Ace reports strong revenue growth
Oak Brook, Ill.-based Ace Hardware Corp. reported fourth quarter 2017 revenues of $1.32 billion, up 6.8% from the fourth quarter of 2016. Net income was $14.2 million for the fourth quarter of 2017, a decrease of $7.3 million from the fourth quarter of 2016. This decrease included a charge of $4.1 million due to the new tax legislation enacted in 2017 as well as increased warehouse costs incurred as part of the warehouse network reconfiguration.
Net income for the full year was $147.4 million, a decrease of $13.8 million, from fiscal 2016. This decrease was the result of a charge of $4.1 million due to the new tax legislation enacted in 2017 as well as $9.5 million of after-tax charges to reposition the warehouse and call center network to support future growth. Excluding these unbudgeted charges, the Company’s net income for fiscal 2017 exceeded its 2017 plan.
“New store growth, a 3.1 percent increase in same-store retail sales, along with revenues from our acquisition of The Grommet at the end of the last quarter, were the predominant drivers behind our strong 6.8 percent overall sales increase and record setting fourth quarter revenue,” said John Venhuizen, President and CEO. “I’m also encouraged to report that 2017 marked the fifth-straight year of increased customer transactions at retail, the sixth-straight year of net new store count growth, the eighth-straight year of increased same-store-sales, and the eleventh-straight year receiving the J.D. Power award for highest customer satisfaction.”
The 3.1% increase in retail same-store-sales during the fourth quarter of 2017 reported by the approximately 3,000 Ace retailers who share daily retail sales data was the result of a 3.4 percent increase in average ticket.
In 2017, Ace added 152 new domestic stores, bringing its domestic stor count to 4,418, a net gain of 55 stores from the end of fiscal 2016.
[For more details on Ace's fourth quarter and full year results, click here.]
Consolidated revenues for the quarter ended Dec. 30 totaled $1.32 billion. Total wholesale revenues were $1.23 billion, an increase of 5.1% as compared to the prior year fourth quarter.
Increases were noted across all departments with power tools and paint showing the largest gains, the co-op said.
Total retail revenues for the quarter were $89.4 million, an increase of $25.0 million, or 38.8 percent, as compared to the prior year fourth quarter. Retail revenues from Ace Retail Holdings — or Westlake Ace Hardware — were $67.8 million in the fourth quarter of 2017. This was an increase of 5.3% from the fourth quarter of 2016. The increase was primarily the result of new retail stores added since the fourth quarter of 2016.
Retail revenues from Ace Ecommerce Holdings, which was formed in the third quarter of 2017 for the acquisition of The Grommet were $21.6 million in the fourth quarter of 2017.
Consolidated revenues for fiscal 2017 totaled $5.4 billion an increase of 5.1%, as compared to the prior year. Total wholesale revenues were $5.1 billion, an increase of 4.7%. Increases were noted across all departments with outdoor living, power tools and lawn and garden showing the largest gains.
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And the winner is …
Washington, D.C. — The True Value Company continued its tradition of recognizing the Best Hardware Stores in town here at its Spring Reunion in the nation’s capital. And once again, the honorees – all 13 of them – shared the spotlight during the co-op’s general session.
Of the honorees, one was chosen as the overall winner: Handyman True Value of St. Louis. According to the retailer’s website, Handyman’s history dates back to 1961. It operates three locations, with an emphasis on service and selection.
The full 2018 class of “True Value Best Hardware Store in Town” honorees is listed here.
- Fusek’s True Value, Indianapolis
- Sarver True Value, Sarver, Pa.
- East Lyme True Value, East Lyme, Conn.
- Northwest True Value, Roanoke, Va.
- Alpers True Value, Port Washington, N.Y.
- Handyman True Value, St. Louis, Mo.
- Prescott True Value, Prescott, Ariz.
- Russell’s True Value, Del Rio, Texas
- Mound True Value, Mound, Minn.
- Ennis True Value Hardware, Ennis, Mont.
- Penn Valley True Value Hardware, Penn Valley, Calif.
- Wilco Farm Store, McMinnville, Ore.
- Carter's General Stores, Bridgetown, Barbados
The announcement of the Best Hardware Store in Town honorees has been a highlight of recent True Value Reunions, and the Feb. 9-12 Spring Reunion in Washington, D.C., event was no exception. During this year’s announcement, True Value CEO John Hartmann marked the occasion by snapping a cell-phone photo of the honorees while they were assembled on the stage. Here’s the picture:
True Value holds court in D.C.
Washington, D.C. — True Value Company spent the weekend in Washington D.C., spreading the word about the power of the independent retailer, and promoting programs designed to succeed in a changing, challenging retail environment.
During the co-op’s Saturday night general session, digital marketing took center stage. The company emphasized its transformational approach “targeting profit and growth back to your business,” in the words of David Elliott, senior VP of marketing. The marketing strategy favors digital over print, and a targeted-approach over mass marketing.
The 60-minute session covered a wide swath, from web site strategy to inspirational stories of dealers. Highlights from the general session presentation in Washington, D.C. included:
• The new TrueValue.com was promoted with the idea of driving more customers into the store. To that end, 1,200 warehouse items are being designated as “in-store only items.” The new site also plans to deliver local-store pricing, an announcement that generated spontaneous applause from the crowd of dealers. The website is expected to go live April 1.
• The need to transform the marketing approach was backed up by stats on the changing nature of media. For instance: more than 22 million people have canceled cable, and more than 70 million are expected to cancel cable. Plus, shopping on websites has jumped from 26% to 45% of the population.
• A partnership with HomeAdvisor, an online service that connects home owners to contractors. HomeAdvisor purchased Angie’s List in late 2017. One of the benefits for True Value members is an enhanced ability to offer home installation services without liability.
• COO Abhinav Shukla predicted improved operational efficiencies through the deployment of a JDA demand-planning and forecasting system.
• Keys to success revealed. Senior Vice President of Growth Tim Mills pointed to common denominators of high-performing members. These include a “Deep commitment to relevance and customer service,” and a “strong relationship with their True Value rep.”
The session also included inspirational videos of Bailey’s in Florida, and Village True Value and Montecito True Value of California. These stores suffered through natural disasters in 2017, and remained open to serve their communities above and beyond any normal business requirement.
The True Value Reunion in Washington, D.C., which included a Saturday night concert from rock legend Pat Benatar, runs through Feb. 12.
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