Home Depot nails it in the first quarter

As other major retailers report sluggish sales, home improvement stores such as Home Depot Inc. are benefitting from rebounds in the housing market and the weather.

At Home Depot Inc. in the first quarter, net earnings increased to $1.58 billion, up 14% from $1.38 billion in the first quarter a year ago.



The Home Depot reported sales of $20.9 billion for the first quarter of fiscal 2015, a 6.1% increase from the first quarter of fiscal 2014.



"We had a stronger-than-expected start to the year as we experienced a more normal spring across much of the country and continued recovery of the U.S. housing market," said Craig Menear, chairman, CEO and president of the Atlanta-based retailer.



Same-store sales for the first quarter of fiscal 2015 were positive 6.1%, and comp-sales for U.S. stores were positive 7.1%



The company's bottom line also benefited in the first quarter from a $71 million tax-audit settlement.



Looking ahead, Home Depot adjusted upward its expectations for sales and earnings. It now expects sales will grow 4.2% to 4.8% this year, and comp-store sales will be positive 4.0% to 4.6%. Earnings per share are expected to grow 11% to 12% from fiscal 2014.



Amid the strong performance and positive numbers, the impact of the company's data breach discovered in September 2014 remains something of a riddle.



"Other than $7 million of net breach-related costs contained in the company's first quarter fiscal 2015 earnings, at this time the company is not able to estimate the costs, or a range of costs, related to the breach," according to the release announcing the first-quarter performance.



The company pointed to a long list of possible costs related to the breach, including reimbursements of credit card fraud and card reissuance costs, current and future civil litigation, legal fees, consultant fees and remediation activities.



At the end of the quarter, The Home Depot operated a total of 2,270 retail stores.