May 16, 2018
Home Depot Sales Rise
The Home Depot had sales of $24.9 billion for the first quarter of fiscal 2018, a 4.4 per cent increase from sales of $23.9 billion in the first quarter of fiscal 2017. Comparable sales for the first quarter of fiscal 2018 were positive 4.2 per cent, and comparable sales in the U.S. were up 3.9 per cent. Net earnings were $2.4 billion, an increase of 19.4 per cent compared with net earnings of $2 billion in the year-ago period. Online sales growth increased 20 per cent over the previous corresponding period. Categories that were at or above the company average include lumber, building materials, flooring, paint, hardware, and tools. Strong pro categories include lumber, gypsum, insulation, and pneumatics.
Groupe BMR Launches Show For Overseas Suppliers
Groupe BMR is holding an ‘Imports and Seasonal Trade Show’ to compensate for its overseas suppliers’ increasingly long delivery times and to make sure BMR dealers receive their merchandise well on time for spring. Among the categories dealers will find at the show are patio furniture, barbeques and accessories, and garden lights, decorations, and accessories. It takes place August 28 to 29 in Boucherville, QC, and is not open to the public.
Castle Celebrates 55 Years Of Success
On May 10, Castle Building Centres Group Ltd. hosted an open house in its Mississauga, ON, offices to celebrate its 55th anniversary. Approximately 200 guests from across Canada including the Castle board of directors, members, vendor partners, and present and past employees attended the event. The catered affair included gourmet food stations, a live jazz duo, giveaways, and concluded with a presentation. Ken Jenkins, president; James Jones, vice-president of national marketing; and Keith Richardson, chairman and owner of Keith’s Building Supplies in New Brunswick; addressed the crowd and unveiled a $5,000 donation to the Hospital For Sick Children to commemorate the event. Jenkins said that Castle’s success is built on strong partnerships and good people. For pictures of the event, visit Home Improvement Retailing’s Instagram Page
Stress Test Impacts Home Sales
Home sales across the country fell from March to April, says the Canadian Real Estate Association (CREA). National home sales fell 2.9 per cent from March to April while actual (not seasonally adjusted) activity fell 13.9 per cent. About 60 per cent of all local housing markets reported fewer sales, led by the Fraser Valley, BC; Calgary, AB; Ottawa, ON; and Montreal, QC. As well, the number of newly-listed homes declined 4.8 per cent in the period. “The stress-test that came into effect this year for homebuyers with more than a 20 per cent down payment continued to cast its shadow over sales activity in April,” says Barb Sukkau, president of CREA. The stress test has lowered sales activity and destabilized market balance for housing markets in Alberta, Saskatchewan, and Newfoundland and Labrador. The number of newly-listed homes declined 4.8 per cent in April. Having reached a nine-year low for the month, new listings stood 12 per cent below the 10-year monthly moving average.
Smartphone Shopping Changing Retail
Smartphone shopping is expected to peak globally in the coming few years with 43 per cent of consumers already making purchases on their phone weekly, says a survey by Ericsson Consumer & IndustryLab. On top of that, the majority of smartphone shoppers expect most people to have a personal shopping advisor within three years which will create an emerging demand for digital shopping assistants to help with purchase decisions. As well, 69 per cent of AR and VR users think technologies will give smartphones all the benefits of physical stores within three years. Ericsson says soon smartphone users will rely on digital assistants in their phones for aspirational shopping support, while simultaneously driving the use of smart home speakers for automation of routine household purchases. Selecting the type of shopping assistant for home and personal purchases will soon be more important than the actual purchase decision. For example, 63 per cent of smartphone shoppers want help with price comparisons – a likely role for a home restocking assistant. And 48 per cent want help making shopping decisions easy – a likely role for a personal shopping advisor.
Home, Building Products Drive Griffon Revenues
Griffon Corporation had revenue of $478.6 million for the second quarter of 2018, an increase of 25 per cent from the second quarter of 2017. Home and building products (HBP) segment revenue increased 39 per cent year-over-year. Income from continuing operations was $2 million, even with the year-ago period. Segment-adjusted EBITDA was $43.8 million, an increase of 11 per cent year-over-year, primarily driven by HBP revenue growth. HBP had adjusted EBITDA of $39.8 million, an increase of 44 per cent compared to the prior-year quarter.
Hydroponics Segment Slows Scotts Miracle-Gro Sales
Scotts Miracle-Gro Company had sales of $1.01 billion for the second quarter of 2018, down seven per cent over sales of $1.08 billion in the second quarter of 2017. The U.S. consumer segment sales declined six per cent to $920.2 million for the quarter. Hawthorne segment sales for the hydroponics marketplace decreased 29 per cent to $41.8 million. Company-wide gross margin rates decreased 240 basis points to 40.4 per cent. Income from continuing operations was $152.7 million compared with $154.1 million in the year-ago period.
May 15, 2018
Lowe’s Canada To Convert Calgary RONA
The RONA Home and Garden store in Calgary, AB, will be converted to the Lowe’s banner. Lowe’s Canada has started an extensive renovation which is expected to be complete by the fall. The transformation will involve construction, departmental sequencing of new racking and re-merchandising, branding, and IT conversion. As well, the company will provide employees with extensive training focused on new product knowledge and customer service. The store will feature an enhanced product assortment including top brands and the introduction of appliances. It will also offer Lowe’s Canada’s private label brands. Services offered will include installation programs across many categories; protection plans for products such as appliances, tools, and outdoor power equipment; and an online program which includes click and collect for in-store pickup, local truck delivery, and parcel shipping.
Shopify To Open First Bricks-and-mortar Location
In a bid to attract and keep more retailers on its eCommerce platform, Shopify Inc.’s first brick-and-mortar location will open later this year. The Ottawa, ON-based company says that its first physical space for clients, a hub for retailers to get support for growing their business, will open in 2018. However, it has not disclosed a location. The physical space will cater to small businesses to collaborate or use for events or sell products for a few days. The company will also launch upgrades to its point-of-sale offerings, including in-store pickup, multi-channel return and exchange options, Apple and Google pay, and single-tap payments.
Consumers Want Personalized Content
Consumers are increasingly interested in content that reflects their personality type and is delivered in their preferred tone and style, says research by Reuters Plus. ‘The Content Connect II’ report reveals that 77 per cent of global consumers expect to see more personalized content in the future. In fact, branded content campaigns are more effective if they include personalized elements, with 63 per cent of consumers agreeing that personally relevant content improves how they feel about the brand associated with it and 58 per cent see brands in a more positive light if they provide them with content that matches their interests. As well, global consumers consider sponsored content more appealing if it is thought-provoking (64 per cent), imaginative (58 per cent), humorous (55 per cent), and innovative (51 per cent). Consumers are also open to new and innovative ways to engage with content, revealing a mix of appealing formats for consumers with short articles (64 per cent), in-depth analysis (60 per cent), video (55 per cent), and infographics (45 per cent) being the top choices. In terms of formats, 71 per cent of consumers interested in branded content would prefer to see their favourite brands sponsoring websites, site sections, or pages, whereas 57 per cent would prefer to see brands sponsoring articles on websites, webpages, or apps.
Visa, PayPal Extend Canadian Partnership
Visa and PayPal have extended their partnership to Canada to work collaboratively towards the acceleration the adoption of secure, reliable, and convenient digital and mobile payments for consumers and merchants in Canada. The partnership will allow consumers to pay with their Visa card at places that accept PayPal. Through collaboration between bank partners and PayPal, consumers will be able to add Visa cards into the PayPal digital wallet via other banking apps. It also enables PayPal to leverage Visa Direct (Visa's real-time payments solution), which allows Visa cardholders to more easily move funds from their PayPal account to an eligible Visa debit card in real-time.
Henkel Acquiring JemPak
Henkel has signed an agreement with Acasta Enterprises Inc. to acquire JemPak Corporation, Canada. JemPak Corporation is based in Concord, ON. With has sales of around $90 million per year, the company is focused on the Canadian and U.S. laundry and home care retailer brands business and offers products in categories such as automatic dishwashing, laundry caps, and fabric finishers. It operates two manufacturing sites.
Amazon.com Sales Strong
Amazon.com, Inc. had net sales of $51 billion for the first quarter of 2018, an increase of 43 per cent over net sales of $35.7 billion in the first quarter of 2017. Excluding the $1.6 billion favourable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 39 per cent compared with first quarter of 2017. Net sales for North America were $30.7 billion versus $21 billion. Operating income increased 92 per cent to $1.9 billion in the first quarter, compared with operating income of $1 billion. Net income was $1.6 billion compared with net income of $724 million.
Trex Sales Up 18 Per Cent
Trex Company, Inc. had consolidated net sales of $171 million for the first quarter of 2018, an 18 per cent increase over net sales of $145 million in the first quarter of 2017. Trex residential products net sales were up seven per cent to $155 million, with commercial products at $16 million. Consolidated gross margin for the quarter was 44.8 per cent, while gross margin for residential products expanded 260 basis points to 47.6 per cent. Net income for the quarter was $37 million, up 33 per cent from the net income of $28 million in the year-ago period.
May 14, 2018
NAFTA Exit Would Cost U.S. Retailers
The near-term cost to U.S. retailers of exiting NAFTA (North American Free Trade Agreement) is estimated at $15.8 billion, says a study by A.T. Kearney. ‘How NAFTA Affects U.S. Retail’ quantifies the impact of a potential withdrawal from the treaty and outlines what changes retailers should expect in the event that the U.S. exits from the pact. The report shows the American retail landscape is in danger of being undercut and quantifies direct and indirect margin impact across all sectors of retail. With the retail industry importing $182 billion of goods from NAFTA partners, the cost to retailers could amount to as much as $15.8 billion in added tariffs and reduced margins. Additionally, the impact on retail employment could be losses of over 100,000 jobs within the next three years. “NAFTA has dramatically influenced the U.S. economy, the retail sector, and Americans’ standard of living,” says Johan Gott, principal at A.T. Kearney and co-author of the study. “From the time it came into force, retailers have gradually become de facto importers because their customers demand the products that NAFTA allows them to purchase easily, affordably, and with great variety. Retailers, then, are agents without the protections that other importers enjoy.”
Canadian Tire To Acquire Workwear Brand
Canadian Tire Corporation (CTC) plans to purchase the company, controlled by the Ontario Teachers' Pension Plan, which owns and operates the Helly Hansen brands and related businesses. Helly Hansen is a global brand in sportswear and workwear based in Oslo, Norway. Outdoor and workwear categories are core to CTC's retail banners and, through Mark's and FGL, the company has had a long history with Helly Hansen as one of its largest customers. This acquisition strengthens CTC's core businesses across multiple banners, increases its brand offerings in Canada and its ability to grow its brands internationally.
Small Business Not Utilizing Resources
Small business owners are not taking advantage of available resources to help their businesses innovate and grow, says a report by BMO Wealth Management. For example, 61 per cent of small businesses have not pursued governments grants to support innovation. Thirty-three per cent say this is because they do not want to incur debt, while 25 per cent say acquiring funding is too complicated. It found only 22 per cent were just afraid they would be declined. On top of that, the majority of Canadian small business owners (64 per cent) are not aware of the network of accelerators, incubators, and hubs that are available to help them innovate. This response was cited significantly more by women (74 per cent) than men (55 per cent). Of those that do implement innovation, meeting client needs was cited as the most important reason by 70 per cent. BMO recommends businesses join a support network because innovation works best when business owners with different opinions and backgrounds collaborate.
Lowe’s Canada To Sponsor Soccer Club
Lowe’s Canada has entered into a platinum partnership with Club de soccer Boucherville in Quebec for the 2018 and 2019 soccer seasons. As of the 2018 soccer season kickoff on May 11, the Lowe’s Canada logo will be featured on the jerseys of the local U7 to U21 teams as well as those of the senior competitive teams. Lowe’s Canada will also be present at the club’s two tournaments — La Classique and La Surboum — to meet the players and their families.
JELD-WEN Sees Growth
JELD-WEN Holding, Inc. had net revenues of $946.2 million for the first quarter of 2018, an increase of 11.6 per cent over net revenues of $847.9 million in the first quarter of 2017. Net income for the quarter was $40.3 million, an increase of $33.8 million compared to net income of $6.4 million in the same quarter last year. Adjusted net income was $33 million. Adjusted EBITDA was $87.8 million, an increase of 8.5 per cent over adjusted EBITDA of $81 million in the year-ago period. Earnings margins decreased 20 basis points year-over-year to 9.3 per cent from 9.5 per cent last year. North America revenues increased 2.8 per cent year-over-year, partially due to the acquisition of MMI Door.
Strong Sales For Foundation Building Materials
Foundation Building Materials, Inc. had consolidated net sales of $536.3 million for the first quarter of 2018, an increase of 11.9 per cent over consolidated net sales of $479.5 million in the first quarter of 2017. Consolidated gross profit for the quarter was $154.4 million compared to $139.9 million a year ago, representing an increase of 10.4 per cent. Consolidated gross margin was 28.8 per cent compared to 29.2 per cent last year. Net loss was $1.1 million, a decrease of $5 million compared to net income of $3.9 million in the year-ago period. Adjusted EBITDA was $35 million and adjusted EBITDA margin was 6.5 per cent for the quarter.
May 11, 2018
Canadian Tire Has Continued Momentum
Canadian Tire Corporation, Limited consolidated retail sales increased $164.4 million or 6.4 per cent in the first quarter of 2018. Excluding petroleum, consolidated retail sales were up 5.1 per cent over the same period last year. Consolidated revenue increased $93.5 million, or 3.4 per cent; excluding petroleum, consolidated revenue increased $42.4 million, or 1.8 per cent in the quarter. The retail segment revenue increased 2.8 per cent for the quarter; excluding petroleum, retail segment revenue increased 0.8 per cent. The retail margin rate, excluding petroleum, increased 74 bps. Income before income taxes decreased $21.4 million or 48.1 per cent. Retail sales increased six per cent and same-store sales were up 5.8 per cent.
Fourth Quarter Building Materials Margins Strong
The Retail Services Price Index (RSPI) increased 0.3 per cent in the fourth quarter. The growth was a result of higher margins at general merchandise stores, gasoline stations, and building material and garden equipment and supplies dealers, says Statistics Canada. Margins were up in six of the 10 major retail subsectors, representing 53 per cent of the retail sector surveyed. Retailers at building material and garden equipment and supplies dealers posted margin gains of 1.7 per cent. The growth was concentrated in home centres. Margins in this industry have increased more than 30 per cent since the first quarter of 2012. The RSPI increased two per cent in the fourth quarter compared with the same quarter in 2016, with retailers in eight of the 10 major retail subsectors posting gains.
Lowe’s Canada Opens 23rd Reno-Depot Store
Lowe’s Canada opened its 23rd Reno-Depot store in Canada in Charlemagne, QC. This former L’Entrepôt RONA converted to the Reno-Depot banner and is the result of an investment in excess of $3.7 million. The store underwent a major 12-week transformation which involved redesigning all departments, installing new racking, adding enhanced offerings, and implementing the branding conversion. This is the second Reno-Depot store to open under the company’s improved model. It includes the “essence of a conventional Reno-Depot store, the value-added RONA products and services that our local customers love, as well as new product categories, particularly in the appliances and seasonal departments,” says Guy Beaumier, executive vice-president, big box, at Lowe’s Canada. The approximately 160,000-square-foot store includes an 87,000-square-foot sales floor, a 36,000-square-foot indoor lumberyard with drive-through, a 25,000-square-foot garden centre, and a 17,000-square-foot outdoor lumberyard.
Nicholson and Cates To Distribute JELD-WEN Panels
Nicholson and Cates Limited has formed a distribution partnership with JELD-WEN to distribute Extira exterior panels in Ontario. Extira panels are specifically designed and manufactured for interior and exterior projects for high moisture environments. It is rot and termite resistant and is available unprimed and sanded both sides with no voids or resin pockets. The product can be used for virtually any non-structural paint-grade application including exterior millwork, door and window parts, signage, garage doors, and architectural components. Nicholson and Cates will inventory a wide variety of popular widths and sizes, with additional sizes available by special order. For information, call 1-800-263-6223
Arrow Fastener To Relaunch Brands
As part of Hangzhou GreatStar Industrial Company, Arrow Fastener will relaunch its Pony and Jorgensen adjustable clamping brands and Goldblatt tile, drywall, concrete, and masonry tools to the North American marketplace in mid-2018. GreatStar, based in Hangzhou, China, is one of the largest hand tool manufacturers in Asia. It manufactures products for DIY, professional, and industrial markets globally. Arrow’s New Jersey facility will become a primary distribution centre for Pony, Jorgensen, and Goldblatt products, in addition to the company’s current product line. Over the past 18 months, GreatStar has been recreating the Pony and Jorgensen products at its manufacturing centres in China. Of the original 500 SKUs, GreatStar is recreating the 200 top sellers. These are the products which will support the reintroduction of the brands.
Nova Scotia Home Dealer Receives Award
Mike Wilson, dealer-owner of Wilson’s Home Hardware Building Centre in Barrington Passage, NS, was awarded the ‘2018 Young Retailer of the Year Award’ by the North American Retail Hardware Association (NRHA). This national recognition program, now in its 22nd year, identifies and promotes the next generation of aspiring independent home improvement retailers and recognizes individual achievement in the industry by retailers 35 years of age or younger throughout the U.S. and Canada. Selected from different retail categories, honourees are chosen based on wide-ranging criteria such as career accomplishments, community involvement, ongoing education within the hardware industry and extracurricular activities. Wilson was one of the hardware industry’s eight award recipients and won under the category for annual sales over $2 million.
Prices Drive Norbord Earnings
Norbord Inc. had adjusted EBITDA of $170 million for the first quarter of 2018, an increase of 65 per cent versus $103 million in the first quarter of 2017. The company says the improvement is primarily due to higher North American oriented strand board (OSB) prices and shipment volumes, as well as higher European panel prices. North American operations generated adjusted EBITDA of $156 million compared to $102 million. Adjusted earnings were $96 million in the quarter versus $50 million in the year-ago period. The company notes that the western Canadian OSB benchmark price increased 41 per cent through the first quarter of 2018 and finished the quarter on par with the North Central benchmark, demonstrating the tightness in that region as the spring building season commences.
Taiga Has Double Digit Sales Increase
Taiga Building Products Ltd. had sales of $324.6 million for the first quarter of 2018, an increase of 13 per cent over sales of $286.1 million in the first quarter of 2017. Gross margin dollars for the quarter increased to $30.8 million compared to $24.2 million last year. Net earnings were $6.8 million, up from $200,000 in the same period last year. EBITDA was $11.5 million compared to $7.8 million.
May 10, 2018
Ontario To Revoke Holiday Pay Calculation Rule
The Ontario government will reverse an amendment on the calculation of public holiday pay, says a Blakes ‘Business Class’ bulletin. The Bill 148 amendment, which came into force in January, was highly criticized by employers as costly and confusing. For example, the Bill 148 calculation required the payment of a full day of pay to any part-time worker who worked just one day in the pay period preceding the holiday. If that part-time worker had two part-time jobs and worked one day at each job in the preceding pay period, he or she would receive two days of pay for one public holiday. Ontario Regulation 375/18 will revert to the prior calculation for public holiday pay in Ontario for provincially regulated employers. In other words, public holiday pay will be calculated as the total amount of regular wages earned and vacation pay payable to the employee in the four work weeks before the work week in which the public holiday occurred, divided by 20. This regulation does not come into force until July 1, however. The current rules will apply to the Victoria Day weekend.
Building Permits Back Up
The value of building permits issued by Canadian municipalities increased 3.1 per cent to $8.4 billion in March, following a 2.8 per cent decline in February, says Statistics Canada. The rise was mainly the result of higher construction intentions for multi-family dwellings, particularly in Quebec and British Columbia and, to a lesser extent, by the commercial component. Municipalities issued $5.4 billion worth of residential building permits for the month, up 2.3 per cent from February. A notable increase in the multi-family component more than offset lower construction intentions for single-family dwellings. Although eight provinces reported declines in the residential sector in March, higher construction intentions in Quebec ($373.8 million) and British Columbia ($179.5 million) raised the national total. Conversely, single-family construction intentions fell 7.9 per cent to $2.4 billion in March, with Ontario posting the largest decline (13.7 per cent or $153.1 million). The value of building permits for non-residential structures rose 4.5 per cent to $3 billion in March, after a 6.4 per cent decline in February.
Castle Grows In Eastern Ontario
North Dundas Building Supplies has joined Castle Building Centres Group Ltd. The store, located midway between Ottawa and Morrisburg, ON, will serve the lumber and building material needs of the surrounding communities including Chesterville and Winchester. The retailer will offer a full line of lumber and building material products. New owners David Nyentap and Stacy Duguay, from Russell, ON, recently purchased this former lumberyard location and are looking forward to returning it to its original retail roots and adding a new storefront design.
JELD-WEN Canada Wins Energy Award
For the third time in three years, JELD-WEN Canada has been recognized as the ENERGY STAR ‘Manufacturer of the Year’ for the window and door category. It has earned the award because the unique, climate-based challenges that are seen from coast-to-coast in this country demand windows and doors of a certain standard and through relentless research and development, as well as a focused product improvement and JELD-WEN continues to design and manufacture products for this environment. ENERGY STAR is a voluntary Canadian initiative designed to help consumers identify which products are the most energy efficient
SANIFLO Celebrates 30 Years In Canada
SANIFLO Canada, a division of Group SFA, is celebrating its 30th year in Canada and 60 years in business. Since its inception in 1958, Group SFA, the parent company of SANIFLO, has been expanding its offering of plumbing solutions. The company started with manufacturing macerator and grinder toilet systems. Today, SANIFLO offers a wide range of macerators, grinders, drain-water pumps, and condensate pumps for both residential and commercial applications.
Poul Has New Role
Mojdeh Poul is vice-president, safety and graphics business group, with 3M, effective July 1. She is currently president and general manager, 3M Canada Company. She replaces Frank Little, who is retiring.
Sales Climb For LP
Louisiana-Pacific Corporation (LP) had sales of $691 million for the first quarter of 2018, a 13 per cent increase over sales of $611 million in the first quarter of 2017. Income from continuing operations was $95 million for the quarter compared to $55 million in the year-ago period. Adjusted income from continuing operations was $93 million and adjusted EBITDA from continuing operations was $159 million compared to $114 million last year. The siding segment had net sales of $227 million for the quarter compared to $214 million. The oriented strand board (OSB) segment had net sales of $313 million compared to $268 million a year ago. The engineered wood products segment (EWP) had net sales of $101 million versus $82 million.
Boise Cascade Income Rises
Boise Cascade Company had net income of $37.1 million for the first quarter of 2018, an increase of 270 per cent over net income of $10 million in the first quarter of 2017. Sales for the quarter were $1.2 billion, up 21 per cent over sales of $974 million in the year-ago period. Adjusted EBITDA for the quarter was $73.4 million compared to $40.5 million last year. The wood products segment had sales of $398 million, up 22 per cent over sales of $326 million. EBITDA for the segment was up 94 per cent. The building materials distribution segment had sales of $992 million, up 22 per cent over sales of $816 million. EBITDA for the segment was up 54 per cent.