The Depot delta extends another quarter
Of all the Home Depot metrics that were reported in its second quarter — including double-digit earnings gains — the comparable-store sales metric of positive 2.1% doesn’t jump off the page.
But the figure marks the continuation of an exceptional competitive streak: In each of the last seven quarters, Home Depot’s comps have beat its rival Lowe’s by at least 2 percentage points. This “delta” peaked at 4 percentage points in the second quarter of 2011.
The last time Lowe’s comps outperformed Depot was the first quarter of 2009.
Lowe’s CEO Robert Niblock, during his company’s earnings call, described Lowe’s as a company in transition and a company that expects some level of disruption. Initiatives include multichannel seamless, mobile technology, flexible fulfillment and MyLowe’s, the company’s Web tool. “The team is making progress on these initiatives, but frankly, the benefits are accruing at a slower rate than I had expected.”
In Chicago, upbeat and defiantly convenient
Rallying the troops during the Ace Fall Convention and Exhibits, chairman Dave Ziegler showed the early morning general session audience a video clip of Ace COO John Venhuizen wielding a Home Channel News magazine.
In the magazine was a quote from a Home Depot executive about leading the industry in convenience and service. Venhuizen responded by channeling defiant former NRA spokesman Charlton Heston: Ace will relinquish the title of most convenient “when they can peel it out of our cold dead hands.”
There was more than heavy rhetoric at the Chicago general session.
CEO Ray Griffith shared numbers showing year-to-date Ace sales are up 4.5%, ahead of the budgeted 4.0%. The company opened 78 new stores so far, with a goal of 179 in North America.
The CEO laid out the rationale behind a refinancing deal that led to a one-time expense in the co-op’s recent quarter, but “will save $15 million a year for four years beginning in 2013.”
Griffith said the co-op’s same-store sales are up 3.8% year to date, and transactions are up 1.5% year to date. “I think it reflects the strength of the home improvement market,” he said.
Beacon lights up acquisition scene, again
Beacon added two new companies to its roster in July: Structural Materials Co. in Southern California and Contractors Roofing & Supply Co. in St. Louis.
The appetite for acquisition remains unsated.
“We are confident that we will add other quality companies in the near future that fit our target acquisition profile,” said CEO Paul Isabella during Beacon’s third-quarter earnings call.
If the past is any indicator, that profile includes such companies as Cassady Pierce, Fowler & Peth and Nova Scotia-based The Roofing Connection, acquired in May 2012, November 2011 and October 2011, respectively.
Beacon’s third-quarter sales of $560.5 million — although up 3.7% — were hurt by lower non-residential roofing activity and less residential roofing activity in the markets affected by last spring’s hail storms, partially offset by the benefit of higher average selling prices.