The average sales performance by Heating, Air-conditioning & Refrigeration Distributors International members increased 18% during September, HARDI said Nov. 1 in its monthly TRENDS report.

The average annual sales growth for the 12 months through September 2022 is 23.5%, HARDI said.

“That annual growth rate chart is looking tired,” said HARDI Market Research & Benchmarking Analyst Brian Loftus. “The annual growth has been flat-to-down since the beginning of the year. It has been supported by the pass-through of aggressive price increases and the industry PPI is now losing altitude.”

The Days Sales Outstanding, a measure of how quickly customers pay their bills, is 42 days as of September 2022, HARDI said. The September DSO pre-COVID was 46.5 days and the year-to-year DSO has increased for three straight months, according to HARDI.

“The last time that happened was late 2019 when the economy was slowing,” Loftus said.

Last month, HARDI distributors reported that revenue increased 24.8% in August. September is the last month of “cooling season,” and more than 40% of HARDI distributor annual sales  occur from May to August.

“Cooling season was mixed this year,” Loftus said. “A strong season requires warm weather at the beginning, and we were off to a good start during April and May. Then Cooling Degree Days were below normal and the prior year during June, and then generally soft during July, August, and September. That means a modest year-to-year weather comp during 2023 cooling season when we expect the macro conditions to be less accommodating.”