BOCA RATON, FLA. — Office Depot plans to close at least 400 U.S. stores, as its merger with OfficeMax resulted in an overlap of retail locations that can be consolidated.
Management from both of Office Depot's metro-east stores at 20 Carlyle Plaza Drive in Belleville and 6647 Edwardsville Crossing Drive in Edwardsville said they have not been notified by the company concerning the announced closure.
Office Max has metro-east stores at Belleville Crossing at 5875 Belleville Crossing St. in Belleville, Fairview City Centre at 6595 N. Illinois St. in Fairview Heights, Cottonwood Plaza at 220 Junction Drive in Glen Carbon and Wood River Plaza at 520 Wesley Drive in Wood River.
Last year, Office Depot left Lincoln Place at 5905 N. Illinois St. in Fairview Heights. Also last year, Office Max closed at the former Kmart shopping center in Fairview Heights and reopened in a new store in the same vicinity earlier this year at the new Fairview City Centre.
The combined company's financial results beat Wall Street estimates for the January-March quarter and it raised its full year forecast for operating income on Tuesday.
Its shares jumped 17 percent in morning trading.
The office supply retailer had 1,900 stores in the U.S. at the end of the first quarter, so the plans call for closing about 21 percent of them. Office Depot and OfficeMax Inc. completed their $1.2 billion deal last November.
Office Depot said it has not quantified the number of jobs that will be affected by the store closures but that it will look to place its best talent impacted by the store closings into new roles, wherever possible.
Chairman and CEO Roland Smith said in a statement that one of the company's goals this year was to improve how its stores are positioned in North America to meet customer demand better and ensure that it's well positioned in the markets it serves.
"The overlapping retail footprint resulting from the merger provides us with a unique opportunity to consolidate and optimize our store portfolio, while maintaining the retail presence necessary to serve our customer," Smith said.
Office Depot said Tuesday that it expects to close 150 U.S. stores this year, mostly in the fourth quarter. It closed 14 stores in the first quarter, a company spokeswoman said.
For the period ended March 29, Office Depot lost $109 million, or 21 cents per share. In the prior-year period it lost $17 million, or 6 cents per share. Removing merger-related expenses and other items, earnings were 7 cents per share. Analysts surveyed by FactSet expected earnings of 3 cents per share.
Revenue climbed to $4.35 billion from $2.72 billion. Pro forma revenue for the year-ago period was $4.48 billion. Analysts expected revenue of $4.27 billion.
Shares of Office Depot rose 70 cents, or 17 percent, to $4.87 in morning trading.