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Item 1. Financial Statements

2026-05-07 compared with 2025-11-06 · 99 added, 209 removed, 424 unchanged (42% of the section changed)

5 unchanged sentences

(in thousands, except per share amounts) (unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Three Months Ended March 31,

Sales $ 521,658 $ 476,569

4 unchanged sentences

Interest expense 16,443 14,660

Other (income) expense, net (Note 15)

Other income, net (Note 15)

( 594 ) ( 1,318 )

Income before income taxes 26,625 27,173

Provision for income taxes 7,821 2,631 22,389 13,165

Provision for income taxes ( Note 7 )

Net income 19,978 20,589

15 unchanged sentences

(in thousands, except share amounts) (unaudited)

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Current assets:

Cash $ 213,381 $ 303,783

Restricted cash — 91

Accounts receivable, net of allowance of $ 4,299 and $ 3,995 , respectively

33 unchanged sentences

Common stock, $ 0.01 par value, 100,000,000 shares authorized;

20,404,367 issued and 15,677,406 outstanding at September 30, 2025 and 20,402,861 issued and 15,695,088 outstanding at December 31, 2024

20,395,996 issued and 15,505,939 outstanding at March 31, 2026 and 20,403,647 issued and 15,513,590 outstanding at December 31, 2025

Additional paid-in capital 215,948 220,681

11 unchanged sentences

(in thousands) (unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

3 unchanged sentences

Amortization of intangibles and finance lease assets

20,898 17,564

Amortization of debt issuance costs 1,129 965

Gain on sale of property and equipment ( 426 ) —

Recovery of (provision for) credit losses 74 ( 783 )

Payment of contingent consideration liability in excess of acquisition-date fair value ( 459 ) ( 108 )

Loss (gain) on sale of property and equipment

Provision for (recovery of) credit losses

279 ( 1,322 )

Fair value adjustment on contingent consideration 239 183

19 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES:

Borrowings on asset-backed credit facility — 6,000

Repayments on asset-backed credit facility — ( 6,000 )

Principal debt payments ( 2,120 ) ( 1,624 )

Debt issuance costs ( 125 ) ( 125 )

Shares repurchased held in treasury ( 1,999 ) ( 28,783 )

Payment for acquisition contingent consideration liability ( 2,250 ) ( 3,820 )

21 unchanged sentences

Currency translation adjustment — — — — — ( 1,464 ) — ( 1,464 )

Excise tax on share repurchases — — — — — — 28 28

— — — — 19,978 — — 19,978

Balance at March 31, 2026 $ 1 $ 15 $ 204 $ 215,948 $ 498,212 $ ( 32,071 ) $ ( 170,112 ) $ 512,197

Preferred dividends paid — — — — ( 22 ) — — ( 22 )

Compensation expense for restricted stock

— — — 1,483 — — — 1,483

Tax related items for share based awards — — — ( 4,203 ) — — — ( 4,203 )

Currency translation adjustment — — — — — 2,563 — 2,563

— — — — 23,612 — — 23,612

Balance at June 30, 2025 $ 1 $ 15 $ 204 $ 217,982 $ 433,826 $ ( 30,961 ) $ ( 152,975 ) $ 468,092

Preferred dividends paid — — — — ( 23 ) — — ( 23 )

Compensation expense for restricted stock

— — — 1,478 — — — 1,478

Tax related items for share based awards — — — ( 131 ) — — — ( 131 )

Currency translation adjustment — — — — — ( 709 ) — ( 709 )

Repurchases of shares — — — — — — ( 1,999 ) ( 1,999 )

Net income — — — — 21,631 — — 21,631

Balance at September 30, 2025 $ 1 $ 15 $ 204 $ 219,329 $ 455,434 $ ( 31,670 ) $ ( 154,974 ) $ 488,339

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

Series A preferred stock Series B preferred stock Common stock Paid-in capital Retained earnings Accum other comp loss Treasury Stock Total equity

4 unchanged sentences

Currency translation adjustment — — — — — 86 — 86

Repurchases of shares — — — — — — ( 16,805 ) ( 16,805 )

Excise tax on share repurchases — — — — — — 28 28

1 unchanged sentence

Balance at March 31, 2025 $ 1 $ 15 $ 204 $ 220,702 $ 410,236 $ ( 33,524 ) $ ( 152,975 ) $ 444,659

Preferred dividends paid — — — — ( 22 ) — — ( 22 )

Compensation expense for restricted stock — — — 1,212 — — — 1,212

Tax related items for share based awards — — — ( 1,701 ) — — — ( 1,701 )

Currency translation adjustment — — — — — 93 — 93

Repurchases of shares — — — — — — ( 6,992 ) ( 6,992 )

Excise tax on share repurchases — — — — — — ( 66 ) ( 66 )

— — — — 16,693 — — 16,693

Balance at June 30, 2024 $ 1 $ 15 $ 345 $ 216,803 $ 347,251 $ ( 31,761 ) $ ( 147,973 ) $ 384,681

Preferred dividends paid — — — — ( 23 ) — — ( 23 )

Restricted stock compensation expense — — — 1,322 — — — 1,322

Tax related items for share based awards — — — ( 63 ) — — — ( 63 )

Currency translation adjustment — — — — — 380 — 380

Repurchases of shares — — — — — — ( 4,985 ) ( 4,985 )

Excise tax on share repurchases — — — — — — ( 45 ) ( 45 )

— — — — 21,101 — — 21,101

Balance at September 30, 2024 $ 1 $ 15 $ 345 $ 218,062 $ 368,329 $ ( 31,381 ) $ ( 153,003 ) $ 402,368

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

5 unchanged sentences

together with its subsidiaries (collectively "DXP," the "Company," "us," "we," or "our") was incorporated in Texas on July 26, 1996.

DXP Enterprises, Inc.

and its subsidiaries are engaged in the business of distributing maintenance, repair and operating ("MRO") products and services to a variety of end markets and business-to-business customers.

Additionally, DXP provides integrated, custom pump skid packages, pump remanufacturing and manufactures branded private label pumps to energy and broad industrial customers.

The Company is currently organized into three business segments:

The Company and its subsidiaries are engaged in the business of distributing maintenance, repair and operating ("MRO") products, and service to customers serving a variety of end markets.

Additionally, the Company provides integrated, custom pump skid packages, pump remanufacturing and manufactures branded private label pumps to energy and industrial customers.

The Company is organized into three business segments:

Service Centers ("SC"), Innovative Pumping Solutions ("IPS"), and Supply Chain Services ("SCS").

2 unchanged sentences

Basis of Presentation

The Company's financial statements are prepared in accordance with generally accepted accounting principles in the United States of America ("U.S.

The Company's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S.

For interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the U.S.

1 unchanged sentence

GAAP are required.

The unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2024 that are included in our annual report on Form 10-K filed with the SEC on March 10, 2025 (“Annual Report”).

Certain reclassifications were made to the prior year’s consolidated financial statements to conform to the current year presentation.

Such reclassifications did not have a material effect on our consolidated statements of operations and comprehensive income, balance sheets, cash flows or equity.

The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of results expected for the full fiscal year.

The unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2025 that are included in our annual report on Form 10-K filed with the SEC on February 26, 2026 (“Annual Report”).

At times, certain reclassifications may be made to the prior year’s unaudited condensed consolidated financial statements to conform to the current year's presentation.

Such reclassifications do not have a material effect on our unaudited condensed consolidated statements of operations and comprehensive income, balance sheets, cash flows or equity.

The results of operations for the three months ended March 31, 2026 are not necessarily indicative of results expected for the full fiscal year.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments necessary for the fair statement of the Company's financial position, results of operations and cash flows for the interim periods presented.

2 unchanged sentences

All new accounting pronouncements that have been issued but not yet effective are currently being evaluated and at this time are not expected to have a material impact on our financial position or results of operations.

Recently Adopted Accounting Pronouncements

In July 2025, the FASB issued Accounting Standards Update 2025-05, Financial Instruments – Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”).

ASU 2025-05 provides a practical expedient that all entities can use when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, Revenue from Contracts with Customers.

Under this practical expedient, an entity is allowed to assume that the current conditions it has applied in determining credit loss allowances for current accounts receivable and current contract assets remain unchanged for the remaining life of those assets.

ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods in those years.

We have elected to apply the practical expedient.

There was no material impact to our unaudited condensed consolidated financial statements.

Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

In November 2024, the FASB issued Accounting Standards Update (“ASU”) No.

2024-03, Disaggregation of Income Statement Expenses (Subtopic 220-40).

6 unchanged sentences

We are currently evaluating the provisions of this ASU.

In December 2023, FASB issued ASU No.

2023-09, Improvements to Income Tax Disclosures (Topic 740).

The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid.

The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024.

Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance.

This ASU will likely result in the required additional disclosures being included in our consolidated financial statements, once adopted.

We are currently evaluating the provisions of this ASU.

NOTE 4 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

5 unchanged sentences

Changes in the fair value of the contingent consideration are measured each reporting period and reflected in our results of operations.

As of September 30, 2025, there was $ 10.6 million in other current and other long-term liabilities for contingent consideration.

The following table provides a reconciliation of the beginning and ending balances and gains or losses recognized during the nine months ended September 30, 2025 ( in thousands ):

As of March 31, 2026, there was $ 29.1 million in other current and other long-term liabilities for contingent consideration.

The following table provides a reconciliation of the beginning and ending balances and gains or losses recognized during the three months ended March 31, 2026 ( in thousands ):

Contingent Consideration

*Beginning balance at December 31, 2024 $ 16,322

Balance at December 31, 2025

Acquisitions and settlements:

3 unchanged sentences

Changes in fair value recorded in other expense (income), net

*Ending Balance at September 30, 2025 $ 10,604

*Amounts included in other current liabilities were $ 7.7 million and $ 8.0 million for the periods ending September 30, 2025 and December 31, 2024, respectively.

Amounts included in other long-term liabilities were $ 2.9 million and $ 8.3 million for the periods ending September 30, 2025 and December 31, 2024, respectively.

Balance at March 31, 2026

*Amounts included in other current liabilities were $ 13.1 million and $ 9.4 million for the periods ending March 31, 2026 and December 31, 2025, respectively.

Amounts included in other long-term liabilities were $ 16.0 million and $ 4.4 million for the periods ending March 31, 2026 and December 31, 2025, respectively.

Sensitivity to Changes in Significant Unobservable Inputs

2 unchanged sentences

Changes in our unobservable inputs in isolation would result in a change to our fair value measurement.

As of September 30, 2025, the maximum amount of contingent consideration payable under these arrangements is $ 11.8 million over three years .

Other financial instruments not measured at fair value on the Company's unaudited condensed consolidated balance sheets at September 30, 2025 and December 31, 2024, but which require disclosure of their fair values include:

As of March 31, 2026, the maximum amount of contingent consideration payable under these arrangements is $ 32.5 million over three years .

Other financial instruments not measured at fair value on the Company's unaudited condensed consolidated balance sheets at March 31, 2026 and December 31, 2025, but which require disclosure of their fair values include:

cash, restricted cash, accounts receivable, trade accounts payable and accrued expenses.

The Company believes that the estimated fair value of such instruments at September 30, 2025 and December 31, 2024 approximates their carrying value as reported on the unaudited condensed consolidated balance sheets due to the relative short maturity of these instruments.

The Company believes that the estimated fair value of such instruments at March 31, 2026 and December 31, 2025 approximates their carrying value as reported on the unaudited condensed consolidated balance sheets due to the relative short maturity of these instruments.

See Note 8 - Long-term Debt for fair value disclosures on our asset-backed line of credit and term loan debt under our syndicated credit agreement facilities.

3 unchanged sentences

The carrying values of inventories are as follows ( in thousands ):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Finished goods $ 106,746 $ 98,089

5 unchanged sentences

Costs and estimated profits on uncompleted contracts and related amounts billed were as follows ( in thousands ):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Costs incurred on uncompleted contracts $ 232,496 $ 147,866

3 unchanged sentences

Net $ 33,646 $ 38,166

Such amounts were included in the accompanying unaudited condensed consolidated balance sheets for September 30, 2025 and December 31, 2024 under the following captions ( in thousands ):

September 30, 2025 December 31, 2024

Such amounts were included in the accompanying unaudited condensed consolidated balance sheets for March 31, 2026 and December 31, 2025 under the following captions ( in thousands ):

March 31, 2026 December 31, 2025

Costs and estimated profits in excess of billings $ 58,971 $ 53,855

1 unchanged sentence

Net $ 33,646 $ 38,166

During the nine months ended September 30, 2025 and 2024, $ 7.9 million and $ 5.3 million of the balances that were previously classified as contract liabilities at the beginning of the period were recognized in revenues, respectively.

During the three months ended March 31, 2026 and 2025, $ 0.8 million and $ 5.1 million of the balances that were previously classified as contract liabilities at the beginning of the period were recognized in revenues, respectively.

Contract asset and liability changes were primarily due to normal activity and timing differences between our performance and customer payments.

1 unchanged sentence

The following table presents provision for income taxes (in thousands, except for effective tax rate):

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Three Months Ended March 31,

Income before provision for income taxes $ 26,625 $ 27,173

4 unchanged sentences

Significant judgment is required in determining our provision for income taxes and evaluating our uncertain tax positions.

The effective tax rate increased primarily due to a lower tax benefit from research and development tax credits, lower tax benefit from stock compensation vested during the period, partially offset by a higher benefit for state income taxes.

The effective tax rate increased slightly, primarily due to discrete items, including a decrease in tax benefits related to stock-based compensation vested during the period, net of amounts limited by Section 162(m), a lower benefit from research and development tax credits, and an increase in non-deductible expenses.

While we believe that we have adequately provided for all uncertain tax positions, or tax positions where we believe it is not more-likely-than-not that the position will be sustained upon review, amounts asserted by tax authorities could be greater or less than our accrued position.

Accordingly, our provisions on federal, state and foreign tax related matters to be recorded in the future may change as revised estimates are made or the underlying matters are settled or otherwise resolved with the respective tax authorities.

On July 4, 2025, the United States Congress passed the budget reconciliation bill H.R.

1, known as the One Big Beautiful Bill Act (“OBBBA”).

Key provisions include the repeal of Section 174 R&D capitalization requirements, the extension of 100% bonus depreciation, restoration of the Section 163(j) interest limitation to an EBITDA basis, and the introduction of a 1% charitable contribution deduction floor.

As of September 30, 2025, the immediate expensing of R&D costs under Section 174, the continuation of 100% bonus depreciation, and the restoration of the EBITDA-based Section 163(j) limitation are expected to decrease cash taxes in the short term and generate a federal net operating loss.

These changes are not expected to have a material impact on the Company’s effective tax rate.

The Organization of Economic Cooperation and Development (“OECD”) continues to release additional guidance, including administrative guidance on how Pillar Two rules should be interpreted and applied by jurisdictions as they adopt Pillar Two.

A number of countries have utilized the administrative guidance as a starting point for legislation that went into effect January 1, 2024.

As of September 30, 2025, DXP anticipates the impact of Pillar Two to be immaterial to the Company based on current legislation that has been enacted to date.

As of March 31, 2026, DXP anticipates the impact of Pillar Two to be immaterial to the Company based on current legislation that has been enacted to date.

NOTE 8 – LONG-TERM DEBT

Long-term debt consisted of the following ( in thousands ):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

ABL Revolver $ — $ —

Amended Senior Secured Term Loan B due October 13, 2030 (1)

Senior Secured Term Loan B due October 13, 2030 (1)

843,765 845,885

9 unchanged sentences

$ 817,360 $ 818,476

(1) The fair value of the Amended Term Loan B due October 13, 2030 using level 2 input values was $ 647.8 million and $ 657.6 million as of September 30, 2025 and December 31, 2024, respectively.

(1) The fair value of the Amended Term Loan B due October 13, 2030 using level 2 input values was $ 849.0 million and $ 854.3 million as of March 31, 2026 and December 31, 2025, respectively.

Senior Secured Term Loan B:

On October 3, 2024, the Company entered into an amendment on its existing Senior Secured Term Loan B (the “Term Loan Amendment”), which provides for, among other things, an additional $ 105.0 million in new incremental commitments.

The Term Loan Amendment refinanced the existing Senior Term Loan B and replaced it with an Amended Senior Secured Term Loan B with total borrowings of $ 649.5 million.

On December 16, 2025, the Company entered into an amendment (the “Term Loan Amendment”), by and among the Company, certain of the Company’s subsidiaries, as guarantors (the “Guarantors”), the incremental lenders party thereto and Goldman Sachs Bank USA as agent (the “Agent”).

The Term Loan Amendment amends and supplements the Term Loan and Security Agreement, dated as of December 23, 2020, by and among the Company, the Guarantors, the lenders party thereto and the Agent (as amended by Amendment No.

1 and Joinder Agreement to Term Loan and Security Agreement, dated as of November 22, 2022, as further amended by Amendment No.

2 and Joinder Agreement to Term Loan and Security Agreement, dated as of October 13, 2023, and as further amended by Amendment No.

3 and Joinder Agreement to Term Loan and Security Agreement, dated as of October 3, 2024, the “Existing Term Loan Agreement”;

the Existing Term Loan Agreement, as further amended by the Term Loan Amendment, the “Term Loan Agreement”).

The Term Loan Amendment provides for, among other things, (i) adjustments to certain financial ratio covenant compliance dates and (ii) $ 205.0 million in new incremental term loan commitments (the “2025 Incremental Term Loans”) under the Term Loan Agreement, such that after giving effect to the Term Loan Amendment, including the 2025 Incremental Term Loans, the Company has $ 848.0 million in outstanding borrowings under the Term Loan Agreement.

The Senior Secured Term Loan B amortizes in equal quarterly installments of 0.25 percent, with the remaining balance being payable on October 13, 2030, when the facility matures.

As of September 30, 2025 there was $ 643.0 million outstanding under the Amended Senior Secured Term Loan B.

As of March 31, 2026 there was $ 843.8 million outstanding under the Senior Secured Term Loan B.

Interest rate

The interest rate for the Amended Senior Secured Term Loan B was 7.91 percent and 8.32 percent as of September 30, 2025 and December 31, 2024, respectively.

Quarterly interest payments accrue on outstanding borrowings under the Senior Secured Term Loan B at a rate equal to Term SOFR (with a floor of 1.00 %) plus 3.25 %, or base rate plus 2.25 %.

The Senior Secured Term Loan B is guaranteed by each of the Company’s direct and indirect material wholly owned subsidiaries, other than any of the Company’s Canadian subsidiaries and certain other excluded subsidiaries.

The interest rate for the Senior Secured Term Loan B was 6.92 percent and 7.17 percent as of March 31, 2026 and December 31, 2025, respectively.

Facility Size Increases

4 unchanged sentences

Restrictive Covenants

The Company’s primary financial covenant under the Term Loan B is a Secured Leverage Ratio.

The Term Loan B Agreement requires that the Company’s Secured Leverage Ratio as of September 30, 2025 to be less than 5.50 to 1.00.

As of September 30, 2025, the Company’s Secured Leverage Ratio was 2.31 to 1.00.

The Company’s primary financial covenant under the Senior Secured Term Loan B is a Secured Leverage Ratio.

The Senior Secured Term Loan B Agreement requires that the Company’s Secured Leverage Ratio as of March 31, 2026 to be less than 5.75 to 1.00.

As of March 31, 2026, the Company’s Secured Leverage Ratio was 2.59 to 1.00.

ABL Revolver:

1 unchanged sentence

Following the effectiveness of the Increase Agreement, the total commitments under the ABL Facility increased from $ 135.0 million to $ 185.0 million.

On July 19, 2022, the Company entered into an Amended and Restated Loan and Security Agreement (the “ABL Credit Agreement”) that provided for a $ 135.0 million asset-backed revolving line of credit (the "ABL Revolver").

Subject to the conditions set forth in the ABL Credit Agreement, the ABL Revolver may be increased in increments of $ 10.0 million up to an aggregate of $ 50.0 million.

The ABL Revolver matures on July 19, 2027.

Interest accrues on outstanding borrowings at a rate equal to SOFR plus a margin ranging from 1.25 percent to 1.75 percent per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25 percent to 0.75 percent per annum, in each case, based upon the average daily excess availability under the ABL Revolver for the most recently completed calendar quarter.

Interest accrues on outstanding borrowings at a rate equal to Secured Overnight Financing Rate (“SOFR”) or Canadian Dollar Offered Rate (“CDOR”) plus a margin ranging from 1.25 percent to 1.75 percent per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25 percent to 0.75 percent per annum, in each case, based upon the average daily excess availability under the ABL Revolver for the most recently completed calendar quarter.

Fees payable on the unused portion of the facility range from 0.25 percent to 0.375 percent per annum.

At September 30, 2025 the unused line fee was 0.375 percent and there were no amounts outstanding under the ABL Revolver.

At March 31, 2026 the unused line fee was 0.375 percent and there were no amounts outstanding under the ABL Revolver.

Each of our current and future wholly owned material U.S.

10 unchanged sentences

Excess Availability

The borrowing availability under our credit facility was $ 153.4 million and $ 125.6 million at September 30, 2025 and December 31, 2024, respectively.

The borrowing availability under our credit facility was $ 153.3 million and $ 153.5 million at March 31, 2026 and December 31, 2025, respectively.

Interest rate

The interest rate for the ABL Revolver was 7.50 percent and 7.75 percent as of September 30, 2025 and December 31, 2024, respectively.

Facility Size Increases

Effective, July 1, 2025, the Company exercised its right to increase the ABL Credit Agreement by an aggregate amount of $ 50 million.

The interest rate for the ABL Revolver was 7.00 percent and 7.00 percent as of March 31, 2026 and December 31, 2025, respectively.

Financial Covenant

2 unchanged sentences

The Company is restricted from allowing its fixed charge coverage ratio to be less than 1.00 to 1.00 during a compliance period, which is triggered when the availability under the ABL Revolver falls below a threshold set forth in the ABL Credit Agreement.

As of September 30, 2025, the Company's Fixed Charge Coverage Ratio was 2.18 to 1.00.

The Company was in compliance with all financial covenants as of September 30, 2025.

As of September 30, 2025, the maturities of long-term debt for the next five years and thereafter were as follows ( in thousands ):

Thereafter 615,401

As of March 31, 2026, the Company's Fixed Charge Coverage Ratio was 2.54 to 1.00.

The Company was in compliance with all financial covenants as of March 31, 2026.

Promissory Note:

On November 1, 2024, in connection with an acquisition, the Company signed a promissory note for the loan amount of $ 1.0 million.

The promissory note has a maturity date of November 1, 2029.

The promissory note shall be payable in four equal consecutive annual installments of $ 0.1 million on November 1 of each year commencing on November 1, 2025, provided that all amounts outstanding under this promissory note, including all accrued and unpaid interest and other amounts payable under the promissory note, shall be due and payable in full on November 1, 2029.

The Company may prepay the promissory note in

whole or in part at any time or from time to time without penalty or premium by paying the principal amount to be prepaid together with accrued interest thereon to the date of the prepayment.

Interest is payable quarterly, starting with the quarter ending January 31, 2025 on outstanding borrowings at a rate of 5 %.

Maturities of Debt

As of March 31, 2026, the maturities of long-term debt for the next five years were as follows ( in thousands ):

Total $ 844,665

3 unchanged sentences

The following table sets forth the computation of basic and diluted earnings per share for the periods indicated ( in thousands, except per share data ):

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

Three Months Ended March 31,

Basic earnings per share:

14 unchanged sentences

Per share amount $ 1.22 $ 1.25

As of September 30, 2025 and 2024, the weighted average of the unvested restricted stock awards were 241,742 and 301,620 shares, respectively.

As of March 31, 2026 and 2025, the weighted average of the unvested restricted stock awards were 219,904 and 302,647 shares, respectively.

The preferred stock is convertible into 840,000 shares of common stock.

21 unchanged sentences

As a part of the Company's annual business planning, the CODM reviews our reportable segment composition and financial performance.

As a result of this review, on January 1st, 2025, we moved certain branch locations previously reported under our IPS segment to our SC segment.

Prior period segment information has not been recast, as the changes to our segment composition did not have a material impact on the operating results of our reportable segments.

As of March 31, 2026, there was no change to our reportable segment composition.

The following table sets forth financial information related to the Company's segments ( in thousands ):

Three Months Ended September 30, 2025 Service Center

Innovative Pumping Solutions

Supply Chain Services

Total Reportable Segments

$ 350,179 $ 100,551 $ 62,994 $ 513,724 $ — $ 513,724

Operating expenses

296,817 81,147 57,635 435,599 — 435,599

Other expenses

Depreciation 995 774 8 1,777 1,034 2,811

Amortization of finance lease assets

1,021 231 47 1,299 443 1,742

— — — — 29,874 29,874

Operating income (loss) $ 51,346 $ 18,399 $ 5,304 $ 75,049 $ ( 31,351 ) $ 43,698

Interest expense — — — — 14,894 14,894

Other income, net — — — — ( 648 ) ( 648 )

Income (loss) before income taxes $ 51,346 $ 18,399 $ 5,304 $ 75,049 $ ( 45,597 ) $ 29,452

Capital expenditures 936 $ 1,082 $ — 2,018 $ 4,722 $ 6,740

Other primarily includes selling, general and administrative expenses of $ 24.5 million and amortization of intangible assets of $ 5.4 million.

Three Months Ended September 30, 2024 Service Center

Innovative Pumping Solutions

Supply Chain Services

Total Reportable Segments

$ 316,831 $ 89,825 $ 66,279 $ 472,935 $ — $ 472,935

Operating expenses

269,034 70,614 60,671 400,319 — 400,319

Other expenses

Depreciation 807 848 8 1,663 702 2,365

Amortization of finance lease assets

835 156 32 1,023 87 1,110

— — — — 29,533 29,533

Operating income (loss) $ 46,155 $ 18,207 $ 5,568 $ 69,930 $ ( 30,322 ) $ 39,608

Interest expense — — — — 15,716 15,716

Other income, net — — — — 160 160

Income (loss) before income taxes $ 46,155 $ 18,207 $ 5,568 $ 69,930 $ ( 46,198 ) $ 23,732

Capital expenditures $ 1,034 $ 920 $ — $ 1,954 $ 2,000 $ 3,954

Other primarily includes selling, general and administrative expenses of $ 24.3 million and amortization of intangible assets of $ 5.2 million.

Nine Months Ended September 30, 2025 Service Center

Three Months Ended March 31, 2026 Service Center

Innovative Pumping Solutions

15 unchanged sentences

Other primarily includes selling, general and administrative expenses of $ 27.1 million and amortization of intangible assets of $ 7.0 million.

Nine Months Ended September 30, 2024 Service Center

Three Months Ended March 31, 2025 Service Center

Innovative Pumping Solutions

16 unchanged sentences

The following table sets forth total assets related to the Company's segments ( in thousands ):

September 30, 2025 December 31, 2024

March 31, 2026 December 31, 2025

Service Centers $ 832,375 $ 820,289

12 unchanged sentences

Final determination of the fair values may result in further adjustments.

During the first quarter of 2025, the Company acquired one business for a total of $ 13.0 million.

The Company acquired this business to expand its platforms and to maintain its leading position as the largest distributor of rotating equipment in North America.

During the second quarter of 2025, the Company acquired one business for a total of $ 1.0 million.

The Company acquired this business to expand its geographic coverage and to maintain its leading position as the largest distributor of rotating equipment in North America.

During the third quarter of 2025, the Company acquired one business for a total of $ 11.6 million.

The Company acquired this business to expand its end markets and enhance a geographic region in order to maintain its leading position as the largest distributor of rotating equipment in North America.

A summary of the preliminary allocation of the total purchase consideration of our business acquisition during the nine months ended September 30, 2025 is presented as follows ( in thousands ):

Q1 2025 Q2 2025 Q3 2025 Total

Total Acquisitions 1 1 1 3

During the first quarter of 2026, the Company acquired three businesses for a total of $ 126.3 million.

The Company acquired these businesses to expand its platforms and to maintain its leading position as the largest distributor of rotating equipment in North America.

A summary of the preliminary allocation of the total purchase consideration of our business acquisition during the three months ended March 31, 2026 is presented as follows ( in thousands ):

Acquisition 1

Cash payments $ 86,959 $ 21,982 $ 108,941

Contingent consideration

13,843 3,499 17,342

Total purchase price consideration $ 100,802 $ 25,481 $ 126,283

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Goodwill $ 42,386 $ 13,900 $ 56,286

The total purchase consideration related to our acquisitions for the nine months ended September 30, 2025 consisted primarily of cash consideration.

The total purchase consideration related to our acquisitions for the three months ended March 31, 2026 consisted primarily of cash consideration.

The total cash and cash equivalents acquired for these acquisitions was $ 6.2 million.

Transaction-related costs included within selling, general, and administrative expenses in the consolidated statements of operations was $ 1.0 million for the nine months ended September 30, 2025.

The goodwill total of approximately $ 12.2 million for the nine months ended September 30, 2025 assigned to our SC segment was primarily attributable to expected synergies and the assembled workforce of the entities.

Transaction-related costs for acquisitions consummated during the period and included within selling, general, and administrative expenses in the consolidated statements of operations was $ 0.8 million as of March 31, 2026.

The goodwill total of approximately $ 56.3 million for the three months ended March 31, 2026 assigned to our IPS segment was primarily attributable to expected synergies and the assembled workforce of the entities.

The total amount of goodwill expected to be deductible for tax purposes is $ 52.5 million.

The acquisitions' operating results are included within the Company's consolidated statements of operations from the date of acquisition, which were not material for the nine months ended September 30, 2025.

The acquisitions' operating results are included within the Company's consolidated statements of operations from the date of acquisition, which were not material for the three months ended March 31, 2026.

Pro forma results of operations information have not been presented, as the effects of the acquisitions were not material to our financial results.

Of the $ 5.8 million of acquired intangible assets, $ 0.3 million was provisionally assigned to non-compete agreements that are subject to amortization over 5 years, and $ 5.5 million was assigned to customer relationships and will be amortized over a period of 8 years.

Of the $ 48.5 million of acquired intangible assets, $ 0.3 million was provisionally assigned to non-compete agreements that are subject to amortization over 5 years, $ 29.7 million was assigned to customer relationships and will be amortized over a period of 8 years, $ 6.9 million was assigned to trade names and will be amortized over a period of 10 years, and $ 11.6 million was assigned to dealer relationships and will be amortized over a period of 9 years.

NOTE 13 - SHARE REPURCHASES

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Total consideration paid to repurchase the shares was recorded in shareholders’ equity as treasury stock.

The following table represents total number of shares purchased, the amount paid, and the average price paid per share under share repurchase programs authorized by our Board of Directors:

Three Months Ended September 30, Nine Months Ended September 30,

(in thousands, except per share data)

2025 2024 2025 2024

Total number of shares purchased 19.2 100.0 19.2 565.8

Amount paid $ 1,999 $ 4,985 $ 1,999 $ 28,783

Average price paid per share $ 104.18 $ 49.85 $ 104.18 $ 50.87

There were no shares repurchased under the new Share Repurchase Program for the three months ended March 31, 2026 and 2025, respectively.

NOTE 14 - SUPPLEMENTAL CASH FLOW INFORMATION

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands)

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Treasury shares repurchase accruals

$ ( 28 ) $ 225

NOTE 15 - OTHER INCOME AND EXPENSES

The components of other (income) expense were as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands)

2025 2024 2025 2024

Interest income $ ( 1,258 ) $ ( 1,032 )

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As such, we believe this information is important in depicting the nature, timing and uncertainty of our contracts with customers.

The following Geographical Information and Note 11 - Segment Reporting present our revenue disaggregated by source.

The following Geographical Information and Note 11 - Segment Reporting presents our disaggregated revenues.

Geographical Information

1 unchanged sentence

The Company’s revenues by geographical location are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2026 2025

1 unchanged sentence

Canada 15,956 18,988

339 391 1,129 1,863

Total $ 521,658 $ 476,569

2 unchanged sentences

"Acquisition Sales" are sales from acquisitions that have been under our ownership for less than twelve months and are excluded in our calculation of Organic Sales.

The following tables sets forth the disaggregation of revenue from sales associated with recent acquisitions for the three and nine months ended September 30, 2025 and 2024 (in thousands) :

Sales Acquisition Sales Organic Sales

Three Months Ended September 30, 2025

Service Centers $ 350,179 $ 11,658 $ 338,521

Innovative Pumping Solutions 100,551 6,745 93,806

Supply Chain Services 62,994 — 62,994

Total Sales $ 513,724 $ 18,403 $ 495,321

Three Months Ended September 30, 2024

Service Centers $ 316,831 $ 12,969 $ 303,862

Innovative Pumping Solutions 89,825 15,566 74,259

Supply Chain Services 66,279 — 66,279

Total Sales $ 472,935 $ 28,535 $ 444,400

Service Centers $ 33,348 $ ( 1,311 ) $ 34,659

Innovative Pumping Solutions 10,726 ( 8,821 ) 19,547

Supply Chain Services ( 3,285 ) — ( 3,285 )

Total $ Change $ 40,789 $ ( 10,132 ) $ 50,921

Service Centers 10.5 % ( 10.1 ) % 11.4 %

Innovative Pumping Solutions 11.9 % ( 56.7 ) % 26.3 %

Supply Chain Services ( 5.0 ) % N/A ( 5.0 ) %

Total % Change 8.6 % ( 35.5 ) % 11.5 %

The following tables sets forth the disaggregation of sales associated with Acquisition and Organic sales for the three months ended March 31, 2026 and 2025 (in thousands) :

Sales Acquisition Sales Organic Sales

Nine Months Ended September 30, 2025

Three Months Ended March 31, 2026

Service Centers $ 337,976 $ 5,711 $ 332,265

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Total Sales $ 521,658 $ 40,745 $ 480,913

Nine Months Ended September 30, 2024

Three Months Ended March 31, 2025

Service Centers $ 327,075 $ 17,941 $ 309,134

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Total % Change 9.5 % 31.0 % 8.0 %

NOTE 17 - SUBSEQUENT EVENT

On October 1, 2025, the Company completed the acquisition of APSCO, LLC.

The acquisition was funded with cash on the balance sheet.

On November 1, 2025, the Company completed the acquisition of Triangle Pump & Equipment, Inc.

The acquisition was funded with cash on the balance sheet.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements