Improved Housing Market Helps Home Depot Boost Earnings
Source: Home Depot
Buoyed by strong sales, Home Depottoday reported an operating income of $2.3 billion in the third quarter of 2013, an increase of 32% over the $1.7 billion in operating income posted in the comparable period last year.
Home Depot reported a diluted earnings per share of $0.96 for the three months ended on Nov. 3, which represented a 50% gain relative to the $0.63 earnings per share posted in the comparable period last year. However in the third quarter last year the company did recognize a charge equivalent to $0.11 per share as a result of the closing of seven stores in China. On an equivalent basis, Home Depot recognized a 28.4% increase in diluted earnings per share.
"Our third quarter results reflect the continuing improvement in the housing market and our solid operational performance," said Home Depot's chairman and CEO Frank Blake in a statement.
Sales at Home Depot were $19.5 billion in the third quarter, an increase of 7.4% over the $18.1 billion last year. Through the first nine months of its 2013 fiscal year, the home improvement retailer has watched it sales rise by $4.6 billion, from $56.5 billion in 2012 to $61.1 billion in 2013, an increase of 8.2%.
Home Depot also disclosed it has recognized an increase in the average number of customer transactions and the average receipt, as in the third quarter of this year it saw 344.3 million customer transactions with an average ticket of $56.27. This compares to the 331 million transactions with an average ticket of $54.55 in the third quarter of last year, representing gains of 4% and 3.2%, respectively.
For the third quarter in a row Home Depot announced it also would be raising its sales guidance for comparable stores to be up 7% and its earnings per share guidance to $3.72, which would represent an increase of 24%. In the second quarter, the company guided for comparable store sales to be up 6% and earnings per share to be $3.60 . Home Depot began the year guiding with a comparable store sales growth estimation of 3% and an earnings-per-share growth of 12% to $3.37.
Home Depot also disclosed it has repurchased $6.1 billion of its shares year to date and plans to make an additional $2.1 billion in share repurchases in the fourth quarter of 2013.
The article Improved Housing Market Helps Home Depot Boost Earnings originally appeared on Fool.com.
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