July 4, 2019
Falling Work Volumes Affect Manufacturing
June data signalled another difficult month for the Canadian manufacturing sector, with falling volumes of new work contributing to the sharpest drop in production in 3½ years. More subdued economic conditions in both domestic and export markets, alongside a drag on sales from global trade frictions, were cited as drivers of the trend. At 49.2 in June, the seasonally adjusted ‘IHS Markit Canada Manufacturing Purchasing Managers' Index (PMI)’ picked up fractionally from May's 41-month low of 49.1. However, the latest reading was below the crucial 50 no-change value for the third month running, which marks the longest period of decline since 2015/16. A sharper reduction in production was the main factor weighing on the PMI. The downturn in output accelerated since the previous month and was the fastest since December 2015. Manufacturers generally cited a lack of new work to replace completed orders at their plants. Reflecting this, the latest survey revealed the steepest fall in backlogs of work since data collection began in October 2010.
PayPal Launches Real-time Payment Solution
PayPal has launched a feature that allows consumers and small businesses to instantly access funds. PayPal's Instant Transfer is powered by Visa Direct, Visa's real-time push payments solution. It moves money from customers' PayPal accounts to their bank account via their Visa debit cards. The consumer feature is now widely available and for small businesses it is currently available to an early access group of PayPal customers, with plans to be released across Canada in the coming months.
Conifex To Sell B.C. Sawmill
Conifex Timber Inc. intends to sell its Fort St. James, BC, sawmill and associated forest license to Hampton Lumber. The issue of insufficient saw log supply to maintain the existing manufacturing base in the interior region of British Columbia is one of the reasons for the sale. "We believe this transaction supports the province’s objectives for industry rationalization that is mindful of the impacts on people, communities, and First Nations," says Ken Shields, CEO of Conifex. Hampton Lumber operates nine sawmills in Oregon, Washington, and British Columbia, including two in the Burns Lake area of British Columbia.
Epicor Acquires Majure Data
Epicor Software Corporation, a global provider of industry-specific enterprise software, has acquired Majure Data, a provider of warehouse management solutions for the lumber and building materials (LBM) industry in the U.S. and Canada. Based in Georgia, Majure Data offers full integration tools for industry ERP platforms. Prior to completion of this acquisition, Epicor acted as a reseller for the Majure Data products RF Navigator and RF Navigator Foundations. The transaction closed on July 1.
Valickis Elected Vice-president
Tod Valickis, product manager at Schluter Systems, has been elected vice-president of the Tile, Terrazzo, and Marble Association of Canada (TTMAC). The TTMAC was founded in 1944 with a mandate to develop standards for terrazzo, tile, and marble installation methods and techniques, as well as being a technical resource and liaison for architects, specifiers, designers, and engineers. Valickis has been an elected member of the board of directors for the TTMAC for the past six years and has worked in the tile industry for more than 30 years. He joins Brent Fisher from Flesher Marble & Tile in Calgary, AB, who was elected president.
Strong Sales For GMS
North American interior building products distributor GMS Inc. had net sales of $780.1 million for the fourth quarter of its 2019 fiscal year, an increase of 22.7 per cent over net sales of $635.8 million in the fourth quarter of 2018. Organic net sales increased seven per cent year-over-year as a result of higher volumes and pricing improvement across all product groups. Net income for the quarter was $16.6 million compared to $9.9 million and adjusted net income was $28.7 million compared to $23.5 million. Adjusted EBITDA was $73.5 million, or 9.4 per cent of net sales, compared to adjusted EBITDA of $50.1 million, or 7.9 per cent of net sales, in the year-ago period. Sales for the wallboard division increased 15.1 per cent year-over-year; sales for the ceilings division increased 17.4 per cent; sales for the steel framing division increased 16.3 per cent; and sales for other products increased 44.4 per cent. Gross profit increased 24.8 per cent to; $256.9 million.
July 3, 2019
Lowe’s Chooses Charlotte For Technology Centre
Lowe's will open a global technology centre in Charlotte, NC, to accelerate its technology transformation and modernize its IT systems. The centre will feature 357,000 square feet of space staffed with up to 2,000 additional technology professionals. The tech centre will build on the company’s long-established presence in Charlotte where the retailer operates 21 stores. It plans to break ground in August with move-in scheduled for late 2021. In December, Lowe’s announced plans to invest more than $500 million annually through 2021 toward the company’s technology transformation. The company also maintains technology teams in existing strategic locations including Kirkland, WA; Bangalore, India; and Mooresville, NC.
Dollarama To Invest In Latin American Value Retailer
Dollarama Inc. plans to acquire a 50.1 per cent interest in Latin American value retailer Dollarcity. The transaction is expected to be immediately accretive to the company's earnings and establishes a second growth platform to complement its Canadian growth strategy. As at March 31, Dollarcity operated a total of 180 stores, with a growth plan to 2029 is to reach a target of up to 600 stores with the majority of store growth to be focused in Colombia. Dollarcity's growth target for the calendar year 2019 is 40 to 50 new stores. In the first quarter of 2019, Dollarcity had already opened 11 stores. The transaction is expected to close in August.
Tree Island Going Private
The Futura Corporation and Arbutus Distributors Ltd. have made an offer to take Tree Island Steel Ltd. private. The majority shareholders, who are controlled by company directors, Amar Doman (Futura) and Peter Bull (Arbutus), collectively own approximately 14.7 million shares, representing over 50 per cent of the issued and outstanding shares. They have proposed that the potential transaction be structured by way of a court-supervised statutory plan of arrangement which would require shareholder approval. An independent committee has been established to review the proposal. The majority shareholders believe the proposal would be in the best interest of the company and its shareholders for a number of reasons including providing immediate liquidity and certainty to the minority shareholders; offering fair value; resolving the issue of limited access to equity capital; and eliminating the significant administrative expenses incurred in maintaining a listing in Canada thus being able to redirect these funds into stabilization of the business.
Acuity Brands Has Increase
Acuity Brands, Inc., a lighting and building management solutions company, had net sales of $947.6 million for the third quarter of its fiscal 2019 year; this is an increase of 0.4 per cent from net sales of $944 million in the third quarter of 2018. Operating profit for the quarter was $120.3 million, an increase of 12 per cent over the year-ago period. Net income was $88.4 million, an increase of 21.1 per cent. Gross profit decreased 1.4 per cent to $383.6 million year-over-year while gross profit margin decreased 70 basis points to 40.5 per cent.
July 2, 2019
Home Depot Celebrates 40 Years
The Home Depot's founders rang in 40 years of success at the New York Stock Exchange on June 24 to commemorate the first store’s grand opening. CEO Craig Menear and co-founders Bernard Marcus, Arthur Blank, Pat Farrah, Ron Brill, and Ken Langone joined members of the leadership team from across the enterprise to celebrate on the trading floor. Home Depot opened its first stores in June 1979. The company went public in 1981 and began focusing on professional customers (contractors) in 1986. In 1994, it acquired Aikenhead to create the Canadian division. Today, it operates more than 2,200 stores primarily in the U.S., Canada, and Mexico. This includes 182 stores in Canada.
Stanley B&D Receives Comparably Awards
Stanley Black & Decker has received four Comparably Awards for 'Best CEO as rated by female employees,' 'Best CEO as rated by racially diverse employees,' 'Best Leadership Team,' and 'Best Company for Professional Development.' Stanley Black & Decker has various strategic initiatives in place to bring diversity and inclusion into its narrative. Thousands of employees are engaged in employee resource groups – cohorts to provide career advancement, engage in networking opportunities, and improve inclusion across the business. The company has also participated in the Business Roundtable Diversity & Inclusion Index, where the largest U.S.-based employers are committed to building a more inclusive environment. As well, Jim Loree, president and CEO, has signed on to the 'CEO Action for Diversity & Inclusion.' The awards are derived from sentiment ratings provided by employees who anonymously rate their employer throughout the year. Winners are determined based on a series of 50+ structured and comprehensive workplace questions in nearly 20 core culture categories.
Retail Sales Growth In Recovery Mode
Although hardly spectacular, retails sales had the highest gains in six months and things seem to be heading in the right direction as sales in all major retail sectors are showing the same kind of rebound, says Ed Strapagiel, a retail consultant. For the three months ending April, sales were up 2.8 per cent year-over-year. The trend continues to strengthen, but it has a way to go to return to previous highs. The 12-month trend also shows a slight improvement for the first time in over 12 months. But we're not out of the woods yet, says Strapagiel, as there was a similar upswing in retail sales growth in mid-2018 that never stuck. eCommerce sales represented about 3.1 per cent of retail sales for the three-month period ending April. eCommerce sales were up 18 per cent year-over-year.
West Fraser Impacted By Wildfire Logging Curtailments
West Fraser will temporarily suspend production for two weeks at its Alberta Plywood operations and High Prairie, AB, sawmill to address low log inventories for the facilities. Log inventories in support of these mills have been adversely impacted by wildfire-related logging curtailments compounded by recent wet weather. The decision to implement this temporary reduction provides time to build log inventories to more appropriate levels. Plywood production is anticipated to be reduced by approximately 13 million square feet, while the impact on Alberta lumber production is anticipated to be minor.
Wilson To Manage Hand Tools
Leeanne Wilson is merchandise manager of hand tools/sporting goods with Home Hardware Stores Limited. She has nearly 20 years of experience with the company including the role of merchandise associate, power tools and OPE.
June 28, 2019
2018 U.S. Home Improvement Spending Robust
2018 was a robust year for consumer spending on home services in the U.S., with the average total spend of $9,081 on home improvement, maintenance, and emergencies, says HomeAdvisor in its annual 'State of Home Spending Report.' Spending per household on home services was up 17 per cent in 2018 from 2017. Main contributing factors to this increase were the growing cultural focus on design aesthetics and quality of life and newer and better home improvement tools. The report says homeowners are spending more on home improvement projects than home maintenance projects. For every $1 spent on home maintenance, homeowners spent an average of $5 on home improvements. However, homeowners report completing an average of 6.7 home maintenance projects over the compared to 2.2 home improvement projects during the year. Room remodels were the most popular improvement project in 2018 with bathrooms topping the list for the second year in a row. Homeowners list replacing or repairing damage, defects, and decay as the number one reason for spending on home improvement projects. Looking forward, homeowners are prioritizing new appliances, roof replacements, and hardwood refinishing in addition to room remodels.
Technology To Drive Kitchen Faucets Market
Over the past few years, the plumbing business has flourished, which has encouraged growth in the global kitchen faucets market, says a report by Fortune Business Insights. The North American kitchen faucet market was worth US$2,011.6 million in 2017, with the global market estimated at $9,611.6 million. The global compound annual growth rate to 2025 is forecast at 6.3 per cent. Further growth will be spurred by consumer demand for advanced faucets with several traditional manufacturers planning to develop lines to meet this demand. Rapid digitization in kitchen faucets and the introduction of touchscreen kitchen faucets is expected to bode well for the market. The added advantages of hands-free faucets such as cost-effectiveness and energy savers are contributing to growth.
Atlas Engineered Products Partners With MiTek Canada
Atlas Engineered Products (AEP) has formed a strategic partnership with MiTek Canada, Inc. MiTek specializes in BIM (building information modeling) software, industrial equipment, facility management solutions, and building products for use throughout all parts of the building industry value-chain. "This partnership gives us access to cutting edge design and engineering technology, ensuring consistent quality standards at all our locations across Canada. Our designers will be able to collaborate and execute seamlessly using one shared technology platform," says Dirk Maritz, chief executive officer and president of AEP. "In addition, AEP's exclusive purchase of MiTek connector plates, building products, and services is expected to unlock significant value for our company via gains in operational efficiencies as well as economies of scale across all of our operations."
Peterson Named Interim CEO
Christopher Peterson has been appointed interim chief executive officer of Newell Brands. He will also continue his current role as executive vice-president, chief financial officer, which he has held since joining the company in 2018. The company is searching for a permanent CEO, and expects to announce an external hire in the upcoming weeks.