Home Depot Q2 profit falls about 15% on Home Services

Jan

Home Depot Q2 profit falls about 15%

posted by admin in Home Depot

The weak U.S. housing market continued to hammer at The Home Depot Inc.s bottom line in the second quarter.

The Atlanta-based home improvement retailer (NYSE: HD) recorded net income of $1.6 billion on $22.2 billion in sales, compared with net income of $1.9 billion on $22.6 billion in sales in the second quarter of 2006. Second-quarter earnings fell 10 percent to 80 cents a share.

The 1.8 percent drop in sales reflects negative comparable store sales of 5.2 percent, offset in part by sales from new stores. During the second quarter, the average customer ticket was down 2.8 percent to $58.30.

While the challenging housing market continues to present us with a tough selling environment, our financial performance was in line with our expectations, said Frank Blake, chairman and CEO. We believe the housing and home improvement markets will remain soft into 2008; we will continue to invest thoughtfully for the long-term health of the business.

Through two quarters, Home Depot had net income of $2.6 billion on $40.7 billion in sales, compared with net income of $3.3 billion on $42 billion in sales in the same period of 2006. Earnings through half the year fell 16.3 percent to $1.34 a share.

As of July 30, Home Depot ran 1,923 stores in the United States, 157 stores in Canada, 63 stores in Mexico and 12 stores in China. The company also has 34 EXPO Design Center stores and 11 The Home Depot Landscape Supply stores.