Town of Genesee-based
Generac is expecting a return to sales growth this year after reporting an overall decline of 12% in 2023.
The company's net sales fell from about $4.56 billion in 2022 to about $4 billion in 2023. Its net income fell 46.2% from about $399.5 million in 2022 to about $214.6 million in 2023.
Despite the declines in sales and profits in 2023, the manufacturer of generators and energy management products did see sales growth return in both its residential and C&I (commercial and industrial) segments in the fourth quarter of the year.
For the fourth quarter, Generac reported a net sales increase of 1% to $1.06 billion. Residential product sales increased 1% to $580 million and commercial and industrial product sales saw a slight increase of less than 1%.
Even with the fourth quarter of 2023 recording the lowest amount of power outage hours in the U.S. since 2015, several smaller-scale weather events did lead to power disruptions, helping boost demand for Generac’s suite of products.
Fourth quarter home standby shipments increased 10% from the prior year despite continued field inventory destocking and fewer power outages across the country.
Global C&I product sales also reached an all-time record of $1.5 billion in 2023. It was the third consecutive year Generac’s C&I segment achieved double digit growth.
“Throughout 2023, the megatrends we believe will drive our longer-term growth were on full display as increasingly severe weather coupled with the continued evolution of the energy grid in the U.S. further demonstrated the important role our products and solutions can provide to the market,” said
Aaron Jagdfeld, chief executive officer of Generac.
In 2023, the company also continued to make sizable investments in its engineering and manufacturing capabilities, opening a new engineering center of excellence in Reno, Nevada and breaking ground on a new manufacturing facility
in Beaver Dam to increase capacity for C&I products.
In 2024, the company expects shipments of its home standby generators to continue to grow. Generac initiated full-year 2024 net sales growth guidance of between 3% and 7%. That growth is expected to be led by shipments of home standby generators and residential energy technology products. Generac anticipates a 10% decrease in C&I product sales this year due to dwindling demand from some telecom customers. This decrease will be offset by the increase in residential products.
“In 2024, we expect to return to consolidated sales growth and year-over-year margin expansion for the full year period while also continuing to invest for future growth,” said Jagdfeld. “Importantly, the mega-trends that support these expectations as well as our robust long-term growth outlook remain firmly intact. As reliance on electricity continues to increase and supply-demand imbalances remain a challenge for grid operators, we will continue to execute our strategic plan to lead the evolution to more resilient, efficient, and sustainable energy solutions.”
