Lowe’s posts sales and earnings declines in Q1
The country’s second largest home center chain posted sales of $12.2 billion in its first quarter ended April 29. That’s down 1.6% as the one-two punch of bad weather and the weak economy took its toll.
The company’s earnings also declined — down 5.7% to $461 million. Comparable-store sales were down 3.3%.
"We delivered earnings per share within our guidance for the quarter, despite lower-than-expected sales,” commented Robert A. Niblock, Lowe’s chairman and CEO. “During the quarter, we faced ongoing economic pressures, unfavorable weather conditions and tough comparisons to last year’s government stimulus programs. While we are focused on competing effectively in the current environment, we are also working diligently on our commitment to deliver better customer experiences. We are building momentum in 2011 behind our transformation from a home improvement retailer to a home improvement company.”
Looking ahead to the second quarter, Lowe’s expects sales to increase about 4%, and it expects comparable-store sales to increase about 2%.
During the quarter, Lowe’s opened four stores, including one relocation, and closed one store that was damaged by a tornado. The company operates 1,751 stores in the United States, Canada and Mexico.
Is this less than $300 per
Is this less than $300K per store? I don't feel so bad today.
IHS Global forecast calls for patience
J. Scott Hazelton, senior principal and director of the construction services practice of IHS Global Insight, pointed to the positive and negative forces affecting the 2011 economy during a presentation in Las Vegas last week.
Hazelton addressed the Presidents Council Advisory Board during the National Hardware Show last week.
"Things are getting better, but you still need to be patient," Hazelton said.
The IHS forecast calls for 2011 housing starts to finish the year at about 610,000, up 3.9% from 586,900 in 2010.
On the positive side of the macroeconomic picture, Hazelton pointed to a strong growth in manufacturing, healing financial markets, corporations flush with cash, an improving labor market and stimulus from the tax package.
Pushing the economy in the negative direction, he said, are the following factors: consumers and businesses remain cautious, no housing recovery, rising commodity prices, Japan’s earthquake disrupting the automotive industry, state and local budget cuts, and federal fiscal tightening ahead.
The Home Improvement Presidents Council provides a forum for buyers and sellers to build relationships and exchange information through various programs at the senior management level worldwide.
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Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for May 13, 2011
*Western – regional species perimeter foundation; Southern – regional species slab construction.
Crow’s Market Recap — A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow’s Weekly Market Report.
LUMBER: Both producers and wholesalers reported another "quiet" week of sales activity in the SPF lumber market. U.S. prices out of eastern mills were soft. Volumes of Southern Pine 2×6 #2, the strongest dimension in that grade, were sometimes sold at higher prices, while modest discounting, at times, took place in wide widths. Demand was dull overall and a perception that production curtailments were not yet numerous enough prevailed. Pricing of Coastal species lumber was flat to lower, as mills sought to sell green Doug Fir with significant discounts. Prices were more stable on the dry side of production. Inland species lumber demand and supply seem finally to have reached equilibrium. Prices, which have fallen $40 to $55 dollars over the past several weeks, seem to be stabilizing. Ponderosa Pine Mldg&Btr 5/4 is holding at $1,350 with 6/4 at $1,400. Regular Shop users continue to find their supplies, with the open market getting little wood. Boards are "reasonably steady," according to one source. Yet another said that he has too little demand for his current position. Idaho White Pine producers report that both Utility and Standard are "strong," but Sterling is in short supply. Eastern White Pine producers report a market little changed from last week. Radiata Pine lumber prices are holding very firm in both 5/4 and 6/4. Wholesalers report that it remains difficult to find stock. Any increases in Western Red Cedar demand so far this spring have been mill-specific, with rarely any consensus among mills that demand is improving from week to week.
PANELS: Western Fir plywood buyers in the West purchased needs conservatively. Participation by customers in the Northeast was limited, although inquiry levels were decent. While $10 to $20 declines in Southern Pine rated sheathing were most common, prices of other items dropped as much, if not more. Wholesalers had difficulties moving contract volumes, and producers admitted to stacking even more production. OSB inventories have built at both mill level and in the field, giving producers no place to put production and distributors no more room to store stock. Canadian plywood producers have had varying needs, causing some to discount while others held firm. Today, the C$296 is still valid as a general reflection of mill-selling levels, although a wide range of prices is reported from the field. The conflict between increasing expenses and slack demand is catching up with producers of both particleboard and MDF. But with competition for every order being intense, talking price increases is a touchy matter.
Source: RISI’s Crow’s Weekly Market Report
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