Ace Hardware's record performance
In a period calling for safety and convenience, Ace reports big numbers.
Unusual times produce unusual numbers.
The thorough third-quarter earnings report from Oak Brook, Ill.-based Ace Hardware Corp. is evidence “A” of that concept.
Among the big numbers:
• A 221% increase in revenue at Acehardware.com;
• A 28.9% increase in U.S. retail same-store sales, at the 3,300 or so Ace dealers who share data with corporate on daily retail sales; and
• A record high revenue figure of $2.0 billion – up 30.7% from the same quarter of 2020.
In its earnings release, the company tipped its hat to the unusual environment that has given birth to these numbers across much of home improvement industry – and specifically for Ace dealers.
The heightened importance of both convenience and safety, coupled with the shift in consumer discretionary spending from sectors such as travel and entertainment into home preservation, have distorted demand and driven much of the growth within Ace stores in the U.S.” the co-op said.
CEO John Venhuizen described the retail environment as “very difficult and demanding for both our customers and our associates.”
Ace Hardware Corp. also provided insights into the performance of its two major retail holdings – Westlake Ace Hardware and Great Lakes Ace. Combined, the retailers operated 194 stores at the end of the third quarter, picking up a combined 11 stores compared to the same time a year ago.
The Lenexa, Kan.-based Westlake Ace Hardware chain (see sidebar) experienced a 28.3% increase in same-store-sales while the Farmington Hills, Mich.-based Great Lakes Ace Hardware, Inc. chain grew same-store-sales by 40.5 percent in the quarter.
For Westlake, eleven new California stores (formerly operated as Orchard Supply Hardware Stores) opened by Westlake in 2019 contributed $19.7 million of the increase in sales.
Ace added 43 new domestic stores in the third quarter of 2020 and cancelled 22 stores. The Company’s total domestic store count was 4,585 at the end of the third quarter of 2020 which was an increase of 57 stores from the third quarter of 2019. On a worldwide basis, Ace added 46 stores in the third quarter of 2020 and cancelled 29, bringing the worldwide store count to 5,403 at the end of the third quarter of 2020.
The bottom line also produced big numbers for the Oak Brook, Ill.-based co-op. Net income of $98.7 million was up 63.1% and marked a new record for Ace. The co-op also announced accrued patronage dividend to shareholders of $263.8 million, an increase of 66.9% from the first nine months of 2019.
“I want to genuinely thank the Ace team for their gutsy performance,” said Venhuizen.