Revenue is on the rise at PoolCorp. Sales figures for the distribution giant often are seen as an indicator of the industry’s health overall.
According to investor presentations made this spring and summer by
company executives, PoolCorp expects to see annual revenue growth
of 6- to 12 percent in the next five years, thanks to market share
gains, market recovery, inflation, and other factors.
In 2011, the Covington, La.-based company reported revenues
of $1.8 billion after hitting its post-boom low of $1.5 billion in
With its markets now beginning to recover, the company is seeing
improvement in its core business of selling products for U.S. pools
and spas. In the first quarter of 2012, revenue increased 13.6
percent for this part of PoolCorp’s business, which
represents more than 80 percent of the company’s
But there were some regional differences that emerged early this
year, according to PoolCorp President/CEO Manual Perez de la Mesa.
While the company notched a 7 percent sales gain in California,
Texas and Arizona, PoolCorp saw a sales jump of 18.1 percent in
Florida and other East Coast markets in the first quarter.
“I believe that 7 percent is more reflective of our
expectations for the balance of 2012, with roughly half of that
growth coming from [market] share increases, and the other half
from market expansion and inflation,” Perez said.
As the economy improves, PoolCorp told investors that it predicts
“significant catchup demand” through 2018 for pool
renovation and replacement.
But it’s a different story for new pools. “We’re
thinking that new construction activity on the pool side is still
extremely depressed,” Perez said during a conference call.
“We believe it will be up modestly this year. Modestly, maybe
5,000 to 7,000 more pools being built this year than last year. But
it’s still a fraction of what it was at peak, and probably 40
percent of normal.”
Finally, the company wants to increase its international business,
which is currently responsible for 10 percent of annual revenue.
The areas of concentration? Large markets in Europe and Canada,
which offer the potential for market share and sales gains. To grow
its presence in those areas, PoolCorp has been turning to
acquisitions, which executives say can be a cost-effective way of
entering new markets.
So far in 2012, it has bought the distribution assets of two
different Canadian firms, adding a net of five sales centers
through acquisitions in the first quarter alone.