Gerry Smith on transformation

About Gerry Smith

On a November 2020 earnings call for the fourth quarter and full year 2019, Office Depot CEO Gerry Smith stated that the company had embarked on a multi-year transformation strategy since 2017 focused on strengthening its B2B business and developing more predictable revenue streams. He said the company's business acceleration program delivered cost savings and improved operating performance, with profitability up year-over-year in each division. Smith noted that B2B businesses, including BSD and Compucom, generated approximately 60% of total revenue and well over half of operating income. He also reported that Compucom had stabilized operations and won new business in excess of $300 million in total lifetime contract value. Smith said the company strengthened its balance sheet, paid down debt, and returned cash to shareholders. He mentioned new partnerships with companies such as Shift for same-day delivery and store-with-partner opportunities with Lenovo. Smith stated that adjacency categories like cleaning and break room and copy and print services represented over a third of BSD sales. For 2020, he provided guidance of approximately $10.5 billion in sales, $550 million in adjusted EBITDA, and $350 million in adjusted operating income, assuming a stable global sourcing environment without significant disruptions such as the coronavirus outbreak. He also said the company anticipated completing a feasibility review of a potential holding company reorganization by the end of the first quarter of 2020.

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