Phone: 416-489-3396
Michael McLarney, Editor & President
mike@hardlines.ca
Beverly Allen, Publisher
bev@hardlines.ca
Brady Peever, Client Services Manager
brady@hardlines.ca
John Caulfield, Contributing Editor
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December 14, 2009, Volume xv, #47 |
In This Issue:
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“Scrooge was better than his word. He did it all, and infinitely more; and to Tiny Tim, who did not die, he was a second father. He became as good a friend, as good a master, and as good a man, as the good old city knew, or any other good old city, town, or borough, in the good old world.” —Charles Dickens (Victorian British author, in the final passages of “A Christmas Carol”) |
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Best Wishes from the World Headquarters: We want to thank you all, our Faithful Subscribers, for your support through what has been a tough, challenging, exciting year. Have a very merry Christmas, a happy Chanukah, and any other way you will look for peace and contentment with your family and friends over the coming weeks. See you again in the New Year! —Beverly, Brady, Chiaki and Michael Our Holiday publishing Schedule: There will be no issues on Dec. 21 or 28. Then the next issue is Jan. 5, 2010. However, the World Headquarters remains open until Dec. 21. —Michael |
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CanWel buys rival distributor Broadleaf | ||||||||||||||||||||||||||||
VANCOUVER — CanWel Building Materials Income Fund will acquire rival building materials distributor Broadleaf Logistics in a deal worth $80 million. CanWel is offering $20 million in cash, 10.25 million CanWel shares and a US$18.5 million secured subordinated promissory note to acquire Broadleaf from Rudy Holding II SARL. The total purchase price is subject to a number of post-closing adjustments based on the relative amounts of net working capital of CanWel and Broadleaf.CanWel had 2008 sales of $803.9 million. Broadleaf has similar sales, supported by 270 employees at 14 distribution centres across the country. Broadleaf will be rolled into CanWel’s own building materials distribution business, and the combined company will be called CanWel-Broadleaf. The new combined business is expected to represent about $1.5 billion in sales, making it the largest LBM distributor in the country.
In anticipation of the deal’s closing later in the spring of 2010, CanWel is also converting from an income trust into a dividend paying corporation called CanWel Holdings Corporation. The change anticipates new regulations coming into effect in January 2011 that will eliminate the tax advantages of income trusts.
To help finance the deal and the corporate conversion, CanWel is placing, through GMP, on a bought deal basis, 13,158,000 subscription receipts at $3.80 apiece, for a total of $50 million. The placement will also go to repaying debts and for general corporate purposes.
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Lowe’s confirms locations in Western Canada | ||||||||||||||||||||||||||||
TORONTO — Lowe’s Canada has announced plans for continuing its growth in the Canadian marketplace. Three stores have been confirmed for the Calgary region: a 159,500-square-foot outlet in the East Shepard Industrial Area/McKenzie Town area, one located at CrossIron Mills in the County of Rocky View, and a third in the Sunridge Industrial Area.The company also has plans for British Columbia and Saskatchewan. Most of these new stores will use Lowe’s smaller footprint, 103,000 square feet plus a 30,000-square-foot garden centre. Lowe’s has plans to open 35 to 45 stores in North America in fiscal 2010; at least nine of those will be Canadian sites. | ||||||||||||||||||||||||||||
Lowe’s completes latest round of openings in Canada | ||||||||||||||||||||||||||||
OTTAWA & SUDBURY, Ont. — The latest round of openings by Lowe’s Canada is occurring just before year end, exactly two years after Lowe’s opened its very first stores in this country.The latest opening was in Sudbury, representing the first store in Northern Ontario. It is located across the street from a Home Depot, in a city that already sports a Real Canadian Superstore and a Wal-Mart. The At 103,000 square feet plus a 30,000-square-foot garden centre, it is a little smaller than the regular Lowe’s store, and reflects Lowe’s move to a smaller footprint. A store in the Ottawa market (Orleans) opens this week, with the grand opening on Dec. 18. Located on Innes Rd., it becomes the chain’s 16th in this country. (Full details of Lowe’s expansion plans are in the latest Big Box Report, coming soon in the next edition of our sister publication, Hardlines Quarterly Report!) | ||||||||||||||||||||||||||||
Home Depot announces Martha Stewart paint, Eco lines | ||||||||||||||||||||||||||||
TORONTO — Home Depot continues to develop new products for the Martha Stewart Living brand. The partnership with Martha Stewart Living Omnimedia, Inc., was announced in mid-September, and promised a line of outdoor furniture, storage products and home décor.The latter has materialized as an exclusive Martha Stewart Living brand of interior and exterior paint. The paint is being manufactured by AkzoNobel and will consist of 280 colours created by Martha Stewart and the MSLO design team. In addition, the interior colours will be available in eight-ounce tint-able testers, and 12 of “Martha's Picks” will be available pre-tinted. The Martha Stewart Living Paint will be available at The Home Depot stores across Canada in March 2010. Home Depot will also sell Martha Stewart Clean, a new Eco Options-certified line of cleaning products, developed with and marketed by the Hain Celestial Group, Inc. The retailer is working with MSLO to develop additional products that will be available in 2010, with more details promised in the first part of the New Year. | ||||||||||||||||||||||||||||
Richelieu makes two acquisitions | ||||||||||||||||||||||||||||
MONTREAL — Richelieu Hardware Ltd., the specialty hardware and building products distributor, has acquired two companies. The first is Paint Direct, a Calgary-based distributor of finishing products, stains, lacquers and various other paint products. This acquisition brings Richelieu’s Canadian network to 30 distribution centres.In the United States, Richelieu has acquired Syracuse, N.Y.-based Woodland Specialties, a distributor of hardware products, high-pressure laminates, finishing products and other complementary products targeted mainly at kitchen cabinet makers and the commercial woodworking segment. This acquisition expands Richelieu’s geographic market and increases its U.S. distribution network to 18 centres. The two recently closed acquisitions add annual sales of approximately $6 million to Richelieu’s revenues. It has also signed an agreement to complete another unnamed acquisition that’s expected close in January 2010. | ||||||||||||||||||||||||||||
Lowe’s introduces California energy information centres | ||||||||||||||||||||||||||||
MOORESVILLE, N.C. — Lowe’s is positioning itself as a “go-to” retail destination for energy conscious Californians with the introduction of Energy Centers in 21 California stores. The Energy Center is designed as a one-stop destination to help customers create an energy plan that fits their budget and home improvement goals.An information kiosk offers a touch-screen display to help customers evaluate energy needs, and the Energy Center features products that offer alternative energy solutions. The Energy Center outlines three ways for customers to save energy and money: measure how much energy they use or lose with power monitors and other devices; reduce energy consumption by using CFLs and other money-saving products; and generate and use renewable energy with solar panels. Lowe’s claims to be the first major retailer in the U.S. to offer many of these products in one place and to stock and sell grid-connected solar panels in stores. (In Canada, TIM-BR MART dealers have been positioning themselves as energy experts with staff training and a mandate from head office to buy “green.”) | ||||||||||||||||||||||||||||
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DID YOU KNOW…? |
That we get a LOT of calls every week from marketers asking for the size of the market, the market share of Lowe’s and Home Hardware and RONA and Home Depot, an explanation of how the buying groups are organized — and how they differ, and what we forecast for business conditions for next year. So we’ve put just about everything we know about the Canadian home improvement market into one monster PowerPoint presentation, The Annual Home Improvement Retail Report. Click here for more info! —Michael |
NEWS IN BRIEF |
QUEBEC CITY — BMR le Groupe honoured Connie and Jean-Guy Lasalle, owners of the centres de rénovation Matériaux JLS in Fort-Coulonge and in Bryson, by awarding them the “Prix Fierté 2009.”
At BMR’s recent dealer show here, Yves Gagnon, president of the wholesaler and buying group (r), presented the couple with the award, recognizing their achievements and involvement within the group. Matériaux JLS joined BMR in 2001. The two home centres total some 12,000 square feet of retail space offering a welcoming shopping environment, well known to its customers for quality service and excellent advice — hence the award.
MONTREAL — RDTS, the rep agency and instore detailing service, celebrated its 15th anniversary at the Hyatt Regency here during the recent RONA show.
Almost 200 people were on hand to join RDTS head Robert Di Tomasso, (shown here with his father and mentor, Richard), who has guided the company through a turbulent, dynamic decade and a half to become a national presence that has made technology advances, strategic alliances, and become the first company of its kind in North America to obtain ISO certification.
VANCOUVER — Taymor, the builders’ and decorative hardware supplier, was awarded a top prize of a Black ribbon for the Most Creative Tree at the Festival of Trees at the Four Seasons Hotel here. This was Taymor’s first time at the event, a fundraiser for the B.C. Children’s Hospital Foundation. The themed Tree featured the “12 days to refresh, redecorate or renovate your home” using decorations made with Taymor products such as a “Lever Lock Tress”, Spring Stop Snowflakes and a Spring Stop Tree. The Festival of Trees provides corporate and individual sponsors an opportunity to showcase community leadership, creative flair and innovative themes while helping raise money for a very good cause.
BERLIN — EDRA, the European DIY Retail Association, has become an independent body. In a meeting held here recently, the new association was officially formed. In the past, it had been administered by the DIY associations in France (FMB) and Germany (BHB).
Our old friend, John Herbert (centre), has been appointed general secretary of the Association, which has members from 18 countries that operate in 38 countries. It was also agreed at the inaugural meeting that EDRA will now open its doors to form a Global Home Improvement Network, allowing members outside Europe to become associate members and to benefit from the affiliation of the EDRA network. (For more info, contact: morgan@edra-online.org.)
BOUCHERVILLE, Que. — RONA has been rewarded for its wood products procurement policy by the Canadian Boreal Initiative in Ottawa. RONA was one of six winners selected by a committee of the Boreal Leadership Council, which is made up of leading conservation groups, Aboriginal organizations, and businesses committed to taking action to preserve the boreal forest. RONA was recognized for its leadership in developing and implementing an ambitious procurement policy for the wood products sold in its stores.
CHICAGO — Industrial supply distributor W.W. Grainger Inc. has purchased a 1 million-square-foot distribution centre in the Chicago suburb of Minooka, Ill. It will relocate an existing distribution facility in Niles, Ill., to the new site by 2012.
TORONTO — RONA Inc., in partnership with Maple Leaf Sports & Entertainment and the MLSE Team Up Foundation, has fixed up another sports facility in the GTA. The newly refurbished Ramsden Park Rink is the 10th completed project as part of the MLSE Team Up Foundation Hockey Rink Legacy Program.
ISSAQUAH, Wash. — Costco Wholesale Corp. had November net sales of $6.04 billion, an increase of 9% from $5.55 billion. The company reported year-to-date net sales of $18.57 billion, an increase of 6%.
MONTREAL — Are we in the wrong business? Dollarama Inc. reported significant increases in sales and net earnings despite the economic downturn. Sales increased 14.8% in the third quarter and 15.0% year-to-date. Same-store sales grew 7.3% in both the third quarter and the
year-to-date periods.
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PEOPLE ON THE MOVE |
Duncan Fulton has been hired as vice-president, corporate affairs at Canadian Tire Corp. He most recently general manager and senior partner at Fleishman-Hillard Toronto; before that he was advisor and spokesman for Prime Minister Jean Chrétien, press secretary for Premier Dalton McGuinty, and communications assistant for former Premier Frank McKenna in New Brunswick. |
ECONOMIC INDICATORS |
Retail sales in November increased 1.3% from October and rose 1.9% from November 2008, to $352.1 billion. Excluding autos, retail sales increased 1.2% from the previous month and rose 1.3% from the prior year, to $292.1 billion. (Commerce Dept.) The value of building permits rose 18.0% in October to $6.1 billion. In the residential sector, the value of permits climbed 3.8% to $3.4 billion, the third consecutive monthly increase. Ontario and Quebec accounted for much of the growth seen at the national level. In the non-residential sector, municipalities issued permits worth $2.7 billion, up 42.4% following a 9.2% decline in September. (Stats Canada) Housing starts reached 158,500 units seasonally adjusted in November, a 0.07% increase from 157,400 starts in October. Urban starts increased by 0.7% to 141,100 units. Urban multiples were down from 72,500 units in October to 71,300 units. Single urban starts increased by 3.4%. Urban starts increased by 10% in Quebec, by 8.2% in the Prairies and by 6.2% in British Columbia. The rate of urban starts decreased by 8.3% in Ontario and by 9.8% in Atlantic Canada. (CMHC) |
OVERHEARD... |
“I think we’ve raised the bar on home improvement in Canada.” — Alan Huggins, president of Lowe’s Canada. He was speaking last week in a TV interview on BNN, following the announced expansion of Lowe’s in Western Canada. |
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