(Montreal) The action of Quincaillerie Richelieu jumped nearly 8% after the unveiling of better-than-expected results on Thursday. The Montreal company continues to benefit from the strength of the renovation market, particularly in the manufacturer market.
Updated yesterday at 4:31 p.m.
President and CEO Richard Lord believes that sales in the manufacturer market will continue to be strong over the next year. Sales in this segment increased by 27.8% to 265.1 million.
“The best indicator we have is from our sellers,” he told an analyst who wondered if the observed trend was temporary, during a conference to discuss fourth-quarter results. “They are constantly in contact with our manufacturing customers. They confirm to us that our customers are very busy and that they will be busy for the rest of the year. »
Inflation could be a cloud on the horizon, he admits, but “you have to remember that people have accumulated a lot of money during the pandemic”.
The strength of this segment offsets the “return to normal” in the retail market, where sales are comparable to a period when the enthusiasm for personal renovation projects was unprecedented.
Same-store sales in the retail market are down, but acquisitions have offset the decline in existing business. The segment thus recorded a 10.4% increase in sales to 59.5 million. “You have to keep in mind that we are comparing ourselves to a very strong year,” says Antoine Auclair, the company’s chief financial officer. We expect to return to a more normal comparison in year two. »
Results above expectations
Meaghen Annett of TD Securities welcomes the results. “Growth in the manufacturers’ market remains strong as retail sales are more resilient than we anticipated. »
For the fourth quarter (ended November 30), the Montreal company announced net income attributable to shareholders up 64.6% to 44.6 million, compared to the same period last year.
Adjusted net earnings per share reached $0.79, compared to $0.48 for the same period last year. Sales, meanwhile, rose 24.8% to 398.2 million.
Prior to the earnings release, analysts had expected revenue of $366.7 million and earnings per share of $0.62, according to data from the firm Refinitiv.
Sales are up, both in Canada (21%) and the United States (39.3%), reaching 260.1 million and 109.9 million US, respectively.
The company said it completed five acquisitions in fiscal 2021, which together represent annual sales of $80 million. She also claimed to have bought three other companies since the end of the financial year for sales estimated at 100 million. “Antoine didn’t have the right to his Christmas vacation,” joked Mr. Lord.
The company also announced an 86% increase in its quarterly dividend to 13 cents.
The stock closed up $3.69, or 8.3%, at $48.35 on the Toronto Stock Exchange on Thursday.