Canada’s electronic news service for the home improvement industry
February 19, 2001
Volume vii, #7
Michael McLarney, Editor & Publisher
Phone: 416.489.3396
Fax: 416.489.6154
email: mike@hardlinesfax.comhardlines.ca
* * * * * *
IN THIS ISSUE:
- Totem Building Supplies joins ILDC
- Canadians access world market at Cologne Fair
- Canadian Tire shows strong presence in seasonal
- Construction industry upbeat on year ahead
- Atlantic show adds McKenna to speakers’ roster
* * * * *
Major West independent Totem Building Supplies joins ILDC
One of Tim-Br-Mart’s key members, Totem Building Supplies, has joined ILDC. Andrew Battagliotti, general manager of ILDC, confirmed this agreement, effective February 16. “They are a major player in Alberta,” Battagliotti said, “and we are very pleased to have them join us as this will strengthen ILDC’s position in Western Canada.” Details will be released early next week.
Totem, which counts with 11 retail and contractor stores and $150 million in sales, has proven a model of the successful medium sized retailer offering an alternative to the big box format.
ILDC is comprised of 21of Canada’s largest independent home improvement chains with a total of 186 outlets from coast to coast. Its members represent regional guys who do not compete directly with one another. Up to now, ILDC’s only player in the West, and the largest ILDC member based on sales numbers, is Revy. But the announced intention of parent company West Fraser to sell off Revy could result in it being merged with another player, which would remove it from the ILDC group.
The initiative to have Totem join the ILDC buying group represents a significant step in mitigating sales losses which could result from Revy’s absence as an ILDC member.
______________________________________________
Canadian exporters pursue international markets in Cologne
Canadian companies are once again using the International Hardware Fair/DIY'TEC in Cologne, Germany, to showcase their products to an international marketplace. The Cologne fair, running until February 21, features group exhibitors from Canada's tool sector as well as individual exhibitors in the DIY and home improvement categories.
“Canadians have had a strong presence at the fair for well over twenty years," says Edel Wichmann, manager for Cologne International Trade Shows in Canada. “There are companies that have been attending for a long time, and continue to come back. This inclusion of the Fair in their marketing strategies has resulted in great success for them.”
Among the long-time exhibitors are SPG International, maker of toolboxes and storage units, and The G.H. Company, a producer of driveway, roofing, and waterproofing materials. Other individual exhibitors run the gamut from manufacturers of professional hand tools to producers of water treatment, purifying devices and UV filtration systems for commercial and light industrial uses.
Group exhibitors in the tool section of the Fair are showing under sponsorship of the Canadian Department of Foreign Affairs and International Trade (RENA). Companies featured here include GRK Canada Ltd., M.A.C. Board Inc., and Vancouver Tool Corp.
______________________________________________
Canadian Tire breaks out sales
Canadian Tire has recently released a breakdown of its retail divisions, showing strong growth in leisure and sporting goods. Hardware sales, on the other hand, remain flat.
In 1999, Canadian Tire had 436 associate dealers, generating $4.73 billion in retail sales. Of that, 42.5%, or $2.0 billion, came from its hardware category. CTC’s leisure category, which includes sporting goods and seasonal products, had sales of $1.4 billion, up 16.9% from 1998. Automotive was next, at $1.3 billion.
______________________________________________
Former N.B. premier will speak at Atlantic Show
Frank McKenna, former premier of New Brunswick, will kick off the Atlantic Building Materials Show with a keynote speech on March 24. The kickoff, a first for the show, is intended to boost attendance on the Friday of the event, which runs until Sunday, March 26, in Moncton, NB. The show will open at 9:30 a.m., half an hour later than in the past, to accommodate McKenna’s presentation.
McKenna spent 10 years as premier of the province, and now serves on several boards, including General Motors.
Another new addition to the show’s speaker program is John Brill, president of the Northeastern Retail Lumbermen’s Association. He will speak on Sunday morning, March 26.
______________________________________________
Housing starts begin the year on a strong note
The annual rate of housing starts in Canada increased 20.1% in January 2001, relative to December 2000 numbers. All provinces recorded increases with the exception of Newfoundland and Prince Edward Island. Most of the gains occurred in large metropolitan areas, with Toronto, Vancouver and Montréal leading the way. Urban singles starts inched up with a 5.8% increase; multiple starts were up 48.3%. Most notably, multiple housing and condominium activity in Québec’s urban centres recorded a 57% increase.
In 2000, housing starts in Ontario hit an 11-year high, bolstered mainly by high rates of employment and better-than-average economic performance.
According to CMHC’s National Housing Outlook, apartments will account for approximately 50% of the rise in multiple housing starts; this is triggered by the low rental vacancy rates currently experienced. Construction of condominiums will also increase and will aid in meeting the demand for rental housing. CHMC’s forecasts are supported by the latest Stats Canada numbers on building permits, which are up 3.5%.
As reported in the Hardlines Quarterly Report (Winter 2001), housing starts have been key to the increase in construction. According to the Canadian Construction Association, gross construction output is expected to increase by over 4% to $124.3 billion in 2001.
______________________________________________
COMPANIES IN THE NEWS
Rona will open a $20 million new generation big-box-store in Kingston, ON, in early 2002. All zoning and site plans have been finalized. The 150,000-sq.ft. store will be located near Cataraqui Mall and will feature specialty boutiques, an indoor lumberyard, a greenhouse and a garden centre. The first new generation store is scheduled to open in Brampton, ON in the first or second week of March.
Ainsworth Lumber Co. Ltd. has closed the $52 million bridge loan facility with HSBC Capital (Canada) Inc. and B.C. Pacific Capital Corporation. Proceeds from the financing will be used to complete the construction of Ainsworth’s 50% interest in the Footner OSB facility located in High Level, AB.
International Forest Products Limited has been accepted by the TSE to make a second normal course issuer bid for its Class A Subordinate Voting Shares. The company believes that current market conditions provide opportunities for Interfor to acquire shares at attractive prices and that the purchases will enhance shareholder value.
For its first quarter ended December 31, 2000, Nu-Gro announced sales of $24.1 million, compared with $19.9 million for the same period in 1999. Earnings are lower this year due to reduced profit margins in the fertilizer raw material segment, as well as expenses associated with the acquisition of two businesses, ProTurf and Pursell Vigoro.
Do It Best Corp. in the U.S. has entered into partnership with the developer of the Floor To Ceiling franchise, MRM Inc., with the purpose of expanding the selection of home décor products available to Do It Best members. New purchasing programs will be rolled out as they become available.
Newell Rubbermaid Inc.’s net income fell 23% in the fourth quarter. Net sales dipped to US$1.76 billion from US$1.77 billion a year ago. Earnings in 2001 are expected to be below analysts' estimates. Joseph Galli Jr., president and CEO, said the company will try to fund increased marketing by redeploying costs and also launch a new product development process.
______________________________________________
CANADIAN STOCK WATCH
______________________________________________
“Imagination is more important than knowledge.”
– Albert Einstein
______________________________________________
MARKET INDICATORS
Consumers paid 3% more in January than they did in January 2000 for the goods and services included in the Consumer Price Index basket. Energy prices went up an average of 10.4% during this period. Among the other important factors contributing to the 12-month increase in all-items CPI in January were mortgage interest cost, meat, food purchased from restaurants and traveller accommodation. However, the drop in prices for the purchase of automotive vehicles, computer equipment and supplies, as well as child care, partly offset this increase.
The CPI declined by 0.3% from December to January. Lower prices for the purchase of automotive vehicles, natural gas, travel tours and gasoline were the largest contributors to the drop.
______________________________________________
PEOPLE ON THE MOVE
Hudson's Bay Company has appointed Michael Rousseau executive vice president and COO. Mr Rousseau will join the company on March 5, 2001; he succeeds Gary Lukassen. (416-861-4720)
______________________________________________
NOTED …
… Federal Reserve Chairman Alan Greenspan stressed that the chances of the U.S. economy sinking into a recession were low. Testifying before the Senate Banking Committee, Greenspan said: “In the event, and it is a low probability event, that we not only go into a recession but stay there for an extended period of time, it is better to have had lower taxes than otherwise.
“In short, it would be an insurance,'' Greenspan added. ''Insurance against a
low-probability event, which indeed is what insurance is really about.''
______________________________________________
* * * * *HARDLINES MARKETPLACE* * * *
______________________________________________
Master Lock, the world leader in padlock and related security products is seeking a Territory Manager, Ontario -- Commercial ready to prove they have what it takes to increase sales and distribution, thus expanding our market leading position.
We are looking for a results driven, high achiever who understands what it takes to drive customer satisfaction. This individual is very organized, computer literate, and supports the team approach. Responsibilities will include, but are not limited to, sales, service and market development of all Master Lock product lines in the industrial, locksmith and locker lock channels of trade.
This position reports to the Commercial Business Unit Manager, Canada. We offer a competitive salary, bonus, automobile and full benefits. Candidates qualified for this position should send their resume in the strictest confidence to Debbie Molignano at our Oakville office. E-mail: dmolignano@mlock.com, or fax 905 829-5165.
Canada’s electronic news service for the home improvement industry
February 19, 2001
Volume vii, #7
Michael McLarney, Editor & Publisher
Phone: 416.489.3396
Fax: 416.489.6154
email: mike@hardlinesfax.comhardlines.ca
* * * * * *
IN THIS ISSUE:
- Totem Building Supplies joins ILDC
- Canadians access world market at Cologne Fair
- Canadian Tire shows strong presence in seasonal
- Construction industry upbeat on year ahead
- Atlantic show adds McKenna to speakers’ roster
* * * * *
Major West independent Totem Building Supplies joins ILDC
One of Tim-Br-Mart’s key members, Totem Building Supplies, has joined ILDC. Andrew Battagliotti, general manager of ILDC, confirmed this agreement, effective February 16. “They are a major player in Alberta,” Battagliotti said, “and we are very pleased to have them join us as this will strengthen ILDC’s position in Western Canada.” Details will be released early next week.
Totem, which counts with 11 retail and contractor stores and $150 million in sales, has proven a model of the successful medium sized retailer offering an alternative to the big box format.
ILDC is comprised of 21of Canada’s largest independent home improvement chains with a total of 186 outlets from coast to coast. Its members represent regional guys who do not compete directly with one another. Up to now, ILDC’s only player in the West, and the largest ILDC member based on sales numbers, is Revy. But the announced intention of parent company West Fraser to sell off Revy could result in it being merged with another player, which would remove it from the ILDC group.
The initiative to have Totem join the ILDC buying group represents a significant step in mitigating sales losses which could result from Revy’s absence as an ILDC member.
______________________________________________
Canadian exporters pursue international markets in Cologne
Canadian companies are once again using the International Hardware Fair/DIY'TEC in Cologne, Germany, to showcase their products to an international marketplace. The Cologne fair, running until February 21, features group exhibitors from Canada's tool sector as well as individual exhibitors in the DIY and home improvement categories.
“Canadians have had a strong presence at the fair for well over twenty years," says Edel Wichmann, manager for Cologne International Trade Shows in Canada. “There are companies that have been attending for a long time, and continue to come back. This inclusion of the Fair in their marketing strategies has resulted in great success for them.”
Among the long-time exhibitors are SPG International, maker of toolboxes and storage units, and The G.H. Company, a producer of driveway, roofing, and waterproofing materials. Other individual exhibitors run the gamut from manufacturers of professional hand tools to producers of water treatment, purifying devices and UV filtration systems for commercial and light industrial uses.
Group exhibitors in the tool section of the Fair are showing under sponsorship of the Canadian Department of Foreign Affairs and International Trade (RENA). Companies featured here include GRK Canada Ltd., M.A.C. Board Inc., and Vancouver Tool Corp.
______________________________________________
Canadian Tire breaks out sales
Canadian Tire has recently released a breakdown of its retail divisions, showing strong growth in leisure and sporting goods. Hardware sales, on the other hand, remain flat.
In 1999, Canadian Tire had 436 associate dealers, generating $4.73 billion in retail sales. Of that, 42.5%, or $2.0 billion, came from its hardware category. CTC’s leisure category, which includes sporting goods and seasonal products, had sales of $1.4 billion, up 16.9% from 1998. Automotive was next, at $1.3 billion.
______________________________________________
Former N.B. premier will speak at Atlantic Show
Frank McKenna, former premier of New Brunswick, will kick off the Atlantic Building Materials Show with a keynote speech on March 24. The kickoff, a first for the show, is intended to boost attendance on the Friday of the event, which runs until Sunday, March 26, in Moncton, NB. The show will open at 9:30 a.m., half an hour later than in the past, to accommodate McKenna’s presentation.
McKenna spent 10 years as premier of the province, and now serves on several boards, including General Motors.
Another new addition to the show’s speaker program is John Brill, president of the Northeastern Retail Lumbermen’s Association. He will speak on Sunday morning, March 26.
______________________________________________
Housing starts begin the year on a strong note
The annual rate of housing starts in Canada increased 20.1% in January 2001, relative to December 2000 numbers. All provinces recorded increases with the exception of Newfoundland and Prince Edward Island. Most of the gains occurred in large metropolitan areas, with Toronto, Vancouver and Montréal leading the way. Urban singles starts inched up with a 5.8% increase; multiple starts were up 48.3%. Most notably, multiple housing and condominium activity in Québec’s urban centres recorded a 57% increase.
In 2000, housing starts in Ontario hit an 11-year high, bolstered mainly by high rates of employment and better-than-average economic performance.
According to CMHC’s National Housing Outlook, apartments will account for approximately 50% of the rise in multiple housing starts; this is triggered by the low rental vacancy rates currently experienced. Construction of condominiums will also increase and will aid in meeting the demand for rental housing. CHMC’s forecasts are supported by the latest Stats Canada numbers on building permits, which are up 3.5%.
As reported in the Hardlines Quarterly Report (Winter 2001), housing starts have been key to the increase in construction. According to the Canadian Construction Association, gross construction output is expected to increase by over 4% to $124.3 billion in 2001.
______________________________________________
COMPANIES IN THE NEWS
Rona will open a $20 million new generation big-box-store in Kingston, ON, in early 2002. All zoning and site plans have been finalized. The 150,000-sq.ft. store will be located near Cataraqui Mall and will feature specialty boutiques, an indoor lumberyard, a greenhouse and a garden centre. The first new generation store is scheduled to open in Brampton, ON in the first or second week of March.
Ainsworth Lumber Co. Ltd. has closed the $52 million bridge loan facility with HSBC Capital (Canada) Inc. and B.C. Pacific Capital Corporation. Proceeds from the financing will be used to complete the construction of Ainsworth’s 50% interest in the Footner OSB facility located in High Level, AB.
International Forest Products Limited has been accepted by the TSE to make a second normal course issuer bid for its Class A Subordinate Voting Shares. The company believes that current market conditions provide opportunities for Interfor to acquire shares at attractive prices and that the purchases will enhance shareholder value.
For its first quarter ended December 31, 2000, Nu-Gro announced sales of $24.1 million, compared with $19.9 million for the same period in 1999. Earnings are lower this year due to reduced profit margins in the fertilizer raw material segment, as well as expenses associated with the acquisition of two businesses, ProTurf and Pursell Vigoro.
Do It Best Corp. in the U.S. has entered into partnership with the developer of the Floor To Ceiling franchise, MRM Inc., with the purpose of expanding the selection of home décor products available to Do It Best members. New purchasing programs will be rolled out as they become available.
Newell Rubbermaid Inc.’s net income fell 23% in the fourth quarter. Net sales dipped to US$1.76 billion from US$1.77 billion a year ago. Earnings in 2001 are expected to be below analysts' estimates. Joseph Galli Jr., president and CEO, said the company will try to fund increased marketing by redeploying costs and also launch a new product development process.
______________________________________________
CANADIAN STOCK WATCH
______________________________________________
“Imagination is more important than knowledge.”
– Albert Einstein
______________________________________________
MARKET INDICATORS
Consumers paid 3% more in January than they did in January 2000 for the goods and services included in the Consumer Price Index basket. Energy prices went up an average of 10.4% during this period. Among the other important factors contributing to the 12-month increase in all-items CPI in January were mortgage interest cost, meat, food purchased from restaurants and traveller accommodation. However, the drop in prices for the purchase of automotive vehicles, computer equipment and supplies, as well as child care, partly offset this increase.
The CPI declined by 0.3% from December to January. Lower prices for the purchase of automotive vehicles, natural gas, travel tours and gasoline were the largest contributors to the drop.
______________________________________________
PEOPLE ON THE MOVE
Hudson's Bay Company has appointed Michael Rousseau executive vice president and COO. Mr Rousseau will join the company on March 5, 2001; he succeeds Gary Lukassen. (416-861-4720)
______________________________________________
NOTED …
… Federal Reserve Chairman Alan Greenspan stressed that the chances of the U.S. economy sinking into a recession were low. Testifying before the Senate Banking Committee, Greenspan said: “In the event, and it is a low probability event, that we not only go into a recession but stay there for an extended period of time, it is better to have had lower taxes than otherwise.
“In short, it would be an insurance,'' Greenspan added. ''Insurance against a
low-probability event, which indeed is what insurance is really about.''
______________________________________________
* * * * *HARDLINES MARKETPLACE* * * *
______________________________________________
Master Lock, the world leader in padlock and related security products is seeking a Territory Manager, Ontario -- Commercial ready to prove they have what it takes to increase sales and distribution, thus expanding our market leading position.
We are looking for a results driven, high achiever who understands what it takes to drive customer satisfaction. This individual is very organized, computer literate, and supports the team approach. Responsibilities will include, but are not limited to, sales, service and market development of all Master Lock product lines in the industrial, locksmith and locker lock channels of trade.
This position reports to the Commercial Business Unit Manager, Canada. We offer a competitive salary, bonus, automobile and full benefits. Candidates qualified for this position should send their resume in the strictest confidence to Debbie Molignano at our Oakville office. E-mail: dmolignano@mlock.com, or fax 905 829-5165.