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Office Depot Fourth Quarter Misses Estimate

Friday February 22nd, 2013 - 10:31AM


For the fiscal year ended December 29, Office Depot posted a net loss after preferred stock dividends of $110 million, or 39 cents per share, versus $60 million, or 22 cents per share, in the year earlier. Adjusted for charges, net earnings after preferred stock dividends would have been $9 million, or three cents per share, for fiscal 2012, the company said in a statement.

Adjusted for charges and certain tax benefits, the 2011 net loss after preferred stock dividends was $8 million, or three cents per share, Office Depot stated.

In 2012, sales were $10.7 billion, a decrease of 7% from the prior year or 4% when the impact of a 53rd week in fiscal 2011 is excluded, according to the company.

Fourth quarter sales were $2.6 billion, down 12% versus the 2011 period, the company noted. On a constant currency basis, fourth quarter sales were down 11% versus prior year. The 53rd week added approximately $140 million of sales in the fourth quarter of 2011. Excluding the benefit of the additional selling week in 2011, 2012 fourth quarter sales on a constant currency sales would have been down 7%, the company reported.

Office Depot reported a net loss, after preferred stock dividends, of $17 million, or six cents per diluted share, in the fourth quarter versus net earnings, after preferred stock dividends, of $12 million, or four cents per share, in the fourth quarter of 2011.

Fourth quarter 2012 results included approximately $12 million of pre-tax charges primarily related to restructuring activities and actions to improve future operating performance, Office Depot said, and about $9 million related to non-cash asset impairment charges in the company’s North American Retail Division.

Excluding the charges, fourth quarter net earnings, after preferred stock dividends, would have been $1 million, or zero cents per share, it related.

The result came in three cents short of a Zacks consensus analyst estimate.

The 2011 fourth results included $23 million of pre-tax charges primarily related to restructuring activities and actions to improve future operating performance, Office Depot added. Results for the period also included a $24 million tax benefit related to the reversal of an uncertain tax position accrual and the release of a valuation allowance, the company stated. Excluding the charges and tax benefits, 2011 fourth quarter net earnings, after preferred stock dividends, would have been $8 million, or three cents per share, the company said.

“We delivered the financial results we had projected for the fourth quarter of 2012,” Neil Austrian, Office Depot chairman and CEO, said. “Despite continued revenue pressure in North American Retail and International, we successfully executed our key initiatives.”