May 2008 - Page 3 of 6 - Modern Distribution Management

May 2008

BMHC Closes two Facilities in California

Building Materials Holding Corp., San Francisco, CA, a provider of building materials and construction services to professional residential builders and contractors, announced its subsidiary BMC West will close its millwork and building materials distribution facilities in Merced and Bakersfield, CA.
 
Both markets will be served from nearby operations in Modesto and Fresno.
 
The difficult decision to close our facilities in Merced and Bakersfield is a necessity based on today’s challenging business environment and weakness in the housing markets in California’s Central Valley,” said Stanley M. Wilson, president and COO.
 
“Single-family housing permits in the Central Valley markets we serve have fallen sharply from 4,905 in the first quarter of 2007 to …

BMHC Closes two Facilities in California Read More »

Industrial Distribution Group 1Q Sales Down 5.7%

Atlanta, GA-based Industrial Distribution Group, Inc. reported first-quarter revenues of $127.3 million, compared with $135.1 million in the year-ago period, a decline of 5.7%. Profit was $0.9 million, compared with $1.5 million last year.
 
For the first quarter, revenues from Flexible Procurement Solutions, IDG’s services-based supply offerings that include storeroom management, were $78.6 million, a decline of $2.5 million or 3% compared to the first quarter 2007.
 
New sites implemented since the first quarter of 2007 generated incremental revenue in the first quarter of 2008; however, these new site revenues were more than offset by the non-renewal of certain sites in the fourth quarter of 2007, for which the company said it did not seek renewal because of …

Industrial Distribution Group 1Q Sales Down 5.7% Read More »

Canadian Manufacturing Sales Fall 1.6% in March

Source: Statistics Canada
 
Canadian manufacturers gave back some of their recent gains in March as factory sales retreated 1.6% to $49.0 billion.
 
The scope of March’s slowdown was extensive as 18 of the 21 manufacturing industries, representing 76% of total sales, posted declines. A sharp downturn in motor vehicle manufacturing was the chief contributor.
 
Sales were down 7.7% compared with the peak level of $53.1 billion set in March 2007.
Manufacturing activity falters during the first quarter
 
In the first quarter of 2008, manufacturing sales fell 5.5% to $143.8 billion compared with the same period one year earlier. The ongoing slump in the auto …

Canadian Manufacturing Sales Fall 1.6% in March Read More »

Industrial Production Falls in April

Industrial production declined 0.7 percent in April after having risen 0.2 percent in March. Manufacturing output fell 0.8 percent in April.
 
As was the case in March, factory output in April was held down by a large drop in the index for motor vehicles and parts; strikes and strike-related parts shortages resulted in suspended production at many facilities.
 
Excluding motor vehicles and parts, manufacturing production fell back 0.4 percent after having increased 0.3 percent in March.
 
In April, the output of utilities rose 0.3 percent, and the output at mines decreased 0.8 percent. At 111.2 percent of its 2002 average, overall industrial production was 0.2 percent above its year-earlier level.
 
The rate of capacity utilization for total …

Industrial Production Falls in April Read More »

ITW Sales Grow 11.5%

Illinois Tool Works Inc., Glenview, IL, reported operating revenue increased 11.5% for the quarter ended April 30, 2008. Growth in revenues was primarily due to contributions from translation and acquisitions.

By segment:
Industrial Packaging +14.9%
Power Systems and Electronics +8.9%
Transportation +11.5%
Construction Products +2.7%
Food Equipment +25.1%
Polymers and Fluids +27.8%
Decorative Surfaces +3.3%
All Other +8.6%
 
Above numbers include base revenues, acquisitions/divestitures and currency translation.
 
With $16.2 billion in revenues, ITW is a diversified manufacturer of highly engineered components and industrial systems and consumables. The company consists of 825 business units in 52 countries and employs some 60,000 …

ITW Sales Grow 11.5% Read More »

Rexel Organic Growth at 3.1% in 1Q

Rexel reported 3.1% organic growth (on a constant and same-day basis) for the first quarter 2008, with profit up 27.2% from the year-ago period.
 
Sales in the first quarter were €2.5 billion, compared with €2.4 billion a year ago.
 
Sales were up 3.7% in Europe, led by Northern Europe and the United Kingdom. North America had growth of 1.2%. In Asia-Pacific, growth was 8.2%.
 
In the quarter, Rexel completed its acquisition of Dutch distributor Hagemeyer …

Rexel Organic Growth at 3.1% in 1Q Read More »

Samuel Son & Co. Agrees to Buy Namasco

Metals distributor Samuel, Son &Co., Ltd., Mississauga, Ontario, has agreed to buy Namasco Limited, the Canadian subsidiary of Klockner &Co. AG of Duisburg, Germany.
 
Samuel, Son &Co. operates 45 facilities throughout North America and has locations in Australia, The United Kingdom and …

Samuel Son & Co. Agrees to Buy Namasco Read More »

Human Due Diligence’ in M&A

A recent article in the Wall Street Journal (subscription required) says that executives who don’t conduct thorough “human due diligence” before completing an acquisition can suffer “steep long-term attrition.”

One featured researcher says that in a recent study, he found targeted companies lose close to 21% of their managers each year, more than double the turnover experienced in non-merged firms, for at least 10 years after an acquisition. The article goes on to say that though no two companies manage employees and operations in exactly the same way, the more their decision-making styles and value overlap, the more they will benefit from the merger. …

Human Due Diligence’ in M&A Read More »

Applied Industrial Agrees to Buy Mexican Firm

Applied Industrial Technologies, Cleveland, OH, has agreed to acquire Suministros Industriales Enol, S.A. de C.V. and its group of companies.
 
Enol is one of Mexico’s largest distributors of power transmission products including bearings, hydraulic hose, electric motors, conveyor products, and lubricants, and had sales of US$25 million in 2007.
 
It operates 10 service centers in Saltillo, Monterrey, San Luis Potosi, Queretaro, Silao, Toluca, Tlalnepantla, Puebla, Tehuacan, and Merida. The company has 145 employees and serves a broad segment of industrial customers including steel, cement, pulp and paper, sugar, and others.
 
With this acquisition, Applied Mexico will serve Mexican industry through 17 service centers and three sales offices in 13 …

Applied Industrial Agrees to Buy Mexican Firm Read More »

M&A Deal Activity in Industrial Products Slows

Weakness in the U.S. economy continues to affect M&A deal activity and value in the industrial products sectors, specifically industrial manufacturing, chemicals, and metals, according to a series of PricewaterhouseCoopers LLP first quarter M&A reports.

While deal activity remains steady, deal volume and value is not on pace to exceed 2007 levels; however, the number of deals announced during the quarter is on track to meet or exceed 2006 levels.
 
The slowdown in the pace of large deals announced in the first quarter is a direct reflection of the difficult financing environment. Only the transportation &logistics sector is on pace to exceed the level of large deals in both 2006 and 2007. Deal interest for targets in Asia has been particularly strong during the …

M&A Deal Activity in Industrial Products Slows Read More »

HD Supply Waterworks Opens New Facility in Georgia

HD Supply Waterworks, an HD Supply business, has opened a 15,000-square-foot facility in Brunswick, GA.
 
The new location features a warehouse, office space and tool showroom. The company has also consolidated two existing local branches into its Savannah-area facility in Pooler, GA.
 
The Brunswick and Savannah locations also feature tool showcases, stocking items such as pipe slings and cutters, diamond-tipped saw blades, ladders, shovels, trowels and a wide array of other products utilized in the Water and Sewer industry.

HD Supply Waterworks distributes water, sewer, fire protection and storm drain products, integral to building, repairing and maintaining water and wastewater systems.  It currently operates more than 260 branches in 41 …

HD Supply Waterworks Opens New Facility in Georgia Read More »

Associations Face Value Challenges

Distribution associations, like most of their members, have been challenged to redefine and focus the value they deliver. Many associations have initiated a strategic planning process to address shrinking membership and participation due to industry consolidation, as well as new competition in the form of marketing groups and other alternate education resources, including trade publications.
 
I recently attended the Fluid Power Distributors Association (FPDA) annual meeting, where they unveiled the results of a three-year strategic planning process. The fluid power industry has been particularly challenged as new electro-mechanical technologies have rapidly developed. In a nutshell, they are aiming to elevate the networking and education value the association can offer, while …

Associations Face Value Challenges Read More »

Building Materials Holding to Discontinue AZ Framing/Concrete Operations

Building Materials Holding Corp., San Francisco, CA, a provider of building materials and construction services to professional residential builders and contractors, announced that is wholly-owned subsidiary SelectBuild Arizona will discontinue its residential framing and concrete operations in Tucson, AZ, on July 18.
 
The difficult decision to discontinue our residential framing and concrete operations in Tucson is a necessity based on today’s challenging business environment and weakness in the Tucson housing market,” said President Stanley M. Wilson. “Housing permits in the Tucson market have fallen sharply from 1,349 in the first quarter of 2007 to only 738 in the first quarter of 2008. Tucson has been hit particularly hard by the downturn in the housing market, and we …

Building Materials Holding to Discontinue AZ Framing/Concrete Operations Read More »

RONA Same-Store Sales Drop 5.2% in 1Q

Quebec-based RONA, distributor and retailer of hardware, renovation and gardening products, reported a 3.8% increase in sales to $911.5 million in the first quarter 2008. Same-store sales declined by 5.2% in the first quarter of 2008.
 
Profit was $1 million, compared with $9 million in the year-ago period.
 
RONA said that economic and weather conditions that were especially unfavorable to construction/renovation activities, particularly in Eastern Canada, largely explain this drop in same-store sales and profits. Results were also affected by a decline in starts of single family homes in Canada and a temporary slowdown in the demand for building materials in Alberta.
 
The results for first quarter 2008 reflect the strong drop in consumer confidence in …

RONA Same-Store Sales Drop 5.2% in 1Q Read More »

Graybar Sales Grow 4.8% in 1Q

Graybar, St. Louis, MO, distributor of electrical and communications products and related supply chain management and logistics services, reported sales grew 4.8% in the first quarter 2008 to $1.28 billion from the same period a year ago. Profit was $18.9 million, a 58.7% increase.
 
The increase was due to modest growth in electrical market sales coupled with a solid growth in the data communications market.
 
During this economic slowdown, we see customers leveraging our distribution services more than ever to lower their total cost of ownership,” said Robert A. Reynolds Jr., president and CEO of Graybar.
 
Reynolds added that Graybar continues to invest in technical resources to help its customers manage the implementation of complex projects such as …

Graybar Sales Grow 4.8% in 1Q Read More »

Transport/Logistics Deal Volume Falls in 1Q

Both deal volume and value in the transportation and logistics industry declined during the first quarter of 2008, according to the PricewaterhouseCoopers LLP Q1 2008 edition of Intersections: Global Transportation &Logistics Mergers and Acquisitions Analysis. Global Deal activity is not on track to match the levels seen in 2007; however, the 45 deals (worth at least $50 million each) announced in the first quarter are on track to exceed 2006 levels.
 
The credit markets and slowing deal activity in the U.S. significantly affected deal volume in the first quarter of the year. When excluding deals in which a U.S. entity was the acquirer or target, the number of deals (38 deals) is on pace to exceed both 2006 and 2007 levels (119 and 142 deals respectively), indicating that a …

Transport/Logistics Deal Volume Falls in 1Q Read More »

DXP Enterprises Organic Growth of 13.5% in 1Q

DXP Enterprises, Inc. reported sales increased 101.5% to $168.5 million in the first quarter 2008, due mostly to sales by four businesses acquired in 2007 and 2008, including Precision Industries. Profit was $5.4 million.
 
Excluding sales from acquired businesses, sales for the first quarter were up 13.5%. Organic sales growth was primarily due to an increase in sales of pumps, bearings, safety products and mill …

DXP Enterprises Organic Growth of 13.5% in 1Q Read More »

Park-Ohio Sales Flat in 1Q

Park-Ohio Holdings Corp., Cleveland, OH, reported sales of $267.1 million for the first quarter 2008, unchanged from the first quarter 2007.
 
Park-Ohio reported profit of $3.5 million, down slightly from the year-ago period.
 
We anticipated a slow start in 2008, with softness in our Supply Technologies and Aluminum Products segments,” said Edward F. Crawford, CEO. “Our international industrial equipment business continues to be robust.”
 
Park-Ohio is a provider of supply management services and a manufacturer of highly engineered products. The company operates 24 manufacturing sites and 55 supply chain logistics …

Park-Ohio Sales Flat in 1Q Read More »

Parker-Hannifin Buys Remaining Stake in Parker Seal de Mexico

Parker Hannifin Corp., Cleveland, OH, supplier in motion and control technologies, has acquired the remaining stake in its joint venture, Parker Seal de Mexico. Parker held a 49% stake in the $8.3 million revenue company prior to acquiring the remaining interest from multiple joint venture partners.
 
The acquired operation will become part of Parker’s Seal Group, and its results will be reported within the Industrial North America business segment. Now, as the sole owner of this operation, Parker can sell any of its thousands of seal products into the Mexican market,” said Heinz Droxner, president of Parker’s Seal Group. “This is part of our long-term strategy to serve customers who have operations in Mexico, and positions Parker to meet all of their sealing requirements …

Parker-Hannifin Buys Remaining Stake in Parker Seal de Mexico Read More »

Building Materials Holding Corp. Sales Fall 37% in 1Q

Building Materials Holding Corp., San Francisco, CA, provider of construction services and building materials to professional residential builders and contractors, reported sales for the first quarter 2008 decreased 37% to $355 million from $559 million in the same quarter a year ago.
 
Net loss for the first quarter 2008 increased to $33.9 million from a net loss of $5.0 million in the same quarter a year ago.
 
Challenging industry conditions continued across U.S. homebuilding markets during the first quarter,” said Robert E. Mellor, CEO. “While the very difficult market conditions continued to impact our operating results, once again the distribution side of our business gained market share with sales declining less than single-family permits in its regions while …

Building Materials Holding Corp. Sales Fall 37% in 1Q Read More »

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!