Home Depot hit with $850M coronavirus-related charge

Home Depot prioritized safety and enhanced employee benefits

Get all the latest news on coronavirus and more delivered daily to your inbox.  Sign up here.

Continue Reading Below

Home Depot Inc.'s first-quarter profit slid 11 percent from a year ago as the company emphasized coronavirus safety measures and enhanced employee benefits.

The Atlanta-based home-improvement chain closed stores early beginning in mid-March to allow more time for sanitization and restocking essential products amid the COVID-19 pandemic and expanded paid time off and weekly bonuses. The improvements for associates resulted in a pre-tax charge of $850 million, or 60 cents a share after taxes.

HERE ARE THE TOP HOME DEPOT SHOPPING HACKS

Net income dropped to $2.2 billion, or $2.08 a share, as revenue rose 7.1 percent from a year ago to $28.26 billion. Wall Street analysts were anticipating adjusted earnings of $2.27 a share on revenue of $27.54 billion.

TickerSecurityLastChangeChange %
HDTHE HOME DEPOT INC.247.29-1.19-0.48%

“We took early and decisive action to intentionally limit customer traffic in our stores, which we believe had a significant impact to sales in many markets,” said CEO Craig Menear. “Even with these actions, the robust and flexible interconnected infrastructure that we have invested in for over a decade allowed us to quickly adapt to changing customer preferences and achieve strong sales performance in the quarter.”

WHAT ARE HOME DEPOT'S TOP PINNED PRODUCTS?

Sales at stores open at least a year, an industry performance benchmark, rose 6.4 percent from the previous year and were up 7.5 percent in the U.S. An 11 percent jump to $74.70 in the average sales ticket helped make up for a 3.9 percent drop in the number of transactions. Sales per square foot rose 7.2 percent to $466.58.

Home Depot declared a quarterly dividend of $1.50 a share. The company withdrew its 2020 outlook due to uncertainty caused by the pandemic.

CLICK HERE TO READ MORE ON FOX BUSINESS

Home Depot shares rose 12 percent this year through Monday, outperforming the S&P 500's 8.57 percent decline.