Net margin surges at True Value

True Value, which ranked 10th on the 2009 HCN Top 150 Distributors Scoreboard, reported a big net margin gain on top of a sales decline in the second quarter.

The company pointed to lawn and garden as a strong category in the quarter ended July 4.

The Chicago-based hardware co-op posted revenue of $540.7 million, down 5.4% from revenue of $571.3 million in the same period last year. Comp-store sales to its core domestic hardware store outlets declined 2.2% in the quarter.

The company's quarterly net margin increased 50.3% to $27.8 million.

"Despite the challenging economy, True Value continues to outperform the home improvement industry -- evidenced by a strong performance in lawn and garden, the success of our retail promotional programs, and ongoing new store openings and store remodels," said president and CEO Lyle Heidemann. "Lower fuel costs, a favorable margin mix and across-the-board expense controls drove our enhanced profitability."

True Value's 2008 wholesale sales were $2.01 billion, down 1.5% from the previous year.

For the six months ending July 4, True Value reported revenue of $983.7 million, a decrease of 5.1% from the same period a year ago. Comp-store sales were down 2.4% in the six months. The 2009 year-to-date net margin was $39 million, up 64.6%.