(AOF) – The number two American DIY company Lowe’s has unveiled better than expected results and confirmed its annual objectives. In the second quarter, which ended at the end of July, net profit reached 2.7 billion dollars, or 4.56 dollars per share against respectively 3 billion and 4.67 dollars, a year earlier. Earnings per share beat consensus by 7 cents. Sales fell 9.2% to $24.96 billion, coming in slightly below expectations: $25 billion.
They fell by 1.6% on a like-for-like basis, a drop below expectations: -2.4%.
The Home Depot competitor reaffirmed its annual earnings per share targets of between $13.20 and $13.60 on revenue of between $87 billion and $89 billion, down 2% to 4% in data comparable.
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Concerns remain
According to the Federation of Specialized Trade, Procos, in October 2022, activity fell by 1.5% over one year. Nevertheless, the beauty and health (+ 5.2%) and specialized food (+ 3.5%) activity is dynamic compared to October 2021. The frequentation of the points of sale was very impacted by the problems of fuel and bad weather. Compared to October 2019, the pre-covid year, the drop in attendance is very sharp (-20.9% in October). Shopping centers and the outskirts are more impacted than city centers with a difference of four to five points.
Several reasons for concern exist for the future. The players are experiencing a very significant scissor effect given the increase in their operating costs while the evolution of demand is very uncertain. Very few brands can pass on the increase in their costs to their selling prices. The federation therefore asks, among other things, to limit the indexation of the Commercial Rent Index to + 3.5% for the rents of all companies in 2023. It also invokes an absolute urgency: to cap the price of energy for 2023 and retroact on the contracts already signed to prevent the rate of failures from accelerating.