MOORESVILLE, N.C.–Buoyed by improved margins and reduced expenses, Lowe’s enjoyed a 76 percent increase in net income in its third quarter, to $396 million.
Selling, general and administrative expenses in the quarter, which ended on Nov. 2, were cut by 6.5 percent in dollars and 224 basis points as a percentage of sales, to 25 percent. Gross margin rose 26 basis points to 34.3 percent. The home-improvement retailer’s bottom line also benefited from the absence of charges taken in last year’s third quarter, for store closings, long-lived asset impairments and discontinued projects.
Net sales edged up 1.9 percent to $12.1 billion, including a gain of 1.8 percent in same-store sales. Robert Niblock, Lowe’s chairman, president and CEO, said, “Our level of execution is improving and we delivered solid results in the third quarter.”
Based on the third-quarter results, Lowe’s has projected that total sales for the entire fiscal year will be flat compared with last year, with a same-store sales increase of about 1 percent.