Staples: Shares Drop as Earnings Miss

European sales fall sharply while North America stays flat

   

Staples: Shares Drop as Earnings Miss

Staples (NASDAQ:SPLS) announced Wednesday morning that its fiscal first-quarter earnings dropped 5.6% to $187.1 million, down from $198.2 million during the same time last year. EPS was 29 cents a share for the quarter, down a penny from 28 cents in 2011.

Sales edged lower to $6.1 billion, down 1.1% from last year, mostly due to declining sales in Europe.

The results disappointed analysts who had predicted EPS of 30 cents on sales of $6.18 billion, according to Thomson Reuters.

Investors weren’t pleased with the results either. Staples’ shares tumbled more than 6% in Wednesday afternoon trading.

Falling sales in Europe sent the company’s international sales down 8% to $1.23 billion. North American sales were flat at $2.32 billion, as were same-store North American sales. European same-store sales fell 6%.

International sales account for 20% of Staples overall sales. The company’s gross margin slipped to 26.4% from 26.5%.

CEO Ron Sargent said the company was moving to address declining overseas results.

Staples announced 300 job cuts in its European and Australian operations during the first quarter.


Article printed from InvestorPlace Media, http://investorplace.com/2012/05/staples-shares-drop-as-earnings-miss/.

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