Staples Inc. (NASDAQ: SPLS) reported third-quarter fiscal 2013 adjusted diluted earnings per share (EPS) of $0.46 and $6.35 billion in revenues before the markets opened this morning. In the same period a year ago, the office supply retailer reported EPS of $0.46 on revenue of $6.48 billion. These results also compare to the Thomson Reuters consensus estimates for EPS of $0.45 and $6.45 billion in revenue.
Source: Thinkstock
On a GAAP basis, Staples posted a net loss of $0.85 per share, compared with last year’s EPS of $0.46. The excluded items included impairment charges, restructuring, accelerated amortization and related tax charges during the third quarter totaling about $259 million.
The company’s CEO said:
During the third quarter we launched a new strategic plan to become the product authority for businesses, restructured our organization, and generated solid earnings excluding charges. Going forward, we are in a much stronger position to pursue our best growth opportunities.
Staples provided guidance for the full-fiscal year of flat sales compared with fiscal 2011. Full-year adjusted EPS is expected to increase in the low single-digits, compared with last year’s EPS of $1.37. The company expects to take fourth-quarter charges of $160 million to $200 million in one-time items.
The one-time charges have all been applied to trying to right the ship, but operationally sales are down 2% year-over-year and operating income is down 30 basis points, primarily due to lower margins. International sales fell 12% year-over-year and international same-store sales fell 6%, compared with a drop of 1% in North America. For the quarter, same-store sales fell 2.6% across all the company’s divisions.
Competitors Office Depot Inc. (NYSE: ODP) and OfficeMax Inc. (NYSE: OMX) are struggling as well, and a tie-up between the two is rumored. Amazon.com Inc. (NASDAQ: AMZN) is forcing Staples to spend more time and money to drive growth in its online business. Whether Staples can pull this off remains uncertain.
Shares are up almost 5% in premarket trading, at $11.80, in a 52-week range of $10.57 to $16.93. With more than 12% of the company’s shares held short, one might wonder if the rise is due to short covering early. Thomson Reuters had a consensus analyst price target of $12.60 before today’s results were announced.
Paul Ausick
Sponsored: Want to Retire Early? Here’s a Great First Step
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
