Summary
Lowe's Companies, Inc. reported solid results for the second quarter and first half of fiscal year 2019, reflecting a 0.5% increase in net sales to $21.0 billion for the quarter and a 1.3% increase to $38.7 billion for the first six months. Diluted earnings per share saw a significant increase of 14.9% to $2.14 in the second quarter, driven by a combination of factors including the strategic exit from Mexico retail operations and strong comparable sales growth of 2.3% in the quarter, despite some headwinds like lumber deflation. The company demonstrated effective cost management, with SG&A expenses leveraging 170 basis points as a percentage of sales in the second quarter, largely due to prior year charges related to the Orchard Supply Hardware exit. Capital expenditures for the first six months were $526 million, with a forecast of approximately $1.6 billion for the full year. Lowe's also continued its commitment to returning capital to shareholders, paying $382 million in dividends and repurchasing $2.0 billion of common stock during the second quarter alone.
Financial Highlights
50 data points| Revenue | $20.99B |
| Cost of Revenue | $14.25B |
| Gross Profit | $6.74B |
| SG&A Expenses | $4.05B |
| Operating Income | $2.38B |
| Net Income | $1.68B |
| EPS (Basic) | $2.14 |
| EPS (Diluted) | $2.14 |
| Shares Outstanding (Basic) | 781.00M |
| Shares Outstanding (Diluted) | 781.00M |
Key Highlights
- 1Net sales increased by 0.5% to $21.0 billion in Q2 2019 and by 1.3% to $38.7 billion for the first six months of 2019, compared to the prior year periods.
- 2Diluted earnings per share (EPS) rose significantly, increasing by 14.9% to $2.14 in Q2 2019, and by 15.1% to $3.44 for the first six months of 2019.
- 3Comparable sales showed strength, increasing by 2.3% in the second quarter, indicating positive performance in existing stores.
- 4Selling, General, and Administrative (SG&A) expenses as a percentage of sales leveraged by 170 basis points in Q2 2019, reflecting improved operational efficiency.
- 5The company repurchased $2.0 billion of common stock in Q2 2019 and $2.77 billion year-to-date, demonstrating a strong commitment to returning capital to shareholders.
- 6Lowe's adopted new lease accounting standards (ASC 842) in Q1 2019, resulting in the recognition of significant operating lease right-of-use assets and liabilities on the balance sheet.
- 7The company is investing in strategic initiatives, including modernizing its Lowes.com website and opening a new global technology center, to enhance its omni-channel capabilities and long-term growth.