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News

February 27, 2020

Busy January In GTA New Home Market

The Greater Toronto, ON, Area (GTA) new home market saw a busier than usual January, says the Building Industry and Land Development Association (BILD). There were 2,106 total new home sales in January, which was up 65 per cent from January 2019 and 14 per cent above the 10-year average. January new home sales included 1,100 condominium apartments, stacked townhouses, and loft units, up 33 per cent from January 2019 and 12 per cent above the 10-year average. Sales of single-family homes, with 1,006 units sold, were up 126 per cent from January 2019 and 16 per cent above the 10-year average. “The momentum that we saw building in the GTA new home market as 2019 progressed has carried over into early 2020,” says Patricia Arsenault, executive vice-president, data solutions at Altus Group. “Both end-user buyers and investors are showing more confidence than a year ago, which suggests 2020 will be another solid year for new home sales.”


Labour Shortage Still Affecting Private Sector Firms

Canada's private sector continued to face a record-high job vacancy rate of 3.2 per cent for the sixth consecutive quarter, says the Canadian Federation of Independent Business (CFIB) in its ‘Help Wanted’ report. In total, 434,000 private sector jobs sat vacant for at least four months in the fourth quarter of 2019 – 2,400 more than the third quarter of 2019 and 9,000 more than a year ago. Quebec (4.1 per cent) and British Columbia (3.6 per cent) continued the trend of posting the highest vacancy rates in the country. Ontario maintained its 3.2 per cent vacancy rate along the national average and New Brunswick came in just under at three per cent. Nova Scotia (2.5 per cent) and Newfoundland and Labrador (2.4 per cent) were the only provinces to post increases, gaining 0.1 per cent each over last quarter. Vacancy rates in Manitoba (2.4 per cent), Saskatchewan (2.2 per cent), Alberta (2.1 per cent). and Prince Edward Island (1.9 per cent) did not change and remained below the national average.


NRF Forecasts Strong 2020 Retail Sales

U.S. retail sales are forecast to increase between 3.5 and 4.1 per cent to more than $3.9 trillion in 2020, despite uncertainty from the lingering trade war, coronavirus, and the presidential election, says the National Retail Federation (NRF). “The nation’s record-long economic expansion is continuing, and consumers remain the drivers of that expansion,” says Matthew Shay, president and CEO of NRF. “With gains in household income and wealth, lower interest rates, and strong consumer confidence, we expect another healthy year ahead. There are always wild cards we cannot control like coronavirus and a politically charged election year. But when it comes to the fundamentals, our economy is sound and consumers continue to lead the way.” Preliminary results show that retail sales during 2019 grew 3.7 per cent over 2018 to $3.79 trillion. The numbers include online and other non-store sales and exclude automobile dealers, gasoline stations, and restaurants.


Fencing Market Forecast To Grow 5.3 Per Cent Per Year

The global fencing market is expected to reach more than US$40,730 million by 2026 with a compound annual growth rate (CAGR) of 5.3 per cent during the forecast period, says a study by Polaris Market Research. North America is anticipated to be the significant contributor during the forecast period. An evolving construction industry, an increase in disposable income, and the renovation of residential buildings are expected to drive the market during the period. Other driving factors include the development of public infrastructure and growing safety concerns. The evolving trend of design and aesthetics continues to contribute positively to market growth. The main materials for manufacturing fences are metal, plastic, wood, and concrete. In 2017, the metal fencing segment was the major contributor. However, the comparatively lower cost of plastic fences is expected to give them an advantage over other fencing materials. They are also lightweight and can be easily installed without any professional assistance.


Taiga Founding Member Passes Away

Founding member of what has become Taiga Building Products Ltd., Cam White, passed away February 21. White created the company with the help of several friends and built it into a successful business that also gave back to the community and the families of its employees. In a statement, Taiga says “Cam worked tirelessly to get the job done and impacted so many lives along his journey.” This contribution was recognized by the WRLA when he received the ‘Industry Achievement Award’ in 2002. White was CEO of Taiga from 2010 to 2015 and remained a director on the board since then.


Lowe’s Earnings Turn Around

Lowe's Companies, Inc. had net earnings of $509 million for the fourth quarter of 2019, an increase compared to a net loss of $824 million in the fourth quarter of 2018. Earnings included pre-tax operating costs and charges of $185 million related to the company’s strategic review of its Canadian operations and closure of its Mexico business. Sales for the quarter were $16 billion compared to $15.6 billion in the year-ago quarter and comparable sales increased 2.5 per cent. Comparable sales for the U.S. home improvement business increased 2.6 per cent year-over-year. Gross margin decreased 22 basis points to 31.08 per cent while adjusted gross margin increased 40 basis points to 31.89 per cent. Operating margin increased 961 basis points to 5.98 per cent while adjusted operating margin increased 70 basis points to 7.15 per cent year-over-year.


February 26, 2020

Building Construction Investment Edges Up

Total investment in building construction edged up 0.5 per cent from November to $15.6 billion in December, with gains in both the residential and non-residential sectors, says Statistics Canada. On a constant dollar basis, investment in building construction was largely unchanged at $12.8 billion. The total value of investment increased by 3.4 per cent to $181.8 billion from 2018 to 2019. Residential investment was up in five provinces in December, with notable gains in Ontario (+2.0 per cent to $4.5 billion) and Alberta (+3.2 per cent to $1.1 billion). Nationally, investment in multi-unit dwellings increased 2.8 per cent to $5.5 billion. Conversely, investment in single-unit dwellings decreased in every province except Alberta, leading to a national decline of 2.3 per cent to $5.1 billion. Non-residential investment rose in six provinces for the month, with notable growth in Quebec, Ontario, and Manitoba. Alberta declined for the sixth consecutive month, down 1.2 per cent to $695.5 million.


U.S. Construction Spend Strong

Levels of construction spending in the U.S. are healthy, in large part due to the ongoing strength in infrastructure-related categories, says the Marcum Commercial Construction Index. Non-residential construction spending stood at an annualized rate of $779.6 billion in December, down 1.2 per cent from the previous month but up 4.4 per cent year-over-year. “The ongoing strength in infrastructure-related spending is a result of state and local finances being at their healthiest levels in quite some time as consumer spending, ongoing staffing expansions, and elevated assessed values drive tax collections higher,” says Anirban Basu, author of the report and Marcum’s chief construction economist. He says inflated property values are a possible explanation for stagnation in privately funded segments. Issues affecting construction spend include labour shortages, trade-related uncertainty, the U.S. and China deal, rising levels of debt, heightened political uncertainty, and the potential effects of the coronavirus on world markets.


Cologne Hardware Show Reschedules Due To Coronavirus

‘EISENWARENMESSE, the International Hardware Show’ planned for March 1 to 4 in Cologne, Germany, has been postponed in response to the acute global situation around the coronavirus. The show managers at Koelnmesse say exhibitors have noted concern for the health of employees. “In view of these current developments and the high share of Asian exhibitors at the show, the management team at Koelnmesse has reassessed the current situation and set the new date in consultation with the industry,” they said. Some 3,000 exhibitors, including approximately 1,200 from China, had been expected to attend the biennial show. The show will now be held in February 2021. Registered exhibitors and visitors are being notified of the postponement.


Canac Opens 30th Store

Quebec independent hardware and building materials chain Canac Group will open its 30th branch on February 28 in Prevost, QC. The new store is part of the company’s $100 million growth plan announced in 2015, which included new stores, renovations and upgrades to existing stores, an expansion of its Drummondville, QC, distribution centre, and a shift toward automation. Going forward, the company hopes to open one or two stores per year, including an expansion into Ontario which is targeted for 2022 or 2023 in Hawkesbury, which is roughly midway between Montreal, QC, and Ottawa, ON.


Net Sales Down At Home Depot

The Home Depot had net sales of $25.8 million in the fourth quarter of its fiscal 2019 year, a decrease of 2.7 per cent over net sales of $26.5 million in the fourth quarter of its 2018 year. The decrease was due, in part, to less business days in the 2019 quarter compared to 2018. Comparable sales for the quarter were up 5.2 per cent year-over-year. Net earnings were $2.5 billion compared to net earnings of $2.3 billion, an increase of 5.8 per cent. Online sales were up 20.8 per cent year-over-year and more than 50 per cent of online orders were picked up in-store. For all channels, appliances, decor/storage, and tools had comparable sales that were above the company average.


February 25, 2020

Wholesale Sales Inch Up

Wholesale sales rose 0.9 per cent to $63.9 billion in December, following two consecutive monthly declines, says Statistics Canada. Four of seven subsectors recorded higher sales, accounting for 63 per cent of wholesale sales. In dollar terms, the motor vehicle and motor vehicle parts and accessories subsector led the increase. In volume terms, wholesale sales rose 0.8 per cent. Sales increased in five provinces in December, representing 76 per cent of total wholesale sales in Canada. In dollar terms, Ontario and Quebec accounted for most of the gain. Wholesale inventories were up 0.4 per cent to $92.2 billion for the month, the second consecutive monthly increase. Increases were recorded in four of seven subsectors, representing 45 per cent of total wholesale inventories. For the 2019 year, sales in the building material and supplies subsector declined 2.8 per cent to $107.5 billion. This was the first yearly decline since 2009 for this subsector. The top contributing industry to the decline was the lumber, millwork, hardware, and other building supplies industry (-5.6 per cent to $51.9 billion). Lower prices of lumber and other sawmill products have been contributing to lower sales in this industry.


Lowe's Canada Recruiting For Busy Season

In preparation for the home improvement industry's busiest season, Lowe's Canada is looking to fill more than 4,700 full- and part-time seasonal positions and 700 regular positions in its network of corporate stores this spring. To kick off its spring hiring campaign, the company is holding the third edition of its ‘National Hiring Day’ on March 14 in all its Lowe's, RONA, and Reno-Depot corporate stores across Canada. Available positions include administrative support associates, drivers, sales associates, receiving clerks, stockers, customer service associates, cashiers, and lumber yard clerks. Some independent dealers affiliated with the RONA banner will also take this opportunity to hold a hiring event on March 14.


Home Hardware Launches Scott McGillivray Flooring Collection

Home Hardware has partnered with Scott McGillivray, HGTV star and television host, to showcase his collection of advanced engineered hardwood, which will be available exclusively at Home Hardware, Home Building Centre, and Home Hardware Building Centre locations across Canada. The collection is available in six stain colours and features a floating click system.


Giant Tiger Expands Loyalty Program

Giant Tiger Stores Limited has expanded its loyalty program – GT VIP – to the Atlantic and Quebec markets. “We successfully launched to Ontario last fall and after seeing the exciting level of engagement, we are eager to offer this program to even more Canadian customers,” says Cindy-Lynn Steele, senior vice-president, corporate strategy and marketing. “Much like the launch in Ontario, we have chosen to launch in a rolled out approach to ensure that customers have the best possible experience.” Customers can download the program as a free app on both Android and iOS devices. Once they log in, they can search their GT VIP deals, browse the weekly flyer, and shop gianttiger.com. At the store, customers can scan the barcode or provide their phone number to activate the deals at checkout.


Trex Company Has Strong Sales

Trex Company, Inc, had consolidated net sales of $165 million for the fourth quarter of 2019, an 18 per cent increase over net sales of $140 million in the fourth quarter of 2018. Trex residential products net sales increased 25 per cent to $153 million and Trex commercial products net sales were $12 million. Gross margin for the quarter was up 40 basis points to 43.2 per cent, representing gross margins from Trex Residential and Trex Commercial of 44.6 per cent and 26.3 per cent, respectively. Net income was $35 million, up 41 per cent from net income of $25 million in the year-ago period.


February 24, 2020

Strong December Sales At Building Material Dealers

Retail sales were virtually unchanged at $51.6 billion in December, after growing 1.1 per cent in November, says Statistics Canada. Higher sales at building material and garden equipment and supplies dealers, as well as food and beverage stores were more than offset by lower sales at motor vehicle and parts dealers and gasoline stations. Building material and garden equipment and supplies dealers (+3.8 per cent) reported the largest sales increase in December and its largest monthly gain since June (+5.3 per cent). Sales were up in seven of 11 subsectors, representing 49 per cent of retail trade. Sales were up in eight provinces, led by Alberta (+1 per cent). Quebec had the largest monthly decline since November 2018 (-1.4 per cent). On an unadjusted basis, retail eCommerce sales were $2.6 billion in December, accounting for 4.7 per cent of total retail trade, the largest share on record. On a year-over-year basis, retail eCommerce increased 31.5 per cent, while total unadjusted retail sales rose 2.7 per cent.


Lowe’s Canada Employees Support Kids

Lowe’s Canada ended its 12th ‘Hair Massacure’ campaign with the unveiling of a cheque in the amount of $103,124 on February 21. The funds from this year’s annual campaign, which ran from January 20 to February 19 in the 33 RONA and Lowe's corporate stores in Alberta and at the Lowe's Canada distribution centre in Calgary, AB, will go to Children's Wish Foundation of Canada, an organization that provides children with life-threatening illnesses the opportunity to make a wish come true, and Terry Fox PROFYLE, a Canada-wide research project dedicated to finding new cancer treatments. Several employees of the Lowe's Canada network gathered at the West Edmonton Mall to celebrate the unveiling of the cheque and encourage their 21 colleagues participating in the ‘hair massacre,’ the highlight event of the campaign, during which numerous people shave their heads for donations. Since 2003, ‘Hair Massacure’ has raised over $12 million in support of organizations that help children with cancer or a life-threatening illness. Each year, hundreds of people in Alberta take part in the event. This year, roughly 120 employees from the Lowe’s Canada network dyed their hair pink for the cause, in addition to the 21 who participated in the ‘hair massacre.’


Longo Named Business Development Manager

John Longo is manager, business development, for the Ontario and Atlantic provinces with BMR Group. He has more than 25 years of experience in the construction and renovation industry.


Taiga Sales Down Two Per Cent

Taiga Building Products Ltd. Had net sales of $298.1 million for the fourth quarter of 2019, a decrease of two per cent over net sales of $303.9 million in the fourth quarter of 2018. The decrease was largely due to lower commodity prices. Gross margin for the quarter increased to $30.6 million from $24 million in same quarter last year. Net earnings were $5.8 million compared to $1.5 million in the year-ago period. EBITDA was $12.9 million versus $5.8 million.


UFP Industries Has Strong Quarter

UFP Industries (formerly Universal Forest Products, Inc.) had net sales of $998 million for the fourth quarter of 2019, an increase of one per cent over net sales of $988 million in the fourth quarter of 2018. The retail segment sales were up seven per cent year-over-year; the industrial segment sales were down four per cent; and the construction segment sales were up one per cent. Earnings from operations were $51.8 million, up 14 per cent over earnings from operations of $45.4 million in the year-ago quarter. EBITDA was up 12 per cent to $70.9 million. The company says profitability was the result of increased unit sales, leveraged fixed costs, and increased sales of higher-margin products, even though lower lumber prices reduced gross sales by five per cent.


February 21, 2020

Western Forest Employees Going Back To Work

Western Forest Products Inc. workers will soon be back on the job as those represented by United Steelworkers have voted in support of a tentative agreement. The new five-year collective agreement is effective from June 2019 and expires in June 2024. Roughly 3,000 employees have been on strike since July which affected the company’s manufacturing and timberlands operations in British Columbia. “We are focused on planning for a safe return to work and, while our goal is to begin operating as soon as possible, startup will be contingent on availability of employees and contractors, market demand, weather conditions, and sufficient log supply,” says Don Demens, president and chief executive officer.


Pier 1 Files For Bankruptcy, Pursuing Sale

Pier 1 Imports, Inc. has commenced voluntary Chapter 11 proceedings in the U.S. and bankruptcy proceedings in Canada in order to enter into a plan support agreement with a majority of its term loan lenders and pursue sale of the company. The company also intends to use this process to complete the previously announced closure of up to 450 store locations, which includes the closure of all its stores in Canada. To date, the retailer has closed or initiated going-out-business sales at over 400 locations. It is also in the process of closing two distribution centres to reflect its revised store footprint.


American Standard To Supply HGTV Shows

American Standard, part of the LIXIL Corporation, will become the official supplier of kitchen and bath plumbing fixtures for multiple television series on Corus Entertainment's HGTV Canada. The partnership adds to the current collaboration with contractor Kate Campbell, a long-time guest star on several HGTV Canada programs. Beyond product integration on both shows, the partnership will include digital and social activations. Audiences can tune in to HGTV Canada or check out HGTV.ca to see American Standard in featured episodes and resource guides.


Toughbuilt Launches Products On Zoro.com

Tool manufacturer ToughBuilt Industries, Inc. has launched 87 products on Zoro.com – 55 in the hand tool products category, 16 in gloves and safety, nine in the office supplies, and seven in power tools and accessories. Zoro.com, a subsidiary of W.W. Grainger, is an online seller of industrial supplies and business products that caters to the small- and mid-size contractor and do-it-yourself markets. Toughbuilt says the placement is a step in its continued expansion of online marketing.


Restructuring Impacts Masonite Income

Masonite International Corporation had net sales of $531 million for the fourth quarter of 2019, an increase of one per cent over net sales of $528 million in the fourth quarter of 2018. Net sales in the North American residential segment increased three per cent year-over-year and architectural net sales increased four per cent. Net income for the quarter was $2 million, down from $12 million in the year-ago period. Net income was impacted by restructuring plans and pension settlement charges. Adjusted EBITDA was $62 million compared to $58 million the previous year. Gross profit increased 16 per cent to $111 million year-over-year.


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