While the COVID-19 pandemic has caused a disruption in the business environment, it is also creating more opportunities for us by expanding the nature of our value proposition to customers,” said Smith. Free cash flow is a non-GAAP measure, which we define as cash flows from operating activities less capital expenditures. First quarter 2020 adjusted operating income was $108 million compared to adjusted operating income of $67 million in the first quarter of 2019, an increase of 61%. We also review certain financial measures excluding impacts of transactions that are not related to our core operations (“non-GAAP”). Same store sales were up 2% over the same period last year and sales in our eCommerce channel experienced a significant increase in demand. Office Depot, Inc. (NASDAQ:ODP) is a leading provider of business services and supplies, products and technology solutions to small, medium and enterprise businesses, through an integrated B2B distribution platform of approximately 1,300 stores, online presence, and dedicated sales professionals and technicians. The decrease in operating income versus last year was related to the flow through effect of lower sales, product mix, and higher distribution costs related to the COVID-19 impacts. Consolidated (in millions, except per share amounts), Adjusted earnings per share (most dilutive). Registered Office. Factors that could cause actual results to differ materially from those in the forward-looking statements include, among other things, highly competitive office products market and failure to differentiate Office Depot from other office supply resellers or respond to decline in general office supplies sales or to shifting consumer demands; competitive pressures on Office Depot’s sales and pricing; the risk that Office Depot is unable to transform the business into a service-driven company or that such a strategy will not result in the benefits anticipated; the risk that Office Depot may not be able to realize the anticipated benefits of acquisitions due to unforeseen liabilities, future capital expenditures, expenses, indebtedness and the unanticipated loss of key customers or the inability to achieve expected revenues, synergies, cost savings or financial performance; the risk that Office Depot is unable to successfully maintain a relevant omni-channel experience for its customers; the risk that Office Depot is unable to execute the Business Acceleration Program successfully or that such program will not result in the benefits anticipated; failure to effectively manage Office Depot real estate portfolio; loss of business with government entities, purchasing consortiums, and sole- or limited- source distribution arrangements; failure to attract and retain qualified personnel, including employees in stores, service centers, distribution centers, field and corporate offices and executive management, and the inability to keep supply of skills and resources in balance with customer demand; failure to execute effective advertising efforts and maintain the Office Depot reputation and brand at a high level; disruptions in Office Depot computer systems, including delivery of technology services; breach of Office Depot information technology systems affecting reputation, business partner and customer relationships and operations and resulting in high costs; unanticipated downturns in business relationships with customers or terms with the suppliers, third-party vendors and business partners; disruption of global sourcing activities, evolving foreign trade policy (including tariffs imposed on certain foreign made goods); exclusive Office Depot branded products are subject to additional product, supply chain and legal risks; product safety and quality concerns of manufacturers’ branded products and services and Office Depot private branded products; covenants in the credit facility; a downgrade in Office Depot credit ratings or a general disruption in the credit markets; incurrence of significant impairment charges; retained responsibility for liabilities of acquired companies; fluctuation in quarterly operating results due to seasonality of Office Depot business; changes in tax laws in jurisdictions where Office Depot operates; increases in wage and benefit costs and changes in labor regulations; changes in the regulatory environment, legal compliance risks and violations of the U.S. Foreign Corrupt Practices Act and other worldwide anti-bribery laws; volatility in Office Depot common stock price; changes in or the elimination of the payment of cash dividends on Office Depot common stock; macroeconomic conditions such as future declines in business or consumer spending; increases in fuel and other commodity prices and the cost of material, energy and other production costs, or unexpected costs that cannot be recouped in product pricing; unexpected claims, charges, litigation, dispute resolutions or settlement expenses; and catastrophic events, including the impact of weather events on Office Depot’s business; the discouragement of lawsuits by shareholders against Office Depot and its directors and officers as a result of the exclusive forum selection of the Court of Chancery, the federal district court for the District of Delaware or other Delaware state courts by Office Depot as the sole and exclusive forum for such lawsuits; and the impact of the COVID-19 pandemic on our business, including on the demand for our and our customers’ products and services, on trade and transport restrictions and generally on our ability to effectively manage the impacts of the COVID-19 pandemic on our business operations. Office Depot (ODP Quick Quote ODP - Free Report) closed at $47.48 in the latest trading session, marking a -0.06% move from the prior day.This change lagged the S&P 500's daily gain of 0.36%. Certain non-GAAP measures are also used for short and long-term incentive programs. This proxy statement and our 2016 Annual Report are available for viewing, printing and downloading at www.proxyvote.com. Compared to the prior year period, product sales in the quarter were relatively flat, while service revenue was down 11% as copy and print services and subscription offerings were negatively impacted by the effects related to the COVID-19 pandemic, including the government-imposed temporary closures of non-essential businesses. Our ability to continue to serve customers during the COVID-19 health crisis helped drive strong operating results and generate $188 million in operating cash flow including $173 million in adjusted free cash flow. The Company’s new $1.3 billion asset-based credit facility matures in April 2025 and replaces the Company’s previous credit facility that was due to expire in May 2021. Office Depot s.r.o. There can be no assurances that Office Depot will realize these expectations or that these beliefs will prove correct, and therefore investors and stakeholders should not place undue reliance on such statements. At The Home Depot, we have three key pillars of focus for our Environmental, Social and Governance (ESG) strategy: Operate Sustainably, Focus on People and Strengthen Communities. Tim.Perrott@officedepot.com, Danny Jovic Charges and credits, pretax for all periods presented include merger and restructuring expenses, net, asset impairments (if any), and executive transition costs (if any). ET by Ciara Linnane Office Depot appoints Scaglione as new CFO So, whatever the day brings, we’ve got your back. Product sales in the first quarter were down 1% relative to the prior year period. The Company experienced strong demand for essential products and services during the first quarter of 2020, which helped drive strong operating results and cash flow generation. As part of that approach, the Company is temporarily suspending its share repurchases and quarterly dividend. However, considering recent supply constraints for essential products and operational disruptions occurring in businesses throughout North America, the Company expects to experience lower revenue in the near term. The year-over-year decrease was due to project-related customer-imposed delays and lower services volumes as the COVID-19 health crisis impacted business operations of certain customers. The decrease in revenue over the same period last year was primarily the result of lower sales in the Retail Division, driven by fewer retail stores in service partially offset by higher same store sales, combined with lower sales in the CompuCom Division and Business Solutions Division (BSD) largely driven by impacts related to the COVID-19 outbreak. The Company will re-evaluate its capital return program when appropriate. Corporate Web Site. By eliminating the term loan in its entirety, the Company expects to save approximately $14 million in annual cash interest expense and $75 million in required annual amortization payments. Average square footage per store (in thousands), Tim Perrott Upon closing of the transaction, the Company borrowed a total of $400 million under the new credit facility. 561-438-4629 Presently, supply constraints for essential cleaning and breakroom products, the closure of a limited number of stores in accordance with social distancing and shelter-in-place protocols, and the reduction of store hours by two hours per day are expected to have a negative impact to sales in the Company’s retail operations in the second quarter of 2020. Adjacency categories, which include cleaning and breakroom supplies, technology, furniture, and copy and print services, grew to 39% of total BSD revenue for the quarter. 1. This inaugural OFR 2012 Annual Report details the progress of the Office in meeting its mission and statutory requirements. Same store sales were up by 2% as the demand for essential products including cleaning and breakroom supplies, technology products, furniture, and work-from-home/learn-from-home enabling products increased significantly since the onset of the global health crisis caused by the COVID-19 outbreak. Notwithstanding the near term challenges, CompuCom’s unique capabilities to support distributed work forces with state of the art technology, and a unique field force of over 6,500 field techs and support personnel, have it well positioned to capitalize on opportunities in this growing area. This decline in service revenues was partially mitigated by a 14% year-over-year increase in service revenue in the BSD Division. The company’s shares closed at $1.75. Any other product or company names mentioned herein are the trademarks of their respective owners. Office Depot to conduct 1-for-10 reverse stock split effective June 30 Jun. The CompuCom Division operating income was $3 million in the first quarter of 2020, compared to a $15 million operating loss in the first quarter of 2019. From basic office supplies, such as printer paper and labels, to office equipment, like file cabinets and stylish office furniture, Office Depot and OfficeMax have the office products you need to get the job done.Maintain a well-stocked office breakroom.Save on printer ink and toner to keep your office efficient and productive. Office Depot reported operating income of $80 million in the first quarter of 2020, compared to $24 million in the prior year period. Our measurement of these non-GAAP financial measures may be different from similarly titled financial measures used by others and therefore may not be comparable. “We have an extremely strong balance sheet that has been further enhanced by refinancing our credit facility and paying off our term loan, which preserves cash and extends our credit facility maturity to 2025. Bratislava, Slovakia. ©2020 Office Depot, Inc. All rights reserved. Please wait while we load the requested 10-K report or click the link below: https://last10k.com/sec-filings/report/800240/000156459020006770/odp-10k_20191228.htm, Office Depot Inc provided additional information to their SEC Filing as exhibits, © 2012 – 2021 Last10K.com All Rights Reserved. This communication may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 2020 Annual Report. These non-GAAP financial measures should not be considered superior to the GAAP measures, but only to clarify some information and assist the reader. This effect resulted in lower sales in our contract channel partially offset by higher sales in our eCommerce channel, as demand increased for certain essential products. We make available, free of charge, on the “Investor Relations” section of our website www.officedepot.com, our annual reports on Form 10-K, quarterly reports on … The Company continues to take actions to improve future operating performance, including increased use of automation and technology to improve service efficiency, simplifying operational structures to improve service velocity, and aligning sales efforts to better serve customers and accelerate cross-selling opportunities. These positive sales drivers were more than offset by lower demand in certain product categories due to a portion of our B2B customers having either paused operations or temporarily transitioned into a remote work environment as a result of restrictions imposed in March 2020 aimed to reduce the spread of COVID-19. “Additionally, I believe our opportunities are evolving as we expand our value proposition to customers, sourcing and distributing a broader set of in-demand products and business support services. Operating income included $16 million in merger and restructuring costs, $8 million of which is associated with restructuring charges related to the Business Acceleration Program (BAP) recognized in the quarter. Adjusted Free Cash Flow is a non-GAAP financial measure and reconciliations from GAAP financial measures can be found in this release. The Company expects near term revenue in its BSD division to be negatively impacted by the business conditions related to the COVID-19 outbreak for the reasons described above. We believe that free cash flow is an important indicator that provides additional perspective on our ability to generate cash to fund our strategy and expand our distribution network. BSD reported sales were $1.3 billion in the first quarter of 2020, down 1% compared to the first quarter of 2019. AURELIUS ANNUAL REPORT I 7 Home REPORT OF THE SUPERVISORY BOARD In financial year 2019, the Supervisory Board duly carried out the tasks within its remit, as is its duty in accordance with the law and the Articles of Association and by-laws. “Our strong financial position and focus on utilizing our B2B platform to provide essential products and services are critical to helping our customers manage the challenges related to this crisis,” said Smith. Office Depot reported operating income of $80 million in the first quarter of 2020, compared to $24 million in the prior year period. Danny.Jovic@officedepot.com. We are implementing several strategies to address and hopefully mitigate these challenges including utilizing our global sourcing capabilities to secure additional sources of essential products and supplies, including PPE, and providing technology support, facilitating work from home and virtual learning environments, and continuing efforts to drive a low cost business model. Create an account, Consolidated Statements Of Comprehensive Income (Loss), Consolidated Statements Of Comprehensive Income (Loss) (Parenthetical), Consolidated Balance Sheets (Parenthetical), Consolidated Statements Of Stockholders' Equity, Consolidated Statements Of Stockholders' Equity (Parenthetical), Summary Of Significant Accounting Policies, Summary Of Significant Accounting Policies (Policies), Merger And Restructuring Activity (Tables), Goodwill And Other Intangible Assets (Tables), Quarterly Financial Data (Unaudited) (Tables), Summary Of Significant Accounting Policies - Additional Information (Detail), Acquisitions - Additional Information (Detail), Summary Of Major Components Of Merger And Restructuring Expenses, Net (Detail), Merger And Restructuring Activity - Additional Information (Detail), Severance And Facility Closure Costs (Detail), Summary Of Disaggregated Revenue By Division, Major Product And Service Categories (Detail), Revenue Recognition - Additional Information (Detail), Summary Of Receivables, Contract Assets And Contract Liabilities From Contracts With Customers (Detail), Segment Information - Additional Information (Detail), Reconciliation Of Measure Of Division Operating Income To Consolidated Income Before Income Taxes (Detail), Schedule Of Components Of Income From Continuing Operations Before Income Taxes (Detail), Schedule Income Tax Expense Related To Income From Continuing Operations (Detail), Reconciliation Of Income Taxes At Federal Statutory Rate To Provision For Income Taxes (Detail), Income Taxes - Additional Information (Detail), Schedule Of Components Of Deferred Income Tax Assets And Liabilities (Detail), Summary Of Activity Related To Unrecognized Tax Benefit (Detail), Calculation Of Net Earnings Per Common Share (Detail), Earnings Per Share - Additional Information (Detail), Schedule Of Property And Equipment (Detail), Schedule Of Assets Held Under Finance Leases (Detail), Property And Equipment - Additional Information (Detail), Estimated Future Amortization Expense Related To Capitalized Software (Detail), Goodwill And Other Intangible Assets - Additional Information (Detail), Definite Lived Intangible Assets Included In Other Intangible Assets Net (Detail), Estimated Future Amortization Expense For Intangible Assets (Detail), Timber Notes/Non-Recourse Debt - Additional Information (Detail), Schedule Of Debt (Parenthetical) (Detail), Schedule Of Maturities Of Recourse Debt, Finance Lease And Other Financing Obligations (Detail), Supplemental Cash Flow Information Related To Leases (Detail), Supplemental Balance Sheet Information Related To Leases (Detail), Schedule Of Maturities Of Lease Liabilities Under Operating And Finance Leases (Detail), Schedule Of Maturities Of Lease Liabilities Under Operating And Finance Leases (Parenthetical) (Detail), Future Minimum Lease Payments Due Under Non-Cancelable Portions Of Leases (Detail), Stockholders' Equity - Additional Information (Detail), Accumulated Other Comprehensive Loss Activity, Net Of Tax (Detail), Stock-Based Compensation - Additional Information (Detail), Summary Of Status Of Nonvested Shares (Detail), Summary Of The Activity In The Performance-Based Long-Term Incentive Program Since Inception (Detail), Changes In Pension And Other Postretirement Benefit Obligations, Plan Assets And Funded Status (Detail), Amounts Recognized In Consolidated Balance Sheets Related To Defined Benefit Pension And Other Postretirement Benefit Plans (Detail), Components Of Net Periodic Pension Cost (Benefit) (Detail), Other Changes In Plan Assets And Benefit Obligations Recognized In Other Comprehensive Loss (Income) (Detail), Employee Benefit Plans - Additional Information (Detail), Weighted Average Assumptions Used In The Measurement Of Benefit Obligations (Detail), Weighted Average Assumptions Used In The Measurement Of Net Periodic Benefit Cost (Detail), Assumed Healthcare Cost Trend Rates (Detail), Allocation Of Pension Plan Assets By Category (Detail), Fair Value Of Pension Plan Assets (Detail), Estimated Future Benefit Payments (Detail), Schedule Of Reconciliation Of Changes In Projected Benefit Obligation, Fair Value Of Plan Assets And Funded Status Of Plan (Detail), Components Of Net Periodic Pension (Benefit) Cost (Detail), Assumptions Used In Calculating Funded Status (Detail), Reconciliation Of The Change In Fair Value Of The Pension Plan Assets Calculated Based On Level 3 Inputs (Detail), Fair Value Measurements - Additional Information (Detail), Schedule Of Fair Value Of Assets And Liabilities (Detail), Schedule Of Fair Value Of Assets And Liabilities (Parenthetical) (Detail), Commitments And Contingencies - Additional Information (Detail), Discontinued Operations - Additional Information (Detail), Major Component Of Discontinued Operations, Net Of Tax (Detail), Schedule Of Quarterly Financial Data (Detail), Schedule Of Quarterly Financial Data (Parenthetical) (Detail), Exhibit 4.2: Instruments Defining The Rights Of Security Holders, Including Indentures, Exhibit 21: Subsidaries Of The Registrant, Exhibit 23.1: Consents Of Experts And Counsel, Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification, https://last10k.com/sec-filings/odp/0001564590-20-006770.htm. 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