Mooresville, N.C. -
Lowe's reported flat net earnings of $830 million for its fiscal second quarter,
ended July 29.
Sales edged up 1.3
percent to $14.5 billion, well below the company's 4 percent forecast, and
same-store sales slipped 0.3 percent, reflecting continued macroeconomic weakness.
Major appliances was Lowe's poorest-performing category, with comp sales down by the mid-single digits, noted Credit Suisse retail analyst Gary Balter. But total comps improved throughout the quarter, the company said, rising 2.2 percent in July as the chain edges toward an everyday-low-price (EDLP) pricing strategy.
"Despite some recovery in our seasonal
business, our performance for the quarter fell short of our expectations," acknowledged
Lowe's chairman/president/CEO Robert Niblock. "We are working diligently to
improve sales and profitability in the near-term in a way that we believe will
generate sustained customer preference and shareholder value. We are also
building momentum in 2011 behind our longer-term commitment to deliver even
better customer experiences."
results included a charge for evaluating the carrying value of long-lived
assets, including seven stores that closed on Aug. 14, which reduced pretax
earnings for the quarter by $83 million.
During the quarter
Lowe's opened two stores, bringing the store count to 1,753 locations in the
U.S., Canada and Mexico as of July 29, for a total of 197.6 million square feet
of retail selling space, up 1.5 percent over last year.
Looking ahead, the
No. 2 home-improvement chain and major appliance retailer is projecting flat
same-store sales and a 2 percent increase in net sales for its fiscal third
quarter ending Oct. 28.
Archrival The Home
Depot reports its second-quarter results tomorrow.