World’s leading home improvement chain, Home Depot Inc (NYSE:HD) has reported higher quarterly profit than estimated for the third quarter ending Nov 2. The improved margins were attributed to increase in spending by Americans on home renovations in the wake of improving job market. Craig Menear, Chief Executive Officer of Home Depot, said that during the quarter they witnessed robust performance across all geographies led by growth in transactions and continued strength in the core of the store.

 

Home Depot’s (NYSE:HD) forecast for 2014 related to sales growth of approximately 4.8 percent and profits of $4.54 per share have been reconfirmed. This also includes almost $34 million cost associated with breach of data between April to September this year.  The home improvement retailer is of the view that it might encounter additional costs linked with breach inclusive of legal actions and as a consequence fourth quarter and future period’s results might not meet the expectation. In U.S. and Canada, Home Depot is up against at least 44 civil lawsuits associated with the breach. Shares of the company showed a slight decline in the pre market trading, dropping by 0.4 percent to $97.66.

 

On Sept 18, Home Depot (NYSE:HD) disclosed that details of almost 56 million debit and credit cards have been stolen by hackers in the massive cyber attack lasting more than a month. Further adding to the agony, the company accepted earlier this month that close to 53 million email addresses have also been stolen in the attack. Home Depot explained that hackers accessed its network in April using a third-party vendor’s username and password and stole information through malware installed on self-checkout systems in the U.S. and Canada.

This breach has overtaken pre-Christmas data theft of Target Corp (NYSE:TGT) in which 40 million debit and credit cards were hacked thus badly impacting Target’s sales and profits. So the banks, retailers and card companies are rushing to incorporate microchips in U.S. credit and debit cards for enhanced security. Home Depot has also pledged to activate chip enabled check out terminal at all stores in U.S. by end December.

 

National Association of Home Builders reported that during the period of August to October, the response of homebuilders in U.S. was amazing because the strength in job market lead to increase in demand.  Resultantly, the third quarter results depicted increase in net income of Home Depot (NYSE:HD) to $1.54 billion or $1.15 per share which was $1.35 billion or $0.95 per share last year.  Research firm Consensus Metrix estimated 5 percent increase in sales for the retailer, however, sales increased by 5.2 percent. More than 85 percent of Home Depot stores are located in U.S. where sales showed an increase of 5.8 percent.

 

Home Depot (NYSE:HD) registered an increase of 5.4 percent in net sales to $20.52 billion. As per Thomson Reuters I/B/E/S, earnings per share of $1.13 and revenue of $20.47 billion were expected. The shares of the company had increased by 6.5 percent when markets closed on Monday.

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