During the fourth quarter, the home improvement retailer reported net earnings of $695 million for the fourth quarter fiscal 2005. Diluted earnings per share increased 35.9% to 87 cents from 64 cents for the same period last year. Further, sales increased 26.4% to $10.8 billion, up from $8.55 billion for fiscal 2004.
Wall Street analysts, on average, had been expecting Lowe's to earn 80 cents a share on sales of $10.44 billion, according to Thomson First Call.
Lowe's chairman, president and CEO Robert Niblock said during the company's earnings conference call that sales increased in all but one key merchandise categories. Specifically, the seasonal living category underperformed because of warm weather. "We also continue to gain market share in key categories previously dominated by other channels, including appliances, outdoor power equipment, and cabinets and countertops," Niblock said during the call.
During the fourth quarter, Lowe's opened 63 new stores and reopened one store temporarily closed as a result of hurricane Katrina, bringing its total to 1,234 stores in 49 states. This year, the chain expects to open 155 stores in 2006 reflecting total sf growth of approximately 12%.
For the first quarter, Lowe's forecast earnings in a range of 92 cents to 94 cents a share, and a total sales increase of 19% to 20%. Same-store sales are expected to rise 5% to 7%, according to the company. Second-quarter earnings are forecast at $1.22 to $1.25, with total sales up 13% to 14%. For the year, Lowe's is targeting earnings of $4.03 to $4.13, and total sales increases of 13% to 14%.
Analysts polled by Thomson First Call were expecting first-quarter earnings of 88 cents a share and sales of $11.45 billion, along with earnings for the year of $3.95 a share on sales of $48.73 billion.
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