Staples' Profits Rise 36% for Q2 2011
Framingham, Massachusetts-based Staples reported a 36 percent rise in the company's net income for the second quarter, with sales increased 5.2 percent. The company, which owns promotional products distributor Staples Promotional Products and business-to-business division Staples Advantages, had a net income of $176.4 million for the quarter, an increase over the $129.8 million profit from the second quarter 2010.
In a conference call with investors on Wednesday, Ron Sargent, chairman and chief executive officer, discussed the revenue breakdown for each of the company's divisions. Of particular note, Sargent stated that "promotional products increased double digits, [and] print solutions grew high-single digits even before the benefit of the PRINTSouth acquisition."
The company's overall revenue rose 5 percent to $5.82 billion, beating analysts predictions of $5.64 billion. 2010 revenue for the period was $5.33 billion.
Staples' strong quarter signaled confidence in a recovering office supply market, building on a slowly strengthening economy. Following the company's earnings call, as well as similarly strong report from retailer Target, the Standard & Poor 500 Index saw its fourth increase in five days, advancing 0.3 percent. The Dow Jones Industrial Average saw similar gains of 26 points, or 0.2 percent. These increase comes after a massive slide in stock values following Standard & Poor's downgrading of the United States' credit rating on August 5.