Home Depot 2014 Annual Report Download - page 59

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54
known and will record an estimate for losses at the time or times when it is both probable that a loss has been incurred and
the amount of the loss is reasonably estimable. The Company believes that the ultimate amount paid on these actions, claims
and investigations could be material to the Company’s consolidated financial condition, results of operations, or cash flows in
future periods.
Future Costs
The Company expects to incur significant legal and other professional services expenses associated with the Data Breach in
future periods. The Company will recognize these expenses as services are received. Costs related to the Data Breach that
may be incurred in future periods may also include liabilities to payment card networks for reimbursements of credit card
fraud and card reissuance costs; liabilities related to the Company’s private label credit card fraud and card reissuance costs;
liabilities from current and future civil litigation, governmental investigations and enforcement proceedings; future expenses
for legal, investigative and consulting fees; and incremental expenses and capital investments for remediation activities. The
Company believes that the ultimate amount paid on these services and claims could be material to the Company’s
consolidated financial condition, results of operations, or cash flows in future periods.
Insurance Coverage
The Company maintained $100 million of network security and privacy liability insurance coverage in fiscal 2014, above a
$7.5 million deductible, to limit the Company's exposure to losses such as those related to the Data Breach. As of February 1,
2015, the Company had received an initial payment of $10 million of insurance reimbursements, and expects to receive
additional payments. In fiscal 2015, the Company entered into a new policy, with $100 million of network security and
privacy liability insurance coverage, above a $10 million deductible, to limit the Company's exposure to similar losses.
14. QUARTERLY FINANCIAL DATA (UNAUDITED)
The following is a summary of the quarterly consolidated results of operations for the fiscal years ended February 1, 2015
and February 2, 2014 (amounts in millions, except per share data):
Net Sales Gross
Profit Net
Earnings
Basic
Earnings per
Share
Diluted
Earnings per
Share
Fiscal Year Ended February 1, 2015:
First Quarter $ 19,687 $ 6,885 $ 1,379 $ 1.01 $ 1.00
Second Quarter 23,811 8,161 2,050 1.52 1.52
Third Quarter 20,516 7,185 1,537 1.16 1.15
Fourth Quarter 19,162 6,723 1,379 1.06 1.05
Fiscal Year $ 83,176 $ 28,954 $ 6,345 $ 4.74 $ 4.71
Fiscal Year Ended February 2, 2014:
First Quarter $ 19,124 $ 6,679 $ 1,226 $ 0.84 $ 0.83
Second Quarter 22,522 7,721 1,795 1.25 1.24
Third Quarter 19,470 6,798 1,351 0.96 0.95
Fourth Quarter 17,696 6,192 1,013 0.73 0.73
Fiscal Year $ 78,812 $ 27,390 $ 5,385 $ 3.78 $ 3.76
Note: The quarterly data may not sum to fiscal year totals.