Office equipment and products retailer Office Depot, Inc. (Delray Beach, Florida, U.S.) said today that total company sales for first quarter 2007 grew 7 percent to U.S. $4.1 billion compared to the first quarter of 2006. Sales in North America were up 3 percent, while International sales increased 21 percent in U.S. dollars and 11 percent in local currencies. Sales in North America during the first quarter were depressed early in the quarter by the launch of the Microsoft® Windows Vista™ operating system and the related lack of available PC inventory, and later in the quarter by a softening in spending by small business customers.
In the first quarter period, ended March 31, 2007, the retailer reported net earnings of $156 million compared to $130 million in the same quarter of the prior year. Diluted earnings per share were $0.56 in the first quarter of 2007 versus $0.43 in the same period a year ago. Excluding charges, net earnings as adjusted increased to $168 million in the first quarter of 2007 from $144 million in 2006. Diluted earnings per share as adjusted increased 25 percent to $0.60 in the first quarter of 2007 from $0.48 in the same period last year.
“We are pleased that we have a business model that generates profitable growth even in a challenging quarter,” said Steve Odland, Office Depot’s Chairman and CEO. “The strategic initiatives that we have implemented have led to sales growth in each of our Divisions as well as lower operating expenses and expanded total company margins. This overall growth in sales and operating margin expansion was realized despite disruption in supply caused by the release of Microsoft® Windows Vista™ at the end of January and a softening in small business spending during the quarter. Sales in the second quarter may be similarly affected if the current business conditions persist in North America. However, we will continue to manage our business to optimize profitable growth.”
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