United Stationers 4Q sales fall, but earnings up
Deerfield-based United Stationers reported its fourth quarter 2013 earnings per share increased 6.2 percent over the same period last year, despite a 1.6 percent decrease in sales.
Net income was $34.1 million, or 85 cents per share, compared with $32.9 million, or 81 cents per share, in 2012. The results include a non-deductible asset impairment charge of $1.2 million, or 3 cents per share, related to the company's investment in a managed print services business and a benefit of $1.3 million, or 2 cents per share, from a partial reversal of the workforce reduction and facility closure charge taken in the first quarter of 2013.
Sales decreased 1.6 percent to $1.22 billion from $1.24 billion, as growth in janitorial/breakroom and industrial products was offset by a decline in office products categories. Industrial supply sales increased 10.8 percent to $124.3 million from $112.3 million, largely driven by the O.K.I. Supply acquisition. Sales in janitorial/breakroom supplies rose 7.1 percent to $332.8 million from $310.7 million. Technology sales declined 11.1 percent to $346.4 million from $389.4 million.
Traditional office products sales declined 2.6 percent to $310.9 million from $319.3 million in 2012. Furniture sales decreased 4.5 percent to $72.9 million from $76.4 million in the prior year.
Fourth quarter operating income was $57.6 million, or 4.7 percent of sales, while fourth quarter operating expenses were 11.3 percent of sales versus 11.8 percent in 2012
Fourth quarter gross profit was $195.5 million, down from $201.7 million in 2012. The decline resulted from higher freight costs and an increase in inventory-related costs, but was was partially offset by improved product margin, including inventory purchase-related supplier allowances.
Gross margin was 16 percent compared with a record 16.2 percent in the prior year.
"I'm pleased with our overall performance in the quarter and for the full year. We made significant progress executing our diversification strategy, expanded our margins, and managed our costs in a weak demand environment," said United Stationers President and CEO Cody Phipps. "We continued to make strategic investments in our business, such as the O.K.I. acquisition and e-business capabilities. Our strategy is working and we are positioned well in the market place with both manufacturers and resellers as we enter 2014,"