Lowe’s lags behind Home Depot as cold weather hits spring sales

City A.M. Reporter
LOWE’S reported a weaker-than-expected quarterly profit yesterday, hurt by colder-than-usual weather at the start of the spring selling season and strong competition from larger rival Home Depot.

The results contrasted sharply with those of Home Depot and signalled that Lowe’s, the world’s second-largest home improvement chain, was still struggling to narrow the performance gap with the industry leader.

Lowe’s sales fell 0.5 per cent to $13.09bn (£8.6bn) in the first quarter ended on 3 May, missing analysts’ average estimate of $13.45bn.

Sales at stores open at least a year dipped 0.7 per cent. It was the 16th straight quarter that Lowe’s posted weaker same-store sales than Home Depot.

“The spread between Home Depot and Lowe’s (same-store sales) expanded in the first quarter, something we had worried might happen,” said Janney Capital Markets analyst David Strasser.

Lowe’s, which was also slower than Home Depot to cut costs in the years after the housing collapse, said its first-quarter net earnings rose to $540m, or 49 cents a share, from $527m, or 43 cents a share, a year earlier.

Analysts on average expected a profit of 51 cents a share.