Core-focused Lowe's to exit Mexico
"Our top priority in the third quarter was positioning Lowe's for long-term success by identifying underperforming or non-core businesses and stores for divestiture," commented Marvin R. Ellison, Lowe's president and CEO. "With our strategic reassessment substantially completed, we can now intensify our focus on the core retail business.
Meanwhile, sales for the third quarter increased 3.8% to $17.4 billion over the third quarter of 2017, and comparable sales increased 1.5%. Comparable sales for the U.S. home improvement business increased 2.0% for the third quarter.
Net earnings declined to $629 million, compared to $872 million in the same quarter last year. Part of that decline stems from $280 million in pre-tax charges recognized in the third quarter, including costs related to the store closings.
Ellison pledged a commitment to turning more store visits into sales, as the conversion rate was described as a pain point in the earnings release.
"During the quarter, the favorable macroeconomic environment, combined with great values, drove traffic to our stores and website," said Ellison. "However, continued challenges with inventory out of stocks, poor reset execution, and assortment concerns in certain categories pressured our ability to turn those visits into transactions," Ellison added. "Rather than chase short-term solutions to these problems, we are redesigning processes and systems to deliver sustainable improvement, and expect to see positive trends as we enter 2019.
"Our transformation will take time, but we have assembled an experienced team and developed a comprehensive plan to make steady progress," Ellison concluded. "I would like to thank our associates for their hard work and dedication to serving customers."
As of Nov. 2, 2018, Lowe's operated 2,133 stores, including those in Mexico.