* Q3 EPS C$0.38 vs analyst forecast C$0.40
* Sales down 0.5 percent
* Same-store sales down 2.25 percent
* Says it may not meet 2010-2011 sales targets
(Adds conference call, details, stock)
TORONTO, Nov 10 (Reuters) - Rona Inc RON.TO, Canada’s No.1 hardware distributor and retailer, said on Wednesday its profit rose less than expected and that it may not meet its targets for a key sales measure, sending its shares lower.
Rona said said it could fall short of its 2010 and 2011 targets for sales in stores opened at least a year because of weak consumer confidence and a still-tepid economic recovery in Canada. It said it was on track with other growth objectives.
Rona, which operates a network of nearly 700 stores, acquired four distributors and manufacturers during the quarter and eyes further expansion. It plans to develop its dealer network, make more acquisitions, and open more corporate-owned and franchised stores.
The Boucherville, Quebec-based company’s market share grew to an estimated 19 percent during the quarter. Its target is 20 percent by the end of 2011.
“The recession has opened up opportunities to consolidate the market,” said Chief Executive Robert Dutton during a conference call with analysts.
He noted the fundamentals of its business remained strong.
“Eighty percent of the existing homes of Canada are more than 20 years. Like I said, the roof is going to leak soon.”
For the third quarter ended Sept. 26, net earnings rose to C$50.2 million ($50.2 million), or 38 Canadian cents a share. That compares with a profit of C$49.1 million, or 38 Canadian cents, for the same period last year.
Analysts on average had forecast profit of 40 Canadian cents a share, according to Thomson Reuters I/B/E/S.
Quarterly sales slipped 0.5 percent to C$1.3 billion, while same-store sales, or stores open for at least a year, fell 2.3 percent.
RBC analyst Irene Nattel cut her price target for Rona to C$16 from C$18.
Rona shares fell more than 3 percent on Wednesday before recovering, but was still down nearly 1 percent at C$13.31 on the Toronto Stock Exchange.
$1=$1 Canadian Reporting by Solarina Ho; Editing by Frank McGurty