Ace Q2 revenues increase to $1.021 billion
In a second-quarter earnings season characterized by weather-depressed sales figures, Oak Brook, Ill.-based Ace Hardware Corp. managed to show a gain in revenues.
For the three months ended July 2, Ace saw revenues increase 0.5% to $1.021 billion. For the six-month period, sales increased 1.6% over the same two quarters in 2010.
“We are very pleased with our solid performance during the second quarter despite unfavorable weather conditions in April and May,” said Ray Griffith, Ace president and CEO. “In addition, we are excited about the introduction of our Clark+Kensington paint and primer, which will help drive increased sales and profitability for our retailers.”
The increase in revenue came as the company added 32 new stores and canceled 41. It ended the quarter with a total store count of 4,435, including international locations.
Net income for the quarter was $34.6 million, up 20% from the same period last year.
Other financial highlights from Ace’s second quarter:
• Merchandise sales to comparable domestic stores increased 0.6%;
• Gross profit for the quarter was $125.1 million, a decline of 12.2% from the prior year. Higher inbound freight costs contributed to the decline.
• Operating expenses decreased 15.7% to $83.7 million.
Do it Best Corp. taps new advertising agency
Do it Best Corp. has named Ferguson Advertising its agency of record, assisting the hardware and lumber co-op in a variety of its marketing efforts.
"We’re excited to announce this new strategic partnership with Ferguson Advertising," said Tim Miller, VP marketing for Do it Best. "Our advertising, marketing and public relations work will certainly play an important role in our future growth and success, and we look forward to Ferguson’s contributions in these areas."
Services provided by Ferguson to Do it Best under the agreement will include strategic planning, creative development, and execution for advertising and annual reports, as well as overall marketing and public relations support.
"Do it Best Corp. is a truly global company based here in northeast Indiana, so it’s an honor for us to enter into this agreement with them," said John Ferguson, owner and president of Ferguson Advertising. "We look forward to doing everything we can to help the company meet and exceed its marketing goals and objectives in both the near- and long-term future."
Ace CFO Dorvin Lively resigns
Ace Hardware CFO and EVP Dorvin Lively is leaving the Oak Brook, Ill.-based hardware co-op to pursue other interests.
Lively joined Ace about three years ago and was promoted to EVP in January 2011. On an interim basis, Lori Bossmann will oversee the finance department, while the co-op searches for a new CFO.
Lively was a professional accounting fellow at the Financial Accounting Standards Board in the early 1990s. He later became a senior VP and corporate controller at Toys “R” Us before moving on to Maidenform Brands, and then to Ace Hardware in 2008.
Ace issued the following statement: "Dorvin Lively, a highly valued member of the Ace Hardware Corp. family, has elected to leave his position as chief financial officer to pursue another opportunity. His resignation is effective as of Aug. 10. Ace thanks him for the dedication he brought to his position, which he held since March 2008."
"Ace is involved in a search for a new CFO. In the interim, Ace veteran Lori Bossmann will oversee the finance department and all of its functions. She and Erik Gast, VP finance, along with their team, will allow Ace to pursue a search without disruption to our business and financial operations."
Lively’s thoughts on retail growth, the role of the co-op and other matters were explored in a Home Channel News article in March 2011.