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Lowe’s Provides Fiscal 2022 Financial Outlook

Lowe's Customer Service uniform 725 x 500
  • Accelerating Market Share Gains with DIY and Pro through Total Home Strategy
  • Board Increases Share Repurchase Authorization to $20 Billion
  • Company Plans Share Repurchases of Approximately $12 Billion in 2022

Lowe’s Companies, Inc. (NYSE: LOW) is hosting its 2022 Financial Outlook webcast today [15th December].

Today’s presentations include the company’s priorities for 2022 with a focus on its Total Home Strategy aimed at taking market share, driving productivity, and providing an integrated omni-channel shopping experience. Additionally, the company plans to review its 2022 financial outlook and capital allocation commitments.

“I am pleased to share our plans for 2022, including how we will drive further market share gains across DIY and Pro through our Total Home Strategy,” commented Marvin R. Ellison, Lowe’s chairman, president, and CEO. “We are confident in the long-term growth prospects for the Home Improvement market, and that we are making the right investments to continue winning with both our Pro and DIY customers. We also remain committed to driving sustainable shareholder value creation through a disciplined and highly effective capital allocation strategy.” 

“Next year we expect that our disciplined execution will drive productivity across the company, enabling us to deliver further operating margin expansion, robust cash flow generation and higher ROIC,” commented David M. Denton, Lowe’s executive vice president and CFO. “We look forward to increasing our long-term operating targets at our next Analyst & Investor Conference in December 2022, when we will provide the building blocks to our next operating margin milestone.”

Based on its confidence in the company’s continued growth trajectory and cash flow generation capabilities, the Board of Directors has authorized a new $13 billion common stock repurchase program. This new repurchase program has no expiration date and adds to the previous program’s balance, which was $7.3 billion as of December 14, 2021. The company now has total share repurchase authorization of approximately $20 billion. Lowe’s reiterates its outlook for operating results for Full Year 2021 as previously released and now provides its outlook on Return on Invested Capital (ROIC)1.

Full Year 2021 Outlook (comparisons to full year 2020)
• Total sales of approximately $95 billion, representing approximately 33% comparable sales growth on a two-year basis
• Gross margin rate of 33.10%, up slightly compared to prior year
• Operating income as a percentage of sales (operating margin) of 12.4%
• Total share repurchases of approximately $12 billion
• ROIC1 over 33%

Full Year 2022 Outlook - a 53-week Year (comparisons to full year 2021 outlook - a 52-week year)
• Total sales of $94 billion to $97 billion, including the 53rd week
• 53rd week expected to increase total sales by approximately $1.0 billion to $1.5 billion
• Comparable sales expected to range from a decline of 3% to flat
• Gross margin rate flat compared to prior year
• Depreciation and amortization of approximately $1.7 billion
• Operating income as a percentage of sales (operating margin) of 12.5% to 12.8%
• Interest expense of $1.0 to $1.1 billion
• Effective income tax rate of approximately 25%
• Diluted earnings per share of $12.25 to $13.00
• Total share repurchases of approximately $12 billion
• ROIC1 of approximately 35%

For Full Year 2022, the company expects capital expenditures of approximately $2 billion.

Source : Lowe's 

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16 December 2021

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