|Staples.com First Quarter Revenue Grows 545 Percent|
FRAMINGHAM, Mass.--(BUSINESS WIRE)--May 16, 2000--
Delivers Sequential Quarterly Revenue Growth of 75 Percent
Repeat Customer Purchases 57 Percent of Sales
Staples.com, Staples Inc.'s (NASDAQ:SPLS) electronic marketplace that provides office supplies, services, content and community over the Internet, today announced revenues of $75.36 million for the first quarter 2000, which ended April 29, 2000, up 545 percent from the $11.69 million reported for the same period in the prior year and up 75 percent from the $43.07 million reported for the fourth quarter 1999. The business reported a net loss of $23.4 million.
"With the Staples.com Business Solutions Center, plus our newly enhanced Web site launched just last week, Staples.com offers a one-stop shop for small businesses -- from paper to payroll," said Jeanne B. Lewis, president of Staples.com. "This quarter, we exceeded our revenue projections with fewer losses than we originally anticipated. The power of the Staples brand, combined with our innovative Internet marketing strategies, are attracting the customers we want to Staples.com; our award-winning site and top-notch customer service keep them coming back. The number of repeat shoppers at Staples.com grew by 75 percent this quarter." -0-
Q1`99 Q2`99 Q3`99 Q4`99 Q1`00 Sales 421% 455% 493% 453% 545% (increase over same quarter, prior year) Sales 50% 34% 54% 80% 75% (increase over previous quarter) Gross Profit Rate 23% 23% 23% 20% 20% Number of Repeat Customers 53,000 82,000 143,500 (repeat customers making at least one purchase during the quarter) *T HIGHLIGHTS During the quarter, Staples.com:
--Ranked first, among the online businesses of the office supply superstore industry, in number of unique visitors in March by MediaMetrix and in unique audience size at home and at work by Nielsen NetRatings during the week of April 9, and was ranked the eighth most visited e-tail site in the U.S. during April, according to PC Data Online;
--Launched an enhanced Business Solutions Center with a request-for-quote purchasing option with 70 different types of business services and 20,000 sellers, content and community for small business;
--Added four new strategic "Click and Buy" service partners, including NowDocs.com for digital printing and delivery, application service provider McAfee, TaxLogic for online professional tax preparation service, and CloudSource, a Web site developer;
--Expanded internationally with its Canadian site launch in both English and French versions, localized with regional product and delivery;
--Premiered a national, comprehensive marketing campaign to increase brand awareness and drive customers to Staples.com;
--Increased the number of active partners in its affiliate program by launching a new, all-cash reward system;
--Announced plans to integrate StaplesLink.com with nine leading business-to-business purchasing solutions and e-marketplaces, including Ariba, Commerce One, Intelisys, Oracle Corporation, RightWorks Corporation, Requisite Technology, Inc., Clarus Corporation, TPN Register, LLC and Trilogy Software, Inc.; and
--Acquired the Quill.com domain name and redesigned the Web site.
Staples.com, a division of Staples Inc. (NASDAQ: SPLS), is creating a business-to-business electronic marketplace offering a comprehensive solution for the office needs of business customers. Staples.com currently provides an electronic marketplace where small, mid-sized and large businesses can procure office products and business services and obtain business information and expert content. Staples.com includes the operations of Staples Inc.'s e-commerce sites: Staples.com, Quill.com and StaplesLink.com, and its Canadian e-commerce business.
Certain information presented within this news release may constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, which are discussed in our most recent Proxy Statement on file with the Securities and Exchange Commission. -0-
STAPLES.COM (A DIVISION OF STAPLES, INC.) Combined Balance Sheets (Dollar Amounts in Thousands) April 29, January 29, 2000 2000 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ -- $ -- Prepaid expenses and other current assets 1,655 1,578 Inter-business receivable from Staples RD -- 23,660 Total current assets 1,655 25,238 Equipment: Equipment 17,884 13,538 Less accumulated depreciation 2,778 1,110 Net equipment 15,106 12,428 Other Assets Investments 239,414 34,755 $ 256,175 $ 72,421 LIABILITIES AND DIVISIONAL NET WORTH Current Liabilities: Accrued expenses and other current liabilities $ 17,756 $ 7,466 Inter-business payable to Staples RD 100,208 -- Total current liabilities 117,964 7,466 Divisional Net Worth: Common stock: Staples.com Stock, $ .0006 par value 600,000,000 shares authorized; 14,028,672 shares issued and outstanding at April 29, 2000 and 13,626,093 at January 29, 2000 8 8 Additional paid-in capital 78,231 75,604 Cumulative foreign currency translation adjustments 3 -- Unrealized gain on investments 100,756 6,695 Accumulated deficit (40,787) (17,352) Total divisional net worth 138,211 64,955 $ 256,175 $ 72,421 STAPLES.COM (A DIVISION OF STAPLES, INC.) Combined Statements of Operations (Dollar Amounts in Thousands, Except Share Data) (Unaudited) 13 Weeks Ended April 29, May 1, 2000 1999 Sales $ 75,363 $ 11,692 Cost of goods sold and occupancy costs 60,607 9,022 Gross profit 14,756 2,670 Operating and other expenses: Operating and selling 33,248 3,683 Site development costs 7,653 518 General and administrative 13,491 1,845 Interest and other expense, net 85 15 Total operating and other expenses 54,477 6,061 Loss before income taxes (39,721) (3,391) Income tax benefit (16,286) (1,322) Net loss $(23,435) $ (2,069) Net loss attributed to (Note A): Staples.com Stock (2,842) -- Staples RD Stock (20,593) (2,069) $(23,435) $ (2,069) Basic net loss per common share Historical net loss per common share $ (0.21) Diluted net loss per common share Historical net loss per common share $ (0.21) Pro forma net loss per common share for tracking stock: Basic net loss per common share Pro forma net loss per common share $ (0.02) Diluted net loss per common share Pro forma net loss per common share $ (0.02) STAPLES.COM (A DIVISION OF STAPLES, INC.) Combined Statements of Cash Flows (Dollar Amounts in Thousands) (Unaudited) 13 Weeks Ended April 29, May 1, 2000 1999 Operating Activities: Net loss $(23,435) $ (2,069) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 2,418 71 Change in assets and liabilities: Increase in prepaid expenses and other assets (77) 251 Increase in accounts payable, accrued expenses and other current liabilities 10,290 739 12,631 1,061 Net cash used in operating activities (10,804) (1,008) Investing Activities: Acquisition of property and equipment (4,346) (104) Purchase of long-term investments (44,862) -- Net cash used in investing activities (49,208) (104) Financing Activities: Net proceeds from sale of capital stock 1,877 -- Repayment of inter-business advance to Staples RD 27,940 -- Proceeds from borrowings from Staples RD 30,195 1,008 Capital contributions from Staples RD -- 104 Net cash provided by financing activities 60,012 1,112 Net (decrease) increase in cash and cash equivalents -- -- Cash and cash equivalents at beginning of period -- -- Cash and cash equivalents at end of period $ -- $ -- *T CONTACT: Shannon Lapierre Public Relations Manager 508-253-8468 email@example.com or Bonnie Monahan Vice President of Investor Relations 508-253-7963 firstname.lastname@example.org