ODP Corporation Q4 and Full Year 2024 Financial Results
The ODP Corporation, a leading provider of products, services, and technology solutions to businesses and consumers, has released its financial results for the fourth quarter and full year ended December 28, 2024. The company has reported a decline in revenue and earnings compared to the previous year, reflecting challenging market conditions and strategic shifts in its business operations.
Financial Highlights
For the fourth quarter of 2024, ODP Corporation reported total sales of $1.6 billion, a 10% decrease from the same period last year. The company's GAAP operating income was $20 million, down from $52 million in Q4 2023. Net income from continuing operations was $11 million, or $0.36 per diluted share, compared to $39 million, or $1.02 per diluted share, in the prior year period. Adjusted net income from continuing operations was $20 million, or $0.66 per diluted share, versus $43 million, or $1.13 per diluted share, in Q4 2023.
Business and Operational Highlights
ODP Corporation's performance was impacted by lower sales in its Office Depot Division, primarily due to 47 fewer retail locations and reduced retail and online consumer traffic. The ODP Business Solutions Division also saw a decline in sales, driven by macroeconomic factors and reduced business spending. Despite these challenges, the company made significant progress in its B2B pivot, securing major new business wins and entering new industry segments.
Strategic Initiatives and Corporate Developments
ODP Corporation announced a milestone agreement with a leading hospitality management company, positioning itself as a key supplier in the $16 billion hospitality industry. This strategic partnership is part of the company's broader "Optimize for Growth" plan, which aims to accelerate growth in B2B distribution and third-party logistics (3PL) market segments while reducing retail exposure. The company also repurchased 1.4 million shares at a cost of $43 million in Q4 2024 and 8 million shares for $300 million over the full year.
Management's Perspective
Gerry Smith, CEO of The ODP Corporation, highlighted the company's progress in its B2B transformation and the strategic importance of the new hospitality agreement. He emphasized the company's core strengths in supply chain, procurement, and distribution, which have provided a competitive advantage. Smith also acknowledged the challenging macroeconomic conditions but expressed confidence in the company's long-term growth strategy.
Future Outlook
Looking ahead to 2025, ODP Corporation plans to focus on capturing opportunities in the B2B marketplace and expanding into new industry segments. The company expects to incur costs in the range of $185 million to $230 million as part of its "Optimize for Growth" plan, which is anticipated to generate approximately $380 million in EBITDA improvement and over $1.3 billion in total value over the multi-year life of the plan.
SEC Filing: ODP Corp [ ODP ] - 8-K - Feb. 26, 2025