Staples' Retail Sales Drop, Promotional Division Remains Steady in Q1
Staples, the office supply retailer and parent company to Staples Advantage and Staples Promotional Products, reported its earnings for the first quarter of 2013, ended May 4. The Framingham, Massachusetts-based company saw sales drop in both domestic and international stores over the same quarter last period, but had slight growth in its direct-to-business operations.
The company's first-quarter sales were $5.8 billion, a three-percent drop from the same period last year and slightly down from earlier projects of $5.9 billion. Earnings were $170 million, down from $193 million in 2012.
Staples attributed the sales and revenue drops to restructurings over the past year that saw the company close more than 60 stores and consolidate other business operations. The company's numbers were still an improvement over the quarter ended in March 2013, which saw profits drop 72 percent year-over-year due to the restructuring.
Two of Staples three divisions, North American Stores and Online and International Operations, saw sales drop four percent and 11 percent, respectively. The North American Stores and Online sales, at $2.8 billion, were said to be negatively impacted by the closing of stores and increased competition in computers and hardware. International Operations had sales of $1 billion, and the company attributed the 11 percent decline to weakness in Europe and Australia.
The only division to show a positive change was North American Commercial, which includes Staples' business-to-business divisions like Staples Advantage and Staples Promotional Products. First quarter sales were $2 billion, up two percent from the same quarter in 2012.
"We're gaining momentum in many parts of our business," said Ron Sargent, chairman and chief executive officer for Staples. "We're driving growth online and in categories beyond core office supplies, and we look forward to building on our progress throughout 2013."
The full earnings report is available on Staples' investor relations website.