True Value Company Announces 2008 Year-End Results

Tuesday, March 03, 2009

Maintains profit with modest sales decline

CHICAGO , March 3, 2009 – True Value Company today reported revenue of $2,012.7 million for the year ending January 3, 2009, a decrease of 1.4 percent or $27.9 million compared to $2,040.6 million for the prior year ending December 29, 2007. Revenue from new stores exceeded lost revenue from terminated stores by $1.9 million.

Comp store sales were down 2.1 percent during fiscal 2008. The 2008 fiscal year included an extra week in the fourth quarter compared to the standard 52-week operating calendar. Excluding the 53rd week, comp store sales were down 3.3 percent and revenue was down 2.4 percent or $49.2 million.

The co-op posted earnings of $64.2 million, an increase of 0.6 percent or $0.4 million versus $63.8 million one year ago. The 2008 earnings included a $3.0 million first quarter gain related to a previous arbitration matter. Excluding this gain, earnings were down 4.1 percent or $2.6 million. “During the economic recession, homeowners are doing more repairs and refurbishing their homes in lieu of selling. True Value retailers delivered the products, service and inspiration homeowners needed to complete their home repair projects,” said President and Chief Executive Officer Lyle Heidemann. “In fact, we enjoyed comparable store sales that outperformed the home improvement industry in 2008 on both a wholesale and retail basis.”

FOURTH QUARTER RESULTS
For the quarter ending January 3, 2009, True Value also reported revenue of $483.5 million, an increase of 0.9 percent or $4.3 million from $479.2 million for the same period in 2007. Excluding the 53rd week, fourth quarter revenue was down 3.5 percent or $17.0 million.

Earnings for the fourth quarter were $20.0 million, up 24.2 percent or $3.9 million from $16.1 million one year ago. The profit increase was primarily driven by higher product margins. Total year- end debt of $141.2 million increased 11.1 percent or $14.1 million from $127.1 million at the end of 2007.

True Value Company, headquartered in Chicago, is one of the world’s largest retailer-owned wholesale hardware cooperatives with sales of $2.0 billion in 2008. The cooperative includes approximately 5,400 independent retailer locations worldwide operating under the store identities of True Value, Grand Rental Station, Taylor Rental, Party Central, Home & Garden Showplace and Induserve Supply. Additional information on True Value is available at www.truevaluecompany.com.

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