ASA Members Report Profits and Inventories Up in October
For the sixth consecutive month, members of the American Supply Association have reported growth, showing an 8.1% improvement in per-workday revenues during the month of October 2010 as compared to the same month in 2009, and down only 8.0% against 2008. The plumbing, heating, cooling and PVF distributors are now ahead of 2009 year-to-date by 1.1% on a per-day basis.
As there was one less workday in October 2010 than in 2009, and two less than 2008, the raw monthly revenues for the industry members were up 3.3% for the month vs. 2009 and down 17.1% compared to two years ago.
Almost half of all distributors this month are reporting reduced margins in 2010 as compared to 2009, with only about a third report improving margins. There is no longer a clear distinction in margin trend based upon the size of distributors.
After 20 consecutive months of declining inventories, ASA members put an additional 1.4% of inventory onto the shelves as compared to 2009, but still have reduced by 11.9% as compared to 2008. Inventory turns continue to be reduced as the inventory growth exceeds the revenue increases. In accounts receivable, days sales outstanding have decreased by 0.5 days verses 2009. For the first time, the trend of reduced head count has stopped after two continuous years. There is a similar number of distributors reporting an increase in employment as those that are reporting reduced employment against 2009.
Read the full report here.