The company has cut its 2010 expansion plans, with new store openings likely in the 35- to 45-unit range. Some 62 to 66 new stores will open in 2009. Several potential store sites will no longer be pursued.
The cuts are "part of the ongoing evaluation process we've been going through in a challenging environment," said Robert Niblock, chairman and CEO. "Obviously, things have been deeper and longer than we thought."
Given the two- to three-year development process for some projects, stores that made economic sense at signing may be cannibalizing existing units now, Niblock explained. However, urban sites more likely are to be spared.
"We still feel like we're understored in metro markets and feel it's a great opportunity," said Robert Hull, executive VP and CFO. "We'll continue with our infill strategies."
Hit by a triple whammy of economic turmoil, bad weather and comparisons against a year-ago stimulus bump, sales for the quarter declined 4.6% to $13.8 billion, down from $14.5 billion in the second quarter of 2008. Comparable store sales for the second quarter declined 9.5%. Net earnings were $759 million, down 19.1% from the same period a year ago.
As of July 31, 2009, Lowe's operated 1,688 stores in the United States and Canada.
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