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Good morning, everyone, and welcome to Lowe's Companies second-quarter 2014 earnings conference call. This call is being recorded.
During this call management will be using certain non-GAAP financial measures. The supplemental reference slides include information about these measures and a reconciliation to the most directly comparable GAAP financial measures.
Statements made during this call will include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Management's expectations and opinions reflected in those statements are subject to risks and the Company can give no assurance that they will prove to be correct. Those risks are described in the Company's earnings release and in its filings with the Securities and Exchange with battery such as Husqvarna Automower AU-18C Battery, Husqvarna Automower AU-18V Battery, Husqvarna Automower 210C Battery, Husqvarna Automower 220 Battery, Husqvarna Automower 230ACX Battery, Husqvarna Automower 260ACX Battery, Husqvarna Automower G2 2004-2006 Battery, Husqvarna Automower SH Battery, Husqvarna Automower 540059601 Battery, iRobot Roomba 4905 WC Battery, iRobot Roomba APS 4905 Battery, iRobot Roomba Tenergy 11701 Battery Commission.
Hosting today's conference will be Mr. Robert Niblock, Chairman, President and Chief Executive Officer; Mr. Rick Damron, Chief Operating Officer; and Mr. Bob Hull, Chief Financial Officer. I will now turn the call over to Mr. Niblock for opening remarks. Please go ahead, sir.
Robert Niblock - Chairman, President & CEO
Good morning and thanks for your interest in Lowe's. We delivered solid results for the second quarter. Comparable sales were 4.4% with an increase in comp transactions of 3.1% and an increase in comp average ticket of 1.3%.
As expected, we recovered most of the outdoor product sales missed in the first quarter due to unfavorable weather conditions. But discretionary interior projects did not perform as well as expected. Outdoor product sales were strong with a roughly 6.5% comp for the quarter while indoor comps were roughly 3%.
All 14 regions had positive comps for the quarter; likewise, all 12 product categories had positive comps. We saw a particular strength in lawn and garden during the quarter and the outdoor living experience we discussed on our first-quarter earnings call drove success in patio furniture and accessories.
While seasonal categories were strong we also saw strength in millwork, paint and tools and hardware which were all above the Company average. And we saw solid performance in line with the Company average in fashion fixtures, flooring and lumber and building materials.
We continue to see strength in our ProServices business which outperformed the Company average during the quarter. And I am pleased to share that our team in Canada delivered double-digit comps in local currency for the fifth consecutive quarter.
We remain focused on improving our profitability even while investing in key capabilities to drive sales growth. For the quarter gross margin expanded 20 basis points and we effectively controlled expenses delivering 67 basis points of operating margin expansion and earnings per share of $1.04, an 18.2% increase over last year's second quarter.
Delivering on our commitment to return excess cash to shareholders in the quarter we repurchased $1.1 billion of stock and paid $183 million in dividends. As we look at the backdrop for the second half of 2014, economic forecasts suggest continued strength in the home improvement market as employment, income and consumer spending levels continue to improve. At the same time signals from the housing market appear mixed as home values have increased moderately while existing home sales in total have declined this year.
However, when distressed sales are omitted from the data, which we believe is a more appropriate indicator of the long-term health of our industry, existing home sales have seen a slight increase through the first half of the year revealing a more positive and sustainable trend. In light of the positive trajectory of these factors we believe home-improvement spending will continue to progress in tandem with strengthening job and income growth.
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