Norandex, one of the nation's largest distributors of exterior building products, confirmed today it will close 36 branches--one quarter of its total--as part of a restructuring.
Some of the closures involves consolidation with nearby branches while others represent a departure from the market, Mike Horgan, a spokesman for Hudson, Ohio-based Norandex, told ProSales. Once the closures are completed next month, Norandex will have 105 branches, he said.
According to Horgan, the closures are an offshoot of Norandex becoming part of Saint-Gobain, the French construction giant whose North American holdings also include CertainTeed. "Our goal is to become a full-line, broad-based distributor" as opposed to being known primarily for distributing siding and windows, he said. Horgan noted the company has added roofing and decking to its product mix and it is looking at distributing other products as well. The company also has increased its supply-chain capabilities, he said.
Horgan stressed that the closures are not a cost-cutting move.
Saint-Gobain doesn't release results for its individual companies. Last month, it reported that its sales in North America grew 10.3% in the third quarter from the year-earlier period to reach 1.44 billion Euros ($2.02 billion). But exchange-rate differences and some structural changes accounted for most of those gains. On a comparable structure basis, sales climbed 9.5%, it said, and when currency changes are figured in as well, sales actually declined 1.5% from a year earlier.
"[B]usinesses related to North American construction markets were hit by the repercussions of over-optimistic expectations from distributors, whose restocking had inflated first-half figures," the company said. Sales of roofing products in the United States dropped sharply, it said, without revealing any particular numbers.
