ATLANTA-Favorable sales and margins, along with controlled expenses, helped The Home Depot to record an 18.5 percent gain in first-quarter net income, to $1.2 billion.
Net sales rose 7.4 percent, to $19.1 billion, in the quarter which ended on May 5. The sales numbers included a pickup of 4.3 percent in total same-store sales, which in turn encompassed an increase of 4.8 percent in same-store sales in Home Depot’s U.S. stores. Looking further into the sales equation, Home Depot posted an increase of 2.5 percent in the number of customer transactions and a 5 percent gain in average ticket.
“In the first quarter, we saw less favorable weather compared to last year,” said Frank Blake, Home Depot’s chairman and CEO, “but we continue to see benefit from a recovering housing market that drove a stronger-than-expected start to the year for our business.”
Gross margin rose 20 basis points to 34.9 percent. Selling, general and administrative expenses were up 2.5 percent in dollars but down 107 basis points as a percentage of sales, to 21.9 percent.
Based on the first-quarter results, Home Depot said it now expects a total sales gain of about 2.8 percent for the fiscal year as a whole, including a same-store sales increase of about 4 percent.