Snap-on brings auto industry veteran to board
Kenosha, Wis.-based Snap-On, a maker of tools and power equipment, has named James Holden as non-executive chairman of its board of directors.
Holden, 56, is a veteran of the automobile industry, where he worked for 19 years with DaimlerChrysler and its predecessor, Chrysler.
“He brings tremendous automotive and technology experience that will benefit Snap-on as it continues to execute its growth strategies,” said Dudley Lehman, Snap-On director and chair of its corporate governance and nominating committee.
Snap-on had about $2.5 billion in sales last year and makes a broad range of hand tools, power tools, cutting equipment and diagnostic equipment.
Weyerhaeuser finds buyer for Oregon plywood mill
Pacific States Industries of San Jose, Calif., signed a purchase and sale agreement to acquire Weyerhaeuser‘s plywood mill in Springfield, Ore.
The Springfield facility has been closed since December 2006. At that time, it employed 87 people and had the capacity to produce 114,000 million square feet of plywood annually.
Operating through its Redwood Empire division, Pacific States Industries operates two sawmills in Northern California. The company also owns Bald Knob Veneer in Creswell, Ore.
“We are pleased to have reached this agreement with Weyerhaeuser and anticipate that the transaction will close in 30 to 45 days,” said Austin Vanderhoof, executive vp of Pacific States Industries, in a prepared statement. “The plywood operations at Springfield will complement our existing production of veneer in Creswell Oregon.”
Home Depot lowers outlook
Home Depot executives presented a “retail update” to a group of analysts in New York today, warning that per-share profit is expected to drop 15 percent to 18 percent. Total sales for 2007 are expected to fall 1 percent to 2 percent, with negative comps in the mid-single digits.<
The sale of HD Supply, which is expected to close on Aug. 16, will depress earnings, company officials said. Volatile lumber prices and continued weakness in the housing market has also dampened revenues, especially in windows, roofing, flooring, appliances and water heaters.
Home Depot also announced the launch of a tender offer today to buy back 250 million shares for between $39 and $44 per share. The self-tender offer is set to expire Aug. 16.
“With the sale of HD Supply, we now have a laser focus on our retail business,” said Carol Tome, CFO and executive vp–corporate services.
Tome spoke of several retail initiatives including a revamping of Home Depot’s supply chain to centralize its distribution. The company plans to pilot the new model in Canada starting in the first quarter of 2008.
Home Depot is also changing its promotional strategy, according to chairman and CEO Frank Blake. “We’ve gotten into a pattern of [repetitive] promotions [and] we felt strongly that we needed to break that cycle,” Blake said. The retailer is now trying to offer consumers more targeted promotions with clearer value propositions, such as a current $99-per-room flooring installation offer.
Blake also addressed the difficulties faced by smaller vendors trying to get their products into Home Depot. To address this issue –- and keep up the flow of innovative products into its stores –- the company has instituted open-to-buy days. The first one, held last month in Atlanta, drew 290 vendors. Home Depot will hold a second open-to-buy day in August, Blake said.