Thursday, March 6, 2014
Excerpt from one of the reports that mentioned Staples’ “North American Stores and On-Line (results):
Sales for the fourth quarter of 2013 were $2.9 billion, a decrease of 12 percent compared to the fourth quarter of 2012. Excluding $221 million of sales during the extra week in 2012, fourth quarter 2013 sales decreased six percent. Changes in foreign exchange rates negatively impacted fourth quarter 2013 sales growth by approximately one percent. Sales growth was also negatively impacted by approximately one percent due to 63 store closures during the 12 months preceding the fourth quarter of 2013, net of estimated sales transfers to remaining stores. Sales declines in business machines and technology accessories, office supplies, and computers, were partially offset by growth in facilities and breakroom supplies, paper, and copy and print. Comparable store sales, which exclude sales in Staples.com, decreased seven percent, reflecting a six percent decline in traffic and a one percent decline in average order size versus the prior year. Staples.com sales grew 10 percent during the fourth quarter of 2013, after excluding the impact of the extra week in 2012 and changes in foreign exchange rates. This reflects increased customer traffic and improved customer conversion. Operating income rate decreased 355 basis points to 6.07 percent compared to the fourth quarter of 2012. This decline primarily reflects lower product margins in Staples.com, an unfavorable comparison to the highly profitable extra week last year, the negative impact of fixed costs on lower sales, and increased costs related to growth initiatives in Staples.com. During the fourth quarter of 2013, the company closed 10 stores and opened one store in the U.S. and closed two stores in Canada.
SAN FRANCISCO (MarketWatch) — Staples Inc. skidded Thursday after reporting disappointing quarterly results. Staples SPLS -15.60% slid 15% after reporting fourth-quarter results that missed Wall Street’s forecasts. The office-supplies retailer also said it plans to close 225 stores by the end of 2015.
From Bloomberg - By Cotten Timberlake Mar 6, 2014 11:17 AM ET
Staples to Shut 225 Stores to Trim $500 Million in Costs
Staples Inc. (SPLS), the largest U.S. office-supplies chain, will close as many as 12 percent of its North American stores and cut as much as $500 million in costs as online competition continues to hurt sales. The shares fell.
The annual pretax savings, which the company expects to achieve by the end of 2015, will come from areas including the supply chain, sales force, marketing and information-technology services, in addition to the store closings, the Framingham, Massachusetts-based company said in a statement today.
The retailer is facing increased threats from Internet-based rivals such as Amazon.com Inc., a challenge that spurred Office Depot Inc. to merge with OfficeMax Inc. last year. Staples said sales in its fiscal first quarter will fall from a year earlier, the fifth straight quarterly decline, and profit will be as much as 22 cents a share, trailing analysts’ 27-cent average estimate.
Staples’ sales slowdown “reflects both tough industry conditions and underperformance” by the chain, Denise Chai, an analyst with Bank of America Corp. in New York, wrote in a note to clients today. She has the equivalent of a sell rating on the shares.
The shares fell 15 percent to $11.35 at 11:08 a.m. in New York and earlier dropped as much as 17 percent for the biggest intraday decline since Aug. 15, 2012. The stock slid 16 percent this year through yesterday, compared with a 1.4 percent gain for the Standard & Poor’s 500 Index.
Link to another (this one, a very detailed) article about Staples’ financial results:
Posted by Joel Salus at 9:52 AM