Sunday, November 10, 2002

Habegger posts 50th profit in 50th year

By Cliff Peale
The Cincinnati Enquirer

Sometime in 2000 the Habegger family faced the moment of truth.

[photo] With a recession looming, Habegger president and chief executive officer Fred Habegger took a chance and expanded the company.
(Brandi Stafford photo)
| ZOOM |
With a recession looming, the owners of heating and air-conditioning distributor Habegger Corp. had plans to expand, with more stores and more employees.

Their choice: Shelve the plans, or take a chance and invest into the recession?

Two years later, Habegger's decision has worked. The company increased annual sales $13 million in 2001, and another $7 million this year, to $135 million, and added about 50 workers.

And in its 50th anniversary year, it's posting its 50th straight profit on the income statement.

President and chief executive officer Fred Habegger, son of the company's founder, said low interest rates and a healthy housing market helped. And other companies troubles' didn't hurt, he said.

"It turned out to be a pretty good decision, because there were people available who might not have become available in better times," he said. "But it was a tough decision to make, because you don't know how serious the recession's going to be."

The growth has pushed Habegger to a No. 35 ranking on the Cincinnati 100 list of the region's biggest privately held companies, based on 2001 revenue. For 2000, Habegger ranked No. 40.

Habegger is typical of the well-established, family-run companies that dot the diversified Tristate economy. Those companies have proven they can grow sales and profits consistently, even in shaky economies.

Habegger distributes Carrier and Bryant heating and air-conditioning systems to dealers in Ohio, Kentucky and Indiana. It employs about 250 workers, with 22 stores in Ohio, Kentucky and Indiana.

Two-thirds of its business is for residential customers, a market that has been thriving because of low interest rates. The commercial market, in contrast, has been stagnant because of the recession, he said.

"The expansion would have been a bad decision for us if interest rates had gone up and new construction had stopped," he said. "We would've really been in trouble."

With more than six other family members in the business, including several in the next generation, Mr. Habegger said the company is "looking forward to the transition."

While he wouldn't reveal specific plans for next year, he said the company doesn't have immediate plans to expand beyond its current geographic base.

Last year, Habegger was named a Family Business of the Year by the Goering Center for Family and Private Business at the University of Cincinnati.

Habegger moved its headquarters to its Winton Place location in 1971. The company acquired the Bryant factory branch offices in Columbus in 1980, and then Carrier's branch operations in Cincinnati and Dayton in 1987.

In 1995, Habegger's expanded geographically again with a major acquisition in Indianapolis.

Throughout that history, the company hasn't forgotten the simple principles underpinning its business, Fred Habegger said.

"We're making a daily Novena that the weather is hot again next summer," he said. "Hot summers make all the difference in the world. You don't replace your air conditioner when it's not running" if the weather is cooler and it's not needed.


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