Home Depot Announces Third Quarter Results

Q3 results reflect a pretax gain on a sale of a portion of the company's ownership in HD Supply, as well as pretax net expenses related to Home Depot's data breach.

ATLANTA — The Home Depot, the world's largest home improvement retailer, reported on Tuesday sales of $20.5 billion for the third quarter of fiscal 2014, a 5.4 percent increase from Q3 2013. Comparable store sales for the third quarter of fiscal 2014 were positive 5.2 percent, and comp sales for U.S. stores were positive 5.8 percent.

Net earnings for the third quarter were $1.5 billion, or $1.15 per diluted share, compared with net earnings of $1.4 billion for the same period of fiscal 2013. For Q3 2014, diluted earnings per share increased 21.1 percent from the same period in the prior year.

Third quarter of fiscal 2014 results reflect a pretax gain on sale of $100 million related to the sale of a portion of the company's equity ownership in HD Supply Holdings, Inc. and pretax net expenses of $28 million related to the company's data breach.

"During the quarter we saw strong performance across all geographies led by growth in transactions and continued strength in the core of the store," said Craig Menear, CEO and president. "I would like to thank our associates for their hard work and dedication to our customers, and I would like to thank our customers for their continued confidence in The Home Depot."

The company confirmed that it expects fiscal 2014 sales growth of approximately 4.8 percent. The company also confirmed that it expects fiscal 2014 diluted earnings per share to grow by 21 percent to approximately $4.54. This earnings-per-share guidance includes the benefit of the company's year-to-date share repurchases of $5.74 billion and the company's intent to repurchase an additional $1.26 billion of shares in the fourth quarter. The earnings-per-share guidance also includes an estimate of net breach-related costs of approximately $34 million for the year.

The company's fiscal 2014 diluted earnings-per-share guidance does not include an accrual for other probable losses related to the breach that cannot be estimated at this time. Other than the breach-related costs contained in the company's updated fiscal 2014 diluted earnings-per-share guidance, at this time the company is not able to estimate the costs, or a range of costs, related to the breach. Those costs may have a material adverse effect on the company's financial results in the fourth quarter of fiscal 2014 and/or future periods.

At the end of the third quarter, the company operated a total of 2,266 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.

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