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United States
Securities and Exchange Commission
Washington, DC 20549

FORM 10-Q

(Mark One)

For the quarterly period ended June 30, 2002

or

For the transition period from                                      to                                     

UNITED STATIONERS INC.
UNITED STATIONERS SUPPLY CO.
(Exact Name of Registrant as Specified in its Charter)

2200 East Golf Road
Des Plaines, Illinois 60016-1267
(847) 699-5000
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrants'
Principal Executive Offices)

Indicate by check mark whether each registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that each registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

United Stationers Inc.:    Yes  ý    No  o
United Stationers Supply Co.:    Yes  ý    No  o

On August 9, 2002, United Stationers Inc. had outstanding 32,995,852 shares of Common Stock, par value $0.10 per share. On August 9, 2002, United Stationers Supply Co. had 880,000 shares of Common Stock, $1.00 par value per share, outstanding; United Stationers Inc. owns 100% of these shares.

The registrant United Stationers Supply Co. meets the conditions set forth in General Instructions (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format with respect to United Stationers Supply Co.

TABLE OF CONTENTS

1

PART 1—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

IMPORTANT EXPLANATORY NOTE

        This integrated Form 10-Q is filed pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), for each of United Stationers Inc., a Delaware corporation, and its wholly owned subsidiary, United Stationers Supply Co., an Illinois corporation (collectively, the "Company"). United Stationers Inc. is a holding company with no operations separate from its operating subsidiary, United Stationers Supply Co. and its subsidiaries. No separate financial information for United Stationers Supply Co. and its subsidiaries has been provided herein because management for the Company believes such information would not be meaningful because (i) United Stationers Supply Co. is the only direct subsidiary of United Stationers Inc., which has no operations other than those of United Stationers Supply Co. and (ii) all assets and liabilities of United Stationers Inc. are recorded on the books of United Stationers Supply Co. There is no material difference between United Stationers Inc. and United Stationers Supply Co. for the disclosure required by the instructions to Form 10-Q and therefore, unless otherwise indicated, the responses set forth herein apply to each of United Stationers Inc. and United Stationers Supply Co.

2

INDEPENDENT ACCOUNTANTS' REVIEW REPORT

The Board of Directors
United Stationers Inc.

        We have reviewed the accompanying condensed consolidated balance sheet of United Stationers Inc. and Subsidiaries as of June 30, 2002, and the related condensed consolidated statements of income for the three month and six month periods ended June 30, 2002 and 2001, and the condensed consolidated statements of cash flows for the six month periods ended June 30, 2002 and 2001. These financial statements are the responsibility of the Company's management.

        We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

        Based on our reviews, we are not aware of any material modifications that should be made to the accompanying condensed consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States.

        We have previously audited, in accordance with auditing standards generally accepted in the United States, the consolidated balance sheet of United Stationers Inc. as of December 31, 2001, and the related consolidated statements of income, changes in stockholders' equity, and cash flows for the year then ended (not presented herein) and in our report dated January 29, 2002, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2001, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/Ernst & Young LLP

Chicago, Illinois
July 19, 2002

3

UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

See notes to condensed consolidated financial statements.

4

UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(Unaudited)

See notes to condensed consolidated financial statements.

5

UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(Unaudited)

See notes to condensed consolidated financial statements.

6

UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)

See notes to condensed consolidated financial statements.

7

UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.    Basis of Presentation

        The accompanying Condensed Consolidated Financial Statements are unaudited, except for the Condensed Consolidated Balance Sheet as of December 31, 2001. These financial statements have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. Accordingly, the reader of this Quarterly Report on Form 10-Q should refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 for further information. In the opinion of the Company's management, the Condensed Consolidated Financial Statements for the unaudited interim periods presented include all adjustments necessary to fairly present the results of such interim periods and the financial position as of the end of said periods. Certain interim estimates of a normal, recurring nature are recognized throughout the year, relating to accounts receivable, manufacturers' allowances, inventory, self-insurance, customer rebates, price changes and product mix. Any refinements to these estimates based on actual experience are recorded when known. Certain amounts from prior periods have been reclassified to conform to the 2002 presentation.

        The Condensed Consolidated Financial Statements represent United Stationers Inc. ("United") with its wholly owned subsidiary, United Stationers Supply Co. ("USSC"), and its subsidiaries—collectively the "Company." The Company is the largest general line business products wholesaler in the United States, with trailing 12 months net sales of approximately $3.7 billion. The Company operates in a single reportable segment as a national wholesale distributor of business products. The Company offers approximately 40,000 items from more than 500 manufacturers. This includes a broad spectrum of office products, computer supplies, office furniture, business machines, presentation products and facilities management supplies. The Company primarily serves commercial and contract office products dealers. The Company sells its products through a national distribution network to more than 20,000 resellers, who in turn sell directly to end-users. These products are distributed through a computer-based network of 36 USSC regional distribution centers, 24 dedicated Lagasse, Inc. ("Lagasse") distribution centers that serve the janitorial and sanitation industry, two distribution centers in Mexico that serve computer supply resellers, two distribution centers that serve the Canadian marketplace and a mega-center that supports several of the Company's business units. During the second quarter of 2002, the computer systems and product offerings of Azerty Incorporated ("Azerty"), a wholly owned subsidiary of USSC, were integrated into USSC. In connection with this integration, the Company closed the four separate U.S. Azerty distribution centers.

Acquisition of Peerless Paper Mills, Inc.

        On January 5, 2001, USSC's subsidiary, Lagasse, acquired all of the capital stock of Peerless Paper Mills, Inc. ("Peerless"). Subsequently, Peerless was merged into Lagasse. Peerless was a wholesale distributor of janitorial/sanitation, paper, and food service products. The purchase price of approximately $32.7 million was financed through the Company's Senior Credit Facility. The acquisition was accounted for using the purchase method of accounting and, accordingly, the purchase price was allocated to the assets purchased and the liabilities assumed, based upon the estimated fair values at the date of acquisition. The excess of cost over fair value of approximately $15.5 million was allocated to goodwill. The pro forma effects of the acquisition were not material.

8

Sale of CallCenter Services Business

        On July 1, 2000, the Company acquired all of the capital stock of CallCenter Services, Inc. CallCenter Services, Inc. was a customer relationship management outsourcing service company with inbound call centers in Wilkes-Barre, Pennsylvania, and Salisbury, Maryland. In November 2001, the Wilkes-Barre portion of the business acquired as part of CallCenter Services, Inc. was sold to Customer Satisfaction First for a nominal cash payment, the assumption of associated liabilities and the payment of expenses relating to that business during a post-closing transition period. Disputes relating to expense payments and certain liabilities associated with this sale have adversely contributed and may continue to contribute to the operating expenses attributable to The Order People Company during 2002. In the second quarter of 2002, the Company sold the Salisbury portion of the business acquired as a part of CallCenter Services, Inc. to 1-800-BARNONE, a Financial Corporation, Inc. for $1.2 million in cash and the assumption of $1.7 million of debt. The sale of these assets did not have a material impact on the Company's Condensed Consolidated Financial Statements.

Common Stock Repurchase

        On October 23, 2000, the Company's Board of Directors authorized the repurchase of up to $50.0 million of United common stock. During the six-month period ended June 30, 2002, the Company purchased 333,600 shares at a cost of approximately $10.3 million. The Company purchased 167,500 shares at a cost of $4.1 million in the same period last year. As of June 30, 2002, there was approximately $4.9 million remaining under this authorization. Acquired shares are included in the issued shares of the Company and treasury stock, but are not included in average shares outstanding when calculating earnings per share data. During the six months ended June 30, 2002 and 2001, the Company reissued 203,504 shares and 38,839 shares, respectively, of treasury stock primarily to fulfill its obligations under its management equity plans.

        On July 1, 2002, the Company's Board of Directors approved an expanded stock repurchase program, authorizing the purchase of an additional $50.0 million of United common stock. In July 2002, the Company used the remaining $4.9 million of the October 2000 authorization and repurchased $7.6 million under the new authorization.

2.    Summary of Significant Accounting Policies

Principles of Consolidation

        The Condensed Consolidated Financial Statements include the accounts of the Company. All intercompany accounts and transactions have been eliminated in consolidation. For all acquisitions, account balances and results of operations are included in the Condensed Consolidated Financial Statements as of the date acquired.

Revenue Recognition

        Revenue is recognized when a service is rendered or when a product is shipped and title has transferred to the customer. Management records an estimate for future product returns related to revenue recognized in the current period. This estimate is based on historical product return trends and the gross margin associated with those returns. Management also records an estimate for customer rebates which is based on estimated annual sales volume to the Company's customers. This estimate is used to determine the projected annual rebates earned by customers for growth components, volume hurdle components, and advertising allowances.

9

Cash Equivalents

        All highly liquid debt instruments with an original maturity of three months or less are considered cash equivalents. Cash equivalents are stated at cost, which approximates market value.

Accounts Receivable

        Accounts receivable are presented net of the allowance for doubtful accounts. To determine the allowance for doubtful accounts, management reviews specific customers and the Company's accounts receivable aging.

Inventory

        Inventory constituting approximately 88% and 77% of total inventory at June 30, 2002 and December 31, 2001, respectively, have been valued under the last-in, first-out ("LIFO") method. The increase in the percentage of inventory on LIFO is primarily the result of the integration of Azerty's product offering into USSC. Inventory valued under the first-in, first-out ("FIFO") and LIFO accounting methods is recorded at the lower of cost or market. If the lower of FIFO cost or market method of inventory accounting had been used by the Company for all inventory, merchandise inventory would have been approximately $24.5 million and $26.2 million higher than reported at June 30, 2002 and December 31, 2001, respectively.

        Inventory reserves are recorded for shrinkage, obsolete, damaged, defective, and slow-moving inventory. These reserve estimates are determined using historical trends and are adjusted, if necessary, as new information becomes available.

Property, Plant and Equipment

        Property, plant and equipment are recorded at cost. Depreciation is determined by using the straight-line method over the estimated useful lives of the assets. The estimated useful life assigned to fixtures and equipment is from two to 10 years; the estimated useful life assigned to buildings does not exceed 40 years; leasehold improvements are amortized over the lesser of their useful lives or the term of the applicable lease.

Goodwill and Intangible Assets

        Effective January 1, 2002, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets." SFAS 142 requires the Company to annually, or more frequently if impairment indicators arise, test goodwill and other indefinite-lived intangible assets for impairment rather than amortize them. Application of the non-amortization provisions of SFAS 142 resulted in an after-tax benefit of $2.7 million, or $0.08 per diluted share, for the six months ended June 30, 2002 compared with the prior year. During 2001, the Company recorded an after-tax charge of $5.3 million, or $0.16 per share. The Company completed its impairment analysis for its $180.6 million of goodwill in the second quarter of 2002. The Company's assessment resulted in no adjustment to the net carrying amount of goodwill.

10

        The following table reflects the actual results for the three and six months ended June 30, 2002, and the pro-forma results for the same periods last year, assuming the discontinuation of goodwill amortization:

Software Capitalization

        The Company capitalizes internal-use software development costs in accordance with the American Institute of Certified Public Accountants' Statement of Position No. 98-1 "Accounting for Costs of Computer Software Developed or Obtained for Internal Use." Amortization is recorded on a straight-line basis over the estimated useful life of the software, generally not to exceed seven years.

Self-Insurance Liability Estimates

        The Company is primarily responsible for retained liabilities related to workers' compensation, auto and general liability and certain employee health benefits. The Company records an expense for claims incurred but not reported based on historical trends and certain assumptions about future events.

Income Taxes

        Income taxes are accounted for using the liability method, under which deferred income taxes are recognized for the estimated tax consequences for temporary differences between the financial statement carrying amounts and the tax basis of assets and liabilities. A provision has not been made for deferred U.S. income taxes on the undistributed earnings of the Company's foreign subsidiaries because these earnings are intended to be permanently invested.

Foreign Currency Translation

        The functional currency for the Company's foreign operations is the local currency. Assets and liabilities of these operations are translated at the rates of exchange at the balance sheet date. The resulting translation adjustments are included in accumulated other comprehensive income, a separate component of stockholders' equity. Income and expense items are translated at average monthly rates of exchange. Gains and losses from foreign currency transactions were not material.

11

Use of Estimates

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ from these estimates.

        Various assumptions and other factors underlie the determination of significant accounting estimates. The process of determining significant estimates is fact specific and takes into account factors such as historical experience, current and expected economic conditions, product mix, and in some cases, actuarial techniques. The Company periodically reevaluates these significant factors and makes adjustments where facts and circumstances dictate. Historically, actual results have not significantly deviated from those determined using the estimates described above.

3.    Restructuring Charge

        The Company's board of directors approved a restructuring plan in the third quarter of 2001 that included:

•

An organizational restructuring aimed at eliminating certain layers of management to achieve a lower cost structure and provide better service to customers;



•

The consolidation of certain distribution facilities and call center operations;



•

An information technology platform consolidation;



•

Divestiture of The Order People's call center operations and certain other assets; and



•

A significant reduction to The Order People's cost structure.

        The restructuring plan calls for a workforce reduction of 1,375. These positions primarily relate to The Order People and call center operations. The associate groups that are affected by the restructuring plan include management personnel, inside and outside sales representatives, call center associates, distribution workers, and hourly administrative staff. The restructuring plan is designed to have all initiatives completed within approximately one year from the commitment date.

        During the third quarter of 2001, the Company recorded a pre-tax restructuring charge of $47.6 million, or $0.85 per share (on an after-tax basis). This charge included a pre-tax cash charge of $31.7 million and a $15.9 million non-cash charge. During the first quarter 2002, the Company reversed

12

$0.7 million of the pre-tax cash charge and $1.7 million of the non-cash charge. The major components of the restructuring charge and the remaining accrual balance as of June 30, 2002 are as follows:

        The non-cash asset write-downs of $15.9 million were primarily the result of facility closures and business divestitures, including $8.8 million related to property, plant and equipment and $7.1 million related to goodwill. Asset write-downs were based on management's estimate of net realizable value. Proceeds from the sale of certain assets exceeded the estimated net realizable value, resulting in the reversal of $1.7 million during the first quarter of 2002.

        Employment termination and severance costs are related to voluntary and involuntary terminations and reflect cash termination payments to be paid to associates affected by the restructuring plan. Severance-related costs (health care benefits and career transition services) are included in termination and severance costs. The restructuring plan allows associates to continue their participation in the Company's health care plans during the term of their severance. During the first quarter of 2002, the Company reversed $0.5 million of severance-related costs due to such costs being lower than originally estimated.

        Accrued exit costs are primarily contractual lease obligations that existed prior to September 30, 2001 for buildings that the Company has closed or will be closing in the near future. During the first quarter of 2002, the Company reversed $0.2 million of accrued exit costs as a result of such costs being lower than originally estimated.

        Implementation costs will be recognized as incurred and consist of costs directly related to the realization of the restructuring plan. These costs include training, stay bonuses, consulting fees, costs to relocate inventory, and accelerated depreciation. Implementation costs incurred during second quarter of 2002 and the six months ended June 30, 2002 totaled $2.5 million and $4.3 million, respectively. Accumulated implementation costs incurred for the period September 30, 2001 through June 30, 2002 were $6.5 million. The Company estimates that the remaining implementation costs, which will be expensed as incurred during the next two quarters, should total approximately $1.5 million.

        As of June 30, 2002, the Company completed the closure of nine distribution centers and one USSC call center, eliminated one administrative office, divested the call center operations dedicated to serving The Order People's clients and implemented its organizational restructuring and workforce reduction. As a result, the Company reduced its workforce by 1,147 a