U.S. – Office Depot, Inc., a leading omni-channel provider of business services and supplies, products and technology solutions, announced results for the second quarter ended June 30, 2018. Total sales for 2Q-2018 were USD 2.6 billion compared to USD 2.4 billion in the second quarter of 2017, an increase of 11%.

In the second quarter of 2018, Office Depot reported operating income of USD 48 million and net income from continuing operations was USD 19 million, compared to operating income of USD 41 million and net income from continuing operations of USD 21 million in the second quarter of 2017.

Office Depot’s Retail Division reported sales of USD 1.1 billion in the second quarter of 2018, down 5% versus the prior year period. Planned store closures and an approximately USD 10 million negative impact to revenue resulting from the adoption of the new revenue recognition standard contributed to the decline. Product sales in the second quarter declined 7%, while services revenue increased 12% compared to the prior year period, excluding the revenue recognition impact. Comparable sales declined 2% versus the prior year, primarily driven by fewer transactions and lower average order values.

Retail Division operating income was USD 22 million in the second quarter of 2018, compared to USD 20 million in the second quarter of 2017. The increase in operating income versus the prior year was primarily due to the positive impact of ongoing efficiency and cost reduction initiatives. During the second quarter of 2018, the Company closed 2 stores and ended the quarter with a total of 1,374 stores in the Retail Division.

“I am extremely pleased with our performance in the second quarter as the execution of our strategy is driving improved sales trends across all three of our operating divisions,” said Gerry Smith, chief executive officer of Office Depot. “Sales in the Business Solutions Division were up an impressive 4% in the quarter driven by our acquisition strategy and growth in the adjacency categories beyond office products. I’m also encouraged by the early success of our initiatives to increase services, which now represent 16% of total sales. In addition to the sales performance, our efficiency and cost control initiatives allowed us to deliver an increase in year-over-year operating income and cash flow for the Company in the quarter. I’m confident that we have the right strategy in place to grow the business long term and we have assembled a talented and dedicated team that is focused on driving continued execution across the enterprise.”