OFFICE DEPOT SUPPLIES UPSIDE

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OFFICE DEPOT SUPPLIES UPSIDE

 user 2006-05-05 at 11:28:00 am Views: 60
  • #15362

    Office Depot Supplies Upside
    Office
    Depot  posted a 12% rise in first-quarter earnings Tuesday, beating
    Wall Street’s forecast, as a focus on margin improvements continued to
    bear fruit.

    The
    office-supply retailer’s earnings rose to $129.5 million, or 43 cents a
    share, from $115.3 million, or 37 cents a share, a year earlier. The
    earnings included 5 cents a share in charges related to costs from
    closing stores and other items.
    Excluding the charges, Office
    Depot’s earnings of 48 cents a share topped analysts’ mean estimate by
    4 cents, according to Thomson First Call.
    Sales rose just 3% to
    $3.82 billion from $3.70 billion last year, slightly shy of Wall
    Street’s target of $3.86 billion. North American retail same-store
    sales advanced 3%.
    The company’s gross profit as a percentage of
    sales was 31.5%, a 40-basis-point improvement over a year ago. Gross
    margin improvements in the North American retail division, which was
    helped by cost cuts and increased private-brand sales, helped offset a
    decline in margins at the company’s business solutions segment.
    Office
    Depot has been undergoing a round of cost-cutting, including store
    closings and consolidations, after bringing in CEO Steve Odland from
    AutoZone  last year to help boost profits. At AutoZone, Odland was
    known for focusing on margin improvements and profitability over sales
    growth.