Amidst a bleak economic outlook, Lowe’s Companies Inc. (LOW) recently reported its third quarter results. Quarterly earnings of 24 cents a share fell 27.3% from 33 cents posted in the prior-year quarter due to sluggish consumer demand for big renovations. However, the earnings remained in line with the Zacks Consensus Estimate.
The world’s second largest home improvement retailer said that it expected fourth-quarter earnings in the range of 9 cents to 13 cents a share. For the fiscal 2009, earnings are expected between $1.16 and $1.20 per share.
On a reported basis, including one-time items, earnings came in at 23 cents a share, down 30.3% year on year.
Lowe’s hinted that the markets of California and Florida, which were battered by the housing downturn, are showing some signs of revival.
Net sales for the quarter tumbled 3% to $11,375 million as cash-strapped consumers continue to prioritize their purchases and hold back on remodeling projects. Management expects sales in the fourth quarter to be flat compared to last year but to fall between 2% and 3% in fiscal 2009.
Comparable store sales for the quarter dipped 7.5%. Lowe’s expects comps to fall between 2% and 6% in the fourth quarter and to slip in the range of 7% to 8% in fiscal year 2009.
During the quarter, Lowe’s opened 12 stores and closed one. The company expects to open 13 new stores in fourth-quarter 2009, besides 64 stores in fiscal year 2009.
Lowe’s ended the quarter with cash and cash equivalents of $1,141 million, total long-term debt of $5,077 million and shareholders’ equity of $19,419 million.
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