Lowe’s produced a solid fourth quarter, driven by the company’s U.S. store base and supported by its continuing investments in technology and e-commerce.
The home improvement retailer reported net earnings of $509 million and diluted earnings per share of $0.66 for the quarter ended January 31, 2020, which included pre-tax operating costs and charges of $185 million, compared to a net loss of $824 million and diluted loss per share of $1.03 in the fourth quarter of 2018.
The pre-tax operating costs and charges resulted from the company’s previously disclosed strategic review of its Canadian operations and closure of its Mexico business, resulting in pre-tax operating costs and charges of $185 million consisting of inventory liquidation, accelerated depreciation and amortization, severance and other costs.
Sales for the fourth quarter were $16 billion compared to $15.6 billion in the fourth quarter of 2018, and comparable sales increased 2.5%. Comparable sales for the U.S. home improvement business increased 2.6% for the fourth quarter.
“In the fourth quarter, we delivered profitability that exceeded our expectations given strong expense management, improving gross margin and enhanced process execution. Our sales growth was driven almost entirely by our U.S. brick and mortar stores, supported by our investments in technology, store environment and the pro business. We have a detailed road map in place to modernize our e-commerce platform and accelerate Lowes.com sales, which combined with the sales productivity improvement in our physical stores, underscores our opportunity to unlock additional growth,” said Marvin Ellison, Lowe’s president and CEO.
“Though we are only one year into a multi-year plan, we made significant progress transforming our company and believe we are well positioned to capitalize on solid demand in a healthy home improvement market. We are entering 2020 from a position of strength and remain confident that our focus on retail fundamentals combined with technology improvements will continue to pay dividends across the business,” added Ellison.