http://www.twice.com/article/366787-Office_Depot_Reports_413M_Q3_Loss.php
OFFICE-DEPOT Q3 LOSS OF $413M
Boca
Raton, Fla. – Office Depot reported a $413 million net loss and lower
sales in its fiscal third quarter which ended Sept. 26.The net loss of
$413 million in the third quarter compares with a net loss of $7
million in the same period of
2008.
Third-quarter
sales decreased 17 percent to $3 billion compared with the same quarter
last year. Excluding the impact of foreign currency translation on the
international division, total company sales were down 15 percent.In the
North American retail division third-quarter sales were $1.3 billion,
down 18 percent compared with the same period last year, due in part to
having 117 fewer stores open in the third quarter of 2009 vs. the prior
year period.Comparable-store sales in the 1,144 stores in the U.S. and
Canada that have been open for more than one year decreased 14 percent
for the third quarter compared with the prior year period. Consistent
with previous periods, the decrease in comp-store sales was driven by
macroeconomic factors as consumers and small business customers
continued to hold back their spending, especially in large ticket
categories, and the division’s commitment to proactively reduce
unacceptable margin promotions in select categories, the company said.
The
North American retail division had an operating profit of $35 million
for the third quarter, compared with $12 million reported in the same
period of the prior year. The operating profit improvement was driven
by a number of factors including higher product margins for the fifth
straight quarter, a comparative benefit from closing underperforming
stores, lower asset impairment charges compared with last year, and
reduced operating expenses. These positive factors were partially
offset by the unfavorable impact the sales volume decline had on gross
margin and operating expenses, the retailers said.
During the
third quarter, Office Depot closed one store, opened one and relocated
three stores, bringing the total store count for North America to 1,158
as of Sept. 26.The North American business solutions division had
third-quarter sales of $880 million, down 16 percent compared with the
same period last year. The division reported an operating profit of $21
million for the third quarter of 2009 compared with $39 million for the
same period of the prior year.
The international division
reported sales of $861 million in the third quarter, a decrease of 16
percent compared with the same period last year, while sales in local
currency decreased by 9 percent.The unit’s operating profit was $34
million in the third quarter of 2009 compared with $36 million in the
same period of the prior year. The change in the division’s operating
profit for the third quarter of 2009 resulted as the flow through
impact of lower sales levels was almost completely offset by lower
operating expenses. Additionally, changes in foreign exchange rates,
driven by a stronger U.S. dollar, unfavorably impacted operating profit.