Home Depot Posts Higher Annual Earnings

ATLANTA-Locally based The Home Depot Inc. posted 17% higher earnings of $2.7 billion for fiscal year 2009, even though sales were down 7% over the year to $66.2 billion. This includes fourth-quarter earnings of $342 million, following a year-ago loss of $54 million, on slightly lower sales of $14.6 billion.

“Despite the tough economic environment, we were able to make solid progress against our key initiatives in 2009,” Frank Blake, Home Depot chairman and CEO, stated in a release early Tuesday morning. He added that the chain continued to restructure its distribution network last year, with its “rapid deployment centers” now serving more than 65% of its US store base.

For the coming year, Home Depot anticipates sales growth of 2.5% with a net new opening of six stores. The world’s biggest home improvement retailer has 2,244 locations, mainly in the US with others in Canada, Mexico and China.

Blake also noted that Home Depot gained a full percentage point market share from its nearest rival, Mooresville, NC-based Lowe’s Cos. Lowe’s reported a 19% decline in profit for the year to $1.8 billion, while sales were down 2% to $47.2 billion.

For the fourth quarter, earnings rose 27% to $205 million, marking its first year-over-year gain since mid-2007. Sales climbed 2% over the year to $10.2 billion.

“The worst of the economic cycle is likely behind us,” Lowe’s CEO Robert Niblock stated Monday. He noted that sales of bigger-ticket items are an encouraging sign that homeowners are willing to take on more discretionary projects.

For 2010, Lowe’s expects to open between 40 and 45 new stores, including 11 in the first quarter. Sales for the year are expected to grow 4% to 6%.