Segment Information

3 Months Ended

Mar. 30, 2013

Segment Information

13. Segment Information

The Company manages its business using three reportable segments: Contract, Retail, and Corporate and Other. Management reviews the performance of the Company based on these segments.

Contract distributes a broad line of items for the office, including office supplies and paper, technology products and solutions, office furniture, print and document services and facilities products. Contract sells directly to large corporate and government offices, as well as to small and medium-sized offices and consumers in the United States, Canada, Australia and New Zealand. This segment markets and sells through field salespeople, outbound telesales, catalogs, the Internet and in some markets, including Canada, Australia and New Zealand, through office products stores. Substantially all products sold by Contract are purchased from third-party manufacturers or industry wholesalers. Contract purchases office papers for its businesses in the U.S., Canada, and Puerto Rico primarily from Boise White Paper, L.L.C., under a paper supply contract entered into on June 25, 2011.

Retail is a retail distributor of office supplies and paper, print and document services, technology products and solutions, office furniture and facilities products. In addition, this segment contracts with large national retail chains to supply office and school supplies to be sold in their stores. Retail office supply stores feature OfficeMax ImPress, an in-store module devoted to print-for-pay and related services. Retail has operations in the United States, Puerto Rico and the U.S. Virgin Islands. Retail also operates office products stores in Mexico through Grupo OfficeMax. Substantially all products sold by Retail are purchased from third-party manufacturers or industry wholesalers. Retail purchases office papers for its U.S. businesses primarily from Boise White Paper, L.L.C., under the paper supply contract described above.

Corporate and Other includes corporate support staff services and certain other legacy expenses as well as the related assets and liabilities. The income and expense related to certain assets and liabilities that are reported in the Corporate and Other segment have been allocated to the Contract and Retail segments.

Management evaluates the segments’ performances using segment income (loss) which is based on operating income (loss) after eliminating the effect of certain legacy operating items such as income associated with our Boise Investment and certain other operating items such as store closure costs and costs related to the proposed Merger Transactions, all of which are not indicative of our core operations.

The following tables contain details of the Company’s operations by segment:

	Sales		Segment income (loss)			Other operating (expenses) income, net			Operating income (loss)
	(thousands)
Three months ended March 30, 2013
Contract	$	921,291	$	15,429		$	—		$	15,429
Retail		845,438		16,223			—			16,223
Corporate and Other		—		(9,259	)		79,504			70,245
Total	$	1,766,729	$	22,393		$	79,504		$	101,897
Three months ended March 31, 2012
Contract	$	960,583	$	27,086		$	—		$	27,086
Retail		912,329		22,825			(25,266	)		(2,441	)
Corporate and Other		—		(8,866	)		2,069			(6,797	)
Total	$	1,872,912	$	41,045		$	(23,197	)	$	17,848

Interest expense, interest income, and other income, net are not recorded by segments.