Lowe's Closing 20 Underperforming Stores

Dec 8, 2004
49,073
21,096
693
Maine
#1
Note: The Company has a quiet period that begins ten business days prior to the end of each fiscal quarter and extends until the public release of earnings for that quarter. During the quiet period, management is prohibited from commenting on earnings, current business trends or future expectations. The Company is currently in its quiet period; however, it is providing the following additional information about both the store closings and discontinued projects that it announced in a press release issued October 17, 2011.

The Company is closing 20 underperforming stores in 15 states. Ten locations closed at the end of business Sunday, October 16. The remaining 10 locations will close within approximately one month, following an inventory sell-through.

The stores affected are located in:

Los Banos, CA
Biddeford, ME
Old Bridge, NJ
Westminster, CA
Ellsworth, ME
Batavia, NY
Denver, CO
Ionia, MI
N. Kingstown, RI
Aurora, IL
Rogers, MN
Emporia, VA
Oswego, IL
Claremont, NH
S. Tacoma, WA
Chalmette, LA
Hooksett, NH
Brown Deer, WI
Haverhill, MA
Manchester, NH

The average age of these stores is approximately four years. The stores can be stratified by year of opening as follows:

After 2007 10
2006 - 2007 8
Before 2006 2

Of the 20 stores, 11 are leased locations and nine are owned.

In addition to the store closings, after completing a comprehensive review of its pipeline of proposed new stores, the Company announced it has discontinued a number of planned new store projects. The Company now expects to open 10 to 15 stores per year from 2012 forward, compared to a prior assumption of approximately 30 stores per year. All of these stores will be in North America. The Company is on track to open approximately 25 stores in 2011, as planned. Approximately three-fourths of these stores will be in the U.S. with the remainder in Canada.

The expected financial impact of $0.17 to $0.20 per diluted share was not contemplated in the business outlook for fiscal 2011 which the Company provided on August 15 when it released its second quarter earnings. This expected impact reflects anticipated charges of $345 to $415 million, which include the following:

Exit costs, including costs associated with lease obligations, employee terminations and inventory adjustments Impairment of long-lived assets and the write-off of discontinued project costs
The Company expects to recognize total exit costs related to the store closings and discontinued projects of $100 to $130 million. Charges associated with lease obligations, net of estimated sublease income, are estimated to range from $80 to $100 million. Charges associated with employee termination costs are estimated to range from $10 to $15 million. Charges associated with the lower of cost or market adjustments to inventory are expected to range from $10 to $15 million. All estimated amounts are subject to change until finalized. Charges for these exit costs are expected to be recorded in the third and fourth quarters of fiscal 2011. Total future cash outflows associated with these charges, consisting of net payments on the lease obligations over remaining lease terms and employee termination costs, are expected to be $90 to $115 million.

The store closings and discontinued projects are expected to result in a non-cash charge ranging from $245 to $285 million for impairment of the Company’s long-lived assets associated with these locations and the write-off of discontinued project costs. The non-cash charge is expected to be recognized entirely in the third quarter of fiscal 2011.
If you time it right when they are clearing out stuff you can get shit wicked cheap...
 

Stig

Wackbag's New Favorite Heel
Jul 26, 2005
80,720
4,448
623
NH
#2
Holy shit they just built the ones in Manchester and hooksett in the last couple of years!


Sent from my iPod.
 
Dec 8, 2004
49,073
21,096
693
Maine
#3
Holy shit they just built the ones in Manchester and hooksett in the last couple of years!


Sent from my iPod.
You would think the would let them "cook" for a lot longer....
 
Jun 30, 2005
10,817
2,020
681
outsiddah Boston
#4
I live in central mass and within a 15 min drive of my house there are 5 home depots (Shrewsbury, Marlborough, Natick, Worcester, Auburn) and 4 lowes'(Westborough, Hudson, Worcester, Framingham)..I don't know how they all stay open
 
Dec 8, 2004
49,073
21,096
693
Maine
#5
Ya the HD in Newington is never busy... and there is another one (and a Lowes) like 15/20 minutes away on the other side of Portsmouth.

Guess they just want to do the Walmart model and over saturate the area... and drive smaller businesses out. I rarely go to HD as I have a smallish lumber store around the corner who has free delivery and really nice lumber etc... plus the people actually know what they are doing.
 

OilyJillFart

Well-Lubed Member
Sep 26, 2008
2,870
1,137
433
#6
I live in central mass and within a 15 min drive of my house there are 5 home depots (Shrewsbury, Marlborough, Natick, Worcester, Auburn) and 4 lowes'(Westborough, Hudson, Worcester, Framingham)..I don't know how they all stay open
I used to live west of there, HD fought for years to get a store in Greenfield, when it finally opened I would drive an extra ten miles to go there because it was nearly empty of people compared to the other three that were closer to me. It was actually pleasant to wander around looking at stuff with the whole place to myself.
 

Stig

Wackbag's New Favorite Heel
Jul 26, 2005
80,720
4,448
623
NH
#7
You would think the would let them "cook" for a lot longer....
I live in central mass and within a 15 min drive of my house there are 5 home depots (Shrewsbury, Marlborough, Natick, Worcester, Auburn) and 4 lowes'(Westborough, Hudson, Worcester, Framingham)..I don't know how they all stay open
Around here, they tried the old "Let's build our store practically across the street from the competition" business model. Which never works. Let's just say I've seen a lot of abandoned Burger Kings in my time.
 

Sinn Fein

Infidel and White Interloper
Wackbag Staff
Aug 29, 2002
31,489
2,174
818
Florida's Nature Coast
#8
Lowes > Home Depot in my experience.

The ones that I go to locally do real well. The only one I recognize on the list is Old Bridge, NJ. If I remember correctly, it was just a cunt to get in and out of that place.
 
Dec 8, 2004
49,073
21,096
693
Maine
#9
Around here, they tried the old "Let's build our store practically across the street from the competition" business model. Which never works. Let's just say I've seen a lot of abandoned Burger Kings in my time.
When I worked for a building supply (which got bought by a huge national company) they actually built a big box "Lowes Like" store that shared a parking lot with Home Depot.
 

Stig

Wackbag's New Favorite Heel
Jul 26, 2005
80,720
4,448
623
NH
#10
When I worked for a building supply (which got bought by a huge national company) they actually built a big box "Lowes Like" store that shared a parking lot with Home Depot.
Was it HQ?


Sent from my iPod.
 
Dec 8, 2004
49,073
21,096
693
Maine
#12
Was it HQ?


Sent from my iPod.
I was in Canada... It started out as Revy.... Then that company got bought out and it changed to Rona. Lowes is in Canada now really don't see how three big box stores can survive in the same market.

Oh there was a forth big box store but again Rona bought it.
 

Ballbuster1

In The Danger Zone...
Wackbag Staff
Aug 26, 2002
103,119
16,695
839
Your house, behind the couch
#13
For a city the size of Philly, they really don't have many
Lowe's stores around here. Home Depot has 10 x's the
stores in the area.
 

Sinn Fein

Infidel and White Interloper
Wackbag Staff
Aug 29, 2002
31,489
2,174
818
Florida's Nature Coast
#14
HD has been around longer of course, but Lowes is getting there.

Of the four Home Depots closest to me, three of them are located within a mile of a Lowes. The other has a Lowes about 5 miles away, in the same township.

In other parts of the Philly metro area, clearly there is a lack of Lowes stores as BB1 pointed out.
 

Ballbuster1

In The Danger Zone...
Wackbag Staff
Aug 26, 2002
103,119
16,695
839
Your house, behind the couch
#15
I have 1 Lowes store within 10 miles of me.

There are 5 Depots in the same range area.

They'll never close that Lowes cause it's always packed.
 

mascan42

Registered User
Aug 26, 2002
18,844
5,673
768
Ronkonkoma, Long Island
#17
Ya the HD in Newington is never busy... and there is another one (and a Lowes) like 15/20 minutes away on the other side of Portsmouth.

Guess they just want to do the Walmart model and over saturate the area... and drive smaller businesses out. I rarely go to HD as I have a smallish lumber store around the corner who has free delivery and really nice lumber etc... plus the people actually know what they are doing.
It's exactly the opposite around here. There are 5 Home Depots and 3 Lowes within 5 miles of my house, and every one of them is always busy.
 
Dec 8, 2004
49,073
21,096
693
Maine
#18
It's exactly the opposite around here. There are 5 Home Depots and 3 Lowes within 5 miles of my house, and every one of them is always busy.
Well the one thing about the HD not being busy is the store is actually staying clean and well stocked (for the most part).