— Consolidated Comparable Sales Decreased
4.0%; U.S. Comparable Sales Decreased 3.8% —
— Represents
U.S. Comparable Sales Increase on a Two-Year Basis of 19.7%
—
— First Quarter Diluted EPS of $3.51 —
— Affirms Fiscal 2022 Outlook
—
MOORESVILLE, N.C., May 18, 2022
/PRNewswire/ -- Lowe's Companies, Inc. (NYSE: LOW) today reported
net earnings of $2.3 billion, in line
with prior-year results, and diluted earnings per share (EPS) of
$3.51 for the quarter ended
April 29, 2022, compared to diluted EPS of $3.21 in the first quarter of 2021.
Total sales for the first quarter were $23.7 billion compared to $24.4 billion in the first quarter of 2021, and
comparable sales decreased 4.0%. Comparable sales for the
U.S. home improvement business decreased 3.8% for the first
quarter. Pro customer sales increased 20%.
"Our sales this quarter were in line with our expectations,
excluding our outdoor seasonal categories that were impacted by
unseasonably cold temperatures in April. Because 75% of our
customer base is DIY, our Q1 sales were disproportionately impacted
by the cooler spring temperatures. Now that spring has
finally arrived, we are pleased with the improved sales trends we
are seeing in May," commented Marvin
R. Ellison, Lowe's chairman, president and CEO. "This
quarter we delivered over 65 basis points of operating margin
improvement, driven by our Total Home strategy and the execution of
our Perpetual Productivity Improvement or PPI initiatives.
Despite some increased uncertainty in the macro environment, we
remain confident in the outlook for the home improvement market and
our ability to deliver operating margin expansion in 2022. I
would like to thank our front-line associates for their ongoing
commitment to our customers and our communities."
Capital Allocation
The company continues to execute a disciplined capital
allocation strategy to deliver long-term, sustainable shareholder
value. During the quarter, the company repurchased approximately 19
million shares for $4.1 billion, and
it paid $537 million in
dividends.
The company is affirming its outlook for the operating results
of Full Year 2022.
Full Year 2022 Outlook -- a 53-week Year (comparisons to full
year 2021 -- a 52-week year)
- Total sales of $97 billion to
$99 billion, including the 53rd
week
- 53rd week expected to increase total sales by approximately
$1.0 billion to $1.5 billion
- Comparable sales expected to range from a decline of 1% to an
increase of 1%
- Gross margin rate up slightly compared to prior year
- Depreciation and amortization of approximately $1.75 billion
- Operating income as a percentage of sales (operating margin) of
12.8% to 13.0%
- Interest expense of $1.0 to
$1.1 billion
- Effective income tax rate of approximately 25%
- Diluted earnings per share of $13.10 to $13.60
- Total share repurchases of approximately $12 billion
- ROIC1 of over 36%
- Capital expenditures of approximately $2
billion
A conference call to discuss first quarter 2022 operating
results is scheduled for today, Wednesday,
May 18, at 9:00 am ET.
The conference call will be available by webcast and can be
accessed by visiting Lowe's website at ir.lowes.com and clicking on
Lowe's First Quarter 2022 Earnings Conference Call Webcast.
Supplemental slides will be available approximately 15 minutes
prior to the start of the conference call. A replay of the
call will be archived at ir.lowes.com.
As of April 29, 2022, Lowe's operated 1,971 home
improvement and hardware stores in the
United States and Canada
representing 208 million square feet of retail selling space, and
it serviced approximately 230 dealer-owned stores.
Lowe's Companies, Inc. (NYSE: LOW) is a FORTUNE® 50 home
improvement company serving approximately 19 million customer
transactions a week in the United
States and Canada. With
fiscal year 2021 sales of over $96
billion, Lowe's and its related businesses operate or
service nearly 2,200 home improvement and hardware stores and
employ over 300,000 associates. Based in Mooresville, N.C., Lowe's supports the
communities it serves through programs focused on creating safe,
affordable housing and helping to develop the next generation of
skilled trade experts. For more information, visit Lowes.com.
Disclosure Regarding
Forward-Looking Statements
|
This press release includes "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Statements including words such as "believe", "expect",
"anticipate", "plan", "desire", "project", "estimate", "intend",
"will", "should", "could", "would", "may", "strategy", "potential",
"opportunity", "outlook", "scenario", "guidance", and similar
expressions are forward-looking statements. Forward-looking
statements involve, among other things, expectations, projections,
and assumptions about future financial and operating results,
objectives, business outlook, priorities, sales growth, shareholder
value, capital expenditures, cash flows, the housing market, the
home improvement industry, demand for products and services, share
repurchases, Lowe's strategic initiatives, including those relating
to acquisitions and dispositions and the impact of such
transactions on our strategic and operational plans and financial
results. Such statements involve risks and uncertainties and
we can give no assurance that they will prove to be correct.
Actual results may differ materially from those expressed or
implied in such statements.
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 volatility and/or lack of liquidity from time
to time in U.S. and world financial markets and the consequent
reduced availability and/or higher cost of borrowing to Lowe's and
its customers, slower rates of growth in real disposable personal
income that could affect the rate of growth in consumer spending,
inflation and its impacts on discretionary spending and on our
costs, shortages, and other disruptions in the labor supply,
interest rate and currency fluctuations, home price appreciation or
decreasing housing turnover, the availability of consumer credit
and of mortgage financing, trade policy changes or additional
tariffs, outbreaks of pandemics, fluctuations in fuel and energy
costs, inflation or deflation of commodity prices, natural
disasters, armed conflicts, acts of both domestic and international
terrorism, and other factors that can negatively affect our
customers.
Investors and others should carefully consider the foregoing
factors and other uncertainties, risks and potential events
including, but not limited to, those described in "Item 1A - Risk
Factors" in our most recent Annual Report on Form 10-K and as may
be updated from time to time in Item 1A in our quarterly reports on
Form 10-Q or other subsequent filings with the SEC. All such
forward-looking statements speak only as of the date they are made,
and we do not undertake any obligation to update these statements
other than as required by law.
LOW-IR
Contacts:
|
Shareholder/Analyst Inquiries:
|
|
Media Inquiries:
|
|
Kate
Pearlman
|
|
Steve
Salazar
|
|
704-775-3856
|
|
704-758-4345
|
|
kate.pearlman@lowes.com
|
|
steve.j.salazar@lowes.com
|
1 Return on Invested Capital (ROIC) is calculated
using a non-GAAP financial measure. The Company does not provide a
reconciliation for non-GAAP estimates on a forward-looking basis
where it is unable to provide a meaningful or accurate calculation
or estimation of reconciling items and the information is not
available without unreasonable effort.
Lowe's Companies,
Inc.
|
Consolidated
Statements of Current Earnings and (Accumulated Deficit)/Retained
Earnings (Unaudited)
|
In Millions, Except Per
Share and Percentage Data
|
|
|
Three Months
Ended
|
|
April 29,
2022
|
|
April 30,
2021
|
Current
Earnings
|
Amount
|
|
%
Sales
|
|
Amount
|
|
%
Sales
|
Net
sales
|
$
23,659
|
|
100.00
|
|
$
24,422
|
|
100.00
|
Cost of
sales
|
15,609
|
|
65.97
|
|
16,292
|
|
66.71
|
Gross
margin
|
8,050
|
|
34.03
|
|
8,130
|
|
33.29
|
Expenses:
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
4,303
|
|
18.19
|
|
4,494
|
|
18.40
|
Depreciation and
amortization
|
445
|
|
1.88
|
|
391
|
|
1.60
|
Operating
income
|
3,302
|
|
13.96
|
|
3,245
|
|
13.29
|
Interest –
net
|
243
|
|
1.03
|
|
211
|
|
0.87
|
Pre-tax
earnings
|
3,059
|
|
12.93
|
|
3,034
|
|
12.42
|
Income tax
provision
|
726
|
|
3.07
|
|
713
|
|
2.92
|
Net
earnings
|
$
2,333
|
|
9.86
|
|
$
2,321
|
|
9.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding – basic
|
660
|
|
|
|
718
|
|
|
Basic earnings per
common share (1)
|
$
3.52
|
|
|
|
$
3.22
|
|
|
Weighted average common
shares outstanding – diluted
|
662
|
|
|
|
720
|
|
|
Diluted earnings per
common share (1)
|
$
3.51
|
|
|
|
$
3.21
|
|
|
Cash dividends per
share
|
$
0.80
|
|
|
|
$
0.60
|
|
|
|
|
|
|
|
|
|
|
(Accumulated
Deficit)/Retained Earnings
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
$
(5,115)
|
|
|
|
$
1,117
|
|
|
Net earnings
|
2,333
|
|
|
|
2,321
|
|
|
Cash dividends
declared
|
(524)
|
|
|
|
(430)
|
|
|
Share
repurchases
|
(4,061)
|
|
|
|
(2,910)
|
|
|
Balance at end of
period
|
$
(7,367)
|
|
|
|
$
98
|
|
|
|
|
|
|
|
|
|
|
(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 $2,325 million for the three
months ended April 29, 2022, and $2,312 million for the three
months ended April 30, 2021.
|
Lowe's Companies,
Inc.
|
Consolidated
Statements of Comprehensive Income (Unaudited)
|
In Millions, Except
Percentage Data
|
|
|
Three Months
Ended
|
|
April 29,
2022
|
|
April 30,
2021
|
|
Amount
|
|
%
Sales
|
|
Amount
|
|
%
Sales
|
Net
earnings
|
$
2,333
|
|
9.86
|
|
$
2,321
|
|
9.50
|
Foreign currency
translation adjustments – net of tax
|
(17)
|
|
(0.07)
|
|
102
|
|
0.41
|
Cash flow hedges – net
of tax
|
219
|
|
0.93
|
|
24
|
|
0.10
|
Other
|
(2)
|
|
(0.01)
|
|
(1)
|
|
—
|
Other comprehensive
income
|
200
|
|
0.85
|
|
125
|
|
0.51
|
Comprehensive
income
|
$
2,533
|
|
10.71
|
|
$
2,446
|
|
10.01
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated Balance
Sheets (Unaudited)
|
In Millions, Except Par
Value Data
|
|
|
|
|
|
|
|
|
|
|
April 29, 2022
|
|
April 30, 2021
|
|
January 28, 2022
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
3,414
|
|
$
6,692
|
|
$
1,133
|
Short-term investments
|
|
368
|
|
454
|
|
271
|
Merchandise inventory – net
|
|
20,239
|
|
18,382
|
|
17,605
|
Other current assets
|
|
1,590
|
|
1,288
|
|
1,051
|
Total current
assets
|
|
25,611
|
|
26,816
|
|
20,060
|
Property, less accumulated depreciation
|
|
18,890
|
|
19,059
|
|
19,071
|
Operating lease right-of-use assets
|
|
4,131
|
|
3,886
|
|
4,108
|
Long-term investments
|
|
76
|
|
197
|
|
199
|
Deferred income taxes – net
|
|
33
|
|
213
|
|
164
|
Other assets
|
|
984
|
|
1,029
|
|
1,038
|
Total
assets
|
|
$
49,725
|
|
$
51,200
|
|
$
44,640
|
|
|
|
|
|
|
|
Liabilities and shareholders'
(deficit)/equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Current maturities of long-term debt
|
|
$
121
|
|
$
1,338
|
|
$
868
|
Current operating lease liabilities
|
|
639
|
|
551
|
|
636
|
Accounts payable
|
|
13,831
|
|
13,964
|
|
11,354
|
Accrued compensation and employee benefits
|
|
1,190
|
|
1,312
|
|
1,561
|
Deferred revenue
|
|
2,094
|
|
2,022
|
|
1,914
|
Other current liabilities
|
|
3,956
|
|
3,705
|
|
3,335
|
Total current
liabilities
|
|
21,831
|
|
22,892
|
|
19,668
|
Long-term debt, excluding current maturities
|
|
28,776
|
|
21,906
|
|
23,859
|
Noncurrent operating lease liabilities
|
|
4,061
|
|
3,925
|
|
4,021
|
Deferred revenue – Lowe's protection plans
|
|
1,137
|
|
1,050
|
|
1,127
|
Other liabilities
|
|
797
|
|
982
|
|
781
|
Total
liabilities
|
|
56,602
|
|
50,755
|
|
49,456
|
|
|
|
|
|
|
|
Shareholders' (deficit)/equity:
|
|
|
|
|
|
|
Preferred stock, $5 par
value: Authorized – 5.0 million shares; Issued and
outstanding – none
|
|
—
|
|
—
|
|
—
|
Common stock, $0.50 par
value: Authorized – 5.6 billion shares; Issued
and outstanding – 652 million, 715 million, and
670 million shares, respectively
|
|
326
|
|
358
|
|
335
|
Capital in excess of
par value
|
|
—
|
|
—
|
|
—
|
(Accumulated
deficit)/retained earnings
|
|
(7,367)
|
|
98
|
|
(5,115)
|
Accumulated other
comprehensive income/(loss)
|
|
164
|
|
(11)
|
|
(36)
|
Total shareholders'
(deficit)/equity
|
|
(6,877)
|
|
445
|
|
(4,816)
|
Total liabilities and shareholders'
(deficit)/equity
|
|
$
49,725
|
|
$
51,200
|
|
$
44,640
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated
Statements of Cash Flows (Unaudited)
|
In Millions
|
|
|
Three Months
Ended
|
|
April 29,
2022
|
|
April 30,
2021
|
Cash flows from
operating activities:
|
|
|
|
Net
earnings
|
$
2,333
|
|
$
2,321
|
Adjustments to reconcile net earnings to net cash provided by
operating activities:
|
|
|
|
Depreciation and amortization
|
503
|
|
443
|
Noncash lease expense
|
135
|
|
124
|
Deferred income taxes
|
59
|
|
110
|
Loss/(gain) on property and other assets – net
|
4
|
|
(15)
|
Share-based payment expense
|
50
|
|
54
|
Changes in operating assets and liabilities:
|
|
|
|
Merchandise inventory –
net
|
(2,646)
|
|
(2,123)
|
Other operating
assets
|
(212)
|
|
(343)
|
Accounts payable
|
2,479
|
|
3,058
|
Deferred revenue
|
191
|
|
442
|
Other operating
liabilities
|
81
|
|
421
|
Net cash provided by operating activities
|
2,977
|
|
4,492
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Purchases of investments
|
(109)
|
|
(293)
|
Proceeds from sale/maturity of investments
|
132
|
|
347
|
Capital expenditures
|
(343)
|
|
(461)
|
Proceeds from sale of property and other long-term
assets
|
10
|
|
64
|
Other – net
|
—
|
|
(134)
|
Net cash used in investing activities
|
(310)
|
|
(477)
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Net
proceeds from issuance of debt
|
4,964
|
|
1,988
|
Repayment of debt
|
(773)
|
|
(543)
|
Proceeds from issuance of common stock under share-based
payment plans
|
1
|
|
9
|
Cash dividend payments
|
(537)
|
|
(440)
|
Repurchases of common stock
|
(4,037)
|
|
(3,038)
|
Other – net
|
(4)
|
|
4
|
Net cash used in financing activities
|
(386)
|
|
(2,020)
|
|
|
|
|
Effect of exchange
rate changes on cash
|
—
|
|
7
|
|
|
|
|
Net increase in cash
and cash equivalents
|
2,281
|
|
2,002
|
Cash and cash
equivalents, beginning of period
|
1,133
|
|
4,690
|
Cash and cash
equivalents, end of period
|
$
3,414
|
|
$
6,692
|
|
|
|
|
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SOURCE Lowe's Companies, Inc.