Sept. 16/23 2013; Volume 27/number 11
CLIFTON’S CHAIR: Janice Clifton, owner of Abbey Carpets Unlimited, Napa, Calif., recently became chairwoman of the World Floor Covering Association (WFCA). She fills the role of chairman vacated by Harold Chapman, Bonitz Flooring Group, Greenville, S.C., who became immediate past chairman. At a board meeting in Asheville, N.C., directors also elected Paul Johnson of Interiors One Carpet One, Tulsa, Okla., as chairman-elect; confirmed Mark Weaver, Carpet Weavers, Bloomington, Ill., as secretary; chose Scott Walker, Walkers Carpet One, Bellingham, Wash., as CFO; voted Aaron Pirner, CAP Carpet, Wichita, Kan., as vice chairman, and named Tom Jennings as past chairman.
WFCA elects a third of its directors each year for three-year terms. In addition to re-electing Johnson, WFCA members re-elected Deb DeGraaf and Terry Wheat. Pirner was elected to serve an unexpired two-year term. Newly elected directors to three-year terms include Jason Fromm, Carpet Spectrum, Lomita, Calif.; Dean Howell, Moda Floors and Interiors, Atlanta, and Melissa Murphy, Johnston Paint & Decorating, Columbia, Mo. Associate directors re-elected Bob Weiss, president/CEO of All Tile, to a three-year term as an associate director. Elected to serve an unexpired two-year term was Paul Murfin, co-CEO, IVC US.
HOME IMPROVEMENT: According to the National Association of Home Builders (NAHB)/First American Improving Markets Index (IMI), a total of 291 metropolitan areas across the country now qualify as improving housing markets. This reflects a gain of 44 markets from August and marks the index’s highest level since it was initiated two years ago. The IMI identifies metropolitan areas that have shown improvement from their respective channels in housing permits, employment and house prices for at least six consecutive months. “Just over 80% of the 361 metros tracked by our index are showing consistent growth in three key measures of housing market strength—prices, permits and employment,” said NAHB chairman Rick Judson. “While there is still plenty of room for growth, this is an excellent indication of how the housing recovery has begun to take hold across more geographic areas.” NAHB chief economist David Crowe noted, “The broadened list of metros on the IMI continues to demonstrate the slow but steady gains that individual housing markets are making to bolster the national outlook.”
LOWE’S HIGH: Lowe’s reported that its second-quarter net income rose 26%, thanks to the housing market recovery. Like Home Depot, the home-im-provement chain’s results beat expectations and the company recently raised its earnings and revenue forecasts. Lowe’s earned $941 million, or $0.88 per share, up from $747 million, or $0.64 per share, a year ago. Sales rose 10% to $15.71 billion from $14.25 billion. Revenue at stores that have been open at least a year rose 9.6%.
TOLL JUMPS: Luxury homebuilder Toll Brothers reported a 24% increase in third-quarter revenue. However, order growth at Toll slowed to 26% in the third quarter, which ended July 31, from 36% in the second quarter and 49% in the first. Toll said its average selling price rose 13% to $651,000. “We believe the recovery is real and we are in the early stages of the rebound,” said Toll CEO Douglas Yearley. Net income fell to $46.6 million, or $0.26 per share, from $61.6 million, or $0.36 per share, a year earlier, on a tax expense. Revenue rose 24% to $689.2 million.
BUILDERS’ INCENTIVE: Larger home builders are turning to in-house financing incentives to spur sales, according to a story by Bloom-berg News, as rising interest rates are making their homes less affordable. And rather than cut prices, the firms, like Lennar and Pulte, are leaning on their financing arms to offer incentives, along with offering flooring or kitchen upgrades. Bloomberg outlined one situation in which Lennar covered a couple’s loan costs and cut half a percentage point off their interest rate if they used its in-house financing.