Staples Q3 Sales And Income Slip

For its third quarter, Staples posted net income of $198 million versus $217 million in the period a year earlier, and earnings per diluted share of 31 cents versus 34 cents in the 2014 quarter. Adjusted earnings were $226 million, or 35 cents per diluted share, versus $236 million, or 37 cents per diluted share, in the year-prior quarter.

Adjusted diluted earnings per share matched a Zacks Investment Research analyst average estimate.

Total company sales were $5.59 billion versus $5.96 billion in the 2014 quarter. Operating income in the quarter was $318 million compared with $328 million while adjusted operating income was $358 million versus $369 million in the year-ago period.

Adjusted figures compensate for costs related to the ongoing Office Depot acquisition process and restructuring activities, the company stated.

In the North American division, third quarter operating income was $201 million versus $218 million in the 2014 period while comparable store sales declined by 2%, Staples reported. Comparable sales, including store and online revenues with adjustment for currency exchange rate fluctuation, also declined by 2%.

Overall North American online sales decreased by 2% but increased 1% when adjusted for currency exchange rate fluctuation, the company noted. According to Staples, total sales in the North American division were $2.61 billion versus $2.83 billion in last year’s quarter.

“We’re driving solid sales and earnings growth in our North American commercial business, and stabilizing results in North American stores and online,” said Ron Sargent, Staples’ chairman and CEO. “Our strategic reinvention is on track, and we look forward to accelerating the transformation of Staples with the acquisition of Office Depot.”