OfficeMax Posts Q3 Profit, Lower Sales

On Nov 9 2009 - 8:00am

OfficeMax reported a double-digit drop in sales, but a $5.7 million profit for the third quarter.

Total sales were $1.83 billion in the third quarter, down 12.6 percent compared with the third quarter of 2008.

Net income available to OfficeMax common shareholders of $5.7 million compared with the prior year’s net loss in the came category of $432.6 million. Operating income for the quarter was $25.2 million, compared with the prior year’s operating loss of $681.5 million.

OfficeMax Retail segment sales decreased 11 percent to $932.3 million in the third quarter of 2009, compared to the third quarter of 2008, reflecting a same-store sales decrease of 11.5 percent (a same-store sales decrease of 10 percent in local currencies), partially offset by sales from new stores.

Retail same-store sales for the third quarter of 2009 declined across all major product categories primarily due to weaker small business and consumer spending, unfavorable Mexican peso exchange rates and the influenza epidemic in Mexico.

Retail segment gross margin decreased to 27.4 percent in the third quarter of 2009, from 28.5 percent in the third quarter of 2008, primarily due to deleveraging of fixed occupancy costs from the same-store sales decrease, the chain reported.

OfficeMax ended the third quarter of 2009 with a total of 1,010 retail stores, consisting of 932 retail stores in the U.S. and 78 retail stores in Mexico. During the third quarter of 2009, OfficeMax closed one retail store in the U.S. and one in Mexico. For the full year 2009, OfficeMax expects to open 12 retail stores and to close up to 25 retail stores, of which 11 have opened and 23 have closed during the first nine months of 2009.

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