HD
$275.59
Home Depot
$7.25
2.70%
Earnings Details
3rd Quarter October 2020
Tuesday, November 17, 2020 6:00:00 AM
Tweet Share Watch
Summary

Home Depot Beats

Home Depot (HD) reported 3rd Quarter October 2020 earnings of $3.18 per share on revenue of $33.5 billion. The consensus earnings estimate was $3.08 per share on revenue of $31.4 billion. The Earnings Whisper number was $3.15 per share. Revenue grew 23.2% on a year-over-year basis.

Home Depot, Inc., is a home improvement retailer. Its stores sell an assortment of building materials, home improvement and lawn and garden products and provide a number of services.

Results
Reported Earnings
$3.18
Earnings Whisper
$3.15
Consensus Estimate
$3.08
Reported Revenue
$33.54 Bil
Revenue Estimate
$31.44 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

The Home Depot Announces Third Quarter Results; Plans to Invest Approximately $1 Billion in Annualized Permanent Compensation Enhancements for Frontline, Hourly Associates

ATLANTA, Nov. 17, 2020 /CNW/ -- The Home Depot®, the world's largest home improvement retailer, today reported sales of $33.5 billion for the third quarter of fiscal 2020, an increase of $6.3 billion, or 23.2 percent from the third quarter of fiscal 2019. Comparable sales for the third quarter of fiscal 2020 were positive 24.1 percent, and comparable sales in the U.S. were positive 24.6 percent.

Net earnings for the third quarter of fiscal 2020 were $3.4 billion, or $3.18 per diluted share, compared with net earnings of $2.8 billion, or $2.53 per diluted share, in the same period of fiscal 2019. For the third quarter of fiscal 2020, diluted earnings per share increased 25.7 percent from the same period in the prior year.

"The third quarter was another exceptional quarter for The Home Depot as we saw the continuation of outsized demand for home improvement projects, which has led to sales growth of more than $15 billion through the first nine months of the year," said Craig Menear, chairman and CEO. "Our ability to effectively adapt to this high-demand environment is a testament to both the investments we have made in the business as well as our associates' focus on customers. We continue to lean into these investments because we believe they are critical in enabling market share growth in any economic environment. I am proud of the resilience and strength our associates have continued to demonstrate, and I would like to thank them and our supplier partners," said Menear.

Investment in Associates

Throughout the COVID-19 pandemic, The Home Depot has taken significant actions to support associates, including expanded paid time off for all hourly associates to use at their discretion and the implementation of a temporary weekly bonus program. The Company is now transitioning from these temporary programs to invest in permanent compensation enhancements for frontline, hourly associates. This will result in approximately $1 billion of incremental compensation on an annualized basis.  

The Home Depot will conduct a conference call today at 9 a.m. ET to discuss information included in this news release and related matters. The conference call will be available in its entirety through a webcast and replay at ir.homedepot.com/events-and-presentations.

At the end of the third quarter, the Company operated a total of 2,295 retail stores in all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. The Company employs more than 400,000 associates. The Home Depot's stock is traded on the New York Stock Exchange (NYSE: HD) and is included in the Dow Jones industrial average and Standard & Poor's 500 index.

Certain statements contained herein constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements may relate to, among other things, the impact on our business, operations and financial results of the COVID-19 pandemic (which, among other things, may affect many of the items listed below); the demand for our products and services; net sales growth; comparable sales; effects of competition; implementation of store, interconnected retail, supply chain and technology initiatives; inventory and in-stock positions; state of the economy; state of the housing and home improvement markets; state of the credit markets, including mortgages, home equity loans and consumer credit; impact of tariffs; issues related to the payment methods we accept; demand for credit offerings; management of relationships with our associates, suppliers and vendors; international trade disputes, natural disasters, public health issues (including pandemics and related quarantines, shelter-in-place and other governmental orders, and similar restrictions), and other business interruptions that could disrupt supply or delivery of, or demand for, the Company's products or services; continuation of share repurchase programs; net earnings performance; earnings per share; dividend targets; capital allocation and expenditures; liquidity; return on invested capital; expense leverage; stock-based compensation expense; commodity price inflation and deflation; the ability to issue debt on terms and at rates acceptable to us; the impact and expected outcome of investigations, inquiries, claims and litigation; the effect of accounting charges; the effect of adopting certain accounting standards; the impact of regulatory changes; store openings and closures; guidance for fiscal 2020 and beyond; financial outlook; and the integration of acquired companies into our organization and the ability to recognize the anticipated synergies and benefits of those acquisitions. Forward-looking statements are based on currently available information and our current assumptions, expectations and projections about future events. You should not rely on our forward-looking statements. These statements are not guarantees of future performance and are subject to future events, risks and uncertainties – many of which are beyond our control, dependent on the actions of third parties, or are currently unknown to us – as well as potentially inaccurate assumptions that could cause actual results to differ materially from our expectations and projections. These risks and uncertainties include, but are not limited to, those described in Item 1A, "Risk Factors," and elsewhere in our Annual Report on Form 10-K for our fiscal year ended February 2, 2020 and our Quarterly Report on Form 10-Q for the fiscal quarter ended August 2, 2020.

Forward-looking statements speak only as of the date they are made, and we do not undertake to update these statements other than as required by law. You are advised, however, to review any further disclosures we make on related subjects in our periodic filings with the Securities and Exchange Commission.

 

THE HOME DEPOT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

 




Three Months Ended




Nine Months Ended



in millions, except per share data

November 1,
2020


November 3,
2019


% Change


November 1,
2020


November 3,
2019


% Change

Net sales

$

33,536



$

27,223



23.2

%


$

99,849



$

84,443



18.2

%

Cost of sales

22,080



17,836



23.8



65,827



55,607



18.4


Gross profit

11,456



9,387



22.0



34,022



28,836



18.0


Operating expenses:












Selling, general and administrative

6,076



4,942



22.9



18,260



14,926



22.3


Depreciation and amortization

528



498



6.0



1,567



1,470



6.6


Total operating expenses

6,604



5,440



21.4



19,827



16,396



20.9


Operating income

4,852



3,947



22.9



14,195



12,440



14.1


Interest and other (income) expense:












Interest and investment income

(11)



(22)



(50.0)



(37)



(56)



(33.9)


Interest expense

340



302



12.6



1,010



892



13.2


Interest and other, net

329



280



17.5



973



836



16.4


Earnings before provision for income taxes

4,523



3,667



23.3



13,222



11,604



13.9


Provision for income taxes

1,091



898



21.5



3,213



2,843



13.0


Net earnings

$

3,432



$

2,769



23.9

%


$

10,009



$

8,761



14.2

%













Basic weighted average common shares

1,073



1,089



(1.5)

%


1,074



1,096



(2.0)

%

Basic earnings per share

$

3.20



$

2.54



26.0



$

9.32



$

7.99



16.6














Diluted weighted average common shares

1,078



1,094



(1.5)

%


1,078



1,100



(2.0)

%

Diluted earnings per share

$

3.18



$

2.53



25.7



$

9.28



$

7.96



16.6















Three Months Ended




Nine Months Ended



Selected Sales Data (1)

November 1,
2020


November 3,
2019


% Change


November 1,
2020


November 3,
2019


% Change

Customer transactions (in millions)

453.2



400.9



13.0

%


1,339.5



1,246.4



7.5

%

Average ticket

$

72.98



$

66.36



10.0



$

73.90



$

67.00



10.3


Sales per retail square foot

$

552.85



$

449.17



23.1



$

549.26



$

464.68



18.2


__________
(1)  Selected Sales Data does not include results for the legacy Interline Brands business, now operating as a part of The Home Depot Pro.

 

THE HOME DEPOT, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

in millions

November 1,
2020


November 3,
2019


February 2,
2020

Assets






Current assets:






Cash and cash equivalents

$

14,652



$

2,193



$

2,133


Receivables, net

2,666



2,231



2,106


Merchandise inventories

16,155



15,711



14,531


Other current assets

1,032



1,039



1,040


Total current assets

34,505



21,174



19,810


Net property and equipment

23,848



22,472



22,770


Operating lease right-of-use assets

5,433



5,638



5,595


Goodwill

2,236



2,253



2,254


Other assets

897



772



807


Total assets

$

66,919



$

52,309



$

51,236








Liabilities and Stockholders' Equity






Current liabilities:






Short-term debt

$



$

695



$

974


Accounts payable

12,899



9,240



7,787


Accrued salaries and related expenses

2,176



1,467



1,494


Current installments of long-term debt

2,491



1,818



1,839


Current operating lease liabilities

842



828



828


Other current liabilities

6,987



5,517



5,453


Total current liabilities

25,395



19,565



18,375


Long-term debt, excluding current installments

32,831



26,597



28,670


Long-term operating lease liabilities

4,880



5,113



5,066


Other liabilities

2,278



2,116



2,241


Total liabilities

65,384



53,391



54,352


Total stockholders' equity (deficit)

1,535



(1,082)



(3,116)


Total liabilities and stockholders' equity

$

66,919



$

52,309



$

51,236


 

THE HOME DEPOT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 


Nine Months Ended

in millions

November 1,
2020


November 3,
2019

Cash Flows from Operating Activities:




Net earnings

$

10,009



$

8,761


Reconciliation of net earnings to net cash provided by operating activities:




Depreciation and amortization

1,853



1,701


Stock-based compensation expense

234



197


Changes in working capital

5,348



(37)


Changes in deferred income taxes

(86)



107


Other operating activities

57



64


Net cash provided by operating activities

17,415



10,793






Cash Flows from Investing Activities:




Capital expenditures

(1,503)



(1,891)


Proceeds from sales of property and equipment

55



21


Other investing activities

(3)



(10)


Net cash used in investing activities

(1,451)



(1,880)






Cash Flows from Financing Activities:




Repayments of short-term debt, net

(974)



(644)


Proceeds from long-term debt, net of discounts and premiums

4,960



1,404


Repayments of long-term debt

(1,836)



(1,046)


Repurchases of common stock

(791)



(3,909)


Proceeds from sales of common stock

185



185


Cash dividends

(4,837)



(4,477)


Other financing activities

(132)



(120)


Net cash used in financing activities

(3,425)



(8,607)


Change in cash and cash equivalents

12,539



306


Effect of exchange rate changes on cash and cash equivalents

(20)



109


Cash and cash equivalents at beginning of period

2,133



1,778


Cash and cash equivalents at end of period

$

14,652



$

2,193


___________
Note: Effective February 3, 2020, we reclassified cash flows relating to book overdrafts from financing to operating activities for all periods presented on the Condensed Consolidated Statements of Cash Flows. The amounts of these reclassifications were not material.

 

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/the-home-depot-announces-third-quarter-results-plans-to-invest-approximately-1-billion-in-annualized-permanent-compensation-enhancements-for-frontline-hourly-associates-301174103.html

SOURCE The Home Depot