The one-two punch of bad weather and a weak economy took its toll on Boucherville, Quebec-based RONA's second-quarter performance.
Canada's largest distributor and retailer of hardware, renovation and gardening products posted second-quarter sales of C$34.2 million, down 2.4%. Same-store sales declined 9.6%. Net income amounted to C$39.5 million, down from C$66.3 million in the second quarter of 2010.
"For the second quarter in a row, very poor weather conditions, especially in April and May, and fragile consumer confidence significantly impacted our quarterly results," said Robert Dutton, president and CEO of RONA.
Across Canada, the months of March, April and May experienced poor weather conditions. In addition, RONA dealt with the absence of the home renovation tax credit at the beginning of the year.
Dutton pointed to "prudent" management through the first half. One example: The company increased penetration of its private-brand and controlled-brand products from 24% to 28%.
"Although there was less pressure on same-store sales in July, especially in Ontario, and sales in the kitchen and construction material categories were up sharply, we expect continued pressure on same-store sales overall until the end of the year in light of the fragile nature of consumer confidence in Canada and consumers' careful approach to major renovation projects," Dutton said, in a prepared statement.