HD Supply Posts Profit In Q2, Results Beat Estimates - Update

(RTTNews) - Industrial and construction distributor HD Supply Holdings, Inc. (HDS) Tuesday reported profit for the second quarter compared with a loss last year, reflecting higher revenues and lower interest expense. Adjusted earnings, as well as revenues beat analysts' expectations. The shares rose about 6 percent in pre-market trading.

For the second quarter ended August 3, 2014, the company posted net income of $48 million or $0.24 per share, compared with a loss of $72 million or $0.47 per share in the prior year.

Excluding certain items, adjusted earnings for the recent quarter totaled $0.51 per share, while the company posted $0.23 in the second quarter of fiscal 2013.

On average, 15 analysts polled by Thomson Reuters expected the company to report profit per share of $0.47 for the quarter. Analysts' estimates typically exclude special items.

Quarterly sales grew 9 percent to $2.45 billion from $2.24 billion a year ago. Analysts expected revenue of $2.41 billion for the quarter.

Joe DeAngelo, CEO of the company said, "We delivered strong organic sales and earnings growth and remain cautiously optimistic about what seems to be improving end markets."

In Facilities Maintenance unit, net sales increased 8 percent, sales were up 11 percent in Waterworks unit, and Power Solutions showed a sales growth of 7 percent from last year. Net sales from Construction & Industrial - White Cap climbed 16 percent from the preceding year.

The company noted that its preliminary net sales in August were $785 million, and average daily sales were up 10.1 percent compared to the previous year.

Interest expenses for the quarter fell to $116 million from $145 million last year. Loss on extinguishment & modification of debt in the prior year was $46 million.

Looking ahead, for the third quarter, the company expects adjusted earnings per share in the range of $0.48 to $0.55, on revenues of $2.425 billion to $2.50 billion. Analysts project earnings per share of $0.52, on revenue of $2.45 billion for the quarter.

HDS closed Monday's regular trading at $27.39, down 0.83 percent. In the pre-market activity on Tuesday, the shares are up 5.81 percent.