HOME DEPOT, INC. Quarterly Report for Q1 Ended May 4, 2014

Summary

The Home Depot, Inc. (HD) reported strong performance in its first quarter ended May 4, 2014. Net sales grew by 2.9% to $19.7 billion, with comparable store sales increasing by 2.6%. This growth was driven by a rise in customer transactions and average ticket size, indicating healthy consumer demand for home improvement products. The company demonstrated effective cost management, with Selling, General, and Administrative (SG&A) expenses as a percentage of net sales decreasing to 21.3% from 21.9% in the prior year. This, combined with a modest increase in gross profit margin, led to a significant 8.7% rise in operating income to $2.3 billion. Diluted Earnings Per Share (EPS) also saw a substantial increase of 20.5%, reaching $1.00 compared to $0.83 in the prior year, partly boosted by a $0.04 benefit from the sale of HD Supply shares.

Key Highlights

• 1Net sales increased 2.9% year-over-year to $19.7 billion, driven by a 2.6% increase in comparable store sales.
• 2Diluted Earnings Per Share (EPS) grew by 20.5% to $1.00, compared to $0.83 in the prior year.
• 3Operating income rose by 8.7% to $2.3 billion, benefiting from improved gross margins and expense leverage.
• 4Online sales experienced robust growth, increasing approximately 39% and now representing 4.2% of total net sales.
• 5The company returned significant capital to shareholders, repurchasing $1.25 billion of common stock and paying $646 million in dividends.
• 6Cash flow from operations remained strong at $2.6 billion, supporting investment and shareholder returns.
• 7A gain of $97 million pre-tax was recognized from the sale of a portion of the company's equity in HD Supply Holdings, Inc.

Frequently Asked Questions