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Office Depot Q3 N.A. Retail Sales Drooped By 1%

Impacted by a disappointing back to school season and ongoing negative sales comps in furniture and technology products, such as computers, Office Depot reported a 1 percent third quarter sales decline for its North American Retail segment.

Sales reached $1.46 billion for the three months, down from $1.47 billion in the year-ago period. Comp store sales in North America dipped 2 percent in the third quarter.

However, the office products retailer increased its third quarter gross profit at North American stores, to $375.4 million, up from $358.8 million in the same three months in 2001. Gross margin jumped 129 basis points in the third quarter.

Total Office Depot sales in the third quarter grew 4 percent, hitting $2.9 billion, up from $2.8 billion in the year-ago three months.

Operating income rose 41 percent in the third quarter, ended Sept. 28, reaching $142.1 million, compared with $100.8 million in the third quarter of 2001. Net income for the period rose to $88.2 million, up from $62.5 million year over year.

For the nine months, North American Retail division sales were relatively flat, reaching $4.38 billion, compared with $4.36 billion in the same period in 2001. Comp sales declined 2 percent. Gross profit rose to $1.1 billion, up from $1 billion the previous year.

Year-to-date overall Office Depot sales climbed 3 percent, to $8.5 billion. Operating income increased 44 percent, hitting $397.8 million, and year-to-date net earnings reached $247.8 million, up from $160.8 million the previous year.