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Home Depot Q1 EPS jumps 24.6% YOY despite slow start to spring selling

Atlanta-based home improvement retailer Home Depot Inc. on May 15 reported fiscal first-quarter diluted earnings that exceeded analysts' expectations as net sales increased despite a slow start to spring selling.

Diluted EPS for the three months ended April 29 climbed 24.6% year over year to $2.08 from $1.67. The S&P Capital IQ mean consensus estimate for GAAP EPS was $2.05.

Net income excluding exceptional items gained 19.4% to $2.40 billion from $2.01 billion.

Net sales rose 4.4% year over year to $24.95 billion from $23.89 billion. Comparable sales grew 4.2% year over year globally and 3.9% year over year in the U.S.

"We are pleased by the strength of our business despite a slow start to the spring selling season," said Chairman and CEO Craig Menear was quoted as saying in a statement. "Outside of our seasonal business, we had solid results in all markets and categories and are seeing strong momentum in all lines of business during these first few weeks of May."

Home Depot reaffirmed its projection for full-year diluted EPS of $9.31, which would constitute a 28% year-over-year increase if achieved. The company expects sales to grow 6.7% for the year, with comparable sales up 5.0%.

The company said its guidance figures include the impact of ASU No. 2014-09, pertaining to revenue recognition, which it adopted during the first fiscal quarter 2018. Under this accounting standard, Home Depot changed its method of presenting certain expenses and cost reimbursements related to its private-label credit card program, gift cards and gift card breakage income.