combines both Bolt Supply House, previously included in our other segment, with Source Atlantic, to report separately on our Canadian branch business supporting the MRO market. We call this new reportable segment the Canada Branch Division, which we believe adds good visibility and accountability to this somewhat different leg under our Lawson Products MRO-focused business unit. Sales for this new Canada segment were $39.1 million, including $24.7 million from the Source Atlantic acquisition mid-quarter. Excluding the acquired revenue, sales increased 6.2% from the year-ago quarter. Key operational initiatives are focused on the integration of both Bolt and Source, including optimizing the sales force, cost management, and integrating product availability. Q3 adjusted EBITDA for the Canada Branch segment was $4 million, or 10.3% of sales, consisting of 14.8% from Bolt and 7.6% from Source Atlantic. Turning to Gexpro Services on slide nine, total average daily organic sales for the quarter were up $12.9 million, or 12.5% from the year-ago quarter, and up 10.1% sequentially. As Bryan mentioned, the combination of many Gexpro Services end markets recovering, along with new customer wins, are driving the sales growth. Gexpro Services adjusted EBITDA expanded by $4.8 million to $16.4 million, or 14.1% of sales, up from 11.2% of sales a year ago and 11.9% of sales in the second quarter. Sequentially, adjusted EBITDA growth and margin expansion was due primarily to operating leverage from the sales increase on relatively flat operating costs. Operating leverage is benefiting us, and Gexpro Services is capitalizing on cross-sell acquisition synergies, kitting offerings, and digital revenue with a growing book-to-bill compared to the year-ago period. Lastly, I will turn to TestEquity Group on slide 10. Third quarter sales were $195.2 million, with daily sales declining by 7.4% due to headwinds in the electronics assembly market, or our consumables, causing softness in the electronic production supply end market. We are seeing good traction in our test and measurement and chambers business as 2024 is playing out, but overall softness in electronic production continues. TestEquity's adjusted EBITDA for the quarter was $14.4 million, or 7.4% of sales, up from 6.9% as a percent of sales in the prior year quarter. Sequentially, net margin compression is primarily the result of sales mix shifts due to lower consumable sales this quarter as OpEx remained flat as a percent of sales. Finally, on slide 11, our balance sheet is strong. We ended the quarter with approximately $498 million of net working capital and $328 million of liquidity, which includes $76 million of cash and cash equivalents and approximately $252 million under our existing credit facility. During the quarter, we expanded our credit facility by $255 million, with $200 million of that being a term loan and the remaining $55 million increasing our revolver from $200 million to $255 million. We closed on the Source Atlantic transaction in Q3, which added to our leverage profile. However, the credit facility expansion added significant flexibility and availability to support our growth initiatives. Leverage at the end of Q3 was 3.7 x, which remains inside of our goal of 3x-4x. Net capital expenditures, including rental equipment, were $4.1 million for the third quarter and $11 million year-to-date. We expect full-year CapEx to be in the range of $15 million-18 million, or approximately 1% of our revenues. We also realized trailing 12-month free cash flow conversion of approximately 90%, resulting in ROIC inclusive of all of our acquisitions of approximately 10%. We fully understand that more mature distribution assets can generate ROICs north of 20%. I'll now turn the call back over to Bryan. Thank you, Ron. With regard to the recent hurricanes, our employees and families impacted by the storms are safe, and there were no material disruptions or significant financial impacts. Customers in the affected areas were down between two and six days, mainly to power outages, which I'm certain presented a challenge for many of our DSG families as well. In fact, too often we can get wrapped up in strategy and financial metrics as we focus on driving the outcomes we expect and miss the humanity of a business like DSG. Ours is a company whose successes and operational improvements, like the many in this last quarter, are really the reflection of a lot of dedicated good people putting tremendous effort forth in the face of lots of marketplace uncertainty as their leadership, like me, continue to think through ways to evolve and improve this commercial platform to be the best it can be, with many of those new initiatives and timely accountability expectations requiring even more work from them in the next period. All of our successes happen because of all of the committed colleagues across DSG's business units, and I want to thank them from all of us who represent the shareholders. Our businesses have lapped 2023 softness and will compare against somewhat easier sales comparisons over the next several quarters. But I'm more focused on demonstrating to my fellow shareholders about all the progress made by our employees across countless initiatives in a more benign marketplace backdrop by getting back to our 2022 growth trajectory. We are not letting off the gas as we tackle more growth plans and initiatives, making strategic investments and controlling all controllable as best we can. We are carefully controlling all cash outlays, expenses, and working capital management. The U.S. Manufacturing Purchasing Managers' Index, or PMI, numbers this fall continue to track around 47. A PMI, as many of you know, below 50 may signal more contraction than expansion in the intermediate term, which we don't like, but it is the environment we are managing within. But like all shareholders in our management team, I can't wait to see this business when PMI is back in an expansionary mode. While we continue to prepare for choppiness in the demand environment for certain end markets, we are also starting to enjoy a resurgence in some of our key OEM end markets, as well as improving demand and orders and test and measurement in our chambers product categories, which we believe are all early indications of recovery for some broader key areas of our business. We also are eager for the election to be behind us soon, eliminating one more overhang to customer behavior, as we are also encouraged that the Fed's very recent monetary policy shift towards starting to loosen with rate cuts should also restore confidence in more reticent customers and some encouragement towards growth in sluggish end markets. For the many markets that are already experiencing end market recovery, we are encouraged and expect that others will return as uncertainty and macroeconomic pressures ease. Our DSG model is built on a competitive approach to capital allocation, and at the core, our fortified competitive mode is repeatedly being demonstrated and being affirmed in the marketplace, a clear differentiated value proposition for our customers by delivering deep technical knowledge, extensive service capabilities, and reliable sourcing of products while also sourcing complex and scarce products. We believe that DSG has presented with a large marketplace opportunity to continue consolidating some key capabilities, reducing complexity for our customers, and improving our sales force's ability to communicate our unique value. It is driven by a high level of fragmentation of niche product and service offerings that complement or expand our competitive position in the market while beneficially enhancing our diversification strategy across customers, suppliers, end markets, and geographies. We see a substantial addressable market across a diverse set of end markets in the MRO, OEM, and industrial technologies focus, especially distribution categories that include products and services where we have intimate experience and relationships across DSG and LKCM Headwater's resources. Our verticals, and increasingly DSG as a company, enjoy a trusted, proven track record of resiliency through business cycles that benefit from our asset-light model and tight working capital management. Distribution Solutions Group is built to generate significant free cash flow. That offers us, as aligned stewards, the flexibility to reinvest in key areas to improve our business and its return profile or to return capital shareholders. We are consumed across our team and all the resources we can wrangle, with a focus on creating an exceptional platform for vendors, customers, and employees alike, with a paramount commitment towards a discipline-prescriptive approach to unlocking significant shareholder value that collectively sets up DSG to compound returns at an elevated level for many years to come. We remain as excited and confident about our strategy and DSG's future prospects. Lastly, from a capital allocation perspective, we will continue to run an active but highly focused strategic M&A playbook, which continues to enjoy a robust pipeline of active opportunities. While we continue to lean into facilitating an efficient and disciplined integration process to hold all accountable to capture the full opportunity set around these investments we are making with shareholder capital, we will do this while making sure that all of our leaders appreciate the metrics we expect to effectuate, encouraging them to prioritize and unlock higher return projects as timely as possible, as we all appreciate how unlocking those sustain our primary objective, which is to drive elevated value creation in the near and long term at DSG. With that, Operator, let's open the line for questions. Thank you. At this time, we will be conducting our question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. If you wish to remove your question, you may press star two. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Thank you. Our first question is coming from Tommy Moll with Stephens. Your line is live. Good morning, and thank you for taking my questions. Morning, Tommy. Morning, Tommy. Bryan, I wanted to start on Gexpro. It's now three quarters in a row where there's been a sequential step-up in revenue there, although the rate of that increase improved. I think you were up double digits third quarter versus second quarter. So what can you do to unpack the shape of that recovery for us, and what, if any, visibility do you have going forward there? Thank you. Yeah. Ron, you may want to help me on this, but Tommy, the end markets that we've highlighted, the renewables and the semiconductor markets that had been real laggards last year, were an important part of we'd indicated that we thought we would see improvement in those end markets as we got in the back half of the year, and we have been seeing that. It's not yet to the level that we've enjoyed in the past, but it is significantly better than it was as we were exiting last year. Last year was a particularly tough year for renewables as well as semiconductors. We talked about those consistently in our quarterly calls last year. That impacted some of those end markets that were soft last year really did impact as we were investing in some of the acquisitions that we bought to fold into Gexpro. And we were really leaning into investments in those acquisitions versus leaning them out last year. A lot of times when you buy things, you try and pick up synergies. In our case, the synergies that we saw were on the top line and really were not in the cost structure of those companies like Frontier and Resolux that I alluded to on the call. And so we leaned into the costs or into investments in those businesses, took the cost structure up at the same time as the end market softened. So that had a kind of a double whammy last year on profitability. And now those end markets are starting to spool back up, and we're getting more performance out of those acquisitions, and we're getting the earnings leverage coming back our favor. So I don't know if that's helpful. Last year, Gexpro Services core carried the profitability and made up for some deterioration in acquisitions profitability where we'd made investments in their operating expenses and their markets had softened, and this year, we're getting some benefit on both sides, both at Gexpro Services core and then also the benefit to cross-sell or to expand our engagements with some of the customers in the marketplaces that are recovering from the help of those acquisitions. Ron, anything you can help me on there? Yeah. I think you hit it, Bryan. I mean, as we look at aerospace and defense, it has been strong over quite a few of the past quarters. The technology side, which for Q3, our low point there was really Q3 a year ago, and that technology end market for us, not quite double sales from where we were a year ago, quarter, but pretty close. So that is a really nice recovery for us. And then certainly on the renewable side, primarily wind, that segment, that end market continues to march up sequentially for the first three quarters of this year as well. So yeah, I think those are really, I would say, the three main end markets that are driving the majority of the growth. And as a follow-up, I wanted to ask this one may go to Ron just on the fourth quarter or the pacing in October. Ron, you've been active on the M&A front, and so I want to get any kind of insight you can share on organic trends versus whatever acquired revenue you would expect to book in the fourth quarter. And then similar question just on the margin side, Ron, you were in the double-digit range from a consolidated EBITDA margin standpoint for the second consecutive quarter. Any reason that that should not, again, be the case as you go into Q4? Thank you. Yeah, Tommy. So just relative to sitting here one month into the fourth quarter, I would say that our sales levels are across DSG, this is just in the aggregate, relatively consistent in terms of what we saw in the third quarter. So I would say no major movements from where we left off at the end of Q3 to where we are today. Relative to Q4 from a margin perspective, yes, fewer selling days, but we would expect that we'd still be able to perform in a double-digit margin range, even with a couple less selling days in the quarter. And that's significant for us. Every day for us, even on the organic side, is about $6.5 million or $7 million in sales. So two days takes 14 million, or actually, I think it's three days. I think it's 61 days versus 64. But we still feel like we're going to be able to get ourselves in the double-digit EBITDA range. Thank you both. I'll turn it back. Thanks, Tommy. Thanks, Tommy. Thank you. Our next question is coming from Kevin Steinke with Barrington Research. Your line is live. Thanks, Good Morning, Good morning, Kevin. Hey, Kevin. Good morning. Good morning. I wanted to just start out by asking about Lawson, and then you talked about roughly 130 new sales territories there, I believe. I think you mentioned greenfield. Are those all greenfield, or are those some kind of dividing up old territories to make them more efficient from just a routing perspective? I'm just trying to get a sense as to how much more kind of revenue opportunity you're creating with those new sales territories. Ron, I'll let you tackle it, even though I'm the enthusiastic voice here. Yeah, sure. Yeah, no problem. So you've been working on this for 10 or 20 years, but... Yeah, I know. Yeah. So... I've been on Ron on this one for a decade. So Kevin, I would really the majority of those are new territories that we feel as though we can put sales reps in and be more successful than in the past. As you're aware, we have and we continue to work on optimizing our current sales territories within our existing sales reps. And as Bryan mentioned, and I mentioned as well, we're down from a rep count perspective versus where we were a year ago, up sequentially here in the third quarter. But we are also identifying and are much more data-driven today than where we were historically around where we feel that there's opportunities that we can put a sales rep into and be much more successful right out of the gate. So even though we continue to kind of refine the territories that we have today, these are what I would really classify as more kind of new markets where we feel like we can put a rep in and get them successful right out of the gate. And to Bryan's point, and Bryan had this in his prepared remarks, I mean, we are targeting 900 reps by the end of this year. So that's still a net increase of 40 versus where we ended the quarter. And then we'll have a pretty heavy push on this for the first half of next year as well, with our goal being 1,000. And the only thing I'd add to that is that part of the scoping, the way they've been characterized to me is that they're net new from where we were more towards our peak of reps. There has been some reorganizing and some kind of trying to make the routes and the territories more efficient, as well as trying to make sure that the territories that we have available, the new hires are significantly larger in terms of scoped revenue than what we might have been hiring somebody into in years past. So it's important to us to see that the reps that we're hiring are more productive out of the gate with the tools that we've offered them, with the scoping of larger available revenue that is there for new reps. And then we've got an insight or kind of an internal team that we developed. It worked well for us on the strategic account side. It worked well for us on the military side, although military is a challenge right now with the order entry shift that the government's going through. It's impacted, I think, a lot of distributors and really is causing a mess at the military bases where they're not able to get the kits and the product in timely. But that aside, we've got a sourcing and a new business development team that will help those reps grow their street business. And so there's a lot of initiatives that we put in place to try and be much more successful with a growth lens going forward with our sellers. We rode the brake too long, in my opinion, about hiring reps and backfilling. We were trying to get our technology and our tools in place so that we could have the right offering when we recruited. But that caused our J-curve of our sales rep count to drop further than it should have. And we're all cognizant of that. And if we were going to look back over the last year and a half and look at all the progress we've made on the sales front and what we think we're going to be able to do restoring a very much more effective and efficient opportunity for sellers and growing revenues going forward on Lawson, then that would be our kind of Monday morning quarterbacking of what we wish we had done differently, which was in the face of kind of slowness out of our tech team and getting data and tools in place and reorganizing territories, all of which take a lot of time. I think we should have been hiring more aggressively even before we had all the tools that we now have in place. Okay. Fair enough. That's helpful commentary there. But you mentioned there one of the hire more aggressively, obviously. Just what does the pipeline look like there in terms of your ability to find reps? And I know it's very early days, but any initial indications of their ability to be more aggressively than historically? Yeah. Yeah. I think that we've got more tools to offer. We've got larger initial territories, and we're recruiting more deliberately in the type of reps that we're recruiting. We've got a lot of years of knowledge about trying to grow rep count and watching it be very challenging in terms of attrition. And so one of the concerns was not having the tools in place, not having the data in place, not having rescoped the open territories or the new territories that we are greenfields was to be out recruiting until we had the ability to recruit the very best candidates we could. We have a robust effort going right now, and we're confident that we will be able to add to get to 1,000 rep count number sometime mid-year next year. That's our objective, and that's what we'll be pushing to do. That'd be 135 net new reps between now and middle of next year. Kevin, just to maybe put emphasis on Bryan's point, if we look back historically, we would be hiring anywhere from kind of the high teens, maybe 20 sales reps in a month. If you look at the average monthly hires during the third quarter, it's closer to 30 on a monthly basis. We're up effectively 50% versus what historically we've hired at. We have the ability. Certainly, it's always a little challenging to find really good talent, and we continue to push on that. But we've seen a nice upward tick here in the third quarter in terms of hiring rates. Okay. That sounds good. I appreciate all the comments as usual. Got to jump to another call here, but thanks again. I'll turn it back over. Thanks, Kevin. Thanks, Kevin. Thank you. Once again, ladies and gentlemen, if you have any questions or comments, please press star one on your telephone keypad at this time. Our next question is coming from Brad Hathaway with Far View. Your line is live. Hi, guys. How are we doing? Morning, Brad. Morning. Excellent. Thanks. I appreciated the commentary on what return on invested capital looks like for a mature distribution business. And I was just wondering if kind of qualitatively you could talk a little bit about, I guess, kind of the path from where return on invested capital is today to kind of that 20% level and how you kind of think about bringing DSG in that direction. Yeah. Look, Brad, the biggest challenge on returns on invested capital, obviously, are initially when you make an acquisition and you're laying out capital and you haven't yet folded in the earnings or the earnings accretion, the synergies that you expect to get out of taking out costs or driving accelerated top-line growth as you're folding it in. So there's no doubt that our M&A activity has been absolutely weighing on our returns on invested capital the way that if you look at it, you're going to come down some as you're building your base out. And then as you build your base out, you should start seeing it improve. When you look at this as an example, the acquisitions that we've closed this year through the ConRes closed yesterday, we've paid about 8x E BITDA for those acquisitions collectively. And we would estimate that integrated over the next year or so, we'll own them at six times. And so that's kind of the first leg of trying to then drive your ROIC for that class, that 2024 class of acquisitions, driving your ROIC back up after absorbing the capital outlay and not having the benefits of the earnings where you want them to be. Last year, we had acquisitions that we made in 2022 and 2021 that had more challenging or headwinds in their end markets as we were thinning out some of or kind of integrating shared costs that are duplicative costs on Hisco with TestEquity. Now we've got those costs out, and as we look to the earnings leverage that we built into the model, we'll get a lot of updraft on the ROIC there. We've done a good job managing working capital. It's been a little bit tougher the last three months, six, five months. As we've seen a little bit of choppiness in some of our end markets, you don't have your inventories reset, and you haven't gotten your payables or, I'm sorry, your receivables pulled back down. So we expect that last year we ran it over 100% conversion. We're at 90% over the trailing 12 right now. We should get some benefits back into that because we've been running it at about 80% the last two quarters. And so that's another way that you get a little bit of it. And then the number one thing that you get is when you start getting the top line. And when we look at the cross-selling, we look at the revenue synergies of bringing some of these capabilities into our fold. We expect that we're going to get improved profitability per dollar of revenue, as well as kind of as we fold them in. And we also expect to get more benefit of being able to do a better job across our customer base to grow organically. And so we wouldn't be making acquisitions if we didn't think that they were going to drive organic revenue growth and a better value proposition for the customers. And that's what you really have to have to get to that for us to get over the 20% threshold that we expect we'll get to as we are pacing of acquisitions relative to the size of our core base is not as significant as it has been the last couple of years. I don't know if that's. Got it. That's it. You can tell me there's. Is that helpful? Yeah. Good. That is helpful. So I mean, I guess it sounds like, A, it's the maturation of the acquisitions you make because you lay out the capital ahead of time and then the earnings and whatnot improve. I mean, is there also an opportunity on the working capital side as well to kind of increase the efficiency of the balance sheet? So, Brad, we've worked hard on that efficiency. We've brought in external resources, and we have made quite a bit of progress. We've got some progress left in front of us. On the margin, that's tens of millions of dollars on your invested capital base. It's not hundreds of millions of dollars. And when you're laying out $240 million or $260 million of acquisitions in a year, then your biggest driver is going to be trying to double the EBITDA on those acquisitions. And that's where. Got it. That's what we're focused on is taking and buying $30 million of EBITDA and turning it into $60 million. And that's where. That's what we've got to do. Some of that comes from integration. Some of that comes from purchasing better. The longer tail and benefit of driving ROI, I mean, if we go back in time into the '90s and I was covering this sector back then, the Fastenal and the Grainger were more acquisitive relative to the size of their base. And then once you got to a spot where your base was pretty well set and your offering was pretty well set, then you started getting a long-tail benefit of assembling all the right capabilities and getting organic growth out of them, and you started working your way away from the original purchase price. And we've seen that model work well for us over the last two decades as we've bought distributors. And we would expect that that is exactly where we sit with DSG as we look towards the tail of continuing to compound the earnings stream out of the acquisitions that we're making. When we compound it and we grow those earnings streams, the incremental returns on invested capital are very, very high on these accretive acquisitions that we're making. The initial capital outlay is a burden. As long as they're strategic and as long as they fit into the model right, then it drives incremental returns on invested capital across the whole platform as well as the maturing and higher returns on invested capital that you'll get out of the acquisition itself. So that should drive us long-term to very much structurally higher returns on invested capital. Got it. That makes sense. Just mathematically, obviously, the denominator doesn't change much because you lay out the capital upfront and then current EBITDA is well below what you kind of believe fully synergized, fully operational future EBITDA will be. The numerator increased a lot with the denominator. Awesome. Thank you so much. I appreciate the color on that. Brad, I resynthesized and just looked at 2022's revenue levels and tried to take a more stable revenue environment for all of us and took that 2022 model and ran it back through our new cost structure and kind of our new incremental margins and where we are. And that in and of itself has a really big lift in ROIC, assuming we aren't making the next wave of acquisitions, which we will be. But that's the sort of, and then from there, in 2022, we expected that the acquisitions we were making were going to take the slope of organic revenue growth up. We've been in a more choppy set of end markets. We've been doing some tuning that's been disruptive, like on the Lawson sales force, but that's critical for unlocking a lot of growth in the future. And so as we're doing all that tuning, there's challenges and disruptions to it. But if you take that 2022 static revenue base to build off of, the earnings leverage and how that then drives the ROIC is very impactful. Got it. That's very helpful. Excellent. Thank you for the explanation. Appreciate it. Yeah. Thanks. Appreciate it, Brad. Always like the questions. Thank you. As we have no further questions in queue at this time, I would like to hand it back to Mr. King for any closing remarks. Thank you, Operator. I appreciate everybody's interest in DSG. We continue to have a lot of confidence in what we're building here for the long term, as well as in the intermediate and short. We're excited about the team we've got, the assets that we've assembled, the colleagues that we have working with us, and we appreciate your interest. On Halloween Day today, everyone stay safe and enjoy family time if you can get it, and we look forward to visiting with you in follow-up conversations for the next quarter. Thank you all so much for your time. Bye. Thank you. Ladies and gentlemen, this concludes today's conference, and you may disconnect your lines at this time, and we thank you for your participation.