The Atlanta-based home improvement giant reiterated itsintention to open 55 new stores worldwide, including 36 in the US,through the current fiscal year while growing its square footage byapproximately 1.5% annually, starting in fiscal 2009. At the sametime, the company will record a $400-million charge related tocapitalized development costs associated with canceled futureopenings, and reduce aggregate new store capital spending by $1billion over the next three years.

"We will invest in our core retail business, in this case ourexisting stores, which drive our most profitable sales," FrankBlake, chairman and CEO, stated in a release. He noted that thecompany's total capital spending for the current fiscal year isprojected to be approximately $2.3 billion, less than two-thirds oflast year's amount.

Wall Street analysts say the moves announced Thursday are thecorrect course of action given the continuing national housingslump, a key contributor to current economic turmoil. They point toCommerce Department estimates that investment in existingresidential real estate was off by nearly 27% through this year'sfirst quarter.