LOWES COMPANIES INC (Form: 10-Q, Received: 05/31/2011 17:20:24)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 29, 2011

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ______

Commision file number 1-7898

LOWE'S COMPANIES, INC.

(Exact name of registrant as specified in its charter)

NORTH CAROLINA	56-0578072
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1000 Lowe's Blvd., Mooresville, NC	28117
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code	(704) 758-1000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

x Yes o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x	Accelerated filer o
Non-accelerated filer o	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

o Yes x No

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

CLASS		OUTSTANDING AT MAY 27, 2011
Common Stock, $.50 par value		1,302,069,836

LOWE’S COMPANIES, INC. - INDEX -

PART I - Financial Information		Page No.

Item 1.	Financial Statements

	Consolidated Balance Sheets - April 29, 2011 (Unaudited), April 30, 2010 (Unaudited) and January 28, 2011	3

	Consolidated Statements of Current and Retained Earnings (Unaudited) - Three months ended April 29, 2011 and April 30, 2010	4

	Consolidated Statements of Cash Flows (Unaudited) - Three months ended April 29, 2011 and April 30, 2010	5

	Notes to Consolidated Financial Statements (Unaudited)	6-12

	Report of Independent Registered Public Accounting Firm	13

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	14-19

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	20

Item 4.	Controls and Procedures	20

PART II - Other Information

Item 1A.	Risk Factors	21

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21

Item 5.	Other Information	21-23

Item 6.	Exhibits	24-25

Signature		26

Table of Contents

Part I - FINANCIAL INFORMATION
Item 1. Financial Statements

Lowe's Companies, Inc.
Consolidated Balance Sheets
In Millions, Except Par Value Data

			(Unaudited)		(Unaudited)
		April 29, 2011		April 30, 2010		January 28, 2011
Assets

Current assets:
Cash and cash equivalents		$	1,496	$	2,677	$	652
Short-term investments			345		675		471
Merchandise inventory - net			9,661		9,899		8,321
Deferred income taxes - net			232		202		193
Other current assets			239		242		330

Total current assets			11,973		13,695		9,967

Property, less accumulated depreciation			22,060		22,379		22,089
Long-term investments			1,209		832		1,008
Other assets			642		508		635

Total assets		$	35,884	$	37,414	$	33,699

Liabilities and Shareholders' Equity

Current liabilities:
Current maturities of long-term debt		$	38	$	536	$	36
Accounts payable			6,694		7,062		4,351
Accrued compensation and employee benefits			557		594		667
Deferred revenue			970		901		707
Other current liabilities			1,662		1,788		1,358

Total current liabilities			9,921		10,881		7,119

Long-term debt, excluding current maturities			6,538		5,531		6,537
Deferred income taxes - net			498		521		467
Deferred revenue - extended protection plans			650		576		631
Other liabilities			818		886		833

Total liabilities			18,425		18,395		15,587

Shareholders' equity:
Preferred stock - $5 par value, none issued			-		-		-
Common stock - $.50 par value;
Shares issued and outstanding
April 29, 2011	1,318
April 30, 2010	1,443
January 28, 2011	1,354		659		722		677
Capital in excess of par value			-		6		11
Retained earnings			16,715		18,246		17,371
Accumulated other comprehensive income			85		45		53

Total shareholders' equity			17,459		19,019		18,112

Total liabilities and shareholders' equity		$	35,884	$	37,414	$	33,699


See accompanying notes to the consolidated financial statements (unaudited).

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Lowe's Companies, Inc.
Consolidated Statements of Current and Retained Earnings (Unaudited)
In Millions, Except Per Share Data

	Three Months Ended
	April 29, 2011			April 30, 2010
Current Earnings	Amount		Percent	Amount		Percent
Net sales	$	12,185	100.00	$	12,388	100.00

Cost of sales		7,866	64.56		8,030	64.82

Gross margin		4,319	35.44		4,358	35.18

Expenses:

Selling, general and administrative		3,120	25.60		3,093	24.98

Depreciation		371	3.05		397	3.20

Interest - net		88	0.72		82	0.66

Total expenses		3,579	29.37		3,572	28.84

Pre-tax earnings		740	6.07		786	6.34

Income tax provision		279	2.28		297	2.39

Net earnings	$	461	3.79	$	489	3.95


Weighted average common shares outstanding - basic		1,324			1,438

Basic earnings per common share	$	0.35		$	0.34

Weighted average common shares outstanding - diluted		1,328			1,441

Diluted earnings per common share	$	0.34		$	0.34

Cash dividends per share	$	0.11		$	0.09


Retained Earnings
Balance at beginning of period	$	17,371		$	18,307
Net earnings		461			489
Cash dividends		(145)			(130)
Share repurchases		(972)			(420)
Balance at end of period	$	16,715		$	18,246


See accompanying notes to the consolidated financial statements (unaudited).

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Lowe's Companies, Inc.
Consolidated Statements of Cash Flows (Unaudited)
In Millions

	Three Months Ended
	April 29, 2011			April 30, 2010
Cash flows from operating activities:
Net earnings	$	461		$	489
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		397			424
Deferred income taxes		(43	)		(82	)
Loss on property and other assets - net		9			1
Share-based payment expense		30			26
Net changes in operating assets and liabilities:
Merchandise inventory - net		(1,329	)		(1,644	)
Other operating assets		106			(35	)
Accounts payable		2,339			2,773
Other operating liabilities		453			784
Net cash provided by operating activities		2,423			2,736

Cash flows from investing activities:
Purchases of investments		(627	)		(1,171	)
Proceeds from sale/maturity of investments		554			366
Increase in other long-term assets		(30	)		(1	)
Property acquired		(313	)		(283	)
Proceeds from sale of property and other long-term assets		5			5
Net cash used in investing activities		(411	)		(1,084	)

Cash flows from financing activities:
Net proceeds from issuance of long-term debt		-			992
Repayment of long-term debt		(9	)		(25	)
Proceeds from issuance of common stock under share-based payment plans		15			20
Cash dividend payments		(149	)		(131	)
Repurchase of common stock		(1,031	)		(465	)
Excess tax benefits of share-based payments		3			-
Net cash (used in) provided by financing activities		(1,171	)		391

Effect of exchange rate changes on cash		3			2

Net increase in cash and cash equivalents		844			2,045
Cash and cash equivalents, beginning of period		652			632
Cash and cash equivalents, end of period	$	1,496		$	2,677


See accompanying notes to the consolidated financial statements (unaudited).

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Lowe's Companies, Inc.

Notes to Consolidated Financial Statements (Unaudited)

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 April 29, 2011, and April 30, 2010, and the results of operations and cash flows for the three months ended April 29, 2011, and April 30, 2010.

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 28, 2011 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year.

Certain prior period amounts have been reclassified to conform to current classifications. Deferred revenue – extended protection plans, which was previously included in other liabilities (noncurrent), is now a separate line item on the consolidated balance sheets.

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 liabilities

·	Level 2 - inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly

·	Level 3 - inputs to the valuation techniques that are unobservable for the assets or liabilities

The following tables present the Company’s financial assets measured at fair value on a recurring basis as of April 29, 2011, April 30, 2010 and January 28, 2011, 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)	April 29, 2011		(Level 1)		(Level 2)		(Level 3)
Available-for-sale securities:
Municipal obligations	$	156	$	-	$	156	$	-
Money market funds		84		84		-		-
Municipal floating rate obligations		49		-		49		-
Other		2		2		-		-
Trading securities:
Mutual funds		54		54		-		-
Total short-term investments	$	345	$	140	$	205	$	-
Available-for-sale securities:
Municipal floating rate obligations	$	959	$	-	$	959	$	-
Municipal obligations		224		-		224		-
Other		26		-		26		-
Total long-term investments	$	1,209	$	-	$	1,209	$	-

			Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(In millions)	April 30, 2010		(Level 1)		(Level 2)		(Level 3)
Available-for-sale securities:
Municipal obligations	$	269	$	-	$	269	$	-
Money market funds		84		84		-		-
Municipal floating rate obligations		268		-		268		-
Other		7		2		5		-
Trading securities:
Mutual funds		47		47		-		-
Total short-term investments	$	675	$	133	$	542	$	-
Available-for-sale securities:
Municipal floating rate obligations	$	749	$	-	$	749	$	-
Municipal obligations		83		-		83		-
Total long-term investments	$	832	$	-	$	832	$	-

			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 28, 2011		(Level 1)		(Level 2)		(Level 3)
Available-for-sale securities:
Municipal obligations	$	190	$	-	$	190	$	-
Money market funds		66		66		-		-
Municipal floating rate obligations		163		-		163		-
Other		2		2		-		-
Trading securities:
Mutual funds		50		50		-		-
Total short-term investments	$	471	$	118	$	353	$	-
Available-for-sale securities:
Municipal floating rate obligations	$	765	$	-	$	765	$	-
Municipal obligations		208		-		208		-
Other		35		-		35		-
Total long-term investments	$	1,008	$	-	$	1,008	$	-

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. 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.

Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

During the three months ended April 29, 2011 and April 30, 2010, the Company had no significant measurements of assets and liabilities at fair value on a non-recurring basis subsequent to their initial recognition.

Fair Value of Financial Instruments

The Company’s financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and long-term debt and are reflected in the financial statements at cost. With the exception of long-term debt, cost approximates fair value for these items due to their short-term nature. Estimated fair values for long-term debt have been determined using available market information, including reported trades, benchmark yields and broker-dealer quotes.

Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding capitalized lease obligations, are as follows:

	April 29, 2011				April 30, 2010
	Carrying		Fair		Carrying		Fair
(In millions)	Amount		Value		Amount		Value
Long-term debt (excluding capitalized lease obligations)	$	6,214	$	6,780	$	5,712	$	6,205

Note 3: Restricted Investment Balances - Short-term and long-term investments include restricted balances pledged as collateral for the Company’s extended protection plan program and for a portion of the Company’s casualty insurance and Installed Sales program liabilities. Restricted balances included in short-term investments were $120 million at April 29, 2011, $211 million at April 30, 2010, and $102 million at January 28, 2011. Restricted balances included in long-term investments were $261 million at April 29, 2011, $177 million at April 30, 2010, and $260 million at January 28, 2011.

Note 4: Property - Property is shown net of accumulated depreciation o f $11.6 billion a t April 29, 2011, $10.2 billion at April 30, 2010, and $11.3 billion at January 28, 2011.

Note 5: Extended Protection Plans – The Company sells separately-priced extended protection plan contracts under a Lowe’s-branded program for which the Company is ultimately self-insured. The Company recognizes revenue from extended protection plan sales on a straight-line basis over the respective contract term. Extended protection plan contract terms primarily range from one to four years from the date of purchase or the end of the manufacturer’s warranty, as applicable. Changes in deferred revenue for extended protection plan contracts are summarized as follows:

	Three Months Ended
(In millions)	April 29, 2011			April 30, 2010
Deferred revenue - extended protection plans, beginning of period	$	631		$	549
Additions to deferred revenue		65			68
Deferred revenue recognized		(46	)		(41	)
Deferred revenue - extended protection plans, end of period	$	650		$	576

Incremental direct acquisition costs associated with the sale of extended protection plans are also deferred and recognized as expense on a straight-line basis over the respective contract term. Deferred costs associated with extended protection plan contracts were $163 million at April 29, 2011, $159 million at April 30, 2010, and $166 million at January 28, 2011. The Company’s extended protection plan 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 protection plan claims incurred is included in other current liabilities on the consolidated balance sheets. Changes in the liability for extended protection plan claims are summarized as follows:

		Three Months Ended
(In millions)		April 29, 2011		April 30, 2010
Liability for extended protection plan claims, beginning of period	$	20		$	23
Accrual for claims incurred		19			17
Claim payments		(20	)		(17	)
Liability for extended protection plan claims, end of period	$	19		$	23

Note 6: Shareholders' Equity - The Company has a share repurchase program that is executed through purchases made from time to time either in the open market or through private transactions. Shares purchased under the share repurchase program are retired and returned to authorized and unissued status. The Company’s Board of Directors authorized up to $5.0 billion of share repurchases on January 29, 2010 with no expiration, after the prior authorization expired on that date. As of April 29, 2011 the Company had $1.4 billion of authorization remaining under the share repurchase program.

The Company repurchased 37.9 million shares and 18.6 million shares under the share repurchase program at a total cost of $1.0 billion and $450 million for the three months ended April 29, 2011 and April 30, 2010, respectively. A reduction of $972 million and $420 million was recorded to retained earnings, after capital in excess of par value was depleted, for the three months ended April 29, 2011 and April 30, 2010, respectively. The Company also repurchased 1.3 million and 0.6 million shares from employees at a total cost of $33 million and $15 million for the three months ended April 29, 2011

and April 30, 2010, respectively, to satisfy either the exercise price of stock options exercised or the statutory withholding tax liability resulting from the vesting of restricted stock awards.

Note 7: 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 months ended April 29, 2011 and April 30, 2010.

	Three Months Ended
(In millions)	April 29, 2011		April 30, 2010
Net earnings	$	461	$	489
Foreign currency translation adjustments		31		19
Net unrealized investment gains (losses)		1		(1)
Comprehensive income	$	493	$	507

Note 8: Income Taxes - The Company is subject to examination by various foreign and domestic taxing authorities. At April 29, 2011, the Company had unrecognized tax benefits of $148 million. The Company is appealing IRS examinations for fiscal years 2004 to 2007 related to insurance deductions. It is reasonably possible this issue as well as various U.S. state issues will be settled within the next twelve months resulting in a reduction in unrecognized tax benefits of $131 million. There are currently ongoing U.S. state audits covering tax years 2002 to 2009. The Company believes appropriate provisions for all outstanding issues have been made for all jurisdictions and all open years.

Note 9: Earnings Per Share – The Company calculates basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. The Company’s participating securities consist of unvested share-based payment awards that contain a nonforfeitable right to receive dividends and therefore are considered to participate in undistributed earnings with common shareholders.

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. The following table reconciles earnings per common share for the three months ended April 29, 2011, and April 30, 2010.

	Three Months Ended
(In millions, except per share data)	April 29, 2011		April 30, 2010
Basic earnings per common share:
Net earnings	$	461	$	489
Less: Net earnings allocable to participating securities		(3)		(4)
Net earnings allocable to common shares	$	458	$	485
Weighted-average common shares outstanding		1,324		1,438
Basic earnings per common share	$	0.35	$	0.34
Diluted earnings per common share:
Net earnings	$	461	$	489
Less: Net earnings allocable to participating securities		(3)		(4)
Net earnings allocable to common shares	$	458	$	485
Weighted-average common shares outstanding		1,324		1,438
Dilutive effect of non-participating share-based awards		4		3
Weighted-average common shares, as adjusted		1,328		1,441
Diluted earnings per common share	$	0.34	$	0.34

Stock options to purchase 14.8 million and 17.2 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 April 29, 2011, and April 30, 2010, respectively.

Note 10: Supplemental Disclosure -

Net interest expense is comprised of the following:

	Three Months Ended
(In millions)	April 29, 2011			April 30, 2010
Long-term debt	$	83		$	75
Capitalized lease obligations		9			9
Interest income		(3	)		(2	)
Interest capitalized		(2	)		(3	)
Interest on tax uncertainties		(1	)		2
Other		2			1
Interest - net	$	88		$	82

Supplemental disclosures of cash flow information:

	Three Months Ended
(In millions)	April 29, 2011			April 30, 2010
Cash paid for interest, net of amount capitalized	$	171		$	130
Cash paid for income taxes	$	72		$	100
Non-cash investing and financing activities:
Non-cash property acquisitions, including assets acquired under capital lease	$	31		$	23
Loss on equity method investments	$	(2	)	$	(1	)
Cash dividends declared but not paid	$	145		$	130

Note 11: Recent Accounting Pronouncements - In May 2011, the Financial Accounting Standards Board (FASB) issued authoritative guidance that amends the existing requirements for fair value measurement and disclosure. The guidance expands the disclosure requirements around fair value measurements categorized in Level 3 of the fair value hierarchy and requires disclosure of the level in the fair value hierarchy of items that are not measured at fair value in the statement of financial position but whose fair value must be disclosed. It also clarifies and expands upon existing requirements for measurement of the fair value of financial assets and liabilities as well as instruments classified in shareholder’s equity. The guidance is effective for fiscal years beginning after December 15, 2011. The Company is currently evaluating the impact of the adoption of the guidance on its consolidated financial statements.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Lowe’s Companies, Inc.

Mooresville, North Carolina

We have reviewed the accompanying consolidated balance sheets of Lowe’s Companies, Inc. and subsidiaries (the “Company”) as of April 29, 2011 and April 30, 2010, and the related consolidated statements of current and retained earnings and of cash flows for the fiscal three-month periods ended April 29, 2011 and April 30, 2010. These consolidated interim financial statements are the responsibility of the Company’s management.

We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should be made to such consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of the Company as of January 28, 2011, and the related consolidated statements of earnings, shareholders’ equity, and cash flows for the fiscal year then ended (not presented herein); and in our report dated March 28, 2011, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet of the Company as of January 28, 2011 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ DELOITTE & TOUCHE LLP

Charlotte, North Carolina

May 31, 2011

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Item 2 -

MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion and analysis summarizes the significant factors affecting our consolidated operating results, liquidity and capital resources during the three months ended April 29, 2011, and April 30, 2010. This discussion and analysis should be read in conjunction with the consolidated financial statements and notes to the consolidated financial statements that are included in our Annual Report on Form 10-K for the fiscal year ended January 28, 2011 (the Annual Report), as well as the consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) contained in this report. Unless otherwise specified, all comparisons made are to the corresponding period of 2010. This discussion and analysis is presented in six sections:

·	Executive Overview

·	Operations

·	Company Outlook

·	Financial Condition, Liquidity and Capital Resources

·	Off-Balance Sheet Arrangements

·	Contractual Obligations and Commercial Commitments

·	Critical Accounting Policies and Estimates

EXECUTIVE OVERVIEW

Although the overall economy is showing gradual signs of recovery, uncertainty remains. Consumers may feel better about their employment situation, but are uneasy due to higher fuel, clothing and food costs, as well as geopolitical issues around the world. In our first quarter consumer survey, homeowners cited rising gas and energy prices followed by the state of the overall economy and inflation in general as the top factors affecting their spending plans. Additionally, as we have seen over the past several quarters, consumers remained cautious with large ticket discretionary spending on their homes as decreasing home prices and low housing turnover created uncertainty about the value of their homes.

In addition to ongoing economic pressures, we faced difficult first quarter comparisons, as last year’s government stimulus programs such as Cash for Appliances and the Homebuyer Tax Credit, as well as favorable weather, drove strong results in the first quarter of 2010. This was compounded by the negative impact of unseasonably cold, wet weather in the northern U.S. during the first quarter of 2011 as well as severe storms in the southern part of the country during the latter part of the quarter. Overall, comparable store sales decreased 3.3% during the first quarter, with an increase of 2.7% in February, a decrease of 1.9% in March and a decrease of 8.3% in April, versus the same periods from the prior year. The weather’s impact was also reflected by performance well below the company average in outdoor product categories, compared to comparable store sales performance above the company average in most indoor categories during the quarter.

While our overall performance for the first quarter was below our expectations, we continued to focus on programs to close more sales and build average ticket. During the quarter, we hired to staff our weekend teams, which provide additional customer-facing hours in our stores from Friday through Sunday. Additionally, we realigned our media spending during the quarter, placing more emphasis in online media to reach more customers per advertising dollar spent. We also focused on managing inventory levels, and our ending first quarter 2011 inventory was 2.4% lower than the first quarter of 2010. However, we are confident that we have the right inventory to meet customer demand. In addition, we expect to take advantage of delayed seasonal opportunities in the second quarter to sell through this inventory and avoid significant markdowns.

Looking forward, we launched several additional programs during the first quarter aimed at driving operating results. For example, we entered into a gift card mall program with a third party, under which our gift cards are available for purchase in grocery stores and other high volume retail channels. We expect this program to significantly increase our total gift card sales. Additionally, we launched a program at the end of April that provides Lowe’s consumer credit card holders with a 5% discount every day. In addition, for purchases of $299 or more cardholders have the choice of no interest financing or the 5% discount. This value proposition is intended to drive customers to proprietary credit, lowering our overall cost of tender.

In addition to these specific programs, we continue to learn and improve across all facets of our day-to-day operations by adding company-wide tools and new processes to fulfill our promise to provide better customer experiences.

OPERATIONS

The following table sets forth the percentage relationship to net sales of each line item of the consolidated statements of earnings, as well as the percentage change in dollar amounts from the prior period. This table should be read in conjunction with the following discussion and analysis and the consolidated financial statements (unaudited), including the related notes to the consolidated financial statements (unaudited).

	Three Months Ended				Basis Point Increase / (Decrease) in Percentage of Net Sales from Prior Period	Percentage Increase / (Decrease) in Dollar Amounts from Prior Period
	April 29, 2011		April 30, 2010		2011 vs. 2010	2011 vs. 2010
Net sales	100.00	%	100.00	%	N/A	(1.6)	%
Gross margin	35.44		35.18		26	(0.9)
Expenses:
Selling, general and administrative	25.60		24.98		62	0.8
Depreciation	3.05		3.20		(15)	(6.5)
Interest - net	0.72		0.66		6	7.5
Total expenses	29.37		28.84		53	0.2
Pre-tax earnings	6.07		6.34		(27)	(5.8)
Income tax provision	2.28		2.39		(11)	(6.1)
Net earnings	3.79	%	3.95	%	(16)	(5.7)
EBIT margin 1	6.79	%	7.00	%	(21)	(4.6)	%

	Three Months Ended
Other Metrics	April 29, 2011		April 30, 2010
Comparable store sales (decrease)/increase 2	(3.3)	%	2.4	%
Total customer transactions (in millions)	195		199
Average ticket 3	$ 62.51		$ 62.27

At end of period:
Number of stores	1,751		1,721
Sales floor square feet (in millions)	197		194
Average store size selling square feet (in thousands) 4	113		113

1	EBIT margin, also referred to as operating margin, is defined as earnings before interest and taxes as a percentage of sales.

2	A comparable store is defined as a store that has been open longer than 13 months. A store that is identified for relocation is no longer considered comparable one month prior to its relocation. The relocated store must then remain open longer than 13 months to be considered comparable.

3	Average ticket is defined as net sales divided by the total number of customer transactions.

4 Average store size selling square feet is defined as sales floor square feet divided by the number of stores open at the end of the period.

Net Sales – Net sales decreased 1.6% to $12.2 billion in the first quarter of 2011 driven by a decrease in total customer count of 2.1%, offset slightly by an increase in average ticket of 0.5%. Comparable store sales decreased 3.3% over the same period, driven by a decrease in comparable store customer count.

Sales during the first quarter were impacted by ongoing economic pressures, unfavorable weather conditions and difficult comparisons to prior year government stimulus programs. Unseasonably cold, wet weather in the northern U.S. accounted for performance below the company average in the northeast and north central areas of the country in the first quarter of 2011. In addition, severe storms and widespread flooding throughout the country negatively impacted sales. From a product category perspective, the weather drove below-average comparable store sales changes in outdoor categories such as outdoor power equipment, nursery, lawn & landscape products, lumber and building materials. Comparisons to prior year government stimulus programs, such as expiring energy tax credits and the Cash for Appliances program, led to comparable store sales performance below the company average in both millwork and appliances.

Comparable store sales were above the company average for the quarter in the following product categories: rough electrical; rough plumbing; cabinets & countertops; tools; lighting; paint; flooring; home fashions, storage and cleaning; fashion plumbing and hardware. In addition, seasonal living performed at approximately the overall company average for the quarter. Many of the products in these categories are indoor products and therefore were less affected by the negative weather conditions during the quarter. Rough plumbing benefitted from wet weather as pumps & tanks and air filters sold particularly well. Inflation drove high single-digit comparable store sales in rough electrical and helped paint maintain flat comparable store sales, overcoming slow sales of exterior stains, sealers and applicators. Cabinets & countertops also performed well driven by strong performance in special order kitchen cabinets, which helped drive positive low-single digit comparable store sales performance in Installed Sales. Installed Sales also benefitted from improved special order lead times in appliances and continued positive customer responses to Stainmaster® carpet.

Gross Margin - For the first quarter of 2011, gross margin increased by 26 basis points as a percentage of sales, driven by 34 basis points of margin rate improvement and 28 basis points of improvement related to mix of products sold. Our Base Price Optimization strategy and our increased number of competitive pricing zones implemented in the second half of 2010 accounted for approximately 25 basis points of the margin rate improvement. The mix of products sold across categories positively impacted gross margin primarily due to the decreased proportion of sales in appliances and outdoor power equipment and the increased proportion of sales in rough plumbing. These improvements were offset by de-leverage in distribution expenses, primarily related to increased fuel costs.

SG&A - For the first quarter of 2011, SG&A expense increased less than 1% and increased 62 basis points as a percentage of sales compared to the first quarter of 2010. The de-leverage is partially attributable to the decrease in sales from the prior year. Insurance costs, including casualty and employee insurance, de-leveraged 32 basis points primarily related to workers’ compensation costs. We also experienced approximately 15 basis points of de-leverage related to investments during the quarter in our strategic initiatives due to increased corporate headcount and contract labor expense. Advertising expenses de-leveraged nine basis points as a result of timing of advertising spending. We also experienced de-leverage of approximately five basis points each in bank card and proprietary credit card tender costs, payroll tax expense and fleet expense. These increases were offset partially by 28 basis points of leverage in bonus expense due to a decrease in estimated attainment levels.

Depreciation - Depreciation expense decreased 6% to $371 million for the first quarter compared to the prior year due to a lower asset base resulting from decreased capital spending. Property, less accumulated depreciation, decreased to $22.1 billion at April 29, 2011 compared to $22.4 billion at April 30, 2010. As of April 29, 2011 and April 30, 2010 we owned 89% and 88% of our stores, respectively, which included stores on leased land.

Income Tax Provision - Our effective income tax rates were 37.7% and 37.8% for the three month periods ended April 29, 2011, and April 30, 2010, respectively. Our effective income tax rate was 37.7% for fiscal 2010.

COMPANY OUTLOOK

Our guidance assumes approximately $2.4 billion of share repurchases for 2011. We repurchased approximately $1.0 billion in the first quarter of 2011, with the remaining $1.4 billion expected to be spread evenly across the next three quarters.

Second Quarter 2011

As of May 16, 2011, the date of our first quarter 2011 earnings release, we expected total sales to increase approximately 4% and comparable store sales to increase approximately 2%. We expected square footage growth of approximately 1.5%. Earnings before interest and taxes as a percentage of sales (operating margin) were expected to increase approximately 20 to 30 basis points. In addition, depreciation expense was expected to be approximately $370 million. Diluted earnings per share of $0.65 to $0.69 were expected for the second quarter. All comparisons are with the second quarter of 2010.

Fiscal Year 2011

As of May 16, 2011, the date of our first quarter 2011 earnings release, we expected total sales to increase approximately 4%, which includes the 53 rd week. The 53 rd week is expected to increase sales by approximately 1.4%. We expected comparable store sales to increase 0% to 1%. We expected to open approximately 25 new stores during 2011, reflecting square footage growth of approximately 1.3%. Earnings before interest and taxes as a percentage of sales (operating margin) were expected to increase approximately 10 basis points. In addition, depreciation expense was expected to be approximately $1.47 billion. Diluted earnings per share of $1.56 to $1.64 were expected for 2011. All comparisons are with fiscal 2010, a 52-week year.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

Cash flows from operating activities continued to provide the primary source of our liquidity. The decrease in net cash provided by operating activities for the first quarter of 2011 versus the first quarter of 2010 was primarily driven by changes in working capital and the timing of income tax payments. The decrease in net cash used in investing activities for the first quarter of 2011 versus the first quarter of 2010 was driven by decreased net purchase activity related to short-term and long-term investments. Net cash used in financing activities for the first quarter of 2011 was driven primarily by $1.0 billion in share repurchases under our share repurchase program. Net cash provided by financing activities for the first quarter of 2010 was primarily attributable to approximately $1.0 billion in proceeds from the issuance of notes in April 2010, offset partially by approximately $450 million in share repurchases.

Sources of Liquidity

In addition to our cash flows from operations, liquidity is provided by our short-term borrowing facilities. We have a $1.75 billion senior credit facility that expires in June 2012. The senior credit facility supports our commercial paper program. The senior credit facility has a $500 million letter of credit sublimit. Amounts outstanding under letters of credit reduce the amount available for borrowing under the senior credit facility. Borrowings made are unsecured and are priced at fixed rates based upon market conditions at the time of funding in accordance with the terms of the senior credit facility. The senior credit facility contains certain restrictive covenants, which include maintenance of a debt leverage ratio as defined by the senior credit facility. We were in compliance with those covenants at April 29, 2011. Seventeen banking institutions are participating in the senior credit facility. As of April 29, 2011, there were no outstanding borrowings or letters of credit outstanding under the senior credit facility and no outstanding borrowings under the commercial paper program.

We also have a Canadian dollar (C$) denominated credit facility in the amount of C$50 million that provides revolving credit support for our Canadian operations. This uncommitted credit facility provides us with the ability to make unsecured borrowings which are priced at fixed rates based upon market conditions at the time of funding in accordance

with the terms of the credit facility. As of April 29, 2011, there were no outstanding borrowings under the C$ credit facility.

We expect to continue to have access to the capital markets on both short- and long-term bases when needed for liquidity purposes by issuing commercial paper or new long-term debt. The availability and the borrowing costs of these funds could be adversely affected, however, by a downgrade of our debt ratings or a deterioration of certain financial ratios. The table below reflects our debt ratings by Standard & Poor’s (S&P) and Moody’s as of May 31, 2011 , which we are disclosing to enhance understanding of our sources of liquidity and the effect of our ratings on our cost of funds. Although we currently do not expect a downgrade in our debt ratings, our commercial paper and senior debt ratings may be subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be evaluated independently of any other rating.

Debt Ratings	S&P	Moody’s
Commercial Paper	A1	P1
Senior Debt	A	A1
Outlook	Stable	Stable

We believe that net cash provided by operating and financing activities will be adequate for our expansion plans and for our other operating requirements over the next 12 months. There are no provisions in any agreements that would require early cash settlement of existing debt or leases as a result of a downgrade in our debt rating or a decrease in our stock price. In addition, we do not have a significant amount of cash held in foreign affiliates.

Cash Requirements

Capital Expenditures

Our fiscal 2011 capital expenditures forecast is approximately $1.8 billion, inclusive of approximately $100 million of lease commitments, resulting in planned net cash outflow of $1.7 billion. Approximately 40% of the planned net cash outflow is for store expansion. Our store expansion plans for 2011 consist of approximately 25 new stores and are expected to increase sales floor square footage by approximately 1.3%. All of the 2011 projects are expected to be owned, which includes approximately 20% of the stores on leased land. In addition, approximately 35% of the planned net cash outflow is for investment in our existing stores. Other planned capital expenditures include investing in our distribution and corporate infrastructure, including enhancements in information technology.

Debt and Capital

We have a share repurchase program that is executed through purchases made from time to time in the open market or through private transactions. Shares purchased under the share repurchase program are retired and returned to authorized and unissued status. As of April 29, 2011, we had a remaining repurchase authorization of approximately $1.4 billion with no expiration date. We expect to utilize the remaining authorization by the end of fiscal 2011.

On May 27, 2011, the Board of Directors declared a quarterly cash dividend of $0.14 per share, which represents a 27% increase over previously declared quarterly dividends of $0.11 per share.

OFF-BALANCE SHEET ARRANGEMENTS

Other than in connection with executing operating leases, we do not have any off-balance sheet financing that has, or is reasonably likely to have, a material, current or future effect on our financial condition, cash flows, results of operations, liquidity, capital expenditures or capital resources.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

There have been no material changes to our contractual obligations and commercial commitments outside the ordinary course of business since the end of 2010. Refer to the Annual Report on Form 10-K for additional information regarding our contractual obligations and commercial commitments.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our significant accounting policies are described in Note 1 to the consolidated financial statements presented in the Annual Report. Our critical accounting policies and estimates are described in Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Annual Report. Our significant and critical accounting policies have not changed significantly since the filing of our Annual Report.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Statements of the company's expectations for sales growth, comparable store sales, earnings and performance, capital expenditures, store openings, the housing market, the home improvement industry, demand for services, share repurchases and any statement of an assumption underlying any of the foregoing, constitute "forward-looking statements" under the Act. Such forward-looking statements are found in, among other places, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Statements containing words such as “expects,” “plans,” “strategy,” “projects,” “believes,” “opportunity,” “anticipates,” “desires,” and similar expressions are intended to highlight or indicate “forward-looking statements.” Although the company believes that the expectations, opinions, projections, and comments reflected in its forward-looking statements are reasonable, it can give no assurance that such statements will prove to be correct. A wide variety of potential risks, uncertainties, and other factors could materially affect our ability to achieve the results expressed or implied by our forward-looking statements including, but not limited to, changes in general economic conditions, such as continued high rates of unemployment, interest rate and currency fluctuations, higher fuel and other energy costs, slower growth in personal income, changes in consumer spending, changes in the rate of housing turnover, the availability and increasing regulation of consumer credit and of mortgage financing, inflation or deflation of commodity prices and other factors which can negatively affect our customers, as well as our ability to: (i) respond to adverse trends in the housing industry, such as the psychological effects of falling home prices, and in the level of repairs, remodeling, and additions to existing homes, as well as a general reduction in commercial building activity; (ii) secure, develop, and otherwise implement new technologies and processes designed to enhance our efficiency and competitiveness; (iii) attract, train, and retain highly-qualified associates; (iv) locate, secure, and successfully develop new sites for store development particularly in major metropolitan markets; (v) respond to fluctuations in the prices and availability of services, supplies, and products; (vi) respond to the growth and impact of competition; (vii) address changes in existing or new laws or regulations that affect consumer credit, employment/labor, trade, product safety, transportation/logistics, energy costs, health care, tax or environmental issues; and (viii) respond to unanticipated weather conditions that could adversely affect sales. In addition, we could experience additional impairment losses if the actual results of our operating stores are not consistent with the assumptions and judgments we have made in estimating future cash flows and determining asset fair values. For more information about these and other risks and uncertainties that we are exposed to, you should read the "Risk Factors" and "Critical Accounting Policies and Estimates" included in our Annual Report on Form 10-K to the United States Securities and Exchange Commission (the “SEC”) and the description of material changes, if any, therein included in our Quarterly Reports on Form 10-Q.

The forward-looking statements contained in this Form 10-Q are based upon data available as of the date of this report or other specified date and speak only as of such date. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf about any of the matters covered in this report are qualified by these cautionary statements and in the “Risk Factors” included in our Annual Report on Form 10-K to the SEC and the description of material changes, if any, therein included in our Quarterly Reports on Form 10-Q. We expressly disclaim any obligation to update or revise any forward-looking statement, whether as a result of new information, change in circumstances, future events, or otherwise.

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Item 3 - Quantitative and Qualitative Disclosures about Market Risk

The Company's market risk has not changed materially from that disclosed in our Annual Report on Form 10-K for the fiscal year ended January 28, 2011.

Item 4 - Controls and Procedures

The Company's management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s “disclosure controls and procedures,” (as such term is defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended, (the Exchange Act)). Based upon their evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of April 29, 2011, the Company’s disclosure controls and procedures were effective for the purpose of ensuring that the information required to be disclosed in the reports that the Company files or submits under the Exchange Act with the Securities and Exchange Commission (the SEC) (1) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

In addition, no change in the Company’s internal control over financial reporting occurred during the quarter ended April 29, 2011, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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Part II - OTHER INFORMATION

Item 1A - Risk Factors

There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K.

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

(In millions, except average price paid per share)	Total Number of Shares Purchased 1	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs 2
January 29, 2011 – February 25, 2011	2.0	$	25.35		2.0	$	2,350
February 26, 2011 – April 1, 2011	37.1		26.44		35.9		1,400
April 2, 2010 – April 29, 2011	-		-		-		1,400
As of April 29, 2011	39.1	$	26.39		37.9	$	1,400

1 During the first quarter of fiscal 2011, the Company repurchased an aggregate of 39.1 million shares of its common stock. The total number of shares purchased also includes 1.3 million shares repurchased from employees to satisfy either the exercise price of stock options or their statutory withholding tax liability upon the vesting of restricted share-based awards.

2 Authorization for up to $5 billion of share repurchases with no expiration was approved on January 29, 2010 by the Company’s Board of Directors. Although the repurchase authorization has no expiration, the Company expects to execute the program by the end of fiscal 2011 through purchases made from time to time either in the open market or through private transactions in accordance with SEC regulations.

Item 5 - Other Information

Retirement of Director – O. Temple Sloan, Jr., who reached the Board’s mandatory retirement age of 72 during his current term, retired as a director upon the expiration of his current term immediately before the Company’s annual meeting of shareholders held on May 27, 2011. Mr. Sloan has served as a director of the Company since 2004 and was the Company’s independent Lead Director from August 2008 until May 2010.

Appointment of Chairman and Chief Executive Officer as President – At the May 27, 2011 meeting of the Company’s Board of Directors, the Directors appointed Robert A. Niblock, 48, the Company’s current Chairman and Chief Executive Officer, to the additional position of President, with his appointment to be effective upon the previously-announced retirement on June 2, 2011 of the Company’s current President, Larry D. Stone. Mr. Niblock has served as Chairman of the Board and Chief Executive Officer of Lowe’s Companies, Inc., since January 2005. Prior to that, he served as President of Lowe’s from 2003 to 2006. Mr. Niblock joined Lowe’s in 1993, and during his career with the Company, has served as Vice President and Treasurer, Senior Vice President – Finance, and Executive Vice President and Chief Financial Officer. Before joining Lowe’s, Mr. Niblock had a nine-year career with accounting firm Ernst & Young. He currently serves on the board of directors of ConocoPhillips. Mr. Niblock has also been a member, since 2003, and is the immediate past Chairman of the board of directors of the Retail Industry Leaders Association (RILA), a trade association based in Arlington, VA for the retail industry that includes nine of the top 10 U.S. retailers among its members.

Shareholder Approval of 2011 Annual Incentive Plan - On May 27, 2011, the Company’s shareholders approved the Lowe’s Companies, Inc. 2011 Annual Incentive Plan (the “Annual Plan”), which the Compensation Committee of the Board of Directors adopted on March 17, 2011, subject to approval by the Company’s shareholders.

Any person who, during the term of the Annual Plan, is an employee of the Company or any subsidiary of the Company is eligible to participate under the Annual Plan. The Compensation Committee determines which employees will be participants under the Annual Plan. The Company currently anticipates that approximately 37 senior management employees will be eligible to receive awards under the Annual Plan.

Annual Plan participants will receive awards under the Annual Plan in cash after the end of a fiscal year if performance objectives established by the Compensation Committee are achieved during the fiscal year. The Compensation Committee will establish the performance objectives at the start of each fiscal year. The maximum individual award that can be made under the Annual Plan for a fiscal year is the lesser of (i) $7,000,000 or (ii) 500% of the covered employee’s base salary as of the date of grant of the award.

The Compensation Committee may amend or terminate the Annual Plan from time to time, except that no amendment will become effective until shareholder approval is obtained if the amendment would increase the maximum amount that may be payable to a covered employee for a fiscal year.

A summary description of the Annual Plan is included in the proxy statement for the Company’s Annual Meeting of Shareholders held on May 27, 2011 (the “Proxy Statement”). That summary description and this brief description of the Annual Plan are each subject, in all respects, to the terms of the Annual Plan, which is attached to the Proxy Statement as Appendix B and filed as an exhibit to this Quarterly Report on Form 10-Q.

Submission of Matters to a Vote of Security Holders - Lowe’s Companies, Inc. (the “Company”) held its annual meeting of shareholders on May 27, 2011. For more information on the proposals, see the Company’s Proxy Statement. Set forth below are the final voting results for each of the proposals.

(1) Election of Director Nominees

	VOTES FOR	VOTES WITHHELD	BROKER NON-VOTES
Raul Alvarez	1,011,192,243	6,872,021	159,332,557
David W. Bernauer	1,011,907,516	6,156,748	159,332,557
Leonard L. Berry, Ph.D.	1,008,255,933	9,808,331	159,332,557
Peter C. Browning	937,393,499	80,670,765	159,332,557
Dawn E. Hudson	992,623,074	25,441,190	159,332,557
Robert L. Johnson	825,302,193	192,762,071	159,332,557
Marshall O. Larsen	978,103,299	39,960,965	159,332,557
Richard K. Lochridge	994,304,610	23,759,654	159,332,557
Robert A. Niblock	996,774,576	21,289,688	159,332,557
Stephen F. Page	1,011,194,002	6,870,262	159,332,557

(2) Proposal to Ratify the Appointment of Deloitte & Touche LLP as Independent Registered Public Accounting Firm

VOTES FOR	VOTES AGAINST	ABSTENTIONS
1,168,272,718	7,459,745	1,664,358

(3) Proposal to Conduct an Advisory Vote on Executive Compensation

VOTES FOR	VOTES AGAINST	ABSTENTIONS	BROKER NON-VOTES
966,150,565	45,689,704	6,223,995	159,332,557

(4) Proposal to Conduct an Advisory Vote on the Frequency of Holding Future Advisory Votes on Executive Compensation

ONE YEAR	TWO YEARS	THREE YEARS	ABSTENTIONS	BROKER NON-VOTES
893,718,250	8,560,592	111,781,840	4,003,582	159,332,557

(5) Proposal To Approve the Lowe’s Companies, Inc. 2011 Annual Incentive Plan

VOTES FOR	VOTES AGAINST	ABSTENTIONS	BROKER NON-VOTES
986,225,214	26,489,236	5,349,814	159,332,557

(6) Shareholder Proposal Regarding Executive Severance Agreements

VOTES FOR	VOTES AGAINST	ABSTENTIONS	BROKER NON-VOTES
585,808,946	427,833,851	4,421,467	159,332,557

(7) Shareholder Proposal Regarding Linking Pay to Performance on Sustainability Goals

VOTES FOR	VOTES AGAINST	ABSTENTIONS	BROKER NON-VOTES
42,601,488	933,506,586	41,956,190	159,332,557

(8) Shareholder Proposal Regarding Report on Political Spending

VOTES FOR	VOTES AGAINST	ABSTENTIONS	BROKER NON-VOTES
304,286,575	539,784,311	173,993,378	159,332,557

Policy on Frequency of Say-on-Pay Vote – A majority of the votes present in person or represented by proxy and entitled to vote at the Company’s annual meeting, voted, on an advisory basis, to hold an advisory vote to approve executive compensation annually. In line with this recommendation by our shareholders, the Company will include an advisory shareholder vote on executive compensation in its proxy materials every year until the next required advisory vote on the frequency of shareholder votes on executive compensation, which will occur no later than our annual meeting of shareholders in 2017.

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Item 6 - Exhibits

Exhibit		Incorporated by Reference
Number	Exhibit Description	Form	File No.	Exhibit(s)	Filing Date

3.1	Restated and Amended Charter of Lowe's Companies, Inc.	10-Q	001-07898	3.1	September 1, 2009

3.2	Bylaws of Lowe's Companies, Inc., as amended and restated.	8-K	001-07898	3.1	November 12, 2010

10.1	Form of Lowe's Companies, Inc. Performance Share Unit Award Agreements.*‡

10.2	Lowe's Companies, Inc. 2011 Annual Incentive Plan.*	DEF 14A	001-07898	Appendix B	April 11, 2011

12.1	Statement Re Computation of Ratio of Earnings to Fixed Charges.‡

15.1	Deloitte & Touche LLP Letter Re Unaudited Interim Financial Information.‡

31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.‡

31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.‡

32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.†

32.2	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.†

101.INS	XBRL Instance Document.§

101.SCH	XBRL Taxonomy Extension Schema Document.§

101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.§

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.§

101.LAB		XBRL Taxonomy Extension Label Linkbase Document.§

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.§


*		Management contract or compensatory plan or arrangement required to be filed as an exhibit to this form.

‡		Filed herewith.

†		Furnished herewith.

§		Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		LOWE’S COMPANIES, INC.


May 31, 2011		/s/ Matthew V. Hollifield
Date		Matthew V. Hollifield
		Senior Vice President and Chief Accounting Officer

Exhibit 10.1

P E R F O R M A N C E S H A R E U N I T

A W A R D A G R E E M E N T

Non-transferable

G R A N T T O

_________________

(“ Grantee ”)

by Lowe’s Companies, Inc. (the “ Company ”) of

___________ Performance Share Units (the “ Performance Share Units ”)

pursuant to and subject to the provisions of the Lowe’s Companies, Inc. 2006 Long Term Incentive Plan (the “ Plan ”) and to the terms and conditions set forth on the following pages (the “ Terms and Conditions ”).

Unless terminated or paid earlier in accordance with the Plan or Section 3 of the Terms and Conditions, the Performance Share Units will be earned and become vested and payable to the Grantee in the form of shares of the Company’s common stock, $0.50 par value after the third anniversary of the Date of Grant based on achievement of the Performance Objectives applicable to the Performance Share Units.

IN WITNESS WHEREOF, Lowe’s Companies, Inc., acting by and through its duly authorized officer, has caused this Agreement to be executed as of the Date of Grant.

LOWE’S COMPANIES, INC.

By:

Its: Authorized Officer

Date of Grant:

Accepted by Grantee:

TERMS AND CONDITIONS

Grant of Performance Share Units . The Company hereby grants the Performance Share Units, subject to the terms and conditions set forth in the Lowe’s Companies, Inc. 2006 Long Term Incentive Plan (the “ Plan ”) and in this Agreement. The actual number of Performance Share Units earned by the Grantee shall be based on the Company’s achievement of the Performance Objectives described in Section 2 for the period beginning __________ , ____ and ending _________ , ____ (the “ Performance Period ”). Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Plan.

Performance Objective . The Performance Objective for the Performance Share Units shall be ______________.

The number of Performance Share Units earned shall be determined from the following table:

	Percentage of Performance Share Units Earned
__% or higher	_%
__%	__%
__%	__%
Less than __%	__%

The percentage of Performance Share Units earned for performance between __% and __% or between __% and __% shall be determined by linear interpolation.

3.	Distribution of Common Shares for Performance Share Units Earned .

(a)

Distribution Following Expiration of Performance Period . Unless otherwise sooner forfeited in accordance with Section 3(b) or distributed in accordance with Section 3(d), on or within 30 days after ________, _____ (the " Distribution Date "), the Company shall distribute to the Grantee one share of Common Stock for each whole Performance Share Unit earned by the Grantee in accordance with Section 2.

(b)

Termination of Employment Prior to Distribution Date . The Grantee shall forfeit all of Grantee’s right, title and interest in and to the Performance Share Units in the event Grantee’s employment with the Company terminates before the Distribution Date for any reason other than death, Disability or Retirement.

(c)

Termination Due to Death, Disability or Retirement . In the event the Grantee’s employment with the Company terminates prior to the Distribution Date due to death, Disability or Retirement, the Performance Share Units shall remain outstanding and shall be earned in accordance with Section 2 and shares of Common Stock for each whole Performance Share earned shall be distributed on or within 30 days after the Distribution Date in accordance with Section 3(a). The definition of “Retirement” for purposes of this Agreement shall have the following meaning and not the meaning assigned to such term in the Plan: The voluntary termination of employment with the approval of the Board at least six (6) months after the Date of Grant and on or after the date Grantee has attained age fifty-five (55) and Grantee’s age plus years of service equal or exceed seventy (70); provided that, Grantee has given the Board at least ten (10) days advance notice of such Retirement.

(d)

Change in Control Prior to Distribution Date . In the event a change in control of the Company (as defined in Section 409A of the Internal Revenue Code) occurs before the Distribution Date, the Performance Share Units shall be earned in accordance with Section 2 based on the achievement of the Performance Objectives through the end of the fiscal year quarter ending immediately prior to such change in control. Shares of Common Stock for each whole Performance Share Unit earned shall be distributed to the Grantee as soon as administratively practicable, but in no event later than thirty (30) days following such change in control.

4.	No Stockholder Rights . The Performance Share Units shall not entitle the Grantee to any voting, dividend or other rights as a stockholder of the Company until shares of Common Stock are distributed to Grantee in accordance with Section 3.

Competing Activity . If Grantee engages in any Competing Activity during Grantee’s employment with the Company or an Affiliate or within one year after the termination of Grantee’s employment with the Company and its Affiliates for any reason, (a) Grantee shall forfeit all of Grantee’s right, title and interest in and to any Performance Share Units as of the time of the Grantee’s engaging in such Competing Activity and such Performance Share Units shall revert to the Company immediately following such event of forfeiture, and (b) Grantee shall remit, upon demand by the Company, the Repayment Amount with respect to any shares of Common Stock that were delivered to Grantee as payment of Performance Share Units during the six (6) month period prior to the date Grantee engaged in the Competing Activity. The “ Repayment Amount ” is the aggregate Fair Market Value of the Common Stock underlying the Performance Share Units at the time of delivery to Grantee. The Repayment Amount shall be payable in cash (which shall include a certified check or bank check), by the tender of shares of Common Stock or by a combination of cash and Common Stock; provided that , regardless of the Fair Market Value of such shares at the time of tender, the tender of the shares shall satisfy the obligation to pay the Repayment Amount for the same number of shares of Common Stock delivered to the Company. For purposes of this Agreement, Participant will be deemed to be engaged in a Competing Activity if Participant, directly or indirectly, owns, manages, operates, controls, is employed by, or participates in as a 5% or greater shareholder, partner, member or joint venturer, any company which engages in the business activities of the Company or its Affiliates (the “ Business Activities ”), or engages in, as an independent contractor or otherwise, the Business Activities for himself or on behalf of another person or entity.

Nothing contained in this Section 5 shall be interpreted as or deemed to constitute a waiver of, or diminish or be in lieu of, any other rights that the Company or an Affiliate may possess as a result of Grantee’s misconduct or direct or indirect involvement with a business competing with the business of the Company or an Affiliate.

6.	No Right of Continued Employment . Nothing in this Agreement shall interfere with or limit in any way the right of the Company or any Affiliate to terminate Grantee’s employment at any time, nor confer upon Grantee any right to continue in the employ of the Company or any Affiliate.

7.	Payment of Taxes .

(a)

The Company will automatically withhold a number of shares of Common Stock having a fair market value equal to the statutory amount of any federal, state and local taxes of any kind (including Grantee’s FICA obligation) required by law to be withheld, unless Grantee notifies the Company thirty (30) days prior to the issuance of the Common Shares that he or she will satisfy his or her tax withholding obligations in cash.

(b)

If Grantee chooses to satisfy his or her tax withholding obligations in cash and complies with the above notification requirement, Grantee will, no later than the date as of which any amount related to the Performance Share Units first becomes includable in Grantee’s gross income for federal income tax purposes, pay to the Company, or make other arrangements satisfactory to the Committee regarding payment of, any federal, state and local taxes of any kind (including Grantee’s FICA obligation) required by law to be withheld with respect to such amount.

The obligations of the Company under this Agreement will be conditional on such payment or arrangements, and the Company, and, where applicable, its Affiliates will, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to Grantee.

8.	Amendment . The Committee may amend or terminate this Agreement without the consent of Grantee; provided, however, that such amendment or termination shall not, without Grantee’s consent, reduce or diminish the value of this award.

Plan Controls . The terms contained in the Plan, including without limitation the antidilution adjustment provisions, are incorporated into and made a part of this Agreement, and this Agreement shall be governed by and construed in accordance with the Plan. In the event of any actual or alleged conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall be controlling and determinative.

10.	Successors . This Agreement shall be binding upon any successor of the Company, in accordance with the terms of this Agreement and the Plan.

11.	Severability . If any one or more of the provisions contained in this Agreement are invalid, illegal or unenforceable, the other provisions of this Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included.

12.	Notice . Notices and communications under this Agreement must be in writing and either personally delivered or sent by registered or certified United States mail, return receipt requested, postage prepaid. Notices to the Company must be addressed to:

Lowe’s Companies, Inc.

1000 Lowe’s Boulevard

Mooresville, NC 28117

Attn: Senior Vice President of Employee Rewards and Services

or any other address designated by the Company in a written notice to Grantee. Notices to Grantee will be directed to the address of Grantee then currently on file with the Company, or at any other address given by Grantee in a written notice to the Company.

												Exhibit 12.1

Lowe's Companies, Inc.
Statement Re Computation of Ratio of Earnings to Fixed Charges
In Millions, Except Ratio Data

	Three Months Ended					Fiscal Years Ended On
	April 29,		April 30,			January 28,		January 29,		January 30,		February 1,		February 2,
	2011		2010			2011		2010		2009		2008		2007

Earnings:
Earnings Before Income Taxes	$	740	$	786	$	3,228	$	2,825	$	3,506	$	4,511	$	4,998
Fixed Charges		128		119		486		468		479		424		344
Capitalized Interest 1		1		-		(4)		(19)		(36)		(65)		(32)
Adjusted Earnings	$	869	$	905	$	3,710	$	3,274	$	3,949	$	4,870	$	5,310

Fixed Charges:
Interest Expense 2	$	94	$	85	$	352	$	331	$	346	$	301	$	238
Rental Expense 3		34		34		134		137		133		123		106
Total Fixed Charges	$	128	$	119	$	486	$	468	$	479	$	424	$	344


Ratio of Earnings to Fixed Charges		6.8		7.6		7.6		7.0		8.2		11.5		15.4


1 Includes the net of subtractions for interest capitalized and additions for amortization of previously-capitalized interest.

2 Interest accrued on uncertain tax positions is excluded from Interest Expense in the computation of Fixed Charges.

3 The portion of rental expense that is representative of the interest factor in these rentals.

Exhibit 15.1

May 31, 2011

Lowe’s Companies, Inc.

Mooresville, North Carolina

We have reviewed, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the unaudited consolidated interim financial information of Lowe’s Companies, Inc. and subsidiaries for the fiscal periods ended April 29, 2011 and April 30, 2010, as indicated in our report dated May 31, 2011; because we did not perform an audit, we expressed no opinion on that information.

We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended April 29, 2011, is incorporated by reference in the following Registration Statements:

Description	Registration Statement Number

Form S-3
Lowe’s Stock Advantage Direct Stock Purchase Plan	333-155748
Debt Securities, Preferred Stock, Common Stock	333-161697


Form S-8
Lowe’s 401(k) Plan	33-29772
Lowe’s Companies, Inc. 1994 Incentive Plan	33-54499
Lowe’s Companies, Inc. 1997 Incentive Plan	333-34631
Lowe’s Companies, Inc. Directors’ Stock Option Plan	333-89471
Lowe’s Companies, Inc. 2001 Incentive Plan	333-73408
Lowe’s Companies Benefit Restoration Plan	333-97811
Lowe’s Companies Cash Deferral Plan	333-114435
Lowe’s Companies, Inc. 2006 Long-Term Incentive Plan	333-138031
Lowe’s Companies Employee Stock Purchase Plan – Stock Options for Everyone	333-143266

We also are aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statements prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ DELOITTE & TOUCHE LLP

Charlotte, North Carolina

Exhibit 31.1

CERTIFICATION

I, Robert A. Niblock, certify that:

(1) I have reviewed this Quarterly Report on Form 10-Q for the quarter ended April 29, 2011 of Lowe's Companies, Inc.;

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4) The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

(5) The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

May 31, 2011		/s/ Robert A. Niblock
Date		Robert A. Niblock Chairman of the Board, President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Robert F. Hull, Jr., certify that:

(1) I have reviewed this Quarterly Report on Form 10-Q for the quarter ended April 29, 2011 of Lowe's Companies, Inc.;

(a)

(b)

(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

May 31, 2011		/s/ Robert F. Hull, Jr.
Date		Robert F. Hull, Jr., Executive Vice President and Chief Financial Officer

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Lowe's Companies, Inc. (the "Company") for the period ended April 29, 2011, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert A. Niblock, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Robert A. Niblock

Name: Robert A. Niblock

Title: Chairman of the Board, President and Chief Executive Officer

Date: May 31, 2011

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Lowe's Companies, Inc. (the "Company") for the period ended April 29, 2011, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Robert F. Hull, Jr., certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Robert F. Hull, Jr .

Name: Robert F. Hull, Jr.

Title: Executive Vice President and Chief Financial Officer

Date: May 31, 2011