Manuel Perez De La Mesa
Thank you, Mark, and good morning to everyone on the call. With our 2011 season ending in September, I'd like to start my prepared comments by thanking our teams throughout the company for their execution and commitment to continuous improvement. Our results in a very challenging economic environment are a credit to them.
Well, our third quarter results speak for themselves, especially as the industry is still operating at very depressed levels, with new construction down over 70% from peak levels and replacement remodel activity down 30% from normalized levels. Fortunately, we have continued to gain share, coupled with very modest improvement in consumer discretionary behavior and increases in the installed base.
These increases in share are the result of both our ongoing improvement in service level, as well as our ongoing development of new tools and programs to help our customers' businesses. The execution of both service levels and customer tools and programs are a credit to our teams that make it a reality everyday.
Organic sales growth of 9.4% in the quarter and 9.9% year-to-date are exemplary in this environment, especially if these sales gains were realized without compromising gross margins as these also increase by 61 bps and 63 bps in the quarter and year-to-date, respectively.
It is because of this exemplary performance that our incentive expense in 2011 will be the highest ever. It is important for investors to note that we have a very tight pay-for-performance structure with performance principles based on continuous improvement and considering both absolute and relative performance in context with the industry and the general economic environment.
In the third quarter, our green base business sales increased 8.9%, while our blue base business sales increased by 9.4%, yielding the combined weighted 9.4% increase mentioned earlier.
As noticed, noted in the base business schedule included in our release, sales from acquisitions and new locations were $6 million in the quarter.