Segment Information

9 Months Ended

Sep. 30, 2025

Note 14 – Segment Information

The Company’s CODM is the Chief Executive Officer of DSG. For each reportable segment, the CODM uses segment operating income (loss) to allocate resources (including employees and financial resources) in a way to manage and grow margins.

The Company has four reporting segments: Lawson, TestEquity, Gexpro Services and Canada Branch Division. A description of our reportable segments is as follows:

Lawson is a distributor of specialty products and services to the industrial, commercial, institutional and governmental MRO marketplace. Lawson primarily distributes MRO products to its customers through a network of sales representatives and an inside sales channel throughout the United States and Canada.

TestEquity is a distributor of test and measurement equipment and solutions, industrial and electronic production supplies, vendor managed inventory programs, and converting, fabrication and adhesive solutions from its leading manufacturer partners supporting the aerospace and defense, wireless and communication, semiconductors, industrial electronics and automotive, and electronics manufacturing industries.

Gexpro Services is a global supply chain solutions provider, specializing in the development of mission critical production line management, aftermarket and field installation programs.

Canada Branch Division combines the operations of our Bolt and Source Atlantic subsidiaries, which distribute industrial MRO supplies, safety products, fasteners, power tools and related value-add services to the Canadian MRO market through the sale of products and services via warehouse shipments and to its walk-up customers through 36 branch locations.

The Company also has an “All Other” category which includes unallocated DSG holding company costs that are not directly attributable to the ongoing operating activities of our reportable segments. There is no revenue associated with the All Other category.

Financial information for the Company’s segments and reconciliations of that information to the unaudited condensed consolidated financial statements is presented below.


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2025		2024		2025		2024
Revenue
Lawson	$	121,549	$	117,957	$	366,324	$	357,261
TestEquity	206,479		195,244		590,298		579,874
Gexpro Services	130,525		116,141		377,237		321,926
Canada Branch Division	59,977		39,092		166,372		66,058
Intersegment revenue elimination	(572)		(415)		(1,807)		(1,478)
Total revenue	$	517,958	$	468,019	$	1,498,424	$	1,323,641

Cost of goods sold
Lawson	$	55,215	$	52,609	$	163,182	$	160,450
TestEquity	162,879		150,958		462,368		447,608
Gexpro Services	89,609		79,493		259,255		221,341
Canada Branch Division	40,471		26,526		111,012		41,936
Intersegment cost of goods sold elimination	(542)		(415)		(1,783)		(1,478)
Total cost of goods sold	$	347,632	$	309,171	$	994,034	$	869,857

Selling, general and administrative expenses
Lawson	$	60,949	$	64,622	$	183,466	$	185,849
TestEquity	40,965		39,957		116,352		133,328
Gexpro Services	27,036		25,105		78,959		75,489
Canada Branch Division	16,012		10,043		49,464		19,276
All Other	1,745		174		5,607		3,954
Total operating expenses	$	146,707	$	139,901	$	433,848	$	417,896

Operating income (loss)
Lawson	$	5,385	$	726	$	19,676	$	10,962
TestEquity	2,635		4,329		11,578		(1,062)
Gexpro Services	13,880		11,543		39,023		25,096
Canada Branch Division	3,494		2,523		5,896		4,846
All Other	(1,775)		(174)		(5,631)		(3,954)
Total operating income (loss)	$	23,619	$	18,947	$	70,542	$	35,888

Reconciliation to income (loss) before income taxes
Interest expense	$	(13,955)	$	(15,160)	$	(42,408)	$	(39,780)

Change in fair value of earnout liabilities	—		(858)		(1,000)		(861)
Other income (expense), net	(1,283)		(15)		(1,377)		82
Income (loss) before income taxes	$	8,381	$	2,914	$	25,757	$	(4,671)

Segment revenue includes revenue from sales to external customers and intersegment revenue from sales transactions between segments. The Company accounts for intersegment sales similar to third party transactions that are conducted on an arm’s-length basis and reflect current market prices. Intersegment revenue is eliminated in consolidation. Segment revenue and the elimination of intersegment revenue was as follows:



(in thousands)	Lawson		TestEquity		Gexpro Services		Canada Branch Division		Elimination		Total
Three Months Ended September 30, 2025
Revenue from external customers	$	121,541	$	206,310	$	130,192	$	59,915	$	—	$	517,958
Intersegment revenue	8		169		333		62		(572)		—
Revenue	$	121,549	$	206,479	$	130,525	$	59,977	$	(572)	$	517,958
Three Months Ended September 30, 2024
Revenue from external customers	$	117,953	$	195,210	$	115,764	$	39,092	$	—	$	468,019
Intersegment revenue	4		34		377		—		(415)		—
Revenue	$	117,957	$	195,244	$	116,141	$	39,092	$	(415)	$	468,019

Nine Months Ended September 30, 2025
Revenue from external customers	$	366,268	$	589,596	$	376,259	$	166,301	$	—	$	1,498,424
Intersegment revenue	56		702		978		71		(1,807)		—
Revenue	$	366,324	$	590,298	$	377,237	$	166,372	$	(1,807)	$	1,498,424
Nine Months Ended September 30, 2024
Revenue from external customers	$	357,204	$	579,721	$	320,658	$	66,058			$	1,323,641
Intersegment revenue	57		153		1,268		—		(1,478)		—
Revenue	$	357,261	$	579,874	$	321,926	$	66,058	$	(1,478)	$	1,323,641

Total assets by segment and long-lived assets by geographic area were as follows:


(in thousands)	September 30, 2025		December 31, 2024
Total assets by segment
Lawson	$	543,100	$	524,077
TestEquity	629,821		654,315
Gexpro Services	351,232		331,811
Canada Branch Division	216,899		199,362
All Other	25,474		17,690
Total	$	1,766,526	$	1,727,255

Long-lived assets by geographic area(1)
United States	$	795,829	$	818,100
Canada	141,668		138,218
Europe	31,459		30,345
Pacific Rim	6,196		4,751
Latin America	3,357		3,615
Other	—		—
Total	$	978,509	$	995,029

(1) Long-lived assets include property, plant and equipment, rental equipment, goodwill, intangibles, right of use operating lease assets, and other assets.

Refer to Note 4 – Revenue Recognition for disaggregated revenue by geographic area.

Capital expenditures and depreciation and amortization by segment were as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2025		2024		2025		2024
Capital expenditures
Lawson	$	2,706	$	1,277	$	7,534	$	3,481
TestEquity	7,357		2,974		16,646		7,715
Gexpro Services	588		1,260		2,974		2,808
Canada Branch Division	528		240		1,491		790
All Other	—		—		—		—
Total	$	11,179	$	5,751	$	28,645	$	14,794

Depreciation and amortization
Lawson	$	6,666	$	6,533	$	20,026	$	18,131
TestEquity	8,220		7,460		24,628		22,751
Gexpro Services	3,541		3,840		10,526		11,505
Canada Branch Division	1,615		791		5,179		1,824
All Other	—		—		—		—
Total	$	20,042	$	18,624	$	60,359	$	54,211

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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