HOUSTON, Oct. 28, 2004 (PRIMEZONE) -- DXP Enterprises, Inc. (Nasdaq:DXPE) today announced net income of $743,000 for the third quarter ending September 30, 2004, with diluted earnings per share of $.13 compared to net income of $652,000 and diluted earnings per share of $.13 for the third quarter of 2003. Sales increased 6.2% to $42.9 million from $40.4 million for the third quarter of last year. Increased shipments to the oil and gas industries account for the increase in sales. Gross profit was negatively impacted by pipe supplier problems and the timing of passing on vendor price increases to our customers.
Year-to-date earnings as of September 30, 2004 were $2.1 million, or $0.39 per diluted share, compared to $1.6 million, or $0.33 per diluted share for the first nine months of 2003. Sales increased 6.3% to $122.8 million from $115.6 million for the first nine months of 2003.
David R. Little, Chairman and Chief Executive Officer said, "Even though our financial results were good, they would have been better if gross profit had not been negatively impacted by pipe failures and vendor price increases. We look forward to increased margins and continue to believe we are ideally positioned for stronger growth."
"We continue to believe that our commitment to customer service and our cost saving initiatives for industrial customers make DXP a valued and reliable resource for innovative pumping solutions, SmartSource(SM), and maintenance, repair, operations and production (MROP) products and services," said Little.
DXP Enterprises, Inc., based in Houston, Texas, is a leading distributor of products and services for capital equipment projects and industrial MROP customers. Value added services include integrated supply solutions through the Company's SmartSource(SM) program, engineering expertise, fabrication, repair, consignments, vendor managed inventory (VMI), and logistics capabilities for industrial customers. SmartSource allows a customer to choose from a complete continuum of supply options, ranging from traditional distribution to integrated supply. This program offers a customer a more effective way to manage his MROP supply needs and to realize documented cost savings by outsourcing supply room purchasing, supply room accounting, and supply room management to DXP. DXP also provides fluid handling equipment, bearings, power transmission equipment, general mill supplies, safety supplies and electrical products to customers in the general manufacturing, energy, petrochemical, service and repair, and wood products industries.
The Private Securities Litigation Reform Act of 1995 provides a "safe-harbor" for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made by or to be made by the Company) contains statements that are forward-looking. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future; and accordingly, such results may differ from those expressed in any forward-looking statement made by or on behalf of the Company. These risks and uncertainties include, but are not limited to; ability to obtain needed capital, dependence on existing management, leverage and debt service, domestic or global economic conditions, and changes in customer preferences and attitudes. For more information, review the Company's filings with the Securities and Exchange Commission.
DXP ENTERPRISES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended Nine Months Ended
September 30, September 30,
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2004 2003 2004 2003
------- -------- -------- --------
Sales $42,871 $ 40,363 $122,836 $115,590
Cost of sales 32,928 30,056 93,222 86,257
------- -------- -------- --------
Gross profit 9,943 10,307 29,614 29,333
Selling, general
and administrative
expense 8,563 9,010 25,647 25,932
------- -------- -------- --------
Operating income 1,380 1,297 3,967 3,401
Other income 11 13 40 50
Interest expense (233) (277) (667) (947)
------- -------- -------- --------
Income before taxes 1,158 1,033 3,340 2,504
Provision for income
taxes 415 381 1,205 939
------- -------- -------- --------
Net income 743 652 2,135 1,565
Preferred stock
dividend 23 23 68 68
------- -------- -------- --------
Net income attributable
to common shareholders $ 720 $ 629 $ 2,067 $ 1,497
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Basic income per
share $ 0.18 $ 0.15 $ 0.51 $ 0.37
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Weighted average
common shares
outstanding 4,015 4,072 4,025 4,072
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Diluted income per
share $ 0.13 $ 0.13 $ 0.39 $ 0.33
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Weighted average
common and common
equivalent shares
outstanding 5,531 5,181 5,488 4,721
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