Home Depot 2009 Annual Report Download - page 29

Interest and Other, net, reflects a $163 million charge to write-down our investment in HD Supply. Excluding
this charge, Interest and Other, net, as a percent of Net Sales was 0.9% for fiscal 2008.
Provision for Income Taxes
Our combined effective income tax rate for continuing operations decreased to 35.6% for fiscal 2008 from
36.4% for fiscal 2007. The decrease in our effective income tax rate for fiscal 2008 reflects lower state and
foreign effective tax rates.
Diluted Earnings per Share from Continuing Operations
Diluted Earnings per Share from Continuing Operations were $1.37 for fiscal 2008 and $2.27 for fiscal 2007.
Excluding the Rationalization Charges and the write-down of our investment in HD Supply, Diluted Earnings
per Share from Continuing Operations for fiscal 2008 were $1.78, a decrease of 21.6% from fiscal 2007. The
53rd week in fiscal 2007 increased Diluted Earnings per Share from Continuing Operations by approximately
$0.04 for fiscal 2007.
Diluted Earnings per Share from Continuing Operations were favorably impacted by the repurchase of shares of
our common stock. We repurchased 2.4 million shares for $70 million in fiscal 2008 and 293 million shares for
$10.8 billion in fiscal 2007.
Discontinued Operations
On August 30, 2007, the Company closed the sale of HD Supply. Discontinued operations for fiscal 2008
consist of a loss of $52 million, net of tax, or $0.03 per diluted share, related to the settlement of working
capital matters arising from the sale of HD Supply. Discontinued operations for fiscal 2007 consist of the
results of operations for HD Supply through August 30, 2007 and a $4 million loss on the sale of HD Supply.
Net Sales from discontinued operations were $7.4 billion for fiscal 2007 and Earnings from Discontinued
Operations, net of tax, were $185 million for fiscal 2007.
Liquidity and Capital Resources
Cash flow generated from operations provides us with a significant source of liquidity. For fiscal 2009, Net
Cash Provided by Operating Activities was $5.1 billion compared to $5.5 billion for fiscal 2008. This change
was a result of lower earnings excluding noncash impairment charges and reduced cash flows from working
capital items.
Net Cash Used in Investing Activities for fiscal 2009 was $755 million compared to $1.7 billion for fiscal 2008.
This decrease was primarily the result of $881 million less in Capital Expenditures in fiscal 2009 compared to
fiscal 2008.
In fiscal 2009, we spent $966 million on Capital Expenditures, allocated as follows: 26% for merchandising and
operations, 19% for maintenance, 19% for core technology, 15% for new stores and 21% for other initiatives. In
fiscal 2009, we added 13 new stores.
Net Cash Used in Financing Activities for fiscal 2009 was $3.5 billion compared with $3.7 billion for fiscal
2008. This decrease was primarily due to repayments in fiscal 2008 of $1.7 billion of short-term commercial
paper and $282 million of structured financing debt compared to $1.8 billion in Repayments of Long-Term
Debt in fiscal 2009.
We repurchased 7.7 million shares of our common stock for $213 million in fiscal 2009 and 2.4 million shares
for $70 million in fiscal 2008. Since the inception of our share repurchase program in 2002, we have
repurchased 753.6 million shares of our common stock for a total of $27.5 billion. As of January 31, 2010,
$12.5 billion remained under our share repurchase authorization.
We have commercial paper programs that allow for borrowings up to $3.25 billion. In connection with the
programs, we have a back-up credit facility with a consortium of banks for borrowings up to $3.25 billion. As
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