Staples Inc. (SPLS) reported fourth-quarter earnings that nipped past analyst predictions, although revenue came up light of expectations and profits sank as the U.S.’s largest office supply chain suffered from a raft a expenses related to restructuring efforts and less foot traffic in its stores. Meanwhile, the Framingham, Massachusetts-based company provided a forecast for the year that was below analyst estimates.
For the quarter ended February 2, 2013, total sales increased to $6.57 billion, up 3 percent from $6.37 billion in the fourth quarter of 2011. Sales benefited from an extra week this past quarter versus the year earlier period. Excluding the extra week, sales were lower by 4.2 percent at $6.11 billion. For the recent quarter, the company recorded a profit of $78.1 million, or 12 cents per share, which included over $180 million in charges related to store closings and more. In the fourth quarter of 2011, Staples reported a profit of $283.5 million, or 41 cents per share. Excluding one-time charges, adjusted profit equaled 46 cents per share in the latest quarter.
Wall Street was expecting Staples to report an adjusted profit of 45 cents per share and revenue of $6.72 billion.
Staples also said it raised its quarterly dividend by a penny to 12 cents a share.
“During the fourth quarter we did a great job managing expenses in a challenging sales environment,” said Ron Sargent, Chairman and Chief Executive Officer of Staples in today’s statement.
Same-store-sales for Staples softened in the last quarter versus the year earlier quarter with U.S. comparable sales down 5 percent and international comparable sales lower by 9 percent. Online sales perked by 7 percent when including the extra week in Q4 2012. Less the extra days, online sales were 1 percent lower.
Staples and its big box office supply rivals have been confronting strong headwinds in recent years as consumers turn to online shopping and mass merchants for their needs. Last month, Staples’ two largest competitors, Office Depot Inc. (ODP) and OfficeMax Inc. (OMX), agreed to merge in an all-share transaction to create a single company that generated an aggregate of $18 billion in sales in 2012.
For the complete year 2012, sales slipped to $24.38 billion from $24.66 billion in 2011. Adjusted earnings per share for 2012 were $1.39 per share, compared to $1.37 per share for 2011.
Looking ahead, the office supply giant see earnings per share from continuing operations in the range of $1.30 to $1.35 for all of 2013 and a low single-digit increase in sales. Wall Street analysts were expecting a 2 percent decline in sales, but $1.43 per share in earnings.
Shares of SPLS closed at $13.29 on Tuesday for 1.8% gains on the day, but are looking to trade lower at the opening bell with the disappointing outlook for the year. Shares are down about 11 percent in the past 52 weeks.