Rona Falls Most Since May as Quarterly Profit Trails Estimates
Rona Inc. (RON), Canada’s largest home-improvement store chain, fell the most in three months after posting second-quarter earnings that trailed analysts’ estimates, hurt by poor weather and a construction strike.
Rona dropped 2.8 percent to C$10.94 at 10:59 a.m. in Toronto after earlier falling as much as 4.5 percent for the biggest intraday decline since May 14. The shares rose 5.5 percent this year through yesterday, compared with a 1.7 percent gain in the Standard & Poor’s/TSX Composite Index.
A decline in single-unit housing starts across the country and a June strike in the Quebec construction industry created “difficult market conditions” during the quarter, Boucherville, Quebec-based Rona said in a statement today.
Adjusted earnings per share of 28 cents trailed the 33-cent average of analysts’ estimates compiled by Bloomberg. Sales were C$1.25 billion ($1.21 billion), a drop of C$59.6 million. Same-store sales were down 1 percent, the company said.
The net loss from continuing operations was C$38.7 million compared with a profit of C$35.6 million in the quarter a year earlier. The company booked C$62.8 million in expenses such as restructuring.
“The results presented today are lower than in 2012, given the unusual items with respect to the current restructuring, the same of assets, investments in promotions and inventory liquidation,” said Robert Sawyer, the company’s chief executive officer, said today in a statement.
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