Home Depot posts strong results
America’s biggest home improvement retailer stuck to its outlook for all of 2014, but said that it could not account for all possible losses from a data breach it revealed in September that affected 56 million debit and credit cards.
For now, the company is putting those costs at $US28 million ($A30 million) pretax for the most recent quarter, and $US34 million as it pertains to its guidance for 2014.
Home Depot said on Monday during a call with investors that it anticipates a fourth quarter breach related expense of about $US27 million, but only about $US6 million after insurance.
The company has a $US100 million insurance policy for breach related expenses, according to CFO, Carol Tome.
Accounting for all breach related expenses, the company on Monday projected operating expenses this year to grow at about 27 per cent of its overall sales growth rate.
For the three months ended November 2, Home Depot earned $US1.54 billion, or $US1.15 per share.
That compares with $US1.35 billion, or 95 US cents per share, a year earlier.
The housing sector had been hit hard early in the year by both bad weather and tight conditions in the market due to rising mortgage rates and a tight supply of homes.
That dragged down the earnings of home improvement retailers, yet Home Depot appears to be distancing itself from those early rough months, beating Wall Street’s per share expectations by a couple cents.
CEO Craig Menear, said online sales rose nearly 40 per cent in the quarter, with increased traffic and more online orders being picked up in stores during the period.