March pending home sales rise
The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 4.1% to 101.4 in March from an upwardly revised 97.4 in February and is 12.8% above March 2011 when it was 89.9, according to the National Association of Realtors. The data reflect contracts but not closings.
The index is now at the highest level since April 2010 when it was 111.3.
“First-quarter sales closings were the highest first-quarter sales in five years,” said Lawrence Yun, NAR chief economist. “The latest contract signing activity suggests the second quarter will be equally good.
“The housing market has clearly turned the corner. Rising sales are bringing down inventory and creating much more balanced conditions around the county, which means home prices will be rising in more areas as the year progresses,” he added.
The PHSI in the Northeast slipped 0.8% to 78.2 in March but is 21.1% above March 2011. In the Midwest, the index declined 0.9% to 93.3 but is 16.9% higher than a year ago. Pending home sales in the South rose 5.9% to an index of 114.1 in March and are 10.6% above March 2011. In the West, the index increased 8.7% in March to 108.0 and is 9.0% above a year ago.
A. O. Smith posts positive Q1
A. O. Smith Corp. has posted first-quarter net earnings of $47.5 million, compared with $24.2 million in the prior-year quarter. Net earnings included an after-tax gain of $16.7 million, related to the sale of shares of Regal Beloit Corporation, which were received from the 2011 divestiture of the electric motor business.
First-quarter sales totaled $468.6 million, up 12% from sales of $417.4 million for the same period last year. The company cited first-quarter contributions from Lochinvar, which was acquired in August 2011, and an 18% increase in sales of A. O. Smith-branded product in China.
“Two highlights in the quarter came from our higher growth businesses,” said Paul Jones, chairman and CEO. “Lochinvar grew more than 10%, and our sales of A. O. Smith-branded products in China continued to grow at a double digit rate.”
Sales of the North America segment, which includes the U.S. and Canada water heater and boiler businesses, increased 10% to $353.3 million from first-quarter 2011 sales of $321.7 million.
Outside of North America, which consists of the China, India and Europe water heating businesses and the water treatment business in Asia, first-quarter sales totaled $124.2 million, up 18% from first quarter 2011 sales of $105.2 million. Higher sales of A. O. Smith branded products in China, driven in part by a pre-buy ahead of an April 2012 price increase, were the primary reason for the sales increase.
During the first quarter, A. O. Smith broke ground for a new 457,000-sq.-ft. water heater plant in Nanjing, China. The new plant will accommodate increased water heater demand as well as growth for new products recently introduced in the China market, including the heat pump, solar and combi boiler.
Toro acquires assets of Stone Construction Equipment
Bloomington, Minn.-based Toro has acquired light construction and hardscape product assets of Stone Construction Equipment, which manufactured concrete and hardscape equipment for rental and construction companies. Terms of the transaction were not disclosed.
This acquisition builds on the company’s position in the rental market with a line of branded products in the hardscape space, including concrete and mortar mixers, material handlers, compaction equipment, and other concrete power tools. These products extend Toro’s offering to contractors and rental companies, and complement its recent acquisitions of tree care and turf renovation product lines.
“Stone built a solid reputation around quality,” said Rick Rodier, general manager of Toro’s Sitework Systems Business. “These products are respected by rental and construction customers, and complement our current line of compact utility equipment and trenchers extremely well. We see great opportunity to leverage our core strengths in innovation, engineering and distribution to grow share in these new categories.”