Ace Hardware Reports Record Revenues for 4Q, 2020
Ace Hardware Corp. reported record fourth quarter 2020 revenues of $2.1 billion, an increase of $577.6 million, or 39.2 percent, from the fourth quarter of 2019. Fiscal 2020 consisted of 53 weeks compared to 52 weeks in fiscal 2019. Excluding the 53rd week, revenues in the fourth quarter increased $477.7 million, or 32.4 percent, from the fourth quarter of 2019. Net income was $43.1 million for the fourth quarter of 2020, an increase of $39.6 million from the fourth quarter of 2019.
Full-year revenues were a record $7.8 billion, an increase of $1.7 billion, or 27.9 percent, from 2019 revenue (an increase of $1.6 billion or 26.2 percent excluding the 53rd week). Net income for fiscal 2020 was $316.9 million, an increase of $176.5 million, from fiscal 2019.
“The fourth quarter was yet again one of the most extraordinary in Ace’s history,” said John Venhuizen, president and CEO. “We’ve always believed that we were blessed to be in the business of serving others. And now, after a year like 2020, we feel blessed to be an essential retailer with strong suppliers, an expansive supply chain and amazing people. Ace employees in our stores and our warehouses withstood the massive surge in demand as consumers channeled a disproportionate share of their discretionary spending into their homes and gardens.”
He added, “My deep appreciation and gratitude to the Ace team for the protection of their people, the safety of our customers and what I believe to be the most helpful service of any retailer on the planet.”
The 28.7 percent increase in retail same-store-sales during the fourth quarter of 2020 reported by the approximately 3,300 Ace retailers who share daily retail sales data was the result of a 16.4 percent increase in average ticket and a 10.5 percent increase in same-store transactions. The 25.9 percent increase in retail same-store-sales for the full year was the result of a 14.7 percent increase in average ticket and a 9.8 percent increase in same-store transactions.
Consolidated revenues for the quarter ended January 2, 2021 totaled $2.1 billion. Total wholesale revenues were $1.8 billion, an increase of $516.2 million, or 38.7 percent, as compared to the prior year fourth quarter. Wholesale merchandise revenues to new domestic Ace stores activated from January 2019 through December 2020 contributed $47.9 million of incremental revenues during the fourth quarter of 2020, while wholesale merchandise revenues decreased $9.8 million during the fourth quarter due to domestic Ace stores whose memberships were cancelled. Wholesale merchandise revenues to comparable domestic Ace stores increased $402.8 million for the quarter. Increases were noted across all departments, with grilling, paint, hand and power tools, and outdoor power equipment showing the largest gains.
The Company’s Ace International Holdings (AIH) subsidiary experienced a $7.0 million increase in wholesale revenue versus the fourth quarter of 2019, while Ace Wholesale Holdings (AWH) reported a $25.7 million increase in wholesale revenues from the fourth quarter of 2019.
Total retail revenues for the quarter were $203.6 million, an increase of $61.4 million, or 43.2 percent, as compared to the prior year fourth quarter. Retail revenues from Ace Retail Holdings (ARH) were $177.2 million in the fourth quarter of 2020, an increase of $55.8 million, or 46.0 percent, from the fourth quarter of 2019. The Westlake Ace Hardware chain experienced a 25.6 percent increase in same-store-sales during the quarter, while the Great Lakes Ace Hardware chain grew same-store-sales by 31.6 percent in the quarter. The 11 new California stores opened by Westlake in 2019 contributed $14.5 million of the increase. Westlake and GLA together operated 202 stores at the end of the fourth quarter of 2020 compared to 186 stores at the end of the fourth quarter of 2019. Retail revenues from Ace Ecommerce Holdings LLC were $26.4 million in the fourth quarter of 2020. This was an increase of $5.1 million from the fourth quarter of 2019, primarily driven by new customer acquisitions.
Consolidated revenues for fiscal 2020 totaled $7.8 billion, an increase of $1.7 billion, or 27.9 percent, as compared to the prior year. Total wholesale revenues were $7.0 billion, an increase of $1.5 billion, or 26.0 percent, as compared to the prior year.
Wholesale merchandise revenues from new domestic Ace stores were $204.1 million in fiscal 2020. This increase was partially offset by a decrease in wholesale merchandise revenues of $38.9 million due to domestic Ace store cancellations. Wholesale merchandise revenues to comparable domestic Ace stores increased $1.2 billion in fiscal 2020 compared to fiscal 2019. Increases were noted across all departments with grilling, paint, power tools and outdoor power equipment showing the largest gains. AIH wholesale revenues decreased $36.0 million compared to the prior year, as the global pandemic caused temporary store closures at AIH’s largest customers. AWH wholesale revenues increased $25.8 million compared to the prior year, which was primarily due to higher sales to e-commerce customers and traditional hardware stores.
Total retail revenues were $751.5 million, an increase of $244.8 million, or 48.3 percent, as compared to the prior year. Retail revenues from ARH were $704.4 million during fiscal 2020, an increase of $237.9 million or 51.0 percent. Westlake experienced a 24.7 percent increase in same-store-sales, while GLA grew same-store-sales by 32.7 percent during fiscal 2020. The 11 new California stores opened by Westlake in 2019 contributed $87.2 million of the increase. Retail revenues from AEH were $47.1 million during fiscal 2020. This was an increase of $6.4 million from fiscal 2019, driven primarily by new customer acquisitions.
Ace added 167 new domestic stores in fiscal 2020 and cancelled 76 stores. This brought the company’s total domestic store count to 4,647 at the end of fiscal 2020, an increase of 91 stores from the end of fiscal 2019. On a worldwide basis, Ace added 201 stores in fiscal 2020 and cancelled 104, bringing the worldwide store count to 5,463 at the end of fiscal 2020.
