Newsline

Watsco Announces Actions to Improve Profitability

January 26, 2001
/ Print / Reprints /
ShareMore
/ Text Size+
MIAMI, FL — Watsco, Inc., one of the nation’s largest air conditioning, heating, and refrigeration equipment distributors, announced plans to increase the company’s efficiency and profitability.

This will be accomplished by closing and integrating several locations, eliminating unproductive product lines, and restructuring the company’s manufactured housing operations.

Trimming Locations, Product Lines

In the first facet of the plan, Watsco completed the closure, consolidation, and integration of 25 locations in 2000, in order to improve operating efficiency, reduce overlap in certain markets, eliminate underperforming locations, cut operating costs, and reduce inventory levels.

As a further measure to improve profitability and efficiency, Watsco has planned the closure and integration of seven more locations during the first half of 2001. The company’s location closure and integration includes efforts to retain customers and key employees of the affected locations.

The company has adopted a plan to eliminate a variety of product lines that have unacceptable gross margins and sales growth rates. The exit of these products and reduction of SKUs will occur throughout 2001.

Also, additional products will periodically be added to Watsco’s distribution network in order to leverage its infrastructure and broaden product offerings. Long-term retention of new products will be continually evaluated on the relative strength of gross margins and sales growth.



Manufactured Housing

Sales, Earnings Reports

For the year ending December 31, 2000, Watsco expects to report record sales of approximately $1.3 billion, including same-store sales growth of 6% in the company’s core hvac business.

Watsco is also expected to report operating profit, excluding the impact of restructuring and other charges, of approximately $56 million to 57 million.

Earning per share, also excluding charges, is expected to be $0.98 to $0.99 per share. The company is scheduled to announce its year 2000 operating results on February 8.

As for the year 2001 outlook, Watsco expects earnings per share in the range of $1.15 to $1.17 per share, with overall same-store sales growth of 4-5% based on its current assessment of market conditions in its core residential and commercial air conditioning and refrigeration business, including anticipated market share gains.

More information can be found at www.watsco.com (website).

Publication date: 01/29/2001

Did you enjoy this article? Click here to subscribe to The NEWS Magazine

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

2014 Energy Efficiency Forum

Highlights from the 25th annual Energy Efficiency Forum in Washington, D.C.

Podcasts

NEWSMakers: John Missell

John Missell, vice president and COO of Spectrum Design, joins the program to discuss how his company has utilized geothermal technologies, and we examine the future of renewable energy resources. Posted on Aug. 15.

More Podcasts

ACHRNEWS

NEWS 08-18-14 cover

2014 August 18

Check out the weekly edition of The NEWS today!

Table Of Contents Subscribe

Prohibiting HFCs

EPA is proposing a rule that would prohibit some HFCs in select refrigeration applications. Do you agree with this move?
View Results Poll Archive

HVACR INDUSTRY STORE

plumbing-hvac.gif
2014 National Plumbing & HVAC Estimator

Every plumbing and HVAC estimator can use the cost estimates in this practical manual!

More Products

Clear Seas Research

 

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

DON'T MISS A THING

Magazine image
 
Register today for complete access to ACHRNews.com. Get full access to the latest features, Extra Edition, and more.

STAY CONNECTED

facebook icontwitter iconyoutube iconLinkedIn i con