ATLANTA, Aug. 18, 2020 /CNW/ -- The Home
Depot®, the world's largest home improvement retailer,
today reported sales of $38.1 billion
for the second quarter of fiscal 2020, a 23.4 percent increase from
the second quarter of fiscal 2019. Comparable sales for the second
quarter of fiscal 2020 were positive 23.4 percent, and comparable
sales in the U.S. were positive 25.0 percent.
Net earnings for the second quarter of fiscal 2020 were
$4.3 billion, or $4.02 per diluted share, compared with net
earnings of $3.5 billion, or
$3.17 per diluted share, in the same
period of fiscal 2019. For the second quarter of fiscal 2020,
diluted earnings per share increased 26.8 percent from the same
period in the prior year.
"The investments we have made across the business have
significantly increased our agility, allowing us to respond quickly
to changes while continuing to promote a safe operating
environment. This enhanced our team's ability to work
cross-functionally to better serve our customers and deliver
record-breaking sales in the quarter," said Craig Menear, chairman, CEO and president. "We
remain focused on continuing the momentum of our One Home Depot
investment strategy that we believe will position us for continued
growth over the long-term, while at the same time maintaining
flexibility to navigate the demands of the current environment.
Through it all, we will continue to lead with our values by doing
the right thing and taking care of our people."
In the second quarter, the Company invested approximately
$480 million in additional benefits
for associates, including weekly bonuses for hourly associates in
stores and distribution centers. Year-to-date, the Company has
spent approximately $1.3 billion on
enhanced pay and benefits in response to COVID-19. Additionally,
the Company's first half performance resulted in a record payout
for Success Sharing, the Company's profit-sharing program for
hourly associates.
"I want to thank our associates for their continued focus on
serving our customers and communities as we navigate these
extraordinary circumstances together," said Menear.
Dividend Declaration
The Company today announced that its board of directors declared
a second quarter cash dividend of $1.50 per share. The dividend is payable on
September 17, 2020, to shareholders
of record on the close of business on September 3, 2020. This is the 134th
consecutive quarter the Company has paid a cash dividend.
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 second quarter, the Company operated a total
of 2,293 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
May 3, 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
|
|
|
|
Six Months
Ended
|
|
|
|
in millions,
except per share data
|
|
August 2,
2020
|
|
August 4,
2019
|
|
% Change
|
|
August 2,
2020
|
|
August 4,
2019
|
|
% Change
|
|
Net sales
|
|
$
|
38,053
|
|
|
$
|
30,839
|
|
|
23.4
|
%
|
|
$
|
66,313
|
|
|
$
|
57,220
|
|
|
15.9
|
%
|
|
Cost of
sales
|
|
25,112
|
|
|
20,407
|
|
|
23.1
|
|
|
43,747
|
|
|
37,771
|
|
|
15.8
|
|
|
Gross
profit
|
|
12,941
|
|
|
10,432
|
|
|
24.1
|
|
|
22,566
|
|
|
19,449
|
|
|
16.0
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
6,355
|
|
|
5,044
|
|
|
26.0
|
|
|
12,184
|
|
|
9,984
|
|
|
22.0
|
|
|
Depreciation and
amortization
|
|
519
|
|
|
492
|
|
|
5.5
|
|
|
1,039
|
|
|
972
|
|
|
6.9
|
|
|
Total operating
expenses
|
|
6,874
|
|
|
5,536
|
|
|
24.2
|
|
|
13,223
|
|
|
10,956
|
|
|
20.7
|
|
|
Operating
income
|
|
6,067
|
|
|
4,896
|
|
|
23.9
|
|
|
9,343
|
|
|
8,493
|
|
|
10.0
|
|
|
Interest and other
(income) expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and
investment income
|
|
(9)
|
|
|
(19)
|
|
|
(52.6)
|
|
|
(26)
|
|
|
(34)
|
|
|
(23.5)
|
|
|
Interest
expense
|
|
346
|
|
|
302
|
|
|
14.6
|
|
|
670
|
|
|
590
|
|
|
13.6
|
|
|
Interest and other,
net
|
|
337
|
|
|
283
|
|
|
19.1
|
|
|
644
|
|
|
556
|
|
|
15.8
|
|
|
Earnings before
provision for income taxes
|
|
5,730
|
|
|
4,613
|
|
|
24.2
|
|
|
8,699
|
|
|
7,937
|
|
|
9.6
|
|
|
Provision for income
taxes
|
|
1,398
|
|
|
1,134
|
|
|
23.3
|
|
|
2,122
|
|
|
1,945
|
|
|
9.1
|
|
|
Net
earnings
|
|
$
|
4,332
|
|
|
$
|
3,479
|
|
|
24.5
|
%
|
|
$
|
6,577
|
|
|
$
|
5,992
|
|
|
9.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted
average common shares
|
|
1,073
|
|
|
1,095
|
|
|
(2.0)
|
%
|
|
1,073
|
|
|
1,098
|
|
|
(2.3)
|
%
|
|
Basic earnings per
share
|
|
$
|
4.04
|
|
|
$
|
3.18
|
|
|
27.0
|
|
|
$
|
6.13
|
|
|
$
|
5.46
|
|
|
12.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average common shares
|
|
1,077
|
|
|
1,099
|
|
|
(2.0)
|
%
|
|
1,077
|
|
|
1,103
|
|
|
(2.4)
|
%
|
|
Diluted earnings per
share
|
|
$
|
4.02
|
|
|
$
|
3.17
|
|
|
26.8
|
|
|
$
|
6.11
|
|
|
$
|
5.43
|
|
|
12.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
Six Months
Ended
|
|
|
|
Selected Sales
Data (1)
|
|
August 2,
2020
|
|
August 4,
2019
|
|
% Change
|
|
August 2,
2020
|
|
August 4,
2019
|
|
% Change
|
|
Customer transactions
(in millions)
|
|
511.5
|
|
|
455.5
|
|
|
12.3
|
%
|
|
886.3
|
|
|
845.5
|
|
|
4.8
|
%
|
|
Average
ticket
|
|
$
|
74.12
|
|
|
$
|
67.31
|
|
|
10.1
|
|
|
$
|
74.37
|
|
|
$
|
67.31
|
|
|
10.5
|
|
|
Sales per retail
square foot
|
|
$
|
629.38
|
|
|
$
|
509.55
|
|
|
23.5
|
|
|
$
|
547.94
|
|
|
$
|
472.22
|
|
|
16.0
|
|
|
—————
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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
|
August 2,
2020
|
|
August 4,
2019
|
|
February
2,
2020
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
14,139
|
|
|
$
|
2,547
|
|
|
$
|
2,133
|
|
|
Receivables,
net
|
2,562
|
|
|
2,274
|
|
|
2,106
|
|
|
Merchandise
inventories
|
13,498
|
|
|
14,741
|
|
|
14,531
|
|
|
Other current
assets
|
1,162
|
|
|
1,137
|
|
|
1,040
|
|
|
Total current
assets
|
31,361
|
|
|
20,699
|
|
|
19,810
|
|
|
Net property and
equipment
|
23,387
|
|
|
22,387
|
|
|
22,770
|
|
|
Operating lease
right-of-use assets
|
5,436
|
|
|
5,789
|
|
|
5,595
|
|
|
Goodwill
|
2,233
|
|
|
2,254
|
|
|
2,254
|
|
|
Other
assets
|
932
|
|
|
881
|
|
|
807
|
|
|
Total
assets
|
$
|
63,349
|
|
|
$
|
52,010
|
|
|
$
|
51,236
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Short-term
debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
974
|
|
|
Accounts
payable
|
11,691
|
|
|
9,494
|
|
|
7,787
|
|
|
Accrued salaries and
related expenses
|
2,402
|
|
|
1,478
|
|
|
1,494
|
|
|
Current installments
of long-term debt
|
2,476
|
|
|
1,315
|
|
|
1,839
|
|
|
Current operating
lease liabilities
|
831
|
|
|
831
|
|
|
828
|
|
|
Other current
liabilities
|
6,799
|
|
|
5,680
|
|
|
5,453
|
|
|
Total current
liabilities
|
24,199
|
|
|
18,798
|
|
|
18,375
|
|
|
Long-term debt,
excluding current installments
|
32,370
|
|
|
27,064
|
|
|
28,670
|
|
|
Long-term operating
lease liabilities
|
4,895
|
|
|
5,263
|
|
|
5,066
|
|
|
Other
liabilities
|
2,299
|
|
|
2,045
|
|
|
2,241
|
|
|
Total
liabilities
|
63,763
|
|
|
53,170
|
|
|
54,352
|
|
|
Total stockholders'
(deficit) equity
|
(414)
|
|
|
(1,160)
|
|
|
(3,116)
|
|
|
Total liabilities and
stockholders' equity
|
$
|
63,349
|
|
|
$
|
52,010
|
|
|
$
|
51,236
|
|
|
THE HOME DEPOT,
INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
(Unaudited)
|
|
|
Six Months
Ended
|
|
in
millions
|
August 2,
2020
|
|
August 4,
2019
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
Net
earnings
|
$
|
6,577
|
|
|
$
|
5,992
|
|
|
Reconciliation of net
earnings to net cash provided by operating activities:
|
|
|
|
|
Depreciation and
amortization
|
1,222
|
|
|
1,107
|
|
|
Stock-based
compensation expense
|
155
|
|
|
139
|
|
|
Changes in working
capital
|
6,834
|
|
|
1,168
|
|
|
Changes in deferred
income taxes
|
13
|
|
|
58
|
|
|
Other operating
activities
|
28
|
|
|
79
|
|
|
Net cash provided by
operating activities
|
14,829
|
|
|
8,543
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
Capital
expenditures
|
(1,032)
|
|
|
(1,246)
|
|
|
Proceeds from sales
of property and equipment
|
12
|
|
|
11
|
|
|
Other investing
activities
|
—
|
|
|
(14)
|
|
|
Net cash used in
investing activities
|
(1,020)
|
|
|
(1,249)
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
Repayments of
short-term debt, net
|
(974)
|
|
|
(1,339)
|
|
|
Proceeds from
long-term debt, net of discounts and premiums
|
4,960
|
|
|
1,404
|
|
|
Repayments of
long-term debt
|
(1,806)
|
|
|
(1,030)
|
|
|
Repurchases of common
stock
|
(791)
|
|
|
(2,619)
|
|
|
Proceeds from sales
of common stock
|
164
|
|
|
157
|
|
|
Cash
dividends
|
(3,223)
|
|
|
(2,991)
|
|
|
Other financing
activities
|
(127)
|
|
|
(116)
|
|
|
Net cash used in
financing activities
|
(1,797)
|
|
|
(6,534)
|
|
|
Change in cash and
cash equivalents
|
12,012
|
|
|
760
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(6)
|
|
|
9
|
|
|
Cash and cash
equivalents at beginning of period
|
2,133
|
|
|
1,778
|
|
|
Cash and cash
equivalents at end of period
|
$
|
14,139
|
|
|
$
|
2,547
|
|
|
_________
|
|
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 Statement of Cash Flows.
The amounts of these reclassifications were not
material.
|
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SOURCE The Home Depot