The 2020 Mid-Year Economic Update_long

Day: July 9, 2008

PT/MC Sales by Distributors Fall 7.2% in May

U.S. distributors'overall sales of Power Transmission/Motion Control products declined 7.2% in May 2008 compared to April 2008, according to the latest month-end trend data from the Power Transmission Distributors Association. When matched up against sales in the same month last year, sales in May 2008 were up 1%.
 
Accounts receivable collection days rose 7.8% since April 2008. The confidence index of U.S. distributors dropped to 5.6 in May 2008 from 5.8 in April 2008 (on a 10-point scale) the first decline since February 2007.
 
Canadian distributors also reported a decrease in PT/MC sales, dropping 5.4% in May 2008. Sales over the same period last year were down 6.8%. Accounts receivable collection days rose 2.5% compared to April 2008. In May 2008, the ...

Survey: Respondents Outside of Bldg Materials/Transportation Optimistic

Companies reporting their business conditions as thriving and growing"declined by nearly 10% in the past year, according to the third annual RSM McGladrey Manufacturing and Wholesale Distribution National Survey. However, business remains good for more than a third of survey participants within the following industry segments: food and allied products, medical devices, industrial equipment, metal fabrication and electronics.

More than 960 industry executives -representing 911 companies -responded to questions on current business conditions, growth strategies, innovation, cost management, technology initiatives, operations and ...

Textron’s Greenlee Unit Acquires Utilux

Textron Inc.'s Greenlee business unit, Rockford, IL, has acquired UK-based Utilux, a manufacturer of electrical connectors and cable assemblies for electrical distributors and other European industrial segments. With this acquisition, Greenlee improves product offerings and capacity at its Klauke division, based in Remscheid, Germany.
 
With revenues of about $28 million in fiscal year 2007, Utilux has about 220 employees and will continue to operate out of its Slovakian and UK locations.
 
Greenlee provides professional tools for use in the electrical, plumbing, communications, and construction and maintenance markets worldwide. Textron Inc. is a $13.2 billion diversified manufacturing company operating in 34 countries with 44,000 employees. ...

Georges Enterprises Buys Food Distributor Harrison Co.

Georges Enterprises, Elmwood, LA, has purchased Bossier City, LA-based food distributor Harrison Company. Harrison will continue to operate as a separate entity under the name Harrison SR.
 
As part of Georges Enterprises, Harrison will join New Orleans-based Imperial Trading Company to expand the company's food distribution reach to nine states from its current five. The acquisition will also provide an inland site to alleviate disruptions like those that occurred after Hurricane Katrina hit New Orleans.
 
Harrison president Hal Martin will continue in that role.
 
Georges CEO John Georges says they will add 50 to100 new jobs in Bossier City where Harrison currently employs 150.
 
Georges expects the partnership to earn $1 billion by 2010. ...

Zep Reports 3Q Sales Down Slightly

Atlanta-based Zep Inc., a producer of cleaning and maintenance products, reported sales of $145.2 million for the third quarter ended May 31, 2008, down slightly from $145.4 million in the previous year. Profit was $0.2 million, down 94% from third quarter 2007.
 
Excluding charges for restructuring and special items, Zep had an adjusted profit of $6 million, down 4.8% from the adjusted profit the previous year.
 
The decline was attributed to higher raw material costs, increased stand-alone public company expenses and investments related to ongoing strategic initiatives.
 
For the nine months ended May 31, 2008, profit was $8.4 million, up 21.2% over the prior year. Zep reported sales of $421.9 million in the first nine months of fiscal year 2008, an ...

Clean Air for Olympics: Production Shutdowns Near Beijing

The Chinese government is taking some drastic measures to clean up its polluted air before the Olympic Games in August. Those measures include ordering industrial plants, like steelmaker Shougang and automaker Hyundai, to curtail their production or shut down for two months beginning on July 20, according to BusinessWeek.
 
Bryan Larkin, marketing director at consulting firm GXS in Gaithersburg, MD, told Businessweek that a fair number of companies worldwide were caught off guard by the new restrictions, and it's too late to do anything to head off supply shortages that could result. We will see a different mix of goods or even empty shelves"as far away from China as the U.S. and Europe because of this, he said.
 
Companies that did have advance warning have been ...