Helped by tighter expense control, Office Depot (ODP) revealed a narrowed fourth-quarter loss ahead of Wall Street estimates, a positive sign just weeks after the company unveiled its overhaul initiatives.
The Boca Raton, Fla.-based company posted a net loss of $58 million, or 21 cents a share, compared with a loss of $77 million, or 28 cents a share, in the same quarter last year.
Office Depot’s results have suffered under ailing demand and rising costs, which led the company to launch a restructuring plan in the fourth-quarter of 2010. Excluding one-time restructuring charges, the company earned a quarterly profit of 9 cents, trumping average analyst estimates polled by Thomson Reuters of a 3-cent loss.
“Our fourth quarter operating results were stronger than we anticipated, excluding the charges,” said Office Depot interim CEO Neil Austrian. “We are taking the necessary steps to improve the future operating performance of this company.”
Revenue for the office products and services retailer was $2.96 billion, down 3% from a year ago, matching the Street’s view. Sales took a hit by lower demand in its North American retail and business solutions divisions and its international business, hurt by lower customer transaction counts in business solutions and lower comparable store sales.
Cushioning the earnings were lower costs of goods sold and occupancy expenses, which decreased to $2.1 billion from $2.21 billion a year ago.
Last week, the office supplier said it would buy Svanstroms Gruppen, a Swedish office supply company, in an effort to strengthen its position in the Nordic regions and continue growth of its European operations.