A record Q4. Here’s how Depot did it.
Sales exceeded expectations at the Home Depot in the fourth quarter of 2017. Sales increased to $23.9 billion, as domestic comps hit positive 7.2%.
During the company’s earnings call, Ted Decker, executive VP of merchandising, described sales as strong throughout the store, with a little extra strength from the pro customer and online sales. The latter continued their pace of double-digit growth, he said. A breakdown of performance department by department is here:
• Double-digit comps: lumber, electrical and tools enjoyed double-digit comps in the quarter.
• Higher than average comps: Appliances, plumbing, building materials.
• Lower than average, but positive: Décor, flooring, millwork, paint, indoor garden, hardware, outdoor garden, and kitchen and bath
Only one category was tagged with a negative comp – lighting. According to Decker, the reason is primarily due to LED price deflation.
According to Decker, sales to pro customers grew double-digits in the fourth quarter. “Pro-heavy categories such as lumber, pressure treated decking, insulation, and gypsum all had double-digit growth during the quarter with solid unit productivity,” he said.
Decker pointed to localized assortments in the hardscapes category as example of “balancing the art and science of retail,” he said. “We are leveraging the power of our clustering and space optimization tools to assign assortments and facings at a local store level.” So far, it seems to be working, he added.
Looking ahead, Decker shared with analysts a pair of specific products for which the retailer has high hopes. These were the Klein Tools new 9-inch Journeyman Diagonal-Cutting Pliers and the Hampton Bay patio furniture collection with CushionGuard technology, which he says guarantees water repellency, as well as protection from fading and stains.
Also from the company's fourth quarter results:
• Sales per square foot were $394.87, up 7.8%
• Big ticket sales ($900 plus) were up 9.8%
• Transactions for tickets under $50 increased 0.8%
• Average ticket was $64, up from $60.55.
• Comp average ticket increased 5.5%
• Comp transactions increased 1.9%
DeWalt rolls out two new mowers
DeWalt unveiled a pair of battery-powered mowers – the 2×20 MAX Brushless Mower and the 40V Brushless Mower.
The 2x20V MAX Brushless Mower is optimized for use with DEWALT construction battery platforms. The batteries work simultaneously to deliver the power demanded by the user and provide flexibility to be used with other tools in the DeWalt 20V MAX system, in which there are more than 100 compatible products, the company said. The mower is also compatible with the DeWalt Flexvolt battery system, which promises maximum flexibility and extended runtime.
The 40V MAX Brushless Mower is optimized for use in landscaping applications. The mower is powered by one DeWalt 40V MAX 6.0Ah Battery.
Both the 2x20V MAX and 40V MAX Brushless Mowers feature high-efficiency brushless motors to deliver consistent cutting performance. They also both offer a 20” metal deck to cut a large path, a folding handle for upright storage, and front deck and rear deck carrying handles for easy transportation. They can mulch, bag, or rear discharge grass clippings. Additionally, the 2x20V MAX mower features an on-deck LED light board which signals state-of-charge for each pack and indicates when a recharge is needed.
Available in early 2018, the 2x20V MAX* Brushless Mower will come kitted with two DeWalt 20V MAX 5.0Ah Lithium Ion Batteries and will be available for $399 MSRP. Also available in early 2018, the 40V MAX Brushless Mower will come kitted with one DeWalt 40V MAX 6.0Ah Lithium Ion Battery and will be available for $399 MSRP, as well as bare (battery and charger sold separately) for $299 MSRP.
Q4 profits slide at JELD-WEN
JELD-WEN Holdings, Inc. reported fourth quarter 2017 net revenues increased 0.3% to $976 million from fourth quarter 2016 net revenues of $973.2 million a year ago.
The increase was driven by a 4% contribution from recent acquisitions and 2% due to the favorable impact of foreign exchange but was partially offset by a decrease in core revenues of 6%, JELD-WEN said.
In its North American operations, net revenues decreased $18.9 million, or by 3.3%, to $550.3 million during the quarter due to a decrease in core revenues of 7%, partially offset by a 4% contribution from recent acquisitions. In Europe, JELD-WEN revenues increased 7.8% to $276.4 million.
The Charlotte, N.C.-based door and window manufacturer closed its acquisition of Domoferm – a European provider of steel doors, steel door frames, and fire doors for commercial and residential markets based in Gänserndorf, Austria. Domoferm has 1,000 employees at four manufacturing sites in Austria, Germany, and the Czech Republic. The acquisition is expected to add annual revenues of more than $135 million.
For the full year, JELD-WEN’s net revenues increased 2.6% to $3.76 billion compared to $3.68 billion in 2016.
JELD-WEN also reported a net loss of $93.7 million, compared to net income of $258.2 million in the same quarter last year, a drop of $351.9 million. The company said it had $98 million in charges related to the Tax Cuts and Jobs Act along with $23 million in debt extinguishment costs related to fourth quarter debt refinancing.
For all of 2017, JELD-WEN reported that its net income decreased $366.4 million to $10.8 million, compared to a net income of $377.2 million in 2016. Approximately $98 million of the negative swing was due to the Tax Act and debt extinguishment costs.
“Looking forward into 2018, we are well positioned for core revenue growth, supported by constructive end market demand and our continued investments in new products and innovation," said Mark Beck, JELD-WEN president and CEO.