by Comparable-store sales fell 1.1% driven by softness in DIY spending, which also was offset by storm-related sales activity
MOORESVILLE, N.C. — Home improvement retailer Lowe’s Cos. reported a 1.5% drop in overall sales and a 4.4% drop in net earnings for its third quarter ended Nov. 1.
The company had net sales of $20.2 billion, down from $20.5 billion the same period last year. Comparable-store sales fell 1.1% driven by continued softness in DIY bigger-ticket discretionary demand which it said was offset by storm-related sales and positive comparable sales in its Pro and online businesses.
Net earnings totaled $1.7 billion, or $2.99 per share, compared with $1.8 billion, or $3.06 per share, last year.
Its gross margin was $6.8 billion, or 33.7% of net sales, compared with $6.9 billion, also 33.7% of net sales, last year. Operating income totaled $2.5 billion, or 12.6% of net sales, compared with $2.7 billion, or 13.2% of net sales, last year.
The company said that it also had a $54 million pre-tax gain associated with the 2022 sale of its Canadian business, which positively impacted its third-quarter earnings per share by 10 cents. Without the gain, third-quarter adjusted earnings per share was $2.89, the company said.
“Our results this quarter were modestly better than expected, even excluding storm-related activity, driven by high-single-digit positive comps in Pro, strong online sales and smaller-ticket outdoor DIY projects,” said Marvin R. Ellison, Lowe’s chairman, president and chief executive officer. “I’d like to extend my heartfelt sympathy to those who suffered losses from Hurricanes Helene and Milton. I would also like to express my appreciation for our associates, suppliers and first responders for their commitment to the impacted communities.”
He added that at its Analyst and Investor Conference this month, he looks forward “to discussing our new growth and productivity initiatives, which underscore our confidence that we are well-positioned to capitalize on the expected recovery in home improvement.”
Lowe’s has more than 1,700 home improvement stores and employs about 300,000 associates. It sells furniture on its website that includes living room, dining and kitchen, bedroom, office furniture and mattresses as well as entryway furniture, wall art and shelving units. The items can be purchased online and either delivered to one’s home or picked up at the closest store.
For 2023, it ranked No. 30 on Home News Now’s 125 listing of furniture and bedding retailers, with estimated sales of $700 million.
The company said that based on anticipated storm-related demand in the fourth quarter it has updated its outlook for the full year 2024.
The details are as follows:
+ The company expects total sales of $83 billion to $85 billion, compared to $82.7 billion to $83.2 billion previously.
+ Comparable sales are expected to be down 3% to 3.5% as compared to the prior year. This compares to previous guidance of sales down 3.5% to 4%.
+ Adjusted operating income as a percentage of sales is projected at 12.3% to 12.4% compared with 12.4% to 12.5% previously.
+ It anticipates net interest expenses of $1.3 billion compared with $1.4 billion previously.
+ It also anticipates adjusted earnings per share of $11.80 to $11.90, compared with $11.70 to $11.90 previously.
+ It also anticipates having capital expenditures of $2 billion for the year.
