Home Depot boosts earnings 12% in first quarter
Atlanta-based Home Depot reported first quarter earnings of $812 million, up 12% from earnings of $725 million in the first quarter last year.
Sales declined 0.2% to $16.8 billion, while comparable store sales were negative 0.6%. Comp-store sales for stores in the United States were negative 0.7%.
"We continued to improve our business and delivered double-digit earnings growth," said Frank Blake, chairman & CEO. "Our sales declined slightly due to a slow spring selling season, but for the year we expect sales to grow in line with the guidance we previously provided."
Home Depot said it expects fiscal 2011 sales will be up approximately 2.5% from fiscal 2010. Based on its year-to-date performance, the Company raised its fiscal 2011 diluted earnings-per-share guidance and now expects diluted earnings per share to be up approximately 11.4% to $2.24 for the year.
Speaking on an earnings call, The Home Depot's EVP merchandising Craig Menear said he was pleased with the company's first-quarter performance in its core business. Despite the slight comps decline, several categories were positive -- electrical, kitchens, tools, plumbing, paint and flooring. Hardware also outperformed the company's average comp for the quarter, he said.
The retailer saw positive comps in all hard surface categories in flooring, as well as organization, interior paint and faucets. The outdoor sales were impacted by bad weather.
"Looking ahead, we continue to believe transaction improvement will lead to growth in the first half of the year, and improvement in average ticket will be more sustaining in the back half of the year," Menear said.