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K. SCHIPPER: Hi, I’m K. Schipper with the latest in hard surfaces industry news from Radio Stone Update.
00:34
Despite supply-chain problems and inflation-rate hikes, an industry survey of kitchen and bath professionals showed first quarter double-digit business growth. The survey from the National Kitchen & Bath Association – the NKBA – was generally optimistic.
Not only did the Kitchen and Bath Market Index – the KBMI – find that growth in the first quarter of 2022 was up 12.6% from the fourth quarter of 2021, but respondents were optimistic, noting one of the highest ratings of future conditions in the past three years.
In the KBMI first quarter report, all kitchen and bath industry segments also reported high single-digit sales growth year-over-year, except for manufacturers reporting double-digit sales growth of 10.3%.
The numbers have increased 2022 full-year growth expectations, as well. Professionals now anticipate a 15.1% growth rate for the year, up from 9.4% at the start of the year. The industry rated future business conditions at 78.6 on a 100-point scale. That’s the second-highest rating in more than three years, topped only by the 82.4 rating at the end of the first quarter in 2021.
Among the report’s key findings were, cabinets and appliances remained as the scarcest items in the supply chain, forcing product substitution. Countertop materials ranked fifth on the tough-to-substitute list for retailers and designers but didn’t appear in the top five of industry members overall.
Quartz surfaces scored high in the kitchen. The manufactured surface showed a 62% increase in attractiveness among industry members, with only a 5% decrease. Marble’s popularity changed in the quarter with a 14% increase/44% decrease, while granite followed closely at a 14% increase/50% decrease.
Forty-three% of building and construction firms reported most projects were behind schedule in the first quarter of this year. Due to long timelines, 46% of building and construction firms had clients cancel or postpone projects in the first quarter.
And industry professionals reported labor availability having a significant impact, and rating the overall effect at a 6.7 on a 10-point scale. They also raised rates by an average of 18% to retain or attract talent. Three-quarters of the designer segment also increased labor rates to retain existing employees.
03:18
A major European equity capital firm acquired majority ownership in TENAX, a leading manufacturer of treatments, abrasives and tooling for natural stone and manmade hard surfaces. A deal between TENAX and London-based Sun European Partners LLC was announced last week. Terms of the private transaction weren’t disclosed.
Headquartered near Verona, Italy, TENAX has subsidiaries in the United States, Spain, Brazil, Turkey, India, and China. Sun European Managing Director Mark Corbridge says the equity capital firm will support the founding Bombana family and management to further accelerate growth through its operational expertise and a buy-and-build strategy.
TENAX President Gino Bombana called the move, “a great opportunity to strengthen our strategic plan and offer ever more innovative solutions, capable of satisfying the constantly evolving needs of our customers through important investments in our operations and in research and development.” He added it will be a shared journey as the Bombana family retains a significant stake in the business and remains involved in the management.
Filippo Emanuel, CEO of TENAX USA, says that the Charlotte, N.C.-based operation has never been stronger. He believes that, with the support and expertise of Sun Partners, TENAX USA will continue to support the company’s distribution and listen even more to fabricators’ needs to help improve a growing industry.
Sun’s U.S. affiliate, Sun Capital Partners, also retains a significant holding in the hard surface industry. The firm acquired Austin, Texas-based Architectural Surfaces Group – formerly Select Interior Concepts – last October in a deal valued at approximately $375 million.
06:27
Mosaic Companies is in the process of building a new state-of-the-art warehouse and distribution hub in the Miami area for its natural stone, slab, and tile products. The new facility is expected to open this fall.
The center, being erected in the Countyline Corporate Park in Hialeah, Fla., will nearly double Mosaic Companies’ East Coast warehouse footprint and support all the company’s brands, including Walker Zanger, Opustone, Surfaces and Anthology Tile. The location will also host a new Anthology Tile showroom as well as the company’s corporate office personnel.
Mosaic Companies President Keith Denny says executives knew that to grow the business and better support its clients, dealers and distributors they couldn’t rely on a series of small brand-centric warehouses in multiple locations. Says Denny, “We had to go big and modernize our onsite logistics infrastructure.”
Mosaic Companies LLC is a holding company formed in 2019 as a partnership between Surfaces founder Albert Claramonte and the Baupost Group, a leading Boston-based investment firm, with the goal of building a leading omni-channel platform in specialty wall, mosaic and slab products.
07:46
The U.S. Army Corps of Engineers ordered operators of a Colorado mine to construct a culvert and bridge and rehabilitate the stream they illegally diverted in 2018. Colorado Stone Quarries, which operates the Pride of America Mine outside of Marble, Colo., diverted about 1,700 feet of Yule Creek without first obtaining a permit from the Corps in violation of the federal Clean Water Act.
According to the “Aspen Times” newspaper, the centerpiece of the project is a 72-inch diameter culvert and bridge that will allow sediment to flow more easily under the county road that serves the quarry. Ben Wilson, project manager for the Corps, says by building what will become a flow-through system, it will help restore a portion of the stream and return drainage back to its original flow path.
Among other requirements, CSQ will have to enhance the new stream channel by adding woody debris, creating pools and riffles and planting willows, and then will have to monitor the channel for five years. The mining company also has to comply with state water quality standards and post additional financial assurance to the tune of $235,430, among other actions.
Work is scheduled to begin on the mitigation later this summer and be completed by 2024. The Pride of America Mine, better known at the Yule Quarry, has supplied marble for such well-known structures as the Lincoln Memorial, the Tomb of the Unknown Soldier, and the Colorado Capitol..
09:20
Cosentino reopened its Manhattan City Center after a major renovation for what it calls a next-gen showroom experience. The 4,000 ft2 facility, which initially opened in 2015 as the company’s first North America “City Center” has been completely reimagined to transform how Cosentino inspires and serves New York’s global design community and homeowners alike.
The CEO of Cosentino North America and executive vice president of Global Sales, Eduardo Cosentino, called the initial showroom a pivotal milestone for the company. He adds, “While this revamped space starts an even more exciting chapter, it reflects what will always be inherent to Cosentino’s DNA: Our tireless commitment to evolve and innovate so that we may better serve our customers.”
The revamped City Center, located in Midtown Manhattan’s A&D Building, involves a more-holistic and highly immersive “Phygital” approach to inspire and guide the design process. The showroom’s anchor, the Atelier, is a design workshop that gives guests access to Cosentino’s full product offering and an expansive selection of globally and local sourced textiles, tile, cabinetry samples and design fixtures.
On the heels of successful 2021 launches in Chicago and Atlanta, Cosentino plans to expand the new City Center concept to the Washington metro area this fall, and globally with new locations in Tokyo, Singapore, Stockholm, Paris and Mallorca, Spain.
10:58
The Association for Corporate Growth has recognized MS International – MSI – as the top company for sustainable growth during its 27th annual awards event. The awards honor the highest performing and extraordinary top middle-market companies in Orange County and the Inland Empire.
More than 100 nominees were submitted, all of whom have significantly contributed to the economic growth of Orange County and the Inland Empire by creating jobs and pioneering products and services that have helped the region become a national powerhouse of growth and innovation.
MSI is a leading supplier of flooring, countertop, wall tile, and hardscaping products in North America. The company has grown organically every year since its inception and in 2021 reported revenues in excess of $2 billion.
In other news from around the industry:
11:58
“Waves of Innovation” is the theme for the International Surface Fabricator Association’s 2022 Annual Conference. Scheduled for October 17-19 in Clearwater, Fla., the event includes educational sessions and business development workshops, new product presentations and networking opportunities.
The program will focus on a growth mindset in business by integrating software and technology to improve production output and understanding key metrics in marketing and consumer outreach. Registration is now open at www.ISFAnow.org/annual-conference.
12:42
The 13th annual Total Solutions Plus – or TSP – will bring the tile industry together Nov. 6-8 at the Hyatt Regency resort in Indian Wells, Calif. Attendees will have the opportunity to participate in pre-conference committee meetings, two keynote speakers and several educational, business and technical breakouts, as well as a Nov.7 Tabletop Exhibit show. Among the technical breakout sessions will be a presentation entitled “Large, Thin Porcelain Tile Panels: Design Revolution with Advanced Materials, New Standards and Qualified Labor.” For information or to register, go to www.ctdahome.org/tsp
13:32
And, Arizona Tile is celebrating the opening of a new location in Beaverton, Ore. Serving the greater Portland area, the facility is approximately 48,000 ft2, and includes an interactive showroom, slab viewing gallery and order desk. Customers can find inspiration perusing the wide variety of installation examples throughout the showroom floor. The new location is managed by Neil Czelder, who previously worked for Arizona Tile as an outside sales representative.
Remember, the latest issue of Stone Update is now available at www.magazine.stonemag.com. Our online newsletter, Slab and Sheet, appears on alternate Wednesdays. For notes and a transcript of this podcast go to www.radiostoneupdate.com.
For Radio Stone Update, I’m K. Schipper and we’ll see you here again soon.
