Ace posts 13.9% decline in Q3 sales

Oak Brook, Ill. Ace Hardware has reported its third quarter 2009 fiscal year results, posting total revenues of $832.6 million. This is a 13.9% decrease from $967 million in the same quarter of 2008.

For the nine-month period ended Oct. 3, total revenues were $2.7 billion, an 8.5% decrease from a year ago.

Ace reported net income of $26.7 million for third quarter 2009, a 1.0% increase over income of $26.4 million in the same quarter last year.

For the nine-month period ended Oct. 3, net income was $83.3 million, an 18% increase over the corresponding period of 2008.

Merchandise sales to comparable domestic stores in third quarter 2009 decreased $99.6 million, primarily due to a soft economy, the company said. On a regional basis, sales were most negatively impacted in the Gulf Coast region, which experienced a decline of hurricane-related merchandise sales compared with the prior-year period.

On a category basis, domestic sales were most negatively impacted by declines in the plumbing, electrical and hardware categories. Declines in tools, electrical and hardware were partially offset by increases in the lawn and garden category, the company said.

Merchandise sales to new domestic stores activated in the 2008 and 2009 fiscal year periods contributed $12.1 million in incremental sales in the current year’s third quarter. Ace added 24 new stores and cancelled 43 stores in the third quarter, resulting in a net loss of 19 stores. This brought the company’s total store count to 4,511 at the end of third quarter 2009.

Ace’s international business, as measured by merchandise sales, decreased $12.2 million, or 21.8%, in third quarter 2009 as compared with the prior year’s quarter. On a regional basis, international sales were most negatively impacted by declines in the South America, Middle East and Pacific Rim regions due to a slow global economy. On a year-to-date basis, international sales decreased $30.3 million, or 19.9%.