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| ...The Spring issue of Hardlines Quarterly Report features: The Three Billion Dollar Club - find out which home improvement retailers dominate the Canadian scene...Who's winning the big box war? Big box expansion in Canada..... CLICK HERE to find out more! |
| RESTRUCTURING AFFECTS SODISCO-HOWDEN'S BOTTOM LINE |
| Montréal, QC - Sales were up for Sodisco-Howden Group in its first quarter, while the bottom line took a hit due to costs of restructuring and buying another company's business.
SHG had revenues of $86.6 million for the first quarter, up 19% over the same period a year earlier, due largely to the acquisition of the hardware and building materials business of Marchands Unis, and the strong performance of the LBM sector. Combined with integration costs of $1.8 million for the acquisition of Marchands Unis, the company recorded a net loss of $2.8 million in the first three months of the year.
However, the quarter also marked a transition period, during which SHG made a number of aggressive moves to streamline operations and reduce costs.
According to Jos Wintermans, president and CEO of SHG, the costs of the Marchands Unis acquisition are reflected in the 1Q results, but the benefits of added sales to these dealers will not emerge until later quarters. Hence the hit on the bottom line. However, he expects revenues to increase by as much as 20%, thanks to the new business. "I'm very confident of that and expect to see it in future quarters."
Wintermans also points to the costs of consolidating the buying offices of its two divisions in Victoriaville, QC and London, ON. All decisions are now being made in Montréal, a move that was completed at the end of March. Again, the costs impact 1Q, "but I think the reorganization will make a great impact on the bottom line in the future," he says. The impact will come not just from lower operating costs, but from a better negotiating position for the company's combined divisions. "If you're a Sodisco-Howden vendor, you're now sitting across from a buyer who's responsible for the whole national picture. So now you're in a position to grow your market share with an organization that's really growing." |
| CANADIAN TIRE RETAIL UP 9.4%, MORE TALK OF U.S. EXPANSION |
| Toronto, ON - First-quarter profits for Canadian Tire Corp. rose 5.5% year-over-year to $30.3 million, as sales increased 11.1% to $1.24 billion, compared with $1.12 billion a year earlier.
The positive results were driven in part by strong sales at Canadian Tire retail stores, which grew 9.4% to $989 million from $903.9 million. Same-store sales were up 5.8%. Growth was especially strong in core categories such as hardware, automotive and sporting goods. The increase does not include sales by Mark's Work Wearhouse, which CTC bought in February 2002. Average sales by traditional stores in the first quarter were $8.3 million per year on an annualized basis; new-format stores had sales of $14.8 million on an annualized basis.
The company's profit picture was enhanced by the retail division, which had an increase of 4.5% in gross operating revenue to $884 million, driven by a similar increase in shipments to dealers. While increases are harder to gauge because of the acquisition of Mark's Work Wearhouse and by one-time gains from the sale of Hamilton Discount, its credit card arm, in the first quarter of last year, the company said net profit was up 27% year-over-year.
Speaking at its annual general meeting last Thursday, CTC president and CEO Wayne Sales reiterated the company's interest in continuing its expansion into new categories and geographic markets. The Mark's acquisition and the expansion of its car wash business are recent examples. But Sales also spoke about U.S. expansion or acquisition. (Old news, of course, for anyone attending last year's Hardlines Marketing Conference, where Canadian Tire Retail president Mark Foote talked about the very same thing - Editor).
The company opened four new-format stores in the first quarter, for a total 451 outlets, 274 of them new-format, and plans to open another 18 this year. It ultimately wants to increase its store count by 40-50 for a total of 480 to 490 by the end of 2005, with 350-370 of them larger, revamped new-format stores. CTC also wants to increase its revenue by 10% a year and earnings by 10-15%.
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| CHS SEEKS TO ENHANCE BUYING FOCUS |
| TORONTO - The Canadian Retail Hardware Association met recently with retail and manufacturers' groups to examine the challenges facing its Canadian Hardware and Building Materials Show.
The panel included representatives from Castle Building Centres, Homecare Building Centres, Home Hardware, ILDC, RONA Ontario Inc., Spancan, and the Canadian Hardware and Housewares Manufacturers Association. Talks also included the CRHA's affiliated show sponsors, the Lumber and Building Materials Association of Ontario and the Paint and Decorating Retailers Association.
The show is undertaking lots of research to understand the needs of both delegates and exhibitors. But one prominent trend was the need to emphasize the role of CHS as a buying show.
Other initiatives developed from the meeting included keeping booth rates unchanged, creation of buying incentives such as discounts, terms, rebates, volume discounts and introductory offers by vendors, and special attention to good booth location for new exhibitors.
CHS also intends to work more closely with vendors, buying groups and dealers to develop product knowledge opportunities for store staff.
CHS 2003 will be held February 2-4 at The National Trade Centre in Toronto. For more information, visit www.crha.com or contact Joe Edwards, show manager at 905-821-3470; fax: 905-821-8946; or e-mail: crha@crha.com.
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| COMPANY |
52-WEEK HIGH |
52-WEEK LOW |
CLOSE (FRI.) |
| Canadian Tire |
31.85 |
18.50 |
30.85 |
| Canfor |
12.60 |
8.08 |
9.95 |
| Emco |
12.09 |
3.35 |
11.00 |
| Goodfellow |
11.90 |
8.00 |
11.00 |
| Home Depot |
53.73 |
30.30 |
45.50 |
| Hudson's Bay |
20.10 |
12.50 |
13.55 |
| Lowe's Cos. |
48.88 |
24.99 |
41.80 |
| Sears Canada |
25.00 |
12.50 |
23.50 |
| Sodisco-Howden |
2.63 |
0.75 |
1.84 |
| Taiga Forest |
12.75 |
7.40 |
12.00 |
| West Fraser |
44.42 |
26.13 |
40.99 |
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| COMPANIES IN THE NEWS |
| Rona Lansing reopened its Markham, ON store on Saturday with an expanded facility. The size has almost doubled to 30,000 sq.ft., while inventory has been increased by 25%.
At their contractor appreciation event, or "Pro Show," held in Ottawa, Home Hardware stores there benefitted from $20,000 in hockey tickets, courtesy of the Ottawa Senators hockey team. In addition, the Ottawa-area dealers ran advertising in the Senators' fan magazine, which ended up garnering orders for about 20 home packages.
Kent Building Supplies had a grand opening celebration on May 4 weekend for its Mt. Pearl big box store, its second in St. John's, NF. The 130,000-sq.ft. site appears more female-oriented, with a distinct emphasis on certain categories, especially an expanded lighting department and more vignettes devoted to kitchens and bath. The store had a soft opening in the middle of March.
Total revenues for Sears Canada in April increased 2.5% to $506.2 million, from $494.0 million for the same period last year. Merchandise sales increased by 3.9% in the month. Same store sales in retail stores decreased 1.5%.
TruServ Corp. in the U.S. reported a profit for its fiscal year ended March 30 of US$4.6 million, up from a loss of US$13.9 million a year earlier. However, going into 2002, 1Q sales were down 15.5% to US$553.2 million, from US$654.3 million a year ago.
Home Depot in the U.S. will try making its own appliance deliveries instead of outsourcing the service. According to Chain Store Age, the company will open a 40,000-50,000-sq.ft. distribution centre to handle the deliveries. |
| PEOPLE ON THE MOVE |
| Edel Wichmann, manager of the Canadian office for Cologne International Trade Shows, has retired after 20 years. Edel was a indefatigable promoter of the world's largest hardware show, held every March in Cologne, Germany, and has been a loyal supporter of Hardlines and our events through the years … She has been replaced by Barbara Hills, who was formerly with Lufthansa in Toronto for many years, before joining with Cologne. (416-598-3343)
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| MARKET INDICATORS |
| The New Housing Price Index rose 0.4% in March and stands 3.3% higher than March 2001. March's increase was the highest year-over-year increase since May 1990. Monthly advances occurred in 10 of the 21 urban centres surveyed. The largest advance was in Edmonton (+1.1%), due to high demand and increased material and labour costs. Calgary and Montréal followed closely with increases of 1.0% and 0.9% respectively.
Housing starts in Canada decreased 11.3% in April to 184,500 units seasonally adjusted, from 208,000 units in March, according to CMHC. Urban singles declined 6.4% to 96,600 units in April to an annual rate of 96,600 units in April from 103,200 in March while urban multiple starts were down 17.7% to an annual rate of 62,000 units from 75,300. Rural starts, estimated at a seasonally adjusted annual rate of 25,900 units in April, were down from a revised 29,500 units in March. While seasonally adjusted starts are down after a record high March, actual starts are 25.2% higher than April 2001.
The value of residential building permits was down slightly in March. Contractors took out $2.4 billion in permits for housing in March, down 1.2% from a record high in February. However, it's still up a whopping 30% for the first quarter of the year, compared with the same period a year ago. Housing permits reached $7.2 billion for the first three months of 2002. Nearly 53,000 new dwellings were authorized from January to March, the highest quarterly level since the first quarter of 1990. Three-quarters of that activity was in single-family unit intentions.
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| NOTED... |
| I'm delighted to report that our Meet the Buyers Breakfast Seminar is not only a sold-out event, but it's truly international. We've got vendors from the U.S. and even the U.K. registered! We're examining the possibility of doing this in other cities. Montréal is already being planned and I'd love to hear if anyone would be interested in one out West. Let me know! - Michael |
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****HARDLINES MARKETPLACE****
Check out Hardlines Classifieds on the web:
https://hardlines.ca/html/classifieds_new.asp
HELP WANTEDREGIONAL SALES MANAGER
Moen Inc.
, Canada's leading supplier of faucets, plumbing parts and accessories, seeks a passionate sales leader for their Montréal office.The successful bilingual candidate will build upon strong relationships with major and national retail accounts — developing and implementing comprehensive strategies to provide superior service and support. Leading a group of dedicated sales professionals, the Québec manager actively participates in all facets of the business including sales development, program presentation, category management, promotions, and budget planning.
Key requirements for this position include:
- a minimum of 6 years in a regional sales management role
- a passion for sales development and growth
- a proven ability to coach and build teams with a strong customer service focus
- a well developed network in the hardware retail industry in Quebec
- knowledge of category management initiatives and national account management
- a track record of superior performance in retail account management
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The bilingual candidate will have superior business planning and presentation skills, and will enjoy a team environment. Candidates should possess a post-secondary education, computer literacy, and corporate reporting experience.
This position offers an attractive salary and sales incentives, a benefits package and more.
For those people interested in moving their careers forward, we invite you to explore this opportunity further by contacting Danek Anthony Inc. Please contact by phone or email: Don Dominczuk, 416/214-9938 or dondomin@uniserve.com ; Tom Carroll, 416/259-4994 or carroll4994@rogers.com
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BUSINESS OPPORTUNITIES
MERGER OPPORTUNITY
It's time to grow our business. We are a leading national manufacturers' rep agency with major manufacturer clients. We're looking for a merger with an existing Ontario agency. We can reach critical mass with the right partner.
If your current lines are the right fit with ours, we can grow together. Reply in strictest confidence to Box 350, Hardlines, c/o bev@hardlines.ca. (Put "Box 350" in subject line.)
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SALES AGENTS, REPS WANTED
Canadian custom manufacturer of unique home address plaques is looking for a sales agency (or agencies) to increase its Canadian and US exposure. Our products are best positioned in specialty hardware and lighting retailers that offer unique quality products.
For more information, please write to PO Box 5821, Station A, Calgary, Alberta T2H 1Y3 or phone 403-253-1865; fax 403-253-4788.
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PREQ. REBATES, GMROI, FOIDS - these are powerful concepts in your work. Asset allocation, diversification, Sharpe ratio - and these are key concepts in investing your money to "retire in style."
Call or email me to arrange a confidential portfolio review and see how we can work together to grow your hard-earned savings to "higher plateaus." Mark Flor, BEng., MBA - Investment Advisor, BMO Nesbitt Burns Inc. (member CIPF), Tel. 416-359-7649, Email: mark.flor@nbpcd.com
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AGENTS, REPS WANTED
W. H. Maze Company, (Maze Nails). This Illinois based manufacturer of specialty nails is seeking a sales agency in Canada. Targeted markets for Maze Nails include lumber yards, building contractors and the manufactured housing industry. Tom Koch, Vice President of Sales & Marketing for Maze Nails, will be in the Toronto vicinity for business appointments the week of May 13th, 2002. He will also be attending the "Meet the Buyers Breakfast Seminar", sponsored by HARDLINES on May 15th.
You can learn more about Maze Nails by visiting their website at www.mazenails.com. If you would like to meet with Mr. Koch, please contact Jeffrey Johnson of the State of Illinois Canada Office at (416) 695-9888. The email address is illinois@iltrade.toronto.on.ca .
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Don’t leave your products’ display management
to chance! Let Noral Instore take care
of your instore merchandising.
Visit http://www.noralmarketing.com
or call Al Vanderveen at 519-439-6800 ext. 201
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SELL YOUR COMPANY - OR BUY ONE - WITH HARDLINES CLASSIFIEDS!
DO YOUR EXECUTIVE SEARCH, FIND NEW LINES OR GET NEW REPS IN THE HARDLINES MARKETPLACE.
ONLY $18 PER LINE FOR THREE WEEKS!
TO PLACE YOUR AD, CALL US AT 416-489-3396 OR EMAIL: bev@hardlines.ca |
