Home renovation retailer Rona Inc. trimmed its losses in the first quarter to $13.3-million as revenues grew on the addition of stores and expansion of its commercial and professional division.
The Quebec-based company said it lost 10 cents per share for the 13 weeks ending March 25. That's down from 13 cents a year earlier when net losses were $17.6 million.
The loss was lowered due to a 38 per cent improvement in pre-tax earnings (EBITDA), lower depreciation and financing costs.
Total revenues increased by 1.8 per cent to $934.9-million, stemming from higher distribution sales, store openings and the expansion of its commercial and professional market division.
Overall same-store sales decreased 0.8 per cent on weaker results in January but improvement in February and March.
Comparable sales for larger retail outlets that sell lower margin building materials rose 4.2 per cent while proximity stores were up 2.2 per cent.
Rona was expected to lose nine cents per share on $917-million revenue, according to analysts polled by Thomson Reuters.
President and CEO Robert Dutton said the improvement in building materials sales bodes well for the coming months because it usually signals the start of larger construction and renovation projects.
He added that the trend of improving same-store sales continued in April.
"Despite the trend reversal in same-store sales since the end of fiscal 2011, it is clear that consumers are still cautious," he stated.
"However, we are encouraged by the early start to the season in our industry and are counting on our effective marketing, merchandising and in-store service programs, as well as our more targeted approach in the regions, to entice Canadian consumers to make Rona their primary destination for their renovation projects."
Rona says it is the largest Canadian distributor and retailer of hardware, home renovation and gardening products. It operates a network of close to 800 corporate, franchise and affiliate stores, and a network of 14 hardware and construction materials distribution centres.
With close to 30,000 employees, Rona and its franchise dealers generate $4.8-billion of annual sales.