Get All Access for FREEMarket News & Research,
Live Transcripts & Audio,
and a whole lot more…
$SPLS 1Q15 10-Q: At 1Q15-end: Total current assets were $5,381MM, up 3.98% from $5,175MM at 1Q14-end. Total current liabilities were $3,391MM, up 3.03% from $3,291MM at 1Q14-end. Cash and cash equivalents were $795MM, up 26.79% from $627MM at 1Q14-end. Total stockholders’ equity was $5,336MM, up 0.43% from $5,313MM at 1Q14-end.
Sycamore Partners, a private equity firm specializing in consumer and retail investment, has announced that it has completed its acquisition of $SPLS. As a result of completion of the merger, the common stock of Staples will no longer be listed for trading on Nasdaq. Finer details are under wraps.
$SPLS said it grew mid-market sales in Staples Business Advantage, the company's North American contract business, by 11% year-over-year for 2Q17. Improved profitability in North American Retail with operating loss rate down 30 basis points. The company maintained non-GAAP gross profit rate at 25.5%.
$SPLS swung to a profit in 2Q17 from a loss last year, which included merger termination fee and loss on sale of businesses. Net income was $55MM or $0.08 per share compared to a loss of $766MM or $1.18 per share last year. Sales fell to $3.91Bil from $4.03Bil. Non-GAAP EPS declined 8% to $0.12. Comparable sales decreased 1.1%.
$SPLS said Arch Merger Sub has priced an offering of $1Bil in aggregate principal amount of Senior Notes due 2025. Consummation of the offering is expected to occur on Aug. 28, 2017. The proceeds will be used to finance consummation of portion of merger attributable to acquisition of North American Delivery business.
$SPLS said that Arch Merger Sub Inc., a corporation formed by certain ‘funds’ for the proposed acquisition of Staples by such funds, has priced an offering of $1Bil in aggregate principal amount of senior notes due 2025. The notes will be issued at a price of 100% of the aggregate principal amount.
The Federal Trade Commission has granted $SPLS early termination of the waiting period, under the Antitrust Act, in connection with the pending acquisition of the company by investment funds managed by Sycamore Partners. The termination of the waiting period satisfies one of the conditions to the closing of the pending acquisition.
$SPLS entered into definitive agreement to be acquired by investment funds managed by Sycamore Partners for $10.25 per share in cash or about $6.9Bil. $SPLS' BoD unanimously approved the merger agreement and recommends that all $SPLS stockholders vote in favor of the transaction. The transaction is expected to close no later than December 2017.
$SPLS appointed Michelle Bottomley as Chief Marketing Officer (CMO). In this role, Bottomley will be responsible for marketing across $SPLS, helping to promote the company's pivot to focusing on its North American Delivery business. Bottomley replaces former CMO Frank Bifulco, who had previously announced his intention to retire in 2017.
$SPLS stated that the whole strategy for North American Retail is to preserve profitability. The company believes that the strategies it is taking here which include gaining more discipline around promotions and focusing on in-store selling are the right strategies and will enable it to preserve profitability.
$SPLS' Staples 2020 strategy has four priorities which are to accelerate growth in the mid-market in North America, preserve profitability in North American stores while rationalizing excess capacity, take action to drive profit improvement and reduce costs and to narrow the geographic focus to North America. $SPLS made progress on these in 1Q17.
$SPLS expects 2Q17 non-GAAP EPS from continuing operations of $0.10-0.13. The company's earnings guidance reflects continued progress on its cost savings initiatives, offset by investments to accelerate growth in its mid-market contract business and in Pro Categories.
$SPLS posted net loss for 1Q17 of $815MM or $1.24 per share, compared to a profit of $41MM or $0.06 per share last year. Sales declined to $4.15Bil from $4.36Bil. Non-GAAP EPS fell to $0.17 from $0.19. Total company comparable sales for 1Q17 decreased 3%.
$SPLS slipped to a loss in 1Q17 from a profit last year. This is due to discontinued operations from the sale of controlling interest in its European operations, the sale of its businesses in Australia and New Zealand, and pursued the sale of its remaining businesses outside of North America.