Lowe's 3Q Profit Falls But Co. Sees Signs For Hope

MAE ANDERSON

NEW YORK (AP) — Lowe's Cos. said Monday it is expecting consumers will spend cautiously this holiday season on trees and gifts like power tools but said it sees signs the housing market is slowly improving.

The No. 2 home improvement retailer said Monday while reporting a lower third-quarter profit that some of the hardest-hit markets in the housing downturn improved compared with the quarter before. They include California, Florida and Arizona.

In all, 45 of 50 states showed improvement from the second quarter.

"As the economy and the housing market continue through the bottoming and recovery process, we know there will be ongoing macroeconomic hurdles to cross including declining home values and rising unemployment," Niblock said. "But we're encouraged by the signs of stabilization we're seeing in our business."

Home-improvement retailers have seen sales slip as consumers cut back on big-ticket remodeling projects amid the recession. Although the U.S. housing market is stabilizing, after a nearly three-year decline, home prices remain far below their peak.

CEO Robert Niblock said traffic was nearly flat compared with last year's third quarter, but higher than it was in this year's second quarter. Average ticket size fell 7 percent. Stronger sellers included interior paint, appliances and flooring.