Home Improvement retailer Lowe’s Canada announced November 20 that it plans to close 34 stores across Canada early in the new year, including six Alberta locations and three B.C. locations, because they are “underperforming.”
Shares in the North Carolina-based parent Lowe’s Companies Ltd. closed up nearly four per cent on the news. The venture operates more than 2,200 home improvement and hardware stores that employ approximately 300,000 associates, so the retrenchment is a tiny fraction of the company’s footprint. It has about 600 corporate and independent affiliate dealer stores in Canada.
Investor bullishness may also have stemmed from the company also announcing US$17.4 billion in quarterly net sales, which was essentially flat year over year. Net earnings increased nearly 67 per cent in the quarter to US$1 billion, from $629 million in the same period a year ago. The company also increased its earnings guidance.
Lowe’s is the second largest home-improvement retailer in the world, after Home Depot, which has been increasing sales, yet disappointed investors yesterday (November 19), when it announced earnings and guidance that failed to meet expectations and the company’s share price slumped more than 5 per cent.
The Lowe’s Canada part of Lowe’s Companies Ltd. operates banners such as Lowe’s, RONA, Réno-Dépôt, Ace and Dick’s Lumber, and it has struggled in Canada since it took over Rona in a $3.2-billion transaction in 2016.
The six stores across Alberta announced in the November 20 slate of closures are:
• Lowe’s Calgary (Shawnessy);
• RONA Airdrie;
• RONA Calgary (Midnapore);
• RONA St. Albert:
• RONA Sherwood Park; and
• RONA Edmondon (Ellerslie Road).
The three B.C. stores to close in early 2020 are:
• Lowe’s Prince George;
• RONA Surrey (Newton); and
• RONA Osoyoos.
Lowe’s Regina (North) in Saskatchewan will also close, in February 2020.
Lowe’s Cos. Ltd. has a history of announcing that it will close clusters of stores.
In November 2018, it announced plans to shut 27 stores, including nine in Quebec — most of which were branded Rona. The latest round of closures also targets Quebec the most, with 12 more stores to be shuttered in 2020. Ontario is the second-hardest hit this time around, with nine store closures.
In 2011, when the company made much fanfare about opening in New Westminster’s Queensborough district, the move followed an announcement that it would close 20 U.S. stores and lay off 1,950 employees.