Staples Reports Q3 Financials
Promo Products Division Increases By 6%
Citing weak demand, Staples, Inc., the parent company of Counselor Top 40 distributor Staples Promotional Products (SPP) (asi/120601), reported sales for the quarter ended November 2 decreased 4% to $6.11 billion. While Staples did not publicly break out its Q3 ad specialty sales figures, Staples Promotional Products increased its third-quarter sales by about 6%, according to Rich Witaszak, general manager of SPP.
“Our numbers were in line with Q3 distributor sales Counselor recently reported for large firms,” Witaszak said. “We are optimistic that our solid growth will continue in the fourth quarter and full-year results will show growth over last year.”
While Staples Promotional Products had a positive Q3, Staples, Inc. announced uneven results. The company said comparable store sales in North America, excluding online orders, declined 3%. Staples’ operating expenses, meanwhile, fell 39% to $1.29 billion as the company closed 107 stores in North America and Europe over the past year. Net earnings were $135.2 million, a significant turnaround when compared to the $596 million loss the company reported a year earlier during the same period.
Despite a spotty Q3, Staples maintained its full-year revenue forecast, saying it continues to expect sales to decrease in the low-single-digit percentage range. The company is projecting a profit gain of $1.21-$1.25 per share, in line with the forecasts of analysts.
Staples Promotional Products appears to be headed for sales gains in 2013. Earlier this year, Witaszak told Counselor that SPP increased its first-quarter sales by “mid-single digits.” SPP did not provide any comments, though, about its second-quarter numbers. The largest distributor in the industry, Counselor estimates Staples Promotional Products generated 2012 North American ad specialty sales of $409.4 million, a year-over-year increase of 5%.