Staples, Inc. (Nasdaq: SPLS) announced today the results for its
fourth quarter and fiscal year ended January 28, 2017. Total
company sales for the fourth quarter of 2016 were $4.6 billion, a
decrease of three percent compared to the fourth quarter of 2015.
On a GAAP basis, the company reported a net loss from continuing
operations of $615 million, or $0.94 per share. Fourth quarter 2016
results from continuing operations include pre-tax charges of $791
million primarily related to goodwill impairment, restructuring
costs, and the impairment of long-lived assets.
Total company comparable sales for the fourth quarter of 2016
declined one percent compared to the fourth quarter of 2015.
Excluding the impact of charges taken during the fourth quarter of
2016, the company reported non-GAAP net income from continuing
operations of $161 million, or $0.25 per diluted share, versus
fourth quarter 2015 non-GAAP net income from continuing operations
of $168 million, or $0.26 per diluted share.
“Our fourth quarter results were right in-line with our
expectations, and I’m increasingly confident that we have the right
plan and the right team to transform Staples and get back to
sustainable sales and earnings growth,” said Shira Goodman,
Staples’ Chief Executive Officer. “I am particularly proud of our
ability to grow our delivery business by continuing to enhance our
offering and satisfy our business customers.”
Fourth Quarter 2016 Financial
Summary
Fourth Quarter (dollar amounts in millions, except per share
data)
2016 2015 Change Total company sales
$4,560 $4,695 -2.9 % Total company comparable sales*^ -0.9 %
GAAP operating income -$548 $170 -$718 Non-GAAP operating income*
$243 $261 -$18 GAAP operating income rate -12.0 % 3.6 % NM
Non-GAAP operating income rate* 5.3 % 5.5 % -21 basis points
GAAP net income from continuing operations -$615 $130 -$745
Non-GAAP net income from continuing operations* $161 $168 -$7
GAAP earnings per share from continuing operations -$0.94
$0.20 NM Non-GAAP earnings per diluted share from continuing
operations* $0.25 $0.26
-4 %
*Indicates a non-GAAP measure. Refer to
“Presentation of Non-GAAP Information” and the accompanying
reconciliations for more detailed information about these non-GAAP
measures.
^Total company comparable sales excludes
the impact of acquisitions, divestitures, store closures and
foreign currency translation.
Fourth Quarter 2016 Highlights
- Staples Business Advantage, the
company’s North American contract business, achieved flat sales
compared to the fourth quarter of 2015 on a GAAP basis, and a
comparable sales increase of four percent.
- Improved total company gross profit
rate by 93 basis points year over year to 27.1 percent and grew
gross profit by $7 million.
- Generated $934 million of cash provided
by operating activities, spent $255 million in capital
expenditures, and generated $889 million of adjusted free cash flow
in 2016 excluding the after-tax impact to cash provided by
operating activities of $210 million related to charges associated
with financing for the proposed acquisition of Office Depot and
costs associated with the termination of the Office Depot merger
agreement.
- Returned $311 million to shareholders
through cash dividends in 2016.
- Ended the fourth quarter of 2016 with
$2.2 billion in liquidity, including $1.1 billion in cash and cash
equivalents.
- Acquired Capital Office Products, an
independent office products dealer that generated more than $100
million of revenue in its last fiscal year.
- Completed the sale of the company’s
retail business in the United Kingdom.
- Completed the sale of a controlling
interest in the remainder of the company’s European operations in
the first quarter of 2017.
Full Year 2016 Financial
Summary
Full Year (dollar amounts in millions, except per share
data)
2016 2015
Change
Total company sales $18,247 $18,764 -2.8 % Total company comparable
sales*^ -0.7 % GAAP operating income
-$264
$713 -$977 Non-GAAP operating income* $905 $933 -$28 GAAP
operating income rate -1.5 % 3.8 % NM Non-GAAP operating income
rate* 5.0 % 5.0 % -1 basis point GAAP net income from
continuing operations
-$459
$462
-$921
Non-GAAP net income from continuing operations* $586 $598 -$12
GAAP earnings per share from continuing operations -$0.71
$0.71 NM Non-GAAP earnings per diluted share from continuing
operations* $0.90 $0.93
-3 %
*Indicates a non-GAAP measure. Refer to
“Presentation of Non-GAAP Information” and the accompanying
reconciliations for more detailed information about these non-GAAP
measures.
^Total company comparable sales excludes
the impact of acquisitions, divestitures, store closures and
foreign currency translation.
For the full year 2016, total company sales decreased three
percent to $18.2 billion compared to full year 2015. Total company
comparable sales declined one percent versus the prior year.
On a GAAP basis, the company reported a net loss from continuing
operations of $459 million, or $0.71 per share, compared to net
income of $462 million, or $0.71 per diluted share, in the full
year 2015. On a non-GAAP basis, the company reported net income
from continuing operations of $586 million, or $0.90 per diluted
share, during 2016, compared to $598 million, or $0.93 per diluted
share, during the prior year.
New Segment Reporting StructureThe company changed its
business segments during the fourth quarter of 2016 to align with
its 20/20 strategic plan, and reflect its priorities to accelerate
growth in North American Delivery and preserve profit in North
American Retail. Under the new structure, the North American
Delivery segment includes Staples Business Advantage, staples.com,
staples.ca and quill.com. The North American Retail segment
includes the company’s retail stores in the U.S. and Canada. The
company’s European results are presented as discontinued
operations, and its remaining results of operations outside of
North America are presented as a reconciling item in the company’s
segment reporting. For comparability, 2015 and 2016 quarterly
results have been recast to align with the company’s new structure
and can be accessed on the company’s investor relations website at
investor.staples.com.
North American Delivery
Fourth
Quarter Full Year (dollar amounts in millions)
2016 2015 Change 2016 2015
Change Sales $2,649 $2,680 -1.2 % $10,636 $10,731 -0.9 %
Comparable sales*^ 1 % 1 % Operating income $168 $168 $1 $672 $621
$51 Operating income rate 6.4 % 6.3 %
10 basis points 6.3 % 5.8
% 52 basis points
*Indicates a non-GAAP measure. Refer to
“Presentation of Non-GAAP Information” and the accompanying
reconciliations for more detailed information about these non-GAAP
measures.
^North American Delivery comparable sales
excludes the impact of acquisitions, divestitures and foreign
currency translation.
North American Delivery sales for the fourth quarter of 2016
were $2.6 billion, a decline of one percent compared to the fourth
quarter of 2015. North American Delivery comparable sales grew one
percent compared to the fourth quarter of 2015. The improvement in
fourth quarter comparable sales primarily reflects growth in
facilities supplies, computers, and breakroom supplies, partially
offset by declines in tablets, ink and toner and office supplies.
Staples Business Advantage sales were about flat on a GAAP basis
and comparable sales increased four percent versus the fourth
quarter of 2015.
Operating income rate increased 10 basis points to 6.4 percent
compared to the fourth quarter of 2015. This improvement primarily
reflects increased product margin rate. This was partially offset
by increased incentive compensation expense, supply chain costs,
and marketing expense.
North American Retail
Fourth
Quarter Full Year (dollar amounts in millions)
2016 2015 Change 2016 2015
Change Sales $1,649 $1,797 -8.2 % $6,662 $7,169 -7.1 %
Comparable store sales -7 % -5 % Operating income $99 $106
-$7 $317 $379 -$62 Operating income rate 6.0 %
5.9 % 11 basis points 4.8 %
5.3 % -52 basis points
North American Retail sales for the fourth quarter of 2016 were
$1.6 billion, a decrease of eight percent compared to the fourth
quarter of 2015. Store closures negatively impacted fourth quarter
2016 sales growth by approximately two percent. Comparable store
sales decreased seven percent versus the prior year. Sales declines
in mobility, business machines, technology accessories, and ink and
toner were partially offset by growth in print and marketing
services.
Operating income rate increased 11 basis points to 6.0 percent
compared to the fourth quarter of 2015. This primarily reflects
increased product margin rate. This was partially offset by
increased incentive compensation expense and the negative impact of
lower sales on fixed expenses.
The company closed 13 stores during the fourth quarter of 2016
and 48 stores for the full year in North America and ended the year
with 1,255 stores in the U.S. and 304 stores in Canada.
Discontinued OperationsDuring the fourth quarter of 2016,
the company completed the sale of its retail business in the United
Kingdom. The company also entered into an agreement to sell a
controlling interest in its remaining European operations during
the fourth quarter of 2016, and completed this sale in February
2017. As a result of these transactions, the results of the
company’s European operations have been classified as discontinued
operations. The company recorded an after-tax loss from
discontinued operations of $337 million in the fourth quarter,
which includes $231 million of pre-tax charges related to
impairment of long-lived assets and a $114 million pre-tax loss on
the sale of the company’s retail business in the United Kingdom.
This compares to an after-tax loss of $44 million from discontinued
operations in the fourth quarter of 2015.
For the full year 2016, the company recorded an after-tax loss
from discontinued operations of $1.0 billion related to its
European businesses, which includes $918 million of charges related
to impairment of goodwill and long-lived assets. This compares to
an after-tax loss from discontinued operations of $83 million
during 2015.
OutlookFor the first quarter of 2017, the company expects
to achieve fully diluted non-GAAP earnings per share from
continuing operations in the range of $0.15 to $0.18. The company’s
earnings guidance excludes potential charges related to the
company’s strategic plans, including restructuring and related
initiatives and the sale of its European operations. For the full
year 2017, the company expects to generate at least $500 million of
free cash flow. The company plans to close approximately 70 stores
in North America in 2017.
Presentation of Non-GAAP InformationThis press release
presents certain results with and without the impairment of
goodwill, restructuring and related charges, long-lived asset
impairment, gains and losses related to the sale of businesses and
assets, costs related to the proposed acquisition of Office Depot,
costs related to litigation and PNI data security incident costs.
This press release also presents certain results both with and
without the impact of acquisitions, divestitures, store closures,
and foreign currency translation. The presentation of these
results, as well as the presentation of free cash flow, are
non-GAAP financial measures that should be considered in addition
to, and should not be considered superior to, or as a substitute
for, the presentation of results determined in accordance with
GAAP. Management believes that the non-GAAP financial measures
assist management and investors to analyze the company’s
performance by providing meaningful information that facilitates
the comparability of underlying business results from period to
period. Management uses these non-GAAP financial measures to
evaluate the operating results of the company’s business against
prior year results and its operating plan, and to forecast and
analyze future periods. Management recognizes there are limitations
associated with the use of non-GAAP financial measures as they may
reduce comparability with other companies that use different
methods to calculate similar non-GAAP measures. Management
generally compensates for these limitations by considering GAAP as
well as non-GAAP results. In addition, management provides a
reconciliation to the most comparable GAAP financial measure, other
than financial guidance which is only provided on a non-GAAP basis
given that potential charges to be incurred related to the
company’s strategic plans, including restructuring and related
initiatives, and the potential related impact on cash flow cannot
be reasonably estimated.
Today's Conference CallThe company will host a conference
call today at 8:00 a.m. (ET) to review these results and its
outlook. The webcast of the conference call and accompanying slides
can be accessed on the company’s investor relations website at
investor.staples.com. A replay will also be available on the
company’s investor relations website after the call.
About Staples, Inc.Staples helps small business customers
make more happen by providing a broad assortment of products,
expanded business services and easy ways to shop – in stores,
online via mobile or through social apps. Staples Business
Advantage, the business-to-business division, caters to mid-market,
commercial and enterprise-sized customers by offering a one-source
solution for the products and services they need, combined with
best-in-class customer service, competitive pricing and a
state-of-the-art ecommerce site. Headquartered outside of Boston,
Staples, Inc. operates throughout North and South America, Asia,
Australia and New Zealand. More information about Staples (NASDAQ:
SPLS) is available at www.staples.com.
Safe Harbor for Forward-looking StatementsCertain
information contained in this news release constitutes
forward-looking statements for purposes of the safe harbor
provisions of The Private Securities Litigation Reform Act of 1995
including, but not limited to, the information set forth under
“Outlook” and other statements regarding our future business and
financial performance. Any statements contained in this news
release that are not statements of historical fact should be
considered forward-looking statements. You can identify
forward-looking statements by the use of the words “believes”,
“expects”, “anticipates”, “plans”, “may”, “will”, “would”,
“intends”, “estimates”, and other similar expressions, whether in
the negative or affirmative, although not all forward-looking
statements include such words. Forward-looking statements are based
on a series of expectations, assumptions, estimates and projections
which involve substantial uncertainty and risk, including the
review of our assessments by our outside auditor and changes in
management’s assumptions and projections. Actual results may differ
materially from those indicated by such forward-looking statements
as a result of risks and uncertainties, including but not limited
to our ability to meet the changing needs of our customers; our
ability to successfully transform our business, including that the
investments we plan to make to accelerate growth in our mid-market
contract business may not generate incremental revenue or increase
profitability, in which case the costs of such investments will
adversely affect our future operating results; industry, operating
and competitive pressures and global economic conditions, including
their impact on prices and demand for our products and services,
our financial condition and our results of operations; compromises
of our information security; our ability to retain qualified
employees; risks related to international operations and
fluctuations in foreign exchange rates; changes in our effective
tax rate; the impact of regulation and regulatory, investigative
and legal proceedings and legal compliance risks; and factors
discussed or referenced in our Annual Report on Form 10-K filed on
March 9, 2017 under the heading “Risk Factors” and elsewhere, and
any subsequent periodic or current reports filed by us with the
SEC. In addition, any forward-looking statements represent our
estimates only as of the date such statements are made (unless
another date is indicated) and should not be relied upon as
representing our estimates as of any subsequent date. While we may
elect to update forward-looking statements at some point in the
future, we specifically disclaim any obligation to do so, even if
our estimates change.
STAPLES, INC. AND
SUBSIDIARIES
Condensed Consolidated Balance
Sheets
(Dollar Amounts in Millions, Except
Share Data)
(Unaudited)
January 28, 2017
January 30, 2016 ASSETS Current assets: Cash
and cash equivalents $ 1,137 $ 825 Receivables, net 1,538 1,543
Merchandise inventories, net 1,737 1,791 Prepaid expenses and other
current assets 251 273 Current assets of discontinued operations
568 680
Total current assets 5,231 5,112
Property and equipment, net 1,147 1,286 Intangible
assets, net of accumulated amortization 205 235 Goodwill 1,290
2,032 Other assets 398 497 Noncurrent assets of discontinued
operations — 1,010
Total assets $ 8,271
$ 10,172
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: Accounts payable $ 1,706 $ 1,685
Accrued expenses and other current liabilities 1,023 1,160 Debt
maturing within one year 519 15 Current liabilities of discontinued
operations 402 405
Total current liabilities
3,650 3,265
Long-term debt 529 1,016
Other
long-term obligations 396 441
Noncurrent liabilities of
discontinued operations — 66
Stockholders’
equity: Preferred stock, $.01 par value, 5,000,000 shares
authorized; no shares issued — —
Common stock, $.0006 par value,
2,100,000,000 shares authorized; issued andoutstanding 953,711,270
and 652,470,081 shares at January 28, 2017 and946,964,792 and
645,723,603 shares at January 30, 2016
1 1 Additional paid-in capital 5,067 5,010 Accumulated other
comprehensive loss (1,053 ) (1,116 ) Retained earnings 5,092 6,900
Less: Treasury stock at cost, 301,241,189 shares at January 28,
2017 and January 30, 2016 (5,419 ) (5,419 )
Total Staples, Inc.
stockholders’ equity 3,688 5,376 Noncontrolling interests 8
8
Total stockholders’ equity 3,696
5,384
Total liabilities and stockholders’ equity $
8,271 $ 10,172
STAPLES, INC. AND
SUBSIDIARIES
Condensed Consolidated Statements of
Income
(Amounts in Millions, Except Per Share
Data)
(Unaudited)
13 Weeks Ended 52 Weeks
Ended January 28, 2017 January
30, 2016 January 28, 2017
January 30, 2016 Sales $ 4,560 $ 4,695 $ 18,247 $
18,764 Cost of goods sold and occupancy costs 3,326 3,468
13,489 13,857
Gross profit 1,234 1,227
4,758 4,907
Operating expenses: Selling, general and
administrative 977 988 3,845 3,993 Merger termination fee — — 250 —
Impairment of goodwill and long-lived assets 766 11 783 37
Restructuring charges 21 37 38 105 Amortization of intangibles 13
14 51 54
Total operating
expenses 1,777 1,050 4,967 4,189
Loss on sale of businesses and assets, net (5 ) (7 ) (55 )
(5 )
Operating (loss) income (548 ) 170 (264 ) 713
Other income (expense): Interest income 1 1 6 3
Interest expense (10 ) (49 ) (81 ) (139 ) Loss on early
extinguishment of debt — — (26 ) — Other income (expense), net 8
(4 ) 13 (13 ) (Loss) income from continuing
operations before income taxes (549 ) 118 (352 ) 564 Income tax
expense 66 (12 ) 107 102
(Loss) income from
continuing operations (615 ) 130 (459 ) 462
Discontinued
operations: Pretax income (loss) of discontinued operations 5
(37 ) (700 ) (72 ) Loss recognized on classification as held for
sale (231 ) — (231 ) — Loss on sale (114 ) — (114 ) —
Total pretax loss of discontinued operations (340 ) (37 ) (1,045 )
(72 ) Income tax (benefit) expense (3 ) 7 (7 ) 11
Loss from discontinued operations, net of income taxes (337
) (44 ) (1,038 ) (83 )
Net (loss)
income $ (952 ) $ 86 $ (1,497 ) $ 379
Basic Earnings per share Continuing operations $ (0.94 ) $ 0.20 $
(0.71 ) $ 0.71 Discontinued operations (0.52 ) (0.07 ) (1.60 )
(0.12 ) Consolidated operations $ (1.46 ) $ 0.13 $ (2.31 ) $
0.59 Diluted Earnings per Share: Continuing operations $
(0.94 ) $ 0.20 $ (0.71 ) $ 0.71 Discontinued operations $ (0.52 )
(0.07 ) (1.60 ) (0.12 ) Consolidated operations $ (1.46 ) $ 0.13
$ (2.31 ) $ 0.59 Dividends declared per common
share $ 0.12 $ 0.12 $ 0.48 $ 0.48
STAPLES, INC. AND SUBSIDIARIES Consolidated
Statements of Comprehensive Income (Amounts in Millions)
13 Weeks Ended January 28, 2017
January 30, 2016 Consolidated
comprehensive (loss) income $ (909 ) $ 83
52
Weeks Ended January 28, 2017 January 30, 2016
Consolidated net (loss) income $ (1,497 ) $ 379
Other comprehensive income (loss), net of tax: Foreign
currency translation adjustments 25 (132 ) Disposal of foreign
business, net 6 — Settlements and curtailments of pension and other
post-retirement obligations 23 — Deferred pension and other
post-retirement benefit costs, net 9 57 Other
comprehensive income (loss), net of tax 63 (75 )
Consolidated comprehensive (loss) income $ (1,434 ) $ 304
STAPLES, INC. AND SUBSIDIARIES Condensed
Consolidated Statements of Cash Flows (Amounts in
Millions) (Unaudited) 52 Weeks Ended
January 28, 2017 January 30, 2016 Operating
Activities: Net (loss) income $ (1,497 ) $ 379 Adjustments to
reconcile net (loss) income to net cash provided by operating
activities: Depreciation 378 388 Amortization of intangibles 58 67
Loss on sale of businesses and assets, net 168 5 Interest and fees
paid from restricted cash account, net 66 — Impairment of goodwill
and long-lived assets 1,700 50 Inventory write-downs related to
restructuring activities — 1 Stock-based compensation 61 63 Excess
tax benefits from stock-based compensation arrangements — (5 )
Deferred income tax expense 57 28 Other 19 11 Changes in assets and
liabilities: Decrease (increase) in receivables 21 (19 ) Decrease
in merchandise inventories 63 18 Decrease (increase) in prepaid
expenses and other assets 34 (41 ) Increase in accounts payable 4
63 (Decrease) increase in accrued expenses and other liabilities
(140 ) 110 Decrease in other long-term obligations (58 ) (140 )
Net cash provided by operating activities 934 978
Investing Activities: Acquisition of property and equipment
(255 ) (381 ) Proceeds from the sale of property and equipment 14
27 Sale of businesses, net 55 2 Increase in restricted cash (66 ) —
Acquisition of businesses, net of cash acquired (44 ) (22 ) Cost
method investments (15 ) —
Net cash used in investing
activities (311 ) (374 )
Financing Activities:
Proceeds from the exercise of stock options and sale of stock under
employee stock purchase plans 30 41 Proceeds from borrowings 187 7
Payments on borrowings, including payment of deferred financing
fees and capital lease obligations (211 ) (99 ) Cash dividends paid
(311 ) (308 ) Excess tax benefits from stock-based compensation
arrangements — 5 Repurchase of common stock (13 ) (24 )
Net cash
used in financing activities (318 ) (378 ) Effect of exchange
rate changes on cash and cash equivalents 7 (28 )
Net
increase in cash and cash equivalents 312 198 Cash and cash
equivalents at beginning of period 825 627
Cash
and cash equivalents at the end of the period $ 1,137 $
825
STAPLES, INC. AND SUBSIDIARIES Segment
Reporting (Amounts in Millions) (Unaudited)
13 Weeks Ended 52
Weeks Ended January 28, 2017 January
30, 2016 January 28, 2017 January 30,
2016 Sales North American Delivery $ 2,649 $ 2,680 $
10,636 $ 10,731 North American Retail 1,649 1,797 6,662 7,169 Other
262 218 949 864 Total sales $ 4,560
$ 4,695 $ 18,247 $ 18,764
Business Unit Income (Loss) North American Delivery $ 168 $
168 $ 672 $ 621 North American Retail 99 106 317 379 Other (2 ) (3
) (11 ) (16 ) Total business unit income 265 271 978 984
Unallocated expense (22 ) (10 ) (73 ) (49 ) Impairment of goodwill
and long-lived assets (766 ) (11 ) (783 ) (37 ) Loss related to
sale of businesses and assets, net (5 ) (7 ) (55 ) (5 )
Restructuring charges and costs related to strategic plans (23 )
(37 ) (45 ) (105 ) Interest and other expense, net (1 ) (52 ) (88 )
(149 ) Merger-related costs — (20 ) (272 ) (53 ) Litigation costs 3
— (14 ) — Inventory write-downs — — — (1 ) Accelerated depreciation
— — — (3 ) PNI data security incident costs — (16 ) —
(18 ) (Loss) income from continuing operations before income taxes
$ (549 ) $ 118 $ (352 ) $ 564
STAPLES, INC.
AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Income
Statement Disclosures (Dollar Amounts in Millions, Except
Per Share Data) (Unaudited)
For the non-GAAP measures related to
results of operations, reconciliations to the most directly
comparable GAAP measures are shown below:
13 Weeks Ended January 28, 2017
GAAP Impairment of goodwill and long-lived
assets Loss on sale of businesses and assets,
net Costs related to restructuring and
strategic plans Litigation
Non-GAAP Operating (loss) income
$ (548 ) $ 766 $ 5 $ 23 $ (3 ) $ 243 Interest and other expense,
net 1 — — — $ — 1 (Loss) income from continuing
operations before income taxes (549 ) 242 Income tax expense
66 66 Adjustments — 15 Adjusted income tax expense 66
81 (Loss) income from continuing operations $ (615 )
$ 161 Effective tax rate (12.0 )% 33.5 %
(Loss) income from continuing operations per common share: Diluted
earnings per common share $ (0.94 ) $ 0.25
52 Weeks
Ended January 28, 2017 GAAP Impairment
of goodwill and long-lived assets Merger-related
costs Loss on sale of businesses and assets, net
Litigation Costs related to restructuring
and strategic plans Non-GAAP Gross profit $ 4,758
$ — $ — $ — $ — $ 4 $ 4,762 Operating (loss)
income (264 ) 783 272 55 14 45 905 Interest and other expense, net
62 (37 ) 25 Loss on early extinguishment of debt 26 (26 ) —
(Loss) income from continuing operations before income taxes
(352 ) 880 Income tax expense 107 107 Adjustments —
187 Adjusted income tax expense 107 294 (Loss)
income from continuing operations $ (459 ) $ 586
Effective tax rate (30.5 )% 33.5 % (Loss) income from
continuing operations per common share: Diluted earnings per common
share $ (0.71 ) $ 0.90 Weighted average common shares
outstanding 649 649 Effect of dilutive securities — 4
Weighted average common shares outstanding assuming dilution 649
653
13 Weeks Ended January 30, 2016
GAAP Restructuring charges Loss on
sale of businesses and assets, net Impairment of long
lived assets Merger-related costs PNI
data security incident costs Non-GAAP Operating
income $ 170 $ 37 $ 7 $ 11 $ 20 $ 16 $ 261 Interest and
other expense, net 52 — — — (38 ) — 14 Income from
continuing operations before income taxes 118 247 Income tax
benefit (12 ) (12 ) Adjustments — 91 Adjusted income
tax expense (12 ) 79 Income from continuing
operations $ 130 $ 168 Effective tax rate
(10.7 )% 31.8 % Income from continuing operations per common
share: Diluted earnings per common share $ 0.20 $ 0.26
52
Weeks Ended January 30, 2016 GAAP
Restructuring charges Impairment of long-lived
assets and accelerated depreciation Loss on sale of
assets, net Merger-related costs PNI
data security incident costs Non-GAAP Operating
income $ 713 $ 105 $ 39 $ 5 $ 53 $ 18 $ 933 Interest and other
expense, net 149 — — — 94 — 55 Income from continuing
operations before income taxes 564 878 Income taxes 102 102
Adjustments — 178 Adjusted income taxes 102 280
Income from continuing operations $ 462 $ 598
Effective tax rate 18.1 % 31.8 % Income from
continuing operations per common share: Diluted earnings per common
share $ 0.71 $ 0.93
Note that certain percentage figures shown in the tables above
may not recalculate due to rounding.
STAPLES, INC. AND SUBSIDIARIES Reconciliation of
GAAP to Non-GAAP Sales Growth (Unaudited)
Total Company Comparable Sales Growth
Fourth quarter of Fiscal 2016 Fiscal Year 2016
GAAP sales growth (2.9 )% (2.8 )% Impact of foreign exchange 0.3 %
(0.4 )% Impact of store closures (0.8 )% (0.8 )% Impact of
acquisitions and divestitures (1.5 )% (0.9 )% Comparable sales
growth (0.9 )% (0.7 )%
North American Delivery Comparable Sales
Growth Fourth quarter of Fiscal
2016 Fiscal Year 2016 GAAP sales growth (1.2 )% (0.9 )%
Impact of foreign exchange 0.2 % (0.1 )% Impact of divestitures
(3.5 )% (2.0 )% Impact of acquisitions 0.9 % 0.3 % Comparable sales
growth 1.2 % 0.9 %
Staples Business Advantage Comparable Sales
Growth Fourth quarter of Fiscal 2016 GAAP
sales growth (0.2 )% Impact of foreign exchange 0.2 % Impact of
divestitures (5.3 )% Impact of acquisitions 1.3 % Comparable sales
growth 3.6 %
STAPLES, INC. AND SUBSIDIARIES
Reconciliation of Free Cash Flow Disclosures (Amounts in
Millions) (Unaudited) 52 Weeks
Ended January 28, 2017 January 30, 2016
Net cash provided by operating activities $ 934 $ 978 Acquisition
of property and equipment (255 ) (381 ) Free cash flow $ 679 $ 597
Financing and break-up fees related to acquisition of Office Depot,
net of taxes 210 — Adjusted free cash flow $ 889
$ 597
Free cash flow is not defined under U.S.
GAAP. Therefore, it should not be considered a substitute for
income or cash flow data prepared in accordance with GAAP and may
not be comparable to similarly titled measures used by other
companies. The company defines free cash flow as net cash provided
by operating activities less capital expenditures. It should not be
inferred that the entire free cash flow amount is available for
discretionary expenditures. The company believes free cash flow is
a useful measure of performance and uses this measure as an
indication of the company's ability to generate cash and invest in
its business.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170309005566/en/
Staples, Inc.Media Contact:Bill Durling,
508-253-2882orInvestor Contact:Chris Powers/Scott Tilghman,
508-253-4632/1487
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Staples, Inc. (NASDAQ:SPLS)
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From Sep 2023 to Sep 2024