HD Supply Holdings reported net sales of $2 billion for the second quarter of fiscal 2015 ended August 2, 2015, an increase of $126 million, or 6.7 percent, as compared to Q2 2014.
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The company believes its sales performance represents growth of approximately 300 - 400 basis points in excess of its market growth estimate.
Gross profit increased $54 million, or 8.8 percent, to $665 million for the second quarter of fiscal 2015 compared to $611 million for the second quarter of fiscal 2014. Gross profit was 33.2 percent of Net sales for the second quarter of fiscal 2015, up approximately 70 basis points from 32.5 percent of Net sales for the second quarter of fiscal 2014.
Despite a challenging environment, the company saw improvement in gross margin as a percentage of Net sales driven by our category management initiatives and favorable product and services mix.
Operating income increased $59 million, or 36.2 percent, to $222 million for the second quarter of fiscal 2015 compared to $163 million for the second quarter of fiscal 2014.
Operating income as a percentage of Net sales increased approximately 240 basis points during the second quarter of fiscal 2015 as compared to the second quarter of fiscal 2014. The improvement in operating income as a percentage of Net sales is a result of gross margin expansion, cost productivity initiatives and the company's ability to leverage fixed costs.
Adjusted EBITDA increased $34 million, or 15.2 percent, to $258 million for the second quarter of fiscal 2015 compared to $224 million for the second quarter of fiscal 2014.
Adjusted EBITDA as a percentage of net sales increased approximately 100 basis points to 12.9 percent in the second quarter of fiscal 2015 as compared to 11.9 percent in the second quarter of fiscal 2014.
The increase in Adjusted EBITDA was driven by a combination of gross margin expansion and solid cost discipline.
Net income for the second quarter of fiscal 2015 increased $61 million or 127.1 percent to $109 million for the second quarter of fiscal 2015 compared to $48 million for the second quarter of fiscal 2014.
Net income per diluted share increased $0.30 or 125.6 percent to $0.54 for the second quarter of fiscal 2015 compared to $0.24 in the second quarter of fiscal 2014.
Adjusted net income increased $42 million to $113 million for the second quarter of fiscal 2015 as compared to an Adjusted net income of $71 million for the second quarter of fiscal 2014. Adjusted net income per diluted share was $0.56 in the second quarter of fiscal 2015, as compared to $0.35 in the second quarter of fiscal 2014.
The increase in Adjusted net income is primarily attributable to sales growth, improved margins, a reduction in interest expense and a favorable tax position.
As of August 2, 2015, HD Supply's combined liquidity of approximately $1,451 million was comprised of $169 million in Cash and cash equivalents and $1,282 million of additional available borrowings under our Senior ABL Facility, based on qualifying inventory and receivables. ■