Distribution Solutions Group, Inc. — Call Transcript 2026

Greetings. Welcome to the Distribution Solutions Group Fourth Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Sandy Martin. You may begin. Good morning, welcome to the Distribution Solutions Group's fourth quarter and full-year 2025 earnings call. Joining me on today's call are DSG's Chairman and Chief Executive Officer, Bryan King, and Executive Vice President and Chief Financial Officer, Ron Knutson. In conjunction with today's call, we have provided a financial results slide deck posted on the company's IR website at investor.distributionsolutionsgroup.com. Please note that statements on this call and in today's press release contain forward-looking statements concerning goals, beliefs, expectations, strategies, plans, future operating results and underlying assumptions subject to risk and uncertainties that could cause actual results to differ materially from those described. In addition, statements made during this call are based on the company's views as of today. The company anticipates that future developments may cause those views to change, and we may elect to update the forward-looking statements made today, but we disclaim any obligation to do so. Management will also refer to certain non-GAAP measures, and the reconciliation to the nearest GAAP measures are available at the end of our earnings release. The earnings release issued earlier today was posted on our investor relations website. A copy of the release has also been included in a current report on Form 8-K filed with the SEC. Lastly, this call is being webcast live on DSG's investor relations website, and a replay will be available through March 19th. I will now turn the call over to Bryan King. Bryan? Thanks, Sandy. Good morning, everyone, and thank you for joining us. As events unfold in the Middle East, we are actively assessing any potential implications for our business, our customers, and impact on the broader supply chain. Our thoughts and prayers are with the military personnel and civilians who are in harm's way and with their families. We will continue to monitor the potential implications for global markets and are committed to operating with resilience, discipline, and care during this period of elevated uncertainty. We are not where we wanna be at the end of the quarter, but our confidence and vision for the future remain strong. 2025 was a critical, internally focused reinvestment, retooling, and digesting year for DSG, as well as one where we managed through some dynamic pricing and supply chain and numerous one-time cost curveballs. While it was at time a dizzyingly dynamic year through our daily North Star commitment to staying focused on investing in the business with a lens on long-term value creation, our urgency to offset shifting rules in the marketplace sharpened our focus on core fundamentals of building a better DSG. Enhanced focus on execution tools and talent on timely accountability across the organization and made us prioritize not delaying targeted significant investments in capabilities and talent to position the company for long-term success. As a result, we go into 2026 with an enhanced perspective on our competitive positioning and long-term levers to drive performance across our North American and global platforms. As I reflected, we navigated challenging headwinds in 2025, including a government shutdown, shifting demand environment, and macroeconomic pressures and emotions, including those driven by fluid tariffs, where our diligent and largely effective efforts to recapture margin still left us short. Our financial results fell short of our expectations in the fourth quarter and for the year, and we own that. However, besides progress in our transformative investments, we enjoyed consistent operational affirmations in the marketplace around our value-added lines of business. Our teams delivered important new business and wallet share wins in each vertical, held on to business on the back of service and capabilities, and made meaningful progress in our customer-facing capabilities and partnerships in 2025. We leaned in on improved discipline, heightened institutional adaptability, and enhanced DSG's more broadly presented and refined value-added solutions as confirmed by the marketplace, all of which add up to real 2025 successes and maturity of the business that will make us stronger in the longer term. Turning to slide four. For the full- year, we delivered total revenue growth of 9.8% on one less selling day, resulting in $1.98 billion in annual revenue. Organic average daily sales grew by 3.6%, reflecting solid underlying execution. Cash flows in 2025 were strong. We generated $84 million of cash from operations on top of $56 million in 2024. Adjusted EBITDA finished at $175 million, short of our expectations. These results demonstrate our continued focus on cash generation, working capital efficiency, and profitability. Throughout the year, demand remained healthy across aerospace and defense, semiconductor-related technology, renewables, and as the year progressed, industrial power. During the fourth quarter, we began to see demand soften in renewables in North America, which we are actively managing by pivoting growth initiatives in that sector towards the strong renewables demand growth for DSG's improved presentation of capabilities in the global marketplace. Expanding our efforts on other end markets where we enjoy exceptional customer partnerships and strong secular and strengthening cyclical momentum, such as in industrial power, technology, and aerospace and defense. Our expanded platform capabilities and ability to support our historic customers and similarly discerning customers on a more global stage are supporting and expanding an accelerating set of dialogues. As we've discussed on previous calls, our financial results will not be linear. The fourth quarter is a good example of that. These results are certainly not indicative of our long-term plans or confidence in the future. While we anticipate some quarter-to-quarter challenges to balance earnings with our recent commitment to accelerate our talent recruitment, transitions, and accelerated investments, we are committed to making decisions that prioritize driving a stronger and more profitable DSG in the longer term for all of our committed stakeholders. Recognize, like in this quarter, that the timing of some of those decisions unintentionally lined up with some margin near-term pressure and taxed near-term earnings more than leadership expected. While we didn't want to delay investments and talent decisions to unnaturally smooth earnings at the expense of building a better company, our leadership team still expects much better profitability performance from our DSG platform of capabilities. Let's turn to slide five to discuss our business initiatives. Gexpro Services delivered outstanding operating results in 2025, driven by the strength of the aerospace and defense, technology, and renewables end markets we serve. Despite some fourth quarter sales softness, full-year organic average daily sales increased 12.3%, with full-year ADS up 13%. We continue to invest in the technology and industrial power end markets, driven by expanding infrastructure needs and increasing AI-driven demand. Our order backlog and new business pipeline remains strong in both segments. While renewables slowed in North America in the second half of 2025, we shifted our investment focus towards global strategies with the encouragement of exceptional partners across technology, industrial power, aerospace and defense, and the power generation cycle. We are seeing a meaningful growth opportunity in India, while Southeast Asia is progressing more gradually due to the timing of customer qualifications. Both regions remain relatively small today, continue to show an excellent acceleration in prospective and current customer engagement across more of our proven value-added capabilities at DSG and Gexpro Services. Our European business remains strong, with increasing diversification across multiple verticals. Gexpro Services is also expanding its value-added service offerings using robotic automation and AI-enabled tools that enhance customer capabilities across VMI, kitting, manufacturing, and e-commerce solutions. Since bringing DSG together, Gexpro Services went from approximately $350 million in revenue to just under $500 million, mostly organically. Adjusted EBITDA has expanded from approximately $35 million to $64 million in 2025, with margins expanding nearly 300 basis points to 12.8%. This margin expansion reflects scale, broader geographic reach, enhanced value-added capabilities, and disciplined execution of operational efficiencies that leverage our cost structure. As we confidently lean into further investment at Gexpro Services, we are balancing strong optimism around marketplace pull on us to support growth opportunities with an expectation to drive earnings growth while making the important long-term investments in capabilities, geographies, and talent to support performing for our customers at a level that adds to the reasons we are winning wallet share and new mandates. As a reminder, Gexpro Services launching new customer programs requires upfront investment of significant time and margin, but results in exceptionally sticky customer engagements where we are critical to our customers, and our commitment to doing our job for them thoughtfully and exceptionally reaffirms the partnership between us and our customers. The upfront effort and investment can cause a bit of deleveraging of profits in any given quarter as programs ramp up or mature programs slow, like the shift we felt on the margin in the fourth quarter as new programs in global renewables come on but domestic programs slow, or as we felt a year or so ago in technology. The great news is that the new business pipeline continues to expand even as mature programs may fluctuate based on each customer's program momentum. We also continue to win significant wallet share. We rarely lose programs, and expanding what Gexpro Services does as a part of DSG allows us to expand our engagement with our customers. Gexpro Services continues to be one of the most exciting growth levers for DSG. Looking ahead, we are excited and focused on investing even more deliberately in additional organic and inorganic initiatives to sustain and extend the strong long-term momentum we see at Gexpro Services. Next, Lawson Products. Average daily sales increased 2.7% in the fourth quarter, continuing the momentum from the third quarter, when average daily sales grew by 3%. Although new VMI installations and wallet share expansions led to organic sales growth throughout the second half of 2025, Lawson's smaller account local revenue continued to be challenged in the fourth quarter as some of the sales force and selling tools transformation over the last couple of years have distracted our resources from doing the exceptional job our customers champion from our unique service model and that we expect. Lots of focus and tools, teamed with additional investment in talent and process improvements, are focused on getting this right for our customers, sales team, and for DSG. EBITDA margins were negatively impacted by a slight customer mix shift, deliberate strategic investments, and an unexpectedly elevated healthcare benefit cost in the quarter and for the full-year, which Ron will discuss in more detail in a moment. Recently, Lawson has made strategic investments in two leadership roles to strengthen the team through more capabilities and accountability. We brought on Jim Slomka as Chief Revenue Officer and Hillary Bryant as Chief People Officer. Jim joined Lawson Products in January 2026 and brings a proven track record of commercial transformation, having led sales and operations for a $1.8 billion omnichannel enterprise, overseeing more than 2,000 sales professionals, delivering a six-year sales CAGR of 8% and expanding gross margins by 300 basis points. He brings strong discipline around accountability, urgency, process, and commitments to a team-focused enthusiasm for excellence and winning, all consistent with being a former West Point athlete and officer. We are thrilled to welcome Jim to Lawson Products and DSG and are confident on the immediate impact he will have on the organization. Hillary brings deep global HR leadership experience, most recently managing a worldwide HR organization for a $1.4 billion industrial technologies company with approximately 4,000 employees. She offers a great complement to Jim, bringing a renewed discipline and energy to employee engagement and corporate culture while elevating a clear cadence around growth-focused expectation, urgency, and rewards. These important investments, alongside others that have also been recruited over the last years, put in place critical pieces to now have a stronger ensemble of experienced, been-there-done-that leadership and collectively add meaningfully to our sales and operating foundation as we pursue improved growth and execution in 2026. Turning to our 2026 growth priorities. We are focused on continuing to capture market share and expanding wallet share for our national accounts, including Lawson, Kent, and Government, while reestablishing our commitment to offering the highest level of consistent service out of our sales force for our customers. With that, a return to growth out of our smaller local accounts driven by their efforts and the investment we have made in them. A key leading indicator of our growth is in new VMI installations, or internally what we refer to as ship-to locations, which we are currently ramping up after a challenging couple of years as we've been working through our sales force transformation. We continue to leverage technology to increase sales effectiveness and are improving the rigor and consistency of sales rep activity supported by our CRM tool, enhanced training commitment for new FSRs, and a real focus on our DSMs consistent cadence with our established FSRs around driving growth and consistency in the customer experience. We are also in the early stages of rolling out across our field customer-facing team, a route optimization tool that we have been developing that will give them back expensive and frustrating transit time and more of an opportunity to serve and grow our customers. Although a smaller piece of our business, our e-commerce channel continues to deliver double-digit growth, and we are encouraged that more than 30% of customers purchasing through the site are new to Lawson. As we move forward, we remain focused on commercial excellence, the customer experience, and technology to accelerate growth and continuously improve how we serve our customers while also providing flexibility to our customers. Additionally, we are working more closely with our vendor partners to deliver solutions to our customers and to support our commercial team. At our recent sales leadership meeting in February, approximately 50 vendors presented their products and services to our sales team. We are working with a number of those channel partners to improve our product costs as we have in turn invested to support them and our customers with our significant recent investments in our selling and servicing capabilities. We expect some nice progress this year out of our sourcing partnerships. Moving on to the Canadian branch division. The team made solid operational and synergy progress in the 4th quarter and across the full-year, despite macroeconomic headwinds and tariff-related uncertainty that pressured industrial end markets, especially in Canada, throughout 2025. As expected, 4th quarter revenue declined sequentially due to typical holiday season softness and weather, leading to operational deleverage. In 2025, we completed four facility consolidations, with the final consolidation expected by the end of the 1st quarter. As we discussed last quarter, because Source Atlantic's purchase price was largely tied to tangible assets, our first full-year of transformation has meaningfully de-risked this investment for us, and we continue to believe this was a strong strategic acquisition to grow and scale our Canadian operations. Although the revenue headwind out of the gate has us a full-year behind our ambitious profitability objectives our DSG team embraced when we acquired Source Atlantic in late 2024. More recently, the recruited Canadian leadership team reaffirmed that underwriting. While there is still significant profitability tuning work ahead, we are encouraged by our framework in expanding profitability, insights, and discipline that we are building, the team we put in place, and the path and significant progress they are demonstrating to us in the marketplace as the first year of ownership is now closed. At the TestEquity Group, we are investing at a renewed feverish pace in the long-term platform we can better see now in this vertical. A massive investment in additional leadership capabilities and tools were made in the business, especially during the last part of 2025. A shift was made concurrent with these investments around dialing up a more intense focus and intentional allocation of resources towards driving a structurally higher margin shift discipline out of a daily cadence around the vertical's growth priorities. Each team member owns specific accountability on discrete levers to impact that outcome. When we committed to these investments, we fully expected a J-curve recovery, with near-term transitions impacting performance, followed by improved revenue growth and profitability as our strategic initiatives take hold. For the full-year, average daily sales increased 2%, organic daily sales grew 1%, driven primarily by test and measurement, rentals, and chambers. In the fourth quarter, revenue grew 0.9% on one additional selling day, supported by continued momentum in rental and refurb chambers and TestEquity. While test and measurement end markets were under pressure in the fourth quarter, we remain focused on disciplined execution of our growth and profitability prioritization initiatives and are beginning to see the tighter strategic lens and accelerated pacing around cadence and accountability at work. The result is we are seeing engagement deep into the organization take place, and the affirming pipeline activity evolving towards our areas of most differentiated capabilities, teamed with our higher margins and return on capital opportunities, including value-added solutions used in rental, Test and Measurement solutions, chambers, and accelerating the growth and mix around our most value-added elements of our electronic production supply offering to strengthen our margins and earnings. We are currently seeing some accelerating customer engagement building around our core Test and Measurement expertise, where we have reinforced with a renewed and discrete effort around rededicating resources focused on T&M customer solutions, selling, improve our competitive moat at a time when we believe the marketplace has passed the trough and we are seeing acceleration. We also have major initiatives underway to simplify and unify the digital ecosystem. Enhancing the customer experience through ERP consolidation, customer service, and e-commerce platform integration is foundational to our strategy, and we are actively leveraging AI applications to accelerate execution. At the same time, we are strengthening performance management, incentives, and accountability as we establish new key leadership roles. We're excited about the progress Barry is making to drive a much more disciplined approach to the portfolio of value-added capabilities and products offered across the TestEquity Group vertical. For the employees, we appreciate their support of his accelerated operational pace and accountability, including the shifting of time and resources towards more differentiated growth areas to drive his objectives around mix shift rather than only adding incremental costs in elevated areas of focus. Looking ahead, we are actively increasing our account base and deepening penetration among our existing customers while using new product introductions and private label offerings to expand customer choice and enhance margins. Encouragingly, a growing backlog in January and February of 2026 signals momentum to come in 2026. We recognize that the full impact of these initiatives typically takes several quarters, but we are confident they will result in a structurally stronger, more competitive, materially higher margin TestEquity business over time. With that, I'll turn it over to Ron for details on our fourth quarter and full-year financials. Ron? Thank you, Bryan, and good morning, everyone. Turning to slide six and starting with our full-year results for 2025. As Bryan mentioned, consolidated revenues for the year were $1.98 billion, up 9.8% compared to 2024. Incremental revenue from our 2024 acquisitions was $121.5 million, and our organic average daily sales growth for the fiscal year was up 3.6% over 2024. For the year, Adjusted EBITDA was $175.2 million or 8.9% of sales, and GAAP net income per diluted share was $0.18 for the year versus a GAAP net loss per diluted share of $0.16 a year ago. Non-GAAP adjusted EPS was $1.24 for the year compared to $1.44 per share a year ago. full-year margins in 2025 were 80 basis points lower than in 2024, primarily due to sales mix shifts, employee-related costs, and other investments. Fourth quarter revenues were $482 million, up 0.2% versus a year ago, which translated into flat organic sales compared to the fourth quarter of 2024. For the quarter, we generated Adjusted EBITDA of $35.4 million or 7.4% of sales. Each of our businesses experienced lower year-over-year EBITDA margins, primarily due to sales mix shifts, some incremental bad debt expense, and higher health employee-related costs, namely healthcare benefits. Cash flow from operations was strong, with $16.9 million for the quarter and $84 million for the full-year on top of strong results in 2024. Before I move on to the individual verticals, I wanted to comment briefly on the DSG consolidated margin for the full-year and for the quarter. For the full-year, Adjusted EBITDA was 8.9% compared to 9.7% for the full-year 2024. I would break the 80 bips compression into two buckets. The first is primarily longer-term people investments of approximately 20 bips. The remaining 70 bips was driven by timing items and non-recurring items such as healthcare costs, specific customer bad debt reserves, and some lower margin to win specific customers. From a timing perspective, many of these items hit in the fourth quarter, resulting in a larger impact on our fourth quarter margins of 7.4%. Longer-term people investments impacted the quarter by approximately 25 bips. Other items impacting the quarter that we would classify as timing or non-recurring include healthcare, approximately 40 bips, customer specific bad debt, approximately 20 bips. Recruiting and leadership startup approximately 25 bps, mix shifts within Gexpro Services approximately 25 bps, and timing benefits realized in the fourth quarter of 2024, which was about 40 bps. Moving on to slide seven and starting with Lawson. With Lawson, full-year revenue increased $12 million, average daily sales grew by 2.6%, and organic average daily sales declined by 1.2%, primarily due to lower military customer sales. Adjusted EBITDA for the year was $51.6 million or 10.7% of revenues for the full-year. For the quarter, Lawson's average daily sales were up 2.7% and its Adjusted EBITDA was $7.7 million or 6.7% of sales. In the Lawson-based business, the margin compression from the prior year was primarily due to sales mix of about 60 bps, higher health employee-related benefit costs of approximately 100 bps, and employee costs and timing of incentive accruals of approximately 110 bps. As Bryan mentioned, Lawson's most significant sales initiatives focus on new VMI installations and increased share of wallet, which are leading indicators of revenue growth. We are continuing to accelerate the adoption of our CRM platform to improve sales rep productivity, grow the core business, and are currently in the early stages of route optimization planning. We are also expanding our e-commerce platform. This is a cost-effective way to do business, and 1/3 of our customers on the site are new. Although sales are still small on e-commerce, we experienced about an 18% revenue growth in the fourth quarter. Turning to slide eight, full-year sales for the Canadian segment were $221.4 million in USD, up $96.3 million, primarily due to the Source Atlantic acquisition included for a partial year in 2024. Fourth quarter sales for the Canadian segment in USD were $55.1 million, reflecting some seasonal softness. Market softness for projects in manufacturing end markets persisted, mostly in Eastern Canada. However, current backlogs have increased meaningfully. full-year Adjusted EBITDA was $15.6 million or 7.1% of sales, while fourth quarter margins were 6.6%. Margins were compressed slightly due to items such as first-year Sarbanes-Oxley compliance work. The Bolt Supply standalone business drove sales by 7.8% in local currency and generated a 14% margin for the full-year. We continue to make progress on planned synergies around gross margins and branch consolidations between Bolt and Source Atlantic. Turning to Gexpro Services on slide nine full-year revenue was $496.7 million, representing organic average daily sales growth of 12.3% and total ADS growth of over 13%, driven primarily by end market strength in aerospace and defense, technology, and renewables for most of the year. Recall that we highlighted tougher sales comps in the fourth quarter, which declined 1% on an average daily sales basis, generating $119.4 million. full-year Adjusted EBITDA was $63.7 million or 12.8% of sales. For the quarter, margins pulled back to 11.7% from 13.3% a year ago on a lower Q4 sales base, a sales mix on lower renewables, and some strategic employee investments. Value creation initiatives for Gexpro Services continue to include DSG cross-selling, acquisition synergies, and expanded VMI kitting, manufacturing, and e-commerce offerings. Lastly, I'll turn to TestEquity Group on slide 10. full-year sales were $783.2 million, with average daily sales growth of 2%, driven primarily by test and measurement, rentals, and our chambers business. Organic average daily sales for the year were up 1%. Fourth quarter sales were $192.9 million, with average daily sales up 0.9% versus a year ago. TestEquity's Adjusted EBITDA for the year was $51 million, with Adjusted EBITDA margins of 6.5% versus 7.3% for all of 2024. Margins were pressured by a sales mix shift, higher bad debt expense, and higher employee-related expenses, including the build-out of the leadership team and non-recurring favorable items from a year ago. Fourth quarter EBITDA margins were similar as full-year margins at 6.4% of sales. The new leadership team has aligned priorities through performance management, incentives, and accountability. Moving to page 11, we ended the year with total available liquidity of $469 million. For 2025, our free cash flow conversion, defined as Adjusted EBITDA less working capital investment, less CapEx, was approximately 85%. In December 2025, we expanded our senior secured credit facility through 2030. The new facility includes $700 million of term debt and a $400 million revolving credit arrangement, an increase over the previous $255 million revolver. This puts us in a strong liquidity position to best drive shareholder returns through our capital allocation playbook. We ended the year with unrestricted and restricted cash totaling $75.3 million and net debt leverage of 3.5 times. We continue to prioritize growth initiatives that enable cross-channel and collaborative selling across our customer base, expand our digital capabilities across our platform, and drive growth through an asset-light model. We invested $26.8 million in net CapEx, including rental equipment, and we plan to invest a similar amount of $25 million-$30 million in 2026. As we've highlighted in the past, we have invested nearly $450 million in M&A by acquiring nine highly complementary businesses to expand our portfolio, leverage scale, and grow through product adjacency and services. We closely manage working capital across our businesses, and net working capital was $473.5 million. As we mentioned, DSG generated $84 million of cash from operations for the year, similar to 2024 before retention payments, and a testament to management's close monitoring of our working capital. Our strong cash generation in 2025 positioned us to be more active in share repurchases. In November 2025, the board authorized an increase to our existing stock repurchase program for an additional $30 million in shares of DSG's common stock, taking the total aggregate authorization amount to $67.5 million. In 2025, we returned $23.5 million to our shareholders through opportunistic share repurchases and have approximately $33 million remaining in the authorized pool. I'll now turn the call back over to Bryan. Thank you, Ron. Despite external headwinds and periods of demand volatility in 2025, we have a clear line of sight on initiatives well underway to drive sales growth and structurally higher margins. We delivered total revenue growth of almost 10%, reaching just under $2 billion, supported by mid-single-digit organic growth despite the burden on profitability of macroeconomic and policy challenges and an ISM remaining below 50 for all of 2025 and our deliberate investments into the business in 2025. As we enter 2026, our focus is firmly on execution and demonstrating a return to improved profitability with our expected growth while balancing critical long-term value unlocking investments. Our revenue growth strategy prioritize high-margin businesses, strong and sustainable cash flow generation, disciplined capital allocation, and operational excellence. We are investing to be a company that is easy to work with and for leveraging digital and AI-enabled capabilities to respond faster to customer needs, improve operational efficiency, strengthen sales rigor, and capture margin opportunities. These efforts are supported by an accelerating level of data-driven insights that guide and improve decision-making and enable us to deliver our differentiated products and solutions while enhancing our customer experience. Operating across more than 50 countries, serving over 220,000 customers with approximately 760,000 unique products requires agility and focus. We remain nimble, ready to pivot when needed to sustain growth while focusing on delivering on improved profitability. Our leadership teams are renewing our confidence to shareholders and our colleagues that we are driving and expect growth with enhanced profitability and with a commitment to further tune capabilities and consistent service and culture that emphasizes from our field team around volume and revenue growth from both existing and new customers. I am confident in our enhanced leadership teams and our recent investments in them across all of our verticals and their ability to execute on their re-underwritten priorities and value creation initiatives as they enjoy line of sight on building structurally higher margin and more defensible and growing businesses with a commitment to generate strong free cash flow and an aligned incentive structure around driving accelerating long-term value for our shareholders. Our teams remain highly aligned with the shareholders and each other, collaborating and competing together to continue to win more often. Each is accountable and appropriately incentivized to deliver results for our shareholders and for DSG and all of our colleagues. We will continue to evaluate acquisitions that strategically fit and enhance our long-term competitive position to win in our current focus areas and markets or that complement them, as well as opportunities that can accelerate our growth and profitability objectives to enhance and accelerate driving long-term shareholder value. In addition to strengthening leadership within our verticals, after a thorough evaluation on ways to improve and enhance our corporate strategy and M&A capabilities, we recruited Sean Dwyer to lead DSG's efforts and dedicated team while working closely with the vertical leadership and our LKCM Headwater teams. Sean comes to us with a background in investment banking and experience leading similar efforts at large public companies. Through his public company roles, he has led over $30 billion in 36 transactions. It's great to have Sean on board to add structure, perspective, and to collaboratively lead this critical component of DSG's growth strategy. As we look ahead in 2026, we're excited about the added capabilities, discipline, and prioritization we've invested in across all our verticals. While most of this comes at a cost We're confident in these investments and in the improved performance returns the investments will deliver. While the first couple of months of 2026 have seen sales growth, we expect the first quarter to remain under margin pressure as we continue to digest initiatives, and then we expect to see an improved margin expansion trajectory consistent with our longer-term objectives as we move into the middle of the year. I'm proud of the heavy lifting from our colleagues and what it accomplished in 2025. As I reflect on where we are versus the much smaller and less evolved DSG that we pulled together four years ago, we remain focused building a better DSG on its many commercial growth initiatives and ongoing process and structure optimization. We celebrate working together to build a more valuable enterprise, one that consistently generates cash flow and long-term shareholder value. Finally, I wanna thank our employees for their dedication and hard work throughout the year. Your commitment and the strength of our culture have enabled meaningful progress across our strategic priorities. We will continue to push, test, and adapt as we improve long-term performance. I also wanna thank DSG's board, our shareholders, our shareholder partners, and the LKCM Headwater Team as we continue advancing our specialty distribution model together. And with that, operator, will you please open the line for questions? Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your phone at this time. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Your first question for today is from Tommy Moll with Stephens. Morning, Tommy. Morning. Yeah. Good morning, Bryan. How are you? Morning, Tommy. I'm all right. Thanks for the time. Bryan, I want to start on the comment you just made regarding the sales pacing year-to-date. I think I heard you say sales are up year-over-year in January and February. Maybe just can you confirm that? If you're able to give us the daily sales pacing and the number of selling days for the quarter, that would be appreciated as well. Yeah. Let me, I'm gonna let Ron do it. He's got them in front of him. Yeah, Tommy. Yeah, good morning, Tommy. This is Ron Knutson. Eamon. It's Tommy. Yeah. Ron. Hey, Tommy, it's on. Just to add some commentary around Bryan's notes relative to the first two months of the year. We have seen growth, you know, really, I would say I'd put it, you know, in the low single digits. You know, if we look at January, February versus a year ago, you know, ADS so far for the first two months, you know, kind of flattish versus Q4 but up against a year ago. We're seeing a little bit of pressure continue within our Canadian branch business that I think both Bryan and I commented on in our prepared remarks. The other, the other verticals or the other, you know, three pieces of business are seeing some growth here in the first couple of months. You know, relative to, I think the second part of your question was relative to number of days and so forth as 26 develops. On a quarter-over-quarter basis, it shifts a little bit just because of the kind of the waiting, and we've got Gexpro Services on a 4-4-5. But essentially, it's relatively consistent. First quarter of 26 has 63 selling days versus the first quarter of 25 having 63 as well. Tommy I just would add. Oh, is it Tommy? Who's he? I thought it's... I thought you said it was Eamon. I was like, "Wait a second." Tommy, what one of the things I was referencing when I said that was that we were it was on the TestEquity vertical, and that was that we were seeing some backlog build there in orders and, you know, kind of RFPs. Momentum on and it's really around the test and measurement side, which we've seen with as we've seen some messaging from the manufacturers about a little bit of accelerated activity in that space. I mean, January, quite, you know, transparently, I wasn't happy with the flow-through of, on profitability, relative to how we budgeted or what I expected. As the fourth quarter came together in the first month of the year, while we saw some revenue lift, we still suffered some of the same challenges of adding expenses around leadership and otherwise in the first month. We're seeing improvement on that, we believe in February and expect that again in March. The re-leveraging of our cost structure with the pickup in revenue. There just were some changeover expenses that, and some one-times and some things that created noises in the fourth quarter and in January. Yeah. Bryan, you anticipated my follow-up, which was on margin. You clarified your comment, maybe I could put a finer point on it here. Okay. If I go back. I got it. ... the numbers that Ron gave us in the prepared remarks, there were a series of one-timers in Q4. I just added up all those basis points, and it was about 150 basis points. My starting point on bridging was I just took, the 7.4 you reported in Q4 plus 150 gets you 8.9% as an implied baseline to start to think about the first quarter. That would be up a little bit year-over-year, though. Yeah ... based on what you just said, that makes me think perhaps that's a bit too aggressive of a, of a baseline. I don't know. It depends on the monthly assumptions. Anything you can do to tighten up expectations would help. Yeah, that number would be consistent with how margins flowed through for the year last year. When we look at it or when I look at it, the first quarter's still gonna have a little bit more margin degradation from our average last year, I think. Whereas the second and third quarters, we would expect that the EBITDA margin will be back towards above what last year's average was, if that's helpful. Yep. Is that right, Ron? Very much. I'm looking at you, Ron. Yeah. Yeah, that, yeah, that is, that is right. You might be able to say that better. Yeah. If, if I go back, Q1 of 2025, we were sitting at about 9%. Tommy, we typically, you know, we do get burdened with some other items that we didn't call out specifically in our comments, you know, around some, you know, payroll taxes start over on us. You know, that typically, you know, drags our margins a little bit even going from Q4 into Q1. The other area that I would point to is we do have some resetting of some incentive accruals and so forth. As you can imagine, you know, lower dollars in 2025 based upon performance. We certainly budget to hit higher goals, you know, going into the next year. We'll have to reestablish, you know, some of those accruals as we work throughout the year as well. Those typically get spread, you know, pretty evenly throughout the year until we, you know, start to reforecast to a greater degree, you know, later in the year. We do have some, what I would call, you know, kinda offsets, or, you know, negative items that'll probably push their way through here yet in the first quarter. I would say, Tommy, the exercise you did, which is the same one I did yesterday when I was preparing my remarks, by adding up Ron's remarks, which had were prepared ahead of mine. I did the same bridge you did, and then kinda tried to double-check it against looking at where we were for the quarter so far. Directionally, you're right on. I think it's just gonna be a little not quite. January is not indicating to me that we're gonna get to where you the level you said. Understood. Shifting to some more strategic questions here on TestEquity. Yeah. You have new leadership there, and you've talked before and again today about refining the customer value prop to go to market, centralizing some functions, et cetera. What can you share there about the progress to date and what's ahead in 2026? Look, the pacing on the team and the, and the, and the depth of our leadership, bench is, and is just very different than it has been. You know, part of that was, that we, you know, adding Barry was critical, but, you know, it was not just adding Barry. Barry brought with him, you know, an ensemble of other executives, we were able to really keep, you know, so many of the people that we had that were in, you know, had key, institutional knowledge and that we had a lot of confidence around. We did double up, you know, some of our leadership expense. When I look at the total burden at the top of that company, it's different than it was, four or five months ago. With that has come a real, you know, high level of, not only cadence is different and the pacing is different, but there's a high level of kinda drill-down insight, which, you know, Russ and Mark had been doing last year, increasingly for us. After we made the ConRes acquisition, you know, we were able to really get a lot more accountability around the efficiency in our rental and used business and our calibration strategy. Our chambers business has been taken off, and so we've been trying to build out our chambers offering and portfolio and our inventory and stock. Then we've been working through kind of a more cohesive strategy around the total tested measurement go-to-market, kinda value proposition to the customer, so it's not just as isolated to margins on new product. Then on top of that, we have a lot of smaller value-added capabilities that are inside of the TestEquity Group, some of which came with Hisco and some of which were ones that we'd acquired. So by breaking them each apart and really drilling accountability and ownership on each of those verticals, we're able to see very different contribution margins amongst different ones. You know, our, you know, of our EPS business, you know, we've got parts of it that are more commodity, that are volume, but our cost, our channel support to that is similar to our more discrete specialty parts of the same EPS business. The flow-through margin on those look quite a bit different. The team is really, you know, re-energizing the sales force on how they're spending their time and how we're delivering our messaging to the marketplace and to our employees around where the levers are to pull a lot more attention and acceleration through the parts of the business that have very different structural contribution margins. That's just... You know, that energy and that focus kinda started, you know, 100 days ago. It's trickling down through the organization, more recently. We, our chief commercial officer, who's been real important to the business, we made our president of Mexico for all of DSG so that we could start to really bring our cadence together across all three of our verticals, in Mexico so that we could have more cross-sell wins and drive total revenue growth. That's the business that he had built for Hisco. Then we added another chief commercial officer at the senior executive level, to really focus on these lines of business efforts. You know, it, Barry's got a lot of confidence in, all the specialty businesses that we have and how it all rolls together, and some of the profitability that is inside of that business has been masked by some of the areas that, have been whipping around or where we've, you know, either had too high cost to serve relative to the contribution margin and not enough focus on the areas with our sales force on much higher contribution margin opportunities. We're seeing that shift, so. Bryan, Ron, I'll turn it back and appreciate the insight. Thank you, Tommy. Appreciate your time. Thanks, bud. Your next question for today is from Ken Newman with KeyBanc. Hi, Ken. Hey, good morning, guys. Good morning, guys. Hey, this is Katie on for Jenny. Oh, hey, Ken. Hi, Ken Hey. I was wondering if we could start on tariffs and if you're anticipating any material impacts from the recent news and how you're thinking about price cost as we go into 2026? Yeah. Why don't you start that off? Yeah, I'll start it off. I know, I know we've talked about, you know, tariffs in the past, you know, relative to, you know, the value of the imports that we, that we do and so forth, and our ability, you know, to be able to pass along, you know, the majority of those, you know, from a, from a customer relationship standpoint. I think your question is probably more pointed towards the recent news and so forth. I would say probably too early to tell yet in terms of, you know, what direct impact, you know, that may or may not have on DSG. Certainly we're evaluating, you know, the situation, you know, trying to, trying to stay really current with it as others are as well. You know, at this point we're, you know, moving the business forward, you know, assuming that, you know, a lot of these costs that have come through to us, you know, the last, you know, call it 12-18 months, will probably continue to be out there, until we get some further direction on where this may end up. Ken we've got a consulting firm that we use, are using across our portfolio companies at LKCM Headwater, and we have some businesses that have been much more significantly impacted than DSG. It's allowed us to be informed, you know, across ways and levers that we should pull and also how to, you know, navigate or engage on those SCOTUS recent rulings. We ended up leaving some dollars on the table last year for sure, but our team did a great job of managing both pricing as well as sourcing costs and where we source things across DSG. So much of it was mitigated by the end of the year. You know, we did end up with certainly a drag on earnings or much of it was mitigated as we looked out perspectively for this year by actions that were taken throughout last year. Now we've got to kinda look and see whether or not there's any additional moves that we need to make or whether or not there's gonna be additional shifting in where the tariff burdens are gonna be, and whether or not that's gonna inform any of our sourcing decisions this year or pricing decisions this year or whether or not we're contesting or protesting that we believe that we should get any refund. Right now it's really early to try and know how that's gonna work. Okay. That's helpful. Just revisiting Tommy's question a little bit on some trends that we've seen year-to-date. Any other color that you're able to provide on the segments, and then maybe for Lawson specifically, you know, how are you thinking about these mixed impacts within that segment, and should those normalize as we move through the year? You know, I'll start with Gexpro Services. That one's pretty easy. You know, Gexpro Services has got several key end markets that are spooling up. The power generation space has obviously gotten a lot of attention. It's a key area for that business and its legacy or its history coming out of GE. It'll enjoy some leverage there to the positive. The aerospace and defense vertical is very important to it. We know what's going on around the world, so, you know, there's, you know, we expect a firm year there and with growth. The domestic renewables business, you know, we're about two-thirds domestic, one-third international historically. The domestic business is down. We really started to see it tick down in the fourth quarter, kind of mid fourth quarter, I guess. That trend is continuing. At the same time, as we're seeing, you know, countries like India, where we had $4 million of revenue on renewables, is kind of tracking towards. That's two years ago, kind of 2024, I think we were $4 million, is what I remember looking at, and this year will be 14. We're backfilling, you know, with our capabilities, with our manufacturing our vendor partners and some of the renewable developers, you know, programs around the world that are backfilling, but not entirely backfilling. There's also some different contribution margin dynamics as you spool up new relationships like Gexpro, as I alluded to, relative to, you know, the contribution margin on a more mature vertical or customer engagement. As we're taking on more opportunities at Gexpro Services, which is happening more broadly than just renewables, there's some launch costs that are associated with that. We do believe that Gexpro Services margins that we've seen throughout last year are consistent with how we think that business is kind of gonna continue to operate. We don't expect a, you know, a significant deterioration in the EBITDA margin at Gexpro Services this year at all. We think it's kind of operating without a lot of headroom up this year, but operating at a level that we think is about consistent with where we expect it'll be this year. On the TestEquity side or TestEquity side, as I alluded to earlier, we're seeing strong interest in the test and measurement equipment. Our apps business is continuing to see some softness. Our electronic production supplies, you know, one of the key areas is our electronic or tech manufacturing. Ron, help me with that. Is that. I'm kind of trying to remember how we call that vertical. The, you know, that has been an area that has been really soft for us and we've seen some firmness in it last year. I can't remember where our backlog looks right now there, but it's the biggest part of TestEquity Group's apps business. The Chambers business is very strong. The rental and used market is getting more attention or focus for us 'cause it has a lot higher contribution margin. It's been, you know, it was a source of strength last year and with renewed strength. Some of that's focus and some of that's the acceleration in demand in the input in markets on the test and measurement side. What else, Ron? Lawson? Yeah. That it? Yeah. relative to Lawson and, you know, what I would say around that is, we continue to see an increase in our, what we call ship-to or VMI installations, in particular in the, in our larger locations, you know, within, you know, strategic relationships, and within our Kent Automotive business. I would say a renewed focus on the core or local business, where, you know, historically, if you look at the last couple of years, that's where the most pressure is, has been seen. We've seen, I would say, kind of flattening out in ship-to's there. As Bryan mentioned, we had our sales leadership meeting in mid-February and a ton of focus being put on reallocating resources to be able to grow that piece of the business, which makes up that local business, we call it core as well, is about 45% of Lawson's total revenue. Again, Lawson is seen on an overall basis, some increase here, you know, moving from, you know, January, February. We've got great insight into number of locations and, you know, around specific customer wins, and the accountability that Bryan and I have mentioned around making sure that those sites get installed on a monthly basis, with Jim's, with Jim coming on board here in January, a renewed focus around that, making sure that we hit those numbers as well. Got it. That's it for me. Thanks. Thanks, Ken. Your next question for today is from Kevin Steinke with Barrington Research. Great. Thank you, and good morning. Morning, Kevin. Hey, Kevin. Hey, just wanted to follow up on the earlier margin discussion. I believe in response to one of the earlier questions, you mentioned that you thought the second and third quarter Adjusted EBITDA margin could be above the full-year 2025 average of 8.9%. You're thinking kind of a, you know, nine-ish, is appropriate for, you know, second and third quarters? I think we believe it's gonna be relevered up higher than that, Ron. Okay. I think that I'm trying to remember where we are around there, but if you look at last year, our second and third quarter EBITDA margins were above that 8.9%. I think we expect that it'll be consistent with that or above. Can you remember? Is that right, Ron? Yeah. Yeah. I think where we're gonna see probably the most pressure, as we've commented on is really here in the first quarter. Then you're correct, Bryan, you know, relative to second and third, would be an acceleration, you know, north of what we posted for the full-year. Typically that, you know, that's not unusual. I mean, typically, you know, for us, the second and the third quarters are typically the strongest quarters. In fact, you know, even that, you know, that uplift, you know, generally starts in March. You know, March can be one, it's a longer month, in terms of selling days, so we get some additional operating leverage there. Typically, you know, Q3, if you look back historically, Q3, Q2 and Q3 are typically the strongest uplift in sales as well as overall margin percentages. I just looked back at it, and last year's Q2 was 9.7%, and Q3 was 9.4%. Versus the 9% last year in the first quarter and the 7.4%. Right that we posted in the fourth quarter. That's kinda gives you some sense of how the quarters fit in together. I think we've got a good number of selling days in the... Is it in the second quarter, Ron, or is it March? I'm trying to remember. In March, there's, I think it's either 22 or 23 days in the month of March. Q2 and Q3 both have 64 selling days. Okay, great. Got it. That's helpful. Appreciate it. I wanted to also follow up on Lawson. You mentioned there some continuing challenges just in the small, you know, the small account side there, maybe, you know, some loss of focus as you've gone through this transition period. You know, I know you've been experimenting with various things there. I think that's to serve the small account customer base and with inside sales force or maybe some service reps who do the unpacking. Are those the sort of things you would still wanna continue to work on? I know you also mentioned e-commerce. Or is it just more kinda getting the actual sales rep back on site more frequently? I don't... Any more thoughts on kind of how you, kind of are approaching that dynamic? You just kinda wander through all of them, which is great. That's what I was gonna say, Bryan. All of the above. Ron and I are laughing or smiling because, you know, you're right. Yes. I would say that the shift to some tiny customers to that were too small to service with the cost to serve of having a rep go see them because their order flow dynamics and the size they're invoicing was too small to, you know, have somebody there unpacking and managing stuff. I think our inside sales group and our e-commerce efforts have really helped that. I think that our revenue there is not where we've really lost volumes. We may have lost some ship-to locations, but I think, Ron, if I remember correctly, we've actually seen pretty good traction out of that total effort, even though we may have had some small ship-tos. Those are not the ones that we're missing. We had, you know, with the, with the compression of our sales force that we did two years ago as we were getting set for the new sales force initiatives that we were putting in place and the technology tools, and the way that we're trying to drive productivity out of our teams. We, you know, we certainly saw with that some of our smaller core customers not get the level of service that we would expect. We had less salespeople, and as you might imagine, the salespeople that we had covered the bigger customers or the strategic accounts, the national accounts that we were trying to make sure we were doing a great job for across the country, first. So that caused a natural, you know, trend of losing some of our ship-to locations that just had less volume in them. And, you know, a real concern on our part at the leadership level on whether or not our salespeople were with that compression and then with the, you know, distraction of a lot more strategic and new national accounts, were spending as much time focused on the smaller street business that they used to, you know, make a lot of their money on. Ron and Mike DeCata started the national account or strategic account initiative about a decade ago, and it's grown to where it's as large as a part of our business as our street business is from zero. We're feeding our salespeople, you know, those national accounts. In some ways, that maybe was creating some behavioral challenges that we didn't appreciate until we got more insights out of the CRM. Now with, you know, kind of, the insights that better data analytics are allowing us to see and how we're keeping up with some of those smaller accounts. We went out in the market and did a bunch of feedback surveys that we needed to have at my level and our investment team level to be able to triangulate with our leadership team what we were hearing in the market from a lot of those smaller accounts. Now we've got a very proactive initiative around it, and we're seeing a re-lift back in those base accounts, at least the ship-to number. But it's been after several years of significant declines in locations. You know, you don't see it in the top line as much because you're picking up the strategic accounts and you're getting more volume through those bigger relationships. When you get down at the profitability level on a mix shift basis, especially if your cost to serve from a commission perspective or a cost for your salesperson is the same, you know, we get a more premium pricing out of the smaller accounts than what we do out of the bigger accounts, so that you're giving up some gross or some product margin, and then you're losing some flow-through contribution margin that if you just kind of held pat on that would have significantly changed the, you know, the total top-line revenue growth and the profitability of the business. All that was at the same time as we were investing significant amount of dollars into the company and into the sales force. You saw, you know, if you go back two years on Lawson, you know, you've seen, you know, we've got less revenue today on our MRO business than we had two years ago. We've got more today than we had last year. That, you know, most of that decrease really came out of those smaller accounts and the flow-through on that at the same time as you were investing in paying your sales force more, offering them more tools, and putting dollars back into it, caused a de-levering dynamic at the same time as we were making a deliberate investment. There was a swing in profitability there that we felt in the fourth quarter more acutely than we had in the prior fourth quarter. We knew what we were doing. We also knew that there was gonna be a J-curve as we were investing back in the sales force after that compression period of getting, you know, those sellers back out there into those territories that were either open or had been, you know, consolidated. Go ahead, Ron. You, you live this very much daily at Lawson. Yeah. Kevin, the only thing I would add to Bryan's comments, one is, you know, our strategic business, really sticky business. You know, we've got great customer relationships, you know, servicing, you know, multi-site locations. Drives, you know, really, solid, sticky gross margin dollars, back to us. We love that part of the business and, you know, continues to, we continue to expand it and continue to make, you know, make investments there to win new accounts as well. You know, relative to the core, the core local customers, if we do look at, you know, ship-to's over the last year or so, you know, they've really been, I would say, kind of flattish. Most of that decrease that we experienced within our core local customer counts, you know, took place, you know, prior to the beginning of 2025. Now it's about, as I mentioned, you know, they make, you know, they're about 45% of our total revenue. You know, to Bryan's point, it's putting, you know, some headwinds against the total sales growth that we see, and now it's a renewed focus on making sure that we can get, you know, that 45% of our revenue customer, base growing again. There's change in incentives and focus and even at the sales leadership meeting that I mentioned a couple of weeks ago, a lot of focus around where that business historically had been, where we sit today, and where we need to take it in the future with our sales leaders. I'd add I wanna add two things there because I think you asked the breadth and the complexity of the question you asked was great, but I wanna make sure I hit these other points. You asked about other support services or capabilities that we put in the field. We definitely have made a real investment. We're working on it in some key markets, but we're adding some service reps and some focused, you know, new account sellers, if you will, or re-engagement sellers. Not the field sales reps that we've got historically, but to support those field sales reps so that they have the time to get back in front of some of these customers that they've not spent as much time in front of by having these service reps support them on some of their higher volume relationships so that they aren't having to go by and see the account twice. If you think about the way that we often serve our, even our high volume customers, like those national accounts, you know, where they're going in and they're scanning the bins, they're putting in an order, and then they're coming back a couple of days later, and they're breaking open boxes, and they're reorganizing and reloading all those cabinets. That's that, you know, labor component that we sell as part of our value-added, our critical part of our value proposition to our customers, by having a service tech, you know, do a route and efficiently go by those customers and help take one of those stops out, then we're opening up the opportunity for those sales reps to spend more time back in the field, servicing those customers that maybe were either smaller on the street level or some of the national accounts that we're adding, that need, you know, kind of, early touch points high or, making sure that we're getting more wallet share out of them and getting them stood up on their initial, kind of, building out of their program. That's a real focus right now of the business. It's definitely been a cost center. I mean, we've layered that cost in, but it's something that we are seeing strong early indications that that's a model that we wanna continue to lean into to support our FSRs. It allows our FSRs, it allows them to make more money, because it gets their total, You know, total revenue that they can have flow through them up. We think it does a much better job of servicing the customer at a higher level. What our marketplace surveys have told us is that our customers felt like that too often our sales rep, if they were a smaller account, they just weren't getting the attention or they were being effectively fired by us, not by them. There's a, you know, it was a real message, it was consistent, that we heard, where they were asking for us to come back out and service them again and to give them that consistency of service that they wanted from us. That, you know, maybe over this transition period with our sales force, we haven't as consistently given to the smaller accounts. That's, you know, that's been a drag of several percentage points of growth a year the last several years at least, that we've been making up with our national sales efforts. Maybe two years ago, 2023 to 2024, it was a bigger drag 'cause we had that compression with our sales force, then we probably saw, you know, single-digit, mid-single digits, drag on our growth last year out of that, a little bit as well. Is that fair, Rob? You know the numbers. Maybe not quite that. Yeah. That and That and military. Yes. I ought to caveat that. The military was the other area that we saw a real shift in buying behavior that we're trying to work on re-engaging 'cause they have been historically a really good end market for us. We're still engaged with them, but their behavior shifted significantly in dollar spend over the last year and a half. Yeah. Sounds good. Well, thank you for all the color on that. Appreciate it. I just wanna lastly ask about the M&A pipeline, given your strong liquidity and the extension and expansion of your credit facility. Looks like you'd be set up to explore and maybe execute on some M&A opportunities. Yeah, we... Look, we highlighted that Sean joined us, you know, maybe 100 days ago or less. He's been a critical addition to our team. We spent, you know, the better part of the last year and a half, really evaluating our, you know, business development or M&A and corporate strategy part of our effort. Our, we had, you know, have a really strong team and colleague that used to work at Headwater that's been on the Gexpro Services side and then, you know, helping lead that effort the last several years. We brought in Sean to, you know, add some additional muscle memory to how to build out a team there. He's significantly increased the funnel. In just 100 days, he's gotten a lot of buy-in from the vertical leaders and from our team about where we wanna spend our time and effort. We had a few things last year that were high priorities for us that we had hoped to get done that didn't get done. I'd say that none of them are off the table, but they're, you know, but we just weren't able to get them over the goal line. They've been high priorities for some period of time. We have, you know, some things that we are focused on right now that are smaller tuck-in acquisitions that significantly bolster some areas of either strength or focus that we've got in a few of our vertical or a couple of our verticals. We would expect that there'll be some small tuck-in acquisitions that we'll be able to get over the goal line over the first half of this year. Okay. Sounds good. Those are important to driving accretive. The ones that I'm thinking of, there's three of them that, you know, that we have prioritized. All three of those would add significantly to the margin constructive of those three verticals. They're small. They're not. These are tuck-ins. Got it. Understood. Thanks again for all the insight. I'll turn it back over. Thank you for your time and your thoughtful questions. Thanks, Kevin. We have reached the end of the question and answer session, and I will now turn the call over to Bryan King for closing remarks. Appreciate everybody's engagement and your time this morning. We look forward to stronger quarters in the future and I appreciate everybody continuing to be supportive and engage with us. Have a great next several months. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Speaker 4: Greetings. Welcome to the Distribution Solutions Group Fourth Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Sandy Martin. You may begin. Greetings. greetings Welcome to the Distribution Solutions Group Fourth Quarter 2025 Earnings Conference Call. welcome to the distribution solutions group fourth quarter 2025 earnings conference call At this time, all participants are in a listen-only mode. at this time all participants are in a listen-only mode A question-and-answer session will follow the formal presentation. a question-and-answer session will follow the formal presentation If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. if anyone should require operator assistance during the conference please press star zero on your telephone keypad Please note this conference is being recorded. please note this conference is being recorded I will now turn the conference over to your host, Sandy Martin. i will now turn the conference over to your host sandy martin You may begin. you may begin

Speaker 6: Good morning, welcome to the Distribution Solutions Group's fourth quarter and full-year 2025 earnings call. Joining me on today's call are DSG's Chairman and Chief Executive Officer, Bryan King, and Executive Vice President and Chief Financial Officer, Ron Knutson. In conjunction with today's call, we have provided a financial results slide deck posted on the company's IR website at investor.distributionsolutionsgroup.com. Please note that statements on this call and in today's press release contain forward-looking statements concerning goals, beliefs, expectations, strategies, plans, future operating results and underlying assumptions subject to risk and uncertainties that could cause actual results to differ materially from those described. In addition, statements made during this call are based on the company's views as of today. Good morning, welcome to the Distribution Solutions Group's fourth quarter and full-year 2025 earnings call. good morning welcome to the distribution solutions group's fourth quarter and full-year 2025 earnings call Joining me on today's call are DSG's Chairman and Chief Executive Officer, Bryan King, and Executive Vice President and Chief Financial Officer, Ron Knutson. joining me on today's call are dsg's chairman and chief executive officer bryan king and executive vice president and chief financial officer ron knutson In conjunction with today's call, we have provided a financial results slide deck posted on the company's IR website at investor.distributionsolutionsgroup.com. in conjunction with today's call we have provided a financial results slide deck posted on the company's ir website at investor.distributionsolutionsgroup.com Please note that statements on this call and in today's press release contain forward-looking statements concerning goals, beliefs, expectations, strategies, plans, future operating results and underlying assumptions subject to risk and uncertainties that could cause actual results to differ materially from those described. please note that statements on this call and in today's press release contain forward-looking statements concerning goals beliefs expectations strategies plans future operating results and underlying assumptions subject to risk and uncertainties that could cause actual results to differ materially from those described In addition, statements made during this call are based on the company's views as of today. in addition statements made during this call are based on the company's views as of today The company anticipates that future developments may cause those views to change, and we may elect to update the forward-looking statements made today, but we disclaim any obligation to do so. Management will also refer to certain non-GAAP measures, and the reconciliation to the nearest GAAP measures are available at the end of our earnings release. The earnings release issued earlier today was posted on our investor relations website. A copy of the release has also been included in a current report on Form 8-K filed with the SEC. Lastly, this call is being webcast live on DSG's investor relations website, and a replay will be available through March 19th. I will now turn the call over to Bryan King. Bryan? The company anticipates that future developments may cause those views to change, and we may elect to update the forward-looking statements made today, but we disclaim any obligation to do so. the company anticipates that future developments may cause those views to change and we may elect to update the forward-looking statements made today but we disclaim any obligation to do so Management will also refer to certain non-GAAP measures, and the reconciliation to the nearest GAAP measures are available at the end of our earnings release. management will also refer to certain non-gaap measures and the reconciliation to the nearest gaap measures are available at the end of our earnings release The earnings release issued earlier today was posted on our investor relations website. the earnings release issued earlier today was posted on our investor relations website A copy of the release has also been included in a current report on Form 8-K filed with the SEC. a copy of the release has also been included in a current report on form 8-k filed with the sec Lastly, this call is being webcast live on DSG's investor relations website, and a replay will be available through March 19th. lastly this call is being webcast live on dsg's investor relations website and a replay will be available through march 19th I will now turn the call over to Bryan King. i will now turn the call over to bryan king Bryan? bryan

Speaker 1: Thanks, Sandy. Good morning, everyone, and thank you for joining us. As events unfold in the Middle East, we are actively assessing any potential implications for our business, our customers, and impact on the broader supply chain. Our thoughts and prayers are with the military personnel and civilians who are in harm's way and with their families. We will continue to monitor the potential implications for global markets and are committed to operating with resilience, discipline, and care during this period of elevated uncertainty. We are not where we wanna be at the end of the quarter, but our confidence and vision for the future remain strong. 2025 was a critical, internally focused reinvestment, retooling, and digesting year for DSG, as well as one where we managed through some dynamic pricing and supply chain and numerous one-time cost curveballs. Thanks, Sandy. thanks sandy Good morning, everyone, and thank you for joining us. good morning everyone and thank you for joining us As events unfold in the Middle East, we are actively assessing any potential implications for our business, our customers, and impact on the broader supply chain. as events unfold in the middle east we are actively assessing any potential implications for our business our customers and impact on the broader supply chain Our thoughts and prayers are with the military personnel and civilians who are in harm's way and with their families. our thoughts and prayers are with the military personnel and civilians who are in harm's way and with their families We will continue to monitor the potential implications for global markets and are committed to operating with resilience, discipline, and care during this period of elevated uncertainty. we will continue to monitor the potential implications for global markets and are committed to operating with resilience discipline and care during this period of elevated uncertainty We are not where we wanna be at the end of the quarter, but our confidence and vision for the future remain strong. 2025 was a critical, internally focused reinvestment, retooling, and digesting year for DSG, as well as one where we managed through some dynamic pricing and supply chain and numerous one-time cost curveballs. we are not where we wanna be at the end of the quarter but our confidence and vision for the future remain strong 2025 was a critical internally focused reinvestment retooling and digesting year for dsg as well as one where we managed through some dynamic pricing and supply chain and numerous one-time cost curveballs While it was at time a dizzyingly dynamic year through our daily North Star commitment to staying focused on investing in the business with a lens on long-term value creation, our urgency to offset shifting rules in the marketplace sharpened our focus on core fundamentals of building a better DSG. Enhanced focus on execution tools and talent on timely accountability across the organization and made us prioritize not delaying targeted significant investments in capabilities and talent to position the company for long-term success. As a result, we go into 2026 with an enhanced perspective on our competitive positioning and long-term levers to drive performance across our North American and global platforms. While it was at time a dizzyingly dynamic year through our daily North Star commitment to staying focused on investing in the business with a lens on long-term value creation, our urgency to offset shifting rules in the marketplace sharpened our focus on core fundamentals of building a better DSG. while it was at time a dizzyingly dynamic year through our daily north star commitment to staying focused on investing in the business with a lens on long-term value creation our urgency to offset shifting rules in the marketplace sharpened our focus on core fundamentals of building a better dsg Enhanced focus on execution tools and talent on timely accountability across the organization and made us prioritize not delaying targeted significant investments in capabilities and talent to position the company for long-term success. enhanced focus on execution tools and talent on timely accountability across the organization and made us prioritize not delaying targeted significant investments in capabilities and talent to position the company for long-term success As a result, we go into 2026 with an enhanced perspective on our competitive positioning and long-term levers to drive performance across our North American and global platforms. as a result we go into 2026 with an enhanced perspective on our competitive positioning and long-term levers to drive performance across our north american and global platforms As I reflected, we navigated challenging headwinds in 2025, including a government shutdown, shifting demand environment, and macroeconomic pressures and emotions, including those driven by fluid tariffs, where our diligent and largely effective efforts to recapture margin still left us short. Our financial results fell short of our expectations in the fourth quarter and for the year, and we own that. However, besides progress in our transformative investments, we enjoyed consistent operational affirmations in the marketplace around our value-added lines of business. Our teams delivered important new business and wallet share wins in each vertical, held on to business on the back of service and capabilities, and made meaningful progress in our customer-facing capabilities and partnerships in 2025. As I reflected, we navigated challenging headwinds in 2025, including a government shutdown, shifting demand environment, and macroeconomic pressures and emotions, including those driven by fluid tariffs, where our diligent and largely effective efforts to recapture margin still left us short. as i reflected we navigated challenging headwinds in 2025 including a government shutdown shifting demand environment and macroeconomic pressures and emotions including those driven by fluid tariffs where our diligent and largely effective efforts to recapture margin still left us short Our financial results fell short of our expectations in the fourth quarter and for the year, and we own that. our financial results fell short of our expectations in the fourth quarter and for the year and we own that However, besides progress in our transformative investments, we enjoyed consistent operational affirmations in the marketplace around our value-added lines of business. however besides progress in our transformative investments we enjoyed consistent operational affirmations in the marketplace around our value-added lines of business Our teams delivered important new business and wallet share wins in each vertical, held on to business on the back of service and capabilities, and made meaningful progress in our customer-facing capabilities and partnerships in 2025. our teams delivered important new business and wallet share wins in each vertical held on to business on the back of service and capabilities and made meaningful progress in our customer-facing capabilities and partnerships in 2025 We leaned in on improved discipline, heightened institutional adaptability, and enhanced DSG's more broadly presented and refined value-added solutions as confirmed by the marketplace, all of which add up to real 2025 successes and maturity of the business that will make us stronger in the longer term. Turning to slide four. For the full- year, we delivered total revenue growth of 9.8% on one less selling day, resulting in $1.98 billion in annual revenue. Organic average daily sales grew by 3.6%, reflecting solid underlying execution. Cash flows in 2025 were strong. We generated $84 million of cash from operations on top of $56 million in 2024. Adjusted EBITDA finished at $175 million, short of our expectations. These results demonstrate our continued focus on cash generation, working capital efficiency, and profitability. We leaned in on improved discipline, heightened institutional adaptability, and enhanced DSG's more broadly presented and refined value-added solutions as confirmed by the marketplace, all of which add up to real 2025 successes and maturity of the business that will make us stronger in the longer term. we leaned in on improved discipline heightened institutional adaptability and enhanced dsg's more broadly presented and refined value-added solutions as confirmed by the marketplace all of which add up to real 2025 successes and maturity of the business that will make us stronger in the longer term Turning to slide four. turning to slide four For the full- year, we delivered total revenue growth of 9.8% on one less selling day, resulting in $1.98 billion in annual revenue. for the full- year we delivered total revenue growth of 9.8% on one less selling day resulting in $1.98 billion in annual revenue Organic average daily sales grew by 3.6%, reflecting solid underlying execution. organic average daily sales grew by 3.6% reflecting solid underlying execution Cash flows in 2025 were strong. cash flows in 2025 were strong We generated $84 million of cash from operations on top of $56 million in 2024. we generated $84 million of cash from operations on top of $56 million in 2024 Adjusted EBITDA finished at $175 million, short of our expectations. adjusted ebitda finished at $175 million short of our expectations These results demonstrate our continued focus on cash generation, working capital efficiency, and profitability. these results demonstrate our continued focus on cash generation working capital efficiency and profitability Throughout the year, demand remained healthy across aerospace and defense, semiconductor-related technology, renewables, and as the year progressed, industrial power. During the fourth quarter, we began to see demand soften in renewables in North America, which we are actively managing by pivoting growth initiatives in that sector towards the strong renewables demand growth for DSG's improved presentation of capabilities in the global marketplace. Expanding our efforts on other end markets where we enjoy exceptional customer partnerships and strong secular and strengthening cyclical momentum, such as in industrial power, technology, and aerospace and defense. Our expanded platform capabilities and ability to support our historic customers and similarly discerning customers on a more global stage are supporting and expanding an accelerating set of dialogues. As we've discussed on previous calls, our financial results will not be linear. The fourth quarter is a good example of that. Throughout the year, demand remained healthy across aerospace and defense, semiconductor-related technology, renewables, and as the year progressed, industrial power. throughout the year demand remained healthy across aerospace and defense semiconductor-related technology renewables and as the year progressed industrial power During the fourth quarter, we began to see demand soften in renewables in North America, which we are actively managing by pivoting growth initiatives in that sector towards the strong renewables demand growth for DSG's improved presentation of capabilities in the global marketplace. during the fourth quarter we began to see demand soften in renewables in north america which we are actively managing by pivoting growth initiatives in that sector towards the strong renewables demand growth for dsg's improved presentation of capabilities in the global marketplace Expanding our efforts on other end markets where we enjoy exceptional customer partnerships and strong secular and strengthening cyclical momentum, such as in industrial power, technology, and aerospace and defense. expanding our efforts on other end markets where we enjoy exceptional customer partnerships and strong secular and strengthening cyclical momentum such as in industrial power technology and aerospace and defense Our expanded platform capabilities and ability to support our historic customers and similarly discerning customers on a more global stage are supporting and expanding an accelerating set of dialogues. our expanded platform capabilities and ability to support our historic customers and similarly discerning customers on a more global stage are supporting and expanding an accelerating set of dialogues As we've discussed on previous calls, our financial results will not be linear. as we've discussed on previous calls our financial results will not be linear The fourth quarter is a good example of that. the fourth quarter is a good example of that These results are certainly not indicative of our long-term plans or confidence in the future. While we anticipate some quarter-to-quarter challenges to balance earnings with our recent commitment to accelerate our talent recruitment, transitions, and accelerated investments, we are committed to making decisions that prioritize driving a stronger and more profitable DSG in the longer term for all of our committed stakeholders. Recognize, like in this quarter, that the timing of some of those decisions unintentionally lined up with some margin near-term pressure and taxed near-term earnings more than leadership expected. While we didn't want to delay investments and talent decisions to unnaturally smooth earnings at the expense of building a better company, our leadership team still expects much better profitability performance from our DSG platform of capabilities. Let's turn to slide five to discuss our business initiatives. These results are certainly not indicative of our long-term plans or confidence in the future. these results are certainly not indicative of our long-term plans or confidence in the future While we anticipate some quarter-to-quarter challenges to balance earnings with our recent commitment to accelerate our talent recruitment, transitions, and accelerated investments, we are committed to making decisions that prioritize driving a stronger and more profitable DSG in the longer term for all of our committed stakeholders. while we anticipate some quarter-to-quarter challenges to balance earnings with our recent commitment to accelerate our talent recruitment transitions and accelerated investments we are committed to making decisions that prioritize driving a stronger and more profitable dsg in the longer term for all of our committed stakeholders Recognize, like in this quarter, that the timing of some of those decisions unintentionally lined up with some margin near-term pressure and taxed near-term earnings more than leadership expected. recognize like in this quarter that the timing of some of those decisions unintentionally lined up with some margin near-term pressure and taxed near-term earnings more than leadership expected While we didn't want to delay investments and talent decisions to unnaturally smooth earnings at the expense of building a better company, our leadership team still expects much better profitability performance from our DSG platform of capabilities. while we didn't want to delay investments and talent decisions to unnaturally smooth earnings at the expense of building a better company our leadership team still expects much better profitability performance from our dsg platform of capabilities Let's turn to slide five to discuss our business initiatives. let's turn to slide five to discuss our business initiatives Gexpro Services delivered outstanding operating results in 2025, driven by the strength of the aerospace and defense, technology, and renewables end markets we serve. Despite some fourth quarter sales softness, full-year organic average daily sales increased 12.3%, with full-year ADS up 13%. We continue to invest in the technology and industrial power end markets, driven by expanding infrastructure needs and increasing AI-driven demand. Our order backlog and new business pipeline remains strong in both segments. While renewables slowed in North America in the second half of 2025, we shifted our investment focus towards global strategies with the encouragement of exceptional partners across technology, industrial power, aerospace and defense, and the power generation cycle. We are seeing a meaningful growth opportunity in India, while Southeast Asia is progressing more gradually due to the timing of customer qualifications. Gexpro Services delivered outstanding operating results in 2025, driven by the strength of the aerospace and defense, technology, and renewables end markets we serve. gexpro services delivered outstanding operating results in 2025 driven by the strength of the aerospace and defense technology and renewables end markets we serve Despite some fourth quarter sales softness, full-year organic average daily sales increased 12.3%, with full-year ADS up 13%. despite some fourth quarter sales softness full-year organic average daily sales increased 12.3% with full-year ads up 13% We continue to invest in the technology and industrial power end markets, driven by expanding infrastructure needs and increasing AI-driven demand. we continue to invest in the technology and industrial power end markets driven by expanding infrastructure needs and increasing ai-driven demand Our order backlog and new business pipeline remains strong in both segments. our order backlog and new business pipeline remains strong in both segments While renewables slowed in North America in the second half of 2025, we shifted our investment focus towards global strategies with the encouragement of exceptional partners across technology, industrial power, aerospace and defense, and the power generation cycle. while renewables slowed in north america in the second half of 2025 we shifted our investment focus towards global strategies with the encouragement of exceptional partners across technology industrial power aerospace and defense and the power generation cycle We are seeing a meaningful growth opportunity in India, while Southeast Asia is progressing more gradually due to the timing of customer qualifications. we are seeing a meaningful growth opportunity in india while southeast asia is progressing more gradually due to the timing of customer qualifications Both regions remain relatively small today, continue to show an excellent acceleration in prospective and current customer engagement across more of our proven value-added capabilities at DSG and Gexpro Services. Our European business remains strong, with increasing diversification across multiple verticals. Gexpro Services is also expanding its value-added service offerings using robotic automation and AI-enabled tools that enhance customer capabilities across VMI, kitting, manufacturing, and e-commerce solutions. Since bringing DSG together, Gexpro Services went from approximately $350 million in revenue to just under $500 million, mostly organically. Adjusted EBITDA has expanded from approximately $35 million to $64 million in 2025, with margins expanding nearly 300 basis points to 12.8%. This margin expansion reflects scale, broader geographic reach, enhanced value-added capabilities, and disciplined execution of operational efficiencies that leverage our cost structure. Both regions remain relatively small today, continue to show an excellent acceleration in prospective and current customer engagement across more of our proven value-added capabilities at DSG and Gexpro Services. both regions remain relatively small today continue to show an excellent acceleration in prospective and current customer engagement across more of our proven value-added capabilities at dsg and gexpro services Our European business remains strong, with increasing diversification across multiple verticals. our european business remains strong with increasing diversification across multiple verticals Gexpro Services is also expanding its value-added service offerings using robotic automation and AI-enabled tools that enhance customer capabilities across VMI, kitting, manufacturing, and e-commerce solutions. gexpro services is also expanding its value-added service offerings using robotic automation and ai-enabled tools that enhance customer capabilities across vmi kitting manufacturing and e-commerce solutions Since bringing DSG together, Gexpro Services went from approximately $350 million in revenue to just under $500 million, mostly organically. since bringing dsg together gexpro services went from approximately $350 million in revenue to just under $500 million mostly organically Adjusted EBITDA has expanded from approximately $35 million to $64 million in 2025, with margins expanding nearly 300 basis points to 12.8%. adjusted ebitda has expanded from approximately $35 million to $64 million in 2025 with margins expanding nearly 300 basis points to 12.8% This margin expansion reflects scale, broader geographic reach, enhanced value-added capabilities, and disciplined execution of operational efficiencies that leverage our cost structure. this margin expansion reflects scale broader geographic reach enhanced value-added capabilities and disciplined execution of operational efficiencies that leverage our cost structure As we confidently lean into further investment at Gexpro Services, we are balancing strong optimism around marketplace pull on us to support growth opportunities with an expectation to drive earnings growth while making the important long-term investments in capabilities, geographies, and talent to support performing for our customers at a level that adds to the reasons we are winning wallet share and new mandates. As a reminder, Gexpro Services launching new customer programs requires upfront investment of significant time and margin, but results in exceptionally sticky customer engagements where we are critical to our customers, and our commitment to doing our job for them thoughtfully and exceptionally reaffirms the partnership between us and our customers. As we confidently lean into further investment at Gexpro Services, we are balancing strong optimism around marketplace pull on us to support growth opportunities with an expectation to drive earnings growth while making the important long-term investments in capabilities, geographies, and talent to support performing for our customers at a level that adds to the reasons we are winning wallet share and new mandates. as we confidently lean into further investment at gexpro services we are balancing strong optimism around marketplace pull on us to support growth opportunities with an expectation to drive earnings growth while making the important long-term investments in capabilities geographies and talent to support performing for our customers at a level that adds to the reasons we are winning wallet share and new mandates As a reminder, Gexpro Services launching new customer programs requires upfront investment of significant time and margin, but results in exceptionally sticky customer engagements where we are critical to our customers, and our commitment to doing our job for them thoughtfully and exceptionally reaffirms the partnership between us and our customers. as a reminder gexpro services launching new customer programs requires upfront investment of significant time and margin but results in exceptionally sticky customer engagements where we are critical to our customers and our commitment to doing our job for them thoughtfully and exceptionally reaffirms the partnership between us and our customers The upfront effort and investment can cause a bit of deleveraging of profits in any given quarter as programs ramp up or mature programs slow, like the shift we felt on the margin in the fourth quarter as new programs in global renewables come on but domestic programs slow, or as we felt a year or so ago in technology. The great news is that the new business pipeline continues to expand even as mature programs may fluctuate based on each customer's program momentum. We also continue to win significant wallet share. We rarely lose programs, and expanding what Gexpro Services does as a part of DSG allows us to expand our engagement with our customers. Gexpro Services continues to be one of the most exciting growth levers for DSG. The upfront effort and investment can cause a bit of deleveraging of profits in any given quarter as programs ramp up or mature programs slow, like the shift we felt on the margin in the fourth quarter as new programs in global renewables come on but domestic programs slow, or as we felt a year or so ago in technology. the upfront effort and investment can cause a bit of deleveraging of profits in any given quarter as programs ramp up or mature programs slow like the shift we felt on the margin in the fourth quarter as new programs in global renewables come on but domestic programs slow or as we felt a year or so ago in technology The great news is that the new business pipeline continues to expand even as mature programs may fluctuate based on each customer's program momentum. the great news is that the new business pipeline continues to expand even as mature programs may fluctuate based on each customer's program momentum We also continue to win significant wallet share. we also continue to win significant wallet share We rarely lose programs, and expanding what Gexpro Services does as a part of DSG allows us to expand our engagement with our customers. we rarely lose programs and expanding what gexpro services does as a part of dsg allows us to expand our engagement with our customers Gexpro Services continues to be one of the most exciting growth levers for DSG. gexpro services continues to be one of the most exciting growth levers for dsg Looking ahead, we are excited and focused on investing even more deliberately in additional organic and inorganic initiatives to sustain and extend the strong long-term momentum we see at Gexpro Services. Next, Lawson Products. Average daily sales increased 2.7% in the fourth quarter, continuing the momentum from the third quarter, when average daily sales grew by 3%. Although new VMI installations and wallet share expansions led to organic sales growth throughout the second half of 2025, Lawson's smaller account local revenue continued to be challenged in the fourth quarter as some of the sales force and selling tools transformation over the last couple of years have distracted our resources from doing the exceptional job our customers champion from our unique service model and that we expect. Looking ahead, we are excited and focused on investing even more deliberately in additional organic and inorganic initiatives to sustain and extend the strong long-term momentum we see at Gexpro Services. looking ahead we are excited and focused on investing even more deliberately in additional organic and inorganic initiatives to sustain and extend the strong long-term momentum we see at gexpro services Next, Lawson Products. next lawson products Average daily sales increased 2.7% in the fourth quarter, continuing the momentum from the third quarter, when average daily sales grew by 3%. average daily sales increased 2.7% in the fourth quarter continuing the momentum from the third quarter when average daily sales grew by 3% Although new VMI installations and wallet share expansions led to organic sales growth throughout the second half of 2025, Lawson's smaller account local revenue continued to be challenged in the fourth quarter as some of the sales force and selling tools transformation over the last couple of years have distracted our resources from doing the exceptional job our customers champion from our unique service model and that we expect. although new vmi installations and wallet share expansions led to organic sales growth throughout the second half of 2025 lawson's smaller account local revenue continued to be challenged in the fourth quarter as some of the sales force and selling tools transformation over the last couple of years have distracted our resources from doing the exceptional job our customers champion from our unique service model and that we expect Lots of focus and tools, teamed with additional investment in talent and process improvements, are focused on getting this right for our customers, sales team, and for DSG. EBITDA margins were negatively impacted by a slight customer mix shift, deliberate strategic investments, and an unexpectedly elevated healthcare benefit cost in the quarter and for the full-year, which Ron will discuss in more detail in a moment. Recently, Lawson has made strategic investments in two leadership roles to strengthen the team through more capabilities and accountability. We brought on Jim Slomka as Chief Revenue Officer and Hillary Bryant as Chief People Officer. Lots of focus and tools, teamed with additional investment in talent and process improvements, are focused on getting this right for our customers, sales team, and for DSG. lots of focus and tools teamed with additional investment in talent and process improvements are focused on getting this right for our customers sales team and for dsg EBITDA margins were negatively impacted by a slight customer mix shift, deliberate strategic investments, and an unexpectedly elevated healthcare benefit cost in the quarter and for the full-year, which Ron will discuss in more detail in a moment. Recently, Lawson has made strategic investments in two leadership roles to strengthen the team through more capabilities and accountability. ebitda margins were negatively impacted by a slight customer mix shift deliberate strategic investments and an unexpectedly elevated healthcare benefit cost in the quarter and for the full-year which ron will discuss in more detail in a moment. recently lawson has made strategic investments in two leadership roles to strengthen the team through more capabilities and accountability We brought on Jim Slomka as Chief Revenue Officer and Hillary Bryant as Chief People Officer. we brought on jim slomka as chief revenue officer and hillary bryant as chief people officer Jim joined Lawson Products in January 2026 and brings a proven track record of commercial transformation, having led sales and operations for a $1.8 billion omnichannel enterprise, overseeing more than 2,000 sales professionals, delivering a six-year sales CAGR of 8% and expanding gross margins by 300 basis points. He brings strong discipline around accountability, urgency, process, and commitments to a team-focused enthusiasm for excellence and winning, all consistent with being a former West Point athlete and officer. We are thrilled to welcome Jim to Lawson Products and DSG and are confident on the immediate impact he will have on the organization. Hillary brings deep global HR leadership experience, most recently managing a worldwide HR organization for a $1.4 billion industrial technologies company with approximately 4,000 employees. Jim joined Lawson Products in January 2026 and brings a proven track record of commercial transformation, having led sales and operations for a $1.8 billion omnichannel enterprise, overseeing more than 2,000 sales professionals, delivering a six-year sales CAGR of 8% and expanding gross margins by 300 basis points. jim joined lawson products in january 2026 and brings a proven track record of commercial transformation having led sales and operations for a $1.8 billion omnichannel enterprise overseeing more than 2,000 sales professionals delivering a six-year sales cagr of 8% and expanding gross margins by 300 basis points He brings strong discipline around accountability, urgency, process, and commitments to a team-focused enthusiasm for excellence and winning, all consistent with being a former West Point athlete and officer. he brings strong discipline around accountability urgency process and commitments to a team-focused enthusiasm for excellence and winning all consistent with being a former west point athlete and officer We are thrilled to welcome Jim to Lawson Products and DSG and are confident on the immediate impact he will have on the organization. we are thrilled to welcome jim to lawson products and dsg and are confident on the immediate impact he will have on the organization Hillary brings deep global HR leadership experience, most recently managing a worldwide HR organization for a $1.4 billion industrial technologies company with approximately 4,000 employees. hillary brings deep global hr leadership experience most recently managing a worldwide hr organization for a $1.4 billion industrial technologies company with approximately 4,000 employees She offers a great complement to Jim, bringing a renewed discipline and energy to employee engagement and corporate culture while elevating a clear cadence around growth-focused expectation, urgency, and rewards. These important investments, alongside others that have also been recruited over the last years, put in place critical pieces to now have a stronger ensemble of experienced, been-there-done-that leadership and collectively add meaningfully to our sales and operating foundation as we pursue improved growth and execution in 2026. Turning to our 2026 growth priorities. We are focused on continuing to capture market share and expanding wallet share for our national accounts, including Lawson, Kent, and Government, while reestablishing our commitment to offering the highest level of consistent service out of our sales force for our customers. She offers a great complement to Jim, bringing a renewed discipline and energy to employee engagement and corporate culture while elevating a clear cadence around growth-focused expectation, urgency, and rewards. she offers a great complement to jim bringing a renewed discipline and energy to employee engagement and corporate culture while elevating a clear cadence around growth-focused expectation urgency and rewards These important investments, alongside others that have also been recruited over the last years, put in place critical pieces to now have a stronger ensemble of experienced, been-there-done-that leadership and collectively add meaningfully to our sales and operating foundation as we pursue improved growth and execution in 2026. these important investments alongside others that have also been recruited over the last years put in place critical pieces to now have a stronger ensemble of experienced been-there-done-that leadership and collectively add meaningfully to our sales and operating foundation as we pursue improved growth and execution in 2026 Turning to our 2026 growth priorities. turning to our 2026 growth priorities We are focused on continuing to capture market share and expanding wallet share for our national accounts, including Lawson, Kent, and Government, while reestablishing our commitment to offering the highest level of consistent service out of our sales force for our customers. we are focused on continuing to capture market share and expanding wallet share for our national accounts including lawson kent and government while reestablishing our commitment to offering the highest level of consistent service out of our sales force for our customers With that, a return to growth out of our smaller local accounts driven by their efforts and the investment we have made in them. A key leading indicator of our growth is in new VMI installations, or internally what we refer to as ship-to locations, which we are currently ramping up after a challenging couple of years as we've been working through our sales force transformation. We continue to leverage technology to increase sales effectiveness and are improving the rigor and consistency of sales rep activity supported by our CRM tool, enhanced training commitment for new FSRs, and a real focus on our DSMs consistent cadence with our established FSRs around driving growth and consistency in the customer experience. With that, a return to growth out of our smaller local accounts driven by their efforts and the investment we have made in them. with that a return to growth out of our smaller local accounts driven by their efforts and the investment we have made in them A key leading indicator of our growth is in new VMI installations, or internally what we refer to as ship-to locations, which we are currently ramping up after a challenging couple of years as we've been working through our sales force transformation. a key leading indicator of our growth is in new vmi installations or internally what we refer to as ship-to locations which we are currently ramping up after a challenging couple of years as we've been working through our sales force transformation We continue to leverage technology to increase sales effectiveness and are improving the rigor and consistency of sales rep activity supported by our CRM tool, enhanced training commitment for new FSRs, and a real focus on our DSMs consistent cadence with our established FSRs around driving growth and consistency in the customer experience. we continue to leverage technology to increase sales effectiveness and are improving the rigor and consistency of sales rep activity supported by our crm tool enhanced training commitment for new fsrs and a real focus on our dsms consistent cadence with our established fsrs around driving growth and consistency in the customer experience We are also in the early stages of rolling out across our field customer-facing team, a route optimization tool that we have been developing that will give them back expensive and frustrating transit time and more of an opportunity to serve and grow our customers. Although a smaller piece of our business, our e-commerce channel continues to deliver double-digit growth, and we are encouraged that more than 30% of customers purchasing through the site are new to Lawson. As we move forward, we remain focused on commercial excellence, the customer experience, and technology to accelerate growth and continuously improve how we serve our customers while also providing flexibility to our customers. Additionally, we are working more closely with our vendor partners to deliver solutions to our customers and to support our commercial team. We are also in the early stages of rolling out across our field customer-facing team, a route optimization tool that we have been developing that will give them back expensive and frustrating transit time and more of an opportunity to serve and grow our customers. we are also in the early stages of rolling out across our field customer-facing team a route optimization tool that we have been developing that will give them back expensive and frustrating transit time and more of an opportunity to serve and grow our customers Although a smaller piece of our business, our e-commerce channel continues to deliver double-digit growth, and we are encouraged that more than 30% of customers purchasing through the site are new to Lawson. although a smaller piece of our business our e-commerce channel continues to deliver double-digit growth and we are encouraged that more than 30% of customers purchasing through the site are new to lawson As we move forward, we remain focused on commercial excellence, the customer experience, and technology to accelerate growth and continuously improve how we serve our customers while also providing flexibility to our customers. as we move forward we remain focused on commercial excellence the customer experience and technology to accelerate growth and continuously improve how we serve our customers while also providing flexibility to our customers Additionally, we are working more closely with our vendor partners to deliver solutions to our customers and to support our commercial team. additionally we are working more closely with our vendor partners to deliver solutions to our customers and to support our commercial team At our recent sales leadership meeting in February, approximately 50 vendors presented their products and services to our sales team. We are working with a number of those channel partners to improve our product costs as we have in turn invested to support them and our customers with our significant recent investments in our selling and servicing capabilities. We expect some nice progress this year out of our sourcing partnerships. Moving on to the Canadian branch division. The team made solid operational and synergy progress in the 4th quarter and across the full-year, despite macroeconomic headwinds and tariff-related uncertainty that pressured industrial end markets, especially in Canada, throughout 2025. As expected, 4th quarter revenue declined sequentially due to typical holiday season softness and weather, leading to operational deleverage. In 2025, we completed four facility consolidations, with the final consolidation expected by the end of the 1st quarter. At our recent sales leadership meeting in February, approximately 50 vendors presented their products and services to our sales team. at our recent sales leadership meeting in february approximately 50 vendors presented their products and services to our sales team We are working with a number of those channel partners to improve our product costs as we have in turn invested to support them and our customers with our significant recent investments in our selling and servicing capabilities. we are working with a number of those channel partners to improve our product costs as we have in turn invested to support them and our customers with our significant recent investments in our selling and servicing capabilities We expect some nice progress this year out of our sourcing partnerships. we expect some nice progress this year out of our sourcing partnerships Moving on to the Canadian branch division. moving on to the canadian branch division The team made solid operational and synergy progress in the 4th quarter and across the full-year, despite macroeconomic headwinds and tariff-related uncertainty that pressured industrial end markets, especially in Canada, throughout 2025. the team made solid operational and synergy progress in the 4th quarter and across the full-year despite macroeconomic headwinds and tariff-related uncertainty that pressured industrial end markets especially in canada throughout 2025 As expected, 4th quarter revenue declined sequentially due to typical holiday season softness and weather, leading to operational deleverage. as expected 4th quarter revenue declined sequentially due to typical holiday season softness and weather leading to operational deleverage In 2025, we completed four facility consolidations, with the final consolidation expected by the end of the 1st quarter. in 2025 we completed four facility consolidations with the final consolidation expected by the end of the 1st quarter As we discussed last quarter, because Source Atlantic's purchase price was largely tied to tangible assets, our first full-year of transformation has meaningfully de-risked this investment for us, and we continue to believe this was a strong strategic acquisition to grow and scale our Canadian operations. Although the revenue headwind out of the gate has us a full-year behind our ambitious profitability objectives our DSG team embraced when we acquired Source Atlantic in late 2024. More recently, the recruited Canadian leadership team reaffirmed that underwriting. While there is still significant profitability tuning work ahead, we are encouraged by our framework in expanding profitability, insights, and discipline that we are building, the team we put in place, and the path and significant progress they are demonstrating to us in the marketplace as the first year of ownership is now closed. As we discussed last quarter, because Source Atlantic's purchase price was largely tied to tangible assets, our first full-year of transformation has meaningfully de-risked this investment for us, and we continue to believe this was a strong strategic acquisition to grow and scale our Canadian operations. as we discussed last quarter because source atlantic's purchase price was largely tied to tangible assets our first full-year of transformation has meaningfully de-risked this investment for us and we continue to believe this was a strong strategic acquisition to grow and scale our canadian operations Although the revenue headwind out of the gate has us a full-year behind our ambitious profitability objectives our DSG team embraced when we acquired Source Atlantic in late 2024. although the revenue headwind out of the gate has us a full-year behind our ambitious profitability objectives our dsg team embraced when we acquired source atlantic in late 2024 More recently, the recruited Canadian leadership team reaffirmed that underwriting. more recently the recruited canadian leadership team reaffirmed that underwriting While there is still significant profitability tuning work ahead, we are encouraged by our framework in expanding profitability, insights, and discipline that we are building, the team we put in place, and the path and significant progress they are demonstrating to us in the marketplace as the first year of ownership is now closed. while there is still significant profitability tuning work ahead we are encouraged by our framework in expanding profitability insights and discipline that we are building the team we put in place and the path and significant progress they are demonstrating to us in the marketplace as the first year of ownership is now closed At the TestEquity Group, we are investing at a renewed feverish pace in the long-term platform we can better see now in this vertical. A massive investment in additional leadership capabilities and tools were made in the business, especially during the last part of 2025. A shift was made concurrent with these investments around dialing up a more intense focus and intentional allocation of resources towards driving a structurally higher margin shift discipline out of a daily cadence around the vertical's growth priorities. Each team member owns specific accountability on discrete levers to impact that outcome. When we committed to these investments, we fully expected a J-curve recovery, with near-term transitions impacting performance, followed by improved revenue growth and profitability as our strategic initiatives take hold. At the TestEquity Group, we are investing at a renewed feverish pace in the long-term platform we can better see now in this vertical. at the testequity group we are investing at a renewed feverish pace in the long-term platform we can better see now in this vertical A massive investment in additional leadership capabilities and tools were made in the business, especially during the last part of 2025. a massive investment in additional leadership capabilities and tools were made in the business especially during the last part of 2025 A shift was made concurrent with these investments around dialing up a more intense focus and intentional allocation of resources towards driving a structurally higher margin shift discipline out of a daily cadence around the vertical's growth priorities. a shift was made concurrent with these investments around dialing up a more intense focus and intentional allocation of resources towards driving a structurally higher margin shift discipline out of a daily cadence around the vertical's growth priorities Each team member owns specific accountability on discrete levers to impact that outcome. each team member owns specific accountability on discrete levers to impact that outcome When we committed to these investments, we fully expected a J-curve recovery, with near-term transitions impacting performance, followed by improved revenue growth and profitability as our strategic initiatives take hold. when we committed to these investments we fully expected a j-curve recovery with near-term transitions impacting performance followed by improved revenue growth and profitability as our strategic initiatives take hold For the full-year, average daily sales increased 2%, organic daily sales grew 1%, driven primarily by test and measurement, rentals, and chambers. In the fourth quarter, revenue grew 0.9% on one additional selling day, supported by continued momentum in rental and refurb chambers and TestEquity. While test and measurement end markets were under pressure in the fourth quarter, we remain focused on disciplined execution of our growth and profitability prioritization initiatives and are beginning to see the tighter strategic lens and accelerated pacing around cadence and accountability at work. For the full-year, average daily sales increased 2%, organic daily sales grew 1%, driven primarily by test and measurement, rentals, and chambers. In the fourth quarter, revenue grew 0.9% on one additional selling day, supported by continued momentum in rental and refurb chambers and TestEquity. for the full-year average daily sales increased 2% organic daily sales grew 1% driven primarily by test and measurement rentals and chambers. in the fourth quarter revenue grew 0.9% on one additional selling day supported by continued momentum in rental and refurb chambers and testequity While test and measurement end markets were under pressure in the fourth quarter, we remain focused on disciplined execution of our growth and profitability prioritization initiatives and are beginning to see the tighter strategic lens and accelerated pacing around cadence and accountability at work. while test and measurement end markets were under pressure in the fourth quarter we remain focused on disciplined execution of our growth and profitability prioritization initiatives and are beginning to see the tighter strategic lens and accelerated pacing around cadence and accountability at work The result is we are seeing engagement deep into the organization take place, and the affirming pipeline activity evolving towards our areas of most differentiated capabilities, teamed with our higher margins and return on capital opportunities, including value-added solutions used in rental, Test and Measurement solutions, chambers, and accelerating the growth and mix around our most value-added elements of our electronic production supply offering to strengthen our margins and earnings. We are currently seeing some accelerating customer engagement building around our core Test and Measurement expertise, where we have reinforced with a renewed and discrete effort around rededicating resources focused on T&M customer solutions, selling, improve our competitive moat at a time when we believe the marketplace has passed the trough and we are seeing acceleration. We also have major initiatives underway to simplify and unify the digital ecosystem. The result is we are seeing engagement deep into the organization take place, and the affirming pipeline activity evolving towards our areas of most differentiated capabilities, teamed with our higher margins and return on capital opportunities, including value-added solutions used in rental, Test and Measurement solutions, chambers, and accelerating the growth and mix around our most value-added elements of our electronic production supply offering to strengthen our margins and earnings. the result is we are seeing engagement deep into the organization take place and the affirming pipeline activity evolving towards our areas of most differentiated capabilities teamed with our higher margins and return on capital opportunities including value-added solutions used in rental test and measurement solutions chambers and accelerating the growth and mix around our most value-added elements of our electronic production supply offering to strengthen our margins and earnings We are currently seeing some accelerating customer engagement building around our core Test and Measurement expertise, where we have reinforced with a renewed and discrete effort around rededicating resources focused on T&M customer solutions, selling, improve our competitive moat at a time when we believe the marketplace has passed the trough and we are seeing acceleration. we are currently seeing some accelerating customer engagement building around our core test and measurement expertise where we have reinforced with a renewed and discrete effort around rededicating resources focused on t&m customer solutions selling improve our competitive moat at a time when we believe the marketplace has passed the trough and we are seeing acceleration We also have major initiatives underway to simplify and unify the digital ecosystem. we also have major initiatives underway to simplify and unify the digital ecosystem Enhancing the customer experience through ERP consolidation, customer service, and e-commerce platform integration is foundational to our strategy, and we are actively leveraging AI applications to accelerate execution. At the same time, we are strengthening performance management, incentives, and accountability as we establish new key leadership roles. We're excited about the progress Barry is making to drive a much more disciplined approach to the portfolio of value-added capabilities and products offered across the TestEquity Group vertical. For the employees, we appreciate their support of his accelerated operational pace and accountability, including the shifting of time and resources towards more differentiated growth areas to drive his objectives around mix shift rather than only adding incremental costs in elevated areas of focus. Enhancing the customer experience through ERP consolidation, customer service, and e-commerce platform integration is foundational to our strategy, and we are actively leveraging AI applications to accelerate execution. enhancing the customer experience through erp consolidation customer service and e-commerce platform integration is foundational to our strategy and we are actively leveraging ai applications to accelerate execution At the same time, we are strengthening performance management, incentives, and accountability as we establish new key leadership roles. at the same time we are strengthening performance management incentives and accountability as we establish new key leadership roles We're excited about the progress Barry is making to drive a much more disciplined approach to the portfolio of value-added capabilities and products offered across the TestEquity Group vertical. we're excited about the progress barry is making to drive a much more disciplined approach to the portfolio of value-added capabilities and products offered across the testequity group vertical For the employees, we appreciate their support of his accelerated operational pace and accountability, including the shifting of time and resources towards more differentiated growth areas to drive his objectives around mix shift rather than only adding incremental costs in elevated areas of focus. for the employees we appreciate their support of his accelerated operational pace and accountability including the shifting of time and resources towards more differentiated growth areas to drive his objectives around mix shift rather than only adding incremental costs in elevated areas of focus Looking ahead, we are actively increasing our account base and deepening penetration among our existing customers while using new product introductions and private label offerings to expand customer choice and enhance margins. Encouragingly, a growing backlog in January and February of 2026 signals momentum to come in 2026. We recognize that the full impact of these initiatives typically takes several quarters, but we are confident they will result in a structurally stronger, more competitive, materially higher margin TestEquity business over time. With that, I'll turn it over to Ron for details on our fourth quarter and full-year financials. Ron? Looking ahead, we are actively increasing our account base and deepening penetration among our existing customers while using new product introductions and private label offerings to expand customer choice and enhance margins. looking ahead we are actively increasing our account base and deepening penetration among our existing customers while using new product introductions and private label offerings to expand customer choice and enhance margins Encouragingly, a growing backlog in January and February of 2026 signals momentum to come in 2026. encouragingly a growing backlog in january and february of 2026 signals momentum to come in 2026 We recognize that the full impact of these initiatives typically takes several quarters, but we are confident they will result in a structurally stronger, more competitive, materially higher margin TestEquity business over time. we recognize that the full impact of these initiatives typically takes several quarters but we are confident they will result in a structurally stronger more competitive materially higher margin testequity business over time With that, I'll turn it over to Ron for details on our fourth quarter and full-year financials. with that i'll turn it over to ron for details on our fourth quarter and full-year financials Ron? ron

Speaker 5: Thank you, Bryan, and good morning, everyone. Turning to slide six and starting with our full-year results for 2025. As Bryan mentioned, consolidated revenues for the year were $1.98 billion, up 9.8% compared to 2024. Incremental revenue from our 2024 acquisitions was $121.5 million, and our organic average daily sales growth for the fiscal year was up 3.6% over 2024. For the year, Adjusted EBITDA was $175.2 million or 8.9% of sales, and GAAP net income per diluted share was $0.18 for the year versus a GAAP net loss per diluted share of $0.16 a year ago. Non-GAAP adjusted EPS was $1.24 for the year compared to $1.44 per share a year ago. Thank you, Bryan, and good morning, everyone. thank you bryan and good morning everyone Turning to slide six and starting with our full-year results for 2025. turning to slide six and starting with our full-year results for 2025 As Bryan mentioned, consolidated revenues for the year were $1.98 billion, up 9.8% compared to 2024. as bryan mentioned consolidated revenues for the year were $1.98 billion up 9.8% compared to 2024 Incremental revenue from our 2024 acquisitions was $121.5 million, and our organic average daily sales growth for the fiscal year was up 3.6% over 2024. incremental revenue from our 2024 acquisitions was $121.5 million and our organic average daily sales growth for the fiscal year was up 3.6% over 2024 For the year, Adjusted EBITDA was $175.2 million or 8.9% of sales, and GAAP net income per diluted share was $0.18 for the year versus a GAAP net loss per diluted share of $0.16 a year ago. for the year adjusted ebitda was $175.2 million or 8.9% of sales and gaap net income per diluted share was $0.18 for the year versus a gaap net loss per diluted share of $0.16 a year ago Non-GAAP adjusted EPS was $1.24 for the year compared to $1.44 per share a year ago. non-gaap adjusted eps was $1.24 for the year compared to $1.44 per share a year ago full-year margins in 2025 were 80 basis points lower than in 2024, primarily due to sales mix shifts, employee-related costs, and other investments. Fourth quarter revenues were $482 million, up 0.2% versus a year ago, which translated into flat organic sales compared to the fourth quarter of 2024. For the quarter, we generated Adjusted EBITDA of $35.4 million or 7.4% of sales. Each of our businesses experienced lower year-over-year EBITDA margins, primarily due to sales mix shifts, some incremental bad debt expense, and higher health employee-related costs, namely healthcare benefits. Cash flow from operations was strong, with $16.9 million for the quarter and $84 million for the full-year on top of strong results in 2024. full-year margins in 2025 were 80 basis points lower than in 2024, primarily due to sales mix shifts, employee-related costs, and other investments. full-year margins in 2025 were 80 basis points lower than in 2024 primarily due to sales mix shifts employee-related costs and other investments Fourth quarter revenues were $482 million, up 0.2% versus a year ago, which translated into flat organic sales compared to the fourth quarter of 2024. fourth quarter revenues were $482 million up 0.2% versus a year ago which translated into flat organic sales compared to the fourth quarter of 2024 For the quarter, we generated Adjusted EBITDA of $35.4 million or 7.4% of sales. for the quarter we generated adjusted ebitda of $35.4 million or 7.4% of sales Each of our businesses experienced lower year-over-year EBITDA margins, primarily due to sales mix shifts, some incremental bad debt expense, and higher health employee-related costs, namely healthcare benefits. each of our businesses experienced lower year-over-year ebitda margins primarily due to sales mix shifts some incremental bad debt expense and higher health employee-related costs namely healthcare benefits Cash flow from operations was strong, with $16.9 million for the quarter and $84 million for the full-year on top of strong results in 2024. cash flow from operations was strong with $16.9 million for the quarter and $84 million for the full-year on top of strong results in 2024 Before I move on to the individual verticals, I wanted to comment briefly on the DSG consolidated margin for the full-year and for the quarter. For the full-year, Adjusted EBITDA was 8.9% compared to 9.7% for the full-year 2024. I would break the 80 bips compression into two buckets. The first is primarily longer-term people investments of approximately 20 bips. The remaining 70 bips was driven by timing items and non-recurring items such as healthcare costs, specific customer bad debt reserves, and some lower margin to win specific customers. From a timing perspective, many of these items hit in the fourth quarter, resulting in a larger impact on our fourth quarter margins of 7.4%. Longer-term people investments impacted the quarter by approximately 25 bips. Before I move on to the individual verticals, I wanted to comment briefly on the DSG consolidated margin for the full-year and for the quarter. before i move on to the individual verticals i wanted to comment briefly on the dsg consolidated margin for the full-year and for the quarter For the full-year, Adjusted EBITDA was 8.9% compared to 9.7% for the full-year 2024. for the full-year adjusted ebitda was 8.9% compared to 9.7% for the full-year 2024 I would break the 80 bips compression into two buckets. i would break the 80 bips compression into two buckets The first is primarily longer-term people investments of approximately 20 bips. the first is primarily longer-term people investments of approximately 20 bips The remaining 70 bips was driven by timing items and non-recurring items such as healthcare costs, specific customer bad debt reserves, and some lower margin to win specific customers. the remaining 70 bips was driven by timing items and non-recurring items such as healthcare costs specific customer bad debt reserves and some lower margin to win specific customers From a timing perspective, many of these items hit in the fourth quarter, resulting in a larger impact on our fourth quarter margins of 7.4%. from a timing perspective many of these items hit in the fourth quarter resulting in a larger impact on our fourth quarter margins of 7.4% Longer-term people investments impacted the quarter by approximately 25 bips. longer-term people investments impacted the quarter by approximately 25 bips Other items impacting the quarter that we would classify as timing or non-recurring include healthcare, approximately 40 bips, customer specific bad debt, approximately 20 bips. Recruiting and leadership startup approximately 25 bps, mix shifts within Gexpro Services approximately 25 bps, and timing benefits realized in the fourth quarter of 2024, which was about 40 bps. Moving on to slide seven and starting with Lawson. With Lawson, full-year revenue increased $12 million, average daily sales grew by 2.6%, and organic average daily sales declined by 1.2%, primarily due to lower military customer sales. Adjusted EBITDA for the year was $51.6 million or 10.7% of revenues for the full-year. For the quarter, Lawson's average daily sales were up 2.7% and its Adjusted EBITDA was $7.7 million or 6.7% of sales. Other items impacting the quarter that we would classify as timing or non-recurring include healthcare, approximately 40 bips, customer specific bad debt, approximately 20 bips. Recruiting and leadership startup approximately 25 bps, mix shifts within Gexpro Services approximately 25 bps, and timing benefits realized in the fourth quarter of 2024, which was about 40 bps. other items impacting the quarter that we would classify as timing or non-recurring include healthcare approximately 40 bips customer specific bad debt approximately 20 bips. recruiting and leadership startup approximately 25 bps mix shifts within gexpro services approximately 25 bps and timing benefits realized in the fourth quarter of 2024 which was about 40 bps Moving on to slide seven and starting with Lawson. moving on to slide seven and starting with lawson With Lawson, full-year revenue increased $12 million, average daily sales grew by 2.6%, and organic average daily sales declined by 1.2%, primarily due to lower military customer sales. with lawson full-year revenue increased $12 million average daily sales grew by 2.6% and organic average daily sales declined by 1.2% primarily due to lower military customer sales Adjusted EBITDA for the year was $51.6 million or 10.7% of revenues for the full-year. adjusted ebitda for the year was $51.6 million or 10.7% of revenues for the full-year For the quarter, Lawson's average daily sales were up 2.7% and its Adjusted EBITDA was $7.7 million or 6.7% of sales. for the quarter lawson's average daily sales were up 2.7% and its adjusted ebitda was $7.7 million or 6.7% of sales In the Lawson-based business, the margin compression from the prior year was primarily due to sales mix of about 60 bps, higher health employee-related benefit costs of approximately 100 bps, and employee costs and timing of incentive accruals of approximately 110 bps. As Bryan mentioned, Lawson's most significant sales initiatives focus on new VMI installations and increased share of wallet, which are leading indicators of revenue growth. We are continuing to accelerate the adoption of our CRM platform to improve sales rep productivity, grow the core business, and are currently in the early stages of route optimization planning. We are also expanding our e-commerce platform. This is a cost-effective way to do business, and 1/3 of our customers on the site are new. Although sales are still small on e-commerce, we experienced about an 18% revenue growth in the fourth quarter. In the Lawson-based business, the margin compression from the prior year was primarily due to sales mix of about 60 bps, higher health employee-related benefit costs of approximately 100 bps, and employee costs and timing of incentive accruals of approximately 110 bps. in the lawson-based business the margin compression from the prior year was primarily due to sales mix of about 60 bps higher health employee-related benefit costs of approximately 100 bps and employee costs and timing of incentive accruals of approximately 110 bps As Bryan mentioned, Lawson's most significant sales initiatives focus on new VMI installations and increased share of wallet, which are leading indicators of revenue growth. as bryan mentioned lawson's most significant sales initiatives focus on new vmi installations and increased share of wallet which are leading indicators of revenue growth We are continuing to accelerate the adoption of our CRM platform to improve sales rep productivity, grow the core business, and are currently in the early stages of route optimization planning. we are continuing to accelerate the adoption of our crm platform to improve sales rep productivity grow the core business and are currently in the early stages of route optimization planning We are also expanding our e-commerce platform. we are also expanding our e-commerce platform This is a cost-effective way to do business, and 1/3 of our customers on the site are new. this is a cost-effective way to do business and 1/3 of our customers on the site are new Although sales are still small on e-commerce, we experienced about an 18% revenue growth in the fourth quarter. although sales are still small on e-commerce we experienced about an 18% revenue growth in the fourth quarter Turning to slide eight, full-year sales for the Canadian segment were $221.4 million in USD, up $96.3 million, primarily due to the Source Atlantic acquisition included for a partial year in 2024. Fourth quarter sales for the Canadian segment in USD were $55.1 million, reflecting some seasonal softness. Market softness for projects in manufacturing end markets persisted, mostly in Eastern Canada. However, current backlogs have increased meaningfully. full-year Adjusted EBITDA was $15.6 million or 7.1% of sales, while fourth quarter margins were 6.6%. Margins were compressed slightly due to items such as first-year Sarbanes-Oxley compliance work. The Bolt Supply standalone business drove sales by 7.8% in local currency and generated a 14% margin for the full-year. Turning to slide eight, full-year sales for the Canadian segment were $221.4 million in USD, up $96.3 million, primarily due to the Source Atlantic acquisition included for a partial year in 2024. turning to slide eight full-year sales for the canadian segment were $221.4 million in usd up $96.3 million primarily due to the source atlantic acquisition included for a partial year in 2024 Fourth quarter sales for the Canadian segment in USD were $55.1 million, reflecting some seasonal softness. fourth quarter sales for the canadian segment in usd were $55.1 million reflecting some seasonal softness Market softness for projects in manufacturing end markets persisted, mostly in Eastern Canada. market softness for projects in manufacturing end markets persisted mostly in eastern canada However, current backlogs have increased meaningfully. full-year Adjusted EBITDA was $15.6 million or 7.1% of sales, while fourth quarter margins were 6.6%. however current backlogs have increased meaningfully full-year adjusted ebitda was $15.6 million or 7.1% of sales while fourth quarter margins were 6.6% Margins were compressed slightly due to items such as first-year Sarbanes-Oxley compliance work. margins were compressed slightly due to items such as first-year sarbanes-oxley compliance work The Bolt Supply standalone business drove sales by 7.8% in local currency and generated a 14% margin for the full-year. the bolt supply standalone business drove sales by 7.8% in local currency and generated a 14% margin for the full-year We continue to make progress on planned synergies around gross margins and branch consolidations between Bolt and Source Atlantic. Turning to Gexpro Services on slide nine full-year revenue was $496.7 million, representing organic average daily sales growth of 12.3% and total ADS growth of over 13%, driven primarily by end market strength in aerospace and defense, technology, and renewables for most of the year. Recall that we highlighted tougher sales comps in the fourth quarter, which declined 1% on an average daily sales basis, generating $119.4 million. full-year Adjusted EBITDA was $63.7 million or 12.8% of sales. We continue to make progress on planned synergies around gross margins and branch consolidations between Bolt and Source Atlantic. we continue to make progress on planned synergies around gross margins and branch consolidations between bolt and source atlantic Turning to Gexpro Services on slide nine full-year revenue was $496.7 million, representing organic average daily sales growth of 12.3% and total ADS growth of over 13%, driven primarily by end market strength in aerospace and defense, technology, and renewables for most of the year. turning to gexpro services on slide nine full-year revenue was $496.7 million representing organic average daily sales growth of 12.3% and total ads growth of over 13% driven primarily by end market strength in aerospace and defense technology and renewables for most of the year Recall that we highlighted tougher sales comps in the fourth quarter, which declined 1% on an average daily sales basis, generating $119.4 million. full-year Adjusted EBITDA was $63.7 million or 12.8% of sales. recall that we highlighted tougher sales comps in the fourth quarter which declined 1% on an average daily sales basis generating $119.4 million full-year adjusted ebitda was $63.7 million or 12.8% of sales For the quarter, margins pulled back to 11.7% from 13.3% a year ago on a lower Q4 sales base, a sales mix on lower renewables, and some strategic employee investments. Value creation initiatives for Gexpro Services continue to include DSG cross-selling, acquisition synergies, and expanded VMI kitting, manufacturing, and e-commerce offerings. Lastly, I'll turn to TestEquity Group on slide 10. full-year sales were $783.2 million, with average daily sales growth of 2%, driven primarily by test and measurement, rentals, and our chambers business. Organic average daily sales for the year were up 1%. Fourth quarter sales were $192.9 million, with average daily sales up 0.9% versus a year ago. For the quarter, margins pulled back to 11.7% from 13.3% a year ago on a lower Q4 sales base, a sales mix on lower renewables, and some strategic employee investments. for the quarter margins pulled back to 11.7% from 13.3% a year ago on a lower q4 sales base a sales mix on lower renewables and some strategic employee investments Value creation initiatives for Gexpro Services continue to include DSG cross-selling, acquisition synergies, and expanded VMI kitting, manufacturing, and e-commerce offerings. value creation initiatives for gexpro services continue to include dsg cross-selling acquisition synergies and expanded vmi kitting manufacturing and e-commerce offerings Lastly, I'll turn to TestEquity Group on slide 10. full-year sales were $783.2 million, with average daily sales growth of 2%, driven primarily by test and measurement, rentals, and our chambers business. lastly i'll turn to testequity group on slide 10 full-year sales were $783.2 million with average daily sales growth of 2% driven primarily by test and measurement rentals and our chambers business Organic average daily sales for the year were up 1%. organic average daily sales for the year were up 1% Fourth quarter sales were $192.9 million, with average daily sales up 0.9% versus a year ago. fourth quarter sales were $192.9 million with average daily sales up 0.9% versus a year ago TestEquity's Adjusted EBITDA for the year was $51 million, with Adjusted EBITDA margins of 6.5% versus 7.3% for all of 2024. Margins were pressured by a sales mix shift, higher bad debt expense, and higher employee-related expenses, including the build-out of the leadership team and non-recurring favorable items from a year ago. Fourth quarter EBITDA margins were similar as full-year margins at 6.4% of sales. The new leadership team has aligned priorities through performance management, incentives, and accountability. Moving to page 11, we ended the year with total available liquidity of $469 million. For 2025, our free cash flow conversion, defined as Adjusted EBITDA less working capital investment, less CapEx, was approximately 85%. TestEquity's Adjusted EBITDA for the year was $51 million, with Adjusted EBITDA margins of 6.5% versus 7.3% for all of 2024. testequity's adjusted ebitda for the year was $51 million with adjusted ebitda margins of 6.5% versus 7.3% for all of 2024 Margins were pressured by a sales mix shift, higher bad debt expense, and higher employee-related expenses, including the build-out of the leadership team and non-recurring favorable items from a year ago. margins were pressured by a sales mix shift higher bad debt expense and higher employee-related expenses including the build-out of the leadership team and non-recurring favorable items from a year ago Fourth quarter EBITDA margins were similar as full-year margins at 6.4% of sales. fourth quarter ebitda margins were similar as full-year margins at 6.4% of sales The new leadership team has aligned priorities through performance management, incentives, and accountability. the new leadership team has aligned priorities through performance management incentives and accountability Moving to page 11, we ended the year with total available liquidity of $469 million. moving to page 11 we ended the year with total available liquidity of $469 million For 2025, our free cash flow conversion, defined as Adjusted EBITDA less working capital investment, less CapEx, was approximately 85%. for 2025 our free cash flow conversion defined as adjusted ebitda less working capital investment less capex was approximately 85% In December 2025, we expanded our senior secured credit facility through 2030. The new facility includes $700 million of term debt and a $400 million revolving credit arrangement, an increase over the previous $255 million revolver. This puts us in a strong liquidity position to best drive shareholder returns through our capital allocation playbook. We ended the year with unrestricted and restricted cash totaling $75.3 million and net debt leverage of 3.5 times. We continue to prioritize growth initiatives that enable cross-channel and collaborative selling across our customer base, expand our digital capabilities across our platform, and drive growth through an asset-light model. We invested $26.8 million in net CapEx, including rental equipment, and we plan to invest a similar amount of $25 million-$30 million in 2026. In December 2025, we expanded our senior secured credit facility through 2030. The new facility includes $700 million of term debt and a $400 million revolving credit arrangement, an increase over the previous $255 million revolver. in december 2025 we expanded our senior secured credit facility through 2030. the new facility includes $700 million of term debt and a $400 million revolving credit arrangement an increase over the previous $255 million revolver This puts us in a strong liquidity position to best drive shareholder returns through our capital allocation playbook. this puts us in a strong liquidity position to best drive shareholder returns through our capital allocation playbook We ended the year with unrestricted and restricted cash totaling $75.3 million and net debt leverage of 3.5 times. we ended the year with unrestricted and restricted cash totaling $75.3 million and net debt leverage of 3.5 times We continue to prioritize growth initiatives that enable cross-channel and collaborative selling across our customer base, expand our digital capabilities across our platform, and drive growth through an asset-light model. we continue to prioritize growth initiatives that enable cross-channel and collaborative selling across our customer base expand our digital capabilities across our platform and drive growth through an asset-light model We invested $26.8 million in net CapEx, including rental equipment, and we plan to invest a similar amount of $25 million-$30 million in 2026. we invested $26.8 million in net capex including rental equipment and we plan to invest a similar amount of $25 million-$30 million in 2026 As we've highlighted in the past, we have invested nearly $450 million in M&A by acquiring nine highly complementary businesses to expand our portfolio, leverage scale, and grow through product adjacency and services. We closely manage working capital across our businesses, and net working capital was $473.5 million. As we mentioned, DSG generated $84 million of cash from operations for the year, similar to 2024 before retention payments, and a testament to management's close monitoring of our working capital. Our strong cash generation in 2025 positioned us to be more active in share repurchases. In November 2025, the board authorized an increase to our existing stock repurchase program for an additional $30 million in shares of DSG's common stock, taking the total aggregate authorization amount to $67.5 million. As we've highlighted in the past, we have invested nearly $450 million in M&A by acquiring nine highly complementary businesses to expand our portfolio, leverage scale, and grow through product adjacency and services. as we've highlighted in the past we have invested nearly $450 million in m&a by acquiring nine highly complementary businesses to expand our portfolio leverage scale and grow through product adjacency and services We closely manage working capital across our businesses, and net working capital was $473.5 million. we closely manage working capital across our businesses and net working capital was $473.5 million As we mentioned, DSG generated $84 million of cash from operations for the year, similar to 2024 before retention payments, and a testament to management's close monitoring of our working capital. as we mentioned dsg generated $84 million of cash from operations for the year similar to 2024 before retention payments and a testament to management's close monitoring of our working capital Our strong cash generation in 2025 positioned us to be more active in share repurchases. our strong cash generation in 2025 positioned us to be more active in share repurchases In November 2025, the board authorized an increase to our existing stock repurchase program for an additional $30 million in shares of DSG's common stock, taking the total aggregate authorization amount to $67.5 million. in november 2025 the board authorized an increase to our existing stock repurchase program for an additional $30 million in shares of dsg's common stock taking the total aggregate authorization amount to $67.5 million In 2025, we returned $23.5 million to our shareholders through opportunistic share repurchases and have approximately $33 million remaining in the authorized pool. I'll now turn the call back over to Bryan. In 2025, we returned $23.5 million to our shareholders through opportunistic share repurchases and have approximately $33 million remaining in the authorized pool. in 2025 we returned $23.5 million to our shareholders through opportunistic share repurchases and have approximately $33 million remaining in the authorized pool I'll now turn the call back over to Bryan. i'll now turn the call back over to bryan

Speaker 1: Thank you, Ron. Despite external headwinds and periods of demand volatility in 2025, we have a clear line of sight on initiatives well underway to drive sales growth and structurally higher margins. We delivered total revenue growth of almost 10%, reaching just under $2 billion, supported by mid-single-digit organic growth despite the burden on profitability of macroeconomic and policy challenges and an ISM remaining below 50 for all of 2025 and our deliberate investments into the business in 2025. As we enter 2026, our focus is firmly on execution and demonstrating a return to improved profitability with our expected growth while balancing critical long-term value unlocking investments. Our revenue growth strategy prioritize high-margin businesses, strong and sustainable cash flow generation, disciplined capital allocation, and operational excellence. Thank you, Ron. thank you ron Despite external headwinds and periods of demand volatility in 2025, we have a clear line of sight on initiatives well underway to drive sales growth and structurally higher margins. despite external headwinds and periods of demand volatility in 2025 we have a clear line of sight on initiatives well underway to drive sales growth and structurally higher margins We delivered total revenue growth of almost 10%, reaching just under $2 billion, supported by mid-single-digit organic growth despite the burden on profitability of macroeconomic and policy challenges and an ISM remaining below 50 for all of 2025 and our deliberate investments into the business in 2025. we delivered total revenue growth of almost 10% reaching just under $2 billion supported by mid-single-digit organic growth despite the burden on profitability of macroeconomic and policy challenges and an ism remaining below 50 for all of 2025 and our deliberate investments into the business in 2025 As we enter 2026, our focus is firmly on execution and demonstrating a return to improved profitability with our expected growth while balancing critical long-term value unlocking investments. as we enter 2026 our focus is firmly on execution and demonstrating a return to improved profitability with our expected growth while balancing critical long-term value unlocking investments Our revenue growth strategy prioritize high-margin businesses, strong and sustainable cash flow generation, disciplined capital allocation, and operational excellence. our revenue growth strategy prioritize high-margin businesses strong and sustainable cash flow generation disciplined capital allocation and operational excellence We are investing to be a company that is easy to work with and for leveraging digital and AI-enabled capabilities to respond faster to customer needs, improve operational efficiency, strengthen sales rigor, and capture margin opportunities. These efforts are supported by an accelerating level of data-driven insights that guide and improve decision-making and enable us to deliver our differentiated products and solutions while enhancing our customer experience. Operating across more than 50 countries, serving over 220,000 customers with approximately 760,000 unique products requires agility and focus. We remain nimble, ready to pivot when needed to sustain growth while focusing on delivering on improved profitability. We are investing to be a company that is easy to work with and for leveraging digital and AI-enabled capabilities to respond faster to customer needs, improve operational efficiency, strengthen sales rigor, and capture margin opportunities. we are investing to be a company that is easy to work with and for leveraging digital and ai-enabled capabilities to respond faster to customer needs improve operational efficiency strengthen sales rigor and capture margin opportunities These efforts are supported by an accelerating level of data-driven insights that guide and improve decision-making and enable us to deliver our differentiated products and solutions while enhancing our customer experience. these efforts are supported by an accelerating level of data-driven insights that guide and improve decision-making and enable us to deliver our differentiated products and solutions while enhancing our customer experience Operating across more than 50 countries, serving over 220,000 customers with approximately 760,000 unique products requires agility and focus. operating across more than 50 countries serving over 220,000 customers with approximately 760,000 unique products requires agility and focus We remain nimble, ready to pivot when needed to sustain growth while focusing on delivering on improved profitability. we remain nimble ready to pivot when needed to sustain growth while focusing on delivering on improved profitability Our leadership teams are renewing our confidence to shareholders and our colleagues that we are driving and expect growth with enhanced profitability and with a commitment to further tune capabilities and consistent service and culture that emphasizes from our field team around volume and revenue growth from both existing and new customers. I am confident in our enhanced leadership teams and our recent investments in them across all of our verticals and their ability to execute on their re-underwritten priorities and value creation initiatives as they enjoy line of sight on building structurally higher margin and more defensible and growing businesses with a commitment to generate strong free cash flow and an aligned incentive structure around driving accelerating long-term value for our shareholders. Our teams remain highly aligned with the shareholders and each other, collaborating and competing together to continue to win more often. Our leadership teams are renewing our confidence to shareholders and our colleagues that we are driving and expect growth with enhanced profitability and with a commitment to further tune capabilities and consistent service and culture that emphasizes from our field team around volume and revenue growth from both existing and new customers. our leadership teams are renewing our confidence to shareholders and our colleagues that we are driving and expect growth with enhanced profitability and with a commitment to further tune capabilities and consistent service and culture that emphasizes from our field team around volume and revenue growth from both existing and new customers I am confident in our enhanced leadership teams and our recent investments in them across all of our verticals and their ability to execute on their re-underwritten priorities and value creation initiatives as they enjoy line of sight on building structurally higher margin and more defensible and growing businesses with a commitment to generate strong free cash flow and an aligned incentive structure around driving accelerating long-term value for our shareholders. i am confident in our enhanced leadership teams and our recent investments in them across all of our verticals and their ability to execute on their re-underwritten priorities and value creation initiatives as they enjoy line of sight on building structurally higher margin and more defensible and growing businesses with a commitment to generate strong free cash flow and an aligned incentive structure around driving accelerating long-term value for our shareholders Our teams remain highly aligned with the shareholders and each other, collaborating and competing together to continue to win more often. our teams remain highly aligned with the shareholders and each other collaborating and competing together to continue to win more often Each is accountable and appropriately incentivized to deliver results for our shareholders and for DSG and all of our colleagues. We will continue to evaluate acquisitions that strategically fit and enhance our long-term competitive position to win in our current focus areas and markets or that complement them, as well as opportunities that can accelerate our growth and profitability objectives to enhance and accelerate driving long-term shareholder value. In addition to strengthening leadership within our verticals, after a thorough evaluation on ways to improve and enhance our corporate strategy and M&A capabilities, we recruited Sean Dwyer to lead DSG's efforts and dedicated team while working closely with the vertical leadership and our LKCM Headwater teams. Sean comes to us with a background in investment banking and experience leading similar efforts at large public companies. Through his public company roles, he has led over $30 billion in 36 transactions. Each is accountable and appropriately incentivized to deliver results for our shareholders and for DSG and all of our colleagues. each is accountable and appropriately incentivized to deliver results for our shareholders and for dsg and all of our colleagues We will continue to evaluate acquisitions that strategically fit and enhance our long-term competitive position to win in our current focus areas and markets or that complement them, as well as opportunities that can accelerate our growth and profitability objectives to enhance and accelerate driving long-term shareholder value. we will continue to evaluate acquisitions that strategically fit and enhance our long-term competitive position to win in our current focus areas and markets or that complement them as well as opportunities that can accelerate our growth and profitability objectives to enhance and accelerate driving long-term shareholder value In addition to strengthening leadership within our verticals, after a thorough evaluation on ways to improve and enhance our corporate strategy and M&A capabilities, we recruited Sean Dwyer to lead DSG's efforts and dedicated team while working closely with the vertical leadership and our LKCM Headwater teams. in addition to strengthening leadership within our verticals after a thorough evaluation on ways to improve and enhance our corporate strategy and m&a capabilities we recruited sean dwyer to lead dsg's efforts and dedicated team while working closely with the vertical leadership and our lkcm headwater teams Sean comes to us with a background in investment banking and experience leading similar efforts at large public companies. sean comes to us with a background in investment banking and experience leading similar efforts at large public companies Through his public company roles, he has led over $30 billion in 36 transactions. through his public company roles he has led over $30 billion in 36 transactions It's great to have Sean on board to add structure, perspective, and to collaboratively lead this critical component of DSG's growth strategy. As we look ahead in 2026, we're excited about the added capabilities, discipline, and prioritization we've invested in across all our verticals. While most of this comes at a cost It's great to have Sean on board to add structure, perspective, and to collaboratively lead this critical component of DSG's growth strategy. it's great to have sean on board to add structure perspective and to collaboratively lead this critical component of dsg's growth strategy As we look ahead in 2026, we're excited about the added capabilities, discipline, and prioritization we've invested in across all our verticals. as we look ahead in 2026 we're excited about the added capabilities discipline and prioritization we've invested in across all our verticals While most of this comes at a cost while most of this comes at a cost We're confident in these investments and in the improved performance returns the investments will deliver. While the first couple of months of 2026 have seen sales growth, we expect the first quarter to remain under margin pressure as we continue to digest initiatives, and then we expect to see an improved margin expansion trajectory consistent with our longer-term objectives as we move into the middle of the year. I'm proud of the heavy lifting from our colleagues and what it accomplished in 2025. As I reflect on where we are versus the much smaller and less evolved DSG that we pulled together four years ago, we remain focused building a better DSG on its many commercial growth initiatives and ongoing process and structure optimization. We celebrate working together to build a more valuable enterprise, one that consistently generates cash flow and long-term shareholder value. We're confident in these investments and in the improved performance returns the investments will deliver. we're confident in these investments and in the improved performance returns the investments will deliver While the first couple of months of 2026 have seen sales growth, we expect the first quarter to remain under margin pressure as we continue to digest initiatives, and then we expect to see an improved margin expansion trajectory consistent with our longer-term objectives as we move into the middle of the year. while the first couple of months of 2026 have seen sales growth we expect the first quarter to remain under margin pressure as we continue to digest initiatives and then we expect to see an improved margin expansion trajectory consistent with our longer-term objectives as we move into the middle of the year I'm proud of the heavy lifting from our colleagues and what it accomplished in 2025. i'm proud of the heavy lifting from our colleagues and what it accomplished in 2025 As I reflect on where we are versus the much smaller and less evolved DSG that we pulled together four years ago, we remain focused building a better DSG on its many commercial growth initiatives and ongoing process and structure optimization. as i reflect on where we are versus the much smaller and less evolved dsg that we pulled together four years ago we remain focused building a better dsg on its many commercial growth initiatives and ongoing process and structure optimization We celebrate working together to build a more valuable enterprise, one that consistently generates cash flow and long-term shareholder value. we celebrate working together to build a more valuable enterprise one that consistently generates cash flow and long-term shareholder value Finally, I wanna thank our employees for their dedication and hard work throughout the year. Your commitment and the strength of our culture have enabled meaningful progress across our strategic priorities. We will continue to push, test, and adapt as we improve long-term performance. I also wanna thank DSG's board, our shareholders, our shareholder partners, and the LKCM Headwater Team as we continue advancing our specialty distribution model together. And with that, operator, will you please open the line for questions? Finally, I wanna thank our employees for their dedication and hard work throughout the year. finally i wanna thank our employees for their dedication and hard work throughout the year Your commitment and the strength of our culture have enabled meaningful progress across our strategic priorities. your commitment and the strength of our culture have enabled meaningful progress across our strategic priorities We will continue to push, test, and adapt as we improve long-term performance. we will continue to push test and adapt as we improve long-term performance I also wanna thank DSG's board, our shareholders, our shareholder partners, and the LKCM Headwater Team as we continue advancing our specialty distribution model together. i also wanna thank dsg's board our shareholders our shareholder partners and the lkcm headwater team as we continue advancing our specialty distribution model together And with that, operator, will you please open the line for questions? and with that operator will you please open the line for questions

Speaker 4: Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your phone at this time. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Your first question for today is from Tommy Moll with Stephens. Certainly. certainly At this time, we will be conducting a question and answer session. at this time we will be conducting a question and answer session If you would like to ask a question, please press star one on your phone at this time. if you would like to ask a question please press star one on your phone at this time A confirmation tone will indicate your line is in the question queue. a confirmation tone will indicate your line is in the question queue You may press star two if you would like to remove your question from the queue. you may press star two if you would like to remove your question from the queue For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. for participants using speaker equipment it may be necessary to pick up your handset before pressing the star keys One moment please while we poll for questions. one moment please while we poll for questions Your first question for today is from Tommy Moll with Stephens. your first question for today is from tommy moll with stephens

Speaker 5: Morning, Tommy. Morning, Tommy. morning tommy

Speaker 7: Morning. Yeah. Good morning, Bryan. How are you? Morning. morning Yeah. yeah Good morning, Bryan. good morning bryan How are you? how are you

Speaker 5: Morning, Tommy. I'm all right. Morning, Tommy. morning tommy I'm all right. i'm all right

Speaker 7: Thanks for the time. Bryan, I want to start on the comment you just made regarding the sales pacing year-to-date. I think I heard you say sales are up year-over-year in January and February. Maybe just can you confirm that? If you're able to give us the daily sales pacing and the number of selling days for the quarter, that would be appreciated as well. Thanks for the time. thanks for the time Bryan, I want to start on the comment you just made regarding the sales pacing year-to-date. bryan i want to start on the comment you just made regarding the sales pacing year-to-date I think I heard you say sales are up year-over-year in January and February. i think i heard you say sales are up year-over-year in january and february Maybe just can you confirm that? maybe just can you confirm that If you're able to give us the daily sales pacing and the number of selling days for the quarter, that would be appreciated as well. if you're able to give us the daily sales pacing and the number of selling days for the quarter that would be appreciated as well

Speaker 5: Yeah. Let me, Yeah. yeah Let me, let me

Speaker 1: I'm gonna let Ron do it. He's got them in front of him. I'm gonna let Ron do it. i'm gonna let ron do it He's got them in front of him. he's got them in front of him

Speaker 5: Yeah, Tommy. Yeah, good morning, Tommy. This is Ron Knutson. Yeah, Tommy. yeah tommy Yeah, good morning, Tommy. yeah good morning tommy This is Ron Knutson. this is ron knutson

Speaker 1: Eamon. It's Tommy. Eamon. eamon It's Tommy. it's tommy

Speaker 5: Yeah. Yeah. yeah

Speaker 1: Ron. Hey, Tommy, it's on. Ron. ron Hey, Tommy, it's on. hey tommy it's on

Speaker 5: Just to add some commentary around Bryan's notes relative to the first two months of the year. We have seen growth, you know, really, I would say I'd put it, you know, in the low single digits. You know, if we look at January, February versus a year ago, you know, ADS so far for the first two months, you know, kind of flattish versus Q4 but up against a year ago. We're seeing a little bit of pressure continue within our Canadian branch business that I think both Bryan and I commented on in our prepared remarks. Just to add some commentary around Bryan's notes relative to the first two months of the year. just to add some commentary around bryan's notes relative to the first two months of the year We have seen growth, you know, really, I would say I'd put it, you know, in the low single digits. we have seen growth you know really i would say i'd put it you know in the low single digits You know, if we look at January, February versus a year ago, you know, ADS so far for the first two months, you know, kind of flattish versus Q4 but up against a year ago. you know if we look at january february versus a year ago you know ads so far for the first two months you know kind of flattish versus q4 but up against a year ago We're seeing a little bit of pressure continue within our Canadian branch business that I think both Bryan and I commented on in our prepared remarks. we're seeing a little bit of pressure continue within our canadian branch business that i think both bryan and i commented on in our prepared remarks The other, the other verticals or the other, you know, three pieces of business are seeing some growth here in the first couple of months. You know, relative to, I think the second part of your question was relative to number of days and so forth as 26 develops. On a quarter-over-quarter basis, it shifts a little bit just because of the kind of the waiting, and we've got Gexpro Services on a 4-4-5. But essentially, it's relatively consistent. First quarter of 26 has 63 selling days versus the first quarter of 25 having 63 as well. The other, the other verticals or the other, you know, three pieces of business are seeing some growth here in the first couple of months. the other the other verticals or the other you know three pieces of business are seeing some growth here in the first couple of months You know, relative to, I think the second part of your question was relative to number of days and so forth as 26 develops. you know relative to i think the second part of your question was relative to number of days and so forth as 26 develops On a quarter-over-quarter basis, it shifts a little bit just because of the kind of the waiting, and we've got Gexpro Services on a 4-4-5. on a quarter-over-quarter basis it shifts a little bit just because of the kind of the waiting and we've got gexpro services on a 4-4-5 But essentially, it's relatively consistent. but essentially it's relatively consistent First quarter of 26 has 63 selling days versus the first quarter of 25 having 63 as well. first quarter of 26 has 63 selling days versus the first quarter of 25 having 63 as well

Speaker 1: Tommy I just would add. Oh, is it Tommy? Tommy I just would add. tommy i just would add Oh, is it Tommy? oh is it tommy

Speaker 5: Who's he? Who's he? who's he

Speaker 1: I thought it's... I thought you said it was Eamon. I was like, "Wait a second." Tommy, what one of the things I was referencing when I said that was that we were it was on the TestEquity vertical, and that was that we were seeing some backlog build there in orders and, you know, kind of RFPs. Momentum on and it's really around the test and measurement side, which we've seen with as we've seen some messaging from the manufacturers about a little bit of accelerated activity in that space. I mean, January, quite, you know, transparently, I wasn't happy with the flow-through of, on profitability, relative to how we budgeted or what I expected. I thought it's... i thought it's I thought you said it was Eamon. i thought you said it was eamon I was like, "Wait a second." Tommy, what one of the things I was referencing when I said that was that we were it was on the TestEquity vertical, and that was that we were seeing some backlog build there in orders and, you know, kind of RFPs. i was like "wait a second." tommy what one of the things i was referencing when i said that was that we were it was on the testequity vertical and that was that we were seeing some backlog build there in orders and you know kind of rfps Momentum on and it's really around the test and measurement side, which we've seen with as we've seen some messaging from the manufacturers about a little bit of accelerated activity in that space. momentum on and it's really around the test and measurement side which we've seen with as we've seen some messaging from the manufacturers about a little bit of accelerated activity in that space I mean, January, quite, you know, transparently, I wasn't happy with the flow-through of, on profitability, relative to how we budgeted or what I expected. i mean january quite you know transparently i wasn't happy with the flow-through of on profitability relative to how we budgeted or what i expected As the fourth quarter came together in the first month of the year, while we saw some revenue lift, we still suffered some of the same challenges of adding expenses around leadership and otherwise in the first month. We're seeing improvement on that, we believe in February and expect that again in March. The re-leveraging of our cost structure with the pickup in revenue. There just were some changeover expenses that, and some one-times and some things that created noises in the fourth quarter and in January. As the fourth quarter came together in the first month of the year, while we saw some revenue lift, we still suffered some of the same challenges of adding expenses around leadership and otherwise in the first month. as the fourth quarter came together in the first month of the year while we saw some revenue lift we still suffered some of the same challenges of adding expenses around leadership and otherwise in the first month We're seeing improvement on that, we believe in February and expect that again in March. we're seeing improvement on that we believe in february and expect that again in march The re-leveraging of our cost structure with the pickup in revenue. the re-leveraging of our cost structure with the pickup in revenue There just were some changeover expenses that, and some one-times and some things that created noises in the fourth quarter and in January. there just were some changeover expenses that and some one-times and some things that created noises in the fourth quarter and in january

Speaker 7: Yeah. Bryan, you anticipated my follow-up, which was on margin. You clarified your comment, maybe I could put a finer point on it here. Yeah. yeah Bryan, you anticipated my follow-up, which was on margin. bryan you anticipated my follow-up which was on margin You clarified your comment, maybe I could put a finer point on it here. you clarified your comment maybe i could put a finer point on it here

Speaker 5: Okay. Okay. okay

Speaker 1: If I go back. If I go back. if i go back

Speaker 5: I got it. I got it. i got it

Speaker 7: ... the numbers that Ron gave us in the prepared remarks, there were a series of one-timers in Q4. I just added up all those basis points, and it was about 150 basis points. My starting point on bridging was I just took, the 7.4 you reported in Q4 plus 150 gets you 8.9% as an implied baseline to start to think about the first quarter. That would be up a little bit year-over-year, though. ... the numbers that Ron gave us in the prepared remarks, there were a series of one-timers in Q4. the numbers that ron gave us in the prepared remarks there were a series of one-timers in q4 I just added up all those basis points, and it was about 150 basis points. i just added up all those basis points and it was about 150 basis points My s tarting point on bridging was I just took, the 7.4 you reported in Q4 plus 150 gets you 8.9% as an implied baseline to start to think about the first quarter. my s tarting point on bridging was i just took the 7.4 you reported in q4 plus 150 gets you 8.9% as an implied baseline to start to think about the first quarter That would be up a little bit year-over-year, though. that would be up a little bit year-over-year though

Speaker 1: Yeah Yeah yeah

Speaker 7: ... based on what you just said, that makes me think perhaps that's a bit too aggressive of a, of a baseline. I don't know. It depends on the monthly assumptions. Anything you can do to tighten up expectations would help. ... based on what you just said, that makes me think perhaps that's a bit too aggressive of a, of a baseline. based on what you just said that makes me think perhaps that's a bit too aggressive of a of a baseline I don't know. i don't know It depends on the monthly assumptions. it depends on the monthly assumptions Anything you can do to tighten up expectations would help. anything you can do to tighten up expectations would help

Speaker 1: Yeah, that number would be consistent with how margins flowed through for the year last year. When we look at it or when I look at it, the first quarter's still gonna have a little bit more margin degradation from our average last year, I think. Whereas the second and third quarters, we would expect that the EBITDA margin will be back towards above what last year's average was, if that's helpful. Yeah, that number would be consistent with how margins flowed through for the year last year. yeah that number would be consistent with how margins flowed through for the year last year When we look at it or when I look at it, the first quarter's still gonna have a little bit more margin degradation from our average last year, I think. when we look at it or when i look at it the first quarter's still gonna have a little bit more margin degradation from our average last year i think Whereas the second and third quarters, we would expect that the EBITDA margin will be back towards above what last year's average was, if that's helpful. whereas the second and third quarters we would expect that the ebitda margin will be back towards above what last year's average was if that's helpful

Speaker 7: Yep. Yep. yep

Speaker 1: Is that right, Ron? Is that right, Ron? is that right ron

Speaker 7: Very much. Very much. very much

Speaker 1: I'm looking at you, Ron. I'm looking at you, Ron. i'm looking at you ron

Speaker 5: Yeah. Yeah, that, yeah, that is, that is right. Yeah. yeah Yeah, that, yeah, that is, that is right. yeah that yeah that is that is right

Speaker 1: You might be able to say that better. You might be able to say that better. you might be able to say that better

Speaker 5: Yeah. If, if I go back, Q1 of 2025, we were sitting at about 9%. Tommy, we typically, you know, we do get burdened with some other items that we didn't call out specifically in our comments, you know, around some, you know, payroll taxes start over on us. You know, that typically, you know, drags our margins a little bit even going from Q4 into Q1. The other area that I would point to is we do have some resetting of some incentive accruals and so forth. As you can imagine, you know, lower dollars in 2025 based upon performance. Yeah. yeah If, if I go back, Q1 of 2025, we were sitting at about 9%. if if i go back q1 of 2025 we were sitting at about 9% Tommy, we typically, you know, we do get burdened with some other items that we didn't call out specifically in our comments, you know, around some, you know, payroll taxes start over on us. tommy we typically you know we do get burdened with some other items that we didn't call out specifically in our comments you know around some you know payroll taxes start over on us You know, that typically, you know, drags our margins a little bit even going from Q4 into Q1. you know that typically you know drags our margins a little bit even going from q4 into q1 The other area that I would point to is we do have some resetting of some incentive accruals and so forth. the other area that i would point to is we do have some resetting of some incentive accruals and so forth As you can imagine, you know, lower dollars in 2025 based upon performance. as you can imagine you know lower dollars in 2025 based upon performance We certainly budget to hit higher goals, you know, going into the next year. We'll have to reestablish, you know, some of those accruals as we work throughout the year as well. Those typically get spread, you know, pretty evenly throughout the year until we, you know, start to reforecast to a greater degree, you know, later in the year. We do have some, what I would call, you know, kinda offsets, or, you know, negative items that'll probably push their way through here yet in the first quarter. We certainly budget to hit higher goals, you know, going into the next year. we certainly budget to hit higher goals you know going into the next year We'll have to reestablish, you know, some of those accruals as we work throughout the year as well. we'll have to reestablish you know some of those accruals as we work throughout the year as well Those typically get spread, you know, pretty evenly throughout the year until we, you know, start to reforecast to a greater degree, you know, later in the year. those typically get spread you know pretty evenly throughout the year until we you know start to reforecast to a greater degree you know later in the year We do have some, what I would call, you know, kinda offsets, or, you know, negative items that'll probably push their way through here yet in the first quarter. we do have some what i would call you know kinda offsets or you know negative items that'll probably push their way through here yet in the first quarter

Speaker 1: I would say, Tommy, the exercise you did, which is the same one I did yesterday when I was preparing my remarks, by adding up Ron's remarks, which had were prepared ahead of mine. I did the same bridge you did, and then kinda tried to double-check it against looking at where we were for the quarter so far. Directionally, you're right on. I think it's just gonna be a little not quite. January is not indicating to me that we're gonna get to where you the level you said. I would say, Tommy, the exercise you did, which is the same one I did yesterday when I was preparing my remarks, by adding up Ron's remarks, which had were prepared ahead of mine. i would say tommy the exercise you did which is the same one i did yesterday when i was preparing my remarks by adding up ron's remarks which had were prepared ahead of mine I did the same bridge you did, and then kinda tried to double-check it against looking at where we were for the quarter so far. i did the same bridge you did and then kinda tried to double-check it against looking at where we were for the quarter so far Directionally, you're right on. directionally you're right on I think it's just gonna be a little not quite. i think it's just gonna be a little not quite January is not indicating to me that we're gonna get to where you the level you said. january is not indicating to me that we're gonna get to where you the level you said

Speaker 7: Understood. Shifting to some more strategic questions here on TestEquity. Understood. understood Shifting to some more strategic questions here on TestEquity. shifting to some more strategic questions here on testequity

Speaker 1: Yeah. Yeah. yeah

Speaker 7: You have new leadership there, and you've talked before and again today about refining the customer value prop to go to market, centralizing some functions, et cetera. What can you share there about the progress to date and what's ahead in 2026? You have new leadership there, and you've talked before and again today about refining the customer value prop to go to market, centralizing some functions, et cetera. you have new leadership there and you've talked before and again today about refining the customer value prop to go to market centralizing some functions et cetera What can you share there about the progress to date and what's ahead in 2026? what can you share there about the progress to date and what's ahead in 2026

Speaker 1: Look, the pacing on the team and the, and the, and the depth of our leadership, bench is, and is just very different than it has been. You know, part of that was, that we, you know, adding Barry was critical, but, you know, it was not just adding Barry. Barry brought with him, you know, an ensemble of other executives, we were able to really keep, you know, so many of the people that we had that were in, you know, had key, institutional knowledge and that we had a lot of confidence around. We did double up, you know, some of our leadership expense. When I look at the total burden at the top of that company, it's different than it was, four or five months ago. Look, the pacing on the team and the, and the, and the depth of our leadership, bench is, and is just very different than it has been. look the pacing on the team and the and the and the depth of our leadership bench is and is just very different than it has been You know, part of that was, that we, you know, adding Barry was critical, but, you know, it was not just adding Barry. you know part of that was that we you know adding barry was critical but you know it was not just adding barry Barry brought with him, you know, an ensemble of other executives, we were able to really keep, you know, so many of the people that we had that were in, you know, had key, institutional knowledge and that we had a lot of confidence around. barry brought with him you know an ensemble of other executives we were able to really keep you know so many of the people that we had that were in you know had key institutional knowledge and that we had a lot of confidence around We did double up, you know, some of our leadership expense. we did double up you know some of our leadership expense When I look at the total burden at the top of that company, it's different than it was, four or five months ago. when i look at the total burden at the top of that company it's different than it was four or five months ago With that has come a real, you know, high level of, not only cadence is different and the pacing is different, but there's a high level of kinda drill-down insight, which, you know, Russ and Mark had been doing last year, increasingly for us. After we made the ConRes acquisition, you know, we were able to really get a lot more accountability around the efficiency in our rental and used business and our calibration strategy. Our chambers business has been taken off, and so we've been trying to build out our chambers offering and portfolio and our inventory and stock. With that has come a real, you know, high level of, not only cadence is different and the pacing is different, but there's a high level of kinda drill-down insight, which, you know, Russ and Mark had been doing last year, increasingly for us. with that has come a real you know high level of not only cadence is different and the pacing is different but there's a high level of kinda drill-down insight which you know russ and mark had been doing last year increasingly for us After we made the ConRes acquisition, you know, we were able to really get a lot more accountability around the efficiency in our rental and used business and our calibration strategy. after we made the conres acquisition you know we were able to really get a lot more accountability around the efficiency in our rental and used business and our calibration strategy Our chambers business has been taken off, and so we've been trying to build out our chambers offering and portfolio and our inventory and stock. our chambers business has been taken off and so we've been trying to build out our chambers offering and portfolio and our inventory and stock Then we've been working through kind of a more cohesive strategy around the total tested measurement go-to-market, kinda value proposition to the customer, so it's not just as isolated to margins on new product. Then on top of that, we have a lot of smaller value-added capabilities that are inside of the TestEquity Group, some of which came with Hisco and some of which were ones that we'd acquired. So by breaking them each apart and really drilling accountability and ownership on each of those verticals, we're able to see very different contribution margins amongst different ones. Then we've been working through kind of a more cohesive strategy around the total tested measurement go-to-market, kinda value proposition to the customer, so it's not just as isolated to margins on new product. then we've been working through kind of a more cohesive strategy around the total tested measurement go-to-market kinda value proposition to the customer so it's not just as isolated to margins on new product Then on top of that, we have a lot of smaller value-added capabilities that are inside of the TestEquity Group, some of which came with Hisco and some of which were ones that we'd acquired. then on top of that we have a lot of smaller value-added capabilities that are inside of the testequity group some of which came with hisco and some of which were ones that we'd acquired So by breaking them each apart and really drilling accountability and ownership on each of those verticals, we're able to see very different contribution margins amongst different ones. so by breaking them each apart and really drilling accountability and ownership on each of those verticals we're able to see very different contribution margins amongst different ones You know, our, you know, of our EPS business, you know, we've got parts of it that are more commodity, that are volume, but our cost, our channel support to that is similar to our more discrete specialty parts of the same EPS business. The flow-through margin on those look quite a bit different. The team is really, you know, re-energizing the sales force on how they're spending their time and how we're delivering our messaging to the marketplace and to our employees around where the levers are to pull a lot more attention and acceleration through the parts of the business that have very different structural contribution margins. That's just... You know, our, you know, of our EPS business, you know, we've got parts of it that are more commodity, that are volume, but our cost, our channel support to that is similar to our more discrete specialty parts of the same EPS business. you know our you know of our eps business you know we've got parts of it that are more commodity that are volume but our cost our channel support to that is similar to our more discrete specialty parts of the same eps business The flow-through margin on those look quite a bit different. the flow-through margin on those look quite a bit different The team is really, you know, re-energizing the sales force on how they're spending their time and how we're delivering our messaging to the marketplace and to our employees around where the levers are to pull a lot more attention and acceleration through the parts of the business that have very different structural contribution margins. the team is really you know re-energizing the sales force on how they're spending their time and how we're delivering our messaging to the marketplace and to our employees around where the levers are to pull a lot more attention and acceleration through the parts of the business that have very different structural contribution margins That's just... that's just You know, that energy and that focus kinda started, you know, 100 days ago. It's trickling down through the organization, more recently. We, our chief commercial officer, who's been real important to the business, we made our president of Mexico for all of DSG so that we could start to really bring our cadence together across all three of our verticals, in Mexico so that we could have more cross-sell wins and drive total revenue growth. That's the business that he had built for Hisco. Then we added another chief commercial officer at the senior executive level, to really focus on these lines of business efforts. You know, that energy and that focus kinda started, you know, 100 days ago. you know that energy and that focus kinda started you know 100 days ago It's trickling down through the organization, more recently. it's trickling down through the organization more recently We, our chief commercial officer, who's been real important to the business, we made our president of Mexico for all of DSG so that we could start to really bring our cadence together across all three of our verticals, in Mexico so that we could have more cross-sell wins and drive total revenue growth. we our chief commercial officer who's been real important to the business we made our president of mexico for all of dsg so that we could start to really bring our cadence together across all three of our verticals in mexico so that we could have more cross-sell wins and drive total revenue growth That's the business that he had built for Hisco. that's the business that he had built for hisco Then we added another chief commercial officer at the senior executive level, to really focus on these lines of business efforts. then we added another chief commercial officer at the senior executive level to really focus on these lines of business efforts You know, it, Barry's got a lot of confidence in, all the specialty businesses that we have and how it all rolls together, and some of the profitability that is inside of that business has been masked by some of the areas that, have been whipping around or where we've, you know, either had too high cost to serve relative to the contribution margin and not enough focus on the areas with our sales force on much higher contribution margin opportunities. We're seeing that shift, so. You know, it, Barry's got a lot of confidence in, all the specialty businesses that we have and how it all rolls together, and some of the profitability that is inside of that business has been masked by some of the areas that, have been whipping around or where we've, you know, either had too high cost to serve relative to the contribution margin and not enough focus on the areas with our sales force on much higher contribution margin opportunities. you know it barry's got a lot of confidence in all the specialty businesses that we have and how it all rolls together and some of the profitability that is inside of that business has been masked by some of the areas that have been whipping around or where we've you know either had too high cost to serve relative to the contribution margin and not enough focus on the areas with our sales force on much higher contribution margin opportunities We're seeing that shift, so. we're seeing that shift so

Speaker 7: Bryan, Ron, I'll turn it back and appreciate the insight. Bryan, Ron, I'll turn it back and appreciate the insight. bryan ron i'll turn it back and appreciate the insight

Speaker 1: Thank you, Tommy. Appreciate your time. Thank you, Tommy. thank you tommy Appreciate your time. appreciate your time Thanks, bud. Thanks, bud. thanks bud

Speaker 4: Your next question for today is from Ken Newman with KeyBanc. Your next question for today is from Ken Newman with KeyBanc. your next question for today is from ken newman with keybanc

Speaker 1: Hi, Ken. Hi, Ken. hi ken

Speaker 2: Hey, good morning, guys. Hey, good morning, guys. hey good morning guys

Speaker 1: Good morning, guys. Good morning, guys. good morning guys

Speaker 2: Hey, this is Katie on for Jenny. Hey, this is Katie on for Jenny. hey this is katie on for jenny

Speaker 1: Oh, hey, Ken. Oh, hey, Ken. oh hey ken Hi, Ken Hi, Ken hi ken

Speaker 2: Hey. I was wondering if we could start on tariffs and if you're anticipating any material impacts from the recent news and how you're thinking about price cost as we go into 2026? Hey. hey I was wondering if we could start on tariffs and if you're anticipating any material impacts from the recent news and how you're thinking about price cost as we go into 2026? i was wondering if we could start on tariffs and if you're anticipating any material impacts from the recent news and how you're thinking about price cost as we go into 2026

Speaker 5: Yeah. Yeah. yeah

Speaker 1: Why don't you start that off? Why don't you start that off? why don't you start that off

Speaker 5: Yeah, I'll start it off. I know, I know we've talked about, you know, tariffs in the past, you know, relative to, you know, the value of the imports that we, that we do and so forth, and our ability, you know, to be able to pass along, you know, the majority of those, you know, from a, from a customer relationship standpoint. I think your question is probably more pointed towards the recent news and so forth. I would say probably too early to tell yet in terms of, you know, what direct impact, you know, that may or may not have on DSG. Certainly we're evaluating, you know, the situation, you know, trying to, trying to stay really current with it as others are as well. Yeah, I'll start it off. yeah i'll start it off I know, I know we've talked about, you know, tariffs in the past, you know, relative to, you know, the value of the imports that we, that we do and so forth, and our ability, you know, to be able to pass along, you know, the majority of those, you know, from a, from a customer relationship standpoint. i know i know we've talked about you know tariffs in the past you know relative to you know the value of the imports that we that we do and so forth and our ability you know to be able to pass along you know the majority of those you know from a from a customer relationship standpoint I think your question is probably more pointed towards the recent news and so forth. i think your question is probably more pointed towards the recent news and so forth I would say probably too early to tell yet in terms of, you know, what direct impact, you know, that may or may not have on DSG. i would say probably too early to tell yet in terms of you know what direct impact you know that may or may not have on dsg Certainly we're evaluating, you know, the situation, you know, trying to, trying to stay really current with it as others are as well. certainly we're evaluating you know the situation you know trying to trying to stay really current with it as others are as well You know, at this point we're, you know, moving the business forward, you know, assuming that, you know, a lot of these costs that have come through to us, you know, the last, you know, call it 12-18 months, will probably continue to be out there, until we get some further direction on where this may end up. You know, at this point we're, you know, moving the business forward, you know, assuming that, you know, a lot of these costs that have come through to us, you know, the last, you know, call it 12-18 months, will probably continue to be out there, until we get some further direction on where this may end up. you know at this point we're you know moving the business forward you know assuming that you know a lot of these costs that have come through to us you know the last you know call it 12-18 months will probably continue to be out there until we get some further direction on where this may end up

Speaker 1: Ken we've got a consulting firm that we use, are using across our portfolio companies at LKCM Headwater, and we have some businesses that have been much more significantly impacted than DSG. It's allowed us to be informed, you know, across ways and levers that we should pull and also how to, you know, navigate or engage on those SCOTUS recent rulings. Ken we've got a consulting firm that we use, are using across our portfolio companies at LKCM Headwater, and we have some businesses that have been much more significantly impacted than DSG. ken we've got a consulting firm that we use are using across our portfolio companies at lkcm headwater and we have some businesses that have been much more significantly impacted than dsg It's allowed us to be informed, you know, across ways and levers that we should pull and also how to, you know, navigate or engage on those SCOTUS recent rulings. it's allowed us to be informed you know across ways and levers that we should pull and also how to you know navigate or engage on those scotus recent rulings We ended up leaving some dollars on the table last year for sure, but our team did a great job of managing both pricing as well as sourcing costs and where we source things across DSG. So much of it was mitigated by the end of the year. You know, we did end up with certainly a drag on earnings or much of it was mitigated as we looked out perspectively for this year by actions that were taken throughout last year. We ended up leaving some dollars on the table last year for sure, but our team did a great job of managing both pricing as well as sourcing costs and where we source things across DSG. we ended up leaving some dollars on the table last year for sure but our team did a great job of managing both pricing as well as sourcing costs and where we source things across dsg So much of it was mitigated by the end of the year. so much of it was mitigated by the end of the year You know, we did end up with certainly a drag on earnings or much of it was mitigated as we looked out perspectively for this year by actions that were taken throughout last year. you know we did end up with certainly a drag on earnings or much of it was mitigated as we looked out perspectively for this year by actions that were taken throughout last year Now we've got to kinda look and see whether or not there's any additional moves that we need to make or whether or not there's gonna be additional shifting in where the tariff burdens are gonna be, and whether or not that's gonna inform any of our sourcing decisions this year or pricing decisions this year or whether or not we're contesting or protesting that we believe that we should get any refund. Right now it's really early to try and know how that's gonna work. Now we've got to kinda look and see whether or not there's any additional moves that we need to make or whether or not there's gonna be additional shifting in where the tariff burdens are gonna be, and whether or not that's gonna inform any of our sourcing decisions this year or pricing decisions this year or whether or not we're contesting or protesting that we believe that we should get any refund. now we've got to kinda look and see whether or not there's any additional moves that we need to make or whether or not there's gonna be additional shifting in where the tariff burdens are gonna be and whether or not that's gonna inform any of our sourcing decisions this year or pricing decisions this year or whether or not we're contesting or protesting that we believe that we should get any refund Right now it's really early to try and know how that's gonna work. right now it's really early to try and know how that's gonna work Okay. That's helpful. Just revisiting Tommy's question a little bit on some trends that we've seen year-to-date. Any other color that you're able to provide on the segments, and then maybe for Lawson specifically, you know, how are you thinking about these mixed impacts within that segment, and should those normalize as we move through the year? Okay. okay That's helpful. that's helpful Just revisiting Tommy's question a little bit on some trends that we've seen year- to -date. just revisiting tommy's question a little bit on some trends that we've seen year- to -date Any other color that you're able to provide on the segments, and then maybe for Lawson specifically, you know, how are you thinking about these mixed impacts within that segment, and should those normalize as we move through the year? any other color that you're able to provide on the segments and then maybe for lawson specifically you know how are you thinking about these mixed impacts within that segment and should those normalize as we move through the year You know, I'll start with Gexpro Services. That one's pretty easy. You know, Gexpro Services has got several key end markets that are spooling up. The power generation space has obviously gotten a lot of attention. It's a key area for that business and its legacy or its history coming out of GE. It'll enjoy some leverage there to the positive. The aerospace and defense vertical is very important to it. We know what's going on around the world, so, you know, there's, you know, we expect a firm year there and with growth. The domestic renewables business, you know, we're about two-thirds domestic, one-third international historically. You know, I'll start with Gexpro Services. you know i'll start with gexpro services That one's pretty easy. that one's pretty easy You know, Gexpro Services has got several key end markets that are spooling up. you know gexpro services has got several key end markets that are spooling up The power generation space has obviously gotten a lot of attention. the power generation space has obviously gotten a lot of attention It's a key area for that business and its legacy or its history coming out of GE. it's a key area for that business and its legacy or its history coming out of ge It'll enjoy some leverage there to the positive. it'll enjoy some leverage there to the positive The aerospace and defense vertical is very important to it. the aerospace and defense vertical is very important to it We know what's going on around the world, so, you know, there's, you know, we expect a firm year there and with growth. we know what's going on around the world so you know there's you know we expect a firm year there and with growth The domestic renewables business, you know, we're about two-thirds domestic, one-third international historically. the domestic renewables business you know we're about two-thirds domestic one-third international historically The domestic business is down. We really started to see it tick down in the fourth quarter, kind of mid fourth quarter, I guess. That trend is continuing. At the same time, as we're seeing, you know, countries like India, where we had $4 million of revenue on renewables, is kind of tracking towards. That's two years ago, kind of 2024, I think we were $4 million, is what I remember looking at, and this year will be 14. We're backfilling, you know, with our capabilities, with our manufacturing our vendor partners and some of the renewable developers, you know, programs around the world that are backfilling, but not entirely backfilling. The domestic business is down. the domestic business is down We really started to see it tick down in the fourth quarter, kind of mid fourth quarter, I guess. we really started to see it tick down in the fourth quarter kind of mid fourth quarter i guess That trend is continuing. that trend is continuing At the same time, as we're seeing, you know, countries like India, where we had $4 million of revenue on renewables, is kind of tracking towards. at the same time as we're seeing you know countries like india where we had $4 million of revenue on renewables is kind of tracking towards That's two years ago, kind of 2024, I think we were $4 million, is what I remember looking at, and this year will be 14. that's two years ago kind of 2024 i think we were $4 million is what i remember looking at and this year will be 14 We're backfilling, you know, with our capabilities, with our manufacturing our vendor partners and some of the renewable developers, you know, programs around the world that are backfilling, but not entirely backfilling. we're backfilling you know with our capabilities with our manufacturing our vendor partners and some of the renewable developers you know programs around the world that are backfilling but not entirely backfilling There's also some different contribution margin dynamics as you spool up new relationships like Gexpro, as I alluded to, relative to, you know, the contribution margin on a more mature vertical or customer engagement. As we're taking on more opportunities at Gexpro Services, which is happening more broadly than just renewables, there's some launch costs that are associated with that. We do believe that Gexpro Services margins that we've seen throughout last year are consistent with how we think that business is kind of gonna continue to operate. We don't expect a, you know, a significant deterioration in the EBITDA margin at Gexpro Services this year at all. We think it's kind of operating without a lot of headroom up this year, but operating at a level that we think is about consistent with where we expect it'll be this year. There's also some different contribution margin dynamics as you spool up new relationships like Gexpro, as I alluded to, relative to, you know, the contribution margin on a more mature vertical or customer engagement. there's also some different contribution margin dynamics as you spool up new relationships like gexpro as i alluded to relative to you know the contribution margin on a more mature vertical or customer engagement As we're taking on more opportunities at Gexpro Services, which is happening more broadly than just renewables, there's some launch costs that are associated with that. as we're taking on more opportunities at gexpro services which is happening more broadly than just renewables there's some launch costs that are associated with that We do believe that Gexpro Services margins that we've seen throughout last year are consistent with how we think that business is kind of gonna continue to operate. we do believe that gexpro services margins that we've seen throughout last year are consistent with how we think that business is kind of gonna continue to operate We don't expect a, you know, a significant deterioration in the EBITDA margin at Gexpro Services this year at all. we don't expect a you know a significant deterioration in the ebitda margin at gexpro services this year at all We think it's kind of operating without a lot of headroom up this year, but operating at a level that we think is about consistent with where we expect it'll be this year. we think it's kind of operating without a lot of headroom up this year but operating at a level that we think is about consistent with where we expect it'll be this year On the TestEquity side or TestEquity side, as I alluded to earlier, we're seeing strong interest in the test and measurement equipment. Our apps business is continuing to see some softness. Our electronic production supplies, you know, one of the key areas is our electronic or tech manufacturing. Ron, help me with that. Is that. I'm kind of trying to remember how we call that vertical. The, you know, that has been an area that has been really soft for us and we've seen some firmness in it last year. I can't remember where our backlog looks right now there, but it's the biggest part of TestEquity Group's apps business. The Chambers business is very strong. On the TestEquity side or TestEquity side, as I alluded to earlier, we're seeing strong interest in the test and measurement equipment. on the testequity side or testequity side as i alluded to earlier we're seeing strong interest in the test and measurement equipment Our apps business is continuing to see some softness. our apps business is continuing to see some softness Our electronic production supplies, you know, one of the key areas is our electronic or tech manufacturing. our electronic production supplies you know one of the key areas is our electronic or tech manufacturing Ron, help me with that. ron help me with that Is that. is that I'm kind of trying to remember how we call that vertical. i'm kind of trying to remember how we call that vertical The, you know, that has been an area that has been really soft for us and we've seen some firmness in it last year. the you know that has been an area that has been really soft for us and we've seen some firmness in it last year I can't remember where our backlog looks right now there, but it's the biggest part of TestEquity Group's apps business. i can't remember where our backlog looks right now there but it's the biggest part of testequity group's apps business The Chambers business is very strong. the chambers business is very strong The rental and used market is getting more attention or focus for us 'cause it has a lot higher contribution margin. It's been, you know, it was a source of strength last year and with renewed strength. Some of that's focus and some of that's the acceleration in demand in the input in markets on the test and measurement side. What else, Ron? Lawson? The rental and used market is getting more attention or focus for us 'cause it has a lot higher contribution margin. the rental and used market is getting more attention or focus for us 'cause it has a lot higher contribution margin It's been, you know, it was a source of strength last year and with renewed strength. it's been you know it was a source of strength last year and with renewed strength Some of that's focus and some of that's the acceleration in demand in the input in markets on the test and measurement side. some of that's focus and some of that's the acceleration in demand in the input in markets on the test and measurement side What else, Ron? what else ron Lawson? lawson

Speaker 5: Yeah. Yeah. yeah

Speaker 1: That it? That it? that it

Speaker 5: Yeah. relative to Lawson and, you know, what I would say around that is, we continue to see an increase in our, what we call ship-to or VMI installations, in particular in the, in our larger locations, you know, within, you know, strategic relationships, and within our Kent Automotive business. I would say a renewed focus on the core or local business, where, you know, historically, if you look at the last couple of years, that's where the most pressure is, has been seen. We've seen, I would say, kind of flattening out in ship-to's there. Yeah. relative to Lawson and, you know, what I would say around that is, we continue to see an increase in our, what we call ship-to or VMI installations, in particular in the, in our larger locations, you know, within, you know, strategic relationships, and within our Kent Automotive business. yeah relative to lawson and you know what i would say around that is we continue to see an increase in our what we call ship-to or vmi installations in particular in the in our larger locations you know within you know strategic relationships and within our kent automotive business I would say a renewed focus on the core or local business, where, you know, historically, if you look at the last couple of years, that's where the most pressure is, has been seen. i would say a renewed focus on the core or local business where you know historically if you look at the last couple of years that's where the most pressure is has been seen We've seen, I would say, kind of flattening out in ship-to's there. we've seen i would say kind of flattening out in ship-to's there As Bryan mentioned, we had our sales leadership meeting in mid-February and a ton of focus being put on reallocating resources to be able to grow that piece of the business, which makes up that local business, we call it core as well, is about 45% of Lawson's total revenue. Again, Lawson is seen on an overall basis, some increase here, you know, moving from, you know, January, February. As Bryan mentioned, we had our sales leadership meeting in mid-February and a ton of focus being put on reallocating resources to be able to grow that piece of the business, which makes up that local business, we call it core as well, is about 45% of Lawson's total revenue. as bryan mentioned we had our sales leadership meeting in mid-february and a ton of focus being put on reallocating resources to be able to grow that piece of the business which makes up that local business we call it core as well is about 45% of lawson's total revenue Again, Lawson is seen on an overall basis, some increase here, you know, moving from, you know, January, February. again lawson is seen on an overall basis some increase here you know moving from you know january february We've got great insight into number of locations and, you know, around specific customer wins, and the accountability that Bryan and I have mentioned around making sure that those sites get installed on a monthly basis, with Jim's, with Jim coming on board here in January, a renewed focus around that, making sure that we hit those numbers as well. We've got great insight into number of locations and, you know, around specific customer wins, and the accountability that Bryan and I have mentioned around making sure that those sites get installed on a monthly basis, with Jim's, with Jim coming on board here in January, a renewed focus around that, making sure that we hit those numbers as well. we've got great insight into number of locations and you know around specific customer wins and the accountability that bryan and i have mentioned around making sure that those sites get installed on a monthly basis with jim's with jim coming on board here in january a renewed focus around that making sure that we hit those numbers as well

Speaker 2: Got it. That's it for me. Thanks. Got it. got it That's it for me. that's it for me Thanks. thanks

Speaker 5: Thanks, Ken. Thanks, Ken. thanks ken

Speaker 4: Your next question for today is from Kevin Steinke with Barrington Research. Your next question for today is from Kevin Steinke with Barrington Research. your next question for today is from kevin steinke with barrington research

Speaker 3: Great. Thank you, and good morning. Great. great Thank you, and good morning. thank you and good morning

Speaker 1: Morning, Kevin. Morning, Kevin. morning kevin

Speaker 5: Hey, Kevin. Hey, Kevin. hey kevin

Speaker 3: Hey, just wanted to follow up on the earlier margin discussion. I believe in response to one of the earlier questions, you mentioned that you thought the second and third quarter Adjusted EBITDA margin could be above the full-year 2025 average of 8.9%. You're thinking kind of a, you know, nine-ish, is appropriate for, you know, second and third quarters? Hey, just wanted to follow up on the earlier margin discussion. hey just wanted to follow up on the earlier margin discussion I believe in response to one of the earlier questions, you mentioned that you thought the second and third quarter Adjusted EBITDA margin could be above the full-year 2025 average of 8.9%. i believe in response to one of the earlier questions you mentioned that you thought the second and third quarter adjusted ebitda margin could be above the full-year 2025 average of 8.9% You're thinking kind of a, you know, nine-ish, is appropriate for, you know, second and third quarters? you're thinking kind of a you know nine-ish is appropriate for you know second and third quarters

Speaker 1: I think we believe it's gonna be relevered up higher than that, Ron. I think we believe it's gonna be relevered up higher than that, Ron. i think we believe it's gonna be relevered up higher than that ron

Speaker 5: Okay. Okay. okay

Speaker 1: I think that I'm trying to remember where we are around there, but if you look at last year, our second and third quarter EBITDA margins were above that 8.9%. I think we expect that it'll be consistent with that or above. Can you remember? Is that right, Ron? I think that I'm trying to remember where we are around there, but if you look at last year, our second and third quarter EBITDA margins were above that 8.9%. i think that i'm trying to remember where we are around there but if you look at last year our second and third quarter ebitda margins were above that 8.9% I think we expect that it'll be consistent with that or above. i think we expect that it'll be consistent with that or above Can you remember? can you remember Is that right, Ron? is that right ron

Speaker 5: Yeah. Yeah. I think where we're gonna see probably the most pressure, as we've commented on is really here in the first quarter. Then you're correct, Bryan, you know, relative to second and third, would be an acceleration, you know, north of what we posted for the full-year. Typically that, you know, that's not unusual. I mean, typically, you know, for us, the second and the third quarters are typically the strongest quarters. In fact, you know, even that, you know, that uplift, you know, generally starts in March. You know, March can be one, it's a longer month, in terms of selling days, so we get some additional operating leverage there. Yeah. yeah Yeah. yeah I think where we're gonna see probably the most pressure, as we've commented on is really here in the first quarter. i think where we're gonna see probably the most pressure as we've commented on is really here in the first quarter Then you're correct, Bryan, you know, relative to second and third, would be an acceleration, you know, north of what we posted for the full-year. then you're correct bryan you know relative to second and third would be an acceleration you know north of what we posted for the full-year Typically that, you know, that's not unusual. typically that you know that's not unusual I mean, typically, you know, for us, the second and the third quarters are typically the strongest quarters. i mean typically you know for us the second and the third quarters are typically the strongest quarters In fact, you know, even that, you know, that uplift, you know, generally starts in March. in fact you know even that you know that uplift you know generally starts in march You know, March can be one, it's a longer month, in terms of selling days, so we get some additional operating leverage there. you know march can be one it's a longer month in terms of selling days so we get some additional operating leverage there Typically, you know, Q3, if you look back historically, Q3, Q2 and Q3 are typically the strongest uplift in sales as well as overall margin percentages. Typically, you know, Q3, if you look back historically, Q3, Q2 and Q3 are typically the strongest uplift in sales as well as overall margin percentages. typically you know q3 if you look back historically q3 q2 and q3 are typically the strongest uplift in sales as well as overall margin percentages

Speaker 1: I just looked back at it, and last year's Q2 was 9.7%, and Q3 was 9.4%. Versus the 9% last year in the first quarter and the 7.4%. I just looked back at it, and last year's Q2 was 9.7%, and Q3 was 9.4%. i just looked back at it and last year's q2 was 9.7% and q3 was 9.4% Versus the 9% last year in the first quarter and the 7.4%. versus the 9% last year in the first quarter and the 7.4%

Speaker 5: Right Right right

Speaker 1: that we posted in the fourth quarter. That's kinda gives you some sense of how the quarters fit in together. I think we've got a good number of selling days in the... Is it in the second quarter, Ron, or is it March? I'm trying to remember. that we posted in the fourth quarter. that we posted in the fourth quarter That's kinda gives you some sense of how the quarters fit in together. that's kinda gives you some sense of how the quarters fit in together I think we've got a good number of selling days in the... i think we've got a good number of selling days in the Is it in the second quarter, Ron, or is it March? is it in the second quarter ron or is it march I'm trying to remember. i'm trying to remember

Speaker 5: In March, there's, I think it's either 22 or 23 days in the month of March. Q2 and Q3 both have 64 selling days. In March, there's, I think it's either 22 or 23 days in the month of March. in march there's i think it's either 22 or 23 days in the month of march Q2 and Q3 both have 64 selling days. q2 and q3 both have 64 selling days

Speaker 3: Okay, great. Got it. That's helpful. Appreciate it. I wanted to also follow up on Lawson. You mentioned there some continuing challenges just in the small, you know, the small account side there, maybe, you know, some loss of focus as you've gone through this transition period. You know, I know you've been experimenting with various things there. I think that's to serve the small account customer base and with inside sales force or maybe some service reps who do the unpacking. Are those the sort of things you would still wanna continue to work on? I know you also mentioned e-commerce. Or is it just more kinda getting the actual sales rep back on site more frequently? I don't... Any more thoughts on kind of how you, kind of are approaching that dynamic? Okay, great. okay great Got it. got it That's helpful. that's helpful Appreciate it. appreciate it I wanted to also follow up on Lawson. i wanted to also follow up on lawson You mentioned there some continuing challenges just in the small, you know, the small account side there, maybe, you know, some loss of focus as you've gone through this transition period. you mentioned there some continuing challenges just in the small you know the small account side there maybe you know some loss of focus as you've gone through this transition period You know, I know you've been experimenting with various things there. you know i know you've been experimenting with various things there I think that's to serve the small account customer base and with inside sales force or maybe some service reps who do the unpacking. i think that's to serve the small account customer base and with inside sales force or maybe some service reps who do the unpacking Are those the sort of things you would still wanna continue to work on? are those the sort of things you would still wanna continue to work on I know you also mentioned e-commerce. i know you also mentioned e-commerce Or is it just more kinda getting the actual sales rep back on site more frequently? or is it just more kinda getting the actual sales rep back on site more frequently I don't... i don't Any more thoughts on kind of how you, kind of are approaching that dynamic? any more thoughts on kind of how you kind of are approaching that dynamic

Speaker 1: You just kinda wander through all of them, which is great. You just kinda wander through all of them, which is great. you just kinda wander through all of them which is great

Speaker 5: That's what I was gonna say, Bryan. All of the above. That's what I was gonna say, Bryan. that's what i was gonna say bryan All of the above. all of the above

Speaker 1: Ron and I are laughing or smiling because, you know, you're right. Yes. I would say that the shift to some tiny customers to that were too small to service with the cost to serve of having a rep go see them because their order flow dynamics and the size they're invoicing was too small to, you know, have somebody there unpacking and managing stuff. I think our inside sales group and our e-commerce efforts have really helped that. I think that our revenue there is not where we've really lost volumes. Ron and I are laughing or smiling because, you know, you're right. ron and i are laughing or smiling because you know you're right Yes. yes I would say that the shift to some tiny customers to that were too small to service with the cost to serve of having a rep go see them because their order flow dynamics and the size they're invoicing was too small to, you know, have somebody there unpacking and managing stuff. i would say that the shift to some tiny customers to that were too small to service with the cost to serve of having a rep go see them because their order flow dynamics and the size they're invoicing was too small to you know have somebody there unpacking and managing stuff I think our inside sales group and our e-commerce efforts have really helped that. i think our inside sales group and our e-commerce efforts have really helped that I think that our revenue there is not where we've really lost volumes. i think that our revenue there is not where we've really lost volumes We may have lost some ship-to locations, but I think, Ron, if I remember correctly, we've actually seen pretty good traction out of that total effort, even though we may have had some small ship-tos. Those are not the ones that we're missing. We had, you know, with the, with the compression of our sales force that we did two years ago as we were getting set for the new sales force initiatives that we were putting in place and the technology tools, and the way that we're trying to drive productivity out of our teams. We, you know, we certainly saw with that some of our smaller core customers not get the level of service that we would expect. We may have lost some ship-to locations, but I think, Ron, if I remember correctly, we've actually seen pretty good traction out of that total effort, even though we may have had some small ship-tos. we may have lost some ship-to locations but i think ron if i remember correctly we've actually seen pretty good traction out of that total effort even though we may have had some small ship-tos Those are not the ones that we're missing. those are not the ones that we're missing We had, you know, with the, with the compression of our sales force that we did two years ago as we were getting set for the new sales force initiatives that we were putting in place and the technology tools, and the way that we're trying to drive productivity out of our teams. we had you know with the with the compression of our sales force that we did two years ago as we were getting set for the new sales force initiatives that we were putting in place and the technology tools and the way that we're trying to drive productivity out of our teams We, you know, we certainly saw with that some of our smaller core customers not get the level of service that we would expect. we you know we certainly saw with that some of our smaller core customers not get the level of service that we would expect We had less salespeople, and as you might imagine, the salespeople that we had covered the bigger customers or the strategic accounts, the national accounts that we were trying to make sure we were doing a great job for across the country, first. So that caused a natural, you know, trend of losing some of our ship-to locations that just had less volume in them. And, you know, a real concern on our part at the leadership level on whether or not our salespeople were with that compression and then with the, you know, distraction of a lot more strategic and new national accounts, were spending as much time focused on the smaller street business that they used to, you know, make a lot of their money on. We had less salespeople, and as you might imagine, the salespeople that we had covered the bigger customers or the strategic accounts, the national accounts that we were trying to make sure we were doing a great job for across the country, first. we had less salespeople and as you might imagine the salespeople that we had covered the bigger customers or the strategic accounts the national accounts that we were trying to make sure we were doing a great job for across the country first So that caused a natural, you know, trend of losing some of our ship-to locations that just had less volume in them. so that caused a natural you know trend of losing some of our ship-to locations that just had less volume in them And, you know, a real concern on our part at the leadership level on whether or not our salespeople were with that compression and then with the, you know, distraction of a lot more strategic and new national accounts, were spending as much time focused on the smaller street business that they used to, you know, make a lot of their money on. and you know a real concern on our part at the leadership level on whether or not our salespeople were with that compression and then with the you know distraction of a lot more strategic and new national accounts were spending as much time focused on the smaller street business that they used to you know make a lot of their money on Ron and Mike DeCata started the national account or strategic account initiative about a decade ago, and it's grown to where it's as large as a part of our business as our street business is from zero. We're feeding our salespeople, you know, those national accounts. In some ways, that maybe was creating some behavioral challenges that we didn't appreciate until we got more insights out of the CRM. Now with, you know, kind of, the insights that better data analytics are allowing us to see and how we're keeping up with some of those smaller accounts. Ron and Mike DeCata started the national account or strategic account initiative about a decade ago, and it's grown to where it's as large as a part of our business as our street business is from zero. ron and mike decata started the national account or strategic account initiative about a decade ago and it's grown to where it's as large as a part of our business as our street business is from zero We're feeding our salespeople, you know, those national accounts. we're feeding our salespeople you know those national accounts In some ways, that maybe was creating some behavioral challenges that we didn't appreciate until we got more insights out of the CRM. in some ways that maybe was creating some behavioral challenges that we didn't appreciate until we got more insights out of the crm Now with, you know, kind of, the insights that better data analytics are allowing us to see and how we're keeping up with some of those smaller accounts. now with you know kind of the insights that better data analytics are allowing us to see and how we're keeping up with some of those smaller accounts We went out in the market and did a bunch of feedback surveys that we needed to have at my level and our investment team level to be able to triangulate with our leadership team what we were hearing in the market from a lot of those smaller accounts. Now we've got a very proactive initiative around it, and we're seeing a re-lift back in those base accounts, at least the ship-to number. But it's been after several years of significant declines in locations. You know, you don't see it in the top line as much because you're picking up the strategic accounts and you're getting more volume through those bigger relationships. We went out in the market and did a bunch of feedback surveys that we needed to have at my level and our investment team level to be able to triangulate with our leadership team what we were hearing in the market from a lot of those smaller accounts. we went out in the market and did a bunch of feedback surveys that we needed to have at my level and our investment team level to be able to triangulate with our leadership team what we were hearing in the market from a lot of those smaller accounts Now we've got a very proactive initiative around it, and we're seeing a re-lift back in those base accounts, at least the ship-to number. now we've got a very proactive initiative around it and we're seeing a re-lift back in those base accounts at least the ship-to number But it's been after several years of significant declines in locations. but it's been after several years of significant declines in locations You know, you don't see it in the top line as much because you're picking up the strategic accounts and you're getting more volume through those bigger relationships. you know you don't see it in the top line as much because you're picking up the strategic accounts and you're getting more volume through those bigger relationships When you get down at the profitability level on a mix shift basis, especially if your cost to serve from a commission perspective or a cost for your salesperson is the same, you know, we get a more premium pricing out of the smaller accounts than what we do out of the bigger accounts, so that you're giving up some gross or some product margin, and then you're losing some flow-through contribution margin that if you just kind of held pat on that would have significantly changed the, you know, the total top-line revenue growth and the profitability of the business. All that was at the same time as we were investing significant amount of dollars into the company and into the sales force. When you get down at the profitability level on a mix shift basis, especially if your cost to serve from a commission perspective or a cost for your salesperson is the same, you know, we get a more premium pricing out of the smaller accounts than what we do out of the bigger accounts, so that you're giving up some gross or some product margin, and then you're losing some flow-through contribution margin that if you just kind of held pat on that would have significantly changed the, you know, the total top-line revenue growth and the profitability of the business. when you get down at the profitability level on a mix shift basis especially if your cost to serve from a commission perspective or a cost for your salesperson is the same you know we get a more premium pricing out of the smaller accounts than what we do out of the bigger accounts so that you're giving up some gross or some product margin and then you're losing some flow-through contribution margin that if you just kind of held pat on that would have significantly changed the you know the total top-line revenue growth and the profitability of the business All that was at the same time as we were investing significant amount of dollars into the company and into the sales force. all that was at the same time as we were investing significant amount of dollars into the company and into the sales force You saw, you know, if you go back two years on Lawson, you know, you've seen, you know, we've got less revenue today on our MRO business than we had two years ago. We've got more today than we had last year. That, you know, most of that decrease really came out of those smaller accounts and the flow-through on that at the same time as you were investing in paying your sales force more, offering them more tools, and putting dollars back into it, caused a de-levering dynamic at the same time as we were making a deliberate investment. There was a swing in profitability there that we felt in the fourth quarter more acutely than we had in the prior fourth quarter. You saw, you know, if you go back two years on Lawson, you know, you've seen, you know, we've got less revenue today on our MRO business than we had two years ago. you saw you know if you go back two years on lawson you know you've seen you know we've got less revenue today on our mro business than we had two years ago We've got more today than we had last year. we've got more today than we had last year That, you know, most of that decrease really came out of those smaller accounts and the flow-through on that at the same time as you were investing in paying your sales force more, offering them more tools, and putting dollars back into it, caused a de-levering dynamic at the same time as we were making a deliberate investment. that you know most of that decrease really came out of those smaller accounts and the flow-through on that at the same time as you were investing in paying your sales force more offering them more tools and putting dollars back into it caused a de-levering dynamic at the same time as we were making a deliberate investment There was a swing in profitability there that we felt in the fourth quarter more acutely than we had in the prior fourth quarter. there was a swing in profitability there that we felt in the fourth quarter more acutely than we had in the prior fourth quarter We knew what we were doing. We also knew that there was gonna be a J-curve as we were investing back in the sales force after that compression period of getting, you know, those sellers back out there into those territories that were either open or had been, you know, consolidated. Go ahead, Ron. You, you live this very much daily at Lawson. We knew what we were doing. we knew what we were doing We also knew that there was gonna be a J-curve as we were investing back in the sales force after that compression period of getting, you know, those sellers back out there into those territories that were either open or had been, you know, consolidated. we also knew that there was gonna be a j-curve as we were investing back in the sales force after that compression period of getting you know those sellers back out there into those territories that were either open or had been you know consolidated Go ahead, Ron. go ahead ron You, you live this very much daily at Lawson. you you live this very much daily at lawson

Speaker 5: Yeah. Kevin, the only thing I would add to Bryan's comments, one is, you know, our strategic business, really sticky business. You know, we've got great customer relationships, you know, servicing, you know, multi-site locations. Drives, you know, really, solid, sticky gross margin dollars, back to us. We love that part of the business and, you know, continues to, we continue to expand it and continue to make, you know, make investments there to win new accounts as well. You know, relative to the core, the core local customers, if we do look at, you know, ship-to's over the last year or so, you know, they've really been, I would say, kind of flattish. Yeah. yeah Kevin, the only thing I would add to Bryan's comments, one is, you know, our strategic business, really sticky business. kevin the only thing i would add to bryan's comments one is you know our strategic business really sticky business You know, we've got great customer relationships, you know, servicing, you know, multi-site locations. you know we've got great customer relationships you know servicing you know multi-site locations Drives, you know, really, solid, sticky gross margin dollars, back to us. drives you know really solid sticky gross margin dollars back to us We love that part of the business and, you know, continues to, we continue to expand it and continue to make, you know, make investments there to win new accounts as well. we love that part of the business and you know continues to we continue to expand it and continue to make you know make investments there to win new accounts as well You know, relative to the core, the core local customers, if we do look at, you know, ship-to's over the last year or so, you know, they've really been, I would say, kind of flattish. you know relative to the core the core local customers if we do look at you know ship-to's over the last year or so you know they've really been i would say kind of flattish Most of that decrease that we experienced within our core local customer counts, you know, took place, you know, prior to the beginning of 2025. Now it's about, as I mentioned, you know, they make, you know, they're about 45% of our total revenue. You know, to Bryan's point, it's putting, you know, some headwinds against the total sales growth that we see, and now it's a renewed focus on making sure that we can get, you know, that 45% of our revenue customer, base growing again. There's change in incentives and focus and even at the sales leadership meeting that I mentioned a couple of weeks ago, a lot of focus around where that business historically had been, where we sit today, and where we need to take it in the future with our sales leaders. Most of that decrease that we experienced within our core local customer counts, you know, took place, you know, prior to the beginning of 2025. most of that decrease that we experienced within our core local customer counts you know took place you know prior to the beginning of 2025 Now it's about, as I mentioned, you know, they make, you know, they're about 45% of our total revenue. now it's about as i mentioned you know they make you know they're about 45% of our total revenue You know, to Bryan's point, it's putting, you know, some headwinds against the total sales growth that we see, and now it's a renewed focus on making sure that we can get, you know, that 45% of our revenue customer, base growing again. you know to bryan's point it's putting you know some headwinds against the total sales growth that we see and now it's a renewed focus on making sure that we can get you know that 45% of our revenue customer base growing again There's change in incentives and focus and even at the sales leadership meeting that I mentioned a couple of weeks ago, a lot of focus around where that business historically had been, where we sit today, and where we need to take it in the future with our sales leaders. there's change in incentives and focus and even at the sales leadership meeting that i mentioned a couple of weeks ago a lot of focus around where that business historically had been where we sit today and where we need to take it in the future with our sales leaders

Speaker 1: I'd add I wanna add two things there because I think you asked the breadth and the complexity of the question you asked was great, but I wanna make sure I hit these other points. You asked about other support services or capabilities that we put in the field. We definitely have made a real investment. We're working on it in some key markets, but we're adding some service reps and some focused, you know, new account sellers, if you will, or re-engagement sellers. I'd add I wanna add two things there because I think you asked the breadth and the complexity of the question you asked was great, but I wanna make sure I hit these other points. i'd add i wanna add two things there because i think you asked the breadth and the complexity of the question you asked was great but i wanna make sure i hit these other points You asked about other support services or capabilities that we put in the field. you asked about other support services or capabilities that we put in the field We definitely have made a real investment. we definitely have made a real investment We're working on it in some key markets, but we're adding some service reps and some focused, you know, new account sellers, if you will, or re-engagement sellers. we're working on it in some key markets but we're adding some service reps and some focused you know new account sellers if you will or re-engagement sellers Not the field sales reps that we've got historically, but to support those field sales reps so that they have the time to get back in front of some of these customers that they've not spent as much time in front of by having these service reps support them on some of their higher volume relationships so that they aren't having to go by and see the account twice. If you think about the way that we often serve our, even our high volume customers, like those national accounts, you know, where they're going in and they're scanning the bins, they're putting in an order, and then they're coming back a couple of days later, and they're breaking open boxes, and they're reorganizing and reloading all those cabinets. Not the field sales reps that we've got historically, but to support those field sales reps so that they have the time to get back in front of some of these customers that they've not spent as much time in front of by having these service reps support them on some of their higher volume relationships so that they aren't having to go by and see the account twice. not the field sales reps that we've got historically but to support those field sales reps so that they have the time to get back in front of some of these customers that they've not spent as much time in front of by having these service reps support them on some of their higher volume relationships so that they aren't having to go by and see the account twice If you think about the way that we often serve our, even our high volume customers, like those national accounts, you know, where they're going in and they're scanning the bins, they're putting in an order, and then they're coming back a couple of days later, and they're breaking open boxes, and they're reorganizing and reloading all those cabinets. if you think about the way that we often serve our even our high volume customers like those national accounts you know where they're going in and they're scanning the bins they're putting in an order and then they're coming back a couple of days later and they're breaking open boxes and they're reorganizing and reloading all those cabinets That's that, you know, labor component that we sell as part of our value-added, our critical part of our value proposition to our customers, by having a service tech, you know, do a route and efficiently go by those customers and help take one of those stops out, then we're opening up the opportunity for those sales reps to spend more time back in the field, servicing those customers that maybe were either smaller on the street level or some of the national accounts that we're adding, that need, you know, kind of, early touch points high or, making sure that we're getting more wallet share out of them and getting them stood up on their initial, kind of, building out of their program. That's that, you know, labor component that we sell as part of our value-added, our critical part of our value proposition to our customers, by having a service tech, you know, do a route and efficiently go by those customers and help take one of those stops out, then we're opening up the opportunity for those sales reps to spend more time back in the field, servicing those customers that maybe were either smaller on the street level or some of the national accounts that we're adding, that need, you know, kind of, early touch points high or, making sure that we're getting more wallet share out of them and getting them stood up on their initial, kind of, building out of their program. that's that you know labor component that we sell as part of our value-added our critical part of our value proposition to our customers by having a service tech you know do a route and efficiently go by those customers and help take one of those stops out then we're opening up the opportunity for those sales reps to spend more time back in the field servicing those customers that maybe were either smaller on the street level or some of the national accounts that we're adding that need you know kind of early touch points high or making sure that we're getting more wallet share out of them and getting them stood up on their initial kind of building out of their program That's a real focus right now of the business. It's definitely been a cost center. I mean, we've layered that cost in, but it's something that we are seeing strong early indications that that's a model that we wanna continue to lean into to support our FSRs. It allows our FSRs, it allows them to make more money, because it gets their total, You know, total revenue that they can have flow through them up. We think it does a much better job of servicing the customer at a higher level. That's a real focus right now of the business. that's a real focus right now of the business It's definitely been a cost center. it's definitely been a cost center I mean, we've layered that cost in, but it's something that we are seeing strong early indications that that's a model that we wanna continue to lean into to support our FSRs. i mean we've layered that cost in but it's something that we are seeing strong early indications that that's a model that we wanna continue to lean into to support our fsrs It allows our FSRs, it allows them to make more money, because it gets their total, You know, total revenue that they can have flow through them up. it allows our fsrs it allows them to make more money because it gets their total you know total revenue that they can have flow through them up We think it does a much better job of servicing the customer at a higher level. we think it does a much better job of servicing the customer at a higher level What our marketplace surveys have told us is that our customers felt like that too often our sales rep, if they were a smaller account, they just weren't getting the attention or they were being effectively fired by us, not by them. There's a, you know, it was a real message, it was consistent, that we heard, where they were asking for us to come back out and service them again and to give them that consistency of service that they wanted from us. That, you know, maybe over this transition period with our sales force, we haven't as consistently given to the smaller accounts. What our marketplace surveys have told us is that our customers felt like that too often our sales rep, if they were a smaller account, they just weren't getting the attention or they were being effectively fired by us, not by them. what our marketplace surveys have told us is that our customers felt like that too often our sales rep if they were a smaller account they just weren't getting the attention or they were being effectively fired by us not by them There's a, you know, it was a real message, it was consistent, that we heard, where they were asking for us to come back out and service them again and to give them that consistency of service that they wanted from us. there's a you know it was a real message it was consistent that we heard where they were asking for us to come back out and service them again and to give them that consistency of service that they wanted from us That, you know, maybe over this transition period with our sales force, we haven't as consistently given to the smaller accounts. that you know maybe over this transition period with our sales force we haven't as consistently given to the smaller accounts That's, you know, that's been a drag of several percentage points of growth a year the last several years at least, that we've been making up with our national sales efforts. Maybe two years ago, 2023 to 2024, it was a bigger drag 'cause we had that compression with our sales force, then we probably saw, you know, single-digit, mid-single digits, drag on our growth last year out of that, a little bit as well. Is that fair, Rob? You know the numbers. Maybe not quite that. That's, you know, that's been a drag of several percentage points of growth a year the last several years at least, that we've been making up with our national sales efforts. that's you know that's been a drag of several percentage points of growth a year the last several years at least that we've been making up with our national sales efforts Maybe two years ago, 2023 to 2024, it was a bigger drag 'cause we had that compression with our sales force, then we probably saw, you know, single- digit, mid-single digits, drag on our growth last year out of that, a little bit as well. maybe two years ago 2023 to 2024 it was a bigger drag 'cause we had that compression with our sales force then we probably saw you know single- digit mid-single digits drag on our growth last year out of that a little bit as well Is that fair, Rob? is that fair rob You know the numbers. you know the numbers Maybe not quite that. maybe not quite that

Speaker 3: Yeah. Yeah. yeah

Speaker 1: That and That and military. That and That and military. that and that and military

Speaker 3: Yes. Yes. yes

Speaker 1: I ought to caveat that. The military was the other area that we saw a real shift in buying behavior that we're trying to work on re-engaging 'cause they have been historically a really good end market for us. We're still engaged with them, but their behavior shifted significantly in dollar spend over the last year and a half. I ought to caveat that. i ought to caveat that The military was the other area that we saw a real shift in buying behavior that we're trying to work on re-engaging 'cause they have been historically a really good end market for us. the military was the other area that we saw a real shift in buying behavior that we're trying to work on re-engaging 'cause they have been historically a really good end market for us We're still engaged with them, but their behavior shifted significantly in dollar spend over the last year and a half. we're still engaged with them but their behavior shifted significantly in dollar spend over the last year and a half

Speaker 3: Yeah. Sounds good. Well, thank you for all the color on that. Appreciate it. I just wanna lastly ask about the M&A pipeline, given your strong liquidity and the extension and expansion of your credit facility. Looks like you'd be set up to explore and maybe execute on some M&A opportunities. Yeah. yeah Sounds good. sounds good Well, thank you for all the color on that. well thank you for all the color on that Appreciate it. appreciate it I just wanna lastly ask about the M&A pipeline, given your strong liquidity and the extension and expansion of your credit facility. i just wanna lastly ask about the m&a pipeline given your strong liquidity and the extension and expansion of your credit facility Looks like you'd be set up to explore and maybe execute on some M&A opportunities. looks like you'd be set up to explore and maybe execute on some m&a opportunities

Speaker 1: Yeah, we... Look, we highlighted that Sean joined us, you know, maybe 100 days ago or less. He's been a critical addition to our team. We spent, you know, the better part of the last year and a half, really evaluating our, you know, business development or M&A and corporate strategy part of our effort. Our, we had, you know, have a really strong team and colleague that used to work at Headwater that's been on the Gexpro Services side and then, you know, helping lead that effort the last several years. We brought in Sean to, you know, add some additional muscle memory to how to build out a team there. He's significantly increased the funnel. Yeah, we... yeah we Look, we highlighted that Sean joined us, you know, maybe 100 days ago or less. look we highlighted that sean joined us you know maybe 100 days ago or less He's been a critical addition to our team. he's been a critical addition to our team We spent, you know, the better part of the last year and a half, really evaluating our, you know, business development or M&A and corporate strategy part of our effort. we spent you know the better part of the last year and a half really evaluating our you know business development or m&a and corporate strategy part of our effort Our, we had, you know, have a really strong team and colleague that used to work at Headwater that's been on the Gexpro Services side and then, you know, helping lead that effort the last several years. our we had you know have a really strong team and colleague that used to work at headwater that's been on the gexpro services side and then you know helping lead that effort the last several years We brought in Sean to, you know, add some additional muscle memory to how to build out a team there. we brought in sean to you know add some additional muscle memory to how to build out a team there He's significantly increased the funnel. he's significantly increased the funnel In just 100 days, he's gotten a lot of buy-in from the vertical leaders and from our team about where we wanna spend our time and effort. We had a few things last year that were high priorities for us that we had hoped to get done that didn't get done. I'd say that none of them are off the table, but they're, you know, but we just weren't able to get them over the goal line. They've been high priorities for some period of time. In just 100 days, he's gotten a lot of buy-in from the vertical leaders and from our team about where we wanna spend our time and effort. in just 100 days he's gotten a lot of buy-in from the vertical leaders and from our team about where we wanna spend our time and effort We had a few things last year that were high priorities for us that we had hoped to get done that didn't get done. we had a few things last year that were high priorities for us that we had hoped to get done that didn't get done I'd say that none of them are off the table, but they're, you know, but we just weren't able to get them over the goal line. i'd say that none of them are off the table but they're you know but we just weren't able to get them over the goal line They've been high priorities for some period of time. they've been high priorities for some period of time We have, you know, some things that we are focused on right now that are smaller tuck-in acquisitions that significantly bolster some areas of either strength or focus that we've got in a few of our vertical or a couple of our verticals. We would expect that there'll be some small tuck-in acquisitions that we'll be able to get over the goal line over the first half of this year. We have, you know, some things that we are focused on right now that are smaller tuck-in acquisitions that significantly bolster some areas of either strength or focus that we've got in a few of our vertical or a couple of our verticals. we have you know some things that we are focused on right now that are smaller tuck-in acquisitions that significantly bolster some areas of either strength or focus that we've got in a few of our vertical or a couple of our verticals We would expect that there'll be some small tuck-in acquisitions that we'll be able to get over the goal line over the first half of this year. we would expect that there'll be some small tuck-in acquisitions that we'll be able to get over the goal line over the first half of this year

Speaker 3: Okay. Sounds good. Okay. okay Sounds good. sounds good

Speaker 1: Those are important to driving accretive. The ones that I'm thinking of, there's three of them that, you know, that we have prioritized. All three of those would add significantly to the margin constructive of those three verticals. They're small. They're not. These are tuck-ins. Those are important to driving accretive. those are important to driving accretive The ones that I'm thinking of, there's three of them that, you know, that we have prioritized. the ones that i'm thinking of there's three of them that you know that we have prioritized All three of those would add significantly to the margin constructive of those three verticals. all three of those would add significantly to the margin constructive of those three verticals They're small. they're small They're not. they're not These are tuck-ins. these are tuck-ins

Speaker 3: Got it. Understood. Thanks again for all the insight. I'll turn it back over. Got it. got it Understood. understood Thanks again for all the insight. thanks again for all the insight I'll turn it back over. i'll turn it back over

Speaker 1: Thank you for your time and your thoughtful questions. Thank you for your time and your thoughtful questions. thank you for your time and your thoughtful questions

Speaker 5: Thanks, Kevin. Thanks, Kevin. thanks kevin

Speaker 4: We have reached the end of the question and answer session, and I will now turn the call over to Bryan King for closing remarks. We have reached the end of the question and answer session, and I will now turn the call over to Bryan King for closing remarks. we have reached the end of the question and answer session and i will now turn the call over to bryan king for closing remarks

Speaker 1: Appreciate everybody's engagement and your time this morning. We look forward to stronger quarters in the future and I appreciate everybody continuing to be supportive and engage with us. Have a great next several months. Appreciate everybody's engagement and your time this morning. appreciate everybody's engagement and your time this morning We look forward to stronger quarters in the future and I appreciate everybody continuing to be supportive and engage with us. we look forward to stronger quarters in the future and i appreciate everybody continuing to be supportive and engage with us Have a great next several months. have a great next several months

Speaker 4: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation. This concludes today's conference, and you may disconnect your lines at this time. this concludes today's conference and you may disconnect your lines at this time Thank you for your participation. thank you for your participation