November 22, 2017
Sales And Earnings Up For Lowe’s
Lowe’s Companies, Inc. had net earnings of $872 million for the third quarter of 2017, an increase over net earnings of $379 million for the third quarter of 2016. Sales for the quarter rose 6.5 per cent to $16.8 billion from $15.7 billion in the year-ago period. Comparable sales increased 5.7 per cent year over year.
Manufacturing Sales Up In September
Manufacturing sales rose 0.5 per cent to $53.7 billion in September, reflecting higher sales in the petroleum and coal product industry, says Statistics Canada. Overall, sales were up in seven of 21 industries, representing 28.9 per cent of the Canadian manufacturing sector. Sales of non-durable goods rose 1.7 per cent to $25.4 billion, while sales of durable goods decreased 0.5 per cent to $28.4 billion. In constant dollars, sales increased 0.7 per cent, indicating that higher volumes of manufactured goods were sold in September. Sales rose in seven provinces in September, led by Quebec and New Brunswick. Inventory levels fell for the fourth consecutive month, down 0.7 per cent to $73.3 billion in September and the inventory-to-sales ratio fell from 1.38 in August to 1.36 in September. Unfilled orders declined 1.1 per cent to $85.1 billion in September. New orders decreased 1.7 per cent to $52.8 billion, following a 5.2 per cent gain in August.
Dartmouth Kent To Get New Home
J.D. Irving Ltd. plans to open a 124,000 square-foot Kent Building Supplies store at the Dartmouth Crossing in Dartmouth, NS. The store will replace an existing store in Dartmouth’s Mic Mac Mall. Construction started in September; a completion date has not yet been announced. The new location will be neighboured by a 380,000-square-foot IKEA anchor store. Kent Building Supplies is an Atlantic home improvement chain with 50 locations and eight truss plants across in New Brunswick, Nova Scotia, Newfoundland and Labrador, and Prince Edward Island.
Buyers Boost Confidence
U.S. home builders are seeing more buyers and that is boosting confidence. A monthly reading of home builder sentiment rose two points in November to 70, says the National Association of Home Builders (HAHB). This follows a hike of four points in October. Anything above 50 is considered positive sentiment. November's reading is the highest since March of this year and the second highest on record since before the recession. The index stood at 63 in November 2016. "Demand for housing is increasing at a consistent pace, driven by job and economic growth, rising homeownership rates and limited housing inventory," says Robert Dietz, NAHB’s chief economist. "With these economic fundamentals in place, we should see continued upward movement of the single-family housing market as we close out 2017." Builders are also benefiting from a new type of first-time buyer. Millennials have waited longer to become homeowners, meaning more first-time buyers are older and have had more time to save for a down payment. Some are skipping starter homes and going straight to a more expensive, new product.
PayPal Ordered To Hand Over Business Account Info
The Canada Revenue Agency (CRA) has ordered PayPal to hand over information about its business account holders. The CRA wants to see commercial account transactions that took place between 2014 and 2017. The order is to ensure that these businesses comply with tax obligations under the Income Tax Act and is part of the CRA’s crackdown on Canada’s underground economy. PayPal Canada has roughly 6.4 million active users, which include 250,000 active merchant customer accounts ‒ retailers of all sizes. PayPal says it has notified all affected account holders. In the past, eBay Canada and Square Canada have had similar orders to disclose information to the CRA.
Over 300K Visit China Lighting Fair
There were 301,000 visitors from 118 countries and regions, including 89,552 trade buyers, at the ‘20th China International Lighting Fair,’ held in November in Guzhen. This was a 7.1 per cent increase in attendance over last year. The event featured over 1.5 million square metres of exhibition space showcasing seven sub-venues with 2,000 exhibitors. Multiple professional conferences and forums were held during the fair, including the 'China International Lighting Design Awards,' a ‘China Association of Lighting Industry Council' session, and 'The 18th China Lighting Capital Summit.' The ‘21st China International Lighting Fair’ will take place March 18 to 21 at the Guzhen Convention and Exhibition Center, in Zhongshan, Guangdong. For more information, click here
Hicks Leads Canadian Tire Retail
Greg Hicks is president of Canadian Tire Retail at Canadian Tire Corporation. Previously, he was senior vice-president of merchandising for Canadian Tire Retail. He joined the company in 2013. Allan MacDonald is executive vice-president, retail. His previous roles include president, Canadian Tire Retail and chief marketing officer. He joined the company in 2009. Paul Draffin is senior vice-president, sourcing and procurement. Previously, he was vice-president, global sourcing and procurement. He joined the company in 2014.
HGTV Stars Will Speak At Renovation Show
HGTV Canada’s Sarah Richardson and Danielle Bryk are two of the speakers that will appear on the main stage at the ‘2018 Calgary Renovation Show.’ Visitors can shop, visit exhibitors, and learn about interior design and home improvements. It takes place January 12 to 14 at the BMO Centre in Stampede Park, in Calgary, AB. For more information, visit www.calgaryrenovationshow.com
DowDuPont Has Strong Sales
DowDuPont had net sales of $15.4 billion for the third quarter of 2017, an increase of 23 per cent over net sales in the third quarter of 2016. Pro forma net sales increased eight per cent to $18.3 billion for the quarter. Net income for the quarter was $514 million, down 29 per cent over net income of $719 million a year ago. Performance materials and coatings had pro forma net sales of $2.2 billion, up from $2 billion in the year-ago period. Industrial intermediates and infrastructure had pro forma net sales of $3.2 billion, up from $2.8 billion in last year’s quarter. The safety and construction segment had pro forma net sales of $1.3 billion, up from $1.2 billion in a year ago.
November 20, 2017
Online Boosts Walmart
A surging online business and strong food sales boosted Walmart's results. eCommerce sales grew 50 per cent with U.S. to about $11.5 billion this year and it expects global eCommerce to be $17.5 billion. However, that's still less than four per cent of overall sales. Overall, it posted quarterly revenue of $123.18 billion. Sales at stores open at least a year rose 2.7 per cent for the U.S. division, the biggest gain since the first quarter of 2009. Customer counts rose 1.5 per cent and Walmart says shoppers added one extra item to their cart, which helped boost sales. It earned $1.75 billion in the third quarter.
Cash Still Preferred
Despite the growth in alternatives such as debit and credit cards, Canadians still use cash to process more than half of all transactions, says the Bank of Canada. Overall, while debt and credit cards are becoming more popular ‒ especially for larger purchases ‒ cash is used to pay for more overall. Across all types of merchants, 51 per cent of all transactions were conducted in cash in 2015. That compares with 31 per cent for debit and 19 per cent for credit cards. "We find that cash is still widely used, especially for small-value transactions, even at large businesses that accept cash and cards," the bank says. "Debit cards are used mainly for medium-value transactions and credit cards for large-value transactions." In terms of the overall dollar value, credit cards tend to be the payment option of choice. A little under a quarter of the total value of sales in Canada in 2015 involved cash. A little more than a third of the time, debit payments were used, and credit cards were used the rest of the time (42 per cent). However, Canadian merchants spent almost $10 billion in costs related to processing fees in 2014 and almost two-thirds of that came from credit cards, some of which have one or even two per cent surcharges from the card providers. The average credit card transaction cost a merchant $2.08 to process, the bank says. That compares with a per transaction cost of 30 cents for debit cards and 29 cents for cash. Across all merchants, the average cash transaction was $8.04 in 2015. For debit, the average jumped to $28.33 and for credit, it was up to $43.85 per swipe.
Government Promises Huge Setback For Small Business
The publicly promised and long awaited ‘offsets’ promised by the Ontario government over the last few months, following their announcement to increase the minimum wage in the province by 32 per cent – is instead a huge setback for small business in Ontario, says Gary Sands, senior vice-president of the Canadian Federation of Independent Grocers. In Ontario, 59.7 per cent of all grocery stores are independent, employing approximately 25,000 and generating about $540 million in wages, salaries, and benefits. Sands says that this sector, which operates on margins of about 1.5 per cent, can have that margin eroded when a customer uses a credit card for payment, with a corresponding 1.5 per cent and higher interchange fee. That fee and other costs however, are fee invisible to the consumer and it seems, to the Ontario government. The dramatic hike in the minimum wage is also a trigger for increasing other expenses. When the payroll of a business increases, so too do other costs, such as the Employer Health Tax, WSIB, Employment Insurance, and the CPP. Sands says that this is probably why the NDP government in British Columbia decided to phase its $15 increase in over a longer time frame, being fully implemented in 2021.
Giant Tiger Opens Stores
Giant Tiger has opened stores in Canadian cities. In Mississauga, ON, it has opened a 27,100 square foot store in the Westdale Mall. In Winnipeg, MB, the new store is 19,750 square feet. It has also reopened a 24,650 square foot relocation of the store in Owen Sound, ON.
Amazon Introduces Alexa In Canada
Amazon has released Alexa in Canada, along with three Alexa-enabled devices: Echo, Echo Plus, and Echo Dot, which are voice-controlled speakers. Alexa can answer questions, play music, read the news, set timers and alarms, check the calendar, provide sports scores and results, control lights or temperatures at home, and much more. This release features an English voice with a Canadian accent, local knowledge, and local skills from Canadian developers. Over 10,000 skills will be available for customers in Canada this year, including skills from Air Canada, TD Bank, TELUS, CBC, the Bank of Montreal, Manulife, Aviva, Yellow Pages, and more. Alexa can be integrated directly into virtually any connected device, including devices that make up a smart home.
CanWel Revenues Increase
CanWel Building Materials Group Ltd.’s revenues increased by 14.7 per cent to $317 million for its third quarter ended September 30, compared to $276 million in the same period in 2016. The increase in revenues was mainly attributable to the company's continuing focus on its product mix strategies and target customer base and continued strengthening of U.S. housing markets, as well as the results of its completed acquisitions. The increase in revenues and overall financial performance was achieved despite sales in the forestry segment being negatively affected by the wildfires throughout British Columbia, with harvesting activities temporarily halted due to forest area closures, resulting in decreased harvest and customer delivery levels during part of the third quarter period. Net earnings before non-recurring items increased to $11.9 million during the third quarter of 2017, when compared to $7.5 million during the same period in 2016 an increase of 58.7 per cent.
November 17, 2017
Ontario Introduces Tax Cuts For Small Business
In order to ease the transition to increasing the minimum wage, Ontario will slash small business taxes and offer millions in incentives. The province’s fall economic statement shows the corporate tax rate for small businesses will fall from 4.5 per cent to 3.5 per cent effective January 1, the same day the province will increase minimum wage from $11.60 to $14. As part of the $500 million package for small business, the province will designate that one-third of its procurement spending on goods and services will come from small- and medium-sized businesses by 2020. The government will spend $124 million over three years to help companies with fewer than 100 employees who hire youths aged 15 to 29. The government will pay incentives of $1,000 for each worker hired and another $1,000 for each worker retained for at least six months by a small business. However, critics say these incentives will not ease the transition to the wage hike for small businesses. Business groups have argued that needed offsets for business should have comes months ago. Plamen Petkov, vice-president of the Canadian Federation of Independent Business, says the government's planned tax cut and incentives still fall short. The minimum wage hike “will put a crushing burden on Ontario's small businesses and their ability to remain competitive in a global market. As important as the initiatives announced today are, they won't offset the real impact of this legislation on Ontario's jobs and the economy.”
KPMG Unveils Customer Engagement Framework
KPMG International has unveiled a customer engagement framework designed to help businesses understand the increasingly complex and multi-dimensional forces that influence decision-making and preferences of consumers. The inaugural ‘Me, My Life, My Wallet,’ is a global analysis of how the seismic influences of socio-political and economic shifts, accelerated mass adoption of new technologies, and mobility are upending fundamental beliefs around what drives consumer behaviour. With findings from a survey of 10,000 people across the U.S., UK, India, and China, the report incorporates human-centered design thinking for business model innovation. Based on what KPMG calls the Five Mys, Customer Wallet, and Generational Surfing, the framework goes deeper than just the analysis of data through a single lens. From Millennials to Baby Boomers, it aids in assessing the drivers of consumer decision-making by looking at the multiple factors that influence people's everyday lives. Together, the three dimensions of the model – behavioural, financial, and demographic ‒ help deliver a more comprehensive, 360-degree view of a consumer.
Simpson Strong-Tie Launches Blog
Simpson Strong-Tie has launched a blog for construction professionals. ‘The Building Strong’ blog is an industry resource that aims to provide insights and fresh perspectives to help construction professionals design and build safer, stronger structures as efficiently as possible. The company developed the blog to discuss issues of special interest or importance to building professionals and will cover topics from rising labour costs, proper installation methods, and new design technologies to unique viewpoints on the changing landscape of the building industry. “For more than 60 years, we’ve listened to our customers throughout our product development process – either through our sales teams or by answering customer-service questions – and now we can communicate with them in a new way through our blog,” says Shelby Lentz, director of communications.
ecobee Opens Toronto Headquarters
ecobee Inc. has opened a head office in Toronto, ON. The company, which was founded in Canada, is the manufacturer of the ecobee smart Wi-Fi thermostat. The 37,000-square-foot facility was designed by Ray Inc. to foster creativity and innovation for a rapidly growing workforce that doubled in the last year to almost 200 people. Last year, the company launched its ecoboee4 in the U.S., a smart thermostat that runs with Amazon Alexa.
Bruno Leads Derby
Ralph Bruno is chief executive of Derby Building Products Inc. (formerly Novik Inc.), the international manufacturer of the Tando and Novik brands of exterior cladding products. Previously, Bruno was national sales manager of Trex Company in the early ’90s before starting AZEK Building Products in 2000, where he served as president until 2009.
Newell Brands Sales Decline
Newell Brands Inc. had net sales of $3.7 billion in the third quarter of 2017, a decrease of seven per cent compared to net sales in the third quarter of 2016. Gross margin was 34.5 per cent for the quarter versus 32.2 per cent in the prior-year period. Operating income was $323 million, or 8.8 per cent of sales, compared to $324 million, or 8.2 per cent of sales a year ago. Net income was $234 million, compared to $187 million. The company had weak sales in appliances and cookware while the work segment had a sales increase of 1.6 per cent.
Taiga Has Sales Increase
Taiga Building Products Ltd. had sales of $396.6 million for the second quarter of 2017, an increase of 18 per cent over sales of $335.1 million in the second quarter of 2016. Gross margin dollars for the quarter increased to $37.8 million compared to $29.5 million in the same quarter last year. Gross margin percentage was 9.5 per cent compared to 8.8 per cent a year ago. Net earnings were $6 million, an increase from $3.1 million in the year-ago period. EBITDA was $16.2 million compared to $11.3 million.
November 16, 2017
Canada Will Challenge To Stop Duties
The Canadian government says it will challenge the North American Free Trade Agreement (NAFTA) in its bid to stop U.S. duties on Canadian softwood lumber. Canadian softwood lumber producers have already laid down about $500 million in countervailing and anti-dumping duties since the U.S. Department of Commerce ruled last spring that Canada was unfairly subsidizing its softwood industry and selling wood into the U.S. at unfairly low rates. The main issues stem from the fact that most Canadian softwood is on Crown land and producers pay stumpage fees, set by provincial governments, for the right to harvest the wood. The U.S. Lumber Coalition alleges these fees are deliberately set too low and represent an unfair subsidy to Canadian producers. Canada vigorously denies these claims and has won several NAFTA challenges over similar softwood issues in the past. The government says it will even go to the WTO, if necessary.
Home Sales Increase Modestly
National home sales had a modest monthly increase in October, but remain below levels recorded one year ago, says the Canadian Real Estate Association (CREA). Home sales edged up 0.9 per cent in October on the heels of monthly increases in August and September, but remained almost 11 per cent below the record set in March. Activity was up from the previous month in about half of all local markets, led by the Greater Toronto Area (GTA) in Ontario and the Fraser Valley in British Columbia, together with a number of housing markets in the Greater Golden Horseshoe region in Ontario. Actual (not seasonally adjusted) activity was down 4.3 per cent, extending year-over-year declines to seven consecutive months. Sales were down from year-ago levels in slightly more than half of all local markets, led overwhelmingly by the GTA and nearby cities. The number of newly-listed homes eased by 0.8 per cent following a jump of more than five per cent in September. With sales up slightly and new listings having eased, the national sales-to-new listings ratio rose to 56.7 per cent in October from 55.7 per cent in September.
Nationwide Retailers Receive Recognition
Alex Yakovyshenko, general manager of TIMBER MART member Haney Builders Supplies in Maple Ridge, BC, was presented with the ‘2017 Outstanding Retailer Award’ (ORA) for young retailer. He was recognized for his leadership skills and management ability shown at a young age. Lowe’s Barrie (ON) received the ORA for best large surface retailer and Ace Matériaux Armand Dumaresq (QC) received the ORA for best building supply/home centre under 15,000 square feet. RONA Penticton (BC) was awarded the ORA for contractor specialist. Gow’s Home Hardwater in Bridgewater, NS, was honoured with best hardware store ORA and Sayer Home Hardware in Hagersville, ON, received the ORA for Marc Robichaud community leader.
Amazon Marketing Services Available For Canadian Brands
Amazon has launched marketing services for Canadian brands, offering a suite of pay-per-click performance advertising products available via a self-service portal. Sponsored products, headline search, and product display ads help brands increase customers' discovery of their products on the site based on relevant keyword searches, products, and shopper interests. Brands can also now create their own Amazon Store – a free, customizable, multipage shopping experience that showcases the brand and a curated product selection. Amazon introduced display advertising on its Canadian site in 2015. Its offering also spans advertising on websites both within and outside of Canada.
USG Acquiring Ceilings Plus
USG Corporation plans to acquire Ceilings Plus, a U.S. manufacturer of specialty ceilings products. The company says the addition will expand its product portfolio, accelerate innovation, and enhance its presence in the high-growth specialty ceilings market. “This acquisition will increase our penetration into architectural specifications and enable cross-selling opportunities for USG’s existing tile and grid ceiling products,” says Jennifer Scanlon, president and CEO of USG. The transaction is expected to close by the end of 2017.
Maybury Appointed Technology Officer
Dr. Mark has been appointed to the newly-created position of chief technology officer with Stanley Black & Decker. Previously, he held a variety of strategic technology leadership roles during his 27 years at the MITRE Corporation.
Sales Rise For Hardwoods
Hardwoods Distribution Inc. had revenue of $257.3 million for the third quarter of 2017, an increase of 9.3 per cent over revenues of $235.4 million in the third quarter in 2016. Organic third-quarter revenue increased 3.4 per cent, year-over-year. For the quarter, gross profit grew by 8.5 per cent to $47.6 million while gross profit margin was 18.5 per cent compared to 18.6 per cent in the same period in the prior year. Profit of $7.3 million was in line with results from the year-ago period. Sales in Canada were $34.5 million compared to $32.9 in 2016, while sales in the U.S. for the quarter were $177.5 million versus $155.2 million.
Acquisitions Drive Intertape Revenue
Intertape Polymer Group Inc. had revenue of $243.4 million in the second quarter of 2017, an increase of 17.9 per cent compared to revenue in the second quarter of 2016. The increase was partially due to additional revenue from the Cantech and Powerband acquisitions. Gross margin decreased to 20.9 per cent from 21.7 per cent for the quarter. Net earnings were $19.2 million, an increase of $13 million over net earnings in the year-ago period. Adjusted EBITDA for the second quarter was $32.4 million, an increase of 15.9 per cent year over year. Earnings were also impacted by the acquisitions.