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Sector analysts have said that unusually cold
and wet weather in several U.S. states, which delayed the onset
of spring and kept many Americans indoors, were likely to have
hurt first-quarter sales of Home Depot's gardening-related
products.
While the unfavorable weather has led contractors to delay
housing projects and prevented do-it-yourself customers from
working outdoors, land and labor shortages have also hurt lumber
demand.
In its first quarter results release, the company said only that
bad weather in February had depressed results. It was due to
hold a call with analysts later on Tuesday.
"We were pleased with the underlying performance of the core
business despite unfavorable weather in February and significant
deflation in lumber prices compared to a year ago," Chief
Executive Officer Craig Menear said in the results statement.
Lumber futures have fallen 28.6% since their 2019 highs in early
February. The commodity made up nearly 8% of Home Depot's sales
in the last fiscal year.
Same-store sales at the home improvement chain rose 2.5% in the
quarter ended May 5 and missed expectations of a 4.2% increase,
according to IBES data from Refinitiv.
The company's net income rose to $2.51 billion, or $2.27 per
share, from $2.4 billion, or $2.08 per share, a year earlier.
Analysts were expecting earnings of $2.18 per share.
Net sales rose 5.7% to $26.38 billion, beating analyst average
estimate of $26.36 billion.
The company's shares were marginally lower in pre-market
trading.
(Reporting by Uday Sampath in Bengaluru; Editing by Arun Koyyur)
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