United Stationers reports flat 1Q sales
Deerfield-based United Stationers Inc. said net sales in the first quarter of 2013 were flat as the struggling economy continued to affect sales.
Net sales were $1.25 billion in the quarter, which the company said was similar to the previous period last year when adjusting for workdays. While strong growth was seen in the industrial supplies and janitorial/breakroom categories, the company said those gains were offset by decreased sales in the technology, office products and furniture categories.
First quarter gross margin was $188.5 million or 15.1 percent of sales, up 85 basis points versus the prior-year quarter.
“We made progress on strategic initiatives, and delivered solid results in a difficult demand environment,” said Cody Phipps, president and chief executive officer. “First quarter demand conditions were impacted by corporate and government spending reductions, low inflation and continued weakness in the economy as real jobs growth and small business confidence remain soft.”
Other highlights for the quarter include:
Ÿ Operating expenses were $163.3 million. Adjusted operating expenses were $148.9 million or 11.9 percent of sales, up 66 basis points compared to the adjusted prior-year quarter results.
Ÿ Operating income was $25.2 million. Adjusted operating income was $39.7 million or 3.2 percent, up 19 basis points versus last year’s adjusted first quarter operating income.
Ÿ Net cash used in operating activities for the quarter totaled $13.4 million versus net cash provided in operating activities of $27.9 million in the prior-year quarter.
“While we have responded to a difficult economy by taking cost reduction actions in the near-term, we have not lost sight of the importance of investing in the capabilities that will drive our business in the future,” Phipps stated. The first quarter cost actions are expected to result in annual savings in excess of the related charge. These actions will right size United’s business and fund growth initiatives. “Looking forward, we continue to be proactive in taking actions that will positively impact earnings, notwithstanding the uncertain economy that we face. Our efforts remain focused on enabling our supply chain partners to succeed in a rapidly changing environment,” said Phipps.