Volume 9, Issue 10 - November 2008

Industry Indices.

Experts Say Bright Spots are Ahead,
Even If Distant, for Market

During a seminar held during GlassBuild America, several experts addressed the state of the door and window market—particularly in relation to the economy. While the discussion was a sobering one, the speakers—which included an investment banker, economist and two industry representatives—seemed to agree eventually, things will get better.

“Please understand, we believe we will come through this,” said Jeff Dietrich, an economist for the Institute for Trend Research,” but there’s some pain and discipline necessary to get there.”

Dietrich also noted that 2009 may not necessarily improve a good deal as far as the housing market is concerned, but that it won’t seem as drastic as recent years.

“We do not expect housing to turn around in any dramatic fashion, but it will feel better than 2007 and 2008,” he warned.

He encouraged manufacturers to maintain a strong cash position until things do pick up, and to take initiative and be innovative.

Dietrich also encouraged attendees to try to rid themselves of debt. “It’s not like [the Feds] are going to take your debts off the books—it’s up to you,” he advised. On a positive note, Dietrich said he expects the home improvement market to grow at a rate of 3 to 5 percent by 2015.

Andrew Bohutinsky, an investment banker with Lincoln International, which focuses on mergers and acquisitions, had some good news to share as well. He noted that while mergers and acquisitions are down right now, the middle market, into which many door and window manufacturers fall, is normally more resilient than other markets.

Bohutinsky also mentioned that he has seen fewer purchases in the fenestration market by private equity firmsand expects this to continue.

“The financing market has pretty much come to a standstill in the last two weeks,” he said. “You’re not going to see many private equity buys before the end of the year.”


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