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Staples Reports Fiscal Profit In 3rd Qtr.

12/01/2013 07:00:00 PM Eastern

FRAMINGHAM, MASS. — Staples said aggressive expense management helped deliver third-quarter profits of $135.2 million following a year-ago loss of more than half a billion dollars.

Sales struggled though, falling 4 percent to $6.1 billion for the three months, ended Nov. 2, as a result of 107 store closures across Europe and North America and unfavorable currency exchange rates.

In North America, sales fell 5.3 percent to $3 billion due to the closure of 59 stores over the preceding 12 months and weak sales of computers, tech accessories and office supplies, partially offset by growth in tablets.

Comp sales in North America, excluding online, slipped 3 percent as traffic and average order size declined. Conversely, online sales rose 3 percent, reflecting increased site traffic and “stable” close rates, partially offset by lower average order size.

During the quarter the company reached its full-year cost-cutting goal of $150 million; relaunched Staples.com and increased its assortment by 70,000 products, or nearly 50 percent; and closed seven U.S. stores.

“It’s been a year since we announced our strategic reinvention, and we’re evolving our business to meet the changing needs of customers,” said chairman/CEO Ron Sargent. “We continue to face weak demand for core office supplies, but we’re driving growth online and in new categories, while aggressively managing expenses.”

The No. 1 office-supply chain, which now faces a potentially stronger competitor in a newly merged Office Depot and OfficeMax, is projecting a full-year sales decrease in the low single-digits.

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