Essendant reports fourth quarter loss
Essendant Inc.reported a loss of $95.8 million for the fourth quarter, as sales declined 2.7 percent to $1.29 billion.
The company reported net income of $22.1 million on sales of $1.33 billion for the same period in 2014.
The per share loss of $2.61 compared to a gain of 57 cents in the 2014 fourth quarter.
"In 2015 we took a series of actions to position the company for success, including renewing the focus on our core Office Product and JanSan businesses, lowering our cost structure and rebranding to Essendant," said Robert B. Aiken, Jr., president and chief executive officer of Essendant. "The impact of our actions was reflected in our fourth quarter as the team executed well – delivering strong earnings per share in the face of macroeconomic headwinds. As we look ahead, we are well-positioned to continue implementing our strategic initiatives and deliver revenue and earnings growth in 2016 consistent with our previous guidance."
The loss was impacted by one-time charges totaling $120.7 million related to the ORS Industrial business unit. These charges are comprised of an impairment of goodwill and intangibles totaling $115.8 million and a reserve increase for obsolete inventory of $4.9 million, which resulted from declines in the oilfield and energy sectors.
"Under new leadership, the ORS Industrial business has revised its merchandising and sales strategy to diversify its offerings and lessen dependencies on the oilfield and energy sectors as the environment in those sectors is expected to remain challenging," according to a company statement.
Full-year sales of $5.36 billion in 2015 compared to $5.32 billion in 2014. A net loss of $44.3 million for the year, or a loss of $1.18 per share, compared to net income of $112.1 million in 2014, or $2.87 per share.
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