Consolidated Balance Sheets
Consolidated Balance Sheets (USD $) | |||
In Millions | Oct. 30, 2009
| Jan. 30, 2009
| Oct. 31, 2008
|
Assets | |||
Cash and cash equivalents | $1,141 | $245 | $322 |
Short-term investments | 509 | 416 | 445 |
Merchandise inventory - net | 8,424 | 8,209 | 8,327 |
Deferred income taxes - net | 205 | 166 | 230 |
Other current assets | 213 | 215 | 197 |
Total current assets | 10,492 | 9,251 | 9,521 |
Property, less accumulated depreciation | 22,557 | 22,722 | 22,602 |
Long-term investments | 864 | 253 | 466 |
Other assets | 496 | 460 | 440 |
Total assets | 34,409 | 32,686 | 33,029 |
Liabilities and Shareholders' Equity | |||
Short-term borrowings | 0 | 987 | 249 |
Current maturities of long-term debt | 553 | 34 | 34 |
Accounts payable | 5,046 | 4,109 | 4,831 |
Accrued compensation and employee benefits | 558 | 434 | 516 |
Self-insurance liabilities | 780 | 751 | 723 |
Deferred revenue | 719 | 674 | 748 |
Other current liabilities | 1,321 | 1,033 | 1,330 |
Total current liabilities | 8,977 | 8,022 | 8,431 |
Long-term debt, excluding current maturities | 4,524 | 5,039 | 5,044 |
Deferred income taxes - net | 556 | 660 | 751 |
Other liabilities | 933 | 910 | 846 |
Total liabilities | 14,990 | 14,631 | 15,072 |
Preferred stock - $5 par value, none issued | 0 | 0 | 0 |
Common stock - $.50 par value | 739 | 735 | 734 |
Capital in excess of par value | 398 | 277 | 215 |
Retained earnings | 18,236 | 17,049 | 17,012 |
Accumulated other comprehensive income (loss) | 46 | (6) | (4) |
Total shareholders' equity | 19,419 | 18,055 | 17,957 |
Total liabilities and shareholders' equity | $34,409 | $32,686 | $33,029 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Par Value Disclosures) (USD $) | |||
Oct. 30, 2009
| Jan. 30, 2009
| Oct. 31, 2008
| |
Shareholders' equity: | |||
Preferred stock - $5 par value, none issued | 5 | 5 | 5 |
Common stock - $.50 par value | 0.5 | 0.5 | 0.5 |
Consolidated Balance Sheets (Sh
Consolidated Balance Sheets (Shares Issued and Oustanding Disclosures) (USD $) | |||
Share data in Millions | Oct. 30, 2009
| Jan. 30, 2009
| Oct. 31, 2008
|
Shareholders' equity: | |||
Preferred stock; shares issued and outstanding | 0 | 0 | 0 |
Common stock; shares issued and outstanding | 1,477 | 1,470 | 1,467 |
Consolidated Statements of Curr
Consolidated Statements of Current and Retained Earnings (USD $) | ||||
In Millions, unless otherwise specified | 3 Months Ended
Oct. 30, 2009 | 3 Months Ended
Oct. 31, 2008 | 9 Months Ended
Oct. 30, 2009 | 9 Months Ended
Oct. 31, 2008 |
Current Earnings | ||||
Net sales | $11,375 | $11,728 | $37,052 | $38,246 |
Cost of sales | 7,485 | 7,743 | 24,143 | 25,113 |
Gross margin | 3,890 | 3,985 | 12,909 | 13,133 |
Expenses: | ||||
Selling, general and administrative | 2,872 | 2,726 | 8,924 | 8,464 |
Store opening costs | 10 | 31 | 38 | 70 |
Depreciation | 403 | 385 | 1,212 | 1,142 |
Interest - net | 77 | 65 | 231 | 210 |
Total expenses | 3,362 | 3,207 | 10,405 | 9,886 |
Pre-tax earnings | 528 | 778 | 2,504 | 3,247 |
Income tax provision | 184 | 290 | 926 | 1,214 |
Net earnings | 344 | 488 | 1,578 | 2,033 |
Weighted average common shares outstanding - basic | 1,466 | 1,459 | 1,464 | 1,456 |
Basic earnings per common share | 0.23 | 0.33 | 1.07 | 1.39 |
Weighted average common shares outstanding - diluted | 1,469 | 1,461 | 1,466 | 1,469 |
Diluted earnings per common share | 0.23 | 0.33 | 1.07 | 1.38 |
Cash dividends per share | 0.09 | 0.085 | 0.265 | 0.25 |
Retained Earnings | ||||
Balance at beginning of period | 18,025 | 16,648 | 17,049 | 15,345 |
Net earnings | 344 | 488 | 1,578 | 2,033 |
Cash dividends | (133) | (124) | (391) | (366) |
Balance at end of period | $18,236 | $17,012 | $18,236 | $17,012 |
1_Consolidated Statements of Cu
Consolidated Statements of Current and Retained Earnings (Percents) (USD $) | ||||
3 Months Ended
Oct. 30, 2009 | 3 Months Ended
Oct. 31, 2008 | 9 Months Ended
Oct. 30, 2009 | 9 Months Ended
Oct. 31, 2008 | |
Current Earnings | ||||
Net Sales | 1 | 1 | 1 | 1 |
Cost of Sales | 0.658 | 0.6602 | 0.6516 | 0.6566 |
Gross margin | 0.342 | 0.3398 | 0.3484 | 0.3434 |
Expenses: | ||||
Selling, general and administrative | 0.2525 | 0.2323 | 0.2409 | 0.2213 |
Store opening costs | 0.0009 | 0.0027 | 0.001 | 0.0018 |
Depreciation | 0.0354 | 0.0329 | 0.0327 | 0.0299 |
Interest - net | 0.0068 | 0.0056 | 0.0062 | 0.0055 |
Total expenses | 0.2956 | 0.2735 | 0.2808 | 0.2585 |
Pre-tax earnings | 0.0464 | 0.0663 | 0.0676 | 0.0849 |
Income tax provision | 0.0162 | 0.0247 | 0.025 | 0.0317 |
Net earnings | 0.0302 | 0.0416 | 0.0426 | 0.0532 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (USD $) | ||
In Millions | 9 Months Ended
Oct. 30, 2009 | 9 Months Ended
Oct. 31, 2008 |
Cash flows from operating activities: | ||
Net earnings | $1,578 | $2,033 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 1,303 | 1,232 |
Deferred income taxes | (142) | 99 |
Loss on property and other assets - net | 140 | 48 |
Loss on redemption of long-term debt | 0 | 8 |
Share-based payment expense | 78 | 79 |
Net changes in operating assets and liabilities: | ||
Merchandise inventory - net | (203) | (725) |
Other operating assets | (4) | 77 |
Accounts payable | 933 | 1,124 |
Other operating liabilities | 684 | 383 |
Net cash provided by operating activities | 4,367 | 4,358 |
Cash flows from investing activities: | ||
Purchases of short-term investments | (283) | (179) |
Proceeds from sale/maturity of short-term investments | 397 | 265 |
Purchases of long-term investments | (1,204) | (1,097) |
Proceeds from sale/maturity of long-term investments | 380 | 837 |
Increase in other long-term assets | (19) | (53) |
Property acquired | (1,414) | (2,539) |
Proceeds from sale of property and other long-term assets | 17 | 26 |
Net cash used in investing activities | (2,126) | (2,740) |
Cash flows from financing activities: | ||
Net decrease in short-term borrowings | (1,002) | (786) |
Proceeds from issuance of long-term debt | 3 | 13 |
Repayment of long-term debt | (27) | (564) |
Proceeds from issuance of common stock under employee stock purchase plan | 37 | 39 |
Proceeds from issuance of common stock from stock options exercised | 22 | 94 |
Cash dividend payments | (391) | (366) |
Repurchase of common stock | (4) | (8) |
Excess tax benefits of share-based payments | 0 | 1 |
Net cash used in financing activities | (1,362) | (1,577) |
Effect of exchange rate changes on cash | 17 | 0 |
Net increase in cash and cash equivalents | 896 | 41 |
Cash and cash equivalents, beginning of period | 245 | 281 |
Cash and cash equivalents, end of period | $1,141 | $322 |
Basis of Presentation
Basis of Presentation | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Basis of Presentation | Note 1: Basis of Presentation - The accompanying consolidated financial statements (unaudited) and notes to consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements (unaudited), in the opinion of management, contain all adjustments necessary to present fairly the financial position as of October 30, 2009, and October 31, 2008, and the results of operations for the three and nine months ended October 30, 2009, and October 31, 2008, and cash flows for the nine months ended October 30, 2009 and October 31, 2008. The Company has evaluated subsequent events through December 1, 2009, the date the consolidated financial statements were issued.These interim consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe's Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended January 30, 2009 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year. |
Fair Value Measurements and Fin
Fair Value Measurements and Financial Instruments | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Fair Value Measurements and Financial Instruments | Note 2: Fair Value Measurements and Financial Instruments - Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows: Level 1 - inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilitiesLevel 2 - inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectlyLevel 3 - inputs to the valuation techniques that are unobservable for the assets or liabilitiesAssets and Liabilities that are Measured at Fair Value on a Recurring BasisThe following tables present the Companys financial assets measured at fair value on a recurring basis as of October 30, 2009, October 31, 2008, and January 30, 2009, classified by fair value hierarchy: Fair Value Measurements at Reporting Date Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (In millions) October 30, 2009 (Level 1) (Level 2) (Level 3) Short-term investments Available-for-sale securities $ 469 $ 98 $ 371 $ - Trading securities 40 40 - - Long-term investments Available-for-sale securities 864 - 864 - Fair Value Measurements at Reporting Date Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (In millions) October 31, 2008 (Level 1) (Level 2) (Level 3) Short-term investments Available-for-sale securities $ 412 $ 122 $ 290 $ - Trading securities 33 33 - - Long-term investments Available-for-sale securities 466 - 466 - Fair Value Measurements at Reporting Date Using Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (In millions) January 30, 2009 (Level 1) (Level 2) (Level 3) Short-term investments Available-for-sale securities $ 385 $ 81 $ 304 $ - Trading securities 31 31 - - Long-term investments Available-for-sale securities 253 - 253 - When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. The Companys Level 1 investments primarily consist of investments in money market and mutual funds. When quoted prices in active markets are not available, fair values are determined using pricing models and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. The Companys Level 2 investments primarily |
Restricted Investment Balances
Restricted Investment Balances | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Restricted Investment Balances | Note 3: Restricted Investment Balances - Short-term and long-term investments include restricted balances pledged as collateral for letters of credit for the Companys extended warranty program and for a portion of the Companys casualty insurance and Installed Sales program liabilities. Restricted balances included in short-term investments were $233 million at October 30, 2009, $227 million at October 31, 2008, and $214 million at January 30, 2009. Restricted balances included in long-term investments were $147 million at October 30, 2009, $119 million at October 31, 2008, and $143 million at January 30, 2009. |
Property
Property | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Property | Note 4: Property - Property is shown net of accumulated depreciation of $9.7 billion at October 30, 2009, $8.5 billion at October 31, 2008, and $8.8 billion at January 30, 2009. |
Extended Warranties
Extended Warranties | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Extended Warranties | Note 5: Extended Warranties The Company sells separately-priced extended warranty contracts under a Lowes-branded program for which the Company is ultimately self-insured. The Company recognizes revenue from extended warranty sales on a straight-line basis over the respective contract term. Extended warranty contract terms primarily range from one to four years from the date of purchase or the end of the manufacturers warranty, as applicable. The Companys extended warranty deferred revenue is included in other liabilities (non-current) on the consolidated balance sheets. Changes in deferred revenue for extended warranty contracts are summarized as follows: Three Months Ended Nine Months Ended (In millions) October 30, 2009 October 31, 2008 October 30, 2009 October 31, 2008 Extended warranty deferred revenue, beginning of period $ 521 $ 456 $ 479 $ 407 Additions to deferred revenue 53 45 167 150 Deferred revenue recognized (39) (32) (111) (88) Extended warranty deferred revenue, end of period $ 535 $ 469 $ 535 $ 469 Incremental direct acquisition costs associated with the sale of extended warranties are also deferred and recognized as expense on a straight-line basis over the respective contract term. Deferred costs associated with extended warranty contracts were $143 million at October 30, 2009, $116 million at October 31, 2008, and $121 million at January 30, 2009. The Companys extended warranty deferred costs are included in other assets (non-current) on the consolidated balance sheets. All other costs, such as costs of services performed under the contract, general and administrative expenses and advertising expenses, are expensed as incurred.The liability for extended warranty claims incurred is included in self-insurance liabilities on the consolidated balance sheets. Changes in the liability for extended warranty claims are summarized as follows: Three Months Ended Nine Months Ended (In millions) October 30, 2009 October 31, 2008 October 30, 2009 October 31, 2008 Liability for extended warranty claims, beginning of period $ 21 $ 17 $ 17 $ 14 Accrual for claims incurred 19 15 49 40 Claim payments (17) (13) (43) (35) Liability for extended warranty claims, end of period $ 23 $ 19 $ 23 $ 19 |
Comprehensive Income
Comprehensive Income | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Comprehensive Income | Note 6: Comprehensive Income - Comprehensive income represents changes in shareholders equity from non-owner sources and is comprised of net earnings plus or minus unrealized gains or losses on available-for-sale securities and foreign currency translation adjustments. The following table reconciles net earnings to comprehensive income for the three and nine months ended October 30, 2009, and October 31, 2008. Three Months Ended Nine Months Ended (In millions) October 30, 2009 October 31, 2008 October 30, 2009 October 31, 2008 Net earnings $ 344 $ 488 $ 1,578 $ 2,033 Foreign currency translation adjustments - (10) 51 (9) Net unrealized investment (losses) gains - (2) 2 (3) Comprehensive income $ 344 $ 476 $ 1,631 $ 2,021 |
Earnings Per Share
Earnings Per Share | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Earnings Per Share | Note 7: Earnings Per Share Effective January 31, 2009, the Company adopted authoritative guidance issued by the FASB that states that all outstanding unvested share-based payment awards that contain rights to nonforfeitable dividends participate in undistributed earnings with common shareholders and, therefore, need to be included in the earnings allocation in computing earnings per share under the two-class method. The retrospective application of the provisions of the guidance reduced previously reported basic earnings per common share by $0.01 for the nine months ended October 31, 2008. Under the two-class method, net earnings are reduced by the amount of dividends declared in the period for each class of common stock and participating security. The remaining undistributed earnings are then allocated to common stock and participating securities as if all of the net earnings for the period had been distributed. Basic earnings per common share excludes dilution and is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares as of the balance sheet date, as adjusted for the potential dilutive effect of non-participating share-based awards and convertible notes. The following table reconciles earnings per common share for the three and nine months ended October 30, 2009, and October 31, 2008. Three Months Ended Nine Months Ended (In millions, except per share data) October 30, 2009 October 31, 2008 October 30, 2009 October 31, 2008 Basic earnings per common share: Net earnings $ 344 $ 488 $ 1,578 $ 2,033 Less: Net earnings allocable to participating securities (3) (2) (12) (11) Net earnings allocable to common shares $ 341 $ 486 $ 1,566 $ 2,022 Weighted-average common shares outstanding 1,466 1,459 1,464 1,456 Basic earnings per common share $ 0.23 $ 0.33 $ 1.07 $ 1.39 Diluted earnings per common share: Net earnings $ 344 $ 488 $ 1,578 $ 2,033 Net earnings adjustment for interest on convertible notes, net of tax - - - 2 Net earnings, as adjusted 344 488 1,578 2,035 Less: Net earnings allocable to participating securities (3) (2) (12) (11) Net earnings allocable to common shares $ 341 $ 486 $ 1,566 $ 2,024 Weighted-average common shares outstanding 1,466 1,459 1,464 1,456 Dilutive effect of non-participating share-based awards 3 2 2 2 Dilutive effect of convertible notes - - - 11 Weighted-average common shares, as adjusted 1,469 1,461 1,466 1,469 Diluted earnings per common share $ 0.23 $ 0.33 $ 1.07 $ 1.38 Stock options to purchase 18.0 million and 19.4 million shares of common stock were excluded from the computation of diluted earnings per common share because their effect would have been anti-dilutive for the three months ended October 30, 2009, and October 31, 2008, respectively. Stock options to purchase 21.5 million and 17.8 million shares of common stock were excl |
Supplemental Disclosures
Supplemental Disclosures | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Supplemental Disclosure | Note 8: Supplemental Disclosure Net interest expense is comprised of the following: Three Months Ended Nine Months Ended (In millions) October 30, 2009 October 31, 2008 October 30, 2009 October 31, 2008 Long-term debt $ 73 $ 73 $ 219 $ 219 Short-term borrowings - 2 2 9 Capitalized leases 7 7 21 24 Interest income (4) (11) (13) (32) Interest capitalized (4) (10) (12) (25) Other 5 4 14 15 Interest - net $ 77 $ 65 $ 231 $ 210 Supplemental disclosures of cash flow information: Nine Months Ended (In millions) October 30, 2009 October 31, 2008 Cash paid for interest, net of amount capitalized $ 284 $ 287 Cash paid for income taxes $ 788 $ 952 Non-cash investing and financing activities: Non-cash property acquisitions $ 47 $ 185 Change in equity method investments $ (3) $ (5) Conversions of long-term debt to equity $ - $ 1 |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | |
9 Months Ended
Oct. 30, 2009 | |
Note to Consolidated Financial Statements | |
Recent Accounting Pronouncements | Note 9: Recent Accounting Pronouncements In June 2009, the FASB issued authoritative guidance which amends the derecognition guidance on accounting for transfers of financial assets. The guidance is effective for financial asset transfers occurring in fiscal years beginning after November 15, 2009, and interim periods within those fiscal years. The Company does not expect the adoption of the guidance to have a material impact on its consolidated financial statements.In June 2009, the FASB issued authoritative guidance which amends the consolidation guidance for variable interest entities. The guidance is effective for fiscal years beginning after November 15, 2009, and interim periods within those fiscal years. The Company does not expect the adoption of the guidance to have a material impact on its consolidated financial statements.In October 2009, the FASB issued authoritative guidance on multiple-deliverable revenue arrangements, which addresses the unit of accounting for arrangements involving multiple deliverables. The guidance also addresses how arrangement consideration should be allocated to separate units of accounting, when applicable, and expands the disclosure requirements for multiple-deliverable arrangements. The guidance is effective for fiscal years beginning after June 15, 2010. The Company is currently evaluating the impact of the guidance on its consolidated financial statements. |
Document and Entity Information
Document and Entity Information (USD $) | |||
9 Months Ended
Oct. 30, 2009 | Nov. 27, 2009
| Aug. 01, 2008
| |
Entity and document information | |||
Entity registrant name | LOWES COMPANIES INC, | ||
Entity central index key | 0000060667 | ||
Document type | 10-Q | ||
Document period end date | 2009-10-30 | ||
Amendment flag | false | ||
Current fiscal year end date | --01-30 | ||
Entity well known seasoned issuer | Yes | ||
Entity voluntary filers | No | ||
Entity current reporting status | Yes | ||
Entity filer category | Large Accelerated Filer | ||
Entity public float | $22,800,000,000 | ||
Entity common stock shares outstanding | 1,472,032,172 |