The Home Depot (HD) has reported a 14.14 percent rise in profit for the quarter ended Oct. 30, 2016. The company has earned $1,969 million, or $1.60 a share in the quarter, compared with $1,725 million, or $1.35 a share for the same period last year. Revenue during the quarter grew 6.12 percent to $23,154 million from $21,819 million in the previous year period. Gross margin for the quarter expanded 6 basis points over the previous year period to 34.73 percent. Total expenses were 85.66 percent of quarterly revenues, down from 86.34 percent for the same period last year. This has led to an improvement of 68 basis points in operating margin to 14.34 percent.
Operating income for the quarter was $3,320 million, compared with $2,981 million in the previous year period.
"We experienced balanced sales growth in the quarter driven by an increase in both ticket and transactions, and our continued focus on productivity drove double-digit earnings-per-share growth," said Craig Menear, chairman, chief executive officer and president. "I would like to thank our associates and suppliers for their hard work and dedication to our customers throughout the quarter, and particularly in the face of Hurricane Matthew and the flooding in Louisiana."
For fiscal year 2016, Home Deport expects diluted earnings per share to be $6.33.
Operating cash flow improves
The Home Depot has generated cash of $7,919 million from operating activities during the nine month period, up 7.51 percent or $553 million, when compared with the last year period. The company has spent $1,115 million cash to meet investing activities during the nine month period as against cash outgo of $2,577 million in the last year period. It has incurred net capital expenditure of $1,115 million on net basis during the nine month period, up 5.29 percent or $56 million from year ago period.
The company has spent $5,424 million cash to carry out financing activities during the nine month period as against cash outgo of $3,423 million in the last year period.
Cash and cash equivalents stood at $3,589 million as on Oct. 30, 2016, up 18.06 percent or $549 million from $3,040 million on Nov. 01, 2015.
Debt moves up
The Home Depot has witnessed an increase in total debt over the last one year. It stood at $22,881 million as on Oct. 30, 2016, up 10.22 percent or $2,121 million from $20,760 million on Nov. 01, 2015. Total debt was 51.42 percent of total assets as on Oct. 30, 2016, compared with 47.02 percent on Nov. 01, 2015. Debt to equity ratio was at 4.07 as on Oct. 30, 2016, up from 2.72 as on Nov. 01, 2015. Interest coverage ratio improved to 13.50 for the quarter from 12.07 for the same period last year.
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