Lowe’s has 54 percent increase in first quarter earnings
By Paul Nowell AP Business Writer
CHARLOTTE, N.C. (AP) – Lowe’s Companies Inc.’s first-quarter profits climbed 54 percent from a year ago, easily surpassing Wall Street expectations.
The world’s second-largest home improvement retailer behind Home Depot Inc. also raised its earnings expectations for the second quarter and the rest of the year.
Lowe’s posted a profit of $345.8 million, or 44 cents a share, for the first quarter, up from $225.3 million, or 29 cents a share, a year earlier.
Analysts surveyed by Thomson Financial/First Call were looking for earnings of 36 cents a share.
Sales increased 23 percent to $6.47 billion from $5.28 billion a year ago.
Peter S. Benedict, an analyst CIBC World Markets Corp. in New York, said the North Carolina-based chain’s quarterly results were “fantastic.”
“They were pretty much strong across the board,” he said. “Sales were ahead of expectations, and their gross margins were the big story.”
Benedict said Lowe’s benefitted from a strong U.S. housing market and the “nesting” trend in this country since the Sept. 11 terrorist attacks.
Robert L. Tillman, Lowe’s chairman and CEO, echoed that assessment: “Our customers continued to demonstrate an eagerness to maintain, decorate and improve their homes even against a backdrop of mixed economic data.”
Lowe’s opened 46 stores during the quarter to give the chain 785 stores as of May 3. The company plans to open about 23 more stores during this year’s second quarter.
In afternoon trading on the New York Stock Exchange, Lowe’s shares rose $2.31, or 5.2 percent, to $47.07.
Looking ahead, Lowe’s said it expects earnings of 53 cents to 54 cents a share, compared with Wall Street’s consensus estimate of 51 cents.
The retailer also forecast that its earnings would be $1.66 to $1.69 a share for the year ending on Jan. 31, compared with Wall Street expectations of $1.58.