Lowe's helping hourly front-line employees fight inflation with $55M in quarterly bonuses
Workers will also receive a 20% discount on everyday household and cleaning items for a limited time
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Lowe's is doling out $55 million in quarterly bonuses in an effort to help alleviate some cost pressures its hourly front-line employees in the United States are facing due to high inflation.
"These associates have the most important jobs in our company, and we deeply appreciate everything they do to serve our customers to deliver a best-in-class experience," Lowe's president and CEO Marvin Ellison told analysts on the home improvement retailer's second quarter earnings call on Wednesday.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| LOW | LOWE'S COMPANIES INC. | 272.05 | -0.38 | -0.14% |
In addition, the company will give the employees a 20% discount on everyday household and cleaning items for a limited time.
"We will continue to look for meaningful ways to improve our associates' work-life balance, while providing them with the tools to build a career at Lowe's," Executive vice president of stores Joe McFarland added.
Earlier this month, the Labor Department reported that consumer prices rose 8.5% year over year in July, cooling slightly but still near the highest level in 40 years.
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A Lowe's spokesperson told FOX Business that the "Winning Together" profit-sharing bonus will be paid to front-line store, supply chain and contact center associates on Sept. 9. The spokesperson declined to disclose how much each employee would receive in their individual payout.
An employee helps a customer in a checkout line at a Lowe's store in Louisville, Kentucky, on Tuesday, Feb. 26, 2019. ((Photographer: Luke Sharrett/Bloomberg via Getty Images) / Getty Images)
Lowe's currently employs more than 300,000 associates, according to the company's website.
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The move comes after Lowe's reported net income of $3 billion, in line with prior-year results, and diluted earnings per share of $4.67, up from $4.25 per share in the second quarter of 2021. Total sales for the second quarter were $27.5 billion, compared to $27.6 billion in the second quarter of 2021.
Though overall comparable sales fell 0.3%, the company's home improvement business saw comparable sales growth of 0.2% during the second quarter. DIY sales, which came in lower than expected in the second quarter, were impacted by the shortened spring and lower demand in certain discretionary categories, which was partially offset by a 13% increase in Pro customer sales.
A Lowe's store in Livermore, California, US, on Wednesday, May 11, 2022. (Photographer: David Paul Morris/Bloomberg via Getty Images) ((Photographer: David Paul Morris/Bloomberg via Getty Images) / Getty Images)
Looking ahead, the company is forecasting that its total sales for full year 2022 will be near the bottom of its guidance range of approximately $97 billion to $99 billion. Comparable sales growth is expected to be toward the bottom end of the company's guidance of a decline of 1% to an increase 1% for the year.
Meanwhile, the company expects diluted earnings per share for the year to be at the top end of its guidance range of $13.10 to $13.60 and its operating margin to be at the top end of its range of 12.8% to 13% for the full year.
As of the time of publication, shares of Lowe's are down approximately 15% year to date.