Richelieu Hardware, a Canadian specialty hardware distribution and manufacturing company, has announced a 34% decline in net earnings for the third quarter. The company's profit decreased to 30.7 million Canadian dollars ($22.3 million), equivalent to C$0.53 per share compared to C$0.82 per share in the previous year.
The decline in earnings before interest, taxes, depreciation, and amortization (EBITDA) was attributed to lower sales and higher operating expenses. Richelieu reported an EBITDA of C$61 million, down 23% from the same period last year.
Consolidated sales also saw a decline of 2.9% in the third quarter, totaling C$459 million. However, this result was better than analysts' expectations, who predicted a steeper decline to $439 million.
Richelieu attributed the decline in sales to an internal decrease of 4.6%, offset by a positive contribution of 1.7% from recent acquisitions.
Operating costs were higher in the third quarter, primarily due to expenses related to external warehousing caused by a larger inventory. Additionally, the company was affected by the stronger U.S. dollar compared to the Canadian dollar, impacting its U.S. operating subsidiary.