HD Supply 10-Q 8 Dec 15 2015 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Nov. 01, 2015	Dec. 04, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	HD Supply Holdings, Inc.
Entity Central Index Key	1,573,097
Document Type	10-Q
Document Period End Date	Nov. 1, 2015
Amendment Flag	false
Current Fiscal Year End Date	--01-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		200,136,455
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (HD Supply Holdings, Inc.) - USD ($) shares in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
Net Sales	$ 2,012	$ 1,914	$ 5,740	$ 5,427
Cost of sales	1,346	1,299	3,835	3,670
Gross Profit	666	615	1,905	1,757
Operating expenses:
Selling, general and administrative	405	390	1,211	1,152
Depreciation and amortization	28	46	84	152
Restructuring	4		4	6
Total operating expenses	437	436	1,299	1,310
Operating Income (Loss)	229	179	606	447
Interest expense	99	115	311	347
Loss on extinguishment & modification of debt	100		100	2
Other (income) expense, net		(4)	1	(3)
Income from Continuing Operations Before Provision for Income Taxes	30	68	194	101
Provision (benefit) for income taxes	15	28	(155)	41
Income from Continuing Operations	15	40	349	60
Income from discontinued operations, net of tax	235	20	252	36
Net Income (Loss)	250	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	18	(3)	16	(1)
Total Comprehensive Income (Loss)	$ 268	$ 57	$ 617	$ 95
Weighted average common shares outstanding (thousands)
Basic	197,529	194,288	196,589	193,806
Diluted	201,546	200,151	201,354	199,689
Basic Earnings Per Share:
Income from Continuing Operations (in dollars per share)	$ 0.08	$ 0.21	$ 1.78	$ 0.31
Income from Discontinued Operations (in dollars per share)	1.19	0.10	1.28	0.19
Net income	1.27	0.31	3.06	0.50
Diluted Earnings Per Share:
Income from Continuing Operations (in dollars per share)	0.07	0.20	1.73	0.30
Income from Discontinued Operations (in dollars per share)	1.17	0.10	1.25	0.18
Net income	$ 1.24	$ 0.30	$ 2.98	$ 0.48

CONSOLIDATED BALANCE SHEETS (HD

CONSOLIDATED BALANCE SHEETS (HD Supply Holdings, Inc.) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Current assets:
Cash and cash equivalents	$ 77	$ 85
Receivables, less allowance for doubtful accounts of $13 and $14	1,092	868
Inventories	868	784
Deferred tax asset	4	9
Current assets of discontinued operations		509
Other current assets	37	43
Total current assets	2,078	2,298
Property and equipment, net	327	340
Goodwill	2,869	2,869
Intangible assets, net	134	145
Non-current assets of discontinued operations		295
Other assets	78	113
Total assets	5,486	6,060
Current liabilities:
Accounts payable	651	510
Accrued compensation and benefits	129	144
Current installments of long-term debt	9	34
Current liabilities of discontinued operations		217
Other current liabilities	188	230
Total current liabilities	977	1,135
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	142	166
Other liabilities	108	296
Total liabilities	5,612	6,820
Stockholders' equity (deficit):
Common stock, par value $0.01; 1 billion shares authorized; 199.4 million and 196.0 million shares issued and outstanding at November 1, 2015 and February 1, 2015, respectively	2	2
Paid-in capital	3,887	3,818
Accumulated deficit	(4,002)	(4,540)
Accumulated other comprehensive loss	(12)	(28)
Treasury stock, at cost, 0.04 million and 0.4 million shares at November 1, 2015 and February 1, 2015, respectively	(1)	(12)
Total stockholders' equity (deficit)	(126)	(760)
Total liabilities and stockholders' equity (deficit)	$ 5,486	$ 6,060

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (HD Supply Holdings, Inc.) - USD ($) shares in Thousands, $ in Millions	Nov. 01, 2015	Feb. 01, 2015
CONSOLIDATED BALANCE SHEETS
Receivables, allowance for doubtful accounts (in dollars)	$ 13	$ 14
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000	1,000,000
Common stock, shares issued	199,400	196,000
Common stock, shares outstanding	199,400	196,000
Treasury stock, shares	40	400

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (HD Supply Holdings, Inc.) - USD ($) $ in Millions	9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 601	$ 96
Reconciliation of net income to net cash provided by (used in) operating activities:
Depreciation and amortization	106	187
Provision for uncollectibles	5	6
Non-cash interest expense	18	19
Payment of discounts upon extinguishment of debt	(12)	(1)
Loss on extinguishment & modification of debt	100	2
Gain on sale of business	(186)
Stock-based compensation expense	14	12
Deferred income taxes	(15)	43
Other	(2)
Changes in assets and liabilities:
(Increase) decrease in receivables	(248)	(264)
(Increase) decrease in inventories	(124)	(96)
(Increase) decrease in other current assets	4	26
Increase (decrease) in accounts payable and accrued liabilities	93	85
Increase (decrease) in other long-term liabilities	(181)	6
Net cash provided by (used in) operating activities	173	121
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(61)	(92)
Proceeds from sales of property and equipment	2	3
Proceeds from sale of business, net	810
Net cash provided by (used in) investing activities	751	(89)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock under employee benefit plans	55	40
Purchase of treasury shares	(51)	(40)
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver debt	784	524
Repayments on long-term revolver debt	(850)	(554)
Debt issuance and modification costs	(6)	(3)
Other financing activities	1
Net cash provided by (used in) financing activities	(930)	(40)
Effect of exchange rates on cash and cash equivalents	(2)
Increase (decrease) in cash and cash equivalents	(8)	(8)
Cash and cash equivalents at beginning of period	85	115
Cash and cash equivalents at end of period	$ 77	$ 107

CONSOLIDATED STATEMENTS OF OPE6

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (HD Supply, Inc.) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
Net Sales	$ 1,914	$ 5,740	$ 5,427
Cost of sales	1,299	3,835	3,670
Gross Profit	615	1,905	1,757
Operating expenses:
Selling, general and administrative	390	1,211	1,152
Depreciation and amortization	46	84	152
Restructuring		4	6
Total operating expenses	436	1,299	1,310
Operating Income (Loss)	179	606	447
Interest expense	115	311	347
Loss on extinguishment & modification of debt		100	2
Other (income) expense, net	(4)	1	(3)
Income from Continuing Operations Before Provision for Income Taxes	68	194	101
Provision (benefit) for income taxes	28	(155)	41
Income from Continuing Operations	40	349	60
Income from discontinued operations, net of tax	20	252	36
Net Income (Loss)	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	(3)	16	(1)
Total Comprehensive Income (Loss)	57	617	95
HD Supply, Inc
Net Sales	1,914	5,740	5,427
Cost of sales	1,299	3,835	3,670
Gross Profit	615	1,905	1,757
Operating expenses:
Selling, general and administrative	390	1,211	1,152
Depreciation and amortization	46	84	152
Restructuring		4	6
Total operating expenses	436	1,299	1,310
Operating Income (Loss)	179	606	447
Interest expense	115	311	347
Loss on extinguishment & modification of debt		100	2
Other (income) expense, net	(4)	1	(3)
Income from Continuing Operations Before Provision for Income Taxes	68	194	101
Provision (benefit) for income taxes	28	(155)	41
Income from Continuing Operations	40	349	60
Income from discontinued operations, net of tax	20	252	36
Net Income (Loss)	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	(3)	16	(1)
Total Comprehensive Income (Loss)	$ 57	$ 617	$ 95

CONSOLIDATED BALANCE SHEETS (H7

CONSOLIDATED BALANCE SHEETS (HD Supply, Inc.) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Current assets:
Cash and cash equivalents	$ 77	$ 85
Receivables, less allowance for doubtful accounts of $13 and $14	1,092	868
Inventories	868	784
Deferred tax asset	4	9
Current assets of discontinued operations		509
Other current assets	37	43
Total current assets	2,078	2,298
Property and equipment, net	327	340
Goodwill	2,869	2,869
Intangible assets, net	134	145
Non-current assets of discontinued operations		295
Other assets	78	113
Total assets	5,486	6,060
Current liabilities:
Accounts payable	651	510
Accrued compensation and benefits	129	144
Current installments of long-term debt	9	34
Current liabilities of discontinued operations		217
Other current liabilities	188	230
Total current liabilities	977	1,135
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	142	166
Other liabilities	108	296
Total liabilities	5,612	6,820
Stockholder's equity (deficit):
Common stock, par value $0.01; 1,000 shares authorized; 1,000 shares issued and outstanding	2	2
Paid-in capital	3,887	3,818
Accumulated deficit	(4,002)	(4,540)
Accumulated other comprehensive loss	(12)	(28)
Total stockholders' equity (deficit)	(126)	(760)
Total liabilities and stockholders' equity (deficit)	5,486	6,060
HD Supply, Inc
Current assets:
Cash and cash equivalents	73	85
Receivables, less allowance for doubtful accounts of $13 and $14	1,092	868
Inventories	868	784
Deferred tax asset	4	9
Current assets of discontinued operations		509
Other current assets	37	43
Total current assets	2,074	2,298
Property and equipment, net	327	340
Goodwill	2,869	2,869
Intangible assets, net	134	145
Non-current assets of discontinued operations		295
Other assets	78	113
Total assets	5,482	6,060
Current liabilities:
Accounts payable	651	510
Accrued compensation and benefits	129	144
Current installments of long-term debt	9	34
Current liabilities of discontinued operations		217
Other current liabilities	186	230
Total current liabilities	975	1,135
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	142	166
Other liabilities	108	296
Total liabilities	$ 5,610	$ 6,820
Stockholder's equity (deficit):
Common stock, par value $0.01; 1,000 shares authorized; 1,000 shares issued and outstanding
Paid-in capital	$ 3,783	$ 3,768
Accumulated deficit	(3,899)	(4,500)
Accumulated other comprehensive loss	(12)	(28)
Total stockholders' equity (deficit)	(128)	(760)
Total liabilities and stockholders' equity (deficit)	$ 5,482	$ 6,060

CONSOLIDATED BALANCE SHEETS (P8

CONSOLIDATED BALANCE SHEETS (Parenthetical) (HD Supply, Inc.) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Receivables, allowance for doubtful accounts (in dollars)	$ 13	$ 14
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	199,400,000	196,000,000
Common stock, shares outstanding	199,400,000	196,000,000
HD Supply, Inc
Receivables, allowance for doubtful accounts (in dollars)	$ 13	$ 14
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000	1,000
Common stock, shares issued	1,000	1,000
Common stock, shares outstanding	1,000	1,000

CONSOLIDATED STATEMENTS OF CAS9

CONSOLIDATED STATEMENTS OF CASH FLOWS (HD Supply, Inc.) - USD ($) $ in Millions	9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 601	$ 96
Reconciliation of net income to net cash provided by (used in) operating activities:
Depreciation and amortization	106	187
Provision for uncollectibles	5	6
Non-cash interest expense	18	19
Payment of discounts upon extinguishment of debt	(12)	(1)
Loss on extinguishment & modification of debt	100	2
Gain on sale of business	(186)
Stock-based compensation expense	14	12
Deferred income taxes	(15)	43
Other	(2)
Changes in assets and liabilities:
(Increase) decrease in receivables	(248)	(264)
(Increase) decrease in inventories	(124)	(96)
(Increase) decrease in other current assets	4	26
Increase (decrease) in accounts payable and accrued liabilities	93	85
Increase (decrease) in other long-term liabilities	(181)	6
Net cash provided by (used in) operating activities	173	121
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(61)	(92)
Proceeds from sales of property and equipment	2	3
Proceeds from sale of business, net	810
Net cash provided by (used in) investing activities	751	(89)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver debt	784	524
Repayments on long-term revolver debt	(850)	(554)
Debt issuance and modification costs	(6)	(3)
Other financing activities	1
Net cash provided by (used in) financing activities	(930)	(40)
Effect of exchange rates on cash and cash equivalents	(2)
Increase (decrease) in cash and cash equivalents	(8)	(8)
Cash and cash equivalents at beginning of period	85	115
Cash and cash equivalents at end of period	77	107
HD Supply, Inc
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	601	96
Reconciliation of net income to net cash provided by (used in) operating activities:
Depreciation and amortization	106	187
Provision for uncollectibles	5	6
Non-cash interest expense	18	19
Payment of discounts upon extinguishment of debt	(12)	(1)
Loss on extinguishment & modification of debt	100	2
Gain on sale of business	(186)
Stock-based compensation expense	14	12
Deferred income taxes	(15)	43
Other	(2)
Changes in assets and liabilities:
(Increase) decrease in receivables	(248)	(264)
(Increase) decrease in inventories	(124)	(96)
(Increase) decrease in other current assets	4	26
Increase (decrease) in accounts payable and accrued liabilities	93	85
Increase (decrease) in other long-term liabilities	(181)	6
Net cash provided by (used in) operating activities	173	121
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(61)	(92)
Proceeds from sales of property and equipment	2	3
Proceeds from sale of business, net	810
Net cash provided by (used in) investing activities	751	(89)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver debt	784	524
Repayments on long-term revolver debt	(850)	(554)
Debt issuance and modification costs	(6)	(3)
Other financing activities	1
Net cash provided by (used in) financing activities	(934)	(40)
Effect of exchange rates on cash and cash equivalents	(2)
Increase (decrease) in cash and cash equivalents	(12)	(8)
Cash and cash equivalents at beginning of period	85	111
Cash and cash equivalents at end of period	$ 73	$ 103

NATURE OF BUSINESS AND BASIS OF

NATURE OF BUSINESS AND BASIS OF PRESENTATION	9 Months Ended
	Nov. 01, 2015
NATURE OF BUSINESS AND BASIS OF PRESENTATION
NATURE OF BUSINESS AND BASIS OF PRESENTATION	NOTE 1 — NATURE OF BUSINESS AND BASIS OF PRESENTATION Nature of Business HD Supply Holdings, Inc. (“Holdings”) indirectly owns all of the outstanding common stock of HD Supply, Inc. (“HDS”). Holdings, together with its direct and indirect subsidiaries, including HDS (“HD Supply” or the “Company”), is one of the largest industrial distribution companies in North America. The Company specializes in three distinct market sectors: Maintenance, Repair & Operations; Infrastructure; and Specialty Construction. Through approximately 550 locations across 48 U.S. states and six Canadian provinces, the Company serves these markets with an integrated go-to-market strategy. HD Supply has approximately 14,000 associates delivering localized, customer-tailored products, services and expertise. The Company serves approximately 500,000 customers, which include contractors, maintenance professionals, home builders, industrial businesses, and government entities. HD Supply’s broad range of end-to-end product lines and services includes over 800,000 stock-keeping units (“SKUs”) of quality, name-brand and proprietary-brand products as well as value-add services supporting the entire life-cycle of a project from infrastructure and construction to maintenance, repair and operations. HD Supply is managed primarily on a product line basis and reports results of operations in three reportable segments. The reportable segments are Facilities Maintenance, Waterworks, and Construction & Industrial - White Cap. Other operating segments include Home Improvement Solutions, Interior Solutions, and HD Supply Canada. In addition, the consolidated financial statements include Corporate, which is comprised of enterprise-wide functional departments. Basis of Presentation In management’s opinion, the unaudited financial information for the interim periods presented includes all adjustments necessary for a fair statement of the results of operations, financial position, and cash flows. All adjustments are of a normal recurring nature unless otherwise disclosed. Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year. For a more complete discussion of the Company’s significant accounting policies and other information, you should read this report in conjunction with its annual report on Form 10-K, for the year ended February 1, 2015, which includes all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). Certain amounts in the prior-period financial statements have been reclassified to conform to the current period’s presentation. F iscal Year HD Supply’s fiscal year is a 52- or 53-week period ending on the Sunday nearest to January 31. Fiscal years ending January 31, 2016 (“fiscal 2015”) and February 1, 2015 (“fiscal 2014”) both include 52 weeks. The three months ended November 1, 2015 (“third quarter 2015”) and November 2, 2014 (“third quarter 2014”) both include 13 weeks. The nine months ended November 1, 2015 and November 2, 2014 both include 39 weeks. Principles of Consolidation The consolidated financial statements of HD Supply Holdings, Inc. present the results of operations, financial position and cash flows of HD Supply Holdings, Inc. and its wholly-owned subsidiaries, including HD Supply, Inc. The consolidated financial statements of HD Supply, Inc. present the results of operations, financial position and cash flows of HD Supply, Inc. and its wholly-owned subsidiaries. All material intercompany balances and transactions are eliminated. Results of operations of businesses acquired are included from their respective dates of acquisition. The results of operations of all discontinued operations have been separately reported as discontinued operations for all periods presented. Estimates Management has made a number of estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses in preparing these consolidated financial statements in conformity with GAAP. Actual results could differ from these estimates. Self-Insurance HD Supply has a high deductible insurance program for most losses related to general liability, product liability, environmental liability, automobile liability, workers’ compensation, and is self-insured for medical claims and certain legal claims. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Self-insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. At November 1, 2015 and February 1, 2015, self-insurance reserves totaled approximately $90 million and $92 million, respectively.

PUBLIC OFFERINGS

PUBLIC OFFERINGS	9 Months Ended
	Nov. 01, 2015
PUBLIC OFFERINGS
PUBLIC OFFERINGS	NOTE 2 — PUBLIC OFFERINGS On July 28, 2015, certain of Holdings’ stockholders, including an investment fund associated with Bain Capital Partners, LLC, and THD Holdings, LLC (collectively, the “Selling Stockholders”), completed the sale of 30,539,550 shares of Holdings’ Common Stock, under the previously filed and effective shelf registration statement (including a prospectus), at a price to the Selling Stockholders of $35.44 per share. The Company did not receive any of the proceeds from the sale of these shares and no shares were sold by the Company. As a result of the sale, the investment fund associated with Bain Capital Partners, LLC, and THD Holdings, LLC no longer own any shares of Holdings’ Common Stock. In connection with the offering, the Company incurred approximately $1 million of fees, reflected in Other income (expense), net within the Consolidated Statements of Operations and Comprehensive Income. During the nine months ended November 2, 2014 and in connection with fiscal 2014 public offerings, the Company incurred $2 million of fees, reflected in Other income (expense), net within the Consolidated Statements of Operations and Comprehensive Income.

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS	9 Months Ended
	Nov. 01, 2015
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS	NOTE 3 — DISCONTINUED OPERATIONS In October 2015, the Company completed the sale of its Power Solutions business. The Company received cash proceeds of approximately $810 million, net of $15 million of transaction costs. The Company realized approximately $20 million in cumulative currency translation losses related to the Canadian operations of the Power Solutions business unit. As a result of the sale, the Company recorded a $186 million pre-tax gain. In January 2015, the Company completed the sale of substantially all of the assets of its Hardware Solutions business. The Company received cash proceeds of approximately $198 million, net of $2 million of transaction costs. As a result of the sale, the Company recorded an $8 million pre-tax gain in fiscal 2014. In January 2014, the Company approved the disposal of Litemor, a specialty lighting distributor within the Company’s HD Supply Canada business. During fiscal 2014, the Company finalized the disposal process of Litemor through liquidation and branch sales, resulting in a pre-tax loss on disposal of $15 million, which includes cash and non-cash charges. Summary Financial Information In accordance with Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations” and Accounting Standards Update (“ASU”) 2014-08, “Reporting discontinued operations and disclosure of disposals of components of an entity,” the results of Power Solutions are classified as a discontinued operation. The results of the Hardware Solutions and Litemor operations and the gains/losses on sales of the businesses are also classified as discontinued operations. The presentation of discontinued operations includes revenues and expenses of the discontinued operations and gain/loss on the disposition of businesses, net of tax, as one line item on the Consolidated Statements of Operations and Comprehensive Income. All Consolidated Statements of Operations and Comprehensive Income presented have been revised to reflect this presentation. The following table provides additional detail related to the results of operations of the discontinued operations (amounts in millions): Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Net Sales $ $ $ $ Cost of sales Gross Profit Operating expenses: Selling, general and administrative Depreciation and amortization Restructuring — — — Total operating expenses Gain on sale of business — — Other (income) expense, net — — Income before provision for income taxes $ $ $ $ Provision (benefit) for income taxes Income from discontinued operations, net of tax $ $ $ $ At November 1, 2015 and February 1, 2015, the carrying amounts of major classes of assets and liabilities of discontinued operations included in the Consolidated Balance Sheets were as follows (amounts in millions): November 1, 2015 February 1, 2015 Current assets: Receivables, less allowance for doubtful accounts of $0 and $1 $ — $ Inventories — Other current assets — Total current assets — Goodwill — Intangible assets, net — Other non-current assets — Total assets of discontinued operations $ — $ Current liabilities: Accounts payable $ — $ Accrued compensation and benefits — Other current liabilities — Total liabilities of discontinued operations $ — $ For the nine months ended November 1, 2015, net cash provided by operating and investing activities, related to discontinued operations, were approximately $30 million and $808 million, respectively. Fiscal 2015 investing activities are inclusive of $810 million of net sales proceeds related to the Power Solutions transaction. For the nine months ended November 2, 2014, net cash provided by operating activities and used in investing activities, related to discontinued operations, were approximately $101 million and $16 million, respectively.

DEBT

DEBT	9 Months Ended
	Nov. 01, 2015
DEBT
DEBT	NOTE 4 — DEBT HDS’s long-term debt as of November 1, 2015 and February 1, 2015 consisted of the following (dollars in millions): November 1, 2015 February 1, 2015 Outstanding Principal Interest Rate %(1) Outstanding Principal Interest Rate %(1) Senior ABL Facility due 2018 $ 30 1.70 $ 96 2.02 Term Loans due 2021, net of unamortized discount of $11 million and $14 million 839 3.75 961 4.00 December 2014 First Priority Notes due 2021 1,250 5.25 1,250 5.25 April 2012 Second Priority Notes due 2020 — — 675 11.00 October 2012 Senior Unsecured Notes due 2020 1,000 11.50 1,000 11.50 February 2013 Senior Unsecured Notes due 2020 1,275 7.50 1,275 7.50 Total long-term debt $ 4,394 $ 5,257 Less current installments (9 ) (34 ) Long-term debt, excluding current installments $ 4,385 $ 5,223 (1) Represents the stated rate of interest, without including the effect of discounts. On October 13, 2015, HDS used proceeds from the sale of the Power Solutions business unit to redeem all of the outstanding $675 million aggregate principal amount of its April 2012 Second Priority Notes, as defined below, and paid a $72 million make-whole premium calculated in accordance with the terms of the indenture governing such notes and $37 million of accrued but unpaid interest to the redemption date. As a result, the Company recorded an $80 million loss on extinguishment of debt, which includes the $72 million make-whole premium and the write-off of $8 million of unamortized deferred financing costs, in accordance with ASC 470-50, “Debt — Modifications and Extinguishments.” On August 13, 2015, HDS entered into an incremental amendment (the “Incremental Agreement”) to the credit agreement governing its Term Loan Facility, as defined below, pursuant to which HDS requested a borrowing of a new $850 million tranche of senior secured term loans (“Term Loans”), the proceeds of which, together with cash on hand and available borrowings under HDS’s Senior ABL Facility, were used to prepay in full the tranche of senior secured term loans outstanding under the Term Loan Facility as of the date of the Incremental Agreement. Pursuant to the Incremental Agreement, the Term Loans will mature on August 13, 2021 and bear interest at the reduced applicable margin for borrowings of 2.75% for LIBOR borrowings and 1.75% for base rate borrowings (down from, respectively, 3.00% and 2.00% applicable to the redeemed term loans), with the LIBOR floor to remain at 1.00%. The Term Loans amortize in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of such Term Loans, beginning in December 2015 with the balance payable on such Term Loans’ maturity date. The Incremental Agreement also provides for a prepayment premium equal to 1.00% of the aggregate principal amount of Term Loans being prepaid if, on or prior to February 13, 2016, the Company enters into certain repricing transactions. In connection with the amendment, the Company recorded a modification and extinguishment charge of $20 million, which includes financing fees of $5 million and $15 million to write off a portion of the related unamortized discount and deferred financing costs, in accordance with ASC 470-50, “Debt — Modifications and Extinguishments.” Senior Credit Facilities Asset Based Lending Facility HDS’s Senior Asset Based Lending Facility (“Senior ABL Facility”) provides for senior secured revolving loans and letters of credit of up to a maximum aggregate principal amount of $1,500 million (subject to availability under a borrowing base). Extensions of credit under the Senior ABL Facility are limited by a borrowing base calculated periodically based on specified percentages of the value of eligible inventory and eligible accounts receivable, subject to certain reserves and other adjustments. A portion of the Senior ABL Facility is available for letters of credit and swingline loans. As of November 1, 2015, HDS had $1,225 million of additional available borrowings under the Senior ABL Facility (after giving effect to the borrowing base limitations and approximately $34 million in letters of credit issued and including $44 million of borrowings available on qualifying cash balances). At HDS’s option, the interest rates applicable to the loans under the Senior ABL Facility are based (i) in the case of U.S. dollar-denominated loans, either at London Interbank Offered Rate (“LIBOR”) plus an applicable margin, or Prime Rate plus an applicable margin and (ii) in the case of Canadian dollar-denominated loans, either the BA rate plus an applicable margin, or the Canadian Prime Rate plus an applicable margin. The margins applicable for each elected interest rate are subject to a pricing grid, as defined in the agreement governing the Senior ABL Facility, based on average excess availability for the previous fiscal quarter. The Senior ABL Facility also contains a letter of credit fee computed at a rate per annum equal to the Applicable Margin (as defined in the agreement) then in effect for LIBOR Loans and an unused commitment fee subject to a pricing grid, as included in the agreement governing the Senior ABL Facility, based on the Average Daily Used Percentage (as defined in the agreement). The Senior ABL Facility also permits HDS to add one or more incremental term loan facilities to be included in the Senior ABL Facility or one or more revolving credit facility commitments to be included in the Senior ABL Facility. The Senior ABL Facility will mature on June 28, 2018 (or the maturity date under HDS’s Term Loan Facility, if earlier). Senior Secured Term Loan Facility HDS’s Senior Term Facility consists of a senior secured Term Loan Facility (the “Term Loan Facility,” the term loans thereunder, the “Term Loans”) providing for Term Loans in an original aggregate principal amount of $850 million. The Term Loan Facility will mature on August 13, 2021 (the “Term Loan Maturity Date”). The Term Loans amortize in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Term Loan Facility beginning December 2015 with the balance payable on the Term Loan Maturity Date. The Term Loans bear interest at the applicable margin for borrowings of 2.75% for LIBOR borrowings and 1.75% for base rate borrowings, with the LIBOR floor at 1.00%. During the first quarter of fiscal 2015 and in accordance with the annual excess cash flow (“ECF”) provisions of the Term Loan Facility, the Company offered a prepayment of $34 million based on the ECF calculation for fiscal 2014. The lenders in the Term Loan Facility accepted $16 million, which the Company paid on March 30, 2015. In accordance with the Incremental Agreement, the ECF provisions are applicable beginning with the fiscal year ending on or about February 1, 2017 (fiscal 2016) and each fiscal year thereafter. The ECF provision is not applicable to fiscal 2015. For additional information on our Senior Credit Facilities, including guarantees and security, please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K, for the fiscal year ended February 1, 2015. Secured Notes 5.25% Senior Secured First Priority Notes due 2021 HDS’s 5.25% Senior Secured First Priority Notes due 2021 (the “December 2014 First Priority Notes”) bear interest at 5.25% per annum and will mature on December 15, 2021. Interest is paid semi-annually in arrears on June 15 th and December 15 th of each year. Redemption HDS may redeem the December 2014 First Priority Notes, in whole or in part, at any time (1) prior to December 15, 2017, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus the applicable make-whole premium set forth in the indenture governing the December 2014 First Priority Notes and (2) on and after December 15, 2017, at the applicable redemption price set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to the relevant redemption date, if redeemed during the 12-month period commencing on December 15 of the year set forth below. Year Percentage 2017 103.938 % 2018 102.625 % 2019 101.313 % 2020 and thereafter 100.000 % In addition, at any time prior to December 15, 2017, HDS may redeem on one or more occasions up to 40% of the aggregate principal amount of the December 2014 First Priority Notes with the proceeds of certain equity offerings at a redemption price of 105.25% of the principal amount in respect of the December 2014 First Priority Notes being redeemed, plus accrued and unpaid interest to the redemption date, provided, however, that if the December 2014 First Priority Notes are redeemed, an aggregate principal amount of December 2014 First Priority Notes equal to at least 50% of the original aggregate principal amount of December 2014 First Priority Notes must remain outstanding immediately after each such redemption of December 2014 First Priority Notes. Collateral The December 2014 First Priority Notes and the related guarantees are secured by a first-priority security interest in substantially all of the tangible and intangible assets of HDS and the Subsidiary Guarantors (other than the ABL Priority Collateral (as defined in the indenture governing the December 2014 First Priority Notes), in which the December 2014 First Priority Notes and the related guarantees have a second-priority security interest), including pledges of all Capital Stock of HDS’s restricted subsidiaries directly owned by HDS and the Subsidiary Guarantors (but only up to 65% of each series of Capital Stock of each direct Foreign Subsidiary owned by HDS or any Subsidiary Guarantor), subject to certain thresholds, exceptions and permitted liens, and excluding any Excluded Assets and Excluded Subsidiary Securities (each as defined in the indenture governing the December 2014 First Priority Notes and together the “Cash Flow Priority Collateral”). The indenture governing the December 2014 First Priority Notes and the applicable collateral documents provide that any capital stock and other securities of any of HDS’s subsidiaries will be excluded from the collateral to the extent the pledge of such capital stock or other securities to secure the December 2014 First Priority Notes would cause such subsidiary to be required to file separate financial statements with the U.S. Securities and Exchange Commission (“SEC”) pursuant to Rule 3-16 of Regulation S-X (as in effect from time to time). For additional information on the December 2014 First Priority Notes, including guarantees and security, please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K, for the fiscal year ended February 1, 2015. 11% Senior Secured Second Priority Notes due 2020 HDS’s 11% Senior Secured Second Priority Notes due 2020 (the “April 2012 Second Priority Notes”) bore interest at 11% per annum and were set to mature on April 15, 2020. Interest was paid semi-annually in arrears on April 15th and October 15th of each year, prior to the October 13, 2015 redemption. Unsecured Notes 11.5% Senior Unsecured Notes due 2020 HDS’s 11.5% Senior Unsecured Notes due 2020 (the “October 2012 Senior Unsecured Notes”) bear interest at 11.5% per annum and will mature on July 15, 2020. Interest is paid semi-annually in arrears on April 15 th and October 15 th of each year. Redemption HDS may redeem the October 2012 Senior Unsecured Notes, in whole or in part, at any time (1) prior to October 15, 2016, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus the applicable make-whole premium set forth in the indenture governing the October 2012 Senior Unsecured Notes and (2) on and after October 15, 2016, at the applicable redemption price set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to the relevant redemption date, if redeemed during the 12-month period commencing on October 15 of the year set forth below. Year Percentage 2016 105.750 % 2017 102.875 % 2018 and thereafter 100.000 % 7.5% Senior Unsecured Notes due 2020 HDS’s 7.5% Senior Unsecured Notes due 2020 (the “February 2013 Senior Unsecured Notes”) bear interest at 7.5% per annum and will mature on July 15, 2020. Interest is paid semi-annually in arrears on April 15 th and October 15 th of each year. Redemption HDS may redeem the February 2013 Senior Unsecured Notes, in whole or in part, at any time (1) prior to October 15, 2016, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus the applicable make-whole premium set forth in the indenture governing the February 2013 Senior Notes and (2) on and after October 15, 2016, at the applicable redemption price set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to the relevant redemption date, if redeemed during the 12-month period commencing on October 15 of the year set forth below. Year Percentage 2016 103.750 % 2017 101.875 % 2018 and thereafter 100.000 % Debt covenants HDS’s outstanding debt agreements contain various restrictive covenants including, but not limited to, limitations on additional indebtedness and dividend payments and stipulations regarding the use of proceeds from asset dispositions. As of November 1, 2015, HDS was in compliance with all such covenants that were in effect on such date.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	9 Months Ended
	Nov. 01, 2015
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS	NOTE 5 — FAIR VALUE MEASUREMENTS The fair value measurements and disclosure principles of GAAP (ASC 820, Fair Value Measurements and Disclosures) define fair value, establish a framework for measuring fair value and provide disclosure requirements about fair value measurements. These principles define a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 — Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly; Level 3 — Unobservable inputs in which little or no market activity exists. The Company’s financial instruments that are not reflected at fair value on the Consolidated Balance Sheets were as follows as of November 1, 2015 and February 1, 2015 (amounts in millions): As of November 1, 2015 As of February 1, 2015 Recorded Amount(1) Estimated Fair Value Recorded Amount(1) Estimated Fair Value Senior ABL Facility $ $ $ $ Term Loans and Notes Total $ $ $ $ (1) These amounts do not include accrued interest; accrued interest is classified as Other current liabilities in the accompanying Consolidated Balance Sheets. These amounts do not include any related discounts or premiums. The Company utilized Level 2 inputs, as defined in the fair value hierarchy, to measure the fair value of the long-term debt. Management’s fair value estimates were based on quoted prices for recent trades of HDS’s long-term debt, recent similar credit facilities initiated by companies with like credit quality in similar industries, quoted prices for similar instruments, and inquiries with certain investment communities.

INCOME TAXES

INCOME TAXES	9 Months Ended
	Nov. 01, 2015
INCOME TAXES
INCOME TAXES	NOTE 6 — INCOME TAXES The Company’s combined federal, state, and foreign effective tax rate for continuing operations for the first nine months of fiscal 2015 is an 80% benefit. The benefit was mainly driven by a decrease of $189 million in the Company’s unrecognized U.S. federal and state tax benefits related to the February 19, 2015 approval and finalization of the Tentative Settlement (as defined in “Note 10, Commitment and Contingencies”) by the Joint Committee of Taxation. In addition, the Company’s rate was impacted by the utilization of deferred tax assets which had previously been subject to a valuation allowance, increasing the deferred tax liability for U.S. goodwill amortization for tax purposes, and the accrual of income taxes for foreign and certain state jurisdictions. The Company’s effective tax rate will vary based on a variety of factors, including overall profitability, the geographical mix of income before taxes and the related tax rates in the jurisdictions where it operates, restructuring and other one-time charges, as well as discrete events, such as settlements of future audits. An increase in U.S. pre-tax book income resulted in the utilization of net deferred tax assets including U.S. tax net operating losses that were subject to a valuation allowance. The overall decrease in the valuation allowance was partially offset by an increase of the deferred tax liability for U.S. goodwill amortization for tax purposes. The deferred tax liability related to the Company’s U.S. tax deductible goodwill is considered a liability related to an asset with an indefinite life. Therefore, the deferred tax liability does not amortize and is not available as a source of taxable income to support the realization of deferred tax assets created by other deductible temporary timing differences. The Company does not believe it is “more likely than not” that it will realize its U.S. deferred tax assets equal to the deferred liability created by tax deductible goodwill. During the three and nine months ended November 1, 2015, the impact of the tax amortization of the indefinite lived intangibles on tax expense was an $11 million and $26 million increase, respectively. As of February 1, 2015, the Company’s unrecognized tax benefits in accordance with the income taxes principles of GAAP (ASC 740, Income Taxes) were $187 million. During the nine months ended November 1, 2015, the Company’s unrecognized tax benefits decreased by $179 million to $8 million primarily driven by IRS and state audit settlements. During the three and nine months ended November 1, 2015, the Company’s interest accrual related to unrecognized tax benefits remained unchanged. The Company’s ending net accrual for interest and penalties related to unrecognized tax benefits as of February 1, 2015 was $29 million and decreased to $1 million as of November 1, 2015. As a result of the approval and finalization of the Tentative Settlement, the tax years ending February 3, 2008 and February 1, 2009 are settled and closed to any further adjustments. Over the next twelve months, it is reasonably possible that the Company’s unrecognized tax benefits will decrease by up to $1 million. At November 1, 2015 and February 1, 2015, the Company’s valuation allowance on its U.S. deferred tax assets was approximately $845 million and $1,013 million, respectively. Each reporting period we assess available positive and negative evidence and estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. Through fiscal 2013, the Company’s history of U.S. operating losses limited the weight applied to other subjective evidence such as the Company’s projections for future profitability. With the Company’s fiscal 2014 U.S. pretax income, long carryforward periods in its U.S. federal tax losses and similar carryforward periods in a significant portion of its state tax losses, and projected fiscal 2015 and fiscal 2016 U.S. pretax income, management believes it is reasonably possible that sufficient positive evidence will exist during the next twelve months to release all or a significant portion of the valuation allowance on the Company’s U.S. deferred tax assets. See “Note 10, Commitments and Contingencies,” for discussion of the IRS audit of the Company’s U.S. federal income tax returns.

BASIC AND DILUTED WEIGHTED AVER

BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES	9 Months Ended
	Nov. 01, 2015
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES	NOTE 7—BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES The following basic and diluted weighted average common shares information is provided for HD Supply Holdings, Inc. The reconciliation of basic to diluted weighted average common shares for the three and nine months ended November 1, 2015 and November 2, 2014 was as follows (in thousands): Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Weighted average common shares Effect of potentially dilutive securities: Stock plans Diluted weighted average common shares Stock plan securities excluded from dilution (1) (1) Represents securities not included in the computation of diluted earnings per share because their effect would have been anti-dilutive. Stock plans consist of securities (stock options, restricted stock and restricted stock units) granted under Holdings’ stock-based compensation plans.

SUPPLEMENTAL BALANCE SHEET AND

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION	9 Months Ended
	Nov. 01, 2015
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION	NOTE 8 — SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION Receivables Receivables consisted of the following (amounts in millions): November 1, 2015 February 1, 2015 Trade receivables, net of allowance for doubtful accounts $ $ Vendor rebate receivables Other receivables Total receivables, net $ $ Other Current Liabilities Other current liabilities consisted of the following (amounts in millions): HD Supply Holdings, Inc. HD Supply, Inc. November 1, 2015 February 1, 2015 November 1, 2015 February 1, 2015 Accrued interest $ $ $ $ Accrued non-income taxes Other Total other current liabilities $ $ $ $ Supplemental Cash Flow Information Cash paid for interest in the nine months ended November 1, 2015 and November 2, 2014 was $354 million and $426 million, respectively. During the nine months ended November 1, 2015, the Company paid $12 million of original issue discounts related to the portion of the August 2015 Term Loan amendment considered an extinguishment under ASC 470-50,”Debt — Modifications and Extinguishments.” Additionally, during the nine months ended November 2, 2014, the Company paid $1 million of original issue discounts related to the portion of the February 2014 Term Loan amendment considered an extinguishment under ASC 470-50. Cash paid for income taxes, net of refunds, in the nine months ended November 1, 2015 and November 2, 2014 was approximately $14 million and $37 million, respectively. Significant Non-Cash Transactions During the three and nine months ended November 1, 2015, Holdings retired 1,384,622 and 1,976,053 shares, respectively, of its common stock (“Retired Shares”) held as Treasury Shares by Holdings in the amounts of $46 million and $63 million, respectively. All of these shares were repurchased by Holdings pursuant to the share repurchase program previously authorized. Holdings reinstated the Retired Shares to the status of authorized but unissued shares of common stock, par value $0.01 per share, effective as of the date of retirement. In accordance with ASC 505-30, Equity-Treasury Stock, Holdings reversed the $0.01 par value of the Retired Shares and the excess of the cost of the Retired Shares over par value to Retained Earnings.

RESTRUCTURING ACTIVITIES

RESTRUCTURING ACTIVITIES	9 Months Ended
	Nov. 01, 2015
RESTRUCTURING ACTIVITIES
RESTRUCTURING ACTIVITIES	NOTE 9—RESTRUCTURING ACTIVITIES As a result of the sale of the Power Solutions business unit, management evaluated the Company’s talent alignment and functional support strategies. Consequently, the Company expects to take a $10 million to $20 million charge over the next twelve months and expects a payback via a permanent reduction in cost over the next two years. This charge reflects costs primarily for severance, relocation and related costs. During the three and nine months ended November 1, 2015, the Company recorded $4 million of the expected charges, primarily related to severance and other employee-related costs at Facilities Maintenance and Waterworks. Payments for these initial charges are expected to be substantially complete in the next twelve months. As of November 1, 2015, the liability balances for these restructuring activities was $4 million and is included in Other current liabilities in the Consolidated Balance Sheets.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Nov. 01, 2015
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	NOTE 10 — COMMITMENTS AND CONTINGENCIES Internal Revenue Service The Company carried back tax net operating losses (“NOL”) from its tax years ended on February 3, 2008 and February 1, 2009 to tax years during which it was a member of The Home Depot Inc.’s (“Home Depot”) U.S. federal consolidated tax group. As a result of those NOL carrybacks, Home Depot received cash refunds from the IRS in the amount of approximately $354 million. Under an agreement (the “Agreement”) between the Company and Home Depot, Home Depot paid the Company the refund proceeds resulting from the NOL carrybacks. In January 2013 in connection with an audit of the Company’s U.S. federal income tax returns filed for the tax years ended on February 3, 2008 and February 1, 2009, the IRS issued a Revenue Agent’s Report (“RAR”) which proposed to disallow certain deductions claimed by the Company and a significant portion of the corresponding cash refunds resulting from the Company’s NOL carrybacks. Pursuant to the terms of the Agreement, the Company would be required to reimburse Home Depot an amount equal to the disallowed refunds plus related interest. In collaboration with Home Depot, the Company challenged the proposed adjustments of the RAR by filing a formal protest with the IRS Office of Appeals. In July 2014, the Company reached a tentative settlement (“Tentative Settlement”) for approximately $27 million with the IRS Office of Appeals on the outstanding RAR. In order to stop the accrual of interest on the Tentative Settlement amount and as required under the Agreement, in August 2014 the Company made a payment of approximately $27 million to Home Depot which Home Depot then paid to the IRS. As a result of the Tentative Settlement, the Company’s deferred tax assets increased by approximately $12 million before the impact of the valuation allowance. The Tentative Settlement and the carryback claims were subject to review by the Joint Committee on Taxation (“JCT”) and the Tentative Settlement does not become effective nor are the carryback claims finalized until the JCT reviews them without objection or the IRS Office of Appeals executes such settlement, whichever comes first. The JCT is required to review refunds in excess of $2 million. On February 19, 2015, the Company received notification the Tentative Settlement was approved by the JCT. As a result of the approval and finalization of the Tentative Settlement, the tax years ending February 3, 2008 and February 1, 2009 are settled and closed to any further adjustments. See “Note 6, Income Taxes,” for further disclosures on the Company’s income taxes. Legal Matters On August 11, 2015, HD Supply Waterworks, Ltd., and the United States of America, acting through the United States Attorney’s Office for the Northern District of New York and on behalf of the United States Environmental Protection Agency and the United States Department of Transportation (collectively the “United States”) entered into a civil settlement agreement in connection with the previously disclosed investigation of the Company by the United States related to the activities of certain disadvantaged business enterprises, including American Indian Builders and Suppliers, Inc. Under the terms of the settlement agreement, the Company, in exchange for a release of certain civil and administrative monetary claims, paid the United States $4.945 million, which is an amount within the Company’s previously established reserve for such matter. In addition, on September 21, 2015, the Company entered into an Administrative Settlement and Compliance Agreement (the “AS&C Agreement”) with the Federal Highway Administration (“FHWA”), an Operating Administration of the United States Department of Transportation, related to the same conduct at issue in the United States investigation. Under the terms of the agreement, which will be effective for a period of three years, HD Supply Waterworks has agreed to undertake, and has already undertaken, certain remedial measures, including (a) commitment to continue to be bound by its Code of Business Conduct and Ethics; (b) a Corporate Compliance Program; (c) appointment of a Corporate Compliance Officer who was not involved in the conduct at issue in the United States investigation; and (d) retention of an independent monitor to evaluate Waterworks’ performance of the AS&C Agreement and to submit periodic reports directly to FHWA. In exchange, the FHWA has agreed not to initiate or pursue any suspension or debarment action against HD Supply Waterworks, the Company, or their affiliated entities, based on the conduct at issue in the United States investigation unless HD Supply Waterworks materially breaches the AS&C Agreement. While the Company believes that HD Supply Waterworks will not materially breach its obligations under the AS&C Agreement, there can be no assurances that the FHWA will not initiate or pursue any suspension or debarment proceedings in the future. HD Supply is involved in various legal proceedings arising in the normal course of its business. The Company establishes reserves for litigation and similar matters when those matters present loss contingencies that it determines to be both probable and reasonably estimable in accordance with ASC 450, Contingencies. In the opinion of management, based on current knowledge, all reasonably estimable and probable matters, including the government matters described above, are believed to be adequately reserved for or covered by insurance and are not expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows. For all other matters, except as noted below, management believes the possibility of losses from such matters is not probable, the potential loss from such matters is not reasonably estimable, or such matters, if disposed of unfavorably to the Company, are of such kind or involve such amounts that would not have a material adverse effect on the financial position, results of operations or cash flows of the Company. For material matters that are reasonably possible and reasonably estimable, including matters that are probable and estimable but for which the amount that is reasonably possible is in excess of the amount that the Company has accrued for, management has estimated the aggregate range of potential loss as $0 to $10 million. If a material loss is probable or reasonably possible, and in either case estimable, the Company has considered it in the analysis and it is included in the discussion set forth above.

SEGMENT INFORMATION

SEGMENT INFORMATION	9 Months Ended
	Nov. 01, 2015
SEGMENT INFORMATION
SEGMENT INFORMATION	NOTE 11 — SEGMENT INFORMATION HD Supply’s operating segments are based on management structure and internal reporting. Each segment offers different products and services to the end customer, except for Corporate, which provides general corporate overhead support. The Company determines its reportable segments in accordance with the principles of segment reporting within ASC 280, Segment Reporting. For purposes of evaluation under these segment reporting principles, the Chief Operating Decision Maker for HD Supply assesses HD Supply’s ongoing performance, based on the periodic review and evaluation of Net sales, Adjusted EBITDA, and certain other measures for each of the operating segments. HD Supply has three reportable segments, each of which is presented below: · Facilities Maintenance —Facilities Maintenance distributes maintenance, repair and operations (“MRO”) products, provides value-add services and fabricates custom products to multifamily, hospitality, healthcare and institutional facilities. · Waterworks —Waterworks distributes complete lines of water and wastewater transmission products, serving contractors and municipalities in the water and wastewater industries for non-residential and residential uses. · Construction & Industrial - White Cap —Construction & Industrial - White Cap distributes specialized hardware, tools, engineered materials and safety products to non-residential and residential contractors. In addition to the reportable segments, the Company’s consolidated financial results include “Corporate & Other.” Corporate & Other is comprised of the following operating segments: Interior Solutions, Home Improvement Solutions and HD Supply Canada. Interior Solutions offers turnkey supply and installation services for multiple interior finish options, including flooring, cabinets, countertops, and window coverings, along with comprehensive design center services for non-residential, residential and senior living projects. Home Improvement Solutions offers light remodeling and construction supplies, kitchen and bath cabinets, windows, plumbing materials, electrical equipment and other products, primarily to small remodeling contractors and trade professionals. HD Supply Canada is an industrial distributor that primarily focuses on servicing fasteners/industrial supplies markets operating across six Canadian provinces. Corporate & Other also includes costs related to our centralized support functions, which are comprised of finance, information technology, human resources, legal, supply chain and other support services, and removes inter-segment transactions. The following tables present Net sales, Adjusted EBITDA, and other measures for each of the reportable segments and total continuing operations for the periods indicated (amounts in millions): Facilities Maintenance Waterworks Construction & Industrial - White Cap Corporate & Other Total Continuing Operations Three Months Ended November 1, 2015 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization Three Months Ended November 2, 2014 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization — Nine Months Ended November 1, 2015 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization Nine Months Ended November 2, 2014 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization (1) Depreciation includes amounts recorded within Cost of sales in the Consolidated Statements of Operations and Comprehensive Income. Reconciliation to Consolidated Financial Statements Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Total Adjusted EBITDA $ $ $ $ Depreciation and amortization (1) Stock-based compensation Restructuring — Other ) — ) ) Operating income Interest expense, net Loss on extinguishment & modification of debt (2) — Other (income) expense, net (3) — ) ) Income from Continuing Operations Before Provision for Income Taxes Provision (benefit) for income taxes (4) ) Income from continuing operations Income from discontinued operations, net of tax Net Income $ $ $ $ (1) Depreciation and amortization includes amounts recorded within Cost of sales in the Consolidated Statements of Operations. (2) Represents the loss on extinguishment of debt including the premium paid to repurchase or call the debt as well as the write-off of unamortized deferred financing costs and other assets or liabilities associated with such debt. Also includes the costs of debt modification. (3) Represents the costs expensed in connection with secondary offerings of Holdings’ common stock by certain of Holdings’ stockholders. (4) During the nine months ended November 1, 2015, the Company recorded a reduction in unrecognized tax benefits as a result of IRS and state audit settlements. See “Note 6, Income Taxes” and “Note 10, Commitments and Contingencies” for discussion of the IRS audit settlement.

SUBSIDIARY GUARANTORS

SUBSIDIARY GUARANTORS	9 Months Ended
	Nov. 01, 2015
SUBSIDIARY GUARANTORS
SUBSIDIARY GUARANTORS	NOTE 12—SUBSIDIARY GUARANTORS HDS (the “Debt Issuer”) has outstanding December 2014 First Priority Notes, October 2012 Senior Unsecured Notes, and February 2013 Senior Unsecured Notes (collectively the “Notes”), which are guaranteed by certain of its subsidiaries (the “Subsidiary Guarantors”). The Subsidiary Guarantors are direct or indirect wholly-owned domestic subsidiaries of HDS. The subsidiaries of HDS that do not guarantee the Notes (“Non-guarantor Subsidiaries”) are direct or indirect wholly-owned subsidiaries of HDS and primarily include HDS’s operations in Canada. The Debt Issuer’s payment obligations under the Notes are jointly and severally guaranteed by the guarantors and all guarantees are full and unconditional. These guarantees are subject to release under the circumstances as described below: (i) concurrently with any direct or indirect sale or disposition (by merger or otherwise) of any Subsidiary Guarantor or any interest therein in accordance with the terms of the applicable indebtedness by HDS or a restricted subsidiary, following which such Subsidiary Guarantor is no longer a restricted subsidiary of HDS; (ii) at any time that such Subsidiary Guarantor is released from all of its obligations under all of its guarantees of payment of any indebtedness of HDS or any Subsidiary Guarantor under all other indebtedness and is not a borrower under the Senior ABL Facility; (iii) upon the merger or consolidation of any Subsidiary Guarantor with and into HDS or another Subsidiary Guarantor that is the surviving entity in such merger or consolidation, or upon the liquidation of such Subsidiary Guarantor following the transfer of all of its assets to HDS or another Subsidiary Guarantor; (iv) concurrently with any Subsidiary Guarantor becoming an unrestricted subsidiary; (v) during the period when the rating on the notes is changed to investment grade and certain covenants cease to apply while such investment grade rating is maintained, upon the merger or consolidation of any Subsidiary Guarantor with and into another subsidiary that is not a Subsidiary Guarantor with such other subsidiary being the surviving entity in such merger or consolidation, or upon liquidation of such Subsidiary Guarantor following the transfer of all of its assets to a subsidiary that is not a Subsidiary Guarantor; (vi) upon legal or covenant defeasance of HDS’s obligations under the applicable indebtedness, or satisfaction and discharge of the indenture governing the applicable indebtedness; or (vii) subject to customary contingent reinstatement provisions, upon payment in full of the aggregate principal amount of all applicable indebtedness then outstanding and all other obligations guaranteed by a Subsidiary Guarantor then due and owing. In addition, HDS has the right, upon 30 days’ notice to the applicable trustee, to cause any Subsidiary Guarantor that has not guaranteed payment of any indebtedness of HDS or any Subsidiary Guarantor under all other indebtedness and is not a borrower under the Senior ABL Facility to be unconditionally released from all obligations under its Subsidiary Guarantee, and such Subsidiary Guarantee shall thereupon terminate and be discharged and of no further force or effect. In connection with the issuance of the Notes, HDS determined the need for compliance with Rule 3-10 of SEC Regulation S-X. In lieu of providing separate audited financial statements for the Guarantor Subsidiaries, HDS has included the accompanying Condensed Consolidating Financial Statements in accordance with Rule 3-10(f) of SEC Regulation S-X. The following supplemental financial information sets forth, on a consolidating basis under the equity method of accounting, the condensed statements of operations and comprehensive income, the condensed balance sheets, and the condensed statements of cash flows for the Debt Issuer, for the Subsidiary Guarantors and the Non-guarantor Subsidiaries and total consolidated Debt Issuer and subsidiaries (amounts in millions). CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Three Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — — Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — — Restructuring Charge — — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net — — — — — Net (earnings) loss of equity affiliates ) — — — Income From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) — Income from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) — Net Income (Loss) $ $ $ ) $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment — ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Three Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative — Depreciation and amortization — Total operating expenses — Operating Income (Loss) ) ) Interest expense — ) Interest (income) ) ) — — Other (income) expense, net ) — — — ) Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) ) — Income (Loss) from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment ) — ) ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Nine Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — Restructuring charge — — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net — — — Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) — ) Income (Loss) from Continuing Operations ) Income from discontinued operations, net of tax — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment — ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Nine Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — Restructuring — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net ) — — — ) Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) ) — Income (Loss) from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) ) — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment ) — ) ) Total Comprehensive Income (Loss) $ $ $ $ ) $ CONDENSED CONSOLIDATING BALANCE SHEETS As of November 1, 2015 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS ASSETS Current assets: Cash and cash equivalents $ $ $ $ — $ Receivables, net — Inventories — — Deferred tax asset — ) Other current assets — Total current assets ) Property and equipment, net — Goodwill — — — Intangible assets, net — — Deferred tax asset — — — Investment in subsidiaries — — ) — Intercompany notes receivable — ) — Other assets — — Total assets $ $ $ $ ) $ LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) Current liabilities: Accounts payable $ $ $ $ — $ Accrued compensation and benefits — Current installments of long-term debt — — — Deferred tax liabilities — — ) — Other current liabilities — Total current liabilities ) Long-term debt, excluding current installments — — — Deferred tax liabilities — — Intercompany notes payable — ) — Other liabilities — Total liabilities ) Stockholder’s equity (deficit) ) ) ) Total liabilities and stockholder’s equity (deficit) $ $ $ $ ) $ As of February 1, 2015 Debt Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Total HDS ASSETS Current assets: Cash and cash equivalents $ $ $ $ — $ Receivables, net — Inventories — — Deferred tax asset — ) Current assets of discontinued operations — Other current assets — Total current assets ) Property and equipment, net — Goodwill — — Intangible assets, net — — Deferred tax asset — ) Non-current assets of discontinued operations — — Investment in subsidiaries — — ) — Intercompany notes receivable — ) — Other assets — — Total assets $ $ $ $ ) $ LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) Current liabilities: Accounts payable $ $ $ $ — $ Accrued compensation and benefits — Current installments of long-term debt — — — Deferred tax liabilities — — ) — Current liabilities of discontinued operations — — Other current liabilities — Total current liabilities ) Long-term debt, excluding current installments — — — Deferred tax liabilities — — ) Intercompany notes payable — ) — Other liabilities — Total liabilities ) Stockholder’s equity (deficit) ) ) ) Total liabilities and stockholder’s equity (deficit) $ $ $ $ ) $ CONDENSED CONSOLIDATING CASH FLOW STATEMENTS Nine Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS Net cash flows from operating activities $ $ $ $ — $ Cash flows from investing activities Capital expenditures ) ) — — ) Proceeds from sale of property and equipment — — — Proceeds from sale of a business — — — Investments in equity affiliates - Return of capital — — ) — Proceeds from (payments of) intercompany notes — — ) — Other investing activities — — — — — Net cash flows from investing activities ) — ) Cash flows from financing activities Equity contribution (return of capital) — ) ) — Borrowings from (repayments to) intercompany notes ) — — — Borrowings of long-term debt — — — Repayments of long-term debt ) — — — ) Borrowings on long-term revolver — — — Repayments on long-term revolver ) — — — ) Debt issuance and modification fees ) — — — ) Other financing activities — — — Net cash flows from financing activities ) ) ) ) Effect of exchange rates on cash — — ) — ) Net increase (decrease) in cash & cash equivalents $ $ ) $ ) $ — $ ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ — $ Nine Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS Net cash flows from operating activities $ $ $ $ — $ Cash flows from investing activities Capital expenditures ) ) ) — ) Investments in equity affiliates - Return of capital — — ) — Proceeds from sale of property and equipment — — — Proceeds from (payments of) intercompany notes — — ) — Other investing activities — — ) — Net cash flows from investing activities ) ) ) ) Cash flows from financing activities Equity contribution (return of capital) — — ) — Borrowings (repayments) of intercompany notes ) — — — Borrowings of long-term debt — — — Repayments of long-term debt ) — — — ) Borrowings on long-term revolver — — — Repayments of long-term revolver ) — — — ) Debt issuance and modification fees ) — — — ) Other financing activities ) — — Net cash flows from financing activities ) — ) ) Effect of exchange rates on cash — — — — — Net increase (decrease) in cash & cash equivalents $ ) $ $ ) $ — $ ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ — $

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	9 Months Ended
	Nov. 01, 2015
RECENT ACCOUNTING PRONOUNCEMENTS
RECENT ACCOUNTING PRONOUNCEMENTS	NOTE 13—RECENT ACCOUNTING PRONOUNCEMENTS Inventory — In July 2015, The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2015-11, “Inventory, Simplifying the Measurement of Inventory” (“ASU 2015-11”). The amended guidance requires that inventory be measured at the lower of cost and net realizable value. The amended guidance is limited to inventory measured using the first-in, first-out (“FIFO”) or average cost methods and excludes inventory measured using last-in, first-out (“LIFO”) or retail inventory methods. ASU 2015-11 is effective for fiscal years, and interim periods, beginning after December 15, 2016. Early adoption is permitted. The adoption of ASU 2015-11 is not expected to have a material impact on the Company’s financial position or results of operations. Interest — imputation of interest - In April 2015, the FASB issued ASU No. 2015-03, “Interest — Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). The update requires that all costs incurred to issue debt be presented in the balance sheet as a direct deduction from the carrying value of the debt. In August 2015, the FASB issued ASU No. 2015-15, “Interest — Imputation of Interest, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line of Credit Arrangements, Amendments to SEC Paragraphs Pursuant to Staff Announcement at June 18, 2015 EITF Meeting” (“ASU 2015-15”), to clarify that an entity may elect to present debt issuance costs related to a line-of-credit arrangement as an asset, regardless of whether or not there are any outstanding borrowings on the line-of-credit arrangement. The ASU’s are effective for fiscal years, and interim periods, beginning after December 15, 2015. Early adoption is permitted. The adoptions of the ASU’s are not expected to have a material impact on the Company’s financial position or results of operations. Discontinued operations - In April 2014, the FASB issued ASU No. 2014-08, “Reporting discontinued operations and disclosure of disposals of components of an entity” (“ASU 2014-08”). The amended guidance requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations. The amendment also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. During the first quarter of fiscal 2015, the Company adopted ASU 2014-08. The adoption required additional disclosures regarding the Company’s discontinued operations, but did not impact the Company’s financial position or results of operations. Revenue recognition — In May 2014, the FASB issued ASU No. 2014-09, “Revenue from contracts with customers” (“ASU 2014-09”). The amended guidance outlines a single comprehensive revenue model for entities to use in accounting for revenue arising from contracts with customers. The guidance supersedes most current revenue recognition guidance, including industry-specific guidance. The core principle of the revenue model is that “an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” Entities have the option of using either a full retrospective or modified approach to adopt the guidance. In July 2015, the FASB provided a one-year delay in the effective date of ASU 2014-09, to be effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, and a permission to early adopt for interim and annual periods beginning after December 15, 2016. The Company is currently evaluating the impact of adopting ASU 2014-09.

NATURE OF BUSINESS AND BASIS 23

NATURE OF BUSINESS AND BASIS OF PRESENTATION (Policies)	9 Months Ended
	Nov. 01, 2015
NATURE OF BUSINESS AND BASIS OF PRESENTATION
Nature of Business	Nature of Business HD Supply Holdings, Inc. (“Holdings”) indirectly owns all of the outstanding common stock of HD Supply, Inc. (“HDS”). Holdings, together with its direct and indirect subsidiaries, including HDS (“HD Supply” or the “Company”), is one of the largest industrial distribution companies in North America. The Company specializes in three distinct market sectors: Maintenance, Repair & Operations; Infrastructure; and Specialty Construction. Through approximately 550 locations across 48 U.S. states and six Canadian provinces, the Company serves these markets with an integrated go-to-market strategy. HD Supply has approximately 14,000 associates delivering localized, customer-tailored products, services and expertise. The Company serves approximately 500,000 customers, which include contractors, maintenance professionals, home builders, industrial businesses, and government entities. HD Supply’s broad range of end-to-end product lines and services includes over 800,000 stock-keeping units (“SKUs”) of quality, name-brand and proprietary-brand products as well as value-add services supporting the entire life-cycle of a project from infrastructure and construction to maintenance, repair and operations. HD Supply is managed primarily on a product line basis and reports results of operations in three reportable segments. The reportable segments are Facilities Maintenance, Waterworks, and Construction & Industrial - White Cap. Other operating segments include Home Improvement Solutions, Interior Solutions, and HD Supply Canada. In addition, the consolidated financial statements include Corporate, which is comprised of enterprise-wide functional departments.
Basis of Presentation	Basis of Presentation In management’s opinion, the unaudited financial information for the interim periods presented includes all adjustments necessary for a fair statement of the results of operations, financial position, and cash flows. All adjustments are of a normal recurring nature unless otherwise disclosed. Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year. For a more complete discussion of the Company’s significant accounting policies and other information, you should read this report in conjunction with its annual report on Form 10-K, for the year ended February 1, 2015, which includes all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). Certain amounts in the prior-period financial statements have been reclassified to conform to the current period’s presentation.
Fiscal Year	F iscal Year HD Supply’s fiscal year is a 52- or 53-week period ending on the Sunday nearest to January 31. Fiscal years ending January 31, 2016 (“fiscal 2015”) and February 1, 2015 (“fiscal 2014”) both include 52 weeks. The three months ended November 1, 2015 (“third quarter 2015”) and November 2, 2014 (“third quarter 2014”) both include 13 weeks. The nine months ended November 1, 2015 and November 2, 2014 both include 39 weeks.
Principles of Consolidation	Principles of Consolidation The consolidated financial statements of HD Supply Holdings, Inc. present the results of operations, financial position and cash flows of HD Supply Holdings, Inc. and its wholly-owned subsidiaries, including HD Supply, Inc. The consolidated financial statements of HD Supply, Inc. present the results of operations, financial position and cash flows of HD Supply, Inc. and its wholly-owned subsidiaries. All material intercompany balances and transactions are eliminated. Results of operations of businesses acquired are included from their respective dates of acquisition. The results of operations of all discontinued operations have been separately reported as discontinued operations for all periods presented.
Estimates	Estimates Management has made a number of estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses in preparing these consolidated financial statements in conformity with GAAP. Actual results could differ from these estimates.
Self-Insurance	Self-Insurance HD Supply has a high deductible insurance program for most losses related to general liability, product liability, environmental liability, automobile liability, workers’ compensation, and is self-insured for medical claims and certain legal claims. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Self-insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. At November 1, 2015 and February 1, 2015, self-insurance reserves totaled approximately $90 million and $92 million, respectively.

DISCONTINUED OPERATIONS (Tables

DISCONTINUED OPERATIONS (Tables)	9 Months Ended
	Nov. 01, 2015
DISCONTINUED OPERATIONS
Result of Operations of Discontinued Operations	The following table provides additional detail related to the results of operations of the discontinued operations (amounts in millions): Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Net Sales $ $ $ $ Cost of sales Gross Profit Operating expenses: Selling, general and administrative Depreciation and amortization Restructuring — — — Total operating expenses Gain on sale of business — — Other (income) expense, net — — Income before provision for income taxes $ $ $ $ Provision (benefit) for income taxes Income from discontinued operations, net of tax $ $ $ $ At November 1, 2015 and February 1, 2015, the carrying amounts of major classes of assets and liabilities of discontinued operations included in the Consolidated Balance Sheets were as follows (amounts in millions): November 1, 2015 February 1, 2015 Current assets: Receivables, less allowance for doubtful accounts of $0 and $1 $ — $ Inventories — Other current assets — Total current assets — Goodwill — Intangible assets, net — Other non-current assets — Total assets of discontinued operations $ — $ Current liabilities: Accounts payable $ — $ Accrued compensation and benefits — Other current liabilities — Total liabilities of discontinued operations $ — $

DEBT (Tables)

DEBT (Tables)	9 Months Ended
	Nov. 01, 2015
Debt
Schedule of Long-term Debt	November 1, 2015 February 1, 2015 Outstanding Principal Interest Rate %(1) Outstanding Principal Interest Rate %(1) Senior ABL Facility due 2018 $ 30 1.70 $ 96 2.02 Term Loans due 2021, net of unamortized discount of $11 million and $14 million 839 3.75 961 4.00 December 2014 First Priority Notes due 2021 1,250 5.25 1,250 5.25 April 2012 Second Priority Notes due 2020 — — 675 11.00 October 2012 Senior Unsecured Notes due 2020 1,000 11.50 1,000 11.50 February 2013 Senior Unsecured Notes due 2020 1,275 7.50 1,275 7.50 Total long-term debt $ 4,394 $ 5,257 Less current installments (9 ) (34 ) Long-term debt, excluding current installments $ 4,385 $ 5,223 (1) Represents the stated rate of interest, without including the effect of discounts.
5.25% Senior Secured First Priority Notes due 2021
Debt
Notes Redemption	Year Percentage 2017 % 2018 % 2019 % 2020 and thereafter %
11.5% Senior Unsecured Notes due 2020
Debt
Notes Redemption	Year Percentage 2016 % 2017 % 2018 and thereafter %
7.5% Senior Unsecured Notes due 2020
Debt
Notes Redemption	Year Percentage 2016 % 2017 % 2018 and thereafter %

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	Nov. 01, 2015
FAIR VALUE MEASUREMENTS
Schedule of Financial Instruments that are Not Reflected at Fair Value on the Balance Sheet	As of November 1, 2015 As of February 1, 2015 Recorded Amount(1) Estimated Fair Value Recorded Amount(1) Estimated Fair Value Senior ABL Facility $ $ $ $ Term Loans and Notes Total $ $ $ $ (1) These amounts do not include accrued interest; accrued interest is classified as Other current liabilities in the accompanying Consolidated Balance Sheets. These amounts do not include any related discounts or premiums.

BASIC AND DILUTED WEIGHTED AV27

BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES (Tables)	9 Months Ended
	Nov. 01, 2015
BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES
Schedule of reconciliation of basic to diluted weighted average common shares	Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Weighted average common shares Effect of potentially dilutive securities: Stock plans Diluted weighted average common shares Stock plan securities excluded from dilution (1) (1) Represents securities not included in the computation of diluted earnings per share because their effect would have been anti-dilutive.

SUPPLEMENTAL BALANCE SHEET AN28

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION (Tables)	9 Months Ended
	Nov. 01, 2015
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION
Schedule of Receivables	November 1, 2015 February 1, 2015 Trade receivables, net of allowance for doubtful accounts $ $ Vendor rebate receivables Other receivables Total receivables, net $ $
Schedule of Other Current Liabilities	HD Supply Holdings, Inc. HD Supply, Inc. November 1, 2015 February 1, 2015 November 1, 2015 February 1, 2015 Accrued interest $ $ $ $ Accrued non-income taxes Other Total other current liabilities $ $ $ $

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	9 Months Ended
	Nov. 01, 2015
SEGMENT INFORMATION
Net Sales Adjusted Earning Before Interest, Taxes, Depreciation and Amortization and Other Measures for Reportable Segments and Total Continuing Operations	Facilities Maintenance Waterworks Construction & Industrial - White Cap Corporate & Other Total Continuing Operations Three Months Ended November 1, 2015 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization Three Months Ended November 2, 2014 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization — Nine Months Ended November 1, 2015 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization Nine Months Ended November 2, 2014 Net Sales $ $ $ $ $ Adjusted EBITDA ) Depreciation(1) & Software Amortization Other Intangible Amortization (1) Depreciation includes amounts recorded within Cost of sales in the Consolidated Statements of Operations and Comprehensive Income.
Reconciliation of Adjusted EBITDA to Income (Loss) from Continuing Operations	Three Months Ended Nine Months Ended November 1, 2015 November 2, 2014 November 1, 2015 November 2, 2014 Total Adjusted EBITDA $ $ $ $ Depreciation and amortization (1) Stock-based compensation Restructuring — Other ) — ) ) Operating income Interest expense, net Loss on extinguishment & modification of debt (2) — Other (income) expense, net (3) — ) ) Income from Continuing Operations Before Provision for Income Taxes Provision (benefit) for income taxes (4) ) Income from continuing operations Income from discontinued operations, net of tax Net Income $ $ $ $ (1) Depreciation and amortization includes amounts recorded within Cost of sales in the Consolidated Statements of Operations. (2) Represents the loss on extinguishment of debt including the premium paid to repurchase or call the debt as well as the write-off of unamortized deferred financing costs and other assets or liabilities associated with such debt. Also includes the costs of debt modification. (3) Represents the costs expensed in connection with secondary offerings of Holdings’ common stock by certain of Holdings’ stockholders. (4) During the nine months ended November 1, 2015, the Company recorded a reduction in unrecognized tax benefits as a result of IRS and state audit settlements. See “Note 6, Income Taxes” and “Note 10, Commitments and Contingencies” for discussion of the IRS audit settlement.

SUBSIDIARY GUARANTORS (Tables)

SUBSIDIARY GUARANTORS (Tables)	9 Months Ended
	Nov. 01, 2015
SUBSIDIARY GUARANTORS
Condensed Consolidating Statements of Operations and Comprehensive Income (Loss)	Three Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — — Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — — Restructuring Charge — — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net — — — — — Net (earnings) loss of equity affiliates ) — — — Income From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) — Income from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) — Net Income (Loss) $ $ $ ) $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment — ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Three Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative — Depreciation and amortization — Total operating expenses — Operating Income (Loss) ) ) Interest expense — ) Interest (income) ) ) — — Other (income) expense, net ) — — — ) Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) ) — Income (Loss) from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment ) — ) ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Nine Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — Restructuring charge — — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net — — — Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) — ) Income (Loss) from Continuing Operations ) Income from discontinued operations, net of tax — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment — ) Total Comprehensive Income (Loss) $ $ $ $ ) $ Nine Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non- Guarantor Subsidiaries Eliminations Total HDS Net Sales $ — $ $ $ ) $ Cost of sales — ) Gross Profit — ) Operating expenses: Selling, general and administrative ) Depreciation and amortization — Restructuring — — Total operating expenses ) Operating Income (Loss) ) — Interest expense — ) Interest (income) ) ) — — Loss on extinguishment & modification of debt — — — Other (income) expense, net ) — — — ) Net (earnings) loss of equity affiliates ) — — — Income (Loss) From Continuing Operations Before Provision (Benefit) for Income Taxes ) Provision (benefit) for income taxes ) ) — Income (Loss) from Continuing Operations ) Income (loss) from discontinued operations, net of tax ) ) — Net Income (Loss) $ $ $ $ ) $ Other comprehensive income (loss) — foreign currency translation adjustment ) — ) ) Total Comprehensive Income (Loss) $ $ $ $ ) $
Condensed Consolidating Balance Sheets	As of November 1, 2015 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS ASSETS Current assets: Cash and cash equivalents $ $ $ $ — $ Receivables, net — Inventories — — Deferred tax asset — ) Other current assets — Total current assets ) Property and equipment, net — Goodwill — — — Intangible assets, net — — Deferred tax asset — — — Investment in subsidiaries — — ) — Intercompany notes receivable — ) — Other assets — — Total assets $ $ $ $ ) $ LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) Current liabilities: Accounts payable $ $ $ $ — $ Accrued compensation and benefits — Current installments of long-term debt — — — Deferred tax liabilities — — ) — Other current liabilities — Total current liabilities ) Long-term debt, excluding current installments — — — Deferred tax liabilities — — Intercompany notes payable — ) — Other liabilities — Total liabilities ) Stockholder’s equity (deficit) ) ) ) Total liabilities and stockholder’s equity (deficit) $ $ $ $ ) $ As of February 1, 2015 Debt Issuer Guarantor Subsidiaries Non-Guarantor Subsidiaries Eliminations Total HDS ASSETS Current assets: Cash and cash equivalents $ $ $ $ — $ Receivables, net — Inventories — — Deferred tax asset — ) Current assets of discontinued operations — Other current assets — Total current assets ) Property and equipment, net — Goodwill — — Intangible assets, net — — Deferred tax asset — ) Non-current assets of discontinued operations — — Investment in subsidiaries — — ) — Intercompany notes receivable — ) — Other assets — — Total assets $ $ $ $ ) $ LIABILITIES AND STOCKHOLDER’S EQUITY (DEFICIT) Current liabilities: Accounts payable $ $ $ $ — $ Accrued compensation and benefits — Current installments of long-term debt — — — Deferred tax liabilities — — ) — Current liabilities of discontinued operations — — Other current liabilities — Total current liabilities ) Long-term debt, excluding current installments — — — Deferred tax liabilities — — ) Intercompany notes payable — ) — Other liabilities — Total liabilities ) Stockholder’s equity (deficit) ) ) ) Total liabilities and stockholder’s equity (deficit) $ $ $ $ ) $
Condensed Consolidating Cash Flow Statements	Nine Months Ended November 1, 2015 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS Net cash flows from operating activities $ $ $ $ — $ Cash flows from investing activities Capital expenditures ) ) — — ) Proceeds from sale of property and equipment — — — Proceeds from sale of a business — — — Investments in equity affiliates - Return of capital — — ) — Proceeds from (payments of) intercompany notes — — ) — Other investing activities — — — — — Net cash flows from investing activities ) — ) Cash flows from financing activities Equity contribution (return of capital) — ) ) — Borrowings from (repayments to) intercompany notes ) — — — Borrowings of long-term debt — — — Repayments of long-term debt ) — — — ) Borrowings on long-term revolver — — — Repayments on long-term revolver ) — — — ) Debt issuance and modification fees ) — — — ) Other financing activities — — — Net cash flows from financing activities ) ) ) ) Effect of exchange rates on cash — — ) — ) Net increase (decrease) in cash & cash equivalents $ $ ) $ ) $ — $ ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ — $ Nine Months Ended November 2, 2014 Debt Issuer Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total HDS Net cash flows from operating activities $ $ $ $ — $ Cash flows from investing activities Capital expenditures ) ) ) — ) Investments in equity affiliates - Return of capital — — ) — Proceeds from sale of property and equipment — — — Proceeds from (payments of) intercompany notes — — ) — Other investing activities — — ) — Net cash flows from investing activities ) ) ) ) Cash flows from financing activities Equity contribution (return of capital) — — ) — Borrowings (repayments) of intercompany notes ) — — — Borrowings of long-term debt — — — Repayments of long-term debt ) — — — ) Borrowings on long-term revolver — — — Repayments of long-term revolver ) — — — ) Debt issuance and modification fees ) — — — ) Other financing activities ) — — Net cash flows from financing activities ) — ) ) Effect of exchange rates on cash — — — — — Net increase (decrease) in cash & cash equivalents $ ) $ $ ) $ — $ ) Cash and cash equivalents at beginning of period — Cash and cash equivalents at end of period $ $ $ $ — $

NATURE OF BUSINESS AND BASIS 31

NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Nov. 01, 2015USD ($)locationitem	Nov. 02, 2014	Nov. 01, 2015USD ($)segmentproductlocationcustomeremployeeitem	Nov. 02, 2014	Jan. 31, 2016	Feb. 01, 2015USD ($)
Nature of Business and Accounting Policy disclosures
Number of distinct market sectors in which entity specializes | item	3		3
Number of operating locations	550		550
Number of associates | employee			14,000
Number of customer | customer			500,000
Reportable segment | segment			3
Length of current fiscal year (in days)	91 days	91 days	273 days	273 days		364 days
Self-insurance reserves | $	$ 90		$ 90			$ 92
Expected
Nature of Business and Accounting Policy disclosures
Length of current fiscal year (in days)					364 days
Minimum
Nature of Business and Accounting Policy disclosures
Number of SKUs offered | product			800,000
Length of fiscal year (in days)			364 days
Maximum
Nature of Business and Accounting Policy disclosures
Length of fiscal year (in days)			371 days
U.S.
Nature of Business and Accounting Policy disclosures
Number of states or provinces	48		48
Corporate & Other | Canada
Nature of Business and Accounting Policy disclosures
Number of states or provinces	6		6

PUBLIC OFFERINGS (Details)

PUBLIC OFFERINGS (Details) - Common stock - USD ($) $ / shares in Units, $ in Millions	Jul. 28, 2015	Nov. 02, 2014
Other income (expense)
Public Offerings
Stock offering expenses	$ 1	$ 2
July Selling Stockholders
Public Offerings
Stock sold by shareholders	30,539,550
Price per share (in dollars per share)	$ 35.44

DISCONTINUED OPERATIONS (Detail

DISCONTINUED OPERATIONS (Details) - USD ($) $ in Millions	Oct. 31, 2015	Jan. 31, 2015	Nov. 01, 2015	Nov. 01, 2015	Feb. 01, 2015
Discontinued operations disclosures
Cash received from sale of business				$ 810
Gain on sale of business			$ 186	186
Power Solutions
Discontinued operations disclosures
Cash received from sale of business	$ 810			$ 810
Gain on sale of business	186
Sale of issued and outstanding equity interests, transaction cost	15
Foreign Currency Translation Adjustment	$ 20
Hardware Solutions
Discontinued operations disclosures
Cash received from sale of business		$ 198
Gain on sale of business					$ 8
Sale of issued and outstanding equity interests, transaction cost		$ 2
Litemor
Discontinued operations disclosures
Gain on sale of business					$ (15)

DISCONTINUED OPERATIONS (Deta34

DISCONTINUED OPERATIONS (Details 2) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
Results of operations of the discontinued operations
Net Sales	$ 367	$ 574	$ 1,391	$ 1,686
Cost of sales	313	463	1,185	1,364
Gross Profit	54	111	206	322
Operating expenses:
Selling, general and administrative	39	77	155	245
Depreciation and amortization	5	10	18	32
Restructuring				1
Total operating expenses	44	87	173	278
Gain on sale of business	186		186
Other (income) expense, net	(3)		(3)
Income before provision for income taxes	193	24	216	44
Provision (benefit) for income taxes	(42)	4	(36)	8
Income (loss) from discontinued operations, net of tax	$ 235	$ 20	$ 252	$ 36

DISCONTINUED OPERATIONS (Deta35

DISCONTINUED OPERATIONS (Details 3) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Current assets:
Receivables, less allowance for doubtful accounts of $00 and $1		$ 221
Allowance for doubtful accounts	$ 0	1
Inventories		284
Other current assets		4
Total current assets		509
Goodwill		202
Intangible assets, net		55
Other non-current assets		38
Total assets of discontinued Operations		804
Current liabilities:
Accounts payable		178
Accrued compensation and benefits		18
Other current liabilities		21
Total liabilities of discontinued operations		$ 217

DISCONTINUED OPERATIONS (Deta36

DISCONTINUED OPERATIONS (Details 4) - USD ($) $ in Millions	Oct. 31, 2015	Nov. 01, 2015	Nov. 02, 2014
Net cash provided by operating activities and used in investing activities
Net cash provided by operating activities		$ 30	$ 101
Net cash used in investing activities		808	$ 16
Proceeds from Divestiture of Businesses		810
Power Solutions
Net cash provided by operating activities and used in investing activities
Proceeds from Divestiture of Businesses	$ 810	$ 810

DEBT (Details)

DEBT (Details) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Debt
Less current installments	$ (9)	$ (34)
Long-term debt, excluding current installments	4,385	5,223
HD Supply, Inc
Debt
Long-term Debt, Total	4,394	5,257
Less current installments	(9)	(34)
Long-term debt, excluding current installments	$ 4,385	5,223
HD Supply, Inc | 11% Senior Secured Second Priority Notes due 2020
Debt
Long-term Debt, Total		$ 675
Long Term Debt, Interest Rate	11.00%	11.00%
HD Supply, Inc | 11.5% Senior Unsecured Notes due 2020
Debt
Long-term Debt, Total	$ 1,000	$ 1,000
Long Term Debt, Interest Rate	11.50%	11.50%
HD Supply, Inc | 7.5% Senior Unsecured Notes due 2020
Debt
Long-term Debt, Total	$ 1,275	$ 1,275
Long Term Debt, Interest Rate	7.50%	7.50%
HD Supply, Inc | 5.25% Senior Secured First Priority Notes due 2021
Debt
Long-term Debt, Total	$ 1,250	$ 1,250
Long Term Debt, Interest Rate	5.25%	5.25%
HD Supply, Inc | Asset Based Lending Facility
Debt
Long-term Debt, Total	$ 30	$ 96
Long Term Debt, Interest Rate	1.70%	2.02%
HD Supply, Inc | Term loan due 2021
Debt
Long-term Debt, Total	$ 839	$ 961
Long Term Debt, Interest Rate	3.75%	4.00%
Unamortized discount	$ 11	$ 14

DEBT (Details 2)

DEBT (Details 2) - HD Supply, Inc $ in Millions	Oct. 13, 2015USD ($)	Aug. 13, 2015USD ($)	Aug. 12, 2015	Nov. 01, 2015USD ($)
Senior Secured Term Facility maturing in 2021
Debt
Line of credit facility, maximum borrowing capacity		$ 850
Amortization of debt, aggregate annual amounts as a percentage of original principal amount		1.00%
Prepayment premium (as a percent)		1
Modification and extinguishment charges		$ 20
Financing and other costs		5
Write-off of unamortized discount and deferred financing costs		$ 15
Senior Secured Term Facility maturing in 2021 | LIBOR
Debt
Percentage added to reference rate		2.75%
Interest rate floor		1.00%
Senior Secured Term Facility maturing in 2021 | Base
Debt
Percentage added to reference rate		1.75%
Term Loan Facility
Debt
Line of credit facility, maximum borrowing capacity				$ 850
Amortization of debt, aggregate annual amounts as a percentage of original principal amount				1.00%
Term Loan Facility | LIBOR
Debt
Percentage added to reference rate			3.00%	2.75%
Interest rate floor				1.00%
Term Loan Facility | Base
Debt
Percentage added to reference rate			2.00%	1.75%
11% Senior Secured Second Priority Notes due 2020
Debt
Debt redeemed	$ 675
Premium payment to redeem notes	72
Accrued but unpaid interest	37
Gains (losses) on extinguishment of debt	80
Unamortized deferred debt costs	$ 8

DEBT (Details 3)

DEBT (Details 3) - Asset Based Lending Facility - HD Supply, Inc $ in Millions	9 Months Ended
	Nov. 01, 2015USD ($)item
Debt
Line of credit facility, maximum borrowing capacity	$ 1,500
Line of credit facility, available for borrowing	1,225
Letter of credit facility outstanding	34
Line of credit facility, available for borrowing on qualifying cash balances	$ 44
The minimum number of incremental term loan facilities permitted to be included in the Senior ABL Facility | item	1
The minimum number of revolving credit facility commitments permitted to be included in the Senior ABL Facility | item	1

DEBT (Details 4)

DEBT (Details 4) - USD ($) $ in Millions	Aug. 12, 2015	Mar. 30, 2015	Nov. 01, 2015	Nov. 02, 2014
Debt
Excess cash flow provision, prepayment accepted			$ 1,150	$ 27
HD Supply, Inc
Debt
Excess cash flow provision, prepayment accepted			1,150	$ 27
Term Loan Facility | HD Supply, Inc
Debt
Line of credit facility, maximum borrowing capacity			$ 850
Amortization of debt, aggregate annual amounts as a percentage of original principal amount			1.00%
Excess cash flow provision, prepayment offered		$ 34
Excess cash flow provision, prepayment accepted		$ 16
Term Loan Facility | LIBOR | HD Supply, Inc
Debt
Interest rate floor			1.00%
Percentage added to reference rate	3.00%		2.75%
Term Loan Facility | Base | HD Supply, Inc
Debt
Percentage added to reference rate	2.00%		1.75%

DEBT (Details 5)

DEBT (Details 5) - 5.25% Senior Secured First Priority Notes due 2021 - HD Supply, Inc	9 Months Ended
	Nov. 01, 2015	Feb. 01, 2015
Debt
Note issued, interest rate	5.25%	5.25%
2,017
Debt
Optional prepayment price percentage	103.938%
2,018
Debt
Optional prepayment price percentage	102.625%
2,019
Debt
Optional prepayment price percentage	101.313%
2020 and thereafter
Debt
Optional prepayment price percentage	100.00%
Prior to December 15, 2017
Debt
Optional prepayment price percentage	100.00%
Percentage limit on amount that can be redeemed	40.00%
Prepayment percentage price as a percent of the principal, with proceeds from certain equity offerings	105.25%
Threshold percentage for debt that must remain after each redemption	50.00%

DEBT (Details 6)

DEBT (Details 6) - HD Supply, Inc	Nov. 01, 2015	Feb. 01, 2015
First Priority Notes due 2019
Debt
Collateral pledged, percentage outstanding capital of any foreign subsidiary	65.00%
11% Senior Secured Second Priority Notes due 2020
Debt
Note issued, interest rate	11.00%	11.00%

DEBT (Details 7)

DEBT (Details 7) - 11.5% Senior Unsecured Notes due 2020 - HD Supply, Inc	9 Months Ended
	Nov. 01, 2015	Feb. 01, 2015
Debt
Note issued, interest rate	11.50%	11.50%
Prior to October 15, 2016
Debt
Optional prepayment price percentage	100.00%
2,016
Debt
Optional prepayment price percentage	105.75%
2,017
Debt
Optional prepayment price percentage	102.875%
2018 and thereafter
Debt
Optional prepayment price percentage	100.00%

DEBT (Details 8)

DEBT (Details 8) - 7.5% Senior Unsecured Notes due 2020 - HD Supply, Inc	9 Months Ended
	Nov. 01, 2015	Feb. 01, 2015
Debt
Note issued, interest rate	7.50%	7.50%
Prior to October 15, 2016
Debt
Optional prepayment price percentage	100.00%
2,016
Debt
Optional prepayment price percentage	103.75%
2,017
Debt
Optional prepayment price percentage	101.875%
2018 and thereafter
Debt
Optional prepayment price percentage	100.00%

FAIR VALUE MEASUREMENTS (Detail

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Fair value measurements
Recorded Amount	$ 4,405	$ 5,271
Estimated Fair Value	4,682	5,599
Asset Based Lending Facility
Fair value measurements
Recorded Amount	30	96
Estimated Fair Value	30	95
Term Loans and Notes
Fair value measurements
Recorded Amount	4,375	5,175
Estimated Fair Value	$ 4,652	$ 5,504

INCOME TAXES (Details)

INCOME TAXES (Details) - USD ($) $ in Millions	Feb. 19, 2015	Nov. 01, 2015	Nov. 01, 2015	Feb. 01, 2015
INCOME TAXES
Combined federal, state and foreign effective tax rate for continuing operations (benefit)			80.00%
Increased (Decreased) income tax expense, impact of tax amortization of indefinite lived intangibles		$ 11	$ 26
Unrecognized tax benefits		8	8	$ 187
Unrecognized tax benefits, decrease resulting from state audit settlements	$ 189		179
Unrecognized tax benefits, net accrual for interest and penalties		1	1	29
Reduction in unrecognized tax benefits, maximum		1	1
Deferred tax assets, valuation allowance		$ 845	$ 845	$ 1,013

BASIC AND DILUTED WEIGHTED AV47

BASIC AND DILUTED WEIGHTED AVERAGE COMMON SHARES (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
Reconciliation of basic to diluted weighted average common shares
Weighted average common shares	197,529	194,288	196,589	193,806
Effect of potentially dilutive securities:
Stock plans	4,017	5,863	4,765	5,883
Diluted weighted average common shares	201,546	200,151	201,354	199,689
Stock plan securities excluded from dilution	49	50	719	429

SUPPLEMENTAL BALANCE SHEET AN48

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION (Details) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Receivables
Trade receivables, net of allowance for doubtful accounts	$ 1,001	$ 784
Vendor rebate receivables	77	75
Other receivables	14	9
Total receivables, net	$ 1,092	$ 868

SUPPLEMENTAL BALANCE SHEET AN49

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION (Details 2) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015
Other Current Liabilities
Accrued interest	$ 37	$ 98
Accrued non-income taxes	45	29
Other	106	103
Total other current liabilities	188	230
HD Supply, Inc
Other Current Liabilities
Accrued interest	37	98
Accrued non-income taxes	45	29
Other	104	103
Total other current liabilities	$ 186	$ 230

SUPPLEMENTAL BALANCE SHEET AN50

SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION (Details 3) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	9 Months Ended
	Nov. 01, 2015	Nov. 01, 2015	Nov. 02, 2014	Feb. 01, 2015
Supplemental Cash Flow Information
Cash paid for interest		$ 354	$ 426
Original issue discounts paid		12	1
Cash paid for income taxes, net of refunds		$ 14	$ 37
Significant Non-Cash Transactions
Retired common stock (in shares)	1,384,622	1,976,053
Retired common stock	$ 46	$ 63
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01		$ 0.01

RESTRUCTURING ACTIVITIES (Detai

RESTRUCTURING ACTIVITIES (Details) $ in Millions	9 Months Ended
	Nov. 01, 2015USD ($)
RESTRUCTURING ACTIVITIES
Payback period	2 years
Severance, relocation and other related costs
RESTRUCTURING ACTIVITIES
Costs incurred	$ 4
Severance, relocation and other related costs | Other Current Liabilities
RESTRUCTURING ACTIVITIES
Costs incurred	4
Severance, relocation and other related costs | Minimum
RESTRUCTURING ACTIVITIES
Expected costs	10
Severance, relocation and other related costs | Maximum
RESTRUCTURING ACTIVITIES
Expected costs	$ 20

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions	1 Months Ended	9 Months Ended	24 Months Ended
	Aug. 31, 2014	Nov. 01, 2015	Jan. 30, 2011	Jul. 31, 2014
Internal Revenue Service
Contingent increase in deferred tax asset before valuation allowance		$ 12
IRS
Internal Revenue Service
Tentative settlement amount				$ 27
Home Depot Incorporated
Internal Revenue Service
Amount paid in order to stop the accrual of interest on the Tentative Settlement amount	$ 27
Home Depot Incorporated | IRS
Internal Revenue Service
Cash refunds received			$ 354

COMMITMENTS AND CONTINGENCIES53

COMMITMENTS AND CONTINGENCIES (Details 2) - USD ($) $ in Thousands	Sep. 21, 2015	Aug. 11, 2015	Nov. 01, 2015
Legal Matters
Settlement amount		$ 4,945
Effective period	3 years
Estimated aggregate potential loss, minimum			$ 0
Estimated aggregate potential loss, maximum			$ 10,000

SEGMENT INFORMATION (Details)

SEGMENT INFORMATION (Details) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 01, 2015USD ($)location	Nov. 02, 2014USD ($)	Nov. 01, 2015USD ($)segmentlocation	Nov. 02, 2014USD ($)
Segment information
Number of reportable segments | segment			3
Net Sales	$ 2,012	$ 1,914	$ 5,740	$ 5,427
Adjusted EBITDA	265	230	711	620
Depreciation & Software Amortization	25	27	77	80
Other Intangible Amortization	4	21	11	76
Corporate & Other
Segment information
Net Sales	140	148	409	422
Adjusted EBITDA	(2)	(8)	(20)	(19)
Depreciation & Software Amortization	6	8	17	20
Other Intangible Amortization	$ 1		$ 4	3
Corporate & Other | Canada
Segment information
Number of provinces | location	6		6
Facilities Maintenance
Segment information
Net Sales	$ 716	660	$ 2,084	1,950
Adjusted EBITDA	149	139	427	387
Depreciation & Software Amortization	11	12	34	37
Other Intangible Amortization	1	16	4	56
Waterworks
Segment information
Net Sales	705	695	1,977	1,911
Adjusted EBITDA	70	64	181	162
Depreciation & Software Amortization	3	2	8	7
Other Intangible Amortization	1	1	2	3
Construction & Industrial - White Cap
Segment information
Net Sales	451	411	1,270	1,144
Adjusted EBITDA	48	35	123	90
Depreciation & Software Amortization	5	5	18	16
Other Intangible Amortization	$ 1	$ 4	$ 1	$ 14

SEGMENT INFORMATION (Details 2)

SEGMENT INFORMATION (Details 2) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
SEGMENT INFORMATION
Total Adjusted EBITDA	$ 265	$ 230	$ 711	$ 620
Depreciation and amortization (1)	29	48	88	156
Stock-based compensation	4	3	14	12
Restructuring	4		4	6
Other	(1)		(1)	(1)
Operating Income (Loss)	229	179	606	447
Interest expense, net	99	115	311	347
Loss on extinguishment & modification of debt	100		100	2
Other (income) expense, net		(4)	1	(3)
Income from Continuing Operations Before Provision for Income Taxes	30	68	194	101
Provision (benefit) for income taxes	15	28	(155)	41
Income from Continuing Operations	15	40	349	60
Income from discontinued operations, net of tax	235	20	252	36
Net Income (Loss)	$ 250	$ 60	$ 601	$ 96

SUBSIDIARY GUARANTORS (Details)

SUBSIDIARY GUARANTORS (Details)	9 Months Ended
	Nov. 01, 2015
Debt Issuer
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)
Period of notice to the applicable trustee to cause subsidiary guarantor to be released from subsidiary guarantee	30 days

SUBSIDIARY GUARANTORS (Details

SUBSIDIARY GUARANTORS (Details 2) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014	Nov. 01, 2015	Nov. 02, 2014
Condensed consolidating statements of operations and comprehensive income (loss)
Net Sales	$ 2,012	$ 1,914	$ 5,740	$ 5,427
Cost of sales	1,346	1,299	3,835	3,670
Gross Profit	666	615	1,905	1,757
Operating expenses:
Selling, general and administrative	405	390	1,211	1,152
Depreciation and amortization	28	46	84	152
Restructuring charges	4		4	6
Total operating expenses	437	436	1,299	1,310
Operating Income (Loss)	229	179	606	447
Interest expense	99	115	311	347
Loss on extinguishment & modification of debt	100		100	2
Income from Continuing Operations Before Provision for Income Taxes	30	68	194	101
Provision (benefit) for income taxes	15	28	(155)	41
Income from Continuing Operations	15	40	349	60
Income (loss) from discontinued operations, net of tax	235	20	252	36
Net Income (Loss)	250	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	18	(3)	16	(1)
Total Comprehensive Income (Loss)	268	57	617	95
Eliminations
Condensed consolidating statements of operations and comprehensive income (loss)
Net Sales	(1)	(2)	(2)	(2)
Cost of sales		(1)	(1)	(1)
Gross Profit	(1)	(1)	(1)	(1)
Operating expenses:
Selling, general and administrative	(1)		(1)	(1)
Total operating expenses	(1)		(1)	(1)
Operating Income (Loss)		(1)
Interest expense	(62)	(63)	(186)	(184)
Interest (income)	62	62	186	184
Net (earnings) loss of equity affiliates	343	105	493	234
Income from Continuing Operations Before Provision for Income Taxes	(343)	(105)	(493)	(234)
Income from Continuing Operations	(343)	(105)	(493)	(234)
Net Income (Loss)	(343)	(105)	(493)	(234)
Other comprehensive income (loss) - foreign currency translation adjustment	(18)	3	(16)	1
Total Comprehensive Income (Loss)	(361)	(102)	(509)	(233)
Debt Issuer | Reportable legal entity
Operating expenses:
Selling, general and administrative	17	20	60	53
Depreciation and amortization	4	3	11	12
Restructuring charges				1
Total operating expenses	21	23	71	66
Operating Income (Loss)	(21)	(23)	(71)	(66)
Interest expense	100	117	315	349
Interest (income)	(60)	(59)	(182)	(181)
Loss on extinguishment & modification of debt	100		100	2
Other (income) expense, net		(4)	1	(3)
Net (earnings) loss of equity affiliates	(343)	(105)	(493)	(234)
Income from Continuing Operations Before Provision for Income Taxes	182	28	188	1
Provision (benefit) for income taxes	157	(33)	(188)	(101)
Income from Continuing Operations	25	61	376	102
Income (loss) from discontinued operations, net of tax	225	(1)	225	(6)
Net Income (Loss)	250	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	18	(3)	16	(1)
Total Comprehensive Income (Loss)	268	57	617	95
Subsidiaries Guarantor | Reportable legal entity
Condensed consolidating statements of operations and comprehensive income (loss)
Net Sales	1,982	1,881	5,648	5,329
Cost of sales	1,330	1,282	3,786	3,616
Gross Profit	652	599	1,862	1,713
Operating expenses:
Selling, general and administrative	378	356	1,118	1,061
Depreciation and amortization	24	42	72	139
Restructuring charges	4		4	5
Total operating expenses	406	398	1,194	1,205
Operating Income (Loss)	246	201	668	508
Interest expense	61	61	182	182
Interest (income)	(2)	(3)	(4)	(3)
Income from Continuing Operations Before Provision for Income Taxes	187	143	490	329
Provision (benefit) for income taxes	(145)	62	29	143
Income from Continuing Operations	332	81	461	186
Income (loss) from discontinued operations, net of tax	13	19	22	44
Net Income (Loss)	345	100	483	230
Total Comprehensive Income (Loss)	345	100	483	230
Non-Guarantor Subsidiaries | Reportable legal entity
Condensed consolidating statements of operations and comprehensive income (loss)
Net Sales	31	35	94	100
Cost of sales	16	18	50	55
Gross Profit	15	17	44	45
Operating expenses:
Selling, general and administrative	11	14	34	39
Depreciation and amortization		1	1	1
Total operating expenses	11	15	35	40
Operating Income (Loss)	4	2	9	5
Income from Continuing Operations Before Provision for Income Taxes	4	2	9	5
Provision (benefit) for income taxes	3	(1)	4	(1)
Income from Continuing Operations	1	3	5	6
Income (loss) from discontinued operations, net of tax	(3)	2	5	(2)
Net Income (Loss)	(2)	5	10	4
Other comprehensive income (loss) - foreign currency translation adjustment	18	(3)	16	(1)
Total Comprehensive Income (Loss)	16	2	26	3
HD Supply, Inc
Condensed consolidating statements of operations and comprehensive income (loss)
Net Sales	2,012	1,914	5,740	5,427
Cost of sales	1,346	1,299	3,835	3,670
Gross Profit	666	615	1,905	1,757
Operating expenses:
Selling, general and administrative	405	390	1,211	1,152
Depreciation and amortization	28	46	84	152
Restructuring charges	4		4	6
Total operating expenses	437	436	1,299	1,310
Operating Income (Loss)	229	179	606	447
Interest expense	99	115	311	347
Loss on extinguishment & modification of debt	100		100	2
Other (income) expense, net		(4)	1	(3)
Income from Continuing Operations Before Provision for Income Taxes	30	68	194	101
Provision (benefit) for income taxes	15	28	(155)	41
Income from Continuing Operations	15	40	349	60
Income (loss) from discontinued operations, net of tax	235	20	252	36
Net Income (Loss)	250	60	601	96
Other comprehensive income (loss) - foreign currency translation adjustment	18	(3)	16	(1)
Total Comprehensive Income (Loss)	$ 268	$ 57	$ 617	$ 95

SUBSIDIARY GUARANTORS (Detail58

SUBSIDIARY GUARANTORS (Details 3) - USD ($) $ in Millions	Nov. 01, 2015	Feb. 01, 2015	Nov. 02, 2014	Feb. 02, 2014
Current assets:
Cash and cash equivalents	$ 77	$ 85	$ 107	$ 115
Receivables, net	1,092	868
Inventories	868	784
Deferred tax asset	4	9
Current assets of discontinued operations		509
Other current assets	37	43
Total current assets	2,078	2,298
Property and equipment, net	327	340
Goodwill	2,869	2,869
Intangible assets, net	134	145
Non-current assets of discontinued operations		295
Total assets	5,486	6,060
Current liabilities:
Accounts payable	651	510
Accrued compensation and benefits	129	144
Current installments of long-term debt	9	34
Current liabilities of discontinued operations		217
Other current liabilities	188	230
Total current liabilities	977	1,135
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	142	166
Other liabilities	108	296
Total liabilities	5,612	6,820
Stockholder's equity (deficit)	(126)	(760)
Total liabilities and stockholders' equity (deficit)	5,486	6,060
Eliminations
Current assets:
Deferred tax asset	(55)	(59)
Total current assets	(55)	(59)
Deferred tax asset		(8)
Investment in subsidiaries	(2,740)	(3,216)
Intercompany notes receivable	(2,786)	(2,802)
Total assets	(5,581)	(6,085)
Current liabilities:
Deferred tax liabilities	(55)	(59)
Total current liabilities	(55)	(59)
Deferred tax liabilities		(8)
Intercompany notes payable	(2,786)	(2,802)
Total liabilities	(2,841)	(2,869)
Stockholder's equity (deficit)	(2,740)	(3,216)
Total liabilities and stockholders' equity (deficit)	(5,581)	(6,085)
Debt Issuer | Reportable legal entity
Current assets:
Cash and cash equivalents	43	28	45	53
Receivables, net	4	1
Other current assets	11	12
Total current assets	58	41
Property and equipment, net	48	55
Deferred tax asset		8
Investment in subsidiaries	2,740	3,216
Intercompany notes receivable	2,192	2,191
Other assets	74	109
Total assets	5,112	5,620
Current liabilities:
Accounts payable	10	14
Accrued compensation and benefits	38	50
Current installments of long-term debt	9	34
Deferred tax liabilities	55	59
Other current liabilities	57	124
Total current liabilities	169	281
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	13
Intercompany notes payable	594	611
Other liabilities	79	265
Total liabilities	5,240	6,380
Stockholder's equity (deficit)	(128)	(760)
Total liabilities and stockholders' equity (deficit)	5,112	5,620
Subsidiaries Guarantor | Reportable legal entity
Current assets:
Cash and cash equivalents	18	25	21	17
Receivables, net	1,069	851
Inventories	848	767
Deferred tax asset	57	66
Current assets of discontinued operations		455
Other current assets	25	29
Total current assets	2,017	2,193
Property and equipment, net	276	283
Goodwill	2,869	2,868
Intangible assets, net	132	143
Non-current assets of discontinued operations		288
Intercompany notes receivable	594	611
Other assets	3	3
Total assets	5,891	6,389
Current liabilities:
Accounts payable	627	485
Accrued compensation and benefits	89	90
Current liabilities of discontinued operations		200
Other current liabilities	120	97
Total current liabilities	836	872
Deferred tax liabilities	129	174
Intercompany notes payable	2,192	2,191
Other liabilities	26	26
Total liabilities	3,183	3,263
Stockholder's equity (deficit)	2,708	3,126
Total liabilities and stockholders' equity (deficit)	5,891	6,389
Non-Guarantor Subsidiaries | Reportable legal entity
Current assets:
Cash and cash equivalents	12	32	37	41
Receivables, net	19	16
Inventories	20	17
Deferred tax asset	2	2
Current assets of discontinued operations		54
Other current assets	1	2
Total current assets	54	123
Property and equipment, net	3	2
Goodwill		1
Intangible assets, net	2	2
Deferred tax asset	1	1
Non-current assets of discontinued operations		7
Total assets	60	136
Current liabilities:
Accounts payable	14	11
Accrued compensation and benefits	2	4
Current liabilities of discontinued operations		17
Other current liabilities	9	9
Total current liabilities	25	41
Other liabilities	3	5
Total liabilities	28	46
Stockholder's equity (deficit)	32	90
Total liabilities and stockholders' equity (deficit)	60	136
HD Supply, Inc
Current assets:
Cash and cash equivalents	73	85	$ 103	$ 111
Receivables, net	1,092	868
Inventories	868	784
Deferred tax asset	4	9
Current assets of discontinued operations		509
Other current assets	37	43
Total current assets	2,074	2,298
Property and equipment, net	327	340
Goodwill	2,869	2,869
Intangible assets, net	134	145
Deferred tax asset	1	1
Non-current assets of discontinued operations		295
Other assets	77	112
Total assets	5,482	6,060
Current liabilities:
Accounts payable	651	510
Accrued compensation and benefits	129	144
Current installments of long-term debt	9	34
Current liabilities of discontinued operations		217
Other current liabilities	186	230
Total current liabilities	975	1,135
Long-term debt, excluding current installments	4,385	5,223
Deferred tax liabilities	142	166
Other liabilities	108	296
Total liabilities	5,610	6,820
Stockholder's equity (deficit)	(128)	(760)
Total liabilities and stockholders' equity (deficit)	$ 5,482	$ 6,060

SUBSIDIARY GUARANTORS (Detail59

SUBSIDIARY GUARANTORS (Details 4) - USD ($) $ in Millions	9 Months Ended
	Nov. 01, 2015	Nov. 02, 2014
Condensed consolidating cash flow statements
Net cash flows from operating activities	$ 173	$ 121
Cash flows from investing activities
Capital expenditures	(61)	(92)
Proceeds from sale of business, net	810
Proceeds from sale of property and equipment	2	3
Net cash provided by (used in) investing activities	751	(89)
Cash flows from financing activities
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver	784	524
Repayments of long-term revolver	(850)	(554)
Debt issuance and modification fees	(6)	(3)
Other financing activities	1
Net cash provided by (used in) financing activities	(930)	(40)
Effect of exchange rates on cash	(2)
Increase (decrease) in cash and cash equivalents	(8)	(8)
Cash and cash equivalents at beginning of period	85	115
Cash and cash equivalents at end of period	77	107
Eliminations
Cash flows from investing activities
Investments in equity affiliates-Return of capital	(34)	(27)
Proceeds from (payments of) intercompany notes	(16)	(25)
Other investing activities		(1)
Net cash provided by (used in) investing activities	(50)	(53)
Cash flows from financing activities
Equity contribution (return of capital)	34	27
Borrowings from (repayments to) intercompany notes	16	25
Other financing activities		1
Net cash provided by (used in) financing activities	50	53
Debt Issuer | Reportable legal entity
Condensed consolidating cash flow statements
Net cash flows from operating activities	130	41
Cash flows from investing activities
Capital expenditures	(9)	(11)
Proceeds from sale of business, net	810
Investments in equity affiliates-Return of capital	34	27
Other investing activities		1
Net cash provided by (used in) investing activities	835	17
Cash flows from financing activities
Borrowings from (repayments to) intercompany notes	(16)	(25)
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver	784	524
Repayments of long-term revolver	(850)	(554)
Debt issuance and modification fees	(6)	(3)
Other financing activities	1	(1)
Net cash provided by (used in) financing activities	(950)	(66)
Increase (decrease) in cash and cash equivalents	15	(8)
Cash and cash equivalents at beginning of period	28	53
Cash and cash equivalents at end of period	43	45
Subsidiaries Guarantor | Reportable legal entity
Condensed consolidating cash flow statements
Net cash flows from operating activities	29	55
Cash flows from investing activities
Capital expenditures	(52)	(79)
Proceeds from sale of property and equipment	2	3
Proceeds from (payments of) intercompany notes	16	25
Net cash provided by (used in) investing activities	(34)	(51)
Cash flows from financing activities
Equity contribution (return of capital)	(2)
Net cash provided by (used in) financing activities	(2)
Increase (decrease) in cash and cash equivalents	(7)	4
Cash and cash equivalents at beginning of period	25	17
Cash and cash equivalents at end of period	18	21
Non-Guarantor Subsidiaries | Reportable legal entity
Condensed consolidating cash flow statements
Net cash flows from operating activities	14	25
Cash flows from investing activities
Capital expenditures		(2)
Net cash provided by (used in) investing activities		(2)
Cash flows from financing activities
Equity contribution (return of capital)	(32)	(27)
Net cash provided by (used in) financing activities	(32)	(27)
Effect of exchange rates on cash	(2)
Increase (decrease) in cash and cash equivalents	(20)	(4)
Cash and cash equivalents at beginning of period	32	41
Cash and cash equivalents at end of period	12	37
HD Supply, Inc
Condensed consolidating cash flow statements
Net cash flows from operating activities	173	121
Cash flows from investing activities
Capital expenditures	(61)	(92)
Proceeds from sale of business, net	810
Proceeds from sale of property and equipment	2	3
Net cash provided by (used in) investing activities	751	(89)
Cash flows from financing activities
Borrowings of long-term debt	287	20
Repayments of long-term debt	(1,150)	(27)
Borrowings on long-term revolver	784	524
Repayments of long-term revolver	(850)	(554)
Debt issuance and modification fees	(6)	(3)
Other financing activities	1
Net cash provided by (used in) financing activities	(934)	(40)
Effect of exchange rates on cash	(2)
Increase (decrease) in cash and cash equivalents	(12)	(8)
Cash and cash equivalents at beginning of period	85	111
Cash and cash equivalents at end of period	$ 73	$ 103