Mooresville, NC, November 14, 2005--Lowe's in the third quarter reported net earnings of $649 million, a 25.8 percent increase over the same period a year ago. Diluted earnings per share increased 24.6 percent to $0.81.
The company beat analysts estimates, there were looking for per share earnings of $0.77 in the quarter.
Sales for the quarter increased 16.9 percent to $10.6 billion. Comparable store sales for the third quarter increased 6.2 percent
For the nine months ended October 28, 2005, net earnings grew 24.5 percent to $2.08 billion while diluted earnings per share increased 24.5 percent to $2.59. Sales for the first nine months increased 16.2 percent to $32.4 billion. Comparable store sales increased 5.5 percent in the first nine months of 2005.
"Our performance, highlighted by positive comparable store sales in all of our 20 product categories and 19 of our 21 geographic regions, is a clear indication that consumers continue to invest in products and projects to maintain, enhance and improve their homes even in light of concerns about the impact of rising gasoline and home heating costs," explained Robert A. Niblock, Lowe's chairman, president and CEO. "Continued investments in our business coupled with our culture of customer service have strengthened our competitive position, and we're confident Lowe's has the flexibility to adapt to changes in the marketplace to continue to deliver solid results."
"Our employees provided exceptional service in a quarter marked by the distractions of three major hurricanes," Niblock added. "Our focus on serving our customers' needs with innovative and differentiated products and services allows us to continue to capture market share in a fragmented home improvement industry."
During the quarter, Lowe's opened 33 new stores and temporarily closed one store impacted by hurricane Katrina. As of October 28, 2005, Lowe's operated 1,170 stores in 49 states representing 133.0 million square feet of retail selling space, a 13.1 percent increase over last year.
The company's outlook for the quarter included:
-The company expects to open 63 new stores and reopen one store that was temporarily closed following hurricane Katrina reflecting square footage growth of approximately 13 percent.
-Total sales are expected to increase approximately 22 percent
-The company expects to report a comparable store sales increase of 4 to 6 percent (14 weeks vs. a comparable 14 weeks)
-Operating margin (defined as gross margin less SG&A and depreciation) is expected to decline approximately 20 basis points
-Store opening costs are expected to be approximately $50 million
-Diluted earnings per share of $0.77 to $0.80 are expected
-Lowe's fourth quarter ends on February 3, 2006 with operating results to be publicly released on Monday, February 27, 2006
Lowe's' outlook for the fiscal 2005 quarter included: (comparisons to fiscal year 2004 - a 52- week year). The company expects to open 150 stores in 2005 reflecting total square footage growth of approximately 13 percent.
Total sales are expected to increase 17 to 18 percent for the year. The company expects to report a comparable store sales increase of 5 to 6 percent.
Operating margin (defined as gross margin less SG&A and depreciation) is expected to increase approximately 40 basis points. Store opening costs are expected to be approximately $134 million. Diluted earnings per share of $3.37 to $3.40 are expected for the fiscal year ending February 3, 2006.
