Graco Q4 2019 Earnings Report
Key Takeaways
Graco Inc. reported a 1% increase in net sales for the fourth quarter, driven by growth in the Americas and EMEA regions, though offset by declines in Asia Pacific. The Contractor segment's strong sales growth and favorable operating leverage boosted profitability, while gross margin rates decreased due to lower factory volume and unfavorable product mix.
Asia Pacific sales declines offset growth in the Americas and EMEA regions.
Strong sales growth in the Contractor segment drove up fourth quarter profitability.
Gross margin rates decreased due to lower factory volume and unfavorable product and channel mix.
Total operating expenses decreased 6 percent.
Graco
Graco
Graco Revenue by Segment
Forward Guidance
Graco anticipates challenging end market conditions in the Industrial and Process segments for the first half of 2020, but remains positive about the Contractor segment. The company projects low single-digit revenue growth on an organic, constant currency basis for 2020.
Positive Outlook
- Favorable conditions continue in the Contractor segment.
- Demand for products is solid across major end markets and product categories in the Contractor segment.
Challenges Ahead
- Challenging end market conditions are expected to remain in place for the Industrial segment for at least the first half of the year.
- Challenging end market conditions are expected to remain in place for the Process segments for at least the first half of the year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income