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A record Q4. Here's how Depot did it.

3/6/2018

Sales exceeded expectations at the Home Depot in the fourth quarter of 2017. Sales increased to $23.9 billion, as domestic comps hit positive 7.2%.


During the company’s earnings call, Ted Decker, executive VP of merchandising, described sales as strong throughout the store, with a little extra strength from the pro customer and online sales. The latter continued their pace of double-digit growth, he said. A breakdown of performance department by department is here:


• Double-digit comps: lumber, electrical and tools enjoyed double-digit comps in the quarter.


• Higher than average comps: Appliances, plumbing, building materials.


• Lower than average, but positive: Décor, flooring, millwork, paint, indoor garden, hardware, outdoor garden, and kitchen and bath


Only one category was tagged with a negative comp – lighting. According to Decker, the reason is primarily due to LED price deflation.


According to Decker, sales to pro customers grew double-digits in the fourth quarter. “Pro-heavy categories such as lumber, pressure treated decking, insulation, and gypsum all had double-digit growth during the quarter with solid unit productivity,” he said.


Decker pointed to localized assortments in the hardscapes category as example of “balancing the art and science of retail,” he said. “We are leveraging the power of our clustering and space optimization tools to assign assortments and facings at a local store level.” So far, it seems to be working, he added.


Looking ahead, Decker shared with analysts a pair of specific products for which the retailer has high hopes. These were the Klein Tools new 9-inch Journeyman Diagonal-Cutting Pliers and the Hampton Bay patio furniture collection with CushionGuard technology, which he says guarantees water repellency, as well as protection from fading and stains.


Also from the company's fourth quarter results:


• Sales per square foot were $394.87, up 7.8%


• Big ticket sales ($900 plus) were up 9.8%


• Transactions for tickets under $50 increased 0.8%


• Average ticket was $64, up from $60.55.


• Comp average ticket increased 5.5%


• Comp transactions increased 1.9%


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