Lowe’s earnings down 8%
Repairs to drought-stricken flower beds and sales of freezers designed to hold bulk food helped Lowe’s Cos. post better-than-expected profit for its fiscal second quarter.
But the nation’s faltering economy and sluggish housing industry still sent profit at the nation’s second-largest home improvement chain down nearly 8%.
For the three months that ended Aug. 1, results were boosted in part by consumers who undertook small outdoor gardening projects -- repairing their yards from last year’s drought -- and bought freezers to accommodate bulk food purchases to cope with soaring grocery prices.
Analysts said the second-quarter sales boost probably wasn’t sustainable, as penny-pinching homeowners scale back spending and do-it-yourself projects. It’s a sentiment the Mooresville, N.C.-based company echoed as it lowered its third-quarter forecast while raising its full-year outlook.
For the period, Lowe’s earned $938 million, or 64 cents a share, down from $1.02 billion, or 67 cents, a year earlier. Sales rose 2.4% to $14.5 billion.
Analysts surveyed by Thomson Reuters expected a smaller profit of 56 cents a share on lower revenue of $14.1 billion.
Lowe’s said it expected earnings in the range of 27 cents to 31 cents a share in the fiscal third quarter, which ends Oct. 31. Thomson Reuters said analysts were expecting 33 cents a share.
For the fiscal year, however, Lowe’s raised its earnings guidance to a range of $1.48 to $1.56 a share.
Lowe’s shares rose 4 cents to $24.54.