Home Depot CEO: Housing decline may be nearing end

ATLANTA (Reuters) - Home Depot Inc's (HD.N) chief executive said a battered U.S. housing market was nearing the bottom of its decline, but the home-improvement sector would remain under pressure at least through early 2009.

"We don't think we're at the bottom yet, but we think you can see it from here," Frank Blake told a Goldman Sachs retail conference on Wednesday, that was available by webcast.

Blake made similar remarks about the U.S. housing market in late July.

"We're planning on the market remaining under pressure certainly through the rest of this year and probably into the beginning part of 2009," Blake added.

He said Home Depot could see "very modest" improvement in the second half of this year as sales and earnings comparisons get easier. But he added that margins would face continued pressure through the rest of 2008.

Home Depot shares were up 97 cents, or 3.5 percent, at $29.04 in morning New York Stock Exchange trading. Rival Lowe's Cos (LOW.N) gained 52 cents, or 2 percent, to $26.85.

Home Depot, the world's largest home-improvement chain, has said full-year profit could drop about 24 percent this year. Its quarterly earnings have declined for eight straight quarters in the wake of the slumping U.S. housing market.

As falling home sales and values have depressed Home Depot's sales, it has coped by closing unprofitable stores and cut jobs in areas such as human resources.

Though higher fuel prices were raising transportation costs, Home Depot merchandising Executive Vice President Craig Menear said prices of some commodities were showing signs of stabilizing.

"We're starting to see things like lumber stabilize, we're beginning to see copper really holding about where it was last year," Menear said.

(Reporting by Karen Jacobs, editing by Maureen Bavdek)