ELECTRICAL AND DATACOM firms started 2017 on a posi- tive note for revenues and pricing. They also showed cau- tious optimism about the upcoming quarter and the year as a whole, according to the first-quarter survey that securities analyst Robert W. Baird & Co. conducted in partner- ship with tED magazine. The partnership, which dates back to 2009, covered 75 respondents: 73 distributors, one manufacturer, and one “other.” One firm handles data- com only, 49 electrical only, and 25 do both (and are counted with the datacom respondents). Combined annual revenue of participating businesses tops $10 billion. More than 40% of the com- panies have revenue of less than $10 million, while revenue exceeds $500 million each for a few firms in the survey. Geographically, en- terprises serving the Midwest make up 38% of the respondents, followed by businesses serving the South (19%), Northeast and West (18% each), Canada (4%), and interna- tional markets (3%).
Revenues Rebound For both electrical-only and data- com firms, year-over-year reve- nues rebounded in the January-to- March quarter after dipping in the previous three months. In fact, the 4.7% year-over-year gain for electri- cal firms was the strongest improve- ment since 2014. The figure con- trasts strongly with the 1.8% decline recorded in the year ending in De-
cember 2016. Baird reported, “Our conversations with survey partici- pants revealed some loosening in industrial MRO spending, as well as a rebound in nonresidential construc- tion activity.” Out of 20 industrial groups sur-
The Q1 Baird Survey shows more upbeat results and
expectations than have appeared in many quarters. by Ken Simonson
veyed by Baird, only plumbing firms reported a larger revenue gain: 5.4%. The all-industry aver- age was 3.4%. Datacom respondents reported a more modest 1.4% year-over-year pickup in the first quarter. Never- theless, that was a marked change from the 2.3% decrease in the final quarter of 2016. Firms of both types posted rev- enue gains in all regions. Among electrical-only businesses, increases fell short of 4% only in the North- east. Datacom respondents reported revenue growth of 1% or less every- where except in the Midwest, where the pickup was 3%.