Lowe's 2000 Annual Report Download - page 5

Lowe’s Companies, Inc.
3
When the economic climate changes, the world’s
best retailers look for opportunity. The marked eco-
nomic shift that occurred during the latter part of
2000 was one such time, and Lowe’s took the
opportunity to evaluate our business and sharpen
our vision for the future. While obstacles like the
slowing economy and severe lumber deflation kept
us from meeting all of our objectives for 2000,
Lowe’s did report record
sales and earnings during
these somewhat challeng-
ing economic times. Lowe’s
achieved sales of $18.8bil-
lion in 2000, an 18 percent
increase over 1999; net
income exceeded $800
million, showing a 20 per-
cent improvement over
1999; and earnings per
share improved from $1.75
to $2.11, a 21% increase.
Pursuing our tack of
carefully planned growth,
Lowe’s opened 100 new
stores during 2000. We
increased our presence in the top 25 U. S.
Metropolitan Statistical Areas (MSAs), significantly
increasing the number of stores in these crucial areas
to 18 percent of our total. The top 25 MSAs repre-
sent approximately one-half of the nation’s Do-It-
Yourself (DIY) market potential and therefore repre-
sent tremendous opportunity for future growth as
Lowe’s continues expanding into these areas.
During 2000, we converted all 41 former Eagle
locations to Lowe’s Home Improvement Ware-
houses. This enormous endeavor was completed in
the third quarter of 2000, thanks in large part to the
dedication and assistance of our employees at these
locations and throughout Lowesland, and our vendor
partners. We are now aggressively marketing the
Lowe’s story of superior customer service, quality
products and exclusive brands backed by Lowe’s
guaranteed low prices and complete customer satis-
faction. We expect to continue experiencing financial
improvement from these
“new” Lowe’s stores.
Looking to the future, we
see a fast growing and highly
fragmented $400 billion
home improvement indus-
try only getting better. The
home improvement market
is expected to grow over
four percent annually for
the next four years, as Baby
Boomers trade up, remodel,
and generally improve their
homes, and X’ers buy and
move into their first homes
and prepare for the family to
follow. Even more promis-
ing, today the home improvement industry is domi-
nated by two industry leaders. Lowe’s, and our pri-
mary competitor, as the top two players, control less
than 20 percent market share. The balance of the
industry’s sales is highly fragmented, creating contin-
ued opportunity for market share gains.
Another important and positive aspect of the
home improvement industry is the resiliency it
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To Our Shareholders:
robert l. tillman
chairman of the board, president
and chief executive officer