On April 20, swimming pool equipment and outdoor living products distributor Pool Corporation reported 2023 first-quarter net sales of $1.2 billion, a 15% decrease from 2022.
Pool Corp’s 1Q decline follows year-over-year sales growth of 17% in 4Q 2022. The decline is also a stark contrast to the company’s 1Q performances in recent years: Pool Corp had 33% net sales growth in 1Q 2022 and 57% growth in 1Q 2021.
While Pool Corp’s sales in the south — including Texas and Florida, two of the company’s largest markets — produced results in line with 2022 sales, Pool Corp’s sales in the west were hampered by poor weather during 1Q 2023. Arizona and California, also both critical markets for the distributor, experienced seasonally unusual wet and cold weather, resulting in sales falling 21% year-over-year in those markets.
“In the first quarter of 2023, differing weather conditions contributed to variability in our results across geographies,” Pool Corp President and CEO Peter Arvan said in the financial report. “Our southern markets experienced more typical weather during the quarter and generated encouraging results. However, higher precipitation and cooler temperatures suppressed results in our western markets, hampering new pool construction activities and sales of maintenance-related products. These conditions continued into late March where we saw a considerable impact on our biggest sales month of the quarter.”
Gross profit decreased 17% year-over-year in 1Q while gross margin fell 110 basis points.
“Headwinds from economic conditions, including tightening financial markets and higher interest rates, further weighed on new pool construction,” Arvan continued. “Going forward, we remain committed to our strategic goals of organic growth of our sales center network and key working capital investments that provide our customers with convenient access to our broad assortment of products and tools to help them grow.”