Staples Reports Lower Sales, Profits In Qtr.

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Framingham, Mass. – Staples reported lower sales and net income for its second fiscal quarter, ended July 28, due to softer sales in North America and weakness in Europe and Australia.

Total company sales for the second quarter of 2012 were $5.5 billion, a decrease of 6 percent compared with the second quarter of 2011.

Net income was $120.4 million, down from the prior year’s $176.4 million, while operating income was $220 million, down from the prior year’s $278.1 million.

Staples’ North American retail segment had sales of $2 billion, 3 percent lower than the second quarter of last year.

Comp-store sales for the second quarter of 2012 decreased 2 percent, as traffic declined 2 percent and average order size was flat vs. the prior year.

Lower sales of computers, software and computer accessories were somewhat offset by growth of copy and print, mobile phones and accessories, and facilities and other supplies, Staples said.

North American retail segment operating profit was $81.4 million during the quarter, down from the prior year’s $102.9 million.

During the second quarter, the company opened four stores and closed five in the U.S. and opened two stores in Canada, ending the quarter with 1,915 stores in North America.

For the balance of the fiscal year Staples is adopting a more conservative sales and earnings outlook. Current expectations for 2012 assume slower growth in the U.S. economy and continued weakness in the demand environment in Europe.

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