August 12, 2020
Renovation Intentions Slide
Canadian home renovation spending is forecast to decline in 2020, though not as significantly as the overall economy, says Altus Group in its latest ‘Housing Report.’ Total renovation spending in 2019 totalled $80.1 billion, of which $61.2 billion was spent on upgrading or making improvements to homes; this virtually matches the total spending on new home construction nationally. Renovation spending has also been steadily increasing, with annual growth of renovation spending exceeding that of the overall economy. Undoubtedly impacted by the COVID-19 pandemic, Altus Group’s homeowner renovation intentions index has plunged. With the exception of Atlantic Canada, homeowners in most regions across the country report lower renovation intentions than last year, primarily among homeowners not also intending to move. Intentions to undertake larger renovations of $10,000 or more in the next year are down from last year, while intentions to buy another home are virtually unchanged. Only two per cent of current homebuyers are planning to do both – these homeowners may either be planning significant renovations to prepare their current home for sale, or planning sizable renovations on their next home.
July Housing Starts Increase
The trend in housing starts was 204,376 units in July, up from 199,778 units in June, says the Canada Mortgage and Housing Corporation (CMHC). This trend measure is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts. The standalone monthly SAAR of housing starts for all areas in Canada was 245,604 units in July, an increase of 15.8 per cent from 212,095 units in June. Higher multi-family starts in major urban areas, including Toronto, ON, Vancouver, BC, and oil-producing centres in the Prairies drove the national increase. The SAAR of urban starts increased by 17.4 per cent, multiple urban starts increased by 18.8 per cent, and single-detached urban starts increased by 12.3 per cent. Rural starts were estimated at a SAAR of 13,609 units.
Small Businesses Begin Rehiring
As Canadian provinces begin entering stage three of reopening, they are also embarking on another promising economic phase: rehiring. Fifty-eight per cent of small businesses that laid off staff due to COVID-19 are now planning to rehire in the next three months, says a survey by Wagepoint, an online small business payroll software company. Layoffs in March represented 60 per cent of layoffs this year but, by the end of June, 55 per cent of those employees had been rehired, an upward trend that continued into July. When COVID-19 first struck, 60 per cent of Canadian small businesses were forced to make rapid changes to their workforce. Forty per cent reduced headcount (either temporarily or permanently) and 44 per cent reduced hours or compensation. Firms with 10 or more employees were the hardest hit (70 per cent reduced either headcount, hours, or compensation). Firms with fewer than 10 employees were still impacted, but less so (57 per cent reduced either headcount, hours, or compensation). Wagepoint says that as Canada's small businesses continue to overcome the unpredictable nature of economic fluctuation and recovery, similar patterns of furloughing and re-hiring are likely to be seen in the coming months and potentially years.
Beacon Third Quarter Sales Down
Beacon had net sales of $1.79 billion in the third quarter of 2020, a decrease 6.9 per cent compared to net sales of $1.92 billion in the third quarter of 2019. Residential roofing product sales decreased 1.3 per cent, non-residential roofing product sales decreased 9.6 per cent, and complementary product sales decreased 12.5 per cent compared to the prior year. The company had a net loss of 6.7 million for the quarter compared to net income of $31 million in the year-ago period. Third quarter results were primarily impacted by reduced sales and lower gross margins, largely attributable to a softer demand environment induced by COVID-19. Adjusted net income was $69.5 million, compared to $72.6 million last year. Adjusted EBITDA was $147.5 million, compared to $157.8 million.
ADS Sales Down, Profit Up
Advanced Drainage Systems, Inc. (ADS) had net sales of $508.6 million for the first quarter of fiscal 2021, down 22.9 per cent compared to net sales of $413.7 million in the first quarter of fiscal 2020. Sales for the domestic allied products and other sales segment increased $4.7 million, or 4.2 per cent, to $116.9 million. These increases were driven by growth in both the U.S. construction and agriculture end markets. Gross profit for the quarter was $188.5 million compared to a loss of $62.2 million in the year-ago period. Adjusted EBITDA was $159.5 million, up 98.6 per cent compared to $80.3 million last year.
August 11, 2020
Fraser Valley Home Sales Up 22 Per Cent
There were a total of 2,100 home sales in July in the Fraser Valley, BC, an increase of 22.2 per cent compared to sales in June and an increase of 44 per cent compared to the 1,458 sales during July of last year, says the Fraser Valley Real Estate Board (FVREB). Home sales were 25.5 per cent above the 10-year average for July and second only to July 2015. There were 3,549 new listings in July, up 2.76 per cent compared to June and 18.3 per cent above the 10-year average for the month.
Well Made Here Moves Up Website Project
The Well Made Here/Bien Fait Ici program is moving up its project aiming to transform the ici-here.ca website into a transactional platform. “The deadline must be brought closer because the health crisis has accelerated the popularity of online business,” says Richard Darveau, president and chief executive officer of the Quebec Hardware and Building Supply Association (AQMAT), and chairman of the board of directors for Well Made Here. The project will be an experiment with a virtual marketplace that respects existing stakeholders (retailers, banners, distributors, and manufacturers) and will serve a dual qualitative objective – the promotion of local buying via closer relationships between complementary companies, and the acceleration of the end-user delivery phase for hardware items or construction materials through a coherent and efficient virtual infrastructure and transparent logistics. “In due course, we will be asking the government of Canada for financial support and recognition,” says Darveau. “We believe that the timing is in our favour. The government must help economic recovery and consolidate the manufacturing fabric of the country while helping retail businesses that have established themselves in our towns and villages.”
Wolseley Merges Cornwall Stores
Wolseley Canada has opened a plumbing and HVAC/R store in Cornwall, ON. The store brings together two existing Cornwall branches in one renovated space, offering both plumbing and HVAC/R products that are exclusive to Wolseley Canada. Jason Lobb is the branch manager.
Simpson Strong-Tie Expands Yield-Link Capabilities
Simpson Strong-Tie has introduced newly validated slope beam and multi-axis moment applications for its Yield-Link moment connection for structural steel construction. Designed to absorb forces in a seismic or high wind event, the Yield-Link moment connection requires no field welding and allows beams to be designed without supplemental lateral bracing. This means fewer fabricated steel elements and field connections are needed. Simpson Strong-Tie has developed two solutions utilizing the Yield-Link moment connection with sloped structural beams. At the roof level, structural steel beams are often sloped to accommodate drainage, and the new solutions provide greater design flexibility and streamlined field connections when using the Yield-Link in slope beam applications. As well, the company introduced solutions utilizing the Yield-Link for multi-axis moment connections. Designed for corner, three-sided, and four-sided column connections, Yield-Link multi-axis moment connection solutions provide a connection that resists moment demand in both directions of the column.
Norbord Earnings Rise
Norbord Inc. had adjusted EBITDA of $84 million for the second quarter of 2020, up from adjusted EBITDA of $36 million in the second quarter of 2019. The increase was primarily due to higher realized North American oriented strand board (OSB) prices, as well as lower manufacturing costs, partially offset by lower shipment volumes. North American operations had adjusted EBITDA of $84 million compared to $18 million in the year-ago period. In North America, second quarter shipments were down 12 per cent year-over-year. Overall net sales for the quarter were $508.6 million, up from $413.7 million last year. Adjusted earnings were $31 million compared to a loss of $8 million last year.
August 10, 2020
Montreal July Home Sales Rebound
A total of 5,356 residential sales transactions were concluded in July in the Montreal, QC, census metropolitan area, an increase of 46 per cent compared to July 2019, says the Quebec Professional Association of Real Estate Brokers (QPAREB). All six main areas of the Montreal CMA registered a significant increase in sales compared to July of last year, with particularly impressive increases on the North Shore of Montreal (+84 per cent) and in Vaudreuil-Soulanges (+65 per cent). Single-family homes were the property category that posted the largest sales increase in July, with a 48 per cent jump in transactions. Sales of condominiums and plexes also increased considerably, rising by 45 per cent and 34 per cent, respectively. Selling times decreased for all three property categories. In terms of the supply of properties for sale, the 5,960 new listings in July represented a 38 per cent increase compared to July of last year and a reversal of trend after six consecutive years of declines in the month of July.
Lowe’s Canada Supports Communities
Over the last few months, Lowe’s Canada has presented over $245,000 in donations in cash or in kind to over 75 community organizations that help the most vulnerable, such as food banks and hospital foundations. “With the pandemic causing new problems to emerge and exacerbating existing issues, we felt it was important to express our solidarity by supporting community organizations that are facing higher demand and declining resources,” says Jean-Sébastien Lamoureux, senior vice-president, public affairs, asset protection and sustainable development at Lowe’s Canada. “Our field teams selected the organizations to support based on their knowledge of their regions and the needs of their communities.” Last April, Lowe’s Canada committed $1 million to support its associates and communities affected by the COVID-19 pandemic through a range of initiatives. Among other things, corporate stores from the Lowe’s Canada network received more than $240,000 to support initiatives addressing specific needs in their regions.
Home Depot To Open Three Georgia Distribution Centres
The Home Depot will open three distribution centres in Georgia over the next 18 months to support the growing demand for flexible delivery and pick-up options for its professional and DIY customers. In 2017, the company announced a $1.2 billion investment to expand its distribution network with approximately 150 new supply chain facilities nationwide, with the goal of expanding the company’s existing same-day and next-day delivery options to 90 per cent of the U.S. population. These facilities include a variety of formats to distribute products from small parcel packages to big and bulky product. The Stonecrest, GA, facility will be a ‘flatbed delivery centre’ that will offer same-day and next-day delivery of bulk and oversized orders directly to a job site.
HDI Sales Down, Profit Up
Hardwoods Distribution Inc. (HDI) had sales of $296 million for the second quarter of 2020, a decrease of 2.8 per cent over sales of $304.5 million in the second quarter of 2019. Sales in Canada decreased 13.3 per cent year-over-year and sales in the U.S. decreased 4.89 per cent. Gross profit for the quarter was $57.8 million, up 5.1 per cent compared to $55 million in the year-ago period and gross profit margin was 10.5 per cent compared to 18.1 per cent. Adjusted EBITDA was $24.4 million, up 15.3 per cent over $21.2 million last year. Profit for the quarter grew 25.2 per cent to $10.2 million from $8.2 million in the year-ago period.
Higher Prices Increase Taiga Sales
Taiga Building Products Ltd. had consolidated net sales of $356.9 million for the second quarter of 2020, a one per cent increase over net sales of $354.7 million in the second quarter of 2019. The increase was largely due to higher selling prices for commodity products. Gross margin for the quarter was $42.7 million compared to $34.9 million in the year-ago period. Gross margin percentage was 12 per cent compared to 9.8 per cent. The company had net earnings of $13.1 million compared to $7.1 million last year while EBITDA was $23.9 million compared to $16.4 million. EBITDA increased primarily due to higher margin during the quarter combined with the Canada Emergency Wages Subsidy (CEWS) reducing overall expenses.
August 7, 2020
Williams Named TORBSA President
Paul Williams is president of TORBSA Limited. Most recently, he was regional manager, Ontario, for CGC Inc. He succeeds Bob Holmes, general manager, who is retiring after leading the group for 26 years.
Quebec City Home Sales Retain Momentum
In total, 899 residential sales transactions were concluded in July in Quebec City, QC, a 43 per cent increase compared to July of last year, says the Quebec Professional Association of Real Estate Brokers (QPAREB). This rise in sales followed an already significant rebound in transactions in June, after the lifting of measures aimed at containing the spread of the new coronavirus. Sales of single-family homes rose substantially in July (+38 per cent), with a total of 616 transactions. During the month, there were 2,930 active listings, which is significantly less than in July of last year (-33 per cent). Again this month, sales of condominiums (216 transactions) increased significantly, growing by 55 per cent year-over-year.
Band Saw Designed For Tight Work Spaces
Bosch’s 18V Compact Band Saw enables users to make cuts in tight work spaces, overhead, or in corners. The band saw weighs 7.3 pounds and has a cut rate of 530 surface feet per minute. It is able to slice through common-size materials including conduit, uni-strut, threaded rod, copper, and black pipe while yielding up to 2-1/2 inches on a single pass. It features a centre-placed auxiliary handle, a soft-grip main handle, and a built-in LED light. It also offers a tool-free blade guard and tool-free blade change, protecting the blade from debris and facilitating easy access for blade installation or removal.
CEWS Grants Help Western Earnings
Western Forest Products Inc. had adjusted EBITDA of $29.5 million for the second quarter of 2020, an increase over adjusted EBITDA of $25.1 million for the second quarter of 2019. Net income was $8.5 million for the quarter compared to a net loss of $0.7 million in the year-ago period. Second quarter adjusted EBITDA included $10.7 million of federal government grants accessed through the Canadian Emergency Wage Subsidy (CEWS) program. Lumber revenue in the second quarter was $188.8 million, a decrease of 19 per cent from the same period last year. Lumber and log sales were impacted by market uncertainty and delayed shipments arising from COVID-19. Log revenue was $60.5 million, a decrease of four per cent from the same period last year. By-product revenue was $7 million, a decrease of 48 per cent year-over-year.
Lumber Liquidators Sales Slow
Lumber Liquidators, which is changing its brand name to LL Flooring to reflect its core offering, had net sales of $230.3 million in the second quarter of 2020, a decrease of 20.2 per cent over net sales of $288.6 million in the second quarter of 2019. The decrease was mainly driven by the impact of COVID-19. Gross profit for the quarter decreased 14 per cent to $88 million from $102 million in the year-ago period. Adjusted gross margin increased 309 basis points to 38.3 per cent from 35.2 per cent. Net income was $2.6 million compared to a net loss of $2.9 million last year.