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Home Depot Q1 Beats Weather, Wall Street

For the first quarter ended May 5, The Home Depot today reported net earnings of $1.2 billion, or 83 cents per diluted share, versus $1 billion, or 68 cents per diluted share, in the fiscal 2012 period. Comparable store sales increased 4.3% versus last year’s quarter.

A Thomson Reuters consensus analyst estimate called for earnings of 77 cents per share in the first quarter.

Overall sales in the quarter were $19.1 billion, up 7.4% from last year’s period, according to Home Depot. Due to a 14th week in 2012’s final fiscal period, Home Depot’s first quarter sales benefited from a seasonal timing change that added approximately $574 million to the total, the retailer pointed out.

Frank Blake, Home Depot chairman and CEO, in a conference call, said that seasonal sales took a hit in the quarter, given unusual weather conditions in much of the northern United States. However, he said, core interior businesses were strong and the professional business had outstripped growth on the consumer end, supporting the idea that Home Depot is benefiting from an improving housing market.

Among the departments that posted better sales, standouts included home décor, lighting, kitchen, lumber, tools, plumbing electrical, bath and hardware, the company noted in the conference call. Lighting also has seen strong growth as more consumers adopt LED illumination, the retailer maintained.

In the first quarter, Home Depot simplified the checkout process online and launched ship to store among other web improvements, and, Blake noted, e-commerce site traffic gained almost 50% while mobile traffic doubled.

“In the first quarter, we saw less favorable weather compared to last year, but we continue to see benefit from a recovering housing market that drove a stronger-than-expected start to the year for our business,” Blake stated in comments on the results.