While the entire industry saw improvement in the first quarter thanks to easing headwinds, building materials & construction distributors again reigned as the top-performing sector, with most companies posting double-digit sales growth to start 2016.
Earnings reports for first quarter (or fiscal second or third quarter) have been mostly positive for building materials & construction distributors, with many companies benefiting from recent acquisitions. Here's a sampling of sales increases from the first week of May.
- BMC Stock Sales Up 148.4% in 1Q
- Beacon Roofing Sales Up 99.3% in 2Q
- Builders FirstSource Pro Forma Sales Up 9.1% in 3Q
- Continental Building Products Sales Up 21% in 1Q
- Huttig Building Products Sales Up 7.7% in 1Q
According to the most recent MDM-Baird Distribution Survey, the building products and facilities maintenance category averaged 4 percent revenue growth during the first quarter, far ahead of the industry average of -0.1 percent – the second consecutive quarter of negative growth.
Among the 19 product sectors, respondents in the building products and facilities maintenance category performed well in the first quarter. Lumber and building materials posted the strongest revenue growth at 5 percent, followed by plumbing (4.5 percent), pool & spa (4.3 percent) and HVAC (3.9 percent).
Other positive reports for the sector have emerged in the past week or so. March construction spending was 8 percent above the March 2015 estimate, and privately owned housing starts in March were 14.2 percent above the March 2015 rate.
The good news should continue for the sector moving forward. Growth for building materials & construction distributors is forecasted at 4.5 percent revenue growth in the second quarter and 4.4 percent in 2016.
