Lowe's Posts Decline In Q4 Sales

Lowe's Companies, Inc. today reported net earnings of $1.0 billion and diluted earnings per share (EPS) of $1.77 for the quarter ended Feb. 2, 2024, compared to diluted EPS of $1.58 in the fourth quarter of 2022, which included pre-tax transaction costs of $441 million associated with the sale of our Canadian retail business.  Excluding the transaction costs in the prior year, fourth quarter 2022 adjusted diluted EPS (1) was $2.28.

Total sales for the quarter were $18.6 billion,(2) compared to $22.4 billion in the prior year quarter. Prior-year quarterly sales included approximately $1.4 billion from the additional 53rd week, as well as $958 million generated from our Canadian retail business.

Comparable sales(3) for the quarter decreased 6.2% due to a slowdown in DIY demand and unfavorable January winter weather, while Pro customer comparable sales were flat for the quarter.

"This quarter we delivered strong operating profit and improved customer satisfaction, despite the continued pullback in DIY spending," commented Marvin R. Ellison, Lowe's chairman, president and CEO. "We remain confident in the long-term strength of the home improvement market, and we are making the right investments in our Total Home strategy to take share. We are also pleased to award $140 million in discretionary bonuses to our frontline associates in recognition of their exceptional customer service in 2023."

As of Feb. 2, 2024, Lowe's operated 1,746 stores representing 194.9 million square feet of retail selling space.

Capital Allocation
The company remains committed to a best-in-class capital allocation strategy focused on driving long-term, sustainable shareholder value. During the quarter, the company repurchased approximately 1.9 million shares for $404 million, and it repurchased 29.9 million shares for $6.3 billion for the year.

The company also paid $633 million in dividends in the fourth quarter and $2.5 billion in dividends for the year. In total, the company returned $8.9 billion to shareholders through share repurchases and dividends in fiscal 2023.

1 Adjusted diluted earnings per share is a non-GAAP financial measure. Refer to the "Non-GAAP Financial Measures Reconciliation" section of this release for additional information, as well as reconciliations between the Company's GAAP and non-GAAP financial results.

2 Total fourth quarter sales includes an approximately $200 million headwind related to a timing shift in our fiscal calendar as we cycle over a 53-week year.

3 Comparable sales are based on comparison to weeks 41-53 in 2022. 

Lowe's Business Outlook

The company is introducing its outlook for full year 2024, which reflects near-term macroeconomic uncertainty.

Full Year 2024 Outlook

• Total sales of $84 to $85 billion
• Comparable sales expected to be down -2 to -3% as compared to prior year
• Operating income as a percentage of sales (operating margin) of 12.6% to 12.7%
• Interest expense of approximately $1.4 billion
• Effective income tax rate of approximately 25%
• Diluted earnings per share of approximately $12.00 to $12.30
• Capital expenditures of approximately $2 billion

Source : Lowe's Companies, Inc

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