Office products provider Staples, Inc. (SPLS) said its third-quarter profit declined from the prior year, as sales dropped 6 percent year-over-year. However, adjusted earnings met Wall Street estimates, even as revenues trailed expectations.
Net income for the quarter dropped to $198 million from last year's $217 million. Earnings per share fell to $0.31 from $0.34.
The latest results included pre-tax charges of $40 million related to the acquisition of Office Depot, as well as $28 million primarily related to restructuring activities.
Adjusted earnings per share totaled $0.35, while it was $0.37 last year.
On average, 14 analysts polled by Thomson Reuters expected earnings of $0.35 per share for the quarter. Analysts' estimates typically exclude special items.
Sales dropped 6 percent to $5.59 billion from $5.96 billion. Analysts expected revenues of $5.67 billion.
Total company sales were flat, after excluding the impact of store closures during the past year and changes in foreign exchange rates.
Sales declined 7.8 percent in North American Stores and Online, impacted by four percent due to changes in foreign exchange rates. Store closures also negatively impacted third quarter 2015 sales growth by approximately three percent.
North American Commercial sales edged up 0.7 percent, reflecting growth in facilities supplies, promotional products, breakroom supplies, and furniture.
Ron Sargent, Staples' chairman and CEO, said, "We're driving solid sales and earnings growth in our North American Commercial business, and stabilizing results in North American Stores and Online. Our strategic reinvention is on track, and we look forward to accelerating the transformation of Staples with the acquisition of Office Depot."
For the fourth quarter, the company expects sales to decrease from the prior year. The company expects to achieve non-GAAP earnings per share in the range of $0.26 to $0.30 for the fourth quarter.
Analysts look for earnings of $0.28 per share on revenues of $5.48 billion.
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