ATLANTA - The Home Depot®, the world's largest home improvement retailer, today reported first quarter of fiscal 2014 net earnings of $1.4 billion, or $1.00 per diluted share, compared with net earnings of $1.2 billion, or $0.83 per diluted share, in the same period of fiscal 2013. For the first quarter of fiscal 2014, diluted earnings per share increased 20.5 percent from the same period in the prior year.
First quarter of fiscal 2014 results reflect a benefit to earnings, net of tax, of $61 million, or $0.04 per diluted share, related to the sale of a portion of the company's equity ownership in HD Supply Holdings, Inc.
Total sales for the first quarter of fiscal 2014 were $19.7 billion, a 2.9 percent increase from the first quarter of fiscal 2013. Comparable store sales for the first quarter of fiscal 2014 were positive 2.6 percent, and comp sales for the U.S. stores were positive 3.3 percent.
"The first quarter was impacted by a slow start to the spring selling season. But we had solid results in non-weather impacted markets and expect our sales for the year to grow in line with the guidance we previously provided," said Frank Blake, chairman and CEO. "I would like to thank our associates for their hard work and dedication."
Updated Fiscal 2014 Guidance
The Company reaffirmed that it expects fiscal 2014 sales will be up approximately 4.8 percent from fiscal 2013. The Company raised its fiscal 2014 diluted earnings-per-share guidance and now expects diluted earnings-per-share to be up approximately 17.6 percent to $4.42 for the year. This earnings-per-share guidance includes the $0.04 per diluted share benefit related to the sale of HD Supply common stock, the benefit of the Company's year-to-date share repurchases and the Company's intent to repurchase $3.75 billion in additional shares over the remainder of 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 first quarter, the Company operated a total of 2,263 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. 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.
THE HOME DEPOT, INC. AND SUBSIDIARIES |
||||||||||
CONSOLIDATED STATEMENTS OF EARNINGS |
||||||||||
FOR THE THREE MONTHS ENDED MAY 4, 2014 AND MAY 5, 2013 |
||||||||||
(Unaudited) |
||||||||||
(Amounts in Millions Except Per Share Data and as Otherwise Noted) |
||||||||||
Three Months Ended |
||||||||||
May 4, |
May 5, |
% Increase (Decrease) |
||||||||
NET SALES |
$ |
19,687 |
$ |
19,124 |
2.9 |
% |
||||
Cost of Sales |
12,802 |
12,445 |
2.9 |
|||||||
GROSS PROFIT |
6,885 |
6,679 |
3.1 |
|||||||
Operating Expenses: |
||||||||||
Selling, General and Administrative |
4,194 |
4,183 |
0.3 |
|||||||
Depreciation and Amortization |
414 |
402 |
3.0 |
|||||||
Total Operating Expenses |
4,608 |
4,585 |
0.5 |
|||||||
OPERATING INCOME
|
2,277 |
2,094 |
8.7 |
|||||||
Interest and Other (Income) Expense: |
||||||||||
Interest and Investment Income |
(100) |
(3) |
N/M |
|||||||
Interest Expense |
191 |
164 |
16.5 |
|||||||
Interest and Other, net |
91 |
161 |
(43.5) |
|||||||
EARNINGS BEFORE PROVISION FOR INCOME TAXES |
2,186 |
1,933 |
13.1 |
|||||||
Provision for Income Taxes |
807 |
707 |
14.1 |
|||||||
NET EARNINGS |
$ |
1,379 |
$ |
1,226 |
12.5 |
% |
||||
Weighted Average Common Shares |
1,367 |
1,468 |
(6.9) |
% |
||||||
BASIC EARNINGS PER SHARE |
$ |
1.01 |
$ |
0.84 |
20.2 |
|||||
Diluted Weighted Average Common Shares |
1,376 |
1,478 |
(6.9) |
% |
||||||
DILUTED EARNINGS PER SHARE |
$ |
1.00 |
$ |
0.83 |
20.5 |
|||||
Three Months Ended |
||||||||||
SELECTED HIGHLIGHTS |
May 4, |
May 5, |
% Increase (Decrease) |
|||||||
Number of Customer Transactions |
344.5 |
337.1 |
2.2 |
% |
||||||
Average Ticket (actual) |
$ |
57.59 |
$ |
57.24 |
0.6 |
|||||
Sales per Square Foot (actual) |
$ |
334.01 |
$ |
328.17 |
1.8 |
N/M – Not Meaningful
THE HOME DEPOT, INC. AND SUBSIDIARIES |
|||||||||||
CONSOLIDATED BALANCE SHEETS |
|||||||||||
AS OF MAY 4, 2014, MAY 5, 2013 AND FEBRUARY 2, 2014 |
|||||||||||
(Unaudited) |
|||||||||||
(Amounts in Millions) |
|||||||||||
May 4, |
May 5, |
February 2, |
|||||||||
ASSETS |
|||||||||||
Cash and Cash Equivalents |
$ |
2,511 |
$ |
4,337 |
$ |
1,929 |
|||||
Receivables, net |
1,831 |
1,658 |
1,398 |
||||||||
Merchandise Inventories |
12,343 |
11,825 |
11,057 |
||||||||
Other Current Assets |
830 |
800 |
895 |
||||||||
Total Current Assets |
17,515 |
18,620 |
15,279 |
||||||||
Property and Equipment, net |
23,238 |
23,906 |
23,348 |
||||||||
Goodwill |
1,293 |
1,187 |
1,289 |
||||||||
Other Assets |
583 |
482 |
602 |
||||||||
TOTAL ASSETS |
$ |
42,629 |
$ |
44,195 |
$ |
40,518 |
|||||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||||||
Accounts Payable |
$ |
7,739 |
$ |
7,384 |
$ |
5,797 |
|||||
Accrued Salaries and Related Expenses |
1,233 |
1,264 |
1,428 |
||||||||
Current Installments of Long-Term Debt |
34 |
1,332 |
33 |
||||||||
Other Current Liabilities |
4,259 |
4,038 |
3,491 |
||||||||
Total Current Liabilities |
13,265 |
14,018 |
10,749 |
||||||||
Long-Term Debt, excluding current installments |
14,707 |
11,460 |
14,691 |
||||||||
Other Long-Term Liabilities |
2,511 |
2,324 |
2,556 |
||||||||
Total Liabilities |
30,483 |
27,802 |
27,996 |
||||||||
Total Stockholders' Equity |
12,146 |
16,393 |
12,522 |
||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ |
42,629 |
$ |
44,195 |
$ |
40,518 |
THE HOME DEPOT, INC. AND SUBSIDIARIES |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
FOR THE THREE MONTHS ENDED MAY 4, 2014 AND MAY 5, 2013 |
|||||||
(Unaudited) |
|||||||
(Amounts in Millions) |
|||||||
Three Months Ended |
|||||||
May 4, |
May 5, |
||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|||||||
Net Earnings |
$ |
1,379 |
$ |
1,226 |
|||
Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: |
|||||||
Depreciation and Amortization |
447 |
435 |
|||||
Stock-Based Compensation Expense |
67 |
65 |
|||||
Changes in Working Capital and Other |
675 |
971 |
|||||
Net Cash Provided by Operating Activities |
2,568 |
2,697 |
|||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|||||||
Capital Expenditures |
(287) |
(278) |
|||||
Payments for Businesses Acquired, net |
— |
(13) |
|||||
Proceeds from Sales of Property and Equipment |
7 |
15 |
|||||
Net Cash Used in Investing Activities |
(280) |
(276) |
|||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|||||||
Proceeds from Long-Term Borrowings, net of discount |
— |
1,994 |
|||||
Repayments of Long-Term Debt |
(12) |
(8) |
|||||
Repurchases of Common Stock |
(1,250) |
(2,196) |
|||||
Proceeds from Sales of Common Stock |
69 |
64 |
|||||
Cash Dividends Paid to Stockholders |
(646) |
(577) |
|||||
Other Financing Activities |
133 |
134 |
|||||
Net Cash Used in Financing Activities |
(1,706) |
(589) |
|||||
Change in Cash and Cash Equivalents
|
582 |
1,832 |
|||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents |
— |
11 |
|||||
Cash and Cash Equivalents at Beginning of Period |
1,929 |
2,494 |
|||||
Cash and Cash Equivalents at End of Period |
$ |
2,511 |
$ |
4,337 |
SOURCE: The Home Depot
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