MOORESVILLE, N.C. -Lowe’s Companies, Inc. (NYSE: LOW), the world’s second largest home improvement retailer, today reported net earnings of $527 million for the quarter ended May 4, 2012, a 14.3 percent increase over the same period a year ago. Diluted earnings per share increased 26.5 percent to $0.43 from $0.34 in the first quarter of 2011.
“We are building on our core strengths and strategically investing in ways that will better position Lowe’s for success. I would like to express my gratitude to our employees for their continued dedication and customer focus.”
Sales for the quarter increased 7.9 percent to $13.2 billion from $12.2 billion in the first quarter of 2011.
Lowe’s fiscal year ends on the Friday nearest the end of January; therefore, fiscal year 2011 included 53 weeks. The 2012 quarterly comparisons will be impacted by a shift in comparable weeks. The week shift aided the first quarter sales increase by $514 million or 4.2 percent, and contributed approximately $0.05 to the diluted earnings per share growth.
Included in the above reported results is a charge related to a previously announced reduction in staff at U.S. headquarters. This charge reduced pre-tax earnings for the first quarter by $17 million and diluted earnings per share by $0.01.
Comparable store sales for the quarter increased 2.6 percent, while comparable store sales for the U.S. business increased 2.7 percent.
“We delivered solid results for the quarter, consistent with our expectation at the beginning of the year,” commented Robert A. Niblock, Lowe’s chairman, president and CEO. “While we capitalized on better than anticipated weather during most of the quarter, demand for seasonal products slowed toward the end.
“We continue to maintain a cautious view of the housing and macro demand environment, and are focused on what we can control,” Niblock added. “We are building on our core strengths and strategically investing in ways that will better position Lowe’s for success. I would like to express my gratitude to our employees for their continued dedication and customer focus.”
As of May 4, 2012, Lowe’s operated 1,747 stores in the United States, Canada and Mexico representing 196.7 million square feet of retail selling space.
Lowe’s Business Outlook
Fiscal Year 2012 – a 52-week Year (comparisons to fiscal year 2011 – a 53-week year)
Total sales are expected to increase 1 to 2 percent. On a 52 versus 52 week basis, total sales are expected to increase approximately 3 percent.
The company expects comparable store sales to increase 1 to 3 percent (52 versus 52 week basis).
The company expects to open approximately 10 stores in fiscal year 2012.
Earnings before interest and taxes as a percentage of sales (operating margin) are expected to increase approximately 90 basis points.
Depreciation expense is expected to be approximately $1.5 billion.
The effective income tax rate is expected to be approximately 37.9%.
Diluted earnings per share of $1.73 to $1.83 are expected for the fiscal year ending February 1, 2013.
|Three Months Ended|
|May 4, 2012||April 29, 2011|
|Cost of sales||8,589||65.30||7,866||64.56|
|Selling, general and administrative||3,241||24.65||3,120||25.60|
|Interest - net||103||0.78||88||0.72|
|Income tax provision||323||2.45||279||2.28|
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