Lowe's Sales Climb 22% In Fiscal Q1

By Jeff Malester -- TWICE, 6/7/2004

Mooresville, N.C. — Propelled by "strength in every product category and across every geographic region," home improvement retailer Lowe's Cos. reported a 22 percent increase in sales for its fiscal first quarter, hitting $8.7 billion, up from $7.1 billion in the year-ago period. Comp-store sales jumped 9.9 percent.

Net earnings for the first quarter, ended April 30, increased to $455 million, an 8.1 percent rise over the $421 million recorded in the same three months in 2003. Excluding the $126 million net earnings impact due to accounting changes, net earnings in the first quarter would have been $581 million.

Lowe's underscored its continued strong sales in big-ticket categories in the first quarter as an indication that customers "are not only willing, but are enthusiastic about investing in products and projects that maintain and enhance their greatest asset — their home."

Gross margin for the first three months increased to 33.1 percent, compared with a year-over-year 31.2 percent. Expenses for the period, however, climbed to 21.4 percent, up from 18.3 percent.

During the year's initial quarter, Lowe's opened 29 new stores and closed one location. At the end of April, the chain operated 980 stores.

Looking ahead to the second quarter, the retailer anticipates a 19 percent increase in sales, compared with the same three months last year, with comps driving upward between 6 percent and 7 percent.

For the fiscal year, Lowe's expects to increase sales by about 18 percent year-on-year, with comps also rising by between 6 percent and 7 percent.