Distribution Solutions Group reported higher third-quarter revenue on steady organic growth and contributions from recent acquisitions, while net income declined from a year earlier, which included a sizable non-recurring tax benefit.
For the quarter ending Sept. 30, revenue rose 10.7% to $517.96 million from $468.02 million a year earlier. GAAP net income was $6.45 million, down 70.6% from $21.92 million. Organic average daily sales increased 6.0%.
Year to date, revenue reached $1.498 billion, up 13.2% from $1.324 billion in the first nine months of 2024. GAAP net income for the nine months was $14.72 million, a 20.9% decline from $18.59 million a year earlier.
CEO Bryan King said the quarter “demonstrate[s] the strength and resilience of our business model,” citing 10.7% revenue growth and 6.0% organic average daily sales, with sales gains across all segments and “particularly strong” results at Gexpro Services and the Canada Branch Division. He added that, after four straight quarters of sequential organic growth, DSG enters the fourth quarter “with solid momentum and confidence in our growth strategy.”
Operating cash flow was $38.4 million in the quarter. The company ended September with no revolver borrowings and $335.4 million in total liquidity, including $82.7 million in cash.
Looking ahead, King said DSG is maintaining a cautious stance for the fourth quarter given tougher comparisons and economic uncertainty, while emphasizing balance-sheet flexibility to pursue acquisitions.
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