Public E&S Companies Posted 4.9% First Quarter Gain

Seven publicly traded equipment and supplies companies reported blended sales rose 4.9% in the first quarter 2012 versus the same quarter in ’11. It was the eighth consecutive quarter of combined revenue gains for the seven, which include five equipment-oriented and two supplies-oriented companies. The increase was an improvement over a moderate 3.1% gain in the fourth quarter ’11. That was the slowest gain since the public companies emerged from the recession in the second quarter of ’10. Combined sales for all of ’11 were up 8.3% versus ’10.

The overall number was unexpectedly boosted by a 10.3% first- quarter sales increase for Libbey Foodservice. With sales rising 4.4% at Carlisle Foodservice, following a nearly 5% decline in the fourth quarter, combined supplies sales for the two companies were up 7.9%.

Combined sales of the five equipment-oriented companies rose 4.5%, a slight improvement over the 4% gain seen in the fourth quarter last year. Rational Americas posted a 33.2% increase in first-quarter sales versus first quarter last year, but since the Americas division of the German-based company is by far the smallest component of the five equipment companies, it had little impact on the overall equipment numbers. Middleby Foodservice’s organic sales rose 6% in the quarter; the company said revenues increased 16% including the effect of acquisitions. Standex Foodservice saw sales rise 5.5%, Manitowoc Foodservice reported a 3.8% gain and ITW’s Food Equipment Group Worldwide was essentially flat, posting a 0.1% increase versus the first quarter ’11.

The public companies combined first quarter increases ran slightly ahead of those noted by manufacturers’ reps surveyed for the MAFSI Business Barometer (see related article.) However, the reps said equipment sales rose 5% in quarter, compared with the 4.5% increase from the five equipment-oriented companies.

(Note: In this report and going forward, we report ITW FEG’s Worldwide numbers instead of estimating Hobart Foodservice’s North American sales. While about a third of the FEG Worldwide number is service, ITW generally reports a hard number for the division as a whole. The total FEG number also brings in Vulcan, Traulsen, Gaylord and other FEG brands. And with about a third of FEG Worldwide revenues outside of North America, it seems a better comparison with the other companies in the group, most of which include export sales. The percentage changes for the first quarter above, including those for combined sales, make comparisons with total ITW FEG Worldwide sales for the first quarter ’11.)