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SEGMENT INFORMATION
6 Months Ended
Jul. 01, 2017
SEGMENT INFORMATION

NOTE 11. SEGMENT INFORMATION

Following the decision to sell substantially all of the operations that previously were presented as the International Division, the Company has two operating segments which are also its reportable segments: the Retail Division and the Business Solutions Division. The Retail Division includes retail stores in the United States, including Puerto Rico and the U.S. Virgin Islands, which offer office supplies, technology products and solutions, business machines and related supplies, facilities products, and office furniture. Stores also have a copy and print center offering printing, reproduction, mailing and shipping services. The Business Solutions Division sells office supply products and services in the United States, including Puerto Rico and the U.S. Virgin Islands, and Canada. The Business Solutions Division customers are served through dedicated sales forces, catalogs, telesales, and electronically through its internet sites.

The retained operations previously included in the International Division are not significant and have been presented as Other.

The office supply products and services offered across the segments are similar. Division operating income is determined based on the measure of performance reported internally to manage the business and for resource allocation. This measure charges to the respective Divisions those expenses considered directly or closely related to their operations and allocates support costs. Certain operating expenses and credits are not allocated to the Divisions including Merger, restructuring and other operating (income) expenses, net, and Asset impairments, as well as expenses and credits retained at the corporate level, including certain management costs and legacy pension and environmental matters. Other companies may charge more or less of these items to their segments and results may not be comparable to similarly titled measures used by other entities.

The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals, after the elimination of the discontinued operations for all periods.

 

     Sales  
     Second Quarter      First Half  
(In millions)    2017      2016      2017      2016  

Retail Division

   $ 1,111      $ 1,249      $ 2,469      $ 2,755  

Business Solutions Division

     1,248        1,330        2,563        2,698  

Other

     4        4        7        6  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total

   $ 2,363      $ 2,583      $ 5,039      $ 5,459  
  

 

 

    

 

 

    

 

 

    

 

 

 
     Operating Income (Loss)  
     Second Quarter      First Half  
(In millions)    2017      2016      2017      2016  

Retail Division

   $ 20      $ 30      $ 132      $ 132  

Business Solutions Division

     64        63        122        109  

Other

     (1      2        (2      2  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total

   $ 83      $ 95      $ 252      $ 243  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

A reconciliation of the measure of Division operating income to Consolidated income from continuing operations before income taxes is as follows:

 

                                           
     Second Quarter     First Half  
(In millions)    2017     2016     2017     2016  

Total Division operating income

   $ 83     $ 95     $ 252     $ 243  

Add/(subtract):

        

Asset impairments

     (1     —         (1     —    

Merger, restructuring and other operating income (expenses), net

     (20     193       (40     154  

Unallocated expenses

     (16     (17     (38     (41

Interest income

     6       6       12       11  

Interest expense

     (14     (23     (27     (44

Other expense, net

     (3     —         (2     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from continuing operations before income taxes

   $ 35     $ 254     $ 156     $ 323  
  

 

 

   

 

 

   

 

 

   

 

 

 

As of July 1, 2017, goodwill totaled $363 million, of which $78 million was recorded in the Retail Division and $285 million in the Business Solutions Division.