Minneapolis, Minnesota — Sales for Graco, which makes polyurethane spray equipment, grew by 4% in the second quarter of 2016 and 2% over the first half of the year, driven by a 10% rise in sales in its contractor spray systems business segment.
Graco's industrial segment, which includes sales from polyurethane spray guns, grew sales by 2% in the quarter and in the first half of the year, Graco said in an SEC filing. Sales in the industrial segment for 2016 were $157 m up from $154 m in the equivalent quarter in 2015.
Second quarter sales in the industrial segment saw 10% growth in Europe, the Middle East and Africa as well as a 4% rise in Asia Pacific. There was a 3% decline in sales the Americas, the company said. Operating margin rates in the industrial segment were consistent with last year, the firm added.
Graco added that its profitability in the second quarter of 2016 was hit by a number of factors, including: sales mix, lower factory volume, facility moves and integration activities and the cost of new product launches in the contractor segment. "Although overall demand trends remain variable from region to region, and between product categories, we remain steadfast in our commitment to investing in long-term growth initiatives," said the firm.
Overall, sales across the business were $348 m in the second quarter of 2016, compared with $355 m in the same period of 2015. In the first half of 2016 sales were $653 m compared with $614 m in the first half of 2015. Operating earnings were down 7% in the second quarter at $78 m, compared with the same period in 2015. In the first half of 2016 operating earnings were $139 m down 7% on the $149 m in the 2015 half.