CHARLOTTE, N.C. – Lowe's Cos. (LOW), which operates the nation's second largest home improvement chain, said Wednesday its earnings rose nearly 27 percent in the fourth quarter on a nearly 18 percent increase in sales.
While its results beat Wall Street expectations, its forecast for the first quarter fell short of the consensus. Its shares fell 23 cents to $57.30 on the New York Stock Exchange (search).
Lowe's said it earned $508 million, or 64 cents per share, in the three months ended Jan. 28, up from $407 million, or 49 cents a share, a year ago. Sales increased to $8.55 billion from $7.25 billion in the fourth quarter of 2003.
Analysts surveyed by Thomson First Call were looking for earnings of 59 cents per share on sales of $8.4 billion.
For the fiscal year that ended in January, earnings grew to $2.18 billion, or $2.71 a share, versus $1.88 billion, or $2.32 a share, a year earlier. Annual sales increased to $36.46 billion from $30.84 billion a year earlier.
Lowe's said the results set company records for the quarter and the year.
"The results our stores delivered in the fourth quarter highlighted a great year for Lowe's," said Robert Niblock, Lowe's chairman and chief executive.
Niblock said the company also spent more than $400 million to upgrade existing stores and "ensure the bright, clean, inspirational shopping environment."
During the quarter, Lowe's opened 56 new stores. Lowe's operates 1,087 stores in 48 states representing 123.7 million square feet of retail selling space, a 13.8 percent increase over last year.
The results were announced a day after Atlanta-based Home Depot (HD), the nation's largest home improvement chain, reported a nearly 10 percent jump in fourth-quarter earnings.
Lowe's also provided earnings guidance for the first quarter and all of next year, saying it expects its profit in the quarter to range between 75 cents and 77 cents per share, which is below the 80 cents a share analysts' consensus.
For the full year, Lowe's predicts its earnings will range between $3.25 and $3.34 per share, while analysts are predicting $3.34 per share.