Lowe's reports 4Q improvement

Lowe's Companies Inc. reported another quarter of improvement as it continues some home renovations of its own.

The do-it-yourself retail chain predicted initiatives like revamped departments would propel it to the strongest sales growth it has enjoyed since before the housing bubble burst. But the strategies fueling its upswing also crimped profit outlook, as did caution about how consumers will handle conflicting economic factors.

"Certainly we've still got a lot of work to do, but we do feel like we have turned a corner," Chief Executive Robert Niblock said in an interview Monday. Lowe's is giving itself "plenty of breathing room" with its lower-than-expected profit guidance for the fiscal year, he said, because of its ongoing initiatives.

While a recovering housing market has investors flocking to the stocks of both Lowe's and larger rival Home Depot Inc., Niblock said the effect on consumers is more complex.

"From payroll tax holiday expiring to the run-up in fuel prices over the past few weeks, consumers' discretionary income has been affected," he said. Lowe's hopes that the benefit from improving home values will neutralize those challenges, he said.

The company isn't counting on outside help from housing for much sales growth this fiscal year. Of the 3.5% sales increase it expects at comparable stores, at least 3 percentage points will come from internal moves, Chief Financial Officer Robert F. Hull said on a conference call to discuss results.

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