Home Depot 2007 Annual Report Download - page 20

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Environmental.
The Home Depot is committed to conducting business in an environmentally responsible manner and this commitment
impacts all areas of our business, including store construction and maintenance, energy usage, product selection and customer education. In
fiscal 2007, we budgeted approximately $50 million for energy efficiency related projects. By replacing HVAC units in approximately 200
existing stores and switching to the use of T-5 lighting in approximately 600 existing stores, we estimate savings to be approximately
$20 million since fiscal 2006. In addition, we have implemented strict operational standards that establish energy efficient practices in all of our
facilities. These include HVAC unit temperature regulation and adherence to strict lighting schedules, which are the largest sources of energy
consumption in our stores, as well as implementation of the Novar Energy Management and Alarm System in each store to monitor energy
efficiency. We estimate that by implementing these energy saving programs we have avoided 907 million pounds of greenhouse gas emissions.
We believe this is equivalent to removing approximately 75,000 cars from the highway.
We have also taken additional measures to further our sustainability efforts. We partnered with the U.S. Green Building Council and have built
five LEED green certified stores. We offset the carbon emissions created by our facilities and a portion of those emissions created by business
related travel through an agreement with The Conservation Fund that resulted in the planting of thousands of trees that will help reduce the heat-
island effect in urban areas, reduce erosion and help clean the air. Through our Eco Options
SM
Program, we have created product categories that
allow consumers to easily identify environmentally preferred product selections in our stores. We implemented a Supplier Social and
Environmental Responsibility Program to ensure that our suppliers adhere to the highest standards of social and environmental responsibility.
Seasonality.
Our business is seasonal to a certain extent. Generally, our highest volume of sales occurs in our second fiscal quarter and the
lowest volume occurs during our fourth fiscal quarter.
Competition. Our business is highly competitive, based in part on price, store location, customer service and assortment of merchandise. In
each of the markets we serve, there are a number of other home improvement stores, electrical, plumbing and building materials supply houses
and lumber yards. With respect to some products, we also compete with discount stores, local, regional and national hardware stores, mail order
firms, warehouse clubs, independent building supply stores and, to a lesser extent, other retailers. In addition to these entities, our EXPO Design
Center stores compete with specialty design stores or showrooms, some of which are only open to interior design professionals. Due to the
variety of competition we face, we are unable to precisely measure the impact on our sales by our competitors.
Item 1A. Risk Factors.
The risks and uncertainties described below could materially and adversely affect our business, financial condition and results of operations and
could cause actual results to differ materially from our expectations and projections. While we believe that our assumptions, expectations and
projections are reasonable in view of currently available information, you are cautioned not to place undue reliance on forward-looking
statements. These statements are not guarantees of future performance. They are subject to future events, risks and uncertainties –
many of which
are beyond our control or are unknown to us – as well as potentially inaccurate assumptions that could cause actual results to differ materially
from our expectations and projections. You should read these Risk Factors in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in Item 7 and our Consolidated Financial Statements and related notes in Item 8. There also may
be other factors that we cannot anticipate or that are not described in this report, generally because we do not perceive them to be material. Such
factors could cause results to differ materially from our expectations.
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