ATLANTA – Home Depot Inc. (HD), the world's largest home improvement retailer, Thursday said it sees earnings and sales rising in fiscal 2005 but below a 2004 rate of growth it now says will be higher than it previously forecast.
The company, which is holding its analyst meeting in Atlanta, said it expects earnings per share to grow 10 percent to 14 percent in the next fiscal year, as sales rise 9 percent to 12 percent. Fiscal 2005 ends in early 2006.
For fiscal 2004, Home Depot said it now expects per-share profit to rise 20 percent to $2.26 as sales grow 12.5 percent. The retailer initially forecast 2004 profit growth of 10 percent to 14 percent
expect profit of $2.27 a share for the 2004 year and $2.58 a share for 2005, according to Reuters Estimates.
The retailer expects to open 175 stores over the next year, and said it would focus global expansion on Canada, Mexico and China.
Home Depot said it would keep modernizing older stores and upgrading its technology in an effort to improve customer service. The company will add appliances made by South Korea's LG Electronics (search) to its lineup, joining products by Maytag Corp. (MYG) and General Electric (GE).
"It's a major coup for LG," said Alan Wolf, senior editor at TWICE magazine, which tracks the electronics and appliance markets.
"Home Depot needed to diversify its brand offering, and LG provides a very unique product line that will differentiate it from (its main competitor) Lowe's," Wolf said.
Home Depot also said it would expand its services business that installs windows and other products, and said it would increase its business in the professional residential and commercial markets.
Home Depot's shares were down 35 cents to $41.85 on the New York Stock Exchange (search), while rival Lowe's Cos. (LOW) was off 1.2 percent, or 68 cents, to $56.70.
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox