Home Depot profits climb
Spring is the biggest season for home-improvement retailers, as homeowners and others work on their yards and gardens.
While the season started off a bit cold and rainy, weather improved and shoppers headed out to stores to pick up supplies. In particular, purchases over $US900 like appliances and water heaters, which account for 20 per cent of total US sales, rose 8 per cent.
“These results support the view of a continued recovery in the US home improvement market,” Frank Blake, Home Depot’s CEO, told investors during its earnings call.
Home Depot also has been helped of late by an improving US housing market.
On Tuesday the Commerce Department reported that home construction rebounded in July, rising to the fastest pace in eight months and offering hope that housing has regained momentum after two months of declines.
Home construction increased 15.7 per cent in July to a seasonally adjusted annual rate of 1.09 million homes.
Shares of Home Depot rose $US3.88, or more than 4 per cent, to $US87.47 in Tuesday trading.
For the three months ended August 3, Home Depot Inc. earned $US2.05 billion, or $US1.52 per share. A year earlier it earned $US1.8 billion, or $US1.24 per share.
Revenue climbed nearly 6 per cent to $US23.81 billion from $US22.52 billion. This beat Wall Street’s forecast of $US23.57 billion.
Online sales surged more than 38 per cent in the quarter.
Home Depot now foresees fiscal 2014 earnings of $US4.52 per share.
The chain maintained its guidance for full year sales to be up about 4.8 per cent from the previous year.