Home Depot Announces Q2 Earnings Results that Beat Forecast, and Lift Its 2015 Earnings and Revenue Forecasts

Home Depot Inc. announced Tuesday that an improving housing market helped it to beat quarterly sales forecasts in Q2 2015. Net income rose to $2.23 billion. Net sales rose 4.3% to $24.83 billion, beating analysts’ estimates of $24.69 billion. Same-store sales rose 4.2%.

Home Depot raised its projected sales for the year to a growth of 5.2%-6%, above its earlier 4.2%-4.8% previously projected range.

US housing starts rose to an 8-year high in July as builders increased construction of single-family homes.

"We saw balanced growth across our business resulting from strength in the core of the store as well as the continued recovery of the U.S. housing market," said Home Depot CEO Craig Menear.

Sources: Reuters, USA Today

Home Depot and Lowe's Report increased sales in first quarter, Home Depot beats all projections

In the first quarter, Home Depot Inc. increased net earnings to $1.58 billion, up 14% from $1.38 billion a year ago. Home Depot reported sales of $20.9 billion for the first quarter of fiscal 2015, up 6.1% from prior year. Same store sales rose 6.1% and comp-sales for US stores were up 7.1%.

Home Depot adjusted its earnings estimates, expecting sales to grow 4.2% to 4.8% this year. Earnings per share are expected to grow 11-12% from 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.

The rebounding housing market also helped results at Lowe’s, who reported net earnings of $673 million for the quarter, a 7.8% increase over prior year. Sales increased 5.4% to $14.1 billion. Same store sales increased 5.2%. However, this did not beat Wall Street projections.

Lowe’s is expecting to open a total of 15 to 20 home improvement and hardware stores this year.

“I am pleased that we executed well and delivered another strong quarter,” said Robert A. Niblock, Lowe’s chairman, president and CEO. “We generated comparable sales growth in all regions of the country and across all product categories, driving strong earnings per share growth."

Source: Retailing Today

KOHL’S, DILLARD’S AND NORDSTROM’S REPORT ON Q1 RESULTS – NORDSTROM REPORTS HIGH LOYALTY PROGRAM SUCCESS

Kohl’s, Dillard’s and Nordstrom’s released Q1 sales results yesterday, on the heels of announcements of Q1 losses from JC Penney and Macy’s.

Despite launching a loyalty program and expanding advertising, Kohl’s reported weak consumer spending, but did report a gain. Kohl’s reported a profit of $127 million, up slightly from $125 million a year earlier. Sales grew 1.3% to $4.2 billion. Kohl’s operated 1,164 stores this year versus 1,160 last year. Kevin Mansell, Kohl's chairman, chief executive officer and president, said: "Sales were modestly below our original expectations for the quarter, but accelerated in the March/April combined period after a weak February. We are very pleased with our earnings results, with a more balanced promotional calendar driving merchandise margin combined with strong expense control."

Dillard’s reported Q1 sales at $109.6 million compared to $111.7 million prior year. Same store sales decreased 1%. Net sales were $1.574 billion, up 1.5% from last year. Sales were strongest in junior’s and children’s apparel, followed by shoes and ladies’ apparel. Sales were weak in the home and furniture category. The company noted that sales in Texas were below company average for Q1. "We are disappointed with our first quarter performance. Our 1% sales decline hampered our ability to leverage operating expenses and to drive net income growth," said Chief Executive William Dillard. "Although inventory is higher than we would like, we believe the levels are manageable."

Nordstrom’s also reported a drop in earnings for Q1. It reported a profit of $128 million, down from $140 million a year ago. However, Nordstrom.com and NordstromRack.com had a combined 70% increase in sales. Net sales increased 9.8% and same store sale increased 4%. Nordstrom’s loyalty program contributed greatly to its results. Members shopped 3 times more frequently and spend 4 times more on average than non-members. With 4.4 million members, sales from members increased 11% in the first quarter and represented 38% of sales.

Source: Retailing Today

JCPenney and Macy's Report on Q1 Results

JC Penney Co. exceeded analysts’ estimates for Q1, showing smaller than expected losses/ Penney posted a loss of $167 million in the quarter ending May 2, compared to a net loss of $352 million Q1 2014. Women’s apparel, men’s and home were the company’s top performing merchandise divisions. Sephora inside JC Penney, available in 515 locations, also showed strong performance.

“Our exceptional customer experience, when combined with our strength in private brands, national brands and points of differentiation like Sephora inside J.C. Penney and the Disney Collection, give us confidence in our ability to earn customer loyalty and deliver on our long term goals,” he said. “In fact, based on our results to date, including a strong Easter and Mother's Day, we feel confident in raising our 2015 expectations for sales, gross margin and SG&A." The company expects same store sales to increase 4-5%.

Macy’s net income fell 13% to $193 million from $224 million in Q1 2014. Same store sales declined 0.7%.

“We fell short because of a confluence of factors,” said Terry J. Lundgren, Macy’s chairman and CEO. “Delayed merchandise shipments from the West Coast port slowdown and severe winter weather early in the quarter restrained business levels. Moreover, sales were negatively affected by lower levels of spending by international tourists visiting major U.S. cities with flagship Macy’s and Bloomingdale’s stores, including New York City, Chicago, Las Vegas and San Francisco.”

Macy’s is still pursuing a new store strategy, planning to open 32 new stores by 2018. Macy’s expects total sales growth of 1% and same store sales growth of 2% in fiscal 2015.

Source: Chain Store Age