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Dour Housing Market Slams Home Depot Q4 Results

Profits drop 27%, and the company says 2008 isn't looking very bright

By Jim O'Neill,  Newser User

Posted Feb 26, 2008 8:23 AM CST
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(Newser) – Continuing US housing market woes, showing no signs of letting up, helped drag Home Depot’s fourth quarter profits down 27% over the same quarter last year, to $671 million from $925 million. The world’s largest home-improvement retailer also predicted fiscal-year earnings will drop 19% to 24%, more than twice the decline analysts had expected, the Wall Street Journal reports.

Revenue inched 1.5% higher, aided by an extra week of sales, to $17.66 billion. Without the extra week, sales actually declined nearly 5% in the fourth quarter. Analysts expected revenue to hit $18.02 billion. Full-year sales dropped to $77.35 billion from $79.02 billion in 2006. The company said it will open 55 stores in 2008, about half its norm.

A customer leaves the Home Depot design center store in Charlotte, N.C., Tuesday, Nov. 13, 2007. The Home Depot Inc. reported a 26.8 percent drop in third-quarter profits Tuesday, Nov. 13, 2007 as the deteriorating housing market put a crimp on home renovations. (AP Photo/Chuck Burton)
A customer leaves the Home Depot design center store in Charlotte, N.C., Tuesday, Nov. 13, 2007. The Home Depot Inc. reported a 26.8 percent drop in third-quarter profits Tuesday, Nov. 13, 2007 as the...   (Associated Press)
The Home Depot store is shown in this Aug. 13, 2007 file photo in North Miami, Fla. The Home Depot Inc. has tentatively agreed to sell its wholesale distribution business to a group of private equity firms for $8.5 billion, or $1.8 billion less than originally planned, a...
The Home Depot store is shown in this Aug. 13, 2007 file photo in North Miami, Fla. The Home Depot Inc. has tentatively agreed to sell its wholesale distribution business to a group of private equity...   (Associated Press)
Clouds rise over the Home Depot store in Williston, Vt., Monday, Aug. 13, 2007. The Home Depot Inc., the world's largest home improvement store chain, reported a 27% drop in fourth-quarter revenue.
Clouds rise over the Home Depot store in Williston, Vt., Monday, Aug. 13, 2007. The Home Depot Inc., the world's largest home improvement store chain, reported a 27% drop in fourth-quarter revenue.   (Associated Press)
Shopping carts are shown at the Home Depot store, Monday, Aug. 13, 2007 in North Miami, Fla. The Home Depot Inc., the world's largest home improvement store chain, reported Tuesday, Aug. 14, 2007 a 14.8 percent drop in second-quarter profit as sales slid, particularly at stores open at least...
Shopping carts are shown at the Home Depot store, Monday, Aug. 13, 2007 in North Miami, Fla. The Home Depot Inc., the world's largest home improvement store chain, reported Tuesday, Aug. 14, 2007 a 14.8...   (Associated Press)
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home improvement • housing market • construction • corporate earnings • Home Depot • Robert Nardelli • Lowe's • retail sales • housing crisis

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