Home Improvement Stores See Sales Declines
Earnings were down in Q309 at the country’s two largest home improvement chains, The Home Depot (HD) and Lowe’s (LOW) as homeowners and renters alike show reluctance to begin improvement projects amid continued financial stress and increasing joblessness. Home Depot, the larger of the two chains, said it posted net earnings of $689m, or $0.41 per share, down 8% from $756m in Q308. Total sales at the 2,242-location store were down 8% year-over-year, and comparable store sales were down 6.9%. “There is still a great deal of pressure in the housing and home improvement markets, though there are some positive signs of stabilization," said Home Depot chairman and CEO Frank Blake. “Our business continues to perform well in a difficult environment.” Lowe’s reported net earnings of $344m, down 29.5% from $488m in Q308. Sales were down 3% from Q308 and comparable store sales declined 7.5% in the quarter. Lowe’s currently operates 1,699 stores, opening 12 new locations and closing one during the quarter. “The broad-based pressures of the macro environment are clearly evident in our sales as consumers continue to delay large purchases until they feel better about the economic outlook,” said Lowe’s chairman and CEO Robert Niblock. “While consumer spending remained weak, we were pleased with our sequential improvement in comparable store sales from the second quarter and continued evidence of solid market share gains.” Home Depot said it expects annual sales will be done 9%, while Lowe’s projects a 2% to 3% decline for the year. Write to Austin Kilgore.