The acquisitions are aligned with DXP’s strategy to diversify product offerings, expand into new industries like water and industrial markets, and increase geographical presence.
Management emphasizes that acquisitions are well-run and growing, with no hesitation from customers or macroeconomic factors impacting deal flow.
The company’s focus on acquisitions is also driven by the desire to leverage operational efficiencies and expand its technical expertise, especially in high-margin segments.
Adjusted EBITDA was $49 million, down 24% year-over-year, with a margin of 21.5%, a decrease of approximately 450 basis points due to lower volumes and sales mix.
Adjusted net income was $28.2 million, down 21.9%, with adjusted EPS of $0.20.
Capital expenditures totaled $6.8 million, and net leverage was 2.3x, within the target range.
Cash from operations was $51.4 million and free cash flow was $44.6 million, representing a 211% free cash flow conversion of adjusted net income on a trailing 12-month basis.
Commercial and Other segment revenue grew 6.7%, including contributions from the TMC acquisition and organic growth in rolling steel doors, carports, and sheds.
International segment revenue increased 58% to $28.4 million, driven by recovery from prior recessionary impacts.
Janus International Group reported Q2 2025 revenue of $228.1 million, down 8.2% year-over-year, primarily due to a 14.8% decline in self-storage new construction and R3 sales channels.
Adjusted EBITDA declined 15% to $174 million, with adjusted EBITDA margin falling to 9.5% from 10.7% a year ago due to pricing and cost pressures as well as lower volumes.
Capital expenditures totaled $130 million, with $48 million in maintenance CapEx and $82 million in expansionary CapEx focused on capacity expansion, geographic growth, and automation.
Construction segment sales declined 4% to $552 million with a 6% decline in selling prices partially offset by a 2% increase in units; operating profits declined by $16 million.
Earnings per share for the quarter were $1.70.
Gross profits declined due to lower volumes, higher material and manufacturing costs, and operational challenges, especially in site-built and composite decking businesses.
Net sales for Q2 2025 were $1.8 billion, down 3.5% from $1.9 billion last year, driven by a 3% decline in units and a 1% decline in pricing with recent acquisitions providing a modest offset.
Operating cash flow was $113 million for the quarter, including a seasonal net working capital increase of $166 million expected to convert to cash by end of Q3.
Packaging segment sales declined 2% to $429 million with a 4% decrease in selling prices and 2% unit growth from acquisitions; operating profits declined by $3 million.
Retail segment sales declined 3% due to a 7% decline in unit sales offset by a 4% increase in price; operating profits declined by $6 million.
The company returned capital to shareholders through $42 million in dividends and $261 million in share repurchases.
Progress and Strategic Significance of Aluminum Flat-Roll Launch
First commercial shipment of aluminum flat-rolled coils on June 16, 2025, marking a major milestone.
Expectations to reach EBITDA breakeven before the end of 2025, with ramp-up to full capacity in 2026.
Market environment has become more favorable due to a domestic supply deficit of over 1.4 million tonnes, with tariffs making imports more expensive.
Customer interest is high, with robust engagement from automotive and beverage can sectors.
The project leverages SDI's construction expertise, with a focus on low-cost, high-efficiency operations, and aims to capture market share in a significant domestic deficit.
The company anticipates exiting 2025 at 40-50% utilization, reaching 75% in 2026, with a focus on product certification and ramp-up.
Dafinchi
