|Home Depot's 1Q net income rises, boosts outlook|
Home Depot's 1st-quarter profit up, revenue falls on slow start to spring selling season
Home Depot Inc.'s fiscal first-quarter net income rose 12 percent even as a slow start to the spring selling season pushed revenue lower. (AP Photo/Gene J. Puskar)
ATLANTA (AP) -- Home Depot Inc.'s first-quarter net income rose 12 percent even as a slow start to the spring selling season pushed revenue lower.
The country's biggest home improvement retailer also increased its full-year earnings forecast on Tuesday.
Home Depot earned $812 million, or 50 cents per share, for the period ended May 1, up from $725 million, or 43 cents per share, a year ago.
This beat the 49 cents per share analysts surveyed by FactSet expected.
The retailer's performance was helped in part by a decline in total operating expenses, which dropped to $4.41 billion from $4.49 billion.
Revenue slipped 0.2 percent to $16.82 billion, missing Wall Street's $17.06 billion estimate.
The Atlanta chain said revenue at stores open at least a year fell 0.6 percent, with U.S. stores down 0.7 percent. This figure is a key indicator of a retailer's health because it excludes results from stores opened or closed during the year.
Average ticket climbed 1.5 percent to $53.35, but the number of customer transactions dropped 1.9 percent.
Chairman and CEO Frank Blake said in a statement that sales were down due to the sluggish start to the spring selling season, which is the biggest season for the home improvement sector.
On Monday rival Lowe's Cos. said bad weather during its first quarter kept customers away from their gardens and outdoor projects. The No. 2 home improvement retailer reported its first-quarter profit and revenue fell, hindered by bad weather.
Both Home Depot and Lowe's depend on the spring selling season to give them a boost, as shoppers typically head out in droves to buy seasonal items such as flowers, patio furniture and barbecue grills. But so far this year the season has been hampered by cold and rainy weather across the northern half of the country and tornadoes in the Southeast.
Home Depot now expects fiscal 2011 earnings per share of $2.24, up from $2.20. The company maintained its guidance for a revenue increase of about 2.5 percent from 2010's $68 billion, implying revenue of approximately $69.7 billion.
Wall Street predicts earnings of $2.30 per share on revenue of $69.72 billion.