Houston-based pumping solutions and MROP products distributor DXP Enterprises reported its 2020 third quarter financial results on Friday, showing accelerated year-over-year sales declines compared to Q2.
The company posted total Q3 sales of $220 million, down 32.7 percent year-over-year (YoY), compared to a 24.6 percent decline in Q2. Sequentially, sales were down 11.6 percent from Q2. Gross profit of $61 million in Q3 fell 33.9 percent YoY, while the company took an operating loss of $41 million, compared to a $22 million profit a year earlier and a $7 million profit in Q2.
DXP took a Q3 net loss of $35 million, compared to a $13 million profit a year earlier.
By DXP business segment in Q3
- Service Centers revenue of $165 million fell 14.9 percent YoY on operating margin of 13.4 percent. Sequentially, that compares with Q2 revenue of $154 million and an 8.9 percent margin.
- Innovative Pumping Solutions revenue of $22 million fell 73.4 percent YoY on operating margin of 13.3 percent. Sequentially, that compares with Q2 revenue of $60.5 million and margin of 14.2 percent.
- Supply Chain Services revenue of $33 million fell 34.8 percent YoY on operating margin of 8.7 percent. Sequentially, that compares with Q2 revenue of $37 million and margin of 9.0 percent.
"Although the majority of lockdowns have been easing and economic activity is likely near trough levels, visibility on the economic outlook remains extremely limited," said David Little, DXP chairman and CEO. "Specifically, the risk of a third wave of virus cases, the reinstitution of select geographic lockdowns, and the risk of lingering high unemployment create an uncertain economic environment that likely persists through the rest of 2020, based upon what we know today."