DOW JONES NEWSWIRES Staples Inc.'s (SPLS) fiscal first-quarter profit rose 5% from the year-earlier period hurt by charges as sales edged up on currency changes. The company lowered its current-year per-share earnings forecast by 15 cents to $1.35 to $1.45, as first-quarter results were weaker than it expected. It expects current-quarter per-share earnings of 18 cents to 20 cents on an unadjusted basis and sales to be "flat to slightly positive." Analysts most recently expected a 25-cent profit and $5.76 billion sales, which represents a 4% increase, according to a Thomson Reuters poll. Such estimates often exclude one-time adjustments and other items. The office-supply giant said its expectations assume "very little improvement in the economy, continued investment in our growth initiatives and competitive pricing in the contract market." Staples has reported improved financial performance of late alongside modest growth in the broader economy. Its results follow smaller rival Office Depot Inc. (ODP) reporting last month it swung to a surprise first-quarter loss amid lower sales. For the quarter ended April 30, Staples posted a profit of $198.2 million, or 28 cents a share, up from $188.8 million, or 26 cents a share, a year earlier. The year-earlier result included 2 cents in integration and restructuring costs. Sales edged up 1.9% to $6.17 billion but were flat on a local currency basis. The company had expected earnings of 30 cents to 32 cents on sales increasing by a low-single-digit percentage. Gross margin narrowed to 26.5% from 26.7%. North American delivery sales, the biggest top-line contributor, increased 2%. North American retail sales edged up 0.7% while international sales rose 3.9%. Shares closed Tuesday at $19.65 and were inactive in recent premarket trading. Through the latest close, the stock is down 14% so far this year. -By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240; matthew.jarzemsky@dowjones.com
