About David Cherechinsky
David Cherechinsky, President and CEO of DistributionNOW, said in a September 2023 interview that the company has shifted from being a "one-stop shop" to focusing on areas where it is strongest and where customers see value, such as supply chain management. He stated that the company operates 170 locations, with about 60 outside the United States, and that its size allows it to provide products even during supply chain disruptions. Cherechinsky described the company as being at "peak earnings" in its nine-year public history and noted it had made about four acquisitions in the prior five months and initiated a share buyback program that was about halfway complete.
Cherechinsky characterized the energy transition as an "energy evolution" that will take time, and said DistributionNOW is focused on providing lower-emission products to existing oil and gas customers, who he described as likely major investors in carbon capture and direct air capture. He mentioned the company had recently acquired a firm focused on emission reduction. Cherechinsky also said the U.S. and Canadian markets are stabilizing, while international markets are beginning to grow due to energy security concerns in Europe, and that the company is adding sales staff and working with customers to pursue growth outside its core end-market focus.
Source: AI-verified profile updated from David Cherechinsky's recent appearances.
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Transcript (12 segments)
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Judy Shaw0:00
I'm Judy Shaw for NYSC Floor Talk. Joining me today is David Cherechinsky. He is President and CEO at Distribution Now. David, it's wonderful to have you here. Thanks for joining.
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David Cherechinsky0:08
Good morning, Judy. Thanks for having me. I'm very excited. My pleasure.
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Judy Shaw0:11
So now, David, tell me what value does DNOW offer to its customers? What markets and geographies are served, and how are you different from others in the space?
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David Cherechinsky0:20
Our main value we provide to our customers, we focus on our strengths. We're a distribution company that's been in business for 160 years. We used to be a one-stop shop providing all things to our customers, and the customers didn't see the value in everything we provided because we weren't great at everything. So we focused on where the customer sees value. We manage a supply chain, working with our key manufacturers, making large commitments to key manufacturers, and providing the best products, the best price, and availability to our customers to manage the supply chain very well. Our ability to service our customers comes from being the biggest supplier in our space, so we can provide products even when there are supply chain issues, and it helps them manage their businesses. We operate in 170 locations, about 60 of those outside the United States, so we manage a large network to satisfy customer requirements around the world.
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Judy Shaw1:20
So David, the world will continue to need access to an abundant, low-cost source of energy. Tell me, how is DNOW participating in the energy transition?
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David Cherechinsky1:30
That's a good question. We see energy demand only growing over time. Oil and gas energy demand may peak at some time in the future, so we're focused on pursuing an energy transition, but we're in a dominant position in oil and gas distribution. Our big focus now is embracing the energy evolution. Some call it the energy transition; we call it energy evolution because it's going to take time to make that transition. We're focused on providing lower emission products to our current customers. Our current customers are going to be the big investors in the future in terms of carbon capture, direct air capture, making that transition. The current oil and gas producer is going to be making that switch, so we're holding hands with our customers, working with manufacturers to provide the interim solutions. We recently just bought a company that's focused on emission reduction, and I'll talk about that in a bit. So, really focusing on the pivot towards the future is a big part of our push right now.
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Judy Shaw2:35
And how are you creating value for your shareholders?
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David Cherechinsky2:39
Our main thing, as I said earlier, we're focused on the intersection of our strengths and where the customer sees value. We don't focus on low margin, low value commodity products. We try to find the sweet spot where we're strong from our 160 year history and where the customer sees value. So we've significantly improved earnings. We just initiated a buyback program which we're about halfway through, and we're acquisitive. We've made about four acquisitions in the last five months. We're focused on really growing our business outside of oil and gas, really leveraging our supply chain competencies. If you think about it, you could move many products through an efficient supply chain. So that's where we see value: improving profitability. We're at peak earnings in our nine-year public company history. We're very acquisitive. We initiated the share buyback program, and we're focused on the energy transition as a main focus for continued growth into the future.
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Judy Shaw3:43
All right, and finally David, as you look ahead, tell me what are you focused on?
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David Cherechinsky3:47
The main things right now: we're starting to see the international market take off. The U.S. and Canadian markets are kind of stabilizing in the oil and gas space. International is beginning to grow due to energy security issues in Europe and outside of North America. And then energy transition is the major push. So we're adding sales people, we're working closely with our customers' procurement departments and their engineers to really embrace the future and make a pivot towards significantly improved growth outside of our core end market focus.
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Judy Shaw4:24
All right, well David, wonderful to have you here. Thanks for joining me on Floor Talk today.
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David Cherechinsky4:26
Yeah, thank you, Judy. Appreciate it.
