Earnings release
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NEWS RELEASE DXP Enterprises, Inc. Reports Third Quarter 2026 Results 2026-11-05 $218.8 million in cash $587.2 million in sales, a 14.3 percent year-over-year increase GAAP diluted EPS of $1.64 $67.3 million in earnings before interest, taxes, depreciation & amortization and other non-cash charges ("Adjusted EBITDA") Completed ve acquisitions through Q3 HOUSTON--(BUSINESS WIRE)-- DXP Enterprises, Inc. ("DXP" or the "Company") (NASDAQ: DXPE) today announced nancial results for the third quarter ended September 30, 2026. The following are results for the three months ended September 30, 2026, compared to the three months ended September 30, 2025. A reconciliation of the non-GAAP nancial measures can be found in the back of this press release. Third Quarter 2026 Financial Highlights: Sales increased 14.3 percent to $587.2 million compared to $513.7 million for the third quarter of 2025. Net income increased 24.2 percent to $26.9 million, compared to $21.6 million for the third quarter of 2025. Earnings per diluted share was $1.64 based upon 16.4 million diluted shares, compared to $1.31 earnings per diluted share in the third quarter of 2025, based on 16.5 million diluted shares. Adjusted EBITDA was $67.3 million compared to $56.5 million for the third quarter of 2025, an increase of 19.0 percent. Adjusted EBITDA as a percentage of sales, or Adjusted EBITDA margins, were 11.5 percent and 11.0 percent, respectively. Cash ow from operating activities was $18.7 million, and Free Cash Flow (cash ow from operating activities less capital expenditures) for the third quarter was $14.4 1
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million Business segment nancial highlights: Service Centers’ revenue for the third quarter was $376.6 million, an increase of 7.6 percent year-over-year, with a 14.8 percent operating income margin. Innovative Pumping Solutions’ revenue for the third quarter was $144.1 million, an increase of 43.3 percent year-over-year, with a 16.3 percent operating income margin. Supply Chain Services’ revenue for the third quarter was $66.4 million, an increase of 5.5 percent year-over- year, with a 9.0 percent operating income margin. David R. Little, Chairman and Chief Executive O cer commented, "DXP delivered a strong third quarter, with sales of $587.2 million, diluted earnings per share of $1.64, Adjusted EBITDA of $67.3 million, and free cash ow of $14.4 million. Our results re ect continued execution of our growth strategy, solid organic performance, contribution from recent acquisitions, and sustained strength in EBITDA margins. During the quarter, organic sales were $538.3 million, while acquisitions contributed $48.8 million in sales. We also saw continued strength across our business segments, with Service Centers generating $376.6 million in sales, Innovative Pumping Solutions generating $144.1 million, and Supply Chain Services generating $66.4 million. We remain focused on executing our strategic initiatives, integrating and pursuing acquisitions, generating strong cash ow, and positioning the Company for continued growth in 2027. Overall, we are proud of the progress DXP continues to make and grateful to our customers, suppliers, shareholders, and all of our DXPeople." Kent Yee, Chief Financial O cer and Senior Vice President, remarked, "Our third quarter sales and adjusted EBITDA continue to show strength and resilience as we march upwards and set a new sales high watermark. Speci cally, this quarter re ects continued execution of our strategic goals and the con dence we have in our balanced mix of business, tremendous teams, and a strong balance sheet to support our key initiatives. DXP performed well in the third quarter with $587.2 million in sales. We closed ve acquisitions through the third quarter. Total debt outstanding as of September 30, 2026, was $839.5 million. DXP’s secured leverage ratio or net debt to EBITDA ratio was 2.30:1.0 with a covenant EBITDA of $270.0 million for the last twelve months ending September 30, 2026. We expect to nish scal year 2026 strong with momentum going into scal year 2027." Conference Call Information DXP Enterprises, Inc. management will host a conference call, November 5, 2026, at 10:30 a.m. Central Time, to discuss the Company’s nancial results. The conference call may be accessed by going to https://ir.dxpe.com. Interested investors and other parties can listen to a webcast of the live conference call by logging onto the Investor Relations section of the Company's website at https://ir.dxpe.com. The online replay will be available on the same 2
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website immediately following the call. A slide presentation highlighting the Company’s results and key performance indicators will also be available on the Investor Relations section of the Company’s website. To learn more about DXP Enterprises, Inc., please visit the Company's website at https://www.dxpe.com. 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 North America. 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 exible 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. Non-GAAP Financial Measures DXP supplements reporting of net income with certain non-GAAP measurements, including EBITDA, Adjusted EBITDA, EBITDA Margin, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Net Income, and Adjusted Diluted EPS. This supplemental information should not be considered in isolation or as a substitute for the unaudited GAAP measurements. Additional information regarding EBITDA, Adjusted EBITDA, EBITDA Margin, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Net Income, Adjusted Diluted EPS, and net debt referred to in this press release are included below under "Unaudited Reconciliation of Non-GAAP Financial Information". The Company believes EBITDA provides additional information about: (i) operating performance, because it assists in comparing the operating performance of the business, as it removes the impact of non-cash depreciation and amortization expense as well as items not directly resulting from core operations such as interest expense and income taxes and (ii) the performance and the e ectiveness of operational strategies. Additionally, EBITDA performance is a component of a measure of the Company’s nancial covenants under its credit facilities. Furthermore, some investors use EBITDA as a supplemental measure to evaluate the overall operating performance of companies in the industry. Management believes that some investors’ understanding of performance is enhanced by including this non-GAAP nancial measure as a reasonable basis for comparing ongoing results of operations. By providing this non-GAAP nancial measure, together with a reconciliation to its most directly comparable GAAP nancial measure, the Company believes it is enhancing investors’ understanding of the business and results of operations, as well as assisting investors in evaluating how well the Company is executing strategic initiatives. Free Cash Flow reconciles to the most directly comparable GAAP nancial measure of 3
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cash ows from operations as provided below. 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 shares of the Company's common stock, and for certain other activities. Adjusted Net Income reconciles to the most directly comparable GAAP nancial measure of Net Income as provided below. We believe Adjusted Net Income is important because it provides the investor with further clarity around Net Income excluding the impact of unique or one-time items during the respective period. Information Related to Forward-Looking Statements 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 Company's expectations regarding the ling of the Form 10-Q; the description of the anticipated changes in the Company's consolidated balance sheet and the results of operations and the Company's assessment of the impact of such anticipated changes; the Company’s business, the Company’s future pro tability, cash ow, liquidity, and growth. Such forward-looking information involves important risks and uncertainties that could signi cantly a ect anticipated results in the future; and accordingly, such results may di er 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: the e ectiveness of management’s strategies and decisions; our ability to implement our internal growth and acquisition growth strategies; general economic and business conditions speci c to our primary customers; changes in government regulations; our ability to e ectively integrate businesses we may acquire; new or modi ed statutory or regulatory requirements; availability of materials and labor; inability to obtain or delay in obtaining government or third-party approvals and permits; non-performance by third parties of their contractual obligations; unforeseen hazards such as weather conditions, acts of war or terrorist acts and the governmental or military response thereto; cyber-attacks adversely a ecting our operations; other geological, operating and economic considerations and declining prices and market conditions, including supply or demand for maintenance, repair and operating products, equipment and service; inability of the Company or its independent auditors to complete the work necessary in order to le the Form 10-Q in the expected time frame; unanticipated changes to the Company's operating results in the Form 10-Q as led or in relation to prior periods, including as compared to the anticipated changes stated here; unanticipated impact of such changes and its materiality; ability to obtain needed capital, dependence on existing management, leverage and debt service, domestic or global economic conditions, 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 4
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terminology. More information on these risks and other potential factors that could a ect the Company’s business and nancial results is included in the Company’s lings with the Securities and Exchange Commission, 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 led periodic reports on Form 10-K and Form 10-Q and subsequent lings. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. DXP ENTERPRISES, INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ thousands, except share amounts) Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026 2025 2026 2025 Sales $ 587,180$ 513,724$ 1,685,299$ 1,488,975Cost of sales 406,672352,4651,153,1181,019,638 Gross pro t 180,508161,259532,181469,337Selling, general and administrative expenses128,046117,561381,752339,138 Income from operations 52,462 43,698150,429130,199Interest expense 16,949 14,894 50,223 44,298Other (income) expense, net (950) (648) (2,603) (2,320) Income before income taxes 36,463 29,452102,80988,221Provision for income taxes 9,593 7,821 27,253 22,389 Net income 26,870 21,631 75,556 65,832Preferred stock dividend 23 23 68 68 Net income attributable to common shareholders$ 26,847$ 21,608$ 75,488$ 65,764 Net income $ 26,870$ 21,631$ 75,556$ 65,832 Foreign currency translation adjustments(118) (709) (3,073) 1,940 Comprehensive income $ 26,752$ 20,922$ 72,483$ 67,772 Earnings per share:Basic $ 1.73$ 1.38$ 4.87$ 4.19Diluted $ 1.64$ 1.31$ 4.62$ 3.98Weighted average common shares outstanding:Basic 15,513 15,686 15,517 15,693Diluted 16,353 16,526 16,357 16,533 DXP ENTERPRISES, INC. AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS ($ thousands, except share amounts) September 30,2026December 31,2025ASSETSCurrent assets: Cash $ 218,834$ 303,783Accounts receivable, net of allowance of $4,163 and $3,995, respectively472,409 397,502Inventories 124,100 108,144Ct dti td ti fbilli 68504 53855 5
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Costs and estimated pro ts in excess of billings68,504 53,855 Prepaid expenses and other current assets 39,674 47,033 Total current assets 923,521910,317 Property and equipment, net 122,023 114,822Goodwill 573,034 494,561Other intangible assets, net 114,192 81,351Operating lease right of use assets, net 72,680 74,709 Other long-term assets 12,279 9,395 Total assets $ 1,817,729$ 1,685,155 LIABILITIES AND EQUITYCurrent liabilities: Current maturities of debt $ 8,480$ 8,580Trade accounts payable 123,767 116,765Accrued wages and bene ts 62,164 51,180Customer advances 15,872 15,460Billings in excess of costs and estimated pro ts27,735 15,689Short-term operating lease liabilities 20,042 19,038 Other current liabilities 54,298 45,769 Total current liabilities 312,358272,481 Long-term debt, net of unamortized debt issuance costs and discounts814,736 818,476Long-term operating lease liabilities 54,682 57,509 Other long-term liabilities 65,539 38,250 Total long-term liabilities 934,957914,235 Total liabilities 1,247,3151,186,716 Commitments and Contingencies Shareholders' equity: Series A preferred stock, $1.00 par value; 1,000,000 shares authorized1 1Series B preferred stock, $1.00 par value; 1,000,000 shares authorized15 15Common stock, $0.01 par value, 100,000,000 shares authorized; 20,407,043 issued and 15,516,986outstanding at September 30, 2026 and 20,403,647 issued and 15,513,590 outstanding at December 31,2025 204 204Additional paid-in capital 220,241 220,681Retained earnings 553,745 478,257Accumulated other comprehensive loss (33,680) (30,607) Treasury stock, at cost 4,890,057 and 4,890,057 shares, respectively(170,112) (170,112) Total DXP Enterprises, Inc. equity570,414498,439 Total liabilities and equity $ 1,817,729$ 1,685,155 SEGMENT DATA ($ thousands, unaudited) Three Months EndedSeptember 30,Nine Months EndedSeptember 30,Sales 2026202520262025 Service Centers $ 376,637$ 350,179$ 1,082,511$ 1,016,985Innovative Pumping Solutions 144,115100,551405,514280,273Supply Chain Services 66,42862,994197,274191,717 Total Sales $ 587,180$ 513,724$ 1,685,299$ 1,488,975 Three Months EndedSeptember 30,Nine Months EndedSeptember 30,Operating Income 2026202520262025 Service Centers $ 55,614$ 51,346$ 159,454$ 148,561Innovative Pumping Solutions 23,44418,39971,77750,448Supply Chain Services 5,998 5,304 18,89616,096 Total Segments Operating Income$ 85,056$ 75,049$ 250,127$ 215,105 RECONCILIATION OF OPERATING INCOME FOR REPORTABLE SEGMENTS ($ thousands, unaudited) 6
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Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026202520262025 Income from operations for reportable segments$ 85,056$ 75,049$ 250,127$ 215,105Adjustment for:Amortization of intangibles 6,899 5,370 20,71416,053Corporate expenses 25,69525,98178,98468,853 Income from operations $ 52,462$ 43,698$ 150,429$ 130,199Interest expense 16,94914,89450,22344,298Other (income) expense, net (950) (648) (2,603) (2,320) Income before income taxes$ 36,463$ 29,452$ 102,809$ 88,221 RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION ($ thousands, unaudited) We de ne and calculate EBITDA as Net income attributable to DXP Enterprises, Inc., plus interest, taxes, depreciation, and amortization. We de ne and calculate Adjusted EBITDA as Net income attributable to DXP Enterprises, Inc., plus interest, taxes, depreciation, and amortization plus stock-based compensation expense and all other non-cash charges, adjustments, and non-recurring items. We identify the impact of all other non-cash charges, adjustments and non-recurring items because we believe these items do not directly re ect our underlying operations. We de ne and calculate EBITDA Margin as EBITDA divided by sales. We de ne and calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by sales. The following table sets forth the reconciliation of EBITDA, EBITDA Margin, Adjusted EBITDA and Adjusted EBITDA Margin to the most comparable U.S. GAAP nancial measure (in thousands): Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026 2025 2026 2025 Income before income taxes$ 36,463$ 29,452$ 102,809$ 88,221Plus: Interest expense 16,94914,89450,22344,298Plus: Depreciation and amortization12,355 9,920 36,60928,544 EBITDA $ 65,767$ 54,266$ 189,641$ 161,063Plus: stock compensation expense1,489 1,478 4,757 4,278Plus: other non-recurring items — 757 1,046 992 Adjusted EBITDA $ 67,256$ 56,501$ 195,444$ 166,333 Operating Income Margin 8.9% 8.5% 8.9% 8.7%Net Income Margin 4.6% 4.2% 4.5% 4.4%EBITDA Margin 11.2% 10.6% 11.3% 10.8%Adjusted EBITDA Margin 11.5% 11.0% 11.6% 11.2%(1) Other non-recurring items include non-recurring costs not related to continuing business operations. We de ne and calculate organic sales to include locations and acquisitions under our ownership for at least twelve (1) 7
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months. "Acquisition Sales" are sales from acquisitions that have been under our ownership for less than twelve months and are excluded in our calculation of Organic Sales. "Business Days" are days of the week, excluding Saturdays, Sundays, and holidays, that our locations are open during the year. Depending on the location and the season, our branches may be open on Saturdays and Sundays; however, for consistency, those days have been excluded from the calculation of Business Days. We de ne and calculate Sales per Business Day as sales divided by the number of Business Days in the relevant reporting period. We de ne and calculate Organic Sales per Business Day as Organic Sales divided by the number of Business Days in the relevant reporting period. The following table sets forth the reconciliation of Acquisition Sales, Organic Sales and Organic Sales per Business Day to the most comparable U.S. GAAP nancial measure (in thousands): Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026202520262025 Sales by Business Segment Service Centers $ 376,637$ 350,179$ 1,082,511$ 1,016,985Innovative Pumping Solutions 144,115100,551405,514280,273 Supply Chain Services 66,42862,994197,274191,717 Total DXP Sales $ 587,180$ 513,724$ 1,685,299$ 1,488,975 Acquisition Sales $ 48,832$ 18,403$ 139,425$ 74,120 Organic Sales $ 538,348$ 495,321$ 1,545,874$ 1,414,855Business Days 64 64 190 190Sales per Business Day $ 9,175$ 8,027$ 8,870$ 7,837Organic Sales per Business Day$ 8,412$ 7,739$ 8,136$ 7,447 We de ne and calculate free cash ow as net cash (used in) provided by operating activities less purchases of property and equipment. The following table sets forth the reconciliation of Free Cash Flow to the most comparable GAAP nancial measure (in thousands): Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026202520262025 Net cash from operating activities$ 18,686$ 34,886$ 80,641$ 56,505Less: purchases of property and equipment(4,238) (6,740) (10,153) (37,000) 8
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Free Cash Flow $ 14,448$ 28,146$ 70,488$ 19,505 The following table is a reconciliation of adjusted net income attributable to DXP Enterprises, Inc., a non-GAAP nancial measure, to net income, calculated and reported in accordance with U.S. GAAP (in thousands): Three Months EndedSeptember 30,Nine Months EndedSeptember 30, 2026202520262025 Net Income $ 26,870$ 21,631$ 75,556$ 65,832One-time non-recurring costs — 757 1,046 992Adjustment for taxes — (201) (278) (252) Adjusted Net Income $ 26,870$ 22,187$ 76,324$ 66,572Weighted average common shares outstanding Diluted 16,35316,52616,35716,533Diluted Earnings per Share $ 1.64$ 1.31$ 4.62$ 3.98Adjusted Diluted Earnings per Share$ 1.64$ 1.34$ 4.67$ 4.03 Kent Yee Senior Vice President, CFO 713-996-4700 www.dxpe.com Source: DXP Enterprises, Inc. 9