* Q3 profit to top view, affirms long-term expectations
* Shares rise 5 percent in extended trading
(Adds store openings, background on industry)
LOS ANGELES Oct 29 Staples Inc (SPLS.O) said
on Wednesday its third-quarter adjusted profit would top Wall
Street estimates and backed its long-term financial
expectations, sending its shares up 5 percent in extended
The outlook from the world's largest office products
retailer came hours after rival Office Depot Inc ODP.N posted
a surprising quarterly loss and said it would delay new store
openings in the weak U.S. economy.
Staples, which plans to open 75 units in North America next
year down from 110 slated for 2008, expects to report
third-quarter adjusted earnings of 41 cents to 42 cents per
share, excluding the impact of charges related to its
acquisition of Corporate Express.
Analysts, on average, expected adjusted profit to be 40
cents, according to Reuters Estimates.
Staples' said its long-term operating margin goal for the
total company is 9 percent, up from the 6.5 percent pro-forma
operating margin achieved in 2007, including the results of
Sales have suffered at Staples, along with rivals Office
Depot and OfficeMax Inc OMX.N, as small business owners and
retail consumers cut back on purchases.
Framingham, Massachusetts-based Staples, which has an
investment-grade rating, expects $1 billion in free cash flow
Staples repaid $700 million of debt related to the
acquisition during the third quarter. It has a $2.5 billion
balance between its commercial paper program and its 364-day
bridge loan, and expects to finalize permanent financing by
The company also said it "tightened" capital spending plans
to a range of $400 million to $500 million for 2009.
Shares of Staples rose to $16.75 in extended trading from
their $15.94 close in regular trading on Nasdaq.
(Reporting by Lisa Baertlein; Editing by Tim Dobbyn/Jeffrey