Lowe's 2Q Profit Drops 7.9%

Mooresville, N.C. Lowe's Cos. Inc. reported a 7.9% decline in second-quarter profit on Monday as the company benefited from tight expense controls and the government stimulus package.

Lowe's earned $938 million in the three months ended Aug. 1, down from $1.02 billion in the year-ago period. It said sales increased 2.4% to $14.5 billion from $14.17 billion a year ago.

"Our sales results for the quarter, while better than our forecast, reflect the realities of the continuing macro-economic pressures on our industry," said Robert A. Niblock, chairman and CEO, in a statement.

Niblock added that Lowe's experienced "relative" strength in seasonal sales as homeowners restored lawns and did outdoor landscaping following the effects of last year's drought in much of the country. He also said the company benefited from the economic impact of the fiscal stimulus checks.

However, Niblock added that weakness in bigger ticket items continues, particularly in markets hurt most by the housing downturn.