Distribution Solutions Group, Inc. · NASDAQ:DSGR
Distribution Solutions — Investor Presentation (May 2022)
24 slides from Distribution Solutions's investor presentation, May 5, 2022
Slide 1: Investor Presentation | May 5, 2022
Investor Presentation | May 5, 2022 NASDAQ: DSGR* *The company will start trading under the new NASDAQ common stock trading symbol “DSGR” commencing Monday, May 9, 2022 DSG Investor Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks an
Slide 3: Distribution Solutions Group
Distribution Solutions Group Powerful Solutions. Proven Results. DSG Investor Presentation
Slide 4: Why Own DSG: Investment Thesis
Why Own DSG: Investment Thesis NASDAQ: DSGR* Aligned Best-in-Class Management Team • Deeply experienced and proven operating company leadership across each focus area • Management team owns ~10% of stock, with LKCM & affiliates owning ~65% Annual Revenues • Equity incentive structure fully aligns ma
Slide 5: What We Do
What We Do (37% of Sales)(1) (29% of Sales)(1) (34% of Sales)(1) MRO Focus OEM Focus Industrial Technologies Focus Leading North American vendor managed Leading global supply chain services and Leading independent North American Test inventory provider of C-parts to the MRO market C-parts provider t
Slide 6: Embedded Growth Opportunities
Embedded Growth Opportunities UNIQUE ORGANIC GROWTH OPPORTUNITIES + SELECTIVE, ACTIONABLE ACQUISITION PROGRAM • In-house Corporate Development team with first-class experience LEVERAGE PLATFORM CAPABILITIES ACROSS CUSTOMER BASE • Well-respected brands viewed as credible acquirors with longstanding r
Slide 7: Aligned and Tenured Leadership
Aligned and Tenured Leadership J. Bryan King Brad Wallace Jacob Smith Ron Knutson Chairman & CEO Partner Partner CFO DSG LKCM Headwater LKCM Headwater DSG With daily strategy and business execution led by best-in-class management teams across each business LAWSON PRODUCTS GEXPRO SERVICES TESTEQUITY
Slide 8: LKCM Headwater Introduction
LKCM Headwater Introduction SIGNIFICANT PRIVATE COMPANY DISTRIBUTION EXPERIENCE • Portfolio of leading distribution businesses in the hose, gasket, belting, seals and flow control markets • Privately owned SEC-registered investment advisor • Founded in 1979 with over 60 investment and other • Value-
Slide 9: Operating Companies
Operating Companies DSG Investor Presentation
Slide 10: Lawson Products
SG DISTRIBUTION » SOLUTIONS CROW
Slide 11: Lawson Products Company Overview
COMPANY OVERVIEW GEOGRAPHIC COVERAGE • Leading service-focused industrial MRO distributor • Employs 1,100+ sales representatives providing providing product through a vendor managed the following: inventory approach • Help customers choose from a wide range of products • Embedded within customer ope
Slide 12: Gexpro Services
4 Gexpro Services SG DISTRIBUTION » SOLUTIONS CROW
Slide 13: Gexpro Services Overview and Blue Chip Customers
COMPANY OVERVIEW CUSTOMER / MARKET OVERVIEW • Leading global supply chain Services and C-Parts provider of highly engineered specified products for manufacturing end users • Specializes in Vendor Managed Inventory (“VMI”), Kitting and field installation Blue Chip service programs • Built to be consi
Slide 14: TestEquity
SG DISTRIBUTION » SOLUTIONS CROW
Slide 15: TestEquity Company and Products Overview
COMPANY OVERVIEW PRODUCTS OVERVIEW • One of the largest authorized distributors of Test & Measurement solutions and electronics production supplies with over 180K products. • Premier value-added distributor of electronic test and measurement solutions and eMRO tools and supplies • “One-stop-shop” of
Slide 16: Financials
Financials Powerful Solutions. Proven Results. DSG Investor Presentation
Slide 17: Combined Adjusted Financial Profile
Combined Adjusted Financial Profile UNAUDITED ACCELERATING GROWTH INCREASING PROFITABILITY Combined Revenue ($mm) (1) Combined Adjusted EBITDA ($mm) (2) $1,175 $1,175 $103 $103 19% 166 15 $987 $88 9% 30 $902 55 396 10 7.6% 67 MRO $69 OEM 6 256 Industrial Technologies 11 347 37 10.7% 1,009 20 88 250
Slide 18: Combined Adjusted Balance Sheet
Combined Adjusted Balance Sheet UNAUDITED COMBINED ADJUSTED BALANCE SHEET(1) (2) ($000s) 3/31/2022 Cash and cash equivalents $21,774 Accounts receivable, net 158,000 • Credit facility led by J.P. Morgan includes a $200M Revolving Inventory, net 237,806 Credit Facility, $250M TLA amortizing 5% per ye
Slide 19: Appendix
Appendix Powerful Solutions. Proven Results. DSG Investor Presentation
Slide 20: GAAP to Non-GAAP Reconciliation-Combined Adjusted EBITDA
GAAP to Non-GAAP Reconciliation-Combined Adjusted EBITDA $ in 000,000's Unaudited 2020 2021 TTM 3/31/22 (a) Represents non-recuring transaction costs related to mergers of Net Income $ 0 $ 4 $ 13 Lawson, TestEquity and Gexpro Services Interest 16 18 20 (b) Represents management fees paid to LKCM whi
Slide 21: GAAP to Non-GAAP Reconciliation-Balance Sheet
GAAP to Non-GAAP Reconciliation-Balance Sheet UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET (in thousands) Actual Actual Actual Pro forma Gexpro Pro forma Combined TestEquity Services Lawson Combined w/Tequipment As of March 31, As of March 31, As of March 31, Merger As of March 31, Merger As
Slide 22: Historical Acquisitions
Historical Acquisitions COMPANY FOCUS STRATEGIC RATIONALE CLOSING DATE REVENUE (1) PURCHASE PRICE ▪ Expanded geographic coverage and expanded customer base with an additional Industrial ~22,000 customer locations January 2017 $45.1 $25.0 Technologies ▪ Complementary value-added products / services (
Slide 23: Questions?
Questions? Visit our websites for more information www.lawsonproducts.com www.testequity.com www.gexproservices.com www.lkcmheadwater.com www.distributionsolutionsgroup.com DSG Investor Presentation
Slide 24: Investor Contacts
Investor Contacts Three Part Advisors, LLC (214) 872-2710 Steven Hooser shooser@threepa.com Sandy Martin smartin@threepa.com 24 DSG Investor Presentation
Distribution Solutions Group — Investor Presentation (May 2022) on 6ix