Another Year Of Slow Growth For Public E&S Companies

The big publicly reporting foodservice equipment and supplies companies grew combined sales 4.9% in 2017, aided by acquisitions. But organic sales went negative in the fourth quarter and rose only 1.5% for all 2017. The numbers come from FER Research Associate John Muldowney, also principal at Clarity M&A, who compiled results from eight publicly reporting E&S companies for the fourth quarter and full year 2017.

On the nominal side, which include the addition of volume from acquisitions, the six equipment-oriented companies posted a 3.4% gain and the two supplies-oriented companies were up 27.4%, nearly all as a result of Carlisle Foodservice’s addition of San Jamar in 2016. The combined 4.9% nominal gain for all eight was well ahead of the 3% FER estimates the market grew last year.

But the “organic” numbers tell a very different story. The six equipment companies saw sales grow a mere 0.1%, while the supplies companies grew 13.2%. Combined, the eight companies were up only 1.5% on an organic basis for the full year.

While the fourth quarter 2017 nominal growth comparison to fourth quarter 2016 was 4.8% including acquisitions, organic 4Q results slowed from 3Q growth to a 1.2% decline.

On an organic basis, four of the eight companies reported sales declines in 2017. Welbilt was off 0.8%, Middleby Foodservice organic sales fell 1.8%, ITW FEG North America’s sales were down an estimated 2.1%, and Libbey Foodservice posted a 0.6% decline.

On the positive side, shaking off the effects of slowdowns among its retail chain customers in 2015 and 2016, Standex organic and nominal sales rose 7.8% for all 2017. Rational the Americas’ nominal and organic sales were 26% higher as it continued to see strong demand for combi ovens and benefit from a sales restructuring, and Carlisle posted a strong 27.6% organic gain for the year, even after discounting for the effect of San Jamar. Unified Brands sales were essentially flat, with an estimated 0.1% increase for the year.

The public company results are very much in line with a slow-growth pattern the large E&S companies have seen for three years. Slow organic growth or slight negative sales were exhibited by both chain-oriented and spec market-oriented companies in 2017.

RELATED CONTENT

Mici 1200x800 1

Mici Handcrafted Italian Signs First Franchise Deal

The brand announced it signed its first franchise deal with Black Bear Diner and Smashburger franchisees Lucas Farnham and David Doty to bring 30 Mici locations to the Phoenix market.

CaliBurger 1200x800 1

New CaliBurger Location Goes Heavy on the Tech

The latest CaliBurger restaurant is coming with a cook already in the kitchen.

- Advertisement -

- Advertisement -

- Advertisement -

TRENDING NOW

- Advertisement -

- Advertisement -