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Tide turns at 84 Lumber

BY HBSDEALER Staff

Despite a continued building slowdown in many of its markets, 84 Lumber returned to profitability this past May, the pro dealer’s first monthly profit of the year, according to a company announcement. Sales had been decreasing at 84 Lumber — which is primarily dependent on single-family housing starts — since April 2006, leveling off in December 2007 and remaining flat since then.

Dan Wallach, 84 Lumber’s CFO, attributed the net gain to several factors. “Because we are a national company with half of our locations in the northeastern quadrant of the country, we have been somewhat less affected by drops in housing starts in the southeast and southwest quadrants than some of our competitors,” Wallach said. “This geographic footprint and gains in market share have allowed our sales to remain consistent even as starts have declined.”

84 Lumber has also eliminated bad debt, reduced payroll and closed or consolidated a number of unprofitable locations this year. This past April, the Eighty-Four, Pa.-based chain of lumberyards entered into two new five-year financing packages totaling $590 million.

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Pier 1 introduces green cleaning products

BY HBSDEALER Staff

Starting this month, Pier 1 will be the exclusive U.S. and Canadian distributor of an environmentally friendly line of cleaning products by Isabella Smith.

The Maison Belle line is non-toxic, biodegradable and uses recyclable packaging. The products are fragranced with 100 percent essential oils and don’t contain synthetic perfume.

Pier 1 will sell three of the fragrances — lemon vanilla, lavender mint and grapefruit bergamot — in the glass cleaner, counter top cleaner and dish soap. The products will be available in about 500 Pier 1 Imports locations across the country.

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Roofing demand expected to climb

BY HBSDEALER Staff

The demand for roofing materials, which contracted sharply in 2006 and 2007 primarily due to the downturn in new residential construction, is expected to grow nearly 2 percent per year through 2012, according to a study by Cleveland-based research firm the Freedonia Group.

The recovery of the residential construction market and an increase in commercial construction will both provide growth, along with residential reroofing, the study said. Through 2012, demand for roofing in nonresidential construction markets is projected to increase more than 1 percent per year, in line with its pace from 2002 to 2007. The office and commercial construction market will provide the greatest growth, driven by increased demand in new construction applications.

While new roofing applications are expected to grow faster through 2012, the majority of demand will continue to come from reroofing applications. In 2012, reroofing will account for three-quarters of total roofing, according to the researchers.

However, reroofing demand is expected to weaken through 2012, due to past construction cycles that reduced the number of buildings requiring routine reroofing over the forecast period.

Roofing tile and plastic roofing are anticipated to see the fastest gains through 2012. Demand for roofing tile will be driven by the recovery of the residential market, especially in the South and West, where roofing tile demand is greatest, according to the study. Demand for plastic roofing (such as thermoplastic polyolefin, PVC and spray polyurethane foam), which is primarily used in nonresidential construction, will increase as plastic materials supplant bituminous low-slope roofing products.

Asphalt shingles will remain the most popular roofing product, owing to their dominant position in the large residential roofing market. Demand for asphalt shingles is expected to accelerate markedly through 2012 as the new residential market recovers. Asphalt shingles are forecast to account for more than 80 percent of residential roofing demand through 2012.

On a regional basis, the West will provide the best prospects for roofing demand through 2012. The West experienced one of the sharpest declines in housing construction in 2006 and 2007 and will benefit the greatest from its recovery. Growth will be led by the Mountain subregion, which is expected to outpace the average in terms of growth in population and economic output.

The Freedonia study, available at  www.freedoniagroup.com, also contains profiles of the roofing industry’s manufacturers and an analysis of their market shares.

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