Lowe's CEO says Rona would be 'good fit'
The CEO of U.S. home improvement retailer Lowe’s, Robert Niblock, said Monday that an acquisition of Quebec-based Rona would be a good fit with his firm’s plans to increase its international scope.
Niblock, in a conference call with analysts, did not directly mention the controversy over his firm’s $1.8-billion offer for Rona, made on July 31.
But he did allow that splitting Lowe’s management into U.S. and international teams could be a possibility.
Niblock said Lowe’s recognizes that "market and cultural differences" require different approaches.
Rona has rejected the offer, which has become an election issue in Quebec. The provincial government has said it opposes having the company fall into foreign hands.
Niblock’s comments came as Lowe’s posted a 10 per cent drop in second-quarter net income, hurt by a timing shift and a charge tied to job cuts. Its performance missed Wall Street's expectations.
The firm also lowered its fiscal 2012 earnings and revenue outlooks.
Lowe’s Cos. earned $747-million US, or 64 cents per share, for the period ended Aug. 3. That’s down from $830-million, or 64 cents per share, a year ago.
Fiscal 2012 has one less week than last year. The timing shift lowered earnings by about 3 cents per share. Removing a charge tied to previously announced job cuts and the impact of the timing shift, earnings were 68 cents per share.
Revenue fell two per cent to $14.25-billion from $14.54-billion. Lowe’s said that the timing shift accounted for 1.8 percentage points of the decline.
Analysts polled by FactSet expected earnings of 70 cents per share on revenue of $14.44 billion.
With files from the Associated Press