DXP Enterprises, Inc. Reports Fourth Quarter and Fiscal 2025 Results

HOUSTON--( BUSINESS WIRE)--DXP Enterprises, Inc. (NASDAQ: DXPE) today announced financial results for the fourth quarter and fiscal year ended December 31, 2025. The following are results for the three and twelve months ended December 31, 2025, compared to the three and twelve months ended December 31, 2024. A reconciliation of the non-GAAP financial measures can be found in the back of this press release.

Fourth Quarter 2025 financial highlights:

Fiscal Year 2025 financial highlights:

Business segment financial highlights:

David R. Little, Chairman and Chief Executive Officer, remarked, “DXP accomplished a lot in 2025, and we would like to thank all our 'DXPeople' for their efforts this year. We were focused on improving and managing our growth, culture, expenses, working capital, and ease of doing business, with our business segments and product divisions. DXPeople drove fourth quarter results well above expectations, with strong performance across DXP. Broad based business strength across the business helped us deliver 11.9 percent revenue growth on a year-over-year basis. This growth has fueled a healthy momentum coming into 2026. DXP’s Innovative Pumping Solutions sales were up 26.4 percent to $390.3 million, followed by Service Centers sales growing 11.0 percent to $1.4 billion and Supply Chain Services sales declining 1.4 percent to $252.9 million. Congratulations to all our DXPeople for their hard work and efforts to serve our customers."

Mr. Little continued, "The sales momentum from the fourth quarter has positioned us for further success as we move into 2026. Additionally, we strengthened our balance sheet in the fourth quarter, raising an incremental $205 million under our Term Loan B. The strength of the balance sheet, the balanced end markets that we have delivered upon, and our ability to continue to execute on acquisitions have set the stage for 2026. We have a positive outlook for end markets like water & wastewater and see positive dynamics developing in the 2nd half of 2026 for our traditional end markets like energy. We are confident our growth strategy, coupled with a continued focus on improving margins and maintaining operational discipline will drive shareholder value."

Kent Yee, Chief Financial Officer commented, "Fiscal 2025 financial performance reflects 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 11.9 percent and 17.8 percent, respectively. We delivered strong sales growth, operating margin expansion, and thus, operating leverage of 1.5x. Our fiscal 2025 diluted earnings per share was $5.37. We are pleased with the fourth quarter, and year-end results. We positioned our balance sheet in the fourth quarter to support our growth plans in 2026. DXP ended the year with $303.8 million in cash on the balance sheet and net debt of $543.0 million. DXP’s secured leverage ratio or net debt to EBITDA was 2.3:1.0 with a covenant EBITDA of $241.4 million for fiscal 2025, which continues to remain significantly below our covenant of 5.75:1.0. We continue to have momentum going into fiscal 2026 and we expect to drive both organic and acquisition driven growth while driving shareholder and stakeholder value."

Conference Call Information

DXP Enterprises, Inc. management will host a conference call, February 26, 2026, at 10:30 a.m. Central Time, to discuss the Company’s financial 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 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

Non-GAAP Financial Measures

DXP supplements reporting of net income with non-GAAP measurements, including EBITDA, adjusted EBITDA, free cash flow, Adjusted Net Income attributable to DXP Enterprises, Inc., and net debt. This supplemental information should not be considered in isolation or as a substitute for the unaudited GAAP measurements. Additional information regarding EBITDA, free cash flow and Adjusted Net Income attributable to DXP Enterprises, Inc. 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 effectiveness of operational strategies. Additionally, EBITDA performance is a component of a measure of the Company’s financial covenants under its credit facility. 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 financial measure as a reasonable basis for comparing ongoing results of operations. By providing this non-GAAP financial measure, together with a reconciliation from net income, 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.

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, Mexico and the U.A.E. 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 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.

DXP ENTERPRISES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

($ thousands, except per share amounts)

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024

2025

2024

Sales

527,390

470,914

2,016,365

1,802,040

Cost of sales

360,799

322,422

1,380,437

1,245,763

Gross profit

166,591

148,492

635,928

556,277

Selling, general and administrative expenses

119,920

109,201

459,058

410,895

Income from operations

46,671

39,291

176,870

145,382

Interest expense

16,232

17,283

60,530

63,927

Other income, net

(562

)

(673

)

(2,882

)

(3,517

)

Income before income taxes

31,001

22,681

119,222

84,972

Provision for income taxes

8,156

1,318

30,545

14,483

Net income

22,845

21,363

88,677

70,489

Preferred stock dividend

Net income attributable to common shareholders

22,823

21,341

88,587

70,399

Net income

22,845

21,363

88,677

70,489

Foreign currency translation adjustments

1,063

(2,229

)

3,003

(2,370

)

Comprehensive income

23,908

19,134

91,680

68,119

Earnings per share:

Basic

1.46

1.36

5.65

4.44

Diluted

1.39

1.29

5.37

4.22

Weighted average common shares outstanding:

Basic

15,595

15,695

15,667

15,861

Diluted

16,435

16,535

16,507

16,701

DXP ENTERPRISES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS

($ thousands, except share amounts)

December 31, 2025

December 31, 2024

ASSETS

Current assets:

Cash

303,783

148,320

Restricted cash

—

Accounts receivable, net of allowance of $3,995 and $5,172, respectively

397,502

339,365

Inventories

108,144

103,113

Costs and estimated profits in excess of billings

53,855

50,735

Prepaid expenses and other current assets

47,033

20,250

Total current assets

910,317

661,874

Property and equipment, net

114,822

81,556

Goodwill

494,561

452,343

Other intangible assets, net

81,351

85,679

Operating lease right of use assets, net

74,709

46,569

Other long-term assets

9,395

21,473

Total assets

1,685,155

1,349,494

LIABILITIES AND EQUITY

Current liabilities:

Current maturities of debt

8,580

6,595

Trade accounts payable

116,765

103,728

Accrued wages and benefits

51,180

41,650

Customer advances

15,460

13,655

Billings in excess of costs and estimated profits

15,689

12,662

Short-term operating lease liabilities

19,038

14,921

Other current liabilities

45,769

50,773

Total current liabilities

272,481

243,984

Long-term debt, net of unamortized debt issuance costs and discounts

818,476

621,684

Long-term operating lease liabilities

57,509

33,159

Other long-term liabilities

38,250

27,879

Total long-term liabilities

914,235

682,722

Total liabilities

1,186,716

926,706

Shareholders' Equity:

Series A preferred stock, $1.00 par value; 1,000,000 shares authorized

Series B preferred stock, $1.00 par value; 1,000,000 shares authorized

Common stock, $0.01 par value, 100,000,000 shares authorized; 20,403,647 issued and 15,513,590 outstanding at December 31, 2025 and 20,402,861 issued and 15,695,088 outstanding at December 31, 2024

204

Additional paid-in capital

220,681

219,511

Retained earnings

478,257

389,670

Accumulated other comprehensive loss

(30,607

)

(33,610

)

Treasury stock, at cost 4,890,057 and 4,707,773 shares, respectively

(170,112

)

(153,003

)

Total DXP Enterprises, Inc. equity

498,439

422,788

Total liabilities and equity

1,685,155

1,349,494

SEGMENT DATA

($ thousands, unaudited)

Three Months Ended December 31,

Twelve Months Ended December 31,

Sales

2025

2024 (1)

2025

2024 (1)

Service Centers

356,155

314,673

1,373,140

1,236,775

Innovative Pumping Solutions

110,018

93,752

390,291

308,850

Supply Chain Services

61,217

62,489

252,934

256,415

Total DXP Sales

527,390

470,914

2,016,365

1,802,040

Three Months Ended December 31,

Twelve Months Ended December 31,

Operating Income

2025

2024 (1)

2025

2024 (1)

Service Centers

49,605

45,686

198,166

179,522

Innovative Pumping Solutions

19,775

14,529

70,223

51,063

Supply Chain Services

5,823

5,088

21,919

21,742

Total segment operating income

75,203

65,303

290,308

252,327

(1) Prior period segment disclosures have been recast

RECONCILIATION OF OPERATING INCOME FOR REPORTABLE SEGMENTS

($ thousands, unaudited)

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024

2025

2024

Income from operations for reportable segments

75,203

65,303

290,308

252,327

Adjustment for:

Amortization of intangibles (1)

5,617

5,494

21,670

19,827

Corporate expenses, net

22,915

20,518

91,768

87,118

Income from operations

46,671

39,291

176,870

145,382

Interest expense

16,232

17,283

60,530

63,927

Other (income) expense, net

(562

)

(673

)

(2,882

)

(3,517

)

Income before income taxes

31,001

22,681

119,222

84,972

(1) Amortization of intangible assets is recorded at the corporate level.

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

($ thousands, unaudited)

The following table is a reconciliation of EBITDA, EBITDA Margin, Adjusted EBITDA and Adjusted EBITDA Margin to the most comparable U.S. GAAP financial measure (in thousands):

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024

2025

2024

Income before income taxes

31,001

22,681

119,222

84,972

Plus: Interest expense

16,232

17,283

60,530

63,927

Plus: Depreciation and amortization

10,306

9,020

38,850

33,405

EBITDA

57,539

48,984

218,602

182,304

Plus: stock compensation expense

1,430

1,316

5,708

4,714

Plus: other non-recurring items (1)

—

992

4,292

Adjusted EBITDA

58,969

50,300

225,302

191,310

Operating Income Margin

8.8

8.3

8.8

8.1

EBITDA Margin

10.9

10.4

10.8

10.1

Adjusted EBITDA Margin

11.2

10.7

11.2

10.6

(1) Other non-recurring items includes unique acquisition integration costs and other non-cash, non-recurring costs not related to continuing business operations.

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 financial measure (in thousands):

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024 (1)

2025

2024 (1)

Sales by Business Segment

Service Centers

356,155

314,673

1,373,140

1,236,775

Innovative Pumping Solutions

110,018

93,752

390,291

308,850

Supply Chain Services

61,217

62,489

252,934

256,415

Total DXP Sales

527,390

470,914

2,016,365

1,802,040

Acquisition Sales

21,923

34,787

96,043

98,500

Organic Sales

505,467

436,127

1,920,322

1,703,540

Business Days

252

253

Sales per Business Day

8,506

7,595

8,001

7,123

Organic Sales per Business Day

8,153

7,034

7,620

6,733

(1) Prior period segment disclosures have been recast.

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION CONTINUED

($ thousands, unaudited)

The following table sets forth a reconciliation of Free Cash Flow to the most comparable U.S. GAAP financial measure (in thousands):

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024

2025

2024

Net cash from operating activities

37,759

32,143

94,264

102,211

Less: purchases of property and equipment, net

(3,286

)

(9,395

)

(40,286

)

(25,068

)

Free Cash Flow

34,473

22,748

53,978

77,143

The following table is a reconciliation of adjusted net income attributable to DXP Enterprises, Inc., a non-GAAP financial measure, to net income, calculated and reported in accordance with U.S. GAAP (in thousands):

Three Months Ended December 31,

Twelve Months Ended December 31,

2025

2024

2025

2024

Net Income

22,845

21,363

88,677

70,489

One-time debt financing costs

1,623

—

1,623

Other non-cash items

—

992

4,292

Adjustment for taxes

)

(101

)

(254

)

(1,008

)

Adjusted Net Income

22,843

22,885

89,415

75,396

Weighted average common shares and common equivalent shares outstanding

Diluted

16,435

16,535

16,507

16,701

Diluted Earnings per Share

1.39

1.29

5.37

4.22

Adjusted Diluted Earnings per Share

1.39

1.38

5.42

4.51