News Column

Lowe's CEO Remains cautious as Economy Seesaws

June 4, 2012

Ely Portillo


The CEO of Mooresville-based Lowe's, Inc., said he's cautious about the rest of the year after Friday's unemployment increase, after the company's annual shareholder meeting Friday morning at the Ballantyne Hotel & Lodge.

"We kind of expect it to be a little tough and go, a little rocky between now and election time," said Robert Niblock, in an interview at the hotel.

Niblock said the home-improvement retailer will be positioned to ride out the uncertainty by taking advantage of expanded online offerings and better in-store technology it rolled out last year, such as iPhones for associates.

Friday's weak jobs report -- the government reported only 69,000 jobs were added in May -- wasn't unexpected, Niblock said. "As mild as the winter was, probably some advance hiring took place," he said.

The company also thinks that the worst of the decline in housing prices is behind now, Niblock said, though the number of remaining foreclosures means the U.S. still hasn't hit bottom. He doesn't expect a recovery in prices until the end of the year, or possibly early next year.

At the meeting, which was attended by the company's management, board of directors and a smattering of shareholders, Niblock reviewed Lowe's financial results. The company saw sales rise 2.9 percent in fiscal 2011, topping $50.2 billion.

But profits were down 8.5 percent, coming in at $1.8 billion. Lowe's has embarked on a $900 million technology upgrade plan and reduced its corporate headcount by about 10 percent, through buyouts, to improve results.

In contrast with other Charlotte recent shareholder meetings such as Duke Energy and Bank of America -- which drew the city's largest protest in years -- Lowe's meeting was a quiet affair. The company announced a 14 percent quarterly dividend increase, to 16 cents a share. Shareholders also voted to approve the company's executive compensation plan.

Niblock faced only one shareholder question, from a store employee who was unhappy with the ordering process for Pella windows.

The only unexpected moment came early in the meeting, after Niblock introduced the board of directors. The group includes only one woman, Dawn Hudson, vice chair of the Parthenon Group in Boston.

"You need more women!" yelled a female shareholder, from the audience.

"We'll work on that," Niblock replied.

Source: (c)2012 The Charlotte Observer (Charlotte, N.C.)

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