Exhibit 99.1
DXP Enterprises Announces Improved Second Quarter Results
HOUSTON--(BUSINESS WIRE)--Aug. 7, 2003--DXP Enterprises Inc.
(Nasdaq:DXPE) today announced second quarter 2003 net income of $0.4
million, or earnings per share of $0.10 on a diluted basis, compared
to net income of $0.4 million or $0.09 per diluted share for the
second quarter of 2002. Revenues for the quarter increased to $37.8
million from $37.2 million for the second quarter of last year.
Increased sales of pump products account for the increase.
Year-to-date earnings as of June 30, 2003 were $0.9 million or
$0.20 per diluted share, compared to $0.8 million or $0.17 per diluted
share before the effect of a change in accounting principle for the
six months ended June 30, 2002.
"I am pleased that sales for the second quarter and second half
increased over 2002 levels," said David R. Little, chairman and chief
executive officer. "We are aggressively working to increase sales."
"The Company's bank has provided additional operational
flexibility by reducing interest rates and extending the maturity of
our credit facility. The expiration date of the facility, which has a
borrowing capacity of $30 million has been extended two years to April
1, 2006," stated Mac McConnell, chief financial officer.
In July 2001, new standards were issued relating to accounting for
goodwill. These standards took effect for the Company on Jan. 1, 2002.
As result of these new standards the Company recorded a transitional
impairment loss of $2.5 million before income taxes ($1.7 million
after income taxes). This charge was reported as a cumulative effect
of a change in accounting principle in the first quarter of 2002.
DXP Enterprises Inc., based in Houston, is a leading distributor
of products and services for industrial maintenance, repair,
operations and capital equipment projects, and provides engineering
expertise and logistics capabilities to industrial customers. 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.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
THREE MONTHS ENDED SIX MONTHS ENDED
-----------------------------------
JUNE 30, JUNE 30,
----------------- -----------------
2003 2002 2003 2002
-------- -------- -------- --------
Sales $37,766 $37,159 $75,227 $74,762
Cost of sales 28,226 27,558 56,201 55,534
-------- -------- -------- --------
Gross profit 9,540 9,601 19,026 19,228
Selling, general and administrative
expense 8,508 8,545 16,922 17,147
-------- -------- -------- --------
Operating income 1,032 1,056 2,104 2,081
Other income 15 18 37 49
Interest expense (327) (437) (670) (856)
-------- -------- -------- --------
Income before income taxes 720 637 1,471 1,274
Provision for income taxes 275 238 558 509
-------- -------- -------- --------
Net income before cumulative effect
of a change in accounting
principle 445 399 913 765
Cumulative effect of a change in
accounting principle -- -- -- (1,729)
-----------------------------------
Net income (loss) $445 $399 $913 $(964)
===================================
Per share and share amounts before
cumulative effect of a change
in accounting principle
Basic earnings per common share $0.10 $0.09 $0.21 $0.18
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Common shares outstanding 4,072 4,072 4,072 4,072
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Diluted earnings per share $0.10 $0.09 $0.20 $0.17
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Common and common equivalent
shares outstanding 4,643 4,572 4,591 4,560
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Cumulative effect of a change in
accounting principle per share
- basic and diluted -- -- -- $(0.42)
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Basic income (loss) per share $0.10 $0.09 $0.21 $(0.25)
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Common shares outstanding 4,072 4,072 4,072 4,072
======== ======== ======== ========
Diluted income (loss) per share $0.10 $0.09 $0.20 $(0.25)
======== ======== ======== ========
Common and common equivalent shares
outstanding 4,643 4,572 4,591 4,072
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CONTACT: DXP Enterprises Inc., Houston
Mac McConnell, 713-996-4700
www.dxpe.com