Page 44 - HW May-June 2020

global eyes
“Right place, right time” for US home improvement
IN CONTRAST TO some US retailers, Home Depot, Lowe’s and Ace Hardware all reported decent sales growth in the January-March rst quarter of FY2020.
Sucharita Kodali, a retail analyst at Forrester, puts it that the biggest names in US DIY retailing were simply “in the right place at the right time” and bene tted from nesting, stay-at-home consumers spending on home improvements.
Add to this their status as an essential store type and that the US was going into peak DIY season and – despite the then impending disruption caused by the COVID-19 running rampant in the US – they’ve done pretty well.
Looking further out, however, given the extreme levels of uncertainty around the US economy, not one of the big US barns feels it can make a forecast or issue a market outlook...
Home Depot’s COVID spend –
e Home Depot reported Q1 sales
of US$28.3 billion, +7.1% on the rst quarter of scal 2019. Comparable sales were +6.4% and US comparables +7.5%.
e numbers were
pretty well received, especially given e
Home Depot has spent some US$850 million (pre-tax) on COVID-
19 support measures
for sta during the
quarter, even if this has touched the bottom
line, with Q1 net
earnings down from
US$2.5 billion last FY
to US$2.5 billion in FY2020.
However, while reporting sales trends at the end of the rst quarter and into the rst two weeks of the second quarter as “strong”, as “a result of the uncertainty related to the duration of COVID-19 and its impact on the broader economy”, e Home Depot has suspended its previously communicated guidance for FY2020.
www.homedepot.com
Lowe’s shows better comps – Lowe’s reported Q1 FY2020 net earnings of
US$1.3 billion, up on net earnings of $1 billion, with sales of US$19.7 billion up from US$17.7 billion, comparable sales +11.2% and US comps +12.3%.
Reporting strong sales continuing into May, with online sales +80%, Lowe’s too invested some US$340 million in supporting sta and rst responders
so far during the crisis by the way. Still, Lowe’s is “withdrawing its nancial guidance for scal year 2020. e Company delivered strong nancial performance in the rst quarter, with continued sales momentum in May.
42 NZHJ | MAY/JUNE 2020
MORE AT www.hardwarejournal.co.nz