HARDLINES™ Canada’s electronic news service for the home improvement industry February 12, 2001 Volume vii, #6 Michael McLarney, Editor & Publisher Phone: 416.489.3396 Fax: 416.489.6154 email: mike@hardlinesfax.com hardlines.ca
* * * * * *IN THIS ISSUE:
- Rumours take back seat to seminars, awards at Canadian Hardware Show - Ace signs supply deal with Tim-BR-Marts - Two more buying groups to develop online trading - Sunbeam’s woes leave Canadian division unaffected * * * * * * RUMOURS TAKE BACK SEAT TO EDUCATION, SALES AT CANADIAN HARDWARE AND BUILDING MATERIALS SHOW The 96th edition of the Canadian Hardware and Building Materials Show finished on Tuesday to a mixed bag of responses. As always, the show was a forum for vendors to interact with both key buyers and independent retailers from across the country. While attendance numbers are not yet available, the overall impression was that there were slightly fewer bodies walking this year’s show than in years past. Nonetheless, the majors were present, including customers from throughout North America. A contingent of 60 retailers even flew in from France for the show. This was also the second year to feature the involvement of the Lumber and Building Materials Association, which rolled its own Canadian Home Centre Show into CHS last year. For the first time this year, the paint and décor section of the show was beefed up thanks to the participation of that sector, which also gave up its own show to join forces with CHS. While many familiar decorating companies were present, a number of newcomers were also seen, adding to the diversity of the section. There were also fewer rumours circulating. While last year’s show became the showcase for the unveiling of Sodisco-Howden’s new PRO initiative and Rona announced its acquisition of Cashway, this year was bereft of good gossip. (Except for the one about Revy being bought - eventually - by someone.) In an effort to keep the show fresh and relevant, greater emphasis was placed on the speaker program, which included Steve Johns of the LBMAO outlining the importance of government lobbying, Ian Gray of LBMX on e-commerce as a competitive tool against big boxes and Carson O’Neill of Rincroft Inc., with tips for building the value of one’s own retail business. (The show was kicked off by an incredible laser sound and light show at the Hardlines Breakfast on February 4. Our thanks to George Lucas for the special effects equipment.)
SOME FEEDBACK ON CHS: Larry Koza, Can-Save, Barrie, ON: “We had 40 or 50 new products to show. We see a lot of our customers in a very short time.” Jon Bazar, Innovak, Montréal: “Sunday was zoo in here.” Dave Katt, Old Masters Paint, Iowa: “The fact that window treatments was missing as a category in the décor side of the show definitely affected the level of exposure my product got. Dealer attendance seems low, and that is probably because this category was missing.” Luc Rivest, Sia Abrasifs, St-Nicholas, QC: “I filled most of my contact expectations, around 80% of them, on the first day of the show. After that I was able to make some unexpected contacts with people from the semi-industrial side of things, mostly in the drywall trade.” An agent representing a number of vendors’ products: “It’s a great show. We’ve seen everybody we wanted to see. But you can’t sit in a chair all day.” Harold Dawe, Stan Dawe Ltd., Corner Brook, NF: “There are no deals in this show, even though there is still room for deals … I don’t spend as much money here as I’d like to spend; but if I’m going to spend I want it to be because I am saving on it.” Ib Fynbo, owner of Essex Home Hardware, Essex, ON: “The deals are there, but you have to sit down and negotiate with vendors.”
SOME PRODUCTS THAT CAUGHT OUR EYE AT CHS: Carter Off-Road Machines, by Carter Brothers Mfg.: a really wacky looking off-road vehicle - reminiscent of the old dune buggies. With a Tecumseh engine and full independent hydraulic suspension. Drylok masonry waterproofer, by United Gilsonite Laboratories: this basement sealer is now available in Canada; in both oil and latex bases. Lorne Heise Heatline, invented by Lorne Heise of Pipe Heating Cable System, and distributed by Fred Pierce Sales and Marketing: this was the winner of the top prize for Innovative New Product and is a marvel of simplicity. An acrylic polymer separates two wires strung along the length of the pipe. At different intervals, the two wires are set to heat up if they make contact, which can only happen if the contents of the pipe are cold enough to freeze, and therefore shrink the polymer between them. Simple, cost effective, inventive. Some cool proprietary hand tools from Allied International, courtesy of Innovak, plus a handy new multi-bit screwdriver from Fuller. The carpenter’s pencil sharpener, by the Wilton Tool Group: it allows for the shape of the pencil while still gripping the tip and shaving the lead to a strong, sharp point. This little gadget sold itself through demonstration. From ICI, a new CD-ROM that enables the shopper to go home and call up different rooms with different colour matches on the computer screen before committing to a gallon of paint.
SOME AWARD WINNING STORES AT CHS: The Sylvan Lake True Value Hardware of Sylvan Lake, AB, received the Outstanding Retailer Award in the category: best hardware store under 5,000 sq. ft. A family-run operation, Sylvan Lake True Value won the award based on its outstanding performance in areas such as profitability, merchandising skill, community involvement, customer service and advertising. Rona Le Regional in Granby, QC received the Outstanding Retailer Award for big-box retail store over 50,000 sq.ft., while the Newcastle, ON Rona Hardware was selected as Rookie of the Year by the Canadian Retail Hardware Association.
ACE MAKES SUPPLY DEAL WITH TIM-BR-MART Ace Hardware Canada has made a deal with Tim-BR-Marts Ltd. to become a supplier for the group’s 184 member stores throughout Western Canada. The deal was struck after Barrie Sali, Tim-BR-Mart’s president and CEO, agreed to give his members access to the group’s products and programs. The company existing hardware suppliers include regionals and Sodisco-Howden Group. “Ace has been endorsed by Barrie Sali. He’s opened the door for us,” says Paul Ingevaldson, vice-president, corporate strategy and international business for Ace Hardware Corp. in Oak Brook, Ill. In signing with Ace, Tim-BR-Marts joins other buying groups that are looking not only to expand their hardware assortments, but to gain access to more store programs. Homecare, Castle and AWARD already have agreements in place. Negotiations continue with BMR in Québec, but it has its own distribution, “so we’re trying to figure out a fit,” says Ingevaldson. “We’re very positive about that.” Ace currently ships to 101 stores in Canada that are either Ace stand-alone stores or sport the Ace name in association with another banner.
SUNBEAM CANADA UNAFFECTED AS PARENT FILES FOR CHAPTER 11 The Sunbeam Corp. filed for bankruptcy protection last week after a three-year effort to recover from an accounting scandal and a series of acquisitions that left it US$2.6 billion in debt. Sunbeam stock sold for US$0.51 at the time of its suspension; it had traded for as much as US$6 per share in March 2000. Sunbeam Canada remains unaffected by this turn of events, says Bruce MacDougall, who heads up the operation here. “Absolutely, it’s business as usual. Canada is not affected by the restructuring in the U.S.,” he says. “We have our own financing, so we’re not really even part of the chapter 11 in the U.S.” Product continues to be shipped and suppliers to be paid, he adds. As part of the U.S. reorganization plan, banks that made a combined commitment to lend US$1.7 billion have agreed to provide another US$285 million to let Sunbeam stay in business through debtor-in-possession financing, which gives the lenders first claim on a company's assets. Sunbeam's problems became apparent in 1998, when Albert (“Chainsaw Al”) Dunlap, a turnaround expert who was then the company's chief executive, was discovered to have artificially bolstered sales by getting retailers to accept more goods than they could possibly sell. Sunbeam was also struggling with a load of debt, including the US$1.7 billion bank loan it had taken on earlier that year after making three acquisitions.
COMPANIES IN THE NEWS Sears Canada released revenues for the four-week period ending January 27, 2001, posting a 9.9% increase to $482.8 million, from $439.4 million for the same period last year. Same-store sales were flat with last year. Adjusting for the same selling days, same store sales were up 3.7% compared with last year. LBMX has joined forces with two more retail groups, Castle Building Centres and Homecare Building Centres, to develop electronic trading communities. The online initiatives will focus on more efficient exchange of invoices and order placements between dealers, vendors and head office. Currently, 60% of Castle’s members are able to place orders electronically. Last month, LBMX announced similar agreements with Sexton Group and TruServ Canada. West Fraser Timber Co. has entered into an agreement to purchase Ainsworth Lumber's sawmill located at Chasm, BC, which includes 695,000 m3 of annual timber harvesting rights, for a net purchase price of $22 million plus working capital. The company, which recently purchased two sawmills in the southern U.S., also reported earnings of $144 million for the year on sales of $2.31 billion (versus 1999 sales of $2.20 billion). CGC Inc. will be the exclusive Canadian distributor of Trimroc Interior Mouldings, manufactured in Vaughan, ON by Canamould Extrusions Inc. They will be sold through the company’s existing customer base of retail and commercial dealers. Emco’s Building Products division has entered an alliance with Atlas Roofing Corporation of Meridian, Miss., with the purpose of producing non-laminate overlay architectural shingles for sale by both parties. Emco is investing in the modification of a roofing machine at the Atlas manufacturing facility in Quakertown, Penn. Camco announced a net income of $14.1 million for the twelve months ending Dec. 31, 2000 compared with $5.5 million for the same period in 1999. Sales were $697.2 million, compared with $638.3 million in 1999. Sales for the fourth quarter of $183.4 million were down slightly from 187.2 million in 1999. Net income for the fourth quarter was $4.4 million, compared with $1.2 million in 1999. Home Depot Inc. will expand its major appliance offering in 2001 through partnerships with General Electric Co. and Maytag Corp. The company plans to sell GE-branded air conditioners and to increase the number of models on the sales floors. Other aspects of the push include the addition of specially trained sales staff and enhanced product displays. Home Depot currently sells GE and Maytag home appliances instore and through web-based kiosks in the stores. Lowe's Cos. cut its fourth quarter earnings projection for the second time after unexpected promotional pricing before Christmas hurt earnings by US$0.04 a share. The company now expects to earn US$0.37 a share on a same-store sales decline in the middle of the 2% to 4% range. Earnings had been projected at US$0.40 to US$0.42 in early December 2000. For the fourth quarter ended Jan. 28, 2000, Lowe's earned US$148.9 million on sales of $3.8 billion. Sherwin-Williams Co. announced a fourth-quarter earnings fall of 17.5% to US$46.2 million, compared with US$56 million in the 1999 fourth quarter. Consumer segment net sales fell 2.5% to US$231.1 million. The company anticipates sales for the year to rise 1% to 3%, with 1% to 6% increases in the paint store, automotive and international coatings segments, while consumer segment sales will fall anywhere from 4% to 6%. Sherwin-Williams is reorganizing its consumer segment into wood products, aerosol and consumer paint divisions in an effort to cut costs and increase focus on distinctive product categories.
CANADIAN STOCK WATCH COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.) Canadian Tire 37.35 15.10 21.00 Canfor 19.80 8.10 9.30 Goodfellow 12.55 8.50 9.60 Home Depot 70.00 34.68 46.89 Hudsons Bay 21.65 12.50 17.21 Lowe’s 67.25 34.25 53.84 Sears Canada 42.50 20.00 23.70 Taiga Forest 14.20 6.80 7.70 West Fraser 39.50 25.80 27.66
“Knowledge advances by steps, and not by leaps.” - Lord Macauley (1800-1859)
MARKET INDICATORS Municipalities issued $37.7 billion worth of building permits in 2000 says Stats Canada, the second highest ever performance in both residential and non-residential sectors. The 5.4% gain from 1999’s total was the fifth straight annual increase in overall construction intentions. Housing intentions were up 3.3%, totalling $20.6 billion. High levels of employment and low, stable mortgage rates contributed to the strong performance in planned residential projects, with a 5.2% increase or $15.0 billion total in permits issued for single-family dwellings. The value of non-residential permits was up 8.1% to $17.1 billion, with increases in industrial, commercial, and institutional components. This is the highest level reached in 11 years. Provincially, the most significant growth in 2000 occurred in Ontario, up 9% to $7.5 billion, and Alberta, up 22.3% to $2.5 billion. Strong demand for manufacturing plants, as well as a 33.4% increase in institutional intentions, played a key role in Ontario’s growth.
PEOPLE ON THE MOVE Penny Mauro has been promoted to director of marketing at Weiser Lock. She was formerly director of sales national accounts and has had over seven years of experience in the company. (604-419-4383)
OVERHEARD ... … “As an alternative to other distributors, we can provide other services; and with our North American volumes, we can provide pricing that keeps us extremely competitive.” - Paul Ingevaldson, vice-president, corporate strategy and international business for U.S.-based Ace Hardware Corp., on signing a supply agreement with Tim-BR-Marts Ltd.
* * * * *HARDLINES MARKETPLACE* * * *
Porter-Cable Delta, a recognized provider of quality woodworking products worldwide, currently requires an enthusiastic professional as Territory Sales Rep - Southwestern Ontario. A resourceful individual with the ability to organize and communicate successfully, you’ll be directing the operations for your territory and meeting strategic objectives. As a high achiever, you have three years’ field sales experience in the hardware industry, machinery knowledge, and computer literacy. You have a valid driver’s licence and a diploma/degree in Business. A background in power tools is desirable. If you are looking for a progressive organization and a competitive compensation package, please fax your resume to Human Resources, (519) 836 9352, or mail to 505 Southgate Drive, P.O. Box 848, Guelph, Ontario, N1H 6M7 We thank all applicants in advance and advice that only candidates selected for an interview will be contacted.
DURING THIS YEAR’S CHS … VISIT BOOTH # 3945 to view K & D Products’ new STURDY-STEP product line. New to Canada, the STURDY-STEP is ideal for any number of business, professional or Do-It-Yourself applications. With a 22" work platform that holds up to 350 lb. and a top step that is 15½“ high, the STURDY-STEP is the ideal companion for the hard to reach areas. For further information contact: Pat Smith at 1-866-791-0281; or email at patrickrsmith@home.com. Visit our website at www.sturdy-step.com.
WANT THE BIG PICTURE? THEN GET OVER TO the Cologne International Hardware Fair/DIY’TEC:Contact Trade Show Travel by phone (877-873-7469) or fax (403-247-2448) or to arrange your trip. BOOK EARLY! Packages include return airfare and accommodations, as well as admission to the Exhibition. And don’t forget the Canada Night Reception sponsored by Hardlines and Cologne International Trade Shows! We’ll see you in Cologne.Over 3,800 suppliers from 57 countries are expected in three trade fair theme areas: The World Tools Centre, Security Systems Locks and Fittings, and DIY’TEC. The Hardware sector will occupy the entire exhibition space at KolnMesse - that is over 3 million sq.ft. of hardware and building supplies!
THE HARDLINES MARKETPLACE: just $16 per line. Contact Eugenia at 416.489.3396 or email: buzz@hardlinesfax.com
HARDLINES WHO’S WHO 2000-2001 EDITION: The only annual guide to Canada’s leading hardware and home improvement retailers, wholesalers, buying groups, mass merchants and co-ops. The Who’s Who lists more than 100 companies, with executives, product categories, sales, number of outlets, buyers, etc. The cost is only $125 for subscribers, or $165 for non-subscribers (+GST/HST). "THE HARDLINES INDUSTRY REPORT: Home Improvement Retailing in Canada” is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends - and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, only $750 for subscribers. Order by February 6, 2001, and SAVE $55 off our regular price! You can order both these incredible books online: https://www.securewebsite.net/~hardline/order.html or contact Nancy Wright at nancy@hardlinesfax.com; phone: 416-489-3396 for more information.
HARDLINES™ the electronic newsletter hardlines.ca Phone: 416.489.3396; Fax: 416.489.6154 Michael McLarney, Editor & Publisher: mike@hardlinesfax.com Eugenia Canas, Assistant Editor: buzz@hardlinesfax.com Beverly Allen, Marketing Manager: bev@hardlinesfax.com Nancy Wright, Circulation Manager: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2001 by Michael McLarney.
THE HARDLINES “FAIR PLAY” POLICY: Reproduction in whole or in part is very uncool and strictly forbidden and really and truly against the law. So please, play fair! Call for information on multiple subscriptions or a site license for your company. We do want as many people as possible to read Hardlines each week - but us handle your internal routing from this end!
Subscription: $199+$13.93 GST = $212.93 (or $29.85 HST = $228.85) per year (GST #13987 0398 RT). You can pay online by VISA at our secure website or send us money. Please make cheque payable to McLarneyCom.   HARDLINES™ Canada’s electronic news service for the home improvement industry February 12, 2001 Volume vii, #6 Michael McLarney, Editor & Publisher Phone: 416.489.3396 Fax: 416.489.6154 email: mike@hardlinesfax.com hardlines.ca
* * * * * *IN THIS ISSUE:
- Rumours take back seat to seminars, awards at Canadian Hardware Show - Ace signs supply deal with Tim-BR-Marts - Two more buying groups to develop online trading - Sunbeam’s woes leave Canadian division unaffected * * * * * * RUMOURS TAKE BACK SEAT TO EDUCATION, SALES AT CANADIAN HARDWARE AND BUILDING MATERIALS SHOW The 96th edition of the Canadian Hardware and Building Materials Show finished on Tuesday to a mixed bag of responses. As always, the show was a forum for vendors to interact with both key buyers and independent retailers from across the country. While attendance numbers are not yet available, the overall impression was that there were slightly fewer bodies walking this year’s show than in years past. Nonetheless, the majors were present, including customers from throughout North America. A contingent of 60 retailers even flew in from France for the show. This was also the second year to feature the involvement of the Lumber and Building Materials Association, which rolled its own Canadian Home Centre Show into CHS last year. For the first time this year, the paint and décor section of the show was beefed up thanks to the participation of that sector, which also gave up its own show to join forces with CHS. While many familiar decorating companies were present, a number of newcomers were also seen, adding to the diversity of the section. There were also fewer rumours circulating. While last year’s show became the showcase for the unveiling of Sodisco-Howden’s new PRO initiative and Rona announced its acquisition of Cashway, this year was bereft of good gossip. (Except for the one about Revy being bought - eventually - by someone.) In an effort to keep the show fresh and relevant, greater emphasis was placed on the speaker program, which included Steve Johns of the LBMAO outlining the importance of government lobbying, Ian Gray of LBMX on e-commerce as a competitive tool against big boxes and Carson O’Neill of Rincroft Inc., with tips for building the value of one’s own retail business. (The show was kicked off by an incredible laser sound and light show at the Hardlines Breakfast on February 4. Our thanks to George Lucas for the special effects equipment.)
SOME FEEDBACK ON CHS: Larry Koza, Can-Save, Barrie, ON: “We had 40 or 50 new products to show. We see a lot of our customers in a very short time.” Jon Bazar, Innovak, Montréal: “Sunday was zoo in here.” Dave Katt, Old Masters Paint, Iowa: “The fact that window treatments was missing as a category in the décor side of the show definitely affected the level of exposure my product got. Dealer attendance seems low, and that is probably because this category was missing.” Luc Rivest, Sia Abrasifs, St-Nicholas, QC: “I filled most of my contact expectations, around 80% of them, on the first day of the show. After that I was able to make some unexpected contacts with people from the semi-industrial side of things, mostly in the drywall trade.” An agent representing a number of vendors’ products: “It’s a great show. We’ve seen everybody we wanted to see. But you can’t sit in a chair all day.” Harold Dawe, Stan Dawe Ltd., Corner Brook, NF: “There are no deals in this show, even though there is still room for deals … I don’t spend as much money here as I’d like to spend; but if I’m going to spend I want it to be because I am saving on it.” Ib Fynbo, owner of Essex Home Hardware, Essex, ON: “The deals are there, but you have to sit down and negotiate with vendors.”
SOME PRODUCTS THAT CAUGHT OUR EYE AT CHS: Carter Off-Road Machines, by Carter Brothers Mfg.: a really wacky looking off-road vehicle - reminiscent of the old dune buggies. With a Tecumseh engine and full independent hydraulic suspension. Drylok masonry waterproofer, by United Gilsonite Laboratories: this basement sealer is now available in Canada; in both oil and latex bases. Lorne Heise Heatline, invented by Lorne Heise of Pipe Heating Cable System, and distributed by Fred Pierce Sales and Marketing: this was the winner of the top prize for Innovative New Product and is a marvel of simplicity. An acrylic polymer separates two wires strung along the length of the pipe. At different intervals, the two wires are set to heat up if they make contact, which can only happen if the contents of the pipe are cold enough to freeze, and therefore shrink the polymer between them. Simple, cost effective, inventive. Some cool proprietary hand tools from Allied International, courtesy of Innovak, plus a handy new multi-bit screwdriver from Fuller. The carpenter’s pencil sharpener, by the Wilton Tool Group: it allows for the shape of the pencil while still gripping the tip and shaving the lead to a strong, sharp point. This little gadget sold itself through demonstration. From ICI, a new CD-ROM that enables the shopper to go home and call up different rooms with different colour matches on the computer screen before committing to a gallon of paint.
SOME AWARD WINNING STORES AT CHS: The Sylvan Lake True Value Hardware of Sylvan Lake, AB, received the Outstanding Retailer Award in the category: best hardware store under 5,000 sq. ft. A family-run operation, Sylvan Lake True Value won the award based on its outstanding performance in areas such as profitability, merchandising skill, community involvement, customer service and advertising. Rona Le Regional in Granby, QC received the Outstanding Retailer Award for big-box retail store over 50,000 sq.ft., while the Newcastle, ON Rona Hardware was selected as Rookie of the Year by the Canadian Retail Hardware Association.
ACE MAKES SUPPLY DEAL WITH TIM-BR-MART Ace Hardware Canada has made a deal with Tim-BR-Marts Ltd. to become a supplier for the group’s 184 member stores throughout Western Canada. The deal was struck after Barrie Sali, Tim-BR-Mart’s president and CEO, agreed to give his members access to the group’s products and programs. The company existing hardware suppliers include regionals and Sodisco-Howden Group. “Ace has been endorsed by Barrie Sali. He’s opened the door for us,” says Paul Ingevaldson, vice-president, corporate strategy and international business for Ace Hardware Corp. in Oak Brook, Ill. In signing with Ace, Tim-BR-Marts joins other buying groups that are looking not only to expand their hardware assortments, but to gain access to more store programs. Homecare, Castle and AWARD already have agreements in place. Negotiations continue with BMR in Québec, but it has its own distribution, “so we’re trying to figure out a fit,” says Ingevaldson. “We’re very positive about that.” Ace currently ships to 101 stores in Canada that are either Ace stand-alone stores or sport the Ace name in association with another banner.
SUNBEAM CANADA UNAFFECTED AS PARENT FILES FOR CHAPTER 11 The Sunbeam Corp. filed for bankruptcy protection last week after a three-year effort to recover from an accounting scandal and a series of acquisitions that left it US$2.6 billion in debt. Sunbeam stock sold for US$0.51 at the time of its suspension; it had traded for as much as US$6 per share in March 2000. Sunbeam Canada remains unaffected by this turn of events, says Bruce MacDougall, who heads up the operation here. “Absolutely, it’s business as usual. Canada is not affected by the restructuring in the U.S.,” he says. “We have our own financing, so we’re not really even part of the chapter 11 in the U.S.” Product continues to be shipped and suppliers to be paid, he adds. As part of the U.S. reorganization plan, banks that made a combined commitment to lend US$1.7 billion have agreed to provide another US$285 million to let Sunbeam stay in business through debtor-in-possession financing, which gives the lenders first claim on a company's assets. Sunbeam's problems became apparent in 1998, when Albert (“Chainsaw Al”) Dunlap, a turnaround expert who was then the company's chief executive, was discovered to have artificially bolstered sales by getting retailers to accept more goods than they could possibly sell. Sunbeam was also struggling with a load of debt, including the US$1.7 billion bank loan it had taken on earlier that year after making three acquisitions.
COMPANIES IN THE NEWS Sears Canada released revenues for the four-week period ending January 27, 2001, posting a 9.9% increase to $482.8 million, from $439.4 million for the same period last year. Same-store sales were flat with last year. Adjusting for the same selling days, same store sales were up 3.7% compared with last year. LBMX has joined forces with two more retail groups, Castle Building Centres and Homecare Building Centres, to develop electronic trading communities. The online initiatives will focus on more efficient exchange of invoices and order placements between dealers, vendors and head office. Currently, 60% of Castle’s members are able to place orders electronically. Last month, LBMX announced similar agreements with Sexton Group and TruServ Canada. West Fraser Timber Co. has entered into an agreement to purchase Ainsworth Lumber's sawmill located at Chasm, BC, which includes 695,000 m3 of annual timber harvesting rights, for a net purchase price of $22 million plus working capital. The company, which recently purchased two sawmills in the southern U.S., also reported earnings of $144 million for the year on sales of $2.31 billion (versus 1999 sales of $2.20 billion). CGC Inc. will be the exclusive Canadian distributor of Trimroc Interior Mouldings, manufactured in Vaughan, ON by Canamould Extrusions Inc. They will be sold through the company’s existing customer base of retail and commercial dealers. Emco’s Building Products division has entered an alliance with Atlas Roofing Corporation of Meridian, Miss., with the purpose of producing non-laminate overlay architectural shingles for sale by both parties. Emco is investing in the modification of a roofing machine at the Atlas manufacturing facility in Quakertown, Penn. Camco announced a net income of $14.1 million for the twelve months ending Dec. 31, 2000 compared with $5.5 million for the same period in 1999. Sales were $697.2 million, compared with $638.3 million in 1999. Sales for the fourth quarter of $183.4 million were down slightly from 187.2 million in 1999. Net income for the fourth quarter was $4.4 million, compared with $1.2 million in 1999. Home Depot Inc. will expand its major appliance offering in 2001 through partnerships with General Electric Co. and Maytag Corp. The company plans to sell GE-branded air conditioners and to increase the number of models on the sales floors. Other aspects of the push include the addition of specially trained sales staff and enhanced product displays. Home Depot currently sells GE and Maytag home appliances instore and through web-based kiosks in the stores. Lowe's Cos. cut its fourth quarter earnings projection for the second time after unexpected promotional pricing before Christmas hurt earnings by US$0.04 a share. The company now expects to earn US$0.37 a share on a same-store sales decline in the middle of the 2% to 4% range. Earnings had been projected at US$0.40 to US$0.42 in early December 2000. For the fourth quarter ended Jan. 28, 2000, Lowe's earned US$148.9 million on sales of $3.8 billion. Sherwin-Williams Co. announced a fourth-quarter earnings fall of 17.5% to US$46.2 million, compared with US$56 million in the 1999 fourth quarter. Consumer segment net sales fell 2.5% to US$231.1 million. The company anticipates sales for the year to rise 1% to 3%, with 1% to 6% increases in the paint store, automotive and international coatings segments, while consumer segment sales will fall anywhere from 4% to 6%. Sherwin-Williams is reorganizing its consumer segment into wood products, aerosol and consumer paint divisions in an effort to cut costs and increase focus on distinctive product categories.
CANADIAN STOCK WATCH COMPANY 52-WEEK HIGH 52-WEEK LOW CLOSE (FRI.) Canadian Tire 37.35 15.10 21.00 Canfor 19.80 8.10 9.30 Goodfellow 12.55 8.50 9.60 Home Depot 70.00 34.68 46.89 Hudsons Bay 21.65 12.50 17.21 Lowe’s 67.25 34.25 53.84 Sears Canada 42.50 20.00 23.70 Taiga Forest 14.20 6.80 7.70 West Fraser 39.50 25.80 27.66
“Knowledge advances by steps, and not by leaps.” - Lord Macauley (1800-1859)
MARKET INDICATORS Municipalities issued $37.7 billion worth of building permits in 2000 says Stats Canada, the second highest ever performance in both residential and non-residential sectors. The 5.4% gain from 1999’s total was the fifth straight annual increase in overall construction intentions. Housing intentions were up 3.3%, totalling $20.6 billion. High levels of employment and low, stable mortgage rates contributed to the strong performance in planned residential projects, with a 5.2% increase or $15.0 billion total in permits issued for single-family dwellings. The value of non-residential permits was up 8.1% to $17.1 billion, with increases in industrial, commercial, and institutional components. This is the highest level reached in 11 years. Provincially, the most significant growth in 2000 occurred in Ontario, up 9% to $7.5 billion, and Alberta, up 22.3% to $2.5 billion. Strong demand for manufacturing plants, as well as a 33.4% increase in institutional intentions, played a key role in Ontario’s growth.
PEOPLE ON THE MOVE Penny Mauro has been promoted to director of marketing at Weiser Lock. She was formerly director of sales national accounts and has had over seven years of experience in the company. (604-419-4383)
OVERHEARD ... … “As an alternative to other distributors, we can provide other services; and with our North American volumes, we can provide pricing that keeps us extremely competitive.” - Paul Ingevaldson, vice-president, corporate strategy and international business for U.S.-based Ace Hardware Corp., on signing a supply agreement with Tim-BR-Marts Ltd.
* * * * *HARDLINES MARKETPLACE* * * *
Porter-Cable Delta, a recognized provider of quality woodworking products worldwide, currently requires an enthusiastic professional as Territory Sales Rep - Southwestern Ontario. A resourceful individual with the ability to organize and communicate successfully, you’ll be directing the operations for your territory and meeting strategic objectives. As a high achiever, you have three years’ field sales experience in the hardware industry, machinery knowledge, and computer literacy. You have a valid driver’s licence and a diploma/degree in Business. A background in power tools is desirable. If you are looking for a progressive organization and a competitive compensation package, please fax your resume to Human Resources, (519) 836 9352, or mail to 505 Southgate Drive, P.O. Box 848, Guelph, Ontario, N1H 6M7 We thank all applicants in advance and advice that only candidates selected for an interview will be contacted.
DURING THIS YEAR’S CHS … VISIT BOOTH # 3945 to view K & D Products’ new STURDY-STEP product line. New to Canada, the STURDY-STEP is ideal for any number of business, professional or Do-It-Yourself applications. With a 22" work platform that holds up to 350 lb. and a top step that is 15½“ high, the STURDY-STEP is the ideal companion for the hard to reach areas. For further information contact: Pat Smith at 1-866-791-0281; or email at patrickrsmith@home.com. Visit our website at www.sturdy-step.com.
WANT THE BIG PICTURE? THEN GET OVER TO the Cologne International Hardware Fair/DIY’TEC:Contact Trade Show Travel by phone (877-873-7469) or fax (403-247-2448) or to arrange your trip. BOOK EARLY! Packages include return airfare and accommodations, as well as admission to the Exhibition. And don’t forget the Canada Night Reception sponsored by Hardlines and Cologne International Trade Shows! We’ll see you in Cologne.Over 3,800 suppliers from 57 countries are expected in three trade fair theme areas: The World Tools Centre, Security Systems Locks and Fittings, and DIY’TEC. The Hardware sector will occupy the entire exhibition space at KolnMesse - that is over 3 million sq.ft. of hardware and building supplies!
THE HARDLINES MARKETPLACE: just $16 per line. Contact Eugenia at 416.489.3396 or email: buzz@hardlinesfax.com
HARDLINES WHO’S WHO 2000-2001 EDITION: The only annual guide to Canada’s leading hardware and home improvement retailers, wholesalers, buying groups, mass merchants and co-ops. The Who’s Who lists more than 100 companies, with executives, product categories, sales, number of outlets, buyers, etc. The cost is only $125 for subscribers, or $165 for non-subscribers (+GST/HST). "THE HARDLINES INDUSTRY REPORT: Home Improvement Retailing in Canada” is a comprehensive overview of the size of the market, how many stores are out there, who the key players are, their market position, the size and growth of the big boxes, the trends in housing and renovations, market trends - and much, much more! 120-plus pages filled with charts, graphs and photos. Regular price: $945, only $750 for subscribers. Order by February 6, 2001, and SAVE $55 off our regular price! You can order both these incredible books online: https://www.securewebsite.net/~hardline/order.html or contact Nancy Wright at nancy@hardlinesfax.com; phone: 416-489-3396 for more information.
HARDLINES™ the electronic newsletter hardlines.ca Phone: 416.489.3396; Fax: 416.489.6154 Michael McLarney, Editor & Publisher: mike@hardlinesfax.com Eugenia Canas, Assistant Editor: buzz@hardlinesfax.com Beverly Allen, Marketing Manager: bev@hardlinesfax.com Nancy Wright, Circulation Manager: nancy@hardlinesfax.com Hardlines is published weekly (except monthly in December and August) by McLARNEYCOM 542 Mount Pleasant Rd., Suite 302, Toronto, Ontario, Canada M4S 2M7 © 2001 by Michael McLarney.
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