Global Industrial Company on Thursday reported a more than 9% increase in full-year sales — but the company’s spring acquisition of Indoff accounted for the entirety of that jump.
The Long Island-based industrial and MRO distributor — no. 19 on ID’s latest Big 50 — posted $1.27 billion in sales in 2023. Although that represented a 9.3% increase over 2022 levels and a new record for the company, when excluding Indoff’s operations, sales were down by 0.7% year-over-year. The company’s net income, operating income and gross margin were also down compared to 2022.
The final quarter of the fiscal year, however, saw a 5% increase in organic sales compared to the last three months of 2022; when adding Indoff’s revenue following the May 2023 acquisition, sales were up by nearly 23% to $320 million.
Global Industrial CEO Barry Litwin said the demand environment improved throughout the year and noted that pricing pressures also eased. The fourth quarter, in particular, featured improved volume and a strong performance from the company’s e-commerce channel. He said the first weeks of the new year saw “modest” organic growth, although the overall environment “remains one of caution.”
"In 2024, we are committed to making the investments that will drive our future performance,” Litwin said in a statement. “Initiatives across the business are designed to elevate Global Industrial's position as an indispensable business partner.”
Global Industrial’s full-year net income fell from $78.8 million to $70.7 million in 2023, which translated to $1.84 per diluted share — down from $2.04 per diluted share in 2022. Operating income from continuing operations slipped from more than $105 million to $96.5 million, while gross profit increased from $421 million to nearly $436 million. Gross margin and operating margin fell from 36.1% and 9%, respectively, to 34.2% and 7.6% year-over-year.
In the fourth quarter, net income, operating income and gross profit all increased, but gross margin dropped from 36% to shy of 34%. Operating margin edged down from 6.8% to 6.7% in the October-December window.
Litwin added that the company’s cash position had improved as of the end of 2023 “even after we fully funded the Indoff acquisition.”
