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CHHMA NEWS

CHHMA - EYE ON OUR INDUSTRY
Volume 15, Issue 43, November 18, 2015

Inside This Issue:

• Register Now for the Industry Cocktail (December 10th) in Montreal
• You’re Invited to Save on Your Freight & Distribution Costs... and It Costs Nothing to Find Out How Much It Could Be!
• Target Hikes Earnings Forecast after Profit Rises
• Loblaw’s Profit, Revenue Climb
• Lowe's Sales Exceed Forecasts on Strengthening U.S. Housing Market
• Home Depot Third Quarter Same-Store Sales Beat Estimates
• Wal-Mart Profit Dips But Tops Q3 Estimates as CEO Pursues Sales Turnaround
• Sears Canada Sells More Real Estate, Including $100M Distribution Centre
• Canadian Tire Delivers Strong Third Quarter Results
• Canadian Home Resales in October Hit Second Best Month in Nearly Six Years
• Loonie is 'Carving Out a Bottom' (But it's Not There Yet)
• Bank of Canada Says Soft Landing Still Likely for Housing Sector
• Vancouver, Toronto, Hamilton See Eye-Popping Home Price Increases in Past Year
• Canadian New Home Prices Edge Higher in September
• Canadians Fully Embracing Shopping Season in Spite of Slower Economy, Lower Dollar
• Latest U.S. Economic News

Association News

Register Now for the Industry Cocktail (December 10th) in Montreal

This year’s Industry Cocktail is taking place on Thursday, December 10th from 5:30 p.m. to 8:30 p.m., at the Bar Dame de Coeur at the Casino de Montreal.

The location offers a fun and relaxing atmosphere where you can enjoy some wonderful food, drinks and conversation with friends from the industry while enjoying the festive season together.

Click here for further information and registration.  
 


You’re Invited to Save on Your Freight & Distribution Costs... and It Costs Nothing to Find Out How Great Your Savings Could Be!

Through Logistics Solutions & Services Inc. (LSS), the CHHMA has established a logistics and transportation program that can help our members to reduce freight and distribution costs, improve service, and reduce transit times. Many CHHMA members have already taken advantage of this program. Over the close to 20 years this program has been offered, the combined savings to members is measured in the millions of dollars and growing.

CHHMA members can enjoy the best freight and courier rates available as a benefit of our program through LSS. LSS specializes in Courier, LTL, Truckload and 3PL services, International Ocean and Airfreight throughout North America and abroad and continues to meet the needs of the shipping public through strong, reliable and knowledgeable logistics management consulting.

It all starts with accurate and informative benchmarking.  Read More >>



Industry News

Target Hikes Earnings Forecast after Profit Rises

Target Corp. on Wednesday reported a bigger-than-expected increase in quarterly profit as revenue got a boost from online sales and strong growth in product categories at the centre of its turnaround plan.

Target, the fourth-largest U.S. retailer, also raised the lower end of its earnings forecast for its fiscal year. It said it expected earnings of $4.65 to $4.75 per share, excluding special items, against its previous outlook of $4.60 to $4.75.  Excluding special items, earnings came to 86 cents per share in the third quarter ended on Nov. 1, compared with 79 cents a year earlier.  Net sales rose 2.1% to 17.6 billion.

Analysts on average expected profit of 85.9 cents per share on sales of $17.57-billion, according to Thomson Reuters.  Target said same-store sales rose 1.9%, beating the market consensus of 1.7%, according to research firm Consensus Metrix.  Read More >>



Loblaw’s Profit, Revenue Climb

Loblaw Companies Ltd. says it earned $166-million in its latest quarter, up nearly 17% from a year ago.

The retailer says the profit amounted to 40 cents per share for the quarter ended Oct. 10.  That was up from a profit attributable to common shareholders of $142-million or 34 cents per share a year ago.  Revenue for the 16-week period totalled $13.95-billion, up from $13.60-billion.  On an adjusted basis, the company says it earned $408-million or 99 cents per share in what was its third quarter.  That was up from $371-million or 90 cents per share a year ago.

Same-store sales growth for the company’s food business was 3.1%, excluding its gas bar and the negative impact of a change in distribution model by a tobacco supplier. Meanwhile, the company’s drug retail same-store sales growth, which includes Shoppers Drug Mart, was 4.9%.  Same-store pharmacy sales increased 3.5%, while front store sales increased 6.2%.  Read More >>



Lowe's Sales Exceed Forecasts on Strengthening U.S. Housing Market

Lowe’s Cos Inc. reported better-than-expected quarterly profit and same-store sales on Wednesday, as people spent more on home improvement amid a strong recovery in the U.S. housing market.

Lowe’s reported an increase in both the number of transactions and their average value in the third quarter ended Oct. 30.  That helped same-store sales rise 4.6%, more than the 4.1% growth analysts on average had expected, according to research firm Consensus Metrix.  Same-store sales at its U.S. home improvement business increased 5%.

Lowe’s net income rose to $736-million, or 80 cents per share, in the quarter from $585-million, or 59 cents per share, a year earlier.  Net sales rose 5% to $14.36-billion.  Analysts on an average were expecting earnings of 78 cents per share on revenue of $14.34-billion, according to Thomson Reuters.  Read More >>



Home Depot Third Quarter Same-Store Sales Beat Estimates

Home Depot Inc. reported a better-than-expected rise in quarterly same-store sales on Tuesday, helped by strong demand from both retail customers and professional contractors and builders.  The company also said it expected profit and same-store sales for the year ending January to come in at the top end of its forecasts, helping to send its shares up 2.5% in premarket trading on Tuesday.

Home Depot overall same-store sales rose 5.1% in the third quarter ended Nov. 1, above the 4.6% growth expected by analysts polled by research firm Consensus Metrix.  Same-store sales at its U.S. stores rose 7.3%, comfortably ahead of analysts’ average estimate of 5.9%.  The company expects overall same-store sales to grow 4.9% in the year ending January.  Home Depot’s net income rose 12.2% to $1.73-billion, or $1.35 per share, in the quarter.  Read More >>



Wal-Mart Profit Dips But Tops Q3 Estimates as CEO Pursues Sales Turnaround; Canadian Division Lures More Customers Away from Supermarkets

Wal-Mart Stores Inc. topped third-quarter profit estimates and increased the low end of its annual forecast, a sign the retailer is making progress reining in costs and revamping its stores.  Earnings were 99 cents (U.S.) a share in the period, excluding some items, the company said on Tuesday.  Analysts had predicted 98 cents on average, according to data compiled by Bloomberg. The company now expects profit of $4.50 to $4.65 a share this year, up from a previous forecast of at least $4.40.

Meanwhile, Canadians are spending more of their weekly food budgets at Walmart Canada stores, the company said Tuesday, as the world’s largest retailer moves to make grocery items a “core” offering at Canadian locations.  Sales across Walmart’s network of about 400 Canadian stores jumped a strong 5.7%, the retailer said, “driven by [a] strong performance in our core grocery business, as well as [a] stronger performance in our general merchandise business.”  Read More >>



Sears Canada Sells More Real Estate, Including $100M Distribution Centre

Sears Canada says it’s selling a distribution centre in Vaughan, Ontario for $100-million but will continue to occupy it once the transaction closes next year.  The department store operator also announced last Friday that it has vacated another distribution centre and sold it for $8.5-million in a transaction expected to close by the end of 2015.  Read More >>



Canadian Tire Delivers Strong Third Quarter Results

Canadian Tire Corp. reported solid growth in the third quarter last Thursday as the retailer reaped benefits from improvements made to its network of stores.  Overall revenue was flat, though, as the retailer felt the pinch of falling oil prices on its petroleum sales.

Profit in the period ended Oct. 3 rose 20.5% to $2.62, or $199.7-million, helped by a 33 cent per share boost from a real estate gain, compared with earnings of $172.2-million ($2.15) in the same period a year ago.  Revenue rose 0.1% to $2.8 billion from $2.7 billion in the same period of 2014. Revenue in the retailer’s petroleum division fell to $476.1-million from $552.4-million.

Sales at Canadian Tire’s banner stores rose 1.5% and were up 3.4% on a same-store basis. FGL Sports continued a streak of strong growth, with sales and same-store sales up 6.5% and 7% respectively.  Mark’s sales rose 2.7% and same-store sales fell 0.2%.  Read More >>       



Economic News

Canadian Home Resales in October Hit Second Best Month in Nearly Six Years

Sales of existing homes in Canada rose in October from September led by strength in Vancouver and Toronto despite signs of slack in the condo market, a report from the Canadian Real Estate Association (CREA) showed on Monday.  The number of homes trading hands via MLS® Systems of Canadian real estate Boards and Associations rose by 1.8% in October compared to September. As a result, national activity stood near the peak recorded earlier this year and reached the second-highest monthly level in almost six years.

Actual (not seasonally adjusted) sales in October were little changed (+0.1%) from activity one year ago, when it reached the second-highest level on record for the month.

The actual (not seasonally adjusted) national average price for homes sold in October was $454,976, up 8.3% on a year-over-year basis.  Read More >>



Loonie is 'Carving Out a Bottom' (But it's Not There Yet)

The Bank of Montreal believes the Canadian dollar is nearing its bottom.  It’s not there yet, according to BMO and others, but it’s getting close.  So much depends on what happens with oil prices and the diverging monetary policies of the U.S. Federal Reserve and the Bank of Canada.  From where BMO sits, the loonie will fall “modestly further” to about 74 cents (U.S.) when the Fed finally launches its first interest rate hike.  Read More >>



Bank of Canada Says Soft Landing Still Likely for Housing Sector

The Bank of Canada’s number-two policy maker said the central bank remains confident that Canada’s housing sector will achieve a soft landing, just days after a leading global economic body warned of rising risks in overheated pockets of the Canadian market.  “Our base case, and one that we outlined in the [October Monetary Policy Report], is that the housing market and household debt are going to evolve in a constructive way,” said Carolyn Wilkins, senior deputy governor at the Bank of Canada, in an interview with The Globe and Mail last week. “We don’t see the risk as part of our base case at all.”  Read More >>     



Vancouver, Toronto, Hamilton See Eye-Popping Home Price Increases in Past Year

If you needed more evidence of where the action is, the latest reading of Canadian home prices spells it out.  Values rose in Vancouver by 0.6% in October from September, and in Toronto by 0.3%, according to the Teranet-National Bank home price index released last Thursday.

But it’s the year-over-year figures that are eye-popping: 9.8% in Vancouver and 9.3% in Toronto and nearby Hamilton. 

Those are the three cities that have seen prices surge repeatedly, and in the case of Vancouver and Toronto have led to warnings about the froth in the markets. But in the remaining eight metropolitan areas, prices were flat on average.  Read More >>



Canadian New Home Prices Edge Higher in September

Statistics Canada’s New Housing Price Index (NHPI) edged up 0.1% in September from August, pushed higher by strength in the major regions of Toronto and Vancouver, the agency reported last Thursday. Market analysts polled by Reuters had expected a 0.2% increase. The census metropolitan area (CMA) of Vancouver (+0.4%) and the combined region of Toronto and Oshawa (+0.2%) were the top contributors to the national increase.

Meanwhile, the NHPI increased 1.3% over the 12-month period ending in September. The national index has shown identical year-over-year price movements for the past four months.  Read More >>   



Canadians Fully Embracing Shopping Season in Spite of Slower Economy, Lower Dollar

According to a recent poll by Ebates.ca, the vast majority of Canadians (79%) plan on spending the same or even more over the holiday season as they did last year, but they will be smart about it.  Around half of Canadians plan to stretch their holiday budgets and take advantage of the deals during the biggest shopping days of the year: 45% will shop on Black Friday; 40% on Cyber Monday and 53% on Boxing Day – which in Canada is still viewed as the day with the best deals.

"While the economy may not be predictable, Canadian shopping habits are," said Adrienne Down Coulson, General Manager, Ebates.ca. "Our survey demonstrates that shoppers employ a range of clever strategies when it comes to shopping smart and stretching their budget during the holiday season."   Read More >>     



Latest U.S. Economic News
       

U.S. housing starts in October fell to a seven-month low as single-family home construction in the South tumbled, but a surge in building permits suggested the housing market remained on solid ground.

U.S. consumer prices increased in October after two straight months of declines as the cost of goods and services rose, signs of firming inflation that further support expectations that the Federal Reserve will raise interest rates next month.

U.S. retail sales rose less than expected in October amid a surprise decline in automobile purchases, suggesting a slowdown in consumer spending that could temper expectations of a strong pickup in fourth-quarter economic growth.  Read More >>  

  

 Upcoming CHHMA Events 

Industry Cocktail
Thursday, December 10, 2015
Casino de Montreal, Montreal, Quebec

Canada Night
Held in Conjunction with the International Home+Housewares Show
Sunday, March 6, 2016
InterContinental Hotel, Chicago, Illinois

CHHMA Spring Conference & AGM
Tuesday, April 12, 2016
International Centre (Conference Facility), Mississauga, Ontario

CHHMA Maple Leaf Night
Held in Conjunction with the National Hardware Show
Wednesday, May 4, 2016
The Mirage Hotel & Casino, Las Vegas, Nevada

CHHMA Quebec Golf Classic
Thursday, May 19, 2016
Club de golf Le Fontainebleau, Blainville, Quebec

CHHMA Ontario Golf Tournament
Tuesday, May 31, 2016
Angus Glen Golf Club, Markham, Ontario
       
       

CHHMA Industry Calendar

To register for all events visit our website at www.chhma.ca or call Pam Winter at (416) 282-0022 ext.21.


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"Eye On Our Industry" is published by the CHHMA as an information resource for our members. Member input regarding content and format is welcomed. Please contact Michael Jorgenson by email: mjorgenson@chhma.ca, or call at (416) 282-0022, ext. 34. CHHMA is located at 1335 Morningside Ave., Suite 101, Scarborough, ON, M1B 5M4 www.chhma.ca

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Canadian Hardware & Housewares Manufacturers Association | 1335 Morningside Ave., Suite 101, Scarborough, ON M1B 5M4
Telephone: (416) 282-0022   Email: pwinter@chhma.ca