First Quarter 2019 Results
Office Depot announced their Q1 Financial Results on May 8, 2019. The results were disappointing and have lead Office Depot to decrease their sales numbers from their 2019 Guidance. “Our first quarter results were disappointing driven primarily by poor performance at our CompuCom division,” said Gerry Smith, chief executive officer of Office Depot. “We are taking decisive actions and making numerous improvements in our sales and operational processes to place this business back on-target with its long-term expectations. We delivered top-line results in our core BSD and Retail divisions in-line with expectations, supported by strong service revenue growth of 13% and 16%, respectively, in these divisions. ” Smith continued. “As a means to accelerate our transformation, enhance our profitability and fund future growth initiatives, our Board of Directors formally approved earlier [that] week our Business Acceleration Program.” he added.

Highlights

  • Reported Sales of $2.8 Billion, down 2% from Prior Year Period
  • BSD Division Revenue up 1%
  • Retail Division Same Store Sales down 4%
  • CompuCom Revenue down 4%
  • Services Revenue Growth in BSD and Retail Divisions up 13% and up 16%, Respectively
  • Operating Income of $24 Million and Net Income from Continuing Operations of $8 Million
  • Adjusted Operating Income of $67 Million Primarily Driven by Lower Performance at CompuCom
  • Announces Business Acceleration Program to Improve Profitability and Enable Growth Investments
  • Updates 2019 Guidance

Source: Office Depot


New Management
Office Depot has announced two new members of their Executive Leadership Team, Stephen M. Mohan, and Richard Haas. On May 13, 2019 Stephen M. Mohan took the role of Vice President of the Business Solutions Division. Mohan, will be responsible for accelerating growth of B2B sales across all customer segments and vertical markets. Additionally, he will provide day-to-day leadership and management to the contract sales function and help develop and implement short- and long-term initiatives that accelerate business results for BSD. Richard Hass will take on his new role as the Senior Vice President and Chief Accounting Officer on June 14, 2019. Haas will lead and direct the activities of General Accounting, Financial Services, Financial Systems, External Reporting, Tax and Sox Compliance for the company. Haas has served as Office Depot’s Vice President of Tax since January 2014, providing leadership and oversight for all tax matters. 

Source: Office Depot

Source: Office Depot

Strategic Collaboration with Alibaba.com
Office Depot and Alibaba.com have launched a new online destination, www.alibaba.com/officedepot. This is a strategic collaboration with a goal to empower U.S. small- and medium-sized businesses (SMBs) to grow by tapping into the global B2B e-commerce marketplace. Office Depot brings relationships with over 10 million businesses and Alibaba.com brings a global network of over 150,000 suppliers. Both companies are investing in marketing to increase adoption of this new platform. After the initial launch the companies intent to further their collaboration with faster, more transparent and cost-effective distribution and fulfillment as well as a new new sales channel for US SMBs. 

Source: Office Depot