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Canadian home improvement retailer RONA Inc. reported a decline in same-store sales and revenues in the fourth quarter 2013 and fiscal 2013 overall, a result of the “closure of the company’s underperforming stores and the difficult market conditions throughout the industry,” according to the company.
Revenues for fiscal year 2013 from continuing operations were reported at $4.2 billion, compared to $4.4 billion in 2012, with same-store sales down 1.9 percent over 2012. Fourth quarter 2013 revenues of continuing operations were reported at $941.1 million, compared to $1.07 billion in 2012 with same-store sales down 3.5 percent. “Fiscal 2013 was a year of profound organizational change at RONA, against the backdrop of a difficult market context for our industry,” says Robert Sawyer, president and chief executive officer of RONA. “Although consolidated results are down, we are satisfied with the progress made in the implementation of the restructuring measures and the team reorganizations. We are particularly proud to have achieved our primary objective of $110 million in cost savings on an annualized basis.”
On an adjusted basis, the company’s recovery plan, including the effect of the additional week of activity in 2012, resulted in a reduction of selling, general and administrative expenses by $67.2 million, mainly through the closure of underperforming stores. Net of the gross margin lost following the closure of these stores, the recovery plan saw an increase of $34.2 million in 2013.
“In 2014, we will focus on deploying the new positioning of some banners and stabilizing our profit margins after having revised the pricing strategy and disposed of some excess inventory in 2013,” Sawyer said. “Most importantly, we will concentrate on meeting the needs of our target customers so that we can increase our market share in an industry that is experiencing a cyclical slowdown.”
