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Staples Fiscal Q2 N.A. Retail Sales Flat

8/21/2001 11:38:00 AM Eastern

Framingham, Mass. - Faced with a difficult economic environment, office supply retailer Staples said it contained expenses and increased productivity during its fiscal second quarter, but sales barely grew and income was almost halved during this period.

Sales for the company's North American Retail segment during the second quarter crept up to $1.43 billion, from the $1.37 billion registered in the same quarter in 2000, while income for the segment was almost cut in half to $40.1 million, compared with $78.3 million in the year-ago second quarter.

In its North American Retail business, Staples said its sales per-store per-week were up 3.5 percent in the second quarter ended August 4, compared with the year-ago period. The retailer said customer count comps, namely the increase in customer traffic in North American stores, increased 3 percent during the second quarter, year over year.

Overall sales in the second three months climbed 5 percent, reaching $2.3 billion, compared with $2.2 billion in the year-ago period. Net income, however, dropped to $40.35 million, down from $42.56 million in the same three months in 2000. Retail comp-store sales in the quarter were down 3 percent, while overall comparable sales were flat.

Staples said sales in its delivery businesses, including Staples Direct, Staples Contract and Quill, combined with its e-commerce counterparts, grew 14 percent in the second quarter, compared with the year-ago three months.

For the six months, North American Retail segment sales reached $3.13 billion, compared with $3.06 billion in the first half of the previous fiscal year. Income in the North American Retail segment dipped dramatically, to $78.9 million, compared with $159.7 million in the same six months in 2000.

Overall sales were relatively flat, reaching $4.98 billion, compared with $4.76 billion in the comparable first six months of last year.

Overall net income for the six months was down to $79.9 million, compared with $86.7 million in the same six months in 2000.