Net sales increased 29% to $56.6 billion in the third quarter, compared with $43.7 billion in third quarter 2017. Excluding the $260 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 30% compared with third quarter 2017. Operating income increased to $3.7 billion in the third quarter, compared with operating income of $347 million in third quarter 2017. Net income increased to $2.9 billion in the third quarter, or $5.75 per diluted share, compared with net income of $256 million, or $0.52 per diluted share, in third quarter 2017. Click read more below for additional detail.
Third Quarter 2019 Highlights
• Total Reported Sales of $2.8 Billion, down 4% from Prior Year Period • BSD and CompuCom divisions combined represent approximately 60% of total revenues
• Operating Income of $108 Million and Net Income from Continuing Operations of $60 Million• Includes charges related to the Business Acceleration Program
• Adjusted Operating Income of $137 Million, up 14% YOY; Adjusted EBITDA of $191 Million, up 11% YOY • Driven by strong operating performance in BSD and Retail divisions
• CompuCom Division operating performance continues to improve
• Operating Cash Flow of $212M and Adjusted Free Cash Flow of $209M
• Secured Bridge Loan to Align Maturity of Timber Note and Receivable for First Quarter 2020 • Company expects to receive net pretax cash inflow of approximately $82 million in 1Q 2020
Total reported sales for the third quarter of 2019 were $2.8 billion, a decrease of 4% compared to the third quarter of 2018. The decrease in revenue over the same period last year was primarily the result of lower sales in the Retail division, driven by lower same store sales combined with fewer retail stores, and lower sales in the CompuCom and BSD divisions. Product sales in the third quarter were down 3% relative to the prior year period. Service revenue was down 7% year-over-year related to lower comparable sales at CompuCom, partially mitigated by a 7% year-over-year increase in service revenue in the Retail division. On a same store comparable basis, service revenue increased by approximately 10% in the Retail division. On a consolidated basis, service revenue represented approximately 15% of total Company sales in the third quarter of 2019.
In the third quarter of 2019, Office Depot reported operating income of $108 million, compared to $105 million in the prior year period. Operating income included approximately $22 million in merger and restructuring costs, $16 million of which is associated with charges related to the Business Acceleration Program (BAP) recognized in the quarter. Office Depot also recognized asset impairment charges of $5 million in the third quarter of 2019, $2 million of which related to impairment of operating lease right-of-use (ROU) assets associated with the Company’s retail store locations, with the remainder primarily relating to impairment of fixed assets. These impacts were offset by improved operating results in the quarter versus the prior year period, as the Company delivered improved margin performance across all of its divisions. Net income from continuing operations was $60 million, or $0.11 per diluted share in the third quarter of 2019, compared to net income from continuing operations of $60 million, or $0.11 per diluted share in the third quarter of 2018.
For the year-to-date 2019 period, Office Depot reported operating income of $117 million, compared to $230 million for year-to-date 2018. Primary drivers of the comparable reduction are a $60 million increase in merger and restructuring costs largely associated with BAP-related charges and asset impairment charges of $50 million, $41 million of which related to impairment of operating lease ROU assets. Net income from continuing operations for year-to-date 2019 was $44 million, or $0.08 per diluted share, compared to net income from continuing operations of $113 million, or $0.20 per diluted share, for year-to-date 2018.
more detail at: http://investor.officedepot.com/news-releases/news-release-details/office-depot-announces-third-quarter-2019-results