MILWAUKEE – September 26 -- Generac Holdings Inc.reported Monday that recent widespread power outages in the Midwest and along the East Coast are expected to drive demand for its backup power generation products into next year.
“The duration and widespread impact of the most recent outage events around the nation was significant,” said Aaron Jagdfeld, president and CEO of town of Genesee-based Generac. “For Generac, the impact of such severe conditions not only increases the immediate demand for our portable generators, but our experience has been that prolonged outages can drive additional awareness for our home standby generators for a period of 12 to 18 months after an event.”
The boost in demand for Generac’s products is expected to have a “significant positive impact” on the company’s third quarter financial results, Jagdfeld said. The company also expects to see elevated demand for its home standby generators in the fourth quarter and into 2012, he added.
Generac’s previous business outlook for residential products called for shipments to be flat year-over-year in the second half of 2011, assuming no major power outages. As a result of the recent events, the company now expects that residential product sales in the third quarter will increase year-over-year by more than 50 percent, driven primarily by portable generator shipments.
In addition, Generac now expects that residential product sales in the fourth quarter will increase year-over-year by about 15 to 20 percent as a result of increased shipments of home standby generators, with demand for these products expected to remain strong into fiscal 2012 in the regions affected by major outages.
The company also reaffirmed its guidance of solid double-digit, full-year growth for commercial and industrial products.
Overall, the company expects to see a “meaningful” increase in earnings for the third quarter compared with its previous outlook as a result of recent events.
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