Buoyant housing market can’t hide Home Depot’s hacking scars
Home Depot Inc. (HD) said Tuesday its sales and profits in the three months to May both topped forecasts, allowing it to raise its guidance for the rest of the year.
However, its shares fell in pre-market trading as the better-than-expected figures failed to include an update on the losses expected from the disastrous customer data breach it suffered last September.
“Other than $7 million of net breach-related costs contained in the Company’s first quarter fiscal 2015 earnings, at this time the Company is not able to estimate the costs, or a range of costs, related to the breach,” Home Depot said in an earnings release. It warned that a whole range of liabilities related to that incident could have a “material adverse effect” on its results, and that it may take more than a year to digest its full cost (read more on the lawsuits it’s facing here).
On the operating side, at least, things were bright. Earnings per share rose to $1.21 from $1.00 a year earlier, with about 5c coming in the shape of a settlement of a tax audit. Sales rose 6.1% from a year earlier to $20.9 billion, with U.S. sales growing faster than other markets, at a clip of 7.1%.
Chairman and CEO Craig Menear said the company had experienced “a more normal spring across much of the country and continued recovery of the U.S. housing market.”
Home Depot said that, based on the first quarter of its 2015 fiscal year, it now expects per-share earnings to rise 11%-12% on a fully-diluted basis for the year overall, and for comparable store sales to to rise between 4% and 4.6%.