Updated from 8:23 a.m. EDT
In its latest forecast,
can see all the way to China.
In announcing a 39% increase in second-quarter profit and higher full-year guidance Tuesday, the office-supply giant also said it planned to expand into China.
Staples posted net income of $122.5 million, or 24 cents a share, vs. $87.8 million, or 18 cents a share, in the year-ago period. The consensus estimate was for 22 cents a share, according to Thomson First Call.
Revenue increased 9% to $3.09 billion. Sales in Europe grew 15% to $409 million, thanks partly to the weak dollar. Same-store sales rose 4%.
"Our operating performance and strong cash flow have allowed us to invest in our core business and have given us the flexibility and resources to invest in new profitable growth ideas that will drive our business several years down the road," the company said.
The company said its joint venture with OA365, a Chinese Internet and catalog delivery business, gives it "an attractive platform to address the fastest growing market in the world, and the opportunity to increase its investment over time." Staples also announced two small acquisitions to its European delivery operations.
Looking ahead to the third quarter of 2004, Staples said it expects 20% earnings growth, in line with average analyst estimates. The consensus EPS forecast is 40 cents. The retailer also expects to achieve high single-digit sales growth. For the full year, the company raised its profit forecast, predicting 24% earnings growth. Previously, it forecast 20% growth. The consensus forecast is for $1.37 a share.
In May, Staples reported a 12% increase in first-quarter revenue, easily beating analysts' forecasts. The Framingham, Mass.-based company had net income of $125.7 million for the quarter, or 25 cents a share, on revenue of $3.45 billion, vs. $24.8 million, or 5 cents a share, on revenue of $3.09 billion a year ago.
Staples had record full-year 2003 results and said it would pay its first-ever stock dividend this year.
Shares rose 99 cents, or 3.5%, to $28.87.