Advertise with

The US-based home-improvement chain strives to compete with rivals including Home Depot.
The US-based home-improvement chain strives to compete with rivals including Home Depot.

Lowe’s to ditch Mexico stores in further streamlining


By Aishwarya Venugopal - Nov 21st 2018, 11:23

Lowe’s stated it was looking to shed its retail operations in Mexico and certain noncore US businesses as the country’s second-biggest home improvement chain strives to compete with rivals including Home Depot.

The share price of the company based in Mooresville, North Carolina, fell 5.3% to $86.50 in premarket trading after Lowe’s also reported a smaller-than-expected rise in same-store sales.

Under Marvin Ellison, Lowe’s new CEO, the company has been streamlining its business by shutting underperforming stores and cutting back on slow-moving inventory.

The company has perennially lagged Home Depot in same-store sales, despite having about the same number of stores.

Lowe’s said it was looking at all options for its chain of 13 stores in Mexico and that it was “exiting” its US contracting services business Alacrity Renovation Services and security and smart home app Iris Smart Home.

Earlier in November, Lowe’s announced the closure of 51 underperforming stores in the US and Canada, which followed the shutdown of 99 Orchard Supply stores in California.

“With our strategic reassessment substantially completed, we can now intensify our focus on the core retail business,” said Ellison. "Our transformation will take time.”

Lowe’s net earnings fell to $629m, or 78c per share, in the third quarter ended November 2 from $872m, or $1.05 per share, a year earlier.

The company’s results included $280m in pretax charges.

Sales at stores open for more than a year rose 1.5% in the third quarter, versus expectations of a 2.93% increase, according to IBES data from Refinitiv.

Ellison blamed the assortment of merchandise at stores and the inability to restock shelves with the right kind of inventory for poor sales.

The company cut its forecast for full-year sales growth to about 4% from 4.5% and says it expects comparable sales to rise about 2.5%, compared with 3% estimated previously.

Excluding certain items, Lowe’s earned $1.04 per share, beating estimates of 98c. While, net sales rose nearly 4% to $17.42bn, edging past expectations of $17.36bn.
Business Live 

Read more about: us | trading | sales | retailer | retail | mexico | lowe’s | growth

Related News

Shoprite targets rivers on World Cleanup Day
19/09/2019 - 14:59
The Shoprite Group has partnered with the South African Department of Water and Sanitation to host river cleanups on World Cleanup Day (21 September 2019) and everyone’s invited to join in.

Zara launches online store in South Africa
19/09/2019 - 11:58
Zara has launched its online sales in SA through its dedicated website This marks an important milestone in the expansion of Zara’s integrated store and online platform into markets where it already has a store presence.

Pick n Pay launches collectable Rugby Super Cards
19/09/2019 - 11:28
Local sports fans can once again feel part of the upcoming rugby tournament thanks to the launch of Pick n Pay’s new Rugby Super Cards.

The V&A Waterfront’s Victoria Wharf is SA’s greenest shopping centre
19/09/2019 - 09:13
The V&A Waterfront’s far-reaching waste management and recycling practices has earned the property a prestigious Green Buildings Council of SA (GBCSA) 5 Star Green Star Existing Building Performance v1 certification (EBP v1) for the popular Victoria Wharf Shopping Centre – the highest rating for any existing shopping centre in South Africa.

Ackermans launches ‘Moms4Moms’ educational platform to give mothers a helping hand
16/09/2019 - 14:03
According to a 2017 Statistic South Africa report, 61% of South African children are raised by only their mothers. This reveals that the majority of South African women have to navigate single-parenthood, as well as being the sole provider for their families.