Office Depot CEO: The ‘New ODP’ On Path To ‘Unlocking The Full Potential Of Our Business’
Summary
ODP, the parent company of Office Depot, is continuing its transition from dependence on its traditional commercial business and looking more and more like a B2B product and service provider based on its first fiscal quarter 2023 results. We believe we’re only in the early stages of unlocking our potential through this transformation, which is only beginning to be recognized externally.” ODP has over the past six years since Smith joined the company streamlined its cost structure, reducing cost of operations with over $500 million removed from the business from an SG&A perspective, realigned its assets to derive stability and long-term growth, and drove better performance across all its business, he said. “These include a large private fleet of approximately 600 vehicles; over 9 million square feet of distribution and logistics space; a national network of approximately 100 facilities, including distribution centers, cross-docks, and import facilities; a global sourcing presence; and numerous long-standing relationships with international and national carriers including last-mile providers.” The fourth, Varis, is a transformative, digitally native B2B procurement platform business that ODP has been creating over the past couple of years to help transform the complete procurement ecosystem for buying organizations and the suppliers that serve them, Smith said. “We’ve maintained our previously issued guidance for the year and remain in a position of strength with a low-cost business model mindset, diverse routes to market and a strong balance sheet,” he said. “As we move through the year and monitor consumer activity, we will continue to prioritize capital allocation while prudently managing our four-business-unit model while remaining focused on delivering strong shareholder returns.” For its fiscal first quarter 2023, which ended April 1, ODP reported total revenue of $2.11 billion, down 3 percent from the $2.18 billion the company reported for fiscal first quarter 2022.