Mooresville, NC, May 17--Lowe's Companies, Inc., today reported net earnings of $455 million for the quarter ended April 30, 2004, an 8.1% increase over the same period a year ago. Diluted earnings per share increased 7.5% to $0.57 from $0.53 in the first quarter of 2003.
Analysts on average were expecting profit of 54 cents a share.
Excluding the $126 million net earnings and $0.16 per share impact of EITF 02-16, net earnings would have been $581 million, a 38.0% increase over last year's first quarter and diluted earnings per share would have increased 37.7% to $0.73.
Sales for the quarter increased 22.0% to $8.68 billion, up from $7.12 billion in the first quarter of 2003. Comparable store sales for the first quarter increased 9.9%.
"The right store format, the right products and consistently excellent service have proven quarter after quarter that Lowe's has the right business model to meet our customers' needs," explained Robert L. Tillman, Lowe's chairman and CEO.
"Consumer focus on the home remains constant, and Lowe's remains uniquely positioned to satisfy that need and capitalize on the growth of the home improvement market."
"Strength in every product category and across every geographic region drove solid earnings growth in the first quarter," said Lowe's President, Robert A. Niblock. "Continued strong sales in big-ticket categories such as outdoor power equipment and kitchen cabinets are an indication that consumers are not only willing, but are enthusiastic about investing in products and projects that maintain and enhance their greatest asset--their home."
During the quarter, Lowe's opened 29 new stores, and closed one store. As of April 30, 2004, Lowe's operated 980 stores in 45 states representing 111.9 million square feet of retail selling space, a 15.1% increase over last year.
Second Quarter 2004 (comparisons to second quarter 2003)
*The company expects to open 19 stores reflecting square footage growth of approximately 14%.
*Total sales are expected to increase approximately 19%.
*The company expects to report a comparable store sales increase of 6% to 7%.
*Operating margin (defined as gross margin less SG&A and depreciation) is expected to increase 15 to 25 basis points.
*Store opening costs are expected to be approximately $20 million.
*Diluted earnings per share of $0.89 to $0.91 are expected.
*Lowe's second quarter ends on July 30, with operating results to be publicly released on Monday, August 16.
Fiscal Year 2004 (comparisons to fiscal year 2003)
*The company expects to open 140 stores in 2004 reflecting total square footage growth of approximately 14%.
*Total sales are expected to increase approximately 18% for the year.
*The company expects to report a comparable store sales increase of 6% to 7%.
*Including the estimated 60 basis point negative impact of EITF 02-16, operating margin (defined as gross margin less SG&A and depreciation) is expected to decline 10 to 20 basis points.
*Store opening costs are expected to be approximately $124 million.
*Including the estimated $0.16 impact of EITF 02-16, diluted earnings per share of $2.69 to $2.72 are expected for the fiscal year ending January 28, 2005. Excluding the impact of the accounting change, diluted earnings per share of $2.85 to $2.88 would be expected. Presentation of this measure is intended to allow investors to compare our fiscal 2004 performance with that in fiscal 2003.
