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North American HVACR average distributor sales for December closed out 2010 in line with forecast sales, but fell short of most manufacturer and analyst projections going into the year, according to the Monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report from Heating, Airconditioning and Refrigeration Distributors International (HARDI). Average growth for the month was 17 percent versus December 2009, driven by the impending expiration of the full $1,500 residential tax credits.
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The running 12-month sales improved for the fifth consecutive month meeting the top end of HARDI's 2010 growth projections at just over 10 percent. Every HARDI region saw improved sales in 2010, with four U.S. regions and Canada finishing the year up double digits.
For the second consecutive month, Average Days Sales Outstanding continued to decline falling much more in-line with distribution averages. Average distributor sales per employee inched up again after a modest increase last month.
"As expected, the pending reduction of the $1,500 tax credits effective January 1, pulled early 2011 demand into December giving our members a great close to what was generally an underperforming 2010," said Talbot H. Gee, HARDI executive vice president and COO. "December's distributor sales mix of cooling equipment was nearly 50 percent 14 SEER and higher which will most certainly not be the case next month or likely any of 2011. The question moving forward isn't whether but how much high-efficiency sales will drop if we're unable to fully reinstate the 25C tax credits or grow other efficiency incentives."