Risk Factors Update Summary

• Approved a new stock repurchase program of up to $1 billion, replacing the existing program.
• Operating income for the Veyer Division increased by $6 million from 2022 to 2023.
• Expected return on plan assets decreased from 8% to 6%, impacting net periodic pension benefit.
• Fiscal year 2023 had 52 weeks, ending on December 30, 2023, compared to 53 weeks in 2022.
• Operating expenses decreased significantly in various divisions: Merger, restructuring, and other operating expenses decreased from $39 million to $4 million, unallocated expenses decreased from $91 million to $85 million, and interest income decreased from $20 million to $16 million.
• Net diluted earnings per share increased from $3.37 to $3.50. This change might impact investor sentiment.
• Varis Division operating loss decreased by $3 million, from $66 million in 2022 to $63 million in 2023.
• Operating income for the Office Depot Division decreased by 19% to $230 million in 2023.
• The cybersecurity risk management processes were enhanced, with a focus on protecting information assets.
• Acquired two small regional office supply distribution businesses in the U.S. for $5-15 million each.
• Repurchased 332 thousand shares of common stock at a cost of $17 million.
• Amortization of net gains decreased from $32 million to $6 million.
• The Varis Division's workforce increased from 25,000 to 20,000 full-time and part-time employees.
• The Maximize B2B Restructuring Plan was extended through the end of 2024.
• The Company recognized a non-cash impairment charge of $68 million in the Varis Division, impacting the fair value and resulting in no remaining goodwill in the Varis reporting unit.
• Total current liabilities decreased from $1,859 million to $1,693 million. This change may improve short-term financial stability.
• Change in deferred pension increased by $2 million. This change affects long-term financial obligations.
• Asset impairment charges decreased by $5 million, from $85 million in 2022 to $80 million in 2023.
• Total gross profit decreased by $82 million in 2023, mainly due to lower sales.
• Goodwill impairment in the Varis Division led to a $68 million impairment charge in 2023.
• Net cash provided by operating activities decreased from $(133) million to $(9) million. This change may affect cash flow management.
• The Varis Division's indirect procurement marketplace transitioned to a seamless platform.
• The number of retail stores closed as part of the Maximize B2B Restructuring Plan increased from 237 to 297.
• Sales in the Office Depot Division decreased by $569 million, or 13%, in 2023 compared to 2022.
• Net periodic benefit increased from $8 million to $34 million due to various factors.
• The Company reduced its forecasted spend on Varis in 2024 and beyond, impacting expected revenue growth rates and expenses, potentially leading to impairment charges in future periods.
• Recorded $14 million of asset impairment charges in 2023, including $68 million related to goodwill.
• Common stock outstanding decreased from 42,213,046 to 36,959,377 shares. This change affects ownership structure.
• Total current assets decreased from $1,910 million to $1,678 million. This change may indicate shifts in liquidity.
• Assumed healthcare cost trend rate decreased from 6.10% to 5.30% for next year.
• Cash provided by operating activities increased by $94 million, from $237 million in 2022 to $331 million in 2023.
• Stock repurchase programs were adjusted, with a new program of up to $1 billion approved through March 31, 2027, replacing the existing $1 billion program.
• The Veyer Division reduced its workforce from approximately 4,000 to 3,000 team members.
• Accumulated other comprehensive loss increased from $(77) million to $(114) million. This change may impact financial reporting.
• The Company repurchased 332,000 shares of common stock at a cost of $17 million through February 2024, with $552 million remaining available for stock repurchases.
• Mortality assumption update in 2023 led to a $6 million decrease in pension obligations.
• The Company recognized $2 million in compensation expense for stock options under the Varis Incentive Plan in 2023, with $94 as the weighted average grant-date fair value of options granted.
• Frozen defined benefit pension plan in the UK underwent a bulk annuity purchase.
• Discontinued operations resulted in a loss of $170 million in the fourth quarter of 2023.
• The Company recognized $2 million in compensation expense for stock options under the Performance-Based Incentive Program in 2023, with $45.82 as the weighted average exercise price of outstanding shares at the end of the year.