Lowe's announces it will award $55 million in bonuses, as well as in-store discounts, to hourly workers to ease the impact of inflation. File photo by Joe Marino/UPI | License Photo
Aug. 17 (UPI) -- Lowe's Home Improvement plans to give its front-line workers $55 million in bonuses, as well as in-store discounts, to take the pinch off inflation.
Lowe's announced the employee rewards, which include 20% discounts off household and cleaning items, as the home improvement chain released its second quarter earnings Wednesday.
"To help our hourly front-line associates during this period of high inflation, we are awarding an incremental bonus of $55 million," Marvin Ellison, Lowe's chairman, president and CEO, said in a statement. "I'd like to thank our associates for their continued hard work and dedication."
"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," Joe McFarland, Lowe's executive vice president, said during Wednesday's earnings call which outlined mixed results for the second quarter.
Lowe's reported lower-than-expected sales, the result of a shortened spring and lower demand, which were offset by improved operations for net earnings of $3.0 billion, in line with previous years.
"I am pleased that our team drove operating margin improvement and effectively managed inventory despite lower-than-expected sales -- a clear reflection of our relentless focus on operating discipline and productivity," Marvin Ellison, Lowe's chairman, president and CEO, said in a statement.
Lowe's blamed lower spring sales on inflation as do-it-yourself customers cut back on discretionary purchases. Many items popular during the pandemic, such as freezers, failed to sell as did seasonal products like patio furniture and grills.
While do-it-yourself purchases declined, Lowe's saw an increase in sales to contractors and electricians. Ellison credits the company's new loyalty programs for driving repeat visits from professional builders and remodelers.
"We remain confident in the long-term strength of the home improvement market and our ability to take share," Ellison said.
Lowe's competitor Home Depot reported its highest quarterly sales and earnings in the company's history as it released its second quarter report Tuesday, with net earnings of $5.2 billion.