“Lowe’s Q2 Comp Sales +4.4%” “Lowe’s reported net earnings of $1.04 billion for the quarter ended August 1, 2014, a 10.4 percent increase over the same period a year ago…Fiscal Year 2014 outlook: total sales are expected to increase approximately 4.5 percent, comparable sales are expected to increase approximately 3.5 percent, expects to open approximately 10 home improvement and 5 hardware stores.” Read the release
CNBC’s Headline: “Lowe’s profit tops estimates; trims sales guidance” “Lowe’s delivered second-quarter earnings that topped Wall Street’s expectations, but the retailer trimmed its outlook for full-year sales growth. Lowe’s shares sank in premarket trading following the report.” Read more
Lowe’s Q2 Earnings Conference Call Today at 9am ET Webcast
“Target’s new CEO will speak during earnings conference call Wednesday” by Nick Halter at Minn./St. Paul Bus. Journal. “CEOs typically lead earnings calls. A spokesman said Chief Financial Officer John Mulligan and Chief Merchandising and Supply Chain Officer Kathee Tesija will lead the call, but Cornell will also speak.” Read more
Target’s Q2 Earnings Conference Call Today at 9:30am CST Webcast
“Walmart Launches ‘Price First’ Private Label Line Nationally” by Kim Souza at The City Wire. “Price First is a new opening price point product line that the retail giant has tested in selected markets since the fall of 2013. Products include pasta, peanut butter, baking mixes, mustard and other condiments totaling about 50 items including paper and other consumables. Wal-Mart is nationally debuting the new private-label product line in more than 2,500 stores over the next few months, according to Danit Marquardt, Wal-Mart corporate spokeswoman.” Read more
***A message from Relax Sacks – Get Ready For the Most Comfortable Chair On the Planet! Consumers love the comfort of our ‘big and fun’ bean bag chairs (up to 7.5 feet in size!). Incredibly soft micro-suede covers and uniquely comfortable shredded foam filling make the Relax Sacks experience one your customers won’t want to miss! Great for living rooms, basements, kids rooms, dorm rooms, etc. Bring some fun and excitement to your stores and drive impulse sales in the process. www.relaxsacks.com. Email email@example.com for more information.
“Dick’s: PGA pros not needed to sell golf merchandise” by Tim Schooley at Pittsburgh Bus. Times. “We’ve got very good people who are there who can still help people,” said (CEO Ed) Stack when asked about how the lack of golf pros in the store could impact sales. “We don’t think it’s going to have any impact on the business.” Read more
“Icahn slams Family Dollar for ignoring Dollar General” by G. Chambers Williams III at The Tennessean. “Even as cynical as I am about the dysfunction of so many boards, I find it hard to believe that before agreeing to a $305 million breakup fee to Dollar Tree (which was obviously designed to chill other bidders), Family Dollar wouldn’t first be absolutely sure Dollar General wasn’t interested in bidding,” Icahn said in an online post. “Could the fact that Family Dollar’s CEO, Howard Levine, has a future role in a Dollar Tree/Family Dollar merger have anything to do with it?” Icahn asked.” Read more
“Icahn Suits Up for War with Family Dollar Management” by Charlie Gasparino at Fox Business. “The activist investor described Levine as a child of privilege who either doesn’t understand or doesn’t care about the rights of shareholders. “Listen, his father started the company, and he thinks it’s his,” Icahn said in a telephone interview. “But it isn’t and he doesn’t know what he’s doing.” Read more
“Macy’s to pay $650,000 for racial profiling at flagship store in Manhattan” by Michael Virtanen at AP via SF Gate. “The agreement cites Macy’s data from October 2012 through October 2013 showing employees apprehended and detained 1,947 individuals at the Herald Square store. Meanwhile, about 6,000 people were detained at stores statewide.” Read more
“GameStop CEO undergoes surgery for brain tumor” at Reuters via CNBC. “Chief Executive Paul Raines underwent an unexpected surgery last week for a small cancerous brain tumor. Raines, who will be undergoing chemotherapy, will restrict his travel during the expected six week of treatment, the company said in a regulatory filing on Tuesday.” Read more
“Staples Q2 Comp Sales Fall 5.8%” by Michael Calia at WSJ. “Sales through Staples.com rose 8%…The company’s commercial operations in North America posted a 2.6% increase in sales to nearly $2 billion.” Read more
“Sears Canada Q2 Comp Sales Fall 6.8%” via Yahoo. Read the release
“PetSmart to Explore Sale” by Soyoung Kim at Reuters via Chicago Tribune. “There is no guarantee the review will lead to a deal and PetSmart could still determine that it would be better off on its own, people familiar with the matter told Reuters.” Read more
Highlights from Home Depot’s Q2 Earnings Call
Every region positively comped.
Our Mexican business positively comped for the quarter, making it 43 quarters in a row of positive comps.
We could actually see the divot in sales when Mexico was playing in World Cup matches, but they still performed very well.
Canadian business continues to perform well with positive comps for the 11th consecutive quarter.
Our dot-com business had sales growth of over 38%.
Departments that outperformed the company’s average comp: tools, millwork, outdoor garden electrical, windows, concrete, insulation, pressure treated wood, studs, fasteners, pipe and fitting, gypsum, kitchens.vanities, decorative lighting, fixtures and hard surface flooring led by laminate, tile and hardwood.
Appliances also had another quarter of outperformance, posting double-digit comps.
Baths, décor, plumbing, hardware, paint, building materials, indoor garden, flooring, lighting, and lumber were at or below the company average, all at mid-single digit comps.
Appliance parts, HVAC, hand tools, power tool accessories, water heaters and light bulbs all had double-digit comps.
Total company transactions grew by 4.1% for the quarter while comp ticket increased 1.7%.
Transactions for tickets under $50, representing approximately 20% of our U.S. sales, were up 3.1% for the second quarter.
Transactions per tickets over $900, also representing approximately 20% of our U.S. sales, were up 8.4% in the second quarter.
Sales from our high spend pro customers, which we define as those who spend more than $10,000 a year with us, grew above the company average for the tenth quarter in a row.
Our new lightbulb reset that will expand our presence and holding capacity in the category. This reset will add 25 new SKUs to our assortment and provide for a better, more intuitive shopping experience for the customer.
The lowest comping department was north of 4% and the spread was pretty narrow.
Roughly about a third of our online transactions culminate in a store, and that is split across both consumer and pro.
Roughly about 4% of our total sales comes from our services businesses today.
We are reaffirming our sales growth guidance for the year of approximately 4.8% and comp sales growth of approximately 4.6%.
We expect a rate of comp growth for the back half of the year to be about 80 basis points higher than the rate of comp growth we experienced in the first half of the year.
Appliances: we have our expanded assortment in over 800 of our stores. We’re rolling to another 183 stores, and appliances contributed 50 basis points of our comp growth in the second quarter.
We might also just call out services because they had such a terrific quarter. They comped twice the company average, and the average ticket within our services business is $1,500.
Print will be less than 10% of our total advertising spend this year while digital is 36% and trending higher.
If we had either a 5% increase in our ticket or three more transactions per pro per year, it’s a $1.2 billion opportunity.
Dot-com sales made up 4.2% of our total sales at the end of the second quarter – that’s up 100 basis points from a penetration perspective year-on-year.
I would say buy online, ship to store is 100% incremental, and that in the second quarter was $144 million.
Eye-on-Retail is a daily tipsheet read by thousands of Retail Merchants/Executives every weekday morning. Eye-on-Retail is unique because it’s timely, smart and fun. It’s created bright and early every morning and delivered between 7-8 am CT. We love data, earnings reports, executive presentations and stories off the beaten path that get at what’s really happening in the world of retail. Contact us at firstname.lastname@example.org.