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<< Previous   of   Next >>   ADVERTISEMENT   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Wednesday, May 21, 2008 Home Depot's profit drops 66 percent Associated Press ATLANTA -- The Home Depot Inc. doesn't know if stimulus checks making their way to potential customers are enough to improve its fortunes this year, the company said Tuesday as it reported a 66 percent drop in first-quarter profit. The world's largest home-improvement store chain did not give detailed guidance for the remainder of fiscal 2008, saying only that it was "more comfortable" with the low end of its previous expectations. Its shares fell $1.50, or 5.2 percent, to $27.37. The challenge for Home Depot, like its smaller rival Lowe's Cos., is a slumping U.S. housing market. Seventy percent of Home Depot sales come from homeowners, while the other 30 percent come from professionals such as contractors, according to the company. Eighty-nine percent of its stores are in the U.S., where home foreclosures are accelerating around the country. Home Depot's bottom line reflects the concern of many Americans about the declining value of homes and the rising cost of filling up a gas tank. Fewer people are putting money into their homes and Home Depot is selling fewer appliances, special-order kitchens and other big-ticket items. Mooresville, N.C.-based Lowe's reported Monday a nearly 18 percent drop in first-quarter earnings. Lowe's lowered its guidance for the year. "We certainly see -- on the general market side -- more risks than opportunities through the remainder of the year," Home Depot Chief Executive Frank Blake told analysts during a conference call Tuesday. Its first-quarter earnings results, excluding a charge related to previously announced store closings and the shrinking of future store growth plans, beat Wall Street expectations despite a decline in overall sales and sales at stores open at least a year. The Atlanta-based company said it earned $356 million, or 21 cents a share, in the three months ending May 4, compared with a profit of $1.05 billion, or 53 cents a share, a year earlier. Excluding the one-time charge, Home Depot said it earned $697 million, or 41 cents a share.

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