MOORESVILLE, N.C., Nov. 16, 2016 /PRNewswire/ -- Lowe's Companies,
Inc. (NYSE: LOW) today reported net earnings of $379 million and diluted earnings per share of
$0.43 for the quarter ended
October 28, 2016, which includes
certain non-cash pre-tax charges of $462
million further described below. Excluding the impact of
these charges, adjusted net earnings1 for the third
quarter were $775 million, a 5.3
percent increase over net earnings from the same period a year ago,
and adjusted diluted earnings per share1 increased 10.0
percent to $0.88 from diluted
earnings per share of $0.80 in the
third quarter of 2015.
For the nine months ended October 28,
2016, net earnings were $2.4
billion and diluted earnings per share were $2.73. Excluding the impact of the non-cash
charges, as well as the net gain in the first half of the year on
the settlement of a foreign currency hedge entered into in advance
of the company's acquisition of RONA, inc. (RONA), adjusted net
earnings1 were $2.8
billion, an increase of 9.7 percent over net earnings from
the same period a year ago, and adjusted diluted earnings per
share1 increased 15.6 percent to $3.12 from diluted earnings per share of
$2.70 in the same period a year
ago.
The non-cash pre-tax charges referenced above consisted of the
following:
- $290 million resulting from the
wind down of Hydrox, a joint venture in which Lowe's holds a
one-third ownership interest. Woolworths, the other joint
venture partner, claimed a unilateral termination of the joint
venture agreement and initiated the wind down of Hydrox in August,
2016. Hydrox operates Masters Home Improvement stores and
Home Timber and Hardware Group's retail stores in Australia.
Lowe's will treat its claim for additional value under the joint
venture agreement, above and beyond any amounts expected to be
received through the wind down process, as a contingent asset and
will recognize these amounts as they are realized. This
matter is currently in arbitration;
- $96 million related to a
write-off for projects that were canceled as part of the company's
ongoing review of strategic initiatives in an effort to focus on
the critical projects that will drive desired outcomes; and
- $76 million related to goodwill
and long-lived asset impairments associated with the company's
Orchard Supply Hardware operations as part of a strategic
reassessment of this business during the third quarter.
1
|
Adjusted net earnings
and adjusted diluted earnings per share are non-GAAP financial
measures. Refer to the "Non-GAAP Financial Measures Reconciliation"
section of this release for additional information as well as
reconciliations between the Company's GAAP and non-GAAP financial
results.
|
|
|
Sales for the third quarter increased 9.6 percent to
$15.7 billion from $14.4 billion in the third quarter of 2015, and
comparable sales increased 2.7 percent. For the nine month period,
sales were $49.2 billion, a 7.4
percent increase over the same period a year ago, and comparable
sales increased 3.9 percent. Comparable sales for the U.S. home
improvement business increased 2.6 percent for the third quarter
and 3.9 percent for the nine month period.
"Our third quarter operating results were below our expectations
due to slower sales in the first two months of the quarter,"
commented Robert A. Niblock, Lowe's
chairman, president and CEO. "While we expected moderation in
the second half of the year, traffic slowed more than we
anticipated in August and September before improving in October,
which put pressure on our profitability in the quarter.
"While we have made progress in driving productivity in recent
years, we are in the process of evaluating meaningful incremental
opportunities to drive shareholder value while continuing to meet
customers' needs in an omni-channel environment," Niblock
added.
Delivering on its commitment to return excess cash to
shareholders, the company repurchased $550
million of stock under its share repurchase program and paid
$309 million in dividends in the
third quarter. For the nine month period, the company repurchased
nearly $3.0 billion of stock under
its share repurchase program and paid $815
million in dividends.
As of October 28, 2016, Lowe's
operated 2,119 home improvement and hardware stores in the United States, Canada and Mexico representing 212.8 million square feet
of retail selling space.
A conference call to discuss third quarter 2016 operating
results is scheduled for today (Wednesday,
November 16) at 9:00 am
ET. The conference call will be available by webcast
and can be accessed by visiting Lowe's website at
www.Lowes.com/investor and clicking on Lowe's Third Quarter 2016
Earnings Conference Call Webcast. Supplemental slides will be
available fifteen minutes prior to the start of the conference
call. A replay of the call will be archived on Lowes.com/investor
until February 28, 2017.
Lowe's Business Outlook
Based on year-to-date operating performance and revised
expectations for the fourth quarter, the company is updating its
Fiscal Year 2016 Business Outlook.
Fiscal Year 2016 -- a 53-week Year (comparisons to fiscal
year 2015 -- a 52-week year; based on U.S. GAAP)
- Total sales are expected to increase 9 to 10 percent, including
the 53rd week
- The 53rd week is expected to increase total sales by
approximately 1.5 percent
- Comparable sales are expected to increase 3 to 4 percent
- The company expects to add approximately 40 home improvement
and hardware stores.
- Earnings before interest and taxes as a percentage of sales
(operating margin) are expected to increase approximately 65 basis
points.2
- The effective income tax rate is expected to be approximately
40.1%.
- Diluted earnings per share of approximately $3.522 are expected for the fiscal
year ending February 3,
2017.
2
|
Includes the net gain
on the settlement of the foreign currency hedge entered into in
advance of the company's acquisition of RONA(1Q 2016 and 2Q 2016)
and the impact of non-cash charges associated with the joint
venture with Woolworths in Australia (4Q 2015 and 3Q2016), the
project write-offs that were a part of the ongoing review of the
company's strategic initiatives (3Q2016) , and the goodwill and
long-lived asset impairment charges associated with the company's
Orchard Supply Hardware operations (3Q2016).
|
Cautionary Note Regarding Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Statements including words such as "believe", "expect",
"anticipate", "plan", "desire", "project", "estimate", "intend",
"will", "should", "could", "would", "may", "strategy", "potential",
"opportunity" and similar expressions are forward-looking
statements. Forward-looking statements involve estimates,
expectations, projections, goals, forecasts, assumptions, risks and
uncertainties. Forward-looking statements include, but are
not limited to, statements about future financial and operating
results, Lowe's plans, objectives, business outlook, expectations
and intentions, expectations for sales growth, comparable sales,
earnings and performance, shareholder value, capital expenditures,
cash flows, the housing market, the home improvement industry,
demand for services, share repurchases, Lowe's strategic
initiatives, including those regarding the acquisition by Lowe's
Companies, Inc. of RONA, inc. and the expected impact of the
transaction on Lowe's strategic and operational plans and financial
results, and any statement of an assumption underlying any of the
foregoing and other statements that are not historical facts.
Although we believe that the expectations, opinions, projections
and comments reflected in these forward-looking statements are
reasonable, such statements involve risks and uncertainties and we
can give no assurance that such statements will prove to be
correct. Actual results may differ materially from those expressed
or implied in such statements.
A wide variety of potential risks, uncertainties and other
factors could materially affect our ability to achieve the results
either expressed or implied by these forward-looking statements
including, but not limited to, changes in general economic
conditions, such as the rate of unemployment, interest rate and
currency fluctuations, fuel and other energy costs, slower growth
in personal income, changes in consumer spending, changes in the
rate of housing turnover, the availability of consumer credit and
of mortgage financing, inflation or deflation of commodity prices,
and other factors that can negatively affect our customers, as well
as our ability to: (i) respond to adverse trends in the housing
industry, such as a demographic shift from single family to
multi-family housing, a reduced rate of growth in household
formation, and slower rates of growth in housing renovation and
repair activity, as well as uneven recovery in commercial building
activity; (ii) secure, develop, and otherwise implement new
technologies and processes necessary to realize the benefits of our
strategic initiatives focused on omni-channel sales and marketing
presence and enhance our efficiency; (iii) attract, train, and
retain highly-qualified associates; (iv) manage our business
effectively as we adapt our traditional operating model to meet the
changing expectations of our customers; (v) maintain, improve,
upgrade and protect our critical information systems from data
security breaches and other cyber threats; (vi) respond to
fluctuations in the prices and availability of services, supplies,
and products; (vii) respond to the growth and impact of
competition; (viii) address changes in existing or new laws or
regulations that affect consumer credit, employment/labor, trade,
product safety, transportation/logistics, energy costs, health
care, tax or environmental issues; (ix) positively and effectively
manage our public image and reputation and respond appropriately to
unanticipated failures to maintain a high level of product and
service quality that could result in a negative impact on customer
confidence and adversely affect sales; and (x) effectively manage
our relationships with selected suppliers of brand name products
and key vendors and service providers, including third party
installers. In addition, we could experience impairment losses if
either the actual results of our operating stores are not
consistent with the assumptions and judgments we have made in
estimating future cash flows and determining asset fair values, or
we are required to reduce the carrying amount of our investment in
certain unconsolidated entities that are accounted for under the
equity method. With respect to the acquisition of RONA inc.,
potential risks include the effect of the transaction on Lowe's and
RONA's strategic relationships, operating results and businesses
generally; our ability to integrate personnel, labor models,
financial, IT and others systems successfully; disruption of our
ongoing business and distraction of management; hiring additional
management and other critical personnel; increasing the scope
geographic diversity and complexity of our operations; significant
transaction costs or unknown liabilities; and failure to realize
the expected benefits of the transaction. For more information
about these and other risks and uncertainties that we are exposed
to, you should read the "Risk Factors" and "Management's Discussion
and Analysis of Financial Condition and Results of
Operations—Critical Accounting Policies and Estimates" included in
our most recent Annual Report on Form 10-K filed with the U.S.
Securities and Exchange Commission (the "SEC") and the description
of material changes thereto, if any, included in our Quarterly
Reports on Form 10-Q or subsequent filings with the SEC.
The forward-looking statements contained in this news release
are expressly qualified in their entirety by the foregoing
cautionary statements. The foregoing list of important factors that
may affect future results is not exhaustive. When relying on
forward-looking statements to make decisions, investors and others
should carefully consider the foregoing factors and other
uncertainties and potential events. All such forward-looking
statements are based upon data available as of the date of this
release or other specified date and speak only as of such date. All
subsequent written and oral forward-looking statements attributable
to us or any person acting on our behalf about any of the matters
covered in this release are qualified by these cautionary
statements and in the "Risk Factors" included in our most recent
Annual Report on Form 10-K and the description of material changes
thereto, if any, included in our Quarterly Reports on Form 10-Q or
subsequent filings with the SEC. We expressly disclaim any
obligation to update or revise any forward-looking statement,
whether as a result of new information, change in circumstances,
future events or otherwise, except as may be required by law.
Lowe's Companies, Inc.
Lowe's Companies, Inc. (NYSE: LOW) is a FORTUNE® 50 home
improvement company serving more than 17 million customers a week
in the United States, Canada and Mexico. With fiscal year 2015
sales of $59.1 billion, Lowe's and
its related businesses operate or service more than 2,355 home
improvement and hardware stores and employ over 285,000 employees.
Founded in 1946 and based in Mooresville,
N.C., Lowe's supports the communities it serves through
programs that focus on K-12 public education and community
improvement projects. For more information, visit Lowes.com.
Lowe's Companies,
Inc.
|
Consolidated
Statements of Current and Retained Earnings
(Unaudited)
|
In Millions, Except
Per Share and Percentage Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
October 28,
2016
|
|
|
October 30,
2015
|
|
|
October 28,
2016
|
|
|
October 30,
2015
|
Current
Earnings
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
Net
sales
|
$
|
15,739
|
100.00
|
|
$
|
14,360
|
100.00
|
|
$
|
49,233
|
100.00
|
|
$
|
45,838
|
100.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
10,332
|
65.65
|
|
|
9,370
|
65.25
|
|
|
32,201
|
65.41
|
|
|
29,856
|
65.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
5,407
|
34.35
|
|
|
4,990
|
34.75
|
|
|
17,032
|
34.59
|
|
|
15,982
|
34.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
4,090
|
25.98
|
|
|
3,287
|
22.89
|
|
|
11,354
|
23.05
|
|
|
10,334
|
22.55
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
378
|
2.40
|
|
|
375
|
2.61
|
|
|
1,101
|
2.24
|
|
|
1,115
|
2.43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest -
net
|
|
163
|
1.04
|
|
|
141
|
0.98
|
|
|
486
|
0.99
|
|
|
409
|
0.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
4,631
|
29.42
|
|
|
3,803
|
26.48
|
|
|
12,941
|
26.28
|
|
|
11,858
|
25.87
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
earnings
|
|
776
|
4.93
|
|
|
1,187
|
8.27
|
|
|
4,091
|
8.31
|
|
|
4,124
|
9.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
397
|
2.52
|
|
|
451
|
3.14
|
|
|
1,661
|
3.37
|
|
|
1,589
|
3.47
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
$
|
379
|
2.41
|
|
$
|
736
|
5.13
|
|
$
|
2,430
|
4.94
|
|
$
|
2,535
|
5.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - basic
|
|
873
|
|
|
|
918
|
|
|
|
884
|
|
|
|
933
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
common share (1)
|
$
|
0.43
|
|
|
$
|
0.80
|
|
|
$
|
2.74
|
|
|
$
|
2.70
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding - diluted
|
|
874
|
|
|
|
921
|
|
|
|
886
|
|
|
|
935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share (1)
|
$
|
0.43
|
|
|
$
|
0.80
|
|
|
$
|
2.73
|
|
|
$
|
2.70
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per
share
|
$
|
0.35
|
|
|
$
|
0.28
|
|
|
$
|
0.98
|
|
|
$
|
0.79
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retained
Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning
of period
|
$
|
6,839
|
|
|
$
|
8,533
|
|
|
$
|
7,593
|
|
|
$
|
9,591
|
|
Net earnings
attributable to Lowe's Companies, Inc.
|
|
378
|
|
|
|
736
|
|
|
|
2,428
|
|
|
|
2,535
|
|
Cash
dividends
|
|
(306)
|
|
|
|
(257)
|
|
|
|
(865)
|
|
|
|
(736)
|
|
Share
repurchases
|
|
(535)
|
|
|
|
(714)
|
|
|
|
(2,780)
|
|
|
|
(3,092)
|
|
Balance at end of
period
|
$
|
6,376
|
|
|
$
|
8,298
|
|
|
$
|
6,376
|
|
|
$
|
8,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Under the two-class
method, earnings per share is calculated using net earnings
allocable to common shares, which is derived by reducing net
earnings by the earnings allocable to participating
securities. Net earnings allocable to common shares used in
the basic and diluted earnings per share calculation were $376
million for the three months ended October 28, 2016 and $733
million for the three months ended October 30, 2015. Net
earnings allocable to common shares used in the basic and diluted
earnings per share calculation were $2,419 million for the nine
months ended October 28, 2016 and $2,523 million for the nine
months ended October 30, 2015.
|
Lowe's Companies,
Inc.
|
Consolidated
Statements of Comprehensive Income (Unaudited)
|
In Millions, Except
Percentage Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
|
|
October 28,
2016
|
|
|
October 30,
2015
|
|
|
October 28,
2016
|
|
|
October 30,
2015
|
|
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
Net
earnings
|
$
|
379
|
2.41
|
|
$
|
736
|
5.13
|
|
$
|
2,430
|
4.94
|
|
$
|
2,535
|
5.53
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments - net of tax
|
|
152
|
0.97
|
|
|
(69)
|
(0.48)
|
|
|
179
|
0.36
|
|
|
(275)
|
(0.60)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income/(loss)
|
|
152
|
0.97
|
|
|
(69)
|
(0.48)
|
|
|
179
|
0.36
|
|
|
(275)
|
(0.60)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
$
|
531
|
3.38
|
|
$
|
667
|
4.65
|
|
$
|
2,609
|
5.30
|
|
$
|
2,260
|
4.93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated
Balance Sheets
|
In Millions, Except
Par Value Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
October 28,
2016
|
|
|
October 30,
2015
|
|
|
January 29,
2016
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents
|
|
$
|
960
|
|
$
|
1,227
|
|
$
|
405
|
|
Short-term investments
|
|
|
123
|
|
|
158
|
|
|
307
|
|
Merchandise inventory - net
|
|
|
10,990
|
|
|
10,434
|
|
|
9,458
|
|
Other
current assets
|
|
|
655
|
|
|
321
|
|
|
391
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
|
12,728
|
|
|
12,140
|
|
|
10,561
|
|
|
|
|
|
|
|
|
|
|
|
|
Property, less accumulated depreciation
|
|
|
20,037
|
|
|
19,655
|
|
|
19,577
|
|
Long-term investments
|
|
|
436
|
|
|
382
|
|
|
222
|
|
Deferred
income taxes - net
|
|
|
331
|
|
|
295
|
|
|
241
|
|
Goodwill
|
|
|
1,034
|
|
|
154
|
|
|
154
|
|
Other
assets
|
|
|
804
|
|
|
1,018
|
|
|
511
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
35,370
|
|
$
|
33,644
|
|
$
|
31,266
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
Short-term borrowings
|
|
$
|
-
|
|
$
|
-
|
|
$
|
43
|
|
Current
maturities of long-term debt
|
|
|
800
|
|
|
1,058
|
|
|
1,061
|
|
Accounts
payable
|
|
|
7,836
|
|
|
7,338
|
|
|
5,633
|
|
Accrued
compensation and employee benefits
|
|
|
704
|
|
|
685
|
|
|
820
|
|
Deferred
revenue
|
|
|
1,258
|
|
|
1,084
|
|
|
1,078
|
|
Other
current liabilities
|
|
|
2,035
|
|
|
1,997
|
|
|
1,857
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
|
12,633
|
|
|
12,162
|
|
|
10,492
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, excluding current maturities
|
|
|
14,395
|
|
|
11,530
|
|
|
11,545
|
|
Deferred
revenue - extended protection plans
|
|
|
745
|
|
|
731
|
|
|
729
|
|
Other
liabilities
|
|
|
889
|
|
|
843
|
|
|
846
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
28,662
|
|
|
25,266
|
|
|
23,612
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
|
|
Preferred stock - $5 par value, none issued
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Common
stock - $0.50 par value;
|
|
|
|
|
|
|
|
|
|
|
Shares issued and outstanding
|
|
|
|
|
|
|
|
|
|
|
October 28, 2016
|
873
|
|
|
|
|
|
|
|
|
|
October 30, 2015
|
917
|
|
|
|
|
|
|
|
|
|
January 29, 2016
|
910
|
|
437
|
|
|
459
|
|
|
455
|
|
Capital
in excess of par value
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Retained
earnings
|
|
|
6,376
|
|
|
8,298
|
|
|
7,593
|
|
Accumulated other comprehensive loss
|
|
|
(214)
|
|
|
(379)
|
|
|
(394)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Lowe's Companies, Inc. shareholders' equity
|
|
|
6,599
|
|
|
8,378
|
|
|
7,654
|
|
Noncontrolling interest
|
|
|
109
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
equity
|
|
|
6,708
|
|
|
8,378
|
|
|
7,654
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and equity
|
|
$
|
35,370
|
|
$
|
33,644
|
|
$
|
31,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Consolidated
Statements of Cash Flows (Unaudited)
|
In
Millions
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
|
October 28,
2016
|
|
October 30,
2015
|
Cash flows from
operating activities:
|
|
|
|
|
Net
earnings
|
|
$
2,430
|
|
$
2,535
|
Adjustments to
reconcile net earnings to net cash provided by
|
|
|
|
|
operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
1,190
|
|
1,192
|
Deferred income
taxes
|
|
(72)
|
|
(140)
|
Loss on property and
other assets - net
|
|
130
|
|
19
|
Loss on cost method
and equity method investments
|
|
300
|
|
46
|
Share-based payment
expense
|
|
71
|
|
84
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Merchandise inventory
- net
|
|
(718)
|
|
(1,536)
|
Other operating
assets
|
|
32
|
|
38
|
Accounts
payable
|
|
1,859
|
|
2,218
|
Other operating
liabilities
|
|
47
|
|
90
|
Net cash provided
by operating activities
|
|
5,269
|
|
4,546
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Purchases of
investments
|
|
(1,018)
|
|
(650)
|
Proceeds from
sale/maturity of investments
|
|
987
|
|
588
|
Capital
expenditures
|
|
(820)
|
|
(844)
|
Contributions to
equity method investments - net
|
|
-
|
|
(106)
|
Proceeds from sale of
property and other long-term assets
|
|
28
|
|
51
|
Purchases of
derivative instruments
|
|
(103)
|
|
-
|
Proceeds from
settlement of derivative instruments
|
|
179
|
|
-
|
Acquisition of
business - net
|
|
(2,284)
|
|
-
|
Other -
net
|
|
(21)
|
|
(25)
|
Net cash used in
investing activities
|
|
(3,052)
|
|
(986)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Net change in
short-term borrowings
|
|
(44)
|
|
-
|
Net proceeds from
issuance of long-term debt
|
|
3,267
|
|
1,718
|
Repayment of
long-term debt
|
|
(1,146)
|
|
(541)
|
Proceeds from
issuance of common stock under
share-based payment plans
|
|
88
|
|
69
|
Cash dividend
payments
|
|
(815)
|
|
(700)
|
Repurchase of common
stock
|
|
(3,054)
|
|
(3,382)
|
Other -
net
|
|
48
|
|
46
|
Net cash used in
financing activities
|
|
(1,656)
|
|
(2,790)
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(6)
|
|
(9)
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
555
|
|
761
|
Cash and cash
equivalents, beginning of period
|
|
405
|
|
466
|
Cash and cash
equivalents, end of period
|
|
$
960
|
|
$
1,227
|
|
|
|
|
|
|
|
|
|
|
Lowe's Companies,
Inc.
|
Non-GAAP Financial
Measures Reconciliation
|
|
To provide additional
transparency, we have presented non-GAAP financial measures of
adjusted net earnings and adjusted diluted earnings per common
share to exclude the impact of certain non-cash charges in the
third quarter as described above (3Q2016 non-cash charges), as well
as the net gain on the settlement of a foreign currency hedge
entered into in advance of the company's acquisition of RONA in the
first half of 2016. We believe these non-GAAP financial measures
provide useful insight for analysts and investors in evaluating
what management considers the Company's core financial
performance.
|
|
Adjusted net earnings
and adjusted diluted earnings per common share should not be
considered alternatives to, or more meaningful indicators of, the
company's net earnings and diluted earnings per common share as
prepared in accordance with GAAP. The Company's methods of
determining these non-GAAP financial measures may differ from the
methods used by other companies for these or similar non-GAAP
financial measures. Accordingly, these non-GAAP measures may not be
comparable to the measures used by other companies.
|
|
Detailed
reconciliations between the Company's GAAP and non-GAAP financial
results are shown below and available on the Company's website at
www.lowes.com/investor.
|
|
|
|
|
Three months
ended
|
|
|
Nine months
ended
|
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
|
|
|
October 28,
2016
|
|
|
October 28,
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
In Millions, Except
Per Share and Percentage Data
|
|
Amount
|
%
Sales
|
|
|
Amount
|
%
Sales
|
|
Net earnings, as
reported
|
|
|
$
|
379
|
2.41%
|
|
$
|
2,430
|
4.94%
|
|
|
|
|
|
|
|
|
|
|
|
|
3Q2016 non-cash
charges
|
|
|
|
462
|
2.94%
|
|
|
462
|
0.93%
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain on foreign
currency hedge
|
|
|
|
-
|
-
|
|
|
(76)
|
-0.15%
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
|
|
(66)
|
-0.42%
|
|
|
(36)
|
-0.07%
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
earnings
|
|
|
$
|
775
|
4.93%
|
|
$
|
2,780
|
5.65%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per common share, as reported
|
|
|
$
|
0.43
|
|
|
$
|
2.73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3Q2016 non-cash
charges
|
|
|
|
0.53
|
|
|
|
0.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain on foreign
currency hedge
|
|
|
|
-
|
|
|
|
(0.08)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
|
|
|
(0.08)
|
|
|
|
(0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted diluted
earnings per common share
|
|
|
$
|
0.88
|
|
|
$
|
3.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Logo -
http://photos.prnewswire.com/prnh/20131007/MM93272LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lowes-reports-third-quarter-sales-and-earnings-results-300363813.html
SOURCE Lowe's Companies, Inc.