HomeBase Executives Raise Personal Stakes in Company
HomeBase Inc. executives have put their money where their new retail concept is, as they seek to counter competition from rivals such as Home Depot Inc. by concentrating on home decor items.
Herbert Zarkin, chairman and chief executive of HomeBase, bought 1 million company shares in December after the Irvine retailer finished testing the new store concept.
At least six other officers and directors bought a total of 190,000 additional shares during the same month, according to documents filed with the Securities and Exchange Commission.
The company has been one of several regional home improvement retailers to get clobbered by price competition from national chains such as Home Depot and Lowe’s Cos. Inc.
In December, HomeBase opted for a new strategy, shifting from home construction material to decorating merchandise that the larger chains don’t treat as the core of their businesses. Its House2Home concept includes such items as lighting, carpet and flooring, wall and window coverings, nursery and garden, and even silk flowers.
HomeBase tested the concept at five stores last year. Gross profits--the amount of money that the company takes in after deducting the costs of goods sold--were up to 10% higher on decorating items than on home improvement products.
HomeBase plans to adopt the House2Home idea at 62 other stores, while closing 22 locations.
The company barred insiders from buying stock while the test was underway. After the results were announced, Zarkin bought 1 million shares at 81 cents to $1.50 each between Dec. 6 and Dec. 29, according to SEC filings.
Bill Langsdorf, HomeBase’s chief financial officer, purchased 25,000 shares last month, and directors John Barr, Harold Leppo, Lorne Waxlax and Edward Weisberger bought a total of 150,000 shares. Thomas Gallagher, executive vice president of store operations, purchased 15,000 shares, the regulatory filings said.
HomeBase shares rose 19 cents to $1.75 Thursday in Nasdaq trading. The stock has more than doubled after hitting its 52-week low of 75 cents on Dec. 27.
