May 4, 2016, 10:21am CDT
Net sales declined to $286.5 million from $311.8 million the year before, with a modest increase in residential product sales being offset by a sharp drop in commercial and industrial product sales. Generac said there was a “significant decline in shipments of mobile products into oil and gas and general rental markets.”
“Shipments of residential products came in modestly ahead of our expectations benefiting from improved activations over the prior year,” said Aaron Jagdfeld, president and CEO. “This performance, along with better-than-expected shipments from recent acquisitions, helped to largely offset weaker sales of mobile products caused by low energy prices. As a result of the ongoing and significant downturn in capital spending within the oil and gas industry, we initiated a number of meaningful but necessary actions during the first quarter to better align our current cost structure with customer demand.”
Generac said it is maintaining its guidance for the full year, with expectations of net sales growth of 10 to 12 percent. Excluding sales from newly acquired businesses and the impact of currency translation, sales are expected to be down 5 to 7 percent largely because of the weakness in mobile product shipments to the oil and gas market and the rental market.
David Schuyler is Digital Producer overseeing website content and also serves as a reporter covering the arts and nonprofit organizations for the Milwaukee Business Journal