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DSG Q1 2025 Earnings Report
DSG reported its first quarter 2025 results, with revenues up 14.9% and consolidated organic average daily sales up 4.3%.
Key Takeaways
Distribution Solutions Group (DSG) announced strong first quarter 2025 results, with revenues increasing by 14.9% to $478.0 million and adjusted EBITDA growing by 18.6% to $42.8 million. The company also reported net income of $3.261 million and diluted EPS of $0.07, while expanding net margins across its three verticals.
Revenue increased by $61.9 million, or 14.9%, to $478.0 million, including $50.8 million from five acquisitions closed in 2024.
Adjusted EBITDA grew by $6.7 million to $42.8 million, or 9.0% of sales, compared to $36.1 million, or 8.7% of sales in the prior year quarter.
Operating income was $20.1 million, a significant increase from $2.8 million in the prior year quarter.
Diluted net income per share was $0.07 for the quarter, compared to a diluted net loss per share of $0.11 in the year-ago quarter.
DSG
DSG
DSG Revenue by Segment
DSG Revenue by Geographic Location
Revenue by Segment
Lawson Products Revenue
CapyFin.comCanada Branch Division Revenue
CapyFin.comGexpro Services Revenue
CapyFin.comTestEquity Revenue
CapyFin.comRevenue by Geographic Location
Canada Branch Division Revenue
CapyFin.com Forward Guidance
DSG is cautiously optimistic about 2025, expecting to leverage its industrial distribution platform for long-term value creation through organic growth and strategic M&A, while focusing on managing capital structure and generating high cash flow.
Positive Outlook
- Well-positioned to help customers navigate alternative sourcing and services as trade policies develop.
- Focus on long-term value creation through growth of industrial distribution platform.
- Building higher-margin businesses by strategically scaling platform through organic growth and M&A.
- Focus on managing capital structure and generating high cash flow conversion rates.
- Confident in plans to improve structural margins and achieve higher return goals.
Challenges Ahead
- Macro uncertainties affected all U.S. companies.
- Source Atlantic acquisition compressed Adjusted EBITDA as a percentage of sales by approximately 60bps over the year ago quarter.
- Sequentially, Adjusted EBITDA decreased by $2.1 million from the fourth quarter of 2024.
- Organic average daily sales decreased 1.4% sequentially over the fourth quarter of 2024.
- Initiatives to improve margins in five 2024 acquisitions are in early innings.
Revenue & Expenses
Visualization of income flow from segment revenue to net income