Company: DXPE
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-050322
Chunk: 16

Company: DXP ENTERPRISES INC
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 16
---
954)(37,000)(15,673)Free Cash Flow$28,146 $24,390 $19,505 $54,395 

Uses of Liquidity

Internally generated cash flows are the primary source of working capital and growth initiatives, including acquisitions and growth capital expenditures. The Company expects to continue to return excess capital to shareholders through share repurchases, when appropriate.

Working Capital

We monitor net working capital, which excludes cash and restricted cash, short-term debt obligations, and short-term operating leases. Net working capital as of September 30, 2025 was $364.6 million, an increase of $73.6 million compared to $291.0 million as of December 31, 2024. The increase was primarily due to sustained sales growth and acquisitions.

Acquisitions

For a discussion of the Company’s acquisitions refer to Note 12. Business Acquisitions. During September 30, 2025 and 2024, the Company invested $24.4 million and $149.4 million, respectively, in acquisitions.

Capital Expenditures

The Company's capital expenditures was $37.0 million and $15.7 million for the nine months ended September 30, 2025 and 2024 respectively. This includes a purchase of a facility, continued facility upgrades and enhancements, tools and equipment, software and technology investments and enhancements across the Company.

DISCUSSION OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES

Critical accounting and business policies are those that are both most important to the portrayal of a company's financial position and results of operations, and require management's subjective or complex judgments. These policies have been discussed with the Audit Committee of the Board of Directors of DXP.

The Company's unaudited condensed financial statements are prepared in accordance with U.S. GAAP. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared on substantially the same basis as our annual Consolidated Financial Statements and should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024. For a more complete discussion of our significant accounting policies and business practices, refer to the consolidated Annual Report on Form 10-K filed with the SEC on March 10, 2025. The results of operations for the nine months ended September 30, 2025 are not necessarily indicative of results expected for the full fiscal year.

RECENT ACCOUNTING PRONOUNCEMENTS

See Note 3 - Recently Issued Accounting