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Staples Reports Fiscal Q3 Loss Due To Charges

Framingham, Mass. — Staples reported a net loss on a GAAP basis of $569 million in its fiscal third quarter, ended Oct. 27, and a slight decrease in net sales. 11/14/2012 05:07:00 AM Eastern

Framingham, Mass. — Staples reported a net loss on a GAAP basis of $569 million in its fiscal third quarter, ended Oct. 27, and a slight decrease in net sales.

As a result of previously announced charges, on a GAAP basis, Staples reported a net loss of $569 million from continuing operations, compared with net income of $324 million in the third quarter of 2011.

The operating loss was $357.1 million in the quarter, compared with operating income of $529.2 million in last year’s fiscal third quarter.

“During the third quarter we launched a new strategic plan to become the product authority for businesses, restructured our organization, and generated solid earnings excluding charges,” said Ron Sargent, Staples’ chairman/CEO. “Going forward, we are in a much stronger position to pursue our best growth opportunities.”

Total company sales for the third quarter of 2012 were $6.4 billion, a decrease of 2 percent in U.S. dollars and 1 percent on a local currency basis compared with the third quarter of 2011.

North American retail sales of $2.6 billion were flat compared with the third quarter of 2011. Comp-store sales for the third quarter of 2012 decreased 1 percent, as traffic declined 2 percent and average order size increased 1 percent vs. the prior year, Staples reported.

Lower sales of computers and software were somewhat offset by growth of copy and print services and core office supplies. Operating income rate increased 9 basis points to 10.79 percent compared with the third quarter of 2011. This increase primarily reflects lower operating expenses and distribution efficiencies, somewhat offset by investments in promotional activity, the retailer said.

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