HARDLINES™
Five years serving Canada's home improvement industry
May 23, 2000 - Volume vi, #20
Michael McLarney, Editor & Publisher
Ph: 416-489-3396 Fx: 416-489-6154
E-mail: buzz@hardlinesfax.com Check out our incredible Classifieds section!* * * * * *
* IN THIS ISSUE:
* Réno-Dépôt opens fifth big box in Montréal
* Home Depot boss talks about risks and priorities
* Sodisco-Howden hints at another acquisition
* Home Depot's 1Q sales up 24%
* * * * * *Hardlines Networking EventPERSONAL MANAGEMENT WORKSHOP El Rancho Relaxo Bar & Grille May 24, 4-9 p.m., Toronto"GETTING ORGANIZED" -- Management Workshop with organizational guru Estelle Gee. We'll have some fun breaking the ice and learning some important self-management skills. Plus: Country & western band The Wayward Angels. Don't forget to bring lots of business cards!WHERE: El Rancho Relaxo Bar & Grill WHEN: May 24, 4-9 p.m., Toronto. Who should attend? Any vendor, retailer or service provider in packaged goods retailing who wants to increase their business contacts, sharpen their personal skills -- and just have fun. Call Bev for details at 416-489-3396, extension 2. Call Beverly at 426-489-3396, ext. 2, or e-mail: bev@hardlinesfax.com for details!Ticketsare only $79 + GST each and include drinks, fajitas, entertainment, door prizes, giveaways, free parking and more!Check out last year's event!We are pleased to have ACNielsen join us as sponsor of the Third Annual Hardlines Networking Event. We also wish to thank the following companies for their support:Ace Hardware CanadaBeaver LumberCanadian Tire Corp.Hardware Merchandising
Home Hardware Stores Ltd.
Proforma (our print guy)
Sensible Insurance (our financial advisor)* * * * * *ENHANCEMENTS MARK NEWEST RÉNO-DÉPÔT Réno-Dépôt has opened its newest big box store in Montréal &emdash;the fifth in that city and its 11th in Québec. Located in Notre-Dame-de- Grâce, The 128,000-sq.ft. store, which includes a 20,000-sq.ft. garden centre, cost more than $21 million and employs 300. It will serve southwest Montréal and surrounding area. The company is using this site for a number of innovations to enhance the shopping experience for both women and men. An interactive seminar area called Skillbuilders' Club provides hands-on activities to children from 6 to 12. "Campus Réno-Dépôt" features workshops by vendors and associates for more seasoned renovators. The layout has been modified, as well. For example, drywall is now at the front of the store, along with the latest décor items, with an emphasis on international styling. The company will continue its expansion in the fall of 2000, this time in Ontario, with the opening of the first The Building Box warehouse stores in the Metro Toronto area. Réno-Dépôt Inc. currently operates 11 warehouse stores in Québec: Brossard, Anjou, Laval, Pointe-Claire, Québec City, St- Hubert, Hull, Rosemere, LaSalle, and, in Montréal proper, Marché Central and Notre-Dame-de-Grâce.* * * * * *HOME DEPOT'S ANNETTE VERSCHUREN SHARES PERSONAL SIDE The president of Home Depot Canada was guest speaker at the first- ever event of the Women's Consumer Products Network, held last week in Toronto. Annette Verschuren didn't talk so much about the home improvement industry as about her own life and the challenges of being a woman in a male-dominated industry. Her personal anecdotes and insights found a receptive audience in the 85-plus women in attendance, who gave her a standing ovation. Verschuren, the daughter of Dutch farming immigrants to Nova Scotia, was 39 when she took the helm of Home Depot's Canadian division four years ago. Eighteen months later it was one of the most profitable in the company. The values instilled on the farm prevail in her job today. "My priorities are very clear," she said, "my family comes before my work." Some highlights of Verschuren's talk … "When we open a store, we do the demographics around that store and hire to that demographic." "I spend a lot of energy on the 'A' players. A lot of people spend time on the 'C' players thinking they can bring them along. I don't. I have people to do that. I's so important to spend your time on the people who have the most potential." "Take risks and fail. You've got to fail. Because then the taste of success is so beautiful because of where you've been." "Of all the human skills, listening is the most difficult skill." "Dream big and think outside your boundaries." * * * * * *SODISCO-HOWDEN TO BUY BACK SHARES, HINTS AT ANOTHER ACQUISITION For the first quarter ended March 31, 2000, Sodisco-Howden Group had sales of $86.3 million, up 16% from $74.7 million in the first quarter of 1999. Earnings before expenses, depreciation and income taxes totalled $1.9 million, up 5.4% from $1.8 million last year, reflecting strong growth in the renovation and building materials sector. Net earnings for the quarter increased 34% to $126,000 from $95,000. Operating expenses remained at the same level, while financial expenses were similar to last year's, despite a $200,000 increase in interest expense related to debentures. The company also announced its intention to consolidate its common shares on a 20-to-1 basis and to buy back up to 5% of outstanding shares. "In line with our objectives to increase both the top and the bottom line, we are seeking this year another acquisition opportunity and we will further strengthen our position as a distributor of choice for independent retailers in the hardware and home improvement industry," said Tony Molluso, president and CEO of Sodisco- Howden. The company recently completed the purchase of western hardware distributor Smith-Barregar. COMPANIES IN THE NEWSCan-Save has moved into new facilities on property adjoining its former distribution centre in Barrie, Ont. The 80,000-sq.ft. building has 20% more space and 55% more warehouse space, thanks to higher racking and more standardized pallet sizes. Richwood Building Products has acquired ABTCo's lines of shutters, blocks, vents and louvres, as well as the production facilities. London, Ont.-based Polar Shutters will distribute and sell the lines in Canada.Home Depot reported sales for the first quarter of 2000 of US$11.112 billion, a 24% increase over the first quarter of 1999. Same-store sales rose 7% from the same period last year. Net earnings reached US$629 million, up 29% from US$489 million. Sales were driven by 223 million-plus customer transactions and a 3% increase in the average sale per transaction. During the first quarter, Home Depot opened 41 new stores and relocated one for a total of 971 stores, namely 892 Home Depots, 15 EXPO Design Centers, and two Villager's Hardware in the U.S.; 56 Home Depots in Canada; four in Chile; and two in Puerto Rico, comprising approximately 105 million sq.ft. of selling space. For the quarter ended April 28, sales at Lowe's Cos. Inc. increased 18.4% to US$4.47 billion, up from US$3.77 billion in the first quarter of 1999. Same-store sales increased 4.1%. Net earnings reached US$187.1 million, a 50% increase over the same period a year ago. During the quarter, Lowe's opened 13 new stores and relocated 2 stores, for a total of 589 stores in 39 states. Retail square footage grew 19% to 58.5 million. Restoration Hardware's first quarter sales increased 14.3% to US$68.6 million from $60 million. However, same-store sales slipped 14.4% compared with the same period a year earlier. In last year's first quarter, same-store sales increased 18.4%. The company reported a net loss of US$4.3 million, compared with a net loss of US$2.7 million last year. Sales for Cameron Ashley Building Products dropped from U.S.$270.1 million to U.S.$264.0 million in the second quarter ended April 30. Net losses amounted to US$2.4 million, compared with net income of US$3.5 million for the same period a year earlier. CANADIAN STOCK WATCH