Segment Reporting

9 Months Ended

Oct. 27, 2012

Segment Reporting Disclosure [Abstract]

Segment Reporting

Segment Reporting

Staples has three reportable segments: North American Delivery, North American Retail and International Operations. Staples’ North American Delivery segment consists of the U.S. and Canadian businesses that sell and deliver office products and services directly to consumers and businesses and includes Staples Advantage, Staples.com and Quill.com.  The North American Retail segment consists of the U.S. and Canadian businesses that operate stores that sell office products and services. The International Operations segment consists of businesses in 23 countries in Europe, Australia, South America and Asia that operate stores and that sell and deliver office products and services directly to consumers and businesses.

As discussed in Note E - Discontinued Operations, the Company has classified PSD, which was formerly part of the International Operations segment, as a discontinued operation. Accordingly, the segments measures for International Operations have been recast to exclude PSD for all periods presented.

Staples evaluates performance and allocates resources based on profit or loss from operations before goodwill and long-lived asset impairment charges, restructuring charges, stock-based compensation, interest and other expense, other non-recurring items and the impact of changes in accounting principles (“business unit income”).  Intersegment sales and transfers are recorded at Staples’ cost; therefore, there is no intercompany profit or loss recognized on these transactions.

Staples’ North American Delivery and North American Retail segments are managed separately because the way they market products is different, the classes of customers they service may be different and the distribution methods used to deliver products to customers are different.  The International Operations are considered a separate reportable segment because of the significant differences in the operating environment from the North American operations.

The following is a summary of sales and business unit income by reportable segment and a reconciliation of business unit income to consolidated income before income taxes for the third quarter and year-to-date2012 and 2011 (in thousands):

	13 Weeks Ended						39 Weeks Ended
	October 27, 2012			October 29, 2011			October 27, 2012			October 29, 2011
	Sales
North American Delivery	$	2,609,034		$	2,582,729		$	7,576,860		$	7,527,592
North American Retail	2,646,554			2,656,612			6,959,524			7,029,840
International Operations	1,097,552			1,241,682			3,276,146			3,733,014
Total segment sales	$	6,353,140		$	6,481,023		$	17,812,530		$	18,290,446
	Business Unit Income (Loss)
North American Delivery	$	227,736		$	244,997		$	614,462		$	646,612
North American Retail	285,477			284,204			540,846			564,425
International Operations	(1,692		)	35,641			(27,114		)	70,985
Business unit income	511,521			564,842			1,128,194			1,282,022
Stock-based compensation	(27,276		)	(35,602		)	(90,406		)	(117,072		)
Impairment of goodwill and long-lived assets	(810,996		)	—			(810,996		)	—
Restructuring charges	(30,396		)	—			(30,396		)	—
Interest and other expense, net	(40,882		)	(42,808		)	(123,413		)	(129,988		)
(Loss) income from continuing operations before income taxes	$	(398,029	)	$	486,432		$	72,983		$	1,034,962

The following table shows our assets by reportable segment (in thousands):

	October 27, 2012		January 28, 2012
Assets:
North American Delivery	$	4,611,883	$	4,725,434
North American Retail	3,139,352		3,313,281
International Operations	4,214,801		5,391,907
Total segment assets	$	11,966,036	$	13,430,622
Current assets of discontinued operations	185,949		—
Total consolidated assets	$	12,151,985	$	13,430,622