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Home Depot Reports Lower Q4, Annual Sales, Earnings

Atlanta — Home Depot reported lower net earnings but slightly higher sales in its fiscal fourth quarter, but lower sales and net earnings for the year, both of which ended Feb. 3.

Consolidated net earnings for the quarter were $671 million compared with $925 million in the same period in fiscal 2006. Sales for the fourth quarter totaled $17.7 billion, a 1.5 percent increase from the fourth quarter of fiscal 2006.

The fourth quarter of 2007 consisted of 14 weeks compared with 13 weeks for the prior year. The 14th week added about $1.1 billion in sales for the quarter and the year. Excluding the 14th week, fourth-quarter sales declined by 4.7 percent compared with the fourth quarter of 2006.

Comp-store sales for the quarter declined 8.3 percent. The additional week had no impact on comparable sales performance for the quarter or the year.

For fiscal 2007, Home Depot saw consolidated net earnings of $4.4 billion, compared with $5.8 billion in fiscal 2006. Excluding the 53rd week, consolidated earnings declined by 16.5 percent. Sales for fiscal 2007 were $77.3 billion, 2.1 percent below fiscal 2006. Excluding the 53rd week, sales for fiscal 2007 decreased by 3.5 percent from fiscal 2006. Comp-store sales for the year declined 6.7 percent.

“This was a difficult year financially, but I believe the progress we made on our key priorities set the foundation for the long term health of our company,” said Frank Blake, chairman/CEO.

In its 2008 financial outlook, Home Depot is predicting a total sales decline of 4 percent to 5 percent, with negative comps in the mid- to high-single-digit range, flat to slightly positive gross margin expansion and 55 new store openings with five store relocations.