Waukesha-based Generac Holdings Inc. increased revenue by 20.3 percent and more than doubled its earnings during the first quarter, prompting executives to increase guidance for the full year.
The company now expects its core sales to increase by 5 to 6 percent for the year, up from 2 to 3 percent to start the year. The increase would come on top of an 11 percent increase in organic sales last year. Generac also faces a 4 percent growth headwind in the second half of the year from increased portable generator sales prompted by a series of hurricanes in the fall.
Aaron Jagdfeld, Generac president and chief executive officer, said inventories of portable generators are low in sales channels and company warehouses and Generac has been working to catch up since the hurricanes.
“The amount of portable generators we’ve put in the market over the last several quarters, it’s amazing,” Jagdfeld said. “We’re running flat out in our facility here in Jefferson, Wisconsin. We’ve got our supply chain ramped up really hard, but every time we think we’re getting ahead of it we get one successive storm after another in the northeast in the month of March.”
“We’re scrambling to get stock and we’re building as much as we can,” he added.
Jagdfeld said Generac’s ability to meet demand last year is helping the company gain market share as customers consider their orders for this year.
“Our performance last year really led us to the point of winning some additional business this year,” he said.
The portable generator market is just one area the company is optimistic about. Jagdfeld said home standby generators have seen growth in in-home consultations and end-user activations while commercial and industrial products have experienced strong growth driven by an ongoing replacement cycle.
All of the positive data points led the company to add $50 million to its sales guidance for the year.
The first quarter alone included a $67.1 million increase in revenue to $397.6 million. Core sales, which excludes the impact of foreign currency, increased approximately 17 percent.
Net income for the quarter increased from $12.2 million or 20 cents per share, to $33.6 million, or 42 cents per share.