Serving Canada's Home Improvement Industry

Retailers, Wholesalers, and Manufacturers of Hardware, Building Supplies, Kitchen & Bath, Paint & Decorating, Lawn & Garden, and Other Allied Products.


March 1, 2019

Tax Relief Needed For Entrepreneurs To Scale Up

Governments need to consider policies that support both public and private equity markets and do not create an impediment to growth for Canadian companies become public,” says Pierre Lortie, author of the C.D. Howe Institute ‘Entrepreneurial Finance and Economic Growth: A Canadian Overview.’ The report shows that competitiveness of Canadian firms is being hampered by tax policies that discriminate against and penalize companies as they seek equity to fuel growth. It examines the dynamics of Canadian private and public equity capital markets and their efficiency in providing access to financing for innovative, high-growth small- and medium-sized enterprises. The report recommends adopting a tax measure similar to the ‘U.S. Small Business Jobs Act of 2010,’ which provides for full exemption from federal taxation of capital gains realized on the sale of shares of certain small businesses and reducing the capital gains tax on shares issued by qualified SMEs when they list on a Canadian stock exchange and are held by individual investors for a reasonable period of time.

Wholesale Sales Rise Slightly

Wholesale sales rose 0.3 per cent to $63.1 billion in December following a 1.1 per cent decline in November, says Statistics Canada. Sales were up in four of seven subsectors, representing about 64 per cent of total wholesale sales. The motor vehicle and parts and the miscellaneous subsectors led the gains. In volume terms, wholesale sales increased 0.3 per cent. In the fourth quarter, current dollar wholesale sales decreased 0.4 per cent, the first decline following 10 consecutive quarterly gains. Constant dollar sales decreased for the second consecutive quarter, down 0.9 per cent. Wholesale inventories were up 1.9 per cent in December, pushing the inventory-to-sales ratio to 1.43 ‒ the highest level since November 1995. Sales in the building material and supplies subsector increased 0.7 per cent to $9.1 billion, the first gain in three months. The lumber, millwork, hardware, and other building supplies industry reported the sole increase in December, 2.7 per cent.

Most Buying Decisions Made At Home

Eighty-eight per cent of buying decisions are discussed or made at home, says a study by PebblePost, a digital-to-direct mail marketing platform. The study, entitled ‘Home is at the Heart of Commerce Marketing,’ also shows 89 per cent of key purchase decisions are pre-planned and discussed with others. Spouses have the greatest influence on purchase decisions with 73 per cent of consumers saying that their spouse is influential in purchase decisions. When it comes to direct mail, 76 per cent of shoppers discuss relevant mail from a brand or retailer they have purchased from in the past, while 68 per cent of shoppers immediately toss direct mail received from a brand they haven’t heard of. Sixty-one per cent of recipients find direct mail influenced their purchase decision. With so many buying decisions made at home, PebblePost says this demonstrates the importance of direct mail in a shopper’s path to purchase. “The central role of the home, coupled with 90 per cent of intent data available online and 90 per cent of purchases occurring offline, means that marketers must align digital and traditional marketing strategies ‒ including direct mail ‒ to maximize ROI and drive conversions across every purchase channel,” says Lewis Gersh, CEO of PebblePost.

Partnership Helps Saint-Gobain Optimize Electricity Usage

Schneider Electric has extended its contract with building materials company Saint-Gobain, which builds on a 16-year partnership designed to optimize energy buying across sites in Canada, the U.S., and Mexico. To date, the program has helped Saint-Gobain trim energy expenses by more than $50 million. With the four-year extension, Saint-Gobain is adding more than 20 new properties to the portfolio that Schneider Electric analysts help manage, bringing the total to 144 sites. The analysts deliver a suite of procurement services that range from strategic sourcing and rate reviews to budgeting, and utility invoice collection and validation. In addition, all data for the program, including details on contracts and pricing, and site-level energy use, flows into Schneider Electric's EcoStruxure Resource Advisor, a cloud-based enterprise software platform. This gives Saint-Gobain a single source to track performance and savings and benchmark facilities in order to identify efficiency opportunities.

Newell Brands To Sell Rexair To Rhône

As part of its accelerated transformation plan, Newell Brands will sell its Rexair business to investment funds affiliated with Rhône Capital, a global private equity firm. Since 1936, Rexair has developed and manufactured Rainbow products designed to improve indoor environments. In 2018, net sales for the Rexair business were approximately $123 million.

Huebner Heads Jacuzzi

Charles Huebner is CEO of Jacuzzi Brands. Most recently, he was CEO of Dacor, Inc., which designs, manufactures, and markets kitchen appliances.

La Coop fédérée Has Record Sales

La Coop fédérée (La Coop) had consolidated sales of $6.5 billion for the year, up $244 million from fiscal 2017. The company says results are reflective of acquisitions, partnership agreements, and significant capital expenditures as well as strategic initiatives in line with its business model modernization. Earnings before patronage refunds and income taxes amounted to $210.7 million with equity and preferred shares totaling $1.5 billion and assets rising to $3.3 billion. All three operating segments – meat division, agri-business division, and retail division – contributed to the results. La Coop’s Gestion BMR Inc. segment includes BMR, Unimat, Agrizone, Potvin & Bouchard, La Shop, and Country Stores banners.

February 28, 2019

Lowe's Has Net Loss

Lowe's Companies, Inc. had a net loss of $824 million for the fourth quarter of 2018, a shift from net earnings of $554 million in the fourth quarter of 2017. Sales for the quarter were $15.6 billion compared to $15.5 billion in the fourth quarter of 2017, and comparable sales increased 1.7 per cent. Comparable sales for the U.S. home improvement business increased 2.4 per cent. Net sales were $15,647 million versus $15,494 million in the year ago period, while gross margin was $4,898 million versus $4,964 million. During the fourth quarter of 2018, the company recorded $952 million of goodwill impairment associated with its Canadian operations and also committed to exit its Orchard Supply Hardware operations, Alacrity Renovation Services, and Iris Smart Home in the U.S.

Investment In Building Construction Edges Up

Total investment in building construction edged up 0.2 per cent from November to $13.7 billion in December. Gains in the residential sector (0.6 per cent to $9.4 billion) were offset by declines in the non-residential sector (0.7 per cent to $4.3 billion), says Statistics Canada. On a constant dollar basis, investment in building construction also edged up 0.2 per cent to $11.6 billion. The slight increase in total residential investment for December was largely due to gains in Quebec ($24 million) and Nova Scotia ($18 million), which were partially offset by lower investment in Manitoba which was down $14 million. In the residential sector, investment in single-dwelling construction declined 0.6 per cent to $4.8 billion, while investment in multiple dwelling construction (which includes doubles, row homes, and apartments) increased 1.9 per cent to $4.6 billion. Compared with December 2017, investment in new construction decreased 4.8 per cent to $2.1 billion on an unadjusted basis and accounted for 46.9 per cent of all investment in non-residential building construction.

RIDGID Launches Annual Experience Contest

RIDGID is holding its ‘Experience’ contest for the third year in a row. RIDGID users can win one of six trips – held July 31 to August 2 – that includes a VIP tour of RIDGID headquarters, the opportunity to build their own custom pipe wrench, a photoshoot for an upcoming ad campaign, a one-on-one meeting with company managers, suite seats to see the Cleveland Indians, a fishing excursion on Lake Erie, and more.

Lifestyle Changes Drive Home Improvement Retailing Market

Lifestyle changes have raised interest in do-it-yourself (DIY) interior designing, creating a growing adoption of DIY home improvement products, says a report by ResearchAndMarkets. Moreover, in developing regions, the growing population of working women and their participation in the decision-making process for home decoration are also pushing the sales of products required for such projects. The report predicts that the global DIY home improvement retailing market will register a compound annual growth rate of close to four per cent by 2023. Other driving factors include the advent of eCommerce and pick-up and delivery opportunities. However, high complications in logistics and supply chain operations will affect the overall market.

Consumers Need Rat Prevention Products

Home improvement retailers in Toronto, Mississauga, Scarborough, Ottawa, and Sudbury, ON, need to stock their shelves with items to deter and exterminate rats and other rodents and pests. These cities were deemed the ‘rattiest’ cities in Ontario in 2018 by pest control provider Orkin Canada. Orkin says rodents need only a small hole to gain entry into a property, but preventative actions can be taken. For example, a rodent hole can be patched with just steel wool and caulking.

Maurer Named COO

Silke Maurer will be chief operating officer at BSH Hausgeräte GmbH, a Bosch Group company, effective March 1. As COO, she will be responsible for the areas of manufacturing, development, and innovation as well as for corporate technology and global supply chain management. She has been with the company since 2016.

February 27, 2019

Home Depot Sees Sales Increase

The Home Depot had sales of $26.5 billion for the fourth quarter of fiscal 2018, a 10.9 per cent increase from the fourth quarter of fiscal 2017. Comparable sales for the fourth quarter of fiscal 2018 were positive 3.2 per cent, and comp sales in the U.S. were positive 3.7 per cent. Net earnings for the fourth quarter of fiscal 2018 were $2.3 billion, compared with net earnings of $1.8 billion in the same period of fiscal 2017. Net earnings for the fourth quarter and the year were negatively impacted by a non-recurring, pre-tax charge of approximately $247 million, or $184 million after tax, due to an impairment loss related to certain trade names at Interline Brands.

Manufacturing Sales Decline For Third Month

Manufacturing sales declined for the third consecutive month, down 1.3 per cent to $56.4 billion in December on lower sales of petroleum and coal products. Excluding this industry, manufacturing sales declined 0.3 per cent, says Statistics Canada. Sales fell in 12 of 21 industries, representing 72.7 per cent of manufacturing sales. Manufacturing sales in volume terms were also down, declining 1.2 per cent in December. Unfilled orders rose 0.6 per cent to $97.3 billion, a third consecutive monthly increase. The unadjusted capacity utilization rate for the manufacturing sector decreased from 79.4 per cent in November to 75.9 per cent in December. Declines were widespread and may reflect to some extent regular seasonal variations. The capacity utilization rate for the non-metallic mineral product industry declined for the fourth consecutive month, falling 12.1 percentage points to 56.7 per cent in December. The decline was attributable to lower production in most non-metallic mineral product industries, particularly in the glass and glass product manufacturing and cement and concrete product manufacturing industries.

Consumers Want ‘Always On’ Ways To Pay

Today, more than ever, people are living an increasingly digital – and mobile – life and they expect their ability to pay for their needs and wants to match that same ‘always on’ mindset, says the 2019 edition of the ‘Mastercard Digital Payments Study.’ Mobile payments represented more the 27 per cent of the total social media conversation around payments, with total mentions increasing 20 per cent over the prior year. Mentions of mobile wallets specifically more than doubled since 2017. The report shows people are looking to newer technologies to have an impact on their lives as such mentions on social media increased 30 per cent since the last study. Today, nearly 20 per cent of all mobile commerce payments are focused on contactless payments and mobile wallets. Beyond these primary focus areas, consumers are interested in how artificial intelligence, QR payments, and wearable payments will impact their lives. Overall, people are increasingly positive toward these newer technologies. Virtually all (95 per cent) mobile wallet conversations were favourable, with 30 per cent of posts praising the speed, efficiency, and simplicity of the current products.

Enchante Lites To Acquire XanLite Branding

North American decorative lighting products manufacturer and distributor Enchante Lites LLC will acquire the distribution of Paris, France-based lighting company XanLite. XanLite’s unique ‘made in France’ designs and trends will be a part of the Enchante Lites portfolio, allowing the rebranded XanLite North America to extend its consumer products in Canada, the U.S., and Mexico.

DDC Launches Its Largest Delivery Drone

Drone Delivery Canada (DDC) launched its largest cargo and farthest range delivery drone, ‘The Condor.’ The unit has been in development for the past year and is the next generation in DDC's drone delivery cargo aircraft. It has a payload capacity of 180 kilograms or 400 pounds and a potential travel distance of up to 200 kilometres. It is powered by a next generation gas propulsion engine. The Condor measures 22 feet long, 5.1 feet wide, and seven feet tall. It has a wing span of approximately 20 feet and is capable of vertical take off and landing. It is equipped with DDC's proprietary FLYTE management system which is the same platform used in all of DDC's cargo delivery drones. This is also the same management system that was used in the fall of 2018, during the company's operations in Moosonee and Moose Factory, ON, in support of Transport Canada's ‘Beyond Visual Line-of-Sight (BVLOS)’ pilot project. DDC will be working closely with Transport Canada to secure the necessary approvals to begin flight testing the Condor in the third quarter of 2019.

Continental Sales Rise Seven Per Cent

Continental Building Products, Inc. had net sales of $140.8 million for the fourth quarter of 2018, an increase of 7.1 per cent over net sales of $131.4 million in the fourth quarter of 2017. Net income decreased 16.9 per cent to $20.1 million, while adjusted net income increased 32.5 per cent to $20.4 million compared to the year-ago period. EBITDA increased seven per cent to $39.8 million. Operating income was $29 million compared to $26.6 million in the prior-year quarter. Wallboard sales were flat for the quarter at 725 million square feet (MMSF).

February 26, 2019

LBM Sector Has First Sales Increase In Six Months

Retail sales edged down 0.1 per cent to $50.4 billion in December, says Statistics Canada. Excluding gasoline stations, retail sales increased 0.4 per cent. For the fourth quarter, retail sales declined 0.5 per cent, following a 0.7 per cent increase in the third quarter. In volume terms, retail sales were relatively unchanged in the fourth quarter. Sales at building material and garden equipment and supplies dealers rose 3.1 per cent, their first increase in six months. Following a 2.1 per cent gain in November, sales at electronics and appliance stores decreased four per cent in December. Sales were down in four provinces. On an unadjusted basis, retail eCommerce sales were $2 billion in December, accounting for 3.7 per cent of total retail trade. On a year-over-year basis, retail eCommerce increased 4.6 per cent in December, while total unadjusted retail sales decreased 0.4 per cent.

Home Renovation Professionals Cautiously Optimistic

U.S. professionals in the residential renovation and design industry have a positive outlook for 2019, finds the ‘2019 Houzz U.S. State of the Industry’ report. More than half of residential renovation and design companies cite a positive outlook for 2019 (58 to 80 per cent), although this is less than last year (71 to 88 per cent). The majority of companies expect profits to increase this year (63 to 70 per cent) and revenue growth in the upper single digits (eight to nine per cent). The report shows that while companies maintain a positive outlook on the demand for their services in 2019, they are more likely to expect the national economy to deteriorate over the coming year (35 to 61 per cent) than improve (11 to 18 per cent). In 2018, firms across sectors experienced widespread challenges in the rising costs of doing business, with the construction sector reporting the greatest impact (76 to 81 per cent). At least half of remodeling and design companies expect the costs of doing business to increase in 2019 (48 to 68 per cent).

Groupe BMR Invests In Maple Sugaring Company

Groupe BMR has become a minority shareholder of CDL, a company that develops, manufactures, and distributes equipment used in maple sugar production and maple product processing. “Maple sugaring is a fast-growing industry and we’re very pleased to strengthen our position in the sector,” says Pascal Houle, CEO of the Groupe BMR.

Minimalism, Calmness Trends In Design

Rustic luxury, pretty and calm, and minimal opulence are among the trends in design, says wood and composite moulding company Metrie in its ‘2019 Trend Report.’ Rustic luxury reflects a desire for a simpler time and is represented by fine craftsmanship, natural materials, and wide-open spaces. This trend embraces minimalism in the sense of being uncluttered and spacious rather than devoid of detail and includes natural woods, patinated metals, and an organic colour palette. Pretty and calm reflects traditional roles becoming genderless and shows up with blurred lines and a connection with Mother Earth. Material choices are smooth to the touch, colours are energizing yet soothing, and the lines of walls and furniture flow freely through the space. Minimal opulence is a resurgence of geometric patterns, deep colours, and unexpected details as a way to add back in a little luxury and warmth. The geometry keeps this trend contemporary, and there is a confidence that comes from strong lines and sharp angles ‒ confidence that draws out an air of sophistication in its visual symmetry.

Sewell Named COO

David B. Sewell will be president and chief operating officer at Sherwin Williams Company, effective March 1. He has served as the company’s president, performance coatings group, since 2014. He joined the company in 2007.

Decreased Demand Impacts Taiga Sales

Taiga Building Products Ltd. had consolidated net sales of $303.9 million for the fourth quarter of 2018, a decrease of eight per cent over consolidated net sales of $329.8 million in the fourth quarter of 2017. The company says the decline is due to decreased demand for its products in all segments and lower commodity prices. Gross margin for the quarter decreased to $24 million from $27.4 million over the same quarter last year. Gross margin percentage decreased to 7.9 per cent compared to 8.3 per cent. Net earnings were $1.5 million compared to a loss of $15.2 million.

Prices Affect Canfor Earnings

Canfor Corporation had an operating loss of $79.1 million for the fourth quarter of 2018, a decrease from operating income of $214.2 million in the fourth quarter of 2017. Sales for the quarter were $1,028.1 million compared to sales of $1,156 million in the year-ago period. Net loss was $52.4 million versus net sales of $131.8 million. The company had significantly higher unit log costs in western Canada along with log supply constraints and market conditions that resulted in the company curtailing production at its British Columbia operations by approximately 100 million board feet for the quarter. North American lumber consumption was also down slightly in the fourth quarter, in part reflecting waning demand as the quarter progressed.

February 25, 2019

Lumber And Prices Boost LBM Sales

Sales in the building material and supplies subsector increased for the ninth consecutive year, up 8.1 per cent to $111.2 billion in 2018, on the strength of higher sales in all industries, says Statistics Canada. The lumber, millwork, hardware, and other building supplies industry contributed the most to the gain, up 5.8 per cent to $55.2 billion and its seventh consecutive annual increase. Although this industry reported positive growth in 2018, it did not surpass the growth rate of 11.6 per cent reached in 2017. Related indicators, including the total value of residential and non-residential building permits, increased 3.6 per cent in 2018, after rising 10.9 per cent in 2017. The Industrial Product Price Index for lumber and other wood products rose for the fourth consecutive year, up 7.1 per cent in 2018 and its highest growth rate since 2004. Exports of building and packaging materials rose 5.2 per cent while imports were up 5.1 per cent from January to November 2018. Sales in the electrical, plumbing, heating, and air-conditioning equipment and supplies industry rose 9.4 per cent to $34.1 billion, the second consecutive gain. In volume terms, sales in the building material and supplies subsector edged up 0.3 per cent.

HBC To Close Home Outfitters

HBC will close its Home Outfitters business in Canada and is performing a fleet review of Saks OFF 5TH’s 133 stores, with an estimate of closing up to 20 locations in the U.S. These actions are part of the company’s strategic plan to reduce costs, simplify the business, and improve overall profitability. Home Outfitters is expected to close in 2019. The vast majority of markets in which it operates are served by Hudson’s Bay, which accepts Home Outfitters gift cards.

Parental Sharing Benefit Starts In March

The federal government of Canada’s Employment Insurance parental sharing benefit will launch March 17. This means soon-to-be parents will be eligible to receive extra weeks of parental benefits. The benefit will be available to parents, including adoptive or same-sex parents, for a child born or placed for the purpose of adoption on or after March 17 ‒ as long as they are eligible for and share their Employment Insurance parental benefits. When parents agree to do so, they will benefit from five additional weeks of parental benefits when choosing the standard option or eight additional weeks for those who choose the extended option. Corresponding changes to the Canada Labour Code will also be made to ensure that federally regulated private-sector employees have the right to take leave while receiving the new parental sharing benefits without fear of losing their job.

U.S. New Construction Starts Up Two Per Cent

The value of U.S. new construction starts in January advanced two per cent compared to December, reaching a seasonally adjusted annual rate of $722.5 billion, says Dodge Data & Analytics. The slight gain followed the loss of momentum that was reported towards the end of 2018, with total construction declines of seven per cent in November and 10 per cent in December. Each of the three main construction sectors in January registered modest growth. Residential building climbed four per cent, lifted by a rebound for multi-family housing. Both non-residential building and non-building construction edged up one per cent. On an unadjusted basis, total construction starts in January were $51.5 billion, down 12 per cent from the same month a year ago. On a 12-month moving total basis, total construction starts for the period ending January 2019 held steady with the corresponding amount for the 12 months ending January 2018. Residential building in January was $309.8 billion (annual rate), up four per cent and rebounding from its nine per cent slide in December. Multi-family housing bounced back 14 per cent following its 15 per cent December decline, and was up one per cent compared to its average monthly pace during 2018.

Report Shows Zero Carbon Buildings Financially Viable

The Canada Green Building Council (CaGBC) has issued a new report that shows Zero Carbon Buildings offer meaningful greenhouse gas reductions and positive financial returns. Entitled ‘Making The Case For Building To Zero Carbon,’ the CaGBC report confirms that Zero Carbon Buildings are financially viable today, with a positive financial return over a 25-year life-cycle, inclusive of carbon pollution pricing, and requiring only a modest capital cost premium. The economic case for Zero Carbon Buildings is reinforced over time with the rising cost of carbon, increased resiliency, and by avoiding costs such as future retrofits. Eliminating pollution from buildings is important if Canada is to meet its climate action goal of reducing greenhouse gas emissions by 30 per cent below 2005 levels by 2030. The CaGBC report found that, by 2030, over four million tonnes of carbon dioxide equivalent emissions per year can be avoided cost-effectively if the seven building types studied are built to be zero carbon buildings. This represents over 22 per cent of the 20 million tonnes of greenhouse gas reductions that the Pan-Canadian Framework recognizes as potential savings from the building sector.

Healthy Growth Forecast For Facade Market

The global facade market size is anticipated to reach US$342.94 billion by 2025, says a report by Grand View Research, Inc., exhibiting a compound annual growth rate of 7.6 per cent during the forecast period. The market is estimated to register healthy growth over the forecast period owing to development of advanced materials with capabilities that offer safety, performance, and visually appealing texture. This exterior building face carries the attribute of both appearance and superior performance in a mode, unlike any other building system, which is expected to fuel the demand for the product over the next few years. Soaring need to lower heating and air-conditioning cost and achieve energy-efficiency is slated to stir up the demand for facades over the coming years. As well, burgeoning popularity of green buildings and surging demand for high-transparency glasses that allow passage of light, while maintaining heat-resistance, are poised to shape the future of the market. The market is projected to witness the application for high-performance and energy-saving solar control facades, which will contribute towards higher economic benefits and eco-sustainability.

Hamburger Joins BMR Group

Jason Hamburger is business development manager in Ontario at BMR Group. This is a new position created to help the company’s development in Ontario. He brings more than 20 years of experience to the role, including a decade as product manager at Home Hardware Stores Limited.

UFPI Net Sales Rise Two Per Cent

Universal Forest Products, Inc. (UFPI) had net sales of $988.2 million for the fourth quarter of 2018, a two per cent increase over net sales in the fourth quarter of 2017. EBITDA was $63.6 million for the quarter, up more than 11 per cent over the prior-year period. Operating profit was $45.4 million, up 9.5 per cent. New product sales were $103 million, up 13 per cent year-over-year. Retail sales were down eight per cent year-over-year, while industrial sales were up 11 per cent. Construction sales were up one per cent over the year-ago period, with residential sales up seven per cent, and commercial sales up 18 per cent. Construction sales were offset by a decrease of three per cent in sales to manufactured housing customers.

Newell Brands Sales Slide

Newell Brands had net sales from continuing operations of $2.3 billion for the fourth quarter of 2018, a decline of six per cent compared to net sales from continuing operations of $2.5 billion. Core sales from continuing operations declined 1.2 per cent from the prior-year period. Operating margin was 0.8 per cent compared with 5.7 per cent, while normalized operating margin was 11.4 per cent compared to 10.7 per cent in the prior-year period. The company had gross margin of 34.7 per cent compared with 32.7 per cent a year ago. Net income for the quarter was $208 million versus $1.7 billion in the previous year. The food and appliances had a core sales decline of 1.7 per cent and the home and outdoor living segment had a core sales decline of three per cent.

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