Home Depot Q4 earnings, sales tops estimates

 

The world’s largest home improvement retailer continued to ring up big numbers for the fourth quarter amid digital initiatives and the strong U.S. housing market.

The Home Depot on Tuesday posted net earnings of $1.8 billion for the quarter, up from $1.7 billion in the same quarter last year. Earnings were impacted by a combination of the Tax Cuts and Jobs Act of 2017 and a one-time bonus payment to hourly associates, the company said.

The retailer also on Tuesday raised its quarterly dividend, for the ninth-consecutive year, by 15.7 percent to $1.03 a share.

Home Depot’s net sales rose 7.5% to $23.9 billion. Same-store sales rose 7.2%, as the company pointed to a commitment to the interconnected retail experience. Customer transactions rose 2% and the average ticket increased 5.5%.

Online sales grew 21% in the quarter, and 21.5% in fiscal 2017, and now make up 6.7% of the chain’s total sales.

“Our ongoing commitment to enhance the interconnected retail experience for our customers, provide localized and innovative product and deliver best-in-class productivity resulted in record sales and net earnings for 2017,” said Craig Menear, chairman, CEO and president.

Among the digital initiatives were the implementation of a new e-commerce platform, enhanced search and mobile functionality, increased checkout speed and expanded chat functionality to improve the customer experience with online contact centers, the company said.

Senior VP of merchandising Ted Decker reported strength across the store in the fourth quarter, with the pro customer leading the charge. Lumber, electrical, and tools had double-digit comps in the quarter.

At the end of the fourth quarter, the company operated a total of 2,284 retail stores in all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.

For the full year, the Home Depot reported big numbers: total sales of $100.9 billion marked an increase of 6.7% from the prior year. Comps for U.S. stores rose 6.9%.

Looking ahead, the company expects to open three new stores in 2018, maintaining its approach to grow the business through its existing footprint. Fiscal 2018 guidance also includes comparable-store sales growth of about 5.0%.