LOWE’S, THE second-largest US home-improvement retailer, has reported second-quarter profit that trailed analysts’ estimates as comparable-store sales fell. Net income fell 10 per cent to $747 million, from $830 million a year earlier, the company said yesterday.
Results fell short of expectations, chief executive officer Robert Niblock said. He has cut more than 500 corporate jobs this year after Lowe’s closed 27 US stores and cancelled plans for new locations. He is also working to boost profit by eliminating slow-selling items and shifting to everyday low prices with fewer promotions.
Sales by stores open at least a year fell 0.4 per cent in the quarter. Lowe’s cut its full-year profit forecast to $1.64 a share from a projection of $1.83 a share in May. It said it expected sales to be little changed, down from an expectation of a 1-2 per cent increase. Gross margin narrowed to 33.9 per cent from 34.5 per cent a year earlier.
Last month, Canada’s Rona rejected an unsolicited takeover offer of Can$1.76 billion (€1.31 billion) by Lowe’s. It would be its largest acquisition aimed at accelerating expansion in Canada, where it has opened 31 stores since 2007. – (Bloomberg)
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