x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
For
the quarterly period ended August 4,
2006
|
Commission
file number 1-7898
|
LOWE'S COMPANIES,
INC.
|
(Exact
name of registrant as specified in its
charter)
|
NORTH
CAROLINA
|
56-0578072
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
1000
Lowe's Blvd., Mooresville, NC
|
28117
|
(Address
of principal executive offices)
|
(Zip
Code)
|
|
|
Registrant's
telephone number, including area code
|
(704)
758-1000
|
x
|
Yes
|
o
|
No
|
Large
accelerated filer x
|
Accelerated
filer o
|
Non-accelerated
filer o
|
o
|
Yes
|
x
|
No
|
CLASS
|
OUTSTANDING
AT SEPTEMBER 1, 2006
|
|
Common
Stock, $.50 par value
|
1,527,926,339
|
LOWE’S
COMPANIES, INC.
-
INDEX -
|
|||
PART I - Financial Information |
Page
No.
|
||
Item 1. | Financial Statements | ||
Consolidated Balance Sheets (Unaudited) - August 4, 2006, July 29, 2005, as restated, and February 3, 2006, as restated |
3
|
||
Consolidated Statements of Current and Retained Earnings (Unaudited) - Three and six months ended August 4, 2006 and July 29, 2005, as restated |
4
|
||
5
|
|||
6-15
|
|||
16
|
|||
Item 2. |
17-23
|
||
Item 3. |
23
|
||
Item 4. |
23
|
||
PART II - Other Information | |||
Item 1A. | Risk Factors |
24
|
|
Item 2. |
24
|
||
Item 4. |
24-25
|
||
Item 6. | Exhibits |
25
|
|
Signature |
26
|
||
Exhibit Index |
27
|
Lowe's
Companies, Inc.
|
|||||||||||||
Consolidated
Balance Sheets (Unaudited)
|
|||||||||||||
In
Millions, Except Par Value Data
|
|||||||||||||
|
|
July
29, 2005
|
February
3, 2006
|
||||||||||
|
|
August 4, 2006
|
As
Restated
|
As
Restated
|
|||||||||
Assets
|
|||||||||||||
Current
assets:
|
|||||||||||||
Cash and cash equivalents
|
$
|
316
|
$
|
987
|
$
|
423
|
|||||||
Short-term investments
|
456
|
432
|
453
|
||||||||||
Merchandise inventory - net
|
7,176
|
6,165
|
6,635
|
||||||||||
Deferred income taxes - net
|
165
|
121
|
155
|
||||||||||
Other current assets
|
215
|
113
|
122
|
||||||||||
Total current assets
|
8,328
|
7,818
|
7,788
|
||||||||||
Property, less accumulated depreciation
|
17,321
|
14,782
|
16,354
|
||||||||||
Long-term investments
|
200
|
190
|
294
|
||||||||||
Other assets
|
188
|
198
|
203
|
||||||||||
Total assets
|
$
|
26,037
|
$
|
22,988
|
$
|
24,639
|
|||||||
Liabilities
and shareholders' equity
|
|||||||||||||
Current liabilities:
|
|||||||||||||
Current maturities of long-term debt
|
$
|
32
|
$
|
632
|
$
|
32
|
|||||||
Accounts payable
|
3,629
|
2,987
|
2,832
|
||||||||||
Accrued salaries and wages
|
316
|
329
|
424
|
||||||||||
Self-insurance liabilities
|
653
|
546
|
571
|
||||||||||
Deferred revenue
|
826
|
694
|
709
|
||||||||||
Other current liabilities
|
1,206
|
1,002
|
1,264
|
||||||||||
Total current liabilities
|
6,662
|
6,190
|
5,832
|
||||||||||
Long-term debt, excluding current maturities
|
3,410
|
2,810
|
3,499
|
||||||||||
Deferred income taxes
|
711
|
691
|
735
|
||||||||||
Other long-term liabilities
|
334
|
252
|
277
|
||||||||||
Total liabilities
|
11,117
|
9,943
|
10,343
|
||||||||||
Shareholders' equity:
|
|||||||||||||
Preferred stock - $5 par value, none issued
|
-
|
-
|
-
|
||||||||||
Common stock - $.50 par value;
|
|||||||||||||
Shares issued and outstanding
|
|||||||||||||
August 4, 2006
|
1,538
|
||||||||||||
July 29, 2005
|
1,560
|
||||||||||||
February 3, 2006
|
1,568
|
769
|
780
|
784
|
|||||||||
Capital in excess of par value
|
307
|
1,320
|
1,320
|
||||||||||
Retained earnings
|
13,843
|
10,944
|
12,191
|
||||||||||
Accumulated other comprehensive income
|
1
|
1
|
1
|
||||||||||
Total shareholders' equity
|
14,920
|
13,045
|
14,296
|
||||||||||
Total liabilities and shareholders' equity
|
$
|
26,037
|
$
|
22,988
|
$
|
24,639
|
|||||||
Consolidated
Statements of Current and Retained Earnings
(Unaudited)
|
|||||||||||||||||||||||||
In
Millions, Except Per Share Data
|
|||||||||||||||||||||||||
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||||||||||
|
July
29, 2005
|
July
29, 2005
|
|||||||||||||||||||||||
|
August
4, 2006
|
As
Restated
|
August
4, 2006
|
As
Restated
|
|||||||||||||||||||||
Current
Earnings
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||||||
Net
sales
|
$
|
13,389
|
100.00
|
$
|
11,929
|
100.00
|
$
|
25,310
|
100.00
|
$
|
21,842
|
100.00
|
|||||||||||||
Cost
of sales
|
8,911
|
66.56
|
7,902
|
66.24
|
16,664
|
65.84
|
14,417
|
66.01
|
|||||||||||||||||
Gross
margin
|
4,478
|
33.44
|
4,027
|
33.76
|
8,646
|
34.16
|
7,425
|
33.99
|
|||||||||||||||||
Expenses:
|
|||||||||||||||||||||||||
Selling,
general and administrative
|
2,617
|
19.54
|
2,363
|
19.81
|
5,083
|
20.09
|
4,499
|
20.60
|
|||||||||||||||||
Store
opening costs
|
28
|
0.21
|
25
|
0.21
|
53
|
0.20
|
50
|
0.23
|
|||||||||||||||||
Depreciation
|
283
|
2.11
|
236
|
1.97
|
557
|
2.20
|
473
|
2.16
|
|||||||||||||||||
Interest
|
30
|
0.23
|
39
|
0.33
|
65
|
0.26
|
86
|
0.39
|
|||||||||||||||||
Total
expenses
|
2,958
|
22.09
|
2,663
|
22.32
|
5,758
|
22.75
|
5,108
|
23.38
|
|||||||||||||||||
Pre-tax
earnings
|
1,520
|
11.35
|
1,364
|
11.44
|
2,888
|
11.41
|
2,317
|
10.61
|
|||||||||||||||||
Income
tax provision
|
585
|
4.37
|
525
|
4.41
|
1,112
|
4.39
|
892
|
4.08
|
|||||||||||||||||
Net
earnings
|
$
|
935
|
6.98
|
$
|
839
|
7.03
|
$
|
1,776
|
7.02
|
$
|
1,425
|
6.53
|
|||||||||||||
Weighted
average shares outstanding - basic
|
1,541
|
1,548
|
1,549
|
1,548
|
|||||||||||||||||||||
Basic
earnings per share
|
$
|
0.61
|
$
|
0.54
|
$
|
1.15
|
$
|
0.92
|
|||||||||||||||||
Weighted
average shares outstanding - diluted
|
1,571
|
1,605
|
1,580
|
1,608
|
|||||||||||||||||||||
Diluted
earnings per share
|
$
|
0.60
|
$
|
0.52
|
$
|
1.13
|
$
|
0.89
|
|||||||||||||||||
Cash
dividends per share
|
$
|
0.05
|
$
|
0.03
|
$
|
0.08
|
$
|
0.05
|
|||||||||||||||||
Retained
Earnings
|
|||||||||||||||||||||||||
Balance
at beginning of period
|
$
|
12,985
|
$
|
10,152
|
$
|
12,191
|
$
|
9,597
|
|||||||||||||||||
Net
earnings
|
935
|
839
|
1,776
|
1,425
|
|||||||||||||||||||||
Cash
dividends
|
(77
|
)
|
(47
|
)
|
(124
|
)
|
(78
|
)
|
|||||||||||||||||
Balance
at end of period
|
$
|
13,843
|
$
|
10,944
|
$
|
13,843
|
$
|
10,944
|
|||||||||||||||||
Lowe's
Companies, Inc.
|
|||||||
Consolidated
Statements of Cash Flows (Unaudited)
|
|||||||
In
Millions
|
|||||||
|
Six
Months Ended
|
||||||
|
July
29, 2005
|
||||||
|
|
|
August 4, 2006
|
As Restated
|
|||
Cash
flows from operating activities:
|
|||||||
Net earnings
|
$
|
1,776
|
$
|
1,425
|
|||
Adjustments to reconcile net earnings to net cash provided
by
|
|||||||
operating activities:
|
|||||||
Depreciation and amortization
|
591
|
508
|
|||||
Deferred income taxes
|
(34
|
)
|
(46
|
)
|
|||
Loss on disposition/writedown of fixed and other assets
|
5
|
17
|
|||||
Share-based payment expense
|
35
|
38
|
|||||
Changes in operating assets and liabilities:
|
|||||||
Merchandise inventory - net
|
(541
|
)
|
(316
|
)
|
|||
Other operating assets
|
(93
|
)
|
(29
|
)
|
|||
Accounts payable
|
797
|
292
|
|||||
Other operating liabilities
|
68
|
340
|
|||||
Net cash provided by operating activities
|
2,604
|
2,229
|
|||||
Cash
flows from investing activities:
|
|||||||
Purchases of short-term investments
|
(228
|
)
|
(234
|
)
|
|||
Proceeds from sale/maturity of short-term investments
|
399
|
163
|
|||||
Purchases of long-term investments
|
(225
|
)
|
(132
|
)
|
|||
Proceeds from sale/maturity of long-term investments
|
141
|
8
|
|||||
Decrease (increase) in other long-term assets
|
13
|
(35
|
)
|
||||
Fixed assets acquired
|
(1,556
|
)
|
(1,365
|
)
|
|||
Proceeds from the sale of fixed and other long-term assets
|
23
|
37
|
|||||
Net cash used in investing activities
|
(1,433
|
)
|
(1,558
|
)
|
|||
Cash
flows from financing activities:
|
|||||||
Repayment of long-term debt
|
(16
|
)
|
(16
|
)
|
|||
Proceeds from issuance of common stock under employee stock purchase
plan
|
36
|
32
|
|||||
Proceeds from issuance of common stock from stock options
exercised
|
48
|
147
|
|||||
Cash dividend payments
|
(124
|
)
|
(78
|
)
|
|||
Repurchase of common stock
|
(1,226
|
)
|
(299
|
)
|
|||
Excess tax benefits of share-based payments
|
4
|
-
|
|||||
Net cash used in financing activities
|
(1,278
|
)
|
(214
|
)
|
|||
Net
(decrease) increase in cash and cash equivalents
|
(107
|
)
|
457
|
||||
Cash
and cash equivalents, beginning of period
|
423
|
530
|
|||||
Cash
and cash equivalents, end of period
|
$
|
316
|
$
|
987
|
|||
|
Consolidated
Balance Sheet
|
|||||||||
July
29,
|
July
29,
|
|||||||||
2005
|
2005
|
|||||||||
(In
Millions)
|
As
Previously Reported (1)
|
|
Adjustments
|
As
Restated
|
||||||
Cash
and cash equivalents
|
$
|
1,112
|
$
|
(125
|
)
|
$
|
987
|
|||
Short-term
investments
|
307
|
125
|
432
|
|||||||
Merchandise
inventory - net
|
6,231
|
(66
|
)
|
6,165
|
||||||
Deferred
income taxes - net
|
95
|
26
|
121
|
|||||||
Total
current assets
|
7,858
|
(40
|
)
|
7,818
|
||||||
Total
assets
|
$
|
23,028
|
$
|
(40
|
)
|
$
|
22,988
|
|||
Retained
earnings
|
10,984
|
(40
|
)
|
10,944
|
||||||
Total
shareholders' equity
|
13,085
|
(40
|
)
|
13,045
|
||||||
Total
liabilities and shareholders' equity
|
$
|
23,028
|
$
|
(40
|
)
|
$
|
22,988
|
|
Consolidated
Balance Sheet
|
|||||||||
|
February 3,
|
February
3,
|
||||||||
2006
|
2006
|
|||||||||
(In
Millions)
|
As
Previously Reported
|
Adjustments
|
As
Restated
|
|||||||
Merchandise
inventory - net
|
$
|
6,706
|
$
|
(71
|
)
|
$
|
6,635
|
|||
Deferred
income taxes - net
|
127
|
28
|
155
|
|||||||
Total
current assets
|
7,831
|
(43
|
)
|
7,788
|
||||||
Total
assets
|
$
|
24,682
|
$
|
(43
|
)
|
$
|
24,639
|
|||
Retained
earnings
|
12,234
|
(43
|
)
|
12,191
|
||||||
Total
shareholders' equity
|
14,339
|
(43
|
)
|
14,296
|
||||||
Total
liabilities and shareholders' equity
|
$
|
24,682
|
$
|
(43
|
)
|
$
|
24,639
|
|
Consolidated
Statement of Earnings
|
|||||||||
|
|
|
July
29,
|
July
29,
|
||||||
Three
Months Ended
|
2005
|
2005
|
||||||||
(In
Millions, Except Per Share Data)
|
As
Previously Reported (1)
|
|
Adjustments
|
As
Restated
|
||||||
Cost
of sales
|
$
|
7,903
|
$
|
(1
|
)
|
$
|
7,902
|
|||
Gross
margin
|
4,026
|
1
|
4,027
|
|||||||
Pre-tax
earnings
|
1,363
|
1
|
1,364
|
|||||||
Income
tax provision
|
525
|
-
|
525
|
|||||||
Net
earnings
|
$
|
838
|
$
|
1
|
$
|
839
|
||||
Basic
earnings per share
|
$
|
0.54
|
$
|
-
|
$
|
0.54
|
||||
Diluted
earnings per share
|
$
|
0.52
|
$
|
-
|
$
|
0.52
|
|
|
|
||||||||
|
July
29,
|
July
29,
|
||||||||
Six
Months Ended
|
2005
|
2005
|
||||||||
(In
Millions, Except Per Share Data)
|
As
Previously Reported (1)
|
|
Adjustments
|
As
Restated
|
||||||
Cost
of sales
|
$
|
14,412
|
$
|
5
|
$
|
14,417
|
||||
Gross
margin
|
7,430
|
(5
|
)
|
7,425
|
||||||
Pre-tax
earnings
|
2,322
|
(5
|
)
|
2,317
|
||||||
Income
tax provision
|
894
|
(2
|
)
|
892
|
||||||
Net
earnings
|
$
|
1,428
|
$
|
(3
|
)
|
$
|
1,425
|
|||
Basic
earnings per share
|
$
|
0.92
|
$
|
-
|
$
|
0.92
|
||||
Diluted
earnings per share
|
$
|
0.89
|
$
|
-
|
$
|
0.89
|
|
Consolidated
Statement of Shareholders' Equity
|
|||||||||
|
January
28,
|
January
28,
|
||||||||
2005
|
2005
|
|||||||||
(In
Millions)
|
As
Previously Reported
|
Adjustments
|
As
Restated
|
|||||||
Retained
earnings
|
$
|
9,634
|
$
|
(37
|
)(2)
|
$
|
9,597
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||||
(In
Millions, Except Per Share Data)
|
August
4, 2006
|
July
29, 2005
|
August
4, 2006
|
July
29, 2005
|
|||||||||
Net
earnings
|
$
|
935
|
$
|
839
|
$
|
1,776
|
$
|
1,425
|
|||||
Weighted
average shares outstanding
|
1,541
|
1,548
|
1,549
|
1,548
|
|||||||||
Basic
earnings per share
|
$
|
0.61
|
$
|
0.54
|
$
|
1.15
|
$
|
0.92
|
|||||
Diluted
earnings per share:
|
|||||||||||||
Net
earnings
|
$
|
935
|
$
|
839
|
$
|
1,776
|
$
|
1,425
|
|||||
Net
earnings adjustment for interest on convertible debt, net of
tax
|
1
|
3
|
2
|
7
|
|||||||||
Net
earnings, as adjusted
|
$
|
936
|
$
|
842
|
$
|
1,778
|
$
|
1,432
|
|||||
Weighted
average shares outstanding
|
1,541
|
1,548
|
1,549
|
1,548
|
|||||||||
Dilutive
effect of stock options
|
8
|
9
|
8
|
9
|
|||||||||
Dilutive
effect of convertible debt
|
22
|
48
|
23
|
51
|
|||||||||
Weighted
average shares, as adjusted
|
1,571
|
1,605
|
1,580
|
1,608
|
|||||||||
Diluted
earnings per share
|
$
|
0.60
|
$
|
0.52
|
$
|
1.13
|
$
|
0.89
|
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||
(In
Millions)
|
August
4,
2006
|
July
29,
2005
|
August
4,
2006
|
July
29,
2005
|
|||||||||
Long-term
debt
|
$
|
42
|
$
|
39
|
$
|
83
|
$
|
79
|
|||||
Mortgage
interest
|
1
|
1
|
1
|
2
|
|||||||||
Capitalized
leases
|
9
|
10
|
19
|
20
|
|||||||||
Amortization
of original issue discount
and loan costs
|
1
|
5
|
2
|
10
|
|||||||||
Interest
income
|
(15
|
)
|
(11
|
)
|
(27
|
)
|
(15
|
)
|
|||||
Interest
capitalized
|
(8
|
)
|
(5
|
)
|
(13
|
)
|
(10
|
)
|
|||||
Net
interest expense
|
$
|
30
|
$
|
39
|
$
|
65
|
$
|
86
|
|
Six
Months Ended
|
||||||
(In
Millions)
|
August
4,
2006
|
July
29,
2005
|
|||||
Cash
paid for interest (net of amount capitalized)
|
$
|
92
|
$
|
90
|
|||
Cash
paid for income taxes
|
$
|
1,272
|
$
|
884
|
|||
Non-cash
investing and financing activities:
|
|||||||
Conversions
of long-term debt to equity
|
$
|
74
|
$
|
245
|
|||
Non-cash
fixed asset acquisitions, including assets acquired under capital
lease
|
$
|
26
|
$
|
40
|
|
Three Months Ended |
Six
Months Ended
|
|||||
|
July
29,
|
July
29,
|
|||||
(In Millions, Excepts Per Share Data) |
2005
|
2005
|
|||||
Net
earnings, as reported
|
$
|
839
|
$
|
1,425
|
|||
Add:
Stock-based compensation expense included in net earnings, net
of
related tax effects
|
13
|
23
|
|||||
Deduct:
Total stock-based compensation expense determined under the fair-value
based method for all awards, net of related tax effects
|
(13
|
)
|
(25
|
)
|
|||
Pro
forma net earnings
|
$
|
839
|
$
|
1,423
|
|||
Earnings
per share:
|
|||||||
Basic
- as reported
|
$
|
0.54
|
$
|
0.92
|
|||
Basic
- pro forma
|
$
|
0.54
|
$
|
0.92
|
|||
Diluted
- as reported
|
$
|
0.52
|
$
|
0.89
|
|||
Diluted
- pro forma
|
$
|
0.52
|
$
|
0.89
|
|
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||
|
August
4, 2006
|
July
29,
2005
|
August
4,
2006
|
July
29,
2005
|
|||||||||
Assumptions
used:
|
|||||||||||||
Expected
volatility
|
22.3%-27.2%
|
|
N/A
|
22.3%-29.4%
|
|
30.8%-34.1%
|
|
||||||
Weighted
average expected volatility
|
24.1%
|
|
-
|
26.8%
|
|
31.6%
|
|
||||||
Expected
dividend yield
|
0.29%-0.31%
|
|
N/A
|
0.27%-0.31%
|
|
0.23%-0.24%
|
|
||||||
Weighted
average dividend yield
|
0.30%
|
|
-
|
0.28%
|
|
0.23%
|
|
||||||
Risk-free
interest rate
|
4.91%
|
|
N/A
|
4.66%-4.97%
|
|
3.76%-3.89%
|
|
||||||
Weighted
average risk-free interest rate
|
4.91%
|
|
-
|
4.69%
|
|
3.79%
|
|
||||||
Expected
term, in years
|
3-4
|
N/A
|
3-4
|
3-4
|
|||||||||
Weighted
average expected term, in years
|
3.36
|
-
|
3.57
|
3.24
|
|
Shares
(In
Thousands)
|
Weighted-Average
Exercise Price Per Share
|
|
Weighted-Average
Remaining Term
(In
Years)
|
|
Aggregate
Intrinsic Value
(In
Thousands)
|
|
||||||
Outstanding
at February 3, 2006
|
30,595
|
$
|
22.48
|
||||||||||
Granted
|
6,684
|
33.66
|
|||||||||||
Canceled,
forfeited or expired
|
(593
|
)
|
31.19
|
||||||||||
Exercised
|
(2,462
|
)
|
19.73
|
||||||||||
Outstanding
at August 4, 2006
|
34,224
|
24.72
|
4.0
|
$
|
174,132
|
||||||||
Vested
and expected to vest at August 4, 2006 (1)
|
32,938
|
24.43
|
3.9
|
174,029
|
|||||||||
Exercisable
at August 4, 2006
|
22,819
|
$
|
21.27
|
3.0
|
$
|
172,620
|
|
Shares
|
Weighted-Average
Grant-Date Fair Value Per Share
|
|||||
Nonvested
at February 3, 2006
|
595,830
|
$
|
29.25
|
||||
Granted
|
893,160
|
34.10
|
|||||
Canceled
or forfeited
|
(33,712
|
)
|
31.95
|
||||
Nonvested
at August 4, 2006
|
1,455,278
|
$
|
32.16
|
|
Shares
|
Weighted-Average
Grant-Date Fair Value Per Share
|
|||||
Nonvested
at February 3, 2006
|
1,765,312
|
$
|
31.17
|
||||
Granted
|
3,200
|
28.15
|
|||||
Canceled
or forfeited
|
(52,018
|
)
|
30.50
|
||||
Nonvested
at August 4, 2006
|
1,716,494
|
$
|
31.19
|
|
Shares
|
Weighted-Average
Grant-Date Fair Value Per Share
|
|||||
Nonvested
at February 3, 2006
|
500,000
|
$
|
19.65
|
||||
Granted
|
38,000
|
31.02
|
|||||
Vested
|
(158,000
|
)
|
22.38
|
||||
Nonvested
at August 4, 2006
|
380,000
|
$
|
19.65
|
|
Three
Months Ended
|
Basis
Point Increase / (Decrease) in Percentage of Net Sales from Prior
Period
|
Percentage
Increase / (Decrease) in Dollar Amounts from Prior
Period
|
||||||||||
|
August
4, 2006
|
July
29, 2005
|
2006
vs. 2005
|
2006
vs. 2005
|
|||||||||
Net
sales
|
100.00
|
%
|
100.00
|
%
|
N/A
|
12
|
%
|
||||||
Gross
margin
|
33.44
|
33.76
|
(32
|
)
|
11
|
||||||||
Expenses:
|
|||||||||||||
Selling,
general and administrative
|
19.54
|
19.81
|
(27
|
)
|
11
|
||||||||
Store
opening costs
|
0.21
|
0.21
|
0
|
12
|
|||||||||
Depreciation
|
2.11
|
1.97
|
14
|
20
|
|||||||||
Interest
|
0.23
|
0.33
|
(10
|
)
|
(23
|
)
|
|||||||
Total
expenses
|
22.09
|
22.32
|
(23
|
)
|
11
|
||||||||
Pre-tax
earnings
|
11.35
|
11.44
|
(9
|
)
|
11
|
||||||||
Income
tax provision
|
4.37
|
4.41
|
(4
|
)
|
11
|
||||||||
Net
earnings
|
6.98
|
%
|
7.03
|
%
|
(5
|
)
|
11
|
%
|
|
|
Six
Months Ended
|
Basis
Point Increase / (Decrease) in Percentage of Net Sales from Prior
Period
|
Percentage
Increase / (Decrease) in Dollar Amounts from Prior
Period
|
|||||||||
|
August
4, 2006
|
July
29, 2005
|
2006
vs. 2005
|
2006
vs. 2005
|
|||||||||
Net
sales
|
100.00
|
%
|
100.00
|
%
|
N/A
|
16
|
%
|
||||||
Gross
margin
|
34.16
|
33.99
|
17
|
16
|
|||||||||
Expenses:
|
|||||||||||||
Selling,
general and administrative
|
20.09
|
20.60
|
(51
|
)
|
13
|
||||||||
Store
opening costs
|
0.20
|
0.23
|
(3
|
)
|
6
|
||||||||
Depreciation
|
2.20
|
2.16
|
4
|
18
|
|||||||||
Interest
|
0.26
|
0.39
|
(13
|
)
|
(24
|
)
|
|||||||
Total
expenses
|
22.75
|
23.38
|
(63
|
)
|
13
|
||||||||
Pre-tax
earnings
|
11.41
|
10.61
|
80
|
25
|
|||||||||
Income
tax provision
|
4.39
|
4.08
|
31
|
25
|
|||||||||
Net
earnings
|
7.02
|
%
|
6.53
|
%
|
49
|
25
|
%
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||||
Other
Metrics
|
August
4, 2006
|
July
29, 2005
|
August
4, 2006
|
July
29, 2005
|
|||||||||
Comparable
store sales increases 1
|
3.3
|
%
|
6.5
|
%
|
4.4
|
%
|
5.2
|
%
|
|||||
Customer
transactions (in millions)
|
191
|
177
|
359
|
326
|
|||||||||
Average
ticket 2
|
$
|
70.21
|
$
|
67.40
|
$
|
70.46
|
$
|
66.91
|
|||||
At
end of period:
|
|||||||||||||
Number
of stores
|
1,281
|
1,138
|
|||||||||||
Sales
floor square feet (in millions)
|
145
|
129
|
|||||||||||
Average
store size square feet (in thousands)
|
113
|
114
|
Current
Debt Ratings
|
S&P
|
|
|
Moody’s
|
|
|
Fitch
|
|||
Commercial
Paper
|
|
|
A1
|
P1
|
F1+
|
|||||
Senior
debt
|
A+
|
A2
|
A+
|
|||||||
Outlook
|
Stable
|
Positive
|
Stable
|
Issuer
Purchases of Equity Securities
|
|||||||||||||
(In
Millions, Except Average
Price
Paid Per Share)
|
Total
Number of Shares Purchased(1)
|
|
Average
Price Paid per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans
or
Programs(2)
|
|
Dollar
Value of Shares that May Yet Be Purchased Under the Plans or
Programs(2)
|
|
||||||
May 6, 2006 - June 2, 2006 | 5.9 | $ | 31.12 | 5.9 | $ | 444 | |||||||
June 3, 2006 - July 7, 2006 | 14.3 | 31.01 | 14.3 | - | |||||||||
July 8, 2006 - August 4, 2006 | - | - | - | - | |||||||||
- | |||||||||||||
As of August 4, 2006 | 20.2 | $ | 31.04 | 20.2 | $ | - | |||||||
(1) |
During
the second quarter of fiscal 2006, the Company repurchased an aggregate
of
20,169,800 shares of its common stock pursuant to the Program. The
total number of shares purchased also includes a nominal amount of
shares
repurchased from employees to satisfy the exercise price of certain
stock
option exercises.
|
(2) |
On
August 18, 2006, the Board of Directors authorized the Company to
repurchase up to an additional $2 billion of common shares through
fiscal
2008. The Company expects to implement the program through purchases
made
from time to time either in the open market or through private
transactions, in accordance with regulations of the Securities and
Exchange Commission.
|
|
CLASS
|
TERM
EXPIRING
|
FOR
|
WITHHELD
|
|||||||||
Peter
C. Browning
|
II
|
2009
|
694,647,374
|
11,162,599
|
|||||||||
Marshall
O. Larsen
|
II
|
2009
|
700,063,731
|
5,746,242
|
|||||||||
Stephen
F. Page
|
II
|
2009
|
700,163,881
|
5,646,093
|
|||||||||
O.
Temple Sloan, Jr.
|
II
|
2009
|
700,034,341
|
5,775,633
|
FOR
|
AGAINST
|
ABSTAIN
|
BROKER
NON
VOTE
|
|||||||
684,741,729
|
15,563,960
|
5,504,284
|
1
|
FOR
|
AGAINST
|
ABSTAIN
|
BROKER
NON
VOTE
|
|||||||
583,834,810
|
24,825,116
|
5,361,718
|
91,788,329
|
FOR
|
AGAINST
|
|
|
ABSTAIN
|
|
||
695,688,877
|
|
|
6,105,739
|
|
|
4,015,357
|
FOR
|
AGAINST
|
|
|
ABSTAIN
|
|||
620,045,632
|
72,311,767
|
|
|
13,452,574
|
|
FOR
|
AGAINST
|
|
|
ABSTAIN
|
|
|
BROKER
NON
VOTE
|
|||
39,178,476
|
520,733,781
|
|
|
54,109,387
|
|
|
91,788,329
|
|
LOWE'S
COMPANIES, INC.
|
||
September
7, 2006
Date
|
/s/Matthew
V. Hollifield
Matthew
V. Hollifield
Senior
Vice President and Chief Accounting
Officer
|
Exhibit
No.
|
|
Description
|
|
|
|
3.1
|
Restated and Amended Charter, July 3, 2006 | |
10.1
|
Lowe's Companies, Inc. 2006 Annual Incentive Plan | |
10.2
|
Lowe's Companies, Inc.2006 Long Term Incentive Plan | |
15.1
|
Deloitte & Touche LLP Letter re unaudited interim financial information | |
31.1
|
|
Certification
Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities
Exchange
Act of 1934, as amended
|
|
|
|
31.2
|
|
Certification
Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities
Exchange
Act of 1934, as amended
|
|
|
|
32.1
|
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of
the Sarbanes-Oxley Act of 2002
|
|
|
|
32.2
|
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of
the Sarbanes-Oxley Act of 2002
|