Generac Net Sales Leap 25.3 Percent in Second Quarter
Generator manufacturer Generac posted $494.9 million in net sales in the second quarter compared to $394.9 million in the second quarter of 2017, a 25.3-percent increase, including $4 million of contribution from the acquisition of Selmec, which closed June 1. Core sales growth, excluding the favorable impact of acquisitions and foreign currency, was about 23 percent.
Gross profit margin improved 190 basis points to 35.6 percent compared to 33.7 percent in the second quarter of 2017.
Net income attributable to the company during the second quarter was $53.3 million, or $0.82 per share, compared to $25.3 million, or $0.41 per share, for the same period a year ago.
“Our second quarter results further demonstrate the tremendous earnings power of Generac as solid execution across our entire business helped drive a 300-basis point expansion in EBITDA margins over the prior year,” said Aaron Jagfeld, president and CEO. “We continue to see robust demand across all of our end markets and geographies, with particular strength coming from residential products as power outages over the last 12 months have been well above the long-term average. Global interest for our C&I mobile and stationary products have also been strong primarily driven by an increase in telecom, healthcare and other large projects, as well as the continued investment in fleet equipment by our rental account customers. Lastly, on June 1st, we closed on the acquisition of Selmec, further expanding our presence in the important Latin American backup power market.”
Domestic segment sales increased 24.8 percent to $381 million as compared to $305.4 million in the prior-year quarter. The current year quarter experienced strong growth in shipments of home standby and portable generators and also benefitted from robust commercial and industrial shipments driven by mobile products fleet replacement and strength in stationary generators through national accounts. Increased service part sales also contributed to the year-over-year growth.
International segment sales jumped 27.3 percent to $113.9 million compared to $89.5 million in the year-ago quarter, including $4 million from the Selmec acquisition. Core sales growth was approximately 16 percent, primarily from broad-based growth of C&I products in Europe, Asia and Latin America.
About the Author
Michael Roth
Editor
Michael Roth has covered the equipment rental industry full time for RER since 1989 and has served as the magazine’s editor in chief since 1994. He has nearly 30 years experience as a professional journalist. Roth has visited hundreds of rental centers and industry manufacturers, written hundreds of feature stories for RER and thousands of news stories for the magazine and its electronic newsletter RER Reports. Roth has interviewed leading executives for most of the industry’s largest rental companies and manufacturers as well as hundreds of smaller independent companies. He has visited with and reported on rental companies and manufacturers in Europe, Central America and Asia as well as Mexico, Canada and the United States. Roth was co-founder of RER Reports, the industry’s first weekly newsletter, which began as a fax newsletter in 1996, and later became an online newsletter. Roth has spoken at conventions sponsored by the American Rental Association, Associated Equipment Distributors, California Rental Association and other industry events and has spoken before industry groups in several countries. He lives and works in Los Angeles when he’s not traveling to cover industry events.