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LFL 2Q earning up 12%

13 August 2018
Appliances, By the Numbers, Furniture, Mattresses, People

TORONTO – Leon’s Furniture Limited (LFL), this country’s largest full-line furniture retailer, reported a modest uptick in sales and revenue but a double-digit gain in earnings for both the second quarter and first half of 2018. It then said president and chief operating officer Edward Leon would become chief executive officer later this year.

LFL is the parent company to both the Toronto-based Leon’s Furniture and The Brick, the high impact promoter headquartered in Edmonton.

System-wide revenue for the three months ending 30 June 2018 were $650.0 million, up 2.0% from the $637.5 million for the same period last year.

Edward Leon (right), seen here accepting the 2017 Retailer of the Year Award from Laine Reynolds, then chairman of the Canadian Home Furnishings Alliance, will become president and chief executive officer of Leon’s Furniture Limited on 01 October.Corporate store sales were $546.7 million, up 1.5% from $538.9 million. Same store sales grew 0.4%.

Meanwhile, sales by the company’s 100 franchise store network were up 4.9% to $103.3 million, compared to $98.6 million for the second quarter of 2017.

Adjusted net income was $22.6 million or 28 cents per diluted share, compared to $20.0 million or 25 cents per diluted share – up 12% on a per share basis.

For the six months also ending 30 June 2018, LFL’s system-wide revenues were $1.25 billion, up 3.3% from the $1.21 billion for the first half of 2017.

Corporate store sales were $1.05 billion, a 2.4% gain from last year’s $1.02 billion as same store sales advanced 1.5%.

The franchise network continued to shine as it sales reached $203.7 million, an uptick of 8.1% from $188.4 million.

Adjusted net income was $34.1 million or 42 cents per diluted share, compared to $28.5 million or 36 cents per diluted share – up 16.7% on a per share basis.

Edward Leon, who will take up the CEO’s post on 01 October 2018, said in a statement that the company continued to produce “significant” operating leverage during the first half of the year, putting it in a solid position for growth.

“For the balance of 2018 and into 2019 our team will remain focused on select initiatives to drive traffic and average ticket, with robust cost control and efficiencies,” he added. “We are well-positioned to continue to generate meaningful value for our shareholders over the next several years, leveraging our national retail bricks and mortar footprint, service related companies, real estate portfolio, successful online properties and industry-leading distribution infrastructure.”

Terry Leon, who has been CEO for the past 15 years or so is retiring and will become vice chairman of the publicly-held but largely family managed retailer’s board of directors.

The company also announced it has received permission from the Toronto Stock Exchange (TSX) to renew is Normal Course Issuer Bid for the 12 months beginning 10 September 2018. Under the bid, the company intends to purchase for cancellation as much as 4.99% of its outstanding common shares. There are about 86 million common shares outstanding.

At the end of June, LFL operated a total of 304 stores across the country, under five banners: Leon’s, Appliance Canada; The Brick; The Brick Mattress Store; and, Brick Outlet. It also has three e-commerce sites: leons.ca; thebrick.com; and, furniture.ca.

Miele opens Toronto store

13 August 2018
Appliances, Retail

TORONTO – Miele Canada has opened its fifth Experience Centre in Canada, but the first in a premium shopping centre and the first to offer consumers its new retail concept and design, which is focused on allowing shoppers to experience the major appliance brand with all of the senses.

The company said the concept is relatively simple: digital first while remaining human at heart. This most modern Miele Experience Centre will rely on a combination of digital elements, product experience and expert advice.

Miele recently opened its fifth Canadian Experience Centre at Toronto’s Yorkdale Shopping Centre. It’s the first to be opened in a premium shopping centre.“The new Miele Experience Centre is truly a unique showcase demonstrating excellent quality, technology and service,” Yves Dalcourt, president of Miele Canada, said in a statement. “The experience we will give our customers will change the way people will look at buying appliances and will set a new standard within our industry.”

Visitors will be welcome to try out the appliances on display and discover the user benefits they offer. From laundry and floorcare appliances to kitchen products through to Smart Home, all Miele product categories are represented. This is a full retail store where customers can purchase all products.

The heart and soul of the new store is the active kitchen area. Cooking and baking demonstrations take place several times a day. Freshly prepared culinary treats from croissants to homemade soups can be sampled by customers during their visit. The lounge area adjacent to the kitchen is an invitation to linger and enjoy the atmosphere.

In terms of store design, Miele relies on warm and natural materials which exude a homelike feel. The lighting and ambient videos on five screens in the store change to reflect the time of day.

Various digital elements further induce interaction with products or provide additional information. At the new Swiping Cooktop Screen, it is possible, for example to perform virtual cooking and to experiment with the various Miele induction cooktops on display. The 46-inch touch screen display on the M-Touch Wall shows the product range with the eponymous technology in full size and illustrates the function of the controls which simplify the operation of numerous built-in appliances.

Also new is the Miele CareCollection Consumables Wall. With the aid of short videos, this feature informs visitors about the various Miele cleaning and care products. Videos are launched by scanning items using the NFC scanner provided.

Whilst the four other Miele Experience Centres in Canada – located in Calgary, Montreal, Toronto and Vancouver – offer large-scale showrooms in edge-of-town locations, the new store is the brand’s first location in a well-frequented premium shopping mall.

“We are extremely excited about our partnership with Yorkdale Shopping Centre and believe that this new location will make the Miele brand even more accessible to even more consumers,” Dalcourt said.

The Yorkdale Shopping Centre has approximately 18 million visitors per year and is home to several high-end furniture and home and home furnishing retailers including RH, Crate & Barrel, Pottery Barn and Williams-Sonoma, among others.

Dalcourt also said the new endeavour demonstrates Miele’s commitment to the Canadian market where demand for its world-leading, premium appliances continues to grow.

Aussie high-end retailer sets sights on Vancouver

13 August 2018
Furniture, Retail

VANCOUVER – King Living, the high-end Australian furniture retailer, is expected to open its first Canadian store in this city’s ‘South Granville’ shopping district sometime in few weeks.

According to Retail Insider and confirmed by a company official in an e-mail, it will open a two-story store in its first foray into North America, although it already operates outside of Australia in New Zealand, Malaysia and Singapore. In all, it operates 18 stores, 15 in Australia.

A view of a King Living store in Australia. The high-end retailer will open its first Canadian store sometime this fall.Founded in 1977 in Sydney, Australia, the privately-held King Living is best known in its home market for its high quality, well designed contemporary leather and fabric upholstery – much of which it designs and manufactures in its own factories. Their upholstery features steel frames; ‘comfort seat suspension’ as well as removable covers. In 1987, it introduced the Postureflex seating system, which is similar to the suspension used in luxury European car brands such as Rolls Royce.

In addition to upholstery, the product mix includes mattresses – branded under the King Living label and retailing at an opening price point of AU$5,000; bedroom furniture, dining room; occasional case goods; rugs; accessories and outdoor furniture.

The company has won number awards – such as the Sydney Hills Business Award in 2016. But it has also won several design awards for its product assortment, which were also once featured on Oprah Winfrey’s television show.

Fittingly, King Living’s first Canadian store will be located in Vancouver’s affluent West Side and join an expanding list of international brands looking to gain a foothold in this country by setting up shop in the rapidly gentrifying Gastown area.

Retail Living reports the retailer will lease a total of 10,610 square feet – an entire two-story building at the northwest corner of Granville Street and W 15 Avenue, not far from some of Vancouver’s wealthiest neighbourhoods, where home prices have reached more than $20 million. Indeed, the entire West Side is now considered to hold nothing but prestigious residential addresses with an average home price of $3.4 million which ranks it has the most expensive in the country, if not North America.

Other area retailers cater to affluent locals, with nearby store locations for brands such as Max Mara, the Italian fashion house; cookware specialist Le Creuset; and Boboli, a Vancouver-based high-end clothier. This fall, luxury children’s brand Bonpoint is expected to open its first store in Canada nearby on West 14th Avenue.

GoEasy earnings up 30%

13 August 2018
By the Numbers, Retail

MISSISSAUGA, Ontario – GoEasy, parent to this country’s largest lease-to-on merchant, said the second quarter of 2018 was its 33rd consecutive quarter of same store sales growth as revenue jumped 26.4% and earnings 30.2%. As had been the case for several years now, growth was driven by the expansion of its short-term consumer loans business.

For the three months ending 30 June 2018, revenue was $123.3 million, up 26.4% from $97.5 million for the same period a year ago.

Revenue from EasyFinancial, its consumer loan provider, was $89.0 million – a 41.4% leap from $63.0 million for the second quarter of 2017.

Meanwhile, rent-to-own merchant EasyHome saw its sales slide 0.7% to $34.3 million compared to $34.6 million a year ago.

Same store sales were up 28.4%. This metric fell to 6.9% when EasyFinancial is excluded.

Net earnings were $11.8 million or 82 cents per share compared to $8.9 million or 63 cents per share – a 30.2% advance on a per share basis.

“Our strategy of providing everyday Canadian consumers access to the funds they need, while helping put them on a path back to prime rates and better financial outcomes, continues to resonate,” GoEasy chief executive officer David Ingram said in a statement.

For the six months that also ended on 30 June 2018, revenues were $238.1 million, up 24.2% from $191.8 million for the 2017 period. EasyFinancial revenue was up 38.2% to $169.4 million while Easyhome was off a slight 0.8% at $68.7 million.

Same store sales for the first half grew 26.0% – but fell to 6.1% when EasyFinancial is taken out.\

Net earnings were $22.9 million or $1.58 per share, compared to $19.2 million or $1.36 per share – up 16.2% on a per share basis.

During the first six months, the company closed six EasyHome stores and opened ten EasyFinancial locations.

The ongoing success of EasyFinancial has prompted the company to update its expansion plans. Ingram said they now expect their consumer loans portfolio to breach the $1 billion mark sometime in 2019, before climbing to as much as $1.4 billion in 2020. They will open as many as 20 new EasyFinancial locations this year and will open as many as 20 more in each of the next two years.

At the end of June, GoEasy operated a total of 237 EasyFinancial locations as well as 165 EasyHome stores, including 31 franchise locations.


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