Home Depot 2000 Annual Report Download

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The Home Depot Annual Report 2000
listening

Table of contents

  • Page 1
    listening The Home Depot Annual Report 2000

  • Page 2
    ... industry. Working together, they will take this great Company to new heights in customer service, market growth and stockholder value. Arthur M. Blank Co-Chairman of the Board Bernard Marcus Co-Chairman of the Board Corporate Profile Founded in 1978, The Home Depot® is the world's largest home...

  • Page 3
    ... every day. Those ideas have led to exciting new products for the do-it-yourselfer, new programs for our professional and installation services customers, and great new retailing concepts like our EXPO Design Center stores. Throughout this report, we recognize listening and responding as the keys to...

  • Page 4
    ... with our customers. They operate in a boundary-less environment, where excitement and new ideas are part of the fabric of our Company. They are backed by terrific support from Home Depot's vendors and service partners and the strongest balance sheet in retailing. Our long-term stockholders also...

  • Page 5
    ..., Home Depot's introduction of major appliances in fiscal 2000 added substantial sales and profits, while offering our customers a complete kitchen or laundry project package. With incremental support from product line expansion, advertising and training, we expect to double this business during...

  • Page 6
    ..., the unique Home Depot culture and values must be passed on to an increasing number of diverse orange-aproned associates. Therefore, we are committed to enhancing training throughout the organization and developing more focused accountability in clearly defined business units. Sharing ideas through...

  • Page 7
    ... data 2000 increase 19.0% 19.9% 10.9% 11.3% 10.0% 1999 increase 1998 increase Net sales Gross profit Earnings before income taxes Net earnings Diluted earnings per share $ 45,738 13,681 4,217 2,581 1.10 $ 38,434 11,411 3,804 2,320 1.00 27.2% 32.6% 43.3% 43.7% 40.8% $ 30,219 8,605 2,654...

  • Page 8
    ... has been a Home Depot associate for Nine months. He works in the décor department in Paramus, New Jersey. "I enjoy interacting with customers, understanding the needs they really have. In my career I've run my own business, so I understand why it's important to be detail-oriented. To me, time...

  • Page 9
    ... in our stores this year shifts product receiving to the night hours. The resulting efficiencies free up associates to dedicate their time to serving customers. As a result, our stores are easier to shop, the shelves are fully stocked and the aisles are cleaner. prices at The home depot. 06 07

  • Page 10
    ... average purchase and shopping frequency, the pro customer is a great source of consistent growth, building sales and margin in existing markets. Computer-savvy pros in selected markets can also use our new Internet service to fulfill ordering, delivery and billing from the job site or an office...

  • Page 11
    ... are key to the pro business. Service is the most important part of the relationship. Contractors are always asking questions. We advise, walk them back to the product, and help them get back to their job sites quickly. We get their sales and loyalty because we earn their confidence every day." 08...

  • Page 12
    ...the product installation market and a significant opportunity to continue to grow at a rapid rate. BIY sales are supported by new product introductions, like our line of ThomasvilleTM cabinets. Our appliance program offers General Electric® and Maytag® products through every Home Depot store, with...

  • Page 13
    ... been a Home Depot associate for 16 years. She works in the kitchen installation and décor departments as an expediter in atlanta, Georgia. "Expediting is a very personal part of the business. In my role, you deal with so many people, from vendors to installers to customers. These customers have...

  • Page 14
    ...> > Chris Pepple has been a Home Depot associate for five and one-half years and works in the lighting department at the EXPO Design Center in Union, New Jersey. "At EXPO we have everything you need for room remodeling. You don't have to go to five different stores to get it done. In fact, there...

  • Page 15
    ... 2001, EXPO Design Center is the fastest-growing new concept for The Home Depot. EXPO Design Center stores opened to standing room only crowds in New Jersey, Boston, San Francisco, Chicago and New York during fiscal 2000, and will create excitement in Denver, St. Louis and other new markets during...

  • Page 16
    ... like Leslee Gooding are working with Reuben and hundreds of YouthBuild students across the country to prepare them for careers in the home improvement industry. As Reuben put it, "This is the best thing that could have happened to me." helping others doesn't end at the four walls of the store.

  • Page 17
    ... months of training, Leslee took her new-found skills, diploma and self-confidence to Home Depot, applying for a job with a Home Depot store manager who strongly supported the Casa Verde program. Today, Leslee is a valued member of The Home Depot team, giving back part of her time and experience to...

  • Page 18
    ... Selling and Store Operating Pre-Opening General and Administrative Total Operating Expenses Operating Income Interest Income (Expense): Interest and Investment Income Interest Expense Interest, net Earnings Before Income Taxes Income Taxes Net Earnings Selected Sales Data (2) Number of Transactions...

  • Page 19
    .... Pre-opening expenses averaged $671,000 per store in fiscal 2000 compared to $643,000 per store in fiscal 1999. The higher average expense was primarily due to the opening of more EXPO Design Center stores and expansion of Home Depot stores into certain new markets including international locations...

  • Page 20
    ... provide for substantial residual value guarantees and include purchase options at original cost on each property. The Company financed a portion of its new stores opened from fiscal 1997 through fiscal 2000, as well as office buildings in fiscal 1999 and 2000, under the operating lease agreements.

  • Page 21
    ... equivalents. Management believes that its current cash position, internally generated funds, funds available from its $1 billion commercial paper program and the ability to obtain alternate sources of financing should enable the Company to complete its capital expenditure programs, including store...

  • Page 22
    ... The Home Depot, Inc. and Subsidiaries amounts in millions, except per share data Fiscal Year Ended January 28, 2001 January 30, 2000 January 31, 1999 Net Sales Cost of Merchandise Sold Gross Profit Operating Expenses: Selling and Store Operating Pre-Opening General and Administrative Total...

  • Page 23
    ... Home Depot, Inc. and Subsidiaries amounts in millions, except share data January 28, 2001 January 30, 2000 Assets Current Assets: Cash and Cash Equivalents Short-Term Investments, including current maturities of long-term investments Receivables, net Merchandise Inventories Other Current Assets...

  • Page 24
    ... Income Other Total Stockholders' Equity Comprehensive Income(1) Balance, February 1, 1998 Shares Issued Under Employee Stock Purchase and Option Plans Tax Effect of Sale of Option Shares by Employees Net Earnings Translation Adjustments Cash Dividends ($0.077 per share) Comprehensive Income...

  • Page 25
    ..., 1999 and 1998, respectively Purchase of Remaining Interest in The Home Depot Canada Payments for Businesses Acquired, net Proceeds from Sales of Property and Equipment Purchases of Investments Proceeds from Maturities of Investments Advances Secured by Real Estate, net Net Cash Used in Investing...

  • Page 26
    ... purchased with a maturity of three months or less to be cash equivalents. The Company's cash and cash equivalents are carried at fair market value and consist primarily of commercial paper, money market funds, U.S. government agency securities and tax-exempt notes and bonds. Merchandise Inventories...

  • Page 27
    ... loss on the sale of land and buildings, the book value of abandoned fixtures, equipment and leasehold improvements and a provision for the present value of future lease obligations, less estimated sub-lease income. Stock Compensation Statement of Financial Accounting Standards No. 123 ("SFAS...

  • Page 28
    ... of commercial paper borrowings approximates their carrying value. The estimated fair value of all other long-term borrowings, excluding capital lease obligations, was approximately $67 million compared to the carrying value of $65 million. These fair values were estimated using a discounted cash...

  • Page 29
    ... to selected associates, officers and directors of the Company. The maximum number of shares of the Company's common stock available for issuance under the 1997 Plan is the lesser of 225 million shares or the number of shares carried over from prior plans plus one-half percent of the total number of...

  • Page 30
    ... stores opened from fiscal 1997 through 2000, as well as office buildings in fiscal 1999 and 2000, under the operating lease agreements. Under both agreements, the lessor purchases the properties, pays for the construction costs and subsequently leases the facilities to the Company. The lease term...

  • Page 31
    ... compensation limits under the Internal Revenue Code. The Company funds the 401(k) Restoration Plan through contributions made to a "rabbi trust," which are then used to purchase shares of the Company's common stock in the open market. Compensation expense related to this plan for fiscal years 2000...

  • Page 32
    ... the first quarter of fiscal 1998, the Company purchased, for $261 million, the remaining 25% partnership interest in The Home Depot Canada held by The Molson Companies. The excess purchase price over the estimated fair value of net assets of $117 million as of the acquisition date was recorded as...

  • Page 33
    ... to associates its policies for conducting business affairs in a lawful and ethical manner. The financial statements of the Company have been audited by KPMG LLP , independent auditors. Their accompanying report is based upon an audit conducted in accordance with auditing standards generally...

  • Page 34
    ...taxes - % of sales(2) Net earnings - % of sales(2) Balance Sheet Data and Financial Ratios Total assets Working capital Merchandise inventories Net property and equipment Long-term debt Stockholders' equity Book value per share ($) Long-term debt to equity (%) Current ratio Inventory turnover Return...

  • Page 35
    The Home Depot, Inc. and Subsidiaries 1999 1998 1997 1996(1) 1995 1994 1993 1992...$ $ $ $ $ $ (4)Excludes (5)Adjusted Apex Supply Company, Georgia Lighting, Maintenance Warehouse, and National Blinds and Wallpaper. to reflect the first 52 weeks of the 53-week fiscal year in 1996. 32 33

  • Page 36
    ... Officer, The Home Depot, Inc. M. Faye Wilson 6 Senior Vice President - Risk Management, The Home Depot, Inc. >> > > > > > > > > > > > > > > > Committee membership: 1 Executive 2 Audit 3 Stock option 4 Compensation 5 Nominating and corporate governance 6 Human resources...

  • Page 37
    ... Lawrence A. Smith Executive Services Steven O. Smith Merchandising - EXPO Design Center Richard L. Sullivan Marketing Carol B. Tomé Finance and Accounting Kenneth W. Ubertino Merchandising M. Faye Wilson Risk Management Robert J. Wittman Business Development - Villager's Hardware senior...

  • Page 38
    ...at the Store Support Center, or access the Company's Web site. Quarterly Stock Price Range First Quarter Second Quarter Third Quarter Fourth Quarter KPMG LLP Suite 2000 303 Peachtree Street, NE Atlanta, GA 30308 Stock Exchange Listing New York Stock Exchange Trading Symbol - HD Annual Meeting The...

  • Page 39
    ... and handle inventory, we are able to enhance the shopping environment, offer better customer service and improve efficiency. The Home Depot associates on our cover include store associates, store managers and district managers who successfully launched our SPI program in the Atlanta market in...

  • Page 40
    The Home Depot 2455 Paces Ferry Road, NW Atlanta, GA 30339-4024 USA 770-433-8211 www.homedepot.com