ATLANTA, Nov. 15, 2011 --  The Home Depot®, the world's largest home improvement retailer, today reported third quarter of fiscal 2011 net earnings of $934 million, or $0.60 per diluted share, compared with net earnings of $834 million, or $0.51 per diluted share, in the same period of fiscal 2010. For the third quarter of fiscal 2011, diluted earnings per share increased 17.6 percent from the prior year.

Sales for the third quarter totaled $17.3 billion, a 4.4 percent increase from the third quarter of fiscal 2010. Comparable store sales for the third quarter of fiscal 2011 were positive 4.2 percent, and comp sales for U.S. stores were positive 3.8 percent.

 "Our third quarter was driven by strength in our core categories and storm-related sales as well as strong operating performance," said Frank Blake, chairman & CEO. "We will continue to invest in our core initiatives to provide customers with exceptional customer service and great product values. I would like to thank our associates for their hard work and dedication."

Dividend Increase

The Company today announced that its board of directors declared a 16 percent increase in its quarterly dividend to 29 cents per share. "As a reflection of our progress on the Company's strategic initiatives, the board increased the dividend for the second time this year and has established new capital allocation targets in support of our commitment to create value for our shareholders," said Blake. The dividend is payable on December 15, 2011, to shareholders of record on the close of business on December 1, 2011. This is the 99th consecutive quarter the Company has paid a cash dividend.

Capital Allocation Principles

Combined with today's third quarter earnings announcement, the Company updated its capital allocation principles:

Dividend Principle: Targeting a dividend payout ratio of approximately 50 percent, up from a prior target of 40 percent.

Share Repurchase Principle: After meeting the needs of the business, will use excess cash to repurchase shares, with the intent of completing the remaining $6.8 billion of share repurchases under its current authorization by the end of fiscal 2014.

Return on Invested Capital Principle: Maintain a high return on invested capital, with a goal of reaching 15 percent (before share repurchases) by the end of fiscal 2013.

Targeted Capital Structure

The Company announced that it will target a total adjusted debt/EBITDAR ratio of 2.0x. Total adjusted debt includes debt on the balance sheet plus 8x operating rents and certain contingent liabilities, while EBITDAR is defined as earnings before interest, taxes, depreciation, amortization and rent expense.

Updated Fiscal 2011 Guidance

The Company confirmed that it expects fiscal 2011 sales will be up approximately 2.5 percent from fiscal 2010. Based on its year-to-date performance and outlook for the balance of the year, the Company raised its fiscal 2011 diluted earnings-per-share guidance and now expects diluted earnings-per-share to grow by approximately 18 percent to $2.38 for the year.

The Home Depot will conduct a conference call today at 9 a.m. ET to discuss information included in this news release and related matters. The conference call will be available in its entirety through a webcast and replay at earnings.homedepot.com.

At the end of the third quarter, the Company operated a total of 2,246 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces, Mexico and China. The Company employs more than 300,000 associates. The Home Depot's stock is traded on the New York Stock Exchange (NYSE: HD) and is included in the Dow Jones industrial average and Standard & Poor's 500 index.

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