Heating, Air-conditioning & Refrigeration Distributors International (HARDI) released its monthly TRENDS report, showing average sales for HARDI distributor members declined by 1.5% in August 2017.
The average annualized growth for the 12 months through August 2017 was 6.7%.
“I think the slight decline for the month is actually very good performance because August 2017 is being compared to the extraordinary August 2016 when average distributor sales were up by 19.5%,” HARDI Market Research & Benchmarking Analyst Brian Loftus said. “The population-weighted cooling-degree days were 40% above normal in August of 2016. Even though August 2017 had 7% more cooling-degree days than normal, it was 26% fewer than the prior year’s heat wave.”
“One would think this off month likely was driven by Hurricane Harvey injecting some noise into the equation,” HARDI Senior Economist Connor Lokar added, “but the results do not bear that out. Sales in the Southwest actually rose 0.5%, on average for the month. While 0.5% growth would not normally be impressive, it outpaces the total average decline for the month.”
ITR, which prepares economic forecasts for HARDI, still is assessing the post Harvey and Irma terrain. “Katrina and Sandy showed us that the severity of a localized storm is not enough to shift a major economic trend such as GDP or U.S. Total Industrial Production. Accordingly, there is no need to change those forecasts for the near-term,” Lokar stated.
The days sales outstanding, a measure of how quickly customers pay their bills, is now near 42 days. “July and August are the seasonal low points for the annual DSO cycle,” Loftus said. “This report matches the August 2015 and 2016 reports, so no sign of economic fatigue or stress.”