Company: DXPE
Filing Date: 2025-04-30
Form Type: ARS
Source: 0001020710-25-000081
Chunk: 43

Company: DXP ENTERPRISES INC
Filing Date: 2025-04-30
Form: ARS
Chunk 43
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 and equipment. CURRENT MARKET CONDITIONS AND OUTLOOK Economic Indices The Company monitors several economic indices that have been key indicators for industrial and oil & gas economic activity in the U.S. These include the Industrial Production (IP) and Manufacturing Capacity Utilization (MCU) indices published by the Federal Reserve Board and the Purchasing Managers Index (PMI) published by the Institute for Supply Management (ISM). Additionally, we track the Metalworking Business Index (MBI). A reading above 50 generally indicates expansion. The Company also monitors various oil & gas indicators including active drilling rigs. Below are readings for the fourth quarter versus the full year average: Index Reading Period MCU PMI IP MBI Active Drilling Rigs(1) October 77.0 46.5 102.1 43.9 1,754 November 77.0 48.4 102.3 44.7 1,708 December 77.6 49.3 103.2 46.9 1,660 Fiscal 2024 Q4 average 77.2 48.1 102.5 45.2 1,707 Fiscal 2024 average 77.6 48.3 102.6 45.7 1,735 Fiscal 2023 average 79.3 47.1 102.8 46.5 1,814 Fiscal 2022 average 79.7 53.5 103.9 53.9 1,747 (1) From Baker Hughes’ Worldwide Rig Counts - Current Data The continued disruption in economic markets due to inflation, changing interest rates, tariffs, trade disputes, business interruptions due to natural disasters and changes in weather patterns, employee shortages, and supply chain issues, all pose challenges which may adversely affect our future performance. The Company continues to execute various strategies previously implemented to help mitigate the impact of these economic disruptors. Sales for the year ended December 31, 2024 increased $123.4 million, or 7.4%, to approximately $1.8 billion from $1.7 billion for the prior corresponding period. Customer demand was generally healthy throughout fiscal 2024, resulting in industry expected volume growth, complemented by additional pricing actions taken by the Company's vendors after strong pricing action in 2022 and 2023, which ultimately, gets passed on to customers. As such, some of the 2024 sales increase is the result of increases in price with increases in volume