Lowe's Fiscal Q1 Sales Increase 11.4%, Net Earnings Gain 21.7%

Wilkesboro, N.C.— A strong housing market and improving consumer confidence outweighed adverse weather conditions and the uncertainties of world events to help push fiscal first quarter sales up 11.4 percent at Lowe's Cos. Sales hit $7.2 billion, compared with $6.5 billion in the same three months last year.

However, the home improvement retailer, which opened 21 new stores during its fiscal first quarter, reported a comp-store sales increase of only 0.1 percent during the period.

Net earning for the fiscal first quarter, ended May 2, jumped 21.7 percent, reaching $421 million, compared with $346 million in the year-ago period.

Gross margin in the first three months climbed 130 basis points, to 31 percent, up from 29.7 percent in the same quarter in 2002. Selling, general and administrative expenses, however, didn't make the same positive contribution, rising 60 basis points, to 18.2 percent, compared with 17.6 percent year-on-year.

Looking ahead, the retailer expects to increase sales about 13 percent in the second quarter, with comps hitting a 2 percent to 4 percent increase in the period. The company anticipates opening 25 additional stores in the three months.

For the fiscal year, Lowe's expects to open 130 locations, with total sales increasing about 14 percent to 15 percent during the 12 months. Comp-store sales are anticipated at about a 3 percent to 4 percent increase. Store opening costs are expected to be about $140 million for the 12 months.