LANGLEY, B.C.— Hardwoods Distribution Inc. generated record second quarter profit of $9.8 million, an 81.9 per cent increase compared to Q2 2016, on the strength of acquisitions. Organic second quarter revenue increased $8.6 million, or 5.5 per cent, year-over-year.
Hardwoods is North America’s largest wholesale distributor of architectural grade building products to the residential and industrial construction markets, with a strong US and Canadian distribution network.
“We achieved the best quarterly top and bottom line results in Hardwoods’ history as we continued to benefit from accretive acquisitions and achieved solid organic growth,” said Rob Brown, president and CEO of Hardwoods.
Sales in Canada for Q2 2017, which comprise approximately 13 per cent of second quarter revenues, grew by $1.2 million, or 3.6 per cent to $35.2 million. The improvement in Canadian sales reflects organic growth.
Results for the second quarter include the positive impact of Hardwoods’ previous acquisition of Rugby Architectural Products. Acquired in July 2016, Rugby brought Hardwoods 28 US distribution facilities across 40 states and contributed US$77.3 million of revenue to second quarter 2017 results.
Discussing the market outlook, the company’s statement says: “Consistent with the first half of the year, we anticipate mid-single digit organic growth in the remainder of 2017. At 1.2 million, US housing starts remain well below the 1.5-to-1.6 million level considered to be normal and sustainable for the industry. Accordingly most forecasters predict a continued gradual strengthening trend for the US residential construction market…The highly fragmented US architectural buildings product distribution industry also provides numerous opportunities for further acquisition-based growth.”
“Having now completed six successful acquisitions in the past six years, we are confident in our ability to identify and act on opportunities and to effectively integrate these new businesses into our operations. We will continue to pursue our acquisition strategy going forward,” said Brown.