ADENTRA Stock

ADENTRA Inc. distributes architectural building products to the North American residential and commercial construction markets.

The company operates a network of 86 distribution centres in Canada and the U.S. The company engages in the wholesale distribution of architectural building products to customers that supply products to the residential, repair and remodel, and commercial construction markets. The company is largest supplier of architectural building products to the residential, repair and remodel and commercial construction markets. As at March 11, 2022, the company operated 86 facilities across North America. Certain of these facilities include light manufacturing capabilities, which enable the company to create custom moulding and millwork packages for its customers.

The company’s product mix includes a wide array of products, including doors, decorative surfaces, moldings, stair parts, hardwood lumber, hardwood plywood, composite panels, and other building products. Many of the company’s product lines are complementary, and it typically sells its customers some combination of key products.

The company’s primary role in the industry is to provide the critical link between suppliers that generally manufacture and want to sell large volumes of certain products, and customers that generally require lesser quantities of many different products on a just-in-time basis. In addition to fulfilling this essential role in the supply chain, the company provides value-added services when some level of customization is required by its customers.

On July 30, 2021, the company, through one of its wholly owned subsidiaries, acquired all of the equity interests of Novo Building Products Holdings LLC (Novo), including final working capital adjustments. Novo is a value-added distributor and manufacturer of specialty building products, supplying stair parts, doors, and other specialty millwork products to home centers and home builder distribution yards. Novo operates a network of 14 facilities primarily in the Eastern and Midwestern U.S., Florida and Texas. Novo's divisions include Empire Moulding & Millwork, Southwest Moulding & Millwork, Ornamental Decorative Millwork, LJ Smith Stair Systems and Novo Direct.

The company’s customers include industrial manufacturers, big box retail stores, and pro dealers. Customers rely on the company for tailored and unique material supply solutions, best-in-class service, and a wide array of products.

On February 7, 2022, the company completed the acquisition of Mid-Am Building Products (Mid-am), a leading distributor of architectural grade building products in the U.S. Midwest to Pro Dealers.

Strategically, the Mid-Am acquisition represents a natural geographic extension from the company’s footprint, providing access to customers and markets in the U.S. Midwest. Mid-Am's product mix includes doors, millwork and other diversified building materials, which are complimentary to its own.

The company’s customers include industrial manufacturers, home builder distribution yards (Pro Dealers), and home centers.

Industrial manufacturers are consisted of thousands of small to mid-sized customers that require materials on a just-in-time basis, typically need a wider range of products than they can source from any one mill, and seek time to pay in the form of credit terms. These customers manufacture a range of end-use products, including cabinetry, furniture and custom millwork.

Pro Dealers are consisted of smaller and larger customers that manufacture and supply building materials to both custom and production home builders. Pro Dealers require the company to manage the complex supply chain and lead times associated with the architectural building products that the company sells. Increasingly Pro Dealers also want to align with suppliers like the company that have a national footprint and that can work with them on an organized and consistent basis across multiple regions.

Home centers are consisted of building materials retailers, such as Lowe's, Marvin's, and McCoy's. The majority of the company’s home center customers turn over the aisle to HDI and require the company to be a full category manager. This includes managing the complex supply chain and lead times associated with the architectural building products that the company sells, determining what product to stock in which locations, shipping the product to each individual store and physically replenishing the aisle, counting and culling inventory as needed, training home center staff on the product, and supporting e-commerce activities.

As it relates to its suppliers, the company adds value by buying their product in volume and paying them promptly, by providing access to its large North American distribution network, and by supporting their products with strong sales and marketing support. The company effectively acts as their third-party sales force.

Customers sell the company’s products into multiple sectors of the economy, including new home construction, renovation, non-residential construction, institutional markets and manufacturing. As a result of this diversity, it is difficult to determine with certainty what proportion of the company’s products end up in each sector of the economy. The company estimates that approximately 40% of its products end up in new residential construction and another 40% in the repair and remodel end-markets. The company estimates that the remaining 20% ends up in in other sectors of the economy not associated with new residential construction, such as finishing millwork for office buildings, recreational vehicles, restaurant and bar interiors, hotel lobbies, retail point-of-purchase displays, schools, hospitals, custom motor coaches, yacht interiors and other specialty areas.

History

The company was incorporated in 2012. The company was formerly known as Hardwoods Distribution Inc. and changed its name to ADENTRA Inc. in December 2022.