Home Depot INC
The Home Depot
2008 Annual Report
Dear Shareholders:
In 2008, our retail sales declined by 7.8 percent, with comp sales down 8.7 percent.
Our adjusted earnings per share from continuing operations declined 22 percent. In ordinary times, these would be very disappointing results. But 2008 was not an ordinary year.
Despite the difficult economic environment, we continued to improve our retail business, through investing in our associates and our stores, rebuilding our supply chain and improving customer service. We also made several strategic decisions to optimize our capital allocation, concentrating our efforts on our core business.
In the first quarter, we closed 15 underperforming stores and reduced our pipeline of new stores by 50. In the third quarter, we renegotiated our private label credit card agreement, capping our cost of private label credit. In the fourth quarter, we announced our decision to exit EXPO and related businesses. These actions will make the Company stronger.
On the financial side, we ended the year with a solid operating profit and $41 billion in assets. We generated cash from the business of approximately $5.5 billion, which allowed us to invest in the business where necessary and reduce our debt obligations while maintaining a healthy dividend.
On the operational side, we implemented an “Aprons on the Floor” initiative, which deployed over $200 million in annualized savings onto the floor of the stores for customer service. Our customer service levels, as measured by our Voice of
Customer surveys and other external sources, continue to improve.
We launched our “New Lower Price” campaign in the fall and have been very pleased with the customer response to this program. More than ever, our customers expect great value and exciting products in our stores, and we are committed to providing for these expectations.
We started the roll-out of our enhanced supply chain. At the end of January, we opened our fifth
2008 Annual Report
Dear Shareholders:
In 2008, our retail sales declined by 7.8 percent, with comp sales down 8.7 percent.
Our adjusted earnings per share from continuing operations declined 22 percent. In ordinary times, these would be very disappointing results. But 2008 was not an ordinary year.
Despite the difficult economic environment, we continued to improve our retail business, through investing in our associates and our stores, rebuilding our supply chain and improving customer service. We also made several strategic decisions to optimize our capital allocation, concentrating our efforts on our core business.
In the first quarter, we closed 15 underperforming stores and reduced our pipeline of new stores by 50. In the third quarter, we renegotiated our private label credit card agreement, capping our cost of private label credit. In the fourth quarter, we announced our decision to exit EXPO and related businesses. These actions will make the Company stronger.
On the financial side, we ended the year with a solid operating profit and $41 billion in assets. We generated cash from the business of approximately $5.5 billion, which allowed us to invest in the business where necessary and reduce our debt obligations while maintaining a healthy dividend.
On the operational side, we implemented an “Aprons on the Floor” initiative, which deployed over $200 million in annualized savings onto the floor of the stores for customer service. Our customer service levels, as measured by our Voice of
Customer surveys and other external sources, continue to improve.
We launched our “New Lower Price” campaign in the fall and have been very pleased with the customer response to this program. More than ever, our customers expect great value and exciting products in our stores, and we are committed to providing for these expectations.
We started the roll-out of our enhanced supply chain. At the end of January, we opened our fifth