Hearth & Home

2016 July Business Climate


July Sales

In early August Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare July 2016 sales to July 2015. The accompanying charts and selected comments are from the 212 useable returns.


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Weather Report

Consumer Confidence

Stock Watch


RETAILER SALES – U.S. AND CANADA
July 2016 vs. July 2015

In July, 38 percent of Barbecue retailers, and 37 percent of Hearth retailers, said their sales were up over the prior year, while only 14 percent of Patio retailers could say the same thing.


13 MONTH YEAR-OVER-YEAR RETAILER SALES
July 2015 Through July 2016

Leading the way in July, sales of Barbecues were up nine percent, while sales of Spas and Patio were up four percent and three percent, respectively; sales of Hearth products were down three percent.


Retailer Comments

Northeast

Maine: (Hearth) “We are in need of higher fuel oil prices this fall. Need a stronger retail economy.”

Maine: (Hearth) “Seems it’s part of the economy in this area. We recently lost Sears and Kmart.”

New Jersey: (Hearth) “Bring on the COLD weather. We’re ready!!”

New Jersey: (Hearth, Patio, BBQ) “Growth continues even though it’s hot as hell. Always thankful for our customers and company team!”

New York: (BBQ, Spas) “Steady traffic and July 4 promos helped us double our hot tub sales for July.”

New York: (Hearth, BBQ) “Those that walk in the door seem to be buying, but traffic is slow.”

New York: (Hearth) “Very warm weather in the Northeast, and low oil prices coupled with last year’s warm winter have our customers in a fog. I hope they don’t all call us in October as we will then have back-orders.”

Pennsylvania: (Hearth, Patio, BBQ) “Lots of good indicators that the season may have a good start.”

Pennsylvania: (Hearth, Patio, BBQ) “July was slower for service and chimney cleaning, expected with the past warmer winter. New construction and remodeling is a little stronger this summer. Gas is strong and pellet stove sales are better than expected, mostly higher-priced models. Wood and coal sales are non-existent. Still believe we will have a strong third quarter.”


Weather Report

For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.

In the month of July, the East Coast going from Connecticut down to Florida and across to Arizona baked under a very warm sun; Florida and New Mexico didn’t bake, they sizzled while setting records.

For the three-month period May-July, only Indiana and West Virginia stayed at Near Normal temperatures, while the rest of the country experienced Above Normal or Much Above Normal readings.

In July, Georgia, Florida, New Mexico and Wyoming posted Much Below Normal precipitation levels, while five states – Kentucky, Illinois, Missouri, Minnesota and North Dakota – were at Much Above Normal readings.

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South

Arkansas: (Hearth) “Very slow retail month due to record rainfall and heat, plus election jitters. YTD sales are depressing and winter is a long ways away.”

Louisiana: (Hearth) “We have installed more outdoor fireplaces and high-end fireplaces this month than we have for the first part of the year.”

North Carolina: (Hearth) “Let’s get this election cycle out of the way so consumers can get back to doing projects.”

Oklahoma: (Hearth) “Hot…Hot…Hot. Come on WINTER.”

Tennessee: (Hearth, BBQ) “HOT, ugly, sluggish month!”

Texas: (Hearth, BBQ) “Ceramic sales are off, I think I’ve seen their peak. Dealing with more Internet stress than ever! People shopping on their phones in our store.”

Virginia: (Hearth, BBQ) “Lots of remodeling and renovating with fireplaces.”

Midwest

Illinois: (Hearth) “Business continues to be very slow. We hope it will get better if we have a major change in the executive branch! Last year and previous four years the same. No building going on here to speak of. Factories are closing. Net sales for all categories is a negative 22 percent. Hearth is up because last July was negative.”

Iowa: (Hearth, BBQ) “I don’t see a down trend whatsoever. Our revenues were down simply because of cash. We use a cash basis.”

Michigan: (Patio, BBQ) “July still had many special orders despite customers, often times, not receiving product until the end of summer.”

Missouri: (Hearth, BBQ) “Soft sales in hearth products. Hot and wet weather continues. Barbecue sales stronger than expected.”

Missouri: (Hearth, BBQ) “Early July was extremely hot and construction slowed during that time for safety reasons. That being said, the clients were still looking at options, and by the end of the month the showroom was busy daily as well as my technicians and builders. The beginning of the month looked bleak, but by the last day we found a way to break even for the month. August is already looking great and my hearth season seems to have already started by the number of walk-ins and calls that I’m getting.”

Wisconsin: (Hearth, BBQ) “We’re living in an area that has been significantly affected by natural disasters. We lost a significant amount of time having to deal with the effects of the disasters personally, individually and with the business. We have the work, but were unable to get to some of the work areas in a reasonable length of time. We’re juggling to pull future book jobs forward along with the necessary support merchandise for our work.”

Wisconsin: (Hearth, Patio, BBQ) “Strong year but July faltered.”


Consumer Confidence

The Consumer Confidence Index, which had increased in June, was relatively unchanged in July. The Index now stands at 97.3 (1985=100), compared to 97.4 in June.

“Consumer confidence held steady in July, after improving in June,” said Lynn Franco, director of Economic Indicators at The Conference Board. “Consumers were slightly more positive about current business and labor market conditions, suggesting the economy will continue to expand at a moderate pace. Expectations regarding business and labor market conditions, as well as personal income prospects, declined slightly as consumers remain cautiously optimistic about growth in the near-term.”

A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth.

The Index is based on a probability-design random sample conducted for The Conference Board by The Nielsen Company.

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West

Arizona: (Hearth, BBQ) “June/July 2016 much better than June/July 2015 overall. Service is down this 2016 summer. More units and new installs planned for 2016 fall.”

Arizona: (Hearth) “Monsoon season is keeping us busy through the summer.”

California: (Hearth, Patio, BBQ, Spas) “Worst July in 11 years. We were ready, but weather was miserably hot.”

California: (Hearth, Patio, BBQ, Spas) “Stoves seem to be picking up, the rest of the merchandise has stayed pretty even. The local change-out is helping us.”

California: (Hearth, Patio, BBQ) “Slow month. For us the exodus of our Canadian part-time residents for summer slows everything down.”

Nevada: (Hearth, BBQ) “S-L-O-W season.”

Washington: (Hearth, Patio, BBQ, Spas) “July was busy but the numbers were down.”

Washington: (Hearth, BBQ) “I’m happy. With our store burning down May 1, and now working at two temporary locations, we are still up without burning ANYTHING!”

Canada

British Columbia: (Hearth, Patio, BBQ, Spas) “Steady but not spectacular is how I would describe July. Down in hot tubs but up everywhere else including fire pit sales, which doubled year over year. Weird weather playing its part with less sunshine and cooler temps slowing shade sales.”

British Columbia: (Hearth) “Slow, slow.”

Ontario: (BBQ) “We are up about 30 percent this year. Back to 2010-2011 sales levels. Hope it continues.”

Ontario: (Patio, BBQ) “Pretty sure when the rains came the sales took a wash. We started the season strong and then the rains and the heat came and we had a ho-hum season. We’re looking forward to an August sale to perk things up again.”


Stock Watch

COMPANY – EXCHANGE SYMBOL 52 WEEK Week Ending % CHANGE MARKET CAPITALIZATION
    High Low 01-JUL-16 29-JUL-16 4 WEEK 26 WEEK 52 WEEK ($000,000)
HNI Corporation (a) HNI 54.14 29.84 46.68 52.13 11.7% 53.2% 5.1% $2,370.0
Pool Corporation (b) POOL 102.85 65.56 95.05 102.28 7.6% 21.0% 45.2% $4,180.0
Rentech (b)(e) RTK 8.40 1.55 2.54 2.56 0.8% 31.3% 236.3%     $59.2
Restoration Hardware Holdings (a) RH 106.49 24.75 30.00 30.81 2.7% -50.5% -69.6% $1,240.0
Wayfair, Inc. (a) W 56.84 28.85 38.06 43.50 14.3% -3.8% 16.6% $4,090.0

(a) = New York Stock Exchange
(b) = NASDAQ
(e) = Rentech is the parent company of New England Wood Pellet, which is the parent company of Allegheny Pellet.

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More Industry Data

2016 June Business Climate

In early July, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare June 2016 sales to June 2015. The accompanying charts and selected comments are from the 198 useable returns.

» Continue

2016 May Business Climate

In early June, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare May 2016 sales to May 2015. The accompanying charts and selected comments are from the 234 useable returns.

» Continue