OfficeMax cuts costs with reduced store count
NAPERVILLE, Ill. — Following a substantial decline in net income for its fourth quarter, OfficeMax is keeping costs in mind by reducing its retail store count in the upcoming year.
For the next fiscal year, the company said it plans a net reduction in retail store count with up to 35 store closures and one to two store openings in the United States, as well as eight to nine store openings and one to two store closures in Mexico.
Bruce Besanko, EVP, CFO and chief administrative officer of OfficeMax, said, "Sales trends improved in the fourth quarter but remain soft. Consequently, we will continue to streamline our cost structure, enabling us to make strategic investments in initiatives that will jump start growth."
OfficeMax Inc. reported Thursday that net income for the quarter ended Dec. 31 dropped to $2.9 million, from $32.8 million a year earlier.
Sales edged up 3.9% to $1.8 billion in the quarter, but dipped 0.4% to $7.1 billion for the full year. Profit for the year was $32.8 million.
"We closed out a challenging 2011 by continuing to streamline our operations and strengthen the core business," said Ravi Saligram, president and CEO of OfficeMax. "We are making progress in executing the strategic plan we announced in November."
Based on the current environment, OfficeMax anticipates that total company sales for the first quarter will be flat as compared to the first quarter of 2011, including the impact of foreign currency translation. For the full year 2012, OfficeMax anticipates that total company sales will be flat to slightly higher than the prior year, including the projected favorable impact of foreign currency translation in 2012 and excluding the additional week in 2011.