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DXP Enterprises Reports Preliminary Third Quarter Results

HOUSTON--(BUSINESS WIRE)--DXP Enterprises, Inc. (NASDAQ: DXPE) today released preliminary unaudited selected financial information for its fiscal quarter ended September 30, 2016. The information that follows is preliminary and based upon information available as of today. DXP expects to release its full fiscal quarter results on November 7, 2016.

As of the date of this release, DXP has not completed its financial close process for the quarter. During the course of that process, the Company may identify items that would require it to make adjustments, which may be material, to the information presented below. As a result, the estimates below constitute forward-looking information and are subject to risks and uncertainties, including possible adjustments to preliminary operating results.

DXP Enterprises 2016 third quarter preliminary financial highlights:

  • Sales are anticipated to be between $228.0 million and $231.0 million for the third quarter of 2016, compared to $256.2 million for the second quarter of 2016, a decrease between 9.8 percent to 11.0 percent. Compared to sales for the third quarter of 2015 of $303.1 million, this represents a decrease of between 23.8 percent and 24.8 percent. The above comparisons include sales from Vertex, which was sold on October 3, 2016.
  • Gross profit is anticipated to be between $62.0 million and $64.0 million, for the third quarter 2016, compared to $71.6 million for the second quarter of 2016 and $85.7 million in the third quarter of 2015.
  • Net income (loss) is anticipated to be between $(500) thousand to $500 thousand for the third quarter of 2016, compared to $5.1 million for the second quarter of 2016 and $(52.4) million in the third quarter of 2015 which included a $58.9 million non-cash impairment charge.
  • Earnings before interest, taxes, depreciation and amortization (EBITDA) is anticipated to be between $11.0 million and $13.0 million for the third quarter 2016, compared to $16.3 million in the second quarter of 2016 and $11.3 million in the third quarter of 2015.

Preliminary Unaudited Financial Disclosures

The sales decline in the third quarter is mainly attributable to softness in July sales. This was driven by bookings and shipments softening around the days before and after the July 4th holiday across all three business segments.

David R. Little, Chairman and CEO remarked, “Our third quarter performance reflects a departure from our recent trends, which was primarily associated with lagging sales during the month of July. August and September sales were more in line with average year-to-date monthly performance. That said, we do expect seasonality which can be exacerbated by the upcoming holiday season, the elections, seasonal customer facility shutdowns as well as the recent sale of Vertex. We are pleased with our cost containment measures year-to-date. Free cash flow performance, cash flow from operations less capital expenditures, continues to be in line with expectations and, along with our recent announcement regarding Vertex, continues to provide DXP with resiliency. We look forward to discussing more detailed financial results on our third quarter earnings...


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