Mooresville, N.C. Lowe's Cos. announced Monday that its fourth-quarter profit rose a better-than-expected 27%, helped by cost cuts and a modest sales gain. The retailer said it expects sales to rise this year as the housing market and broader economy recover. But it forecast earnings for the prime spring quarter below analyst expectations.
Quarterly profit rose 27% to $205 million. Revenue edged up nearly 2% to $10.17 million. Same-store sales fell 1.4%. For the full year, profit fell 19% to $1.78 billion.
Lowe's also authorized a $5 billion share buyback program. It has no expiration date but the company said it expects to use the full amount over the next three years.
In a statement, Lowe’s CEO Robert A. Niblock said the company’s results suggest that "the worst of the economic cycle is likely behind us.” He noted that the "psychological impact" of falling home prices and job worries continue to weigh on consumers, but improving sales trends, including more purchases of higher-ticket items, are an "encouraging sign" consumers will begin to take on larger home-improvement projects.
Lowe’s said it expects sales to rise 1% to 3% in the first quarter, implying sales of $11.94 billion to $12.18 billion, while analysts expect revenue of $11.97 billion.