Atlanta - The Home Depot reported a 14.3 percent increase in net earnings, to $1.4 billion, for its second fiscal quarter, ended July 31.
Net sales rose 4.2 percent to $20.2 billion year over year, and U.S. comp-store sales were up 3.5 percent.
The No. 1 home-improvement chain attributed the strong results to a rebound in its seasonal business, storm-related repairs, and strength in its core product categories.
Average ticket was up 3.3 percent to $54.04, and the number of customer transactions edged up 1.1 percent to 373 million.
"We continue to deliver a strong operating performance while also investing in customer service and our merchandising initiatives," said chairman/CEO Frank Blake, who also credited "the hard work and dedication" of the company's sales associates for the strong showing.
In a research note, Credit Suisse retail analyst Gary Balter noted that The Home Depot is widening the comp-sales and performance gap with No. 2 home-improvement chain Lowe's, which yesterday reported
for the second quarter. Balter said Home Depot's U.S. comps, higher gross margin and significantly better expense leverage all contributed to the outperformance. While its international business was much stronger than its domestic operations, the company also delivered stronger than expected cash flow, helped by an increase in accounts payable, he said.
Looking ahead, the chain is projecting a 2.5 percent increase in fiscal 2011 sales and raised its guidance on diluted earnings per share to $2.34, a 16 percent increase for the year.