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LOWE'S ANNOUNCES FIRST QUARTER 1992 RESULTS SALES UP 27 PERCENT, EARNINGS UP 107 PERCENT

 LOWE'S ANNOUNCES FIRST QUARTER 1992 RESULTS
 SALES UP 27 PERCENT, EARNINGS UP 107 PERCENT
 NORTH WILKESBORO, N.C., May 14 /PRNewswire/ -- Lowe's (NYSE: LOW) record first quarter sales were 27 percent above last year's quarter. Earnings per share were $ .65, a 107 percent jump over last year's $ .31. Cash dividends were $ .14 per share, an 8 percent increase over the comparable quarter's $ .13 per share. Comparable store sales were up 22 percent.
 Financial Highlights
 (Dollars in Thousands, except per share data)
 Pct. First Quarter
 Change 1992 1991
 Sales + 27 $ 883,283 $ 693,351
 Cost of Sales + 27 670,068 525,933
 Gross Margin + 27 213,215 167,418
 Total Expenses + 18 178,501 150,988
 Pre-Tax Earnings +111 34,714 16,430
 Income Tax Provision +121 10,935 4,954
 Net Earnings +107 23,779 11,476
 Dividends + 8 $ 5,103 $ 4,704
 Per Share Data:(A)
 Earnings +107 $ .65 $ .31
 Dividends + 8 $ .14 $ .13
 Shares
 Outstanding - 36,529 36,526
 (Weighted Average in Thousands)
 (A) Per share data is computed from unrounded amounts
 STORE PERFORMANCE PERSPECTIVE
 During 1991, we reported sales and earnings comparisons of our 1989 expansion group stores with total chain averages. To further enhance understanding and analysis of the relative pace, progress, and performance of our new family of stores, compared to two older and smaller store groups, we are pleased to provide the information in the following tables.
 Table 1 Store Classification, End of First Quarter
 1992 1991 1990
 Old - Small (B) 106 127 141
 Medium (C) 121 129 130
 New - Large (D) 80 51 34
 Total Units 307 307 305
 (B) Pre 1984 Stores; Contractor Yards: Avg. 10,500 Sq.Ft.
 (C) '84 - '88 Stores; Avg. 24,000 Sq.Ft.
 (D) Post '88 Expansion Stores: Avg. 56,000 Sq.Ft.
 Table 1 Comments: The 106 old stores represent 35 percent of the total, the 121 "mid-sizers" represent 39 percent, and the 80 new stores now account for 26 percent of our total store count.
 Table 2 Sales Analysis by Store Classification, First Quarter
 1992 1991 1990
 Pct. of Pct. Pct. of Pct. Pct. of
 Total Change Total Change Total
 Old - Small 26 + 3 32 (20) 38
 Medium 41 + 12 47 ( 7) 49
 New - Large 33 + 98 21 + 58 13
 Total 100 100 100
 Table 2 Comments: The results shown in Table 2 need to be read in conjunction with the changing store numbers in Table 1, because these are aggregate totals, not comparable store results. The old - small store sales small increase of 3 percent is attributable to their reduction in number. Indeed the average small store in '92 posted a sales increase of about 23 percent. The average mid-sizer also achieved a 19 percent sales increase. The average new-large store's sales increase of 26 percent combined with their numerical increase provided 33 percent of total sales, up from 13 percent in 1990.
 Table 3 Operating Profits(E) by Store Classification, First Quarter
 1992 1991 1990
 Pct. of Pct. Pct. of Pct. Pct. of
 Total Change Total Change Total
 Old - Small 20 + 23 27 (52) 38
 Medium 44 + 33 53 (28) 50
 New - Large 36 +194 20 + 10 12
 Total 100 100 100
 (E) Profits before corporate expense, interest, restructuring, LIFO and Income Taxes.
 Table 3 Comments: Here's the report card on profitability and growth. Even though there are fewer old-small stores, their sales increases resulted in a 23 percent increase in operating profit contribution, compared to the severe decline of fiscal 1991. These are stores of the '70's designed for and needing reasonably healthy housing and durable sales demands.
 The mid-sizers are stores of the mid-80's. Their average sales per store were 39 percent higher than the old stores, in the first quarter, and their operating profit contribution grew by 33 percent.
 The new stores are designed for our customers of the '90's, and their response is gratifying. With an average sales per store 70 percent higher, and their operating profits more than double the old stores, and with more of them, the new stores contributed 36 percent of this quarter's earnings.
 SALES ANALYSIS
 Lowe's first quarter sales of $883.3 million were the highest quarterly sales total we have ever achieved. Indeed, it equaled our annual sales in fiscal 1980. The 27 percent sales gain combined a retail increase of 25 percent and a contractor gain of 33 percent, for a 69 percent-31 percent mix. Comparable store sales representing an average of 280 stores open more than one year, with comparable square footage, were $771.6 million, a 22 percent increase. We have been enjoying a relative improvement in our regional economy and improved construction activity during mild winter months. Importantly, our continued rebuilding of our stores, and our reinvestment into expanded product categories have positioned Lowe's for this substantial growth.
 CUSTOMER / MERCHANDISE SALES TRENDS
 Home center sales in the first quarter increased 27 percent with the strongest gains coming from kitchens, up 50 percent; home decor, up 31 percent; home illumination, up 28 percent; yard-patio-garden, up 34 percent; tools, up 31 percent; home care-safety, up 45 percent; and bathrooms, plus 26 percent. Millwork and structural lumber improved 18 percent. Contractor sales were driven by structural lumber, up 47 percent; building commodities, plus 26 percent; and millwork up 20 percent. In consumer durables, the greatest gain was in consumer electronics, up 34 percent; kitchen appliances, up 22 percent; and home water systems, up 30 percent.
 3 Months Ended April 30, 1992 vs 3 Months Ended April 30, 1991
 Dollars in Millions
 Pct. Fiscal Pct. Fiscal Pct.
 Sales Change 1992 Mix 1991 Mix
 Total +27 $ 883.3 100 $ 693.4 100
 Home Center +27 478.5 54 375.4 54
 Consumer Durables +16 131.8 15 113.2 16
 Contractor +33 $ 273.0 31 $ 204.8 30
 MARGIN ANALYSIS
 The LIFO gross margin for the first quarter was 24.14 percent versus 24.15 percent. This flat comparison masks two opposite trends in margin components, both of which we label as positive. We are continuing to implement lower everyday competitive prices, particularly in home center merchandise. This has helped to increase sales this quarter and bodes well for the future. The resulting reduction in margin basis points during this quarter was virtually offset by favorable trends in discontinued inventory pricing, inventory shrinkage and cash discount experience. Lower maintained margins from a higher contractor mix were exactly offset by higher margins from improved product "mix within the mix" results.
 EXPENSES
 Selling, general and administrative (SG&A) expenses for 1992's first quarter were 17.0 percent of sales versus 18.22 percent of sales last year. We experienced positive leverage with our 27 percent sales gain because store salaries were up 26 percent, general office expenses were up 11 percent, advertising increased 4 percent and other expenses increased an average of 17 percent. We had a favorable variance with our retail credit card program.
 The fiscal 1991 restructuring charge had an impact on our quarterly results because of expenses associated with relocating seven stores and closing two stores. The operating expense absorbed by the restructuring accrual was $1.5 million and the real estate and fixtures absorption was $1.4 million.
 Depreciation was $16.2 million in the quarter compared to $14 million last year, an increase of 16 percent. As a percent-to-sales, depreciation dropped from 2.01 percent to 1.84 percent. This investment was in additional computer equipment, fixtures and displays, vehicles and forklifts, real estate and other equipment which is all part of our multi year expansion program.
 Employee retirement plans expense was .96 percent of sales versus .99 percent in last year's first quarter. The dollar investment was up because of our ongoing increase in the number of employees who qualify for the plans and our higher salary base.
 Interest expense was $3.6 million compared to $3.9 million a year ago. Long-term debt interest expense declined because several of our existing notes were paid off in the fourth quarter of 1991 and in April 1992. Short-term interest expense was up over last year's quarter.
 The income tax rate was 31.50 percent. This increase over last year's rate of 30.15 percent in the first quarter is due to higher state income taxes.
 EXPANSION
 Our first quarter expansion included seven relocations, three new stores, one contractor yard conversion and two store closings, representing a total of 579,000 square feet of incremental retail space. Therefore, we ended the quarter with 8.6 million square feet of total selling space in 307 stores compared to 7.1 million square feet in 307 stores at the end of the first quarter in 1991.
 At the close of the first quarter our 80 new-large stores totaled 4.5 million square feet or 52 percent of total space. The 51 stores in this classification one year ago totaled 2.6 million square feet, representing 36 percent of total sales space.
 Continuing our commitment to revitalize Lowe's with larger stores, our expansion plans for the remainder of 1992 include 12 relocations in the second quarter; eight relocations in the third quarter; four relocations and one new store in the fourth quarter for a total of 31 relocations and four new stores representing approximately 2 million square feet of incremental space. At this point we will have 105 new- large stores, in strategic locations, and ten million square feet of total retail space at year end.
 We have announced our goal of expanding our sales floor square footage by 20 percent every year through 1995, so that by the end of that year we will have doubled our fiscal 1991 total retail space of eight million square feet to a number approximating 16 million square feet.
 Consolidated Condensed Statements of Current and Retained Earnings
 Lowe's Companies, Inc. and Subsidiary Companies
 Dollars In Thousands, Except Per Share Data
 Three months ended
 April 30, 1992 April 30, 1991
 Current Earnings Amount Percent Amount Percent
 Net sales $883,283 100.00 $693,351 100.00
 Cost of sales 670,068 75.86 525,933 75.85
 Gross margin 213,215 24.14 167,418 24.15
 Expenses:
 Selling, general
 and administrative 150,140 17.00 126,308 18.22
 Depreciation 16,231 1.84 13,966 2.01
 Employee retirement plans 8,483 0.96 6,851 0.99
 Interest 3,647 0.41 3,863 0.56
 Total expenses 178,501 20.21 150,988 21.78
 Pre-tax earnings 34,714 3.93 16,430 2.37
 Income tax provision 10,935 1.24 4,954 0.71
 Net earnings $23,779 2.69 $11,476 1.66
 Shares outstanding
 (weighted average) 36,529 36,526
 Earnings per share $0.65 $0.31
 Retained earnings
 Balance at beginning of
 period $480,186 $495,265
 Net earnings 23,779 11,476
 Cash dividends (5,103) (4,704)
 Balance at end of period $498,862 $502,037
 See accompanying notes to consolidated condensed financial statements.
 Consolidated Statements of Cash Flows
 Lowe's Companies, Inc. and Subsidiary Companies
 Dollars in Thousands
 For the three months ended
 April 30, 1992
 1992 1991
 Cash Flows from Operating Activities:
 Net Earnings $23,779 $11,476
 Adjustments to Reconcile Net Earnings
 to Net Cash Provided by
 Operating Activities:
 Depreciation 16,231 13,966
 Store Restructuring (2,889)
 Increase in Deferred Income Taxes 3,320
 Loss (Gain) on Disposition of Fixed
 and Other Assets (595) 23
 Cash Flow from Operations (F) 39,846 25,465
 Changes in Operating Assets and Liabilities:
 Decrease (Increase) in Operating Assets:
 Accounts Receivable-Net 64,565 (21,684)
 Merchandise Inventory (95,092) (56,306)
 Other Operating Assets (28,552) (1,256)
 Increase in Operating Liabilities:
 Accounts Payable 3,324 51,304
 Employee Retirement Plans 7,640 5,427
 Other Operating Liabilities 17,255 15,445
 Net Cash Provided by
 Operating Activities 8,986 18,395
 Cash Flows from Investing Activities:
 Decrease (Increase) in Investment Assets:
 Short-Term Investments (8,900) (2,429)
 Long-Term Investments (1,000)
 Other Long Term Assets 1,734 (566)
 Fixed Assets Acquired (58,745) (18,752)
 Proceeds from the Sale of Fixed
 and Other Long-Term Assets 3,467 752
 Net Cash Used in Investing Activities (63,444) (20,995)
 Cash Flows from Financing Activities:
 Sources:
 Net Increase in
 Short-Term Borrowings 91,102 12,678
 Stock Options Exercised 277 139
 Total Financing Sources 91,379 12,817
 Uses:
 Repayment of Long-term Debt (31,825) (2,206)
 Cash Dividend Payments (5,103) (4,704)
 Total Financing Uses (36,928) (6,910)
 Net Cash Provided
 by Financing Activities 54,451 5,907
 Net Increase (Decrease) in Cash and Cash (7) 3,307
 Cash and Cash Equivalents,
 Beginning of Period 26,088 15,034
 Cash and Cash Equivalents,
 End of Period $26,081 $18,341
 (F) Before adjustments for changes in related operating assets and operating liabilities.
 See accompanying notes to consolidated condensed financial statements.
 Consolidated Condensed Balance Sheets
 Lowe's Companies, Inc. and Subsidiary Companies
 Dollars in Thousands
 April 30,
 1992 1991
 Assets
 Current assets:
 Accounts receivable - net $51,174 $118,038
 Merchandise inventory 697,887 517,110
 Cash and other 88,989 66,295
 Total current assets 838,050 701,443
 Net fixed assets 657,395 546,620
 Other assets 59,154 44,549
 Total assets $1,554,599 $1,292,612
 Liabilities
 Current liabilities:
 Notes payable $254,046 $76,472
 Accounts payable 311,138 238,164
 Other 144,355 107,537
 Total current liabilities 709,539 422,173
 Long-term debt 88,035 157,355
 Deferred income taxes 9,278 23,500
 Accrued store
 restructuring costs 60,240
 Total liabilities 867,092 603,028
 Shareholders' equity 687,507 689,584
 Total liabilities
 and shareholders' equity $1,554,599 $1,292,612
 See accompanying notes to consolidated condensed financial statements.
 LOWE'S COMPANIES, INC. AND SUBSIDIARY COMPANIES
 1 QUARTERLY EARNINGS STATEMENTS
 Dollars in thousands
 QUARTER ENDED 04/30/92 01/31/92 10/31/91 07/31/91 04/30/91
 NET SALES $883,283 $709,613 $790,274 $863,009 $693,351
 FIFO GROSS MARGIN 214,757 175,602 187,881 209,110 168,644
 LIFO CREDIT (CHARGE) (1,542) (5,063) 604 (294) (1,226)
 LIFO GROSS MARGIN 213,215 170,539 188,485 208,816 167,418
 EXPENSES:
 S,G & A 150,140 137,647 143,030 146,337 126,308
 DEPRECIATION 16,231 15,603 14,471 14,258 13,966
 EMPLOYEE RETIREMENT
 PLANS 8,483 7,668 7,797 8,145 6,851
 INTEREST 3,647 5,255 4,019 3,801 3,863
 STORE RESTRUCTURING 71,288
 TOTAL EXPENSES 178,501 237,461 169,317 172,541 150,988
 PRE-TAX EARNINGS
 (LOSS) 34,714 (66,922) 19,168 36,275 16,430
 INCOME TAX PROVISION 10,935 (23,657) 6,176 10,991 4,954
 NET EARNINGS (LOSS) 23,779 (43,265) 12,992 25,284 11,476
 EARNINGS (LOSS) PER
 SHARE $0.65 ($1.19) $0.36 $0.69 $0.31
 2 QUARTERLY EARNINGS STATEMENT CHANGES
 Changes from same quarter previous year, to nearest tenth percent
 QUARTER ENDED 04/30/92 01/31/92 10/31/9 07/31/91 04/30/91
 NET SALES 27.4 21.1 11.6 5.5 -3.8
 FIFO GROSS MARGIN 27.3 17.8 7.5 2.8 -3.4
 LIFO CREDIT (CHARGE) 25.8 253.7 100.0 -74.9 -14.4
 LIFO GROSS MARGIN 27.4 11.9 7.9 3.2 -3.3
 EXPENSES:
 S,G & A 18.9 14.4 9.9 7.3 6.1
 DEPRECIATION 16.2 14.1 10.4 14.2 14.7
 EMPLOYEE RETIREMENT PLANS 23.8 13.3 11.3 8.6 7.3
 INTEREST -5.6 11.5 -16.0 -8.2 2.2
 STORE RESTRUCTURING
 TOTAL EXPENSES 18.2 63.3 9.2 7.5 6.8
 PRE-TAX EARNINGS (LOSS) 111.3 -1058.2 -2.5 -13.3 -48.3
 INCOME TAX PROVISION 120.7 -1332.1 10.6 -7.5 -49.4
 NET EARNINGS (LOSS) 107.2 -954.4 -7.7 -15.6 -47.8
 LOWE'S COMPANIES, INC. AND SUBSIDIARY COMPANIES
 3 QUARTERLY EARNINGS STATEMENT PERCENTAGES
 Percent of sales to nearest hundredth;
 income tax is a percentage of pre-tax earnings
 QUARTER ENDED 04/30/92 01/31/92 10/31/91 07/31/91 04/30/91
 NET SALES 100.00 100.00 100.00 100.00 100.00
 FIFO GROSS MARGIN 24.31 24.74 23.77 24.23 24.33
 LIFO CREDIT (CHARGE) -0.17 -0.71 0.08 -0.03 -0.18
 LIFO GROSS MARGIN 24.14 24.03 23.85 24.20 24.15
 EXPENSES:
 S,G & A 17.00 19.39 18.09 16.97 18.22
 DEPRECIATION 1.84 2.20 1.83 1.65 2.01
 EMPLOYEE RETIREMENT PLANS 0.96 1.08 0.99 0.94 0.99
 INTEREST 0.41 0.74 0.51 0.44 0.56
 STORE RESTRUCTURING 10.05
 TOTAL EXPENSES 20.21 33.46 21.42 20.00 21.78
 PRE-TAX EARNINGS (LOSS) 3.93 -9.43 2.43 4.20 2.37
 INCOME TAX PROVISION 31.50 35.35 32.22 30.30 30.15
 NET EARNINGS (LOSS) 2.69 -6.10 1.64 2.93 1.66
 4 CONDENSED QUARTERLY BALANCE SHEETS
 Dollars in millions
 QUARTER ENDED 04/30/92 01/31/92 10/31/91 07/31/91 04/30/91
 ASSETS:
 INVENTORY $697.9 $602.8 $552.3 $494.2 $517.1
 RECEIVABLES 51.2 115.7 133.5 133.4 118.0
 FIXED ASSETS 657.4 613.0 583.1 564.4 546.6
 ALL OTHER 148.1 109.7 100.4 93.6 110.9
 TOTAL $1,554.6 $1,441.2 $1,369.3 $1,285.6 $1,292.6
 EQUITY AND LIABILITIES:
 EQUITY $687.5 $668.6 $716.2 $710.1 $689.6
 PAYABLES 311.1 307.8 234.4 221.8 238.2
 DEBT 342.1 275.2 278.8 220.0 233.8
 ALL OTHER 213.9 189.6 139.9 133.7 131.0
 TOTAL $1,554.6 $1,441.2 $1,369.3 $1,285.6 $1,292.6
 5 QUARTERLY BALANCE SHEET CHANGES
 Changes from same quarter previous year, to nearest whole percent
 QUARTER ENDED 04/30/92 01/31/92 10/31/91 07/31/91 04/30/91
 ASSETS:
 INVENTORY 35 31 11 -2 0
 RECEIVABLES -57 20 -2 -7 -14
 FIXED ASSETS 20 13 9 7 6
 ALL OTHER 34 5 -11 -16 23
 TOTAL 20 20 7 -0 3
 EQUITY AND LIABILITIES:
 EQUITY 0 -2 4 2 4
 PAYABLES 31 65 26 6 -2
 DEBT 46 23 -1 -14 7
 ALL OTHER 63 72 10 3 -3
 TOTAL 20 20 7 -0 3
 6 QUARTERLY BALANCE SHEET COMPONENT PERCENTAGES
 To nearest whole percent
 QUARTER ENDED 04/30/92 01/31/92 10/31/91 07/31/91 04/30/91
 ASSETS:
 INVENTORY 45 42 40 38 40
 RECEIVABLES 3 8 7 7 8 9
 TOTAL 100 100 100 100 100
 EQUITY AND LIABILITIES:
 EQUITY 44 46 52 55 53
 PAYABLES 20 21 17 17 18
 DEBT 22 19 20 17 18
 ALL OTHER 14 14 11 11 11
 TOTAL 100 100 100 100 100
 Lowe's Companies, Inc. and Subsidiary Companies
 Notes to Consolidated Condensed Financial Statements
 Note 1: In the opinion of management, the accompanying consolidated condensed financial statements (unaudited) contain all adjustments necessary to present fairly the financial position as of April 30, 1992 and the results of operations and cash flows for the three-month periods ended April 30, 1992, and 1991.
 Note 2: The results of operations for the three-month periods ended April 30, 1992 and 1991 are not necessarily indicative of the results to be expected for the full year.
 Note 3: Interest and loan expense is net of interest income of $454,000 and $862,000 for the three-month periods ended April 30, 1992 and 1991, respectively. In addition, interest on construction in progress was capitalized in the amount of $329,000 and $137,000 for the three- month periods ended April 30, 1992 and 1991, respectively.
 Note 4: If the FIFO method of inventory accounting had been used, inventories would have been $41,045,000 higher at April 30, 1992 and $34,755,000 higher at April 30, 1991.
 Note 5: Stock options exercised consisted of 12,200 and 6,250 shares resulting in proceeds of $277,000 and $134,000 for the three-month periods ended April 30, 1992 and 1991, respectively.
 Note 6: Property is shown net of accumulated depreciation of $265,166,000 at April 30, 1992 and $245,513,000 at April 30, 1991.
 Note 7: Supplemental disclosures of cash flow information:
 Three months ended April 30 1992 1991
 Cash paid for interest (net
 of capitalized) $ 5,440,000 $ 4,810,000
 Cash paid for income taxes 79,000 1,426,000
 Non-cash investing and financing activities:
 Fixed assets acquired under capital lease 7,622,000
 Note 8: In October 1991, the Board of Directors authorized the expenditure of up to $50 million for the purchase, primarily in the open market, of the Company's common stock. The stock will be retired (authorized but unissued). As of January 31, 1992, the Company had repurchased 75,002 shares at a cost of $1,944,000 or an average of $24.92 per share. No shares were repurchased during the three-month period ending April 30, 1992. This program will expire on May 29, 1992.
 Note 9: On March 6, 1992, the Company sold a $100,471,000 undivided fractional interest in a designated pool of receivables receiving $75,000,000 in cash and a receivable of $25,471,000. As collections reduce previously sold interests in receivables, an interest in the new receivables may be sold under the agreement.
 Note 10: On April 1, 1992, the Company accelerated the retirement of the remaining $27,850,000 of its 11.5 percent unsecured notes. There was no early retirement penalty or cost associated with the retirement.
 Note 11: Long-term investments are recorded at cost which approximates market value.
 -0- 5/14/92
 /CONTACT: (Corporate Contacts) W. Cliff Oxford or Clarissa S. Felts, Lowe's Companies, Inc., 919-651-4631 or 919-651-4254/
 (LOW) CO: Lowe's Companies, Inc. ST: North Carolina IN: REA SU: ERN


CM -- CH008 -- 0378 05/14/92 15:49 EDT
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