Hardware Show flourishes in Orlando

ORLANDO, Fla. — Healthy traffic and more exhibitors of national brands indicate that the National Hardware Show has weathered a one-time move from Las Vegas to this central-Florida city. More than 3,400 exhibitors converged on the Orange County Convention Center, attracting dealers, buyers and reps from all over the U.S., as well as Mexico and Canada. After only two years at a new location in Las Vegas, the show was forced to move to Orlando, due to space requirements. (Next year it will return to the Las Vegas Convention Center and Sands Expo Convention Center, May 6-8.) "We are really pleased with two things," says Dennis MacDonald, vp of Reed Exhibitions, which owns the show. "We were able to pull from the South and Southeastern States, more than we did in Las Vegas. And among our pre-registrations, 73% are brand new, so the vendors will get to see new dealers."¬‚ Despite the new locale, or perhaps because of it, Canada was well represented at the show, with buyers from major retail groups, such as Canadian Tire, Home Depot, Home Hardware, Federated Co-op, BMR, UFA, Peavey, and PRO Retail Services, all in attendance. One group that was noticeably absent was RONA, which failed to send any buyers this year, even though that retailer has been strongly represented in the past. While some detractors criticize the show for its lack of major brand vendors, some are, in fact, beginning to return. 3M had a giant booth, while companies such as Arrow Fastener, Channellock, Danaher Tool, ICI Paints, and Red Devil were all present. Dorel, the Montreal-based company that represents a range of brands in different channels, was front and centre at NHS with its Cosco brand of products. One major brand that did come back — albeit at the last minute — was Bosch. The giant toolmaker determined that it would meet customers at the show, but was unable to obtain booth space only days before the show was to open. The company negotiated with the show's organizers to have a private room onsite at the convention centre. There, it displayed a range of new products and held private meetings with buyers. Among the new products being showcased, three trends emerged. Products that were "green" — either manufactured to environmentally friendly specifications or which help consumers be more eco-friendly themselves — were being touted everywhere. Storage and organization was another trend in evidence, with everything from space-saving cabinetry and racking to electrically powered hoists that raise racks and bicycles up out of the way. Third, new innovations spurred by technological advances surfaced in security products, power tools, kitchen wares, and landscape accessories.

↑ top

Canac-Marquis quits ILDC

ANCIENNE-LORETTE, Que. — Canada's most exclusive buying group has made an extraordinary move by agreeing to the departure of one of its members. Independent Lumber Dealers Co-operative (ILDC) has parted ways with one of its largest members, Canac-Marquis Grenier. ILDC has fewer than two dozen members, yet these members, who include giants like Kent, with 30 stores in Atlantic Canada, and Copp Building Materials, which has four in London, Ont., has about 140 points of sale across Canada. Canac-Marquis, which is based here and has 14 outlets throughout Quebec — plus one hardware store in Trois-Rivières — has estimated sales in excess of $250 million, according to the Hardlines Who's Who Directory. The expansion by Canac-Marquis into new markets in Quebec may have contributed to its departure. ILDC has always been strongly represented in that province, where it has eight members besides Canac-Marquis. Its members have always respected geographic boundaries, making sure to stay out of each other's markets. But some Canac-Marquis stores land squarely in the marketplaces of other ILDC members. For example, the one in Chicoutimi competes with a Potvin et Bouchard store, and its hardware store in Trois Rivières is in the environs of one of Patrick Morin's outlets. Andrew Battagliotti, general manager of ILDC, would not comment on the reasons for the split, except to say that Canac-Marquis "have been good members of ILDC since 1986, with long-term participation in the co-op. However, it reached a point where their goals and strategies differed with those of ILDC, so their board and our board agreed that it was time to split."

↑ top

RONA's 1Q results fall short of expectations

BOUCHERVILLE, Que. — Poor weather and a slowdown in the housing markets in Quebec and Ontario were cited as the main factors contributing to a 4.1% decrease in RONA's first-quarter sales, which dropped to $9 million from $16.4 million for the first quarter of 2006. Those same factors may also affect sales for the remainder of this year, the company said in a prepared statement. Bay Street responded quickly to the news, causing RONA shares to drop by $2.29, and close at $22.96, the day the news was announced. RONA's first-quarter consolidated sales stood at $878.5 million, up 10% over the same period a year ago. These came mainly from acquisitions, such as Chester Dawe, Curtis Lumber, Matˆ©riaux Coupal and Mountain Building Centres, plus store openings, and new affiliate dealers. Excluding the contributions from major acquisitions, consolidated sales increased by 4.7%. But RONA president and CEO Robert Dutton remains optimistic about the company's outlook for 2007. "Despite the current situation, I still have confidence that we will achieve the goal of our 7-07 program, which is to achieve $7 billion in annualized retail sales by the end of 2007. Our business model is robust and can perform very well in any kind of market environment," he said.

↑ top

Canadian Tire has healthy 1Q despite slow start

TORONTO —  Canadian Tire Corp. had first-quarter net earnings of $64.5 million, up 35.5% over $47.6 million in the same period of 2006. Sales for Canadian Tire's Retail division were up 3.1%, while same-store sales were up 1.3%. Excluding non-operating gains and losses, company-wide net earnings were $66.9 million, an increase of  24.4% compared to $53.7 million last year. Basic earnings per share were $0.79, an increase of 35.5% compared to $0.58 per share recorded in the first quarter of 2006. Excluding non-operating gains and losses, adjusted basic earnings per share increased 24.4% to $0.82, compared to $0.66 the previous year.

↑ top

CanWel's sales dip, profits tumble, in first quarter

VANCOUVER — CanWel Building Materials Income Fund, the billion-dollar LBM and hardware distributor that owns CanWel Distribution and CanWel, Hardware Division, had sales of  $190 million in its first quarter. That's down from $217 million in 1Q 2006. For the quarter, the Fund reported an improved gross margin of $22 million, or 11.6% of sales, compared with $21 million, or 9.7% of sales, in 2006. The company attributed lower sales during the quarter, on a year-over-year basis, primarily to industry-wide downward price pressure in lumber and panel products. Meanwhile, gross margin increased thanks to a rise in the sales of specialty and hardware products, which represented 61% of the Fund's sales in the quarter, up from 58% a year ago. However, net earnings amounted to $166,000, plunging from $2.4 million during the same period in 2006. "While the lumber and panel products pricing environment remains under pressure and challenging, we are pleased with our success in improving gross margin as we continue to grow the hardware and specialty product categories," said Tom Donaldson, president and CEO of CanWel.

↑ top

Smart appliances, new cooking technologies are the focus of kitchen and bath show

LAS VEGAS — Smart products that take the work out of housework were the stars of the Kitchen/Bath Industry Show and Conference, which filled all three halls of the Las Vegas Convention Center. Those products included touchless faucets, ovens that take the guesswork out of cooking roasts, and dryers with steam features to eliminate wrinkles, all of which are targeting time-pressed consumers. New oven technologies, including induction — which uses electromagnetic energy to heat pots and pans directly, while keeping the cooking surface cool, are set to hit the consumer market this fall. This year, home appliances with green features were also a big draw. The annual event, which draws about 40,000 visitors and 900 exhibitors, ran over three days last week.

↑ top

U.K.'s B&Q plots entry into India

LONDON — B&Q, Great Britain's largest home improvement retailer, is exploring franchise and joint-venture options with several partners for its planned expansion into India. India's Economic Times reports that B&Q, which is part of the retail conglomerate Kingfisher, plans to make an initial investment of $250 million in that country, and sent Steve Gilman, its chief of Asian operations, to India to meet with its minister of commerce and industry, Kamal Nath. B&Q wants a relaxation of retail norms that permit 51% foreign direct investment (FDI) in single-brand retail and 100% FDI in cash-and-carry under the automatic route. B&Q has more than 700 stores in 10 countries, and will be looking to penetrate an Indian home improvement market that is growing at a 12-15% annual clip, according to an analyst quoted by Economic Times. At the same time, B&Q is reported to be planning a withdrawal from South Korea. It currently has two test stores there, in the capital of Seoul. Both Wal-Mart and Carrefour, which are expanding rapidly in China, pulled out of South Korea a year ago.

↑ top