Exhibit 99.1.1
CONTACTS:
Brian Turcotte
Investor Relations
561-438-3657
brian.turcotte@officedepot.com
Brian Levine
Public Relations
561-438-2895
brian.levine@officedepot.com
OFFICE DEPOT ANNOUNCES SECOND QUARTER RESULTS
Delray Beach, Fla., July 30, 2008 —Office Depot, Inc. (NYSE: ODP), a leading global provider of office products and services, today announced results for the fiscal period ending June 28, 2008.
SECOND QUARTER RESULTS1
Total Company sales for the second quarter decreased 1% to $3.6 billion. Total Company operating expenses, adjusted for Charges, represented 26.9% of sales, an increase of 110 basis points over the second quarter of 2007. EBIT, as adjusted, was $21 million in the second quarter of 2008 or 0.6% as a percentage of sales, compared to $170 million or 4.7% in the prior-year period.
The Company reported a net loss of $2 million in the second quarter of 2008, compared to earnings of $106 million in the same period of 2007. The loss per share on a diluted basis was $0.01 for the quarter, versus earnings per share of $0.38 in the second quarter of 2007. On an adjusted basis, diluted earnings per share were $0.04 for the second quarter, versus $0.41 in the same period one year ago.
SECOND QUARTER DIVISION RESULTS
North American Retail Division
Second quarter sales in the North American Retail Division were down 6% to $1.4 billion. Comparable store sales in the 1,178 stores in the U.S. and Canada that have been open for more than one year decreased 10% for the second quarter. Persistent weakness in Florida and California continued to weigh heavily on results; however, the sales decline in these two states is consistent with what has been reported over the past few quarters. Outside of those two states, a further decline in demand has occurred as this economic slowdown has spread to most regions of the country.
The North American Retail Division had an operating loss of $4 million for the second quarter, a decline from the operating profit of $99 million in the same period of the prior year. Operating profit as a percentage of sales decreased 680 basis points to a negative 0.3% versus a positive 6.5% in the second quarter of 2007. Operating margin was negatively impacted by lower product margins, inventory costs and shrink, and de-leveraging of fixed expenses. Partially offsetting this margin decline was increased private brand penetration.
| | |
| 1 | | Includes non-GAAP information. Second quarter results include impacts of previously announced programs (“Charges”). Additional information is provided in our Form 10-Q filing. Reconciliations from GAAP to non-GAAP financial measures can be found in this release, as well as on the corporate web site,www.officedepot.com , under the category Investor Relations. |
1
During the second quarter, Office Depot opened six new stores, closed one, and relocated three stores, bringing the total store count to 1,272. The Company also remodeled two stores in the quarter.
Inventory per store was $909 thousand at the end of the second quarter of 2008, down approximately 6% from the prior year. This decrease is a result of inventory management and the mitigation of inventory risk through clearance activities.
North American Business Solutions Division
Second quarter sales in the North American Business Solutions Division were $1.1 billion, down 5% compared to the same period last year. Low single digit sales growth with our large, national account customers and the public sector was more than offset by a 10% sales decrease with our small- to medium-sized customers in the second quarter of 2008. Sales were negatively impacted by continued softness among small- to medium-sized business customers in Florida and California, which account for approximately 30% of the Division’s sales.
The North American Business Solutions Division operating profit was $49 million for the second quarter of 2008 compared to $78 million for the same period of the prior year. Operating margin declined by 240 basis points to 4.6% versus 7.0% in the second quarter 2007. The decrease in operating margin reflects lower product margins, inventory shrink and de-leveraging of fixed costs. Partially offsetting this margin decline was a reduction in operating expenses.
International Division
The International Division reported a sales increase of 13% in the second quarter of 2008 to $1.1 billion, compared with the same period last year, while sales in local currency increased by 2%. While the U.K. business has improved sequentially, continued weakness in the U.K. compared to last year, together with a broadening decline in the macroeconomic environment across Europe, constrained sales growth in the second quarter.
Division operating profit was $51 million in the second quarter of 2008 compared to $42 million in the same period of the prior year. Operating profit margin was up slightly year-over-year at 4.6% as a gain, resulting in lower employee-related costs, was largely offset by investments made to support growth initiatives.
Other Matters
The Company has received recently an unsolicited non-binding proposal from its partner in its Mexican joint venture in which its joint venture partner proposes to acquire the capital stock in the joint venture owned by the Company for approximately $430 million. The Company has not yet engaged in substantive discussions with its joint venture partner regarding this non-binding proposal and there can be no assurance that any agreement on financial or other terms satisfactory to the Company will result from such proposal or that any transaction involving the Company will be approved or completed.
During the first quarter of 2008, Office Depot amended its Revolving Credit Facility. Based on current projected operating results, the Company anticipates remaining in compliance with all of the restrictive covenants. However, given the uncertain economic environment, the Company is seeking a new credit facility to replace its existing facility. Office Depot has obtained commitments for a fully underwritten facility in excess of $1 billion that will be in place by the end of the third quarter 2008. The Amended Credit Agreement will be collateralized by the Company’s accounts receivable and inventory in the U.S. and significant international subsidiaries.
2
Subsequent to second quarter end, the Company acquired a controlling interest in AGE Kontor & Data AB, a contract and retail office supply company operating in Sweden.
Additional information on the Company’s results for the period can be found in the second quarter Form 10-Q filed with the Securities and Exchange Commission.
Non-GAAP Reconciliation
A reconciliation of GAAP results to non-GAAP results excluding certain items is presented in this release and also may be accessed on the corporate website,www.officedepot.com , under the category Company Info.
Conference Call Information
Office Depot will hold a conference call for investors and analysts at 9 a.m. (Eastern Daylight Time) today. The conference call will be available to all investors via Web cast athttp://investor.officedepot.com. Interested parties may contact Investor Relations at 561-438-7893 for further information.
About Office Depot
Every day, Office Depot is Taking Care of Business for millions of customers around the globe. For the local corner store as well as Fortune 500 companies, Office Depot provides products and services to its customers through 1,680 worldwide retail stores, a dedicated sales force, top-rated catalogs and a $5.0 billion e-commerce operation. Office Depot has annual sales of approximately $15.4 billion, and employs about 49,000 associates around the world. The Company provides more office products and services to more customers in more countries than any other company, and currently sells to customers directly or through affiliates in 44 countries.
Office Depot’s common stock is listed on the New York Stock Exchange under the symbol ODP and is included in the S&P 500 Index. Additional press information can be found at: http://mediarelations.officedepot.com.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS: The Private Securities Litigation Reform Act of 1995, as amended (the “Act”) provides protection from liability in private lawsuits for “forward-looking” statements made by public companies under certain circumstances, provided that the public company discloses with specificity the risk factors that may impact its future results. We want to take advantage of the “safe harbor” provisions of the Act. Certain statements made in this press release are ‘forward-looking’ statements under the Act. Except for historical financial and business performance information, statements made in this press release should be considered ‘forward-looking’ as referred to in the Act. Much of the information that looks towards future performance of our company is based on various factors and important assumptions about future events that may or may not actually come true. As a result, our operations and financial results in the future could differ materially and substantially from those we have discussed in the forward-looking statements made in this press release. Certain risks and uncertainties are detailed from time to time in our filings with the United States Securities and Exchange Commission (“SEC”). You are strongly urged to review all such filings for a more detailed discussion of such risks and uncertainties. The Company’s SEC filings are readily obtainable at no charge atwww.sec.gov and atwww.freeEDGAR.com, as well as on a number of other commercial web sites.
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OFFICE DEPOT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
(Unaudited)
| | | | | | | | | | | | | |
| | | As of | | | As of | | | As of | |
| | | June 28, | | | December 29, | | | June 30, | |
| | | 2008 | | | 2007 | | | 2007 | |
Assets | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Current assets: | | | | | | | | | | | | |
| Cash and cash equivalents | | $ | 156,607 | | | $ | 222,954 | | | $ | 122,695 | |
| Receivables, net | | | 1,471,710 | | | | 1,511,681 | | | | 1,466,714 | |
| Inventories | | | 1,647,044 | | | | 1,717,662 | | | | 1,586,241 | |
| Deferred income taxes | | | 99,398 | | | | 120,162 | | | | 64,474 | |
| Prepaid expenses and other current assets | | | 166,247 | | | | 143,255 | | | | 148,295 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Total current assets | | | 3,541,006 | | | | 3,715,714 | | | | 3,388,419 | |
| | | | | | | | | | | | | |
| Property and equipment, net | | | 1,695,581 | | | | 1,588,958 | | | | 1,463,361 | |
| Goodwill | | | 1,391,656 | | | | 1,282,457 | | | | 1,228,681 | |
| Other intangible assets | | | 110,964 | | | | 107,987 | | | | 108,696 | |
| Other assets | | | 579,175 | | | | 561,424 | | | | 439,579 | |
| | | | | | | | | | |
| Total assets | | $ | 7,318,382 | | | $ | 7,256,540 | | | $ | 6,628,736 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
Liabilities and stockholders’ equity | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Current liabilities: | | | | | | | | | | | | |
| Trade accounts payable | | $ | 1,398,321 | | | $ | 1,591,154 | | | $ | 1,582,487 | |
| Accrued expenses and other current liabilities | | | 1,148,041 | | | | 1,170,775 | | | | 1,095,197 | |
| Income taxes payable | | | 13,063 | | | | 3,491 | | | | 2,167 | |
| Short-term borrowings and current maturities of long-term debt | | | 296,884 | | | | 207,996 | | | | 68,878 | |
| | | | | | | | | | |
| | | | | | | | | | | | | |
| Total current liabilities | | | 2,856,309 | | | | 2,973,416 | | | | 2,748,729 | |
| | | | | | | | | | | | | |
| Deferred income taxes and other long-term liabilities | | | 579,371 | | | | 576,254 | | | | 534,679 | |
| Long-term debt, net of current maturities | | | 615,653 | | | | 607,462 | | | | 564,107 | |
| Minority interest | | | 5,255 | | | | 15,564 | | | | 14,737 | |
| | | | | | | | | | | | | |
| Commitments and contingencies | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Stockholders’ equity: | | | | | | | | | | | | |
| Common stock — authorized 800,000,000 shares of $.01 par value; issued and outstanding shares — 280,962,284 in 2008, 428,777,625 in December 2007 and 428,553,951 in June 2007 | | | 2,810 | | | | 4,288 | | | | 4,286 | |
| Additional paid-in capital | | | 1,177,644 | | | | 1,784,184 | | | | 1,757,070 | |
| Accumulated other comprehensive income | | | 587,649 | | | | 495,916 | | | | 340,551 | |
| Retained earnings | | | 1,551,979 | | | | 3,783,805 | | | | 3,647,543 | |
| Treasury stock, at cost — 5,972,334 shares in 2008, 155,819,358 shares in December 2007 and 155,784,207 shares in June 2007 | | | (58,288 | ) | | | (2,984,349 | ) | | | (2,982,966 | ) |
| | | | | | | | | | |
| Total stockholders’ equity | | | 3,261,794 | | | | 3,083,844 | | | | 2,766,484 | |
| | | | | | | | | | |
| Total liabilities and stockholders’ equity | | $ | 7,318,382 | | | $ | 7,256,540 | | | $ | 6,628,736 | |
| | | | | | | | | | |
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OFFICE DEPOT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | 13 Weeks Ended | | | 26 Weeks Ended | |
| | | June 28, | | | June 30, | | | June 28, | | | June 30, | |
| | | 2008 | | | 2007 | | | 2008 | | | 2007 | |
| Sales | | $ | 3,605,073 | | | $ | 3,631,599 | | | $ | 7,567,090 | | | $ | 7,725,199 | |
| Cost of goods sold and occupancy costs | | | 2,621,557 | | | | 2,535,480 | | | | 5,414,894 | | | | 5,359,972 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Gross profit | | | 983,516 | | | | 1,096,119 | | | | 2,152,196 | | | | 2,365,227 | |
| | | | | | | | | | | | | | | | | |
| Store and warehouse operating and selling expenses | | | 811,694 | | | | 799,494 | | | | 1,678,500 | | | | 1,685,186 | |
| General and administrative expenses | | | 175,224 | | | | 149,788 | | | | 373,774 | | | | 311,318 | |
| Amortization of deferred gain on building sale | | | (1,873 | ) | | | (1,873 | ) | | | (3,746 | ) | | | (3,746 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Operating profit (loss) | | | (1,529 | ) | | | 148,710 | | | | 103,668 | | | | 372,469 | |
| | | | | | | | | | | | | | | | | |
| Other income (expense): | | | | | | | | | | | | | | | | |
| Interest income | | | 5,604 | | | | 1,241 | | | | 6,509 | | | | 2,101 | |
| Interest expense | | | (14,406 | ) | | | (18,031 | ) | | | (29,226 | ) | | | (30,671 | ) |
| Miscellaneous income, net | | | 6,502 | | | | 9,874 | | | | 14,943 | | | | 19,695 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Earnings (loss) before income taxes | | | (3,829 | ) | | | 141,794 | | | | 95,894 | | | | 363,594 | |
| | | | | | | | | | | | | | | | | |
| Income taxes | | | (1,827 | ) | | | 36,212 | | | | 29,123 | | | | 104,241 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Net earnings (loss) | | $ | (2,002 | ) | | $ | 105,582 | | | $ | 66,771 | | | $ | 259,353 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| Earnings (loss) per common share: | | | | | | | | | | | | | | | | |
| Basic | | $ | (0.01 | ) | | $ | 0.39 | | | $ | 0.24 | | | $ | 0.95 | |
| Diluted | | | (0.01 | ) | | | 0.38 | | | | 0.24 | | | | 0.93 | |
| | | | | | | | | | | | | | | | | |
| Weighted average number of common shares outstanding: | | | | | | | | | | | | | | | | |
| Basic | | | 272,845 | | | | 271,879 | | | | 272,620 | | | | 273,690 | |
| Diluted | | | 273,362 | | | | 275,952 | | | | 273,101 | | | | 278,041 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
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OFFICE DEPOT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| | | | | | | | | |
| | | 26 Weeks Ended | |
| | | June 28, | | | June 30, | |
| | | 2008 | | | 2007 | |
Cash flow from operating activities: | | | | | | | | |
| Net earnings | | $ | 66,771 | | | $ | 259,353 | |
| Adjustments to reconcile net earnings to net cash provided by operating activities: | | | | | | | | |
| Depreciation and amortization | | | 130,390 | | | | 139,609 | |
| Charges for losses on inventories and receivables | | | 64,678 | | | | 47,335 | |
| Changes in working capital and other | | | (124,098 | ) | | | (153,134 | ) |
| | | | | | | |
| Net cash provided by operating activities | | | 137,741 | | | | 293,163 | |
| | | | | | | |
| | | | | | | | | |
Cash flows from investing activities: | | | | | | | | |
| Capital expenditures | | | (206,840 | ) | | | (225,330 | ) |
| Acquisitions, net of cash acquired, and related payments | | | (84,659 | ) | | | (47,591 | ) |
| Release of restricted cash | | | 18,100 | | | | — | |
| Purchase of assets sold and held for sale | | | (39,772 | ) | | | — | |
| Proceeds from assets sold and other | | | 36,781 | | | | 83,290 | |
| | | | | | | |
| Net cash used in investing activities | | | (276,390 | ) | | | (189,631 | ) |
| | | | | | | |
| | | | | | | | | |
Cash flows from financing activities: | | | | | | | | |
| Proceeds from exercise of stock options and sale of stock under employee stock purchase plans | | | 855 | | | | 25,294 | |
| Tax benefits from employee share-based payments | | | 56 | | | | 11,625 | |
| Acquisition of treasury stock under approved repurchase plans | | | — | | | | (199,592 | ) |
| Treasury stock additions from employee related plans | | | (944 | ) | | | (9,801 | ) |
| Net proceeds on long- and short-term borrowings | | | 69,279 | | | | 16,674 | |
| | | | | | | |
| Net cash provided by (used in) financing activities | | | 69,246 | | | | (155,800 | ) |
| | | | | | | |
| | | | | | | | | |
Effect of exchange rate changes on cash and cash equivalents | | | 3,056 | | | | 1,411 | |
| | | | | | | | | |
| Net decrease in cash and cash equivalents | | | (66,347 | ) | | | (50,857 | ) |
| Cash and cash equivalents at beginning of period | | | 222,954 | | | | 173,552 | |
| | | | | | | |
| Cash and cash equivalents at end of period | | $ | 156,607 | | | $ | 122,695 | |
| | | | | | | |
| | | | | | | | | |
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OFFICE DEPOT, INC.
Comparative Trailing Four Quarters Data and
GAAP to Non-GAAP Reconciliations
(Unaudited)
| | | | | | | | | |
| | | Trailing 4 Quarters |
| Total Company | | June 28, | | June 30, |
| (Dollars in millions) | | 2008 | | 2007 |
| Sales | | $ | 15,369.4 | | | $ | 15,425.4 | |
| | | | | | | | | |
EBIT1 | | $ | 238.7 | | | $ | 752.9 | |
| % of sales | | | 1.6% | | | | 4.9% | |
EBIT — as adjusted1 | | $ | 279.5 | | | $ | 814.1 | |
| % of sales | | | 1.8% | | | | 5.3% | |
| | | | | | | | | |
| Net earnings | | $ | 203.0 | | | $ | 515.0 | |
Net earnings — as adjusted1 | | $ | 232.0 | | | $ | 557.1 | |
| | | | | | | | | |
| Diluted Earnings Per Share | | $ | 0.74 | | | $ | 1.84 | |
Diluted Earnings Per Share — as adjusted1 | | $ | 0.85 | | | $ | 1.99 | |
| | | | | | | | | |
EBITDA — as adjusted1 | | $ | 536.8 | | | $ | 1,067.5 | |
| % of sales | | | 3.5% | | | | 6.9 | |
| | | | | | | | | |
Return on Invested Capital (ROIC) — as adjusted 1 | | | 8.1% | | | | 15.2% | |
| | | | | | | | | |
| Average shares | | | 273.5 | | | | 280.3 | |
| | |
| 1 | | EBIT and EBITDA are non-GAAP financial measures; EBIT — as adjusted and EBITDA — as adjusted exclude the Charges. (bps = basis points) |
The Company is committed to measuring and reporting results in conformity with accounting principles generally accepted in the United States of America (“GAAP”). However, management also recognizes that some financial measures other than those prepared in accordance with GAAP (“non-GAAP”) can provide meaningful and useful information about performance and allow for an informed assessment of possible future performance. Certain non-GAAP performance measures (e.g. EBIT and ROIC) are used to determine variable pay awards throughout our Company.
Non-GAAP measures in these tables exclude certain charges (“Charges”) that are important and required under GAAP but that may not clearly convey the on-going results of operating the business during the period. These measures also exclude a gain on sale of a building and a legal settlement, both recognized in the fourth quarter of 2006.
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OFFICE DEPOT, INC.
GAAP to Non-GAAP Reconciliations
The non-GAAP numbers presented along with the most closely related GAAP numbers, and the reconciliations are provided in the following tables.($ in millions)
| | | | | | | | | | | | | | | | | | | | | |
| Q2 2008 | | GAAP | | | % of Sales | | Charges | | | Non-GAAP | | | % of Sales |
| Gross Profit | | $ | 983.5 | | | | 27.3 | % | | $ | — | | | $ | 983.5 | | | | 27.3 | % |
| Operating Expenses | | $ | 985.0 | | | | 27.3 | % | | $ | (15.5 | ) | | $ | 969.5 | | | | 26.9 | % |
| Operating Profit (Loss) | | $ | (1.5 | ) | | | 0.0 | % | | $ | 15.5 | | | $ | 14.0 | | | | 0.4 | % |
| Net Earnings (Loss) | | $ | (2.0 | ) | | | (0.1 | )% | | $ | 11.8 | | | $ | 9.8 | | | | 0.3 | % |
| | | | | | | | | | | | | | |
| Diluted Earnings (Loss) Per Share | | $ | (0.01 | ) | | | | | | $ | 0.05 | | | $ | 0.04 | | | | | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| Q2 2007 | | GAAP | | | % of Sales | | Charges | | | Non-GAAP | | | % of Sales |
| Gross Profit | | $ | 1,096.1 | | | | 30.2 | % | | $ | 0.1 | | | $ | 1,096.2 | | | | 30.2 | % |
| Operating Expenses | | $ | 947.4 | | | | 26.1 | % | | $ | (11.8 | ) | | $ | 935.6 | | | | 25.8 | % |
| Operating Profit | | $ | 148.7 | | | | 4.1 | % | | $ | 11.9 | | | $ | 160.6 | | | | 4.4 | % |
| Net Earnings | | $ | 105.6 | | | | 2.9 | % | | $ | 8.7 | | | $ | 114.3 | | | | 3.1 | % |
| | | | | | | | | | | | | | |
| Diluted Earnings Per Share | | $ | 0.38 | | | | | | | $ | 0.03 | | | $ | 0.41 | | | | | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| YTD 2008 | | GAAP | | | % of Sales | | Charges | | | Non-GAAP | | | % of Sales |
| Gross Profit | | $ | 2,152.2 | | | | 28.4 | % | | $ | — | | | $ | 2,152.2 | | | | 28.4 | % |
| Operating Expenses | | $ | 2,048.5 | | | | 27.0 | % | | $ | (26.3 | ) | | $ | 2,022.2 | | | | 26.7 | % |
| Operating Profit | | $ | 103.7 | | | | 1.4 | % | | $ | 26.3 | | | $ | 130.0 | | | | 1.7 | % |
| Net Earnings | | $ | 66.8 | | | | 0.9 | % | | $ | 21.1 | | | $ | 87.9 | | | | 1.2 | % |
| | | | | | | | | | | | | | |
| Diluted Earnings Per Share | | $ | 0.24 | | | | | | | $ | 0.08 | | | $ | 0.32 | | | | | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
| YTD 2007 | | GAAP | | | % of Sales | | Charges | | | Non-GAAP | | | % of Sales |
| Gross Profit | | $ | 2,365.2 | | | | 30.6 | % | | $ | 0.2 | | | $ | 2,365.4 | | | | 30.6 | % |
| Operating Expenses | | $ | 1,992.7 | | | | 25.8 | % | | $ | (23.7 | ) | | $ | 1,969.0 | | | | 25.5 | % |
| Operating Profit | | $ | 372.5 | | | | 4.8 | % | | $ | 23.9 | | | $ | 396.4 | | | | 5.1 | % |
| Net Earnings | | $ | 259.4 | | | | 3.4 | % | | $ | 20.4 | | | $ | 279.8 | | | | 3.6 | % |
| | | | | | | | | | �� | | | | |
| Diluted Earnings Per Share | | $ | 0.93 | | | | | | | $ | 0.08 | | | $ | 1.01 | | | | | |
| | | | | | | | | | | | | | |
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Office Depot, Inc.
DIVISION INFORMATION
(Unaudited)
North American Retail Division
| | | | | | | | | | | | | | | | | |
| | | Second Quarter | | First Half |
| (Dollars in millions) | | 2008 | | 2007 | | 2008 | | 2007 |
| Sales | | $ | 1,433.1 | | | $ | 1,525.3 | | | $ | 3,146.5 | | | $ | 3,373.9 | |
| % change | | | -6% | | | | 1% | | | | -7% | | | | 2% | |
| | | | | | | | | | | | | | | | | |
| Division operating profit (loss) | | $ | (4.4) | | | $ | 99.2 | | | $ | 78.1 | | | $ | 251.6 | |
| % of sales | | | -0.3% | | | | 6.5% | | | | 2.5% | | | | 7.5% | |
North American Business Solutions Division
| | | | | | | | | | | | | | | | | |
| | | Second Quarter | | First Half |
| (Dollars in millions) | | 2008 | | 2007 | | 2008 | | 2007 |
| Sales | | $ | 1,064.1 | | | $ | 1,123.2 | | | $ | 2,168.1 | | | $ | 2,285.6 | |
| % change | | | -5% | | | | —% | | | | -5% | | | | 1% | |
| | | | | | | | | | | | | | | | | |
| Division operating profit | | $ | 49.3 | | | $ | 78.3 | | | $ | 108.9 | | | $ | 150.5 | |
| % of sales | | | 4.6% | | | | 7.0% | | | | 5.0% | | | | 6.6% | |
International Division
| | | | | | | | | | | | | | | | | |
| | | Second Quarter | | First Half |
| (Dollars in millions) | | 2008 | | 2007 | | 2008 | | 2007 |
| Sales | | $ | 1,107.9 | | | $ | 983.0 | | | $ | 2,252.5 | | | $ | 2,065.7 | |
| % change | | | 13% | | | | 14% | | | | 9% | | | | 18% | |
| % change in local currency sales | | | 2% | | | | 7% | | | | -1% | | | | 9% | |
| | | | | | | | | | | | | | | | | |
| Division operating profit | | $ | 51.2 | | | $ | 42.1 | | | $ | 111.3 | | | $ | 124.2 | |
| % of sales | | | 4.6% | | | | 4.3% | | | | 4.9% | | | | 6.0% | |
Division operating profit excludes Charges from the Division performance, as those Charges are evaluated at a corporate level.
9
Office Depot, Inc.
SELECTED FINANCIAL AND OPERATING DATA
(Unaudited)
Other Selected Financial Information
| | | | | | | | | |
| | | 26 Weeks Ended | | 26 Weeks Ended |
| (In thousands, except operational data) | | June 28, 2008 | | June 30, 2007 |
| | | | | | | | | |
| Cumulative share repurchases under approved repurchase plans ($): | | $ | — | | | $ | 199,592 | |
| | | | | | | | | |
| Cumulative share repurchases under approved repurchase plans (shares): | | | — | | | | 5,702 | |
| | | | | | | | | |
| Shares outstanding, end of quarter | | | 274,990 | | | | 272,770 | |
| | | | | | | | | |
| Amount authorized for future share repurchases, end of quarter ($): | | $ | 500,000 | | | | | |
Selected Operating Highlights
| | | | | | | | | | | | | | | | | |
| | | 13 Weeks Ended | | 26 Weeks Ended |
| | | June 28, 2008 | | June 30, 2007 | | June 28, 2008 | | June 30, 2007 |
| Store Statistics | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| United States and Canada: | | | | | | | | | | | | | | | | |
| Store count: | | | | | | | | | | | | | | | | |
| Stores opened | | | 6 | | | | 15 | | | | 51 | | | | 31 | |
| Stores closed | | | 1 | | | | 3 | | | | 1 | | | | 3 | |
| Stores relocated | | | 3 | | | | — | | | | 4 | | | | — | |
| Total U.S. and Canada stores | | | 1,272 | | | | 1,186 | | | | 1,272 | | | | 1,186 | |
| | | | | | | | | | | | | | | | | |
| North American Retail Division square footage: | | | 30,812,400 | | | | 29,062,748 | | | | | | | | | |
| Average square footage per NAR store | | | 24,224 | | | | 24,505 | | | | | | | | | |
| Inventory per store (end of period) | | $ | 909,000 | | | $ | 965,000 | | | | | | | | | |
| International Division company-owned: | | | | | | | | | | | | | | | | |
| Store count: | | | | | | | | | | | | | | | | |
| Stores opened | | | 1 | | | | 2 | | | | 2 | | | | 13 | |
| Stores closed | | | — | | | | 1 | | | | 1 | | | | 1 | |
| Total International company-owned stores | | | 149 | | | | 137 | | | | 149 | | | | 137 | |
10
