North American HVACR average distributor sales for February 2012 were up 9.6%, according to the Heating, Air-Conditioning and Refrigeration Distributors International TRENDS Report.
HARDI's Monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report showed February growth in all seven U.S. regions, with three regions showing double-digit growth. Canadian distributors had a strong February, although not enough to fully counteract a January decline and turn its annual growth rate positive. U.S. distributor sales were up 9.7% in February.
"Inventories are still elevated," said HARDI economist, Andrew Duguay. "Just over two-thirds of distributors reported higher inventories than last year. This is likely causing the sharp contrast with HVACR New Orders from Census Bureau data and the less-than-stellar shipment numbers recently reported by AHRI."
Days Sales Outstanding, which measures how quickly customers pay their bills, were up for the sixth time in seven months, increasing to almost 52 days.
Distributor productivity, reflected by sales per employee, backtracked for the seventh consecutive month - it was down 6% from January 2012 and down nearly 40% from its peak in July 2011.
"Our economists' bullish forecasts for 2012 are off to a great start thus far and serving as another reminder that shipment data is not the best leading indicator for industry sales," said HARDI Executive Vice President and COO Talbot Gee. "Discussions with distributors across the U.S. are carrying a consistent theme of aggressive inventory positions so that no sales are lost as the market continues to strengthen this year."
Gee added, "Interestingly, distributors' unitary sales - ducted and ductless units alike - are trending almost exactly opposite of AHRI shipments and kicking off 2012 with impressive growth versus a disappointing Q1 2011."
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