MOORESVILLE, N.C., Nov. 18, 2015 /PRNewswire/ -- Lowe's Companies,
Inc. (NYSE: LOW) today reported net earnings of $736 million for the quarter ended October 30, 2015, a 25.8 percent increase over
the same period a year ago. Diluted earnings per share increased
35.6 percent to $0.80 from
$0.59 in the third quarter of 2014.
For the nine months ended October 30,
2015, net earnings increased 12.8 percent from the same
period a year ago to $2.5 billion,
and diluted earnings per share increased 20.5 percent to
$2.70.
Sales for the third quarter increased 5.0 percent to
$14.4 billion from $13.7 billion in the third quarter of 2014, and
comparable sales increased 4.6 percent. For the nine month period,
sales were $45.8 billion, a 4.9
percent increase over the same period a year ago, and comparable
sales increased 4.6 percent. Comparable sales for the U.S. home
improvement business increased 5.0 percent for the third quarter
and 4.9 percent for the nine month period.
"This is an exciting time for Lowe's as we continue to execute
our strategic priorities alongside a favorable macroeconomic
backdrop," commented Robert A.
Niblock, Lowe's chairman, president and CEO. "I am
pleased that we delivered another solid quarter. Comparable
sales growth was driven by gains in both transactions and average
ticket, while our focus on productivity and profitability also
allowed us to deliver strong earnings per share growth."
"I would like to thank our employees for their purposeful
commitment to serving customers, particularly those who worked
diligently to assist our neighbors that were impacted by the
historic flooding in South
Carolina," Niblock added.
Delivering on its commitment to return excess cash to
shareholders, the company repurchased $750
million of stock under its share repurchase program and paid
$260 million in dividends in the
third quarter. For the nine month period, the company repurchased
$3.3 billion of stock under its share
repurchase program and paid $700
million in dividends.
As of October 30, 2015, Lowe's
operated 1,849 home improvement and hardware stores in the United States, Canada and Mexico representing 201.6 million square feet
of retail selling space.
A conference call to discuss third quarter 2015 operating
results is scheduled for today (Wednesday,
November 18) at 9:00 am
ET. The conference call will be available by webcast
and can be accessed by visiting Lowe's website at
www.Lowes.com/investor and clicking on Lowe's Third Quarter
2015 Earnings Conference Call Webcast. Supplemental slides
will be available fifteen minutes prior to the start of the
conference call. A replay of the call will be archived on
Lowes.com/investor until February 23,
2016.
Lowe's Business Outlook
Fiscal Year 2015 (comparisons to fiscal year 2014; based
on U.S. GAAP unless otherwise noted)
- Total sales are expected to increase 4.5 to 5 percent.
- Comparable sales are expected to increase 4 to 4.5
percent.
- The company expects to add 15 to 20 home improvement and
hardware stores.
- Earnings before interest and taxes as a percentage of sales
(operating margin) are expected to increase 80 to 100 basis
points.
- The effective income tax rate is expected to be approximately
38.1%.
- Diluted earnings per share of approximately $3.29 are expected for the fiscal year ending
January 29, 2016.
Disclosure Regarding Forward-Looking Statements
This news release includes "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995
(the "Act"), which the words "believe," "expect," "anticipate,"
"project," "will," "should," "could," and similar expressions are
intended to imply. Statements of the company's expectations for
sales growth, comparable sales, earnings and performance,
shareholder value, capital expenditures, cash flows, the housing
market, the home improvement industry, demand for services, share
repurchases, the Company's strategic initiatives and any statement
of an assumption underlying any of the foregoing, constitute
"forward-looking statements" under the Act. Although we
believe that the expectations, opinions, projections, and comments
reflected in these forward-looking statements are reasonable, we
can give no assurance that such statements will prove to be
correct. A wide variety of potential risks, uncertainties, and
other factors could materially affect our ability to achieve the
results either expressed or implied by these forward-looking
statements including, but not limited to, changes in general
economic conditions, such as the rate of unemployment,
interest rate and currency fluctuations, fuel and other energy
costs, slower growth in personal income, changes in consumer
spending, changes in the rate of housing turnover, the availability
of consumer credit and of mortgage financing, inflation or
deflation of commodity prices, and other factors which can
negatively affect our customers, as well as our ability to: (i)
respond to adverse trends in the housing industry, such as a
demographic shift from single family to multi-family housing, a
reduced rate of growth in household formation, and slower
rates of growth in housing renovation and repair activity, as well
as uneven recovery in commercial building activity; (ii) secure,
develop, and otherwise implement new technologies and processes
necessary to realize the benefits of our strategic initiatives and
enhance our efficiency; (iii) attract, train, and retain
highly-qualified associates; (iv) manage our business effectively
as we adapt our traditional operating model to meet the changing
expectations of our customers; (v) maintain, improve, upgrade and
protect our critical information systems from data security
breaches and other cyber threats; (vi) respond to fluctuations in
the prices and availability of services, supplies, and products;
(vii) respond to the growth and impact of competition; (viii)
address changes in existing or new laws or regulations that affect
consumer credit, employment/labor, trade, product safety,
transportation/logistics, energy costs, health care, tax or
environmental issues; and (ix) respond appropriately to
unanticipated failures to maintain a high level of product and
service quality that could result in a negative impact on customer
confidence and adversely affect sales. In addition, we could
experience additional impairment losses if either the actual
results of our operating stores are not consistent with the
assumptions and judgments we have made in estimating future cash
flows and determining asset fair values, or we are required to
reduce the carrying amount of our investment in certain
unconsolidated entities that are accounted for under the equity
method. For more information about these and other risks and
uncertainties that we are exposed to, you should read the "Risk
Factors" and "Critical Accounting Policies and Estimates" included
in our Annual Report on Form 10-K to the United States Securities
and Exchange Commission (the "SEC") and the description of material
changes therein or updated version thereof, if any, included in our
Quarterly Reports on Form 10-Q.
The forward-looking statements contained in this news release
are based upon data available as of the date of this release or
other specified date and speak only as of such date. All
subsequent written and oral forward-looking statements attributable
to us or any person acting on our behalf about any of the matters
covered in this release are qualified by these cautionary
statements and the "Risk Factors" included in our Annual Report on
Form 10-K to the SEC and the description of material changes, if
any, therein included in our Quarterly Reports on Form 10-Q.
We expressly disclaim any obligation to update or revise any
forward-looking statement, whether as a result of new information,
change in circumstances, future events, or otherwise.
Lowe's Companies, Inc. (NYSE: LOW) is a FORTUNEĀ® 50 home
improvement company serving approximately 16 million customers a
week in the United States,
Canada and Mexico through its stores and online at
Lowes.com, Lowes.ca and Lowes.com.mx. With fiscal year 2014
sales of $56.2 billion, Lowe's has
more than 1,845 home improvement and hardware stores and 265,000
employees. Founded in 1946 and based in Mooresville, N.C., Lowe's supports the
communities it serves through programs that focus on K-12 public
education and community improvement projects. For more information,
visit Lowes.com.
Lowe's Companies,
Inc.
|
Consolidated
Statements of Current and Retained Earnings
(Unaudited)
|
In Millions, Except
Per Share and Percentage Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
|
|
October 30,
2015
|
|
|
October 31,
2014
|
|
|
October 30,
2015
|
|
|
October 31,
2014
|
Current
Earnings
|
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
Net
sales
|
|
|
$
|
14,360
|
100.00
|
|
$
|
13,681
|
100.00
|
|
$
|
45,838
|
100.00
|
|
$
|
43,682
|
100.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
|
|
9,370
|
65.25
|
|
|
8,963
|
65.51
|
|
|
29,856
|
65.13
|
|
|
28,471
|
65.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
|
|
4,990
|
34.75
|
|
|
4,718
|
34.49
|
|
|
15,982
|
34.87
|
|
|
15,211
|
34.82
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
|
|
3,287
|
22.89
|
|
|
3,255
|
23.80
|
|
|
10,334
|
22.55
|
|
|
10,115
|
23.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
375
|
2.61
|
|
|
375
|
2.74
|
|
|
1,115
|
2.43
|
|
|
1,123
|
2.57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest -
net
|
|
|
|
141
|
0.98
|
|
|
134
|
0.98
|
|
|
409
|
0.89
|
|
|
384
|
0.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
|
|
3,803
|
26.48
|
|
|
3,764
|
27.52
|
|
|
11,858
|
25.87
|
|
|
11,622
|
26.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
earnings
|
|
|
|
1,187
|
8.27
|
|
|
954
|
6.97
|
|
|
4,124
|
9.00
|
|
|
3,589
|
8.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
|
|
451
|
3.14
|
|
|
369
|
2.69
|
|
|
1,589
|
3.47
|
|
|
1,341
|
3.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
|
$
|
736
|
5.13
|
|
$
|
585
|
4.28
|
|
$
|
2,535
|
5.53
|
|
$
|
2,248
|
5.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - basic
|
|
|
|
918
|
|
|
|
978
|
|
|
|
933
|
|
|
|
996
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share (1)
|
|
|
$
|
0.80
|
|
|
$
|
0.59
|
|
|
$
|
2.70
|
|
|
$
|
2.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - diluted
|
|
|
|
921
|
|
|
|
980
|
|
|
|
935
|
|
|
|
998
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share (1)
|
|
|
$
|
0.80
|
|
|
$
|
0.59
|
|
|
$
|
2.70
|
|
|
$
|
2.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share
|
|
|
$
|
0.28
|
|
|
$
|
0.23
|
|
|
$
|
0.79
|
|
|
$
|
0.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retained
Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
|
|
$
|
8,533
|
|
|
$
|
10,749
|
|
|
$
|
9,591
|
|
|
$
|
11,355
|
|
Net
earnings
|
|
|
|
736
|
|
|
|
585
|
|
|
|
2,535
|
|
|
|
2,248
|
|
Cash
dividends
|
|
|
|
(257)
|
|
|
|
(225)
|
|
|
|
(736)
|
|
|
|
(636)
|
|
Share
repurchases
|
|
|
|
(714)
|
|
|
|
(838)
|
|
|
|
(3,092)
|
|
|
|
(2,696)
|
|
Balance at end of
period
|
|
|
$
|
8,298
|
|
|
$
|
10,271
|
|
|
$
|
8,298
|
|
|
$
|
10,271
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Under the
two-class method, earnings per share is calculated using net
earnings allocable to common shares, which is derived by reducing
net earnings by the earnings allocable to participating
securities. Net earnings allocable to common shares used in
the basic and diluted earnings per share calculation were $733
million for the three months ended October 30, 2015 and $582
million for the three months ended October 31, 2014. Net
earnings allocable to common shares used in the basic and diluted
earnings per share calculation were $2,523 million for the nine
months ended October 30, 2015 and $2,235 million for the nine
months ended October 31, 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated
Statements of Comprehensive Income (Unaudited)
|
In Millions, Except
Percentage Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
|
|
October 30,
2015
|
|
|
October 31,
2014
|
|
|
October 30,
2015
|
|
|
October 31,
2014
|
|
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
Net
earnings
|
|
|
$
|
736
|
5.13
|
|
$
|
585
|
4.28
|
|
$
|
2,535
|
5.53
|
|
$
|
2,248
|
5.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments - net of tax
|
|
|
|
(69)
|
(0.48)
|
|
|
(23)
|
(0.17)
|
|
|
(275)
|
(0.60)
|
|
|
(11)
|
(0.03)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive loss
|
|
|
|
(69)
|
(0.48)
|
|
|
(23)
|
(0.17)
|
|
|
(275)
|
(0.60)
|
|
|
(11)
|
(0.03)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
|
|
$
|
667
|
4.65
|
|
$
|
562
|
4.11
|
|
$
|
2,260
|
4.93
|
|
$
|
2,237
|
5.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated
Balance Sheets
|
In Millions, Except
Par Value Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
October 30,
2015
|
|
|
October 31,
2014
|
|
|
January 30,
2015
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,227
|
|
$
|
1,562
|
|
$
|
466
|
Short-term
investments
|
|
|
158
|
|
|
211
|
|
|
125
|
Merchandise inventory -
net
|
|
|
10,434
|
|
|
9,762
|
|
|
8,911
|
Deferred income taxes -
net
|
|
|
255
|
|
|
261
|
|
|
230
|
Other current
assets
|
|
|
321
|
|
|
334
|
|
|
348
|
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
|
12,395
|
|
|
12,130
|
|
|
10,080
|
|
|
|
|
|
|
|
|
|
|
Property, less accumulated
depreciation
|
|
|
19,655
|
|
|
20,180
|
|
|
20,034
|
Long-term
investments
|
|
|
382
|
|
|
395
|
|
|
354
|
Other assets
|
|
|
1,223
|
|
|
1,327
|
|
|
1,359
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
33,655
|
|
$
|
34,032
|
|
$
|
31,827
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
Current maturities of
long-term debt
|
|
$
|
1,058
|
|
$
|
551
|
|
$
|
552
|
Accounts payable
|
|
|
7,338
|
|
|
6,459
|
|
|
5,124
|
Accrued compensation and
employee benefits
|
|
685
|
|
|
676
|
|
|
773
|
Deferred revenue
|
|
|
1,084
|
|
|
1,029
|
|
|
979
|
Other current
liabilities
|
|
|
1,997
|
|
|
2,089
|
|
|
1,920
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
12,162
|
|
|
10,804
|
|
|
9,348
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, excluding
current maturities
|
|
11,541
|
|
|
10,806
|
|
|
10,815
|
Deferred income taxes -
net
|
|
|
-
|
|
|
92
|
|
|
97
|
Deferred revenue - extended
protection plans
|
|
731
|
|
|
736
|
|
|
730
|
Other
liabilities
|
|
|
843
|
|
|
864
|
|
|
869
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
25,277
|
|
|
23,302
|
|
|
21,859
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
|
Preferred stock - $5 par
value, none issued
|
|
|
-
|
|
|
-
|
|
|
-
|
Common stock - $.50 par
value;
|
|
|
|
|
|
|
|
|
|
Shares issued and
outstanding
|
|
|
|
|
|
|
|
|
|
October 30,
2015
|
917
|
|
|
|
|
|
|
|
|
October 31,
2014
|
974
|
|
|
|
|
|
|
|
|
January 30,
2015
|
960
|
|
459
|
|
|
487
|
|
|
480
|
Capital in excess of par
value
|
|
|
-
|
|
|
-
|
|
|
-
|
Retained earnings
|
|
|
8,298
|
|
|
10,271
|
|
|
9,591
|
Accumulated other
comprehensive loss
|
|
|
(379)
|
|
|
(28)
|
|
|
(103)
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
8,378
|
|
|
10,730
|
|
|
9,968
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
33,655
|
|
$
|
34,032
|
|
$
|
31,827
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
|
|
|
|
Consolidated
Statements of Cash Flows (Unaudited)
|
|
|
|
|
In
Millions
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
|
October 30,
2015
|
|
October 31,
2014
|
Cash flows from
operating activities:
|
|
|
|
|
Net
earnings
|
|
$
2,535
|
|
$
2,248
|
Adjustments to
reconcile net earnings to net cash provided by
|
|
|
|
|
operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
1,192
|
|
1,199
|
Deferred income
taxes
|
|
(140)
|
|
(201)
|
Loss on property and
other assets - net
|
|
19
|
|
24
|
Loss on equity method
investments
|
|
46
|
|
47
|
Share-based payment
expense
|
|
84
|
|
84
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Merchandise inventory
- net
|
|
(1,536)
|
|
(641)
|
Other operating
assets
|
|
38
|
|
105
|
Accounts
payable
|
|
2,218
|
|
1,452
|
Other operating
liabilities
|
|
90
|
|
367
|
Net cash provided
by operating activities
|
|
4,546
|
|
4,684
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Purchases of
investments
|
|
(650)
|
|
(600)
|
Proceeds from
sale/maturity of investments
|
|
588
|
|
458
|
Capital
expenditures
|
|
(844)
|
|
(587)
|
Contributions to
equity method investments - net
|
|
(106)
|
|
(196)
|
Proceeds from sale of
property and other long-term assets
|
|
51
|
|
44
|
Other -
net
|
|
(25)
|
|
(6)
|
Net cash used in
investing activities
|
|
(986)
|
|
(887)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Net decrease in
short-term borrowings
|
|
-
|
|
(386)
|
Net proceeds from
issuance of long-term debt
|
|
1,718
|
|
1,239
|
Repayment of
long-term debt
|
|
(541)
|
|
(36)
|
Proceeds from
issuance of common stock under
share-based payment plans
|
|
69
|
|
90
|
Cash dividend
payments
|
|
(700)
|
|
(597)
|
Repurchase of common
stock
|
|
(3,382)
|
|
(2,950)
|
Other -
net
|
|
46
|
|
16
|
Net cash used in
financing activities
|
|
(2,790)
|
|
(2,624)
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(9)
|
|
(2)
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
761
|
|
1,171
|
Cash and cash
equivalents, beginning of period
|
|
466
|
|
391
|
Cash and cash
equivalents, end of period
|
|
$
1,227
|
|
$
1,562
|
|
|
|
|
|
Logo -
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visit:http://www.prnewswire.com/news-releases/lowes-reports-third-quarter-sales-and-earnings-results-300180586.html
SOURCE Lowe's Companies, Inc.