x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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NORTH CAROLINA
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56-0578072
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1000 Lowe’s Blvd., Mooresville, NC
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28117
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code
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704-758-1000
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.50 Par Value
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New York Stock Exchange (NYSE)
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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CLASS
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OUTSTANDING AT 3/29/2019
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Common Stock, $0.50 par value
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795,922,717
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Document
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Parts Into Which Incorporated
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Portions of the Proxy Statement for Lowe’s 2019 Annual Meeting of Shareholders
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Part III
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•
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Lowe’s and the Lowe’s Foundation intends to invest $350 million in local communities through partnerships and charitable contributions.
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•
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Lowe’s will encourage employees to contribute more than three million volunteer hours to improve the communities where they live, work, and play.
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•
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Lowe’s intends to ensure all strategic suppliers have sustainability goals.
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•
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Lowe’s intends to increase the number of eco-friendly products available to customers, with the goal of helping our customers save more than $40 billion in energy costs through the sale of ENERGY STAR
®
products.
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•
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Lowe’s intends to have all wood products responsibly sourced.
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Name
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Age
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Title
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Marvin R. Ellison
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54
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President and Chief Executive Officer since July 2018; Chairman of the Board and Chief Executive Officer, J.C. Penney Company, Inc. (a department store retailer), 2016 – June 2018; Chief Executive Officer, J.C. Penney Company, Inc., 2015 – 2016; President, J.C. Penney Company, Inc., 2014 – 2015; Executive Vice President – U.S. Stores, The Home Depot, Inc. (a home improvement retailer) 2008 – 2014.
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William P. Boltz
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56
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Executive Vice President, Merchandising since August 2018; President and CEO, Chervon North America (a global power tool supplier), 2015-2018; President and owner of The Boltz Group, LLC (a retail consulting firm), 2013 – 2015; Senior Vice President, Merchandising, The Home Depot, Inc. (a home improvement retailer), 2006 – 2012.
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David M. Denton
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53
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Executive Vice President and Chief Financial Officer since November 2018; Executive Vice President and Chief Financial Officer, CVS Health Corporation (a pharmacy innovation company), 2010 – November 2018.
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|
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Donald E. Frieson
|
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60
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|
Executive Vice President, Supply Chain since August 2018; Executive Vice President, Operations, Sam’s Club (a general merchandise retailer), 2014 – 2017; Senior Vice President, Replenishment, Planning and Real Estate, Sam’s Club, 2012 – 2014.
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Seemantini Godbole
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49
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Executive Vice President, Chief Information Officer since November 2018; Senior Vice President, Technology and Digital, Target Corporation (a department store retailer), January 2017 – November 2018; Vice President, Technology and Digital, Target Corporation, 2013 – December 2016.
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Matthew V. Hollifield
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52
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Senior Vice President and Chief Accounting Officer since 2005.
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Ross W. McCanless
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61
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Executive Vice President, General Counsel and Corporate Secretary since 2017; Chief Legal Officer, Secretary and Chief Compliance Officer, 2016 –
2017; General Counsel, Secretary and Chief Compliance Officer, 2015 – 2016; Chief Legal Officer, Extended Stay America, Inc. (a hotel operating company) and ESH Hospitality, Inc. (a hotel real estate investment company), 2013 – 2014.
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Joseph M. McFarland III
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49
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Executive Vice President, Stores since August 2018; Executive Vice President and Chief Customer Officer, J.C. Penney Company, Inc. (a department store retailer), March 2018 – August 2018; Executive Vice President, Stores, J.C. Penney Company, Inc., 2016 – March 2018; Divisional President, The Home Depot, Inc. (a home improvement retailer), 2007 – 2015.
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Jennifer L. Weber
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52
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Executive Vice President and Chief Human Resources Officer since 2016; Executive Vice President, External Affairs and Strategic Policy, Duke Energy Corporation (an electric power company), 2014 – 2016; Executive Vice President and Chief Human Resources Officer, Duke Energy Corporation, 2011 – 2014.
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1/31/2014
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1/30/2015
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1/29/2016
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2/3/2017
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2/2/2018
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2/1/2019
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||||||
Lowe’s
|
$
|
100.00
|
|
|
$
|
148.79
|
|
|
$
|
159.77
|
|
|
$
|
166.32
|
|
|
$
|
234.64
|
|
|
$
|
228.98
|
|
S&P 500
|
100.00
|
|
|
114.22
|
|
|
113.46
|
|
|
137.36
|
|
|
168.46
|
|
|
168.36
|
|
||||||
S&P Retail Index
|
$
|
100.00
|
|
|
$
|
118.75
|
|
|
$
|
137.22
|
|
|
$
|
159.62
|
|
|
$
|
225.15
|
|
|
$
|
241.71
|
|
|
Total Number of
Shares Purchased
1
|
|
|
Average Price
Paid per Share
|
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
2
|
|
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Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
2
|
|
||
November 3, 2018 – November 30, 2018
3
|
3,421,699
|
|
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$
|
90.33
|
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|
3,421,143
|
|
|
$
|
4,123,763,667
|
|
December 1, 2018 – January 4, 2019
|
1,159,359
|
|
|
91.19
|
|
|
1,059,707
|
|
|
14,027,232,040
|
|
||
January 5, 2019 – February 1, 2019
|
872,707
|
|
|
94.56
|
|
|
872,036
|
|
|
13,944,777,229
|
|
||
As of February 1, 2019
|
5,453,765
|
|
|
$
|
91.19
|
|
|
5,352,886
|
|
|
$
|
13,944,777,229
|
|
1
|
The total number of shares purchased includes shares withheld from employees to satisfy either the exercise price of stock options or the statutory withholding tax liability upon the vesting of share-based awards.
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2
|
On January 26, 2018, the Company announced that its Board of Directors authorized $5.0 billion of share repurchases with no expiration. On December 12, 2018, the Company announced that its Board of Directors authorized an additional $10.0 billion of share repurchases with no expiration.
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3
|
In November 2018, the Company entered into an Accelerated Share Repurchase (ASR) agreement with a third-party financial institution to repurchase $270 million of the Company’s common stock. Pursuant to the agreement, the Company paid $270 million to the financial institution and received an initial delivery of 2.6 million shares. Subsequent to the end of the fourth quarter, in February 2019, the Company finalized the transaction and received an additional 0.3 million shares. The average price paid per share reflected in the table above was derived using the fair market value of the shares on the date the initial 2.6 million shares were delivered. See Note
11
to the consolidated financial statements included herein for additional information regarding share repurchases.
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Selected Statement of Earnings Data
(In millions, except per share data)
|
2018
1, 2
|
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2017
2
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|
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2016
2, 3, 4
|
|
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2015
2
|
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2014
2
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|
|||||
Net sales
|
$
|
71,309
|
|
|
$
|
68,619
|
|
|
$
|
65,017
|
|
|
$
|
59,074
|
|
|
$
|
56,223
|
|
Gross margin
|
22,908
|
|
|
22,434
|
|
|
21,674
|
|
|
19,933
|
|
|
18,987
|
|
|||||
Operating income
|
4,018
|
|
|
6,586
|
|
|
5,846
|
|
|
4,971
|
|
|
4,792
|
|
|||||
Net earnings
|
2,314
|
|
|
3,447
|
|
|
3,093
|
|
|
2,546
|
|
|
2,698
|
|
|||||
Basic earnings per common share
|
2.84
|
|
|
4.09
|
|
|
3.48
|
|
|
2.73
|
|
|
2.71
|
|
|||||
Diluted earnings per common share
|
2.84
|
|
|
4.09
|
|
|
3.47
|
|
|
2.73
|
|
|
2.71
|
|
|||||
Dividends per share
|
$
|
1.85
|
|
|
$
|
1.58
|
|
|
$
|
1.33
|
|
|
$
|
1.07
|
|
|
$
|
0.87
|
|
Selected Balance Sheet Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
34,508
|
|
|
$
|
35,291
|
|
|
$
|
34,408
|
|
|
$
|
31,266
|
|
|
$
|
31,721
|
|
Long-term debt, excluding current maturities
|
$
|
14,391
|
|
|
$
|
15,564
|
|
|
$
|
14,394
|
|
|
$
|
11,545
|
|
|
$
|
10,806
|
|
1
|
Effective February 3, 2018, the Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), and all related amendments, using the modified retrospective method. Therefore, results for reporting periods beginning after February 2, 2018 are presented under ASU 2014-09, while comparative prior period amounts have not been restated and continue to be presented under accounting standards in effect in those periods. See Note 1 to the consolidated financial statements for additional information on the impacts of adopting this new revenue recognition guidance.
|
2
|
In the fourth quarter of fiscal
2018
, the Company changed its method of accounting for shipping and handling costs from the Company’s stores, distribution centers, and other locations to customers. Under the new accounting principle, shipping and handling costs related to the delivery of products from the Company to customers are included in cost of sales, whereas they were previously presented in selling, general, and administrative expense, and depreciation and amortization. Amounts presented for fiscal years 2018, 2017, 2016, 2015, and 2014 reflect adjusted amounts in accordance with this accounting principle change. See Note
2
to the consolidated financial statements included herein for additional information on the accounting principle change.
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3
|
Fiscal 2016 contained 53 weeks, while all other years contained 52 weeks.
|
4
|
Fiscal 2016 includes the acquisition of RONA inc. See Note
4
to the consolidated financial statements included in this Annual Report.
|
•
|
Executive Overview
|
•
|
Operations
|
•
|
Financial Condition, Liquidity and Capital Resources
|
•
|
Off-Balance Sheet Arrangements
|
•
|
Contractual Obligations and Commercial Commitments
|
•
|
Critical Accounting Policies and Estimates
|
|
|
|
Basis Point Increase / (Decrease) in
Percentage of Net Sales from
Prior Year
1
|
|
|
Percentage Increase / (Decrease) in Dollar Amounts from Prior Year
1
|
|
||
|
2018
2
|
|
2017
2
|
|
2018 vs. 2017
|
|
|
2018 vs. 2017
|
|
Net sales
|
100.00%
|
|
100.00%
|
|
N/A
|
|
|
3.9
|
%
|
Gross margin
|
32.12
|
|
32.69
|
|
(57
|
)
|
|
2.1
|
|
Expenses:
|
|
|
|
|
|
|
|
||
Selling, general and administrative
|
24.41
|
|
21.04
|
|
337
|
|
|
20.6
|
|
Depreciation and amortization
|
2.07
|
|
2.05
|
|
2
|
|
|
5.2
|
|
Operating income
|
5.64
|
|
9.60
|
|
(396
|
)
|
|
(39.0
|
)
|
Interest - net
|
0.88
|
|
0.92
|
|
(4
|
)
|
|
(1.3
|
)
|
Loss on extinguishment of debt
|
—
|
|
0.68
|
|
(68
|
)
|
|
(100.0
|
)
|
Pre-tax earnings
|
4.76
|
|
8.00
|
|
(324
|
)
|
|
(38.2
|
)
|
Income tax provision
|
1.52
|
|
2.98
|
|
(146
|
)
|
|
(47.1
|
)
|
Net earnings
|
3.24%
|
|
5.02%
|
|
(178
|
)
|
|
(32.9
|
)%
|
|
|
|
|
|
|
|
|
||
|
|
|
Basis Point Increase / (Decrease) in
Percentage of Net Sales from Prior Year
1
|
|
|
Percentage Increase / (Decrease) in Dollar Amounts from Prior Year
1
|
|
||
|
2017
2
|
|
2016
2
|
|
2017 vs. 2016
|
|
|
2017 vs. 2016
|
|
Net sales
|
100.00%
|
|
100.00%
|
|
N/A
|
|
|
5.5
|
%
|
Gross margin
|
32.69
|
|
33.34
|
|
(65
|
)
|
|
3.5
|
|
Expenses:
|
|
|
|
|
|
|
|
||
Selling, general and administrative
|
21.04
|
|
22.12
|
|
(108
|
)
|
|
0.5
|
|
Depreciation and amortization
|
2.05
|
|
2.23
|
|
(18
|
)
|
|
(3.4
|
)
|
Operating income
|
9.60
|
|
8.99
|
|
61
|
|
|
12.6
|
|
Interest - net
|
0.92
|
|
0.99
|
|
(7
|
)
|
|
(2.0
|
)
|
Loss on extinguishment of debt
|
0.68
|
|
—
|
|
68
|
|
|
N/A
|
|
Pre-tax earnings
|
8.00
|
|
8.00
|
|
—
|
|
|
5.5
|
|
Income tax provision
|
2.98
|
|
3.24
|
|
(26
|
)
|
|
(3.2
|
)
|
Net earnings
|
5.02%
|
|
4.76%
|
|
26
|
|
|
11.5
|
%
|
1
|
The fiscal year ended February 3, 2017 had 53 weeks. The fiscal years ended February 1, 2019 and February 2, 2018 had 52 weeks.
|
2
|
In the fourth quarter of fiscal
2018
, we changed our method of accounting for shipping and handling costs from the Company’s stores, distribution centers, and other locations to customers. Under the new accounting principle, shipping and handling costs related to the delivery of products from the Company to customers are included in costs of sales, whereas they were previously included in selling, general, and administrative expense, and depreciation and amortization. Amounts presented for fiscal years 2018, 2017, and 2016 reflect adjusted amounts in accordance with this accounting principle change.
|
Other Metrics
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Comparable sales increase
2
|
2.4
|
%
|
|
4.0
|
%
|
|
4.2
|
%
|
|||
Total customer transactions (in millions)
1
|
941
|
|
|
953
|
|
|
945
|
|
|||
Average ticket
3
|
$
|
75.79
|
|
|
$
|
72.00
|
|
|
$
|
68.83
|
|
At end of year:
|
|
|
|
|
|
||||||
Number of stores
|
2,015
|
|
|
2,152
|
|
|
2,129
|
|
|||
Sales floor square feet (in millions)
|
209
|
|
|
215
|
|
|
213
|
|
|||
Average store size selling square feet (in thousands)
4
|
104
|
|
|
100
|
|
|
100
|
|
|||
Return on average assets
5
|
6.4
|
%
|
|
9.5
|
%
|
|
8.9
|
%
|
|||
Return on average shareholders’ equity
6
|
43.8
|
%
|
|
59.2
|
%
|
|
44.4
|
%
|
|||
Return on invested capital
7
|
12.8
|
%
|
|
18.8
|
%
|
|
15.8
|
%
|
1
|
The fiscal year ended February 3, 2017 had 53 weeks. The fiscal years ended February 1, 2019 and February 2, 2018 had 52 weeks.
|
2
|
A comparable location is defined as a retail location that has been open longer than 13 months. A location that is identified for relocation is no longer considered comparable in the month of its relocation. The relocated location must then remain open longer than 13 months to be considered comparable. A location we have decided to exit is no longer considered comparable as of the beginning of the month in which we announce its exit. Acquired locations are included in the comparable sales calculation beginning in the first full month following the first anniversary of the date of the acquisition. Comparable sales include online sales, which positively impacted fiscal 2018 and fiscal 2017 by approximately 80 basis points and 120 basis points, respectively. Online sales did not have a meaningful impact on fiscal 2016. The comparable store sales calculation for fiscal 2016 included in the preceding table was calculated using sales for a comparable 53-week period.
|
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. The average Lowe’s-branded home improvement store has approximately 112,000 square feet of retail selling space.
|
5
|
Return on average assets is defined as net earnings divided by average total assets for the last five quarters.
|
6
|
Return on average shareholders’ equity is defined as net earnings divided by average shareholders’ equity for the last five quarters.
|
7
|
Return on invested capital is a non-GAAP financial measure. See below for additional information and a reconciliation to the most comparable GAAP measure.
|
(In millions, except percentage data)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Calculation of Return on Invested Capital
|
|
|
|
|
|
||||||
Numerator
|
|
|
|
|
|
||||||
Net earnings
|
$
|
2,314
|
|
|
$
|
3,447
|
|
|
$
|
3,093
|
|
Plus:
|
|
|
|
|
|
||||||
Interest expense - net
|
624
|
|
|
633
|
|
|
645
|
|
|||
Loss on extinguishment of debt
|
—
|
|
|
464
|
|
|
—
|
|
|||
Provision for income taxes
|
1,080
|
|
|
2,042
|
|
|
2,108
|
|
|||
Net operating profit
|
4,018
|
|
|
6,586
|
|
|
5,846
|
|
|||
Less:
|
|
|
|
|
|
||||||
Income tax adjustment
1
|
1,278
|
|
|
2,450
|
|
|
2,370
|
|
|||
Net operating profit after tax
|
$
|
2,740
|
|
|
$
|
4,136
|
|
|
$
|
3,476
|
|
|
|
|
|
|
|
||||||
Denominator
|
|
|
|
|
|
||||||
Average debt and equity
2
|
$
|
21,381
|
|
|
$
|
21,999
|
|
|
$
|
21,958
|
|
|
|
|
|
|
|
||||||
Return on invested capital
|
12.8
|
%
|
|
18.8
|
%
|
|
15.8
|
%
|
1
|
Income tax adjustment is defined as net operating profit multiplied by the effective tax rate, which was
31.8%
,
37.2%
, and
40.5%
for
2018
,
2017
, and
2016
, respectively.
|
2
|
Average debt and equity is defined as average debt, including current maturities and short-term borrowings, plus total equity for the last five quarters.
|
|
2018
|
|
2017
|
||||||||||||||||
|
Pre-Tax Earnings
|
|
Tax
|
|
Net Earnings
|
|
Pre-Tax Earnings
|
|
Tax
|
|
Net Earnings
|
||||||||
Diluted earnings per share, as reported
|
|
|
|
|
$
|
2.84
|
|
|
|
|
|
|
$
|
4.09
|
|
||||
Non-GAAP Adjustments - per share impacts
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Canadian goodwill impairment
1
|
1.17
|
|
|
(0.03
|
)
|
|
1.14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Orchard Supply Hardware charges
2
|
0.68
|
|
|
(0.17
|
)
|
|
0.51
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
U.S. & Canada charges
3
|
0.33
|
|
|
(0.08
|
)
|
|
0.25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Mexico impairment charges
4
|
0.30
|
|
|
0.01
|
|
|
0.31
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Non-core activities charges
5
|
0.06
|
|
|
(0.02
|
)
|
|
0.04
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Project Specialists Interiors charge
6
|
0.02
|
|
|
—
|
|
|
0.02
|
|
|
|
|
|
|
|
|||||
Impact of tax reform
7
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.02
|
|
|
0.02
|
|
||
One-time cash bonus attributable to tax reform
8
|
—
|
|
|
—
|
|
|
—
|
|
|
0.08
|
|
|
(0.03
|
)
|
|
0.05
|
|
||
Gain on sale of interest in Australian joint venture
9
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.11
|
)
|
|
—
|
|
|
(0.11
|
)
|
||
Loss on extinguishment of debt
10
|
—
|
|
|
—
|
|
|
—
|
|
|
0.55
|
|
|
(0.21
|
)
|
|
0.34
|
|
||
Adjusted diluted earnings per share
|
|
|
|
|
$
|
5.11
|
|
|
|
|
|
|
$
|
4.39
|
|
1
|
Represents costs associated with the goodwill impairment of the Company’s Canadian operations. The majority of the charge was non-deductible for tax purposes, and therefore, had an insignificant tax impact.
|
2
|
Represents costs associated with the Company’s decision to close all Orchard Supply Hardware locations as part of a strategic reassessment of our business. Costs included long-lived asset impairments, discontinued projects, accelerated depreciation and amortization, severance and lease obligation costs.
|
3
|
Represents costs associated with the Company’s decision to close 20 U.S. stores and 31 stores and other locations in Canada during 2018 as part of a strategic reassessment of our business. Costs included long-lived asset impairments, accelerated depreciation and amortization, severance and lease obligation costs.
|
4
|
Represents impairment charges associated with the Company’s decision to exit its retail operations in Mexico as part of a strategic reassessment of our business. This decision resulted in negative tax impacts associated with the re-capture of previously deducted operating losses and other non-deductible amounts.
|
5
|
Represents costs associated with the Company’s decision to exit certain non-core activities within its U.S. home improvement business as part of a strategic reassessment of our business. Costs included long-lived asset impairment, severance and lease obligation costs, and inventory write-down.
|
6
|
Represents severance obligations associated with the elimination of the Project Specialists Interiors position as part of a strategic reassessment of our business.
|
7
|
Represents the net impact related to the passage of the Tax Cuts and Jobs Act of 2017.
|
8
|
Represents the one-time cash bonus for eligible hourly employees attributable to the passage of the Tax Cuts and Jobs Act of 2017.
|
9
|
Represents the gain from the sale of the Company’s interest in its Australian joint venture with Woolworths. This gain had no impact on the Company’s income tax provision due to the reduction of a previously established deferred tax valuation allowance.
|
10
|
Represents the loss on extinguishment of debt in connection with a $1.6 billion cash tender offer.
|
•
|
66 basis points of deleverage due to the closing of all Orchard Supply Hardware locations, associated with long-lived asset impairments and discontinued projects, severance and lease obligation costs;
|
•
|
35 basis points of deleverage related to the decision to exit retail operations in Mexico, associated with impairment charges;
|
•
|
31 basis points of deleverage due to the closing of 20 under-performing stores in the U.S. and 31 Canadian stores and other locations, associated with long-lived asset impairment, severance and lease obligation costs, and;
|
•
|
Four basis points of deleverage due to the exit of certain non-core activities and the elimination of the Project Specialists Interiors position.
|
•
|
144 basis points of deleverage related to the decision to exit retail operations in Mexico, associated with impairment charges;
|
•
|
135 basis points of deleverage due to the closing of all Orchard Supply Hardware locations, associated with lease obligations costs;
|
•
|
64 basis points of deleverage due to the closing of 20 under-performing stores in the U.S. and 31 Canadian stores and other locations, associated with severance and lease obligation costs, and;
|
•
|
10 basis points of deleverage due to the exit of certain non-core activities and the elimination of the Project Specialists.
|
(In millions)
|
2018
|
|
|
2017
|
|
||
Interest expense, net of amount capitalized
|
$
|
642
|
|
|
$
|
638
|
|
Amortization of original issue discount and loan costs
|
10
|
|
|
11
|
|
||
Interest income
|
(28
|
)
|
|
(16
|
)
|
||
Interest - net
|
$
|
624
|
|
|
$
|
633
|
|
(In millions)
|
2017
|
|
|
2016
|
|
||
Interest expense, net of amount capitalized
|
$
|
638
|
|
|
$
|
647
|
|
Amortization of original issue discount and loan costs
|
11
|
|
|
10
|
|
||
Interest income
|
(16
|
)
|
|
(12
|
)
|
||
Interest - net
|
$
|
633
|
|
|
$
|
645
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Net cash provided by operating activities
|
$
|
6,193
|
|
|
$
|
5,065
|
|
|
$
|
5,617
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Net cash used in investing activities
|
$
|
(1,080
|
)
|
|
$
|
(1,441
|
)
|
|
$
|
(3,361
|
)
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
Existing store investments ¹
|
60
|
%
|
|
50
|
%
|
|
55
|
%
|
Strategic initiatives ²
|
20
|
%
|
|
10
|
%
|
|
10
|
%
|
New stores and international
3
|
20
|
%
|
|
40
|
%
|
|
35
|
%
|
Total capital expenditures
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
|
|
|
2019
|
|
Existing store investments
|
|
65
|
%
|
Strategic initiatives
|
|
20
|
%
|
New stores and international
|
|
15
|
%
|
|
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Net cash used in financing activities
|
$
|
(5,124
|
)
|
|
$
|
(3,607
|
)
|
|
$
|
(2,092
|
)
|
(In millions, except for interest rate data)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Net change in short-term borrowings
|
$
|
(415
|
)
|
|
$
|
625
|
|
|
$
|
466
|
|
Amount outstanding at year-end
|
$
|
722
|
|
|
$
|
1,137
|
|
|
$
|
510
|
|
Maximum amount outstanding at any month-end
|
$
|
892
|
|
|
$
|
1,137
|
|
|
$
|
658
|
|
Weighted-average interest rate of short-term borrowings outstanding
|
2.81
|
%
|
|
1.85
|
%
|
|
1.01
|
%
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Net proceeds from issuance of long-term debt
|
$
|
—
|
|
|
$
|
2,968
|
|
|
$
|
3,267
|
|
Repayment of long-term debt
|
$
|
(326
|
)
|
|
$
|
(2,849
|
)
|
|
$
|
(1,173
|
)
|
(In millions, except per share data)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Total amount paid for share repurchases
|
$
|
3,037
|
|
|
$
|
3,192
|
|
|
$
|
3,595
|
|
Total number of shares repurchased
|
31.6
|
|
|
39.9
|
|
|
48.0
|
|
|||
Average price paid per share
|
$
|
96.18
|
|
|
$
|
80.01
|
|
|
$
|
74.89
|
|
(In millions, except per share data and percentage data)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Total cash dividend payments
|
$
|
1,455
|
|
|
$
|
1,288
|
|
|
$
|
1,121
|
|
Dividends paid per share
|
$
|
1.78
|
|
|
$
|
1.52
|
|
|
$
|
1.26
|
|
Dividend payout ratio
|
63
|
%
|
|
37
|
%
|
|
36
|
%
|
Debt Ratings
|
S&P
|
|
Moody’s
|
Commercial Paper
|
A-2
|
|
P-2
|
Senior Debt
|
BBB+
1
|
|
Baa1
2
|
Outlook
|
Stable
|
|
Stable
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligations
(in millions)
|
Total
|
|
|
Less Than 1 Year
|
|
|
1-3 Years
|
|
|
4-5 Years
|
|
|
After 5 Years
|
|
|||||
Long-term debt (principal amounts, excluding discount and debt issuance costs)
|
$
|
14,865
|
|
|
$
|
1,050
|
|
|
$
|
1,526
|
|
|
$
|
1,266
|
|
|
$
|
11,023
|
|
Long-term debt (interest payments)
|
8,709
|
|
|
570
|
|
|
1,066
|
|
|
950
|
|
|
6,123
|
|
|||||
Capitalized lease obligations
1, 2
|
1,266
|
|
|
133
|
|
|
177
|
|
|
173
|
|
|
783
|
|
|||||
Operating leases
1
|
5,365
|
|
|
595
|
|
|
1,169
|
|
|
992
|
|
|
2,609
|
|
|||||
Purchase obligations
3
|
1,022
|
|
|
564
|
|
|
438
|
|
|
20
|
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
31,227
|
|
|
$
|
2,912
|
|
|
$
|
4,376
|
|
|
$
|
3,401
|
|
|
$
|
20,538
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Amount of Commitment Expiration by Period
|
||||||||||||||||||
Commercial Commitments
(in millions)
|
Total
|
|
|
Less Than 1 Year
|
|
|
1-3 Years
|
|
|
4-5 Years
|
|
|
After 5 Years
|
|
|||||
Letters of Credit
4
|
$
|
59
|
|
|
$
|
58
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
1
|
Amounts do not include taxes, common area maintenance, insurance, or contingent rent because these amounts have historically been insignificant.
|
2
|
Amounts include imputed interest and residual values.
|
3
|
Purchase obligations include agreements to purchase goods or services that are enforceable, are legally binding, and specify all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the transaction. Our purchase obligations include firm commitments related to certain marketing and information technology programs, as well as purchases of merchandise inventory.
|
4
|
Letters of credit are issued primarily for insurance and construction contracts.
|
|
February 1, 2019
|
|
|
% Sales
|
|
|
February 2, 2018
|
|
|
% Sales
|
|
|
February 3, 2017
|
|
|
% Sales
|
|
|||
Fiscal years ended on
|
||||||||||||||||||||
Net sales
|
$
|
71,309
|
|
|
100.00
|
%
|
|
$
|
68,619
|
|
|
100.00
|
%
|
|
$
|
65,017
|
|
|
100.00
|
%
|
Cost of sales
|
48,401
|
|
|
67.88
|
|
|
46,185
|
|
|
67.31
|
|
|
43,343
|
|
|
66.66
|
|
|||
Gross margin
|
22,908
|
|
|
32.12
|
|
|
22,434
|
|
|
32.69
|
|
|
21,674
|
|
|
33.34
|
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling, general and administrative
|
17,413
|
|
|
24.41
|
|
|
14,444
|
|
|
21.04
|
|
|
14,375
|
|
|
22.12
|
|
|||
Depreciation and amortization
|
1,477
|
|
|
2.07
|
|
|
1,404
|
|
|
2.05
|
|
|
1,453
|
|
|
2.23
|
|
|||
Operating income
|
4,018
|
|
|
5.64
|
|
|
6,586
|
|
|
9.60
|
|
|
5,846
|
|
|
8.99
|
|
|||
Interest - net
|
624
|
|
|
0.88
|
|
|
633
|
|
|
0.92
|
|
|
645
|
|
|
0.99
|
|
|||
Loss on extinguishment of debt
|
—
|
|
|
—
|
|
|
464
|
|
|
0.68
|
|
|
—
|
|
|
—
|
|
|||
Pre-tax earnings
|
3,394
|
|
|
4.76
|
|
|
5,489
|
|
|
8.00
|
|
|
5,201
|
|
|
8.00
|
|
|||
Income tax provision
|
1,080
|
|
|
1.52
|
|
|
2,042
|
|
|
2.98
|
|
|
2,108
|
|
|
3.24
|
|
|||
Net earnings
|
$
|
2,314
|
|
|
3.24
|
%
|
|
$
|
3,447
|
|
|
5.02
|
%
|
|
$
|
3,093
|
|
|
4.76
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Basic earnings per common share
|
$
|
2.84
|
|
|
|
|
$
|
4.09
|
|
|
|
|
$
|
3.48
|
|
|
|
|||
Diluted earnings per common share
|
$
|
2.84
|
|
|
|
|
$
|
4.09
|
|
|
|
|
$
|
3.47
|
|
|
|
|||
Cash dividends per share
|
$
|
1.85
|
|
|
|
|
$
|
1.58
|
|
|
|
|
$
|
1.33
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
February 1, 2019
|
|
|
% Sales
|
|
|
February 2, 2018
|
|
|
% Sales
|
|
|
February 3, 2017
|
|
|
% Sales
|
|
|||
Fiscal years ended on
|
|
|
||||||||||||||||||
Net earnings
|
$
|
2,314
|
|
|
3.24
|
%
|
|
$
|
3,447
|
|
|
5.02
|
%
|
|
$
|
3,093
|
|
|
4.76
|
%
|
Foreign currency translation adjustments - net of tax
|
(221
|
)
|
|
(0.30
|
)
|
|
251
|
|
|
0.37
|
|
|
154
|
|
|
0.23
|
|
|||
Net unrealized investment gain - net of tax
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Other comprehensive income/(loss)
|
(220
|
)
|
|
(0.30
|
)
|
|
251
|
|
|
0.37
|
|
|
154
|
|
|
0.23
|
|
|||
Comprehensive income
|
$
|
2,094
|
|
|
2.94
|
%
|
|
$
|
3,698
|
|
|
5.39
|
%
|
|
$
|
3,247
|
|
|
4.99
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
|
|||||||||
Assets
|
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
|
$
|
511
|
|
|
$
|
588
|
|
Short-term investments
|
|
|
218
|
|
|
102
|
|
||
Merchandise inventory - net
|
|
|
12,561
|
|
|
11,393
|
|
||
Other current assets
|
|
|
938
|
|
|
689
|
|
||
Total current assets
|
|
|
14,228
|
|
|
12,772
|
|
||
Property, less accumulated depreciation
|
|
|
18,432
|
|
|
19,721
|
|
||
Long-term investments
|
|
|
256
|
|
|
408
|
|
||
Deferred income taxes - net
|
|
|
294
|
|
|
168
|
|
||
Goodwill
|
|
|
303
|
|
|
1,307
|
|
||
Other assets
|
|
|
995
|
|
|
915
|
|
||
Total assets
|
|
|
$
|
34,508
|
|
|
$
|
35,291
|
|
|
|
|
|
|
|
||||
Liabilities and shareholders’ equity
|
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|
||||
Short-term borrowings
|
|
|
$
|
722
|
|
|
$
|
1,137
|
|
Current maturities of long-term debt
|
|
|
1,110
|
|
|
294
|
|
||
Accounts payable
|
|
|
8,279
|
|
|
6,590
|
|
||
Accrued compensation and employee benefits
|
|
|
662
|
|
|
747
|
|
||
Deferred revenue
|
|
|
1,299
|
|
|
1,378
|
|
||
Other current liabilities
|
|
|
2,425
|
|
|
1,950
|
|
||
Total current liabilities
|
|
|
14,497
|
|
|
12,096
|
|
||
Long-term debt, excluding current maturities
|
|
|
14,391
|
|
|
15,564
|
|
||
Deferred revenue - extended protection plans
|
|
|
827
|
|
|
803
|
|
||
Other liabilities
|
|
|
1,149
|
|
|
955
|
|
||
Total liabilities
|
|
|
30,864
|
|
|
29,418
|
|
||
|
|
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||||
|
|
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
|
|
||||
Preferred stock - $5 par value, none issued
|
|
|
—
|
|
|
—
|
|
||
Common stock - $.50 par value;
|
|
|
|
|
|
|
|
||
Shares issued and outstanding
|
|
|
|
|
|
||||
February 1, 2019
|
801
|
|
|
|
|
||||
February 2, 2018
|
830
|
|
401
|
|
|
415
|
|
||
Capital in excess of par value
|
|
|
—
|
|
|
22
|
|
||
Retained earnings
|
|
|
3,452
|
|
|
5,425
|
|
||
Accumulated other comprehensive income/(loss)
|
|
|
(209
|
)
|
|
11
|
|
||
Total shareholders’ equity
|
|
|
3,644
|
|
|
5,873
|
|
||
Total liabilities and shareholders’ equity
|
|
|
$
|
34,508
|
|
|
$
|
35,291
|
|
|
Common Stock
|
|
Capital in Excess
of Par Value |
|
|
Retained Earnings
|
|
|
Accumulated Other Comprehensive
Income/(Loss) |
|
|
Total Lowe’s Companies, Inc.
Shareholders’ Equity |
|
|
Noncontrolling
Interest |
|
|
Total
Equity |
|
|||||||||||
|
Shares
|
|
|
Amount
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance January 29, 2016
|
910
|
|
|
$
|
455
|
|
|
$
|
—
|
|
|
$
|
7,593
|
|
|
$
|
(394
|
)
|
|
$
|
7,654
|
|
|
$
|
—
|
|
|
$
|
7,654
|
|
Net earnings
|
|
|
|
|
|
|
3,091
|
|
|
|
|
3,091
|
|
|
2
|
|
|
3,093
|
|
|||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
154
|
|
|
154
|
|
|
|
|
154
|
|
||||||||||||
Tax effect of non-qualified stock options exercised and restricted stock vested
|
|
|
|
|
57
|
|
|
|
|
|
|
57
|
|
|
|
|
57
|
|
||||||||||||
Cash dividends declared, $1.33 per share
|
|
|
|
|
|
|
(1,169
|
)
|
|
|
|
(1,169
|
)
|
|
|
|
(1,169
|
)
|
||||||||||||
Share-based payment expense
|
|
|
|
|
104
|
|
|
|
|
|
|
104
|
|
|
|
|
104
|
|
||||||||||||
Repurchase of common stock
|
(48
|
)
|
|
(24
|
)
|
|
(279
|
)
|
|
(3,274
|
)
|
|
|
|
(3,577
|
)
|
|
|
|
(3,577
|
)
|
|||||||||
Issuance of common stock under share-based payment plans
|
4
|
|
|
2
|
|
|
136
|
|
|
|
|
|
|
138
|
|
|
|
|
138
|
|
||||||||||
Noncontrolling interest resulting from acquisition
|
|
|
|
|
|
|
|
|
|
|
$
|
—
|
|
|
$
|
109
|
|
|
$
|
109
|
|
|||||||||
Dividends paid to noncontrolling interest holders
|
|
|
|
|
|
|
|
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|||||||||
Purchase of noncontrolling interest
|
|
|
|
|
$
|
(18
|
)
|
|
|
|
|
|
$
|
(18
|
)
|
|
$
|
(109
|
)
|
|
$
|
(127
|
)
|
|||||||
Balance February 3, 2017
|
866
|
|
|
$
|
433
|
|
|
$
|
—
|
|
|
$
|
6,241
|
|
|
$
|
(240
|
)
|
|
$
|
6,434
|
|
|
$
|
—
|
|
|
$
|
6,434
|
|
Net earnings
|
|
|
|
|
|
|
3,447
|
|
|
|
|
3,447
|
|
|
|
|
|
3,447
|
|
|||||||||||
Other comprehensive income
|
|
|
|
|
|
|
|
|
251
|
|
|
251
|
|
|
|
|
251
|
|
||||||||||||
Cash dividends declared, $1.58 per share
|
|
|
|
|
|
|
(1,324
|
)
|
|
|
|
(1,324
|
)
|
|
|
|
(1,324
|
)
|
||||||||||||
Share-based payment expense
|
|
|
|
|
99
|
|
|
|
|
|
|
99
|
|
|
|
|
99
|
|
||||||||||||
Repurchase of common stock
|
(40
|
)
|
|
(20
|
)
|
|
(215
|
)
|
|
(2,939
|
)
|
|
|
|
(3,174
|
)
|
|
|
|
(3,174
|
)
|
|||||||||
Issuance of common stock under share-based payment plans
|
4
|
|
|
2
|
|
|
138
|
|
|
|
|
|
|
140
|
|
|
|
|
140
|
|
||||||||||
Balance February 2, 2018
|
830
|
|
|
$
|
415
|
|
|
$
|
22
|
|
|
$
|
5,425
|
|
|
$
|
11
|
|
|
$
|
5,873
|
|
|
$
|
—
|
|
|
$
|
5,873
|
|
Cumulative effect of accounting change
|
|
|
|
|
|
|
33
|
|
|
|
|
33
|
|
|
|
|
33
|
|
||||||||||||
Net earnings
|
|
|
|
|
|
|
2,314
|
|
|
|
|
2,314
|
|
|
|
|
2,314
|
|
||||||||||||
Other comprehensive loss
|
|
|
|
|
|
|
|
|
(220
|
)
|
|
(220
|
)
|
|
|
|
(220
|
)
|
||||||||||||
Cash dividends declared, $1.85 per share
|
|
|
|
|
|
|
(1,500
|
)
|
|
|
|
(1,500
|
)
|
|
|
|
(1,500
|
)
|
||||||||||||
Share-based payment expense
|
|
|
|
|
74
|
|
|
|
|
|
|
74
|
|
|
|
|
74
|
|
||||||||||||
Repurchase of common stock
|
(32
|
)
|
|
(16
|
)
|
|
(209
|
)
|
|
(2,820
|
)
|
|
|
|
(3,045
|
)
|
|
|
|
(3,045
|
)
|
|||||||||
Issuance of common stock under share-based payment plans
|
3
|
|
|
2
|
|
|
113
|
|
|
|
|
|
|
115
|
|
|
|
|
115
|
|
||||||||||
Balance February 1, 2019
|
801
|
|
|
$
|
401
|
|
|
$
|
—
|
|
|
$
|
3,452
|
|
|
$
|
(209
|
)
|
|
$
|
3,644
|
|
|
$
|
—
|
|
|
$
|
3,644
|
|
|
February 1, 2019
|
|
|
February 2, 2018
|
|
|
February 3, 2017
|
|
|||
Fiscal years ended on
|
|||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net earnings
|
$
|
2,314
|
|
|
$
|
3,447
|
|
|
$
|
3,093
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
1,607
|
|
|
1,540
|
|
|
1,590
|
|
|||
Deferred income taxes
|
(151
|
)
|
|
53
|
|
|
28
|
|
|||
Loss on property and other assets - net
|
630
|
|
|
40
|
|
|
143
|
|
|||
Impairment of goodwill
|
952
|
|
|
—
|
|
|
—
|
|
|||
Loss on extinguishment of debt
|
—
|
|
|
464
|
|
|
—
|
|
|||
(Gain) loss on cost method and equity method investments
|
9
|
|
|
(82
|
)
|
|
302
|
|
|||
Share-based payment expense
|
74
|
|
|
99
|
|
|
90
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Merchandise inventory – net
|
(1,289
|
)
|
|
(791
|
)
|
|
(178
|
)
|
|||
Other operating assets
|
(110
|
)
|
|
250
|
|
|
(183
|
)
|
|||
Accounts payable
|
1,720
|
|
|
(92
|
)
|
|
653
|
|
|||
Other operating liabilities
|
437
|
|
|
137
|
|
|
79
|
|
|||
Net cash provided by operating activities
|
6,193
|
|
|
5,065
|
|
|
5,617
|
|
|||
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of investments
|
(1,373
|
)
|
|
(981
|
)
|
|
(1,192
|
)
|
|||
Proceeds from sale/maturity of investments
|
1,393
|
|
|
1,114
|
|
|
1,254
|
|
|||
Capital expenditures
|
(1,174
|
)
|
|
(1,123
|
)
|
|
(1,167
|
)
|
|||
Proceeds from sale of property and other long-term assets
|
76
|
|
|
45
|
|
|
37
|
|
|||
Purchases of derivative instruments
|
—
|
|
|
—
|
|
|
(103
|
)
|
|||
Proceeds from settlement of derivative instruments
|
—
|
|
|
—
|
|
|
179
|
|
|||
Acquisition of business - net
|
—
|
|
|
(509
|
)
|
|
(2,356
|
)
|
|||
Other – net
|
(2
|
)
|
|
13
|
|
|
(13
|
)
|
|||
Net cash used in investing activities
|
(1,080
|
)
|
|
(1,441
|
)
|
|
(3,361
|
)
|
|||
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Net change in short-term borrowings
|
(415
|
)
|
|
625
|
|
|
466
|
|
|||
Net proceeds from issuance of long-term debt
|
—
|
|
|
2,968
|
|
|
3,267
|
|
|||
Repayment of long-term debt
|
(326
|
)
|
|
(2,849
|
)
|
|
(1,173
|
)
|
|||
Proceeds from issuance of common stock under share-based payment plans
|
114
|
|
|
139
|
|
|
139
|
|
|||
Cash dividend payments
|
(1,455
|
)
|
|
(1,288
|
)
|
|
(1,121
|
)
|
|||
Repurchase of common stock
|
(3,037
|
)
|
|
(3,192
|
)
|
|
(3,595
|
)
|
|||
Other – net
|
(5
|
)
|
|
(10
|
)
|
|
(75
|
)
|
|||
Net cash used in financing activities
|
(5,124
|
)
|
|
(3,607
|
)
|
|
(2,092
|
)
|
|||
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash
|
(12
|
)
|
|
13
|
|
|
(11
|
)
|
|||
|
|
|
|
|
|
||||||
Net increase/(decrease) in cash and cash equivalents, including cash classified within current assets held for sale
|
(23
|
)
|
|
30
|
|
|
153
|
|
|||
Less: Net increase in cash classified within current assets held for sale
|
(54
|
)
|
|
—
|
|
|
—
|
|
|||
Net increase/(decrease) in cash and cash equivalents
|
(77
|
)
|
|
30
|
|
|
153
|
|
|||
Cash and cash equivalents, beginning of year
|
588
|
|
|
558
|
|
|
405
|
|
|||
Cash and cash equivalents, end of year
|
$
|
511
|
|
|
$
|
588
|
|
|
$
|
558
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Goodwill, balance at beginning of year
|
$
|
1,307
|
|
|
$
|
1,082
|
|
|
$
|
154
|
|
Acquisitions
1
|
—
|
|
|
160
|
|
|
1,015
|
|
|||
Impairment
|
(952
|
)
|
|
—
|
|
|
(46
|
)
|
|||
Other adjustments
2
|
(52
|
)
|
|
65
|
|
|
(41
|
)
|
|||
Goodwill, balance at end of year
|
$
|
303
|
|
|
$
|
1,307
|
|
|
$
|
1,082
|
|
1
|
Goodwill recorded for 2017 acquisitions relates to Maintenance Supply Headquarters. Goodwill recorded for 2016 acquisitions primarily relates to RONA. See Note
4
for additional information regarding these acquisitions.
|
2
|
Other adjustments primarily consist of changes in the goodwill balance as a result of foreign currency translation.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||
(In millions)
|
Gross Carrying Amount
|
|
|
Cumulative Impairment
|
|
|
Gross Carrying Amount
|
|
|
Cumulative Impairment
|
|
||||
Goodwill
|
$
|
1,302
|
|
|
$
|
(999
|
)
|
|
$
|
1,354
|
|
|
$
|
(47
|
)
|
(In millions)
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
Accrued dividends
|
$
|
385
|
|
|
$
|
340
|
|
Self-insurance liabilities
|
378
|
|
|
347
|
|
||
Sales return reserve
|
194
|
|
|
71
|
|
||
Accrued interest
|
184
|
|
|
184
|
|
||
Sales tax liabilities
|
179
|
|
|
144
|
|
||
Accrued property taxes
|
108
|
|
|
109
|
|
||
Other
|
997
|
|
|
755
|
|
||
Total
|
$
|
2,425
|
|
|
$
|
1,950
|
|
Cost of Sales
|
|
Selling, General and Administrative
|
n
Total cost of products sold, including:
- Purchase costs, net of vendor funds;
- Freight expenses associated with moving merchandise inventories from vendors to selling locations;
- Costs associated with operating the Company’s distribution network, including payroll and benefit costs and occupancy costs;
n
Costs of installation services provided;
n
Costs associated with shipping and handling to
customers, as well as directly from vendors to
customers by third parties;
n
Costs associated with inventory shrinkage and obsolescence;
n
Costs of services performed under the extended protection plan.
|
|
n
Payroll and benefit costs for retail and corporate employees;
n
Occupancy costs of retail and corporate facilities;
n
Advertising;
n
Third-party, in-store service costs;
n
Tender costs, including bank charges, costs associated with credit card interchange fees and amounts associated with accepting the Company’s proprietary credit cards;
n
Costs associated with self-insured plans, and premium costs for stop-loss coverage and fully insured plans;
n
Long-lived asset impairment losses, gains/losses on disposal of assets, and exit costs;
n
Other administrative costs, such as supplies, and travel and entertainment.
|
|
|
Twelve Months Ended February 1, 2019
|
||||||||||
Consolidated Statement of Earnings
(in millions)
|
|
As Reported
|
|
Under Historical Guidance
|
|
Impact of Adopting ASU 2014-09
|
||||||
Net Sales
|
|
$
|
71,309
|
|
|
$
|
70,586
|
|
|
$
|
723
|
|
Cost of sales
|
|
48,401
|
|
|
48,481
|
|
|
(80
|
)
|
|||
Gross margin
|
|
22,908
|
|
|
22,105
|
|
|
803
|
|
|||
Selling, general and administrative
|
|
17,413
|
|
|
16,610
|
|
|
803
|
|
|||
Operating income
|
|
4,018
|
|
|
4,018
|
|
|
—
|
|
|||
Pre-tax earnings
|
|
3,394
|
|
|
3,394
|
|
|
—
|
|
|||
Net earnings
|
|
2,314
|
|
|
2,314
|
|
|
—
|
|
|
|
Balance at February 1, 2019
|
||||||||||
|
|
As Reported
|
|
Under Historical Guidance
|
|
Impact of Adopting ASU 2014-09
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Other current assets
|
|
$
|
938
|
|
|
$
|
811
|
|
|
$
|
127
|
|
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
|
||||||
Accounts payable
|
|
8,279
|
|
|
8,272
|
|
|
7
|
|
|||
Deferred revenue
|
|
1,299
|
|
|
1,371
|
|
|
(72
|
)
|
|||
Other current liabilities
|
|
2,425
|
|
|
2,281
|
|
|
144
|
|
(In millions)
|
|
Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
|||||||
Products
|
|
$
|
67,197
|
|
|
$
|
65,421
|
|
|
$
|
62,053
|
|
Services
|
|
2,539
|
|
|
2,469
|
|
|
2,505
|
|
|||
Other
|
|
1,573
|
|
|
729
|
|
|
459
|
|
|||
Net sales
|
|
$
|
71,309
|
|
|
$
|
68,619
|
|
|
$
|
65,017
|
|
|
|
Year Ended
|
||||||||||||||||
|
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||||||||
(In millions)
|
|
Total Sales
|
|
%
|
|
Total Sales
|
|
%
|
|
Total Sales
|
|
%
|
||||||
Building & Maintenance ¹
|
|
$
|
28,582
|
|
|
40
|
|
$
|
27,689
|
|
|
41
|
|
$
|
25,868
|
|
|
40
|
Home Décor ²
|
|
27,987
|
|
|
39
|
|
27,422
|
|
|
39
|
|
26,269
|
|
|
40
|
|||
Seasonal ³
|
|
12,786
|
|
|
18
|
|
12,384
|
|
|
19
|
|
12,090
|
|
|
19
|
|||
Other
|
|
1,955
|
|
|
3
|
|
1,124
|
|
|
1
|
|
790
|
|
|
1
|
|||
Total
|
|
$
|
71,309
|
|
|
100
|
|
$
|
68,619
|
|
|
100
|
|
$
|
65,017
|
|
|
100
|
1
|
Building & Maintenance includes the following product categories: Lumber & Building Materials, Millwork, Rough Plumbing & Electrical, and Tools & Hardware.
|
2
|
Home Décor includes the following product categories: Appliances, Fashion Fixtures, Flooring, Kitchens, and Paint.
|
3
|
Seasonal includes the following product categories: Lawn & Garden and Seasonal & Outdoor Living.
|
(In millions)
|
|
Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
|||||||
United States
|
|
$
|
65,872
|
|
|
$
|
63,263
|
|
|
$
|
61,333
|
|
International
|
|
5,437
|
|
|
5,356
|
|
|
3,684
|
|
|||
Net Sales
|
|
$
|
71,309
|
|
|
$
|
68,619
|
|
|
$
|
65,017
|
|
(In millions)
|
June 23, 2017
|
||
Allocation:
|
|
||
Cash acquired
|
$
|
4
|
|
Merchandise inventory
|
68
|
|
|
Other current assets
|
36
|
|
|
Property
|
12
|
|
|
Goodwill
|
160
|
|
|
Other assets
|
260
|
|
|
Accounts payable
|
(18
|
)
|
|
Other current liabilities
|
(9
|
)
|
|
Net assets acquired
|
$
|
513
|
|
(In millions)
|
May 20, 2016
|
||
Purchase price:
|
|
||
Cash paid to common shareholders
|
$
|
1,999
|
|
Cash paid to debt holders
|
368
|
|
|
Total cash paid
|
$
|
2,367
|
|
|
|
||
Allocation:
|
|
||
Cash acquired
|
$
|
83
|
|
Accounts receivable
|
260
|
|
|
Merchandise inventory
|
814
|
|
|
Property
|
897
|
|
|
Goodwill
|
971
|
|
|
Other assets
|
437
|
|
|
Other current liabilities
|
(619
|
)
|
|
Long-term liabilities
|
(367
|
)
|
|
Noncontrolling interest
|
(109
|
)
|
|
Net assets acquired
|
$
|
2,367
|
|
•
|
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
|
|
|
|
Fair Value Measurements at
|
||||||
(In millions)
|
Measurement Level
|
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
Available-for-sale securities:
|
|
|
|
|
|
||||
Money market funds
|
Level 1
|
|
$
|
207
|
|
|
$
|
86
|
|
Agency securities
|
Level 2
|
|
10
|
|
|
—
|
|
||
Corporate debt securities
|
Level 2
|
|
1
|
|
|
—
|
|
||
Certificates of deposit
|
Level 1
|
|
—
|
|
|
16
|
|
||
Total short-term investments
|
|
|
$
|
218
|
|
|
$
|
102
|
|
Available-for-sale securities:
|
|
|
|
|
|
||||
Corporate debt securities
|
Level 2
|
|
$
|
191
|
|
|
$
|
—
|
|
Agency securities
|
Level 2
|
|
$
|
65
|
|
|
$
|
—
|
|
Municipal floating rate obligations
|
Level 2
|
|
$
|
—
|
|
|
$
|
407
|
|
Certificates of deposit
|
Level 1
|
|
—
|
|
|
1
|
|
||
Total long-term investments
|
|
|
$
|
256
|
|
|
$
|
408
|
|
|
February 1, 2019
|
||||||
(In millions)
|
Fair Value Measurements
|
|
|
Impairment Losses
|
|
||
Assets-held-for-use:
|
|
|
|
||||
Operating locations
|
$
|
473
|
|
|
$
|
(331
|
)
|
Assets-held-for-sale:
|
|
|
|
||||
Mexico operating locations
|
$
|
79
|
|
|
$
|
(222
|
)
|
Goodwill (Note 1)
|
$
|
2,851
|
|
|
$
|
(952
|
)
|
Total
|
$
|
3,403
|
|
|
$
|
(1,505
|
)
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||
(In millions)
|
Carrying Amount
|
|
|
Fair Value
|
|
|
Carrying Amount
|
|
|
Fair Value
|
|
||||
Unsecured notes (Level 1)
|
$
|
14,721
|
|
|
$
|
14,473
|
|
|
$
|
14,961
|
|
|
$
|
15,608
|
|
Mortgage notes (Level 2)
|
6
|
|
|
6
|
|
|
6
|
|
|
7
|
|
||||
Long-term debt (excluding capitalized lease obligations)
|
$
|
14,727
|
|
|
$
|
14,479
|
|
|
$
|
14,967
|
|
|
$
|
15,615
|
|
(In millions)
|
Estimated
Depreciable Lives, In Years |
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
Cost:
|
|
|
|
|
|
||||
Land
|
N/A
|
|
$
|
7,196
|
|
|
$
|
7,414
|
|
Buildings and building improvements
|
5-40
|
|
18,052
|
|
|
18,521
|
|
||
Equipment
|
2-15
|
|
10,090
|
|
|
10,475
|
|
||
Construction in progress
|
N/A
|
|
525
|
|
|
530
|
|
||
Total cost
|
|
|
35,863
|
|
|
36,940
|
|
||
Accumulated depreciation
|
|
|
(17,431
|
)
|
|
(17,219
|
)
|
||
Property, less accumulated depreciation
|
|
|
$
|
18,432
|
|
|
$
|
19,721
|
|
|
Costs Incurred
|
||||||||||||||
|
Three Months Ended
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Year Ended
|
||||||||
(In millions)
|
August 3,
2018
|
|
November 2, 2018
|
|
February 1, 2019
|
|
February 1, 2019
|
||||||||
Long-lived asset impairments
|
$
|
206
|
|
|
$
|
121
|
|
|
$
|
222
|
|
|
$
|
549
|
|
Lease obligation costs for closed locations
|
—
|
|
|
9
|
|
|
298
|
|
|
307
|
|
||||
Accelerated depreciation and amortization
|
—
|
|
|
103
|
|
|
50
|
|
|
153
|
|
||||
Severance costs
|
—
|
|
|
32
|
|
|
26
|
|
|
58
|
|
||||
Discontinued project write-offs
|
24
|
|
|
10
|
|
|
—
|
|
|
34
|
|
||||
Inventory adjustments to net realizable value
|
—
|
|
|
5
|
|
|
2
|
|
|
7
|
|
||||
Other closing costs
|
—
|
|
|
—
|
|
|
27
|
|
|
27
|
|
||||
Total
|
$
|
230
|
|
|
$
|
280
|
|
|
$
|
625
|
|
|
$
|
1,135
|
|
|
|
2018
|
||
(In millions)
|
|
Lease obligations
|
||
Accrual for exit activities, balance at the beginning of period
|
|
$
|
60
|
|
Additions to the accrual - net
|
|
365
|
|
|
Cash payments
|
|
(86
|
)
|
|
Adjustments
1
|
|
22
|
|
|
Accrual for exit activities, balance at the end of period
|
|
$
|
361
|
|
Debt Category
(In millions) |
Weighted-Average Interest Rate at February 1, 2019
|
|
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
Secured debt:
|
|
|
|
|
|
|||||
Mortgage notes due through fiscal 2027
1
|
5.26
|
%
|
|
$
|
6
|
|
|
$
|
6
|
|
Unsecured debt:
|
|
|
|
|
|
|||||
Notes due through fiscal 2023
|
3.43
|
%
|
|
3,832
|
|
|
4,079
|
|
||
Notes due fiscal 2024-2028
|
3.30
|
%
|
|
4,393
|
|
|
4,389
|
|
||
Notes due fiscal 2029-2033
|
6.50
|
%
|
|
309
|
|
|
309
|
|
||
Notes due fiscal 2034-2038
|
5.96
|
%
|
|
897
|
|
|
897
|
|
||
Notes due fiscal 2039-2043
|
4.96
|
%
|
|
1,411
|
|
|
1,410
|
|
||
Notes due fiscal 2044-2048
|
4.01
|
%
|
|
3,879
|
|
|
3,877
|
|
||
Capitalized lease obligations due through fiscal 2038
|
|
|
774
|
|
|
891
|
|
|||
Total long-term debt
|
|
|
15,501
|
|
|
15,858
|
|
|||
Less current maturities
|
|
|
(1,110
|
)
|
|
(294
|
)
|
|||
Long-term debt, excluding current maturities
|
|
|
$
|
14,391
|
|
|
$
|
15,564
|
|
1
|
Real properties with an aggregate book value of
$16 million
were pledged as collateral at
February 1, 2019
, for secured debt.
|
Issue Date
|
|
Principal Amount (in millions)
|
|
Maturity Date
|
|
Fixed vs. Floating
|
|
Interest Rate
|
|
Discount (in millions)
|
||||
April 2016
|
|
$
|
250
|
|
|
April 2019
|
|
Floating
|
|
Floating
|
|
$
|
1
|
|
April 2016
|
|
$
|
350
|
|
|
April 2019
|
|
Fixed
|
|
1.150%
|
|
$
|
1
|
|
April 2016
|
|
$
|
1,350
|
|
|
April 2026
|
|
Fixed
|
|
2.500%
|
|
$
|
12
|
|
April 2016
|
|
$
|
1,350
|
|
|
April 2046
|
|
Fixed
|
|
3.700%
|
|
$
|
19
|
|
Issue Date
|
|
Principal Amount (in millions)
|
|
Maturity Date
|
|
Fixed vs. Floating
|
|
Interest Rate
|
|
Discount (in millions)
|
||||
May 2017
|
|
$
|
1,500
|
|
|
May 2027
|
|
Fixed
|
|
3.100%
|
|
$
|
9
|
|
May 2017
|
|
$
|
1,500
|
|
|
May 2047
|
|
Fixed
|
|
4.050%
|
|
$
|
23
|
|
Agreement Execution Date
|
ASR Settlement Date
|
ASR Agreement Amount
|
Initial Shares Delivered
|
Additional Shares Delivered at Settlement
|
Total Shares Delivered
|
|||||
Q1 2016
|
Q2 2016
|
$
|
500
|
|
6.2
|
|
0.6
|
|
6.8
|
|
Q2 2016
|
Q3 2016
|
500
|
|
5.3
|
|
1.0
|
|
6.3
|
|
|
Q3 2016
|
Q3 2016
|
250
|
|
2.8
|
|
0.6
|
|
3.4
|
|
|
Q4 2016
|
Q4 2016
|
190
|
|
2.4
|
|
0.2
|
|
2.6
|
|
|
Q1 2017
|
Q1 2017
|
500
|
|
5.3
|
|
0.8
|
|
6.1
|
|
|
Q2 2017
|
Q2 2017
|
500
|
|
5.2
|
|
1.2
|
|
6.4
|
|
|
Q3 2017
|
Q3 2017
|
250
|
|
2.9
|
|
0.3
|
|
3.2
|
|
|
Q2 2018
|
Q2 2018
|
550
|
|
4.8
|
|
0.8
|
|
5.6
|
|
|
Q3 2018
|
Q3 2018
|
310
|
|
2.5
|
|
0.3
|
|
2.8
|
|
|
Q4 2018
|
Q1 2019
|
270
|
|
2.6
|
|
0.3
|
|
2.9
|
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
(In millions)
|
Shares
|
|
|
Cost
1
|
|
|
Shares
|
|
|
Cost
1
|
|
|
Shares
|
|
|
Cost
1
|
|
|||
Share repurchase program
|
31.2
|
|
|
$
|
2,999
|
|
|
39.1
|
|
|
$
|
3,133
|
|
|
46.7
|
|
|
$
|
3,500
|
|
Shares withheld from employees
|
0.5
|
|
|
46
|
|
|
0.5
|
|
|
41
|
|
|
1.0
|
|
|
77
|
|
|||
Total share repurchases
|
31.7
|
|
|
$
|
3,045
|
|
|
39.6
|
|
|
$
|
3,174
|
|
|
47.7
|
|
|
$
|
3,577
|
|
1
|
Reductions of
$2.8 billion
,
$2.9 billion
, and
$3.3 billion
were recorded to retained earnings, after capital in excess of par value was depleted, for
2018
,
2017
, and 2016, respectively.
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Weighted-average assumptions used:
|
|
|
|
|
|
||||||
Expected volatility
|
23.3
|
%
|
|
23.6
|
%
|
|
24.0
|
%
|
|||
Dividend yield
|
1.71
|
%
|
|
1.68
|
%
|
|
1.66
|
%
|
|||
Risk-free interest rate
|
2.71
|
%
|
|
2.14
|
%
|
|
1.42
|
%
|
|||
Expected term, in years
|
6.58
|
|
|
6.43
|
|
|
6.44
|
|
|||
|
|
|
|
|
|
||||||
Weighted-average grant date fair value
|
$
|
21.12
|
|
|
$
|
18.30
|
|
|
$
|
15.00
|
|
|
Shares
(In thousands) |
|
|
Weighted-Average Exercise Price Per Share
|
|
|
Weighted-Average Remaining Term (In years)
|
|
Aggregate Intrinsic Value (In thousands)
|
|
||
Outstanding at February 2, 2018
|
2,815
|
|
|
$
|
60.84
|
|
|
|
|
|
||
Granted
|
1,021
|
|
|
90.75
|
|
|
|
|
|
|||
Canceled, forfeited or expired
|
(385
|
)
|
|
79.63
|
|
|
|
|
|
|||
Exercised
|
(760
|
)
|
|
55.95
|
|
|
|
|
|
|||
Outstanding at February 1, 2019
|
2,691
|
|
|
$
|
70.87
|
|
|
7.10
|
|
$
|
72,613
|
|
Vested and expected to vest at February 1, 2019
1
|
2,610
|
|
|
$
|
70.18
|
|
|
7.04
|
|
$
|
72,067
|
|
Exercisable at February 1, 2019
|
1,719
|
|
|
$
|
60.49
|
|
|
6.03
|
|
$
|
62,943
|
|
1
|
Includes outstanding vested options as well as outstanding nonvested options after a forfeiture rate is applied.
|
|
Shares
(In thousands) |
|
|
Weighted-Average Grant-Date Fair Value Per Share
|
|
|
Nonvested at February 2, 2018
|
1,896
|
|
|
$
|
73.21
|
|
Granted
|
1,021
|
|
|
86.99
|
|
|
Vested
|
(772
|
)
|
|
70.93
|
|
|
Canceled or forfeited
|
(355
|
)
|
|
77.73
|
|
|
Nonvested at February 1, 2019
|
1,790
|
|
|
$
|
81.16
|
|
|
Units
(In thousands) 1 |
|
|
Weighted-Average Grant-Date Fair Value Per Unit
|
|
|
Nonvested at February 2, 2018
|
698
|
|
|
$
|
81.31
|
|
Granted
|
320
|
|
|
82.22
|
|
|
Vested
|
(144
|
)
|
|
71.22
|
|
|
Canceled or forfeited
|
(261
|
)
|
|
82.09
|
|
|
Nonvested at February 1, 2019
|
613
|
|
|
$
|
83.83
|
|
¹
|
The number of units presented is based on achieving the targeted performance goals as defined in the performance share unit agreements. As of
February 1, 2019
, the maximum number of nonvested units that could vest under the provisions of the agreements was
1.2 million
for the RONCAA awards.
|
|
Shares
(In thousands) |
|
|
Weighted-Average Grant-Date Fair Value Per Share
|
|
|
Nonvested at February 2, 2018
|
277
|
|
|
$
|
69.21
|
|
Granted
|
182
|
|
|
80.32
|
|
|
Vested
|
(63
|
)
|
|
66.62
|
|
|
Canceled or forfeited
|
(67
|
)
|
|
73.65
|
|
|
Nonvested at February 1, 2019
|
329
|
|
|
$
|
74.95
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
Statutory federal income tax rate
1
|
21.0
|
%
|
|
33.7
|
%
|
|
35.0
|
%
|
State income taxes, net of federal tax benefit
|
4.8
|
|
|
2.9
|
|
|
3.6
|
|
Valuation allowance - Australian joint venture
|
—
|
|
|
(0.6
|
)
|
|
2.0
|
|
Goodwill impairment
|
5.5
|
|
|
—
|
|
|
—
|
|
Mexico impairment
|
1.5
|
|
|
—
|
|
|
—
|
|
Other, net
|
(1.0
|
)
|
|
1.2
|
|
|
(0.1
|
)
|
Effective tax rate
|
31.8
|
%
|
|
37.2
|
%
|
|
40.5
|
%
|
1
|
The Company utilized a blended rate in 2017 due to the Tax Cuts and Job Act enacted on December 22, 2017.
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
963
|
|
|
$
|
1,734
|
|
|
$
|
1,824
|
|
State
|
274
|
|
|
252
|
|
|
275
|
|
|||
Total current
1
|
1,237
|
|
|
1,986
|
|
|
2,099
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(102
|
)
|
|
60
|
|
|
6
|
|
|||
State
|
(55
|
)
|
|
(4
|
)
|
|
3
|
|
|||
Total deferred
1
|
(157
|
)
|
|
56
|
|
|
9
|
|
|||
Total income tax provision
|
$
|
1,080
|
|
|
$
|
2,042
|
|
|
$
|
2,108
|
|
1
|
Amounts applicable to foreign income taxes were insignificant for all periods presented.
|
(In millions)
|
February 1, 2019
|
|
|
February 2, 2018
|
|
||
Deferred tax assets:
|
|
|
|
||||
Self-insurance
|
$
|
252
|
|
|
$
|
238
|
|
Share-based payment expense
|
31
|
|
|
36
|
|
||
Deferred rent
|
58
|
|
|
66
|
|
||
Mexico impairment
|
74
|
|
|
—
|
|
||
Capital loss carryforwards
|
223
|
|
|
225
|
|
||
Net operating losses
|
239
|
|
|
213
|
|
||
Other, net
|
119
|
|
|
124
|
|
||
Total deferred tax assets
|
996
|
|
|
902
|
|
||
Valuation allowance
|
(569
|
)
|
|
(475
|
)
|
||
Net deferred tax assets
|
427
|
|
|
427
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Property
|
(76
|
)
|
|
(264
|
)
|
||
Other, net
|
(57
|
)
|
|
(23
|
)
|
||
Total deferred tax liabilities
|
(133
|
)
|
|
(287
|
)
|
||
|
|
|
|
||||
Net deferred tax asset
|
$
|
294
|
|
|
$
|
140
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Unrecognized tax benefits, beginning of year
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
3
|
|
Additions for tax positions of prior years
|
10
|
|
|
—
|
|
|
3
|
|
|||
Reductions for tax positions of prior years
|
—
|
|
|
(2
|
)
|
|
—
|
|
|||
Settlements
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||
Reductions due to a lapse in applicable statute of limitations
|
—
|
|
|
(3
|
)
|
|
—
|
|
|||
Unrecognized tax benefits, end of year
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
6
|
|
(In millions, except per share data)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Basic earnings per common share:
|
|
|
|
|
|
||||||
Net earnings attributable to Lowe's Companies, Inc.
|
$
|
2,314
|
|
|
$
|
3,447
|
|
|
$
|
3,091
|
|
Less: Net earnings allocable to participating securities
|
(7
|
)
|
|
(11
|
)
|
|
(11
|
)
|
|||
Less: Premium paid to acquire noncontrolling interest
|
—
|
|
|
—
|
|
|
(18
|
)
|
|||
Net earnings allocable to common shares, basic
|
$
|
2,307
|
|
|
$
|
3,436
|
|
|
$
|
3,062
|
|
Weighted-average common shares outstanding
|
811
|
|
|
839
|
|
|
880
|
|
|||
Basic earnings per common share
|
$
|
2.84
|
|
|
$
|
4.09
|
|
|
$
|
3.48
|
|
Diluted earnings per common share:
|
|
|
|
|
|
||||||
Net earnings attributable to Lowe's Companies, Inc.
|
$
|
2,314
|
|
|
$
|
3,447
|
|
|
$
|
3,091
|
|
Less: Net earnings allocable to participating securities
|
(7
|
)
|
|
(11
|
)
|
|
(11
|
)
|
|||
Less: Premium paid to acquire noncontrolling interest
|
—
|
|
|
—
|
|
|
(18
|
)
|
|||
Net earnings allocable to common shares, diluted
|
$
|
2,307
|
|
|
$
|
3,436
|
|
|
$
|
3,062
|
|
Weighted-average common shares outstanding
|
811
|
|
|
839
|
|
|
880
|
|
|||
Dilutive effect of non-participating share-based awards
|
1
|
|
|
1
|
|
|
1
|
|
|||
Weighted-average common shares, as adjusted
|
812
|
|
|
840
|
|
|
881
|
|
|||
Diluted earnings per common share
|
$
|
2.84
|
|
|
$
|
4.09
|
|
|
$
|
3.47
|
|
(In millions)
Fiscal Year |
Operating Leases
|
|
|
Capitalized Lease Obligations
|
|
|
Total
|
|
|||
2019
|
$
|
595
|
|
|
$
|
133
|
|
|
$
|
728
|
|
2020
|
605
|
|
|
87
|
|
|
692
|
|
|||
2021
|
564
|
|
|
90
|
|
|
654
|
|
|||
2022
|
519
|
|
|
87
|
|
|
606
|
|
|||
2023
|
473
|
|
|
86
|
|
|
559
|
|
|||
Later years
|
2,609
|
|
|
783
|
|
|
3,392
|
|
|||
Total minimum lease payments
|
$
|
5,365
|
|
|
$
|
1,266
|
|
|
$
|
6,631
|
|
Less amount representing interest
|
|
|
(492
|
)
|
|
|
|||||
Present value of minimum lease payments
|
|
|
774
|
|
|
|
|||||
Less current maturities
|
|
|
(65
|
)
|
|
|
|||||
Present value of minimum lease payments, less current maturities
|
|
|
$
|
709
|
|
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Long-term debt
|
$
|
582
|
|
|
$
|
582
|
|
|
$
|
583
|
|
Capitalized lease obligations
|
58
|
|
|
56
|
|
|
53
|
|
|||
Interest income
|
(28
|
)
|
|
(16
|
)
|
|
(12
|
)
|
|||
Interest capitalized
|
(3
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|||
Interest on tax uncertainties
|
3
|
|
|
(3
|
)
|
|
2
|
|
|||
Other
|
12
|
|
|
19
|
|
|
23
|
|
|||
Interest - net
|
$
|
624
|
|
|
$
|
633
|
|
|
$
|
645
|
|
(In millions)
|
2018
|
|
|
2017
|
|
|
2016
|
|
|||
Cash paid for interest, net of amount capitalized
|
$
|
635
|
|
|
$
|
654
|
|
|
$
|
619
|
|
Cash paid for income taxes, net
|
$
|
1,316
|
|
|
$
|
1,673
|
|
|
$
|
2,217
|
|
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Non-cash property acquisitions, including assets acquired under capital lease
|
$
|
44
|
|
|
$
|
97
|
|
|
$
|
86
|
|
Cash dividends declared but not paid
|
$
|
385
|
|
|
$
|
340
|
|
|
$
|
304
|
|
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
(Dollars in millions)
|
Total Sales
|
|
|
%
|
|
|
Total Sales
|
|
|
%
|
|
|
Total Sales
|
|
|
%
|
|
|||
Lumber & Building Materials
|
$
|
9,968
|
|
|
14
|
%
|
|
$
|
9,517
|
|
|
14
|
%
|
|
$
|
8,513
|
|
|
13
|
%
|
Appliances
|
8,391
|
|
|
12
|
|
|
7,696
|
|
|
11
|
|
|
7,037
|
|
|
11
|
|
|||
Seasonal & Outdoor Living
|
7,352
|
|
|
10
|
|
|
7,162
|
|
|
10
|
|
|
6,998
|
|
|
11
|
|
|||
Tools & Hardware
|
6,906
|
|
|
10
|
|
|
6,723
|
|
|
10
|
|
|
6,376
|
|
|
10
|
|
|||
Fashion Fixtures
|
6,351
|
|
|
9
|
|
|
6,424
|
|
|
9
|
|
|
6,303
|
|
|
10
|
|
|||
Rough Plumbing & Electrical
|
6,327
|
|
|
9
|
|
|
6,142
|
|
|
9
|
|
|
5,741
|
|
|
9
|
|
|||
Lawn & Garden
|
5,433
|
|
|
8
|
|
|
5,222
|
|
|
8
|
|
|
5,091
|
|
|
8
|
|
|||
Millwork
|
5,381
|
|
|
8
|
|
|
5,308
|
|
|
8
|
|
|
5,238
|
|
|
8
|
|
|||
Paint
|
5,263
|
|
|
7
|
|
|
5,297
|
|
|
8
|
|
|
5,171
|
|
|
8
|
|
|||
Flooring
|
4,282
|
|
|
6
|
|
|
4,363
|
|
|
6
|
|
|
4,227
|
|
|
6
|
|
|||
Kitchens
|
3,700
|
|
|
5
|
|
|
3,642
|
|
|
5
|
|
|
3,532
|
|
|
5
|
|
|||
Other
|
1,955
|
|
|
2
|
|
|
1,123
|
|
|
2
|
|
|
790
|
|
|
1
|
|
|||
Totals
|
$
|
71,309
|
|
|
100
|
%
|
|
$
|
68,619
|
|
|
100
|
%
|
|
$
|
65,017
|
|
|
100
|
%
|
|
2018
1
|
||||||||||||||
(In millions, except per share data)
|
First
|
|
|
Second
2
|
|
|
Third
3
|
|
|
Fourth
4
|
|
||||
Net sales
|
$
|
17,360
|
|
|
$
|
20,888
|
|
|
$
|
17,415
|
|
|
$
|
15,647
|
|
Gross margin
|
5,748
|
|
|
6,885
|
|
|
5,377
|
|
|
4,898
|
|
||||
Net earnings/(loss)
|
988
|
|
|
1,520
|
|
|
629
|
|
|
(824
|
)
|
||||
Basic earnings/(loss) per common share
|
1.19
|
|
|
1.86
|
|
|
0.78
|
|
|
(1.03
|
)
|
||||
Diluted earnings/(loss) per common share
|
$
|
1.19
|
|
|
$
|
1.86
|
|
|
$
|
0.78
|
|
|
$
|
(1.03
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
2017
1
|
||||||||||||||
(In millions, except per share data)
|
First
5
|
|
|
Second
6
|
|
|
Third
|
|
|
Fourth
7
|
|
||||
Net sales
|
$
|
16,860
|
|
|
$
|
19,495
|
|
|
$
|
16,770
|
|
|
$
|
15,494
|
|
Gross margin
|
5,595
|
|
|
6,420
|
|
|
5,454
|
|
|
4,964
|
|
||||
Net earnings
|
602
|
|
|
1,419
|
|
|
872
|
|
|
554
|
|
||||
Basic earnings per common share
|
0.70
|
|
|
1.68
|
|
|
1.05
|
|
|
0.67
|
|
||||
Diluted earnings per common share
|
$
|
0.70
|
|
|
$
|
1.68
|
|
|
$
|
1.05
|
|
|
$
|
0.67
|
|
1
|
In the fourth quarter of fiscal
2018
, the Company changed its method of accounting for shipping and handling costs from the Company’s stores, distribution centers, and other locations to customers. Under the new accounting principle, shipping and handling costs related to the delivery of products from the Company to customers are included in cost of sales, whereas they were previously presented in selling, general, and administrative expense, and depreciation and amortization. Amounts presented for fiscal years 2018 and 2017 reflect adjusted amounts in accordance with this accounting principle change. See Note
2
to the consolidated financial statements for additional information on the accounting principle change.
|
2
|
The second quarter of fiscal 2018 includes pre-tax charges totaling $230 million related to long lived asset impairments and discontinued projects associated with the Company’s decision to close all Orchard Supply Hardware locations.
|
3
|
The third quarter of fiscal 2018 includes the following pre-tax charges: $123 million related to accelerated depreciation and amortization, severance and lease obligation costs associated with the Company’s decision to close all Orchard Supply Hardware locations; $121 million related to long-lived asset impairment and severance costs associated with the Company’s decision to close 20 U.S. stores and 31 stores and other locations in Canada; $22 million related to long-lived asset impairments associated with the Company’s decision to exit its Mexico retail operations; and $14 million associated with long-lived asset impairments and inventory write-down related to the Company’s decision to exit certain non-core activities within its U.S. Home Improvement business.
|
4
|
The fourth quarter of fiscal 2018 includes the following pre-tax charges: $952 million of goodwill impairment associated with the Company’s Canadian operations; $222 million related to impairments associated with the Company’s decision to exit its Mexico retail operations; $208 million related primarily to lease obligation costs associated with the Company’s decision to close all Orchard Supply Hardware locations; $150 million related to accelerated depreciation, severance and lease obligation costs associated with the Company’s decision to close 20 U.S. stores and 31 stores and other locations in Canada; $32 million related to the Company’s decision to exit certain non-core activities within its U.S. home improvement business; and $13 million related of severance costs associated with the elimination of the Project Specialists Interiors position.
|
5
|
The first quarter of fiscal 2017 includes a $464 million pre-tax loss on extinguishment of debt in connection with a $1.6 billion cash tender offer.
|
6
|
The second quarter of fiscal 2017 includes a $96 million gain from the sale of the Company’s interest in its Australian joint venture with Woolworths.
|
7
|
The fourth quarter of fiscal 2017 includes the $20 million net impact associated with the Tax Cuts and Jobs Act of 2017 and $66 million from a one-time cash bonus to eligible hourly employees attributable to the passage of the Tax Cuts and Jobs Act of 2017.
|
|
|
Page No.
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
(In millions)
|
Balance at beginning of period
|
|
|
Charges to costs
and expenses
|
|
|
|
|
Deductions
|
|
|
|
|
Balance at end of period
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
February 1, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reserve for loss on obsolete inventory
|
$
|
77
|
|
|
$
|
1
|
|
|
1
|
|
$
|
—
|
|
|
|
|
$
|
78
|
|
Reserve for inventory shrinkage
|
212
|
|
|
478
|
|
|
|
|
(468
|
)
|
|
2
|
|
222
|
|
||||
Reserve for sales returns
|
71
|
|
|
123
|
|
|
3
|
|
—
|
|
|
|
|
194
|
|
||||
Deferred tax valuation allowance
|
475
|
|
|
94
|
|
|
4
|
|
—
|
|
|
|
|
569
|
|
||||
Self-insurance liabilities
|
890
|
|
|
1,530
|
|
|
|
|
(1,467
|
)
|
|
5
|
|
953
|
|
||||
Reserve for exit activities
|
60
|
|
|
384
|
|
|
|
|
(83
|
)
|
|
6
|
|
361
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
February 2, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reserve for loss on obsolete inventory
|
$
|
59
|
|
|
$
|
18
|
|
|
1
|
|
$
|
—
|
|
|
|
|
$
|
77
|
|
Reserve for inventory shrinkage
|
189
|
|
|
456
|
|
|
|
|
(433
|
)
|
|
2
|
|
212
|
|
||||
Reserve for sales returns
|
71
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
71
|
|
||||
Deferred tax valuation allowance
|
578
|
|
|
—
|
|
|
|
|
(103
|
)
|
|
4
|
|
475
|
|
||||
Self-insurance liabilities
|
831
|
|
|
1,547
|
|
|
|
|
(1,488
|
)
|
|
5
|
|
890
|
|
||||
Reserve for exit activities
|
66
|
|
|
19
|
|
|
|
|
(25
|
)
|
|
6
|
|
60
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
February 3, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reserve for loss on obsolete inventory
|
$
|
46
|
|
|
$
|
13
|
|
|
1
|
|
$
|
—
|
|
|
|
|
$
|
59
|
|
Reserve for inventory shrinkage
|
171
|
|
|
397
|
|
|
|
|
(379
|
)
|
|
2
|
|
189
|
|
||||
Reserve for sales returns
|
66
|
|
|
5
|
|
|
3
|
|
—
|
|
|
|
|
71
|
|
||||
Deferred tax valuation allowance
|
447
|
|
|
131
|
|
|
4
|
|
—
|
|
|
|
|
578
|
|
||||
Self-insurance liabilities
|
883
|
|
|
1,418
|
|
|
|
|
(1,470
|
)
|
|
5
|
|
831
|
|
||||
Reserve for exit activities
|
67
|
|
|
47
|
|
|
|
|
(48
|
)
|
|
6
|
|
66
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Represents the net increase/(decrease) in the required reserve based on the Company’s evaluation of obsolete inventory.
|
2
|
Represents the actual inventory shrinkage experienced at the time of physical inventories.
|
3
|
Represents the net increase in the required reserve based on the Company’s evaluation of anticipated merchandise returns. The Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606), effective February 3, 2018. Under ASU 2014-09, the sales returns reserve is presented on a gross basis, with a separate asset and liability in the consolidated balance sheet. Reporting periods prior to the adoption of ASU 2014-09 reflect the sales returns reserve on a net basis. For fiscal year 2018, the net increase in the reserve is primarily due to the change from net presentation to gross presentation related to the adoption of the revenue recognition standard, as well as changes in the Company’s evaluation of anticipated merchandise returns.
|
4
|
Represents an increase/(decrease) in the required reserve based on the Company’s evaluation of deferred tax assets.
|
5
|
Represents claim payments for self-insured claims.
|
6
|
Represents lease payments, net of sublease income.
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
2.1
|
|
|
10-K
|
|
001-07898
|
|
2.1
|
|
March 29, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
3.1
|
|
|
10-Q
|
|
001-07898
|
|
3.1
|
|
September 1, 2009
|
|
|
|
|
|
|
|
|
|
|
|
|
3.2
|
|
|
8-K
|
|
001-07898
|
|
3.1
|
|
January 28, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
4.1
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
December 15, 1995
|
|
|
|
|
|
|
|
|
|
|
|
|
4.2
|
|
|
8-K
|
|
001-07898
|
|
4.2
|
|
February 20, 1998
|
|
|
|
|
|
|
|
|
|
|
|
|
4.3
|
|
|
10-K
|
|
001-07898
|
|
10.13
|
|
April 19, 1999
|
|
|
|
|
|
|
|
|
|
|
|
|
4.4
|
|
|
10-K
|
|
001-07898
|
|
10.19
|
|
April 19, 1999
|
|
|
|
|
|
|
|
|
|
|
|
|
4.5
|
|
|
10-K
|
|
001-07898
|
|
4.5
|
|
April 3, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
4.6
|
|
|
S-3 (POSASR)
|
|
333-137750
|
|
4.5
|
|
October 10, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
4.7
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
September 11, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
4.8
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
April 15, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
4.9
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
November 22, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
4.10
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
November 23, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
4.11
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
April 23, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
4.12
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
September 11, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
4.13
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
September 10, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
4.14
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
September 16, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
4.15
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
April 20, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
4.16
|
|
|
8-K
|
|
001-07898
|
|
4.1
|
|
May 3, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
4.17
|
|
|
8-K
|
|
001-07898
|
|
10.1
|
|
September 12, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
4.18
|
|
|
8-K
|
|
001-07898
|
|
10.2
|
|
September 12, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.1
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
December 2, 2008
|
|
|
|
|
|
|
|
|
|
|
|
|
10.2
|
|
|
10-K
|
|
001-07898
|
|
10.21
|
|
March 30, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
10.3
|
|
|
DEF 14A
|
|
001-07898
|
|
Appendix B
|
|
April 13, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
10.4
|
|
|
S-8
|
|
333-34631
|
|
4.2
|
|
August 29, 1997
|
|
|
|
|
|
|
|
|
|
|
|
|
10.5
|
|
|
10-K
|
|
001-07898
|
|
10.16
|
|
April 19, 1999
|
|
|
|
|
|
|
|
|
|
|
|
|
10.6
|
|
|
10-K
|
|
001-07898
|
|
10.17
|
|
April 19, 1999
|
|
|
|
|
|
|
|
|
|
|
|
|
10.7
|
|
|
10-K
|
|
001-07898
|
|
10.25
|
|
March 29, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
10.8
|
|
|
10-K
|
|
001-07898
|
|
10.22
|
|
March 31, 2009
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
10.9
|
|
|
10-Q
|
|
001-07898
|
|
10.2
|
|
December 12, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
10.10
|
|
|
10-K
|
|
001-07898
|
|
10.10
|
|
March 29, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
10.11
|
|
|
10-K
|
|
001-07898
|
|
10.11
|
|
March 29, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
10.12
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
December 1, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
10.13
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
September 4, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
10.14
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
December 3, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
10.15
|
|
|
10-K
|
|
001-07898
|
|
10.1
|
|
March 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
10.16
|
|
|
10-K
|
|
001-07898
|
|
10.16
|
|
April 4, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
10.17
|
|
|
10-Q
|
|
001-07898
|
|
10.2
|
|
September 4, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
10.18
|
|
|
10-Q
|
|
001-07898
|
|
10.2
|
|
September 3, 2008
|
|
|
|
|
|
|
|
|
|
|
|
|
10.19
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
June 4, 2004
|
|
|
|
|
|
|
|
|
|
|
|
|
10.20
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
December 12, 2007
|
|
|
|
|
|
|
|
|
|
|
|
|
10.21
|
|
|
10-Q
|
|
001-07898
|
|
10.2
|
|
December 1, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
10.22
|
|
|
8-K
|
|
001-07898
|
|
10.1
|
|
June 3, 2005
|
|
|
|
|
|
|
|
|
|
|
|
|
10.23
|
|
|
8-K
|
|
001-07898
|
|
10.2
|
|
June 3, 2005
|
|
|
|
|
|
|
|
|
|
|
|
|
10.24
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
May 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
10.25
|
|
|
10-K
|
|
001-07898
|
|
10.27
|
|
April 4, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
10.26
|
|
|
10-K
|
|
001-07898
|
|
10.28
|
|
April 4, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
10.27
|
|
|
DEF 14A
|
|
001-07898
|
|
Appendix C
|
|
April 11, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
10.28
|
|
|
10-K
|
|
001-07898
|
|
10.24
|
|
March 29, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
10.29
|
|
|
10-Q
|
|
001-07898
|
|
10.1
|
|
June 6, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
10.30
|
|
|
8-K
|
|
001-07898
|
|
10.1
|
|
May 22, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.31
|
|
|
10-Q
|
|
001-07898
|
|
10.2
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.32
|
|
|
10-Q
|
|
001-07898
|
|
10.3
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.33
|
|
|
10-Q
|
|
001-07898
|
|
10.4
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.34
|
|
|
10-Q
|
|
001-07898
|
|
10.5
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.35
|
|
|
10-Q
|
|
001-07898
|
|
10.6
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.36
|
|
|
10-Q
|
|
001-07898
|
|
10.7
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.37
|
|
|
10-Q
|
|
001-07898
|
|
10.8
|
|
September 4, 2018
|
Exhibit Number
|
|
|
|
Incorporated by Reference
|
||||||
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|
|
|
|
|
|
|
|
|
|
|
10.38
|
|
|
10-Q
|
|
001-07898
|
|
10.9
|
|
September 4, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
10.39
|
|
|
10-Q
|
|
001-07898
|
|
10.10
|
|
September 4, 2018
|
|
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10.40
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10-Q
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001-07898
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10.11
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September 4, 2018
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10.41
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10-Q
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001-07898
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10.5
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December 6, 2018
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10.42
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10-Q
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001-07898
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10.6
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December 6, 2018
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10.43
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10.44
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18.1
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21.1
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23.1
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24.1
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31.1
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31.2
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32.1
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LOWE’S COMPANIES, INC.
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(Registrant)
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April 1, 2019
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By: /s/ Marvin R. Ellison
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Date
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Marvin R. Ellison
President and Chief Executive Officer
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|
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|
April 1, 2019
|
|
By: /s/ David M. Denton
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Date
|
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David M. Denton
Executive Vice President, Chief Financial Officer
|
|
|
|
April 1, 2019
|
|
By: /s/ Matthew V. Hollifield
|
Date
|
|
Matthew V. Hollifield
Senior Vice President and Chief Accounting Officer
|
/s/ Marvin R. Ellison
|
President,
Chief Executive Officer and Director
|
April 1, 2019
|
Marvin R. Ellison
|
|
Date
|
|
|
|
/s/ Raul Alvarez
|
Director
|
April 1, 2019
|
Raul Alvarez
|
|
Date
|
|
|
|
/s/ David H. Batchelder
|
Director
|
April 1, 2019
|
David H. Batchelder
|
|
Date
|
|
|
|
/s/ Angela F. Braly
|
Director
|
April 1, 2019
|
Angela F. Braly
|
|
Date
|
|
|
|
/s/ Sandra B. Cochran
|
Director
|
April 1, 2019
|
Sandra B. Cochran
|
|
Date
|
|
|
|
/s/ Laurie Z. Douglas
|
Director
|
April 1, 2019
|
Laurie Z. Douglas
|
|
Date
|
|
|
|
/s/ Richard W. Dreiling
|
Chairman of the Board
|
April 1, 2019
|
Richard W. Dreiling
|
|
Date
|
|
|
|
/s/ Marshall O. Larsen
|
Director
|
April 1, 2019
|
Marshall O. Larsen
|
|
Date
|
|
|
|
/s/ James H. Morgan
|
Director
|
April 1, 2019
|
James H. Morgan
|
|
Date
|
|
|
|
/s/ Brian C. Rogers
|
Director
|
April 1, 2019
|
Brian C. Rogers
|
|
Date
|
|
|
|
/s/ Bertram L. Scott
|
Director
|
April 1, 2019
|
Bertram L. Scott
|
|
Date
|
|
|
|
/s/ Lisa W. Wardell
|
Director
|
April 1, 2019
|
Lisa W. Wardell
|
|
Date
|
|
|
|
/s/ Eric C. Wiseman
|
Director
|
April 1, 2019
|
Eric C. Wiseman
|
|
Date
|
|
|
LOWE’S COMPANIES, INC.
|
|
|
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
Address:
|
|
|
|
LOWE’S COMPANIES, INC.
|
|
|
|
|
Richard D. Maltsbarger
|
By: /s/ Jennifer L. Weber
|
|
/s/ Richard D. Maltsbarger
|
Name: Jennifer L. Weber
|
|
|
Title: Executive Vice President, Human Resources
|
|
|
July 20, 2018
|
|
July 20, 2018
|
|
|
Witness: Sarah Webb
|
NAME AND DOING BUSINESS AS:
|
|
STATE OR JURISDICTION OF INCORPORATION
|
|
|
|
Lowe’s Home Centers, LLC
|
|
North Carolina
|
RONA, Inc.
|
|
Canada
|
Lowe’s Companies Canada ULC
|
|
Canada
|
|
|
|
All other subsidiaries were omitted pursuant to Item 601(21)(ii) of Regulation S-K under the Securities and Exchange Act of 1934, as amended.
|
Description
|
Registration
Statement Number
|
|
|
Form S-3 ASR
|
|
Lowe’s Stock Advantage Direct Stock Purchase Plan
|
333-220388
|
Debt Securities, Preferred Stock, Common Stock
|
333-226983
|
|
|
Form S-8
|
|
Lowe’s 401(k) Plan
|
33-29772
|
Lowe’s Companies, Inc. Directors’ Stock Incentive Plan
|
33-54497
|
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 Benefit Restoration Plan
|
333-97811
|
Lowe’s Companies Cash Deferral Plan
|
333-114435
|
Lowe’s Companies, Inc. 2006 Long-Term Incentive Plan
|
333-138031; 333-196513
|
Lowe’s Companies Employee Stock Purchase Plan - Stock Options for Everyone
|
333-36096; 333-143266; 333-181950
|
|
|
(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
|
(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.
|
April 1, 2019
|
|
/s/ Marvin R. Ellison
|
Date
|
|
Marvin R. Ellison
President and Chief Executive Officer
|
(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
|
(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.
|
April 1, 2019
|
|
/s/ David M. Denton
|
Date
|
|
David M. Denton
Executive Vice President, Chief Financial Officer
|
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.
|
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.
|