Office Depot (ODP) has reported 152.17 percent jump in profit for the quarter ended Apr. 01, 2017. The company has earned $116 million, or $0.22 a share in the quarter, compared with $46 million, or $0.08 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $88 million, or $0.16 a share compared with $69 million or $0.12 a share, a year ago.

Revenue during the quarter dropped 6.95 percent to $2,676 million from $2,876 million in the previous year period. Gross margin for the quarter expanded 36 basis points over the previous year period to 25.22 percent. Total expenses were 95.25 percent of quarterly revenues, down from 97.04 percent for the same period last year. This has led to an improvement of 179 basis points in operating margin to 4.75 percent.

Operating income for the quarter was $127 million, compared with $85 million in the previous year period.

However, the adjusted operating income for the quarter stood at $151 million compared to $124 million in the prior year period. At the same time, adjusted operating margin improved 133 basis points in the quarter to 5.64 percent from 4.31 percent in the last year period.

"I am very pleased that we continued our positive momentum into the new year and delivered a strong earnings performance in the first quarter," said Gerry Smith, chief executive officer of Office Depot. "The company completed its sale of South Korea in late April and also entered into a favorable agreement to sell the operations located in Australia and New Zealand. Going forward, our focus is on executing against our strategic initiatives to grow the North American business."

For financial year 2017, the company forecasts adjusted operating income to be $500 million.                    

The company has spent $22 million cash to meet investing activities during the quarter as against cash outgo of $23 million in the last year period.

The company has spent $38 million cash to carry out financing activities during the quarter as against cash outgo of $26 million in the last year period.

Cash and cash equivalents stood at $744 million as on Apr. 01, 2017, down 15.36 percent or $135 million from $879 million on Mar. 26, 2016.

Working capital declines
Office Depot has witnessed a decline in the working capital over the last year. It stood at $1,078 million as at Apr. 01, 2017, down 21.94 percent or $303 million from $1,381 million on Mar. 26, 2016. Current ratio was at 1.58 as on Apr. 01, 2017, down from 1.60 on Mar. 26, 2016.

Cash conversion cycle (CCC) has decreased to 9 days for the quarter from 53 days for the last year period. Days sales outstanding went down to 32 days for the quarter compared with 36 days for the same period last year.

Days inventory outstanding has decreased to 27 days for the quarter compared with 69 days for the previous year period. At the same time, days payable outstanding went down to 49 days for the quarter from 52 for the same period last year.