Staples, Inc. Announces Third Quarter 2016 Performance

Staples, Inc. (Nasdaq: SPLS) announced today the results for its third quarter ended October 29, 2016. Total company sales for the third quarter of 2016 were $5.4 billion, a decrease of four percent compared to the third quarter of 2015. On a GAAP basis, the company reported net income of $179 million, or $0.27 per diluted share. Third quarter 2016 results on a GAAP basis include pre-tax charges of $57 million primarily related to impairment of intangible assets in International Operations.

Excluding the impact of the sale of the Staples Print Solutions business during the second quarter of 2016, store closures, and changes in foreign exchange rates, total company sales for the third quarter of 2016 decreased two percent compared to the third quarter of 2015. Excluding the impact of charges taken during the third quarter of 2016, the company reported non-GAAP net income of $220 million, or $0.34 per diluted share, versus third quarter 2015 non-GAAP net income of $226 million, or $0.35 per diluted share.

“During the third quarter we pivoted from planning to execution of the Staples 20/20 strategic plan while delivering results that were right in-line with our expectations,” said Shira Goodman, Staples’ Chief Executive Officer. “Staples 20/20 is a transformational change of our strategy, our mindset, and our operating model to reshape our company for sustainable long-term growth.”

Third Quarter 2016 Highlights
•Staples Business Advantage, the company’s North American contract business, experienced a sales decline of three percent compared to the third quarter of 2015 on a GAAP basis, and a sales increase of two percent after excluding a negative impact of approximately five percent due to the sale of the Staples Print Solutions business.
•Excluding pre-tax charges of $57 million during the third quarter of 2016 and $40 million during the third quarter of 2015, the company improved operating income rate by 22 basis points on a non-GAAP basis.
•Improved operating income rate in each of the company’s business units.
•Ended the third quarter of 2016 with $2.2 billion in liquidity, including $1.1 billion in cash and cash equivalents.
•Closed 16 stores during the third quarter of 2016 and 35 stores year to date in North America as part of a plan to close at least 50 stores in North America during 2016.
•Acquired Capital Office Products, an independent office products dealer that generates more than $100 million of annual revenue early in the fourth quarter of 2016.
more at: http://investor.staples.com/phoenix.zhtml?c=96244&p=irol-news&nyo=0

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