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News

November 9, 2018

Canadian Tire Topline Growth Strong

Canadian Tire Corporation, Limited had strong topline growth in its retail businesses for third quarter ended September 29. It attributes the growth to, among other things, the success of its Triangle Rewards and the national rollout of deliver-to-home capabilities. Retail segment revenue increased $338.3 million, or 11.4 per cent. Excluding petroleum, retail segment revenue increased 10.6 per cent. Canadian Tire Retail saw retail sales increase 2.4 per cent and comparable sales were up 2.2 per cent. FGL retail sales were up 1.6 per cent and comparable sales were up 2.2 per cent. Mark's retail sales grew 6.4 per cent and comparable sales increased 6.1 per cent. Helly Hansen revenue in the third quarter was $181.7 million. This quarter's results reflect the inclusion of Helly Hansen's operations for the first time.


Housing Starts Decline In October

The trend in housing starts was 206,171 units in October 2018, compared to 207,809 units in September 2018, says Canada Mortgage and Housing Corporation (CMHC). "The national trend in housing starts declined for a fourth consecutive month in October, which leaves the trend at its lowest level since February 2017," says Bob Dugan, CMHC's chief economist. "However, despite declining for several months, the trend remains slightly above its long-run average because it follows historically elevated levels of activity in 2017."The standalone monthly SAAR of housing starts for all areas in Canada was 205,925 units in October, up from 189,730 units in September. The SAAR of urban starts increased by 8.6 per cent in October to 191,964 units. Multiple urban starts increased by 16.8 per cent to 145,442 units in October while single-detached urban starts decreased by 10.7 per cent to 46,522 units. Rural starts were estimated at a seasonally adjusted annual rate of 13,961 units.


Brands Want Better Use Of Data

With the retail landscape is changing at a blistering pace, it’s no wonder that 92 per cent of brands realize they could make better use of data, says a report from Askuity. Its ‘2019 POS Data Study’ shows the ability to get faster insights helps brands stay agile in an incredibly dynamic market. The rise of Amazon is forcing brands to pivot their strategy before they experience any losses. Brands who are still using human-error-prone spreadsheets are craving the efficiency that automation offers so they can spend less time managing data and more time analyzing it. Data-driven corporate cultures are supporting better, more profitable retail relationships that sell more. Brands that bring insights to buyer meetings more often are getting the attention of retail buyers who trust their data-backed suggestions. Those brands using less sophisticated tools for POS reporting are falling behind the competition, reporting lower forecasting abilities, lost shelf space, lower sales growth, and higher out of stock rates versus those who do. Brands that continue to use outdated tools are no longer merely at risk of falling behind the competition, they are already behind, it says. In three short years, brands have moved from warming up to the idea of using data in their daily operations to, in 2019, definitive proof that purpose-built POS analytics solutions are enabling sales teams to strengthen buyer relationships and effectively grow top line sales.


BMR Group Trade Show In Full Swing

Groupe BMR's '1028 Trade Show' kicked off November 8 and runs through today at the Quebec City Convention Centre in Quebec. More than 700 representatives from Groupe BMR dealers expected to meet roughly 330 exhibitors showcasing their products at the 75,000-square-foot-show. Features at this year's show include nine new categories of products and a dedicated space for learning about turnkey merchandising solutions that will be presented alongside special launch offers. As well, there is a pavilion dedicated to horticulture and agricultural products that houses several suppliers. The 2018 show also spotlights the group's digital shift and customer experience. The show will conclude with the 'BMR Gala' which will recognize dealers and suppliers who have excelled over the past year.


Scheltgen Handles Outside Sales

David Scheltgen is with the outside sales team at COAST DISTRIBUTORS (Nanaimo) LTD. His territory will be northern Vancouver Island in British Columbia. He has been working in the shipping/receiving department at the Nanaimo distribution centre for the last two years.


Newell Brands Sales Drop

Newell Brands had net sales from continuing operations of $2.3 billion for the third quarter of 2018, a decrease of 7.7 per cent from net sales from continuing operations of $2.5 billion in the third quarter of 2017. Core sales from continuing operations declined four per cent year-over-year. Operating margin was a negative 347 per cent for the quarter, reflecting an impairment charge, which more than offset significantly reduced restructuring and integration costs. Gross margin was 35.9 per cent compared with 35.1 per cent in the prior year. The company had a net loss of $7.1 billion compared with net income of $234 million in the prior year, with the decline primarily attributable to the total company impairment charge of $8.7 billion. Most segments had a slight decrease over the year-ago period.


November 8, 2018

Moderation Forecast In Housing Starts And Sales

Canada's housing markets should see a moderation in both housing starts and sales, says the '2018 Housing Market Outlook' by the Canada Mortgage and Housing Corporation (CMHC). Nationally, CMHC's outlook for 2019 projects total housing starts to edge down and range between 193,700 to 204,500 with the downward trend expected for both single and multi-unit starts. MLS sales are expected to be between 478,400 and 497,400 units annually. Housing starts activity and MLS Sales in British Columbia should moderate as economic and population growth slows. Meanwhile, buyers' market conditions in both Alberta and Saskatchewan should gradually shift to a balanced market with gradual improvement in economic and demographic fundamentals. In Ontario, the housing market saw dampened activity in 2018. Existing home sales and starts will post a partial recovery in 2019. In Quebec, housing starts and sales of existing homes will both be sustained, however, slower economic growth and rising borrowing costs will moderate activity through 2020. The Atlantic region will see sustained activity, notably in Nova Scotia, where existing home sales should trend higher while rental demand will drive growth in apartment construction.


Strong Growth Forecast For Interior Doors

A surge in residential and non-residential construction activities, a growing demand for energy-efficient and eco-friendly doors, a rise in home improvement and remodeling expenditures, and an increase in demand for recyclable raw materials are expected to boost the growth of the global interior doors market, says a report by Allied Market Research. The report shows the global interior doors market was pegged at $52.61 billion in 2017 and is expected to reach $85.41 billion by 2025, registering a compound annual growth rate (CAGR) of 6.3 per cent from 2018 to 2025. Among door types, the panel doors segment held the largest market share of 65 per cent in 2017, owing to the significant demand for panel doors among home owners and builders for their weatherproof attribute and low-maintenance cost. However, the bypass doors segment is expected to portray the fastest CAGR of 7.3 per cent during the forecast period. Among product types, the wood segment accounted for more than half of the market share in 2017 and would remain dominant through the forecast period.


Retail Sales In The Doldrums

Canadian retail sales keep stumbling along at a modest pace and the holiday sales season doesn't look too promising at this stage, says Ed Strapagiel, a retail consultant. For the three months ending August, total retail sales were up 3.7 per cent on a non-adjusted basis. This is about half the 7.1 per cent gain recorded for last year overall. The three-month growth trend continues to track below the underlying 12-month trend, which in turn has been on a consistent slide since the start of the year. Without gasoline stations, there is an even steeper slide in retail sales growth in 2018, he says. Overall, eCommerce represented about 2.8 per cent of total retail sales for the 12 months ending August 2018, including both pure play operators as well as the online operations of bricks-and-mortar stores. Canadian eCommerce sales were up 13.5 per cent year-over-year for the three months ending August, but this is much less than the 3.9 per cent gain recorded in the same period a year ago. eCommerce retail sales gains are still in double digits and are still much higher than for location based retail, but growth is slowing down.


FBM Sees Strong Sales

Foundation Building Materials, Inc. (FBM) had net sales of $542.3 million for the third quarter of 2018, an increase of 15.9 per cent over net sales of $467.9 million for the third quarter of 2017. Net sales from base business branches contributed $52.3 million, or 12.5 per cent, of the increase. Gross profit for the quarter was $154 million, an increase of 13.4 per cent compared to gross profit of $135.9 million for the year-ago period. Gross margin was 28.4 per cent versus 29 per cent. Net loss was $37.6 million compared to net income of $100,000. For the third quarter, adjusted EBITDA was $43.7 million and adjusted EBITDA margin was 8.1 per cent compared to adjusted EBITDA of $36.4 million and adjusted EBITDA margin of 7.8 per cent last year.


Resolute Has Strong Income

Resolute Forest Products Inc. had net income of $117 million for the third quarter of 2018, an increase compared to net income of $24 million for the third quarter in 2017. Sales were $974 million in the quarter, an increase of $89 million from the year-ago period. Consolidated operating income was $135 million compared to $121 million in the second quarter of 2018. Despite weaker lumber markets, overall results increased by $14 million, supported by higher pricing and improved productivity in its pulp and paper operations, says the company. Wood products operating income dropped $35 million to $45 million from the second to third quarter. EBITDA for the segment decreased to $53 million, compared to $86 million in the second quarter.


November 7, 2018

Quebec Leads Building Permit Issuance

Canadian municipalities issued $8.1 billion worth of building permits in September, up 0.4 per cent from August, says Statistics Canada. The national increase was driven by higher construction intentions in Quebec. In the residential sector, the value of building permits edged up 0.3 per cent to $4.9 billion, posting the first increase in four months. Higher construction intentions for multi-family dwellings contributed to the rise. In the multi-family dwelling component, the value of permits rose 1.5 per cent to $2.7 billion while the value for building permits for single-family dwellings was down 1.2 per cent to $2.2 billion in September, the fourth consecutive monthly decrease. Municipalities approved the construction of 19,073 new dwellings, up 7.8 per cent from August. The increase was attributable to both single-family (3.3 per cent) and multi-family (9.4 per cent) dwellings. The value of building permits in the non-residential sector was up 0.6 per cent to $3.1 billion in September, due to higher construction intentions for institutional buildings. In the institutional component, the value of building permits rose 16.4 per cent from August to $806 million. In the commercial component, $1.7 billion worth of permits were issued in September, down 3.3 per cent from the previous month. The value of building permits in the industrial component fell 5.7 per cent to $636 million. Five provinces reported declines, with the most significant decreases in Quebec and British Columbia.


IKEA Canada Launches One-year Return Policy

IKEA Canada has launched a 365-day return policy that allows returns for unused product up to one year after purchase. Products including home furnishings and accessories can be returned to the retailer, either in their original packaging or assembled, allowing customers to test and try at-home. The policy was first introduced in early fall and has now rolled out to all markets from coast-to-coast, including eCommerce. With proof of purchase, customers can return any product, even if it's assembled, as long as it's in unused resalable condition. The return policy covers all IKEA products including unexpired food, with no exceptions. Customers will be refunded with the same method as their original payment.


Service To Help SMBs Enter Digital Space

Webware.io has partnered with Staples Canada to enable small businesses and entrepreneurs to leverage the digital world to build their business. As part of the partnership, Webware will have staff onsite in Staples stores to educate and counsel business owners on how they can enter the digital space and market to a broader audience. Webware staff will be onsite in four Staples stores in the Greater Toronto, ON, Area, and, over the next 18 months, its in-store presence will roll out in many Staples locations across Canada. "For businesses to be successful online, they need more than a website. They need a robust online strategy that does not require a large investment of their time," says Cory York, founder and CEO Webware. "In the last three years, Webware has helped more than 10,000 small business owners enter and grow a successful online presence. Extending our expertise in-store at Staples will enable us to help even more business owners lever the digital space to take their business to a new level."


Lowe’s Appoints Godbole As CIO

Seemantini Godbole is chief information officer with Lowe’s Companies, Inc., effective November 12. She currently serves as senior vice-president, digital and marketing technology, at Target Corporation. She brings more than 25 years of experience to the role.


OSB Demand Drives Norbord Earnings

Norbord Inc. had adjusted EBITDA of $211 million for the third quarter of 2018, a six per cent increase versus $200 million in the third quarter of 2017. North American operations had adjusted EBITDA of $190 million compared to $184 million in the same quarter last year, while European operations delivered adjusted EBITDA of $23 million versus $14 million. Adjusted earnings were $123 million for the quarter compared to $121 in the year-ago period. Demand for OSB was one of the drivers of the growth. North American OSB shipments increased 10 per cent year-over-year reflecting the restart of the Huguley, AL, mill in the fourth quarter of 2017.


Lower Log Sales Affect Acadian

Acadian Timber Corp. had net sales of $26.6 million for the third quarter of 2018, a decrease from net sales of $27.2 million in the third quarter of 2017. Net income for the quarter was $5.9 million, down from $9.7 million in the year-ago period. Adjusted EBITDA was $6.1 million on margin of 23 per cent compared to adjusted EBITDA of $6.7 million on margin of 25 per cent. The company says results reflect changes in foreign exchange dollars, long-term debt, and lower log sales.


November 6, 2018

Lowe's Closing 27 Canadian Stores, Consolidates Operations

Lowe’s Companies, Inc. will close 51 underperforming stores, including 27 stores in Canada, and has completed the consolidation of Lowe's Canada's operations at the Boucherville, QC, which will lead to the closing of the Mississauga, ON, and St. John's, NL, regional support centres in 2019. The retailer says the closures are the result of an ongoing strategic reassessment that will turn the focus to its most profitable stores and improve the overall health of its store portfolio. The Canadian stores represent approximately three per cent of its total retail network square footage. Lowe’s expects to close the impacted stores before the end of January 2019. To facilitate an orderly wind-down, the company intends to conduct store closing sales for most of the impacted locations with the exception of select stores in the U.S., which will close immediately. The Canadian closures – which comprise stores across the company’s Lowe’s, RONA, and Reno-Depot banners ‒ include one store in British Columbia, two in Alberta, nine in Ontario, nine in Quebec, and six in Newfoundland and Labrador. The consolidation of its operations will enable it ‘to improve collaboration between our banners to better serve our customers," says Sylvain Prud'homme, president and chief executive officer, Lowe's Canada. "The decision to close stores is never one that we make lightly. However, following a detailed business review, we believe that this is the right path for the organization's future." In addition to the store closures, a truss plant located in St. John's, NL, and a block plant located in Kamloops, BC, will also be closed.


Home Transformed To Seasonal Wonderland

Canadian Tire transformed a Toronto, ON, home into a festive wonderland, complete with this year’s trendiest decor and hottest toys. Each of the home’s rooms featured some of the more than 800 new items it will carry this year around specific colour themes including the colour of the year, Serene Rose ‒ a rose/gold combination with Scandinavian influences. It also featured some ‘hacks’ for hiding Christmas gift from snoopy little ones. These include unused suitcases and empty large boxes of cereal that children dislike. Tracy Platt, Canadian Tire’s resident style expert, and representatives from toy companies Mattel and Hasbro were on hand to explain some of the 2018 seasonal trends.


Kelowna Homeowners Choosing Renovations Over Selling

A Kelowna renovation contractor says he is seeing an increase in home renovations as well as the building of legal suites and house additions since the provincial government proposed changes to the British Columbia Speculation Tax earlier this year. The revised tax affects those who own secondary properties in certain British Columbia municipalities, including those in Kelowna and West Kelowna, where the government reports that vacancy rates are low. Norm Kneller, co-owner and operator of Rafter 4K Contracting Ltd., says a number of his clients are choosing to renovate their homes instead of selling due to the proposed speculation tax and its effect on the real estate market. Homeowners "now have a five-to-10-year plan to stay in their home until the market hopefully comes back," says Kneller. Another trend he has noticed is the increased demand in home additions and legal suites. Instead of secondary properties, some clients are looking to add a legal suite or addition to their home so that they can sell a portion of their property to a family member.


Canfor To Reduce Production

Canfor Corp. will be reducing production at its British Columbia sawmills by about 10 per cent this quarter, as a result of log supply challenges following a difficult wildfire seasons, uncompetitive log costs, and declining lumber prices. The curtailment will come in the form of decreased operating days and extended downtime at Christmas. Specifics on how the Prince George operations will be affected are not immediately available. The move comes as the union representing about 1,600 workers at 13 northern British Columbia sawmills ‒ including Canfor's PG Sawmill and Isle Pierre sawmills ‒ continue a campaign of rotating strikes in a bid to win a new contract. As well, members of three USW locals representing about 3,500 sawmill workers in the southern interior have voted in favour of giving their bargaining committee a strike mandate.


Foundation Building Materials Completes Insulation Segment Sale

Foundation Building Materials, Inc. (FBM) has completed the sale of its mechanical insulation segment. The company received $122.5 million, which remains subject to certain adjustments, and plans to use the net proceeds to pay down its revolving credit facility.


Lawson Products Has Strong Sales

Lawson Products, Inc. had sales of $88.5 million for the third quarter of 2018, up 17 per cent compared to sales of $75.7 million in the third quarter of 2017. Average daily sales increased to $1.405 million during the quarter compared to $1.201 million in the year-ago period. The ADS segment sales increased four per cent, excluding the Bolt Supply House. Operating loss was $2.3 million in the third quarter, compared to operating income of $1.1 million last year. Non-GAAP adjusted operating income was $5.6 million compared to $3.9 million, up 44.6 per cent.


Slower Earnings For Whirlpool

Whirlpool Corporation had net earnings of $210 million for the third quarter of 2018, a decrease over net earnings of $276 million in the third quarter of 2017. Net sales for the quarter were $5.3 billion, an increase of 1.5 per cent compared to net sales in the year-ago period, excluding the impact of currency. EBIT was $275 million, or 5.2 per cent of sales, compared to $310 million, or 5.7 per cent of sales. Whirlpool North America had net sales of $3 billion for the quarter, an increase of 5.3 per cent, excluding the impact of currency.


November 5, 2018

CBC Reports Newfoundland Stores Closing

The CBC is reporting that Lowe’s Canada will close its three corporate RONA stores in Newfoundland in January. It cites employees of the home improvement chain who were informed at a meeting on Sunday night. The stores will close January 27, 2019. RONA has stores in St. John's, Paradise, Bay Roberts, and Conception Bay South. RONA purchased the Chester Dawe stores in 2006. RONA was then purchased by Lowe’s in 2016. Independently owned RONA stores are not affected.


Consumers Want Product Transparency

Global consumers (70 per cent) are hungry for more transparency about the social, health, environment, and safety credentials of the products they buy rather than the companies that make them (30 per cent), finds 'The Honest Product Guide,' by the Consumer Goods Forum and global change agency Futerra. The guide says that consumers across the world are most likely to look for this information on product labels (36 per cent). Consumer interest in transparency will likely increase in the future, says the Consumer Goods Forum. It explores how transparency is changing in the era of low consumer trust and that breakthrough brands are being transparent in radically new ways, replicating the psychology of human honesty. "Every retailer and branded manufacturer today knows that transparency is essential to build the trust of their consumers and support sustainable growth," says Peter Freedman, managing director of the Consumer Goods Forum. "But in a world of transformed consumer expectations, social media, and other new technologies, we are all having to completely re-learn what transparency means and how to deliver it to shoppers." For more information, visit 'The Honest Product Guide.'


Moneris Launches Digital Marketing Analytics Tool

Moneris Solutions Corporation has launched Offlinx, a digital marketing business analytics tool which measures the impact of online advertising on in-store and online sales. The tool connects consumer browsing activities to purchase transactions, providing retailers with a view of their return on digital advertising investment. Offlinx is powered by a tagging mechanism that anonymously links browsing data to transactions that process through Moneris' national payment network. The proprietary solution uses multi-touch attribution, providing merchants with next-day results on channel sources driving customer purchases in-store and online. The tool features a store-level performance dashboard that presents confirmed in-store card transactions based on retail location and the driving channel sources, including eMails, referral sites, and social media. The daily performance dashboard collects key performance metrics for campaign tracking, including in-store revenue, average purchase amount, and web traffic. Users can customize the data filters to analyze and report on channel and store performance.


Carroll Becomes CHRO

Kathleen Carroll has been appointed senior vice-president and chief human resources officer (CHRO) with Grainger, effective December 3. She has more than 25 years of HR experience, most recently at First Midwest Bank, where she served as executive vice-president and CHRO.


Sales Strong For Trex

Trex Company, Inc. had consolidated sales of $166 million for the third quarter of 2018, an increase of 19 per cent compared to consolidated net sales in the third quarter of 2017. Residential product net sales were $147 million, up 12 per cent year-over-year, and commercial products sales were $19 million. Consolidated gross margin for the quarter was 40.4 per cent. Net income was $29 million, up 47 per cent from the net income of $20 million in the year-ago period.


Lumber Liquidators Has Increased Sales

Lumber Liquidators had net sales of $270.5 million for the third quarter of 2018, an increase of 5.2 per cent over net sales of $257.2 million in the third quarter of 2017. Net sales in comparable stores increased 2.1 per cent year-over-year, partly driven by the expansion of installation services, where sales in comparable stores was up 39 per cent. Gross profit was $100.7 million, an increase of 8.6 per cent over the previous-year quarter. Gross margin increased to 37.2 per cent from 36 per cent. Operating income for the quarter was $6.7 million compared to an operating loss of $17.3 million last year. Adjusted net income was $7.9 million, up from $3.5 million in the year-ago period.


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