Office Depot (NASDAQ: ODP) reported Q3 EPS of $0.13, $0.01 better than the analyst estimate of $0.12. Revenue for the quarter came in at $2.89 billion versus the consensus estimate of $2.83 billion.

• Reported Sales of $2.9 Billion, Up 10%
  • Business Solutions Division (BSD) Sales Up 6%; Up 1% Organically
  • Service Revenues up 28% in BSD and up 11% in Retail Division(1)
  • Retail sales down 6%; down 5% adjusted for new revenue recognition standard
• Operating Income of $105 Million Flat versus Prior Year, despite Disappointing Performance at CompuCom
• Operating Cash Flow of $304 Million; $555 Million Year-to-Date
• Free Cash Flow of $257 Million; $434 Million Year-to-Date
• Ending Cash Balance of $925 Million
• Raising 2018 Guidance and Issuing Guidance for 2019

OUTLOOK

“Throughout the year, we’ve made excellent progress to reverse historic trends and regain traction in sales growth, beating on all key measures versus the original guidance we set at the beginning of the year,” said Smith. “Our incremental top-line revenue growth this year has been driven by organic sales increases in our BSD division and improving sales trends in our retail division. For 2018, we now expect to exceed our guidance for total sales, as well as reaffirm our guidance for adjusted operating income. Also, our operational discipline and focus on working capital initiatives have enabled us to generate $434 million in Free Cash Flow year to date, surpassing our guidance for the year. We now expect to approximate $450 million in Free Cash Flow by year end. We are also providing guidancefor 2018 Adjusted EBITDA, an operating metric we watch closely and a measure our investors frequently request,” he added.

GUIDANCE:

Office Depot sees FY2018 revenue of $11 billion, versus the consensus of $10.92 billion.

Office Depot sees FY2019 revenue of $11.1 billion, versus the consensus of $10.79 billion.

For earnings history and earnings-related data on Office Depot (ODP) click here.