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Acquisition boosts DMC Global third-quarter sales

BROOMFIELD — Oilfield services provider DMC Global Inc. (Nasdaq: BOOM) saw its third-quarter sales more than double year over year, thanks in large part to top-line additions resulting from its acquisition of architectural building product supplier Arcadia Inc.

Third-quarter sales were $174.5 million, up 160% compared with the third quarter of 2021.

Excluding Arcadia, sales were $93.8 million in the most recent quarter, a 40% increase from the same period last year.

“The increases reflect stronger demand for well perforating products from DynaEnergetics, DMC’s energy products business,” the company said in its quarterly report released last week.

Net income for the third quarter this year was $8.2 million, up from $400,000 in the same period of 2021. 

“All three of our differentiated, asset-light manufacturing businesses reported third quarter sales that exceeded our guidance,” said Kevin Longe, president and CEO. “The results were driven by healthy customer demand within each of our markets, as well as outstanding execution by our global commercial and manufacturing teams.”

DMC Global bought a 60% stake in Arcadia last year for $282.5 million in cash and DMC stock. The company’s plan is to acquire the remaining 40% interest in Arcadia through a three-year put and call option with the entirety of the transaction estimated at just under $470 million.

“This is a milestone transaction for DMC and aligns with our strategy of building a diversified portfolio of industry-leading businesses with differentiated products and services,” DMC Global CEO Kevin Longe said in a prepared statement released in late 2021 when the deal was first announced. “The acquisition of Arcadia will double DMC’s consolidated sales, strengthen our gross margins and provide diversification outside our more cyclical energy and industrial infrastructure markets.”

Source: BizWest