UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
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Delaware | 95-3261426 | |
(State or other jurisdiction of
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(I.R.S. Employer Identification Number) | |
incorporation or organization) | ||
2455 Paces Ferry Road N.W., Atlanta, Georgia
| 30339
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(Registrant’s telephone number, including area code)
Large accelerated filerx | Accelerated filero | Non-accelerated filero | Smaller | |||
(Do not check if a smaller reporting company) |
2
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| Three Months Ended |
| Nine Months Ended |
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|
| November 2, |
| October 28, |
| November 2, |
| October 28, |
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NET SALES |
| $ | 17,784 |
| $ | 18,961 |
| $ | 56,681 |
| $ | 59,690 |
|
Cost of Sales |
| 11,790 |
| 12,622 |
| 37,651 |
| 39,747 |
| ||||
GROSS PROFIT |
| 5,994 |
| 6,339 |
| 19,030 |
| 19,943 |
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Operating Expenses: |
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|
|
|
|
|
|
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Selling, General and Administrative |
| 4,225 |
| 4,144 |
| 13,595 |
| 12,700 |
| ||||
Depreciation and Amortization |
| 446 |
| 431 |
| 1,342 |
| 1,250 |
| ||||
Total Operating Expenses |
| 4,671 |
| 4,575 |
| 14,937 |
| 13,950 |
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OPERATING INCOME |
| 1,323 |
| 1,764 |
| 4,093 |
| 5,993 |
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Interest (Income) Expense: |
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|
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Interest and Investment Income |
| (6 | ) | (29 | ) | (13 | ) | (67 | ) | ||||
Interest Expense |
| 157 |
| 154 |
| 485 |
| 497 |
| ||||
Interest, net |
| 151 |
| 125 |
| 472 |
| 430 |
| ||||
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EARNINGS FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES |
| 1,172 |
| 1,639 |
| 3,621 |
| 5,563 |
| ||||
Provision for Income Taxes |
| 416 |
| 568 |
| 1,307 |
| 2,024 |
| ||||
EARNINGS FROM CONTINUING OPERATIONS |
| 756 |
| 1,071 |
| 2,314 |
| 3,539 |
| ||||
EARNINGS FROM DISCONTINUED OPERATIONS, NET OF TAX |
| — |
| 20 |
| — |
| 185 |
| ||||
NET EARNINGS |
| $ | 756 |
| $ | 1,091 |
| $ | 2,314 |
| $ | 3,724 |
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|
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|
|
|
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Weighted Average Common Shares |
| 1,681 |
| 1,810 |
| 1,681 |
| 1,910 |
| ||||
BASIC EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
| $ | 0.45 |
| $ | 0.59 |
| $ | 1.38 |
| $ | 1.85 |
|
BASIC EARNINGS PER SHARE FROM DISCONTINUED OPERATIONS |
| $ | — |
| $ | 0.01 |
| $ | — |
| $ | 0.10 |
|
BASIC EARNINGS PER SHARE |
| $ | 0.45 |
| $ | 0.60 |
| $ | 1.38 |
| $ | 1.95 |
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Diluted Weighted Average Common Shares |
| 1,687 |
| 1,815 |
| 1,686 |
| 1,918 |
| ||||
DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
| $ | 0.45 |
| $ | 0.59 |
| $ | 1.37 |
| $ | 1.85 |
|
DILUTED EARNINGS PER SHARE FROM DISCONTINUED OPERATIONS |
| $ | — |
| $ | 0.01 |
| $ | — |
| $ | 0.10 |
|
DILUTED EARNINGS PER SHARE |
| $ | 0.45 |
| $ | 0.60 |
| $ | 1.37 |
| $ | 1.94 |
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Dividends Declared Per Share |
| $ | 0.225 |
| $ | 0.225 |
| $ | 0.675 |
| $ | 0.675 |
|
Note: The sum of Diluted Earnings per Share from Continuing Operations and Diluted Earnings Per Share from Discontinued Operations may not total Diluted Earnings Per Share due to rounding.
Three Months Ended | ||||||||
May 3, | May 4, | |||||||
2009 | 2008 | |||||||
Net Sales | $ | 16,175 | $ | 17,907 | ||||
Cost of Sales | 10,725 | 11,835 | ||||||
Gross Profit | 5,450 | 6,072 | ||||||
Operating Expenses: | ||||||||
Selling, General and Administrative | 4,042 | 4,900 | ||||||
Depreciation and Amortization | 428 | 444 | ||||||
Total Operating Expenses | 4,470 | 5,344 | ||||||
Operating Income | 980 | 728 | ||||||
Interest (Income) Expense: | ||||||||
Interest and Investment Income | (5 | ) | (3 | ) | ||||
Interest Expense | 180 | 167 | ||||||
Interest, net | 175 | 164 | ||||||
Earnings Before Provision for Income Taxes | 805 | 564 | ||||||
Provision for Income Taxes | 291 | 208 | ||||||
Net Earnings | $ | 514 | $ | 356 | ||||
Weighted Average Common Shares | 1,683 | 1,679 | ||||||
Basic Earnings Per Share | $ | 0.31 | $ | 0.21 | ||||
Diluted Weighted Average Common Shares | 1,689 | 1,683 | ||||||
Diluted Earnings Per Share | $ | 0.30 | $ | 0.21 | ||||
Dividends Declared Per Share | $ | 0.225 | $ | 0.225 |
3
(Amounts In Millions, Except Share and Per Share Data)
|
| November 2, |
| February 3, |
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ASSETS |
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Current Assets: |
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|
|
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Cash and Cash Equivalents |
| $ | 864 |
| $ | 445 |
|
Short-Term Investments |
| 10 |
| 12 |
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Receivables, net |
| 1,490 |
| 1,259 |
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Merchandise Inventories |
| 11,869 |
| 11,731 |
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Other Current Assets |
| 1,374 |
| 1,227 |
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Total Current Assets |
| 15,607 |
| 14,674 |
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Property and Equipment, at cost |
| 36,804 |
| 36,412 |
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Less Accumulated Depreciation and Amortization |
| 10,022 |
| 8,936 |
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Net Property and Equipment |
| 26,782 |
| 27,476 |
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Notes Receivable |
| 37 |
| 342 |
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Goodwill |
| 1,175 |
| 1,209 |
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Other Assets |
| 561 |
| 623 |
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Total Assets |
| $ | 44,162 |
| $ | 44,324 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current Liabilities: |
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Short-Term Debt |
| $ | — |
| $ | 1,747 |
|
Accounts Payable |
| 6,773 |
| 5,732 |
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Accrued Salaries and Related Expenses |
| 1,044 |
| 1,094 |
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Sales Taxes Payable |
| 431 |
| 445 |
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Deferred Revenue |
| 1,263 |
| 1,474 |
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Income Taxes Payable |
| 365 |
| 60 |
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Current Installments of Long-Term Debt |
| 1,016 |
| 300 |
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Other Accrued Expenses |
| 1,989 |
| 1,854 |
| ||
Total Current Liabilities |
| 12,881 |
| 12,706 |
| ||
Long-Term Debt, excluding current installments |
| 10,353 |
| 11,383 |
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Other Long-Term Liabilities |
| 1,978 |
| 1,833 |
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Deferred Income Taxes |
| 554 |
| 688 |
| ||
Total Liabilities |
| 25,766 |
| 26,610 |
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STOCKHOLDERS’ EQUITY |
|
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|
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Common Stock, par value $0.05; Authorized: 10 billion shares; Issued: 1.706 billion shares at November 2, 2008 and 1.698 billion shares at February 3, 2008; Outstanding: 1.695 billion shares at November 2, 2008 and 1.690 billion shares at February 3, 2008 |
| 85 |
| 85 |
| ||
Paid-In Capital |
| 5,988 |
| 5,800 |
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Retained Earnings |
| 12,518 |
| 11,388 |
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Accumulated Other Comprehensive Income |
| 177 |
| 755 |
| ||
Treasury Stock, at cost, 11 million shares at November 2, 2008 and 8 million shares at February 3, 2008 |
| (372 | ) | (314 | ) | ||
Total Stockholders’ Equity |
| 18,396 |
| 17,714 |
| ||
Total Liabilities and Stockholders’ Equity |
| $ | 44,162 |
| $ | 44,324 |
|
(Amounts In Millions, Except Share and Per Share Data) | May 3, | February 1, | ||||||
2009 | 2009 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and Cash Equivalents | $ | 2,214 | $ | 519 | ||||
Short-Term Investments | 6 | 6 | ||||||
Receivables, net | 1,283 | 972 | ||||||
Merchandise Inventories | 11,428 | 10,673 | ||||||
Other Current Assets | 1,383 | 1,192 | ||||||
Total Current Assets | 16,314 | 13,362 | ||||||
Property and Equipment, at cost | 36,458 | 36,477 | ||||||
Less Accumulated Depreciation and Amortization | 10,564 | 10,243 | ||||||
Net Property and Equipment | 25,894 | 26,234 | ||||||
Notes Receivable | 35 | 36 | ||||||
Goodwill | 1,134 | 1,134 | ||||||
Other Assets | 390 | 398 | ||||||
Total Assets | $ | 43,767 | $ | 41,164 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts Payable | $ | 6,901 | $ | 4,822 | ||||
Accrued Salaries and Related Expenses | 1,077 | 1,129 | ||||||
Sales Taxes Payable | 493 | 337 | ||||||
Deferred Revenue | 1,251 | 1,165 | ||||||
Income Taxes Payable | 359 | 289 | ||||||
Current Installments of Long-Term Debt | 1,768 | 1,767 | ||||||
Other Accrued Expenses | 1,699 | 1,644 | ||||||
Total Current Liabilities | 13,548 | 11,153 | ||||||
Long-Term Debt, excluding current installments | 9,667 | 9,667 | ||||||
Other Long-Term Liabilities | 2,242 | 2,198 | ||||||
Deferred Income Taxes | 316 | 369 | ||||||
Total Liabilities | 25,773 | 23,387 | ||||||
STOCKHOLDERS’ EQUITY | ||||||||
Common Stock, par value $0.05; Authorized: 10 billion shares; Issued: 1.714 billion shares at May 3, 2009 and 1.707 billion shares at February 1, 2009; Outstanding: 1.703 billion shares at May 3, 2009 and 1.696 billion shares at February 1, 2009 | 86 | 85 | ||||||
Paid-In Capital | 6,092 | 6,048 | ||||||
Retained Earnings | 12,226 | 12,093 | ||||||
Accumulated Other Comprehensive Loss | (38 | ) | (77 | ) | ||||
Treasury Stock, at cost, 11 million shares at May 3, 2009 and February 1, 2009 | (372 | ) | (372 | ) | ||||
Total Stockholders’ Equity | 17,994 | 17,777 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 43,767 | $ | 41,164 | ||||
4
|
| Nine Months Ended |
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|
| November 2, |
| October 28, |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net Earnings |
| $ | 2,314 |
| $ | 3,724 |
|
Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: |
|
|
|
|
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Depreciation and Amortization |
| 1,432 |
| 1,425 |
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Impairment related to Store Rationalization Charges |
| 313 |
| — |
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Stock-Based Compensation Expense |
| 155 |
| 180 |
| ||
Changes in Assets and Liabilities, net of the effects of acquisitions and disposition: |
|
|
|
|
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Increase in Receivables, net |
| (225 | ) | (186 | ) | ||
Increase in Merchandise Inventories |
| (365 | ) | (1,313 | ) | ||
Increase in Other Current Assets |
| (72 | ) | (211 | ) | ||
Increase in Accounts Payable and Accrued Expenses |
| 1,102 |
| 1,105 |
| ||
Decrease in Deferred Revenue |
| (192 | ) | (19 | ) | ||
Increase in Income Taxes Payable |
| 298 |
| 471 |
| ||
Decrease in Deferred Income Taxes |
| (164 | ) | (297 | ) | ||
Other |
| 198 |
| 283 |
| ||
Net Cash Provided by Operating Activities |
| 4,794 |
| 5,162 |
| ||
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|
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CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
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Capital Expenditures |
| (1,411 | ) | (2,518 | ) | ||
Payments for Businesses Acquired, net |
| — |
| (13 | ) | ||
Proceeds from Sale of Business, net |
| — |
| 8,337 |
| ||
Proceeds from Sales of Property and Equipment |
| 128 |
| 130 |
| ||
Purchases of Investments |
| (83 | ) | (11,217 | ) | ||
Proceeds from Sales and Maturities of Investments |
| 2 |
| 10,892 |
| ||
Net Cash (Used in) Provided by Investing Activities |
| (1,364 | ) | 5,611 |
| ||
|
|
|
|
|
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CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
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(Repayments of) Proceeds from Short-Term Borrowings, net |
| (1,740 | ) | 748 |
| ||
Repayments of Long-Term Debt |
| (308 | ) | (17 | ) | ||
Proceeds from Sale of Common Stock |
| 55 |
| 222 |
| ||
Repurchase of Common Stock |
| (70 | ) | (10,814 | ) | ||
Cash Dividends Paid to Stockholders |
| (1,141 | ) | (1,330 | ) | ||
Other |
| 209 |
| 374 |
| ||
Net Cash Used in Financing Activities |
| (2,995 | ) | (10,817 | ) | ||
|
|
|
|
|
| ||
Increase (Decrease) in Cash and Cash Equivalents |
| 435 |
| (44 | ) | ||
Effect of Exchange Rate Changes on Cash and Cash Equivalents |
| (16 | ) | (21 | ) | ||
Cash and Cash Equivalents at Beginning of Period |
| 445 |
| 600 |
| ||
Cash and Cash Equivalents at End of Period |
| $ | 864 |
| $ | 535 |
|
Three Months Ended | ||||||||
May 3, | May 4, | |||||||
2009 | 2008 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net Earnings | $ | 514 | $ | 356 | ||||
Reconciliation of Net Earnings to Net Cash Provided by Operating Activities: | ||||||||
Depreciation and Amortization | 453 | 474 | ||||||
Impairment Related to Rationalization Charges | - | 313 | ||||||
Stock-Based Compensation Expense | 54 | 52 | ||||||
Changes in Assets and Liabilities: | ||||||||
Increase in Receivables, net | (337 | ) | (322 | ) | ||||
Increase in Merchandise Inventories | (734 | ) | (926 | ) | ||||
Increase in Other Current Assets | (127 | ) | (96 | ) | ||||
Increase in Accounts Payable and Accrued Expenses | 1,798 | 1,965 | ||||||
Increase in Deferred Revenue | 82 | 108 | ||||||
Increase in Income Taxes Payable | 67 | 277 | ||||||
Decrease in Deferred Income Taxes | (94 | ) | (222 | ) | ||||
Other | 51 | 122 | ||||||
Net Cash Provided by Operating Activities | 1,727 | 2,101 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital Expenditures | (172 | ) | (449 | ) | ||||
Proceeds from Sales of Property and Equipment | 70 | 10 | ||||||
Proceeds from Sales and Maturities of Investments | 19 | 1 | ||||||
Net Cash Used in Investing Activities | (83 | ) | (438 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Repayments of Short-Term Borrowings, net | - | (1,249 | ) | |||||
Repayments of Long-Term Debt | (4 | ) | (9 | ) | ||||
Proceeds from Sale of Common Stock | 2 | 15 | ||||||
Cash Dividends Paid to Stockholders | (381 | ) | (379 | ) | ||||
Other | 426 | 267 | ||||||
Net Cash Provided by (Used in) Financing Activities | 43 | (1,355 | ) | |||||
Increase in Cash and Cash Equivalents | 1,687 | 308 | ||||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 8 | 14 | ||||||
Cash and Cash Equivalents at Beginning of Period | 519 | 445 | ||||||
Cash and Cash Equivalents at End of Period | $ | 2,214 | $ | 767 | ||||
5
|
| Three Months Ended |
| Nine Months Ended |
| ||||||||
|
| November 2, |
| October 28, |
| November 2, |
| October 28, |
| ||||
Net Earnings |
| $ | 756 |
| $ | 1,091 |
| $ | 2,314 |
| $ | 3,724 |
|
Other Comprehensive (Loss) Income: |
|
|
|
|
|
|
|
|
| ||||
Foreign Currency Translation Adjustments |
| (554 | ) | 275 |
| (574 | ) | 557 |
| ||||
Cash Flow Hedges (1) |
| (8 | ) | 1 |
| (3 | ) | 1 |
| ||||
Unrealized Loss on Investments (1) |
| (1 | ) | — |
| (1 | ) | — |
| ||||
Total Other Comprehensive (Loss) Income |
| (563 | ) | 276 |
| (578 | ) | 558 |
| ||||
Comprehensive Income |
| $ | 193 |
| $ | 1,367 |
| $ | 1,736 |
| $ | 4,282 |
|
Three Months Ended | ||||||||
May 3, | May 4, | |||||||
2009 | 2008 | |||||||
Net Earnings | $ | 514 | $ | 356 | ||||
Other Comprehensive Income (Loss): | ||||||||
Foreign Currency Translation Adjustments | 41 | (41 | ) | |||||
Cash Flow Hedges(1) | (3 | ) | (3 | ) | ||||
Unrealized Gain on Investments(1) | 1 | - | ||||||
Total Other Comprehensive Income (Loss): | 39 | (44 | ) | |||||
Comprehensive Income | $ | 553 | $ | 312 | ||||
(1) These components of comprehensive income are reported net of income taxes.
(1) | These components of comprehensive income are reported net of income taxes. |
6
The Company completed its annual assessment on the recoverability of Goodwill and indefinite lived intangible assets in the third quarter of fiscal 2008 and recorded no impairment charges.
2. CHANGE IN ACCOUNTING PRINCIPLE
During the first nine months of fiscal 2008, the Company implemented a new enterprise resource planning (“ERP”) system, including a new inventory system, for its retail operations in Canada. Along with this implementation, the Company changed its method of accounting for Merchandise Inventories for its retail operations in Canada from the lower of cost (first-in, first-out) or market, as determined by the retail inventory method, to the lower of cost or market using a weighted-average cost method. As of the end of the third quarter of fiscal 2008, the implementation of the new inventory system and related conversion to the weighted-average cost method for Canadian retail operations was substantially complete.
The new ERP system allows the Company to utilize the weighted-average cost method which the Company believes will result in greater precision in the costing of inventories and a better matching of cost of sales with revenue generated. The effect of the change on the Merchandise Inventories and Retained Earnings balances at the end of the third quarter of fiscal 2008 was not material. Prior to the inventory system conversion, the Company could not determine the impact of the change to the weighted-average cost method and therefore, could not retroactively apply the change to periods prior to fiscal 2008.
7
THE HOME DEPOT, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
3. STORE RATIONALIZATION CHARGES
7
|
| Total Expected |
| Fiscal |
| Total |
| |||
Asset impairments |
| $ | 313 |
| $ | 313 |
| $ | — |
|
Lease obligation costs, net |
| 226 |
| 226 |
| — |
| |||
Inventory markdowns |
| 10 |
| 10 |
| — |
| |||
Severance |
| 5 |
| 5 |
| — |
| |||
Other |
| 32 |
| 10 |
| 22 |
| |||
Total |
| $ | 586 |
| $ | 564 |
| $ | 22 |
|
Fiscal | First Quarter | Estimated | ||||||||||||||
Total Expected | 2008 | Fiscal 2009 | Remaining | |||||||||||||
Charges | Charges | Charges | Charges | |||||||||||||
Asset impairments | $ | 580 | $ | 580 | $ | - | $ | - | ||||||||
Lease obligation costs, net | 339 | 252 | 79 | 8 | ||||||||||||
Severance | 80 | 78 | 2 | - | ||||||||||||
Other | 103 | 41 | 36 | 26 | ||||||||||||
Total | $ | 1,102 | $ | 951 | $ | 117 | $ | 34 | ||||||||
Activity related
|
| Fiscal |
| Cash Payments |
| Non-cash |
| Balance, |
| ||||
Asset impairments |
| $ | 313 |
| $ | — |
| $ | 276 |
| $ | 37 |
|
Lease obligation costs, net |
| 226 |
| 38 |
| — |
| 188 |
| ||||
Inventory markdowns |
| 10 |
| 10 |
| — |
| — |
| ||||
Severance |
| 5 |
| 5 |
| — |
| — |
| ||||
Other |
| 10 |
| 8 |
| 2 |
| — |
| ||||
Total |
| $ | 564 |
| $ | 61 |
| $ | 278 |
| $ | 225 |
|
8
THE HOME DEPOT, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
4. DISCONTINUED OPERATIONS
On August 30, 2007, the Company closed the sale of HD Supply. The Company received $8.3 billion of net proceeds for the sale of HD Supply and recognized a $4 million loss, net of tax, on the sale of the business, subject to the finalization of working capital adjustments.
In connection with the sale, the Company purchased a 12.5% equity interest in the newly formed HD Supply for $325 million, which is included at cost in Other Assets in the accompanying Consolidated Balance Sheets. At the end of the third quarter of fiscal 2008, there were indications based on market conditions that the carrying value of this investment was greater thandetermine the fair value at that date. The Company believes any decline in fair valuemarket values used to be temporary in nature,record asset impairment and therefore has not recorded an impairment. The Company will continue to monitor the status of this investment.
Also in connection with the sale, the Company guaranteed a $1.0 billion senior secured loan (“guaranteed loan”) of HD Supply. The fair value of the guarantee, which was determined to be approximately $16 million, is recordedlease obligation costs include significant unobservable inputs, or Level 3 data, as a liability of the Company and included in Other Long-Term Liabilities. The guaranteed loan has a term of five years and the Company would be responsible for up to $1.0 billion and any unpaid interest in the event of non-paymentdefined by HD Supply. The guaranteed loan is collateralized by certain assets of HD Supply.
In accordance with StatementStatements of Financial Accounting Standards No. 144, “Accounting157, “Fair Value Measurements.”
The following table presents Net Sales and Earnings of HD Supply which have been reclassified to discontinued operations in the Consolidated Statements of Earnings for the three and nine months ended November 2, 2008 and October 28, 2007follows (amounts in millions):
|
| Three Months Ended |
| Nine Months Ended |
| ||||||||
|
| November 2, |
| October 28, |
| November 2, |
| October 28, |
| ||||
Net Sales |
| $ | — |
| $ | 1,156 |
| $ | — |
| $ | 7,391 |
|
Earnings (Loss) Before Provision for Income Taxes |
| $ | — |
| $ | (63 | ) | $ | — |
| $ | 291 |
|
Benefit (Provision) for Income Taxes |
| — |
| 87 |
| — |
| (102 | ) | ||||
Loss on Discontinued Operations, net |
| — |
| (4 | ) | — |
| (4 | ) | ||||
Earnings from Discontinued Operations, net of tax |
| $ | — |
| $ | 20 |
| $ | — |
| $ | 185 |
|
Accrued | Accrued | |||||||||||||||||||
Balance, | First Quarter | Balance, | ||||||||||||||||||
February 1, | Fiscal 2009 | Cash | Non-cash | May 3, | ||||||||||||||||
2009 | Charges | Uses | Uses | 2009 | ||||||||||||||||
Asset impairments | $ | 38 | $ | - | $ | - | $ | 11 | $ | 27 | ||||||||||
Lease obligation costs, net | 213 | 79 | 6 | - | 286 | |||||||||||||||
Severance | 72 | 2 | 44 | - | 30 | |||||||||||||||
Other | 20 | 36 | 55 | 1 | - | |||||||||||||||
Total | $ | 343 | $ | 117 | $ | 105 | $ | 12 | $ | 343 | ||||||||||
|
| Three Months Ended |
| Nine Months Ended |
| ||||
|
| November 2, |
| October 28, |
| November 2, |
| October 28, |
|
Weighted average common shares |
| 1,681 |
| 1,810 |
| 1,681 |
| 1,910 |
|
Effect of potentially dilutive securities: |
|
|
|
|
|
|
|
|
|
Stock Plans |
| 6 |
| 5 |
| 5 |
| 8 |
|
Diluted weighted average common shares |
| 1,687 |
| 1,815 |
| 1,686 |
| 1,918 |
|
Three Months Ended | ||||||||
May 3, | May 4, | |||||||
2009 | 2008 | |||||||
Weighted average common shares | 1,683 | 1,679 | ||||||
Effect of potentially dilutive securities: | ||||||||
Stock plans | 6 | 4 | ||||||
Diluted weighted average common shares | 1,689 | 1,683 | ||||||
8
9
The Home Depot, Inc.:
9
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10
We note You should read such information for investors as permitted by the Private Securities Litigation Reform Actin conjunction with our Financial Statements and related notes in Item 1 and “Management’s Discussion and Analysis of 1995.Financial Condition and Results of Operations” in Item 2 of this report. There also may be other factors that we cannot anticipate or that are not described in this report, generally because we do not currently perceive them to be material. Such factors could cause results to differ materially from our expectations.
As a resultof 4.1% for the first quarter of fiscal 2008.
first quarter of fiscal 2008.
11
improvement markets negatively affectedimpacted our Net Sales for the thirdfirst quarter and first nine months of fiscal 2008.2009. Our comparable store sales declined 8.3%10.2% in the thirdfirst quarter of fiscal 20082009 driven primarily by a 5.5%2.6% decline in comparable store customer transactions, as well as a 2.8%an 8.2% decline in our average ticket to $55.86. Due to$52.67. Comparable store sales for our U.S. stores declined 8.6% in the 53rd week in fiscal 2007, the thirdfirst quarter of fiscal 2008 was negatively impacted by a seasonal timing change that reduced Net Sales by approximately $225 million and comparable store sales by approximately 120 basis points.2009.
10
We remain committed
Associate Engagement – benefit of this in improved customer service ratings.
Product Excitement – We continue to work on our merchandising transformation by redefining how we run our business, implementing a portfolio strategy on products and creating new tools to support better merchandising decision making. As a result, we saw unit share gains against the market in several key merchandising classes. For example, insulation, carpet, ceramic tile, power tools, toilets, faucets, grills and molding all gained share in the thirdfirst quarter of fiscal 2008. ManyAdditionally, our average inventory per store decreased by 8.8% at the end of these classes received concentrated merchandising focus and investment, utilizing our portfolio strategy. For example, in molding, we updated the assortments regionally, refinedfirst quarter of fiscal 2009 compared to the merchandising sets, improved the value proposition and added pointfirst quarter of sale information making it easier for the customer to shop and make a selection. Energy efficient products also performed well this quarter. We will continue to focus on energy efficient products as we enter the holiday season, including an expanded assortment of LED lighting. Our gift centers have strong values on hand tools sets and power tools across a variety of price points, and we are ready to service the storage and organization needs of our customers following the holidays.
Shopping Environment – We continued our store reinvestment program by completing an aggressive list of maintenance projects, including the completion of our lighting upgrade, as well as more complex repair and maintenance activities for hundreds of other stores. In addition to programmatic maintenance, our integrated field and support center teams have rolled out store standards to all stores. We developed and piloted common guidelines on store appearance and shopability, including standards for front apron merchandising, wingstack usage, signage presentation, fixturing and off-shelf product. This initiative helps reduce the amount of time our store managers spend on these issues, removes unnecessary clutter from the aisles and implements a basic consistent approach in terms of appearance.
Product Availability –last year. We continued our supply chain transformation to improve product availability. We have improved our in-stock position, our inventory management systems and processes, and are rolling out new logistics processes and systems. We opened our fourthsixth Rapid Deployment Center (“RDC”) in the thirdfirst quarter of fiscal 2008,2009, and our RDCs now serve approximately 400600 of our stores. We plan to open one additional RDCRDCs in fiscal 2009 and expect that they will serve approximately 1,000 of our stores by the fourth quarterend of fiscal 2008 and2009. We remain committed to our overall roll-out strategy for RDCs, supporting our goal of increasing our central distribution penetration.
Own the Pro – We have made significant improvements in the services we provide our pro customers, particularly through our pro bid room. The pro bid room, which is available in all of our stores, allows us to leverage the buying power of The Home Depot for the benefit of our pro customers. Our direct ship program allows us to have large orders delivered from our vendors to the customer’s job site directly, reducing handling, lead-time and costs while building loyalty with the pro customer.
2008.
expenditures.
12
rationalization charge.the Rationalization Charges. Excluding the store rationalization charge,Rationalization Charges, our return on invested capital was 11.1% for continuing operations was 12.7%.the first quarter of fiscal 2009 compared to 13.0% for the first quarter of fiscal 2008.
11
|
| % of Net Sales |
| % Increase (Decrease) |
| ||||||||||||
|
| Three Months Ended |
| Nine Months Ended |
| in Dollar Amounts |
| ||||||||||
|
| November 2, |
| October 28, |
| November 2, |
| October 28, |
| Three |
| Nine |
| ||||
NET SALES |
| 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | (6.2 | )% | (5.0 | )% | ||||
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| ||||
GROSS PROFIT |
| 33.7 |
| 33.4 |
| 33.6 |
| 33.4 |
| (5.4 | ) | (4.6 | ) | ||||
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Operating Expenses: |
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|
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| ||||
Selling, General and Administrative |
| 23.8 |
| 21.9 |
| 24.0 |
| 21.3 |
| 2.0 |
| 7.0 |
| ||||
Depreciation and Amortization |
| 2.5 |
| 2.3 |
| 2.4 |
| 2.1 |
| 3.5 |
| 7.4 |
| ||||
Total Operating Expenses |
| 26.3 |
| 24.1 |
| 26.4 |
| 23.4 |
| 2.1 |
| 7.1 |
| ||||
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| ||||
OPERATING INCOME |
| 7.4 |
| 9.3 |
| 7.2 |
| 10.0 |
| (25.0 | ) | (31.7 | ) | ||||
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Interest (Income) Expense: |
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| ||||
Interest and Investment Income |
| — |
| (0.2 | ) | — |
| (0.1 | ) | (79.3 | ) | (80.6 | ) | ||||
Interest Expense |
| 0.9 |
| 0.8 |
| 0.9 |
| 0.8 |
| 1.9 |
| (2.4 | ) | ||||
Interest, net |
| 0.8 |
| 0.7 |
| 0.8 |
| 0.7 |
| 20.8 |
| 9.8 |
| ||||
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| ||||
EARNINGS FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES |
| 6.6 |
| 8.6 |
| 6.4 |
| 9.3 |
| (28.5 | ) | (34.9 | ) | ||||
Provision for Income Taxes |
| 2.3 |
| 3.0 |
| 2.3 |
| 3.4 |
| (26.8 | ) | (35.4 | ) | ||||
EARNINGS FROM CONTINUING OPERATIONS |
| 4.3 | % | 5.7 | % | 4.1 | % | 5.9 | % | (29.4 | )% | (34.6 | )% | ||||
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| ||||||||
Note: Certain percentages may not sum to totals due to rounding. |
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SELECTED SALES DATA |
|
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|
| ||||
Number of Customer Transactions (in millions) |
| 315 |
| 326 |
| 989 |
| 1,021 |
| (3.4 | )% | (3.1 | )% | ||||
Average Ticket |
| $ | 55.86 |
| $ | 57.48 |
| $ | 56.97 |
| $ | 58.26 |
| (2.8 | )% | (2.2 | )% |
Weighted Average Weekly Sales Per Operating Store (in thousands) |
| $ | 597 |
| $ | 651 |
| $ | 640 |
| $ | 696 |
| (8.3 | )% | (8.0 | )% |
Weighted Average Sales per Square Foot |
| $ | 295.95 |
| $ | 323.36 |
| $ | 317.26 |
| $ | 345.72 |
| (8.5 | )% | (8.2 | )% |
Comparable Store Sales Decrease (%)(1) |
| (8.3 | )% | (6.2 | )% | (7.5 | )% | (6.3 | )% | N/A |
| N/A |
|
% of Net Sales | |||||||||||||
% Increase | |||||||||||||
(Decrease) | |||||||||||||
in Dollar | |||||||||||||
Three Months Ended | Amounts | ||||||||||||
May 3, | May 4, | 2009 | |||||||||||
2009 | 2008 | vs. 2008 | |||||||||||
NET SALES | 100.0 | % | 100.0 | % | (9.7 | )% | |||||||
GROSS PROFIT | 33.7 | 33.9 | (10.2 | ) | |||||||||
Operating Expenses: | |||||||||||||
Selling, General and Administrative | 25.0 | 27.4 | (17.5 | ) | |||||||||
Depreciation and Amortization | 2.6 | 2.5 | (3.6 | ) | |||||||||
Total Operating Expenses | 27.6 | 29.8 | (16.4 | ) | |||||||||
OPERATING INCOME | 6.1 | 4.1 | 34.6 | ||||||||||
Interest (Income) Expense: | |||||||||||||
Interest and Investment Income | — | — | 66.7 | ||||||||||
Interest Expense | 1.1 | 0.9 | 7.8 | ||||||||||
Interest, net | 1.1 | 0.9 | 6.7 | ||||||||||
EARNINGS BEFORE PROVISION FOR INCOME TAXES | 5.0 | 3.2 | 42.7 | ||||||||||
Provision for Income Taxes | 1.8 | 1.2 | 39.9 | ||||||||||
NET EARNINGS | 3.2 | % | 2.0 | % | 44.4 | % | |||||||
Note: Certain percentages may not sum to totals due to rounding. | |||||||||||||
SELECTED SALES DATA | |||||||||||||
Number of Customer Transactions (in millions) | 310 | 314 | (1.3 | )% | |||||||||
Average Ticket | $ | 52.67 | $ | 57.36 | (8.2 | ) | |||||||
Weighted Average Weekly Sales Per Operating Store (in thousands) | $ | 552 | $ | 616 | (10.4 | ) | |||||||
Weighted Average Sales per Square Foot | $ | 273 | $ | 305 | (10.5 | )% | |||||||
Comparable Store Sales Decrease (%)(1) | (10.2 | )% | (6.5 | )% | N/A |
| ||
(1) | Includes Net Sales at locations open greater than 12 months, including relocated and remodeled stores. Retail stores become comparable on the Monday following their 365thday of operation. Comparable store sales is intended only as supplemental information and is not a substitute for Net Sales or Net Earnings presented in accordance with generally accepted accounting principles. |
12
13
2008. The decrease in Net Sales for the thirdfirst quarter and first nine months of fiscal 20082009 reflects the impact of negative comparable store sales, partially offset by Net Sales of $220 million from new stores instores. Total comparable store sales decreased 10.2% for the first nine months of fiscal 2008 of $1.5 billion, including $439 million in the third quarter of fiscal 2008. Comparable store sales decreased 8.3% for the third quarter of fiscal 20082009 compared to a decrease of 6.2%6.5% for the thirdfirst quarter of fiscal 2007. For the first nine months of fiscal 2008, comparable store sales decreased 7.5% compared to a decrease of 6.3% for the same period of fiscal 2007.2008. Due to the 53rd week in fiscal 2007, the thirdfirst quarter of fiscal 2008 was negatively impacted bybenefited from a seasonal timing change that reduced Net Sales by approximately $225 million and comparable store sales by approximately 120 basis points. For the first nine months of fiscal 2008, this seasonal timing change added approximately $151$536 million to Net Sales and approximately 30270 basis points to our comparable store sales.
sales in the first quarter of fiscal 2008.
Our international businesses began to feel some of the economic pressure that we have experienced in the U.S. in the third quarter of fiscal 2008. Our comparable store sales for Canada and China were at the Company average for the third quarter of fiscal 2008. For the first nine months of fiscal 2008, comparable store sales for Canada were above the Company average and were positive for China. Our stores in Mexico posted double digit comparable store sales in both the third quarter and first nine months of fiscal 2008.
In order to meet our customer service objectives, we strategically open stores near market areas served by existing stores (“cannibalize”) to enhance service levels, gain incremental sales and increase market penetration. Our new stores cannibalized approximately 7% of our existing stores as of the third quarter of fiscal 2008, which had a negative impact to comparable store sales of approximately 1%.
2009.
non-U.S. businesses, principally Canada.
14
of the private label credit card sales was 28% for both periods, as compared to 30% and 29% for the third quarter and first nine months of fiscal 2007, respectively.
Depreciation and Amortization increased 3.5%decreased 3.6% to $446$428 million for the thirdfirst quarter of fiscal 20082009 from $431$444 million for the thirdfirst quarter of fiscal 2007. Depreciation and Amortization was $1.3 billion for the third quarter of both fiscal 2008 and fiscal 2007.2008. Depreciation and Amortization as a percent of Net Sales was 2.6% for the first quarter of fiscal 2009 and 2.5% for the thirdfirst quarter of fiscal 2008 compared to 2.3% for2008. Excluding the third quarter of fiscal 2007,Rationalization Charges, Depreciation and was 2.4% for the first nine months of fiscal 2008 compared to 2.1% for the same period in fiscal 2007. The increaseAmortization as a percentagepercent of Net Sales in both periods wasincreased by 18 basis points from last year, primarily due to sales deleverage and the depreciation of our investments in shorter lived assets like store resets and technology.
deleverage.
In the third quarter of fiscal 2008,2009 compared to 7.1% for the first quarter of fiscal 2008.
due to sales deleverage.
13
On August 30, 2007, the Company closed the sale of HD Supply. Discontinued operations for the third quarter and first nine months of fiscal 2007 consist of the results of operations of HD Supply. Net Sales from discontinued operations were $1.2 billion and Earnings from Discontinued Operations, net of tax, were $20 million for the third quarter of fiscal 2007. Net Sales from discontinued operations were $7.4 billion and Earnings from Discontinued Operations, net of tax, were $185 million for the first nine months of fiscal 2007.
Three Months Ended May 3, 2009 | ||||||||||||||||
amounts in millions, except per share data | As | Non-GAAP | % of | |||||||||||||
Reported | Adjustments | Measurements | Net Sales | |||||||||||||
Net Sales | $ | 16,175 | $ | 221 | $ | 15,954 | 100.0 | % | ||||||||
Cost of Sales | 10,725 | 192 | 10,533 | 66.0 | ||||||||||||
Gross Profit | 5,450 | 29 | 5,421 | 34.0 | ||||||||||||
Operating Expenses: | ||||||||||||||||
Selling, General and Administrative | 4,042 | 143 | 3,899 | 24.4 | ||||||||||||
Depreciation and Amortization | 428 | 3 | 425 | 2.7 | ||||||||||||
Total Operating Expenses | 4,470 | 146 | 4,324 | 27.1 | ||||||||||||
Operating Income | 980 | (117 | ) | 1,097 | 6.9 | |||||||||||
Interest, net | 175 | - | 175 | 1.1 | ||||||||||||
Earnings Before Provision for Income Taxes | 805 | (117 | ) | 922 | 5.8 | |||||||||||
Provision for Income Taxes | 291 | (44 | ) | 335 | 2.1 | |||||||||||
Net Earnings | $ | 514 | $ | (73 | ) | $ | 587 | 3.7 | % | |||||||
Diluted Earnings per Share | $ | 0.30 | $ | (0.04 | ) | $ | 0.35 | N/A | ||||||||
Three Months Ended May 4, 2008 | ||||||||||||||||
As | Non-GAAP | % of | ||||||||||||||
Reported | Adjustments | Measurements | Net Sales | |||||||||||||
Net Sales | $ | 17,907 | $ | - | $ | 17,907 | 100.0 | % | ||||||||
Cost of Sales | 11,835 | 10 | 11,825 | 66.0 | ||||||||||||
Gross Profit | 6,072 | (10 | ) | 6,082 | 34.0 | |||||||||||
Operating Expenses: | ||||||||||||||||
Selling, General and Administrative | 4,900 | 533 | 4,367 | 24.4 | ||||||||||||
Depreciation and Amortization | 444 | - | 444 | 2.5 | ||||||||||||
Total Operating Expenses | 5,344 | 533 | 4,811 | 26.9 | ||||||||||||
Operating Income | 728 | (543 | ) | 1,271 | 7.1 | |||||||||||
Interest, net | 164 | - | 164 | 0.9 | ||||||||||||
Earnings Before Provision for Income Taxes | 564 | (543 | ) | 1,107 | 6.2 | |||||||||||
Provision for Income Taxes | 208 | (202 | ) | 410 | 2.3 | |||||||||||
Net Earnings | $ | 356 | $ | (341 | ) | $ | 697 | 3.9 | % | |||||||
Diluted Earnings per Share | $ | 0.21 | $ | (0.20 | ) | $ | 0.41 | N/A | ||||||||
14
15
(Amounts In Millions, Except Per Share Data)
|
| As Reported |
| Store |
| Non-GAAP |
| |||
Net Sales |
| $ | 56,681 |
| $ | — |
| $ | 56,681 |
|
Cost of Sales |
| 37,651 |
| 10 |
| 37,641 |
| |||
Gross Profit |
| 19,030 |
| (10 | ) | 19,040 |
| |||
Operating Expenses: |
|
|
|
|
|
|
| |||
Selling, General and Administrative |
| 13,595 |
| 552 |
| 13,043 |
| |||
Depreciation and Amortization |
| 1,342 |
| 2 |
| 1,340 |
| |||
Total Operating Expenses |
| 14,937 |
| 554 |
| 14,383 |
| |||
Operating Income |
| 4,093 |
| (564 | ) | 4,657 |
| |||
Interest, net |
| 472 |
| — |
| 472 |
| |||
Earnings From Continuing Operations Before Provision for Income Taxes |
| 3,621 |
| (564 | ) | 4,185 |
| |||
Provision for Income Taxes |
| 1,307 |
| (209 | ) | 1,516 |
| |||
Earnings from Continuing Operations |
| $ | 2,314 |
| $ | (355 | ) | $ | 2,669 |
|
|
|
|
|
|
|
|
| |||
Diluted Earnings per Share from Continuing Operations |
| $ | 1.37 |
| $ | (0.21 | ) | $ | 1.58 |
|
changes in net working capital.
Duringlast year.
2008.
15
During the third quarter of fiscal 2008, we settled our fair value hedge interest rate swaps with notional amounts of $2.4 billion that previously swapped fixed rate interest on our $3.0 billion 5.40% Senior Notes for variable rate interest. We received $43 million for the settlements which will be amortized to reduce net Interest Expense over the remaining term of the debt.
16
RECENT ACCOUNTING PRONOUNCEMENTS
In June 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position (“FSP”) Emerging Issues Task Force No. 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities” (“FSP-EITF 03-6-1”). FSP-EITF 03-6-1 clarifies that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are to be included in the computation of earnings per share under the two-class method. FSP-EITF 03-6-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those years. The Company is in the process of evaluating the impact of the adoption of FSP-EITF 03-6-1, but it is not expected to have a material impact on our consolidated financial statements.
The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were effective.
16
17
Reference is made to pages 12 and 13 of the Company’s Annual Report on Form 10-K for the fiscal year ended February 3, 2008 which describes six purported class actions filed against the Company and certain of its current and former officers and directors alleging claims pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder in connection with the Company’s return-to-vendor practices. As previously reported, on July 18, 2007, the trial court granted the defendants’ motions to dismiss without allowing the plaintiffs leave to amend and entered a judgment in favor of the defendants. Thereafter, the plaintiffs appealed. On October 8, 2008, the U.S. Court of Appeals for the Eleventh Circuit issued an order affirming the trial court’s decision.
In compliance with SEC disclosure requirements, the environmental proceeding set forth below involves potential monetary sanctions of $100,000 or more. Although the Company cannot predict the outcome of this proceeding, it does not expect any such outcome to have a material adverse effect on its consolidated financial condition or results of operations.
17
18
(a) | During the first quarter of fiscal 2009, the Company issued 381 deferred stock units under The Home Depot, Inc. NonEmployee Directors’ Deferred Stock Compensation Plan pursuant to the exemption from registration provided by Section 4(2) of the Securities Act of 1933, as amended. The deferred stock units were credited to the accounts of such nonemployee directors who elected to receive board retainers in the form of deferred stock units instead of cash during the first quarter of fiscal 2009. The deferred stock units convert to shares of common stock on a one-for-one basis following a termination of service as described in this plan. | ||
During the first quarter of fiscal 2009, the Company credited 1,411 deferred stock units to participant accounts under The Home Depot FutureBuilder Restoration Plan pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended, for involuntary, non-contributory plans. The deferred stock units convert to shares of common stock on a one-for-one basis following the termination of services as described in this plan. | |||
(c) | Since fiscal 2002, the Company has repurchased shares of its common stock having a value of approximately $27.3 billion pursuant to its share repurchase program. The number and average price of shares purchased in each fiscal month of the first quarter of fiscal 2009 are set forth in the table below: |
Approximate Dollar | ||||||||||||||||
Total | Total Number of | Value of Shares | ||||||||||||||
Number of | Average | Shares Purchased as | that May Yet Be | |||||||||||||
Shares | Price Paid | Part of Publicly | Purchased Under | |||||||||||||
Period | Purchased(1) | Per Share(1) | Announced Program(2) | the Program(2) | ||||||||||||
February 2, 2009 - March 1, 2009 | 3,175 | $ | 20.77 | - | $ | 12,731,893,819 | ||||||||||
March 2, 2009 - March 29, 2009 | 100,863 | $ | 21.84 | - | $ | 12,731,893,819 | ||||||||||
March 30, 2009 - May 3, 2009 | 1,476 | $ | 25.73 | - | $ | 12,731,893,819 |
(1) | These amounts are repurchases pursuant to the Company’s 1997 and 2005 Omnibus Stock Incentive Plans (the “Plans”). Under the Plans, participants may exercise stock options by surrendering shares of common stock that the participants already own as payment of the exercise price. Participants in the Plans may also surrender shares as payment of applicable tax withholding on the vesting of restricted stock and deferred share awards. Shares so surrendered by participants in the Plans are repurchased pursuant to the terms of the Plans and applicable award agreement and not pursuant to publicly announced share repurchase programs. | ||
(2) | The Company’s common stock repurchase program was initially announced on July 15, 2002. As of the beginning of the first quarter of fiscal 2009, the Board had approved purchases up to $40.0 billion. The program does not have a prescribed expiration date. Given current market conditions, we have suspended the repurchase program until our business and credit markets stabilize. |
18
F. Duane Ackerman | Albert P. Carey | |
For: 1,430,536,492 | For: 1,430,964,521 | |
Against: 20,255,823 | Against: 19,830,250 | |
Abstain: 5,359,370 | Abstain: 5,356,914 | |
David H. Batchelder | Armando Codina | |
For: 1,428,052,091 | For: 1,386,043,364 | |
Against: 22,665,040 | Against: 64,626,358 | |
Abstain: 5,434,554 | Abstain: 5,481,963 | |
Francis S. Blake | Bonnie G. Hill | |
For: 1,418,753,529 | For: 1,412,805,801 | |
Against: 32,770,706 | Against: 38,145,209 | |
Abstain: 4,627,450 | Abstain: 5,200,674 | |
Ari Bousbib | Karen L. Katen | |
For: 1,397,265,132 | For: 1,416,594,846 | |
Against: 53,291,408 | Against: 34,321,935 | |
Abstain: 5,595,145 | Abstain: 5,234,903 | |
Gregory D. Brenneman | ||
For: 1,390,131,025 | ||
Against: 60,628,618 | ||
Abstain: 5,392,041 |
19
20
During the third quarter of fiscal 2008, the Company credited 900 deferred stock units to participant accounts under The Home Depot FutureBuilder Restoration Plan pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended, for involuntary, non-contributory plans. The deferred stock units convert to shares of common stock on a one-for-one basis following a termination of service as described in this plan.
(c)Since fiscal 2002, the Company has repurchased shares of its common stock having a value of approximately $27.3 billion. The number and average price of shares purchased in each fiscal month of the third quarter of fiscal 2008 are set forth in the table below:
Period |
| Total |
| Average |
| Total Number of |
| Approximate Dollar |
| ||
August 4, 2008 – August 31, 2008 |
| 949,111 |
| $ | 27.50 |
| 851,500 |
| $ | 12,778,189,392 |
|
September 1, 2008 – September 28, 2008 |
| 1,674,969 |
| $ | 28.90 |
| 1,595,987 |
| $ | 12,731,893,819 |
|
September 29, 2008 – November 2, 2008 |
| 25,115 |
| $ | 18.58 |
| — |
| $ | 12,731,893,819 |
|
(1)These amounts include repurchases pursuant to the Company’s 1997 and 2005 Omnibus Stock Incentive Plans (the “Plans”). Under the Plans, participants may exercise stock options by surrendering shares of common stock that the participants already own as payment of the exercise price. Participants in the Plans may also surrender shares as payment of applicable tax withholding on the vesting of restricted stock and deferred share awards. Shares so surrendered by participants in the Plans are repurchased pursuant to the terms of the Plans and applicable award agreement and not pursuant to publicly announced share repurchase programs.
(2)The Company’s common stock repurchase program was initially announced on July 15, 2002. As of the beginning of the third quarter of fiscal 2008, the Board had approved purchases up to $40.0 billion. The program does not have a prescribed expiration date.
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| ||||
*3.1 | Amended and Restated Certificate of Incorporation of The Home Depot, Inc.[Form 10-Q for the fiscal quarter ended August 4, 2002, Exhibit 3.1] | |||
| 3.2 | Certificate of Amendment to Amended and Restated Certificate of Incorporation of The Home Depot, Inc. | ||
*3.3 | By-Laws of The Home Depot, Inc. | |||
| *10.1 | † | Form of U.S. Restricted Stock Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.1] | |
*10.2 | † | Form of Executive Officer Nonqualified Stock Option Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.4] | ||
*10.3 | † | Form of Non-Employee Director Nonqualified Stock Option Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.5] | ||
*10.4 | † | Form of Canada Deferred Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.2] | ||
*10.5 | † | Form of Mexico Deferred Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.3] | ||
*10.6 | † | Form of Performance Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.6] | ||
12.1 | Statement of Computation of Ratio of Earnings to Fixed Charges. | |||
| 15.1 | Letter of KPMG LLP, Acknowledgement of Independent Registered Public Accounting Firm, dated | ||
| 31.1 |
| ||
| Certification of the Chairman and Chief Executive Officer pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended. | |||
| 31.2 | Certification of the Chief Financial Officer and Executive Vice President – Corporate Services pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended. | ||
| 32.1 | Certification of Chairman and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
| 32.2 | Certification of Chief Financial Officer and Executive Vice President – Corporate Services pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
† | Management contract or compensatory plan or arrangement required to be filed as an exhibit to this form pursuant to Item 6 of this report. |
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SIGNATURES
THE HOME DEPOT, INC.(Registrant) | ||||||
| ||||||
By: | /s/ FRANCIS S. BLAKE | |||||
Francis S. Blake | ||||||
Chairman and Chief Executive Officer | ||||||
/s/ CAROL B. TOMÉ | ||||||
Carol B. Tomé | ||||||
Chief Financial Officer and | ||||||
Executive Vice President – Corporate Services |
| ||
|
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Exhibits marked with an asterisk (*) are incorporated by reference to exhibits or appendices previously filed with the SEC, as indicated by the references in brackets. All other exhibits are filed herewith.
| ||||
Exhibit | Description | |||
Exhibits marked with an asterisk (*) are incorporated by reference to exhibits or appendices previously filed with the Securities and Exchange Commission, as indicated by the references in brackets. All other exhibits are filed or furnished herewith. | ||||
*3.1 | Amended and Restated Certificate of Incorporation of The Home Depot, Inc.[Form 10-Q for the fiscal quarter ended August 4, 2002, Exhibit 3.1] | |||
| 3.2 | Certificate of Amendment to Amended and Restated Certificate of Incorporation of The Home Depot, Inc. | ||
*3.3 | By-Laws of The Home Depot, Inc. | |||
| *10.1 | † | Form of U.S. Restricted Stock Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.1] | |
*10.2 | † | Form of Executive Officer Nonqualified Stock Option Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.4] | ||
*10.3 | † | Form of Non-Employee Director Nonqualified Stock Option Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.5] | ||
*10.4 | † | Form of Canada Deferred Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.2] | ||
*10.5 | † | Form of Mexico Deferred Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.3] | ||
*10.6 | † | Form of Performance Share Award Pursuant to The Home Depot, Inc. 2005 Omnibus Stock Incentive Plan.[Form 8-K filed on March 13, 2009, Exhibit 10.6] | ||
12.1 | Statement of Computation of Ratio of Earnings to Fixed Charges. | |||
| 15.1 | Letter of KPMG LLP, Acknowledgement of Independent Registered Public Accounting Firm, dated | ||
| 31.1 |
| ||
| Certification of the Chairman and Chief Executive Officer pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended. | |||
| 31.2 | Certification of the Chief Financial Officer and Executive Vice President – Corporate Services pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended. | ||
| 32.1 | Certification of Chairman and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||
| 32.2 | Certification of Chief Financial Officer and Executive Vice President – Corporate Services pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
† | Management contract or compensatory plan or arrangement required to be filed as an exhibit to this form pursuant to Item 6 of this report. |
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