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Breaking news in Wholesale Distribution
The second quarter Baird Industrial Distribution Survey indicates that average second quarter year over year revenues were slightly worse than the first quarter, with the third quarter forecast slightly better than current quarter trends. Encouragingly, pricing and gross margins appear to be holding relatively steady while inventory levels continue to decline with no re-stock expected in the near-term.
The bottoming process appears to be underway in most industries," said David Manthey, CFA, Baird's senior research analyst who leads the firm's Industrial Distribution sector research. "With conditions stabilizing and inventories at very low levels throughout most supply chains, industrial distributors should continue to see improvement into 2009."
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United Stationers Inc., Deerfield, IL, a North American wholesale distributor of business products, today sales for the second quarter 2009 were $1.16 billion, down 7.4% from the prior year same period. Profit decreased 1.4% to $21.5 million.
Weak macro-economic conditions contributed to revenue declines in furniture, industrial, technology and traditional office supplies. Despite these conditions, the janitorial/breakroom category experienced sales growth.
"United's results reflected our associates' excellent efforts to control what we can in the face of difficult market conditions," said Richard W. Gochnauer, president and chief executive officer. "While employment and manufacturing trends continued to weaken in the quarter, the rate of change in our sales improved sequentially ...
Canton, OH-based The Timken Company has agreed to sell its Needle Roller Bearings business - which serves customers mostly in the automotive OEM sector - to Japan's JTEKT Corp. JTEKT will pay $300 million in cash.
"This transaction is a major step forward in our strategy to transform our portfolio to focus on industrial sectors with strong aftermarkets," said James W. Griffith, Timken president and CEO. "It positions us to concentrate our resources on areas where we can realize mutual value with our customers."
The Needle Roller Bearings business was part of the broader Torrington acquisition Timken made in 2003. It had sales of $621 million in 2008 and has 3,400 employees. The business, with 12 manufacturing facilities and three engineering technology centers, manufactures highly ...
New orders for manufactured durable goods in June decreased $4.1 billion or 2.5% to $158.6 billion, according to the U.S. Census Bureau. This decrease followed two consecutive monthly increases including a 1.3% May increase. Excluding transportation, new orders increased 1.1%. Excluding defense, new orders decreased 0.7%.
Shipments of manufactured durable goods in June, down eleven consecutive months, decreased $0.3 billion or 0.2% to $168.3 billion. This was the longest streak of consecutive monthly decreases since the series was first published on a NAICS basis in 1992 and followed a 2.6% May decrease.
Unfilled orders for manufactured durable goods in June, down nine consecutive months, decreased $6.6 billion or 0.9% to $740.1 billion. This followed a 0.3% May decrease. ...
Park-Ohio Holdings Corp., Cleveland, OH, announced sales for the second quarter were $163.4 million, down 43% from second quarter 2008. Profit declined 42.1% to $3.3 million.
Year-to-date, sales were $344.7 million, down 38% from the same period of 2008. The company recorded a net loss for the first six months of 2009 of $2.2 million, compared to profit of $9.2 million in the same period of 2008.
Park-Ohio is a provider of supply management services and a manufacturer of highly engineered products. ...
Arrow Electronics, Inc., Melville, NY, reported second-quarter 2009 sales were $3.39 billion, down 22% year over year. Profit declined 78% to $21.1 million.
Global enterprise computing solutions sales of $1.12 billion decreased 19% year over year. Global components sales decreased 23% to $2.27 billion
"While pleased with our second-quarter performance, we also realize that the cost savings we have generated to date have not been enough to offset both the sales declines and margin pressure we have experienced during this downturn," said Paul J. Reilly, executive vice president and CFO. "Given the market realities we are faced with, we have an additional $100 million in annual cost reductions that are expected to be implemented in the second half of 2009, primarily in our European ...
Fuel, freight, and energy charges are some of the many items distributors are discovering some customers are willing to pay for. The key word is "some."
Brent Grover, author of the new book, "Strategic Pricing for Distributors: Tools and Rules for Building Higher Margins," recently spoke with MDM about his new book for the latest issue, and he says that the key for any add-on to an invoice is to do it in customer segments that are least likely to resist those charges. "It's not a matter of being tough and putting in an across-the-board change," he says. Distributors should not want to lose a customer due to an add-on charge.
"The ability to recover outbound freight charges is a big profit lever for distributors," ...
Praxair, Inc., Danbury, CT, reported sales for the second quarter 2009 were $2.13 billion, down 26% from the prior year same period. Profit declined 14.3% to $299 million.
For the first six months of 2009, sales were $4.26 billion, down 23.1% from the first half of 2008. Profit decreased 10.2% to $589 million.
"Challenging economic conditions persisted globally in the quarter, resulting in overall volumes on par with the first quarter," CEO Steve Angel said. "We have begun to see pockets of sequential improvement in Asia and South America, where economic activity appears to be reacting positively to fiscal and monetary stimulus programs. In Europe and North America, the overall industrial environment remains very weak, although volumes appear to have stabilized."
In North ...
Sealed Air Corp., Elmwood Park, NJ, reported second quarter 2009 sales of $1.03 billion, down 20% from the prior year period. Profit declined 3% to $60.5 million.
Year to date, sales were $2.01 billion, down 18% from second quarter 2008. Profit decreased 4% to $118.6 million.
Food Packaging segment second quarter sales decreased 14% to $449 million. Operating profit was $62 million in the quarter, about 10% higher than the prior.
Food Solutions' second quarter sales decreased 15% to $220 million, primarily a result of lower unit volumes in Europe due to reduced meat consumption attributable to economic conditions. Operating profit was $22 million in the quarter, 22% higher than prior year.
Second quarter sales in the Protective Packaging segment decreased 28% to $282 ...
The Timken Company, Canton, OH, reported sales of $828.9 million for the second quarter of 2009, a decrease of 46% over the same period a year ago. The manufacturer of power transmission products recorded a loss of $64.5 million for the term, compared with profit of $88.9 million a year ago.
"The combination of a slow economy and inventory reduction throughout the supply chains we serve continues to curb demand for our products. We're now seeing evidence that our customers' inventory destocking activities may go longer and deeper than we expected," said James W. Griffith, president and CEO. "We have decreased manufacturing output in response to lower demand and are on track in our efforts to right-size the company."
For the first half of 2009, sales were $1.79 billion, down 40% ...
