8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 24, 2011

UNITED STATIONERS INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	0-10653	36-3141189
(State or Other Jurisdiction Of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

One Parkway North Boulevard Suite 100 Deerfield, Illinois	60015-2559
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (847) 627-7000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

United Stationers Inc.

Item 2.02 Results of Operations and Financial Condition.

The following information, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” hereunder for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

On October 24, 2011, the Registrant issued a press release announcing its financial results for the three- and nine-month periods ended September 30, 2011. A copy of the Registrant’s press release is attached as Exhibit 99.1 hereto and is incorporated herein by reference. In addition, a slide presentation summarizing earnings and financial results is attached as Exhibit 99.2 hereto and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1*	Press Release, dated October 24, 2011, announcing financial results for the three- and nine-month periods ended September 30, 2011.
99.2*	Earnings Presentation, a slide presentation summarizing earnings and financial results.

* — Included herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	UNITED STATIONERS INC.
	(Registrant)
Dated: October 24, 2011	/s/    FAREED A. KHAN
	Fareed A. Khan
	Senior Vice President and Chief Financial Officer

EXHIBIT INDEX

(d) Exhibits

Exhibit No.	Description
99.1*	Press Release, dated October 24, 2011, announcing financial results for the three- and nine-month periods ended September 30, 2011.
99.2*	Earnings Presentation, a slide presentation summarizing earnings and financial results.

* — Included herewith.

EX-99.1

Exhibit 99.1

Executive Offices
One Parkway North Blvd.	For Further Information Contact:
Suite 100
Deerfield, IL 60015-2559	Cody Phipps
	President and Chief Executive Officer
	or
	Fareed A. Khan
	Sr. Vice President and Chief Financial Officer
	United Stationers Inc.
	(847) 627-7000

UNITED STATIONERS REPORTS

INCREASED SALES AND EARNINGS PER SHARE FOR THIRD QUARTER 2011

DEERFIELD, Ill., Oct. 24, 2011 – United Stationers Inc. (NASDAQ: USTR), a leading North American wholesale distributor of business products, today reported third quarter 2011 sales up 3.1% and adjusted earnings per share up 13%⁽¹⁾.

Third Quarter Financial Highlights

• Net sales in the third quarter were $1.3 billion, up 3.1% from the prior-year quarter.

• Diluted earnings per share were $0.81, compared with $0.77 in the prior-year quarter. The third quarter 2010 results included a favorable $0.05 per share for a $3.3 million non-cash pre-tax reversal of liabilities resulting from the termination of a post-retirement medical plan. After excluding this item from the prior year, diluted earnings per share for the third quarter of 2011 were up 13%⁽¹⁾, compared with an adjusted $0.72⁽¹⁾ a year ago.

• Gross margin in the third quarter of 2011 was up $4.9 million to $199.8 million, or 15.3% of sales, compared with $194.9 million, or 15.3% of sales, in last year’s third quarter.

• Operating expenses in the quarter were $135.1 million, or 10.3% of sales, compared with $129.3 million, or 10.2% of sales in the prior-year quarter. Operating expenses as a percentage of sales in the third quarter of 2011 were favorable by 12 basis points compared with 10.4%⁽¹⁾ in the same period last year after excluding the medical plan adjustment mentioned above.

• Operating income in the quarter was $64.6 million, or 4.9% of sales, compared with $65.5 million, or 5.2% of sales, in the year-ago quarter. Operating income in the 2011 quarter was up $2.4 million and operating margin was flat at 4.9%, compared with the prior-year quarter after adjusting for the medical plan adjustment mentioned above.

• Net income was $35.8 million in 2011, compared with $36.5 million in the year-ago quarter. Third quarter 2011 net income was up $1.4 million⁽¹⁾, compared with the adjusted prior-year quarter of $34.4 million⁽¹⁾.

• Year-to-date net cash provided by operating activities totaled $99.5 million versus $114.4 million last year.

• Cash paid for share repurchases for the nine months ended September 30, 2011, totaled $137.7 million for 4.3 million shares. As of September 30, 2011, the company had $50 million remaining under its board of directors approved common stock repurchase program. On October 19, 2011, the board of directors approved a $0.13 per share dividend to shareholders of record on December 15, 2011 and payable on January 13, 2012.

• In September 2011, the company closed a five-year $700 million Revolving Credit Facility.

“Our growth and customer initiatives continue to drive positive results, particularly in our janitorial/breakroom and industrial categories, in an economy that still does not have many bright spots,” said Cody Phipps, president and chief executive officer. “We are keeping a sharp focus on margins, operating costs and capital deployment to ensure a strong financial position in the current environment. At the same time, we continue to invest in the future, creating attractive long-term opportunities for the business.”

Third Quarter Performance

Sales in the third quarter of 2011 increased by 3.1% to $1.3 billion, compared with last year. Strong sales growth continued in the industrial supplies and janitorial/breakroom categories, which were up 23.7% and 10.6%, respectively, from last year. Office products, technology and furniture category sales were down 0.6%, 0.6% and 9.8%, respectively, versus the prior year. A significant portion of the furniture category decline was due to a sourcing shift in some national account business.

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United Stationers Reports Increased Sales and Earnings Per Share for Third Quarter 2011

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Gross margin in the third quarter of 2011, was up $4.9 million to $199.8 million, compared with $194.9 million for the same quarter a year ago. Gross margin as a percent of sales was 15.3%, flat compared to the prior-year quarter. Gross margin was negatively affected by ongoing competitive pricing pressures and higher fuel costs, while higher product cost inflation, higher inventory purchase-related supplier allowances and other inventory-related benefits helped to offset these items. In addition, ongoing War on Waste (WOW) initiatives positively contributed to gross margin.

Operating expenses for the latest quarter were $135.1 million or 10.3% of sales, compared with $129.3 million, or 10.2% of sales, in the same period last year. 2010 operating expenses included a non-cash $3.3 million favorable adjustment related to the termination of a post-retirement medical plan. Excluding this item, 2010 operating expenses were $132.6 million⁽¹⁾ or 10.4%⁽¹⁾ of sales. Continued investments in strategic growth initiatives, costs to support higher sales and higher bad debt costs in 2011 contributed to the increase in operating expenses. These cost increases were partially offset by lower depreciation, favorable resolution of non-income based tax liabilities and continued success with WOW efforts.

Operating income for the latest quarter was $64.6 million or 4.9% of sales, compared with $65.5 million, or 5.2% of sales in the same quarter last year. Excluding the medical plan adjustment referenced above, 2010 operating income was $62.2 million⁽¹⁾ or 4.9%⁽¹⁾ of sales.

Diluted earnings per share for the 2011 quarter were $0.81, compared with $0.77 in the year-ago quarter. Excluding the effect of the medical plan adjustment referenced above, last year’s diluted earnings per share were $0.72⁽¹⁾.

Nine-Month Performance

Sales in the first nine months of 2011 were $3.8 billion, up 4.3%, led by double-digit increases in industrial supplies and in the janitorial/breakroom category and low single digit growth in the office products category. These increases were partially offset by lower furniture sales and a slight decrease in technology sales.

Gross margin for the first nine months of 2011 increased to $566.4 million or 14.9% of sales, compared with $541.0 million or 14.8% of sales in the same prior-year period. The increase was due to sales growth, higher inventory purchase-related supplier allowances, greater product cost inflation, and other inventory-related items. These favorable items were partially offset by competitive pricing pressures and higher fuel costs.

Operating expenses in 2011 were $413.9 million or 10.9% of sales, which included a $4.4 million equity compensation charge as well as a $1.6 million asset impairment charge related to an equity investment. This compares to last year’s operating expenses of $389.3 million, or 10.7% of sales, which included a $6.1 million benefit from an accrual reversal for the termination of a post-retirement medical plan. Excluding these items, operating expenses in 2011 were $407.9 million⁽¹⁾ or 10.7%⁽¹⁾ of sales, compared with the prior year of $395.4 million⁽¹⁾ or 10.9%⁽¹⁾ of sales. Increased operating expense in 2011 supported strategic growth initiatives partially offset by lower variable management compensation costs, lower depreciation expense and continued WOW savings.

Operating income for the first nine months of 2011 was $152.4 million or 4.0% of sales, compared with $151.7 million, or 4.2% of sales in the prior-year period. Excluding the items mentioned above, operating income in 2011 was $158.5 million⁽¹⁾ or 4.2%⁽¹⁾ of sales, compared with $145.6 million⁽¹⁾ or 4.0%⁽¹⁾ of sales in the prior year.

Diluted earnings per share for the first nine months of 2011 were $1.77 versus $1.68 in the first nine months of 2010. Excluding the items mentioned above, diluted earnings per share for the first nine months of 2011 rose 17% to $1.87⁽¹⁾, compared with $1.60⁽¹⁾ in the prior-year period.

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United Stationers Reports Increased Sales and Earnings Per Share for Third Quarter 2011

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Cash Flow, Debt Trends and Share Repurchases

Net cash provided by operating activities totaled $99.5 million for the latest nine-month period versus cash provided of $114.4 million a year ago. This year’s cash flow was positively affected by a significant reduction in inventory offset by higher accounts receivable and lower accounts payable. Cash flow used in investing activities totaled $20.7 million in 2011, down from $33.4 million in the first nine months of 2010. Included in 2010 investing activities is $15.5 million related to an acquisition. Capital spending through the nine months ended September 30, 2011 was $20.7 million and is expected to be in the range of $25 million to $30 million for 2011.

In September 2011, the company closed a five-year $700 million Revolving Credit Facility. This facility replaced a $425 million revolver and $200 million term loan. Including the new facility, the company has total committed funding sources of approximately $940 million. As of September 30, 2011, the company had total debt outstanding of $489.7 million, compared with $441.8 million as of September 30, 2010. As of September 30, 2011 and 2010, debt-to-total capitalization was 40.4% and 37.6%, respectively. Through the first nine months of 2011, the company repurchased 4.3 million shares for $137.7 million, which was partially offset by $11.5 million of net proceeds received from share-based compensation arrangements. The company has $50 million remaining under its board of directors authorized common stock repurchase program.

Outlook

“We do not expect to see meaningful near-term improvements in the markets where we participate,” commented Phipps. “The economy is still challenged by high unemployment, low business and consumer confidence and slow growth. In this environment, we are focused on driving growth from our own actions and initiatives rather than waiting for conditions to improve. We are focused on executing our Winning-from-the-Middle strategy and are seeing very encouraging results in several areas, most notably from our industrial and janitorial/breakroom categories. We will keep our businesses healthy and profitable while we enhance shareholder value through earnings growth, dividends, and share repurchases.”

Conference Call

United Stationers will hold a conference call followed by a question and answer session on Tuesday, October 25, 2011, at 10:00 a.m. CDT, to discuss third quarter 2011 results. To participate, callers within the U.S. and Canada should dial (800) 264-7882, and international callers should dial (847) 413-3708 approximately 10 minutes before the presentation. The confirmation number is “30861712.” To listen to the webcast, participants should visit the Investor Information section of the company’s website at ir.unitedstationers.com several minutes before the event is broadcast and follow the instructions provided to ensure that the necessary audio application is downloaded and installed. This program is provided at no charge to the user. In addition, interested parties can access an archived version of the call, also located on the Investor Information section of United Stationers’ website, about two hours after the call ends. This news release, along with a financial slide presentation and other information relating to the call, also will be available on United’s website.

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Forward-Looking Statements

This news release contains forward-looking statements, including references to goals, plans, strategies, objectives, projected costs or savings, anticipated future performance, results or events and other statements that are not strictly historical in nature. These statements are based on management’s current expectations, forecasts and assumptions. This means they involve a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied here. These risks and uncertainties include, but are not limited to the following: prevailing economic conditions and changes affecting the business products industry and the general economy; United’s ability to effectively manage its operations and to implement growth, cost-reduction and margin-enhancement initiatives; United’s reliance on key customers, and the business, credit and other risks inherent in continuing or increased customer concentration; United’s reliance on key suppliers and the supplier allowances and promotional incentives they offer; United’s reliance on independent resellers for a significant percentage of its net sales and therefore the importance of the continued independence, viability and success of these resellers; continuing or increasing competitive activity and pricing pressures within existing or expanded product categories, including competition from product manufacturers who sell directly to United’s customers; the impact of variability in customer and end-user demand patterns on United’s product sales mix and, in turn, on profit margins; the impact of a loss of, or substantial decrease in, the availability of products or service from key suppliers at competitive prices; the availability of financing sources to meet United’s business needs; United’s ability to manage inventory in order to maximize sales and supplier allowances while minimizing excess and obsolete inventory; United’s ability to maintain its existing information technology and e-commerce systems and to successfully procure and implement new systems without business disruption or other unanticipated difficulties or costs; United’s ability to effectively identify, consummate and integrate acquisitions; United’s reliance on key management personnel, both in day-to-day operations and in execution of new business initiatives; and the effects of hurricanes, acts of terrorism and other natural or man-made disruptions.

Shareholders, potential investors and other readers are urged to consider these risks and uncertainties in evaluating forward-looking statements and are cautioned not to place undue reliance on the forward-looking statements. For additional information about risks and uncertainties that could materially affect United’s results, please see the company’s Securities and Exchange Commission filings. The forward-looking information in this news release is made as of this date only, and the Company does not undertake to update any forward-looking statement. Investors are advised to consult any further disclosure by United regarding the matters discussed in this release in its filings with the Securities and Exchange Commission and in other written statements it makes from time to time. It is not possible to anticipate or foresee all risks and uncertainties, and investors should not consider any list of risks and uncertainties to be exhaustive or complete.

Company Overview

United Stationers Inc. is a leading wholesale distributor of business products, with 2010 net sales of approximately $4.8 billion. The company stocks approximately 100,000 items, including technology products, traditional office products, janitorial and breakroom supplies, office furniture, and industrial supplies. A network of 64 distribution centers allows it to deliver these products to over 25,000 reseller customers. This network, combined with United’s depth and breadth of inventory, enables the company to ship most products overnight to more than 90% of the U.S. and major cities in Mexico. For more information, visit www.unitedstationers.com.

United Stationers’ common stock trades on the NASDAQ Global Select Market under the symbol USTR.

⁽¹⁾  This is non-GAAP information. A reconciliation of these items to the most comparable GAAP measures is presented at the end of this news release. Except as noted, all references within this news release to financial results are presented in accordance with U.S. Generally Accepted Accounting Principles.

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United Stationers Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(unaudited)

(in thousands, except per share data)

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2011		2010		2011		2010
Net sales	$	1,310,029	$	1,270,701	$	3,804,110	$	3,645,769
Cost of goods sold		1,110,278		1,075,840		3,237,748		3,104,803
Gross profit		199,751		194,861		566,362		540,966
Operating expenses:
Warehousing, marketing and administrative expenses		135,117		129,323		413,917		389,309
Operating income		64,634		65,538		152,445		151,657
Interest expense		6,972		6,637		20,094		19,302
Other expense		100		—		410		—
Income before income taxes		57,562		58,901		131,941		132,355
Income tax expense		21,783		22,431		50,879		50,658
Net income	$	35,779	$	36,470	$	81,062	$	81,697
Net income per share - diluted	$	0.81	$	0.77	$	1.77	$	1.68
Weighted average number of common shares - diluted		44,202		47,548		45,718		48,624

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United Stationers Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(dollars in thousands, except share data)

	(unaudited) As of September 30,						(audited) As of December 31,
	2011			2010			2010
ASSETS
Current assets:
Cash and cash equivalents	$	10,489		$	38,552		$	21,301
Accounts receivable, net		699,174			655,075			628,119
Inventories		615,506			617,439			684,091
Other current assets		26,839			31,479			31,895
Total current assets		1,352,008			1,342,545			1,365,406
Property, plant and equipment, net		127,078			129,431			135,301
Intangible assets		57,573			62,722			61,441
Goodwill		328,061			328,445			328,581
Other long-term assets		20,392			17,842			17,934
Total assets	$	1,885,112		$	1,880,985		$	1,908,663
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	410,811		$	424,883		$	421,566
Accrued liabilities		174,325			186,328			186,387
Short-term debt		6,800			—			6,800
Total current liabilities		591,936			611,211			614,753
Deferred income taxes		21,059			6,115			14,053
Long-term debt		482,923			441,800			435,000
Other long-term liabilities		68,035			88,756			85,259
Total liabilities		1,163,953			1,147,882			1,149,065
Stockholders’ equity:
Common stock, $0.10 par value; authorized – 100,000,000 shares, issued – 74,435,628 shares in 2011 and 2010		7,444			7,444			7,444
Additional paid-in capital		413,173			395,712			400,910
Treasury stock, at cost – 31,834,490 and 28,105,054 shares at September 30, 2011 and 2010, respectively, and 28,247,906 shares at December 31, 2010		(891,545	)		(760,756	)		(772,698	)
Retained earnings		1,230,656			1,136,049			1,167,109
Accumulated other comprehensive loss		(38,569	)		(45,346	)		(43,167	)
Total stockholders’ equity		721,159			733,103			759,598
Total liabilities and stockholders’ equity	$	1,885,112		$	1,880,985		$	1,908,663

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United Stationers Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(unaudited) (in thousands)

	For the Nine Months  Ended September 30,
	2011			2010
Cash Flows From Operating Activities:
Net income	$	81,062		$	81,697
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		25,822			27,647
Share-based compensation		13,072			10,455
Loss on the disposition of plant, property and equipment		28			49
Impairment of equity investment		1,635			—
Amortization of capitalized financing costs		728			551
Excess tax benefits related to share-based compensation		(3,397	)		(3,606	)
Deferred income taxes		4,387			5,813
Changes in operating assets and liabilities, excluding the effect of acquisitions:
Increase in accounts receivable, net		(71,662	)		(13,141	)
Decrease (increase) in inventory		67,747			(25,594	)
Decrease (increase) in other assets		2,879			(2,036	)
Increase in accounts payable		12,135			86,522
Decrease in checks in-transit		(23,232	)		(53,007	)
(Decrease) increase in accrued liabilities		(5,346	)		10,868
Decrease in other liabilities		(6,369	)		(11,861	)
Net cash provided by operating activities		99,489			114,357
Cash Flows From Investing Activities:
Capital expenditures		(20,786	)		(17,967	)
Acquisitions, net of cash acquired		—			(15,527	)
Proceeds from the disposition of property, plant and equipment		62			58
Net cash used in investing activities		(20,724	)		(33,436	)
Cash Flows From Financing Activities:
Net borrowings under Revolving Credit Facility		77,923			—
Repayment of debt		(370,000	)		—
Proceeds from the issuance of debt		340,000			—
Net proceeds from share-based compensation arrangements		11,486			24,899
Acquisition of treasury stock, at cost		(137,669	)		(89,355	)
Payment of cash dividends		(11,955	)		—
Excess tax benefits related to share-based compensation		3,397			3,606
Payment of debt fees and other		(2,727	)		(99	)
Net cash used in financing activities		(89,545	)		(60,949	)
Effect of exchange rate changes on cash and cash equivalents		(32	)		25
Net change in cash and cash equivalents		(10,812	)		19,997
Cash and cash equivalents, beginning of period		21,301			18,555
Cash and cash equivalents, end of period	$	10,489		$	38,552

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United Stationers Inc. and Subsidiaries

Reconciliation of Non-GAAP Financial Measures

Adjusted Operating Income, Net Income and Diluted Earnings Per Share

(unaudited)

(in thousands, except per share data)

	For the Three Months Ended September 30,
	2011						2010
	Amount			% to Net Sales			Amount			% to Net Sales
Net sales	$	1,310,029			100.00	%	$	1,270,701			100.00	%
Gross profit	$	199,751			15.25	%	$	194,861			15.33	%
Operating expenses	$	135,117			10.32	%	$	129,323			10.18	%
Post-retirement medical plan termination		—			—			3,315			0.26
Adjusted operating expenses	$	135,117			10.32	%	$	132,638			10.44	%
Operating income	$	64,634			4.93	%	$	65,538			5.15	%
Operating expense item noted above		—			—			(3,315	)		(0.26	)%
Adjusted operating income	$	64,634			4.93	%	$	62,223			4.89	%
Net income	$	35,779					$	36,470
Operating expense item noted above, net of tax		—						(2,053	)
Adjusted net income	$	35,779					$	34,417
Diluted earnings per share	$	0.81					$	0.77
Per share operating expense item noted above		—						(0.05	)
Adjusted diluted earnings per share	$	0.81					$	0.72
Adjusted diluted earnings per share — growth rate over the prior year period		13	%
Weighted average number of common shares — diluted		44,202						47,548

Note: Adjusted Operating Expenses, Operating Income, Net Income and Earnings Per Share in the third quarter of 2010 exclude the effects of terminating a post-retirement medical plan. Generally Accepted Accounting Principles require that the effects of this item be included in the Condensed Consolidated Statements of Income. Management believes that excluding this item results in an appropriate comparison of the Company’s ongoing operating results. It is helpful to provide readers of the financial statements with a reconciliation of this item to the Condensed Consolidated Statements of Income reported in accordance with Generally Accepted Accounting Principles.

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United Stationers Inc. and Subsidiaries

Reconciliation of Non-GAAP Financial Measures

Adjusted Operating Income, Net Income and Diluted Earnings Per Share

(unaudited)

(in thousands, except per share data)

	For the Nine Months Ended September 30,
	2011						2010
	Amount			% to Net Sales			Amount			% to Net Sales
Net sales	$	3,804,110			100.00	%	$	3,645,769			100.00	%
Gross profit	$	566,362			14.89	%	$	540,966			14.84	%
Operating expenses	$	413,917			10.88	%	$	389,309			10.68	%
Equity compensation – CEO transition		(4,409	)		(0.12	)%		—			—
Asset impairment charge		(1,635	)		(0.04	)%		—			—
Post-retirement medical plan termination		—			—			6,077			0.17	%
Adjusted operating expenses	$	407,873			10.72	%	$	395,386			10.85	%
Operating income	$	152,445			4.01	%	$	151,657			4.16	%
Operating expense item noted above		6,044			0.16	%		(6,077	)		(0.17	)%
Adjusted operating income	$	158,489			4.17	%	$	145,580			3.99	%
Net income	$	81,062					$	81,697
Operating expense item noted above, net tax		4,367						(3,754	)
Adjusted net income	$	85,429					$	77,943
Diluted earnings per share	$	1.77					$	1.68
Per share operating expense item noted above		0.10						(0.08	)
Adjusted diluted earnings per share	$	1.87					$	1.60
Adjusted diluted earnings per share — growth rate over the prior year period		17	%
Weighted average number of common shares — diluted		45,718						48,624

Note: Adjusted Operating Expenses, Operating Income, Net Income and Earnings Per Share for the nine months ended September 30, 2011, exclude the effects of an equity compensation charge related to a transition agreement with the former chief executive officer and a non-deductible asset impairment charge. In addition, the results for the nine months ended September 30, 2010, were adjusted to exclude the effects of terminating a post-retirement medical plan. Generally Accepted Accounting Principles require that the effects of this item be included in the Condensed Consolidated Statements of Income. Management believes that excluding these items results in an appropriate comparison of the Company’s ongoing operating results. It is helpful to provide readers of the financial statements with a reconciliation of these items to the Condensed Consolidated Statements of Income reported in accordance with Generally Accepted Accounting Principles.

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EX-99.2

October 24, 2011

1

United Stationers Inc.

Earnings Presentation

Third Quarter 2011

TO BE FILED IN

CONJUNCTION WITH

PRESS RELEASE

Exhibit 99.2

October 24, 2011

2

Forward Looking Statements and

Non-GAAP Measures

This

presentation

contains

forward-looking

statements,

including

references

to

goals,

plans,

strategies,

objectives,

anticipated

future

performance,

results

or

events

and

other

statements

that

are

not

strictly

historical

in

nature.

These

statements

are

based

on

management’s

current

expectations,

forecasts

and

assumptions.

This

means

they

involve

a

number

of

risks

and

uncertainties

that

could

cause

actual

results

to

differ

materially

from

those

expressed

or

implied

here.

These

risks

and

uncertainties

include,

but

are

not

limited

to,

the

following:

Prevailing

economic

conditions

and

changes

affecting

the

business

products

industry

and

the

general

economy;

United’s

ability

to

effectively

manage

its

operations

and

to

implement

growth,

cost-reduction

and

margin-enhancement

initiatives;

United’s

reliance

on

key

customers,

and

the

business,

credit

and

other

risks

inherent

in

continuing

or

increased

customer

concentration;

United’s

reliance

on

key

suppliers

and

the

supplier

allowances

and

promotional

incentives

they

offer;

United’s

reliance

on

independent

resellers

for

a

significant

percentage

of

its

net

sales

and

therefore

the

importance

of

the

continued

independence,

viability

and

success

of

these

resellers;

continuing

or

increasing

competitive

activity

and

pricing

pressures

within

existing

or

expanded

product

categories,

including

competition

from

product

manufacturers

who

sell

directly

to

United’s

customers;

the

impact

of

variability

in

customer

and

end-user

demand

patterns

on

United’s

product

sales

mix

and,

in

turn,

on

profit

margins;

the

impact

of

a

loss

of,

or

substantial

decrease

in,

the

availability

of

products

or

service

from

key

suppliers

at

competitive

prices;

the

availability

of

financing

sources

to

meet

United’s

business

needs;

United’s

ability

to

manage

inventory

in

order

to

maximize

sales

and

supplier

allowances

while

minimizing

excess

and

obsolete

inventory;

United’s

ability

to

maintain

its

existing

information

technology

and

e-commerce

systems

and

to

successfully

procure

and

implement

new

systems

without

business

disruption

or

other

unanticipated

difficulties

or

costs;

United’s

ability

to

effectively

identify,

consummate

and

integrate

acquisitions;

United’s

reliance

on

key

management

personnel,

both

in

day-to-day

operations

and

in

execution

of

new

business

initiatives;

and

the

effects

of

hurricanes,

acts

of

terrorism

and

other

natural

or

man-made

disruptions. 

Shareholders,

potential

investors

and

other

readers

are

urged

to

consider

these

risks

and

uncertainties

in

evaluating

forward-looking

statements

and

are

cautioned

not

to

place

undue

reliance

on

the

forward-looking

statements.

For

additional

information

about

risks

and

uncertainties

that

could

materially

affect

United’s

results,

please

see

the

company’s

Securities

and

Exchange

Commission

filings.

The

forward-looking

information

in

this

presentation

is

made

as

of

this

date

only,

and

the

Company

does

not

undertake

to

update

any

forward-

looking

statement.

Investors

are

advised

to

consult

any

further

disclosure

by

United

regarding

the

matters

discussed

in

this

release

in

its

filings

with

the

Securities

and

Exchange

Commission

and

in

other

written

statements

it

makes

from

time

to

time.

It

is

not

possible

to

anticipate

or

foresee

all

risks

and

uncertainties,

and

investors

should

not

consider

any

list

of

risks

and

uncertainties

to

be

exhaustive

or

complete.

*

This

is

non-GAAP

information.

A

reconciliation

of

these

items

to

the

most

comparable

GAAP

measures

is

presented

on

the

company’s

Website

(www.unitedstationers.com)

under

the

Investor

Information

section.

Except

as

noted,

all

references

to

financial

results

within

this

presentation

are

presented

in

accordance

with

U.S.

Generally

Accepted

Accounting

Principles.

October 24, 2011

3

Q3 2011 Headlines

Sales increased 3.1% from Q3 2010 to $1.31 billion.

Earnings per diluted share were $0.81, up 13%* from an adjusted Q3 2010

EPS of $0.72*. 

Gross margin rate of 15.3% was flat with last year.

Operating expenses in Q3 2011 were $135.1 million, compared to an

adjusted $132.6 million* in the prior-year quarter, and were 10.3% of sales,

down from 10.4%* of sales in the prior-year quarter.

Operating income as a percent of sales was 4.9%, flat with last year’s

adjusted 4.9%*.

Net

income

increased

4%*

to

$35.8

million

from

an

adjusted

$34.4

million*

in Q3 2010.

Net cash provided by operating activities was $26.2 million in Q3 2011.

Debt was up $47.9 million from the prior-year end and from the prior-year

quarter end.

During the quarter, the Company repurchased 2.2 million shares for $67.8

million and paid a cash dividend of $6 million to common shareholders.

October 24, 2011

4

Third Quarter 2011 P&L

% to sales change

$

% to Sales

$

% to Sales

$ change

% change

Fav (Unfav)

$ Millions (except EPS)

QTD Q3 2011

QTD Q3 2011

QTD Q3 2010

QTD Q3 2010

Fav (Unfav)

Fav (Unfav)

basis points

Net Sales

1,310.0

$      

1,270.7

$      

39.3

$       

3.1%

Workday Adjusted Sales Growth

3.1%

Gross Margin

199.7

15.25%

194.8

15.33%

4.9

2.5%

(8)

Operating Expense

135.1

10.32%

129.3

10.18%

(5.8)

(4.5%)

(14)

Operating Income

64.6

4.93%

65.5

5.15%

(0.9)

(1.4%)

(22)

Interest & Other

7.0

0.53%

6.6

0.52%

(0.4)

(6.1%)

(1)

Taxes

21.8

1.67%

22.4

1.77%

0.6

2.7%

10

Net Income

35.8

$          

2.73%

36.5

$          

2.87%

(0.7)

$        

(1.9%)

(14)

Diluted Shares (000s)

44,202

47,548

Diluted EPS

0.81

$          

0.77

$          

0.04

$       

5.2%

Effective Tax Rate

37.8%

38.1%

Adjusted to exclude non-operating items *

Adjusted Operating Income

64.6

$          

4.93%

62.2

$          

4.89%

2.4

$         

3.9%

4

Adjusted Net Income

35.8

2.73%

34.4

2.71%

1.4

4.1%

2

Adjusted Diluted EPS

0.81

$          

0.72

$          

0.09

$       

12.5%

October 24, 2011

5

YTD September 2011 Headlines

Sales increased 3.8%, workday adjusted, from YTD September 2010 to

$3.80 billion.

Adjusted earnings per diluted share were $1.87*, up 17%* from YTD

September 2010 EPS of $1.60*.

Gross margin rate of 14.9% was up from 14.8% last year.

Adjusted operating expenses in YTD September 2011 were $407.9

million*, up from $395.4 million* in the prior-year period, and were 10.7%*

of sales versus 10.9%* in the prior-year period.

Adjusted operating income as a percent of sales was 4.2%*, up from 4.0%*

in YTD September 2010.

Adjusted net income increased 10%* to $85.4 million* from $77.9 million* in

YTD September 2010. 

Net cash provided by operating activities was $99.5 million YTD September

2011 compared to $114.4 million YTD September 2010.

Through YTD September 30, 2011, the Company repurchased 4.3 million

shares

for

$137.7

million,

paid

cash

dividends

of

$12

million

to

common

shareholders, and declared another $0.13 per share dividend.

October 24, 2011

6

Year-to-Date 2011 P&L

% to sales change

$ Millions (except EPS)

$

% to Sales

$

% to Sales

$ change

% change

Fav (Unfav)

YTD Q3 2011

YTD Q3 2011

YTD Q3 2010

YTD Q3 2010

Fav (Unfav)

Fav (Unfav)

basis points

Net Sales

3,804.1

$      

3,645.8

$      

158.3

$     

4.3%

Workday Adjusted Sales Growth

3.8%

Gross Margin

566.3

14.89%

541.0

14.84%

25.3

4.7%

5

Operating Expense

413.9

10.88%

389.3

10.68%

(24.6)

(6.3%)

(20)

Operating Income

152.4

4.01%

151.7

4.16%

0.7

0.5%

(15)

Interest & Other

20.4

0.54%

19.3

0.53%

(1.1)

(5.7%)

(1)

Taxes

50.9

1.34%

50.7

1.40%

(0.2)

(0.4%)

6

Net Income

81.1

$          

2.13%

81.7

$          

2.24%

(0.6)

$        

(0.7%)

(11)

Diluted Shares (000s)

45,718

48,624

Diluted EPS

1.77

$          

1.68

$          

0.09

$       

5.4%

Effective Tax Rate

38.6%

38.3%

Adjusted to exclude non-operating items*

Adjusted Operating Income

158.5

$        

4.17%

145.6

$        

3.99%

12.9

$       

8.9%

18

Adjusted Net Income

85.4

2.24%

77.9

2.14%

7.5

9.6%

10

Adjusted Diluted EPS

1.87

$          

1.60

$          

0.27

$       

16.9%

October 24, 2011

7

Sales

by Product Category –

Q3 2011

•

Technology sales were relatively flat with lower purchases from National Accounts being offset by

significant growth in New Channels and from other targeted initiatives.

•

Office Products sales remained even with last year with decreases in National Accounts offset by growth

from New Channels. 

•

Janitorial/Breakroom growth reflects increases across all channels and is a result of continued strategic

initiatives to build share.  

•

Industrial sales growth was due to continued strong demand and strategic initiatives.

•

Furniture sales were negatively impacted by a challenging transactional market and a sourcing shift in

some national account business.

Sales

Sales

Sales

Sales

Sales

growth (decline)

growth (decline)

growth (decline)

growth (decline)

growth (decline)

Q3 2011

Q2 2011

Q1 2011

Q4 2010

Q3 2010

Category

vs Q3 2010

vs Q2 2010

vs Q1 2010

vs Q4 2009

vs Q3 2009

Technology

(0.6%)

(5.8%)

3.6%

(2.8%)

(1.4%)

Office Products

(0.6%)

4.4%

3.4%

0.4%

6.7%

Janitorial/

Breakroom

10.6%

11.5%

7.5%

(1.7%)

(4.4%)

Industrial

23.7%

20.5%

26.1%

25.2%

29.6%

Furniture

(9.8%)

(3.9%)

(0.9%)

0.9%

(0.1%)

Technology

32%

Office Products

28%

Janitorial/

Breakroom

25%

Furniture

7%

Industrial

8%

Q3 2011

October 24, 2011

8

Sales by Channel –

Q3 2011

Sales growth

Sales growth

Sales growth

Sales growth

Sales growth

(decline)

(decline)

(decline)

(decline)

(decline)

Q3 2011

Q2 2011

Q1 2011

Q4 2010

Q3 2010

Channel

vs Q3 2010

vs Q2 2010

vs Q1 2010

vs Q4 2009

vs Q3 2009

Independent

& Other

5.7%

4.4%

6.2%

1.2%

3.7%

Nationals

(12.1%)

(5.6%)

1.8%

(4.3%)

(7.6%)

Independent

& Other

87%

Nationals

13%

Q3 2011

•

Independent/Other channel sales growth was attributable to 24% growth in Industrial, continued

success with growth initiatives and strong double-digit growth with New Channel customers,

including e-tail.

•

National accounts sales decline was mainly due to a shift to more direct purchases from

manufacturers, primarily in furniture and certain technology products.

October 24, 2011

9

Gross Margin

dollars in millions

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Dollars

$166.9

$179.2

$194.8

$189.5

$182.4

$184.2

$199.7

Rate

14.5%

14.7%

15.3%

16.0%

14.7%

14.7%

15.3%

10.0%

12.5%

15.0%

17.5%

20.0%

$-

$25.0

$50.0

$75.0

$100.0

$125.0

$150.0

$175.0

$200.0

•

Margins were flat in Q3 2011 versus Q3 2010 due to lower margin-mix, continued competitive

pricing

pressures,

and

higher

diesel

fuel

costs

offset

by

higher

product

cost

inflation,

higher

inventory purchase-related supplier allowances, other inventory-related items and “War on

Waste”

(WOW) savings.

October 24, 2011

10

Adjusted Operating Expense*

dollars in millions

Q1 10

Q2 10 *

Q3 10 *

Q4 10 *

Q1 11 *

Q2 11 *

Q3 11

Dollars

$131.1

$131.7

$132.6

$136.9

$140.8

$132.0

$135.1

Rate

11.4%

10.8%

10.4%

11.5%

11.4%

10.5%

10.3%

7.5%

10.0%

12.5%

15.0%

$-

$25.0

$50.0

$75.0

$100.0

$125.0

$150.0

•

Adjusted

operating

expense

dollars

increased

slightly

in

Q3

2011

versus

the

prior-year

quarter

mainly

due

to

sales

growth,

investment

in

strategic

growth

initiatives,

and

higher

bad

debt

costs.

These

increases

were

partially

offset

by

lower

depreciation,

favorable

resolution

of

non-income

based

tax

liabilities, and savings from WOW initiatives.

•

As

a

percent

to

sales,

adjusted

operating

expenses

were

12

basis

points

favorable

versus

the

prior

year.

October 24, 2011

11

Adjusted Operating Income*

dollars in millions

Q1 10

Q2 10 *

Q3 10 *

Q4 10 *

Q1 11*

Q2 11*

Q3 11

Dollars

$35.8

$47.6

$62.2

$52.6

$41.6

$52.2

$64.6

Rate

3.1%

3.9%

4.9%

4.4%

3.4%

4.2%

4.9%

2.0%

3.0%

4.0%

5.0%

6.0%

$-

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

October 24, 2011

12

Adjusted Earnings per Share*

shares in millions

Q1 10

Q2 10 *

Q3 10 *

Q4 10 *

Q1 11*

Q2 11*

Q3 11

EPS

$0.37

$0.51

$0.72

$0.58

$0.47

$0.59

$0.81

Diluted Shares

49.640

49.272

47.548

47.456

46.656

46.340

44.202

0.000

1.000

$-

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70

$0.80

$0.90

October 24, 2011

13

Working Capital Summary

$ Millions

3/31/2010

6/30/2010

9/30/2010

12/31/2010

3/31/2011

6/30/2011

9/30/2011

Accounts Receivable

606.2

$     

642.6

$        

655.1

$        

628.1

$        

648.1

$        

669.5

$        

699.2

$        

Inventories (LIFO)

610.1

639.2

617.4

684.1

636.2

632.1

615.5

Accounts Payable

433.8

443.9

424.9

421.6

422.4

443.5

410.8

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Net Trade A/R DSO

43

42

41

41

42

41

42

Inventory Turns

6.6

6.7

6.8

6.1

6.4

6.8

7.1

A/P as % Inventory (LIFO)

71%

69%

69%

62%

66%

70%

67%

A/P as % Inventory (FIFO)

63%

61%

61%

55%

58%

61%

58%

•

Receivables

were

up

7%

versus

the

Q3

2010

and

up

11%

compared

to

Q4

2010. 

•

Net trade A/R DSO increased slightly compared to Q3 2010 as the economic environment remains

challenging for certain customers.

•

Inventories

were

down

0.3%

versus

Q3

2010

and

down

10%

versus

Q4

2010

as

the

Company

continues to manage working capital efficiently while maintaining high service levels.

•

Turnover

remained

strong

at

7.1

turns

vs.

6.8

turns

at

this

time

last

year. 

•

Payables leverage ratios were down slightly from Q3 2010 but up from Q4 2010 and in line with

typical levels.

October 24, 2011

14

Cash Flows

QTD

QTD

QTD

QTD

2010

QTD

QTD

QTD

2011

$ Millions

Q1 10

Q2 10

Q3 10

Q4 10

Total Year

Q1 11

Q2 11

Q3 11

YTD

Net Income

18.2

$       

27.0

$       

36.5

$       

31.1

$       

112.8

$        

20.4

$          

24.9

$          

35.8

$          

81.1

$          

Depreciation & Amortization

9.4

9.4

9.4

9.4

37.6

9.0

8.9

8.7

26.6

Share-based compensation

3.3

3.5

3.7

3.6

14.1

3.7

6.7

2.7

13.1

Writedown on impaired assets

-

-

-

-

-

1.6

-

-

1.6

Change in Accounts Receivable

35.9

(36.7)

(12.3)

27.0

13.9

(19.8)

(21.3)

(30.6)

(71.7)

Change in Inventory

(18.1)

(29.4)

21.9

(66.5)

(92.1)

48.2

4.3

15.2

67.7

Change in Accounts Payable

42.5

9.9

(18.9)

(3.3)

30.2

1.0

21.0

(33.1)

(11.1)

Change in Other Working Capital

(4.1)

1.0

12.8

(6.6)

3.1

(18.7)

(3.3)

21.7

(0.3)

Change in Working Capital

56.2

(55.2)

3.5

(49.4)

(44.9)

10.7

0.7

(26.8)

(15.4)

Other

(4.2)

(12.9)

6.6

5.7

(4.8)

(4.4)

(8.9)

5.8

(7.5)

Adjusted cash provided by (used in)

operating activities

82.9

(28.2)

59.7

0.4

114.8

41.0

32.3

26.2

99.5

Capital Expenditures

(5.7)

(5.0)

(7.3)

(9.3)

(27.3)

(9.8)

(6.4)

(4.6)

(20.8)

Proceeds from disposition of fixed assets

-

-

0.1

-

0.1

-

0.0

0.1

0.1

Net cash used for capital expenditures *

(5.7)

(5.0)

(7.2)

(9.3)

(27.2)

(9.8)

(6.4)

(4.5)

(20.7)

Free Cash Flow *

77.2

$       

(33.2)

$      

52.5

$       

(8.9)

$        

87.6

$          

31.2

$          

25.9

$          

21.7

$          

78.8

$          

•

Cash flow was positively affected by a significant reduction in inventory, offset by higher accounts

receivable and lower accounts payable. 

October 24, 2011

15

Debt and Capitalization

$ Millions

3/31/2010

6/30/2010

9/30/2010

12/31/2010

3/31/2011

6/30/2011

9/30/2011

Debt

441.8

$     

453.4

$     

441.8

$     

441.8

$     

441.8

$     

441.8

$     

489.7

$     

Equity

730.5

710.6

733.1

759.6

769.7

752.7

721.2

Total capitalization

1,172.3

$   

1,164.0

$   

1,174.9

$   

1,201.4

$   

1,211.5

$   

1,194.5

$   

1,210.9

$   

Debt-to-total capitalization

37.7%

39.0%

37.6%

36.8%

36.5%

37.0%

40.4%

•

Operating cash flow generated continues to be used for investments in growth initiatives, share

repurchases, and quarterly dividends.

•

Total debt was up $47.9 million from Q3 2010 and Q4 2010. In September the Company completed

a five-year $700 million Revolving Credit Facility.  This facility replaces the Company’s $425 million

revolver and $200 million term loan. The Revolving Credit Facility will be used for strategic growth

initiatives, working capital needs and other general corporate purposes.

•

Share

repurchases

totaled

4.3

million

shares,

or

$137.7

million,

in

the

year

through

September

2011.