opeesa executive trends index€¦ · opeesa executive trends index o utdoor p ower e quipment and...
TRANSCRIPT
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OPEESA EXECUTIVE TRENDS INDEX
OUTDOOR POWER EQUIPMENT AND ENGINE SERVICE ASSOCIATIONNovember 2016
1
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TABLE OF CONTENTS
Background Slide 3
Distributor Survey Results Slides 4-41
Manufacturer Survey Results Slides 42-72
2
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OPEESA EXECUTIVE TRENDS INDEX
3
Source: OPEESA Executive Trends Index
65%
35%
OPEESA Respondents
Distributors Manufacturers
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DISTRIBUTOR SURVEY4
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Product CategoriesMowers represent largest product category for OPEESA distributors
5
Source: OPEESA Executive Trends Index
44%
7%
20% 21%
8%
0%
10%
20%
30%
40%
50%
Mowers Engines Handheld Equip. Snow products Other
Category Exposure - Distributors
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Sales by Region88% of distributors have exposure in the South region
6
Source: OPEESA Executive Trends Index
35%
88%
35%
19%
4%
0%
20%
40%
60%
80%
100%
Northeast South Midwest West Other
Geographic Exposure - Distributors
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Customer ExposureOPEESA distributors have a higher exposure to Professional customers 7
Source: OPEESA Executive Trends Index
Consumer, 42%
Professional, 58%
Customer Exposure - Distributors
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NEAR-TERM SALES8
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All Distributors Distributor growth improved 2 points in 3Q and 4Q outlooks are slightly stronger
9
Source: OPEESA Executive Trends Index
8%
6%
5%5%
4%5%
2%
6%
7%
5%
8%
5%
2%3% 3%
6%
4%
3%
7%
1%
3%3%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Distributors
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All DistributorsAugust was the strongest month since March for Distributors 10
Source: OPEESA Executive Trends Index
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - Distributors
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Sales vs Expectations3Q sales growth was below expectations in total
11
Source: OPEESA Executive Trends Index
4%
23%
35%
38%
0%0%
10%
20%
30%
40%
50%
Much better thanexpectations
Better thanexpectations
In-line withexpectations
Worse thanexpectations
Much worse thanexpectations
3Q16 Sales vs Expectations - Distributors
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Weather ImpactWeather was a 0.6 point headwind in 3Q (weighted average)
12
Source: OPEESA Executive Trends Index
12%
15%
19%
27% 27%
0%
10%
20%
30%
40%
Helped sales by morethan 2 points versus
last year
Helped sales by 1-2points versus last year
No impact – weather similar versus last year
Hurt sales by 1-2points versus last year
Hurt sales by morethan 2 points versus
last year
Please estimate the impact of weather on your sales growth during 3Q16.
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13
0% 0%
68%
24%
8%
0%
20%
40%
60%
80%
Helped sales by morethan 2 points versus
last year
Helped sales by 1-2points versus last year
No impact – similar versus last year
Hurt sales by 1-2points versus last year
Hurt sales by morethan 2 points versus
last year
Please estimate the impact of U.S. Headlines on your sales growth during 3Q?
U.S. Headline ImpactU.S. Headlines were a 0.6 point headwind in 3Q (weighted average)
Source: OPEESA Executive Trends Index
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4Q Estimates4Q growth forecasts moved slightly higher last 90 days
14
Source: OPEESA Executive Trends Index
0%
19%
69%
12%
0%0%
20%
40%
60%
80%
Raised forecastmeaningfully
Raised forecastmodestly
No change Lowered forecastmodestly
Lowered forecastmeaningfully
Have you raised or lowered your 4Q sales growth forecast the last 90 days?
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2017 Sales Growth Forecasts19% of distributors raised 2017 sales growth forecasts last 90 days 15
0%
19%
77%
4%0%
0%
20%
40%
60%
80%
100%
Raised forecastmeaningfully
Raised forecastmodestly
No change Lowered forecastmodestly
Lowered forecastmeaningfully
Have you raised or lowered your 2017 sales growth forecast the last 90 days?
Source: OPEESA Executive Trends Index
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Pro Distributors 3Q growth improved 3 points vs 2Q 16
Source: OPEESA Executive Trends Index
7%
6%6% 6%
7%
4%
2%
6% 6%
4%
7%
4%
2% 2%
3%
6%
3%
4%
6%
-1%
2%
2%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Distributors (Pro)
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Pro DistributorsPro Distributors seeing solid recovery since July
17
Source: OPEESA Executive Trends Index
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
16-A
prM
ay-1
6Ju
n-16
2Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - Distributors (Pro)
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Consumer DistributorsConsumer sales growth improved 2 points compared to 2Q
18
Source: OPEESA Executive Trends Index
12%
6%
5%4%
1%
6%
1%
6%
9% 9%9%
5%
2%
4%
3%
7% 7%
-1%
10%
5%
7%
6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Distributors (Consumer)
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Consumer DistributorsConsumer sales accelerated since July 19
Source: OPEESA Executive Trends Index
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
16-A
prM
ay-1
6Ju
n-16
2Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - Distributors (Consumer)
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REGIONAL PERFORMANCE20
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NortheastNortheast distributor growth seeing wide swings month to month 21
Source: OPEESA Executive Trends Index
-5%
0%
5%
10%
15%
20%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - Northeast Distributors
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Northeast4Q expected to improve slightly in the Northeast
22
Source: OPEESA Executive Trends Index
9%
6%
9%
6%
9%8%
-2%
7%
11%
8% 8%8%
-2%
7%
3%
5%
6%
4%
9%
-1%
4%5%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Northeast Distributors
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SouthGrowth up significantly in 3Q 23
Source: OPEESA Executive Trends Index
-10%
-5%
0%
5%
10%
15%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - South Distributors
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South4Q expected to improve nearly 1 point relative to 3Q
24
Source: OPEESA Executive Trends Index
8%
3%
6%
5%
7%6%
1%
7%
10%
5%
8%
3%
2%1%
3%
6%
4%
3%
8%
2%2%
3%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - South Distributors
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MidwestMidwest distributor growth accelerated in 3Q following slow down through July
25
Source: OPEESA Executive Trends Index
-10%
-5%
0%
5%
10%
15%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - Midwest Distributors
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Midwest4Q growth expected to be similar to 3Q 26
Source: OPEESA Executive Trends Index
11%
9%
8%
3%
0% 1%
-2%
8%
9%
4%
9%
5%
3%
6% 6% 7%
5%
3%
6%
2%3% 3%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Midwest Distributors
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WestAugust up 10-15%, September down nearly 10% 27
Source: OPEESA Executive Trends Index
-10%
-5%
0%
5%
10%
15%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6E
Comparable Sales Growth - West Distributors
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West4Q expected to slow a bit further
28
Source: OPEESA Executive Trends Index
10%10%
6%
5%
1%
2%
5% 6%
7%7%
10%
4%
9%
0%
1%
7%
3%
2%
9%
6%
2%1%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - West Distributors
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SALES & FORECASTS29
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Total Forecasts2016 forecasts were reduced nearly 1 point but initial 2017 forecasts 2 points higher than 2016 30
Source: OPEESA Executive Trends Index
8.2%
5.8%
6.6%
5.1%5.5%
6.3%5.9%
6.7%7.1%
4.3%
3.3%
5.2%
0%
2%
4%
6%
8%
10%
2010 2011 2012 2013 2014 2015 3Q15 4Q15 1Q16 2Q16 3Q16 3Q16
Actual 2016E 2017E
Annual Sales Growth Forecasts - Distributors
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Pro ForecastsPro categories now expected to be up nearly 3% in 2016 and initial 2017 forecasts up 4% 31
Source: OPEESA Executive Trends Index
6.7%
5.9%5.6%
4.6%4.2%
5.4% 5.2%
6.6% 6.6%
2.9% 2.8%
4.3%
0%
2%
4%
6%
8%
10%
2010 2011 2012 2013 2014 2015 3Q15 4Q15 1Q16 2Q16 3Q16 3Q16
Actual 2016E 2017E
Comparable Sales Growth - Distributors (Pro)
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Consumer ForecastsDistributors still forecasting solid Consumer growth (up nearly 5%) in 2016 and initial 2017
forecasts show sales increasing 8%32
Source: OPEESA Executive Trends Index
11.6%
6.4%
3.9%
6.4%
8.3% 8.3%7.8%
6.8%
8.3%
6.7%
5.0%
8.3%
0%
5%
10%
15%
2010 2011 2012 2013 2014 2015 3Q15 4Q15 1Q16 2Q16 3Q16 3Q16
Actual 2016E 2017E
Comparable Sales Growth - Distributors (Consumer)
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Industry GrowthDistributors forecasting mowers to see the highest growth in 2016 33
Individual categories may not add to total industry due to rounding and categories not included in the above chartSource: OPEESA Executive Trends Index
0.0%
4.4%
3.0%
2.3%
1.7%
3.2%3.5%
0%
2%
4%
6%
Total 2016E Pro mowers Consumermowers
Engines HandheldEquip.
Parts/Repair Other
2016 Industry Forecast - by Category
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INVENTORY, PRICE, & HEADCOUNT34
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InventoryDistributor inventory levels moved higher last 90 days
35
Source: OPEESA Executive Trends Index
-0.8%
2.6%
5.9%
2.9%
2.1%
2.7%
3.9%
5.1%
3.6%
2.1%
3.0%
1.5%
4.1%3.6%
3.2%
2.5%
4.4%
-2%
0%
2%
4%
6%
8%
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
Inventory Position Year/Year - Distributors
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InventoryDistributor inventory levels exited 3Q higher than expected 36
Source: OPEESA Executive Trends Index
35%
58%
8%
0%
20%
40%
60%
80%
Higher than expected In-line with expectations Lower than expected
Inventory vs Expectations - Distributors
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Snow Season2016/2017 snow season expected to improve versus 2015/2016 37
Source: OPEESA Executive Trends Index
-4%-4%
-6%
3% 3%3%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
Total Pro Con
What is your initial forecast for the 2016/2017 snow selling season?Final 2016 2016/2017E
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Snow SeasonSnow inventory levels are elevated for 51% of distributors 38
Source: OPEESA Executive Trends Index
38%
13%
50%
0% 0%0%
20%
40%
60%
80%
Extremely high Slightly high In-line Slightly low Extremely low
Snow Inventory Level at Retail
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PriceDistributors saw OPE manufacturers increase price by 1.5% in 2016 (weighted average) 39
Source: OPEESA Executive Trends Index
4%
23%
50%
15%
8%
0% 0%0%
20%
40%
60%
None 0-1% 1-2% 2-3% 3-4% 4-5% 5%+
2016 Manufactures Price Increase Forecast
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PriceDistributors expect manufacturers to increase price by 1.5% in 2017 (weighted average) 40
Source: OPEESA Executive Trends Index
15% 15%
46%
12% 12%
0% 0%0%
20%
40%
60%
None 0-1% 1-2% 2-3% 3-4% 4-5% 5%+
2017 Manufactures Price Increase Forecast
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Headcount31% of OPEESA distributor respondents plan to increase headcount in the near-term
41
Source: OPEESA Executive Trends Index
31%
58%
12%
0%
20%
40%
60%
80%
Net increase No change Net decrease
Headcount Change in Next 90 Days
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MANUFACTURER SURVEY42
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Product Categories“Other” categories represents the largest product group for OPEESA Manufacturers 43
Source: OPEESA Executive Trends Index
22%
18%
7%
15%
38%
0%
10%
20%
30%
40%
50%
Mowers Engines Handheld Equip. Parts/Repair Other
Category Exposure - Manufacturers
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Customer ExposurePro 59%, Consumer 41% 44
Source: OPEESA Executive Trends IndexIndividual categories may not add to total industry due to rounding and categories not included in the above chart
Consumer, 41%
Professional, 59%
Customer Exposure - Manufacturers
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NEAR-TERM SALES45
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All Manufacturers3Q sales increased 2% for manufacturers 46
Source: OPEESA Executive Trends Index
10%9%
5%
7%
2%
7%
3%
7%
8%
7% 7%
5%5%
4%
4%
6%
3%
1%
5%
4%
2%
0%
0%
2%
4%
6%
8%
10%
12%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Manufacturers
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All ManufacturersMonthly sales growth slowing last 3-4 months 47
Source: OPEESA Executive Trends Index
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6 E
Comparable Sales Growth - Manufacturers
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Sales vs. ExpectationsManufacturer sales growth mostly in-line with expectations in 3Q
48
Source: OPEESA Executive Trends Index
0%
29%
43%
21%
7%
0%
10%
20%
30%
40%
50%
Much better thanexpectations
Better thanexpectations
In-line withexpectations
Worse thanexpectations
Much worse thanexpectations
3Q16 Sales vs Expectations - Manufacturers
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49
Source: OPEESA Executive Trends Index
Weather ImpactManufacturers saw a 0.9 point negative impact from weather in 3Q (weighted average)
0% 0%
57%
29%
14%
0%
20%
40%
60%
80%
Helped sales by morethan 2 points versus
last year
Helped sales by 1-2points versus last year
No impact – weather similar versus last year
Hurt sales by 1-2points versus last year
Hurt sales by morethan 2 points versus
last year
Please estimate the impact of weather on your sales growth during 3Q16.
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50
0% 0%
57%
29%
14%
0%
20%
40%
60%
80%
Helped sales by morethan 2 points versus
last year
Helped sales by 1-2points versus last year
No impact – similar versus last year
Hurt sales by 1-2points versus last year
Hurt sales by morethan 2 points versus
last year
Please estimate the impact of U.S. Headlines on your sales growth during 3Q16.
Source: OPEESA Executive Trends Index
U.S. Headline ImpactManufacturers saw a 0.9 point negative impact from U.S. Headlines in 3Q (weighted average)
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4Q Estimates36% of manufacturers lowered 4Q sales growth targets last 90 days 51
Source: OPEESA Executive Trends Index
0%
7%
57%
29%
7%
0%
20%
40%
60%
80%
Raised forecastmeainingfully
Raised forecastmodestly
No change Lowered forecastmodestly
Lowered forecastmeainingfully
Have you raised or lowered 4Q sales growth expectations the last 90 days?
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Pro ManufacturersPro sales growth pretty flat last 4 months 52
Source: OPEESA Executive Trends Index
-3%
0%
3%
6%
9%
12%
15%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6 E
Comparable Sales Growth - Manufacturers (Pro)
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Pro ManufacturersPro sales growth expected to decrease 1% in 4Q
53
Source: OPEESA Executive Trends Index
15%
12%
7% 7% 7%
12%
7% 7% 7%6%
3%
6%
8%
6%
2%
6%
4%
1%
4%5%
0%
-1%-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Manufacturers (Pro)
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Consumer ManufacturersConsumer sales higher in 3Q vs 2Q
54
Source: OPEESA Executive Trends Index
-15%
-10%
-5%
0%
5%
10%
15%
20%
2010
2011
Jan-
12Fe
b-12
Mar
-12
Apr
-12
May
-12
Jun-
12Ju
l-12
Aug
-12
Sep-
12O
ct-1
2N
ov-1
2D
ec-1
2Ja
n-13
Feb-
13M
ar-1
3A
pr-1
3M
ay-1
3Ju
n-13
Jul-1
3A
ug-1
3Se
p-13
Oct
-13
Nov
-13
Dec
-13
Jan-
14Fe
b-14
Mar
-14
Apr
-14
May
-14
Jun-
14Ju
l-14
Aug
-14
Sep-
14O
ct-1
4N
ov-1
4D
ec-1
4Ja
n-15
Feb-
15M
ar-1
5A
pr-1
5M
ay-1
5Ju
n-15
Jul-1
5A
ug-1
5Se
p-15
Oct
-15
Nov
-15
Dec
-15
Jan-
16Fe
b-16
Mar
-16
Apr
-16
May
-16
Jun-
16Ju
l-16
Aug
-16
Sep-
16O
ct-1
6 E
Comparable Sales Growth - Manufacturers (Consumer)
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Consumer ManufacturersConsumer sales growth expected to slow in 4Q
55
Source: OPEESA Executive Trends Index
5%
7%
2%
6%
-3%
1%
-1%
6%
11%
9%
11%
1%3%
1%
7%
5%
1%2%
8%
2%
5%
3%
-5%
0%
5%
10%
15%
2010
2011
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
E
Comparable Sales Growth - Manufacturers (Consumer)
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SALES & FORECASTS56
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ForecastsManufacturers now expecting 2016 full year growth up 4% and initial 2017 forecasts show
sales increasing by 3%57
Source: OPEESA Executive Trends Index
10%9%
5%
6%
8%
6%
4%3%
0%
2%
4%
6%
8%
10%
12%
2010 2011 2012 2013 2014 2015 2016E 2017E
Annual Sales Growth Forecasts - Manufacturers
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Forecasts36% of manufacturers lowered 2016 growth forecasts last 90 days 58
Source: OPEESA Executive Trends Index
0%
7%
57%
36%
0%0%
20%
40%
60%
80%
Raised our forecastmeaningfully
Raised our forecastmodestly
Unchanged Lowered our forecastmodestly
Lowered our forecastmeaningfully
Changed 2016 Forecasts? - Manufacturers
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Forecasts29% of manufacturers lowered 2017 growth forecasts last 90 days
59
0%
21%
50%
29%
0%0%
20%
40%
60%
Raised our forecastmeaningfully
Raised our forecastmodestly
Unchanged Lowered our forecastmodestly
Lowered our forecastmeaningfully
Have you raised or lowered your 2017 sales growth expectations over the last 90 days?
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Forecasts2016 sales growth forecasts remained similar over the last 90 days and initial 2017 forecasts
show sales increasing by 3%+60
Source: OPEESA Executive Trends Index
10%9%
5%
6%
8%
6%
10%
8% 8%
4% 4%3%
0%
2%
4%
6%
8%
10%
12%
2010 2011 2012 2013 2014 2015 3Q15 4Q15 1Q16 2Q16 3Q16 3Q16
Actual 2016E 2017E
Annual Sales Growth Forecasts - Manufacturers
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Pro ForecastsPro categories expected to increase 2% in 2016 and initial 2017 forecasts show sales increasing by
3%61
Individual categories may not add to total industry due to rounding and categories not included in the above chartSource: OPEESA Executive Trends Index
15%
12%
6%7%
10%
5%
2%
3%
0%
5%
10%
15%
2010 2011 2012 2013 2014 2015 2016E 2017E
Comparable Sales Growth - Manufacturers (Pro)
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Consumer ForecastsConsumer categories expected to increase 8% in 2016 and initial 2017 forecasts show sales
increasing by 4%62
Individual categories may not add to total industry due to rounding and categories not included in the above chartSource: OPEESA Executive Trends Index
5%
7%
2%
6%
4%
6%
8%
4%
0%
2%
4%
6%
8%
10%
2010 2011 2012 2013 2014 2015 2016E 2017E
Comparable Sales Growth - Manufacturers (Consumer)
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Industry GrowthManufacturers forecasting total OPE industry flat in 2016 and initial 2017 forecasts show sales
increasing by 3% year/year63
Source: OPEESA Executive Trends IndexIndividual categories may not add to total industry due to rounding and categories not included in the above chart
0%
4% 4%3%
-8%
1%3%3%
3% 3%
2%
-3%
4%
6%
-10%
-5%
0%
5%
10%
Total 2016E Pro mowers Consumermowers
Engines HandheldEquip.
Parts/Repair Other Equip.
What is your current INDUSTRY forecast for 2016 growth by end market (excluding acquisitions)?
Final 2016 2017E
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INVENTORY, HEADCOUNT, & COSTS64
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InventoryManufacturers’ dealer inventory positions up nearly 3% exiting 3Q 65
Source: OPEESA Executive Trends Index
2%
0%
1% 1%
0%
-1%
4%
0%0%
3%4% 3%
3%
0%
2%2%
3%
-2%
-1%
0%
1%
2%
3%
4%
5%
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
Dealer Inventory Year/Year - Manufacturers
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Inventory31% of respondents saw dealer inventory higher than expected exiting 3Q due to soft sales 66
Source: OPEESA Executive Trends Index
0%
31%
54%
15%
0%
20%
40%
60%
Higher than expected dueto bullish forecasts
Higher than expected dueto soft sales
In-line with expectations Lower than expected
Dealer Inventory vs Expectations - Manufacturers
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Inventory31% of manufacturers estimate their dealers are heavy on inventory
67
Source: OPEESA Executive Trends Index
31%
20%
17%
9%
22%
55%
23%
13%
22%
27%30%
33%
10%
31% 31%
0%
20%
40%
60%
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
Dealer Inventory Above Expectations by Quarter - Manufacturers
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Snow Season25% of manufacturers suggest snow inventory is higher than expected 68
Source: OPEESA Executive Trends Index
0%
25%
75%
0% 0%0%
20%
40%
60%
80%
100%
Extremely high Slightly high In-line Slightly low Extremely low
Snow Inventory at Retail
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HeadcountAlmost 30% of manufacturers plan to increase headcount next 90 days
69
Source: OPEESA Executive Trends Index
29%
71%
0%0%
20%
40%
60%
80%
Net increase No change Net decrease
Headcount Next 90 Days - Manufacturers
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Labor Situation50% of manufacturers estimate labor situations have improved since last year 70
50%
21%
29%
0%
20%
40%
60%
Modestly better No change Modestly tighter
Estimate the landscape/contractor market's current labor situation vs this time last year.
Source: OPEESA Executive Trends Index
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Input CostsManufacturers forecasting minimal cost inflation in 2017
71
Source: OPEESA Executive Trends Index
1.1%1.2%
-0.7%
1.2%
0.8%
1.0%
1.4%
0.8%
0.2%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2013 2014 2015 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
Actual 2016E 2017E
Cost Inflation Year/Year - Manufacturers
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Please look for the next OPEESA survey in January
72