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LOWE’S 2007 ANNUAL REPORT |45
Lowe’s Companies, Inc.
QUARTERLY REVIEW OF PERFORMANCE (Unaudited)
Earnings Statements
(In millions, except per share data) Fiscal 2007 Fiscal 2006
Quarter Ended Fourth Third Second First Fourth Third Second First
Net sales $10,379 $11,565 $14,167 $12,172 $10,406 $11,211 $13,389 $11,921
Gross margin 3,620 3,964 4,883 4,259 3,687 3,865 4,478 4,169
Expenses:
SG&A 2,489 2,503 2,839 2,685 2,335 2,320 2,617 2,467
Store opening costs 61 41 26 12 49 44 28 25
Depreciation 370 340 332 323 308 297 283 274
Interest – net 47 50 50 47 43 45 30 35
Total expenses 2,967 2,934 3,247 3,067 2,735 2,706 2,958 2,801
Pre-tax earnings 653 1,030 1,636 1,192 952 1,159 1,520 1,368
Income tax provision 245 387 617 453 339 443 585 527
Net earnings 408 643 1,019 739 613 716 935 841
Basic earnings per share 0.28 0.44 0.68 0.49 0.40 0.47 0.61 0.54
Diluted earnings per share $ 0.28 $ 0.43 $ 0.67 $ 0.48 $ 0.40 $ 0.46 $ 0.60 $ 0.53
Earnings Statement Changes
(Changes from same quarter previous year, to nearest tenth percent)
Fiscal 2007 Fiscal 2006
Quarter Ended Fourth Third Second First Fourth* Third Second First
Net sales (0.3)% 3.2% 5.8% 2.1% (3.7)% 5.8% 12.2% 20.3%
Gross margin (1.8) 2.6 9.1 2.2 (2.6) 8.0 11.2 22.7
Expenses:
SG&A 6.6 7.8 8.5 8.9 1.4 4.9 10.7 15.5
Store opening costs 24.3 (6.4) (5.7) (52.1) (14.0) 25.7 12.0 –
Depreciation 20.0 14.4 17.6 17.8 18.0 20.7 19.9 15.6
Interest – net 7.7 12.5 65.4 33.3 19.4 25.0 (23.1) (25.5)
Total expenses 8.4 8.4 9.8 9.5 2.9 7.0 11.1 14.6
Pre-tax earnings (31.3) (11.1) 7.6 (12.9) (15.6) 10.3 11.4 43.5
Income tax provision (27.6) (12.4) 5.3 (13.9) (22.1) 9.4 11.4 43.6
Net earnings (33.4) (10.3) 9.0 (12.2) (11.5) 10.8 11.4 43.5
Basic earnings per share (30.0) (6.4) 11.5 (9.3) (9.1) 14.6 13.0 42.1
Diluted earnings per share (30.0)% (6.5)% 11.7% (9.4)% (7.0)% 15.0% 15.4% 43.2%
*Change is calculated from the fourth quarter of fiscal 2005, which contained an additional week.
Earnings Statement Percentages
(Percent of sales to nearest hundredth;
income tax is percent of pre-tax earnings)
Fiscal 2007 Fiscal 2006
Quarter Ended Fourth Third Second First Fourth Third Second First
Net sales 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Gross margin 34.88 34.27 34.47 34.99 35.44 34.47 33.44 34.97
Expenses:
SG&A 23.97 21.63 20.04 22.06 22.44 20.70 19.54 20.69
Store opening costs 0.59 0.36 0.18 0.10 0.47 0.39 0.21 0.21
Depreciation 3.57 2.94 2.35 2.65 2.97 2.65 2.11 2.30
Interest – net 0.45 0.43 0.35 0.39 0.42 0.40 0.23 0.30
Total expenses 28.58 25.36 22.92 25.20 26.30 24.14 22.09 23.50
Pre-tax earnings 6.30 8.91 11.55 9.79 9.14 10.33 11.35 11.47
Income tax provision 37.51 37.64 37.69 38.01 35.57 38.20 38.51 38.49
Net earnings 3.93% 5.56% 7.19% 6.07% 5.89% 6.39% 6.98% 7.06%